and then the economy, i think we're so essentially better but it's not truly out of the woods. >> thank you, sir. not mr. winston, mr. wilson. great time together. make sure you join us tomorrow. "squawk on the street" begins right now. >> good morning and welcome to "squawk on the street." stock market's looking to bounce back from the worst week of 2012. looking to add about 101 points, about 11 on the s&p 500. as for europe, the european markets are up for the fifth straight month. germany in particular is higher than 1%. ben bernanke says ultralow rates will help boost growth and hiring. in a speech today at the nabe he

says the labor market improveme improvements. the price per gallon rose 11.5% to $3.93. bats ipo plans to remain -- and hunger games euphoria lifts lion's gate stocks sharply higher in the premarket session. hunger games was the third biggest weekend review. jim and i are laughing because we both saw the movie. meanwhile, the overall stork market getting a lift on ben bernanke's speech. bernanke saying the improved jobs market is a welcome development but it's not clear if the good job trends will last

and that stronger growth is necessary to soothe unemployment. i think that a lot of people would read these comments and interpret them as low rates for a very long time still. >> it's so funny, because as someone who looks bottoms up at the company who are reporting and the research, we have a number of notes about how well the industrials are doing, obviously hiring's gotten better, and there's heads winds. but i find that his script doesn't change. >> when it comes to rates last week, we did come down in yields. but we saw moves that we have not seen in a very, very long time. one wonders whether we really can completely control that end of the curve. >> so many people are saying

that qe-3 will look better towards the election. a lot of people are saying if there is qe-3 it's going to happen in the first month of the year. reaffirming that sort of notion that there will be some other monetary stimulus in the works here. >> it's funny, i have had a series of regional bankers, one may have money. most recently, verizon's ceo says we're going to find rates rise. there's just kind of money being made. so i totally agree that the notion of buying real estate, getting real estate to go from weak hands to strong hands, being able to buy property at a very inexpensive price is very good for the construction industry. but the banks actually want

rates higher at this point. >> and there's reports that they're going to be shrinking their balance sheets. investment banks citing you've got the story on hedge funds, all of this going back to capital ratios, which of course are coming up substantially still, even though many of your banks are already at what they need to be. the question is will it forestall their ability to really increase their lending because you want to continue to take down nasa perhaps. >> if ben bernanke is going to say look, you're not going to make any money in money funds and cds. you can look at the s&p yield, look at the dow jones yield and say i am making 50, .5 on my cds. you can go to high grade corporate paper and go 43. >> what did you make of hewlett

packard's dividend increase. >> a 10% dividend height is a little more competitive. >> the bonds have been trading lower, i don't understand the -- you know what? you need to have fundamentals improve and when you raise the dividend without anything behind it, it reminds me of kodak when it did that. isn't meg whitman planting the seeds now for a turn around? just one step toward an eventually turn around of the company. >> if you're constructive on hlp, that's what you believe. this is not something that's going do happen overnight at all. and i think meg has made that clear in the interviews she has done with us and the conversations she has had. this is a process that's going to take years and you can judge for yourself, the decisions made last week, you said yourself, unless you consolidate printers

and pc under the same management, there are a lot of cost savings going on. there are a lot of layoffs. we tried last time she was on to give u us some sense of what's going on. so there are a lot of layers there, so it's going to be a long road for hb. >> the dividend increase we have seen, including by the way the special dividends. they are all based on bountiful cash and accelerating earnings. i do not see that happening at hewlett packard. i think it is actually something that takes your eye off the core business. a lot of companies are carving it up. oracle's going after that consulting business. meanwhile the pc business, no thank you. sales force.com on the cloud, where's the clouds? they have no mobile strategy, without the holy trinity, you

are nothing in hardware and software and consulting. >> i'm glad we got how you really feel out there. >> look, they are the capital and the rest of the guys are capitalists. that's a reference to the only thing that mattered other than the fact that north carolina choked. >> they didn't have that point guard. >> the two big stories, right? hey, juice. >> i don't use my son picked north carolina so he was very focused. >> if that's his first disappointment in life. he'll be fine. let's talk gas prices. 11.5 cents over the last two weeks. the latest survey putting unleaded regular at $3.93 a gallon. the comments from the publisher of the survey were interesting because we might have seen

prices peak if we don't see another increase in crude, because the prices are already reflective of the rise we have seen in crude prices. >> i think the refiners specifically have not been able to capture nearly as much of the profit margin and as long as you have the incredible decline in capacity in the northeast as many refineries have been closed. you are only gauging it off the price of crude. not taking into effect that refineries have been closing left and right that's where the price increases can come, supply and demand. sonoco was only willing to lose money for a short time. the epa, i don't think anyone thinks this is an issue that fracing is dangerous or not.

nobody want into their backyard, we have a -- it's only going to get worse in the northeast. >> our production of oil continues to increase in this country. >> but it's bottlenecked. the president goes there, we hope the end bridge from conoco. in the interim you don't have enough infrastructure in this country to get it to refineries. those prices are going to go up because refining oil has to be eimported in the northeast even as it's being exordered in the southeast. it's craziness. we're so far behind on the infrastructure. >> so what is going on to solve that problem over time? they're either go to have more refiners come back on. >> if you can get the bottleneck

solved in cushing. >> oil has to move to other refiners. >> we may be in a personally high mode of gasoline, take a look at -- kind of astonished that there's so little refining case. hundreds of thousands of barrels taken out in the northeast. >> versus what's happening in the middle of the country. and lots of gasoline is expo exported. >> exactly. >> to the astonishment of many americans, exporting gasoline at this point, that's insane when gasoline is $3.93 a gallon. >> santorum obviously is a social issue guy. they're talking about obama care. no one seems to be talking about the mismooch aatch and the incr lack of infrastructure because things got overrun in this country, 60% of our oil is

created over here, and we don't know what to do with it. we send it overseas. >> and the price per gallon is going to rise in the midwest once that lower pipeline is completed. >> exactly, west texas is not the correct price. >> ten to 20 cents per gallon is what most oil economists believe. >> this isn't a role according to the calendar of where oil goes. unless this declines dramatically, you're not going to get any relief at the pump. maybe the iran tension is over. >> one thing is that we're trying to become energy independent over the next 10, 12, 15 years, but that doesn't necessarily mean that prices are going to go down. in part because it's a global commodity. it doesn't mean necessarily it's good for our pocket books.

>> only if we have a competitive fuel, we do have a competitive fuel in oil and gas. >> a stat brought to me by the ceo of southwest energy, about $1$18 billion that doesn't seem like a lot of money at all. >> look at what we have spent in afghanistan for the last four months. >> clean energy. the only outfit that seems to favor this. but exxon does not support natural gas as a surface fuel. you could put natural gas, come pressed natural gas tanks at an exxon station everywhere, and bingo, the truck companies would switch. obviously there's a big cash advantage, $2 versus $4. but natural gas is not being supported by the government because it's a fossil fuel. those are not fas fuels, natural

gas can be the game changer. >> we got to take a break here, but first on cnbc an interview with the ceo following last week's glitch in the ipo. we're talking about the worst week for stocks since december. how do you know which ones to follow? the equity summary score consolidates the ratings of up to 10 independent research providers into a single score that's weighted based on how accurate they've been in the past. i'm howard spielberg of fidelity investments. the equity summary score is one more innovative reason serious investors are choosing fidelity. get 200 free trades today and explore your next investing idea.

imax now showing on the big board.

as as we mentioned the ceo of the bass community markets was forced to withdraw it's ipo due to a computer glitch on friday. bob, certainly an unprecedented move on friday? >> certainly. and certainly an interesting letter that joe ratterman issued over the weekend. your released a letter over the weekend blaming the glitches on a system problem. can you explain what happened there? >> yeah, bottom line, bob, we failed to open up our own ipo properly. we basically had a software bug that -- and we weren't able to roll from our continuous trading. >> i think the problem was they were a little incredulous about

this. you have done billions of trades, you've been around for six years, can you be a little more specific? what exactly went wrong other than a software glitch. >> basically that was all of it, bob, we found a condition in the office that hadn't been found in all the tests that had been done. weeks and months of testing with our participant. >> you also had erroneous trades with apple. was that because you were on the same server on the same module that the cpo keeps trading. >> it basically went steal and it wasn't pulled out of the national system as it could have been. >> the software could occur on any exchange. but you guys represent a certain kind of trading, high speed trading, computerized trading, whatever you want to call it. this is the problem with speed at any cost and this is an

example of the rickety market structure that we have. what do you say to all those critics out there? >> friday was basically outlined through our own market. the companies traded away from us. so, you know, the thing with stocks, circuit breakers -- actually contained us to a large degree and worked the way it was supposed to. . >> you still could go public in the second quarter? is that part of your plan. >> we have to pull together our board and discuss what we're going to do next, so we don't have additional plans at this point.suggested that you were going to go public or you should. >> we have to regroup and we have to earn back some confidence and we need to reconvene with our board.

>> what do you think about the sec? have they contacted you when the -- >> we contacted them when we knew when the system was having issues. so we were on the phone with them and coordinating them on the issues throughout the day. >> david in part of his letter said he didn't think this would have much impact on your local -- there's some reputational damage that's been down here. will traders be a little more hesitant to route orders through you. >> we have a fantastic track record and i think our customers will be able to give us their trust. >> you helped rack up on friday and you obviously could have hidden in a cave in kansas.

what do you guys do for the little guy? how do you help the little guy come back to the market? because i'm always kind of at a loss as to what you do to help the regular investor? because i don't see it. >> the markets are significantly more efficient today. when you go out on average, you're going to extremely tight and more size than you had three years ago. trading is much more price effective and much more confident for people -- >> did you use the word confident? i mean do you think they will bemore confident? maybe i'm just oblivious, living in another world. >> when you go to the market on a regular basis, you have confidence that the orders are going to be delivered to you very quickly. as an industry, we have made great strides in bringing a lot of structures back that have

helped improve it. >> you just said to what happened on friday, these things happen. i'm sure you had a rough weekend, i hate to pile on, but these things don't happen on the day you're going public. is anything going to get fired? would you say, hey, i'm not going to run this company anymore? it is unbelievable that on the day this happened -- >> or will voting be suspended? >> absolutely there will be no reward for an employee that's associated with -- so that's a natural conclusion. >> are you going to fire anybody? i mean, is this the kind of thing where people lose their jobs? >> no, look, i serve at the discretion and the pleasure of the boards and if the board decides they need to take a leadership change, they l. >> no, not leadership -- guys who really do screw up on wall street, i think people are very used to now at home saying, if you screw up on wall street,

it's fine, who cares, it doesn't matter, we all make a lot of money. i think it's all real estate. >> there are things that we could have done better that we need to address, we absolutely will address them. we take this extremely seriously. >> joe there was some speculation that the ipo was killed largely out of concerns that there was future litigation out there. you did not adequately perform, the trading system did not perform up to snuff. >> after a couple of hours of waiting for the market to open, based on our system issues, investor confidence had simply eroded. we knew that we could not open up the market on our stock because investor confidence had eroded. and the trading community at large for the full ipo. >> what does that mean, investor confidence eroded.

they were going to sell, creating a bloodbath should the stock reopen. is that really what happened behind the scenes before the pulling of the ipo? >> we're in the stage where we're opening up our own stock and those investing in our exchange would have a confidence issue based on friday's events and that's what i mean by eroding investor confidence, those that had taken part in the ipo.o. >> what do you want to say about the investment community and the trading community. is there anything you want to tell everybody? >> i just need to extend my sincerest apology in regret for friday's failure. the moment things weren't going according to to plan, and every associate in our company feels absolutely terrible but we will earn their confidence back. >> you were in an odd situation, many of your investors were the people who were floating the ipo, any final words on that? >> we took the right action --

>> joe ratterman, very much appreciated. bottom line is software glitches occur on all exchanges but this one really hurt and it eroded investor confidences. >> i think it's great that he came on and explained himself. but i think we deal every day with the declining volume. we deal every day with the tvix, this index that was secreted by credit suisse to -- my pool on the march madness is more heavily regulated. the nfl is more heavily regulated because they came down on sean payton. but the sec, they're going to look at this now, this is america, and in america we have regulations and they're not just -- we don't just live in a world where the commissioner of

the nfl is powerful, but the government is not powerful. >> it almost seems worse than something that's regulated or unregulated. this was a glitch, a random occurrence that happened to happen on the day of this country's ipo. if it's going to happen, it's going to happen any old day of the week. >> i think that he answered this, we go to go. i think the real problem is they weren't set up for the coding of the ipo. the servers for the ipo were on the servers for apple and the other a & b stocks. >> it's their own ipo. >> people love that. >> that was a glaet story. this is hilariouhilarious, but put their life savings into stocks. they invest for college. i have actually seen people put retirement money in stocks. they do that. how do they do with that apple

down one? it is kind of shocking that they still trust this market rather than nfl gambling which is so heavily regulated. >> we got to take a break. mad dash straight ahead. [ male announcer ] you are a business pro.

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get sold down over china. honey well, tic orko ingersol rachbd. >> i think some were sold off -- >> and i have to tell you that i do see this morning, bydt chinese auto company saying business is going to slump. we have to rerk nice that this country used to be an engine of growth and can be it again. i urge people to look at this group as being too cheap versus the rest of the market. >> we're going to get some home data later on. in terms of armstrong worldwide. the flooring into homes. special dividend here. >> we get a special dividend from a dcompany that makes floo,

cabinets. and then people said off of the van hunt odds, off of the k.b. homes number, we didn't get any good news, in our reports tomorrow, i think tomorrow is going to be a much better tell of housing. >> take a look at the opening bell here, cnbc real-time. we'll be speaking with the cellular ceo at the nasdaq. we're taking a look at what's opening on the screen here, we have to look another lion's gate. this euphoria over the stock is something, it's not an all-time high, because it had been at 16 and change last week. >> there's a lot of options activity on this stock, you guys talked about it last week and i feel that the problem here is that the bets that were made are so heavy that they almost ensure liquidation this morning. >> right. >> i will point out this is a $2

billion company, this may be a $500 million to $600 million movie. if they did get more than $120 million in sales, i would not be a seller, given the fact that they passed that mark and given the fact that there are three more movies behind this, suddenly this becomes a situation, there's been short-term trading profits. but i think they're longer term. a modern day hero. i urge people to see it. the movie was excellent. you see -- i sat next to people who had -- i saw it in brooklyn, i sat next to people who had that come to manhattan where places were online and they sold out a out. >> it's like going to kansas.

>> but there are a number of firms today hiking the price targeting from lion's gate. >> you notice that the firms that who follow lion's gate, i ha think they're now goldmans. suddenly it becomes a company that is larger than -- the franchise of hunger games could be larger than lion's gate. >> it wasn't too long ago when it was below in market cap. >> the stock is up 75% this year, not including today's gate. so it's a huge move for this movie studio and it's not just hunger games, they have a tv pipeline and their goal is to increase tv revenue as a way of reducing their portfolio. but there's a recurring revenue stream because of t.b. >> another great night, the

starting of a new series. i point out this because the market is starveded for new ideas and lion's gate has been a terrific spec. does it morph into a real company after this opening? up against disney and john carter. maybe lion's gate is better run than we realize. they do have a couple -- look, not every company that is in the movie business has been heard up until now and this is a remarkable thing and i'm not going to dismiss it as being one-time only. lion's gate was a surprise, i tried to get them to commit to 120 when they were here on the floor. but they were afraid to do that, but i think the number is going to turn out to be bigger. this is a bigger story than people realize. >> there's a delayed reaction this morning. wells fargo -- they had a couple of days to think about it. and oh, it really is kind of

bad. >> we're going to see the long-awaited buy fur indication, the oil that is being drilled offshore whether it be from mexico, whether it be off the coast of indonesia, whether it be gulf of mexico in general requires transocean, requires ensco. if you made your bed with natural gas, as baker use did. as halliburton did. you can't make your numbers. natural gas, the drilling around the country is being shut down. the recount lowest in ten years, just came out on friday, the answer is you've got to switch your percentage if you're a big oil company to drilling more oil. and the two ways you can do it is to drill more oil and stop drilling natural gas. >> they got caught flat footed in terms of the mix of the business. any company that went gas here, we saw coal companies get gas. we saw integrated oil get gas here. that's one of the worst bets in

the past that's happened in the past five years. >> they need surface ports to be ado adopted. they need help, they need this transition, they need as you mention, natural gas station, without it there's going to be a glut of natural gas that's going to last a very long time. >> here with bob on what's moving this morning. >> let's start off with bernanke, we heard from the fed chairman for much of the 8:00 to 9:00 hour eastern time. >> and boom, 8:00, boom, future go right up. why? mr. bernanke is worried about unemployment. he's not going to take his foot off the pedal, folks, that's the take away that everybody had. mr. bernanke is worried about slowing unemployment, he didn't say anything about qe-3. you want to understand ben bernanke, read essays on the great depression, read his book on the causes of the great

aggressi depression. it wasn't the market crash, it was the failure of the the fed to act. he's not going raise rates prematurely. and everybody says it will be too late down the road. inflation will be out of control. that's the naysayers. mr. bernanke is convinced that he's got to keep his foot on the pedestal. >> he lays out exactly what he's going to do and the market kind of got what it was looking for. >> we didn't hear anything about qe-3. >> we're up 1 hunter poi00 poin ground already. let's play the economy improving game, let's forget about the qe-3 game. have you seen the hope for second quarter for the stock market? is the s&p is up 11%. it was up 11% in the prior quarter, and the public yawns at

participation in the stock market. outflows from mutual funds. bond funds are now underperforming stocks again in this quarter. the biggest bond fund out there is now down on the quarter. and it makes you wonder when. >> when rates start moving up, it sures when you're in a bond fight. >> in things like high yield, so much goes into high yield, 13 million in the first quarter. some of the managers want to return it, because they can't meet the benchmark. when will the stock market start showing -- >> and you can't answer that question. >> i can't answer that question. but you've been sitting here saying it for how many years now? >> ages and ages, it's an old broken record. an inflection point is going to be reached where all of a sudden, instead of two and a quarter, we're going to be reach it very, very fast i have 2.75,

2.50 let's talk about mr. almonte in italy. he's worried because -- mr. monte said nothing about this, all throughout the last several weeks, monte came out over the weekend and said spain represents general contagion risks. he's talking his own book because if something happens to spain, something is going to happen to italy for sure. >> he's the man for all the country. >> that's right. >> i'm sorry, that's dropping. excuse me, monte is worried got italy. >> the future of europe to a certain extent is riding on monda monday -- the bottom line here

is specifically abstaining on budget controls a little bit. this is hard for him to talk about because he's had his own troubles pushing through reforms. when monte -- >> urge merkel to being more firm as to yes we will go to the fire wall at the higher number. >> he's talking about the internal reforms that italy has to do. >> pay attention to this right now, we'll have more on it later. >> over to jim. >> okay, it's a great discussion because i thought that the spanish downturn in portugal was going to cause our markets to be a little bit weaker. obviously it's not the focus which is pretty amazing given the fact that in the old day s t would have been the only thing we talked about. bertha, what do you have? >> it's interesting here as well, jim, we're kind of accentuating the positive, we're going with the positive numbers coming out of the german

ecobusiness confidence survey. and bernanke's comments really what helped extend the games here. you've got to want brent these days because that's what sets the tone above 125 and r bob is getting higher as we are getting within 20 cents of the record price at the pump. and the sftc says we have records when it comes to those futures. on friday even as speculate fors, they have cut their positions. >> i want to take a look another shares of alumina, we're going to end this quarter, one of the worst quarters for mergers and acquisitions that we have seen since they started keeping records almost. and today no difference, here we are, not a merger monday. >> for sure, the end of the quarter, you have to go out with a bang, there's nothing, not a deal. >> and so we come back to this deal, which is one of the few

large contested deals out there. we continued pursuit of alumina, at 4 4.50. russia extended yet again on the tender offer. but this thing is coming to a head very soon. iss, we'll have influence here, and its expected to meet be roche, perhaps as soon as friday, but certainly within the next week or so, being that you have an april 18 shareholder vote. roach is trying to take over the board. they'll need 2/3 of the vote in favor. to actually take over the board. that is highly unlikely. but the key question for all the investors out here is simply what will roche raise to, when will they do it and will it be enough to at least get some board seats and hang in there and really just win the day overall? >> this is a very good company, we have got a very secular

growth business here, and it seems like i thought they have owning sal voe, rose coming in. can't the clandestine bankers come up with another horse in this race? >> there had been some talk and perhaps that would happen, and in these kinds of cases, sometimes you will find a case where you have at least another stalking horse. what want to-he's a patient buyer, and normally gets what it's half and needs to make the big deal given how large a company it is. >> let's go back to the thing you started with david. if i'm in an investment banker, i'm in morgan stanley, obviously by quarter, i'm not going to get my bonus this year, i can't. what goes on behind the scenes. i used to think that investment banks used to pitch other companies, general mills, you got to look at this because there are challenges for growth.

are pitches not being made? are stocks considered too expensive? >> i think it's bears something -- particularly ceo confidence and while we can see so many things that are positive in this economy, i continue to come back to the conversations that i have with many of the leaders of corporations and what we're seeing in m a& a that there's not that much confidence. maybe it will be the second story that we continue to hear about when it comes to the bankers. hope never dies when it comes to mergers and acquisitions. but we're going to end this with the hope for big deals, we'll see if they come back in the second half. >> david, first on cnbc, we're joined by cell com in israel. shares of sel are down about 20%. you were mentioning that there were actually a lot of cellular

service providers in israel. does that mean that pricing is very difficult because of the competition, there's a lot of pricing pressure. we have seen prices go down extremely high in the last year due to heavy regulation and cutting of interconnect fees and more get fors and all of the new competitors coming in the market. so a lot of instability right now, people looking to see where we're going. but we're doing very well as a company. >> is it a great environment for the hunger of data through smart phones and tablets et cetera. but the pressure to keep prices low in order to compete? >> we're seeing@of moves in terms of data traffic, whether it be from smart phones, tablets and new devices. we're seeing more revenues coming from data as the years go by. i think we'll see a great boost in terms of data revenues. >> are you going to be able to charge for them? i'm not sure you offer unlimited data plans. consumers now are exceeding

these limits very early on in the month. >> i think the whole industry in -- how to price correctly the data, we're doing that as well and we're trying to get more revenue out of data and not cap it with unlimited usage. >> and you do offer the iphone? >> we do offer the ipad. >> the ipad is only the iphone right now. >> is it so heavily subsidized that? >> we're seeing heavy knew coming from boyes and a lot of data uses coming out of iphone users. >> and you mentioned the iphone market. >> i think that next year we'll see new competitors entered into the market. whether it will be consolidation, probably, but it's going to take a while until we see that. are you looking for acquisitions? >> not right now we have acquired a local provider, we're in the middle of merging the two companies, we're seeing a lot of

benefits out of the merger. we move forward towards land buying collusions and communications for services. >> a pleasure to speak to you, the ceo of cell come israel. >> and coming up, data showing best buy selling almost as many iphones as apple stores, but is there a sign the retailer is too dependent on -- >> and as we have a break, this morning's early movers.

and we're back, take a look at the dow heat map. look at the lower right-hand corner there, we are seeing a broad based rally. a broad based rally up by about .9%. there's very little that's down. baker hughes does stand out.

delayed call, the rest of the sector is doing decently in terms of oil services and oil. the prime brokers, the story in the ft is that they will have

to. some of the big banks saying, hey, to do some of the trades, when it comes to more complex derivative straight trades, that will just get passed long from the hedge fund to the clients. >> i think people at home are kind of mystified about what the dichotomy between their costs are going down a trade. these guys costs are going up. it's a total function of the fact that this whole industry, the wall street industry is really going toward the fax model, it has nothing to do with it. believe me, that's involving big institutions, not then. and the little guy's been driven out. no one wants the little guys as a client. and the little guy is really mystified how a stock could go public and not open. >> the conversation we have had so many times and we had with bob so many times are just gone. the only question is are they

going to come back ever? >> the rates are so low, they have to co-back. >> the rates are going up, they haven't come back for the last two years, why would they now? >> the sec had a statement which said on this thing, we were talking about this, it's not our job to opine about the merits of the stock, the question is it shouldn't be a stock. you can't opine on something that never should have been a stock. there's good news, should we have a stock on whether kentucky wins? maybe that's something we could have some versatile till on. >> don't correspond to the underlying assets. >> they made a lot of bed during the bush administration, an anything goes. when you go back and read the research, it was very flawed. but the sec is very much alone it's time to put the jeanie back in the bottle because the

government has to admit their wrong and admitting they're wrong isn't something that the government likes to do. >> the stock market can be quite a circus and we have the ring master, jim cramer and his six stocks in 60 seconds takes center stage when "squawk on the street" returns.

time time now for six in 60. we kick it off with home depot. this is a very strong spring for housing. >> we're seeing a considerable number of people saying big data, big comp. this is the traffic regulator for big data. >> their company's doing well, oracle i think is doing well. >> a refiner is getting an upright from raymond dean. >> and wall greens, uvs warning. >> this is the beginning of when express scripts and cvs are basically moving together. >> and aig's price is getting raised from 35 to at deutsch.

ben moshe is the -- we got to find out the disparity there, the government's going to make a disparity. >> you also got increased dividend. >> a tender, he is, you know alike this home call armstrong world today with that special dinner. >> appliances like coffee makers and -- >> i can't wait to speak to him. >> we will see you tonight at 11:00 p.m. for "mad money." meantime sh much for "squawk on the street" straight ahead. we're cracking down on medicare fraud.

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welcome back to "squawk on the street." another miss on housing, pending home sales fell 0.5% in february. this is based on contracts signed not closings. the index was up 9.2% from a year ago and no doubt there's going to be a push to make that the headline number, but remember we were at historic

lows last year and given incredible affordability, we should be seeing gains month to month. the number of course missed expectations. a jump 6.5% in the midwest. and fell 2.6% out west. again, a disappointment to the down side. melis melissa? >> we did see the home builders turn to red. let's get to the road map. obama care heading to the supreme court today. so what are the implications for the dozens of companies within the health care sector. we have your hmo trade within a few seconds. what does one of the hottest names in tech have to say about the social media surge? we'll talk to michael price.

and consumers getting pinched as gas prices rode. as high prices -- the central banks rate policy can help the labor market, follow iing -- importantly, the dollar is down across the board, that's enabled the euro for example to rise above $1.33 during the course of today's trade. >> we couldn't go too longer simon without mentioning the hunger games that's absolutely -- with the movie which earned 155 million in the u.s. and canadian cinemas this year.

lion's gate has been up sharply and continues to be up quite a bit as well. you can see it about 4.5%. >> i like jennifer lawrence, something with a bone in it? where she was down in the appalachian. i would be curious to see how her performance is in this. >> somebody said to me, i'm not going because it's for kids. >> it's not for kids. it's quite violent actually. i'm not approved when it comes to violent. but it is very violent. you're watching these 12 to 18-year-old children fight to the end, to the death. so you're seeing kids shoot arrow at each other et cetera. i did enjoy the movie quite a bit. >> how does he have time to do

all of this. cramer is like super human. >> it's reminisce sent of a time 30 years ago where you had a lot of publicly traded movie companies which would move on the release of a movie, which only happens more or less on the case of lion's gate disney lost 2 million on john farther. >> most of these come from enormous companies that don't derive a lot of their you really can play a stock based on the reviews, based on the box office of a movie. >> with the supreme court taking up president obama's health care major all today, we want to talk about how to play the -- the jason is a managing care analyst, jason great to have you with us. what are you expecting from the

supreme court? >>. >> i think most likely the supreme court will have up4e8d the care acts, the individual mandate and the medicare expansion. >> for the medicate names, if the medicaid expansion is overthrown, we think it would be negative for sente, molena and ameri group. >> i note from what you said to one of our researchers, in fact it's a far bigger issue for you, whether there's a republican win in november. you figure that could lead to a massive rerating? >> i think if a republican does take the presidency, it could

lead to multiple expansion. jason, these argumenting are going to go on for quite some time. we have seen so many arguments on different areas of a particular law. what are you going to be focused on in particular, have you checked in with litigation experts, litigation experts, we won't get a decision until june most likely. >> we talked to a number of attorneys and as far as the oral arguments go a lot of it is going to be similar to what which have heard from the lower courts. maybe to see if you could get a sense for where they're leechbing one way or the other. but it's going to be a challenge to get a good read one way or

the other. that's probably more to do with a lack of takeoff in a depressed economy, is that right? >> i think it's a fairly favorable environment for managed care in general. the supreme court does report a moderate risk over the next few months. we continue to see a very favor cost trends. >> ifrs fascinated to read over the weekend that the mother of all tax breaks is the 164 billion that is given to those to exempt them from paying tax on their employer insurancea is given to them. if anotherer side of the aisle attempts to claw that battle,

there's a discussion about clawing back that huge tax break, what will that mean for the universe that you cover? >> i think it would certainly be a negative, because in order to offset the extra taxes on that, i think employers could seek to purchase less insurance coverage than they currently buy right now. i don't think we have seen a serious interest in overturning that tax break. >> jason gird yes. >> a live interview with one of tech's hottest advisors. michael price will be on the program, find out what he's watching in the tech and telecome worlds when tech on the street returns this monday morning. [ clang ] the all-new 2013 lexus gs. there's no going back.

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41 minutes into trade and a triple digit on the -- cal-maine foods expecting a third quarter profit. the nation's largest egg producer says it expects feed costs to be higher through summer. tesla -- bank of america-merrill

lynch. this is a phenomenal gain that we're getting coming through this morning. it is ben bernanke inspired. there is no question in that. a lot of people wanted to know where the central bankers thought they were going. and of course what they thought they might be with qe 3 and that is one reason why we vaulted 120 points higher on the dow. >> michael price has been one of the leading advisors for telecome companies through the decades. he also intends a lot of trends shaping the industry as follows. which leads us to apple, facebook, google and the wireless carriers. you say all those names and our viewers are going to pay attention. some of the most important companies and certainly from investors out there. i know something you have been thinking about is the subsidy that apple gets from them to pay

the true cost of that iphone. >> in that 2011 apple iphone business was a $60 billion business. the carriers paid $16 billion in subsidies to enrich apple. apple had gross martins of 55%. apple's margins are in the high to mid 40s to. apple benefits from being a software company, from being an iconic brand and from being the customer poll. because of that, carriers have to date had little choice but to pay for it. >> the a lot of subsidies they're paying to apple almost exceeds the call and expenditure on their wireless -- i want my iphone, you got to give it to me, at what point do they have the power in any way to push back. >> it's the fight for the profit margin. for the last two years, the

subsidy per device that -- has gone from 2$200 to $400 a devic. when you sell 30 million, 40 million devices a year, that adds up. so it is really the fight for the device which ultimately is the fight for who owns the consumer, which ultimately is the fight for who owns the fight. i know you're not going to tell your audiences where to invest. at some point the carriers start to pound apple, can they possibly do that? >> sure, carriers are enormously possible. remember for our five years ago, verizon didn't have the iphone. verizon decided to create

android. without verizoverizon, there is google system. nokia is very motivated to get back into the business. so you'll see nokia put into microsoft. >> so it could be a way at least for the carriers to start to say, we're not paying that subsidy or as much of it? >> the carriers want the power of the suppliers to be as low as possible. >> right now apple just simply has too much power because they have such a great product. so the carriers are highly insented to create alternative ecosystems. and the next one looks like it could be windows mobile. but it brings up a bunch of other possibilities, what happens to facebook, today facebook is the number one app on and an -- on android and face

book. you think it's a google chrome book for wireless devices that will be much cheaper. >> so the carriers are going to force down the pricing of these devices and android is all too happy to accommodate. microsoft is also happy to accommodate. >> we didn't get a chance to talk google, but you mentioned it, about to become public. does it have the power to ultimately be a true disrupter and create its own internet almost? >> 800 million people today? more user engagement than any other priblgt. you really have to ask facebook what their long-term strategy would be, but if you get that much engagement over time, you have that much user power. >> before we had to break, let's take a quick check on the markets here, the dow is up now

by 136 points, that's a gain of more than 1%. ibm helping to lead the way. it's just 20 cents or so away from the all-time high. microsoft is higher by 1.3%. coming up next, gas prices higher by 11 cents, we'll talk big oil with the ceo, joe petrosky. [ donovan ] i hit a wall.

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we have got a we have got a rally on our hands with the dow and the s&p higher by more than 1%. comments by fed chairman ben bernanke this morning. low rates are here for quite some time. that is putting headwind to the dollar which is helping stock prices, the dollar index is about 79, so it's below 80 right now. so dollar weakness across the board. we are being led by the financials here. some very strong gains, morgan stanley up by more than 1%. bank of america, approaching that $1 percent. when you take a look at citi and goldman sachs. microsoft is close to approaching it's high here on the session. 32.46 is the last trade up by 1.4%. so this is a very strong

performance being put in by microsoft. >> let's draw our attention to exactly what bemn bernanke was just saying, are they going to go into qe3. ben bernanke was really unequivocal this morning saying he's looking to see if recent positive developments are s sustained, in other words they might not be. he says he hasn't seen job strength spread across the economy in as he describes a persuasive way. >> the fed's policy right hour is that very low interest rates will remain intact. >> at least week we had the worst percentage in points dropped in december. meanwhile on the corporate front, hewlett packard announcing a 10.3 increase,

joining a list of economies. hp's dividend increase comes at a time when the economy is quite clearly struggling to stabilize it's operations and grow its revenue. so are dividend increases always to the benefit of shareholders? let's bring in president of farr millner washington. are you puzzled by what meg kwh witman is doing or are you in full support. >> if you can't -- in this sort of a low yield environment, the yield on a stock can certainly drive and garner attraction for the price and for the shares. so it's sort of a sign that she doesn't have a whole lot of investment ideas or she just doesn't need it for her future

acquisition plan. it's not always a positive sign, it's probably deentd at this time. >> they don't have that much cash. you wonder what the future holds. i just wonder whether you can look back at some point and say, oh, that was not a good idea. >> you know, david, she could be kind of running up to join the chorus of the apples of the world and say, you know, it seems to be catchy, it seems to be in foggy to be doing the -- >> hewlett packard is no apple. >> it used to be and apple at that point was no hewlett packard. so whitman has her hands full to get them back on track financially. dividend is probably not a bad idea, but it's going to be unfolding as part of the story and strategy. >> do you have a stake in hewlett packard at all?

>> do you own hewlett packard? >> i don't own them, i used to own them and i have been very happy not to own them in recent years. but if you picture the situation she's in, it's not a bad move, certainly for the shares, but she's got a lot of work to do. >> the dividend yield from so many stocks, how is that motivating your purchases, we're still at 2-2 on the ten-year. >> in many companies, it's kinds of like free money. it's hard to find an argument as to why you wouldn't look for good dividend paying stocks in this environment. balance sheets are very strong, yields on other investments are really bad and you look at a name like johnson & johnson with a 3.5% yield, share price hasn't done anything for a long time. why wouldn't you want to collect that dividend? >> there are legs of academic

study that your owning a company and the -- let me just raise one last point if i may, let us not forget the next year, the dividend, the rate at which dividends attacks is supposed to rise to in excess of 43%. now given that the lamarket is forward looking mechanism, doesn't that become a poison chal police and you get people quite heavily stemming those dividend stocks in that a lot of those rates could be taxed out when those rate s jump. >> we heard from bernanke this low rate environment is going to be with us for a while. and you're right, when you look at the historical studies which are what the best policies for companies, those who are able to put their capital at use, for their own use to grow the company, that's what buffett's

always looked for. you do need to watch very closely when these stocks start to rise, they better have something to back it up. we're writing about this this week in our market comment tear. so we'll have more on this all week long. >> coming up, talking the tobacco road to profit. company stocks trading at near 52 highs. [ male announcer ] it's simple physics... a body at rest tends to stay at rest... while a body in motion tends to stay in motion. staying active can actually ease arthritis symptoms. but if you have arthritis, staying active can be difficult. prescription celebrex can help relieve arthritis pain so your body can stay in motion. because just one 200mg celebrex a day can provide 24 hour relief

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one hour to one hour to trading here, 7:30 in the west coast, 29 of the 30 tech stocks are rising. speaking of the blue chips, coca-cola, disney and intell all at 52-week highs. forecast calls for a 1% sales game. >> history in the making, then three days over an argument about obama care and guess what, it's the leading sector gainer so far today, health care, led by tennants.

interestingly enough. it's a fairly broad based rally today, we mentioned financials are higher, it's got an awful lot to do with ben bernanke. it is almost 5 to 1 advance to declines. this is the power of the chairman of the federal reserve, suggesting he's not going to tighten any time soon. this is the nasdaq, and again, you see a big bias to the advanced line there. let's go to chicago. mark sebastian is chief operating officer of mentoring association and he joins us live. we should also mention of course the effect bernanke has had on the dollar. which is down substantially across the board. >> good morning, how are you. bernanke, i think he's really kind of forcing this mark up at this point. there's a lot of tail wind right now because we now have so much

liquidi liquidity pumping into this market. we're looking at what i think is a going to be a big momentum rally today. i wouldn't be surprised if we ended up 20, 25 handles by the end of the day, there's a lot of reasons for money to flow into the equity markets. >> how would you play that? where would you? >> you can get into s&p futures are the simplest way to get in. another interesting way you can play with options. you've got volatility in the toilet, so that would be another way to do it. i think the one thing we have to watch here is oil. one of the kind of famous things is the relationship between s&p and we see the s&ps starred to diverge. that's the one risk in what bernanke is really doing here, if the dollar gets smoked and we see oil really blow through that

110 level, and it really starts to drag on the economy, you're going to see oil keep rallying and that will be a real problem. >> but do you think oil is if we're now talking about a lower dollar for longer. >> i think oil is kind of the crux right here, right now. gold will benefit, silver will benefit, you'll see a lot of talk of the erosion of the dollar, but the real story that traders need to be watching is s&ps versus crude and that relationship because right now, the two have been moving in tandem, when that correlation breaks, that is a very, very bad sign for the u.s. economy and the equity markets. >> mark, have a great week. >> you too. >> we're talking about dividend paying stocks before, some of the biggest dividend payers are tobacco stocks.

over the past -- philip morris hit a new all-time high today. we conducted a survey called tobacco talk. the company has been able to stabilize growing marlboro profitably. so that's what we're looking for, we're there, we're more comfortable. so we decided to take it up to our top u.s. stop pick. >> the fresh record high set in today's session, on a surge of 1.7%. when you compare the two, one is u.s. operations versus international operations because it is seen as the regulatory environment is not as stringent. if you were to compare the two

which would you favor? or are they open at this point. >> i would -- e. >> it's really because of the momentum and the growth, and a lot of that is what we're seeing in asia. we did a deep dive analysis in asia. we see profits in indonesia can quadruple by the year 2020. this stock has a lot more on the upside. >> in terms of the smoking prevalence, they've got a lot of opportunity. >> 6 million is just a drop in the ocean, it won't make any difference between the demographics you're talking about. >> it's tough, there's obviously been a fight on reducing smoking. when you look at the smoking prevalence in the states, it's still 20%. in other countries, it's much

higher. that should benefit pm and how vast their infrastructure is. >> what is your price target on pm? because i think your price target on altria is roughly where we are now, although you're upgrading it, we're kind of at the $33 you've targeted. >> i most recently targeted pm just about a month and a half ago. the stock is on a rise. >> so you think it's not already in the price? >> when you look at my price target, i think it's conservative based on our analysis that we did on asia, which is our most profitable business unit. look at china as a coal option. >> are more and more people smoking in asia/china. >> and keep in mind, they're the only ones with a part for ship in china. and there's so there's a kpetd tiff advantage there.

i think px m will be a strategic partner. so you own the -- >> the pm and mo, pm as a dividend yield of almost 5% at this point. what's the track record for those investors. >> dividend payoff is about 80%. they do grow in line typically with earnings, so i think that's something you can count on, they're very secure and they generate so much free cash flow, these tobacco companies. >> they also kill people. here in the united states, it's always been the roll of the dice. is there that risk in asia? >> there's limiteded risk, there is litigation risk that you have to consider. there's also regulation that one should consider when you invest in these stocks, so certainly, yes, the risks are known. there's plain packaging restrictions in australia, that's a lot of advertising restrictions.

i think this is still something that a lot of consumers enjoichenjoy, especially with the marlboro brand. why are the gas prices so high? plus how expensive oil can actually put money back into your pocket. all of that, imagine that, all of that, after the break. ♪ when your chain of supply goes from here to shanghai, that's logistics. ♪ ♪ chips from here, boards from there

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citing -- let's mark downgraded to market performer, the firm crites the lack of future revenue growth. the price target is also being cut from 46 to 38. and mgm resorts, added to select lists, improving las vegas trend setting. crude oil is trending right here a five-year high. there's an oil boom here in the united states. so what is a the deal with the pain at the pump? brian shackman is here to help explain what's going on. kbrin? >> that is the head scratcher with energy, what is going on? i'm going -- epperson will answer that. as we have seen, domestic production continues to rise in the u.s., up more than 15%.

you see the projection here, all the way up to 2013. possibly 7 to 10 million barrels per day in 2020. those are some blue sky predictions. we're now a net -- then you look at demand, there's a lot of debate on how to actually gauge demand. over the same period that i just looked at, the u.s. has seen a pop in oil production, gasoline demand has been tepid, you see up in '08, the gradual decline pretty much ever since. the data covers all purchases at 100,000 stations. now we go to gas prices, production up, demand down, so you would think prices would at least moderate. it hasn't? the most striking way to look at this is to go back ten years, you see ten years ago in march, 1.29, we go to the last few

years, where it hits that all-time high in 2008. and today's aaa average is 3 .90 shows that record could be in jeopardy in the next few months? how do we -- sharon, who's the pro in energy has that question, why, which is a lot of people want to know the answer. >> a lot of people can't understand it based on what you just showed. but they need to understand there's a big reason why the nation's producing more oil and prices are not falling. and that is because it's not so simple when you look at gas prices. it depends in part on where the oil comes from. oil is a commodity that's used globally. similar places reflect supply and demand locally. that's what we're seeing with the wti contract. those wti futures are reflective of that and they're about $18 cheaper than brent crude oil that comes from the north sea. that supply has gotten tighter and it ships to refineries across the east coast.

look at the ones that are in the red. here in the east coast, there's greater pressure and greater premium on processing gasoline. now the closures of the conoco phillips and trainer, those together with sonoco philadelphia refinery, that's going to be shut down completely, that's about 50% of the refining capacity. that fuels and ships full supplies to six east coast states that. tells you why the result is a big divergence in gas prices, because inland prices reflect wti. you can see in wyoming, for example, it's under $3.50. but along the coast, the prices are running near the $4 level. whoempb you look at all these prices together, you get the

national average, that's $3.90 a gallon. just 20 cents shy of the all-time high record in jury room of 2008. now with the summer driving condition right around the corner, we could easily top that record. >> so can we stop the refineries from shutting down? why are they shutting down at the same time? >> they are shutting dawn because refinery margins have been so low. we started to see a slow pickup and that has added to a lint of increase in the prices in the last week or so. but many were just not making the money that they wanted to make or should be making. that's why we have seen executive leadership changes in some of the major refineries as well. >> sharon epperson, so from well head to tail pipe, what parts of the oil to gasoline process provides the best way to capitalize on higher prices,

darrin sharingo joins us, the how do people make money out of this situation. >> there's two situations going on in oil, which is really driven by two factors, demand. it's a demand driven equation. the second is it's increasingly more expensive to find incremental supply and bring it online. the demand factor will drive the price higher. when we look at oil, the world better be ready at $100 oil. >> so exactly what do i invest in to make money now? >> the other part of it is really the natural gas equation in the united states. right now we have unconventional shale plates that are off the

beaten path and not really known for energy production. what we see with the keystone pipeline. we need a lot of energy structure to bring energy to the u.s. infrastructure. >> so you like the pipeline play? specifically in master limiteded partnerships which are sort of like the utilities of the oil industry. it doesn't matter what the price is, they're transporting it, that's how they're making money? >> it's also a growth part of the industry, if you look at the amount of infrastructure you're going to need, it's a tremendous way of capitalizing and making money from energy in the united states. and it has some safety elements as well. >> also through terra tile nitro again this one actually transports net gas? >> tera nitrogen is primarily overlooked by the market right now. and tera nitrogen is actually

fertilizer clay. a lot of people when you think of mlp's, you think of pipelines. so that's where tera nitrogen fits into the equation. >> and lynne energy is -- >> it's an exploration and pipeline company. it's a natural hedge against rising energy prices if we're right in the long-term trend is oil prices are moving higher for the reasons i mentioned earlier, lindh energy is an excellent way to play it. without having to due to hedging and long-term contracts, which is very important today. it's almost impossible to break where oil's going to be. >> at what point do these prices actually impacts demand? do you just keep buying these issues? >> when will it impact demand? i think what melissa made earlier is the pipelines are take or pay.

the commodity infrastructure or the commodity plays at mlp again are underplayed in the commodity commodity mlps. it tracks a basket of 25 securities or partnerships that are well-diversified. the underlying index yields three basis points higher than infrastructure mlps. >> what was the ticker symbol? >> ymlp. >> thank you very much. >> team coverage continues on the economic impact of skyrocketing oil prices. be sure to catch "fast money" at 12:00 p.m. eastern. we'll be looking at how hedge funds are playing the surge in oil prices and if individual investors can get in on their strategy.

all right. sticking with gas prices and the imact on consumers, we'll talk big oil with joe petrowski. [ male announcer ] how do you trade?

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♪ ♪ ♪ all of those winners powering a rally for the dow as well as the s&p. we're up by more than 1%. as for the nasdaq, we're higher by more than 1%. with no thanks from apple. which is up by only .1%. let's get more on the markets, bring in warren myers of dme securities and a cnbc market analyst. warren, the rally is laced with irony. because it seems like investors would rather have a questionable economic recovery and low interest rates as opposed to a strong one with that froms being taken away. >> what you have to separate is the economy versus the equity markets. i think what you're hearing from bernanke is they're going to do everything they can to prop this equity market up. even though it may not be the best thing for the economy, the equity market is taking this as

a very big positive and that's what's happening today. you see great reaction off of bernanke's comments this morning. >> did you immediately know this would be the market reaction once you heard the words coming out of ben bernanke's mouth? >> as long as there's potentially more stimulus coming, then that's all the markets need to hear right now. >> i hate to belabor a point, but volume. last week we had more low records again so to speak. i mean what does it say, if anything about what's going on in this market? >> it tells you a lot of people are not participating first of all, i think the average investor appears to have taken a step back after what they went through from '08 -09. >> you can't blame them, can you? >> no, effectively the chairman of the federal reserve are saying things are so bad we're going to keep on artificially stimulating the economy. you know, right-thinking people will go well maybe that isn't the best time to be in stocks. maybe this is an artificial market. >> i agree with you and you can

understand why they might think that. i think what we need to get the volume back up is we need to get some leadership coming out of the s.e.c., some regulations that make it a fairer game for the average investor. >> do you think that's what's needed here? >> i think so. >> just a return to growth would be good, a return to employment. >> that's a bigger long-term project. but i think if the s.e.c. went up and went after the individual investor and tried to convince them that this is a fair game and a fair place to trade, you might get them to jump back in a little bit. >> you're talking about historically lower interest rates, and yet it's still not enough to motivate people to go out on a risk curve. they would rather buy high-yield bonds than stocks. >> what does that tell you? >> it is tweet time, former goldman employee greg smith in the headlines, looking for a book deal. we're asking you guys, what should he title his book? i'm sure the responses will be rich. so tweet us, our handle i

is @cnbcsquawkst. e going to have you taste. the first one we're going to call x. r r and then let me know what the baby thinks of it. four million drivers switched to this car insurance last year. oh, she likes it babies' palates are very sensitive so she's probably tasting the low rates. this is car insurance y, they've been losing customers pretty quickly. oh my gosh, that's horrible!, which would you choose? geico. over their competitor. do you want to finish it? no. does the baby want to finish it? no.

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time to squawk on the tweet. the former goldman sachs executive who resigned this month and condemned the

investment bank in a skating "new york times" op-ed is seeking a book deal. the "times" reports that greg smith has met with several publishers and the book is being pitched as a banker's coming of age story. that brings us to today's squawk. what should greg smith call his book. one tweet, how i won and lost the hearts of americans in sage week. one tweet, my life with the muppets. and another tweet, how i made my millions. before becoming pc. the life cycle, the banker. good responses, everybody. david always great to have you. see you again. >> i'll be here tomorrow morning. >> i'll leave the 11 to the two of you and i will see you tomorrow at 9:00. >> we'll see you at the european close. meantime let's get to it. here's what you missed if you're just tuning in. welcome to hour three of "squawk on the street."

here's what's happening so far. >> this is not a year in my judgment, about strong economic growth or strong earnings growth. it's about a reduction in the fear premium, the crisis premium. >> i give it a chance that this could be a turning point. but i'm not saying it is. i think it's still too uncertain to call a turning point. >> the federal reserve's accommodative monetary policies by providing support for demand for the recovery, should help overtime, to reduce longer-term unemployment as well. >> i always find it somewhat surprising that his script doesn't change in light of some good news that we've had in the u.s. economy. >> refining oil has to be imported in the northeast even as it's being exported in the southeast. we're so far behind in infrastructure. >> we failed to open up our ipo properly. we had a software bug that locked up our engine and we weren't able from our roll into continuous trading.

>> take a look at the opening bell here. c nns real-time exchange. seeing green here. >> another miss on housing. pending home sales fell 0.5% in february. this is based on contract signed not closings. >> what are you expecting from the supreme court? >> well, i think most likely the supreme court will uphold the accountable care act's individual mandate and the medicaid expansion. i do think there is some risk that they could overturn each. >> good morning, markets are in rally mode here at the nyse, let's get you caught up now. we're seeing about 1% gains in the dow as well as the s&p 500. the nasdaq is higher by 1%. no help to the relative underperformance of apple, which is up by only .1% right now. we're seeing big gains in other big-cap technology stocks. microsoft up by more than 1.25%. oracle up by 1.5%. health care stocks getting a boost as president obama's health care overhaulhaul goes be the supreme court.

tenet, aetna, united health and humana in the green. one of the biggest losers, safeway, credit suisse expressed western over the grocer's ability to perform. pain at the pump, gas prices jump 11 cents over the last two weeks. we'll be talking live to the ceo of gulf oil about what he sees for oil prices and in particular, gas prices going forward. plus, "the hunger games" devouring the weekend box office with a record $155 million. a major bull's eye for lionsgate. you still have time to get in on this red-hot trade. if the stock is still a buy and how movie theater stocks could benefit as well. markets overseas riding high on the back of ben bernanke's comments earlier today. how it shakes out when the european markets close in less than half an hour's time. and can apple save best buy?

the electronics retailer riding the apple wave. is this a sustainable rally? the answer plus much more coming up over the next hour. but we start with an historic day in the country of cuba. pope benedict making a visit to the communist company that many believe sits on the edge of economic reform and could mean millions in revenue for the united states of america. chief international correspondent michelle carrera is live with more. >> cnbc doesn't normally cover papal visits but we wanted to come here because it's one of the few times that cuba will let us in. one of the last bastions of socialism in the world. we'll get to more on that in a second. first to tell you about news related to the pope's visit. venezuelan president, hugo chavez arrived over the weekend. he, where he was greeted by cuban president, raoul castro. chavez called into a venezuelan tv broadcast saying he was here

for five daily radiation treatments after having a second cancerous tumor removed from his pelvis. we know he's met with the pope in the past. there is a longstanding embargo against cuba, meaning u.s. companies are strictly prohibited from doing any business here. however, there are some exceptions. specifically, agriculture and medicine. in fact, last year, u.s. companies exported $347 million worth of agricultural products to cuba. pat wallace is a bean exporter and the president of west star food. and in cuba, beans are a big business. ? the cubans do love beans, the consumption is the highest per capita of any country in the world. so they eat a lot of beans. >> some of those beans come from wallace's packaging facility. but this isn't havana, it's corpus christi, texas. with. >> when i tell people, they ask

what your company does, and i said, we export some beans to cuba. they say, you can't do that, can you? >> he not only can, he has for nine years, filling sbin container ships with bags of north dakota beans. >> the last shipment we did was about $3.2 million. >> texas a&m has done a study two years ago, saying if the embargo were to go away, exports would double. please tune in tonight, cuba, forbidden fortune on cnbc. we've put together a terrific program that looks at the issue from an economic angle, rather than from the strictly political angle which has been full of strident discourse over the last 50 years. update on the pope's schedule, he arrives in santiago today, he visits the most important cuban shrine tomorrow and meets with raoul castro and is here in havana on wednesday in the plaza of the revolution. melissa, back to you. michelle, thank you very much for the very important

story. meantime, we've got to go back to gas prices. the national average price for a gallon of gas, jumping 11 cents over the past two weeks. at a record high for this time of year. gas prices peaked or will they go higher ahead of the summer driving season? joinings us now, joe petrowski. you have never been shy about predicting where gas prices are headed. the u.s. government is saying an average of $3.79 for the year what do you see in terms of the average and the peak that we'll see this year? >> i think we're going to move moo the $4 territory on a national average. i think we'll probably go to the $4.30, $4.40 level sometime late spring, early summer. >> pras predicated on that forecast? do we need to see potential conflict with iran still brewing? the sort of state we're in right now? we need to have the premium built into it plus the economic growth we're seeing right now? >> i don't think the premium will ever go away.

whether full-scale fighting erupts, then i think you'll have $5 handle, if fighting and actual military exchange. but i don't expect that. nor do i expect it will close off supplies long-term. i think world growth alone can put it to $4.30, $4.40. unless there's a perception that we really are committed to opening up federal lands for drilling. we addressed the bottlenecks in our system. which are considerable. and including the jones act, which stops the free flow of oil from port to port on foreign flagged vessels. unless we take those measures, then i think easily the growth is going to take us to the $4.40, $4.50. >> at what point typically, joe have you seen demand disruption set in? in other words for people out there, when the price is actually influencing them to cut back because it is so high? >> we saw did in '08, right? about $4.20.

it was about $130 on crude. even though we topped out at $147. we saw some things where the average pickup went to eight gallons from 11. sales inside stores, and we have 600 retail stores started to get impacted by high gas prices. today i think we can go a little higher. the economy is better. we are in a recovery. we've come off a very warm winter. so i think that threshold pain point is a little bit higher. we are seeing it today in places like florida and places where there's more blue collar demographic. we're starting to see some of the stress. but nothing like we saw in 2008. >> and in terms of the impact of the pipeline that will be built to move wti from cushing to the gulf, do you agree with many oil economists that it will actually raise the price of gasoline further in the interior part of the country by what, 10 to 20 cents a gallon? what do you see? >> well it certainly will narrow the differentials which are all-time highs. but overall, it's going to lower

the cost of oil on average. nobody invests $7 billion to $10 billion in infrastructure to raise the prices. so it's a positive for the u.s. but, yeah, with the oil spreads between kansas city or denver, narrow up versus chicago or new york, yes. but overall, it's good for the country and gives you a lot more security when you have that infrastructure to move the commodity from where it is to where it isn't. >> and joe, you mentioned the retail part of the business. the convenience stores that are attached to the gasoline stations. prices where they are now, are you seeing consumers make that choice? oh, i'm spending more at the pump, so therefore i'm not going to buy the extra snacks or the danish or the cup of coffee in the retail store? are you seeing that tradeoff happening right now? >> most definitely. again, by region, depending on the demographics of the region, but you're seeing it quite a bit. you're seeing a switch to

private label products from branded products, less conversions, what we call conversions in the business, people that come in the store when they fill up. and the average ticket basket is slightly off. so you're definitely seeing some signs of retail stress. because of higher prices. but again, nothing to what we're seeing in 1980. but you know, who knows? >> joe, we're going to leave it there. thanks for your time and candor. appreciate it. joe petrowski, the ceo of gulf oil. >> thank you. straight ahead, "the hunger games" is officially a box office blockbuster and lionsgate is reaping the profits, should you buy the stock today? find out if the odds will ever be in lionsgate's favor. i'm consolidating my assets. i'm not paying hidden fees or high commissions. i'm making the most of my money. and seven-dollar trades are just the start. i'm with scottrade. i'm with scottrade. i'm with scottrade. and i'm loving every minute of it.

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"the hunger games" devours $214 million in its global debut in u.s. and canada. the mafvy had massive opening of $155 million, the highest open for a movie that's not a sequel and the third-highest opening movie weekend in history. new series of "mad men" debuted over the weekend. lionsgate shares are trading higher. $14.97. where does lionsgate go from here to maintain its growth?

monica dezenzo is an analyst with jp morgan. >> we have to say we're excited about the results this weekend. i think even if you strip out what "the hunger games" has done, the company has a very stable outlook going for it that's why we still continue to like shares here. >> a lot of people might knock movie studios because we leases are lumpy. you don't know what the next one is going to do. in terms of the pipeline, ha does lionsgate have in the pipeline that will sustain the trajectory? beyond today, the stock goes up 75% this year alone. >> surors i think it's a few things to look for, we want to see how the second weekend does, we're looking for about 70 million in domestic box office, if it can exceed that, i think you're talking about a film that has 400 million in domestic, which probably raises estimates a bit. right now we're looking for about 1.5 billion in profits from the franchise to lionsgate over the next few years. that could be conservative.

>> give us a sense of what it cost to make this film. because as i understand it, it didn't cost that much. >> sure, that's one of the things we like about lionsgate. they have a relatively conservative production strategy. we're talking about 80 million production budgets after some tax benefits from filming in certain states. about 45 million in p & a, which for a movie, that's hitting all four quadrants very inexpensive, ahead of a very successful marketing campaign. ahead of online media. >> four quadrants meaning male female, above and under the age of 25. in terms of what they do have in the pipeline it seems they've hit on the strategy of producing sequels basically or parts of trilogies. so there's a franchise, it's not just a one-off but there's actually a pipeline to come if one is successful. >> they've been doing this to some degree with tyler perry's movies and their "saw" franchise. when you look at their slate is a significantly expanded

franchise slate so when you look at last year fiscal 12. we saw two to three franchise films. upcoming in this year we think there will be about eight. that's significant, because the films traditionally do bet anywhere box office. when you think about the downstream benefit. whether it's home video, potential tv opportunities, it's much more meaningful. as we look out, we would highlight "what to expect when you're expecting" in may, as well as "the expendables" and "twilight" in the fall, big franchises to come. >> i would guess you're up late to watch the "mad men" premiere. >> it was great to see them back on tv. >> will that be a lift? tv production last fiscal year was about 22% of revenue. do you expect the pie to grow? >> we do. they used to mainly be focused on cable and have great success there. what you're seeing is them expanding, they have some pilots that are for the broadcast networks. they have a show that's slated to air on netflix as an original program and my favorite to talk, about charlie sheen's new show,

"anger management" on fx this summer. which if it gets picked up could be meaningful for profits. >> you've got a price target of 18 and the stock is trading at 15. that's your 12-month. any feeling to increase your price target? >> let's see how the weekend comes out. we're looking for 315 now for hunger games for domestic box office, if the next weekend looks really strong, then maybe it becomes 400 million. they've covered all their expenses, that just flows through to the bottom line. think that's where you see upside. on the tv side, i think probably numbers have not baked in the upside potential from "anger management" and some of the other franchise films they have coming out. it's an interesting time when you dig into the details in this company. >> thank you for your time. coming up, how movie theaters can benefit from monster hits like "the hunger games," which ones you need to own ahead of the summer season. and we're counting down to the close in europe, only about 12 minutes to go here.

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the the rally continues here on wall street with the dow and the s&p 500 up by about 1%. the nasdaq is up by 1% as well. strength in cisco, oracle, red hot. the one pocket of weakness if we're to poke a hole in the rally is the home builders, 1% declines across the board. pulte down by 2% off weaker-than-expected pending home sales data. but a broad-based rally on our hands. "the hunger games" debuting with $155 million in sales in north america during the opening weekend. how will the movie theaters fare as summer movie season rolls around? barton crocker joins us with his take. in terms of hunger games you have increased what your first quarter estimates were for the industry box office because of it you say that the second quarter is going to be weaker. doesn't "the hunger games" straddle the quarter?

shouldn't we see a boost in second quarter? >> the it does help april. but the the most important part of the second quarter is the leading into the fourth of july weekend. we have very tough comps. "pirates of the caribbean" in the spring. the first quarter has been tremendous. i think you'll you look at theater stocks and arguing for about 20 million upside in ebitda. ten cents or so on eps. with the theater group we like sinemark has nice latin american growth. the best days are behind us. for the next few weeks in the box office. you know as we work through "the hunger games" slot. >> are there changes? >> a movie like "the hunger games" benefits everyone. it's good for a couple of names we don't cover like imax. obviously helpful for one studio named lionsgate. the big theater chains, ci

cinemark, regal, they benefit from a big movie like this. >> what can they do to manage the lumpiness of the box office? >> there isn't a lot you can do. but as an investor, you can play against expectations. so last year we had a terrible box office. this year we have a great box office against an easy comp. i think that you can look for the opportunities when the box office is weak and buy more. there's a bear argument that people don't go to the theaters any more. movies like "the hunger games" show us that young people still have the movie habit. >> when people think about dividend payers, they don't think about movie chains. if we were to do a cross-section of the movie chain that you would buy now in the highest dividend payer, what would the stock be? >> national cinema theater advertising and regal at 5% to 6%. i prer cinemark at a 4%

dividend. because they have a better growth story. anchored in latin america and the u.s. they're all good companies if you're looking for a dividend name. >> barton crockett of lizard. the closing bell about to sound across europe. we'll bring you the closing action live after this. [ male announcer ] how do you trade? with scottrader streaming quotes, any way you want. fully customize it for your trading process -- from thought to trade, on every screen. and all in real time.

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minutes away from the close across europe. let's bring in minutes away from the close across europe. let's bring in simon hobbs as we count you down. >> the europeans have moved their clocks and we have the european close as we count you out. the major story we've got so far is the rising tensions in europe that characterize last week within the last two or three hours have been receding tension, partly because of what ben bernanke said with an indication that rates will stay lower for longer here. therefore, more accommodation in the system.

but also because angela merkel has importantly indicated she is prepared to back down. there will be the two bits of the firewall coming together and maybe she will make move. the germans will allow europe's firewall to be greater. you see the way in which the european markets have gained as we come now to the close for both of those reasons. very importantly, and if i show you where we are on the foreign exchange markets, bernanke's comments are dollar negative. you see the greenback down across the board. merkel's developments are euro-positive and quite dramatic move higher here on euro/dollar as you can see as a result. a symptom of what is going on. last week of course, all the talk was of rising yields certainly for spain and italy. and if we have a look at where we are on the yields, the yields have been coming down during the course of today's session as a result of what merkel has been telling us. let me take you over to where we are in spain. now there's no question that

there's big problems, potentially in spain. hang on, the bells are coming, let's get those and we will return to spain in particular. here we go. >> the european markets are closing now. >> the important thing here is to see how spain is really almost on its own with negative territory. you saw over the weekend that the spanish prime minister didn't get the political results he needed, which was the southernmost tip of spain. that autonomous region. it's a big week for the spanish as we question whether they can pull in the austerity. he's going to present the budget on friday. the important thing to note is how we've improved on the situation during the course of the session. the spanish market led by the banks was in negative territory and you can see the way who is those losses have been cut during the session. i want to mention one last thing to you. it's a note that you might have missed on friday. that came out from citigroup. and they are suggesting that at the core of europe, it may be that the dutch, the netherlands are no longer core europeans.

because of their budgetary situation. and you've got bankers trying to peel apart the eurozone one by one. this is the extra premium that the market requires to hold dutch paper as you can see, over german bunds, and you'll see the way in which it has been rising. question, will the dutch become a problem further down the line? >> back to you. >> simon had mentioned the weaker dollar across the board. that's helping the commodity trade. particularly the gold trade. let's send it over to bertha coombs to check out how the commodities are trading now. >> we've seen oil come back a little bit off of the highs of the morning. but still holding in there. wti nymex up about a dime or so. but you've got to be watching these days is the brent price, capturing concern about iran's oil supply to the world sort of dwindling at those sanctions take greater effect. and also this morning, some confidence with regard to that german confidence number being

fairly strong here for several months running. and that's feeding into the gasoline prices. arbob, the reformulated gasoline contract is actually the best performer in the energy space and the cftc saying they saw record open interest in the rbob contract. today if we continue at this rate, we'll close at a new 2012 settle high. but as melissa noted, gold this morning, really extending gains. we had a huge pump-up last week. it's up again today, leading the metals complex. it's a debut for options exploration and options trading. back to you guys over at the nyse. >> bertha, thanks. let's bring in bob pasani. and broad-based rally. nice performance put in by financials, materials, industrials. >> i'm a little worried, though. because i'm the old real estate reporter and i watch the housing numbers and pending home sales

today. now look occasionally you get the weird numbers, i'll throw it out, you get outliners below expectations. take a shot of this. i watch trends here. get a tight shot of this. pending home sales are now below expectations. then last week, new home sales below existing. existing home sales below expectations. housing starts below expectations. on friday, we had kb home come out and say we missed the numbers by this huge number. orders were down 8%, expecting orders up 20%. at some point even i can detect a pattern, folks and that's when i start saying i'm a little worried now. i want to see better numbers than we're putting up. you can see what's happened, obviously other investors are aware of this. look at the itb, the etf for the home builder. what you want to see here is they figured this out last week this is one month. for the last several days, even as the s&p is hitting new highs, home builders have been trending down. because they're concerned about exactly that full screen that i just showed you. again today the home builders are to the down side.

kb home got clobbered on friday on the outside surprise. you can see it's continuing to underperform the rest of the market. down over 4%. the bottom line, home builders are starting to roll over as the data looks less certain for a spring home buy. quarterly rant on stocks versus bonds. when if ever will we see movement here? again you see the s&p 500 up 12%. second quarter in a row. up double digits, the bond fund, biggest bond fund we've got in the united states is trading down. was flat last quarter. when are people going to pull money out of bonds and into the stock market this makes me completely crazy. we have not, we're going to get outflows again in this quarter from equity mutual fund flows. we have had the last time we had inflows was last quarter, first quarter of 2011. you know what happened in the second quarter, they got clobbered. in 2008, before that, there were no inflows, there have been no

inflows into equity mutual funds since the beginning of 2007. you wonder why i pull my hair out. obviously things have been very difficult. two quarters with double-digit gains and still the public doesn't particularly care. >> the flows into etfs are quite strong. >> the problem is, by at large, the exception most of the flow is professional flow. still not a lot of private retail investor. >> bob, thanks for that. breaking news on regeneron and amgen. >> regenoron and sunofi releasing new data on their injectable treatment of cholesterol. indicating it cuts cholesterol levels better than statins alone. it would be aimed at patients who need more than just a statin to bring their cholesterol down. now regeneron is best known for its drug that treats a leading cause of blindness. company shares have doubled to the $115 level since approval last year.

and that run-up came before today's news. keep in mind, regeneron may not be alone in this sector for long, amgen has a promising new injectable entering phase two trials by year end. amgen reporting that early clinical trials indicating that their drug could cut cholesterol levels up to 66%. the market potential huge here. and estimated nine million americans are deemed at high risk of heart-related problems. half of those patients may need more than just a statin. melissa? >> thanks for the update. more on the early trial results of these next-generation cholesterol-lowering drugs. let's bring in tony butler, a managing directoror and pharmaceuticals an analyst at barclays. i'm sure a lot of people out there take lipitor and are wondering if the new injectable cholesterol-lowering drug is more effective. is that a way to think about this in this arena?

>> it's certainly possible and it's more effective at lowering bad cholesterol. that's what the data proved. but there are two points we need to be sure to remind investors about. number one is so far, these drugs have been in very small numbers of people. we really do need large populations to make a judgment about their efficacy versus standard of care. for example, versus lipitor and number two, we need to make a judgment about safety. physicians in chicago at the american college of cardiology are actually enthusiastic. but they remain reserved. the key is, these drugs are still in early development. they would like to see results in late development after they've been in the large-scale number of people. >> and in terms of who might take this drug, and i understand that this is very early. we don't know how efficient. but trying to get a sense of what the potential of this drug could be. would it be for the people taking lipitor? trying to understand if it's going to replace lipitor in any way? >> in some cases, it may

actually replace lipitor. there are a number of people who actually are intolerant to drugs like lipitor and therefore they need something else. number two, is there will be individuals who have multiple risk factors. melissa, for example they have diabetes and maybe they even have a history of having heart attacks. those individuals may not only need lipitor, but they also need something to get their cholesterol down even more than what it might be today in order to prevent the second heart attack. >> i understand that it's too early at this point necessarily to gauge the size of the market or how much these drugs could bring in. but in terms of what it could mean for these various companies, for an amgen, for a regeneron. tony, to whom would it mean the most? >> a great question. the likelihood is it would probably mean the most to regeneron. they do have a partner in sanfy, obviously regeneron being the smaller company. amgen may seek a partner as well. but if you ask me to pick one over the other, it would be

regeneron. pfizer also has a program using these type of compounds. and also, there are other ways to get at this particular issue, bristol and isis are actually using different strategies to try to attack the same molecule. >> would this be investible at this point in your view given how early it is? >> it would not be investible, because it is too early in my view. >> tony, good to have you with us. tony butler of barclays. straight ahead, the sectors and stocks you need to know to put the profit back in your portfolio. that's next. first some of the winning and losing stocks of europe's trading session. this at&t 4g network is fast. hey, heard any updates on the game? i think it's final seconds, ohh, down by two, shoots a three, game over. so two seconds ago... hey mr. and mrs. harris, where's kevin? say hi kevin.

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coming coming up on the halftime report. bernanke reignite the risk trade. what should you buy if bernanke has got your back, as old tech possibles and the nasdaq heads for its best quarter since '09, citi's mark mahanen joins us. now back to melissa. markets moving higher on bernanke's upbeat comments on the u.s. labor market and positive economic data out of germany. should you be buying into the rally or putting money to work during a pull-back? let's bring in david katz. chief investment adviser at

matrix advisers. it sounds like you're luke warm on the markets. >> we think the year is going to end higher, but you've had a great quarter on top of a strong fourth quarter so things are going to slow down and there's going to be volatility. our best advice is not to chase the raly. know that you like stocks and into any sort of weakness on any sort of concerns, you want to buy into that. >> the markets are rallying on these bernanke comments and the notion that rates will remain extremely slow for an extended, for even more extended period of time at this point. is that a reason in your view to buy stokts because the flip side of that is that the economic recovery may not be sustainable where it is, the pace of the recovery may not be even at this point? >> we think if you have an economic recovery and it continues, we're confident that's the case. we're comfortable with slow earnings growth. right now you're getting zero in money markets and very little in bonds. we think that stocks are attractive at 13 or 14 times earnings, the longer the fed

keeps rates low, the more attractive the stock market is and we believe the economy is gaining traction, so it should be a good environment for stocks. >> slow earnings growth and low interest rates, it sounds like i like dividend payers? >> we like a lot of areas of the market. our favorite group are financials, they were in the dog house last year. started to come to life. they're having a strong quarter. we think this is the tip of the iceberg. we think many investors are underinvested in financials, you probably have a multi-year period of good performance in financials. some of the bigger names like jp morgan, wells fargo, met life should be well positioned to do well in the next 12-18 months. >> tidewater and teva are two of your picks? >> tidewater provides offshore services to drillers. pricing has been getting progressively stronger. we think they're in for a two to three-year good cycle and the stock is selling at less than ten times normalized earnings.

teva is in the pharmaceutical sector, pays a reasonable dividend. we think they have better things in the offing. we think it should sell for 10, 11 times earnings. so you've got good upside. >> we spoke to the ceo of gulf oil who forecasted that gasoline prices could peak at $4.50 this year if we reach that at around the summer driving season, could that be a headwind for stocks? >> we do believe that it is going to slow the economy some and that would be a negative for stocks. we think we're going to muddle through it. and we think oil prices should be peaking around here maybe trend a little bit lower. not significantly lower and that's why we do own a number of energy stocks and we think that's also a good place to be. >> in terms of all of these concerns about china, david, just last week, everybody was in a tizzy because of the concerns about a china slowdown. right now we seem to be completely ignoring that. if that comes to the fore again, have we reached a point where we actually believe that there could be decoupling here?

>> we don't think there's going to be a decoupling. we believe that china's government has done a much better job than many other governments around the world of navigating and controlling their economy. including the u.s. we think there's going to be a soft landing. we think there's going to be some expansionary policies there and we don't think it's going to derail the global recovery. >> david katz of matrix asset advisers. last thursday we had krispy kreme's ceo on for earnings. we mentioned the company was lowering their forecasts as we attempted to explain why the stock was trading lower that morning. it was downgraded the day before from an equal weigh to overweight. the fiscal guidance for 2013 is 21 cents to 24 cents. lower than its november 30th 2011 range of 35 to 41 cents. solely because of an increase in its expected booked tax rate for next year which resulted from

its release of $140 million of deferred tax valuation allowances in the fourth quarter as required by gaap. krispy kreme's guidance remains at 31 cents to 41 cents a share. the stam as stated in its november 30th releers. we want to clarify that for you, krispy kreme stock is down on the week, but up on a nice pop in today's session. coming up, how apple could save best buy, the retailer seeing a 10% bump in stocks as the ipad went on sale. see how you can make a profit in both companies. [ grandfather ] that a boy!

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apple's move to make retailer best buy a major retailer. they're selling lots of the new iphones. according to new data released. the majority of iphone sales

come from carriers, at&t and verizon, but 13% of purchases from best buy. while the relationship is proving to be lucrative for apple, what does it mean for best buy? let's bring in brian nagel from oppenheimer. good do see you. can you walk through for the viewers the percentage that best buy may actually get from selling? >> we don't know for sure. but the assumption we go with is that the margin they make on apple is quite low. lower than a lot of margins on other products they sell in the stores. neither company has disclosed that specifically. >> the margin is low, is tht kind of thing they're increasing traffic, therefore the shopper will pick up the incremental dvd or video game or something else while they're in best buy buying an iphone. >> best buy benefits from apple, it's the traffic. an additional sale while they're out there buying the new ipad or bringing more people to the store. makes them think more about buy being a tv.

my view is that apple is not as positive. i think over time it hurts best buy in that it apple products tend to cannibalize sales of higher-margin products in best buy stores. >> so for instance they're going to buy an iphone, they might not pick up a smartphone that's available at best buy. or they may buy a mac book and may not be a laptop. >> exactly. the ipad versus laptop. so best buy can make more money on a laptop. >> where are we in terms of best buy stock? where are you, we seem to be in a no man's land when it comes to electronic sales for the year from a seasonal standpoint. i'm not sure that the fiscals for the second quarter is anything for best buy in terms of sales, it's not a holiday season. it's not driven by the super bowl, for instance. so is there just sim 34ri too much euphoria for the stock given where we were in the

calendar. >> i think the answer is yes. you're right, this is kind of a consumer electronics lull period. the good weather across the country is probably an incremental negative. people are spending more time outside. the final four is coming up next weekend. overall i think with best buy i think the stock is probably a bit ahead of itself. a perform rating, i think this bounce we've seen lately is probably getting a bit ahead of itself. >> where does best buy end up in three, five years? i mean we always sort of joke, but there's a grain of truth to it. it is a show room for the likes of an amazon.com. it's a physical show room for online electronic retailers. >> it's a difficult question to answer. i would think on the positive side, best buy is the largest consumer electronics retailer in the united states. this he manage their business very well. they've been buying back a lot of stock, paying dividend. the big negatives are there's a lack of a product cycle right

now. i think that's going to persist for some time. and what you alluded to, a lot of competition from amazon and online retailers where customers are using best buy's stores as a showroom. i think i have a lot of confidence in the best buy management team but they're facing an uphill battle and it will be a tough go from here. >> 3-d tvs were supposed tobtd the end all be all. nobody ended up wanting to spend that much money for a 3-d tv with the glasses. there's nothing else out there to capture people's imaginations to make them go buy something? >> tvs, best buy sells a lot of products. i look at it as, tvs are big component of their business. since the introduction of the flat panel several years ago, we haven't had a great second or third introduction. 3-ds in my mind it's as simple as the glasses. the consumer electronics show this year we saw a lot of really thin tvs, picture quality is incredible. i'm not convinced it's going to

cause people to take the flat panels off the walls and replace them. >> you cover a broad range of stocks. what's number one in your coverage universe? >> a stock called home depot. >> close to 52-week highs, you still like it? >> yes. and smaller cap, pier one imports. >> brian, good to have you with us. keep the tweets coming. question is ex-goldman sachs executive who famously quit with an op-ed is famously seeking a book deal. we want to know what you think he should title his book. we've got some of your ideas right after this. c'mon dad!

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the former goldman sachs executive who resigned is now seeking a book deal. the toems greg smith has met with several publishers. the proposed book is being pitched as a banker's coming of age story. what should greg smith title his book? one tweet, "confessions of a former muppet hunter." one tweet, "dog bites man" and one tweet, "fool's gold man"

want to go to hampton pearson with the latest on the supreme court hearing on obama care. >> today was day one of three days of hearings on the affordable care act. specifically in front of the justices. today whether or not they should consider the constitutional challenges to the health care act. because is the penalty associated with manndatory insurance provision. is that in fact a tax. if it's a tax, there's a longstanding law on the books that says you can't have a lawsuit until the tax is collected, which would be 2014. they heard two different views of that. yes in fact the law applies and therefore, perhaps if the court goes along, there would be an agreement on that but a strong case by both the government and the states, that, no, the penalty is merely, and the mandate are separate, they should not be considered as such and therefore, the court should decide one way or the other, this case. and specifically, the constitutionality of the indu