ahead of it. it's not good for us in the long run. >> it's been fantastic, thank you for being here. >> interesting stuff. >> make sure you join us tomorrow "squawk on the street" starts now. good tuesday morning, welcome to "squawk on the street," i'm carl with melissa lee and jim kramer, can investors reverse this four day slide? sentiment is shaky before the start of another earning season today after the bell. let's lock at futures today. looking for repair after yesterday's fourth ugly session, and as for europe their reopening after an extended holiday weekend. the spanish ten year is at the highest level since december. >> so after the rough ride for the last four sessions, the road map starts with the markets no

surprise. u.s. stocks look to open higher. losses overseas as investors in europe return from the long weekend. >> and a pivotal meeting for scott thompson today expe. >> a company with no revenue, instagram, is now worth more than "new york times." does facebook not know what to do with all their cash? >> and the president pushes the buffet rule today. a ploy to target mitt romney, or a attempt to make the tax structure more fair. >> investors are cautious before the start of earning season. analyst are expecting the company to post a loss in the first quarter.

typically alcoa didn't just miss. they really guide us there earning season. >> the stock is trading up in anticipation of what is basically an inline quarter. many people are shorting alcoa because they were close to capacity last week. they have never been signaling that anything is that good out there. melissa, here is my problem with alcoa. they are able to set the tone, and i think people think they can set the tone with the earnings per share. it's that they go through so many different kinds of markets. i urge people to go to alcoa.com to see what i mean. they can color construction, apple because they make the skin, they have to have a good day. >> weak aluminum prices, high material costs, are you

interested in the alcoa story or is it the hole in the donut. >> the think the ceo has done a remarkable job in a bad industry. china produces 5 million tons too much of aluminum, why? they're trying to keep people to work. and while they are overproducing it makes it hard on everyone. >> and alcoa is a higher cost aluminum producer. so it may not necessarily mean that their eps will come in inline just because of their costs -- they're good at managing costs traditionally. >> alcoa is in a classic bad industry. clen contrast with the chemicals. many can use lower prices. natural gas does use some -- it's a raw stock for some of

alcoa, and they make the turbines for many of the natural gas utilities, it's still expensive for them to produce aluminum. >> here is the headline on the money section of the "usa today" investors brace for low growth. do you think analysts have underestimated what the earnings will be? >> yes, i felt that supervalu would do a not great number because they have not done a lot of good in your opinions, and they reare a guy beganic food so -- maybe that is in sync with what you're seeing. goldman says the numbers will be below expectations. rbc says listen, maybe everybody is so down it looks up from here. i like when we come down into earnings season.

>> we will find out more starting tonight. in the meantime, yahoo is having a meeting on deck today to talk about reorganizing the company and speed up innovation. they trimmed their workforce by 2,000 jobs. a big e-mail goes out to the employees from scott thompson essentially saying we can still do this, is he right? >> they never lost what i regard as their core homepage, people go there. when i pass through the halls, i see people on yahoo finance. but 100 years ago, excellent coverage, titanic, the analogy stands -- >> wow, the way times cover disaster coverage or the way it sank. >> it was full speed ahead for the titanic. >> i think they have a core business like aol does. they have assets like aol as assets, but in terms of core

growth of earnings, they don't have mobile, they don't have social, they don't have cloud. facebook pays a gigantic amount for social. it's like nokia, once you fall behind in technology it's hard to catch up. >> serchlg revenues have gone down dramatically. it's down 37% last year. they were at 52% in 2008, and that would not be a big problem if display adds could pick up the slack. a big part of the business is starting to shrink and you don't have anything coming to off set that. >> what is their mobile strategy? >> haven't seen anything that would even lead you to a thesis or a theory. >> isn't that where the world is going in don't you have to have a mobile strategy? you have iphones and they're so

powerful. it's just hard to try to catch up with the technology. hardware mobile is so powerful. i heard yahoo has a desk top company. >> isn't the fight between dan lobe and shareholders hold the seed for something, a upside catalyst the way that some investors bring. >> yes, and i know there are parts worth more than the whole, but as we saw a lot of price target upgrades in aol, i was searching what is their core power. if yahoo gets rid of the assets, what's their core power? >> that's a huge question, yahoo has a market cap at $8 million, and instagram is $1 billion. >> a lot of people i know are saying isn't this the ultimate

trade for facebook. they have to block google. they're playing with a different currency. i think this is the beginning of the trade. i'm not a seller of social media. because this is like 1998 and 1999. it continued for longer than people realized it would. >> let's get the details of this big deal. largest acquisition and what could be a turning point overall. facebook buying instagram for $1 billion. instagram does not generate any revenue, and only has 13 employees, and no revenues, and it gets $1 billion. more than half of yahoo's market cap, more than the "new york times." >> this is a great chart we got.

12, valuation we have been through. founded in 2010 verses 1851. >> let's say it's a patent company. i'm saying what were those aol patents worst. i thought they were worth $100 million, and suddenly it's a billion. this could have been fabulous for google. obviously they were paying more than a couple weeks ago. we saw this exact same thing let me give you some history. i founded thestreet.com in 1996. the value doubled and doubled again. it is worth farless. i know that. this could turn out to be less, but it's worth more to facebook than for it to not be taken by google. >> so you think they're acquiring assets just to deny google the asset. is that healthy?

is that good? >> i think the market has a lot of work. we saw that with yelp. let's go back to what you said by talking about the valuation of the "new york times." that is the valuation of a good college because they're about as profitable. when you look at 1983-1985, we look at how coke is worth more than gm. again, i'm not trying to justify this price that facebook is paying, because they're playing with monopoly money, but i point out there are periods where we see a changing of the guard. google is worth a lot of money, apple is worth a lot of money. hard to value because it sells at two and a halftimes of the 2013 earnings. you want to sell facebook now? that ipo will be great. >> do you think when you put together the aol price of those patents and the price that

facebook is paying for instagram, is this a bubble in any way? >> when you blow bubbles they start out small and then they get big. the question is where are we in the bubble formation? it's not that we're not having a bubble -- >> because it's not an event, it's a process. >> right. if we call it a bubble right now that's about to pop, and facebook -- i don't know a single hedge fund or mutual fund that doesn't want a 10% allocation to facebook. maybe that will produce the bubble moment as opposed to these kinds of transitions. >> let's get to our "squawk on the street" question. what does zuckerberg know about instagram that the rest of the world does not. >> when he says, jim, that we don't plan on doing this a lot, meaning big -- this is the biggest acquisition that we know of, they made 23 of them do you

believe them? >> it's greater fool. i think -- you're playing with not real money. and that is greater fool. because most companying are playing with real money. we look at a trance action, some of them that we have seen where companies are buying other companies are playing with real money. facebook has the luxury of playing with not real money. >> because they're private they have this big deal, when they're public they won't. >> when you're raising $100 billion, $1 billion didn't seem that bad. >> absolutely undenial, but where are we? i think some people would say you have to sell everything right now. i struggle with that because i see -- is that why you would sell ross stores? is this why you would sell mcdonald's or nike. is that why you would sell yelp?

>> interesting, good to watch. when we come back, it's the controversial clothing company with backers like george soros. we'll sit down with the ceo of american apparel. four down days on the dow, and you never know. a lot more "squawk on the street" when we return. ng? get ahead of it! one phillips' colon health probiotic cap a day helps defend against digestive issues with three strains of good bacteria. hit me! [ female announcer ] live regular life. phillips'.

to get more bearish, there are lots of factors that contribute. think spain, think the issues in europe, and today, well for the next couple of days, we're going to have supply in the u.s. we know there has been a lot of corporate supply, and has the

journal pointed out, but today it's 32 billion, today threes, tomorrow tens, this will give us a very good glimpse into investor demand when there is little demand in europe. >> thank you and welcome home by the way. we're watching shares of apple, could be the second company to reach the $600 billion market cap. of course, it would be the second, as we mention, only six weeks after it hit the $500 billion market cap. >> here we have earnings. the facebook greater fool theory is harder to hold up under the scrutiny of apple. a guy still thinks it will earn $ $50. i will i will point out that people were hoping in at and t.

why would you have a phone launch on easter sunday when most of the world celebrates easter sunday? >> even costco was closed. we will see an unbelievable documentary. >> i did see some -- chris parnel toting the lumia -- you don't have high hopes for it? >> again, i always come back to it's anecdotal how much everyone i know loves their iphone. it's not so much better to beat the e koe system of apple. >> it's not just iphone verses android smart phones.

isn't that the game here? nonapple against another particular smart phone? >> verizon pushed the android very hard when they didn't have the iphone. a lot of it is carrier support. there is a love for the android, but it's not a big profit maker for google. they have not been able to monetize it. instagram is trying to get in ad in there that will look at. has anyone pressed an ad on word with friends, i almost pressed one by mistake it was a tragedy. >> for no ads, please press that. i'm afraid to press that, it may be a no ed for an ed. >> a tricky market, picking the right stocks is more important than ever. look at the futures once again. we'll have more straight ahead. ♪ the lines, and the paperwork.

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andr . ♪ >> eight minutes to the bell, we kick it off with harry davidson. this is the ultimate consumer digressionary product. you don't need a motorcycle. >> most people don't. >> this is what makes this job so tough right now. yes spain is terrible, the italian market is bad, why are

people guying these? their separate issues. used harry davidsons is a great market and getting insured used ones. the value of the stock is going up. >> is it the same as the equipment market where used sales pretend good, on the market sales of good ones. >> yes, very much. i find this so interesting about this kind of call. when we were here, not everybody was that positive. now we go up here and suddenly people like it. we have to keep in mind this is a late call perhaps. >> we're looking at sales of three different properties and analysts are saying they got good prices. >> i was talking with kate kelly yesterday in the hall, and i said i need to see big sell off of assets. i come in and a giant sale of

assets. a bunch of guys saying this is going to save them in the end. they're not in feteetering. we see though prices everybody in gas. >> yeah, dan said even by the end of the year, he said nat gas prices will come back, but he will see $2.50 by the end of the year. >> we're not moving so quickly. we saw a lot of guys talk about west port of late, and i think those are interesting specks. we saw rick santelli talking about the conversion of an f-150, but you needs these things to accelerate quickly. phil had an amazing report about there is only 2 nat stations in chicago. >> that will take a lot of build up that we don't have in

progress right now. so much more to watch. >> the opening bell just a few moments away. get ready for another big day of trading and a lot more "squawk on the street." this is $100,000.

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back at post nine, you're watching "squawk on the street." the opening bell set to ring in less than two minutes. >> this is a steady drum beat arnold aig. deutsche bank said they're going to buy back a lot of shares this year. so that is pushing aig stock higher, so the latest analyst call on aig. >> translator: ceo on mad money bought the stock three days after. why? he is talking about the got

ties. wells fargo says there are only two remaining government links. they're doing a lot of things to be able to separate themselves from the government. ben is a remarkable exec, and people are underestimating how quickly they can get out of the government clutches. >> he has had a good record this year of 23% in the first quarter of t 2 funds, so another investor loading in here. we're watching apple in the premarket and we should check that, 64354 is the magic number. right now we're poised to open about 640 or so. >> on twitter, the nokia 900 phone is sold out everywhere. that is news that it is sold out.

>> and you will wear the smarty pants maybe later. >> those can be got at jc penny. >>. [ bell ringing ] >> the president's advisory council on financial capability. we're going to speak with the chair of councils in a few moments. and over at the nasdaq, the fresh air fund providing programs for disadvantaged children. upheld by the "new york times" which we have been talking about a lot today. bersteen raises their money today. are we in a food bubble? >> well, we did have the annie's ceo on and you can argue and be skeptic skeptical. i was bullish on this. both of us have had -- we have

had irwin simon on and that stock should be were more, and then steve cohen files a report that he owns a lot of annies. i think there are smart people coming into the food group if it's health. and the call on growth stocks, that's what i have been focussing on on mad money. at a time when the economy is not that robust, it has been a good way to play stocks overtime. >> we're watching here the markets start to open. at this time we're seeing a mixed bag across the board. we saw hesitation about where to go as we sit just ahead of earnings season. the european markets are trading lower today. there is real pressure being felt over in europe. apple by the way, 640, almost 641, so we're getting close to $600 billion there. and the financials are trying to push in the upside here.

>> and that's fbr, talking about you have to stick with the large cap international banks, and morgan stanley has been a tell. you referenced that very quickly. here it is at 18. it does seem to be the one that everyone wants to take a shot at with city group and goldman when people are worried about europe. is the tie correct? it's what people do. >> not a lot of comment about bernanke's speech last night. anybody wanting talk on policy was disappointed. there will be more today and tomorrow. something you're watching or out of the picture? >> i think that we always have to watch because a week ago we heard things were better and then we get the employment numbers and we always have to focus on it. it's always a piece of the puzzle like spaip, italy, china's number last night. these are all pieces of the puzzle, and in the last eight

days we have had a lot of negative news flow that challenges all of your expectations, but the market is going down, and can earnings reverse that, they have so much power they can. >> and jpmorgan is out, and they're raising epa estimates and the price target on google goes to 825 from $800. a shift away from the organic free ads to the paid ads which is good for google. but cost per click was a huge issue. they'll see pressure on cost for clicks. >> we talked about the big yahoo restructure. let's not forget this is a market share situation between google and yahoo. google also trying to find a way to make money off of mobile.

mobile is the future and no one is putting money on it. >> the margins are always more challenged in mobile and everybody is shifting toward it. what does that mean? margins are coming in. >> i worry that is the second better than expected number coming. i love when people say it will be worse than expected, better than expected. lower the expectations, analyst. >> and morgan stanley making a nice surge up more than 1% right now. in the meantime, let's go over to kourtney with more on this morning. >> you mentioned europe, it's the first time they have been trading in four days. they now reacting to the jobs report. things are not good if you're long on europe. spain's ibex is at a three year low. there are worries there about the -- perhaps spain could be an

international -- to the likes of greece, portugal and ireland. it's not just spain, look at italy. they're sitting at a three month low and the yields are also high there on the ten year. melissa, back to you. >> thank you, apple shares, 641 -- we sound like a broken record, but this could be very big, it's a milestone. >> i was offering an analysis a couple weeks ago, divide by ten, is it something to go from 50 to 60? i will point out that usually a stock selling like this would jump 50 or 60 points or 5 or 6 points. this is a stock trying hard to get to a higher level given the multiple expansion we're seeing. and we know that people don't own enough apple verses what the

percentage -- >> and the hedge funds are underinvestments. 4% is owned by the hedge universe. it's a fresh record high on apple, and we're pennies away from them crossing the market cap level. >> interesting to watch the disparity of opinion about apple sort of explode here in the last couple weeks. we're either getting thousand dollar price targets or sells. the consensus is fraying. >> i think there is a lot of people who want to make their career by saying apple is overvalued. not to be too critical, but on our own, we have seen -- look, i remember being back here at different years, and when google came public, i said there was a $200 stock going to $400. she wanted to know how reckless i thought i was going to be.

that was a reckless call. i remember that being seminal. i was slapped and it hurt. i was doing a google analysis and i was saying this could go much higher. and i was told wait a second, don't forget we're not going back -- don't go back to that 1999-2000 period. but apple has earnings. instagram doesn't have earnings. >> at the same time there are people who will make their careers by calling for $1,000. we didn't talk about topica capital until they made the call on apple. if they -- >> he did a great analysis that this could be jdsu all over. it once stood for just don't

sell us, and then it dropped and went to just don't sue us. are we looking at jdsu 2. best buy today has announced the resignation of chief executive officer and director brian dunn. there were no disagreements between mr. dunn and the company on any matter relating to operations, financial policies or procedures, a mutual agreement it was time for new leadership. >> it's not in the fall of him, it's in the fall of the stars. >> ceo will lead the company while a search is still under way. richard schultz will continue to be chairman, and dunn says i have enjoyed every year at the company. >> dunn is a really nice man. you know too. he is a gent. he talked about alcoa being a

bad industry. >> all due respect to him, this is part of the reason this is a bad industry and this particular company has not been doing well. it has failed to do the right things to prevent from being obsolete at this point. some people will say he should have downsized their foot spring long ago. they should have recognized a shift to mobile devices years ago. now they're playing catch up. >> but radio shack moved very aggressively, i was at radio shack this weekend, always terrible, and i was looking for a plug. they're like we don't do that, we're mobile now. in the end, amazon has the best selection, and they ship it to me, and i don't pay sales tax, and what an unbelievable break they get. >> this news is a day after they rejected, best buy that is, regretted a mini tender.

they're known for buying shares and best buy recommended investors turn this down. >> and the stocks are up 3.5% on the news -- >> maybe he is on the wall of shame. when executives of destroyed value leave and you see the stock move up, most often because they want to spend more time with their family -- jim if you did that, i won't every say anything bad about you. >> thank you. >> not a terrible cheap executive. >> maybe your taking a permanent vacation. >> herb greenberg with more. >> it is actually, you know, it's interesting. he was one of my worst ceo candidates of the year last year. you know, this is a company that has been sort of -- you can almost say it seems out of control. was he living in denial?

is he unable to do the job they needed to have done? that's what appears to be the case here. he comes from the stores. i remember talking to tyler mathisson, he did a great best buy hour on cnbc, and he thought it was interesting because when he talked with dunn, dunn really seemed to talk about how great it was to be in the stores. so could he separate flims what real -- himself from what had to be done going forward. >> not the fault of the stars, simply bad tax policy verses tax online, and brick and mortar. is there any ceo that could have fought back against that? >> i don't think so. here is an oddity. every time guy to best buy i have a tremendous experience, and they point me right to what i get on amazon cheaper.

>> the aspect of the tax thing is part of it, but he has to deal with that. remember, jim, we have been talking about staples, office depot, all the big box, and now they have to get somebody with strategy, if it exists, to move them forward to the next level. and it's clear will that include a big charge. >> staples is one of the biggest online retailers out there after amazon. >> they still have a significant big box issue. staples will be the best house in the bad neighborhood of the office superstores, but it's challenged and if you go into the stores you'll see they're trying new things to keep people engaged in the stores. >> it's believed that the founder, richard schultz was a big backer of dunn for a long

time. there is an article in the hometown paper that according to their sources, schultz and the directors were criticizing and this was happening in january. so perhaps the writing was on the wall internally that someone would have to go for the missteps. >> let's understand, not nerve is the cross hairs of amazon. things could be a high price point that you don't need to try on. i heard that bed bath and beyond was being amazoned. they -- >> they're at record highs. >> right. >> but dvds, cds, televisions, games. that's been the sore spot, multiple sore spots. >> remember when we had the companies that sold cds. and you go to the record store. sometimes there's a typewriter store once that was near me. there is changes. there is changes.

people get beaten. people get -- this is dynamic capitalism. and this is destruction. this is the tsunami against a best buy. >> so let's talk -- we're talking about best buy and the resignation like this is their obituary. they're up 4%. they're dealing with the problems. they removed the ceo that may have been responsible for keeping the real estate too big for too long. maybe they have a chance if they can right size this business -- >> that is part of the new plan. >> of course, but maybe further focus on stores on mobile devices and not just tvs and commodity products. >> it could be jim donald being removed from starbucks and another schultz coming back, but i need to see a business plan -- herb i'm just proposing.

>> i know, and i don't think -- i think the vaelt that this is not starbucks, this is schultz coming back and he will have to make the stuff decisions and i think they will have to include news for investors going forward that may be kind of hard to digest because you will have to have some with the right sizing. won't you have to have serious changes in the operation that's will effect the -- >> how is that balance sheet? for best buy? >> they're on the brink of junk. >> starbucks was never there. >> right. >> a different schultz coming back to rescue the company. >> thank you, herb. keep a close eye on best buy today. >> let's shift to bonds and dollar and rick, my hero, f-150 changer, santelli back in

chicago. >> thanks, if you look at what's going on obviously in spain you get a glimpse of the market, but look at boon deals today. they're in the mid160s opening to a 20 year chart, there is not a lower yield there, these are historic low here. tens and 30s are making near one month low yields, and things like t-bills many countries have negative bill rates at auctions or after auctions. swiss, you know their bill rates. some of them are now minus 15 basis points. as we continue to see many countries and fixed income marks that represent some time of value. if you like to have your money in cash they're showing you demand. if you look at big skews, the right and obligation to be short, in treasury that skew is getting large. so there is an insurance issue

that's going on as many get out of their shorts or buy treasuries but are not fully convinced rates are going down. back to you, jim. >> okay, breaking news, we have some ahead of the federal housing financing agency. diana has it. >> that's right, eddie marco, the conservative, has just begun speaking here and promsed on his decision if fannie mae and freddie mac could you help. he is not making that decision, but he is continuing to argue very strongly against it starting the speech by saying his job is to preserve and conserve the assets of fannie mae and freddie mac. he goes over his equation where he says the principal write down would cost the taxpayers money and fannie mae and freddie mac more. now the treasury said it will triple payments to lenders

including fannie mae and freddie mac and there is a conclusion. it will be plus 1.7 billion but a cost of $3.8 billion. his big point here is that he is very concerned that doing this write down will cause people to strategically fall. that cost of those extra people, and he says very few are needed to do that, will offset any savings. he again goes over and over how fannie mae and freddie mac have been helping borrower ins other ways. he also says that any principal write down program will help less than a million borrowers and will do nothing for the 11 million borrowers who are under water on their mortgages but continuing to pay. >> thanks so much.

time now for squawk on the tweet. facebook is buying instagram for $1 billion. instagram does not generate any revenue. so we're asking you what does zuckerberg know about instagram that the rest of the world does not. >> zuckerberg knows that you're enslaving your fastest growing competitor. >> it's a way to data mine photos by using face recognition technology. and jim tweets that it cost a lot of money to get back compromising pictures of yourself. >> we had him on the show a few months ago. he said the rule in social is to get big fast. like steroids and weight lifting. >> this is the talk i heard on

thestreet.com. how about revenues and earnings. is it greater fool? it is, but it lasts a little longer than people realize. >> running out of fools, but there's a few more left. >> but a fool is born every minute. >> that's right, it's a recycling pool. the trading day is young, we'll have more "squawk on the street" ahead. >> coming up don't let the market madness get you down, california mer is here to help. six stocks in 06 seconds when we return. the most spectacular experiences are happening here.

imax now showing on the big board.

time for six in 60. first off, dell upgraded. >> they made a lot of acquisitions. they cover for weak nns pcs, i do. >> coal, coal, coal. you shift it, can't make money

like you used to. >> crown castle? >> i like sba, i think it's better, the tower business for people meeting apple demand. it's a juggernaut, retailers love it. stoke had a big run, big moves are over the summer -- >> the hardware is losing money? >> we can't get to china which is right beneath our feet. >> are you on death watch? >> i'm on nokia watch. every level people said you have to buy it. okay. we have an interesting article in the wall street journal talking about how the gulf of mexico is where people have gone back to the shelf. this guy bought all of these

exxon properties. this is where the action is, oil. oil is going down -- i wish it were going down. >> you're going to try to make some sense of best buy i would imagine. >> yes, jimkramer on twitter. >> we'll talk apple here quickly, are we making too much of this? >> a lot of people saying we are. a lot of people saying we are. a lot of people own the stock. this is one where people should recognize, those that don't own the stock, that it's still not expensive. i want to distinguish facebook buying instagram to apple. greater fool if you have no revenues. not a fool if you buy a company with huge earnings. >> how important is the market cap? it's only been done once before? >> we struggle with how to value it. do we give it a six multiple? is that what people want us to do. if we give it a six multiple we

have a stock that worth more than -- we really do struggle. >> coverage over the weekend about time cook's salary, $300 million over a number of years, worth it or not? we don't know. >> how many people have overpaid themselves and created no value whatsoever? here is a guy, 12 times earnings, it's just remarkable. he has created great wealth. he is taking stock. there is a protest outside, the 1% verses the 99. i want to say that the 1% that create no wealth but shuffle papers should be in the cross hairs. >> speaking of the 1%, the president said in florida will push the buffet rule. biden will talk about it in new hampshire, is it -- >> i would love to have 30%, i pay 48%. i think it's great because if we can get the private equity guys

to pay off of capital gains but ordinary income, like everybody is watching, i think it's right. i think it's fair. i think it's fair. yes, but you're right. romney pays, by the way, my assistant -- doesn't -- >> in terms of paying down the deficit, it's a small piece, but it's more about fairness like the white house would say. >> i think fairness matters, and lincoln believed in progressive taxation. he was very smart. not just because he is on the $5 billion, bill, he is a great guy. >> when we come back, we'll talk about best buy and apple when we come back. the sweet spot that powers sound decisions. duff & phelps financial advisory and investment banking services. but proven technologies allow natural gas producers

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...and 1,000 shades of grey duff & phelps finds the sweet spot that powers sound decisions. duff & phelps financial advisory and investment banking services. welcome back to "squawk on the street." february home sale inventories are up. they increased .9%. if you look at the markets, the big story today is a version of

interest rates, and that of course what's going on in europe. if you look at boones, those interest rates are moving down in the face of peripheral. interest rates in spain going in the opposite direction. >> thank you rick santelli. now, at 64369, apple has a market cap of $600 billion, the second company ever to do it after microsoft. people will make fun of us for paying so much attention to it, but it's a milestone -- >> it is a fresh record on apple, 64390. >> a lot of people watching at home, this has worked come hell or high water, this has been a phenomenal trade for many people. >> it's managed to evade more

negative analyst calls in recent days, and yesterday with one -- btig managed to buck that trend. so a key moment in history not just of apple but of publicly traded companies around the country. i want to go to mary thompson. >> hey there, the fed's point man on new baing reglation, and in a speech today he is saying it's higher capital rates and stability. they need to have two tools, the fed stress test and the bank's capital plans they had to submit. he said speaking about the stress test it showed that the u.s. banks tested made significant progress on their capital plan but he noted there is room for improvement at all 19 firm wst some requiring significant work. they will remain a supervisory focus of the fed. he also said the fed is mindful of some of the criticism it

received about the stress test. the banksfelt it was too severe, and a number of the banks didn't feel that the fed was communicating enough with them during the stress test. he said improvement will be made there. he wanted to point out one change to the stress test for next year. you might recall the fed's test happened late in the first quarter. he said this next year it will happen at the beginning of the second quarter. that's the news from his speech today. back to you. >> thank you, our road map for the next hour, the markets inching upward. just ahead to the kick off earning season, will weak profit growth pressure equities, we'll talk to bank of america for her take. >> and we're breaking down the best and worst sectors amidthe earnings parade. >> and paul ryan heating up the air waves this morning on his controversial budget plan. >> and turning to retail,

american apparels turn around is in progress. >> best buy making headlines this morning after announcing brian dunn will resign as ceo and director of the board. mike mccann has been named as interim ceo. he will lead the company on a search for permanent replacement. also an announcement they're going to close 50 big box stores in an attempt to save $800 million, and there will be 400 job losses through that. there will also be the opening of 100 more mobile stores. so they're attempts to restructure the company, will it be enough after investors have lost so much on that. tyler mathisson did a documentary on best buy and joins us now. you must know these characters

quite well. >> i spent time with brian dunn, but i do not know his replacement who was a cfo at united health and ran optum bank that was an fsa kind of program. but he has a finance program. by contrast, mr. dunn was a best buy lifer. a very nice fellow. there you see him. who basically when he walked into the store, every employee knew him, he had that kind of presence. he was a store guy. when i asked him back when we were preparing the documentary what was his favorite job in his 28 years as a lifer at best buy, he said it was managing one of the stores. not being the ceo, not the guy in the corner office, he was a store guy he really loved it. that was his strength, and i think ultimately a lot of analyst would say that was probably his problem too. the problem that best buy faces

today is with the stores themselves. there are too many of them, they are probably too big. they have a real estate problem, and a declining buzz factor. he was a store guy through and through. >> i watched your documentary twice, tyler, and there was a belief that as a retailer you could turn around the situation, if you were a good enough retailer, all things were possible as far as he was concerned. and when you're in a structural situation that may not be true. >> it's very hard. i remember when we were doing the research i spoke with jim californ kramer, and he said when you have declining same store sales andlessening buzz, and people don't feel that the store is relevant to them in the way it used to be, they can get away from you very quickly and the slide can move very fast. take a look at gap that was once the run away star in clothing

retailing in the united states. and while it's had a little bit of a turn around lately, the truth is over the past decade, it has not had good times. reebok faces similar things. big box and other retailers are facing lots of challenges in an only connected world. >> tyler, thank you for that. let's talk more about best buy, he has a perform rating on best buy and joins us now on the phone. great to speak with you. last month the budget cost cutting closures, stores, you said that cost cutting alone will not fix best buy's issues at this point with the management change, can you see a path? >> i think the announcement today is a negative for best buy. as you said, they came out just

recently with a rather significant turn around thaefrt included cost cuts, store closures, and we learned today that the company's ceo is stepping down. so they're in a difficult position given lack of production. attempting to do a significant turn around, and now their leadership is in flux, i view this as a negative. >> if they continue to close stores and reduce the footpri s footprints, can they beef up their internet business? i thought for a long time that the alignment between the internet business and the bricks and mortar business was bad, and on the internet business they did not cop pete well. >> look, i would keep in mind, i have followed best buy for a number of years now, keep in mind, best buy is the largest

consumer electronics retail ner the united states. we have seen a lot of other similar companies go by the wayside. they have remained standing. it is the largest retailer in the united states, that gives them a lot of flexibility. i think for the turn around here, they are going to continue to alter their business model. in my view the primary competition is online and that's more difficult to deal with than dealing with another store related company. and we really haven't seen a significant product in a consumer electronic base in some time. i think that will remain the case for awhile. >> it makes you wonder if there was a ground breaking product that everybody had to have, it's not necessarily clear that would benefit best buy any more than it would an online retailer. >> i do not disagree with that. companies like amazon and others

are getting better at selling electronics online. i think that's important because the u.s. consumer is increasingly accustomed to buying consumer electronics online. >> there is a bigger point there, as a foreigner coming to this country, it's astounding how the value proposition is the be all and end all. it's alien to a european. we were talking about a profit list prosperity, and people were confused why the chairman might be saying that and he made the con pair son with amazon and e bay. you see it from retail right through what is happening with potentially the airline industry, for example. >> i follow a number of retailers, and there were a number that do a great job in this new world. i think best buy is in a difficult position. not just because of the issues,

but i think it's just the consumer electronics that are challenging and best buy is caught up in that. >> and the difference is that amazon has a luxury of other businesses that can help along with other margins. i'm curious, brian, where do you see best buy in say five years. >> at this point and in the future, best buy is a solidly profitable company with a very strong balance sheet. they generate a lot of cash and buy back a lot of their stocks. so there is absolutely no cash or liquidity concerns here. so that does buy them some time as they attempt to execute their turn around. >> okay, brian, thanks for your

time, we appreciate it. >> within the last few minutes we had history made down here at the new york stock exchange and across the market in criminal. apple breaking the $600 billion market cap milestone. joining us now is an analyst with pacific crest. andy, was this inevitable from your point of view. >> i don't know if anything is inevitable, but it's a funny contrast to the best buy conversation. this company has three products and all three have been monsters in the last few years. and just the success of the products made it inevitable i guess. >> where do we go from here? >> there's room to go higher. i think the return expectations have to be reduced. it is a massive company at this point. penetration in particular markets is higher than what it was a couple years ago. there is still room for some growth, but i don't think it will be anything like we have

seen over the last three months in particular, but the last couple years. >> does large numbers apply to apple when it has such a low valuation? >> yeah, i think it applies to everybody. there is only so many people in the world. there is a much smaller number of people that can actually afford to buy apple's products. so you have to take that into consideration when they're selling as many units as they are. >> so if you sat for the last year, and you doubled your money, and you're nervous about being in the stock, what would your advice be? should they get out, book the profits? accelerate higher, or somebody said to me does it double in value and it's just a question in time? >> it depends on what the alternatives are, if you're comfortable with 10% annual return, i think you want to keep your money in apple. if you feel like you want more

than that, i would absolutely recommend putting it somewhere else. >> andy, thank you for joining us there on the phone. >> market balancing from a string of losses. the dow is down almost 60 points after 2012's momentum push. we have the head of u.s. equity. recently came back to work after delivering a baby boy named waylon. >> thank you, it's great to be back. >> your target is 1400? >> yeah, year end price target. it's interesting because for the better part of the first quarter i was on maternity leave, changing diapers, watching it rip past the 1350 price target, and right now i feel like it's too far too fast. so we're sticking to a more conservative view for the rest

of the year. >> is that a function of money managers having locked in, is it a function of europe? >> i think it's all that you just mentioned. primarily this quarter i think we will see a risk trend. we're tacking about 3% year over year growth. pretty anemic expectations, and i don't think we'll see a real reward from the market. that said, we know the market has decoupled from fundamentals. last year we saw the market come in flat, but earnings grew a little less than 15%. a great year in terms of fundamentals. this year i think we will see anemic earnings, and i don't necessarily see the market keeping up. >> how important is it to redate, as things stand in the moment, with technology and consumer discretion and

financials, do you sit in that? do you rotate out? >> yeah, so the beta sectors did well in the first quarter what do you do now? i think i couple of them, tech and discretionary could continue to run. we're seeing revision data, guidance from those companies are positive at this point. they're trending up and not down. financials i'm a little leery of. >> you can say that at the start of the earnings season? >> that's interesting. yeah, one of the best measures that we found for predicting any given quarter is looking at earnings revision trends and whether management heading into the quarter is more positive or negative. and at this point tech and digressionary look at best. >> haven't they been better than expected? >> yes, revisions on financials have been decent, but the negative here is guidance. and we're seeing management -- the insiders, the guys looking

at their on prospects are down from the numbers they're currently tracking. i think that is a big negative for the sector. i would say in like tech. i think it's a new stable growth sector. given that we have all lived through the tech bubble, i think it could continue momentum. >> the the bears might also not be thrilled with that either, right? >> you're saying that we're not going to lose a lot of ground even if there is an external event? >> yes, so the tail risks exist, and that's why i think a higher risk premium is warranted, but this one i think we're going to be in a big trading range for the rest of the year. this quarter we could see more risk off and then the market firm up towards the end of the year with more clarity around the election or the economic numbers start to turn towards

the end of the year. at this point you're starting to see more surprises on the economic data front, and that could contribute to a correction in the next few months. >> if you need advice on diapers or anything, i'm your man. mine are just a couple years ahead of yours. >> still ahead, lining up after yesterday's official kick off of earnings season. we'll dive in after the break. stay with us. so we have ongoing webinars and interactive learning, plus, in-branch seminars at over 500 locations, where our dedicated support teams help you know more so your money can do more. [ rodger ] at scottrade, seven dollar trades are just the start. our teams have the information you want when you need it. it's another reason more investors are saying... [ all ] i'm with scottrade.

take look at the tremendous gains we have seen. it's down at session lows now by 4%. we just had brian nagle on that said best buy has a lot of cash flow but it could be quite some time before they can manage a turn around here. >> now the situation is just bad. >> you think about it and think about what they need to do, it could be a long road ahead for best buy. >> and we have what we can expect with bob. >> translator: important thing is earnings season has not started and you can hear the wailing and gnashing of teeth out there, the earnings are slowing down, and here is what has everybody panics, earnings are only expected to grow 1%

this quarter. earnings are slowing down because they have been absolutely tremendous for the past three years. look at these numbers after a disastrous 2008, earnings have grown double digits for three years. it's not a surprise they're slowing down, the comps are getting tough now, europe is in a recession, it will be there until the end of the third quarter or beyond that. the stocks have lied earnings expectations keep dropping, it's not a surprise, folks. take a look. valuations were still relatively low going into the year. remember all of those worries about europe in december. look at this in the dax. it wasn't until the end of the year that they started giving out 1% loans to any bank in europe that wanted it. that's when things turned around. that's when we started to see modest multiple expansion. that's the keyword. multiple expansion on hopes that

europe will get it's act together in the second half of 2012. here is something more worrisome. all of the earnings growth for this year is in the 4th quarter. put up this full screen. the street is expecting a 16% increase in earnings. why is that? in the fourth quarter, europe and asia are expected to come back with better growth. that's the problem. that recovery is far from obvious and that's getting some in the analyst community nervous. here is a final stat for those worried about the rally falling apart. 25 times since world war ii, we've got what we got now. the s&p has been up, all 25 times the martin has been up for the full year an average of that 24% increase, and only two of those times did we have sub 10% events. remember we're up 11% on the s&p so far this year. >> thank you, bob, let's

continue our earnings conversation and talk about which sectors dot best as well as the worst. let's talk to the senior manager. alcoa expected to be one of the worst this season. >> yes, they're expecting to be down about 14% for the quarter. this is in comparison to the first quarter of 2011 when they were up almost 56%, so you can see the difficult comparisons there. four out of five industries in that sector are expected to be down. metals and mining are expecting to be a drag. that industry is expected to be down about 30%. so as we see alcoa is only expected to come in at negative 3 cents. so it's really going to start off that industry on the downside. >> our prior guests have been talking about guidance from management guidance from companies so far. i'm wondering what you're seeing

for earnings expectations for the various sectors and whether that has changed how you rank them in terms of what you're expecting for performance. >> we saw weak guidance in the 4th quarter referring to the first quarter. . companies unwilling to commit to a specific earnings per share number. we saw 112 companies provide guidance. that gives us a negative to positive ratio of about 1.9 which is the historic average. for this quarter, going into the second quarter, we're seeing about nine companies providing negative guidance for the second quarter. >> but to be clear, this is not necessarily bad use for the stock market. what you're describing is where expectations are. it could be that they do better than expectations or that perhaps the analyst have been more pessimistic and we rally from here, that's the bigger issue, isn't it? >> sure, and we always see going up to an earnings season, analyst are pessimistic.

their estimates come down about 3% right before an earnings season. companies beat to the upside. so of the 27 companies that are reported, 22 have beat. so very small sample size at this point, but an 81% beat rate would be a record in that range. >> on the upside, you mention materials, industrials and it are leading. >> sure, they're leading along with the consumer staples, those are the only three sectors expected to be up. seven of the ten are expected to be down. so industrials, ten of the 12 are expected to be positive. the two negatives are the airlines and built in product industries. and then with it, we're looking at about a 5% growth rate expected there driven by computers and peripherals. a lot of that coming from apple. >> kristine, always good to see you. >> thank you. >> looking ahead to earnings season, how will emerging

markets impact technology companies bottom line. emerging markets will spend more than one trillion this year accounting for a third of tech spending globally. which stocks could see a boost? tim seymour is a partner in emer emergemoney.com. we buy big american tech because it's making money in emerging markets. >> it's a story you have to continue to follow because with the cautionary head winds that we will continue to hear on the public side of the infrastructure build out will be weak. emerging markets are getting a double pronged attack here. from a big picture concept, this is why we want to talk about these things. you're getting the consumer adoption phase where you have leap frogging technology.

their using wireless technology. latin america, 48% of their it is going into the professional and business sector. that's not only hardware and infrastructure, but it's also software. so when i look at the developed world and the story that people want to play for big names in europe that are exposed to this, my favorite is sap, and they are the leading player for erp and logistics software and dig industrial names to retailers and port operators that are a big part of what everybody knows is going on. >> tim, isn't it a danger that you buy into these stocks when they're falling. the gartner growth figure is going down. >> i think you have to watch where the trend is going overall in technology.

people will talk about head winds that are coming from global gdp pull back. but pmi and emerging market are emerging. so you have to find guys with the most upside to their model. cysco has growth and i like their ability to compete. if you want to play the emerging names directly, guys exposed to the consumer, i think the easiest way to get that technology exposure is through the cellar names. that's tsu, in russia that's mobile tell systems, in china it's china mobile. in all three cases, they're exposed to the consumer moving into the wireless broad band data and cellar surf and you get a big dividend yield. >> you can catch more of his trades on fast money and

tuesdays here on "squawk on the street." >> coming up we will sit down with dov charney. we'll talk lawsuit worries and more in just a few moments. >> look who is talking on cnbc, big names and big surprises. catch a rare and exclusive interview with dov charney, and the first live interview with masters champion and american golf hero bubba watson. don't forget it's trump tuesday, and paul ryan is talking jobs and the economy. cnbc, capitalize on it. sometimes investing opportunities are hard to spot. you have to dig a little. fidelity's etf market tracker shows you the big picture on how different asset classes are performing, and it lets you go in for a closer look at areas within a class or sector that may be bucking a larger trend. i'm stephen hett of fidelity investments.

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♪ one hour to trading here. 7:33 on the west coast. best buy hitting a 52 week low at brian dunn resigns. apple crossing $600 billion in cap trade sales. >> there is one sector that is positive so far today, it's the tech sector because of what is happening with apple, the rest are down. let's look at the headline

figures so far. some comments earlier that we might have got a skewed version of futures for where we might trade later on, because a lot of europeans were switching out when they couldn't trade yesterday. it's the bottom of the market, industrials, utilities, and lower. let's look so far today, two to one decline to advance, and at the nasdaq, you have a slight upward bias in tech i'm afraid two to one. >> one hour into trading, let's go to chicago and find out what traders are watching. good morning. >> thanks. >> i'm told you're watching euro bonds. that could mean spanish sovereign debt or german. >> we're watching the german, it seems like investors are putting

on those safety classes and really becoming quite defensive ahead of earning season that you guys have been talking about, and ahead of the peripheral risks that seem to be reemerging once again. >> in the meantime you're watching some small caps in the russells that have been getting some attention. >> yeah, it's interesting, small caps have been underperforming the large caps for the last three weeks and three months. that continues to show signs of weakness trailing off in the rally at the end there in february and march, and losing ground significantly over the course of the last three weeks. that is a risk off trade in u.s. equities. >> just like the inverse when things are going better. and commodities, you're watching gold down about $5, but crude can't hop above that $1023 price level. >> still just a very much a premium in there, and about ready to launch what could be an

intercontinental missile. heightened tensions in syria and concern about energy supplies affecting that part of the commodity market. our friends at the lynn group are looking at some of the food in the back months. probably favoring soy beans out of that. >> the nation's deficit sure to be a big issue in the race of the white house. port-au-prince ryan's budget of course passed the house and is already sparking plenty of controversy with president obama calling ryan a social darwinist. this is what ryan had to say on "squawk box" this morning. >> let's do it in a gradual way so people can adjust accordingly. prevent people in and near retirement from having da ma in

their lives. >> this is jim stewart, thank you for joining us, two out of the last three sundays you have been very complimentary about paul ryan. but you had donald trump saying that the fact that he released this is catastrophic for the gop, and obama can't wait for the opportunity this is giving the democrats. >> ryan is such a lightning rod, i just decided i would look into this guy. i read his budget proposal and then i talked to him, and when i read the budget, you look at the language in there, it could be written by democrats. he is talking about tax reform and securing the safety net. he said it again in morning on your network. when i talked to him, he cops across as mr. reasonable. and i think people are responding to him because he's the one politician that had the courage to put his neck out

there and say the obvious, which is we have to have a long-term program to control the deficit, and we have to reform this outrageous tax code. >> critic wills argue as they have done today again that he lacks compassion, that two thirds of the savings will come from the poor through food stamps, and for him to make it work, you have to make the leap and assume the pro-growth tax cutting policies will help the poor, and that's a very big leap for a lot of the population to make. >> i think he has laid the ground work. the tax reform elements says let's lower the rates, but he also says you have to close the loopholes. you have to come up to to say revenue neutral. you have to raise one trillion of additional money. and so there is number one. secondly, there is nothing written in stone that it has to

be revenue neutral. you can still achieve the ryan goal of lowering rates, maybe not to the 25% top rate but maybe to 27 or 28, and you can raise some tax revenue, and that is the beginning of a compromise. the republicans get lower rates and democrats get higher tax revenues. >> and it dove tails with the buffet rule, why are they so -- why are higher rates for the wealthy for the right, and is that a legitimate position to be in? >> i don't think it is legitimate. we have a regressive tax code where the ultra rich like mitt romney pay way lower rates than people earning in the 100 to 500 range. and earned income is taxed so much more heavily than unearned income. you can approach these issues, have tax reform, lower the

rates, let's just traech the rich the same as we treat the middle class. and then we will raise a lot of revenue. >> i want to ask you about apple in a moment, but just to wrap up this conversation, what is the smartest thing for the gop to do with the man himself. obama is campaigning against ryan as a result of the budget personally. do they put him on the ticket as vice president, or does the gop leave him to sort it out in november. and a suggestion in one of the columns that you wrote that ultimately it could be the end of his leadership career because of the gop and the compromises he would have to make. >> that's what jim cooper told me, he is a great guy. he said the more visible you become, the less you can put your neck out there and take big stands. i don't know what republicans should do, but i know that the democrats should be careful about how much they criticize ryan. he is looking like a hero, mr. willing to put himself out there and touch these difficult issue website and he is being talked

of as a vice presidential candidate possibly this year. so far these are backfired as far as i can tell. >> what about apple then, jim, we crossed $600 bill in market capitalization in the last 35 minutes or so. a moment in time? >> it's amazing. it's up 20% since i warned that at $2500 billion, the law of large numbers will kick in. that means it will passes the trillion market cap and then the three and the five, and it will be bigger than many gdp's of large countries. so at some point this growth has to stop, and it certainly has momentum on their side. >> i'm sure they'll write that you got the timing right. >> when we come back, american appeal is struggling. we'll go straight to the source and talk to dov charney in an

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♪ ♪ pick me up from the bottom we have been talking all morning long, let's go to jane wells who just sat down with dov charney. >> one year ago this month, american aapaper -- apparel was recovering. have things changed? in his first interview in years, dov charney says yes.

>> the time to make one armt is about 3 minutes. his business model of paying a living wage to make clothing in the u.s. and a company that controls the process from knitting to marketing, it's still in the red, but he is winning believers. american apparel got an $80 million lifeline, and ron burkel has tried to become a investor. >> i think you're casting it in the wrong light that it's unprofitable. from an accounting perspective, you know, ten, 20 feet up, it's not profitable. i'm talking about cost verses the selling price. we're getting our grove back. our efficiencies are improving. we're mastering the timing.

and now that the financial paradyme is stabilized -- >> what is it, what are you paying? >> the average costs are 14%. >> at what point do you think you will return to profitability? >> on a net, net, net basis? i would ask, but maybe next year. >> they claim a 31% jump in store sales. net sales closing in on $560 million, but shares now were at $15 are now under a buck. charney says this is his baby, the board has not asked him to leave despite several lawsuits and headlines about his behavior. >> i counted nine lawsuits, how many lawsuits?

>> yes, that's a testimony to my success though, the fact that i'm a target for baseless lawsuits -- >> they're all baseless? >> yeah. i'm not going to sit here and go through thousands of pages. there are some -- but the allegations that i acted improperly at any time are fiction. >> do you think you're inappropriate at all? >> no. >> i would say the range of criticism is everything from sexual predator, which you heard, to just maybe weird. >> you know, i mean -- weird, i like weird. >> some of the lawsuits have been dismissed. some settled. later on, why charney thinks making u.s. clothing in the u.s. will be cheaper than making it in china, and why he thinks america needs excentric ceos. >> their ads are not as racy as

they once were, are u they still aiming for the same consumer? >> they have a line of kids clothes, they're trying to broaden, but i think it's still the same target. you walk around that massive seven story building they have here, and they're aiming at that core audience but they're trying to expand it. has the branding changed? has he changed? i will let you be the judge of that. >> weird -- no, that really stood out in the interview. we should note this is an $87 million market cap company, so the stock can be pushed around. right now it's up by about 7%. i'm curious, at this point he said the margins were as high as some of the luxury brands, it seems unfathomable to me selling those can give you the same margins as prada handbags. >> he said they're in the mid-50s.

he claims he has not changed his price points or wages. they did change their shifts, r company is profitable. >> i will use that line. these allegations are testament to my success. >> thank you very much. jane novak, live from l.a. >> some people like weird. facebook announces it will share app instagram. we'll talk about facebook's latest move in just a few. but first, rick santelli, what are you working on in the next hour for "squawk on the street"? >> we're going to decide who are the natural buyers and sellers for a european paper? we're going to talk about european corporate paper and like many corporate issues it's been exploding, and we'll see how that may affect treasury

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i want to quickly recap the news here this morning. a couple big breaking stories. first of all, best buy announcing its ceo will leave. and apple crossing that $600 billion market cap. did see a streak in best buy which makes us think shareholders maybe thought the problem was brian dunn. a gain not quite at this level. 43 is what we needed to be at. >> will we close at the $600 billion cap level? >> they said he was in conflict with the rest of management. the fact that he leaves doesn't necessarily open the way potentially for a different

strategy that would better unlock shareholder capital. >> hard to take that at their word, though. it's a politely worded press release and maybe there were disagreements. it's hard to say. >> they had reported in the past that there were tensions between the chairman of the board and brian dunn and the other directors on the board, so maybe there were tensions behind closed doors. >> tweak time in honor of facebook's big one. the billion-dollar buyout of instagram. we're asking you, what do they know about the rest of the world that others don't? we're back in a minute. they have names like idle time books and smash records

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tomorrow on ""squawk box" " eddie lazire. >> what about gary betman? storm all right, time now for "squawk on the tweet." in its largest acquisition ever, facebook is buying shareholder company instagram. instagram does not generate any revenue. so this morning we are asking you, what does zuckerberg know about instagram that the rest of the world does not? michael tweets, it could be

worth as much as facebook in three years. zero dollars. that a picture is worth a billion words! we've got the fast money to be made in art. yes, there is fast money to be made in art. we have a guy whose specialty is investing in art, asher edelman, who you might know is a corporate activist, but now he's into art. >> do you live for the beginning of earnings season? do you get a kick out of it? >> i do. especially the technology earnings that are all after the bell. it's adrenaline. >> would you feel better in alcoa was want the first one out of the gate? everybody says, you know, it will get a chance to come back. >> google on thursday. >> it would be nice if apple was

the first one out. >> someone just has to decide beforehand. >> anyway, we'll see you tonight at 5:00. if you're just tuning in, here's what you might have missed. >> welcome to our three of squawk on the street. here's what's happening so far. >> the white house putting out this report just at the top of the hour. they're calling this a buffett rule. >> the buffett rule is going to be nothing. it is going to do nothing to mr. buffett's charitable deduction which allows him to pay little taxes. it will affect a few hundred other people. >> paul ryan will go down as -- this will be the single worst move in the republican party for many years. >> yahoo is behind the times, and it's proven like research in motion. once you fall behind in

technology, it's really hard to catch up. >> when you put away the price of those patents and the price facebook is paying for instagram, does it reek of a bubble in any way? >> the question is where are we in the bubble formation? >> opening bell time, a look at the s&p 500. >> today best buy has announced the resignation of its chief executive officer, brian dunn. >> i look at best buy now, a company that's in a very difficult position, and now their senior leadership is in flux. so i view this very many as -- very much as a negative. >> get a check on the markets this tuesday morning. once again, for the fifth session in a row, the dow is

down almost 70 points, the s&p down to almost 7 -- just lost it there -- 1375 and the nasdaq negative as well. best buy down 2% after the announcement that ceo brian dunn is resigning. they will search for a permanent replacement. we will talk with an analyst about what it means for the stock in a few minutes. apple hitting that $600 billion market cap. stock needs to hold above 643.53 to maintain that milestone. let's look at the road map this morning. facebook making its biggest purchase ever. plus, the man calling for a muni comeback. the head of munis joins us live with his pick. and countdown to the european

close. german yields are sliding as fears of a deepening debt crisis resurface. we'll see how it all hits here at home when european markets close in less than half an hour. do discount retailers feel the pressure? we'll start with the big news of the morning. best buy's ceo stepping down. joined by joe. good morning. stocks piked a little bit with this news. what do you think? >> investors have been wanting to see a new ceo and a transition there. now, i think you'll see you still have the same structural problems that you had prior to the announcement. they need a strong ceo to come

in and make some changes. >> i guess that means what they announced in the past few weeks was not radical? >> you have 8 million in cost cutting over the next few years, but they were going to close 50 stores and they were going to open 50 stores. investors don't want to see this company reaching for growth right now. investors want to see this company maximizing the opportunities that they have in front of them and operating in a more efficient manner. >> what opportunity might that be? >> i think if you downsize the box, if you right-size the number of stores, really cutting back. cut a few hundred stores. cut it back to where it's a more manageable level to where it will be all profitable stores that are driving good results that you can manage and put in new things to drive technology sales, better service and better, you know, displays of the product. all those basic kind of re

retailing things to get the customer reengaged. it may hurt the gross margin, but you're going to need to do that to compete with the internet. >> the geek squad, people still use it as a showroom when they go on line. that doesn't appear to be changing any time soon. i'm guessing you still believe the liabilities they carry for now outweigh the opportunities. >> yeah, i'm in that same camp. nothing has really changed yet. i would like to see who they bring in, and there is some flux right now so we need to get the right guy in position, and then see what kind of radical operational change they can make to really drive some underlying stability in the business and make this more of a cash flow machine and a mature company. they have been buying back a lot of stock. the stores are profitable, for the most part. >> who is your dream ceo?

who is your dream hire? >> i heard some people kick around doug scovaner, the outgoing ceo at target. it will be interesting to see. i'm not sure he's really going to be the guy, but that would be a good one. >> we've seen a couple high-profile hires in retail. j.c. penney comes to mind. we'll see if best buy is next in line. appreciate your insight. >> thank you. >> hop over to rick santelli at the santelli exchange. morning, rick. >> good morning. i'll tell you what, carl, everyone i dealt with in edmonton and oklahoma city, great people, entrepreneurs, lobbyists, hobbyists, enthusiasts. the trick is to make every car run on as many different fuels as possible, like that truck, you hit a button, you go gas,

add in some more fuels, give the power of pricing and competition back to the consumer versus the energy companies. let's talk about who the natural buyers are. peter bookvar, he said nobody is buying that expansion in italian debt anymore, and he's right. there are no more national margemarge natur -- marginal buyers. they're buying a new wrath in europe. they're avoiding the banking site going into the capital markets just like u.s. companies have discovered. it's a wonderful thing. i think investors have better metrics to judge the longevity and the stress of how those relationships work, and i think it's very appropriate to also look at what's going on in the u.s. today with the first of three options.

32 billion, why is it important? because post trl, potentially post quantitative easy, although the jury is still out on that. this is going to give us a really good indication of how the investors demand once again at potentially sub 2% levels when boon rates are in the 160s at historic lows, not at historic lows in the u.k. but close. you might think it's illogical, but don't underestimate the intelligence of investors forsaking higher yield. it sounds pretty smart to me. back to you. >> thanks, rick. we know you'll keep us up to date on that supply. our capital senator gary kominski is here to talk about something, whether it's facebook or yahoo. >> we could do technology for two hours today and have some interesting things. just a couple quick thoughts. i'm the last person in the world

to give any opinion on facebook because i don't know what it even does. but this instagram, i don't know what instagram is, but what i do know is i've attended hundreds and hundreds of pitches by venture capitalists over the years in terms of making investments in d.c. funds. i've never met a venture capitalist who said, invest in a deal, put that deal together and we're going to double our money in a week. which is basically what happened. maybe there's a reason, we'll learn more about that in a second. that's something you have to think about. yesterday, we didn't get a chance to talk about this aol. facebook is spending $1 billion for this instagram acquisition. the question here is, what i want to know, all these analysts that follow aol, why did they not understand this investment? >> i think there may be breaking

news on tech, specifically yahoo. john? >> yes, indeed, carl. yahoo memos out this morning from scott thompson. he's saying yahoo is indeed memorializing on three regions. the regions division mainly deals with advertising and sales, then the platforms division deals with infrastructure and some of the technical guts of yahoo. this is a big shift from the way yahoo was organized in the past. some things are more centralized. of course, we saw the product chief, blake irving, leave last week, one of a series of high profile people to leave. this gives yahoo's employees a look at the future and how he plans to drive growth and keep things together despite the proxy fight and all these

questions of asian assets where all their stock is locked up. he said yahoo will reorganize along three divisions. one is the consumer group, one has to do with sales and product, and the last platform, carl. >> john, the explicit mention of mobile, or is that embedded in one of these name something else? >> no explicit mention of mobiles, but you would have to think that's under consumer and platforms, consumer what that actually looks like to the end user and platforms, delivering the guts. >> we know you'll keep us posted. thanks very much, john ford, with the news out of yahoo. >> the third component we mentioned about aol. where were the analysts trying to figure out the embedded value? i want to bring up that 20-year chart of yahoo again. take a look, remind people of what yahoo looked like during the tech bubble.

i think that pinnacle was reached on that chart when they added to the s&p 500. every closet industry in the world had to buy that stock. the question here is, i can remember when yahoo was going to be the dominant player on the internet, and every portfolio manager had a piece of that spot. aol was the best performing stock for the new york stock exchange for two years in a row. so the point of technology is very simple. let us never forget where we are today. like many industries, we don't know what will exist, and what we've had over the last two days is a very good reminder of that as investors. you look at some of these charts, you look at the businesses. all the businesses can stay together for decades, technology not the case. last thing, there was a great memo saying when yahoo hit that price peak in 2000, the chief investment officer wrote a memo. it was anheuser busch versus

alkami. just something to keep in mind. >> we talked about commerce i the other day. >> i'm excited to learn about instagram and why a billion dollars was cheap. >> let's think about that. the instagram ceo was on the street a little while back, and he did talk then about the company's future. >> we have a new office we're expanding to and we intend to grow the company as well. for social media, the goal is to get as large as possible as quickly as possible, because at the end of the day, it really is a winner take all game. >> now known as the man in silicon valley worth about $400 million. shane is a reporter and coffeve facebook for the journal. >> i think you just heard what

kevin said, which is the goal in social media is to be the dominant winner, and that's what facebook wants to be. what you're seeing very clearly in silicon valley now is that facebook was the first to come out with this idea go b getting users data and all these other social networks are popping up, and they're actually doing a good job. they may not have 800 million users, but they're getting users data, and that scares facebook. facebook wants to be the dominant player. personally, what i think is you're going to start seeing facebook, now that they're going to have $10 billion worth of cash to burn, making more of these acquisitions. >> of this size? >> i could see it happening. >> zuckerberg says, i promise, i promise. >> i just have the feeling that -- facebook has the engineers to make the technology themselves. there is no reason they couldn't have built this themselves. why did they have to go buy instagram? it's probably because they saw that innovation and got scared

that these guys were really building something up. >> if they have it, it means google plus doesn't, right? >> you've got google plus as a competitor, you've got path, you've got foursquare, which is growing tremendously. pinterest, it's growing every day. my next guess is they go after pinterest at some point. i just think facebook wants to be dominant. >> you said something that caught my attention, that facebook was scared. why should a company that's going to go public with $100 billion cap valuation be scared? >> you just made the point. >> as you were saying that, i was thinking that. >> is it that they themselves believe that the market is giving them a value -- this is a pinnacle valuation at the time -- that they need to be concerned. you mentioned something to me off camera that the venture capitalist who invested in this company a week ago had a certain

mindset at the time. in fact, some of your reporting alluded to the fact that they've turned down facebook in the past. what has changed in eight days? >> well, it was probably less than eight days, by the way. it was literally probably, over the course of -- we reported this in our story, it was literally over the course of the weekend. >> what happenedover t over the weekend. >> mark zuckerberg made him an offer he couldn't refuse. he promised that instagram would run independent as a separate company. he made a lot of promises he's never made before. i don't know what finally turned kevin's mind, but obviously it was double what he was getting before, and he thought he could still run the company. but i do think just on the fear point, what you see with facebook is that they were the initial innovator in the sense that they figured out a way to get data out of people. and they are going to sell that data. that's their goods, right? and all these other social media companies, they're just figuring out other ways to get data from

people and for that to be their good. mommy don't know how they're going to monetize this good, but that's where they're all trying to be. and i think facebook is lagging in terms of innovation. they don't want to be a yahoo, so they want to stay on top of it and go after the younger competitors. >> what's being said in the valley about the price? not with profits, but with revenue. >> i spoke with some engineers and stuff, and i think people are, you know, ecstatic about price, and just thinking, maybe my company will be next. and facebook is the new big player in town. they've never done this before. so maybe there will be more money to come. >> so it begins. shandi race from the journal. peter hayes, managing director and head of muni bonds group. picked up back in the '80s.

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>> joining us now here on set, peter hayes. peter, las vegas brings up a good question. let's talk about expected returns in the municipal bond area and the type of issues that we're going to see, like las

vegas over the next year. what do they expect the returns to be in muni investments and what do they have to look at? >> you buy these in the first place for income, and when you compound that for the tax kpemp exemption, the income is even more compelling. in 2011, we talk about total return. not that that's unusual for the market, but you have to look at how you maximize your income, and right now i say you buy revenue sectors. the market still hasn't adjusted to loss of insurance. it's difficult for investors to figure out how to different an a-rated hospital from an a-rated airport, for instance. so you have to look at a lot of spread in that sector. >> so i'm not looking at capital appreciation if i'm in a muni in 2011 but i want the return. what can i expect the returns to be if i gave you the money in a portfolio? >> first of all, what is your

interest rate view? rates probably don't go significantly higher for a longer period of time. we think that's still the case. think about income. what kind of income can you get from that particular bond and what kind of interest rate are you willing to take? >> if i want to have a muni portfolio today, don't want to take a tremendous amount of interest rate risk, is it 2%, 3%? is that the risk i should take? >> i think if you're willing to take that risk, you can expect returns of around 4, 4.5%. and the income on that is tax free. >> let's talk about the differences between investing in bonds and bond funds, something i've touched on recently. what is the difference between an investor buying a muni bond fund as opposed to just muni bonds. >> when you buy a muni bond, you really have to understand what the credit risks are with that bond. if do you have a credit rating

with that bond, it will make a bigger portfolio. >> so you've got the diversification, but what about this idea that you don't have any maturity dates, that essentially when you buy a bond fund, the bond fund doesn't mature? >> that's a great question. i think some people do like that idea of buying a latter bond, know what they're getting and when they're going to get it. but if you look back at 2010 and 2011 with that dislocation, bond funds are very negative. you know how you'll get out and liquidity was actually seen during that period. >> liquidity is actually a beautiful thing. >> remember, liquidity is a beautiful thing. >> we want the exit door to be wide open? >> when we come back, the closing bell in europe. only about 6.5 minutes to go. we'll be back. both are used to treat men with low testosterone.

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closing for europe, all the banks are down big. in the meantime, the yield here in the states below 2% for the first time in months.

simon hobbs. >> this dumping of peripheral bonds, i'm talking about spain and italy, and the yield rising up to 6% in spain is a huge issue for the market. let's just take in the headline figures. >> closing now. >> so let's look at the maps of europe, and i want you to look in particular what's happening in italy down at the bottom there, down almost 5%, spain down almost 3%, so the south european colonies again under a huge amount of pressure. it is about the market, it is about the ability of the spanish and italian governments to convince the rest of the world almost standing on their own without the help of the rest of you that they are still a good bet to hold their bonds. let's have a look at what happened in spain today. this is a year-long chart of where we are in yields for the spanish, and you will see how we are spiking substantially here, and we are closing on the european session now at a yield of 6%. okay, it's lower than we had

some time ago before injection of that massive amount of cash, but a 6% yield in spain is clearly not good. let's have a look at the situation in italy. the contagion is moving to merging markets and peripheral debt here in europe. 5.6% on italy. in general, there is a fight to quality. so the boons and the treasuries are being bought, therefore, they're going down. if you look at the difference in the extra they're talking about spanish debt between german debt. the spanish spread, as you can see, continues to write the way through. we are almost back to where we were before that massive injection of capital. let's check on the stock market themselves. we'll have a look at where we are on the charts for the major markets moving in. we were speaking at the

beginning of the session about catch-up. this is what has become most important. this is why wall street is down because of that rapid selling toward the end of the session. and it's around the banks, which is not a good sign. have a look at some of those big european banks which are still exposed to spanish debt or to each other. look at societte generale, commerzbank ag, they're down. >> you bring up some spectacular charts. you are seeing a complete repeat of these concerns, and there is a little bit of seasonality here, but we pointed out last week what was happening with the german bond and the u.s. treasury. this is how things began last spring in the sense that people

concerned about what was happening in europe, again -- again -- and then having this race to safety around the world. in fact, i will tell you, i respect the tacticals, you know that. you look at the charts simon just presented, you cannot ignore the fact that the ltro is not going to be there forever is not having a huge impact. >> the big question was always the degree to which the money that went into the banks, the cash that went in, would end up permanently at the ten-year -- the routes around the world for the country. there were a lot of people coming out a month or so ago suggesting the market had overestimated the degree to which that would be permanent. yes, they'll buy at the short end of the market. that's perfectly normal. but why would you buy the spanish ten-year now? why would you buy it? >> clearly, fewer people want to. >> that's the point.

>> people always say, don't fight the fed, don't fight the fed. you know what? i always like to say, bond investors so much smarter than that, compelling here today that the bond market, which has been saying for several weeks now, we are ignoring europe but it's the wrong thing to do. bond investors looking smart again. >> further down the line, there is indication that there will be int interjection. they're talking about the banks having to have further capitalization. this is apparently what sparked it last thursday. he said the blowing out of the bond spreads was all to do with the governments and the need for austerity rather than saying, unconditional unconditionally, we stand behind them. which you might not expect them to do but it would have helped. >> simon, tough day in europe. want to get to courtney reagan where at least the dow is close to its sector lows.

>> it's interesting, we often take our cues from europe, but i think some of what we saw today, not only are those debt worries still looming, but they're also playing catch-up from the four days they had off at the easter holiday, so some of that reaction is from our u.s. jobs data we saw today. i know simon went through some notable moves there, but a three-year low for spain and italy is at a three-month low. but greece moving in the opposite direction of some of those stubborn horses. many of their banks posting some very significant moves. they had a six-month t-bill auction, selling those t-bills at lower rates. many of them do sell for 1 to 2 euros a share.

energy is now negative year to date. we have some notable movers in that space. baker hughes is actually lower. we're touching lows not seen since 20 september of 2010. >> shaping up to be very interesting. thanks, courtney. let's head over to rick in chicago. hey, rick. >> thank you, carl. we have a father-daughter team that probably has more agricultural experience than any duo i know, jerry gulkey, daughter ashley gulkey. we had a report this morning. what we saw was the three major crops, wheat, beans and corn. >> they dropped the wheat carryout in favor of wheat feedings and that went to this year's crop. i think the government is trying to tell us we can't end the year much less than that, otherwise

we're going to have pipeline supplies that will be short. they implied we're going to bring some new crop corn into the feeding mix early, and we're going to take some feeder cattle and put them on the good wheat we had this year that we didn't have last year. >> if we open the report out to worldwide, what do we see, ashley? >> we saw things drop in soybean, corn and wheat across the board. we've seen the soybean crops go down a little bit each week. we think the worst is over. we think that it will not continue to get any lower through the south american issue right now. >> how different is it, historically, to see wheat one of the commodities moving more towards feeding animals versus corn? is this unusual? do you think this will continue? >> if you have too much, you have to feed it. you can only eat so many slices of bread a day unless we get a crop problem or an importer like china and russia and so forth.

but when you have too much of it, you have to feed it to get rid of it. then it becomes a competitor with corn. usually when you decide to feed wheat, you want to do it for about three months. we've got a good wheat crop coming this year that allows the cattle feeders to do that. >> ashley, if i'm looking, there's dry bean season coming up soon, in about another month, but there's also barbecue season. so for those viewers who want to be throwing the steaks on the grill, what impact do you think that will have on prices? >> i'm not sure what that will do to prices. >> i think we're going to pull some of these feeder cattle out of the feeding mix and try to put on some pounds on grass -- >> it will probably be lower? >> hopefully they'll come back in later in the summer. i think cattle and feed are going to go down substantially because they'll hold them back. that's kind of a function in the market to feed them less.

>> the weather has been picture perfect in much of the midwest, much of the country. very mild winter. we're supposed to get higher temperatures and we'll be planting boatloads of so i beans and corn. do you think the weather whether impact it at all? >> it doesn't affect it early on than it does later. on the eastern plains, it was down to 18 degrees last night. where it would be a problem is in the areas further south. >> so the weather is going to be pretty good and good for agriculture in the near future without any surprises? >> yeah, and they're talking about el nino stopping and then -- >> we're out of time. we're going to always come back for one of these usda reports. back to you. >> thank you so much, rick santelli. before we move on, take a look at s&p today. we're close to that 70, gary,

which people have talked about as a long-term pivot point. it's at 52, the day's average of the s&p, and people will be watching to see if we fall sharply below that. >> and remember, the s&p has outperformance with the waiting. >> we have to point out the fact that apple is somewhat disguising some of the other -- because it's such an informed part of the component of the indices, it is hiding some of the other relative underperformance. >> we'll keep that in mind as we watch the dow still down almost 100 points. meanwhile, sex trafficking and goldman sachs don't seem to belong in the same sentence. kristof recently broke the news as his quality fund was exiting a 60% stake in the media that runs a forum called backpage.com. kristof joins us now with more on the story from the newsroom. nick, always good to see you.

good morning. >> good to see you. >> how would you rate the alacrity? >> i talked to them on tuesday midday, and they said they were stuck with this private company, not much they could do. by friday they called me and told me goldman had signed a deal to unload those shares. i think they still sold it to management for almost nothing because of their public relations hit of owning a stake in america 's sex trafficking wb site. >> your company is uncomfortable with its connection with the company. do you think they were willing to sit on it until you came along. >> i assume that's what happened. look, this is a tiny investment

in a huge company. i'm sure senior managers were not aware of all the particulars. at the end of the year, goldman had a managing director on the board of the leading sex trafficking web site in america, one that has gotten a lot of press, it's very controversial, and as far as i can tell, neither it nor other private equity investors ever made any attempt to influence the way the company was operating. maybe he wouldn't have listened to them, but it's not apparent that he even tried. >> the pushback on you appears to be threefold. one, they tried to get out of this for a long time. two, that you named them more specifically than you named some other investors. and 3, some elements of the times also benefit from advertising that may look something like this. >> yeah. you know, goldman has been not hugely transparent about exactly their role in the company, about why they invested in it. all that's really clear is they

invested about $30 billion and essentially lost all of it, and in the process not only didn't do well for their investors, but also for four years, they add on this board and had no control whatsoever to get the company to behave more responsibly. >> we all know what a pernicious and horrible crime sex trafficking is. is this sale a step forward? >> i wish the company, frankly, were using its state to try to advocate for change within the company rather than just selling back to management. and, likewise, other private equity investors seem to be trying to sell back to management, which means there really isn't going to be that voice for change. they seem, understandably, to be more concerned about their image. i would have loved to see them

chair to the state. >> nick, it's certainly drawn a lot of attention and that's probably for the better. we appreciate your time, as always. >> thank you very much. straight ahead, a lot more where the markets lie with the dow down almost triple digits. that's coming up next. but first, the winning and losing stocks from the pretty miserable trading day, and it's just now ending in europe. auto-bliss. with rent2buy from hertz car sales, you skip the lots... and pushy sales people... it's a fast, easy way to buy a used car. three days to try. zero pressure to buy. it's just another way you'll be traveling at the speed of hertz.

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coming up in a few with the half time report. with the market selling off yet again, do you continue to stick with the winners? best buy, do you bet on companies making a big change at the top? we have some names to buy, and of course, sell. lots of trading always at the top of the hour. back to carl at the exchange. >> the market is obviously back on their way down. the first word from nyc with mark cashen, straight ahead. [ male announcer ] you are a business pro.

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the dow is now down almost 105 points. let's bring in our cashen director, floor operations. if you looked at equivalent points on the dow, italy closed

down how many? >> close to 700 points. about 680. >> in italy. >> in italy. >> and spain is back to their lows. >> spain was down the equivalent of about 400-some-odd points. it's back to the low of march of 2009, which is a pretty scary place to be. >> what's leading the concern? is it as simple as yields, or is there something more beyond that? >> i do think the yields have begun to tip it off to go with one of gary's favorite themes. the bond market is deemed to be smarter than the stock market, and once they begin to see those things, you just can't deny it. and this thing has become very disruptive all of a sudden. >> just on a positive note, when simon was doing that piece earlier, i took a quick look at where the junk market was, and again, going back to what art just mentioned, the junk market, which may be more tied to interest rates, is not showing the type of correction or mini correction we're seeing right now in the equities.

we were just having this conversation, and maybe sort of tongue in cheek yesterday, i mentioned the "60 minutes" piece that was on air sunday night talking about the euro crisis. if you watched that piece, you sort of didn't know anything. if you hadn't been watching cnbc for the last couple years, you were like, boy, this is bad. maybe it's having the same sort of impact that we did not anticipate around the world that we had seen. and i bring up the meredith whitney thing from a year ago, two weeks later people were like, wow. did it really happen? did it have the kind of impact it did? and it did. what do you think? >> it brings in some sort of audience. the people watching cnbc follow it every day, they're well informed about it all, but, you know, you've got a group of people who don't pay that much attention to -- certainly on a daily basis -- the stock and bond markets, and they haven't realized what appeared to be a severity. >> the yields have gone up in

europe but they have not gone up for any specific fundamental reason that we have seen. the austerity is the same austerity it was two weeks ago. the slow growth economies or no growth economies are all what they were two weeks ago, and germany had to basically breed everything, anyhow, two weeks ago. >> what you're seeing over the last week and a half are how much these banks are exposed all over again. some of them took the lpr money and said, this means everything is fine. they went out and bought their own sovereign debt and they have more winnings that they had before. >> by wait, tthe way, the sprea took the ltro is at a high when they were showing those concerns. >> above that 1370 level, what are technicians saying at this moment? >> we broke a trend line. i think you guys had carter worth on yesterday that was showing the trend line that goes

back through the december lows and the early march lows. we've broken that. that means we'll have some kind of correction, and it may be an intermediate type correction. that would mean it can last weeks and not days. >> tomorrow's notes you're going to be put out, are you going to think about the fact that seasonally it's sort of deja vu all over again? >> it's not just the stock market. go back and look at things like payroll numbers. people were very encouraged about payrolls last year and they seemed to hit a wall. it may be things like seasonal adjustment, but your payroll may all be correct. >> thank you, art. appreciate you coming on. meanwhile, keep those tweets coming. we do still have this billion-dollar deal done by facebook. what does mark zuckerberg know

the rest of the world does not? we'll get some of your answers after this break. ♪ ♪ here we are, me and you ♪ on the road ♪ and we know that it goes on and on ♪ [ female announcer ] you're the boss of your life. in charge of making memories and keeping promises. ask your financial professional how lincoln financial can help you take charge of your future. ♪ ♪ oh, oh, all the way

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apple was ea nasdaq is now in the red. it was in the green. nasdaq losing its key support. despite its 30 million users, instagram does not generate any revenue, so we're asking you, what does mark zuckerberg know about instagram that others do not? matt writes, the viral power of photo sharing is extremely important. and facebook wants to take on getty images. can you imagine the images of 30 million users? not a bad point. rick santelli joins me. rick, reflexes on where you think the market stands at this moment. >> i think this is a huge day for the fixed income traders and

even all traders. the acknowledgment that as much as rates can pop up quickly because conventional wisdom is that these historic low rates can't last forever, global growth argues with that. the investors' sentiment disagrees with that, and we continue to see whether it's negative t-bill rates of many countries around the globe or, you know, historic low yields in boons, or our first close potentially under 2% in ten years. you have natural gas competing, whether they could stay above or below, too. i think this dynamic is going to continue, and i think it's not going to make a lot of volatility or maybe even a lot of money on treasuries, but the real question is i just don't think you're going to get rich selling treasuries, and i think that's really the debate to have. >> we have to head into earning season, gary. >> let me put my manager hat on and go back to