i'm maria bartiromo, earning season in full swing, how is the consumer doing? and the housing market, big numbers this week. what does it mean to your money? the next war may be fought on this precious commodity, scarce and vital to the world commodity and it's not oil. when it comes to feeding the world, buying local may not be the best idea. wall street journal begins right now. >> this is america's number one financial news program. now, maria bartiromo. >> i'll be back with the rest program in just a minute. first here is a look at the

headlines this week. >> here's what's making news as we head into a new week on wall street. after a strong start to 2012, are we diping into a spring slump? a disappointing report on the jobless claims showing the number of new filers for unemployment benefits is up 6% in the last three weeks. and weaker sales of existing homes in march underscored investor worry. the markets had a bumpy week. the dow had triple digit intersession swings and the corporate earnings picture is rosier with more than 80% of companies beating expectations, they include banks citigroup, goldman sachs and b of a and morgan stanley and coca-cola, johnson & johnson and microsoft and ge. apple had a rough wide. shares dropped 4% on monday and rose on tuesday but stumbled 3% on thursday on concerns about consumer demand ahead of next

week's earnings release, the tech giant hit its most recent all time high on april 10th. ford is betting 5 billion on china and biggest industrial expansion, they are building the fifth plant there and expanding the line of dealerships throughout asia. ford will build 1.2 million passenger cars in china by the year 2015. warren buffett, the third wealthiest man said he has stage one prostate cancer. he has not made public -- with radiation beginning in july, his prognosis is excellent. >> after the mixed week, one economist is feeling optimistic. joining me now is mark zandi. it's great to see you. >> good to be with you. >> we're this the thick of earnings season, if you will, and some of the biggest companies are painting a picture that's pretty much okay but investors showed a lot of

caution this week. what's your take on the health of the economy now? >> it's okay. i think that is a good word to describe it, not boom times, we're not off and running but growth is about 2.5%. that's pretty consistent with job growth that's 175 to 200,000 per month. pretty good. not great but just okay, i think we're doing okay. >> so we're bumping along the bottom if you will. what about the jobs picture? you predict the unemployment rate will be below 8% by year's end, below 7% by the end of 2013. what makes you optimistic here? >> well, you brought up profits, that's a very good reason to be optimistic about future job growth. businesses are doing very well. their profit margins are as wide as they've ever been in the data i've seen back in world war ii. earnings growth is slowing a bit but that's in large part because of difficult comparisons and i do think businesses are becoming

increasingly more confident with each passing day from the great recession and nightmare of the recession we're going to see businesses engage in higher -- >> 8% unemployment, people are very concerned, understandably so. the wage gap not getting any smaller. i wonder if there's some of a disconnect if you will, between how people are feeling about their personal economic stability and what the data tells you. >> well, you know, all of the trend lines are good. we're moving in the right direction and the economy is coming up on three years of economic recovery. we are creating more jobs and job growth is improving. we dug ourselves a deep hole in the recession. we have an 8% plus unemployment rate. so that's well above what we need in a good economy. that's why people are still feeling very nervous and cautious. of course, house prices, housing market still soft and house prices are still declining and down about a third from where they were six years ago and for

most people the home is their most important asset and until house prices are moving north, they won't feel great. >> that's understandable given the loss of equity people have suffered over the past few years. is there good news in terms of consumer's bolt om line. gas prices have been high but seem to be stabilizing after ten consecutive weeks of ticking up. >> gas prices seem to have peaked assuming we don't see turmoil in the middle east or something that might cause risk premium in the oil markets to rise, i think we've seen the peak for gasoline prices this year. there's the stock market. the stock market, it's hit a bit of a bump in the last week or two. but broadly speaking it's up a lot. within spitting distance of the record high for higher income households, most important for them is stock portfolios, they are feeling better. high end retailing is doing best

among all types of retail categories. >> mark, you bring up the stock market and one of the reasons being cited for the move in stock prices is the expectation that the federal reserve might do more to help the economy. the board, the federal reserve board meets this week. what are you specifically going to be watching in terms of the announcement from the fed. there's a news conference after that. >> i don't think they'll make any change in policy that the economy has performed reasonably well, okay, inflation is pretty close to the federal reserve target. i don't see any reason for them to make a change. what i will be watching though is how they characterize the economy and whether their tone with regard to their the economy's outlook, they are also going to release their updated forecast for the economy, whether that has changed in any way from what they gave us months ago. >> you're pretty optimistic but what concerns are there out there for snu.

>> there are plenty of things to be nervous about. we talked about gasoline prices and that is one. europe is another. that hasn't been nail down yet. european policy makers will need to do more. and i don't think they are going to do that unless they get pressure from financial markets. that's an issue. of course, the foreclosure crisis is ongoing. house prices as i mentioned are still pretty soft. and there's the fiscal cliff that's -- next year, policy makers don't act, we'll have pretty significant tax increases and spending cuts that will be hard for the economy to digest. there's a lot to be nervous about. let me say this, sue. all of these things, i'm nervous about, i'm less nervous about than i was 6 or 12 months ago. they are still there but less pressing than they were. >> we'll leave it on that note. thank you, mark, pleasure to see you again. >> mark zandi. now back to maria for the rest of the program. >> thanks so much, sue. up next, water water everywhere. the most abundant resource on

the planet but is it in danger? we're drinking in the data on h 20. does the foodie culture overindulge when it comes to expense? authentic eats and big business. as we look how the stock market ended the week. en we got married. i had three kids. and she became the full time mother of three. it was soccer, and ballet, and cheerleading, and baseball. those years were crazy. so, as we go into this next phase, you know, a big part of it for us is that there isn't anything on the schedule.

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prud'homme. thanks for joining us. you call water the defining resource of the 21st century. by 2013, 36 states will face water shortages. why is that? >> we have population growth and climate change. between those two things, we're using up water at unsustainable rates. witness last summer when you had 14 states across the southwest suffering record breaking droughts and wildfires. the very same time in the midwest and mountain west. you had record breaking floods. this is the hint of things to come. we're going to have to learn how to adapt to that. >> globally the lack of fresh water is causing extreme tension. we know that. you have tension in many countries. you see wars could be fought over it. are there specific countries you're watching? >> yes the corner between china, india and pakistan is a very worry someplace because there

they are all trying to suck away the him lay an knsnow melt and koreas are a concern, but even here in the united states, we have states that are fighting each other over water supplies. as parts of the country dry out and other parts of the country get wetter, with climate change, these tensions are going to rise. >> and i want to ask about the u.s. but first let me hit on china. 70% of the water in china undrinkable. >> pretty much, china is rapidly growing economy and yet the achilles' heel is water pollution and water veilability. they have something like 20% of the global population in china but only 7% of the water supplies. they are planning massive water diversions and big dam projects and these come at huge costs both economic and environmental. so water really could be the thing that hobles them, same with india. >> with limited fresh water

resources, how do you think this plays out? do you see water privatization as the future? who stands to profit? >> water privatizing goes back to france and it's become a very big global business. the water privateers play themselves down as if they are a boring utility. but the fact is they are very aggressive players and spreading all through asia and in the states, in the best case scenario the privatizers do a great job by fixing up the water supply and providing it at a reasonable cost. in the worst case scenario they have been known to gouge their customers. the difference between something like water privatizing and the oil business is that you can't drink oil. water is an essential resource, we all need it to survive. the question is an ethical one. is water a common, like the air we breathe or is it a commodity like the oil and gas that we

extract and process and then sell in the open market? and really the answer experts tell me is it's a little of both. we have to treat it as a special case. we definitely need to price water more intelligently. much of the water in this country right now is essentially free. so there's no incentive to use it efficiently. on the other hand if you price it too high people can't afford it and you're playing with people's lives. so a corporation's judge is to look for profits. if you're trying to profit off an essential resource it sets off a delicate situation. >> it sure does. >> we can succeed with under a watchful eye. >> what is the danger to large cities and water supplies? let's talk about the u.s., new york, the pipes in new york, 140 plus years old? >> yes. >> need an infrastructure build. >> exactly. you talked about this before, but infrastructure is the 800 pound gorilla that nobody wants to talk about.

you're talking about trillions of needed repairs and upgrades and nobody wants to talk about it because it's too scary. these pipes in new york city were state of the art over a century ago. now we're getting to a point where we need to invest. it's not only pipes, things like dams and levees as we learned during hurricane katrina. these are big, big projects and very expensive and yet if we don't invest, we'll suffer. >> what about the project of practi fraking and as well as the controversial way of hydraulic fracturing. will it impact fresh water resources? >> it can. in places like pennsylvania, it's been known to crack open the rock underground which allows toxins in the fraking fluid to my great in people's wells or allow the natural gas to migrate into people's wells.

and you've probably seen the people setting the tap water on fire. recently there was a rig explosion in pennsylvania. this is affecting states across the country, wyoming, north dakota, texas. this is a very controversial subject right now. part of the problem is that fracking also pollutes the air. i believe there may be a way of doing some fraking that is less harmful but the way we're doing it now it really doesn't make sense. we need to take a hard look at this and try to come up with more environmentally sensitive ways of doing this that allow us to use a cleaner fuel like natural gas. >> when do you expect this to blow up or become crisis situation? most people are not aware of the seriousness of this issue. >> yeah. well, right now, you have so much natural gas being available, you actually have a gas glut. a huge change from a couple of years ago. there's a lot of money flowing

into this sector and it's going to blow up sometime in the near future because there's so much attention being paid to it. >> alex, great to have you on the program. thanks for talking about this important topic. >> thank you. >> up next, matters of taste, an economist who thinks the american diet has impacted our innovation. tips on how to find a good lunch spot as well. find us on facebook, wsjr with maria. more people do that, security would be like -- there's no charge for the bag. thanks. i know a quiet little place where we can get some work done. there's a three-prong plug. i have club passes. [ male announcer ] get the mileage card with special perks on united, like a free checked bag, united club passes, and priority boarding. thanks. ♪ okay. what's your secret? [ male announcer ] the united mileageplus explorer card. get it and you're in.

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do foodies have it wrong when it comes to today's eating economics? >> blogger and new york times contributor tyler cowen joins me, the author of qun an economist gets lunch." thanks for joining us. >> thank you. >> you're not a big fan of some of the current food trends out there. what are for example food snobs as you write and what do you think is wrong with them? >> very often food snobs are people who use the food world to feel better about themselves, will glorify local food or slow food when in fact the practices don't do much for the environment. we need to look at the harder edged look at food using economics. >> do you consider yourself a foodie? >> i'm absolutely a foodie and i have been for most of my life. >> you say big industrial food companies have gotten a bad rap. what's good about huge food companies? >> the era of cheap food is

arguably the greatest human achievement of all time. we're feeding billions of people around the world, more than ever before, agory business played a critical role in doing that. we do need to regulate it better but foodies should start with an appreciation for cheap food and agri business. >> what do you think about the state of the american diet right now? in some cases cheap food is equal to, the wrong foods and obesity. what does it say about us the way we eat? >> i don't like junk food. i don't recommend junk food. i think we eat too much junk food and in general in this society we need more moderation but i don't blame agri business any more than i would blame the waiter. it's a decision of consumers. >> for sure, you have interesting tips on finding good food in unfamiliar places. tell us about them. have you used them? >> all the time. very often you should look tore places which are hard to find.

it's a sign they have informed customers. in general competition works, if it's an ethnic cuisine and they are competing against each other, it's probably high quality at a low price. in general, ethnic restaurants, you need to signal to the waiter you are a serious person rather than wanting something bland and ordinary. >> your ebook took on the state of the economy a few years ago, what would you say is the outlook for the middle class today? >> right now we're emerging from the recession at a very slow rate. this is likely to continue for the foreseeable future. the core problem is we have been innovating at a slower rate since the 1970s. the rate of progress slowed down. we're too afraid to take risks and lost our entrepreneurial spirit and overregulated ourselves. >> these are the issues of the day. you took a position against the

tech no logical advancement in the great stagnation, what role do you see the economy playing? >> right now we have the internet and communicationses and that's been fantastic, of course. what we need to do is in more areas have comparable advances, we're trying to run a new economic revolution on one engine, one very dynamic sector. if you look at the 1920s, virtually every economic sector was that dynamic. >> tyler, let me get your take on how food has changed over the years. given what we're seeing at the beginning of the interview, you said we're feeding so many more people today which is a real positive. tell me about that. >> well, the very fact that obesity in the united states is a bigger problem than hunger says it all. hunger in developed western nations has ceased to be a problem. the next frontier should have high enough productivity that people in africa and india

aren't hungry anymore. we're not there yet and overlooking those problems in an effort to be trendy or cool. >> good to have you on the program. thanks so much. >> tyler cowen joining us. up next we'll look at the news of this upcoming week that will have an impact on your money. where to hang your hat if you are the ultrarich. the cities the wealthiest can't do without. an airline's job, is to take you from where you are... to where you need to be. and we're not just talking about points on a map. with a more intuitive delta website and mobile app...

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look for at maria bartiromo. looking at the stories coming up that may move the markets this week. first quarter earnings are out from at&t, boeing and merck and the index following home prices in 20 cities is out on tuesday. wednesday the feds open market committee wraps up a two-day meeting on policy. ben bernanke will hold a press conference as well. on friday we get the first reading of gross domestic product for 2012's first quarter. the gdp is the broadest measure and typically a market mover. what makes a town tops. the wealth report polled individuals with assets of more than $25 million. on which cities around the world are the most important considering factors like economic activity, political

power, and the price of luxury housing, here's the list of the top five. london, new york, hong kong, paris and singapore. but interestingly, when asked which cities will be important in ten years, numbers three, four and five are all in asia. by beijing, singapore and shanghai, a sign of our times. next week join me for el-arian. have a great week everybody. i think it's final seconds, ohh, shoots a three, game over. so two seconds ago... hey mr. and mrs. harris, where's kevin? say hi kevin. mom, put me down. put...the phone...down. hey guys. did you hear... the choys had their baby? so 29 seconds ago. well we should get them a gift. [ choys ] thanks for the gift! [ amy and rob ] you're welcome! you're welcome! [ male announcer ] get it fast with at&t.

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