free hair cuts it's a cry for help but i like jcpenney. they're depressed and a time probably to pick them up. trades above 24, take it more. >> earnings on friday. with that, jim, see you later. sue? >> that's right. "street signs" begins right now. see you tomorrow. i'm hampton pierson reporting live in washington. the headlines are these. modest fractions of banks eased lending standards. large fractions reporting stronger demand for many types of loans. on the commercial side, banks are reporting a small increase in demand but it's coming from medium and large market firms, however small market firm unchanged. loans to household, biggest demand increases for prime mortgages and auto loans in the last three months, lending standards for mortgages tightened for nontraditional products. household loans had a little higher demand and standards left unchanged. some easing in car and credit card standards.

domestic banks have been loosening the standards. foreign affiliated banks tightened. the result being domestic banks reporting picking up more business of foreign banks and in a special question added to the july survey, the banks said the harp loans make up a significant share of re-fis and anticipate over 60% will eventually be approved. back to you. >> all right. hampton, sounds like hopium there. thank you very much. now for "street signs." best buy's founder says it's time for him to take the baby private. we'll talk about if it's a good deal and which companies are next to try to get off the street. are you ready for the retail olympics? who's likely to medal this back to school season. whether your dollars should be used to fund space exploration. rejection and the super rich. in new york cash is not always king of the real estate world. >> money cannot buy you anything

and everything. the dow over the case of the mondays. if it can finish the day higher it will break a losing streak of nine straight mondays. s&p 500 trying to finish the day over 1,400 first time in more than 3 months and nasdaq making a round number push, as well. trying the first close over 3,000. that would also be a more than 3-month high. let's get down to bob pisani at the nyse. trying to break the case of mondays, bob. >> yeah. once we got past the ecb meeting and everybody convinces them that mr. draghi is more dovish, we have been off to the races. we are 100, 110 points shy on the dow, mandy, from a new high for the year. we're three-month highs right now. the dow jones industrial average continuing to hold up very well. since thursday. friday morning better. same with the s&p 500. we are maybe 20 points away from new highs for the year and as you mentioned trying to now get over 1400 on the s&p 500.

knocking at the door of 1390 and change right now. the big thing that's happening, important, the rotation. remember, we've had all those dividend players doing really well. just about to break 140 on the s&p. telecom stocks, pharmaceutical stocks. but in the last few days, laggards have been coming to the fore and consumer discretionary. that's what you want to see and what's happening here is a bit of a short squeeze in the euro. art cashin talked about this earlier in the day. sitting at an essentially new high for the month. one-month high on the euro versus the dollar. mandy? >> thank you very much. meantime, i believe rick, you have, got gas prices on your mind. when's the price at the pump in chicago these days? >> well over $4. as a matter of fact, i'm paying like $4.17. i asked one of the guys in tech ops what he paid on the east coast of new jersey he said 3:50. much of the country 5 to 8-cent increases over several weeks and

the midwest closer to 25 and 30 cents and states like indiana, illinois, wisconsin, michigan, specifically wisconsin and illinois, have seen 30-cent jumps in that period. there's a lot of reasons, a rupture in wisconsin pipeline. refineries in illinois have some issues. but in the end, nobody's talking about it. we're well over $4 in much of chicago and the suburbs. and areas of the midwest. and i think it needs to be discussed more. no matter what the issues are, this country runs on energy. and when gas starts to get above that $4 mark, people are not going to be happy. >> they're not going to be happy. time to get out the bicycles again, rick. thank you. >> thank you. your big corporate story of the day, best buy's founder making a bid to take it private. offering $24 to $26 a share. take a look at the stock. values, well, down. well, i shouldn't say it's down. not near the price that they expected to buy it on. given this is my name in the

stocks draft. values the company just under $9 billion. best buy says it's considering the bid but here's the bottom line questions. is it a good deal for shareholders if it's done and manager to work even if it gets done given the structural issues they face? with us on set, jan niffen as well as mr. herb greenberg, as well. jan, if you're richard schultz, would you buy or try to buy best buy? >> i think it's a good idea. i think he'll do well. if you have a billion dollars to put in of your own, you can get private equity guys to play with you. i think it's financeable up to $29 or $30 a share. not where it is now. >> why do you think it's trading off the offer price? >> i think it's trading below the offer price because people are saying right now this can't be done and financed. they'll never come up with $3 billion of additional equity they need. i think it can be done and

big-time private equity guys that understand retail to play in this gamble. >> on that note, i spoke with a source earlier today as an investment banker, won't go on the record. he said he thought it could get financed and raise the debt side and wouldn't be easy. you agree with that? >> i agree it wouldn't be easy. >> it can be done to your point. >> the biggest deal done in a long, long time. it would be a lot of money to raise. however, i think the money's available and i think the right private equity guy can make this happen. >> past the board, though? >> well, i think at some price whether it's $29 or there is 30 or $26 or $27 the board runs out of options. >> this may be a savior for the board because for this to work, this company, i think it's done outside of the public venue. all of us aren't pouncing on them on every step.

schulze needs this like he needs a hole in the head. he knows about the bodies at the corporation and what can be done. let me point out one other thing. a week ago i floated that sort of crazy idea of amazon to buy best buy. the dynamics are continuing to shift. he sees something. you have to understand. of course, is it the ego? i think he sees something. >> we feel the same way and disagree a lot and don't disagree on this one. i think he understands the business. he understands he's got too big of boxes and understands the need to fix the boxes. he needs some show rooms. herb told me i couldn't call them catalog show rooms and the ability to make it happen. >> why do you think he's saying that if this goes through he doesn't want a management role? do you think he should take a management role. >> i think he will. >> why does he say he doesn't want to? >> looking for other players to help him. >> as the owner, he is the boss. >> he is the man. >> taking a management role

whether -- >> his money is managing. >> he is the boss. can we move on to another name? radioshack. >> radioshack, obviously. >> kind of moving up a little bit today. there's been some names floated out there as other bankers start to sniff around. companies of growing sales and stock didn't perform. what about staples? is that a buy-out candidate? >> i think that anybody with solid cash flow and staples doesn't have that strong of cash flow is, in fact, a buy-out candidate right now. however, i think that private equity guys prefer companies with not much on the balance sheet with assets, mall based, steady cash flow through the recession and are, therefore, look like a bond. >> what do you think, herb? >> no. we were talking earlier. we talked about staples and doesn't have the cash flow of best buy. it has a -- >> it has gone up. >> same net debt as best buy. >> 2 billion. >> about 2 billion. both of them. you still have office depot and

office max in the space to be -- >> but i have to say, sales have grown at staples in a few years even as the stock from 30 to $13. >> i don't think anyone -- >> an it's done it before. >> they'll be the last man standing in that -- >> i agree with that. >> okay. it's worth noting one brian. the sullivan, the gentleman next to me is kind of puffing out the chest today over best buy. listen to his pick in our stock draft. >> i will pick best buy and the reason that i would select best buy, i'm just saying you look at the balance sheet. they're in trouble. they still got a lot of cash flow. the perfect lbo candidate. i would buy best buy purely on the speculation to be bought. >> not because i screwed up. saying i'd buy facebook and ad libbing. that was the pick. you look at the numbers. going to the figures. maybe, you know, blind squirrel catches a nut once in a while. >> here's the standings right

now for that stock draft. you have, for example, at the top of the board, herb! >> he should have his chest puffed out. >> my goodness. middleton at the second and the rest of us down there. i did as you said pick facebook. >> you are in dead last, actually. >> thank you. thank you for pointing out that. my chest is not puffed. let's get to the olympic worthy retail picks of a man institutional analyst six years in a row. the specialty retail analyst. brian, great to have you with us. since it's the middle of the olympics and going for gold here, who deserves the gold medal? >> yeah, so, we put out the top ten, you know, list last week. you know, really talking about how coach, you know, we think, got a little overslammed last week and gave coach the gold medal but before that it got our bronze medal for taking couponing out of their factory stores. which you can't do right now. the consumer's fragile. you have to give them promos. but they put it back in.

coach, they have a gold medal. stock's probably going back to the 60s. >> there's always a few names out there in the olympics and people think they win gold or at least a medal but they kind of don't. is there a noticeable or notable absentees of the list here? >> yeah. i mean, the two called out, a o aeropostale was a fan favorite. the judges pulled the silver medal. stock down 35% on thursday and clearly had to give it back. abercrombie & fitch, they guided $4. 75 for this year. they're lucky to do $2.75. that's another one taking it on the chin. >> brian, liked at the screens last week. the gap up 80% years to date. is the restructuring and rebirth of the gap for real?

>> we probably still have another three to $4 left in the stock. you know? it's been an active money manager's sort of, you know, not needing to own stock for a couple of years now. they bought back half of the stock in the last five years. the gap division, it's lost 20% of its sales productivity in the last four years and just the slightest hint of things in the right direction and money managers need to own the stock. they haven't in years so reasonable valuation, if you look globally against h&m or fast retail, gap's still trading at a three-multiple point discount for global money managers out there and taking a look at it. >> thank you very much for joining us today. >> thank you. next, a couple of top market watchers with soda, snack food and tooth paste on the shopping list. plus, first on cnbc, the ceo telling you why he thinks days

of the big banks ruling the market are coming to an end and it has nothing to do with the government breaking them up. and as we go to the break, look at the dow heat map. most of them this the green. we have a few notables there in the red. disney, for example. j & j is down, as well. ttd#: 1-800-345-2550 ttd#: 1-800-345-2550 let's talk about the cookie-cutter retirement advice ttd#: 1-800-345-2550 you get at some places. ttd#: 1-800-345-2550 they say you have to do this, have that, invest here ttd#: 1-800-345-2550 ttd#: 1-800-345-2550 you know what?

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welcome back to "street signs." looking at shares of viropharma.

up sharply to the tune of 12% to 13%. fda afrooufl get to industrial scale manufacturing of a treatment for -- i won't go in to details for a hereditary skin ailing of swelling and going to industrial scale. a huge pop for the stock. back the you. >> indeed it is. pandora's stock is pumping up the volume after active listeners increased 48% in july and listener hours topped a billion. that's a 76% pop from a year ago. well, unless we get a total reversal, looks like it's not unlucky ten for the market. one of the most read on cnbc.com is a piece about how feem are feeling optimistic on equities. is our next guests? let's ask them.

all right. so mark, i want to begin with you. the dow up nearly 8% year to date. how much more is left on the upside? >> well, brian, we came in to the year thinking we might see something like an 8% increase for the entire year, let alone the first seven months and change. but we are most optimistic of 1425.50 with relief on the european front and evidence that china is able to navigate to a soft landing. i think while those two issues are open ended, policymakers are looking to solve for the macro risks and i think we see further upside. >> are we up in spite of the things you mentioned or despite those things? in other words, if we get a resolution to the fiscal cliff and to the european uncertainty, could the dow take off? >> well, i think it is more despite and i think it does have further upside because i think multiples are pressured by the

fact that those macro risks are significant and take multiples off of the market. if we have some relief on that front, i do believe we have a potential up draft in equity prices to take us up in to the mid-14 range without much hesitancy. >> rob, come in on the conversation. mark said he sees further upside. three-month highs for the market. where do you see us going? >> it's good to see the rally of the market for a change. yes? >> yes. >> it's clear that certainly at jensen we don't believe we're out of the woods yet. and the euro debt crisis really has yet to be resolved properly. but having said that, there's some real opportunities we believe in some quality growth companies that we invest in the jensen quality growth fund. >> which ones? >> companies, for example, like colgate. tooth paste and hygiene products company. the world's largest manufacturer of needles and syringes and

interesting electrical connector business. very high return on equity businesses, strong cash flow that your previous guests talked about. very, very important to allow the companies to produce good returns for shareholders in good times and bad. >> what's better, the huge caps or small caps entirely domestically related? >> we continue to lean in to the big caps with the high dividends. in that low growth world, income matters a lot relative to total return and investor realize. i fade more of a global theme to a domestic approach given the fact that the u.s. economy is cleanest shirt in the hamper and i think with stable if lackluster domestic conditions persist. domestic oriented companies will continue to see steady if not rising profit growth. >> rob, to that point, you alluded to the economic headwinds here at home. might bad news translated by the

market as good news because it might make them feel to get more fed juice? >> well, very much so, but that would be pretty weak foundation to build a case for equities because -- >> and yet been the case for the past few years. >> it has, but today, the fed's ammunition box is looking pretty empty. however, to your point, it is important not to bet against the fed. that could be a doing you game. so what we look for as mentioned earlier, high quality companies that despite the headwinds and the challenges in the economy both here in the states and around the globe have the durable competitive advantages for business value and we believe shareholder value over the long term. >> mark and rob, thank you for joining us on this monday. >> thank you. >> thank you. now the headlines outside of the business world. jackie? >> thanks so much, mandy. lieutenant brian murphy, a first responder on the scene at the shooting at a temple in southern wisconsin remains in critical condition after being shot nine times. meantime, the gunman that killed

six people is identified by authorities as 40-year-old former u.s. serviceman wade michael page. the fbi says that it's not determined a motive for the shooting but is investigating potential ties between page and white supremacy groups. mars rover curiosity already sending back images and data just hours after landing on the surface of the red planet. nasa mission controllers cheered when they confirmed the safe landing after sailing through space more than eight months covering 352 million miles. the project cost $2.5 billion and searching for signs mars may have once possessed the ingreed y cents for life. >> should the government be funding it or not is the question. just ahead, lifestyles of the rich rejected. we'll take a look at even how the super rich can't buy their way in to new york's biggest apartment buildings. herb is ready to do downward dog in the disaster du jour and why lululemon is added to his

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effect for comcast. year to date, the shares surged close to 50%. the majority owner of our parent at nbcuniversal. brian? robin leach, eat your heart out. tonight on cnbc at 8:00 p.m., inside the lives of the super rich. and one of the things to find out is that sometimes all the money in the world cannot open some of the world's most exclusive doors. robert frank here to explain. >> thanks, brian. the island of manhattan is 23 square miles of high priced luxury real estate and can be one of the toughest places for the wealthy to live. everyone from pop stars to athletes to billionaire c 0e eos tb shut out of. we start at the dakota. attracts a lot of super rich buyers but not all of them can get in. melanie griffith and antonio banderas were denied. singer cher rejected.

a-rod, also struck out. 820 5th is exclusive. valuety no didn't make the cut. the co-op board rejected casino developer steve wynn. now, 435 east 52nd, the last address, so exclusive that the building management doesn't even want the property's name listed in advertisements. the river house. socialite and designer gloria vanderbilt was turned out and richard nixon. you're not guaranteed a spot in the top clubs of manhattan real estate. >> why? on what grounds? >> sometimes it's financial. a lot of buildings you need ten times the purchase price in cash afterwards so i don't know what richard nixon's finances were but that's a reason. sometimes no reason. they interview the pets and they don't like the pets. sometimes they interview your former neighbors and they find

you're not very neighborly. so sometimes you don't know the reason but it's a fit an you're business partners with these people. so they can say, look, if we don't like you as a business person, you won't like you as a neighbor. >> didn't like sonny and cher's song in '73 so i wouldn't let you go. >> i wouldn't want to be a member of any club that would have me as a member anyway. >> tune in tonight right here on cnbc. but next, the housing hopium. sickly chicken. and some drugs. it's all part of today's "street talk." behind the wheel of audi. just passed caddy in the rankings. lexus, beamer and benz, audi wants to be there, too. helping business, do more business. in here, opportunities are created and protected. gonna need more wool! demand is instantly recognized

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welcome back to "street signs." brian shactman here with a look at a stock we talk a lot about here. navistar. up about 7%. the issue is can they pay a fine to sell engines that don't meet emissions standards. the u.s. epa on saturday filed the final ruling on the mechanism to allow them to pay

fines to sell the engines. stock is up, but mandy, we don't know the ruling. the investors going in here thinking it will be a favorable one but we don't know. >> we don't know. we brought herb over to the studio. >> it's so much bigger than that. there's much bigger issues beneath the surface. i'm not here with the ruling. no matter what happens with the ruling, there's more going on. because remember, the company's trying to morph over to a new engine. people are trying to figure it out. getting the ruling we'll definitely -- >> of course, we'll break it here on cnbc. that's what we do. back to "street talk." talk about cognizant tech and soaring after mega earnings. >> that stock up 12% here, in fact. first quarter earnings. ding pretty well. posted a 21% jump. i should say fiscal second quarter profit. sales jumped double digits in all the segments and raised the full year earnings guidance.

that stock with today fractionally positive for the year. >> not even 1% but almost there. talk about hca holdings. down more than 6%. >> yeah. well about 6% now. in fact, two reasons here. number one, the company received a request for information from the u.s. attorney's office in miami about the cardiological services and then in a conference call, the ceo warned about an upcoming story in "the new york times" and believes based on i guess the tone of the questions he got that the reporting may paint a negative picture. we don't know if the article is coming out and said we think an article is coming out and not flattering. >> regarding whether or not some medically necessary procedures were performed and all comes down to the controversy about fee for services opposed to putting doctors on a salary which i think is a good idea. also a blue money for interpublic group. >> yeah, whoops. this stock is down 8%.

because france's publicist denies a report of approaching interpublic of a deal. they soared after the ft reported they had approached interpublic group. that stock soared. giving it back today. the ft with a little bit of egg on their face today. >> analysts raising the roof on visa home ratings. whoops. we move along. we got it? voila. we ask. we receive. up about 2.5%. >> yeah. two firms raising the rating. neutral to underperform and market perform at wells fargo. this company, though, underperformed almost every major home builder over 52 weeks. but two firms saying they're a little more optimistic. >> the ceo saying the housing market is recovering. anyway, chicken stock declawed.

excuse the pun. >> quarterly profit fell 61%. volume not just for chicken but also for beef and prepared foods. volume only up for the other white meat, possum. that's not true. pork. pork. the c eo also saying the ongoing drought forces slaughterhouses to close because cattle dwindle and mildly optimistic of the restaurant business ian the chicken business profitable next year and a good thing and positive upside when you think about those grain prices. >> i don't know how they get the little chickens that are square and delicious. >> delicious. will the banks meantime, moving from chicken to banks, break themselves up? one bank ceo says the market is sending a message that they're just too big. joining us first on cnbc is tom mishio. thank you very much for being with us. what do you mean by the market

is sending a message to these banks that they need to break themselves up? >> mandy, what i think is very interesting is that when you look at the valuation of the universal banks in the united states, there's a clear distinction of those stocks and those of the super regional banks. frankly, they're trading at about half the price to book, tangible book value some of the higher quality super regional banks are trading at and trading at two thirds of book value, that basically tells me that it's unsustainable and over time one of two things has to happen. either the performance of the banks has to improve or i think that pressure will build on the management teams to shrink their banks, realize book value, possibly repurchase shares if that condition continues. >> i know you think it's something not just a huge, big, one fell swoop and break themselves up. this could be a bit by bit gradual process. who do you think is most likely to start this process? >> you could probably look at the banks that probably traded

at the greatest discount to book value. tangible book value. that would be banks like bank citigroup and morgan stanley as possible candidates. jpmorgan is going better. >> why would the banks do it to themselves? >> my view is that these companies are still run by talented folks who understand that if they can realize book value by selling assets, continue to delever and already starting to do it. citi holdings is one big portfolio in runoff. they continue to realize book value, capital will build and if the economy doesn't improve and if their business model has changed so much that they don't have an opportunity to make money i think that they'll return to share repurchase. >> tom, listen. i know you do a lot of business with the companies and trade their stocks and everything but listen.

could god run these companies? they're so big. who can possibly understand all of the business arms? >> so what you just touched on, an opinion that i do have. which is that i do think these banks can get too big. when we founded our company in 1962, the largest bank in the country was 5% of the nation's assets. today jpmorgan is 17% of the nation's assets and what the market participants sometimes miss is excellent super regional banking companies to fulfill corporate america needs, pnc, suntrust, bb&t. really good companies to full till the clients' needs. i don't think you need banks that big to serve most of corporate america. >> tom, i think what's interesting here and what's quite ironic is while you think that some of these big banks should perhaps break up but with the difficult environment the smaller and meemd-sized banks should huddle together. who do you think are the likely

candidates? >> we have a consolidation candidate list that's out there. but basically, we think there's more consolidation and we think that a lot of the higher performing banks will be the super regional banks on down. we don't think the highest performing banks are universal. so really, you could look at almost -- >> sorry, tom. define a universal bank. >> so a universal bank is a bank typically a commercial bank and an investment bank and banks put together after glass steigel and global and a lot less global than maybe a bank america or a morgan stanley is and they have universal banks in europe, as well. deutsche banc, for example. these are the companies put together under the premises of a commercial bank and investment bank at the same time and my point is for most of america, there are some great super regional banks like i said like pnc, for example, that could fulfill a lot of the needs of corporate america. >> bottom line, you don't think

the regulators break up the banks? >> i think that market forces do it on their own and a lot of features of dodd-frank will cause it to happen. the higher capital ratios that these universal banks have to have is going the drive a lot of this deleveraging. >> thank you very joining us. >> thank you. well, the president is in the oval office for a bill signing for american veterans. he was just asked about yesterday's just awful temple shooting outside of milwaukee, wisconsin, at the sikh temple. the president, again, signing a bill in favor of american veterans. here's what he had to say about yesterday's shooting. >> mr. president, gun control measures? >> well, first of all, you know, we're still awaiting the outcome of a full investigation. yesterday, i had a chance to

speak to both the governor and the mayor, as well as leaders of the sikh community in oak creek. all of us are heartbroken by what's happened. and i offered the thoughts and prayers not only of myself and michele but also of the country as a whole. i think all of us recognize that these kinds of terrible tragic events are happening with too much regularity for us not to examine additional ways to reduce violence. and as i've already said, i think there are a lot of mmts involved in it. what i want to do is bring together law enforcement, community leaders, faith leaders, elected officials at every level to see how we can make -- continue progress. we don't get yet know fully what

motivated this individual to take on the terrible act. if it may have been motivated by the ethnicity of those who are attending the temple, i think the american people immediately recoil against those kinds of attitudes. and i think it will be very important for us to reaffirm once again that in this country regardless of what we look like, where we come from, who we worship, we're all one people. and we look after one another and respect one another. but as i said, the fbi's working with local officials and they're still investigating what motivated this individual. and as we find out more, i suspect that not only the white

house but others in congress and at the local level will have more to say. all right? thank you very much, everybody. thank you. >> president obama speaking about the tragic wisconsin shooting yesterday. we've got lots more things coming ahead on "street signs." another major story is the mars rover mission s. this proof we need nasa after all? audi's hot new ride hitting show rooms in america. we'll hear from the head of uaui usa and whether they're ready to take on the big three in luxury. i've been a superintendent for 30 some years at many

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here's your invoice. there's gm an ford struggling this year despite the signs of recovery in auto sales and softer july numbers, sales still on pace to crack 14 million units this year. well, at the high end, audi looking to crack in to the top three of luxury brands and hoping that a hot u.s. debut might nudge that needle. phil lebeau joining us from burlingame, california. >> reporter: and here's the vehicle we're going to show you, brian. the rs 5. there's a limited number coming to the u.s.

1,500. i had a chance to drive it yesterday. you're a car guy and love to have driven this vehicle. amazing. 450 horsepower. it is a 69,000 sport vehicle that's going to turn heads over the next couple of years and limiting production and sales here to about 1,500. when you look at luxury sales in the united states, take a look at what audi has done relative to the competitors. growing sales faster than bmw and the market, faster than mercedes benz. the flip side of this is audi continues the fight the perception, real or imagined, that it has quality issues. in the latest j.d. power initial quality survey, audi the only luxury brand that didn't beat the industry standard. the president of audi of america says they're making strides when it comes to quality. >> i think we are looking at two things as you know. industry wide, quality used to be things breaking. and if you look at audi, it is

not happening. warranty claims down 60% over 4 years. what is happening is concept. and we as a brand can definitely do a better job of explaining the concepts. >> reporter: and overall, the residual value of audi improving in the united states. looking at shares of volkswagen, the parent of audi, this is one of the fewest auto stocks to withstand the huge selloff we have seen for some of the other automakers and feeling pressure because of what's happening over in germany. guys, the rs 5 and, $69,000 and amazing. this has some get up and go. >> i know. i just -- i'm so jealous. i have to throw that out there. you know? the rs-5, looks -- online, looks awesome. >> because it's a red one, goes faster, right, phil? we have to leave it there. thank you for joining us. coming up, the case for space. >> without nasa, could the mars rover and other deep space

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whoo! >> that was awesome. eruption celebration at nasa last night. curiosity touches down on mars. landing cap as $2.5 billion mission to the red planet. curiosity will take soil, air samples to see if there was once life on mars. perhaps one of the most significant parts of last might's landing is the renewed debate over space and as taxpayer exploration funding -- a necessity or simply a waste? joining us by phone is bill nye, the science guy. executive director of the planetary society. when you factored out, bill, comes to about, i think, seven bucks an american or seven buck as household. that seems like a good deal to

me. >> oh, yes. especially that spread out over several years. depending on 10, 12, 15 years. so it is -- not even a dollar a year. >> in terms of the economic benefits, we would be looking at this as -- an investment as opposed to an expense? >> well, that's -- my side of the story, yeah. i represent the world's largest nongovernmental space interest organization. we have people who are passionate about this. let me point out, let's take the example of the jet propulsion lab in pasadena, california. the high school which is right next to the lab is an excellent school. everybody wants top send their kids there. the needle schools that feed that high school are also excellent because there are scientists and engineers that go to the high school. very good teachers want to teach there. furthermore, the area around it is a lovely neighborhood where people want to live. these are middle class people with jobs. and all this, the economy there, is stimulated by a very small

investment. in space exploration. >> bill, our next guest will argue -- >> economic benefits. just right there. >> our next guest argue you are right about everything you are saying it is ever, it is that the private sector could do it as well and for a lot less money. >> no. i appreciate that point of view but i -- let's look at history. christopher columbus, francis drake, louis and clark, these people were funded by government. then the east india company shows up. then hudson bay company shows up. then the wells fargo wagon starts going across the north -- across north america. government exploration first. there's not an especially compelling business case to explore mars. however, my friends, this is recover discovers a layer of minerals, whether it be acidity of the soil, php. hydrogens of

the soil, are such that we discover a layer of fossil microbes, the world would change. our world would be completely different. it would be like discovering the earth goes around the sun instead of the other way around. this brings out the best in us. >> yes, i guess it is also a matter of national pride. just hold the line there. we want to bring in katherine ward, managing editor of "reason" magazine. i will put what brian said a moment ago, do you think we -- private monday why you into this, we could do the same thing, achieve the same goals, but perhaps cheaper and more competitively? >> you know, one thing that's great about america and this sort of capitalist world is we have a lot of people who are just crazy, crazy rich. a lot of those guys were really into space when they were little kids. they imagined, you know, being astronauts before they decided to find facebook or whatever it

was. i think the question isn't should we be doing these things, going into space, it isn't does it create nice elementary schools in the neighborhood, it is would they be happening anyway without government? i think in many cases the answer is yes, certainly it is true for kind of every day boring space stuff like getting back and forth to the international space station which private companies are poised to do right now. it might be true for big signs, too. >> to bill's point on the surface you say well, let's go to mars and looks like a wasted trip. there is nothing there, everybody knows that. what if we landed there and we were -- found out it was made of gold. right? or -- to bill's point, priceless minerals. if things look smarter, sometimes don't you have to spend the money to figure out what you got before you do? >> sure. that's -- that's what businesses are great at doing. i think you have just -- made your case for me in a way. if it turns out mars is made of gold, that investment will be paid, repaid billions of times

over. and even if it is a government rover that finds out that mars is made of gold, as bill nye notes, it will be private companies that figure out thousand commercialize it, get the gold down here to turn into useful things. sadly i don't think it is going to turn out mars is made of gold. although maybe, i don't know, green cheese important the moon, we'll see. >> a lot of great things that come out of nasa's inventions. >> you are miss inging a very important point. this exploration is not for commercial purposes. this is exploration for exploration sake. you say what are you going find there? we don't know. that's why we are looking. i remind you that the soviet space agency, then the russian space agency, has tried to land on mars and -- let me start by saying they took the pictures of the far side of the moon. they did the first sample return by robot from the lunar surface.

people forget in 1970, russia brought back moon rocks robotcally. >> i hate to cut you off. >> land on venus. even that space stationsy is 0-21 for mars. on friday, space x boeing and sierra, nevada, corporation were awarded close to a billion dollars by the u.s. government to support their commercial efforts. it is not rich guys going out and just doing it on their own. >> we hate to cut you off -- >> we love this segment, too. thank you very much to both of you for joining us today. we are going to be back in just a second. it's a golden opportun. to drive a car filled with as much advanced technology as the world around it. with the available lexus enform app suite, you can use opentable to make restaurant reservations... search with bing... and listen to pandora. presenting the 2013 lexus gs, rx and the all-new es, the leading edge of the leading edge. during the golden opportunity sales event, get great values on some of our newest models.

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