schwab's global research. tdd#: 1-800-345-2550 they give me equity ratings on foreign stocks tdd#: 1-800-345-2550 based on things like fundamentals, tdd#: 1-800-345-2550 momentum and risk. tdd#: 1-800-345-2550 i also have access to independent firms tdd#: 1-800-345-2550 like ned davis research and economist intelligence unit. tdd#: 1-800-345-2550 and with my schwab global account, tdd#: 1-800-345-2550 i can trade directly online in top markets tdd#: 1-800-345-2550 in their local currencies-- when the markets are open. tdd#: 1-800-345-2550 plus, their global specialists are on call around the clock. tdd#: 1-800-345-2550 there's a world of winners out there. tdd#: 1-800-345-2550 and now i have a better shot at finding them. tdd#: 1-800-345-2550 now get our best global offer! tdd#: 1-800-345-2550 trade commission-free online through september 2013 tdd#: 1-800-345-2550 when you open a schwab global account. tdd#: 1-800-345-2550 call 1-800-308-1280. some exciting and very good

news on the hiv front. a baby born with the disease but treated aggressively with the anti-viral drugs 30 hours after birth has been cured, cured, two and half years later. the cure could revolutionize the way babies born with hiv are treated. merck, pfizer and sciences are among the drug makers are among those with the hiv drugs. gilead down just a penny. >> such a fantastic story, ty. we have been flirting with the unchanged level. we are down only about 4.5 point and s&p is positive. not by much, just a half point but heck, the bulls will take it and nasdaq composite is up half point, ty. so mark set improving today. >> anyone who thought the big spending cuts were going to absolutely eek out the market, they would be wrong for at least today.

thank you very much. thank you for watching. that does it for "power lunch." >> "street signs" begins now. ty and i will see you tomorrow. have a great afternoon. >> warren buffett, china and the markets trying to make a come back, oh, my. that kind of a day here on "street signs." we will tell what you the chinese government did that has some investors spooked. warren buffett says some stocks are still a bargain and he is a buyer of a buffet of names that he likes, ahead. why some mortgages will look like sub prime mortgages and one trade in commodities you must make right now. how is that for a tease. >> that is a good tease. good morning ppg dow is less than 1% away from all time closing high. it is, however, held back today by global economic worries. which ironically comes as over

$55 million for global equity funds and etfs in january and february. that, is the biggest two-month inflow on record. even trim tab says concerned, seeing extreme enthusiasm for stocks, particularly emerging markets and china should worry bulls. bob pisani, do you agree, the big inflow from fund investors off tern can occur in market thoughts. >> that's all own wall street chestnut. i think today we are having a growth scare around china. let me show you what is going on here. china over the weekend put the brakes on secondary property mark. which has been growing rapidly. remember this whole china improving bid has been around for six months now tp it is driving up the price of copper, iron, ore and steel. it will slow down prices and enkras inventories of the commodities. if you look at copper stocks,

aluminum, put up some of them, you will see they are all down about 2 to 3% here. there is cliffs, all of the big steel companies. he people have been asking me, by the way, how can this be slowing the property market down? take a look at percentage of sales and big citie in china that are from secondary markets. look, 57% of the sales are secondary homes. shanghai, 52%. beijing 43%. so there is a huge business out there affecting commodities. >> let's stay with this theme. i might clutching to straws. m. >> it definitely wouldn't hurt the appetite for treasuries. i think it is time for japan to have its charlie prince moment, if you recall, executive city to

the financial times in 2007, talking about the enormous liquidity and all of the lbos aught that were out there. as long as the music keeps playing, you have to get up and dance. we're still dancing. so i think that bad things can happen. you heard tyler, michelle, sue, talking about 10% of this irgdp comes fromding. all of the taxes they put on. but in the epd end, the crony capitalism in china will definitely at some point do what it did here and i think the outcome will be similar. i don't see necessarily a flight to safety lasting. it would be the knee jerk reaction treasuries but i think we would lose a real sponsor of our paper. >> okay, thanks very much, rick. thank you, bob. as we've just been talking about, china is taking steps to cool down. still red-hot real estate market. just last night, 60 minutes had a report on chinese real estate. so-called ghost cities. this is mild and miles of empty

residential apartment buildings, way ahead of demand and they are developing ghost toups across the country. there are concerns the real estate bubble is about to pop. michelle, you've been following this story. it is not just an economic concern. this is a social stability issue the chinese government is worried about. >> and it seems like china is trying to pop the bubble. there was news over the weekend sending the market slower, shanghai plummeting. the shanghai dropping the lowest in year. sheer what happened. late on friday, chinese government imposed a new set of rules, considering to be the most damaging, 20% tax on capital gains sale of the home. you used to have the choice to pay 1 to 3% of sale price.

most people did that. the down payment at second homes was 20%. plus you can't buy a home if you can't prove you paid local taxes. why american investors should care? one simple data point. accounts for 20% of china's groet gross domestic product. however, skeptics of the chinese economy long pointed to ghost cities, highlighted and a drop in prices is long been seen as inevitable. talking about it all the time on cnbc. so, some would argue this has to happen regardless. >> and they bring out different property curbs. >> yes, over and over. >> over and over and over again. is it because the original ones are not enforced properly? >> because people have no choice. suddenly you have a population with a lot more money but the stock market is too small, too risky, too rigged. the only choice really is property. so people by two, three, four homes because they are desperate

to put their assets some place. that's what happens when money is kept cheap all over the world. are desperate to get a return somehow. >> so stick around. we will bring you senior analyst covering china at eurasia group. nick, bottom line, is there a bubble in china and the real estate market there? >> i think absolutely there is concerns in the major urban city markets. but i don't think this is a story in 2013 that will bite. i think what we are talking about is a government that actually on the positive side understands that they have some structural imbalances regard is investment and speck lasive investment and residential property. since 2010 has been much more aggressive in trying to control that. so they've got levers at their disposal and i think we are in a government where the government is trying to get more involved. all indications are that since 2010 they have had a lot of success there.

yes, too much investment. yes, related to the -- >> so you say this is a manageable bubble? >> i think it is in the near term, absolutely. >> when you say the near term, whalts the -- in the beginning of the answer you said, this is an story for 2013. if not 2013, then when? nick? >> what i'm looking at as biggest potential driver, a real comprehensive slow down in residential in china is account revitalization. the key issue is that capital account is closed. if you are a wealthy chinese investor you have limited options. chinese are trying to open that so they have more options outside the domestic market. but i don't think it will move the next five years. so there is momentum related to the invest pt activity. >> those who argue that you shouldn't worry about the situation say the following.

think of china itself entirely as its own balance sheet. don't think of individual banks or individuals. let's say you have 10% goes bust. they've got $13 trillion in cash assets to thwart. >> history is littered, michelle, with people saying that countries, companies, situations, are different. oh, no, you can't make that aknoll j aanalogy, it is different. greed, speculation, bubbles are the same no matter where you are. >> i agree. but they have a a lot of cash for a lot of pain for a lot of people. >> and nick, do you agree that it is different in china? >> here is the key point. it is a question of policy capacity end the government band width. yes, they have a lot of cash at their disposal. it won't be a financial problem. it'll be a fiscal problem. they are very capable of be a,

so that. >> but if the economy goes to pot, things will change their cash generation for exports, will slow down. because a slow down in china will hit a little country called australia. japan, pac rim, united states, and their trade imbalances will narrow and they will dry up. >> what happen fess they have to sell treasuries to sell off. >> yeah. sorry, nick? >> there's no question there is a medium term risk here. it is related to the bigger picture of reform to the financial system and the way it operates in china today. but i see no real compelling reason to believe in 2013 there's some structural driver that is fundamentally different in terms of what changed in terms of the drivers of growth in china domestically and internags internationally. so until there is a concern for

changing reality, i'm not concerned about it right now. >> nick, please for being here. great to have you. >> thanks for having me. >> up next, warren buffett stock buffet. one of his favorite picks. and more names he likes also. >> tgoogle, hitting another all-time high today. what's its secret? >> first, this day in history, 80 years ago today, fdr was inaugurated as our president. the highlights of the depression in a very, very powerful speech. fs we'll be right back. some new members of the team will be introduced. the chairman emeritus will distribute his usual wisdom. and you? well, you're the chief life officer. you just need the right professional to help you take charge.

♪

and of course these cuts will feeffect our military, civ servant, construction workers, even grants to native americans. and i'm the one who has to tell these folks yb young man, there is no need to feel now. young man, pick yourself off the ground. young man, just because you're funnin us now, there is no need to be unhappy. >> that was the saturday night live gang having fun with the

sequester. maybe some ymcas will be impacted. who knows. r right now, the market isn't talking much about the sequester. but it is one of the billingest connen froms of the year. steve liesman is there with a special guest. steve? >> was that your idea i get to follow saturday night live? >> know, you'd look good in a cop outfit. just being honest. >> thanks, my friends. i'm here with john taylor. former deputy secretary for international affairs. john is the sequester a laughing matter? >> i have to say they are becoming so. the scare stories come out and the time is here and the scares aren't coming out. >> the mark doesn't seem exercised, as brian was saying. should it be more as far as concern and growth with the sequester? >> i don't think so. the total amount is just 2.6% of

gdp. >> this year. >> this year. that's the issue, this year. that's, to me, not enough. plus part after long-term strategy to get spending down and undo the big binge we had recently. >> you add chart and the chart shows different paths. in the context you put it in as federal outlays, the sequester doesn't look like a whole hill of beans to quote this -- >> it is just miniscule. 4 or 5% run up and this is just.2 .6% down. >> the other line this is people won't know if it is a pr growth or reform line what does that mean? >> that's my line. spending before 2007. good thing about that line is you can balance the budget without increasing taxes. >> you also said something to me, one reason not to be concerned about the sequester is they can undo the worst part of it in continuing resolution. explain that. >> the continuing resolution at

the end of this year, the rest of the 2013 budget. they have to give instructiones to the appropriate committee. so they give instructions to undo percentage declan. >> another chart shows that federal spending, the debite is not about cutting spending, it is about slowing the increase. explain why that is an important difference. >> absolutely. many people think you can stop the growth of government but it is really letting government grow at a slower rate. don't have it grow so rapidly. just containing the growth. a big different compare to cutting. slower growth rating is not cutting. >> you said earlier today a key here is that you change the way we calculate social security spending. >> yes. right now, we are expected to

spend more for beneficiary in the circle. people retiring now will get more than people retired ten years ago. all we have to do is prevent increased amount for beneficiary and that will solve the growth of social security. >> john, one more question on monetary policy. janet said here today at this conference she see a cost right now that makes her think they should not continue with quantitative easing. do you think that janet young is too unconcerned about the cost. >> absolutely. the costs of how they will unwind this. concern of costs of how people make ends meet because interest rates are so low. the people don't want to lend so much when it is so low. plus unpredictability and the sooner the fed indicates it'll stop the massive purchases, get back it normal monetary policy, the better off it'll be.

>> thank you for joining us today. back to you, it is a real hoot here. >> looks like it. now to steve liesman. let's get a market flash from julia boorstin. what are you watching? >> netflix giving back dramatic gains. today trading back more than 5%. a consumer satisfaction indaeks reveals that netflix wasn't won back kust my satisfaction since raising prices in 2011. also impacting stock are worried about more competition from hulu. zynga is up 5% gaining on optimism it will cash on on on-line gambling. now zynga shares are up more than 50% so far this year. but there is still down more than 75%. when you look over the past 12 months. brian, over to you.

>> julia boorstin, thank you. now, what is the best commodity trade? we will find out. >> did you know there is a way to trade student loan debt? sounds like sub prime crisis all over again. but is it? we find out. hey, so i just switched my car insurance to state farm.

saved like $480 bucks. that's a lot of money. i know, right? wait...you have a car? yeah, an suv. [ male announcer ] switch and you could save $480 bucks with state farm. revolutionizing an industry can be a tough act to follow, but at xerox we've embraced a new role. working behind the scenes to provide companies with services... like helping hr departments manage benefits and pensions for over 11 million employees. reducing document costs by up to 30%... and processing $421 billion dollars in accounts payables each year.

helping thousands of companies simplify how work gets done. how's that for an encore? with xerox, you're ready for real business. how's that for an encore? try running four.ning a restaurant is hard, fortunately we've got ink. it gives us 5x the rewards on our internet, phone charges and cable, plus at office supply stores. rewards we put right back into our business. this is the only thing we've ever wanted to do and ink helps us do it. make your mark with ink from chase. (music throughout) why turbo?

trust us. it's just better to be in front. the sonata turbo. from hyundai. oil falling below 90 bucks for the first time this year. bertha coombs is out watching action. what going on? >> it is moving out of those net long positions. according to the latest commitment of traders report we did see a drop when it came to nymx crude at about 16%. today with that move below 09, looks like we are on pace to close at 2013 low.

also dragging down brent as well below 110 a barrel but the big sell-off in the oil patch is in gasoline which has outperformed both this year. gasoline today, biggest loser on percentage basis. strength in cash mark wet lots of can cold weather ahead this week. here on the east coast and midwest. another big storm barreling its way across the country. >> gold one of the most commonly traded commodities. phillip, what is your single best commodity trade right now? >> i still think the down side of the crude oil is one of your best trades. we saw crude oil break below the average at 9044. that a result of the u.s. oil boom and boom and technology we have seen. i anticipate crude oil prices

work their way down, 85, 84, somewhere in that region. we are producing highest levels since 1992. producing about 7.1 million barrels a day. we should average about 7.25. if you look at it next year, about 7.8. to put it in perspective, last year only producing about 6.6 million barrels per day. supplies are at 278 million. over 20% from last year. it makes the u.s. become more energy independent. less need ford opec. we've got nigerian inputs at 5.0. >> that's your idea, short crude. but what about bargain hunting, phillip? what about for example scraping around the bargain basement for maybe gold, down now for six months in a row. or coffee down about 40% from its highs. >> if you look at the gold market, seems they caught a flu.

you've got quantitative easing. we are buying about $85 billion in treasuries per month. what that is doing it typically the normal investor would think gold is doing spectacular but i think the sequester has problems on gold. you have the dollar index pumping up quite a bit. i think once the see quester is over you will scecsee a euphori. i think the market will tick down 7.8% on friday. i think if you are bargain hunting, wait a little bit. coffee, i think that is a really good opportunity right now. they've got a lot of talk about some fungus down in south america. what they are doing is actually removing a lot of crop right now. what had happened is farmers needed to raise cash. went to the binks and sold futures contracts. to prove they have shorted this

thing. and what that's done is put pressure on prices. i think once they need to replant they will see a small crunch happen with supply and i think demand will remain constant and prices will rebound. >> quickly, do you have a stop on your short oil call? >> i think over the 92.44, you know, or you know, if you start looking at something like 95, i think those are the levels. but i think a hundred is a far cry from where we are at right now. >> thank you very much, buddy. i do appreciate it. >> thank you. >> up next, guest and gambling addition. >> plus, google hitting another milestone. [ male announcer ] i've seen incredible things.

otherworldly things. but there are some things i've never seen before. this ge jet engine can understand 5,000 data samples per second. which is good for business. because planes use less fuel, spend less time on the ground and more time in the air. suddenly, faraway places don't seem so...far away. ♪

all three cs moving higher as we speak. not doing too badly with a come back. street talk, first of all, hess,

gas company. >> fire under this company is heating up. they are making lots of moves with the billionaire hedge fund elliott management. first, they rejected board members but hess said it'll exit its retail energy trade business. raising 40 cents and up to $4 billion. they want to primarily focus on becoming a company. >> noermg stock with a fight around it. >> and another one around around the new york times. las vegas sands disputing reports it likely violated a foreign act, aka, bribing foreign officials. they said our own internal audit found violating likely transactions. but they said, lvs particularly upset with the new york timesed

a line, says the casino likely cheated. >> not a good word to use if you are not sure. >> let's talk about yahoo! and please tell me this is not just about marissa mayer's story, please do not work from home any more. >> no. yahoo! said it. discontinue product like the mobile app for blackberry. though some discontinuations were announced a while back. >> what exactly are they, who are they, what do they do? >> the radian were in a list and the stock is up, and wow, really increased. stronger. look that, mandy. whole session long, right?

so you've got a lot of positive. radian raised capital last week. but be careful because radian stock doubled since mid november. >> we have stratuses. is that how you say it? >> i don't know. i've never heard of the company either. this is why we do street talk. a 3-d prining company. 1.4 billion merger with a company called object. they see revenue growth well ahead of expectations. this was a $20 stock. back in late 2001. off its $90 high. but look at the one-year return. >> i will take 91% over the course of a year. >> that's. >> 53 points on the dow from all time closing high. for the s&p, 49 points away from

that. as we speak, dow up by 16 point. not a bad turn around. >> and please, note, america that dow is negative all day until right when "street signs" began. then it shot positive. coincidence? of course. but we will take it. >> latching on to our opium. we are clutching at straws. now, google. >> we are following a couple stocks up there in price. google hitting an all time new high today so where will the goog go from here? it is fantastic for investors. why? about the same for the last year. what's powering this stock higher? >> well, so a couple of things. remember, this is a stock that for the last two or three years, it really hasn't done that much. the range was 550 to 650 and so

if you owned it for three years, you didn't really get paid all that much. what happened in the last few monthes, are a few things. one, the clearly show that nonsearch business continue to grow very, very fast. that's a display. they prove that the environment went in their favor. the u.s. has given them their blessing. they are still waiting for the eu to do the same thing. >> generally, guys like apple and facebook et cetera, have not really had much traction deviating or taking, you know, traffic from google and from search. and yet this is still a company that has grown 15 or 20% on a core business about ten years old and generating margin of 45% of 50%. that's what is going on. >> to play the devil's advocate here, when you say buy the stock already at an all-time high, it makes me nervous.

you don't want to to be the guy that says, i brought the stock to all-time high. like i pa bought it last september and look at it now. >> this is not an exact science, right? and that said, we were pounding the table on it way below 700. and we've increased our price target to 900 after the reported what was a very good quarter. we're not just raising estimates or the sake of raising estimate. what we are saying is 18 times pe which is more like 15 when you take out the cash, that's more in line with s&p 500. this is still a growth stock. so you know, at some point it is not going to be a, you know, table pounding buy. but again, at mid teens sign of pe, on 2014 and 2013 numbers,

that continues to be really, really good. you know, i think this is still an attractive buy here. >> real quick, motorola. still a show-me story. choppiness ahead? >> very much a show-me story. for now, you know, no growth kind of business. losing money. good news is there is no value in it in google shares. you know, the bad news is, if they do come out with the x phone and it flops then we go back to what you said earlier which is the stock probably will had sold before heading back north. for now, very much of a show-me story. >> thank you very much. well from a show-me story to drama in the show-me state, folks, seriously story here. here jet 45, will small private jet with reportedly landing gear or landing gear door issues. preparing for emergency door

issue at -- oh, it just landed. there is the plane on the ground. thankfully, folks, everybody is safe. there were eight people on board this here jet which originated in wooster, ohio. on its way it ft. worth. a lot of concern about landing gear but gets what, folks? looks like it worked. great news for everybody on board. great news for family. that's a good thing to see the plane safe and sound. on the ground. mandy, that will teach you a lesson. stop flying private. go commercial. much safer. >> i will take that on board. no pun intended. yet, up with a disconnect between what analysts do and what they say. he has three examplees. listen up, cramer. this one is right in your wheel house. >> going right after cramer on this one, isn't he? >> yeah. >> little cramer biff. >> it works for warren, why won't it work for you?

first, bill griffith, orkaflt "closing bell," what is coming up on your program? >> on the "closing bell," are we getting bipartisanship in washington? republican senator david vitter announcing why he is ending the too big to fail in the banking industry. a baby with hiv cured of the virus. can this be the seeming miracle in medical practice? at the top of the hour, we look forward to seeing you, maria and i do, for today's "closing bell." in the meantime, "street signs" is back right after this. combining your customized charts with leading-edge analysis tools from recognia so you can quickly spot key trends and possible entry and exit points. we like this idea so much that we've applied for a patent. i'm colin beck of fidelity investments.

our integrated technical analysis is one more innovative reason serious investors are choosing fidelity. now get 200 free trades when you open an account. ♪ for tapping into a wealth of experience. for access to one of the top wealth management firms in the country. for a team of financial professionals who provide customized solutions.

for all of your wealth management and retirement goals, discover how pnc wealth management can help you achieve. visit pnc.com/wealthsolutions to find out more. you name it...i've hooked it. but there's one... one that's always eluded me. thought i had it in the blizzard of '93. ha! never even came close. sometimes, i actually think it's mocking me. [ engine revs ] what?! quattro!!!!! ♪ check for more!

well, i guess i can double check... my watch! [ male announcer ] it pays to double check, with state farm. let's take a look at the market. 53 points away from the all time closing high on the dow. for the s&p, here is an interesting stat. s&p has not closed higher on a monday. so far this year today, might be the year that breaks that losing streak. it is currently in the black. as for what else we are watching, sequester, market doesn't care. sequester slowing down, market

doesn't care. all put on the back burner as we move higher. >> taking ved credit for that? >> sure, why not. >> taking credit for the water we drink as well. >> don't worry about wasting time on facebook. a study found that it boosts your memory. improving the memory of older adults by 25%. keeping track of statuses, baby photos and things your friends like that are probably completely garbage are better than a mental work out. study was done by a grad student at university of -- uh -- uh -- arizona. >> yeah, that's right. >> speaking ever older american webs herb is back and beggigger than ever. like what i tell my children, do as i say and not as i do. >> when have you it, you take a look at what the analyst are

saying and what they said during the season, i have to tell you, i see in disconnect on several of the names. take harley-davidson for example. wells fargo's lowest, 2013 guidance by 4%. but raises the stock price target by 4%. what would happen if they had lowered their guidance by 10%? would they raise -- these are the things that make no sense. >> unless they feel that based on evaluation trade. >> there are so many trades today. let's take a look at sale. jeffreys lowers earnings per share but keeps the target price in tact. wells fargo lowers eps but raises the target price. come on now. i see the look in your face. but when i take a broader look at the company, do an overview,

first thing i look at is that sales growth is slowing. it really is slowing. look at margins. lower than a year ago. take a look at the company and say, space is grow will. this have done a fabulous jobs that's how i would imagine the investor is feeling now. >> now, look, raymond james slashed us amid cuts of the karg et price. this is why this matters. today the company said it sales are below low expectations, since february. short term is a below, like media buying, and here's the deal. you've got something that doesn't smell right here. back in december they had another problem very similar it this. and my look, okay, is first off

i agree with you completely, about the analyst. but you've been doing this a long time also. you know it wouldn't be the first time that a company with a shrinking balance sheet somehow continues to never do well. i'm just trying to play advocate here. maybe companies where the margins are compressing or whatever it might be but yet the stock continues to go higher because it is something called momentum. the take. the trade. >> these guys don't want to be the first ones to pull the plug on that is the way i look at it, because by the way, you talk about momentum? what do i talk about often? that's momentum in reverse. so i like to call these analyst out. again when we talk about comfort, it shows you analysts had that disconnect a month ago or weeks ago. >> you should call it no-mentum. that's my word for you. there is a train box

outstanding and now 31% of people paying back loans are paying back at least 90 days late and those are the people that are paying back loans. however this is not stopping investors and trading plat forms from going all in. senior correspondent scott cullen is here with the story. >> remember, you us a have to pay back your student loan. you can can't get rid of it in bankruptcy. that's one of the issues here. but there is indeed a student loan backed securities. it is a relatively tiny market now about $30 billion year. mortgages around $30 trillion but on-line trading platform second market has just launched a platform specifically for student loan securities. matching the company's that issue private student loans with institutions looking for exposure to that class of assets. and there are descent yields or securities. now why under world is brian suggesting student loans with massive debt and delinquency

rates. the student loan market is a fraction of the size of the loan market. the new securitization is involved. private student loans with lower delinquency rates, and know you can't short these, at least not yet, because there is no way it borrow them and no such thing as synthetic student loan security. at second mark they are betting the security market will grow as student and parents take on more debt. they also think the current model where the government originates most student loans is not sustainable and they plan to be there when the private sector takes some of the borrowing back. >> i hear you. but for the fifth time in the last decade, a bill would allow people to discharge their student loans in bankruptcy like they would other debt.

probably won't pass. but the congressman fighting for that right auns went they do, that market a lot. >> the question is, will it pass? there are a lot of pop u lists, wall street crowd. this is one of the big things. >> it has to pass. as you and i know, this is one of the real big change chains on someone's back for a long time. >> i think if it does, they will address this. >> we will leave it there. thank you very much, scott. thank you very much, herb, as well. >> coming up, the warren buffett stock buffet. we will serve up stocks that berkshire is buying.

i can seat 2700 or 2800 calories a day. and it seems to work reasonably well. and if i'd eaten broccoli all my life i'd probably be in a mental institution. >> well, that was the oracle of himself with a little sense of hum humor. also on during his morning appearance on cnbc buffett

buffet of stocks. why don't we talk first of all about his stake in bank of america. let's listen to what he had to say about that. >> we had warrants that held for nine years. we're going to hold that. we expect bank of america in eight and a half years to be worth significantly more than it is now. i have no idea whether it's going to go up or down tomorrow or next week or next month or next year. but they are making progress and getting rid of a lot of things they shouldn't have been in. they're making progress in cleaning up mortgage problems in the past. most of which came from their acquisition of countrywide. and got a terrific cost deposit space. over time they will do well. >> is there an argument here by virtue of his investment in bank of america, he even safes this company? >> i think that is the argument. by virtue of buffett coming in

and essentially solving bank of america's short-term liquidity picture which is what everyone was worried about. if you remember in late 2011, there was talk about a putback settlement by buffett coming in and solving that, i don't know if that marked the bottom but maybe a few weeks later we saw the bottom in the stock. buffett just by him being involved changes the picture of what a stock is worth in everyone else's eyes. >> is this also basically being bullish on the housing and economy the fact he's in bank of america? >> yeah. i think bank of america certainly bet on the long-term strength of the u.s. economy. and also you've got to remember that these warrants were in addition to the preferred. so it was like a free call option on the stock. it stressed it was going to be a long-term investment. so his comments this morning i don't think were necessarily -- he didn't sound overly enthusiastic about the bank. but they're doing the right things as he said.

we may have dividends coming in in the future, dividend raises as the bad loans get further and further into the rearview mirror. >> josh, let's talk about the song turned down. this is the only that does not have a aaa firm. what do you make of d a ravita? it's interesting for him. >> here's the way to look at his stock picks. some of his portfolio are being picked by todd wexler. they're starting to break that out. that's one example of where he's kind of turning over a few become dollars to his new young turks. allowing these guys to do what they want. sometimes it looks similar, but sometimes it doesn't. i'd also point out that directv is an example where they both

like it enough it's a billion-plus position which puts it in buffett's top ten. i think now you can't just look at these things and say this is a buffett stock. there are some other cooks with a ladle in the soup. >> let's hear what he had to say about apple stock. >> apple's done a pretty good job of building value. they may have too much cash around. 2/3 of it hasn't been cashed yet. they don't want to bring it in because they don't want to pay the tax. >> he also has no holding in apple. what do you make of his comments? >> he shares the same concerns as most people. the competitive mode of apple doesn't seem as strong as it was a year ago. with all that cash it's more becoming a security representing cash. and if you look at analysts' growth forecasts over the next few years, it's sub-10% in the years going forward. so all that cash is really

weighing on how much the company is grow. >> guys wi, the one piece of ade he gave is look try to not pay attention to what all the other folks are say siing. it was never about what am i going to do with the cash? because shareholders knew the goal was to grow the value of the business and the stock price will follow. if tim cook follows his advice, that's what you expect going forward. >> and he also commented on jcpenney. it's in a tough situation and retailers don't want to argue with customers about what they want. gentlemen, thank you for joining us today. coming up next, how to harlem shake your way out of a job. with the spark cash card from capital one... boris earns unlimited rewards for his small business. can i get the smith contract, please? thank you. that's three new paper shredders. [ boris ] put 'em on my spark card. [ garth ] boris' small business earns 2% cash back

on every purchase every day. great businesses deserve unlimited rewards. read back the chicken's testimony, please. "buk, buk, bukka!" [ male announcer ] get the spark business card from capital one and earn unlimited rewards. choose 2% cash back or double miles on every purchase every day. told you i'd get half. what's in your wallet? told you i'd get half. but that doesn't mean i don't want to make money.stor. i love making money. i try to be smart with my investments. i also try to keep my costs down. what's your plan? ishares. low cost and tax efficient. find out why nine out of ten large professional investors choose ishares for their etfs. ishares by blackrock. call 1-800-ishares for a prospectus which includes investment objectives, risks, charges and expenses. read and consider it carefully before investing. risk includes possible loss of principal. [ male announcer ] this is karen and jeremiah. they don't know it yet, but they're gonna fall in love, get married, have a couple of kids, [ children laughing ] move to the country, and live a long, happy life together where they almost never fight about money.