isn't so bad. >> you're having a wonderful time over there. instead of talking about golf, we're talking about grilled cheese here, brian, because it is national grilled cheese day. it's also licorice day. we chose the one we like best. this is the sandwich i ate. and from grilled cheese to bacon-flavored cotton candy. brian, you are the first one to have a taste. dig in, sir. >> thank you. thanks for watching street signs, everybody. "closing bell" starts right now. happy friday, everybody. welcome to the "closing bell." i'm maria bartiromo at the new york stock exchange. this market fighting to make it a perfect five for five this week. doesn't look like it, david. >> not right now, at least. i'm david faber in for bill griffeth. coming up, it is the final hour of what's been t another very, very strong week for stocks. they've been in the green the first four days this week, but will we pull it out today and be positive on the dow? >> let's take a look at where we stand right here, with the dow jones industrial average down about 30 points on the session.

banks in the news today, big earnings from jpmorgan and wells fargo, as you know, out this morning. we've got the wells fargo cfo here exclusively as well as fdic chairman shelia bair. she still says too big to fail may be over. she's here exclusively to talk to us about that. >> and we'll have more of my exclusive interview with liberty made boss john malone. he tells us how ben bernanke's media policies are helping him build an even bigger empire. >> the dow jones industrial average, down 30 points, 14,835. last trade there pulling back from an all-time record high reached yesterday. nasdaq was down 11 .75 points. and the nasdaq also down. the dow on pace right now for the first down day of the week, but still, we're still up nearly 2% on the week. >> and what is keeping this market afloat? well, in today's "closing bell" exchange, dan greenhouse, cnbc

contributor from btig as well as hearth hughes from sun america funds, brandon, and our own rick santelli. we've got them all. dan greenhouse, let me start with you. you've been looking for a acquiescent bond market, you've been right on that. give me your take on this week. >> it's been a terrific week, there's no doubt about it. whatever hiccup has been thrown towards this market, it's brushed it aside. now, admittedly, we're running into some headwind here in the form of weakening data in the summer, and that's something we'll have to deal with over the next couple of weeks, but what we've seen thus far has been an extraordinary amount of strength from the equity market. >> so what's new here. i mean, brian gentry, what did we learn this week? we know that now there's this new debate going on within the federal reserve about when to ease up on the stimulus. is it going to be at the end of the year, is it going to be in 2014, or '15, or is it going to start at the beginning of the summer.

if you learn that that stimulus starts beginning and end in the beginning of the summer, are you going to be poised to sell stocks? >> maybe in the short-term. again, it might get a bit of a pullback. we're a little overdue for a pullback. i don't think anyone thinks that the stock market is going to roll up the way it has in the first quarter, in these few weeks, but by and large, no, i'm not as worried as others might be. because the fed has said that their data dependent. this is why the debate is going on. if they decide to basically stop qe2, it's going to be because they think the economy's strong enough to withstand it. in that case, it's hard for me to see that that's going to be bad for companies or bad for earnings. >> and heather, you know, we keep saying the money. one of the bullish arguments, of course, is, with those kinds of yields in the bond market, i've got to find something else for my money. have we seen a lot of that play out, in your opinion? >> it's interesting, siegel was on your program on wednesday, and he still mentioned that

dividend space. with the yields near zero, the ten-year still makes sense as a play for income, capital appreciation, and even as an inflation hedge. >> i'm sorry, go ahead. >> how do you invest, then, in that scenario, heather? >> it is interesting that year-to-date, we've seen leadership from consumer staples and consumer discretionary names. i've heard the term secular bull market more in the past month than i have in the past decade. secular meaning that there's a long-term sentiment shift among advisers. the cyclical names, perhaps the financials, tend to need positive macro economic data as well as a strong economy to thrive, and we just haven't seen that, based on retail sales this morning, and the jobs data last week. >> you know, dan, multiples are stretching. i know that they're still low versus a lot of historical comparisons, but we're in the midst of earnings season, it's

really just begin in earnest, let's call it, today with jpmorgan and wells. are we going to be asking a lot from corporate america here to maintain these valuation levels? >> i don't think so, because i don't valuations are particularly stretched on a four-quarter or trailing basis. what worries people like to me in a three to five to seven-year framework is a more cycle-adjusted pe ratio. that is certainly at elevated levels. but i don't think there's anything on a four-quarter forward or trailing basis that screams that the market is particularly overbought. if anything, it's fully valued. >> i actually agree with dan. it's interesting, since the beginning of the century, in early 2000, the s&p was trading at 1469. we breached those levels in january of this year. but the main difference in the past 13 years is that both earnings and dividends have doubled. as a result, we have seen the price-to-earnings multiple or that pe ratio come down from 30 to only 15. >> all right. so where are the most excessive valuations within the market? is that one reason that you think that tech has been selling

off, because valuations are higher there? because, overall, you're talking about, what, a 15 pe on the broader market, right? >> yes. so you're right, maria. and we're seeing corporate profits come in. they look okay, as far as earnings expectations, but that's only because the bar has been set very, very low. so there is weak guidance. when you have the bar set near zero, it's not too hard to beat those expectations. and the market seems completely decoupled from the macro economic data, because of corporate profits. >> i would like to ask the gang something, okay? you know, i hear how everybody, like dick bove just loves the financials, so when i looked at jpmorgan's first quarter earnings, in the context of how everybody loves housing, here's what i saw, that the mortgage originations sequentially were up 3%. and if you look at their pre-tax mortgage income, it was down 43%, year over year, the spreads are killing them. so what does our group think

about that? >> let me just jump in here real quick. rick's got the exact right observation, but i would just add, we really need to look at wells fargo. wells fargo is the snufflufgus. certainly, wells fargo, although they've been stepping back somewhat, is the whale in the room. >> what did you think of retail sales? >> let me just stay on wells fargo for a moment, because we have tim sloan coming up in a few minutes, the ceo of wells. what was the most striking part of that report, then, dan, that was your takeaway in terms of wells fargo in this mortgage reboot that we're seeing? >> the biggest problem for the mortgage market in general is that you pretty much run the course on refinancings. originations have been a problem for some time, for the sector as a whole. i mean, listen, i'm not going to front run tim sloan here. for only the second time ever, i'm probably going to agree with rick santelli on air, and say

that haigher interest rates fro that standpoint is probably not the worst idea in the world. >> hey, rick, let me just take it off our shores for a moment. you've been doing a lot of reporting and discussing of japan and the jgbs this week and the fall on the yen. give me some take of the volatility we're seeing in the nikkei, the yen and particularly the jgbs, and what it could mean particularly for this u.s. market on the bond and the stock side. >> i think it's a philosophical question more than anything. we just heard one of our guests early in the segment say, you know what, it depends on what ben does, what the committee thinks. you know what, it also depends on what the positions in very old markets like the jgb with their historic low yields. they've had days where they've had 30 welco, 40% of the entire ten-year yield change hands in one section, from 32 to 65 basis points. today they closed at 61 basis points. if that ten-year jgb gets much above 1%, many think it could

really put a big crimp, not only in the carry trade, but all the positions the carry trade has been put in or may be putting into as we speak. >> but that doesn't mean it ends anytime soon, right, rick? you've got a market here in japan that's -- >> there's so many people, so long, so many tough parties. david knows this. he's talked to some of his very smarter buddies about this, i just think if a market throws a hissy fit on the fixed income side of government securities in japan, i don't know, it would remind me of when they tried to intervene. when the market speaks larger in the intervention, that has sizable consequences. >> we'll leave it there. thanks, everybody. we'll see you soon. less than one hour away from trading the closing week. let's get to bob pisani. what's the bias in this final hour. what are you looking at? >> we were down 73 and we have a shot at ending positive. if we do, that would be one heck of an achievement, given some of

the pressures the market's been under today. take a look at the main theme, and the main discussion has been the weakness of the commodity and commodity stocks taking a hit today. we've got disappointing economic numbers again today, poor economic growth, some concerns floating out there. but remember, the s&p is still up 2.1% this week and barely down today. how about commodity etfs. we have seen immense volume today, maria. i mean mind boggling numbers. spider globe trust, 45 million shares, silver, energy materials, dbc, the commodity index, that's also had huge volume today. a lot of people are moving around some money right now. another weech group was technology stocks. i think i know why info down, that's hurt ibm and taking down some of the other tech names. but the overall market isn't that bad. we're still mostly negative. some of the defensive names, many are on the upside today. and more retail sales, we

certainly had it. that was a real disappointment today. but, heavens, look at some of the retailers, you wouldn't particularly know it. the market is still very resilient. maria, back to you. >> thank you. in the final stretch of trading for the week. about 50 minutes before the closing bell sounds. we've got a market lower, down 29 point ossen the dow jones industrial average. >> shares of wells fargo taking a hit today. up next, we'll dig into what's really going on at that enormous bank with its cfo, tim sloan. >> and shelia bair says too big to fail may be over. where is this coming from and is she right? we'll find out when the former fdic chairman join us exclusively later on "closing bell." >> and after the bell, we're going to go live to augusta, georgia, where the legendary masters tournament is taking place and find out just how big the tiger woods effect really is. he was down and out after the scandal. now he's the number one golfer in the world again. and you will find out why the folks who run the masters are very happy about that.

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two big banks are out with earnings this morning and many

more on deck for next week. >> kayla tausche back at cnbc headquarters crunching the numbers. >> wells fargo and jpmorgan this morning both beating on the bottom line, but they were having problems with revenue. jpmorgan's fell. wells fargo's number missed analysts' estimates. but with rates low but starting to rise, banks are having a tougher time making money. they're victim to the slowdown and the mortgage market, which has long been a source of heavy loan volume as consumers refinanced at low interest rates. the slowdown causing margins to narrow and in some cases, overall net interest income to fall too. that's hurting wells stock especially. jpmorgan saw sagging demand for consumer loans. the runaway winner there, though, asset management, with record net client inflows. the bank also getting a surprise boost in capital markets, with debt underwriting canceling out low m&a fees. revenues for wells fargo investment bank, jumping 37%, lifted by its involvement in the acquisition of heinz by warren buffett, who, i'm sorry swb a big wells shareholder. we have four more banks on deck next week. we'll get you all those numbers.

but for now, maria, back over to you. >> thanks so much, kayla. >> let's go right to the source on wells fargo's numbers. >> joining us right now, cfo tim sloan. he's also a member of the global cfo counsel. thanks for being here. thanks for joining us. >> great to be here. thanks for having me. >> you just heard kayla's report, and this has been a subject all day that the market has been looking at. mortgage banking revenues down 9% versus a target of down 5%. net interest margin disappointing and a tax rate, penny tax, also adding to the numbers. so would you characterize these numbers as low quality? how can you add to the critics in terms of what we've been talking about all day as far as the disappointment here for the quarter? >> yeah, fair comments, maria. i think it's hard for me to conclude or hard for us to conclude that these are low-quality earnings. we just generated $5.2 billion of earnings, which was the

highest earnings that we had in our history. and we've been in business for over 160 years. our earnings were up 22% year over year. earnings per share was up 23% year over year at 92 cents. that's our 13th consecutive quarter of earnings growth and our eighth consecutive quarter of record earnings. and notwithstanding the headwind that we had from mortgage orange nation revenues being down, we saw year over year loan growth, excuse me, of over $30 billion, deposit growth of over $50 billion, and when you look across the diversity of our business's wholesale banking, earning the highest amount in our history. deposit account fees being up 12%. retail brokerage being up 12%. investment banking up 37%. very, very strong from that perspective. and then our expenses were down. our expense efficiency ratio improved 180 basis points and credit was a really big story, reflecting the improvement in the economy, the improvement in

the housing market, as our loan losses were down 72 basis points, which was the lowest we've had since the second quarter of 2006. so we were very, very pleased with the quarter. >> and it's a great characterization there. you make a lot of positive comments. >> mr. sloan, getting back to that morning market, to the extent that investors have focused on that, given your large market share, are the best days behind us, in your opinion? >> no, i mean, we're going through a cycle in the mortgage business, and i want to make it clear that when you think about the mortgage business, we love it. all right? it is a great business at wells fargo. but in the first quarter, it was only 13% of our revenues. in fact, investment and management fees are a bigger part of our business. there's always a big focus on our mortgage business, because we are the largest mortgage originator. but we do not believe that the best days are necessarily behind us. we do think, as you pointed out in some of your comments, that origination volumes are coming down a bit, because of the fact that refinancing volumes are

coming down. but one of the exciting things about the complexion of the mortgage revenues and mortgage originations this quarter is the fact that instead of a quarter of our originations being from purchase money mortgages are one third. and purchase money mortgages are up 31% year over year. >> so what is your expectation in terms of loan growth? i mean, going forward, you're expecting, what, 1% loan growth per quarter. will you be able to achieve that? and why are we talking about such low numbers in terms of loan growth? what's going on out there, tim? >> well, the first thing, maria, is i don't think anybody should rush to judgment on loan growth in the industry, based upon the first quarter results. because the first quarter tends to be a seasonal low in terms of loan growth. clearly, there was an impact in terms of consumer and commercial decisions based upon the tax changes that occurred at the end of last year. but putting it all together, our core loan growth was up 8% year over year and our net loan growth was up 4% year over year.

and our expectations, we can't continue to grow loans and we can grow loans at a faster rate than the rest of the industry. >> what about expenses? you noted them. others have as well. your ability to control them was the key reason why the numbers were fairly good. but can you keep reducing expenses? >> i hope so. and i think we can. we put out an expense efficiency ratio range of between 55 and 59% a year ago at our investor day in may. and our goal is to continue to improve that efficiency. expense focus has got to be a portion of how you're running the company and it can't take away from revenue. so we want to grow revenues, but be able to deliver those revenues in a very efficient way. and we believe that over time, we can continue to reduce our expense efficiency ratio, as we did year over year. >> how do you address net interest margin? i mean, obviously, we know it's under pressure. how do you manage that in a persistently low-rate

environment? and i guess the next question would be, do you expect rates to start moving up this year or next? >> well, i don't know when rates are going to go up. i think what we need to be able to do and what we have been doing for the last three years is demonstrate to our shareholders that we can operate in a low-rate environment. maria, when you look at our net interest margin, it's declined 79 basis points in the last three years. three quarters of that is because we've had very good deposit growth. that's very good in terms of us growing our relationships with our customers, broadening those relationships, and being able to do more business with them. but there's no question that there continue to be pressure on the net interest margin in this environment, as everybody's balance sheet reprices. >> what about loan growth, as we head now into this second quarter of the year. things seem to slow. every year, the last three years, at this time of the year. what are you seeing out there? can you meet your targets of seeing some significant loan growth from the demand side of

the equation? >> well, i don't know if we'll be able to see significant loan growth in this economy, which is growing at somewhere around 2%, maybe a little bit higher than that. but we do think we can do is continue to grow at a multiple of what the industry is growing and last year, we grew at about 4% and we're hopeful to do the same thing again this year. >> tim, every report i've been looking at, whether it's wells or jpm or citi, it's more about the market and what's to come more than it is about the fundamentals and the ability the o grow earnings. what's your sense of how this plays out? it feels like too big to fail legislation is back on the front burner. a lot of people speculating that banks like yours are going to have to sell investment banking divisions, because of dodd/frank. and all of these local regulators all over the place as well. how are you going to deal with this changing landscape in regulation, and what is it going to cost you? what are you estimating? >> well, i don't know where regulation is going to go. what i do know is that we've

been a very heavily regulated company for our entire history. and we've been able to navigate the changes in the regulation that have occurred over the last few years, which have been pretty significant, and still report record and growing earnings. we've got a very good relationship with all of our regulators, there's always a lot of give and take, but there's nothing in dodd/frank, for example, that calls for the end of investment banking. in fact, we're not even through dodd/frank right now. so our view is that what we should do is, let's finish the regulatory path that we're on. let's see how the industry performs. we think that we can perform quite well. and it's not about size, it's about good risk-taking decisions. and we think we're pretty good at that at wells fargo. >> so the volcker rule, you don't think, sticks? >> no, i think the volcker rule will stick, but the volcker rule doesn't call for the end of the investment banking, it calls for changes in the investment banking business, most of which the industry's already made in advance, because we know what it

la looks like in general. there's a reduction in the amount of proprietary trading that folks can do, there's a change in equity investments. but for the most part, the industry's adjusted to a lot of those changes. >> tim, good to have you on the program. appreciate your time today. >> thanks very much. >> tim sloan is cfo at wells fargo. >> david, take a look at where we are with a decline of just about 19 points, well off of the lows as we approach the close. >> yep, clawing our way back on the dow, not as much the s&p, still down about 0.4%. after the break, microsoft shares not having their best week ever. is now the time to jump ship? two experts will duke it out after the break. >> and former fdic chair shelia bair says stop worrying so much about the banks. too big to fail might be a thing of the past. and then john malone telling me exclusively one of his regrets. >> marrying broadband with direct tv, we never would have given it up. >> you don't want to miss what

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welcome back. lots of buzz about microsoft this week. steve ballmer feeling some heat. jon fortt is in san jose breaking it all down for us. jon, we'll get to that in a moment. but first, you've got some breaking news on blackberry. >> that's right. an analyst out over the past couple of days with a report that blackberry return rates on the z10 were unusually high. just got a statement from verizon on this.

it says, quote, after the first 14 days, quality performance of the z10 has been in line with similar devices we've lunched, unquote. so not, you know, a ringing endorsement, but certainly knocks down the idea that the returns are unusually high among smartphones. now, on microsoft, i don't know if ballmer's feeling the heat, but his critics are certainly trying to crank it up for a number of reasons. first, overall pc sales down nearly 14% year over year, the worst ever. two, windows 8, windows phone, and surface hardware all struggling, to put it mildly. microsoft was downgraded this week in the midst of all of that. but the only who can really make ballmer feel heat, probably bill gates. a lot of credibility with investors is and ballmer himself holds about 4% of microsoft stock last time i checked, guys. back to you. >> thank you, jon. so what about buying microsoft

stock right now? let's talk numbers. on the technical side of the story, abigail doolittle is with the seaport group. on the fundamentals, jeff killberg is with kkm financial. good to see you both. abigail, how about those charts on microsoft? what are you looking at? >> the charts, maria, say that microsoft a near-term sell. when we look at the one-year daily, we see it's converging in a coil of uncertainty. neither the buyers or is sellers whether this thing is going to break to the is up side or the downside on bigger news. but what makes it bearish within what's crawled the symmetrical triangle right now, recent profit taking held at resistance. this puts the sellers in control, and this is likely to -- they're likely to push shares down towards the port, somewhere between 26 and 27. so i would take profits right here in microsoft. >> jeff, what do you think? did the fundamentals match the technicals? >> well, yeah, maria. it's hard to argue with abigail there. we saw punishing downgrade by goldman, which kicked off the 5% down move. but jon fortt was right.

this year over year decline in sales, it has a lot to do, actually, with microsoft. and i think the reason is, maria, is the windows 8. the touch-based operating system, they're trying to bring to market. no one wants to really use it, so they're adverse to buying that new pc. but the real reason i'm actually upset with microsoft is the surface. they came out with a tablet. they had a chance to go in there and fight with apple and google, and they absolutely blew it. they came out with overpriced tablet and it's not competing. right now microsoft has to rethink a lot. they have a stable balance sheet at 3.2% yield, but right now it is on its way down, i agree. >> wow. so the fundamentals and the technicals, right in step. thanks very much to you both. we appreciate and it we'll see you soon. >> thank you. >> okay, maria. >> all right. we've got about 30 minutes to go in the session. the dow still down about 21 points. the s&p, a bit more, about 6.5 points, at least percentage wise. >> have you heard this one? too big to fail is so over, so yesterday. that's what former fdic chairman shelia bair says. she joins us right after this

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welcome back. final check of trading for the week. the dow jones industrial average down about 20 points. we've just got 30 minutes before the "closing bell" sounds for the week. take a look at how we're shaping up headed into the close. we're off of the lows, nasdaq down 20, dow down. in her latest "fortune" magazine column, former fdic chairman shelia bair says it just might be. >> how? well, shelia bair joins us now with a first on cnbc interview to make her case. always nice to see you. shelia, make the case for me. first of all, let me simply understand how it is from your calculations in terms of the closing of a bank or the taking in of a bank would no longer result in too big to fail? >> well, it still would be a very challenging task. and i want to say at the outfront, i very much support

the current regulatory efforts to increase capital requirements, the volcker rule. i think we need all of that. but i do, yes, think that if a large financial institution fails now, that the fdic has the tools and a viable strategy for dealing with them. it would be messy, it would be challenging, but they could do it in a way that would not involve systemic disruptions and would not put taxpayers at risk. >> so, in other words, the dodd/frank legislation, i mean, how does that mandate for the fdic change the landscape? >> well, before the -- during the crisis, we only had the ability to resolve insured banks. so the larger financial organizations were not within the ability of the government to put into a bankruptcy-like process. so dodd/frank gave the ability to the fdic to resolve the entire financial conglomerate, not just the insured bank inside of it. so basically, what the fdic has said they will do is take control of the holding company of these very complex organizations, the holding company owns everything that's below it, and by taking control of the holding company and

continue to fund and keep operational the subsidiaries underneath, they can impose the losses on the shareholders and unsecured creditors at the holding company level, but keep the rest of the organization functioning, so you avoid the kind of credit disruptions that we saw, for instance, with the lehman bankruptcy. >> are you expecting spin-offs of investment banking divisions of the large banks? >> you mean now? >> yeah. >> or in a resolution process? >> going into, going into this process. going into this dodd/frank legislation taking effect. >> so, i think there's going to be more and more market pressure to do that. you know, maria, as you know, i have discussed before that the shareholder performance for these very large universal banks has not been good. and i think shareholders are increasingly realizing that the management inefficiencies you get from trying to manage these very large con glglomerates are trying to do commercial banking and consumer banking and all of that, it's just the efficiencies

aren't there. they're too hard to manage. so i do think over time, we're going to see more shareholder pressure to start breaking those business units up. and yes, i think separating investment banking from commercial banking is one obvious place to start. >> i'm sorry, i never fail to be amazed by the creativity, though, of bankse erbanksers. they seem to be shifting some of the risk and therefore enhancing their loan loss provisions or their reserves as a result to hedge funds of certain loans. i would love to get your take on that. >> you're right, there's a never-ending source of creativity and innovation to try to shift risks, to make it look like you're shifting risk, to boost your capital ratios, and sometimes that's real and sometimes that isn't. we saw with securitization it wasn't real. we thought that risk was moving up balance sheet and it wasn't. and this is why regulators really need to be on top of these things. you need to have a dynamic regulatory and supervisory

process that can monitor this and act on it very quickly. this particular example, i don't know. but, it just -- i am skeptical. a lot of these maneuvers to supposedly move risk off balance sheet. because as we saw with the crisis, is frequently still there, just not as visible. >> something else i would love to get your take on is fannie and freddie. they've been making an awful lot of money lately. and yet we have not seen a great deal of movement in figuring out what we're going to do with them. at this point, all the profits are being swept to the federal government or to the treasury. but where is that going to change, and how should it change if, in fact, congress eventually gets around to trying to do something here? >> well, i think there's a real risk that the more -- it doesn't surprise me they're profitable again. they're kind of working through their losses. they're the only game in town right now. they're virtual government monopolies. so it's probably not too hard to make money right now. but i would like to see the government get out of most of the housing space and let the

marked decide how much capital and investment we're going to allocate to housing. i support more of a traditional role of federal government support for veterans and first-time home buyers, but beyond that, let the market and people decide whether they want to own houses and let the market fund it. that's a personal view. i don't think that's what's going to happen in washington. the housing lobby is very powerful and people love their government subsidies. so, i expect things to bumble along for a while and we still have fannie and freddie and fha originating, and excuse me, guaranteeing almost a 90%, over 90% of new originations. >> so what's your sense of the regulatory environment and what it looks like in the coming couple of years here? what do you think is most plausible, that will actually take effect, and what not? because, you know, you've got all these regulators, local regulators, global regulators, lots of different rules in terms of capital, in terms of use of complex instruments, how do things change from your standpoint? what do you think?

>> well, i think, i am disappointed at the pace of dodd/frank implementation and kind of the confused, jumbled way it's gone about. and for all the complaining we hear about new regulations, most of them haven't even go into effect yet. a lot of them haven't even proposed yet. if i were the regulators, if i were still there, i would prioritize, giving capital levels up, better constraints, more effective, simpler constraints on leverage, and making sure we have a viable, robust resolution process, so the market understands that these large institutions get in trouble again, it's on their dime. the taxpayer is not there. that, by itself, is going to, i think, create pressure again for these large institutions to downsize, because their funding costs are going to go uphen bond holders, in particular, realize that they are at risk, not taxpayers anymore. those would be my two priorities, ending too big to fail, constraining leverage, and i really hope there are real proposals out there now, but they need to be strengthened and finalized. >> shelia, always nice to talk to you. thanks so much. >> thanks for having me. >> we'll see you soon. we've got 20 minutes before the

closing bell sounds for the day. we've got a market under pressure, but well off the lows, down just 17 points on the dow jones industrial average. and after four days of gains and big record setters all week, got to look at this as a victory. >> absolutely, especially since there was some disappoint with those numbers from wells and even j.p. mpmorgajpmorgan. up an next, john malone is soung off about debt, but not in the way you might think. >> and more details emerging in the bizarre insider trading case at kpmg. we'll take you live to one of the sites where the secrets were allegedly traded. and why the government seems to be going much harder after the leaker than the guy who made all the money. plus, how big of an impact is tiger woods having on augusta's bottom line? we'll take you live to the masters. join us for that. we'll find out why tiger's turnaround is making a lot of people a lot of money. back in a moment. a confident retirement. those dreams have taken a beating lately. but no way we're going to let them die. ♪ ameriprise advisors can help keep your dreams alive

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the gld is down almost 5%. >> and it's been plummeting, recently, gold. >> meanwhile, big interview right now. you just sat down exclusively with one of the biggest in the media business, john malone. tell us what he told you. >> so many different things that we've aired today and discussed, of course. malone may be known as a visionary when it comes to the media business, but what has already fueled his approach to investing is a focus on tax-advantaged assets and a mantra that says when the money is cheap, use it. tell me about your approach, given cheap money. where we are right now. >> one way to look at is, it's the present value of future cash flows, discounted by the borrowing rate. and so, things that are trading at seven or eight times post the synergies seem very cheap, if you can borrow money at 3%. so given the super cheap capital, these sustainable cash flow businesses just look very

attractive, to me, to be bought with leverage. >> you're comfortable levering up in this environment, i would assume, though, you know, where do you sort of draw the line? >> you wouldn't leverage a manufacturing company to the hilt, because it's too cyclical. >> right. >> maybe a two multiple would be max for that. but for a cable company with pretty good growth, going out the five. >> that's where charter is going to be, isn't it? >> a number of our entities, discovery, qvc just issued 30-year debt fixed in the under 5s. >> that's unbelievable. what's the credit rating? >> plus or minus "b." >> why wouldn't you issue it? >> you probably should.

>> there you have it. acquisition opportunities give you the ability to borrow and use cheap money and look for companies with huge net operating losses, tax loss carrier forwards, whether its sirius or charter or virgin media. >> a guy like that says something, you've got to pay attention. you've interviewed him so many times, but when he's talking about m&a, you know people are listening closely. >> i hope so. >> david, thanks. we've got about ten minutes before the closing bell sounds for the day. we've got a market lower, will we go positive in the next 11 minutes is the question? >> only 12 points to make up. >> we'll find out the day's best and worst performers. >> and later, more details being revealed about the kpmg insider trading case. we'll take you live to one of the california sites where the information exchanges allegedly went down. and we investigate why the actual insider trader seems to be getting off easier than the tipper. back, next. t be with fidelity, but we can still help you see your big picture.

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all right, welcome back. let's get a quick check on the markets right now. the dow jones industrial average down 14 points, nasdaq down five points, s&p 500 down 5.5 points. i want to point out one thing. i just talked to art cashen, looking around the floor, there is a buy imbalance to the tune

of $1 billion on the buy side. it is being led by the financials. they are buying the financials, headed into the close. i thought that was really interesting on the heels of those numbers that we got tonight. so this may very well change to the more positive in the next few minutes. many times it's a coin toss, because it could get pared by the close. >> with us is david darth from morgan stanley management. we've got gold collapsing and the s&p almost trying to eke out a gain over the dow. >> we're happy to see gold ease off. it was way ahead of itself. it's been up 12 years in a row. 17% compounded for 10 years. the gold easing off means that everything else is doing well. the market has acquitted itself well, as maria just said. you've got the buy and balance here, in spite of cyprus, in spite of the north korea rhetoric, the market is behaving very, very well. so, you don't want to sit there and laugh that your house is burning down, that you collect on your gold. the gold is an insurance policy.

and this week, maria, we got to say, bye to our friend, margaret thatcher. free markets, free people. >> let me ask you something about the free markets, by the way, because we got the bank earnings out today, okay. we know that overall earnings are only going to be up 1% for the first quarter. are you telling me to put new money to work right here, right now, ahead of all of those earnings coming out next week. >> maria, 1% earnings growth is baked into the market already. second half of the year, you're going to see earnings picking up. this is the low quarter for the year. so if the market does ease off here, you want to put money to work. and i don't like to surprise you, but, next wednesday -- >> you got another picture in there? holy cow! >> next wednesday is 24 years anniversary for cnbc. april 17th. >> i didn't want even know.

we've been here for most of them. >> got anything else in there? >> that is it. that is it. maria, that is it. thank you. profits are the key, and you've got lead indicators on thursday. housing starts next week. the philly fed on thursday. monday is the new york state empire manufacturing. you want to see how those are coming through. maria, you hit the key point, which is profits. listen, we've done very well with that japan-hedged equities. it's up 30%, maria, and when we started talking about, it was up 3%. it's up 30%. and we think it can keep going. >> that's a $7 billion fund right now. >> $7 billion found. health care, mexico, master limited partnerships. you want to own these kind of stocks and own these japanese-edged equities. this is where you want to be. >> you definitely want to be hedged when it comes to japan in terms of the currency. >> you look at one fund that's not hedged, up by 4% or something, the hedged ones are up by like 25%.

>> since november 1st, the japanese equity market is up 50% but the yen is down 25% against this november 1st. you want to be careful. the dollar being strong right here could be a headwind to earnings when you bring back the foreign currency earnings. so the dollar's been strong about 15% against the yen thus far, maria. it's up 7%, 8% against the british pound. it's up 1% -- >> what does it mean to me? make the point. >> what it means to you the foreign currency earnings that coback to the united states may be worth less and you may disappoint a little bit on that profits in the second half. >> thank you very much. have a good weekend. >> thank you. >> up next, we're coming right back with the closing countdown. >> and after the bell, we're going to take you live to the masters. wait until you hear how much the tournament's revenue depends on one player in particular. yes, that's tiger. back in a moment. [ driver ] today, my ambulance knew all about a bike accident,

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cook what you love, and save your money. joe doesn't know it yet, but he'll work his way up from busser to waiter to chef before opening a restaurant specializing in fish and game from the great northwest. he'll start investing early, he'll find some good people to help guide him, and he'll set money aside from his first day of work to his last, which isn't rocket science. it's just common sense. from td ameritrade. all right. let's take a look. the dow is trying to climb back here. i can't really see it, but i'm assuming that it is. >> down 16. >> thank you so much. so many different screens. >> exactly. we've got a market that's down 16 on the dow jones industrial average. 14,847. well, we had that $1 billion to buy going into the close, david. financials were leading that.

>> i mean, i haven't seen a quote on wells, but we talked to the cfo, a good quarter in many ways, but not what people had hoped for and still concern about the mortgage market. >> particularly with such a strong market. we're joined right now by matt cheslock at the end. what did you see at the close with so much interest. what do you think what's going on with this market coming all the way back. >> we'll justify this as a dip. i think that's probably what it is. you know, i'm not sure there's too much -- i'm not going to read a whole lot into this. if it is, it's going to be time to sell. i keep saying this over and over, but it seems like that's the way it is. this market is too resilient, though. it really is. i can't believe the way it's acted after jpmorgan and wells fargo. you know, the retail numbers that came out, the pc numbers that were out yesterday. the market is still just strong. >> why is it time to sell, then? >> it's just time to sell. you have to sell. you can't sell to sellers is the way the old theory goes. if there's multiple buyers, you have to pick your spots. >> so what you're saying is the fundamentals do not equate to

whatwe we're seeing in the stoc market. how do you explain the fed creating an environment where there just are no alternatives to stocks. >> well, you'll find the people who are saying this was an artificial creation by them. no one's going to fight the fed, but you can pick your stocks and your spots. >> i've got to jump. see you on monday. david, see you on the next hour, 4:00, closing bell. >> matt, as we wrap up, and see whether we can close positively, we are starting earnings season, but we've got some other things going on here. gold, we've been talking about a bit, that moved down. the commodities complex, overall, does that say anything to you? is it sending any sort of broader message? >> i guess gold manor came out and said, short gold the other day. don't want to fight them. look with the fed, don't want to fight goldman. i think there's a bit of throwing in the towel today. people don't want to catch this knife anymore. they've been cut too many times. that's the case with that. dollar's strong, gold's week. >> and setting up for next week? >> citigroup will be monday and a couple big