like that, what does it mean for the stock? >> some people are starting to say google android is going to be the future. >> i just dumped my android for an iphone. >> you think about the whole world. >> the united states, emerging markets and android's getting big. >> dan, stephanie, joe, thank you for the a wonderful joe. >> right now it's time for "squawk on the street." and we begin this morning with the dow above 15,000 for the first time ever. good morning, welcome to "squawk on the street." i'm carl quintanilla at the new york stock exchange. david is in las vegas at the sky bridge alternatives conference about thor known as salt where, david, very small minds are pondering just where the market goes from here. >> indeed they are, carl. we'll sit down with any number of hedge fund managers, both i will and through the day, as

well. our coverage at cnbc continues and not just on the equity side, but we'll talk fixed income, as well and such an important component of the portfolio and we want to hear about credit from managers that run hedge funds that aren't also about equities. >> you have great guests coming up, too, as david is in las vegas today. take a look at futures off of their highs and once again, pretty supportive macro data around the world. german industrial production, a beat, as well. take a look at europe. the dax, of course, is the first major european index to join the dow at those record highs. our road map begins with market history. the dow above 15,000 and economist muriel rube roubini warns a crash is coming. the last of the dow 32 report and mcdonald's saying the mcwraps is giving sales a boost in the united states. j.c. penney says sales are up in the pre-market and we will

explain why and cramer called a turn in the airlines months ago. should have been in them then. this morning delta announced it is initiating a dividend. is this a sign of strength for the whole sector? >> s&p at an all-time high, as well. both indices have surged more than 15% in just this year. a lot of statistics, jim, about the 20-some odd times the dow has crossed a thousand-point increment since it first hit 10k. usually the following week it's off a touch, but only about half of the time. is this a signal to get out? >> we're seeing numbers that statisticians haven't seen since 1958. the time to get out, one of the things that's really happened with this market is there are sectors that there are time to get out of and other sectors to get in. the financials have really come alive. that group is so cheap, how can i get people to get out of those? that isn't even near where it

was. how do you tell people to get out of those when -- when with it's eight and you go back to 2007. so i think there are certain segments and i had the ceo of clorox. kingsford was weak and the number was down 14% for charcoal so we should sell that. we still have no alternative to stocks. >> some of these names that never got any love, the fossils and the abercrombie & fitches and the genworth is that troublesome? >> yes. my daughter said how can abercrombie go up, the clothes are so crumby? the answer is we don't care about the clothes and we care about the stocks that haven't moved yet. weir not that particular. we don't care that textron disappointed. freeport didn't do well because it is so far behind, the other stocks, and i know, carl, it

seems fact wows, but it's the game that was played from 1980 to 1982 until 2 thousand thousand and it's just that people don't remember it. some of the highfliers will be on today. >> goldman takes it off the buy list and takes it back to a neutral and it's up 60 some odd percent since goldman added it to the buy list. you must have a screen of stocks that are now off. >> yes. >> let's use an example of the social media stocks, okay? i really liked linkedin right now, but i have to let that rest. when i look at what happened with zillo, i say trulia needs to rest. maybe realgy needs to rest, but toll brothers? they're still so darn cheap. i don't want to back away from this. >> mortgage apps up seven of the last eight months and more signs

in the apps today that show it's mortgaged dependence, and you talk about how private equity homes. i go back to wells fargo. look at that stock. it's where it was when this started and yet you have warren buffett, the greatest investor of our time that is still cheap. they own less than 10% of the mortgage market last time around. we do not have enough homes. there is a home shortage. we will get it if the realty largest broker in the country, most of the homebuilders say there is a home shortage. a million homes and maybe we have 1.5 million. how is this playing into salt in the short time you've had there? >> interestingly, carl, it comes back to the key component of every debate which is stocks versus bonds. why have we continued to see less, perhaps than you expect to be allocated to equities over

time and this idea that are we really going to keep running at the same kind of pace that we did in 1999. one has to wonder whether that's a bit of a concern, and we'll be talking about about all of those concern with the managers we find today. we didn't find too many last night who were willing to talk about the markets. they had a lot of things on their mind. >> david, one of the things that i find amazing. let's use a stock called whole foods. if you go back to the whole foods previous quarter, i know mr. rob who was the co-ceo was distressed because they didn't feel like they delivered in the top line and the gross margins. you know what? the stock goes to 81.82. what did they do there? the company readjusts. they have a couple of new products and they haven't scratched the surface. the stock is up $7 and the management recognize. they have to fix the problems and they do fix them fast as

we'll hear in a moment from disney when it comes to what to do with the movie division. david, these ceos are taking the bull by the horn and they're creating a bull market. >> when we talk about activism and boards that are a lot more active than they have been in the past you have to wonder whether that does play into that. and play into that willingness to take action more quickly than would have been the case in the past. >> you mentioned disney, the final dow component to report last night. they did thanks to strength in theme parks. >> mcdonald's reporting global same-store sales falling due to persistent economic weak business in the u.s. and china. sales in the u.s. did post a small improvement and iger on our air yesterday said the economy was steadily improving and the theme park attendance was up eight. >> was that extraordinary? >> cable revenue up nine.

in the times jessica reeve cohen said they're firing on all cylinders. >> i am not a nitpicker. one of the things i loved about this conference call is there's a sense, bob iger on the board of apple said i am not a hoarder of cash. apple loves a hoarder of cash until recently. what i like about disney is they distinguish themselves from other entertainment companies. i'd like david to address this. most of the entertainment companies are buying back stock, carl. you know what's happening, david? these guys have projects to spend on and the payoff is rather quick. >> yeah. that is true. you know, and the payoff is there. i am always amazed, jim, by the margins and the operating margins in the cable business and we can talk about theme parks which by the way, is a significant part of this company and i don't mean to dismiss it and people expect that will only continue to grow. it is amazing, espn. we'll talk about it all of the time and when you look at the

operating income number and look at the margins -- oh, my. >> there was a moment in the call when this was the super bullish moment of all. when bob iger said we're taking over 20 years the sec, and i'm thinking the securities and exchange commission, but he meant the southeast conference. >> he was on -- he was on our air last night and talked about the overall economy. here's what he had to say. >> when you have a steadily improving economy and that's clearly helped us, but we made some really big bets over $1 billion in california adventure in disneyland resort and new fantasyland in florida, three new cruise ships and two are open in hong kong and disneyland and those are all helping a lot. so there's just been great demand for all of our parks, both the new attractions and the new lands that we built and also for the experience that we provide. >> the operating income for parks and resorts were up 79% as well as some of the investments that david was mentioning.

>> mcdonald's down quickly, the comps were down .6 around the world. u.s. up .7. there was some point that they would be able to eke out a positive number, but as it turns out they're talking about doing more value in europe and looking at menu pricing further in some of the soft economies. >> europe is down more than 2%, carl. i' i'll put this one right in your bread basket and i think the u.s. was positive and tell me whether those in the pipe are going to roll out worldwide and tell me if you should be a buyer. >> each market is its own market, but your point about the u.s. is absolutely true. a lot of credit being given to the premium mcwraps which is something that we are just now beginning to see. very heavy marketing push and these comps will get ease jer. it was in april of last year where things really started to soften. so the bulls on mcdonald's would say the rest of the year was easier.

>> great points that you raise about comps being easier across the board and there were companies when you get to the second half that were not doing that well that will annualize easy numbers and people at home will say this is slight of hand and mcdonald's will have a great second half because of mr. thompson's tremendous initiatives to make the menu more exciting. disney, you want to go to the theme park because they've changed. mcdonald's go back because now you have an egg mcmuffin that is all egg white. innovation, innovation, innovation. howard schulze at the end of the day. they've got a wine now that makes two buck chuck which is the trader joe's wine. >> oh, yeah. >> i think this is a better wine that whole foods has. i know this sounds silly, but companies innovating are winning. winning. >> the comps on whole foods at least for the quarter today, nine, looks a lot. we haven't seen that in a while. >> i went to the kiwanis canal

in brooklyn to take a look at the gigantic footprint for the brand new whole foods in brooklyn and i went to the brookline whole foods because they bought foodmaster. they say they're making room for 1,000. they have room for 1500, and i think they're low balling and i congratulate emfrom endous management there for doing a good job. >> wfm. speaking of easier comps, j.c. penney forecast a more than 16% drop in same-store sales compared to a year ago. revenues were shy of analyst estimates and they did report cash levels that are higher than analysts had expected and this is no longer a cash death watch and as one analyst said this quart seer irt serer i on ron j time. there's also a subtle, not seen by people at home subtext. >> mike goldman is a well-liked

man and this is not the death of a salesman. well liked plays a role and one of the things people have to recognize is that we're rooting for ollman. he was tossed out and what's your hurry? >> people want to root for ullman, it does matter. this money and this quarter buys them time and he will get there for christmas. >> with all of that in mind, warren buffett was asked about penny earlier in the week by becky when he was on squawk and had interesting insight into the challenges. here's buffett. >> i worked for jc penney for a considerable period. i have a rooting interest. i don't have a financial interest, and i would like to see j.c. penney succeed. >> you would like to see them succeed. do you think they're going to? >> i think it's very tough. they obviously alienated a significant part of their customer base in the last 18 months or whatever it's been and retailing, it's a tough game. >> certainly, jim, the short

interest on his name, as you know, has gone back up. i know, but the prefer's been doing well and that's a better tell of how the company is doing. i want to correct myself. they make it to christmas and christmas has to be good and the fact the retailers never make it to christmas. my mom worked at lcht brothers, and my dad sold gabardines. >> great point. >> jim, can you hear me out here? >> david, you sound better than ever. making it to christmas, though, the comps will be so easy for them they're still going to be down 25% even if they're flat. in other words, the rate of annual revenues is going to be extraordinarily low. we know the balance sheet issue, perhaps are off the table now and we've known that for a couple of weeks and they signed up the goldman loan and now we get this in terms of the cash position. all reit, 16.6 and now you get the easy comps and they're still not going to be going up. >> no. they may not make it.

they may not make it and if macy's decided to put them out of business in predator pricing they could do it. >> there you go. >> all right. david, i look forward to more out there. when we come back, delta air lines returning $1 billion to investors for the first time in more than a decade. richard anderson, the ceo will join us first. >> great interview! >> zillo ceo spencer rascoff gives us a look at his results. we'll see how we hold up as we're above 15,000 with more to spare yesterday. a lot more "squawk on the street" live from post 9 in just a moment. ders using technical analysis streamline their process? at fidelity, we do it by merging two tools into one. 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. [ agent smith ] i've found software that intrigues me. it appears it's an agent of good. ♪ [ agent smith ] ge software connects patients to nurses to the right machines while dramatically reducing waiting time. [ telephone ringing ] now a waiting room is just a room. [ static warbles ]

big news out of delta today. the airline plans to repurchase shares to restart the dividend returning $1 billion to investors over the next three years. it's the first time in more than a decade they've been able to return cash to investors and even the idea of an airline doing this is like something out of the past. >> get used to it, airlines, three things they have going for them and one, it's impossible to get a new plane if you want a start-up against them. >> three, they have fuel-efficient planes and the mergers, try, try, try to pit

airlines against each other. it doesn't work. one raises fees. they all raise fees. we have a justice department that is a shareholder's dream. i always love it when the justice department blesses anticompetitive situations because then we all make so much money. the airlines are fabulous to invest in. >> big piece in the papers about how some of these capacity stripouts are beginning to affect local economies and certainly for the share price as jim said ends up being net positive. >> indeed. carl, this is an important moment. this is a moment that some shareholders who at least have been viewing airlines as investments rather than trades and let's call it for the last six months to a year have been waiting for. it is a significant advancement and i would argue for that argument that says you can invest in airlines and the return of capital for the first time in i don't know how long, a very, very long time, and so i think it is a significant one and i'm looking forward to the interview, as well with the ceo of delta. >> david, there are some people

who say it's the first time, that if you add up the sum of all of the capital that's been done of this industry, it's negative. you have to go back to lindberg when it looked this good. that's when they were making money. >> right. they always find a way to screw it up. no doubt about that, whether it was adding capacity and cutting price. in this case we have free cash flow generation which seems hard to imagine and perhaps these things are on the right course for some time, we'll see, it's hard to believe it and never having earned their cost of capital for most of the years they were in business. >> remember, you can't get planes. why is boeing upward despite the fact that the dreamliner has been tough. you can't get planes. if you and i wanted to do a start-up david, let's call it the david faber cramer airline. we can't compete. you go to dallas, you go to houston and you go to chicago,

get used to paying to walk down the plank. you are paying now to be able to get in line. >> like the idea you put my name first on the airline. >> it is charging you now to call and complain. the 800 number is now a number that you will pay to call. >> i'm going to new orleans. i'm done with flying first class. and no food in first class anymore. i paid for a drink the other day! >> just like you do at a restaurant? >> isn't that funny? >> no, twice. maybe at a danny meyer restaurant. i can't believe it. plus, it was bad scotch, david. it was like -- >> i'm sorry. our airline will be much better. much better. >> it will. >> the market's hitting record territory after the record high this week. how should you set yourself up for today? cramer's mad dash is coming up next. futures are showing softness here as is europe. a lot more "squawk on the street" from the nyse in just a moment. [ male announcer ] here's a word you should keep in mind. unbiased.

some brokerage firms are. but way too many aren't. why? because selling their funds makes them more money. which makes you wonder -- isn't that a conflict? search "proprietary mutual funds." yikes! then go to e-trade. we've got over 8,000 mutual funds, and not one of them has our name on it. we're in the business of finding the right investments for you. e-trade. less for us. more for you. the fund's prospectus contains its investment objectives, risks, charges, expenses, and other important information and should be read and considered carefully before investing. for a current prospectus, visit etrade.com/mutualfunds. before investing. all stations come over to mithis is for real this time. step seven point two one two. verify and lock. command is locked. five seconds. three, two, one.

standing by for capture. the most innovative software on the planet... dragon is captured. is connecting today's leading companies to places beyond it. siemens. answers. since aflac is helping with his expenses while he can't work, he can focus on his recovery. he doesn't have to worry so much about his mortgage, groceries, or even gas bills. kick! kick... feel it! feel it! feel it! nice work! ♪ you got it! you got it! yes! aflac's gonna help take care of his expenses. and us...we're gonna get him back in fighting shape. ♪ [ male announcer ] see what's happening behind the scenes at ducktherapy.com.

time for "the mad dash" with jim. talking about a company that looked like growth, is slowing until management decided to do something about it. >> whole foods was a darling and it generates a lot of cash and they always talk about a multiple-year plan and people fell about here that maybe kroger is starting to kill them. this was the t.j. moment.

this is when people felt trader joes was coming into them. you know what? all of that turned out to be a misery and one of the things i really liked about this quarter, carl is they are talking about doing far more stores in certain areas like boston which is why you can raise the thousand target and there was something else last night. we are trying to get retail investors in. they did a two-for-one split. totally frakt wows and you don't get more value, but more companies need to do this. mr. math and you mr. rob, they understand that they want retail investors and retail investors don't have to think about it. one thing apple didn't want to do, they didn't split. forget about buffett! be whole foods. >> that's a good point as we try to get mom and pop back in the market. >> is it going to be another record day on the street? we'll find out when the opening bell rings in four and a half minutes. don't go away. [ driver ] today, my ambulance knew all about a bike accident,

just by talking to a helmet. it grabbed the patient's record before we even picked him up. it found out the doctor we needed was at st. anne's. wiggle your toes. and it got his okay on treatment from miles away. it even pulled strings with the stoplights. my ambulance talks with smoke alarms and pilots and stadiums. but, of course, it's a good listener too. [ female announcer ] today cisco is connecting the internet of everything. so everything works like never before. [ female announcer ] today cisco is connecting the internet of everything. the math of retirement is different today.ek. money has to last longer. i don't want to pour over pie charts all day. i want to travel, and i want the income to do it. ishares incomes etfs. low cost and diversified. 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. bob will retire when he's 153, which would be fine if bob were a vampire. but he's not. ♪ he's an architect with two kids and a mortgage. luckily, he found someone who gave him a fresh perspective on his portfolio. and with some planning and effort, hopefully bob can retire at a more appropriate age. it's not rocket science. it's just common sense. from td ameritrade. >> you're watching cnbc's "squawk on the street" live from the financial capital of the world.

the opening bell is set to ring in a minute's time on this wednesday when the dow is still above 15,000 for the first time. the german dax joining it in that territory, as well. the journal, a lot of the newspapers try to put this run-up in perspective today, jim, and the journal calls it a sign of investors finding the market increasingly irresistible which is an interesting way to put it because there is a sense that they want to resist it, but few places still left to go other than equities. >> dr. p pepper on "mad money" had a 3% yield and i find that irresistible not just because i love diet dr pepper. no offense because i like diet mountain dew. these are companies that are doing so well with things being bad. who knows what happens if things get better? >> we might hear some sound from that interview, a little bit later on, but in the meantime as we get red for the opening bell and take a look at the s&p 500 at the top of your screen.

the cnbc realtime exchange. >> down here at the big board, the sle lupus foundation in recognition of lupus foundation and norwegian cruise lines celebrating the debut of its newest ship of the breakaway and our own simon hobbs spent the day on that boat yesterday and we'll see some of that video later on. >> we have two of our friends out there lupus, one of the security people up there ringing the bell, terrible disease. can't lose sight of the fact that when people ring the bell for a cause we should do what we can to help these causes. just to focus on the market, this is typical of what we get. the market opens choppy, okay? what do people do? they say look at that. i can go buy caterpillar and gm down 55, oh, man, they're opening a new cadillac plant? get me some gm. i once went to a dog track in

monticel monticello, florida. the mechanical dropped and the dogs went nuts and they all got a piece of the mechanical rabbit and the dogs are going nuts! >> you mentioned this rotation and the financials have done so well. someone said you know why financials are doing well? it's a way to make that the rotation without committing to a hard core industrial like a caterpillar. >> i like that. last night -- i slept like nothing last night and some china data comes out and 40 people tell me that china data is phony. those who think that china data is phony, then go buy some first horizon corp and i've been back and forth and the stock that my charitable stock owns and the bank performers and fabulous record earnings and they by the way, at then of the journal

article says dimon will win. what has the stock done in the last five years? absolutely nothing. it's like war, what is it good for? i believe these stocks are so darn cheap that you're right. you can hide in them. you don't have to worry about them disappointing because they've disappointed so much. if net interest margins go up, what a win. their franchises are good and we know that they're connected to mortgages. what's not to like? >> you've seen some of these names and wendy's, of course, one of the big losers. i wonder after their results and we have mcdonald's same-store sales, as well. >> we have so many of the restaurant companies -- >> yesterday i saw chipotle going down and i want to stick my neck out. i think some of them will benefit from a tailwind of lower ingredient costs. whole foods talked about that, by the way. the cost of food is going down so you may have been on the inflation side. wendy's, i don't know.

that's a competitive mark, but look at darden. they disappointed at this point and they disappointed higher. jack-in-the-box is doing well. popeye's which is asce doing incredibly well. i like the restaurant business. >> we mentioned jcp earlier in the show. that's the second biggest gain or the s&p. >> it will be -- it's not an immediate survival story. it's a back to school story and a holiday story. >> it's a reprieve and they did have the low prices and they're couponing and now it's super low. when i get my coupons from bed, bath & beyond. coupons are something people love in this country so they can generate a lot of cash, but in the end is christmas going to be good? and that is up to terry lundgren who i said can ruin -- they can ruin jc penney. >> david, it will be an interesting salt conference and what a week to have it as we're at these levels asking all these questions.

>> indeed. indeed. we'll be talking later today with peter schoenfeld and new york capital, an enormous hedge fund, by the way. you have to wonder where these guys are. i remember interestingly, having been here, i think it was three years ago, carl and sitting with some of those same managers who overseeing very large portfolios and it was all about risk off and it was all about europe suddenly coming into the picture in a way that we had not yet seen it. remember, this is three years ago when we started to see that spoon. that was this time of year. it is interesting. we're not hearing any of those concerns right now as we reach new highs on the broader averages, not the nasdaq, excuse me, but on the s&p and the dow and yet, it is still there and it is still a problem, not to mention some geopolitical worries in the mideast, i might add. >> yeah. syria continues to be something that the bears bring up. portugal is coming to the debt markets for the first time, jim. >> yeah. ireland came back and some of

the irish banks are coming back to life. i don't want to rule out, by the way. i think world bank of scotland is the most undervalued bank. deutsche bank has been on fire. ubs. bbba has aren't happened yet and when that does happen that stock will break 12. i did not mention banco santander because it has management turnover that i'm not crazy about. >> you mentioned the macro data out of germany. industrial production up 1.2. the factory orders yesterday were also a beat. would you say europe has turned? have we had this discussion? >> the vgk? david knows i've been controversial about the europe turning and the vgk, the vanguard international fund seems like a good way to be able to play it. yes, it's turned. yes because austerity is over. the rule of austerity is ended and growth will come back and david, that means we can take the cat strofk situation off the table and instead look at stock yields versus bond yields and the stocks are yielding very

well and the bond yields are not that great. >> well, jim, listen. the call is an interesting one and you've been right so far. there are many who would disagree and believe that we've got yet another chapter, if not, an entire book to come yet over what will occur in europe, but that being said, one hopes you are right. one hopes you're right and so far so good. austerity is out and they'll not be able to balance their budget. >> in the meantime, holy cow, is that gorgeous? people still want to be in master works which they know actually preserve their value, so those are really nuts about inflation. go buy yourself a cezanne. that looks really good. >> maybe you can go with some of your pocket change. >> yeah. i am in the market for that as you guys know. >> you can get one at martin lords. >> let's get to pisani who is here on the floor watching what's moving today.

bob? >> gee, we're down. i'm shocked. somebody must have hit the wrong button. stocks go up, right? we were down two points on the futures and we are 30 now. the stock market is doing fairly well and there were interesting data points, china's surplus was -- and there were disputes about the accuracy of the number here and important thing elsewhere is we're seeing very good numbers from rio tinto and they had positive comments from iron ore and that's been weak recently and they said they will rise for a 3% rate, and they should hit a record number of sales and that was a surprise to a lot of people that were expecting overall weakness. we saw german industrial production better than expected. we saw greek stocks at a 52-week high and some hopes that there may be more efforts of debt relief over in greece and look at commodities. copper is up again, over 2%. copper is up almost 10% last month, just in the last few days and there's a copper rally going

and that's encouraging. elsewhere here in the united states. did you see starwood property trust. they just raised the dividend. raised the dividend? they have a 6.6% yield, do you think they need to keep raising it? they said we have a compelling risk reward for our company. that's what we're all about getting you guys yield. there you go upon. that's the story. i know, jim, you mentioned whole foods. remember tyson on monday mention we've seen a lot of customers trading down to cheaper chicken over beef and pork. in whole food you see the exact opposite. they have 7 million customers coming into the store, terrific earnings and they said we are continuing to make market share from people. so you have the customer on the other end that's trading to the upside and companies like whole foods, and i was very pleased to see toyota motor.

here's what you didn't see. you saw very good earnings and the weak yen helping them. what i don't see is more jobs reported from the company, there were none and higher wages. as far as i could see, there were no wage increases that reported and you can say it's a little early, but this whole game of pumping money to lower the yen and to make money more profitable is supposed to move through to the workers in the form of higher wages and more jobs. so far with toyota, we haven't seen it. if this goes down for a few more quarters and something happens on that front, mr. abe will be, let's say, embarrassed. they need higher corporate profits. j.c. penney, why is it trading up each though they gave down beat guidance. this is a turnaround story and they secured financing and the return to discounting will bring the customers back in. j.c. penney trading to the upside. guys, back to you. >> thank you so much.

the crosscurrents here are incredible. we still don't have the revenue growth, but boy, what happens if we do is the way i look at it? what happens with if we get revenue growth? let's shift to the bonds and the dollar, rick santelli at the cme group in chicago. go ahead, rick. >> yesterday it was about germany's data and today it was about factory orders and today it was industrial production and both those numbers were better than expected and are painting a bit of a different picture than areas like auto registrations and remember, auto registrations is the focus of consumer demand directly. the rest of these numbers, as important as they are, it really is about will that demand be there, will we create inventory and we've also had a lot of comments this morning out of ecb official marsh and it's hard to interpret and they can do more even though the closer you get to zero in terms of rates has less and less of an effect and

all of that did affect the marks and the yield is going doin as we hit the time zone and no different and they're coming off of especially low 80s. if you look at the dollar index today, it is not faring well. we are not only failing at 83 and 82 and we're in the 81 handle and the next chart, this is the euro versus the dollar and it's counterintuitive in many ways and to think that the ecb potentially considers alternatives to ramp up their help for europe, but it is moving higher. the two-day chart, yesterday more swings than misses around 99.5, and you can see the toll it's taking on the market and the dow indeed now slipping a handle against the yen. >> jim, back to you. >> thank you, rick. let's check out the energy and metals. it's courtney reagan. >> if you take a look at what's

going on with brent crude trending lower. we have demandz still muted over there, but when we look at wti, slightly higher, hovering around the $96 a barrel level as traders are weighing the import news out of china against the expectations for the inventories which we'll get in about an hour's time. china's crude imports are higher in april and that reverses two months of decline. a bullish sign, we know, for demand, but what we're expecting out of those inventories is a build of 1.9 million barrels for crude oil. if we take a look at metals, what we're seeing for the china import demand for copper, the opposite of what we saw for crude lower in april, actually down 21%, the lowest since june 2011. as a result, copper is the best-performing metal so far this morning. carl, back to you. >> courtney, thank you very much. >> i want you to check out this tweet we just got from jack welch supporting jamie dimon's dual role as chairman and ceo of

j.p. morgan. jamie dimon's results during crisis and beyond earned him both chairman and ceo titles. great leader. >> i watched jack. let's go over some numbers. three-year records and 2012 for jamie. record earnings, 2013. top of m & a and investment banking leaves is this who we want not to be chairman. is that it? is lee raymond not a lead director? >> there are so many companies that are doing badly? is this the target? how about the fact that you groomed everybody involved with the whale? i don't think so. this is a farce. >> the front page of the f.t. saying they're pointing to a lack of proportionality between that move and the trading losses as bad as they were, calling it insulting, morale-zapping, not in line with what happened at the ceo office. >> my charitable trust owns j.p.

morgan, full disclosure. when this thing happened in the mid-'40s, i could haven't been harder against him. people change. people say, listen, i screwed up. i like the fact that dimon took this head-on. lee raymond is the lead director and he's the real lead director. i don't understand. i think people don't like jamie because he came through this thing with great, flying colors and now this is the revenge of people saying you know what? you're not so perfect after all? i don't know, i like the stock. >> there's the other more complex issue and if you were to separate it, very difficult to do once that person has had both roles. suddenly to not have it it is a messy management structure. >> they have a real board, if the board thinks they should split it, i trust the board. this is not a board of hacks and this is a bunch of people who are at the top of the game. if they think it ought to be split i'm all for it, but it has to be the board.

>> we still have a few weeks before the meeting in tampa. when we come back one of the biggest soda and snack companies join the fight against obesity. later, financials, as jim said, turning out to be one of the biggest outperformers this month and which are the best for your money? we'll show you how to invest in some banks. as we head to break, take a look at the early movers with the dow down 27. ♪ ♪ the new blackberry z10 with blackberry hub and flick typing.

built to keep you moving. see it in action at blackberry.com/z10 ♪

[ agent smith ] i've found software that intrigues me. it appears it's an agent of good. ♪ [ agent smith ] ge software connects patients to nurses to the right machines while dramatically reducing waiting time. [ telephone ringing ] now a waiting room is just a room.

[ static warbles ] coca-cola announcing new efforts in the anti-obesity campaign saying it will offer low-calorie drinks in every market and nutrition information on the front of every package. we'll be speaking with the head of north america coming up in the show. jim spoke with the ceo of dr pepper snapple about obesity issues on "mad money." >> our mayor in new york city,

mayor bloomberg, regards these as public enemy number one. >> we won in the courts i sent some tens. >> you sent him? >> we want to be part of the solution for obesity, but don't start banning things and telling people what to drink. >> 76 cases and bloomberg didn't respond. just didn't thank him. i don't always believe in the mayor, but i always say thank you. these drink, i know they are not great for you, but there is a freedom of choice. you don't have to drink rc 10. you can drink motts or apple juice and dr pepper is based on that. >> i wonder the combination of what he's doing and plus what kent announces today and what we'll hear more about at the top of the 11:00, if that take away some of the perceived headwinds for beverage makers. it was addressed right up top on the conference call.

dr pepper saying one of the things we're being hurt by is cold weather and the other thing is chatter. the ceo of pepsico has also dealt with this issue. you know what? people like certain things, okay? should the government ban them? i don't know. why don't they take off cigarettes before they ban the soda? >> coke is still outperforming the overall index, the 17% so far this year, pepsi, 22. these are great companies. i know you could -- dr pepper is the enemy if you're mayor bloomberg because he is trying to get kids to not drink this stuff and kids do make wrong choices, but at the same time dr pepper is trying to offer ten cal. i also look at the salt content which is not great. >> we talked earlier in the week about pepsi's run for a defensive play with good yield and it would not be at the top of the shopping list. >> i didn't think that quarter was that good and clorox is down five points and this group

rests, right? this group rests, but the prosecution can't rest because at the same time i have to take money out of that somewhere. pepsico can take a big move and consolidate. anybody remembers that 85 run with merck passed general motors and 86 run and they did a three-for-one. these thing goes on farther than people realize and they have to rest and other stocks take up the void and then they go back to them. >> that's a good, historical reminder. when we come back as the pentagon accuses china of trying to hack defense networks. we'll talk to one of the leaders of cyber security, the ceo of semantic wiis ima imantec will join us later on. coming up, we love numbers and so does cramer. "six stocks in 60 seconds" is up next. [ male announcer ] you are a business pro.

omnipotent of opportunity. you know how to mix business... with business. and you...rent from national. because only national lets you choose any car in the aisle. and go. you can even take a full-size or above. and still pay the mid-size price. i could get used to this. [ male announcer ] yes, you could business pro. yes, you could. go national. go like a pro. how we get there is not. we're americans. we work. we plan.

ameriprise advisors can help you like they've helped millions of others. to help you retire your way, with confidence. ♪ that's what ameriprise financial does. that's what they can do with you. let's get to work. ameriprise financial. more within reach.

time for "six in 60." six stocks in 60 seconds.

start with trip adviser. >> aol down, zillo is down. the group is consolidating and it's run too much. web md results. >> here's an example of an internet company that hasn't run and there's a rotation out of webs that haven't done and out it it went into ones that haven't done. >> sterling coverage of travelers. >> now they say outperform? this has been one of the monster stocks in the dow. it goes higher. >> more valuation questions on yahoo. >> i think that -- is this marisa meyer? has she done anything wrong yet? i don't think so. microsoft, you got too good a deal and i don't think she'll find a way to make that deal better. >> icahn's herbalife stake. icahn, when is the guy going to quit? maybe here. >> you've still got some room to go. eog. this just took out its all-team high here. rbc says that -- that mark papa

is underpromising. they have an oil revolution. they have found prudhoe bay in the eagleford and they have a new one in the delaware basin that no one is talking about. >> jim, we might have new mom and pops watching today because they're beginning to hear the market is setting record levels. usa today has a graphically, a thermometer like a united way board, that more gains are impossible and that it's bound to explode. >> let's take the case of bank of america. this wrecked a lot of portfoliois and think bank of america was the preferred way to play the group. it keeps getting better and i mentioned bank of america because that kind of strock destroyed it. washington, mutual, fannie mae, freddie mac and these destroyed people and it will take a long time to get over the losses and they're still smarting from it. once they get over it, they'll

come in. >> final seconds here. questions for david and things you want to know comingity on of las vegas in the next couple of days? >> i want to know if these people are still short. what's their exposure? is anybody 120% long? then i'll get nervous. i'll get you nobody is. >> all right. let's get what's up next on "mad money?" >> weyerhaeuser went to springfield high school. the spartans are the best and the quarter was great and he was charitable trust and you can still get 5% yield if they pick it. they do the nursing -- they do skilled nursing facilities and 5% yield still better than your cds. >> incredible. we'll see you later, jim, 6:00 and 11:00 eastern time. >> say hi to doers for us. >> i'm not -- >> more "squawk on the street"

coming up after this break. don't go away. jeff... hey, scott! this is no time for lollygaggin', lad. the chickweed and the dandelions are wreakin' mad havoc! now's the time to send in the scotts turf builder plus 2, man! it kills weeds while it feeds and strengthens your grass. feed your lawn. feed it!

it kills weeds while it feeds and strengthens your grass. anbe a name and not a number?tor scottrade. ron: i'm never alone with scottrade. i can always call or stop by my local office. they're nearby and ready to help. so when i have questions, i can talk to someone who knows exactly how i trade. because i don't trade like everybody. i trade like me. that's why i'm with scottrade. announcer: scottrade- proud to be ranked "best overall client experience."

let's get the road map for the next hour. the bank of america shareholder

meeting kicking off right now in charlotte, north carolina. we will break down the issues facing ceo brian moynihan coming up. plus disney, the final dow 30 component to report early this season. we have an analyst who says that disney will benefit from new market opportunities and he will analyze exactly what those are coming up. >> zillo shares under pressure after yesterday's earnings report. we'll talk to the ceo in a first on cnbc interview about his plans for the online real estate company. >> and hacking america. symantec ceo will join us to talk about the rising cyber security threat. >> our own david faber is in sin city at the salt conference and he has a lot coming up later in the show. good morning. >> good morning, carl, that's right. we're at the salt conference where many of the big hedge fund managers from around the world descend and all of those firms that like to feast on the management fees also descend. we'll be talking in the next hour or so with bill vratos,

both credit and e itty. >> we will talk about schoenfeld asset management who led the charge in the t-mobile deal to get them to change the terms to buy pcs, successful in that and an activism there and an event that we'll be talking about, about event investing that will be hard to come by given the dearth of m & a. >> in the meantime, financials including b of a helping to push the market higher. i want to bring in frank paulson, chief investment strategist from wells fargo joins us this morning to talk about the markets. good morning. >> good morning, carl. >> you have written. it's almost become a bit of a joke to some because you've been persistently bullish all of the way through even though some doubted the market at times. buy in may and you'll be okay. i wonder if you know how this month is turning out. >> it's looking so far, anyway, i think my whole point was in the last couple of months in

march and april. we refreshed a lot of the sectors and initially the rally last fall was led by cyclicals and since february by defensives and they've had their day in the sun and in the shade and none of them were overextended and a lot of hurdles were facing the market in february and march. we have a lot of optimism. bond yields are backed up over 2% and the money supply had stalled and the dollar was soaring and the gas prices were up to 385 across the country. we had another mini eurozone crisis with cyprus, and what happened now is all of those hurdles have kind of dissipated or reversed, and i think you've checked sentiment and you've brought yields back down and now you're setting up a chance for a rally again that might be here in may. >> you think 1700 year end is possible, but it doesn't sound like the back half of the year will be a cinch by any means.

>> i think so. i've been of the view since december that we touched 1700 maybe this year. not necessarily year-end target, carl. i kind of think it's confidence. it's rising and running right through the equity market and it's also run right through the gold market with the premium coming out and ultimately in the second half, it's also going run right through the bond market. i do think that we'll have a ten-year yield that goes up, and maybe closer to 2.5% to 3% and as that goes up and as the discussion of the fed ending qe intensify, i think stocks may struggle a bit down to the finish line in the end of the year. >> what's driving the confidence, though, jim, when you have revenue basically flat in corporate america. unemployment and these revisions with employment and nowhere near where they needed to be and the guidance more negative than positive. >> i think the economy, you know, the speed limit hasn't

increased that much, but it certainly broadened out, carl, just in the last 12 to 18 months. if you go back 15 months ago, we had an unemployment rate closer to nine than 7.5. we had very little job creation. we had no housing activity and home prices were still flat to down and there's very little bank lending and confidence is still pretty low. a lot of people were in place and doing better at the same time and we were firing on all cylinders in the economy and people sensed that. it's not so much that the economy thinks it's really robust. it's more that they think it's sustainable and less vulnerable for shocks and they pays for higher multiems for stocks. >> you would continue to recommend financials, and manufacturing and emerging markets and more aggressive, cyclical plays. i think part of that is because the cyclical his such a rough time between february and april here. they are just now regaining their footing and i think

they've been sort of refreshed and i think it's time to take profits out of those defensive stocks that ran so hard and to replow some of the capital toward the cyclical side of the economy. emerging markets in particular. the industrials here in the united states and i still like the financials which have done well throughout, but i really think of all of the ten sectors in the s&p, carl, confidence benefits the financial industry more than any other because the business of finance is all about confidence. you don't make or take without it. you don't bring an m & a, and you don't bring a capital investment and we're seeing rising confidence and we're seeing sustained leadership with finance stocks. i think that will continue. >> when you talk to clients finally, jim, who might agree with everything that you're seaing, but still have large questions about how central banks reverse these balance sheets and where the exit is for, you name it, any central bank around the world. what do you tell them?

>> well, that's my biggest concern, carl, longer term. i think the fed has overdone it. i think they're staying with full-flot lot will stimulus for way too long which clearly is no longer in crisis and if they don't back off the gas they could create more of a crisis this time more of an inflationary variety they could prematurely abort the economic recovery and the stock market run. so i'm not sold that that's the way it will play out, but i do think the biggest risk beyond this year is that the fed has overstayed and creates a crisis. so you have to be sensitive to that, and we may have an early end to this rally, one that could have continue order if the fed backs off the gas and maybe we have a multiyear run ahead of that yet. >> we keep looking for signs of that happening, that's for sure. >> jim paulson, wells capital management. >> let's stick with that

financial theme at the bank's annual meeting and kayla tausche is monitoring those, vents at hq. it will be an interesting meeting, kayla. >> it will. they always are, simon. think bah of america has been steadily chipping away to the housing crisis and it's been returning more capital in the form of a buyback. the stock looking up at 67% in the last year and investors are buying more of it and getting more bullish. today in charlotte, north carolina in a meeting just getting under way right now they'll be able to put their questions to ceo brian moynihan and the shareholders will cast votes on eight of the foremost issues of the company, first reelecting its board. five out of 18 directors will not stand for reelection as previously announced. six new members have been appointed in the last year to fill those holes. among them, former executives from hca and pepsi as well as the current company of bae systems and other company directives and appointing pwc as auditor. bank of america's proxy among

them, requests for disclosure and rules on lobbying and political campaign spending and the director served on no more than three boards and they can nominate new board members, too. a deeper review is requested in the troubled foreclosure and servicing practices. that last one is the services line and it was by ag schneiderman. perhaps the most interesting part of these meetings, guys, the colorful questions the executives field from shareholders. last year one shareholder asked brian moynihan whether he loved his neighbor as himself and that was relevant in the stock performance. >> in the meantime, those questions is as to whether they can cut the $8 billion out of the bank while trying to increase the revenue. >> exactly right. we're expecting that that's going to be a finished program by the end of 2014. so, of course, the big question,

simon, is progress on that program, too. >> okay, kayla, we'll see you throughout the day. kayla tausche on bank of america. let's send it over to josh lipton for market flash. we're watching 3d systems. that stock has been halted, simon with news pending. the stock, of course, has been a rocket ship. it's up about 108% just over the last 12 months. we did find out yesterday 3d systems announced that it would sell shares in the public offering of about 250 million. perhaps we'll get more insight again and 3d halted for now will bring them more headlines as we win them. >> thank you very much, josh. up next on the program, disney getting a boost from "iron man 3" hitting new multiple highs this week. should you book profits moving forward? we'll talk about those second quarter numbers, theme parks and moves. later the ceo of zillo will be live with his reaction to the

drop in the company's stock today that is off in a phenomenal run over the past year. ♪ [ laughter ] ♪ [ female announcer ] each one of us is our own boss. ♪ and no matter where you are in life, ask your financial professional how lincoln financial can help you take charge of your future. ♪

our results had a great quarter that was helped a lot by some of our new investments issue notably at disneyland and florida and hong kong. our cable networks led by espn had a good quarter and all in all a great quarter for the

company. >> that was disney's ceo bob iger on "closing bell" last night, talking about the second-quarter result. tony wibel is an internet and security analyst. he joins us now on the newsline, good morning. >> thanks for having me. >> tony, everybody is talking about the investments that they made in, for example, theme parks in a difficult time after the financial crisis in 2008. theme parks presumably still take second place to espn when it comes to profitability. >> yeah. absolutely, but what's really key here is on espn, the largest source of revenue is the monthly affiliate fees and we have dialled in what those fees will be for a long-term horizon. i think the biggest swing fwaktor here really is going to be the parks and the high return on investments that these guys are pulling initially. >> the stock has done phenomenally well over the last year, can you continue to buy

the stock on the basis that there are further rewards to reap through the tleem parks? is it material if you're already at $64.88? >> i don't think so. i think you have to look at it on a relative basis. all of the big cap media is up 25% to 30% and from here, all of the positive things from disney people know about, i'd rather look at a controversial tram like a viacom that trades at 12.5 times earnings. yes, disney will continue to go up. the peer group will continue to go up, but i think there will be names in the peer group that will outperform. >> is that purely on a valuation basis, or does it have dynamics that interest you? >> no. one of the secret things on viacom is the relationship to iron man 3 and the avengers. few people realize that when they sold the distribution rights to disney that they'll get a cut from the receipts that land in the theatrical and dvd and the tv wend owe and frankly,

there will be a very high margin on that given that they have no cost structure there. also when you compare and contrast the stories, they are in an extremely lean expense structure while seeing a strong recovery in some of the ratings after going through a rough patch last year. >> interesting. there's a sort of an almost silly question, but maybe not. how crucial is re-signing robert downey, jr., to that franchise. someone suggested he's as valuable as any franchise to any any studio right now. >> think it's key. you can see the value how you pulled out "iron man 3" and pulling a similar growth in the avengers, if you pulled out thor or captain america, you wouldn't have these kind of numbers. you'll never know unless you actually pull it out, but i think it's a risk not worth taking. he's definitely the billion dollar man right now. >> it is often said of the movie business that it's kind of the

icing on the cake. it's not central to disney or to other media groups. does that change now with the way that they're using the marvel franchise? are you saying that this is a -- a lockstep difference in hollywood? >> yeah, i think what you're seeing with disney is investing in these great, global fands and finding it to distribute for five major mechanisms. >> we think about marvel and des me. i think those two companies built themselves together. i think marvel couldn't have licenessed it, but at the same ti time, it's the legs to pipe through the land of the business. >> tony likes to hear from you. >> straight ahead, shares of zillo down sharply today. we'll find out if they can keep

raising the roof in the face of higher marketing costs. spencer rascoff will join us with his reaction on the company's first quarter results when we come right back. [ female announcer ] there's one thing dave's always wanted to do when he retires -- keep working, but for himself. so as his financial advisor, i took a look at everything he has. the 401(k). insurance policies. even money he's invested elsewhere. we're building a retirement plan to help him launch a second career. dave's flight school. go dave. when people talk, great things can happen. so start a conversation with an advisor who's fully invested in you. wells fargo advisors. together we'll go far.

♪ [ agent smith ] i've found software that intrigues me. it appears it's an agent of good. ♪ [ agent smith ] ge software connects patients to nurses to the right machines while dramatically reducing waiting time. [ telephone ringing ] now a waiting room is just a room. [ static warbles ]

welcome back to "squawk on the street." i'm josh lipton. this one is for the gamers out there. electronic arts is ripping higher this morning. the gamemaker saying it now expects adjusted earnings for its coming fiscal 2014 to be $1.20. the street was looking for $1.10 and the street is reacting. jefferies and credit suisse raising price targets. >> thanks very much. josh lipton. shares of zillo, the real estate website swung to a loss. revenue for subscribers slumped and the stock's been on a tear, as you know, up over 100% so far this year. here first on cnbc is spencer

rascoff, the ceo of zillo. good to have you back. >> thank you. thanks for having me. >> pretty good quarter, new heights in traffic and record revenue. you boosted your revenue outlook? some on the street will argue the low-hanging fruit has been picked. >> we'll see. it was a great quarter top to bottom, and we beat on ebitda, and metro traffic. i think what the stock has reacted to is we've made the decision to invest for the long term and operate at a lower level of profitability, intentionally than we might otherwise and we are investing tens of millions to advertise the zillo brand. nine out of ten americans still don't know the word zillo and we intend to change that and that's the decision for long-term investor traders aren't going to like that decision and that's what you're seeing today and that's fine. we're in it for the long term and we're making the decisions

for zillo. >> you're talking about these marketing cover thes and we believe the current multiple currently reflects a positive outcome. the upside during this investment cycle could be limited. how much are you prepared to see the shares come down? >> well, what i care about is what is the company worth five and ten years from now, and i believe that investing to grow awareness ever zillo is critical. so in our category, 27% of americans can't name a real estate website. that's shocking to me. there's no other cat gore oat internet where 27% of americans can't name a company in the category. we think through advertising we can change that. so we're trying to grow zero brand's awareness, and in the long term that will make zillo a must-buy for advertisers and critical for real estate agents trying to market their business. that will result in short-term margin reductions and we think long-term value creeing a. >> we have mortgage apps numbers out today and another solid turnout and it looks, spencer,

like a lot more of the housing recovery is being driven by those not flipping a house, who actually do need a mortgage to findance a place they're living in for a while. do you think we're going have a second half that's as strong? >> well, last 12 months, home values are up 5%. zillo economist estimates home values will be up 5%, but there are parts of the country getting ahead of themselves and they're up 20% year over year and that's unsustainably high and that will cool down. what's happening in the housing market is low mortgage rates and low inventory levels and improved confidence is what's driving home values up. overall, this is a much healthier housing market except for those overheated markets and so i'm feeling very bullish about hoizing and prime you haved by our confidence. >> what we need to see is we need more inventory onlean

because they're being driven by artificially low inventory levels and that's a stabilization that needs to happen on a market by market basis. >> some have this argument, spencer, that guys like you and trulia, if starts to increase and inventory gets more broad and define something that you like and maybe you don't have to log on to a zillo to find a house. is that a reasonable argument? >> no question that the home buying experience is dramatically different from the last time most americans bought their home. now we have this incredible information in your hand on a smartphone. information on every home in the neighborhood and that's a complete mindshift from the last time you bought your home five or ten years ago. power is distributed through mobile devices. in zillo, most of the visits is from mobile geeses so they've shifted from the desktop to a celler have geese. consumer loshinging at zillo is three times more likely to

contact an apple. so we love this maying raising toward apple. >> you've made that point several times on our air. >> you made history last night and you became the most publicly-traded company to take questions on twitter and facebook. my sources say the turnout wasn't great, but would you do it again? how do you feel about it? >> we would do it again. it was a bit of an experiment. we had a couple of questions from sell side analysts and retail investors. there was a time in the mid-'70s when ibm and at&t first decided to have a telephonic conference call and it was probably controversial at the time and some day we'll look back to may 2013 and laugh that it was controversial. this is the way communication is moving and you see it on cnbc where anchors and reporters are engaging through social media every day and this is the way companies will engage with investors more and more. i view it as a success. >> spencer, always good to have

you. >> please come back next pipe. >> spencer rascoff from zillo. >> still ahead, the cyber espionage war between china and the united states is intensifying. find out what american companies need to do now to protect themselves and the country. the ceo of symantec will join us exclusively after the company reported quarterly results that again disappointed. he can focus on his recovery. he doesn't have to worry so much about his mortgage, groceries, or even gas bills. kick! kick... feel it! feel it! feel it! nice work! ♪ you got it! you got it! yes! aflac's gonna help take care of his expenses. and us...we're gonna get him back in fighting shape. ♪ [ male announcer ] see what's happening behind the scenes at ducktherapy.com.

governor of getting it done. you know how to dance... with a deadline. and you...rent from national. because only national lets you choose any car in the aisle... and go. you can even take a full-size or above, and still pay the mid-size price. this is awesome. [ male announcer ] yes, it is, business pro. yes, it is. go national. go like a pro.

wednesday morning on cnbc. good morning, we are an hour into trading. it's 7:30 on the west coast and 10:30 here on wall street. disney reported a better-than-expected quarterly profit. revenue also topping the street's expectations. results were helped by higher spending and attendance at its u.s. theme parks. the health information provider reporting a q1 result that again, was better than the street was expecting. web md also announcing that its ceo is leaving. and mcdonald's reporting global sales for april fell 0.6%, a bit worse than the half a percent drop that analysts had forecast. we have some breaking news over at the nymex. let's go to courtney reagan. >> that's right, simon. we are just getting the weekly

data from the u.s. energy administration and it looks like the crude oil is up 230,000 barrels. we were expecting up 1.9 million. so much smaller than expected. crude oil is trending right about the same as we were shortly before the numbers came out and we were talking about gasoline and we see the gasoline down 900,000, 910,000 barrels and that is actually larger of a drawdown than what analyst his been expecting when they were survey surveyed. it looks as if we're also up, but not entirely a lot for gasoline in reaction to that. distillates, wooey see are up 1.8 million. so some interesting numbers here, but it doesn't seem we're having a lot of reaction in the energy market and we got that import data out of china overnight and some of those signals were bullish for crude oil that are weighing against each other and the numbers move up and crude oil trending around

the $96 mark, back to you. >> pentagon soying the first time wash wish has directly accused china of such attacks. symantec reported earnings that did beat the street and they gave des appointing guidance on the call. joining us is steve bennett, the ceo of symantec. how are you? >> good morning, carl. how are you? >> i'm good. i want to get to the are the quarter itself and let's get this espionage business out of the way. what do you think is behind what the u.s. is trying to say here and how is it material to your business, if at all? >> well, i think cyber crime and the attacks around the world are a big problem for companies, customers are ours and individuals because all are affected. i don't think it's just china. i think the u.s., russia and china are all large countries that have these challenges. i think that the world as we

become more digital and managing and protecting your digital information is becoming more and more of a threat is a tough environment for our customers and for us as citizens so we're working very hard to do a better job of protecting people in their information as we go forward in the world and that's why our business is growing and we're making some progress. >> i assume you're feeling sort of that sentiment and that concern that has to be driving some business and obviously, as you mentioned, the guidance last night wasn't terrific. there are some yen issues to blame and give me the mix of things that are going right versus things that are still tough. woe had record quarter last yore. you had organic growth which is the largest growth we've had over the last five years. we are transitioning and transforming the company and we've committed to revenue of 0% to 2% this year which is the same thing we told the street in january, but we're delivering 200 basis points of additional

profit which on a 7 billion company is $150 million. so we feel good about the guidance for the year. i think investors interpreted the first quarter as being soft because of the quarterly pattern and we're committed to the numbers that we shared and we're very bullish about the 15 to 17 timeframe. so i think we have noise in the short term, but we'll get through that. >> we've all got worries about pc sales which we talked about constantly. at the same time we have worries about capex and signs that companies don't appear to be in any rush to spend more on their i.t. budgets. which of those two, do you think -- which fever breaks first? >> well, i think that security and information management are areas that according to idc are both growing in the 6% to 8% range. even though the i.t. and capital market is difficult. the market is still growing because information is exploding and the security environment is more challenging than ever as witnessed by the intro you gave on the threats that are out

there. >> you know, steve -- >> good morning. it's simon hobbs. you started this interview by talking about the cyber threat as being a national threat, but actually it is fought by individual companies and individual attacks that have to individually have to protect themselves. do you think we have the right struck are in fighting off what is happening at the moment because it doesn't appear that we're leveraging economies of scale to fight what is a national attack. >> couldn't agree more with your comment. it's individuals, businesses and its countries that are vulnerable here and i think that's why we were pleased that symantec with the president's executive order and we're hoping legislation can go through so we can do exactly what you're saying and whether it's information sharing. the bad guys are getting more sophisticated and the threaten viernment is exploding and we all need to work together and do a better job for the constituencies, people, companies and guidance. >> can i push you further on the

strength of the tech lob ney a moment and in a desire to encourage silicon valley who is doing a disservice. >> it looks like it will get behind the sfieb when it comes to tapping the internet all they'll do is find those that don't comply with orders. there's no suggestion that we should have a continuous chat on facebook or google that could be accessed or that there will be an independent new agency to deal with after the boston bombings what many people think is an important issue. what congress is balancing is the threat of individual privacy and security. you can't have privacy in a digital world without security and they go together and we just have to work through the politics to get something pushed forward because the concrete and people in companies are losing ground against the bad guys and we're working hard to step up and learn this industry and with

governments around the world to make a difference. we'll talk about it more in the future. >> next on the program, ahead of the release of "hangover 3" we are headed back to sin city where david faber has his own wolf pack. we will be joined by one of the country's largest hedge funds, york capital and where he sees opportunity in the market. plus richard fish or the fed, monetary policy and the economy. he'll give us the scoop on the fed's funds. we're back in two. is streamline their process? at fidelity, we do it by merging two tools into one. 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. [ lorenzo ] i'm lorenzo.

i work for 47 different companies. well, technically i work for one. that company, the united states postal service® works for thousands of home businesses. because at usps.com® you can pay, print and have your packages picked up for free. i can even drop off free boxes. i wear a lot of hats. well, technically i wear one. the u.s. postal service®, no business too small. well, technically i wear one. are you still sleeping? just wanted to check and make sure that we were on schedule. the first technology of its kind... mom and dad, i have great news. is now providing answers families need.

siemens. answers. >> the salt bridge alternatives conference is under way. our next guest is a partner at

work capital, right, david? >> that's correct, carl. people are filling in the various ballrooms and things and we are joined by bill vratos. he is a $15 billion fund and whether it's distressed in any number of other strategies. so i want to start there. >> thank you for being with us, by the way. >> thank you for having me. i want to start in europe, we talked with your boss, jamie dimon three years ago at this very conference when things started to implode there with significant impact on our own equity market. where are we with distressed assets that seemed to acknowledge that these were not good assets. right, we are just starting to see movement now after three years with the capital markets and we're engaged with three years to earn back capital to take losses and finally with a new ruling called crd4 capital

requirements directive four, part of basel three which was adopted three months ago, we are starting to see movement. regulators are saying you have time to earn back capital and you have now a scorecard so you can run the math on how you need to be and let's go. we've seen an enormous uptick in activity and it's different from our traditional business of just corp at loans and bonds. it's all sorts of assets, but the activity is picking up and over half of our investments in our credit strategies are now overseas. >> they are in europe. >> dominated by europe and this newfound willingness on the part of the banks to part with some of these assets. >> is a large part of it. >> give me some sense here. we're talking the spanish bank that is saying we have to acknowledge this is worth 5 cents on the dollar? >> that's a perfect example. near the end of the year, we bought a portfolio from a

european bank at 3 cents on the dollar. >> what was it? >> it was a bunch of consumer loans, unsecured consumer loans. so you took a loan or you own a business or you guaranteed a loan and you haven't paid in a while and again, the capital credit on that type of a portfolio is low. >> 3 cents on the dollar? >> yes. >> what's the strategy there for you. if you can get it up to 6, you're up 100%. >> that's the strategy. in this case, even though the asset less liquid than the normal type of thing we would buy, it almost is self-liquidating in the sense that we take our money out in a year or so and then we're just playing for profit, we begin to self-amortize or self-liquidate. >> it's not like buying a bond or a stock and your a hedge fund and you have loyal investors out there. none the the, they can pull. it is different and we veer toward, if it is a less liquid

type of investment, we will sheer toward things that are self-liquidating and short-term in nature and the types of things are all over the place and the loans and bonds are traditional business and those are more liquid, but there are more esoteric things and electricity bill receivables and aircraft leases. some of these things, though, we've bid on buildings. we bought a half-built ship. >> you bought a half-built ship. >> you have to put in the capital to build the rest of the ship. >> to complete it. we have a half-built ship on ten cents on the dollar and we're investing to complete it. again, it's not something we're going to sell tomorrow or get a quote from a dealer on, but we've already received bids and the ship's 80% built? how long do you think the cycle is going to last? if now, finally, i would assume you've been being looking at it and waiting for them to start, how long will it actually be until this ends? ? it's a good question because

europe is a bank-dominated market and the regulators, while they want to clean up the banks want to give them team. it will be prolonged as long as the capital markets are engaged, it it will be less of an '02 or '08 like blown-out type of pricing and cycle and we'll be more liquidity providers saying we will buy this at a discount and fix it and extract our value and allow you to clean up your balance sheet. >> you'll be making a lot of trips to europe, i would guess. >> i already am. what are you saying when you go over there and spend time, what is your general sense of europe right now whether it's bottoming or not? >> i think any kind of bottoming you would have to look at the fall 2011 as at least a bottom in terms of complete market

chaos and potential for things to unravel. loss of faith and government. exactly. we the types of corporate assets we look at are for sale then. things are more organized and people have more faith that the governments have scripted a plan. that being said, while the issues are similar to those we have here in the u.s. from a big picture sense, it's much more complicated because you have 17 governments as opposed to just two parties fighting over the same issues. >> what are you hearing from business leaders in terms of their own business and the bankers that you are dealing with when trying to buy some of these assets. >> certainly, the business outlook there is far less u bull yent in the united states which is not saying much. >> so people are much more conservative in terms of ceos or the banks themselves as to how this all plays out and everyone

including ourselves to some degree to a degree depending on ecb and the other big authorities in play to keep things together. >> distress is its own animal and clearly, you've defined how you can realize returns there regardless of the crediten viern, butvier viernment, but i do want to ask what does it do to your outlook given where we are and where we may go. >> sure. the credit environment is far more robust than a year and a half ago, each six months ago. this is a different environment. there are fewer just stray, aggressive sales that we see. things are a little more thought out and deliberate. however, when we find an orphaned or troubled asset and we are able to buy it well, given the backdrop, we are much more definable value gap and exit strategy in terms of once

the asset's fixed and it now can be sold where we can work it out in pieces. so in some ways it's a good environment, but you have to work harder to find things. >> working hard is never that bad. >> thanks for your time. bill vratos, the banks in europe are finally trying to add some stuff. >> in vegas do they party or work hard? >> they work hard. and i try to sleep. that is what i like to do is get my sleep. >> david faber at the salt conference. forget bailouts. rick santelli is talking about bail-ins and that's next on the santelli exchange. the fight against obesitobesity. we'll sit down with the president of coca-cola america as they announce their latest initiative. [ male announcer ] there are people who find their own path.

and never back down. who believe the american dream doesn't just happen, it's something you have to work for. ♪ we're for those kinds of people. because we're that kind of airline. and we never stop looking for a better way. it's how we've grown into america's largest domestic airline. we are southwest. welcome aboard.

dow is positive just by a touch after spending most of the morning in negative territory.

let's get to the santelli exchange. rick santelli. >> hi, carl. . bailouts. taxpayers on the hook. sounds easy. but it isn't easy. as a matter of fact, there's a piece in the op-ed journal every wednesday. i always look forward to his pieces. first of all, there was a lot of to do when cypriot banks had money taken away by those who within uninsured. but maybe worse, as mr. jenkins jury was duly sworn brings brings up. it's the exemptions. the rule of law is something that is obvious to all and you operate in a system where you know the rules. when you have a bail-in, as enticing as that sounds.

if you exempt municipalitiemuni unions, the bigger the list grows, the bigger the haircut for those who are left. today in the irish times there was something i would like to put in the screen in front of a big meeting next tuesday. please. depot citizens of over 1,000 euros are likely to be hit according to a proposal ahead of key finance ministers. they may get together on monday as well. michael newman is the person referred to on the irish side that's going to chair this. the reason it's key because ireland wants to have the same as the cypriot banks had. it suspect only the details about bail-ins. do you remember in march when

everybody was tickled to death because austerity was out the window? hip-hip, the monster is dead. i believe austerity gets a bum rap. forget that for a moment. not only do the issues regarding ireland and bail-ins and stencils, which were actually going to be addressed at some period way down the road by the european council, but also getting their budgets back in order without austerity. if you're a trader and see the big influence as the european pass the baton to our time zone and then you have the european close several hours later, pay a lot of attention monday and specifically tuesday. may have tape bombs, as we say, on the trading floor. carl, back to you. >> good advice. rick santelli in chicago. still ahead, shares of delta rallying on the news the airline plans to return more than a billion dollars to shareholders in the next three years. first time in more than a decade delta has been able to return

cash to investors. and we'll sit down with richard anderson, the ceo, in a first-time interview in a little while. my mantra? trust your instincts to make the call. to treat my low testosterone, my doctor and i went with axiron, the only underarm low t treatment. axiron can restore t levels to normal in about 2 weeks in most men. axiron is not for use in women or anyone younger than 18 or men with prostate or breast cancer. women, especially those who are or who may become pregnant and children should avoid contact where axiron is applied as unexpected signs of puberty in children

or changes in body hair or increased acne in women may occur. report these symptoms to your doctor. tell your doctor about all medical conditions and medications. serious side effects could include increased risk of prostate cancer; worsening prostate symptoms; decreased sperm count; ankle, feet or body swelling; enlarged or painful breasts; problems breathing while sleeping; and blood clots in the legs. common side effects include skin redness or irritation where applied, increased red blood cell count, headache, diarrhea, vomiting, and increase in psa. ask your doctor about the only underarm low t treatment, axiron. ♪ [ indistinct shouting ] [ male announcer ] time and sales data. split-second stats. [ indistinct shouting ] ♪ it's so close to the options floor... [ indistinct shouting, bell dinging ] ...you'll bust your brain box. ♪ all on thinkorswim

from td ameritrade. ♪ [ agent smith ] i've found software that intrigues me. it appears it's an agent of good. ♪ [ agent smith ] ge software connects patients to nurses to the right machines while dramatically reducing waiting time. [ telephone ringing ] now a waiting room is just a room. [ static warbles ] . so i should run and then just drop down? >> yeah.

>> oh, i can't do this. can i go like this? i don't think i can do this. ♪ okay. that wasn't so bad. high five. thank you. thank you very much. yes, this network's coverage of the arrival of norwegian's new private cruise ship proving once again that let's have some fun, fear is the logical reaction. i was told to film standing on the 10-foot garden that hangs off the edge of the ship hawaii they didn't tell me to get there is you have to navigate what they call the ship's rope jungle. now, carl, do you feel my pain here? >> i -- sort of. it looks like it was a poorish choice of shoes. >> it was. because i was in a suit. i was at work. i didn't expect to do this sort of thing. you moe what really scared me i'm not sure that you could see,

but i would fall into the harness because the way that it was cut, a middle age man would be singing the rest of their life. >> look at that. is this going to draw in new people who haven't taken to crews before? >> yes. increasingly it's about what you add onto the ship. you can talk about the water slides and all the rest of it. the quantum ship that's coming from rival caribbean. they have a 200, 300 feet off the sea, out the side of the ship. so it's all this sort oaf extra stuff that kids are going to want to do. give us a sense as to how high up you are? >> i'm only about 30 or 40 feet off the top deck. but i mean, your way up there with the torch of the statue of liberty. you're 14 stories high, whatever it is. it was very scary. >> and who is the smooth dude? >> he is -- i think he's called manuel.

he always launches all the ships. i mean, he was very helpful. the trouble was you can't really say no when you have all the prs lined up. >> no, you're committed once you're there. word is you're going to be doing something like this every week. >> i don't think that's true. >> nice stuff, simon. we'll see you in a few minutes. if you're just joining us, hera what you missed earlier on. >> welcome to hour three of "squawk on the street." here's what's happening so far. >> the ceo is not going to lose his job in today's world for not doing a deal. but he can lose his job for doing the wrong deal. >> there are people out there who are embarrassed, but in our mind it's really tough not to be bullish today. what the fed is doing here, they're forcing money into the equity market. >> one of the thing ha really happened with the market st there are sectors they are dying to get out of and other sectors moving in.

one thing we have seen in the last week is the financials have really come alive. that group is so cheap. how can i tell them to get out of those. >> then you get these really easy -- and they're not going up. >> they may not make it. and if macy's decided to put them out of business at predatory prizing, they could do it. >> we're trying to grow zilla's brand awareness to something much, much, much bigger. over the long term they will make zillow a must buy for advertisers. so that's going to result in short-term margin reductions but we think long-term value creation. i think the world as we become more digital and managing and protect is becoming more and more of a threat. it's a tough environment for our customers and citizens. we're working really hard at protecting people and their information.

>> good morning. we're live here at post 9 of the new york stock exchange. the dow is almost exactly flat at 15,056. down just one-tenth of a point here, of course, as we crashed into positive territory earlier this morning. we continue to watch the dow at record levels above 15k. s&p is up to 1,628. and the nasdaq is up. jc penney reporting another quarter of weakening sales. they did report cash levels higher than expected. and from the clothing shelf to the grocery shelf, whole feeds by 3 # cents. revenue is in line. the company is announcing a two for one stock split. let's get the road map for the last hour. coke is pledging to help combat obesity. find out if that could help keep shares healthy as well.

we'll get richard fisher's latest thoughts on monetary politician, inflation and more. plus, something it's not been able to do in nearly a decade, return $100 billion to shareholders. we'll start tw the dow component, coke and the new push to help fight obesity. this morning the company says they will work to make lower calorie drinks more widely available around the world. this comes as the sugary drinks are fuelling the epidemic. president of coca-cola america which includes the north carolina and latin america operation. steve, good to have you. welcome. >> thanks, good to be here. >> i would love to walk through what is new. a lot of consumers may think to themselves i already see a lot of nutrition information on the packages already. what starts today? >> well, what starts today is a global commitment and invitation to join us in helping fight this

obesity epidemic. many of the things that we have committed to, we are already doing in the united states. but importantly this is a global commitment to really advance an important agenda around fighting obesity, and one of the really important things that we're doing more and more of is this inspirational towards more physical activity. and more transparency. we believe obviously obesity is a complex problem, and requires a solution that brings business, government, civil society together to not only address calories in, but very importantly get people on the move, inspire them to burn more calori calories. >> obviously we're looking at the details on our screen, offering low or no-calorie beverages, vergely in every market where you operate, putting nutrition information on the front of the package as opposed to the back. some may wonder why now, steve. we have all seen what's happened in new york city where it looked like the industry had gotten a

reprieve from mayor bloomberg's plan. why is this building critical mass at this particular home? zbr well, we think obesity has been a growing problem if many years. a lot of what we're doing is a continuation of what we've been doing for many years. but we believe firmly that business, government, civil society working together is the solution. so obviously we did get a reprieve in new york, but that's not the end of it. we're advancing programs in cities like chicago with mayor emanuel, in san antonio with castro today. in atlanta with mayor reid. because we believe that the solution is much better when business and government work together. put together programs to get people on the move, to get people educated about energy balance and so, while we continue to try to work with new york and we have many great programs in new york, we'll continue to advance the idea that working together is a much better approach than working

separately. >> we obviously watch the stock here at this network, steve, as you know. it's had a good year. it's outperforming the dow. is there a way to quantify what, for instance, not advertising to kids under 12 does to sales of at least the fizzy stuff? >> we don't advertise to children today. it's a continuation and reafor nation of that policy. that's important to note. but in terms of business, this is not about selling less coca-cola, let's be clear. we're very proud of the brand with 127-year history behind it. we offer a whole portfolio of low and no calorie beverages that provide incremental opportunities for us. efrl from smart water to vitamin water. we have a vid portfolio for all sorts of occasions. we don't see this as a damper on business opportunities but instead just being a good

corporate citizen. using the coca-cola voice and our tools to make people more aware of energy balance, get them on the move, working together with governments. >> but there's no reason to suspect it may be any kind of head wind on case with volume. >> no. we don't think so. we don't think so at all. we think it's an opportunity to offer a wide variety, a different portfolio of low and no calorie offerings alongside the brand that we're very proud of and 127 years old today. >> i wonder, steve, you do a slew of r&d. people don't realize how much you're working on formulas and taste. is there any way sugar soda may be replaced by something people couldn't tell difference from. it may make sugar and so da a thing of the past? >> i don't think so. this notion that sugar today is worse than when we were growing

up is not true. only one-third of calories come from beverages. two-thirds come from food, as a matter of fact. we're not saying there's anything wrong with sugar sweetened beverages. we will innovate and offer local ree options but never as a replacement for the fantastic brand, coca-cola that has been around for 127 years and is absolutely part of a healthy and balanced lifestyle if many, many, many people out there. >> that's a good message, steve and obviously getting a lot of attention today. appreciate your time very much. >> great. thank you very much, carl. >> steve is joining us from coke in atlanta. other health news this morning. the department of health and human services is about to do something it's never done, release information on how much different hospitals charge for the same medical procedures. hampton pearson has the details on that. hampton, good morning. >> carl, you know as consumers of health care, meaning all of

us, when you start to go in the numbers there will be shock and ah. in 45 minutes the government is going to release data nationwide that shows huge gaps in what hospitals charges for medicare. the data looks at what #,300 hospitals billed medicare for the most common patient procedures. a few examples are the huge cost differences for essentially the same procedures. a hip replacement costs more than $321,000 at a medical center in upland, pennsylvania. but just over 20,000 at an orthopedic center in akron, ohio. probably worth the drive to save that kind of money. next, acute mild cardio infraction, a heart attack to you and me. 210 thourk at a medical center in new york versus $7,000 in michigan. who knew? our final example. major gastrointestinal

disorders, like gallbladder surgery. costs $150,000 at a medical center in new jersey but just over $5,000 at a hospital in arkansas. it's all only a huge 4,600 data base from the center of medicare and made kad services, transparency about medical costs like we've never seen before find out how hospitals in your own community measure up. this will trigger a huge debate for why such big differences over the same procedures. hospital sticker shock, if you will. carl? >> it's an incredibly important topic, hampton and the numbers are astounding. thanks a lot in d.c. when we come back, we'll go back to sin city. we're sitting down with peter schoenfeld. plus. mcdonald's reporting global sales down by 0.6. hutch longer will the tough times last? we'll take you inside the tough

numbers later on. plus rick santelli talking to dallas fisher at this hour. >> absolutely. this is a big, big, a big interview you won't want to miss. not only is he one of the only fed people i've ever wanted to interview, but he quotes pat henry. he talks about the experience being lacking on the fed. never questions their intentions. but questions their programs. and some of the comments he makes, you may think i made them as well. maybe i did. you won't want to miss it. (announcer) scottrade knows our clients trade and invest their own way. with scottrade's smart text, i can quickly understand my charts, and spend more time trading.

their quick trade bar lets my account follow me online so i can react in real-time. plus, my local scottrade office is there to help. because they know i don't trade like everybody. i trade like me. i'm with scottrade. (announcer) scottrade. voted "best investment services company." what a day, bob. lots of activities.

lots of activities. >> yeah, we did it with thees s.

take a look at s&p materials on the rise today up 4% this week. cliffs natural one of the big gainer this is week. what a name that has been to watch, josh. >> absolutely, carl. cliffs natural resources in the green this morning. actually near the highs of the session right now. the largest reducer of iron ore in north america. one t company after close did declare a quarterly cash dividend of 15 cents per share. also a real executive saying in reports that he expects china's demand for iron ore to rise this year. clips up some 30% since mid-april. still down 40% this year and 80% from the all time high in june of 2008. >> josh, thanks a lot.

let's get back to faber. >> thanks very much, carl. we're joined by peter schoenfeld. you may have heard the name. creating the new company that listed just last week, tmus the symbol there. $2 plus billion asset management hedge fund focused on events. peter, it's nice to have you on it have finally. you've been doing this for a long time. you had real success here. you were the first voice. paulson came in as well. ultimately got t-mobile more. >> yes, it was great outcome from our perspective. it was the first time where we went to this extent, hired investment bankers. went to iss. got approval. went down to the wire for the shareholder vote. it was obvious to us and obvious in the end that this vote, this

deal was not going to happen, and we had overwhelming support from shareholders, and the arguments were pretty straight forward. it's a complex merger into metro pcs. but in the end it was too high of a con flick of interest. and we convinced shareholders they were better in a stand alone position and they would have been taking new equity. and at the same time we convinced them that they would be in a win-win situation. they would recapture the value and viability of the company. let's talk about the company. we have a lot more going on especially given the fight. people wonder what t-mobile will do. we had the ceo on with us. he indicated he would like to see more consolidation. do you think it's going to

happen? do you think it's going to happen? >> what is the regulatory environment like for the big players? part of the reason we saw the metro dt merger was because it was blocked, obviously, in their combination with at&t. at the same time, metro and sprint tried to get together for a period of time and they couldn't get the terms set properly. so the two came together. but you know, justice is of the view that they want four major carriers there. and it's not unlike what we're seeing in europe where there's resistance of going four to three in the wireless space. the question is are they more comfortable with a strong number three rather than two, three, and four that are weak relative to the overwhelming strength of

verizon and at&t. >> and of course, once we gain control of sprint it won't be weak any longer. that's still a big question. you're a big holder of dish shares. i'm curious what's your approach to this both from an event perspective, as potentially a sprint holder, but also a shareholder of dish. we think dish has an extraordinary amount of value. and so we're a little bit concerned if they take on too much leverage. there's similar arguments that we made, in fact, that the stub company, dish, might just be too highly leveraged under these circumstances. and so, they may change those terms and offer more equity, so we don't have the releveraging that we had. a lot of the similar arguments that we made, a lot of the synergies are very back-end loaded and speculative. sort of apply to this deal as well. so it remains to be seen. >> so are you a believer?

because so many dish shareholders have wondered openly to me whether this is for real here. you spent a lot of time studying this industry, given the pcst-mobile deal. do you think he's for real? >> i think he wants to extract something out of this. but the rhetoric is so tough between the parties. and kind of insulting. i think the prospect of reaching this where he gets the ability and hang it on the tours is becoming more remote. and the only other player there is t-mobile at some point. but people have had a tough time figuring out what he is going to do over the years. >> and we continue to. the final question from me here is simply, you got activism a

bit because of event related. but deals. we have hardly any deals. how do you operate an environment like that where there are not that many deals to come by? >> we don't need a huge flow of deals. we have to find the ones that we have comfort with. we have a whole group of analysts, pms focused on stress and destressed securities. we're finding an awful lot to do there. companies that are liquidating. going through liability exercises, and companies that are restructuring. we were involved in the equities of those companies after they complete their restructuring. names like that. which are coming out and which we own. and then softer tablet kind of situations. the kind of things where we don't have a formal deal, the return profiles are quite

attractive. and the flow, we're comfortable that the flow will come back, or the underlying issues that we have discussed a number of times on the air in terms of huge cash buildup on the balance sheets of the companies are there. there's a little bit more comfort with respect to gdp numbers. they're not going to be great. but we think they'll find their way into transactions going forward. >> peter, we have to leave it there. they're playing the music in my ear. very nice to have you. >> pleasure. thank you for having me. >> carl, back to you. >> when we come back, delta airlines ceo fisher will talk mcdonald's, too, in just a moment. oh, he's a fighter alright.

since aflac is helping with his expenses while he can't work, he can focus on his recovery. he doesn't have to worry so much about his mortgage, groceries, or even gas bills. kick! kick... feel it! feel it! feel it! nice work! ♪ you got it! you got it! yes! aflac's gonna help take care of his expenses. and us...we're gonna get him back in fighting shape. ♪ [ male announcer ] see what's happening behind the scenes at ducktherapy.com. dave's always wanted to do when he retires -- keep working, but for himself. so as his financial advisor, i took a look at everything he has. the 401(k). insurance policies. even money he's invested elsewhere.

we're building a retirement plan to help him launch a second career. dave's flight school. go dave. when people talk, great things can happen. so start a conversation with an advisor who's fully invested in you. wells fargo advisors. together we'll go far. mcdonald's reporting a steeper than expected drop in april. a couple of weeks ago we asked

ceo don thompson about his outlook for comp sales later this year. >> we're getting back to the basics at mcdonald's. and that will help us to continue to gain customers and gain share. this year we've already gained market share. the competition in the competitive set. 11 out of 13 weeks this year. we know we're get back on track. we'll get better as the year progresses. >> david paumer is a senior food and restaurant analyst. he joins us from new york. dave, good to see you again, good morning. >> good morning. >> some are pointing to the u.s. as a bright spot. >> that's right. if you could invest just in the u.s. turnaround from mcdonald's there could be exciting upside here. the bottom line is the macros are setting up mixed for mcdonald's this year. they're leaning into them with a stronger dollar than one would have expected a couple of months

ago. food inflation is not rising. that's a negative for mcdonald's. the franchise business can really get to work. >> yeah, they have said, they could do with a little bit of inflation. it wouldn't be so bad. how impressed were you by the numbers for the u.s. are premium wraps having anything to do with that? >> the numbers outperformed by about a point. the competition. their comparisons get easier starting in may. and those mcwraps are something they had to discount to get going. as they get to more full prized sales and the full price are around 3$3.99. as they get going with the actual price, they should reinflate the comp and may comparisons also get easier. so we except an acceleration. >> sounds like in europe, they

mentioned revisiting some of their value initiatives, looking at menu pricing. they may have to bring costs down even more in some of these areas of europe. >> yeah. the center of europe is tough. they continue to do well with russia and the the uk. but the mainland europe consumer, and we hear this from a variety of nationals. particularly southern europe is a real struggle. and the good news for mcdonald's, unlike five years ago or so, they have that price point locked up. the dollar menu here is going to help them get through this. not exciting for sure out of the european division. >> really quickly, david. stock is about 102. does it feel to you like there's limited upside here. >> the 110 scenario is still our scenario.

you have to keep in mind that the summer is the key season for them. the u.s. will have to do hero like lifting to make the upside scenario happen. >> we'll see if they can work that out. david, thanks a lot. >> thanks, carl. >> bells are about to sound across europe on another day with good macro data. back in two minutes. are you still sleeping? just wanted to check and make sure that we were on schedule.

the first technology of its kind... mom and dad, i have great news. is now providing answers families need. siemens. answers.

the european markets are closing now. >> not just the green on the map. it appears to look not so terrible. can you see greece on the bottom right hand corner up 6%. just wait for it to get in. there you go. around europe, we are tracking higher. you'll be aware yesterday ha the german market went into record territory. we're getting red territory here. despite the gains, and i'll come down to greece in a moment. it's not record territory across europe. so if we take the top 50 blue chips, where we are trading now is back to where we were in 2008. we still have all this amount to make up in europe. if you take the top 50 blue chips around europe, they were basically a lot of panning there. you know what's happened to the banks. just check out the difference as

the dow is in record territory and you'll stee the degree of the wealth destruction in europe that has not been made back, where you have here. so this is europe riding high before the financial crisis. this is now the dow riding high as a result of being able to climb back where the rest of europe is not able to. have a look at the greek bank stocks. it's a trade up over 20% some of them today. on the one hand, dow jones is they'll get the go ahead with $7.5 billion in cash which then comes back to recapitalize the banks. that produces what remains of them on the banks. the other thing is the journal is providing us they've been talking about greek bonds. they are suggesting you should

buy greek bonds because they're going to be a stable investment and a big interest rate coming through to the end of the year. look at the way in which those yields have declined recently. yields down, prices are up as people are buying, and saying you'll probably get 9.5% on them by the end of the year. the increase is really, really reduced. there will be no more restructuring after the original shareholders or debt holders lost 74%, 75% of their value, whatever it is. morgan stanley thinks this is a buy in the search for yield returning 9% or 10%, as a result of not having to, they say, further down the line, have any of those big moves any longer. >> yeah, a return on your money. let's get to rick santelli in chicago. a very special guest today.

and we definitely mean that. right, rick? >> oh, absolutely. before i ask our great esteemed guest a question, i would like to do a quick premer here. when it come os the obs vagss over the year with the fed and their strategy, he alwayses prefaces it with that it's his opinion. but he's a great american for speaking his mind and to that end, welcome mr. fisher. >> undeserving, but i'll take it. >> no, you definitely do deserve it. on the current state of the economy with regard to how many of the programs have faired with the fed, i would like to read a quote from the harvard club of new york city. nobody on the economy nor our sfafs of the board of governors and the 12 banksing a banks rea

what is holding back the economy. if they're not sure what is holding back the economy, why are we doing all these extraordinary programs and measures? >> well, that's a good question. we know, we all know monetary policy has been extremely a accommodati accommodative. and yet we were not seeing the transmission through the job creation. inflation is not an issue. it's neither destructive in terms of deflating. we're running less than 2 %. question, why are we getting job creation? i think we know the answer. i think we referred to it in a single sentence more forcefully in the last statement, which is fiscal policy. you cannot make decisions under conditions of total uncertainty. we have a massive fog here. our businesses are well structured from a financial

standpoint. stock prices are high. leverage has been reproduconstr. interest rates are at an all time low. question, why isn't it going to the economy? answer, i think, my opinion as you said earlier, is pretty clear. but i think it's clear to everybody now. we don't know what the spending will be. we don't know what the regulatory overload is going to be. we don't know what the cost of health care is going to be. so the fault lies with the fiscal authorities, i don't think you're going to see the kind of growth we would like to see. we are doing better than the rest. we're the best looking force in the group. but we could do better still. we have great potential as a country. it's not being realize because the politicians are holding us back. the most prevalent question i'm asked is about the exit. in the same speech in the fall, here's what you said regarding the exit. no central bank anywhere on the planet has the experience of

successfully navigating a return home from the place in which we now find ourselves. mr. fisher, i've thought that a million times. said it on the air a thousand times. what do you think is going to happen? is it going to be a voluntary exit they will try to craft? will it be a forced exit? give me your thoughts. >> somewhere we have to have practical limits as to where we can build the balance sheet. we're moving in the direction of a $4 trillion balance sheet. we know we can't go on forever. this has been an effort to juice the economy, and it's done its work. but the question is, what are the limits? so we know theoretically how we can exit. is it well articulated by the chairman and individuals of the community like me, et cetera. the real question is how to get it done. let me give you an example. in terms of flow basis, we're

getting close to buying up the to 90%, maybe a little more than 90% of new gross mortgage backed security issuance. we know it's easier to buy things. but when you go to sell, how are you going to handle it? do we sit on them? do we slow down and taper the rate of accumulation, which was headed in the last statement, which had a sentence that said from our most recent meeting we could increase or decrease the pace at which we by, depending on conditions in the labor markets and inflationary front. so i think before we talk about an exit, the question is do we continue the pattern of purchase of $85 billion a month that we're currently undergoing. >> real quickly, let me stop you right there. in your opinion, and i believe it's going to be involuntary. but if it is voluntary and we see a taper, do you think the taper will be in tune of tapering purchases of the mortgage securities or the treasury securities?

>> my own personal preference, and i can only speak for myself, would be in the mortgage backed securities. we had a rebound in housing. i think it's done its job. we're at risk of overkill. we're accumulating so much, what do we do with it? >> i'm going to have to stop you there again because i could talk to you for hours. but this is our last point. what does the number 24,180,856 mean to you, sir? >> population of texas. >> pardon? >> population of texas. >> one of your speeches, you said that the financial services committee of congress reckons that's how many hours it would take for agencies involved with dodd-frank regulation to actually implement it. you have not been a friend of

dodd frank. you have your own too big to fail solution that the dallas fed released. this number is pretty big. just finish off by telling us how ridiculous dodd frank is in your opinion. >> well, i think it's going to be reformed. there's a lot of movement on containing too big to fail. the problem is the purpose of the legislation has not been involved. you're seeing more discussion from several leaders in the federal reserve system from the fdic, tom and others, and we have our own proposal for dealing with too big to fail. it is moving the forward. you had a bill put forward by senator brown, and senate democrat vitter. this is a train in motion to correct and simplify how we deal with too big to fail. so i do think dodd-frank went way too far. it's way too complicated. that's the number of hours it will take to deal with the regulation being put forward.

and we're not finished yet. so there will be action on that front. the next step will be in june. we'll see how it goes from there. >> thank you. they're giving us more time. now talk about the subsidies that go to the top dozen banks at the expense of over 5,500 other banks. that subsidy is quantified by other wire houses, somewhere between 70 and $85 billion a year. do you agree with that? >> i don't know what the number is. the there are numbers all over the place. we have them for the bank. the bank of england has good work. the bloomberg number you just mentioned, there is a study now mandated by, again, senator brown and vitter to get the gao to give us a number. all i know is there is a number. it is positive. the 12 federal reserve banks are in the process of considering this themselves. we're likely to undertake a

study. the minneapolis fed and dallas reserve tried to wrap our arms around this. all i can tell you is, "a", it's there. "b", it's significant. and "c", it's fair. >> do you think it's possible with the efforts that these megabanks are putting forth in washington, do you think it's remotely possible we can put through the money trying to buy political favor with regard to keeping their megasubsidy? basically government protecting them? our own attorney general holder has said basically we can't control the too big to fail banks. >> yeah, they were too big to jail if they made mistakes. i do think it's possible. they were 1,000 community bankers in washington two weeks ago working on the congress people. this is the unfortunate part of our system, rick, with the big money pockets. they can buy and sell members of congress. and we don't want to see that happen. the issue is what is right. and i think it's in the hands of the community and regional bankers to make it clear.

all they want is a level playing field. you want american competition to go to work. you want to give everybody a chance for success. and that's what this is all about. i do think there will be progress on this front, and if not i would be horribly disappointed with our elected officials. >> it's been an honor. thank you for being our guest. >> awfully quiet trading floor an listening to him speak. mr. santelli, thank you very much. delta shares rallying on the news of the buyback and dividend. richard arounder son will join us for a first on cnbc interview when we come back. how do traders using technical analysis streamline their process? at fidelity, we do it by merging two tools into one. 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. ♪ [ male announcer ] the parking lot helps by letting us know who's coming. the carts keep everyone on the right track. the power tools introduce themselves. all the bits and bulbs keep themselves stocked. and the doors even handle the checkout so we can work on that thing that's stuck in the thing. [ female announcer ] today, cisco is connecting the internet of everything. so everyone goes home happy.

♪ ♪ the new blackberry z10 with blackberry hub and flick typing. built to keep you moving. see it in action at blackberry.com/z10

all right. coming up on a special edition of "halftime report" life in las vegas, we're getting the best ideas from some of the world's top investors. the man behind last year's best performing hedge fund tells us what he is trading today. he's going to share that with you. we're also going to talk to dr. dew himself in a cnbc exclusive

with his big call on the market. and what's the last great play on the housing recovery? another best performing hedge fund manager of last year joins us to share the ideas with you. carl, we're excited about the show. we'll see you in a few minutes. >> sounds like it was a great night last night. can't wait to hear more. thanks a lot. you may have heard already, delta announcing a dividend this morning. a rare move by an airline and investors seem to like it. stocks hitting a 52-week high. joining us is the ceo of delta airlines richard arounderson al with our own phil lebeau. richard, great to have you. >> hey, there. >> there's a lot who have tried to play this for a long time. they lost a lot of money. and they're wondering is this even possible what is happening today? >> well, it's real. it's an important day for delta. what we have done is come to a

sustainable business model that pulls off significant cash flow for the shareholders and our decision today to pay a dividend and begin a buyback program is real change of evidence in the industry. >> there's a lot of folks who say industry is still hugely exposed to overall economic trends. what happens if fuel prices really do spike. isn't this an easy casualty if things suddenly turn south again? >> well, the other important component of what we're doing is derisking our balance sheet. so in addition to the $1 billion return to share olders over the next three years, we're taking our net debt, which was $18 billion in 2008. it will be $10 billion this year, and we're taking it down to $7 billion, is now our new net debt target. so in addition to returning cash to shareholders, there's a very big piece here of continuing to derisk the business so the beta on our stock is much more attractive to long-term capital. >> hey, phil.

>> richard, phil lebeau here. i'm curious. in april you guys reported softness in terms of passenger revenue per available seat mile per traffic. and there's some concern out there that we might see a summer where we don't see robust growth in traffic and in passenger revenue, but we sort of see a plateau. how do you see things? >> well, phil, we're set up to have the most profitable year in delta's history in 2013. and the interesting phenomenon that we have now in the industry that played out in that quarter, while we did see some softness from overall economic issues around the world and the tax increase we had on consumers in the u.s., that also pushed down fuel prices. and the fuel price push down more than offset the weakness in reven revenue. so we have 6 to $800 million of goodness given fornt curves. >> you also announced along with

competitors you also raised the cancellation fee for people booking tickets up to $200, and there are more than a few critics out there saying is there a limit to how high you can go on the cancellation fees remember in our business is it's highly competitive. 24/7 through the internet. probably the most transparent consumer business in the world. all these decisions are market-based decisions based upon consumer demand patterns. the importance of what we did with the fees is to make certain that we have segmentation in our fair setting practices. we have some very low fares out there for consumers to travel on. and really the purpose behind our fees at delta is to make sure that those don't just roll and roll and roll. and in essence become walk-up fares. so it's a fair tedeal. what we're asking consumers to do is use tools at your disposal on the internet and plan your travel accordingly.

>> richard, just to hop on phil's point, what do you say to an investor who argues the dividend's great, fantastic, but what i'd really like is to check my bags for free again. >> well, those are two separate decisions, right. that doesn't have anything to do with the share buyback or the capital structure of the company. if you still look at airline pricing, including fees, since deregulation in 1982, they're still one of the best deals in the marketplace. and you can still travel. it's pretty amazing the levels of services we have at the safety level also we have and the convenience we brought to air travel. after all, we got to see the importance of air travel during the sequester. once the air travel system in the united states started to slow down, we got 100 votes in congress to make sure it continues to operate effectively. >> public officials are on that.

richard, thanks. i have a feeling we'll come back. thanks again. >> thanks. >> phil lebeau in chicago as well. some of the most famous hedge fund names gathering today. how will some of their ideas pan out? that conference gets under way. clients are always learning more to make their money do more. (ann) to help me plan my next move, i take scottrade's free, in-branch seminars... plus, their live webinars. i use daily market commentary to improve my strategy. and my local scottrade office guides my learning every step of the way. because they know i don't trade like everybody. i trade like me. i'm with scottrade. (announcer) scottrade... ranked "highest in customer loyalty for brokerage and investment companies."

welcome back to squawk on the street. coming to you live from the investment conference at lincoln center in new york city. we're just about to get under way. with an i have interesting roster of hedge fund managers today speaking. including david einhom bringing up the last speaking engagement of the day. i just spoke to some attendeeses who said they're looking at some details on the macro picture. chainos for instance has been outspoken about his bearish view on china. another person told me they're looking for some energy ideas. what's happening in the natural gas space in the view of some of these guys. there's no telling what they will speak about. leading off in just a moment is paul singer who is not known for making a lot of public appearances. i think this is his first public outing since davos.

singer of course some of his recent moves have included, well, not recent but for years he's been suing the republic of argentina to have them make good on a series of bonds that eliot bought. he's also encouraging a deal to go private with two private equity sponsors. and finally he's gone active, hoping he can get some new directors on the board and encourage them to separate some assets and create more shareholder value. >> we're about to see a bunch of headlines from where you're standing, kate. our kate kelly from lincoln center. still to come, remember this signature from jack lew? it has changed a little bit now that he is secretary of the treasury. ♪

[ agent smith ] i've found software that intrigues me. it appears it's an agent of good. ♪ [ agent smith ] ge software connects patients to nurses to the right machines while dramatically reducing waiting time. [ telephone ringing ] now a waiting room is just a room. [ static warbles ] [ telephone ringing ] and you wouldn't have room it any other way.e. room. but your erectile dysfunction - you know, that could be a question of blood flow. cialis tadalafil for daily use helps you be ready anytime the moment's right. you can be more confident in your ability to be ready. and the same cialis is the only daily ed tablet approved to treat ed and symptoms of bph, like needing to go frequently or urgently. tell your doctor about all your medical conditions and medications, and ask if your heart is healthy enough for sexual activity. do not take cialis if you take nitrates for chest pain, as this may cause an unsafe drop in blood pressure.

do not drink alcohol in excess with cialis. side effects may include headache, upset stomach, delayed backache or muscle ache. to avoid long-term injury, seek immediate medical help for an erection lasting more than four hours. if you have any sudden decrease or loss in hearing or vision, or if you have any allergic reactions such as rash, hives, swelling of the lips, tongue or throat, or difficulty breathing or swallowing, stop taking cialis and get medical help right away. ask your doctor about cialis for daily use and a 30-tablet free trial. the ocean gets warmer. the peruvian anchovy harvest suffers. it raises the price of fishmeal, cattle feed and beef. bny mellon turns insights like these into powerful investment strategies. for a university endowment. it funds a marine biologist... who studies the peruvian anchovy. invested in the world. bny mellon.

treasury secretary jack lew has taken some heat for this in the past. a little more than two monthses into the job, the secretary of the treasury signing documents with a different more legible john hancock. no words on whether that will be the official signature to appear on our currency. a treasury spokesperson simply saying stay tuned. down's hanging in there.

takes us to 1570. the s&p up almost 5 at 1630 as the rally continues to march on. let's get out to las vegas. a little bit early here, the "fast money" halftime. >> carl, thanks. welcome to a special edition of the halftime show. we're coming to you live today from the sky bridge alternatives conference in las vegas better known as salt. if you've ever wanted to get inside the mind and portfolios of some of the world's great investors, this is the place to do it. a few of the very best share some of their top ideas with all of you. here to help us navigate all of the big market news. we're grateful to have you us here in vegas. he is managing partner at the