morgan stanley today. >> did you really? >> i did. >> wow. what made you come around? >> joe terranova. >> and i liked td ameritrade's numbers retail. >> does it for us. don't forget to catch more of "fast" at 5:00. "power" starts right now. "halftime" is over. "power lunch" and the second half of the trading day start right now. >> moving target as the s&p zeros in on 1700, 1692 right now. are the strategists below that mark, and there are a lot of them. are they changing their forecast? a good report from wendy's and an even better burger. got to tell you. just had a bite of the new pretzel bacon cheeseburger. extraordinarily good. the ceo is here. he'll have the story behind the burger that has everyone in this newsroom talking right now. it is the pretzel bacon cheeseburger. good stuff. and the cost of college.

a new report is out on who is paying and how. the share of the bill the parents are putting up is dropping big-time. we'll tell you how people are making ends meet. first though to sue at the nyse. >> they are talking about that burger down here on the floor, ty, but we're going to talk about the s&p because right now, as you pointed out, the s&p, the dow and the nasdaq kind of a mixed performance. the s&p is down about 2.5 points, but the dow is up 21 and the nasdaq down 13 and the russell off just a fraction, but we want to focus on the s&p for just a minute. at the 1692 mark just shy of the 1700 mark. career to date that means the s&p is up a full 18%. if we cross 1,700, what does that mean for all of those wall street strategists who are way under that for the year-end targets? josh lipton and his team have been calling all the big firms out there and joins us live from hq. what have you been finding out, josh? >> hey there, sue. the s&p 500 nearing 1700, a big

filestone for a market already at record highs. the market, it has taken many by surprise, including wall street strategists, many of whom have already raised their year-end targets so where do some wall street pros stand right now? the bank of america, highest on the year-end list with a target of 1750 raised from 1600 on what is called diminished tail risk and then there's david kostin of goldman sachs, target is 1750 in six months pointing out retail investors have rebalanced their portfolios to a pro-equity minutes and andrew garthwaite started at 1550 and 1730. tom lee at jpmorgan began the year with a target of 1580 and now a target of 1715. likes the relative value stocks and anticipates a second half gdp acceleration. david bianco at 1675 and

citigroup at 1615 and say the market is dealing with tapering estimates that are too high and add am parker over at morgan stanley, began the yore at 1344 and now at 1600, and finally there's barry knapp of barclay's at 1525. he expects the market to sell off in waves as it has done in watched tightening cycles. back to you guys. >> josh, thank you very much. stay with us because kenny polcari and a cnbc market analyst and so is bob pisani. bob, let's start, first of all, with the targets and i went to segue into earnings season. if, indeed, we're near -- want to go to rick? okay. let's go to rick before we start the conversation. rick, you've got the auction results. >> yes, and i've been vacillating on the grades. b-minus, c-plus, but it's going to be a charlie plus. 35 billion two years, and, boy,

it wasn't a very choppy one-issue market, pretty tight, just like the ranges here. let go through the internals. where it went off the rails, 3.54, ten auction bid to cover. 3.54 chasing. every dollar of securities available for sale this. auction, 3.08. well, 3.05 and 3.04, the last two bid to covers because they have been drifting lower. that's key. we saw a slightly above average indirect at 30.4 and directs 16.4, six percentage points under average. 53.2% go to dealers. the rate, .336. that was very competitive, so charlie plus, it just seems the crowds aren't enormored with chase and the auctions. sue, back to you. >> ricky, thank you very much. back to s&p targets and earnings. kenny, if indeed we bump through this 1700 mark, that means for a lot of strategists they either

have to raise them or we were trending for the rest of the year. >> well, does it necessarily mean they have to raise them, or if we bump through now does it mean we'll stay through the end of the year? i'm of the belief that we hit 1700 and fail at least one or two times. we might pierce it but then i do think as the fed tapers, if in fact it's going to be september like so many believe, i do not, but so many believe, i think you'll see the market pull back. i don't think it forces people to have to raise the number if we just pierce it. >> any year to take the estimates with a grain of salt, this is it. >> right sdh when you start the year at 1550 and five months later you go 180 points on the dow, that shows you the long-term value, trying to guess this, is a very difficult proposition. with that said, q3 numbers doing develop. not dropping their numbers that much in the third quarter, and that's one of the reasons why

the markets are holding up so well. >> josh, what about china? the likes of caterpillar and some of the big industrial companies coming out with their earnings and china has a drop in their growth rate. does that change the dynamic for a number of those companies? >> well, i think you're right, sue. that's obviously a concern, the slowdown in china. you heard the premier in china suggesting they will work hard to keep that growth rate above 7%. some strategists like i mentioned, tobias levwicz of citi mentioning that as a reason why he's not raising the target. talked to the bulled up strategists. some say it comes down to the fact that they don't think this economy is outstanding or spectacular but do think it's resilient. they say earnings are better than expected. q3 guidance not looking too bad and maybe tapering isn't coming so soon. steve liesman, our colleague, knows the fed better than anybody and says a september tapener steve's opinion is just

50/50. >> a perfect segue because, ty, thatéw's something you'll talk about right now. a constant question, of course, for stocks is how strong is the economy? where is growth going, and our economics reporter steve liesman on what investors should trust more right now, job growth which is moving in a god direction and overall economic growth, not so much? >> this is a really important call here. maybe the next big macro trade, getting right which of the two data points has the economy right. domestic product tells the story of a weak and even weakening economy. take a look here, 3.1% back in the third quarter of 2012 and then below half a percent in the fourth quarter. straighten the bid in the first quarter, and then this is an estimate. i've seen higher estimates, an average of some of the economists that we follow again below 1%, but in the other corner jobs which have been relatively strong. you can see here pretty constant, up 2% in the second quarter or by more than 600,000 jobs while gdp weakened. in fact, job growth didn't weaken in the fourth quarter of last year when measured growth

fell below half a point. all of this raises the question of just what's going on here and what should investors believe, and equally important what does the fed believe? that's critical because the outlook for tapering tied to whether growth balances back in the third quarter and if job improvement continues. so far it seems the fed thinks that job strength is telling the better story and the growth numbers could follow along or be revised. the bulls cite the split between the two measures of the overall economy, the value of everything we produce. that's gdp and the value of everything that we earn, gross domestic income or gdi. this measure a bit more robust than gdp mentioned last week by fed chair ben bernanke as a reason to think that maybe the economy was not quite as weak as it appeared. the bulls also cite jobless claims. they have remained right around that 350,000 levels for two months now with the four-week moving average and that's a reason to believe job growth is not on the verge of deteriorating. we want answers. you got answers. claims come out thursday.

next week secondsecond-quarter d along with revisions and economists are looking for 180,000 jobs in july. >> you would think the jobs growth would pretty much track economic growth. >> right. >> how unusual to have this kind of disconnect? >> not terribly unusual, over a quarter to quarter basis, over the year there's a well established relationship between job growth and overall economic growth, but right now we've got a divergins here, and we have a divergence with the fed on the cusp of a policy change and that's what makes this a perilous call for investors. >> steve liesman, thanks very much. >> sue, down to you. >> gentlemen, we're keeping a very close eye on dell. shares right now are down almost a full percent. this ahead of that big buyout vote tomorrow. activist investor carl icahn urging dell shareholders to reject founder michael dell's deal and calling on dell's board to move quickly if michael dell's offer is defeated.

the "wall street journal" reporting michael dell is personally meeting with big stockholders ahead of that shareholder vote coming up tomorrow. and dow member united technologies hitting new all-time highs today. the industrial giant reporting better than expected results, raising the lower end of its full-year forecast. right now the shares are up 2.66%. different story for traveler, the biggest loser in the dow, beating bottom line estimates and missing revenue forecasts and it's down better than 3%. altria shares down by 2.5%. the tobacco producer missing top and bottom line estimates. however, the company is raising its lower end of its full-year guidance. ty? >> all right. a stock i always like to talk about, her is his, sue, hitting a new all-time high. let's take a look. $93.60. citi adding it saying hershey's

showing strength through its deep portfolio of brand, deep dark chocolate portfolio. raising hershey estimates and earnings estimates as well as the company's share price target to 110 from 100. the stock is up 30% this year. that's a lot of almonds, baby. wendy's bringing moment bacon in the second quarter, making plans now to sell 425 restaurants to franchisees. the stock booming today, up 12%. 65% in a year. they are happy about that out in dublin, ohio. excluding one-time items, the number two hamburger chain earned eight cents per share last quarter, two cents hour than wall street estimates and five cents more than last year. revenue up 651 million versus 646 million a year ago, and first on "power lunch" wendy's ceo emile broelic. welcome, good to see you. >> thank you, tyler.

>> congratulations on a very nice quarter for you. you've done a variety of things today with your earnings announcement and corporate plans. let's start with the sale of 425 of your o & o restaurant. how does that help you going forward? >> well, you know, tyler, we're constantly looking at how we evalve our brand proposition and constantly looking at how we evolve our economic model, and we think this helps us. it's going to encourage franchisees to activate restaurants more quickly. it's going to give our brand a more stable flow of revenues in terms of rental income and royalty income. it will allow us to take up our earnings per share guidance so we're very excited about it. >> when you say activate, what do you mean by that, that's a term of art i'm not familiar with. >> sure. we're in the process of upgrading the image of our restaurants across our entire restaurant system, and we're going to do about 100 company

restaurants this year, about 100 franchise restaurants this year and then take that up to 200 for each company and franchise next year, and as part of these process of selling these restaurants, as part of the agreements in selling to restaurants, we will require a certain level of image activation so we're very excited about it. >> tell me also about the increase in the dividend. it's a 25% increase, though it's only a penny, but 25% is 25%, and the fact that you're now going to begin to buy back stock. you've been authorized to do that before. you haven't in the first half of the year. you're going to start now. why? >> well, you know, we think both the dividend and the share buyback are a way to return, you know, value to our shareholders, and as we look to the future, we believe that we'll examine this opportunity every year, assuming we make progress as we've stated that we believe that we can and ask our board to approve initiatives like this, and we

think that they have a very important role in our ability to produce earnings per share, growth in the mid-teens going forward. >> and that would be for 2014. you put earnings per share in the mid-teens. you say you're trending for 2013 towards the high end of your previously indcrate eicated ran that right? >> we're trending towards the high range of ebitda and share guidance of 20 to 22 cents and trading toward the high end of that. >> now the noise you're going to hear here, mr. brolick, as i open up the pretzel bacon cheeseburger. i've had one, it's an extraordinarily good hamburger. tell me about how important a new product launch like this and is this a limited time only product so it has a shelf life of a few months? forgive me here, while i have a boyte. >> it is a limited time only product, and i'm jealous i don't

have one. please do enjoy it. >> it's really good. >> it's very important to us, but, you know, this is not a one-hit wonder. we have a marketing calendar for the remainder of the year that has other product innovation in it and even out to next year, our product pipeline is very rich and full, and we're very excited about it. wendy's historically has been known for product innovation, and we want to really regain our stature there and we think a product like this definitely puts us on a start to that road. >> it is a very, very, very good hamburger. emil brolick, thanks for being with us here today. continued good luck. >> i'll take it over because you need to eat the hamburgy. same with food, domino's pizza beating the street and they are, however, down right now 4%. profits rose 18% from a year ago thanks to strong global sales.

revenue rose 10%. the stock is up some 45% this year. domino's ceo patrick doyle is on "mad money" with jim tonight. that's at 6:00 p.m. and 11:00 p.m. eastern time. also on the food front, not to be left out, jw schmucker hitting be a all-time high today. up .66%. taco bell is dropping kids meals and toys at its u.s. restaurants. the fast food giant says it's the first in the industry to make that movement individual menu items including the crunchy taco, the soft taco and bean burrito will now appear on the regular menu. shares of the parent company is yum brands, and they are down 1.5% at 70.43. ty, back up to you. >> i'm supposed to go over here. what are we doing now, john? >> all right. let me take it then. three big questions for phil lebeau who covers autos an airlines. number one, phil, what do detroit's problems mean for the big three and number two, ford announcing some hiring. you're going to tell us why and

number three, phil, what happened at laguardia? >> wow, sue, still trying to figure that out but the footage, you've got to see this. take a look at hard landing yesterday by southwest airlines at laguardia airport. nobody was seriously hurt, but a lot of people very scared. more "power lunch" in two minutes. with the spark miles card from capital one, bjorn earns unlimited rewards for his small business. take these bags to room 12 please. [ garth ] bjorn's small business earns double miles on every purchase every day. produce delivery. [ bjorn ] just put it on my spark card. [ garth ] why settle for less? ahh, oh! [ garth ] great businesses deserve unlimited rewards. here's your wake up call. [ male announcer ] get the spark business card from capital one and earn unlimited rewards. choose double miles or 2% cash back on every purchase every day. what's in your wallet? [ crows ] now where's the snooze button?

ford is revving up its

hiring, shares down just a fraction. about .66 of a percent. phil lebeau is live in chicago. where are they doing the hireing? >> primarily in dearborn, and not surprising given the fact that they are expanding their vehicle development. they will be hiring an additional 700 white collared salaried workers. expanding vehicle development work and focusing on next generation technologies. take a look at how much they have grown their global workhorse. he had to downsize this company, a bloated company. got down to 158,000 and now up 10.7% to 175,000, and, remember, ford is going to be reporting its earnings tomorrow morning, and sue and tyler, a big focus of those earnings, north america. many are saying it's going to be a blowout quarter perhaps with 2.3 billion in profits. big numbers expected from ford

tomorrow morning. >> you know, phil, can we switch gears a little bit and talk about detroit's bankruptcy filing. what, if anything, does it moan and what impact might it have on the big three automakers? >> obvious lire they are concerned. never good to have a major city by your headquarters go bankrupt, but at the same time there's a team talent pool in the detroit area, and when i've talked with executives in and around the detroit area, almost all of them say the same thing, listen, enough talent in this area that we'll continue to hire and that's borne out by the number of executives they have brought into these companies, whether at gm and downtown detroit and ford at dearborn and chrysler's headquarters out in auburn hills. so they will continue to hire and attract talent so they are not happy to see detroit go bankrupt. >> obviously not. certainly no one is. let's talk about the airline accident yesterday at laguardia in new york. what's the latest on the southwest incident? it was a collapsed landing gear. this video is just unbelievable,

phil. >> yeah. >> what is southwest saying, and is this an isolated incident? >> at this point they are trying to figure out why the landing gear did not function because there was no indication to the pilot, to anybody, that the landing gear would not function as it was supposed, to so they are investigating that at this point. they finally cleared it from the runway. remember, laguardia had massive delays. >> oh, yeah. >> last night it was closed for a while, sue. using one runway this morning, and now they have got both of them up and functioning. finally working through the delays. it's going to take some time but you can be sure that they will figure out exactly why that landing gear was not working, tapped gave no indication it would malfunction. >> that's the most disturbing part because, you know, the pilots can't -- can't prep the cabin for that. >> absolutely. >> phil, thank you so much. i know you'll be working that story for us. phil lebeau, ty, up to you. >> amazing to see how that aircraft tilted forward on its nose as it came down with

obviously flames as the friction, as the nose hit the runway. defense sector hitting a record for the fourth straight day. big numbers on housing as well. diana olick in the house and jane wells all over these stories. >> spring apparently did sprung, if you can say it that way for housing. what's ahead for the next half of the year? we'll have the numbers. jane? >> diana, what sequester? lockheed surprises the street and maybe even itself. we'll have those numbers after the break. golden opportunity sat and experience the connectivity of the available lexus enform, including the es and rx. ♪ this is the pursuit of perfection. [ agent smith ] i've found software that intrigues me. it appears it's an agent of good. ♪ [ agent smith ] ge software connects patients

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new clues about the health of housing. looks like this year's spring selling season is one of the hottest in years. diana olick, her son just won the district little league championship. you'd much rather talk about that. >> much rather. go d.c., but on to housing, of course, a slow start at the beginning of the year. home values jumped, and the housing recovery took a more solid footing nationwide, according to a new report from zillow. prices up 5.8% and up 2.4% from q1. let's go local. markets in parts of the northeast, midwest and southeast that had been slow to bounce back, finally started to move. of course, the biggest jumps continue to be in the west with the highest appreciation rates in sacramento and riverside, california, as well as in phoenix. on the rental side. national rents fell in request2,

the first quarterly decline after nine consecutive quarters, either increasing or staying flat. rents are still up 1.6% from a rear ago. this spring surge comes as a warning as different toips of buyers enter and exiter the market. the landscape will change. what we're talking about is investors. they pushed prices up so high in some markets that they have priced themselves out of the equation. move-up buyers are coming back and rely on mortgages and also need something to move to. tight inventory continues to be the number one negative in this recovery. tyler. >> diana, thanks so much. four days, four records for the defense sector. today lockheed martin hit a new 52-week high as profits jumped 10% from a year ago. that was better than wall street estimates. the stock is up about 30% this year. jane wells is covering the story for us in l.a. >> hey, ty, the street expect the lockheed martin profits to jump, but as you say they were up 10% and the company raised full-year guidance.

the stock took off like a rocket or a missile. a lot of the credit for the surprise goes to missiles and fire control sales. lockheed shares hits a new 52-week high and earnings per share were 264. the top loin did fall half a billion from a year ago but still came in better than expected and cash from operations fell 25% and the company raised full-year earnings to between 9.20 and 9.50 a share, the street expecting 9 even. sequester, so far not impacting lockheed's cash cow, the f-35 or really anything. while the pentagon supports the fighter, how much money it will have to spend on it is still unclear. >> in terms of any impact that we might see, it will be back filled by international opportunities because you can see that's where we'll ramp up. over the next five years, close to 50% of our orders will come from the international

customers. >> lockheed is in the middle of completing negotiations for the next two lots of f-35s expected to close in the current quarter. the aircraft represents 15% of total sales and the ripple effect, the rocky report, philadelphia defense sector index at an all-time high. sue, we've got a lot more defense earnings coming out later this week. >> i know you'll be very busy, miss jane. thank you so much. gold hovering at a one-month high. prices are closing right now. maybe a little bit of profit-taking there. sharon epperson tracking the action for us over at the nymex. hi, sharon. >> hi, sue, seeing a bit of profit-taking but just a little bit after we saw the tremendous run-up in gold prices in the previous session. not able to see that same type of momentum sustained today but traders say a close above 1325 is still very supportive for gold. we've seen gold prices that have really been on a tear the last two weeks or so and this is perhaps going to be maintained if we see gold prices going

towards that 1350 level, the key technical level traders are watching next. looking at what's happening in the copper markets, bucking the trend and seeing more positive territory in this session. a lot pointing to the comments from the chinese premier about the economy and how it will not allow it to slip too far as a reason for copper prices getting a bit of a boost. back to you. >> thanks, sharon. let's get to the trading action. a very busy bob pisani hanging up with a source here on post 9. >> what's interesting, diana was mentioning how well some of the aerospace companies are doing, lockheed martin. the whole aerospace sector is on fire so bea systems, put that up, a new historic high on that, another reason why we've got the philadelphia defense index at new highs. raise guidance. at an historic high and beat expectations and right across the board the aerospace

technologies is doing strong. great numbers on aerospace as well as otis elevator so this industry is doing very well. economically sensitive stocks, commodity stocks doing better, better than expected earnings from freeport-being moran. freeport a good number and dupont pretty well. weaker u.s. dollar all helping these companies, of course, right now. the important thing is i think most of these companies are saying things will get better in the second half of the year. ellen coleman, very typical comment. expect they will be significantly better than last year's second half, one of the reasons the market is holding up so well because we're not getting dramatic drops on estimates. big ipo, phillips 66 partners, essentially a spinoff from the ole phillips 66 oil pipelines. this was $23, an ipo. the price stock was 19 to 21. priced to 23 and is now at $30. you can see the demand for the oil and gas pipelines have been

huge. most of them throw off very nice dividends as well. >> up almost 31% in its first day of trading. >> yeah. >> bob, thank you very much. >> all eyes are on the nasdaq when this afternoon apple will get ready to report its earnings after the bell. seema mody is there for us today. hi, seema. >> anticipation is definitely building ahead of apple's report. the street expecting a 21% drop in quarterly earnings which would be the largest drop in its earnings per share since 2004, and that's primarily due to heightened competition in the smartphone space. morningstar analyst brian colello is interested in the hint of some product launches. what's the big question, what's the new products that apple has up its sleeve that could offset the losses associated with the iphone. another reason we care with apple so much is because of its weighting. without them the future earnings estimate would be 4%, and the s&p tech sector's estimate would

be negative 2% instead of negative 5.5%. switching focus to apple suppliers, texas instruments reporting upbeat earnings and take a look at broadcom, ubs analysts telling me shares may be moving lower in response to texas instruments announcement last night that it's licensing its connectivity business to a customer. back over to you, sue. >> very interesting. appreciate it. to the bond market where rick selly is there as usual, and he's tracking the auction -- post-auction. i'm trying to say tracking the action post-auction but it came out backwards toe sake it away. >> you know, backwards or forwards today in the treasury market there isn't a lot of huge action. maybe the most significant issue happened before we really got up this morning. that was the fact that we continue to hold this kind of 2.48 area. that's been the setman two sessions in a row, friday and monday. as you see on the 24-hour chart.

elevated a bit but well within its recent range and the auction at 1:00 eastern didn't give too much volatility. look at dollar index. it took a hit around 10:00 eastern. if you look at the euro currency, that was the beneficiary. why? because they had their advanced july consumer confidence release, and it was minus 17.4. that's good news. they are expecting a bigger negative number. sue, back to you. >> thank you very much, rick. >> let's take a look at lexmark shares. they have been soaring, right now up about 10% or so and the earnings at the print-maker more than doubled from a year ago because of a one-time gain from the sale of its ink jet business. capital source shares at new highs. the bank being bought by pack west bank corp for about $2.3 billion in cash. ty? >> sue, the quarterback for the green bay packers, i know they are your team, just bet his whole salary in a tweet and lost, so now what's aaron

rodgers going to do? we'll tell you the story coming up. plus, new members -- new numbers on the cost of college and who is now paying the bill. and talk about a diamond in the rough. one of the most famous bond cars ever being auctioned, you won't believe how it was found and how much it's going for. and a modern day real life take on "jonah and the whale." that's what it is coming up next. in a world that's changing faster than ever, we believe outshining the competition tomorrow requires challenging your business inside and out today. at cognizant, we help forward-looking companies run better and run different - to give your customers every reason to keep looking for you. so if you're ready to see opportunities and see them through, we say: let's get to work. because the future belongs to those who challenge the present.

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take a look at this. a diver off the coast of california nearly gets swallowed by a humpback while in one gulp. i can't speak for the whale. look at that. the diver was in the water. the well was doing what whales do and eating plankton or crabby patties or whatever. and the man literally almost wound up in the whale. the gulls are just waiting to see what happens. we got some good video. everybody is okay. everybody is fine. man is good, video is good. sue, down two. >> did you see how fast that diver got out of that water? i mean, can you believe that?

>> man. >> talk about a close call. a whale of a story to tell. the cost of college, a whale of an expense and now getting word that parents are shelling out less money to pay that big bill. music to some parents' years these days. >> one way of looking at it. a new stud fry from sally mae, look at how parents and students are paying for the cost of college. here's the headline. families are spending less. the peak was in 2010 when the average cost was just over $24,000 a year. that's now down to about 21,000 for the 2013 academic year that just ended. families are spending less because of income and budget restraints and the choices they are making to pay for college. 25% of parents are working more

hours. 47% of students are also working more. 57% of students are choosing to live at home to help cut the cost of college. how are the college bills actually getting paid? >> families, both students -- >> grants and scholarships 30%, parent income and savings 27% and student borrowing 18%. >> families, both students and parents, are approaching the investment in college through a comfort consciousness lens that we didn't really see before the recession. >> the recently graduated class of 2013 got their diplomas, and on average racked up just over $35,000 in loan debt. just in the last hour education secretary arony duncan on a conference call with supporters announcing a non-partisan plan working its way through the senate to keep interest rates low on the most popular government student loan programs. sue? >> hampton, thank you very much, appreciate it.

in today's yahoo! finance question of the day we ask with parents now paying an average of 27% of tuition down from 36, what's your strategy. 27% say investing in a 529 plan, 20% say saving in cash, and 19% say relying on those loans and scholarships. 34% say they are on their own. ty? >> all right, sue, the s.e.c.'s former top cop joining a law firm and getting paid many millions. another case of the revolving door between government and the private sector. should we be concerned about it? how so? and how much? plus, many lawyers are being let go in this economy, and many firms are going under. law and disorder next. if you're serious about taking your trading to a higher level, tdd#: 1-800-345-2550 then schwab is the place to trade. tdd#: 1-800-345-2550 call 1-888-284-9410 or visit schwab.com/trading to tdd#: 1-800-345-2550 learn how you can earn up to 300 commission-free online trades tdd#: 1-800-345-2550 for six months with qualifying net deposits. tdd#: 1-800-345-2550

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former s.e.c. director joining the corporate law firm kirkland & ellis reportingly getting $5 million a year as a partner at that firm. is this another case of a revolving door between the government and private sector in washington and a big article in the new republic today about the end of the golden age for the big american law firm. two things to talk about, and we have the editor at "above the law" and cnbc.com net net editor john carney, both former lawyers and both know each other very well so nice to reunite you guys on tv. >> good to see you. >> nice to see you, john. >> john, let me start with you. the revolving door. we've known that it's been in existence for a long time. >> look. i don't think this is as big of a deal as people think. there's been studies that actually looked at whether s.e.c. guys who later on go in to work for the big wall street law firms, whether they are easier or harder on the companies that they end up representing, and they are not

easier, as it turns out and actually probably a very good reason for this, because if the s.e.c. is tough on these firms, and on these financial companies that they end up representing, then they have to hire these guys. so in a weird way it might actually be a benefit that these guys end up going to work for them because they have an incentive to make the rules as tough as possible so that they later on have to hire s.e.c. guys. >> what do you think, ellie, do you agree? >> i would agree and would point out these laws are extremely complicated there. aren't 1,000 people in the world that actually understand what's going on here so any time you have the institutional memory of a top s.e.c. enforcement chief, you want to kind of keep that in the institution, right, as opposed to losing that, so that's why these guys can demand such a high premium when they go into the private sector. they know what they are doing. >> you know, what about the appearance, john, of a conflict of interest especially at this time? >> i would actually point out that for years and years what's happened here is that he's

actually given up a lot of money, if he was in the private sector for all these years he'd be making more than 5 million a year so net net as we say on my website. >> shameless plug. >> coming out behind at $5 million is not that much money for a lawyer at his level. >> the appearance we need is the appearance of competency. we need the appearance that the people who are actually regulating and the people who are talking to the regulators actually know what they are doing, and i think that's what you get when you have a guy who goes from the s.e.c. like kirkland ellis or one that goes from a firm of that stature as mary jo white went from my firm to the s.e.c. >> ellie, i'll stay with you for this, the report or perception and some of the reporting that's been going on about the demise of the big law firm and that people need to rethink whether or not the law degree eventually pays off. >> hey, man, if you're not making rain, then you're not going to shine. i think that's really the lesson

of the new economy, right? i think when you talk about lawyers being pushed out, especially at the partner level being pushed out, what we're seeing is the demise of what we used to call the service partner, you know, the person who was really kind of an expert but maybe didn't have the client contacts, didn't have the great golf game, didn't know all the things that you need to know to get to make that rain and get that business, and those guys are being pushed out. it's no longer good enough to be the best lawyer. have you to be the best at generating business if you're going to be a partner at one of these major law firms in. >> is that what it's about, john? >> i think the entire law firm mod sell broken and deeply broken. i think the inability for young lawyers to get jobs is just the beginning of this. i think what we're going to see is law firms be broken up. many more are going to fail and we're going to phase out of this system where only partners can own law officials. we'll see combinations of accounting firms and see combinations of different kinds of business models running law firms. there will have to be legal changes for that to happen.

>> right. >> but the old-style law firm, the kind that i came from and the kind that ellie came from that's over. >> the pin stripe corporate lawyer. >> i did it for years and years, and i'll tell you i'm so much happier outside of law and even when i quit being a lawyer seven years ago, there were so many miserable inside of law firms. >> i think what's going to happen right now is really that we're going to see two tiers, we'll see one tier of the kind of traditional of lawyer like canadian, a lawyer like me who goes to a top school and goes to one of the firms and still has a relative chance of being one of these partiers, at one of these great shops, then you'll see another tier of lawyers, i think, not making these kinds of salaries that are not living in manhattan or chicago or whatever and really working in smaller environments, more kind of like the outsourcing model that we see in other places. >> very quickly, would you,

ellie, recommend, that somebody go to law school? >> no. >> okay. >> the top schools in the country. >> don't go to the top schools in the country unless you can go for free, if you can somehow get a scholarship. they do public service scholarships at my old university, the university of pennsylvania law school, if you can go for free go. don't go into debt to go to law school. it's dangerous for your life. >> world needs plenty of plumbers, let's remember that. >> there you go. >> or bloggers. >> or bloggers, right. >> thanks very much. >> fascinating conversation, sue. appreciate t.green bay packers quarterback aaron rodgers just bet his entire year's salary and lost. we'll talk about that, plus the iconic 007 bond car up for, a. it's all in the power rundown, next. [ shapiro ] at legalzoom, you can take care of virtually all your important legal matters in just minutes.

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we're waiting for the e-trade baby to come out in london. if they do, we'll go there realtime. has apple lost its luster, its

mojo, robert? >> i was looking at the numbers, and their share of the smartphone market has fallen from 17% versus samsung's 33%. they have half their share, and the share of the tablet market is down to 40%, so, you know, they have got a long road ahead of them if they are going to make up that lost ground. got to be a bigger product. >> they need some new juice. >> they do, and investors keep lowering the bar and even the beat is not beat the earnings per share, shrinking by the quarter and the bar is very low for them to put out the so-called bait. >> keep seeing new stories about them coming out in something that they do and that's a bigger screen phone because bigger screen i think is where they are losing some of that competitive edge against samsung, htc and others. let's move on to a very curious story about green bay quarterback aaron rodgers, one of the best players in the nfl. made a big bet with a twitter follower and lost. he put his entire 2013 salary on

his friend ryan braun being clean. the milwaukee brewers outfielder has since been suspended for 65 games for drug violations. kayla, does rodgers have any alternative other than pay up? >> look, i'm biased because i'm a green bay packers shareholder, probably the worst investment, doesn't pay dividend or do a whole lot for me but i do love the packers. i hope rodgers doesn't have to give away a salary, but when you make a bet like this, tree falls in the forest. >> two rules of thumb, never bet your salary or anything and never bet your salary on a professional athlete being clean of p.e.d.s. >> exactly. he didn't say with salary. it could have been his salary from book sales, for instance. >> okay. >> there's little room out of this one. >> robert is consulting his

available for hire. >> that was dumb. >> that was d-u-m. >> diamond in the rough, one of the most famous bond cars from the film in 1977 "the spy who loved me" going on auction this fall. how was it found? in 1989 a long island man bought a storage unit, buy a lot of storage units on long island, never know what you're going to find and sight unseen and this was inside. >> what happened? >> pout it for $100. went back the next day, a pile of plankets, uncovered it and even then he didn't know what he had because he had never seen a james bond movie. only when he put it on his truck and brought it home and said you have james bond's car and could sell for $1 million, maybe $2 million. this guy's life is going to change after he sells the car and in my mind this is the best james bond car. >> what sort of lottery ticket is this. i mean, who buys a storage unit sight unseen. >> "storage wars," it's a

reality show. >> that's so bizarre. who says i'm going to buy this for $100, and it's like "the price is right," the boat, the trip and door number three and get what's behind door number three. i'd say he did pretty well. >> high wife's family lives on lock island, found a new business, will buy storage units and flip them. that will be aaron rodgers on line two for you. the biggest winners in today's trading, and maybe the baby in london. ♪

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steady as she goes for the dow jones industrial average, up 39 points, a little bit of a decline in the s&p, just a fraction of a percent right now, and the nasdaq is off a quarter of a percent because apple is coming out with its earnings after the bell today and everybody is kind of holding their breath to see what the bottom line is for apple. biggest winners today, leathernecks mar, hologic, united technologies and texas instruments, all with significant percentage gains led by lexmark up better than 7%. very interesting market. some earnings coming in better than expected. a couple of disappointments here or there, but very interesting to see what caterpillar announces given the news out of

china with its growth rate. going to be very fascinating. >> what show gives you cheddar bacon pretzel burgers, man-eating whales, lawyers fighting and aaron rodgers' contract and big bet. that's "power lunch," and that's "power lunch" for today. >> "street signs" begins right now. we'll see you tomorrow. apple earnings out tonight. the world is going to be watching them like a royal baby, but do apple even matter to the market anymore? do earnings even matter. it's a huge debate. we're going to dig n.speaking of digging in, can junk food save the world and solve the obesity crisis. it just might. we'll tell you why, and why you may want to move to detroit and why i think maybe one big bank should move. hi, everybody, happy tuesday, lots of cool stuff on the show today. let us start though by doing what we do best,