"it's never been done before" simply becomes consider it solved. emerson. ♪ janet yellen speaks and stocks take off. so what's all this talk about the stock market being rigged, mandy? hello, folks. that hot debate and maybe why you should not care. could sub-$3 gas really be on the way? and the most boring but maybe the most profitable headline that you will hear all week. it's the best day for stocks in exactly two weeks but the big story today is the best-selling author michael lewis saying on "60 minutes" last night that the

stock market is rigged by a gang of high frequency traders, stock exchanges and wall street firms. it makes for a really nice headline but what's the reality here? bob pisani at the nyse, give us the reality. >> well, look, michael lewis made some very, very bold comments on "60 minutes" last night. let's go right to it. here's the quotes heard round the world. >> the stock market's rigged. the united states stock market, the most iconic market in global capitalism is rigged. >> by whom? >> by a combination of the stock exchanges, the big wall street banks and high frequency traders. >> that's a pretty bold statement. a cabal of individuals and firms are rigging the stock market. look, guys, you and i, all of us at cnbc have had problems with high frequency trading. we talked about it for awhile. but as a general principle, there's a couple things almost everybody agrees on. the first one is information should be available to all participants at the same time. that's a principle of fairness.

the other ones, i keep talking about this, nobody else does, the regulators don't have tools that are adequate enough to understand what the markets are doing. we need to give them more tools to understand what's exactly happening. these are general principles to go by. but to claim that the whole market is rigged and the implication, guys, being that it's not safe for people to invest in the stock market because that's the implication, that is a gross exaggeration. i think very unfortunate. look at ibm. want to buy ibm? you might get high frequency traders trying to step in between you and trying to instead of you buying at $193.50 they will try to sell it at $193.51. i'm not happy about that but is that a reason for people not to invest or to say the market's rigged? i don't think so. i think it's unfortunate he chose those kinds of words. guys? >> stick around and join the conversation. i would also like to bring in the huntington fund's peter sorrentinno. do you think the retail investor should care about this? >> i think they need to be aware of it. i think if you are an investor, if you've done your home work, the price is important on two days, the day you buy and the

day you sell. if you've done your homework, you are comfortable with both those numbers. if you lose a couple pennies one way or the other, that shouldn't really be driving your investment decision. >> know what i find a little ironic about today especially, just because the headlines, i agree with bob pisani, of course, because the guy knows so much about it. we have these pipes, these fiberoptic lines, you can basically buy special access with, but here's the thing. janet yellen says one word extraordinary and stocks soar. you want to talk about a rigged market. where does the federal reserve play in all this? >> well, that's a good point. they are the only ones that can get away with price fixing and not go to jail. the rest of us, that's against the law. from that perspective, yeah, the fed is the ultimate market influencer. but to the point about -- mike has done excellent work. his work is spot on. but i do have to take exception with really the crux of what he was trying to say. if you're day trading against these guys, you will get crushed beneath their wheels. if you are an investor and truly interested in profit for the

long run, the warren buffett approach, then this is noise. it really makes for great entertainment but it really should not be central in your mind in terms of investment making decisions. >> the other thing is, you might say as a retail investor this high frequency trading really just doesn't feel very fair but at the same time, it doesn't necessarily mean the regulators are going to do anything about it. maybe they wouldn't do anything about it unless we had a really bad market and suddenly hft becomes the scapegoat again. >> very good point. i guarantee you if we had a drop in the market of 10% over a very short period of time, they will get all the blame, not fundamental problems, not issues like that. look, i have problems with high frequency trading in some circumstances, for example, there are too many places to trade. there are too many quirks in the market structure that i would like to see improve. i have a little laundry list of stuff i would like to do. but to go out and claim it's somehow rigged and that individuals may not feel safe in the market, i don't think that does anything for confidence. >> i'll tell you, just to jump on top of that, nobody is

defending high frequency trading. >> that's right. >> we need to be very clear about this. the rothchilds had an army of men on horses that got news back about waterloo. reuters with the pigeon service. you had the first guys with the stock ticker. somebody will always be ahead of the game. it's just the technology and type of sort of advantage that changes. >> and that is not to make an excuse for people. if there are individual traders, high frequency or otherwise, that are engaging in practices that are abusive or manipulative in the market, and i have had concerns in some circumstances, then they should be investigated, fined and/or imprisoned, gone after, but the whole generalization that the entire system itself is rigged and therefore unsafe for anyone to invest in, i just have a problem with that. >> indeed. bob and peter, thank you very much for joining us. we've got a programming note that the author we have been talking about, michael lewis, will be the special guest on "power lunch" tomorrow.

i also believe that the iex ceo, which is trying to find a solution to all of this, will be on as well. >> should be a big interview. i will be sure to tune in since i will be here. file this under boring but important. bonds are back, baby. take a look at this stat from our pal paul hickey. over the past year, stocks trounced treasuries. we know that. but the past quarter has been a very different story. the total return of treasuries trouncing sexier stocks. let's bring in zane brown. most of our viewers probably are not deep into the bond market themselves. they can buy a share of ibm a lot easier than they can buy an ibm 2021 note yielding 1.5% or a treasury bond. how long will this mini bond rally last, do you think? >> well, i think you are likely to see at least first quarter far greater performance in things like high yield and the municipal market. but i think stocks are likely to surpass bonds over the balance of the year.

we are likely to get a little bit stronger economic growth. that will support the stock side. it won't do anything to help high quality bonds. i still think high yielding bonds as lower quality bonds are likely to do pretty well over the balance of the year but still, not as well as stocks. >> what about the muni market, brian mentioned it briefly. it's a $3.7 trillion market, off to a stronger start in five years. what's your outlook for the remainder of the year on the muni market? >> i still think we'll have a great second quarter. i think a lot of people have yet to realize that not only are they at a higher marginal bracket but that 3.8% health care tax, that influences other nonmunicipal or non-tax free investments as well. once they realize they gain that benefit from municipals, suddenly the pre-tax equivalent of municipal yields look so much better. if you have a 3% municipal yield at the marginal tax bracket plus that 3.8% health care tax, it's like getting 5.25 or more which is really a junk bond yield on the taxable side.

i think there is some real value left in municipals, but even with that, i would still suggest or we would still suggest that stronger growth is likely to favor stocks over the next three quarters of the year. >> we shouldn't get all excited about the bond market. we were really excited to get excited about bonds, because it's all been about five years since we've had that opportunity. >> bonds, especially high yield bonds, have been there year in and year out. we've had close to double digit returns, if not double digit returns. we will still have kind of a high single digit return this year. it's not a bad place to keep some of your money. you don't want it all in a very volatile investment. but i think we would still shy away from longer term. i think the tapering on the part of the fed will eventually take its toll and you will have higher yields and lower prices on things like ten year treasuries. >> we have to leave it there. thank you so much for joining

us. just because bonds have been doing well this past quarter, it does not mean that all bond funds have. in fact, the world's biggest bond fund is on track to end the first quarter trailing 87% of its peers. the $236 billion fund has had a return of about 1.25% this year which is well below the 2% return on the benchmark bond index. well, two out of three isn't bad. as it stands right now, the s&p 500 and nasdaq look poised in the first quarter to end in the green. the dow would need about another 100 points by the end of the day so we have a couple hours to finish up for this quarter and really, the year. what is the outlook for stocks given the current conditions? dominic chu still crowing about his ncaa bracket, checking out the numbers. >> turns out all three major stock indices managed to finish in the green in the first quarter. the prospects are pretty good for the rest of the year. after a slightly down market in the second quarter, the dow

finished up an average of 13%, the s&p 14%, and the nasdaq 16% to end the year. that's of course over the past decade. of course, the dow would need a heck of a run in just the last two hours to make it positive for the quarter. the last time over the past decade when the s&p and nasdaq both finished higher in the first quarter but the dow finished lower, like we're at right now, it was 2007, during that single occurrence all three major indices rose between 6% to 9% just in the next quarter and finished the year with gains as well, about 4% to 10%. of course, one year does not a trend make. still, it's something the bulls are hoping will keep some of the upside run intact for stocks, again, 2007 the last time we saw a first quarter where the nasdaq and s&p were up but the dow was down. >> good historical stuff as always. thank you. still ahead, gm stepping up its already massive recall. is anybody going to go out and buy a gm car? we will speak with a dealer. plus, the west coast getting

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general motors announcing a big expansion to its massive ignition switch recall. eamon javers joins us with more. more headaches is what it is for gm. >> reporter: that's right. it will be a very tough day on capitol hill tomorrow for gm ceo mary barra, who is going to testify about this ignition switch problem that gm has had

and some of the questions here are just exactly how long has gm known about this and what did they do, did they take the appropriate steps to fix the problem that apparently included ignition switches themselves that if there was a key chain on them that was too heavy, it could cause the entire car to shut off and also possibly implicate the airbag as well. just within the past few seconds, we have gotten some excerpts here from mary barra's prepared testimony up on capitol hill tomorrow. let me read you some of the headlines that are just now flashing across the reuters wire service. i will read this to you right from my iphone here. gm ceo barra is to tell congress that she does not know why it took gm so long to catch the ignition switch problem, that's according to her prepared testimony. she is also going to offer her quote, sincere apologies to all affected by the gm auto recall, especially to the families and friends of those who lost their lives or were injured. that again according to her prepared testimony for tomorrow's hearing. i should tell you that some of those family and friends will be up on capitol hill for this hearing, so we can expect a

fairly dramatic session here and some emotional scenes as well. also, within the past hour or so, we've got a new letter from democrats up to gm asking for more information. let me read you an excerpt of what the democrats on capitol hill are saying. they say in a briefing last week, ignition switch supplier delphi informed committee staff that gm knowingly approved ignition switches that fell below the company's technical specifications in 2002 and again in 2006, when the switch was redesigned. so you're right, it will be a very tough day and very pointed questions for gm and its new ceo tomorrow. >> eamon, thank you very much. so who exactly is buying gm cars now? what are the dealers telling customers about the safety of gm's cars? joining us on the cnbc newsline is lynn thompson, president of thompson buick gmc cadillac in springfield, missouri. great to have you on our show. how has business been since the start of the recall? >> thank you very much for having me on your show. the recall itself, we have four

separate recalls right now that have gone into effect. the main one is of course the ignition switch recall which is the cars sold from basically 2003 through 2007, which is a lot of vehicles, and it's a time frame issue, too. do these people still own these cars. we have cars we have in inventory that falls under this and cars, these particular cars we have sold so we can follow up on this and try to get these people in and get them fixed as soon as possible. we've got -- the thing about mrs. barra, i have not met her personally yet. i will in a couple weeks at the new york auto show. but from everything i read and everybody i talked to, she is on top of this and wants to let everybody know that this is a priority for her. >> but lynn, as a dealer, do you feel that gm is communicating

with you effectively? are you happy with the job they have done so far? >> for instance, i'm getting lists of the people who have the cars and the information that i'm getting on how to fix them, what to do for the customer, so on and so forth. for instance, on the ignition switch, i probably have a letter that is seven, eight pages long of questions they may ask and answers for them. for instance, we are going to start getting parts in next week for that and it takes awhile to get all the parts we're going to need. but when you call us, we call you or you call us, we are going to get you in as soon as we can, get you a free rental car. gm is stepping up on this and doing what they can. it's very unfortunate what's happened with the people that they can't do anything about

now. they are addressing the issue. >> lynn, we have to leave it there. thank you very much for your thoughts on that subject. indeed, tomorrow, mary barra will be testifying on the hill at 2:00 p.m. that is our time. so we will be carrying it live here on "street signs." couple dozen people are still displaced after this weekend's 5.1 earthquake in orange county, california. it's got residences and businesses worried, perhaps a dormant fault has been awakened. jane wells is near the epicenter in fullerton, california. >> reporter: i'm not kidding, 30 seconds ago we had another aftershock. felt like a subway going under the street. wasn't strong but enough to look at each other, like did you feel that. a few minutes ago, the inspectors arrived from the city, to look at some of the houses. we have video of that. they are at this house next to me trying to determine if the houses they have red-tagged are now safe to inhabit. they are being inhabited whether red-tagged or not. broken dishes may be easier to fix than rattled nerves as friday's quake was a little

unusual because most people were awake. it happened at 9:00 at night. usually these things for no particular reason happen in the morning. a few structures still red-tagged, school is closed. the biggest problem has been restoring gas and water as pipes were broken but it has been a long time since we had a couple quakes of this magnitude and even for veterans of earthquakes like resident linda lenn, i will h let her describe what it felt like. >> just scared, very scared. scary. i never scary like that. >> reporter: what happened to your house? >> well, all messy. look at the picture. look at the wall. just scary. >> reporter: do you have earthquake insurance? >> yes. yes. well, i don't know how much they will pay for us, though. i don't worry about that. >> reporter: well, the damage

isn't extensive enough to begin to have the earthquake insurance kick in. here's the thing. it's hard to predict when these earthquakes are going to happen because so many times, these quakes we have been having are popping up on faults that the seismologists aren't even aware of before. in fact, the one, the fault system responsible for this particular quake, the christian science monitor reports they didn't fully even know about it until 1999, when they got access to private data from an oil company. back to you. >> yeah, that is an area, i went to elementary school there, i know the area very well. my dad owned a gas station right there. it's an area that i don't want to say is not prepared, but you have knotts berry farm, you have disney, major tourist attractions there. it's not an area i would say is well prepared for an earthquake. >> reporter: what is well prepared? people here may have the supplies but you know -- >> not expected generally.

>> reporter: it's going to be big and -- well, i don't know. that 1987 whittier narrows quake was big for people living here at the time. a lot of people of course have moved in since then. that's the thing. it has been a long time since we have had the sorts of quakes that make you think about do i have insurance, do i have supplies, do i have a plan. we are now starting to think those things again. yet even so, only 10% of california residents have earthquake insurance because it is so expensive. >> jane wells, be safe. thank you very much. still ahead, the most powerful weapon that america can use against vladimir putin. but will we use it? plus, big bad news just in for diet coke. we will tell you what it is when "street signs" returns. mine was earned in korea in 1953.

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the down side by half a percent. of course, the recall problem and the issues do continue here. the gmc ceo, mary barra, is saying they do not know why the automaker took so long to fix the issues. indeed, it took nearly a decade. but they will hold themselves accountable for those problems. we will wait and see what comes out of that. we are still filling in a lot of blanks on the story. the most powerful weapon we have against russia likely not a missile or naval ship. it may be oil. if oil falls to $75 a barrel like the cover of barron's suggests, might have a major impact on russia's economy and stimulate our economy as well as gasoline prices go down. is there any chance of this happening? let's bring in senior contributor for the street.com, dan dicker, who says heck, no. why not? >> well, there are three reasons that i see that oil has no chance of reaching $75. the first one that barron uses to describe why it might reach $75 is because we have so much production that's gaining ground here in the united states.

but all of this production has amounted to only about two million barrels. we might get another two million barrels a day. in fact, that's really nothing, kind of a drop in the bucket compared to global oil production which actually seems to be sinking right now. the saudis are at a full tilt right now. the second reason why we may not see $75 and i think there's no chance we will see $75 oil is because the technologies we use for getting marginal barrels, the fracing of oil shale and the very, very deep water drilling, these are very expensive barrels. all of the easy oil is in fact running out, that $5 a barrel oil that we think of when we think of the old-fashioned guy sticking a pipe in the ground and doing the dance while the oil comes gushing out via john houston and all of that. all of that oil is gone. most of that is now gone. and the oil that we are drilling for now is much more expensive,

the marginal price of that is well over $50 a barrel. some of it is over $80 and $90 a barrel. >> to pick up on your first point, remember last year you did some great reporting on this and i remember asking what is the biggest risk to the boom and you said cheap oil. cheap oil prices because it just makes it -- makes digging and drilling absolutely unprofitable. you do not have any vested interest in letting the price go to $75 or below. >> not only that. but they will give up on some of the shale plays if prices go down that low. it's only worth it to drill if they get prices above $100 or $110. there are fines in the gulf of mexico that are not being drilled right now because they need $110, $120 to make it worthwhile. >> agreed. the point of the segment is to talk about obama's trip to saudi arabia. think about the genius of this. he meets with the saudi king, say he convinces him to up oil production more than 11 million barrels a day. okay?

>> a question if they can do that. i will go with you so far. >> maybe they can't. >> that's what i think. >> if they could, suddenly now saudis are pumping more, oil goes down, russia's leverage, gone. >> if you could leverage prices down and in fact, there was a study that came out recently about releasing 70 million barrels from the strategic petroleum reserve to try to at least temporarily force down prices. i think we had, for example, we had a five million spr test release or they said it was a test release. i really think it was sort of a test of how much effect the spr could have on lowering prices. it was a flexing of muscle on russian oil but in the end, i don't think an spr release or the saudis can drop marginal barrel price. barron's is all wet on this prediction, to tell you the truth. >> we will see. thank you. up next, if you are one of the 29 million americans that's been prescribed lipitor, listen up. we will tell you about a

potential game changer in the fight against high cholesterol. later, the big government buzzkill. how overregulation is killing craft beer makers according to a craft beer maker.

huh, fifteen minutes could save you fifteen percent or more on car insurance. everybody knows that. well, did you know bad news doesn't always travel fast? (clears throat) hi mister tompkins. todd? you're fired. well, gotta run. geico. fifteen minutes could save you fifteen percent or more.

happy monday, everybody. street talk time. daily rundown of stock news and views you can use. small gains today, 2% or so. shares getting an upgrade to buy from hold at key bank. >> key bank raising their target to $45, up about 20% from the current price. they think the store is seeing some traction amid a turnaround. big lots is getting out of the canadian market. key bank says that should help them focus more on their core. >> let's take a look at trucking company swift transportation. obviously upping this target about 11% from its previous target to $29. >> that's about 16% upside from the current price. the stock is up 5% right now. the rating remains outperform. rbcc's favorite accounts including scaling multiple divisions of the company, up 75% in the past year. >> okay. a hugely negative call on

biotech, look at that, down 15%. >> yeah. i thought about whether or not we should have this in here but i think it's an important call. piper jaffrey downgrading it. the target goes from $5 to $1.50. folks, the stock's at $4. that's a 60% drop in price from here according to piper. has to do with drug trials. they say a number of obstacles surround the fda approval risk. they are basically saying get the heck out of the stock, don't have anything to do with it. >> let's move on to affiliated managers. the stock goes up to a buy from mutual at citi. good for 5%. >> not a bad gain today. they operate through boutique investment firms so this is the parent company name. target up 18% to $225. they see expansion and long term growth after a couple of deals. >> vip shop is seeing solid gains today after an upgrade to buy from neutral at goldman sachs. it's vip shop. >> we had to learn that today. stock up 6%. target is $185. they cite compelling growth

prospects as well as attractive valuation. they are an online discount retailer based in china and of course, like any discount retailer based in china, they pepper their website with flamingos. tesla's ceo elon musk was on "60 minutes" last night. wasn't just michael lewis. he had some surprising comments about his own expectations for tesla. take a listen. >> how did you figure you were going to start a car company and be successful at it? >> i didn't really think tesla would be successful. i thought we would most likely fail. i thought that we at least could address the false perception that people have that an electric car had to be ugly and slow and boring like a golf cart. >> you say you didn't expect the company to be successful? then why try? >> if something is important enough, you should try even if the probable outcome is failure. >> shares of tesla, we don't need to tell you, "street signs" viewers have been fantastic, up 450% in the past year. but is there still time for your hard-earned money? let's talk numbers.

carter worth and john stevenson. carter, i want to go to you on the technicals first. many say this is a technically driven stock because the fundamentals are so far in the stratosphere. technically how does it look? >> i think that's quite right. fundamentals almost don't matter in this instance. i guess the issue is this. there is weakness to take advantage of in life and then there's weakness to stay away from. we would argue that the current sell-off is weakness to take advantage of. the stock is having hit a high of $265 is now about $207 and we are down to a level where support comes into play. so the way it's come down is controlled, low volume, not aggressive selling as opposed to all of the heavy volume advances to the upside that we've seen over the last year and a half. we would take advantage of this current one-month selloff to add to positions and if one is not long at all, take advantage of the weakness to buy. >> john, how do you feel being told that your fundamentals practically don't matter with this stock? nonetheless, tell us about what the fundamentals will do to this stock going forward. >> this is a pratfall waiting to

happen. this is a heavily cyclical industry, massive capital investments necessary. the company is trying to build a giga factory to produce batteries. that's $2 billion alone. everything is predicated on execution, huge capital spent and elon's own view, i saw the interview, was essentially it could be hard to make money at it and in fact, the company wasn't making money. you look at their earnings, their adjusted earnings were 78 cents last year but when you factor out the credits and everything else, you are looking at a loss of $1.93. ridiculous valuation, 68 times forward earnings. they would have to sell 19 times at current volume just to earn into that. really, you are looking at a company that is very hard to see how you can make your money back if you get in now. >> all right, guys, thank you very much. hot stock, certainly one that will be debated for days, weeks and maybe years to come. check out the online edition of talking numbers, part of our partnership with yahoo! finance. coming up next on "street

signs" are you looking for income? we ran a screen to show you some of the highest dividend yielding stocks the s&p 500, there's only two big problems with them. later on, a big buzzkill for america's craft brewers. first, to kelley and bill. what's coming up on "the closing bell"? >> we are heading towards the final hour of trading for the day, the week, the month, the quarter. we take a look at the highs and lows and what it may portend for the second quarter of the year. >> also, everyone here is talking about michael lewis' new book "flash boys" and his charge that markets are rigged. only one show has larry kudlow talking about it and "closing bell" has him. >> also, we get reaction to lewis' charge of market rigging from our panel of small investors, retail investors will join us coming up. >> all that and more starting top of the hour. what's in your ear? oooo! a quarter! check for more! well, i guess i can double check...

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that are powered by the moon. ♪ she can print amazing things, right from her computer. [ whirring ] [ train whistle blows ] she makes trains that are friends with trees. ♪ my mom works at ge. ♪ welcome back. just a reminder to all of you out there that the author michael lewis is going to be the very special guest on "power lunch" tomorrow. that is at 1:00 p.m. eastern time. we will be talking more about the hft issue that we brought to you at the top of this hour. all right. if you are nervous about the

overall market but don't want to buy bonds because like we talked about, they can be boring, but you're looking for dividend income as promised, we ran a screener for the highest dividend yields in the s&p 500. the three names are, drum roll, please, windstream holdings, yield 12% p.e.s 20.6. century link yield 6.6%, the p.e. is not available because they don't have any earnings. they lose money. frontier communications, yield 7.1%. two reasons to be cautious. you all know there's a reason why stocks pay a high dividend. they need to lure you in. what do we have to offer you? >> a dividend. we have nothing else. >> we have some core issues. here's the thing. they are all the same kind of company, basically old school copper line telecom companies and the p/e ratios. people are piling into these names already this year. just something to be careful of. >> okay. well, beer buzzkill. the man behind one of america's

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the biggest soda companies have a weighty problem on their hands. new numbers out minutes ago show shares of diet drinks are in steep decline and the negative headlines are also piling up. sara eisen has the skinny on that. what's the biggest headline that stood out to you? >> certainly you mentioned diet. diet soda is just one of the industry's biggest problems right now. there is this new report out from long-time analyst from beverage digest that shows that for the ninth straight year, soda volumes in total are down and the rate of decline actually sped up last year. volumes down 3% in the united states versus about 1.2% the year before. total u.s. carbonated drink volume, back to levels in 1995.

and diet certainly was a standout on the negative side. diet drinks got hammered. volumes for diet coke down 6.8%, 6.9% for diet pepsi. these are important numbers because diet for a long time was a source of growth for the industry. now, it is very much a drag. everybody is talking about a study out this weekend from the university of iowa that showed that post-menopausal women who drink two or more diet drinks a day are 30% more likely to have a heart attack or cardiovascular event. 50% more likely to die of heart disease. the beverage association argues that there was no causation actually found, just association. still, it's negative headlines like this one, studies and concerns about health along with shifting tastes that do show that diet sales are certainly on the decline. it's something the industry in general, especially the big three, coca cola, pepsi and dr. pepper snapple, are going to

have to fight against. they are working on innovation using products like stevia, artificial sweetener versus natural sweetener. >> according to the people you have spoken to on this issue, which do they think is better equipped to be able to handle this declining trend in sales of soda and diet soda? is it coca cola or pepsi? pepsi has a lot of salty snacks, for example, to fall back on. lot more diversification. where does that leave coca cola? >> actually, a long-time industry analyst for wells fargo put out a note on this saying that coca cola has the most to lose but also the most to gain from the decline in diet, because it highlights the fact that they are so strong in the regular carbonated drinks, it also highlights their international growth which can offset some of the declines in diet. pepsico also is insulated because the top line or the sales driver for pepsico has really been the snacks division. but all three of those companies do have to deal with it and it weighs on their results. all three of them, though, do have ways to fight it.

it just depends how fast they can innovate and really adapt to the changing consumer. >> we can see it, the coca cola stock is down by 1%. pepsico moving higher. thank you so much, sara eisen. soda companies are not the only beverage companies that are facing some issues. your next guest says that big government is playing favorites with big beer. he wrote an op-ed in the "new york times" this weekend saying government regulations are killing craft beer makers. joining us, stephen hindy from the fantastic, by the way, brooklyn brewery. pleasure to have you on the show instead of consuming your product. it's hard -- listen, i liked your piece but i will push back and say this. there is more than 2,000 craft brewers in america now versus a couple hundred a decade ago. that doesn't seem like it's killing the industry to me. >> well, the growth of the industry is happening in spite of this problem we have, which relates to getting our products to market. you know, in most states, in the country, there were laws enacted

in the 1970s to protect beer distributors against big brewers pulling their brands out and ruining distribution company. they're called franchise laws. at that time, there were fewer than 50 breweries in the whole country and there were 5,000 distributors. over the last 25 years, the number of breweries in america has grown to more than 2800 and the number of distributors has shrunk to about 1,000. that means you've got a lot of brands looking for distribution. so what's happened, unfortunately, is some distributors take on a lot of craft brands and then they pick out the ones they want to focus on, the ones they want to push, and they kind of sit on the other ones so their competitors can't get them. so there are distributors in markets who want to get their hands on brands that are stuck with a distributor and the

distributor is protected by this franchise law. we think that's unfair. >> so your only recourse is to go down the legal route to sue. i would imagine that a lot of small craft breweries really don't have the resources to do that, to take on the distributor. >> well, that's exactly right. we sued a distributor upstate new york a few years ago. he wasn't performing well and he was doing a few other things, selling outside of his territory. we won two court decisions, but he was threatening to appeal, and we settled out of court. the whole thing cost us more than $300,000. luckily my company was big enough to absorb that, but the vast majority of craft brewers could never undertake a legal action like that. and those are the people that we're trying to protect. >> how are you going to go about doing it, steven? what's your next step? >> you know, we have been talking to the national beer

wholesalers association, which represents these beer distributors across the country. we've been talking to them for years, literally 15 years, and we've sort of given up. they're not budging on this. and so we've decided to go to the media and try to tell our story and hopefully have some impact on public opinion. >> certainly creating awareness is one of those steps. thank you very much for telling your story, steven. >> thank you. >> no doubt, we've all heard of lipitor. heck, we're probably all on lipitor. but now there's a new class of experimental class that can lower cholesterol. barbara, obviously lipitor just printed money for pfizer. are there other companies out there that have a similar story to tell? >> so basically we saw news out of the american college of cardiology over the weekend

reporting out on amgen's new class of cholesterol lowering drugs. there are other companies in this field, the drugs are called pcfk-9s. they showed dramatic improvements over the standard of care in terms of lowering ldl cholesterol. other players in the field are sanofi in collaboration with regeneron and pfizer. >> we nouknow a lot of drug companies move in terms of their share price on hope. if you take a statit, n, it can a pill, but some of these new drugs can be very expensive and might be injectable. >> absolutely. so they will be injectable, although they can be self injected.

they will be every several weeks or even once a month, and because they're bye-b biologics they will be very expensive. lipitor was the large esst sell drug in the world. additional, it is still not clear whether the measurements of cholesterol are going to be sufficient for regulators and specifically the fda to approve these drugs. so right now there are long-term studies to measure whether those reductions in ldl translate into benefits in terms of card cardiovascular disease, lower incidents of risk. that data will not be available before 2018. >> macro sense, biotech has been a hot story. everybody freaking out about this gilead sciences payment news. did people overreact to gilead or was the sell-off deserved and

overdo? >> nothing goes straight up forever. biotech has been a massive outperformer for a lot of solid fundamental reasons. pricing is always a concern and we just talked about that here. 11 of the last 12 oncology drugs cost over $100,000 a year and obviously gilead's $84,000. whether that price something sustainable is something investors always worry about although i do think we are seeing a lot of innovation, a lot of money going into funding innovation in the early stage companies and i think it was probably a correction and probably one that was pretty healthy. >> barbara ryan, real pleasure. thanks very much. >> thank you. >> up next, a reason to break out your little tiny violin for the 1%. ♪

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the 1% is not created equal but we hear all the time about the 1% guys versus the 99%. there are some surprising stats you aren't hear being the income divide. robert frank is here and, robert, we have talked about this a few times where the gap between the 1% and 99% is big but the gap between the 0.01% and the 1% is astronomical. >> that's where the real growth has been. we shouldn't feel sorry for anyone if they're in the top 1% but most of them aren't doing as well as we think. a new study looks at the top 1% by wealth. this shows the bottom half of

the 1% has seen their share of national wealth remain flat over the past 20 years. the top 0.1%, their share has more than doubled. it's actually even more true with income. we don't actually have been income pyramid. we have an income skyscraper. it looks like more like the 160-story tower. if they're the top floor, the 1% is down 150 stories. even among the billionaires there's a huge growing gap. mark zucker marriberg made mill during the facebook ipo. someone making 400,000 million a

year, they're a 1%. >> bring back the line chart. if you overlaid this with the equity market they would probably track. we don't have an income inequality issue, but we have an asset inequality issue. someone wrote this last week. they said if the value of your labor is your only asset, you've been left behind. >> that's right. it's all equity driven. that's why incomes at the very top, you get one hit wonders like zuckerberg with an ipo and he doesn't repeat the next year. >> as far as people you speak to about this say the trajectory will just keep getting worse. >> absolutely. well, worse, depend if you're zuckerberg or the world. it's going to keep going because more and more fortunes are tied to financial markets. >> so it's stock. >> it's all about stock. >> we need a new bumper sticker,

we are the 99.99%. thank you for watching "street signs." >> indeed. "the closing bell" is coming up next and make sure you join us same time tomorrow on "street signs." and welcome to "the closing bell." i'm kelly evans at the new york stock exchange where the first quarter now has precisely one hour left of trading. >> i'm bill griffeth. we are ending the quarter with a nice rally. i guess you would call it the typical window dressing for the end of the quarter. if we close at these levels, only the dow would be lower for the year or the quarter so far and that's just about 100 points below its all-time high set back on december 31. we will bring you home to the close and set you up for what to expect for the second quarter coming up in the next couple hours. >> it has been so interesting as we head into the final day of the quarter. the difference that it