higher, but the industrials struggle. >> that's right. they're slipping a little bit. we'll see what it looks like going into the close. have a great weekend. thank you for joining us on "power lunch." that does it for this edition. >> "street signs" begins right now. if you want to buy a vowel for today's show, that vowel should be the letter e. hello, everybody. happy friday. your big stories of the day all beginning with the letter e. we're going to hit those for you in moments. plus, boonepickens with his -- if he is sticking by his $100 a barrel oil call. why housing may be starting to slow, but, mandy, wow, tech stocks, pretty strong. >> yeah, they really did. this week really belonged to the techs. the nasdaq is up for the fifth straight day, and it's definitely its best week in three months.

the s&p tech sector is also leading the way. up over 3%. within that sector, brian, both classes of shares have tacked on over 6% so far this week. >> all right. let's call today's show sesame street signs because it is brought to you in part by the letter e. your top stories include earnings, the euro, and energy. we are, of course, covering it from all fronts. bob will tackle earnings. sarah all over the beaten up euro, and jackie talking energy in the oil pits of new york. bob, kick us off with big earnings names trying to help the market today. >> it hasn't been a great earnings season so far, but we're getting into the heart of earnings, and we're getting diversified companies industrials and consumer names, and it's a little better. look at today. we had general electric. better than expected. a little bit. we had honeywell better than kidnap. 103.40. that's an historic high if we close right there. starbucks was about in line. the guidance on traffic was pretty good overall. that's up 6%. that's good news. unfortunately, ups kind of spoiled the party a little,

guys. the lower guidance they had, they were talking about higher costs, but it was higher costs. it wasn't lower demand. i think that 9% drop is a little excessive, and people are feeling this as a company specific problem. competitors are not down nearly as p. now we're in the heart of earnings season. it's been a crummy earnings season. we were up 1% in earnings for the s&p 500. on december 31st, yesterday, we were only up 0.1%. this is for the whole s&p 50000. i think it's going to improve. my guess, guys, will be up 3% to 4% for the s&p 500 by the end of the quarter. back to you. >> we certainly hope we're getting into the heart of the earnings season, bob. it will be a whole lot less crummy. our second is the euro, and it's getting chopped up into tiny pieces. $1.12 for the first time in over 11 years. its share at 7% since the start of the we're. >> let's bring in the securities

princess sarah eisen. >> i will take that title. the speed is the key. i'm glad you brought that up. it is the size and the scope of the move that's catching everyone off guard from trading desks to central banks around the world. we've stabilized here above $112, but earlier we were in the 111 territory, and down 3% on the euro just sense the announcement. now more and more people are calling for parody. one euro to $1 it's becoming a popular bet on wall street. morgan stanley took down its forecast all the way to $105 by the end of the year from $112 previously. as can you see if we look at a chart of the euro, we've been there before. the euro after it first came into existence after 1999 went as low at one point as $86. we can get there. it is just that speed that many are wondering could be destabilizing for the flip side. the strong dollar. strong -- what those central banks are going to do. not only those, but perhaps the

federal reserve and whether there will be a commentary about it as well. >> tough time to be a mortgage holder in poland in swiss franks, sarah. >> currency. >> thank you. now to our final e, and that would be energy. there's a new level of uncertainty added to the market in the wake of king abdullah's death in saudi arabia. jackie deangeles with the nymex with more. two big stories in one. >> good afternoon to you, brian. really interesting to watch the price action today because upon the news of king abdullah's death, we did see a spike in oil prices, but we're really coming off on the brent price. only up 21 cents. now $48.73. wti is down a negative territory, down 85 cents at $45.46. initially there was a knee jerk reaction here. of course, the markets don't like uncertainty. that's what they were considering here with a regime change. then as they sort of digested it and more news came out, it appeared that the successor to

king abdullah will bring continuity to this regime and probably not make too many changes, including to his cabinet. however, all eyes are always on the future. they're looking to the next in line after him, and they're also looking at the oil minister al niami. we're wonder if anything we'll see a change there. that could have a bigger impact on the oil markets, so potentially watch for that. meantime, into the close, prices moving lower at this point. >> thank you very much. we're going to have so much more on all of these things. particularly oil later on in the show. we have billionaire oil man boone pickens who will be joining us in about 30 minutes from now. now you know the news around the three e's, but what do you do about it to make a little money for yourself? bob phillips of specter management group and mike of gradient management group. what do we do with the trends that we just laid out? >> well, when you look at energy, i think the temptation is you want to just jump into energy. you really feel like it's a bargain, and you got to get it

now, or you're going to miss it, right? i don't think that's a case. usually these bottoms take quite a while to play themselves out. you know, i don't think oil goes much below 40, but does it hit 60 right away? no. if you want to, get into oil and make that trade and play it for a year from now. i would stick to, you know, higher quality names and bigger names. things like exxon and slumberge. let the layoff goes on and the production get shut. that's how i play it first. speculate later. >> what do you think are the most important three e's, bob? what do you think maybe over the next few days, few weeks in the market is going to be the key focus that we should be watch g watching? >> i think right now the earnings are being revised downward significantly. if you look at september 30th, analysts are looking forward 12 months expecting the s&p to have a 15% growth in earnings. now as of december 31st that number is down to 10. like a 33% drop in expectations. that can all be attributed back

to the energy sector. energy sector stocks, as of september 30th, we're expecting 15% increase of earnings for 12 months. now we're down to a decline of 13%. now when you look at the last five times, you have an oil decline of 35% or more since 1986, but what tends to happen is you have earnings uncertainty hitting the energy stocks first without any positive spillover to the rest of the market. following by a few months, positive things start happening. other parts of the market. earnings start getting revised up. nonenergy stocks. we think that now is a pretty good time to take positions in equities in the u.s. that are non-energy related. >> not energy related. both energy and earnings within the same pair graef, but nothing about the euro. to either of you does the euro matter at all to watch how markets are going to do? bob, you first? >> i do think that the ecb's program obviously they're trying

to decrease the euro value versus the dollar, which makes a stronger dollar, but it also causes money to flow to the u.s. from overseas. interest rates here as low as they are as we all know are higher than they are in euro land, so i think dollars flow here, which is the support for our asset prices, and i think it keeps a cap on our interest rates and doesn't push them lower. again, it's the stimulus mathematically to pricing equities higher. >> all right. mike, again, we've gone through it all now. through e's. threw out wild card that maybe you are hot on right now. >> well, i think google is a great play right here. now, they're not affected by energy. you know, the currency translation fact ordz don't come into play. the stock didn't do all that well in 2014. i think this is a midteens earnings grower. this is a high teens, you know, top line grower. it's cheap at 18 times. they dominate and invest for the future. i mean, you know, i think their future avenues of growth will be wireless phones, mobile payments, and who knows? maybe even space travel sometime

down the road. i think google is a buy right here. it's cheap. it's growing. i think this year it all performs. >> as we just mentioned, google has had a great week. up about 9% from its recent lows. bob and mike, great to speak with you. >> a lot more to do ahead, and what some of the most powerful people have to say about our three e's. earnings, energy, and the euro. we've got a view from snowy davo, switzerland, ahead. we have not one, but two mystery charts for you today. they also just happen to be our stocks of the week, and you guessed them. here's my pick. the stock really took off. climbing about 14%. hit me up at sully cnbc if you have a guess. you're smart. >> my pick, on the other hand, did not do too well this week. it really mailed it in. it hit the brakes. there you go. >> you will see both of our picks when "street signs" returns. there's nothing stopping you,

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>> things are starting on too wind down in davos, switzerland. many of those power brokers have joined us on cnbc throughout the week. talking everything ecb to energy to the u.s. economy. you name it, they talked it. in case you missed any of it, here are the best of comments from one power-packed the week. >> i think we're at a moment when the u.s. economy is doing

much better than other economies. >> pretty much everywhere around the globe we're seeing fairly depressed economies. >> the longer-term objective for europe which is really about jobs and economy, is going to take more than what the governor can do in terms of bond buying. >> so we have to see feeling through to the european economy lifting expectations and creating, and that is what we want to see. >> lower energy prices is probably the largest redistribution of wealth that we've seen in our lifetime. >> i actually think the fed has done a terrific job, and we can raise rates. it will be volatile. it will be painful. >> the united states definitely confidence is picking up, but we know europe is still in a very slow growth mode. >> we're in a divergent world. it will dominate the discussions here. the divergence is largely driven by policy zoosh a lot of thought-provoking comments from heavy hitters from around the world. steve liesman, we'll get to a

$43 hot dog. there's been some interesting comments. you have all this stuff here. when you take your big brain and look at everything you've heard and seen, what sticks out to you? >> what sticks out to me is this overall notion of, first of all, the shifting sands, no pun intended, that's created by lower oil prices. i'm not sure this very intelligent group of people know how to process that. again, the general notion that it is beneficial for the united states and probably beneficial on net for the world economy, but creating different students, different problems in places we haven't had a hands to figure out. how to put the multiples with a discount rate on it. that's one. two is, okay, so they're in the middle of this conventional wisdom. europe is slower. the united states is faster. yet, in the middle of this meeting drogi comes in with this massive, bigger than expected

quantitative easing program. >> sometimes they get criticism, right, because look, you know, they're all rich people. they're sitting around and drinking and they don't have a very realistic view of the world. do you feel that the comments that we heard were realistic about the state of the affairs around the world right now? >> i think the comments we heard realistically reflect the comments that those people made and how they feel. >> okay. >> i also think it is very much -- that was -- >> that was a very -- >> that was -- >> it means they said what they meant and they meant what they said. i don't think that they have -- >> according it their world. >> that's right. >> i think -- listen, i hear exactly what you are saying, and you are exactly right. >> i'm agreeing with mandy in a round-about way. >> let's be clear about this. i think they can get up and, you can have sessions, and i don't think -- i don't think that the billionaires should pretend to understand the problems of the every man. let's also remember these are the men and women who do create

policy, so at least we can read insight into what happened. >> rather than saying i understand the plight of the poor. no, you don't. you flew here first class or on a g4. you also can affect policies that may benefit others. that's how we have to take. >> you would not hear from this group that the way to solve inequality is to do redistribution from their -- to those of the middle class around the world. you will hear there is a striving -- i know a lot of these guys personally. there is certainly a striving on the part of these folks to get policy right in a way that benefits the most number of people. >> well, also, i will actually press back on you a little bit about that middle class comment you just made. i think that a lot of people i have talked to, and we get that on in our job we get to hang out with some pretty heavy hitters. that's one of the cool aspects of being at cnbc. everyone i have talked to that's a billionaire or whatever, they understand that massive inequality gaps is not good for anybody, especially social justice, or potentially social unrest. >> the question is do they do the kind of deep thinking that's

necessary to figure out what the right policies are to address it. you have president obama give us one view of the world on tuesday night, which is this middle class economics idea. again, politically it has almost no chance of going anywhere, but conceptually, in terms of framing a debate, i think the president is on to something only in the following ways. what are the right ways to fix this problem? and redistribution in terms of providing benefits and opportunities could be one piece of that puzzle. >> i've got a question for you. what goes beautifully with kg? $43 hot dogs. >> that's what they're having to pay. >> at one hotel. >> yes, but a very expensive no thanks to the sudden soar -- >> the grand hotel belvedere. it has fried onions. >> did you get the fried onions with the 43? >> that's included. >> $48 for a ceasar salad. >> well, it was -- okay. we got to go. >> we got to go. >> it was a great time for the

swiss there. >> hard for the tourists. it's going to hurt tourism because of the exchange rate. >> we solved the world's problems. >> that was the real swiss franc story right there? get it? a hot dog is also known as a frank. >> that's good. >> nice. >> you have to explain a joke? >> that was good. >> if have you to explain a joke, it wasn't a good joke. >> good pun, though. i like that. >> people can tweet us if they got it. so far this year the home building etf, the itb is down nearly 4%. coming up next, what is the best way to make money in housing? the stop analyst is going to be joining us with four top picks. plus, outrage to some big college savers. details ahead. >> boone pickens coming up. i've been called a control freak...

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members with everything from investing for retirement to saving for college. our commitment to current and former military members and their families is without equal. start investing with as little as fifty dollars. existing home sales rose, and that's an annual rate of just over five million homes sold in a year. that was a little less than expected. it is also the first annual drop in the number in four years. >> okay. well, so far this year the home building etf, the itb, is down nearly 4%, but does today's bullish data show opportunity in

housing stocks? >> i think it's a little bit of a better opportunity for your building suppliers. what we are excited about this year is more in the buying side than the pricing side. for the home builders we're going to see the buying, but probably from the lower end. first time buyer, millenial buyer. >> that means not necessarily a good thing if its demapped coming from the lower end. the margins aren't there. >> the margins are typically lower on that piece of business, and we're also a little bit worried that they might not have the product there yet for them. i think it's a little bit better for the building products guys to come in. you won't see the pricing pressure yet, and they can benefit from the demand. >> building products, a big space. >> yes. >> it is. >>. >> yeah. it's a big space. >> go buy a lumber company. i can't do that, but what can you do? >> we like masco. they make cabinets. they make paint and plumbing supplies. >> at the make the family very wealthy.

>> they, do and they have. they have a new ceo. we think they're making strides in their cabinet's business, which has been under pressure. we like whirlpool. we know what they do, and we think there's a really nice replacement cycle kicking in as well as the new construction cycle. >> it's done quite well. up 30% over the past we're. you still like it at those levels? >> we still like it. they just made two acquisitions. they show should really help the company grow its earnings over the next couple of years. >> who is in the worst spot? >> probably the home builders. what we're worried about now a little bit, obviously texas. big conversation about oil. a lot of the companies that haven't done that well are those with incremental exposure to texas, and what the builders are saying is they haven't seen any negative moves yet, but i think everyone is just kind of waiting for them to come out and admit that things are going down there. >> yesterday we saw job else claims. they are ticking up in texas. >> i've been to midland. i know midland is not houston, but i've been to midland multiple times, and everybody is taking pay cuts. that's in the oil industry. if you have less money to spend,

you buy a smaller home, or you don't buy a home at all. many of the banks are exposed to oil loans and that can constrict their lending. i know sentex -- is it lenar? who is really exposed in texas? >> there are a couple of small home builders. lgi homes. they are in the first time buyer. that could be offset a little. a lot of the big guys have around 20%, 25% exposure to the texas market. it could be big for them. so far everyone is taking a pass on kind of telling us that things are going to get bad. i think we need to wait to get through that to feel that pain first before the homebuilder stocks look more interesting. >> before your picks, toll brothers and kb. more for the patient investor, right? the longer-term view. >> it's also higher end. what we like about that stock this year is they're not going to see that mixed shift pain. they only do the high end investor, and they have a long build cycle. any near term, they're not going to feel that yet because they have a nine-month build cycle. the margins are preet good. >> i don't know if i would call

toll brothers a homeowner, considering these massive multimillion-dollar towers thief got going up. >> they're a condo builder. >> they're building huge buildings in manhattan and going directly after new york city. >> what they call their city living business. they have a couple up and running and into 2016. the brooklyn property has done amazingly well if you have been down there, and that's going to be a good business for them. >> a building boom in new york city. thank you very much for joining us today. well, outrage today after a reported proposal to take away the biggest benefit of 529 college saving plans. well, cnbc's john harwood is here to explain the details. is nothing sacred anymore, john? >> no. nothing is sacred, mandy. look, if you want to redistribute income in this country, and president obama does want to do that, have you to take some some to give to the others. therefore, part one of education redistribution obama style is subjecting for the first time at the passes the appreciated gains

in 529 plans to taxation capital gains tax whz they come out of those plans. now, the administration justifies that by saying 70% of the assets in 529 plans are with families who earn more than $200,000 a year. now, in return they would increase the tax benefits, part two of redistribution obama style, is increasing the tax benefits for the american opportunity tax credit. that provides up to $2,500 per family capped at families that make at least $180,000 a year. josh ernest, the white house press secretary, said the second part of that is critical to why they go after the 529 plans. >> the reforms that the president has proposed for the 529 program are reforms that he would consider only in the context of the other education reforms that he put forward, and when you consider that entire package of reforms, the tax cut that we're looking at for middle class families is $50 billion. >> now, people who benefit from 529 plans now can probably

relax. they are more politically influential than people who earn less money than the people in the top 5%. therefore, this plan is not likely to pass this congress, guys. >> john harwood, thank you very much. all right. up next on "street signs" a good old fashioned stalk brawl. one stock. two very different opinions. and can you guess our stock of the week. here's a clue. investors have hedged their bets on this one. that's brian's. my stock is hitting the skids. we're revealing both names when "street signs" returns. you just got a big bump in miles. so this is a great opportunity for an upgrade. sound good? great. because you're not you, you're a whole airline... and it's not a ticket you're upgrading, it's your entire operations, from domestic to international... which means you need help from a whole team of advisors. from workforce strategies to tech solutions and a thousand other things. so you call pwc. the right people to get the extraordinary done. ♪

>> vits good quality. e-trade, etfc, is e-trade. the best performing stocks of the s&p 500 right now. 8.6% gain. that name, again, is e-trade. >> yeah. >> okay. let's move on. another wild week for oil. e-trade for oil. new 52-week lows of 45 to 35 earlier on today. for your information, fyi as they say, the 52-week high was

$107 on june the 16th of last year. since then we've fallen almost 60%. okay. let's do something we do every single day. street talk giving analyst information we need to know about. citigroup coverage on united technologies for the buy. >> stocks not really helped. un.1%. citigroup's target on etf is $139, 15% up side to the current price. they like the cash flow growth story, in part because of what they call the urbanization trend. more people moving into cities, like we just talked about. that increases demand for utx products like elevators. >> moving on. second stock is chesapeake energy. >> credit suisse also raising the target to 24. credit suesse sees 20% up side. chk. third stock.

goldman saks upgrading steel maker new corps to buy from neutral. not really helping the stock, though. >> no, down. goldman likes a strong balance sheet. relatively low cost structure in the same call, by the way. they downgraded u.s. steel ticker x. they like nue. don't like x. >> this is a negative call on a small cap biotech. >> that small cap stock is momentum pharmaceutical. it is a sell, says maxim group. they cut it to a sell with a $7 target. the stock is at $10.60. 25% below the current price. >> today's under the radar stock is avalon holding. it's avol. >> it is an aircraft leasing company. it is also a fairly recent ipo. jp morgan starts coverage with an overweight rating. a $24 target. that's about 25% up side on avol. there you go.

now for a little stock brawl time. in fact, it is over dreamworks animation. the ticker, dwa. now, the stock down about 8% today. two analysts, though, out with two very different calls on that name. james marsh of piper jaffray trying to come to the rescue. upgrading dwa to overweight. just put out a note maintaining his underperform rating on the stock. james, you've got restructuring. you've got all bad news around dwa. why upgrade it today? >> i just think there is a tremendous amount of bad news baked into the stock already. we've got twice as many sell ratings as buy ratings for this stock. i think management is restructuring announcement yesterday addresses the issues that they have, which are, one, film production costs are too high. two, creative has moderated over the last few years, and their fill performance is moderated. then you think, three, they're dealing with the liquidity issues. >> okay. just to give a little bit of detail about the restructuring they nounlsed since you remptsed it, james. they're cutting about five 500

jobs and cutting down their feature films. they produce those each year from three to two. why are you not convinced this restructuring will be enough for you to like the stock? >> i think the restructuring is doing everything but addressing the issue that caused the restructure. the cost per film is too high. too high. you know, there is nothing wrong with making films that gross 300 million a year or $300 million at the box office. worldwide. they cannot cost $300 million to make and $165 million to release. the two films they released last year lost around $100 million. the restructuring deals with sgna. it does not address the cost structure of the film. they will still be spending at the same level, and the odds are still stacked against them every single time they release an original film. >> you think they'll still lose money as well? >> if the next release "home" which is scheduled for march 27th, performs in line with

madagascar, which game out around thanksgiving, they will lose around $45 million, i estimate, and the restructuring doesn't address that. it addresses sgna, so they cut $30 million. one frim loses more than that. that's the problem that continues. the structural issues are not addressed. >> james, you know, listen, you guys are actually both making similar points, and we're talking about restructuring and balance sheets and sgna and all this stuff. do you believe, james, that dreamworks and its team knows how to make a successful movie anymore? >> absolutely. i mean, you look at jeffrey katzenberg's track record. it's ho years of making successful films. they've taken their eye off the ball. the creative side as they've tried to push into some of these diversification efforts. everything that we heard from management last night was that they are refocussing back on that theatrical, and that's going to be the driver for some of these diversification efforts. whether it's television, consumer products, or some of the other initiatives they are pushing forward. >> are you so convinced, james,

you've actually upped the price target as well, haven't you? >> we raised our price target to $26 this morning. we feel very comfortable with the name. like i said, it's a consensus short right now. you've got twice as many sell ratings as buy ratings. it's extremely rare in my coverage universe. it's rare to see sells. >> real quickly, listen, if people are saying sell the stock, it will go down maybe like today it's down, is there a take-out floor? we saw pixar get bought by disney. is there a chance that anybody comes and buys dreamworks, to put some support under the stock? >> i can't tell you what will not happen. i will tell you that in my opinion it makes no sense for anyone to buy dreamworks animation. the last six original films they leased four lost money. dozens of millions of dollars. what it is currently, it's $220 million in sgna company that releases films that lose money. i don't see why anyone would want to be involved with that. >> okay. no white knight according to you. your price target is $17.

it's currently at, what, $19 and change. very interesting conversation. >> if 66% of your recent products have lost money, that's not -- >> that's not good. >> that's not a positive. >> definitely not. >> i still want to see penguins of madagascar. i like them. >> lemurs of madagascar. the ring-tailed legalure. >> on deck, the one sector that may be the most helped by lower gas prices and a fund manager's picks for the best stocks in that sector. >> and then ledge endary oil man t. boone pickens will be joining us on our show. what does he think about king abdullah's comment about oil prices? never going back to $100. stay with us.

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ask your doctor about cialis for daily use and a free 30-tablet trial. it's good news. it may be a sign of destabilizing. it maybe also simplifying the menu. >> while mcdonald's struggles, many restaurant stocks have actually posted terrific gains lately. dominik chu joining us with a look at some of the hottest of the hot restaurant stocks.

>> in the s&p 500 brian and mandy, there are some really, really good ones coming out of the gate in 2015, and we just wanted to highlight a few of them here just to give you an idea of what's happening. first of all, we all know what happened with starbucks. those shares are up big today. 6%. that puts their year-to-date gains just about three weeks worth of gains for starbucks at about 5%, 6%. that's a big move higher for starbucks. the best performing restaurant, if you will, stock in the s&p 500. the second best performing restaurant stock is another name very familiar to people in the audience here, and that's chipolte mexican grill. gaining in today's trade by a fractional gain here, but still, it's up 42% over the last year. again, up around 5%. just year-to-date. a very strong start for chipolte. then we got another one. along the different side of the spectrum for pricing and service. you look at darden restaurants. this is the parent company of longhorn steakhouse. this company is up 20% over the past year. it's also up a half a percent today.

these three companies are seeing benefitting from the reduction in fuel costs for americans and, brian, just -- i know you follow this closely here. the latest stats from the u.s. energy information administration say that the average u.s. household will save around $750 this year as opposed last year on gasoline. the question then becomes whete eating out more. right now the prevailing view from a lot of traders is that you could see restaurant stocks continue these moves higher if people continue to shop and dine out because of those gas savings. back to you. >> i have read a number of reports that have actually suggested just what you said. is that you get an extra $30 or $40 a month in your pocket. ure not going to go out and buy a house, but you might order an extra dessert, and rest raupts could be the single greatest beneficiary of lower gas prices. >> brian, to your point -- >> another round of margaritas, marge. >> when we emerged from the financial crisis in 2009, 2010, 2011, we saw that move higher. people weren't that sure about the economy, but if they wanted to celebrate anything, they just went out to eat as opposed to

buying some big ticket item out there. >> thank you very much, dominik chu. which restaurant stocks are worth nibbling on? david palmer is with rvc capital markets. david, before we get to your picks, just the general question about the gasoline savings. do you think that there is a direct correlation straight to the pockets of these particular eateries? >> there's been over time any time you've had gas prices go lower three months within three months, you start to see a consumer confidence boost, and that has a correlation. not a huge correlation, but a medium correlation with restaurant spending. that disposable personal income boost, the mood boost that you get from that. it tends to perculate into the results. right now we're not seeing a ton of direct pick-up from that. it feels more like weather. a lot of people in the industry are wondering if we start to see more of this in the coming months ahead. >> what do you mean weather? >> oh, the weather comparisons are -- >> because it's been good. the weather has been a mild winter is your point.

>> yeah. it's been a mild winter, and more importantly, two winters in a row we've had some serious stepdowns in results, and for instance, we're seeing weeks where the restaurant industry is up 8% to 10% lapping some of that trauma and very tough weather a year ago. >> let's get to your picks. starbucks came out with earnings. they were great. dom, too, just mentioned star buck as well. that's certainly one of your picks along with young brands restaurant brands international and duncan brands. talk to us about these. >> you know, some of these are global in nature, which is not exactly the place to be. in the case of restaurant brands, this company is a franchise business model. the old burger king guys, they are arguably transforming the industry in the large cap way and much like some of the smaller 100% franchise businesses are being run, and then dunkin, arguably, the peps where i to the coke that is starbucks, and in the coffee world in the u.s., they had a

tough year last year. we're expecting the results to get a little bit better this year, and then we've already talked about starbucks, and then young brands clearly a company that depends on its china business. about 40% of the profit, they've had a rough couple of years. really two and a half years where they've had some issues with food safety concerns in china. a recovery there will also help that mark back up. especially as its peer group has been running well ahead of it. it's poised for a major revaluation as china recovers. >> what about mcdonald's? do you think it's going to be able to enact this turnaround successfully? >> you know, mcdonald's clearly is dealing with a lot of the currency issues that's befalling many of these large cap names, and it's dealing with many of the big cap brand issues. you know, one of the things that people are struggling with that covered big cap consumers is the big brands are tending to be losing shares from smaller brands.

mcdonald's is no -- is not immune from that. they're trying to get better by being more local in the u.s. particular, which has been their biggest struggle market. things got better for them at the end of the year. they're dealing with some competitors that are doing stuff with value. taco bell, burger king, they gain share for them in the fourth quarter. january seems like those two chains in particular are doing well and taking it out of mcdonald's, but mcdonald's is going to try to do an old-fashioned turnaround. similar to what it did in 2003 where it redoes the menu, gets back to value. they're doing it locally. >> in fact, by the way, we'll leave it there, david. thank you. i want to remind our viewers, too, cnbc has an exclusive story up right now on cnbc.com from katie little saying that she heard with anonymous sourcing that they're going to knock off a bunch of menu items, and mcdonald's will try to go back to basics and simplify the menu. if you like the honey mustard snack wrap -- >> gone. >> it apparently is gone. the chipolte barbecue snap wrap and five or six other tumdz.

that's exclusive on cnbc.com. >> i would like them to bring some of the international menu items like the tear auky burger from japan and that's delicious. >> they have an interesting concept store in sydney, australia, apparently. it doesn't say anything. you wouldn't even know it's mcdonald's. not owned by mcdonald's. that is also on cnbc.com. >> it's more of the mccafe banner. sounds interesting. we're fwog reveal our stand-out stocks of the week. >> plus, the one and only boone pickens live on our show. he is going to be joining us after the break. i have the worst cold with this runny nose.

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between the fourth and fifth range. however it's inevitable that the price for oil will go up a little more. i think we will never see the price of oil at $100. >> that's prince alwaleed bin talal saying he thinks oil will fluctuate between $40 and $50. joining us, boone pickens who in december cold jim cramer oil will go back to $100 a barrel. his firm saw its commodity fund

jump 10% last year. i find this fascinating because the prince is not a representative of the oil industry, three years ago saudi arabia said they wanted $100 oil. >> what's the question? >> i don't know. i lost track of my own thought there. what do you think? are you sticking by your $100 call? >> yes, i am, but the guy there talking, he doesn't know what he's talking about because the reason the oil price has dropped, of course, is because production in the united states. that guy is from saudi arabia or wherever else he certainly knows what he has over there, and i think we know what we have here. and no question we were the ones that caused it, and we'll be the ones that fix it, and the way we fix it is our rig count will g down. you're going to lose -- we've

got 1,500 rigs drilling for oil in the united states. and in the last 30 days they've dropped 300 rigs. so, well, you know, brian, you have been in west texas recently and eagleford and i know you were in the bakken. so you've seen all of this. you see what's going on and you know that they can't drill for, you know, $45 oil. >> i do, but i know they can keep pumping at $45 once the capital costs are in. we got the latest rig count data and rigs fell from last week but when you look at the numbers, 43, there's not enough supply coming offline to change any supply demand in balance right now at least according to my math. what do you see? >> well, i know what i'm looking at, and we've got good numbers here. we didn't have a good year in a tough commodity deal in energy like we did if we don't know what we're talking about, and, yeah, what's going to happen to

you here, you're going to reach an all-time high on inventory of oil, and it will be reached within the next six weeks, and then it will start to decline. and you will be back up by the fourth quarter of this year, you will be back up to $70, $80 a barrel. >> if you think oil is going to go back up, you must be seeing quite a lot of investment opportunities in the energy patch. correct me if i'm wrong, i think you bought about three new stocks in the third quarter, western refining, wp x energy, and gas star exploration. what about recently? have you bought anything recently? yi think it . >> i think it's a little bit early. be patient and let the inventories go on up and you very well are going to see some more weakness in the oil price, and then it will be a time to get in, but that's coming up pretty quick. >> so it's too early, too early

to buy energy stocks yet? >> well, you're not going to make a mistake buying them, but you might get them at a better price if you just wait a minute. >> boone, let's talk about 1986. saudi arabia was pumping about 2.5 to 3 million barrels a day back then. they've tripled output since but when prices fell, they flooded the marke the market, destroyed the u.s. boil bo oil boom. >> they were not trying to bust an oil boom in the u.s. they were trying to bust the rigses. bill casey was cia director and he went to reagan with the idea that if we can get the saudis to overproduce and bring the price of oil down, we can bust the russians. >> you wonder if that's what's

happening now, but either way, boone, is this 1986 all over again? >> no, it's not '86 all over again. you're going to be back to what i said i believe it was in october i said that or was it december that i said that on jim cramer's show, and you'll be back up to $80, $90 a barrel here within 12 to 18 months. i feel very confident about it. >> i'm going to ask you a question. i'm guessing you're not going to answer me but i'm going to ask it anyway. i >>i'm going to answer you. >> good. what are you looking to buy in the energy patch? what are you waiting for a better priss ce on? >> i'm the commodity guy around here. i have got a little oil long and out in the distance, but that's my expertise, and the equities

are brian bradshaw and david meany, but it's -- so i can't answer that question. you're right. >> oh, it was worth trying, right? >> if i had had something i would have told you. >> i did, mandy. he said he has a little oil long. he has a barrel of oil in back of his suv, right, boone? >> that's right. you know something that's interesting? there's 300 million cars in the united states and cheap gasoline, it keeps the tank full. you think about that. and a full tank, 20 gallons on 300 million cars, 600 million gallons, that is 142 million barrels of oil. now, all the tanks weren't empty, but say it was half, that's 75 million barrels of

oil, and i can tell you they'll put it in the tanks. >> well said. boone pickens, have a great weekend. it was a pleasure to have you on the program. you did tell us something. >> is this all i get? >> that was already pretty much double what other guests get. >> the show ends at 3:00, boone. if you want to come on longer, come on at the top of the hour. >> okay. but you know, you all do this to me all the time. and i drove so far -- no, no, wait a minute, i'm on the phone. >> you're sitting in a silken robe on your ranch somewhere, we know. >> i'm sitting in my office. >> on a barrel of oil right now. >> good to talk to you, boone. open invitation. >> thank you, bye. >> coming up, stocks of the week.

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hp helps business move on all the possibilities of today. and stay ready for everything that is still to come. hi, everybody. happy friday and welcome to gelt. i'm kelly evans at the new york stock exchange. >> i'm bill griffeth. mixed day for stocks to close out another pretty good week for investors and there's another theme in our business world taking up a lot of oxygen right now. that would be currency wars. sort of a race to the bottom right now as it were. some huge moves in the euro again amid the moves in global central banks. all that affecting your money and we'll get into all that. >> today not a strong day for the markets after yesterday's bounce