gain, and now it looks like it wants to make its next leg higher. the stock isn't done going up. >> walgreens boots. bwba. it makes a more powerful. bought it today. >> that paper is monday, huge. today, huge. . >> that's it for us. power begins right now. halftime is over. "power lunch" and the second half of the trading day starts right now. >> welcome to power lunch. i'm tyler mathison. >> i'm mandy drury. >> it's up again today. well into record territory. how high can it go? he says still time to pile in. >> it's booming today. it has been a rough year in the nat gas down. the commodity down 33% over the past three months but up big today. it was up 7%. right now as you see it is up 3.5%. >> and if you want puerto rican triple tax free bonds, what point do you worry? what's the worst case scenario, and are these bonds even worth

the risk? okay. let's get you up-to-date on what's happening out there in the markets. guys, stocks have been you know, a little bit soggy. you is k see the dow and the s&p moving to the down side in fairly narrow trading, but the nasdaq is holding its head above water. not a huge amount of movement in either direction right now. as for oil, let's take a look at what's going on with oil. it is currently sitting to the down side by 1.6%. brent, meantime down by 2.6%. >> you might remember became the first u.s. corporation to hit $700 billion in market cap. it's just building on it today.

>> i want to say billion dollar val walkings at current prices. to put it in perspective, take a look at what that $724 billion means in terms of the size of other large cap well known stocks in america. first of all it's twice the size of microsoft. microsoft is around a $350 billion company. yes, apple is worth two times microsoft. it's awes bigger than four coke i don't colas. that's about the size what i'm talking about. four coke wra colas makes up one am. go even further. it's even more.

>> prizingly enough most of the people who reply were still bullish. there you go. thanks a lot, dom. >> investors are also focussing on an emergency meeting in europe between greece and its creditors. hedge fund titan telling us that the deal would obviously be good for the markets, but says stocks could survive even if it goes the other way. is he right? mike holland, chairman of holland and company -- with prince and securities group. you do agree? >> he is a bad person to vote against. i think, mandy, i remember in

2008 he pretty much called the bottom. he has been very successful. he is actually reflecting what the markets are saying. the greek markets went down. the rest of the world, including asia, says it's not -- if his -- i think within his comments was a 4% decline at the worst. if greece exited which people don't expect it's said that. >> here's the thing. if you take a look at the european markets performance over the past month, all of them with a notable exception of switzerland, because of the franc, they are significantly higher. greece is one of the best performing stock markets over the past month. it feels like the european stock markets are not only just taking this in their stride but they are not concerned at all. >> greece is just a one-off, if you will. if you live greece as it is. i think greece will and should exit the european union. i think we will see that happen. you have politicians working in

the financial arena, and that is not a good mix right now. that's the noise the market is reacting to. if we put it in perspective to the united states of america, we're talking about rhode island leaving the united states. it's not a big deal. the big deal however, why we saw the volatility in the equity markets in particular and then the sovereign markets, if you will, and the bonds as well is that if greece is allowed to get a haircut, we already have been told by the other lesser countries within the european union, and i'm sorry to say that would be ireland, we want a haircut too. that's the canary. that's where we're seeing that move. the canary in the coal mine, if you will. if greece is allowed to get away with a haircut and not pay their debt, that's what's going to happen. you should have been allowed it in the first sxlashgs we're going to set you aside and let you go on their own. five years ago i was with the two largest private shippers in all of greece. >> i'm sorry.

i have to break in here. >> sorry. i have to break in here. we're getting breaking news in the bond market right now. ten-year notes up for auction. rick, what are we seeing? >> well it was 24 billion tens and wreeld at the auction. no you can't make this up. 2.00 right on the notices. 2% ten-year. 2% coupon. i give the auction an a-minus. let's go through the internals. pricing right off the bat was aggressive considering the bid side of the one issue market was 2.014. solid pricing. 2.62 on bid to cover close to 10 auction average. it's the best level since december 2011. directs close to ten auction average of 12.7. dealers take 27.8% of the auction. this was very aggressive. there was a nice concession built with higher yields beforehand, and tomorrow 60 million 30s. i can promise you an historic day already. look for the lowest coupon at auction in history on that 30-year tomorrow. mandy, back to you. >> thank you very much.

the ten-year note currently yielding 1.993%. a-minus. okay. mike, just quick comment back to you. it feels like we're lurching from crisis to crisis whether it's greece or ukraine or whether it's something or somewhere else. to what degree do they have crisis for trooe, and are increasingly willing to look through these things? the market has become very resilient, mandy, and i believe that the path of least resistance now every time we get one of these headlines it scares people. >> you can also check out the tech world all on power lunch.cnbc.com. it's currently up there. i than he has some words on apple. the star of the day. okay. >> all right. thanks very much mandy. our next guest reminds investors to be cautious if you have any temptation to put some money into porto rubingo.

>> they shouldn't chase this, should they? >> no absolutely not. the yield tells the story, and the puerto rico story is one that unfortunately, continues to be more like a horror movie than one that's getting better with a happy ending. >> that is what i was going to ask you. this was a swigs that's been developing, evolving over the past couple of years. it reminds one a little bit of detroit. they tried to pass a bankruptcy act that was thrown out by a federal court. are things getting better there, or not better? >> well, they're not. it's different from detroit where you had just an erosion of the tax case over a period of decades. in puerto rico you have a different situation.

you have a structural imbalance. you have a massive deficit. you have an unemployment rate of 13%. you have a staggering amount of debt that's really similar to what we saw with european countries. $73 billion worth of debt. debt for operating expenses and the one that always makes me just scratch my head debt for debt service payment. so the situation is not only -- it's not getting better and, in fact, the latest thing that has happened is that a federal judge overturned a plan to restructure some debt saying that you can't pass a local law that overturns federal law, and why this is important is that there was a plan to restructure some debt and restructuring debt isn't great to begin with. it means you are actually not going to be paying full coupons on bonds and full maturities on bonds, but it was sort of going

to at least get the situation with puerto rico electric power authority bonds in some sort of workout and that was kind of going to get things to kind of get back on track in term of what was going to happen with the rest of the commonwealth. now that's on hold. there will be an appeals process, but as we know that's going to take a long time possibly a year so you saw puerto rico bonds get absolutely hammered. it does depends what bonds you bought. whether it's general obligation whether it's sales tax bonds, whether it's electric power authority, whether it's highway authority. however, there is one silver

lining. if you bought insured bonds. as we know in bond insurance companies, during the financial crisis were downgraded and people sort of stopped looking at insurance as being something that was meaningful, but here's the silver lining. you are going to get paid in full even if they're restructuring. you're still going to get your full principle. >> the principle back because of the insurance. the rapper right? >> if the bond insurance companies rated triple-a or rated b because of whatever they did, they have premiums set aside to pay those bonds. you are actually in good shape if you own insured puerto ricos. the value has still gone down but you should still be money good. bringing them into the dual investors. you should be feeling some comfort there. >> apple, powering high. the stock hitting new all-time highs. how much higher can the stock go, though?

let's speak with one of the most bullish analysts. plus nat gas soaring today, and prices are down. we have a five star funds manager whose nat gas fund is up 20% in that time. how he is crushing the market. what makes it an suv is what you can get into it. what makes it an nx is what you can get out of it. introducing the first-ever lexus nx turbo and hybrid. once you go beyond utility there's no going back.

welcome back to power lunch. one of the bigger gainers in the

large cap stock is all about the dogs and cats. all teepz of animals, in fact. they reported better than expected profits. zoetis sees good sales momentum heading into 2015 despite ongoing currency head winds. back to you. >> thank you very much dom. pepsi stock has some fizz today. the beverage giant beating earnings estimates and buying back up to $12 billion worth of its shares. wal-mart more than $270 million to expand in canada. the move creating 29 new super centers. you might remember though just last month rival target called it quits and announced it is closing all its operations in the same country. valiamt pharmaceutical getting the $400 million cash deal that's expected to close by the end of the month. ty. >> mandy, check out nat gas. prices are moving hire right now. heading for the best day in almost a month. there you see them up better than 4%. energy prices of course had been plunging over the past six

months. a little bumping lately. something still making a lot of money. we have a five star manager whose energy fund is up about 20% over the past year. we'll find out how he is doing it. plus -- >> up next "power pitch" a budding on demand start-up. >> we deliver gorgeous bouquets in new york and d.c. in under an hour. sfroo will this start-up blossom? >> how much do you make on a typical bouquet delivery? >> or will the panel nip it in the bud? >> a limited selection. how is this better for me as a consumer? >> stay tuned to find out. 1 12

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to me that feels great. ask your doctor if chantix is right for you. . >> file for the power pitch. with valentine's day around the corner we gave one entrepreneur just 60 seconds to convince a panel of experts that his flower delivery start-up is the next big thing. >> co-founder of urban steps. we deliver gorgeous bouquets in new york and d.c. in under an hour starting at just $35. sending flowers on-line today relies on a really inefficient process that as anyone who has sent flowers on-line can tell you, can be really frustrating. i know because i was almost broken up over a birthday bouquet that never got there. you also have to order days in advance, and the bouquets rarely look like what you ordered. the worst part is that it comes out close to $100 when you include all fees. urban steps is revolutionizing

flower delivery in urban areas. ordering is simple. you pick from one of our curated bouquet on our app or on-line, and we'll deliver it in under an hour. we'll also send you a photo confirmation of your bouquet outside your recipient's building. all of this starting at just $35, including delivery. the process is so fun and affordable, we've been growing by double digits month over month. help us in revolutionizing an $8 billion industry, but more importantly, making it fun again. >> welcome to today's power pitch. i'm mandy drury. you just saw the pitch, but now let's meet the panel. with us today is -- that's a fund including task and delivery service instacard. on set with us is kelly, an angel investor and advisor to early stage companies, and as a new yorker she expects everything to be delivered in an hour or less. in the bay area jenny lefcourt that focuses on seed stage investments and venture capital fund freestyle, and she's also

no stranger to finding the perfect flowers. jenny founded wedding channel.com, which the knot acquired for $90 million. r.j., you are in the hot seat i have a bouquet of your beautiful flowers here as well. would you like to throw out the first question? >> you said it was an $8 billion industry. that makes me think that customer acquisition from the incumbents is really expensive and so how do you plan to break through there? >> the incumbents do spend a lot of money, but our value proposition to the consumer is so much better that we have seen and truly believe that we're able to deliver an experience that's widely talked about and as soon as our customers try send ouring flowers, they immediately tell their friends -- >> we've already heard picky new yorker. you have a limited selection. how is this better for me as a consumer? >> we always have a need for bouquet that is are a specific color or for a specific purpose that we mapt be able to fulfill, but for most people who are just looking for a great bouquet during that season well we'll

have picked out something that you don't have to worry about. >> looks like on the website you only have three choices of bouquets. is that right? >> yes. >> and you want to keep it that way, or are you planning on adding more? >> we may add a couple more but we've actually found that customers love the option of only having three things that are highly curated just for them? >> talk to us about your margins. how much do you make on a typical bouquet delivery? >> sure because we've cut out so many of the middle men in this process, we have actually -- we actually have quite high margins. close to 50% on our margins. >> does that include shipping -- i mean the delivery? >> world of just in time or on demand delivery is extremely well funded and has exploded recently. what's to prevent other players from coming into your space? >> we have integrated our supply chains. we select from the best farms, and because we're able to cut out really all the middle men, we're able to talk about price that any of those services would never be able to offer. >> how are you picking your partners? >> one wrong delivery boy, and your brand is out the window. >> we do a lot of training with

our delivery personnel. we know that final experience of being handed the bouquet is one that really matters to the person getting the flowers and the person sending the flowers. >> what percent of your orders are on demand versus scheduled gin that that's such a big part of your offering? >> when we first started, they were mostly scheduled because people didn't really expect to be able to send flowers within an hour, but now that we've been around for about a year our customers are pretty trained and know that they can order at the last minute, so that percentage is actually pretty high. >> we will all heard what r.j. had to say and now we need to know if the panel is in or out. >> i think it's interesting that the vertically integrated supply chain. i think that's smart. i like it going into an $8 billion market. i worry a little bit about them having competitors, but otherwise, i am in. >> okay. we've got one in. what about you, kelly? >> i like this is urban, this is mobile. they are very defined who their market is as well awho their brand in is and a strong brand proposition.

i also really like this founding team. it's a little early for me so i want to keep my eye on them so i'm out. >> jenny? >> i'm concerned with how competent tiff the market is. both the big companies and there are a lot of floral start-ups. i think it's going to be challenging and expensive to gain significant market share, so i'm out. >> well one in two out. what's your reaction? >> it was grate feedback and this is really fun. thanks for having me. >> thank you very much to r.j. of urban steps. also to those on our panel. that is today's power pitch. >> so do you agree with the panel? let us know if you are in or out on urban steps. you can tweet us using the _#power pitch. for more you can visit power lunch.cnbc.com. by the way, ty, i just wanted to give you another power pitch update because back in november casey elsas pitched his brooklyn-based start-up called mixed maid claiming his bees knees spicy honey is the next big hot sauce. it's infused honey.

he tells us his appearance on power pitch led to one of the start-ups biggest single day of sales. he has gone to still 18,000 bottles now shipping to all 50 states and 27 countries. some things vbt changed. those bolgss are still all hand filled one by one by casey and also some volunteers and mixed maid remains funded and profitable. big congratulations to casey and his team. i should also say ty i have some at home. i love it. it's great on cheese. it's not for the faint of heart. it is spicy. it is more like chilli infused with a little bit of honey. >> it is hot sauce. it really is. i tasted it here on the set. it was good. i'm not sure how i would use it. you give me an idea there. it was spicy. >> it is. >> let's go to spicy dominik chew for a market flash. >> i will have to get my hands on a bottle of that as well. a trade that's not spicy. we're just minutes away from the gold closing and right now gold and platinum prices are down by

about a half a percent. if you look at silver and copper, they're down by close to a percent on the day so far. that, of course means our daily check here on the gold mining stocks as well. if you look at names like barrick gold newmont mining and ashanti, all of those stocks are lower today on the heels of those lower gold prices. as we approached this close, gold down about a fraction. about a half a percent and right now tyler, we're seeing the gold stocks down along with them. back to you. >> thank you very much. about a half hour ago we had the bond auction. now he has the full bond report. rick santelli at the cme. hi, rick. >> tyler, we're up about 36 basis points since the end of january. indeed there was plenty of demand. look at the intraday. it's rare you could pick out when the auction went off on an intra day chart. you can essential see it was an aggressive auction. i gave it an a-minus. since about the 8th of january. look what's going on at foreign

exchange. there's a euro versus dollar. i picked the 29th of january. it looks like today we may close under 113. dollar-yen now over 120. every major currency doing a little worse against the dollar. greenback having a good day. mandy, you always have a good day. back to you. >> i do have a good day when i see, ricky. >> a big pot problem on its hands. it's not what you think. jane wells is live in vancouver. jane. >> hey, mandy. this is the organically blown power kush. why isn't this happening in colorado? growing pains in the pot economy when "power lunch" returns.

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hi know. i'm sue herrera, and here's your cnbc news update for this hour. president obama will deliver a statement at 3:30 p.m. eastern time on the formal request he sent to congress today authorizing the use of military force against isis. you can watch the president live here on cnbc. once again, that statement is expected at about 3:30 p.m.

eastern time. meantime, the justice department says pharmaceutical maker astrazeneca will pay $7.9 million to settle kickback allegations. the department says former employees have alleged the company agreed to give price concessions to a pharmacy benefits manager in return for keeping some drugs on an exclusive list of approved medications. and a bankruptcy judge has refused to extend the deadline for the revel casino to be sold to a florida developer. the same judge did not rule on the casino's request to terminate the sale. the casino wants to find another buyer, but it is also looking to keep the developers $10 million deposit. the judge will rule on that next week. now on cnbc.com what to do if you win that $500 million powerball jackpot. hey, you never know. i'm sue herrera. now back to power lunch and ty. >> i don't think either of us need an article to tell us what to do. >> that's true ty. >> let's take a market check, shall we?

it's 17,774. it's a half percent. nasdaq basically flat at 4785. s&p 500 at 2059. that's off a half a point. percentage point i should say, or 8.5 points. well, 2014 was a strong year for technology, but it has reversed course so far. in 2015 tech is one of the worst performing sectors in the s&p. exceeded only by financials in the negative column or the not performing well column. profit taking disappointing earnings forecast currency headwinds, you name it. weather. who knows? just some of the factors weighing on the sector's biggest losers. apple, of course has been one of the bright spots of technology. the stock all-time highs post lit up by 10% so far in 2015. side kick stocks. before the earnings report and the debut of the -- are you wearing a smart watch? >> i wish i had one of the smart watches. i tend to be a more classic

watch girl. i'll check it out for sure. really as you mentioned, it's all about apple. take a look at the market cap. it has a market cap of $722 billion today. that is the highest ever for a u.s. -- it's huge. >> bigger than powerball. stroo that's what you can do with your winnings. put it into apple stock. anyway, that's been fueled by earnings that just trounced wall street estimates last month. when apple does well it also tends to boost the supplier. that's a dynamic we're going to call the iconomy. we screened stock performance of apple suppliers to see how they fair following a beat like the one we saw last month. since 2005 apple's top expectations by 5 cents or more 17 times and in the trading month that has followed we have seen semiconductors performing very well. in response to that. take sky works solution. this is wireless chips for the iphone. in the month following an apple beat, this stock gains 71% of

the time for an average return of 6%. another name to check out, texas instruments. that tops 65% of the time and on average it gains about 2% in the month following strong apple earnings beat nxp semiconductors, that's another name to look at it and it makes the chips to support apple pay platform and since going public in 2010 it's jumped 64% of the time, and the average return for that stock 1.5% in the month following. how are these stocks fairing since apple's january 27th report? well, take a look. we've got sky works. that's up about half a percent. texas instruments, up 2% so far since january 27th. nxp is the winner here. it's up 6%. some other suppliers that analysts are also watching closely. it tends to do well and tends to gain following a strong apple earnings report.

samsung reportedly supplying the main chip for the next iphone, and another name to check out, maxim integrated products which is widely expected to contribute to that smart watch, which tyler, is due out. >> there's samsung. i assume that's in yen. it's got to be. how ironic -- how ironic is it that samsung is going to give the chip to the phone that is their rival, right? >> frenemies, right? there is one analyst at jp morgan who is very -- i do mean very bullish on apple. the take is 20 minutes away. >> thanks ty. >> after falling more than 40% over the past year. forecasters calling for below average temperatures over the next two weeks. how do you play that right now? joining us for power lunch exclusive is skip else worth, co-manager of the index fund -- over the past year.

good to see you again, skip. natural gas was tracking for its best day in almost a month, and whether 2000 are saying that february could turn out to be the coldest since the 1970s for the east-northeast and the midwest. what is that going to do to nat gas prices from here? >> well, i think we're going to see the short-term little spike. nat gas prices move the most on weather issues, and in terms of short-term issues. once we get through february and let's say halfway through march, i think we'll be going into what they call a shoulder season and inventories will come back and up prices will stay in this $2.50 to $3 range. >> production has been at record levels as well. you think it might just be temporary. what does that all mean for your fund, which i understand focuses more on the distribution side as opposed to the exploration side of nat gas, right? >> that is correct. so the emt side the expiration production is more sensitive to

this -- to these prices and the distribution side not so much and it's more about the growth of natural gas conversion of power plants to burn gas, things such as that. home conversions. historiedically looking at ten years ago, but the price of gas was $10, $12. $2.50, $3.50 range, we're at historic lows. we have lots of supply. what do you make of the outlook for utilities in general? like the s&p utility sector is the biggest decliner today out of the sectors. i think it's down 4.5% over the past week.

it's singestive to rising rates. when rising rates happen that's a negative on utility stock. more importantly, though what is the utility involved in? utilities can be involved in simply producing electricity. they can be involved in the natural gas business. the underlying industry you are investing in is really what you are relying on for growth and so the gas fx is up. transcanada and kingdom always good to know what is inside the index. skep, good to see you. ty. >> thank you. >> mandy a moment ago i said that samsung was denominated in yen. who knew? chew knew. i was wrong. it, of course, was denominated

in korean. three letter had every word. to house and some surprising data on jobs and homeownership. diana in washington with the details. hi, di. snoo hi ty. look job fwroet is going to juice housing. maybe not. employment is increase, but not in the sectors where employees typically own homes. they look at by profession and seeing the most in the least job growth. they found that many of america's fastest growing careers in terms of numbers of workers have average or below average homeownership rates. while the profession with higher homeownership rates are headed for average or subpar job growth. now, the bureau of labor stat stis i objects has food preparation and cashiers. low-paying jobs. workers in these professions have homeownership rates below the national average. big homeowners like engineers, lawyers, doctors, and computer and math professionals, higher paying jobs are seeing only average job growth and business managers who are big homeowners

they're seeing subpar job growth. the glaring exception? nurses, big job growth big homeownership rates. this all may be why higher employment is not driving higher mortgage applications to buy a home. down last week for fourth straight week. now, we have a very nifty interactive tool on-line where you can see how your profession rates. realty check.cnbc.com. >> those are fascinating numbers, diana. thanks very much. really interesting. nurses have high homeownership. washington state has a pot problem. there's too much of it. jane wells, who seems to do a lot of stories about pot, is live at a marijuana farm in vancouver, washington, with that story. hi, jane. >> tyler, it's all business but this is legal and cheap. unprofitably cheap. different states with legal marijuana are trying different models, different tax structures, different licensing requirements. the model in washington has a problem. so much so that farmer tom lowerman may not get these seedlings in the ground for his crop. he is forced to sell his 2014

crop at below break-even prices. they're moving to foreclose his farm because of this glut. now, why is there a glut? well washington has a higher tax rate on its pot in colorado does, and there's more competition from untaxed illegal and medical marijuana in this area than compared to colorado. plus, lowerman points out that in washington they've been handing out grower licenses more quickly than retail licenses. >> a combination of the two, the influx of the weed coming in from california and southern oregon along with the tons of growers who are growing thousands of plants outside, the extended season there's 45,000 extra pounds floating around out there with no home right now. >> now, there is a whole lot more of the difference between washington and colorado right now on cnbc.com but this is not that different, mandy than the california wine grape glut we had a decade ago when which led

to 2 buck chuck with 45,000 pounds. legal stuff maybe someone will create two buck toke. >> you can only hope? right. two buck cluck is great. quality wine at low prices. who doesn't want that? let's go to dominik chew for another market flash. >> i love jane wells and her stories. pharmacy stocks here moving higher with the news that rite aid will buy envision for $2 million. rite aid up 10% in today's trade. you can see they're off 9% here to the up side. also, cvs, walgreens, boots alliance, and express scripps moving to the up side here in today's trade. rite aid's deal should help the company in growing areas of specialty drugs and medicare prescription drug coverage. back to you. >> thank you very much dom. well americans renouncing their citizenship. love is in the air at work, and a follow-up on social media faux pas that got a jeb bush aide

fired. that is all coming up next in the power rundown. in my world, wall isn't a street. return on investment isn't the only return i'm looking forward to. for some every dollar is earned with sweat, sacrifice, courage. which is why usaa is honored to help our 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.

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for a free 30-tablet trial go to cialis.com time for the power rundown. frankie is here with us today. robert. the treasure department finding now that more and more americans are renouncing their american citizenship. why are they doing it? >> it's a record number. over 3,400 last year. that's three times the level in 2012. now, part of it is just pure tax avoidance, right? we've heard about tina turner moving to switzerland. edwardo of facebook moving to singapore. a lot of it is the biggest regulation you never heard. it means if you live overseas if you hadn't been in the u.s. for decades, you have to file a return now and they're really strict about it. a lot of it is americans who -- >> or any income that you have

overseas. >> you raise the issue of singapore when i was living in sing for for eight years. i had a lot of american friends. you would have been one of them back then. an american in singapore said that despite that singaporeans, they still had to declare their foreign income to the u.s. treasury department which was very, have annoying. i would imagine a lot of people renouncing are such ex-pats. not necessarily americans living here. >> it's not people really picking up and moving. they've already been there. the long arm of the irs is getting even longer. that's the bottom line. >> let's talk about something a little more sort of airy here. canolgdzing co-workers. is the stigma of the office romance as dated as the power suit? >> i hope not. i love office romances. i met my wife in the office. >> i did too. >> we look our best. we're at work all the time. presumably we're at our best behavior at work. you know as long as you keep

the pda's at home -- >> i also think some of the lines between work lines and home life is being blurred by the fact that you kind of expect to be connected 24 hours a day, right? there isn't that sort of like this is my work and that's my personal life. it all just sort of blends in. >> yeah yeah yeah. sfroo parting such tweet sorrow for one jeb bush aide fired after a string of very inappropriate social media comments were revealed from his past on yesterday's rundown we told you how bush's newly appointed cto scramble did delete disparaging remarks. tweeted out years ago. apparently the damage control was too late. well l folks ever learn? he did step down saying he can't overcome this. >> yeah. i think this is jeb bush learning just how high the spotlight will be. anyone that you appoint, even at a low level, is going to be picked over with a fine tooth comb. i think hillary's campaign at least in the beginning, will be a little more practice with that stuff. jeb has to get used to what it's

like to be in a presidential election and that is a rigorous process. >> the scrutiny of all your people. >> absolutely. >> incredibly intense. >> that's the power are andown. on to dominik chew for market flash. >> tyler, guys shares of general financial are one of the top performers of the s&p despite coming off of their session highs. that's after the insurance company reported a smaller than expected loss. helped along by a smaller than expected loss at its long-term care unit which has been a huge area of concern for investors. long-term care is the part of the insurer that helps pay for elderly care like nursing homes. unfortunately, the company also said that it plans job cuts to help control costs. still, those shares up by 4% today. back to you. >> thank you, dom. >> well is it right for the president to directly call out an american corporation? he did telling staples shame on you for using health insurance costs as an excuse to cut back on workers' wages. that story is ahead in the second hour of "power."

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>> significantly expands the product offering. yelp is viewed by many traders as a moments yum stock, and it's not been positive. year-to-date they've lost 17% and have lost half their value over the past 12 months. back to you. >> all right, dom. here this hour's power points with apple hitting a new all-time high today. here's a key stat. if apple, the company, were a country, its gdp, if you took its market value and converted to gdp, it would be the 55th biggest in the world. i wonder who would be ahead and below? >> fears height might correlate to homeownership. especially true for nursing. nurses have high ownership ratios. and natural gas could be in the $2.50 to $4 range over the next 12 months. that according to the five-star fund manager skip alseworth who you interviewed zoosh i did. minutes ago. >> if you missed the big stories in the past hour, go visit our website, powerlunch.cnbc.com. a lot of breaking news on hack

attacks during power yesterday. what about the tashgs on u.s. companies that constitute a real problem for american industry and what's the tipping point? i would say they already are.

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on deck for the next hour. why jp morgan analyst on apple is so bullish on the stock? should the president really be shaming a publicly traded company? well he is. think oil production is going down? you might want to think again. we've got a stat you have to hear. now to sue herrera with the news alert. >> thanks, brian. a big deal in the commercials, specifically office real estate sector. blackstone through its new core fund, core plus fund specifically, is close to buying a 50% stake in rxr realty portfolio of new york's office buildings. that includes it's a deal about $4 billion that includes six office buildings, including the iconic lehigh building on manhattan's west side. once again, it's about through the new core plus fund that blackstone launched, which has amassed to date about $3.5 billion worth of assets. they're trying to basically bridge the gap between core holdings and some riskier holdings that they had in that

particular fund. mandy, back to you. >> thank you very much. sue herrera. let's bring in aemon javes. seemingly every day there's another hacking story to report about. what point do these constant threats become -- i know it's already a problem, but a really serious problem for americans and american industry. have we reached that tipping point? >> such an interesting question because we've seen quite a run of cyber security news. over the past 24 hours or so we've seen delta see its facebook page hacked. we've seen newsweek see its twitter feed hacked by somebody apparently supporting isis. we've seen forbes.com say that it was hacked by attackers who were apparently targeting the readers of that website, and when you look at these, you have to kind of separate them into different buckets. those attacks that are core to what a business does and are going to cost it a lot of money versus those attacks that are at least on the surface anyway appear to be just cyber vandalism. as companies look at this, they're going to look at what it's going to cost to fix the security problems to fix the

internet more broadly versus what they think they're likely to lose and you have to wonder whether or not companies are making a mercenary calculation there about exactly how much they think their particular company is going to lose. although sony and anthem certainly big wake-up calls for corporate america. >> okay. eamon, stick around. let's bring in someone who does like a debate or two, someone who has an opinion on every single topic. that's a good thing. >> stwloo yesterday we had a twitter hack. it was harmless stuff. it was indeed hack and started sending out material nonpublic information that people then traded on. do they have to invalidate trades while they figure out what happened? >> fas nate naturing question. presumably, it would hinge on whether that person was involved in the attack or involved in sending out the information. the legal liability there

wouldn't be for the person who was hacked. it would be for the hacker. then the inside information that was put out into the public marketplace, this would be an open question for the s.e.c. exactly what to do with that and what to do with the people who traded on it. as we know so many trading algarhythms are looking at that. we saw that when the ap twitter feed was hacked a year ago or more now, and the instant reaction we saw in trading to that hat. yeah, this can be a material issue very quickly. >> that was a feed about a news event or an alleged news event where they said the white house had been attacked or infiltrated.

>> the open free ranging exchange of information. that's the underlying architecture of it. the other problem is human beings are part of the internet. when are you talking about spear fishing attack who is using that computer who thinks, uh-huh there's something real here, and they fall for the trick. >> the little table that i am going to use, you are logged on in, and your twitter was up, and i was so tempted. sully cnbc is a great guy. he is -- i can't tell if he is so handsome or nice. >> with smiley face emoji. >> i logged you off. >> what a good man. >> you are already a fixed human being. no need for fixing there. thank you. >> and on that happy note folks -- >> luckily, i'm fixed. >> the first hour of power, and brian is here to take it away. brian. >> thank you both very much.

have a great day, guys. it is about 2:00 p.m. now on wall street. it's lunchtime in denver. you are watching the second hour of power lunch. i'm brian sullivan. we have melissa lee at the nasdaq. the first thing on our plate this hour a little $700 billion company you might have heard about called apple. rod hall is an analyst at jp morgan. he just raised his price target on apple today to $145 to $140. he is increasing estimates. he is reiterating his overweight. all right, ron. all this good stuff. is there anything at all that you are concerned about with apple. >> the thing i'm mostly worried about and, by the way, thanks for having me is whether they can make enough watches or not. that's a the main problem i think they've got. >> do you believe that the apple watch is going to be a hit because we have seen estimates for sales of other so-called wearables come down. all this hooplah over wearables has tapered off just a bit. you have to admit. >> yeah. i think you're right. you could think about a smartphone. we have a lot of examples of

smartphones that came out early on. the nokia in 1995. they didn't really sell that many units. all of a sudden the iphone really hit the sweet spot with consumers and took off. we believe that could happen again here with the apple watch. you came out with a good product that re-establishes or establishes a new category that can really take off. >> who is going to buy the apple watch? you sort of back into it and say, you know what the pool of eljinl buyers and the people who have the iphone 5 and up. that narrows it down to about 400 million people and then you assume a percentage of that 5%. i'm wondering how you get to that 5%. how do you know that 5% of even the people who are eligible phones will want this piece of hardware? >> you almost need something. >> think a lot of people will be surprised to know there are 400 million people of iphone 5 or

better. about 580 million people that have an iphone so there's a huge user base out there. we think a 5% penetration level by the end of this year is pretty conservative. you know, if you think about the kinds of people that own iphone and the kind of value that something like an apple watch would bring to those people we don't think this is an overly optimistic number and that gets us to 26 million units. what's interesting is that group of people the 400 million grossed at 525 million by the end of this year. then 627 million by the end of next year so that pool of addressable users who could buy a watch just keeps climbing pretty rapidly. >> you know rob, we've gotten to the point now where we sort of almost assume that everything apple does is going to be a super worldwide global fantastic hit, and to me that makes me nervous. >> yeah. i think that's a fair point, brian. i would tell you, though that having worn that's wearables, a number of them the pebble i'm wearing a microsoft band right now. you know testing these things

out. there is quite a bit of value they bring to the table. not only in the form of just notifications and having all the stuff your smart watch has but on your wrist, but in the form of health track and other applications that i think a lot of consumers are going to like. >> all right. we're going to leave it there. thanks for your time. appreciate it. >> thank you melissa. >> thank you. >> brian, you know, we were talking about apple being such a juggernaut. i want to show you apple since the split. the split happened just around here at the $90 or so mark. take a look at what it's done since then. it's gone up 34% since that split level. we should mention also that analyst, rod his price target on the saw is $145 a share. he sees quite a bit of up side from where it's trading right here. >> all right, melissa. very good stuff where like. like that telestrating. >> we have a tech trifecta for you. first, apples to apples comparison who really made apple the biggest company ever. plus, a big red flag for android

lovers and maybe just how vulnerable twitter really is or isn't to cyber attacks. let's go ahead and starting with apple. lost in the apple record high conversation is this rather interesting nugget. ceo tim cook has now added more market cap to apple than steve jobs did. let's bring in herb greenberg, partner with gvb and tony chance, magazining partner, a guy who builds companies for a living. nobody is knocking steve jobs. he was a genius and he built the company basically out of bankruptcy. do you think that tim cook does not get enough credit for taking a successful company and making it already more successful or maybe just not screwing it up? >> yeah. i think the jury brian, was out when tim took over. >> he took a lot of heat. he took a lot of heat. >> he did take a lot of heat, and i think you have to give him credit. he has done an incredible job. the market cap has doubled to a $700 billion high. he had the benefit of steve jobs' legacy platform, and, of course, a great market. i think he deserves all the credit and more. >> yeah. herb greenberg, you got a view

on that? >> it was tim cook's to lose, and he didn't lose it. so you could sit here and you could say, you know he is not steve jobs but to try to pick the other side of that battle would be fool hearty and every year we go -- every year post-steve jobs people are going to try to say, you know this is it. this is all tim cook can do. this is tim cook's company. >> when they have to stabbed on the shoulders of giants they have to follow what somebody. >> finding his own way to define success. steve was brilant as a marketer. brilliant as an innovator. cook has done that.

>> i think that's all him. >> topic two now. the red flags perhaps for iphone competitors. >> so new shipments would automatically go down and it's not necessarily a bad thing for android. >> yes. it's also you're all in. there's only so many you can sell before you stop going the other way. >> you cannot afford to buy an

iphone, and now the iphone has become a must have or a want by people who can't afford it and they're going to find money to get it. they had to follow-up and do something better. how much of it is imitation versus revolution or evolution? >> i think in our effort it's more similar to the iphone ios market where we believe consumers will always trade up. snoo they still have many many more. what the market is saying that in a great economy people will trade up. we thought that in china and

other places that greater price sensitive, we thought they would trade down to good android products. they're buying up to the iphone 6 and 6 plus. >> before we get to topic three, i want to follow-up on that. you are trying to build out maybe higherend series of salons. can you still drive margins even in this economy? what does it take to have a little premium luxury pricing power today? >> the concept are you talking about is mini-luxe, which we were grateful to raise $23 million star bucking this nail salon concept. it's a cheap luxury. it's not like an iphone that's going at $687 and has about a $ 00 gap with android. we're trying to trade people up for something that maybe $12 $13, to a $20 price point. people pay for the extra luxury as they have with a starbucks coffee going from a cup of joe at 50 cents to $3.35 for a tall skim latte. >> twitter's troubles. herb greenberg, we talked about it yesterday.

anthony, looks like noto clicked on a bad link. what if somebody got data information on any publicly traded company and then you have people trading on that. prooet pretty soon you have millions of people who made trades that should publicly traded executives be on twitter. >> it's fine, brian. i'm not -- i'm not really worried about that as an issue. in fact, you know i think that they're going to be issues with not just twitter, but with any link somebody gets in the e-mail. are you doing 50 things. you've let somebody in. i think -- you can only -- >> there's nothing on the internet that will help with ad reduction. your six-pack is already well defined. you don't need anything else. tony, what do you think? twitter took some heat. noto took some heat. maybe it's harmless but maybe not. >> unfair rap. he is only human. tech is not. as herb said you know all of

us have made that mistake to hit send, to hit tweet before we want it to. i think the one thing it does raise if are you senior executive, do you want to contemplate having the two factor authenticate which he did not sign up for, but i think that's something we are all going to be moving towards. having double authenticate for any type of sign-in, especially when it goes out to the public. >> smart advice. tony, by the way, if i came out with herb greenberg, six minute airbornes a dvd product. would you back it? >> you bet. just for you, brian. >> this is power pitch two in the second hour. thank you very much buddy. >> certainly there will be a lot of focus in terms of the fourth quarter and full year numbers when it comes to deliveries and production and also model x and when it comes into production

later this year. that's down 7% compared to a year ago. i should point out, i talked to a number of people saying look we are expecting something closer to 39 cents, 40 cents a share. that's somewhat of a whisper number. revenues, expected to increase 61% compared to a year ago, and coming in about 1.23 billion. as you were mentioned, china, especially in light of the report that came out yesterday, citing an e-mail according to reuters where elan musk said everybody needs to get on board in china or there's going to have to be a shake-up of executives there. we do know that the head of communications left the company not long ago, and there have been -- there has been a fair amount of executive turnover if you will as tesla tries to find the right combination of executives to lead them in thooin kwlooirn according to reuters, elan musk sent an e-mail threatening a staff shake-up. we'll see what they have to say in this earnings call regarding china. we know that the fourth quarter was want strong. elan has been out there saying

that the fourth quarter deliveries in china went down. the question is what's happening right now? is january a az slow as some are expecting, or is there some sense that they have stabilized the situation? >> the release is going to be different today because they did push out the earnings release to 5:00 p.m. eastern time and it ordinarily happens earlier than that, the conference call doesn't start until 7:30 eastern time. we weren't even hear from elan musk when it's trading in the after hours session. because of space ex. how will this be in the analyst participation? >> i don't think it changes it at all. more than anything what it does is make everybody wait an hour and a half. they made that decision yesterday at tesla once the space x launch was moved so that it's happening this afternoon, early evening, and as a result elan musk wants to be able to see it. he said hey, let's move the conference call back to 7:30 eastern. it means people like me get to spend part of their night tonight listening to elan musk. >> okay. phil, yeah that's going to be a

long night, but let's be clear. you also got to drive a tesla in their new setting called insane mode, which allows zero to 60 in 3.2 segdz for all of us that do not have the privilege to do that. what's it like? >> it's a rush. it's a complete rush. my photographer bob who was sitting in the passenger seat throughout all of this every time he was thrown back in his seat. he got used to it after a while, but the best part is the reaction that you get from people when they don't know that it's coming and you first hit it and you do go zero to 60 in 3.2. it's amaze, amazing acceleration that you get in the p 85d. that is clearly the talker part of that car if you will. everybody wants to talk about it. my friends when they saw me driving this vehicle over the last few days they said hey, can i hop in? tut putt it in insane mode. clearly a lot of people know about it, and they want to experience it. >> do you remember the time phil, that last year i think it was or two years ago you were testing out the tesla range, and

i was driving on the new jersey turnpike, and he turned and there you are. hey, that's phil lebeau. >> you know what the performance version, guys performance version is a big increase in terms of what you are getting compared to the standard model s. >> very cool stuff. phil, thank you very much. melissa, see you in just a second. right now let's set the menu for the rest of power lunch on this wednesday, february 11th. one fed president lashing out at the fed. it's causing a big controversy many monetary policy circles. that's on deck. plus a new kinder gentler, corporate policy, maybe upon us here in the usa. this review season. does nice really work? president obama and staples, the retailers square off. angry words exchanged? it is over all hours and the future of american business. more power lunch.

>> hi i'm sue herrera. breaking news right now concerning ukraine. as you know there have been some peace talks taking place in minks as they try and come to some resolution in the conflict in ukraine. right now we are hearing from a ukraine yan delegation source that there seems to be some progress in the talks. basically what is happening is the four leaders are pledging support, if you lshgs for

ukraine's sovereignty according to the ukrainian delegation source and they are also affirming the resolution that was passed in september, but keep in mind there have been resolutions passed in the past and they have not held so right now it seems like there's a little bit of progress brooen towards a resolution, if you willing, or at least more talks about a resolution for ukraine. it's a little foggy, but we're keeping our eye on it. >> thank you for bringing it to us. still down 50. not moving necessarily on the headlines, but they are fresh. wait and see. >> meantime dallas fed bank president richard fisher wants to overhaul the fed. steve liesman is here. why does mr. fisher want this? >> he does not minutes words when he started at the fed in 2005, and he is not minutesing words now. in a flow voktive speech last night, fisher suggesting the federal reserve has a tin ear to its critics and needs to get out front and overhaul the fed. his big concern, the power of the new york fed.

here's what he said. >> rotate the fomc chair now held by the new york federal reserve bank that has a permanent vote. get six district bank president vote and six governors vote right now those bank presidents are on a rotating chair. the fed chair would vote to break a tie. then regulars late the big important financial snugs in separate districts from the ones where they are head quartereded.

>> fisher is bringing up an important point. this federal reserve system as it was structured came from 1913 and then again it was overhauled in the 1930s. i think this in part it's time to change it. there are two banks in missouri as you know. the west is under represented. the south underrepresented. the northeast probably overrepresented. he talks a lot about that distribution. in terms of being more of a democratic organization, the fed should be overhauled. >> the general island branch. don't get into that. >> thank you, steve. up next did rite aid make a wrong move? we'll debate that with point counter point, and fresh video that includes tax season doesn't bring out the best in all of us. oh, wow. power lunch right back. hey, girl. is it crazy that your soccer trophy is talking to you right now? it kinda is. it's as crazy as you not rolling over your old 401k. cue the horns... just harness the confidence it took you

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the rest is up to you. call now, request your free [decision guide] and start gathering the information you need to help you keep rolling with confidence. go long™. ♪ >> dunn and bradstreet information broir d & b. the stock is up today. it's up this week. in fact, it's one of the better performers this month on the s&p 500. upgraded the stock today. d & b has been a quiet winner. >> all right. thanks, brian. let's get to sue herrera with

another news alert. sue. >> melissa, we have a sentencing in the trial of the captain of the coasta concordia. as you may recall back in january, january 13th actually 2012, that terrible accident occurred off the coast of italy. now, an italian port has found captain francesco fwlt for his role in the ship wreck of the cruise liner. it killed 32 people. that accident did off the turfingan island. >> however the court was seek being basically a sentence of 26 years.

>> brian, back to you. >> sue herrera, thank you very much. all right. coming up, a shocking stat on u.s. oil production. you got to hear it to believe it, and speaking of oil, the final trades are about to cross this very moment. we are headed live to the new york america tile exchange where oil will close when power lynch returns. while others go in circles... and repeat themselves... we choose to carve our own path, in the pursuit of exhilaration. the 306 horsepower lexus gs. experience the next level of performance, and there's no going back.

>> hi everyone. i'm sue her air wra. there will be a formal request that you sent to congress after using military force against isis. you can watch the president live right here on cnbc once again. that statement expected at about 3:30 p.m. eastern time. >> the finance minister is set to unveil his first proposals to lighten the bail-out program. the market is watching that very closely. here at home, stroke experts report aing major advance today. stints that are similar to the once used to open clogged heart arteries can now be used to clear clots in the brain. currently there are two brands of stints sold here in the

united states. looking ahead, coming up on the closing bell howard ceo of cantor fitzgerald and bgc partners is out with earnings today. they're out with earnings today, and we'll get his reaction to all of that. on closing bell. 3:00 p.m. eastern team. back to you. >> sue, thank you very much. right now it is time for your settling of the oil trade here in new york and once again, oil prices are down. in fact crude oilt off 110 a barrel. that's 2.2% to $48.93. they are back below $50 a barrel. maybe this is why. this is something, folks, we have been talking about in the 2:00 hour for a while now. despite the fact that the drilling rig count seems to go down week after week oil production, the amount of oil actually coming out of the ground is going up. it is up nonetheless, and it is the highest daily output in

america sense the early 1970s. remember, another lesson. there's a big difference between rigs future production and current wells for the production coming out of the ground right now. despite a supply glut we just keep pumping out more oil. one of the reasons, by the way. natural gas also a big story. another huge mover. some reports saying this february may be the coldest of all time in the midwest and the northeast. let's go now to the midwest. jimmy, tjm institutional services, what do you make of the nat gas trade today, jim? >> it's funny that this has been a kind of uneventful winter in most of the country.

>> they've been trading over together which is partially a supply story and partially a strong dollar story. today we'll see if the cold weather can push it higher. >> all right. we have to leave it there. jim, appreciate it. >> all right. thanks. >> all right. time for street talk. the analyst recommendations on stocks you need to know about. we kick it off with brian. >> yeah genoworth financial. out defending this really beaten up name. down 50% over a year. palmer says, though it's a buy. a $15 target. that's about a double -- not quite, but close on the stock. he says there's no capital raised that's going to be needed. >> you can see really that's been weighing on the stock ever since, you know about a year ago. next we're taking a look at pier one imports. this is a new low in this session. credit suissi sticking with the outperform rating even though it's slashed its guidance. it's saying it has a cost issue because it is trying to get into

the omni channel sales. what does that mean? on-line as well as brick and mortar. major setback, but still, yes, sticking with its name. >> they are, but web bush security has a neutral rating on the name. they called the release one step forward, two steps back. their target is $13.50. down 50%, but green sees improved margins and has a $50 target. >> you spent all day thinking yelp needs help. just remember last friday they were down 22% on earning. it was a grub hub acquisition that really helped it thisway week. >> next up we're talking chico's. this is a new high. following a wall street article suggesting that it may be involved in advanced cost. it doesn't know about the sycamore reports, but it does know that it is an attractive target for private equity partners. >> the stock has done pretty well. it's up 12% this year.

watch the port strikes. stevel nicolas out this morning saying that chico's was one of the apparel retailers that may be more vulnerable to port strike inventory disruptions than its piers. something to watch. our final stop is new skin nus. citi upgrade it to a buy. they like the increased visibility. the target goes to $65. about 15% up side. it's already been one of these attack names, but it's up nicely this year. >> it has been. you know analysts are looking at the second half because maybe mark this on your calendar. it's got a couple of new products that will show the company's inwroe vegas. it has an age lock product, brian, and a leaf lock product. >> i'm getting older. luckily inlt getting younger, because that would be weird and bing men button-like. thank you. >> time now for the earnings squad. i'm joined by fast money trader tim seymour, and let's get right to it here. 70% of s&p 500 in terms of reporting so far.

72% beat estimates. 11% net estimates. 17% reported below estimates. a number you should now hear. negative guidance for q1 pacing positive comments 3-1. this is one that has been doing well over the past few months sxshgt biggest concern is going to be china. we've seen slower hardware sales as the chinese government sort of frowns upon domestic companies buying foreign companies.

>> if you look at especially the space, things are set fourp a quarter here. >> this is one that you have been in for some time. >> it's a name we own right now. to me this is -- as you are looking at the international space and people see chinese stocks and interim stocks it's unbelievably volatile, these guys are growing 48 times on the top line. this is what the street is expecting. this is a stock that trades 27 28 times, 2015. it's a balanced i think, risk reward. it's also very balanced investment rebarred for the company. it's been defense i investing in mobile monotiza ti ion. i like the stock. >> we to listen also to commentary about the impact of chinese new year being on the calendar date. we're going to hear that from a lot of the chinese companies. even american companies depending on sales in china and whether or not that is going to be an impact particularly on the advertising revenues. we'll leave it there. thanks as always. see you tonight at 5:00. brian, over to you. >> thank you, melissa, and tim. >> we keep hearing that lower gasoline prices are great for the economy, but are there any

specific stocks you want to buy because of the drop in gas? well, there might be. we've got some 2345i78z for you coming up. as we head to break, a friendly reminder many of the ceos that we have spoken to in this hour lately are saying eh they're nice but they're not really seeing the gas-related bump. >> i can't give you a direct correlation, unfortunately. i do think that a little extra change or some dollars in the wallet certainly makes for a good reason to go out for wings and a beer. >> i think it's a net small tail wind for us. it's certainly better. consumers have a little bit more in their pocket.

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>> on the macrou.s. economy. there is no debate that low gas prices are indeed great for most consumers, and perhaps no group will benefit as much as the restaurants, but are there any specific stocks to buy just because of this? joining us bob darrington, west restaurant analyst. you pointed out that restaurant sales were the most in six years in january. can you tie that directly back to lower gas prices or is it just a continuation of a constantly growing u.s. economy?

>> i think it's a combination of those things, brian. you know it's certainly low gas prices help. now, is there a strong positive correlation? i think there's a correlation, but strong is relative. so lower end consumers, especially those who drive further to their jobs like in california and texas, like jack in the box and sonic, probably get a disproportionate better benefit versus a casual dining chain where consumers, you know, the check average is much higher zoosh you like sonic. you like some others. why jack in the box? why sonic? what makes them more particularly exposed to this than their competitors? >> you know, listen if you look at the fast food set, typically those brands skew to a lower household income consumer on average, but all fast food chains as you well know aren't alike. there's some the bigger ones in the industry, one that i can think of it begins with an m, is -- they haven't quite figured out what to do with the menu to

be relevant to a broad consumer base. but a check average that a typical sonic and jack in the box have that markets very well to their core customer and, again, who drive a longer distance in texas and california, but, you know versus most states in the economy, probably are going to see more benefit to their pocketbook and will use that at the lower end restaurants more often. >> bobby, take a look at a stock like a jack in the box, and that has been on fire for years now. what is it doing right that mcdonald's totally missed the boat on? why is the fast food you know outlet that starts with an m, why is it under such dur eswhen it has the scale to change the landscape? >> yeah. that's fair. and what i would say, melissa, is that if you look at the way they market their business the way they've connected with their core customer for example, jack in the box just introduced a burger which in my opinion skews more towards a quality of product that is popular with a little bit higher income consumer. it's more relevant to their user

base. it helps the check average. and in my view it's the best burger they've introduced in literally 30 years. it's understanding your consumer and figuring out how to market to them and what products they're interested in. >> lower gas prices are a small incremental positive for the restaurant stocks. what really drives the consumer to go there? why -- what is behind that poois spike in january that we saw then? is it that the stock market is close to record highs? what is it that impacts the consumer psyche? >> well i think there's something to be said. one of the oracles of the industry, malcolm knapp has talked about the allocation nation principal. to be fair it implies that when consumers have pressure on their spending, ie christmas sales, preparing for christmas, et cetera that will reduce the number of dollars available to go out and dine. here in january i think we've seen not only the strong economy, very strong industry

gift card sales, very favorable weather year-over-year, low gas prices. you know, it's been a crescendo of things that have come together that, you know, some of the chains have really benefitted from? >> yeah. i guess we should also add that i'm looking at a chart here and i know melissa always tells me bob, she's, like you know brian, live cattle futures are the first thing i look at when i wake up every morning. melissa, this is for you. live cattle futures are down 10%. i don't want to be served live cattle. i would rather have it in burger form, but is this actually helping the business, live cattle? it's cheaper? >> obviously it's one of the different commodities that the industry is dependent on. to the extent that any commodities we see of benefit to the trends and i think we're clearly seeing a benefit to dairy prices and it's trickling into poultry prices, and we're seeing it in pork prices and ultimately we may actually see it in beef. the beef recovery will take longer. it takes longer to grow a cow to a steak than it does a bird you know, to a chicken wing. >> time to eat.

they're both delicious in their own way. >> a bird to a chicken wing. >> thank you very much. live cattle is up 10% a year but down 9% the last three months. melissa, that's for you. president obama says shame on staples for its part on the part-time workers staples striking. that's coming up.

president obama responding to reports that office retailer staples has threatened part-time employees with termination if they try to go over 25 hours a week. in an interview with buzz feed, the president slams stap staples saying "shame on them. staples, though fired back saying "it is unfortunate the president is attacking a company that provides more than 85,000 jobs and is a major taxpayer. they also highlight that this policy is over a decade old.

it has nothing to do with obama care. let's bring in jared bernstein, former economic policy advisor to vice president biden and c nbsz contributor, jimmy american enterprise. should a president, want president obama, not bush, any president, any party ever trektly call out a specific company? >> i don't have a problem in some grand theory about the president directing something at an american company, but the specific situation here is really weird. one, the president may not have his facts right. two, a lot of folks on the left knew that something like this would happen. inf indeed it happened. if you had this employer mandate that businesses would respond because of that will incentive. what a lot of people don't realize is that most health care economists, whether they're on the left or on the right, think the idea of people getting their health care benefits through their employer is a really bad

idea and it really raises health care costs, produces wages, creates lots of snent es that actually is indeed what his own health care economists think for the president to then attack a company for what is probably the better policy overall is weird. >> you know jared, it's an industry that's struggling right? they keep merging and there's been layoffs in the past. there's a risk i suppose when you have somebody of the president's stature saying this you have people saying i'm 23409not going to shop there because the president is angry with them. >> that's a real concern and i think it is an unfortunate incident, but the president had, as jimmy kind of alluded to incorrect information, and he probably would have been smarter to say wait a second buzz feed let me check out this accusation that staples is not only cutting back workers' hour because of the affordable care act but threatening to fire

workers. that would be shameful. he was given wrong information and he reacted accordingly. let me address the more substan stiff point. there is an incentive to keep workers' hours below 30 hours per week in order to avoid having to kor them. if you can put a graph i shared with your crack production staff just about an hour ago, you will see in fact this has not come to pass. and i think jimmy and his colleagues need to recognize this reality. involuntary part-time work which is exactly the type we're talking about here people who want to work more hours but they can't get them is down 20%. voluntary part-time work is up about 5% over this period when everybody has been worrying about these impacts of the affordable care act for good reasons which i can get into. this intencentive has not come to pass. >> one, i never said it has been a widespread problem. i don't think it's led to the creation of all kinds of part-time jobs. two, i wasn't -- i didn't know i could bring my own charts. i'll remember that next time.

and, three -- >> this is byoc jimmy. >> bring your own chart. did i really get this wrong or something, that most health care economists think that companies actually should not be in the business of providing health care benefits? that the only reason they're doing that is because of a weird quirk of history during world war ii and actually if the president really had his druthers he'd probably have those workers in obamacare but he's trying to hide the costs by making the employers pick up the tab. >> well i think -- look i was there when the administration was crafting obamacare, and while you definitely have i think a very good point about a better way to provide health care you're right, it's a quirky thing we do. in order to get this legislation passed we had to work with the system we had, not an ideal system we would like to have created. >> listen we can't just say that the number of part-time workers is because of health care or anything else.

you talk to ceos as much as we do, they'll say for me to hire a $50,000 a year worker i basically have to put $500,000 on my balance sheet because it's impossible to fire them you have all these costs, there's a myriad of other reasons economically or otherwise they don't want to do it. you can't just say it's because of one thing. >> i think that's exactly right. sometimes when we argue obamacare, i don't accuse jimmy of this because i think he's pretty nuanced on this. every praush in the economy is obama care and it's caused conservatives a problem now because they said obamacare is going to be a job killer. we're creating a decent job clip these days. >> the concern you have jared, about the folks on the right and the problems is very well taken. i really appreciate that. >> jimmy, jared we have to leave it there. jared one chart, jimmy, zero. don't come empty handed. >> oh, you will get charts. >> we have an article up right

now, "power lunch".cnbc.com after the show is over head over there, weigh in wait until you're at a computer don't do this while driving. >> definitely not while driving. next up a huge fight in walmart. a tax preparer confronted by an angry customer. what caused it? the agi line. back in two minutes. no. aflac! what are you guys looking for? claims! legend has it these hills are full of 'em. it can take months for an insurance claim to surface. claimin' takes patience. aflac paid my claim in one day. they got some new-fangled kinda one day payin' machine? hehehehe yea, i got aflac at work. aflac... in just one day, we approve and pay. one day pay, only from aflac. aflac... why do we do it? why do we spend every waking moment, thinking about people? why are we so committed to keeping you connected? why combine performance with a conscience? why

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showing and it doesn't make it any better. a tax preparer is working at walmart and the angry customer is working on the right. the head customer head butts the other women in the face. the angry customer says the tax preparer had been rude to her husband the day before. these are allegedly grown-ups. the one on the right pretty much looks like they started everything. >> it's just ridiculous. time for point and counter point. let us know who you think is right. fha wants to cut mortgage fees to make housing more affordable but the bottom line question is can they afford to do that? you know by law the fha has to keep 2% of the amount this they loan as a buffer. you know what they have according to an independent auditor, 0.4%. they cannot afford to do this. the intent is good brian, but they just can't do it. >> i don't know what we're going to do because i completely agree. i think it's a good move but you got to wait until you get to the 2% cap, otherwise why set caps and regulations for yourself. >> exactly. why do the banks have to tighten

up lending standards and the fha can do whatever it wants? >> heavily embedded from previous deal rite aid is paying $2 billion for envision rx. the market likes the deal. the stock is up 6% but melissa lee, back in 1999 rite aid was the first to buy a so-called pbm and then sold it in 2000. now they're going back to what they had done 16 years ago? good move? >> brian sullivan it's a different world now. everybody has got a pb m. look at walgreens, cvs. rite aid needs to do this in order to compete with the big guys. >> they have nearly $6 billion in net debt. >> they can't grow unless they buy. employers are asking managers to ease up on harsh feedback and accentuate the positive which seems like a little bit of a coddling atmosphere. come on, honesty is the best

policy. >> do you have any friends who are teachers melissa? >> no. why? >> i do. you talk to anybody who is a teacher, some of the stories my friends who are teachers tell about what happens when they dare give somebody's child a bad grade, they hear from the parents, the parents go to the administrator. literally like why did you give my kid a c minus. because he missed 45% of the questions. >> brian we are in the everybody gets a medal kind of environment. in the workplace i want to hear what i'm doing in addition to what i'm doing right. so bosses just need to treat employees like they would want to be treated. >> if you're going to get a metal with a "t," which would it be? >> i would choose mill lib da mum. >> i would choose platinum. >> i have to go to the airport. >> i will be on "fast money" with michael burns in an exclusive interview. going to talk about the stars

lie lionsgate stock swap. we'll talk about the new deal with john malone. all right. thanks a lot for watching. you can get more "power lunch" to go. brian sullivan is on his way. "the closing bell" is up next. and welcome to "the closing bell." i'm simon hobbs in the new york stock exchange in for bill griffeth. >> and i'm sara eisen in again for kelly he was. let's on monday the market went down on greek concerns. yesterday it went up on greek optimism and today new concerns about greece not getting a deal done during the emergency meeting is putting us in the red. the dow down about 40 points as we speak. it was worse earlier. >> absolutely, far worse. some major earnings are due out importantly after the bell in about an hour's time. cisco topping the list