hi, everybody. welcome to the "the wall street journal report with maria bartiromo." i'm maria bartiromo. the markets were off to a great start in the new year, but how strong is the market's economy? are europe's worries behind us? i'll get two takes on the story. if your favorite website was blacked out this week, could it happen again? we are talking about the fate of freedom on the web with the beman behind wikipedia. and is the sky rising cost of an education worth it? the "the wall street journal report with maria bartiromo" begins right now. >> this is america's number one

financial news program, "the wall street journal report with maria bartiromo." now maria bartiromo. >> here's what is making news as we head in to a new week on wall street. we are in the thick of earnings season and an economic bellwether reported mixed results them largest industrial company beat expectations but hef knews were less than expected. $38 billion. the company showed strength in the industrial businesses. general electric owns 49% of the parent company that produces this program. a big week for bank earnings, wells fargo beat estimates as did goldman sachs and. microsoft and ebay beat expectations though ebay's outhook was disappointing. the markets got off to their best start in nine years. the s&p closed above the 1300 mark midweek for the first time since july. mostly on optimism about

earnings and little news from europe. if you are driving a clunker, you are not alone. americans are driving cars longer than ever according to a survey. the average age 11 years. good news for automakers who may see pent up demand when the cars finally wear out. how is the economy doing and where is it headed from here. we have two guests that see things differently. joining me is laura tyson and former economic adviser for the clinton administration and mort zuckerman chair and ceo of boston properties and u.s. news and world report editor in chief. good to have you here today. we are seeing signs of life in the economy. jobless claims at the lowest number since 2008, the unemployment rate moving lower recently. there seems to be less worry about europe, as well. earnings season not so bad. where do you think we go from here? >> i think there have been some signs, tentative signs and i

feel they are overexaggerated and overstated in term of economic kons senses. the rnc reason the jobless claims have dropped is fewer people are fired but few are being hired. that's where the choke point is on unemployment and that kind of weakness, i hope it turns better, but it is hard to predict. >> what do you think, laura? how do you see it? >> i think that the situation is very fragile. i think there is a degree of maybe exaggeration of the stren the -- strength of the economy. the economy's potential growth rate is cyclical up or downturn is in the 2 1/2 range. that fraths for 2012, that's enough to absorb the growth in the labor force. it's not enough to really do any significant reduction of the high unemployment rate we already have. that growth rate even if we get

it 2 1/2, 3% some people have it around this, we have a huge gap between our actual output and our potential output level. it's estimated to be in the 5 to 7% range. that really means we have lost and have no way of getting back right now the goods and services we could have produced if we hadn't been in this terrible recession and anemic recovery. the other thing i'd say 2012, the fragile nature of the recovery, the slow nature of the recovery there are major risks out there. we all know about the risk of europe. right now it's looking a little better, but the underlying problem has not been solved. mort mentioned the savings rate. i was quite concerned that one of the reasons there was such strength in the fourth quarter of last year is people drove their savingsing rates down. americans are saving much too little any way. this is not sustainable. >> reporter: the u.s. economy really not out of the woods by

any means. it's interesting. you both are sort of showing skepticism here. i'm hearing mixed reviews on housing. i want to get your take here. last week jamie dimen came on and said he is seeing a bottom in housing. all week i have been speaking to ceos of different banks and one told me he doesn't expect prices in housing to settle down until 2015. where are you on housing? >> i will take a crack at that. if you look at the case schiller index and speak to people in the field they still see prices declining. we don't know how many homes today, i have seen estimates as little as 8 million and as many as 11 million where the mortgage exceeds the price of the home. people aren't willing to buy homes even though the affordability is the best in

years. we are in a quagmire when it comes to the industry. >> we have a large inventory of unsold houses out there. we still have a foreclosure problem which continues. we have a large number of mortgages in the first half of 2012, which actually get reset because they were adjustable. this will actually make it more difficult for many people in terms of meeting their house payments. so i do think that what i think is for sure is that normally we come out of a recession and housing is a major driver of getting the high growth rate. this is not going to happen this year or next year. we may be at the bottom. that's a little hard to tell. we're coming off at a very slow rate. that's going to continue. >> the president this week, big news, rejecting the plans for the keystone excel energy pipeline, which would have taken oil from canada, through the united states, but he rejected

it on environmental grounds. he says it may still come back to life, and he blames, naturally the republicans, saying it was a question of the deadlines set by the republicans. do you think it will come back? is this politics playing out again? >> i think here's the really important part. the politics came in terms of trying to press the deadline on a project that needs verier very serious analysis. the canadianss are looking at their own east-west pipeline and they are looking at it slowly and seriously and saying this is a major issue. we have to look at the environment environmental issues. jobs, environment, safety, spills, all of that stuff needs to be looked at carefully and politics puts a pressure on timing making it impossible to do the analysis them president proposed the americans jobs act in september. the economists out there, macro advisers, a number of major macro firms, estimated that

package together would have created 1.9 million american jobs, much more than the keystone pipeline. that project was -- that american jobs act has largely been killed by the politics of the congress. >> mort -- >> i have to say something. >> yeah, go ahead. >> first of all, the canadian government went off the charts when the pipeline was delayed and they have indicated they are going to sell that energy to china. >> if we want to have these kinds of reliable supply sources. secondly the american jobs act. if the the president wanted to get a jobs act through he should have done what most people would do the under those circumstances, had a private meeting with the leaders of both houses, democrats and republicans and said, okay, look we will all take the credit and the blame. instead he goes to congress in a nationally televised address and attacks the republicans a day later and he campaigns against the republican leader eric cantor and his district and

against john boehner. at that point the republicans knew what it was about ak political presentation to try to the gain an edge on the republicans and the republicans said you want top play that way we're not going to do anything. to you have the worst kind of politics on both sides not just one side playing politics. i could not have thought of a worst way of trying to get a jobs act through. i support laura saying the extension and higher taxes on the wealthy but this is not the way to get stuff done. >> good to talk to you. the conversation continues and we will see you soon. >> thank you so much. up next on the "the wall street journal report with maria bartiromo," internet blackout. can a dark day for the dot-com community keep the on-line community free and open? i will talk to a founder of wikipedia. and higher price tag for higher learning a look at the student loan debt in the united states. is affordable education a thing of the past? we will look at the stock

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in a coordinated effort to protest government regulation of the internet this week, thousands of websites, including the free on-line encyclopedia, wikipedia, went dark for 24 hours them legislation to stop on-line piracy act and protect intellectual property act this would allow the u.s. government to crackdown websites that link to counterfeit goods or certain material. jimmy wales is the cofounder of wikipedia. thank you for joining us. >> good to be here. >> that was a big move. going dark for 24 hours them world had to survive without 20 million articles on wikipedia for 24 hours. have you gotten the response you

expected to wednesday's blackout? >> yeah. we have had an enormous response. we have had 90 million people view the protest page. we have had 4 million people look up the phone number of their representative. so we hope that translated in to an enormous number of calls in to washington to let them know how the public feels. >> tell me about this supposed legislation. it doesn't seem like a bad thing to limit piracy of copyrighted materials or products. so where's the evil here? why do you think these two pieces of po tenial legislation go too far? >> yeah, i think it is important to realize that it's one thing to say we want to fight piracy and i don't have any objection to that. what i have an objection to is doing it in such a way that involves building the entire infrastructure for censorship of the internet and there were a lot of provisions in these bills that allowed websites to be

taken down without even a court hearing. those things are dangerous and i think we need to go back to the drawing board and look at the more responsible ways that we may deal with the problems. >> film and tv studios spend millions of dollars on projects, writers and journalists, spending time and resources, why shouldn't content providers be compensated for their work. >> i think they should be compensated for their work. my view is that, you know, the system that we have in the u.s. with the digital millennium copyright act which has a no notice take down provision and orderly and worked well for ten years f somebody posts something that is copyrighted material and the copyright holder objects to it that the host isn't responsible other than hear adhering to the take down notices. if you have a regime under which people are responsible ahead of the fact before they are notified of something a user has done wrong it makes it difficult

for people to allow users to do whatever they are trying to do. >> the debate is pitting hollywood and silicone valley against each other. both sides say it is about jobs. is your take on that? >> i do think it is about some of these economic factors. hollywood does per sieve a big threat. i think the threat is wildly overstated and i think what they need to do is think of their business models and finally drag themselves kicking and screaming in to the modern world and take advantage of the opportunities of digital distribution, digital platforms rather than trying to shut it down. >> wick media run by donation and the content crowd source. how many jobs are you creating? tell us what this means for you. >> we are a charity. our goal is to give a free encyclopedia on the planet in their own language. what's that do for employment? i'm not sure but i think having an educated work force and

knowledge at people's fingertips is important for economic prosperity for the entire world. we're not just about creating jobs but changing the world for the better. >> how do you get consumers to write to congress about dangerous legislation and get consumers to make purchasing decisions geared toward, you know, openness on the internet? >> well with, i think they do. what we see from really active internet users on places like twitter and wikipedia is people are passionate about the free and open internet. they are living the benefits and realize and understand what it is about. generally speaking, they are aware of the issues around piracy and understand it is a complicated issue. so getting people to react wasn't that difficult. we had to ask them. >> that's great. good to have you on the program. thank you so much. >> very good. thank you for having me on. >> jimmy wales joining us, cofounder wikipedia. many companies support the

legislation including nbc universal parent of the company that produces this program. my tanks to wikipedia's jimmy wales. up next on the "the wall street journal report with maria bartiromo," americans owe more in student loan debt than [ crickets chirping ]

[ traffic passing ] ♪ [ music box: lullaby ] [ man on tv, indistinct ] ♪ [ lullaby continues ] [ baby coos ] [ man announcing ] millions are still exposed to the dangers... of secondhand smoke... and some of them can't do anything about it. ♪ [ continues ] [ gasping ] forty years ago, he wasn't looking for financial advice. back then he had something more important to do. 40 years ago he wasn't looking for financial advice. back then he had something hg more important to do.

he wasn't focused on hi future but fortunately somebody else was at usaa we provide retirement planning for military, veterans and families. now more than ever it is important to get financial advice for from people who share your military values. . for a free usaa retirement guide call. welcome back. with division rising steadily americans are borrowing more for higher education than before. outstanding student loan debt in the united states is closing in on a trillion dollars.

individual graduates have an average debt of $25,000 alongside their degrees. how do you manage the student loan debt load or avoid it entirely? janet bodnar is the editor of kiplinger's personal finance magazine . it is good to have you on the program. >> thank you very much. >> it used to be we worried about credit card debt and now student loan debt is exceeding credit card debt. let's talk about that. americans dethe leveraging on a lot of things these days given thank you the fragile economic story and borrowing for education has doubled in the last decade. how big of an issue is this. >> numerically is a huge economic issue. the demand for college education increases and demand for a product increases price increases and other things that we won't get in to but the point is young people know that it is important. therefore, they are willing to pay almost anything it would seem to go out and get an

education and they tend to borrow more money without thinking how they will pay it back. that's the real critical issue. >> let's talk strategy from lightening the debt, if you are having trouble for federal, private loans, like those provided by sally mae. talk to us about that. >> federal offer the most flexibility. because the standard repayment term is ten years, but you can change that the. you could for example extend the repayment period which lowers the payments. you will pay more interest over the term of the loan but the payments are more manageable and fit in your budget. one of the neatest thing is the income contingent plans where your payment is contingent on the income you make. so if you make a lower income in a lower income job you can make your payment more manageable. >> private loans like those provided by sally mae. what's your take this. >> they don't have the same f x

flexibili flexibility, but get in touch with the lender, particularly sally mae. they have an advocate for student loans. they say if you call them and you are having trouble paying loans they will try to work something out with you. if you are having problems and you don't know what to do the about it don't sit there and stew. >> one strategy is to avoid racking up debt entirely. how do you find the bestle value for your education dollars? >> that's number one. pick a school your family can afford. we at kiplinger's do best value in private colleges and universities annual rating and pick a school that fits in to your budget. that's number one. a lot of families make the mistake. kids-their heart set on a particular school and parents say we will make it happen because that's your dream. well the dream involves a lot of debt they can't repay. number one is pick a school you can afford. >> with all of the talk about education and competitioning in

the world, new conversation is talk taking place across the country. is it worth it to have a college degree? private colleges on average cost $37,000 a year. you are talking about some colleges approaching $60,000 a year just for a college education, is a private college education worth the price? >> a higher education is definitely worth the price. you definitely need post secondary education to function in today's world. the type differs depending on what your talents are and what you want to do and the major you want to have. a private college education that costs $50,000, no, not everyone needs that type of education. you can get, because as you can see with our best values list a good education from public schools for half of the price, sometimes less than half of the price. some private schools are very good about the amount of financial aid and you can pay less going to a private school that gives you financial aid than a public school. the point is, what do you want to do with the degree afterwards.

i tell people if you have to borrow $100,000 to get a college degree, you can't afford it. you really have to come up with a plan b. you can not get yourself in to that much debt. >> interesting and important conversation. good to have you on the program. >> thank you so much. janet bodnar joining us on college educations and the cost. we will look at the news this upcoming week that will have an impact on your money. and the world's largest cut emerald is being called a gift from god, but at what price? stay with us. what makes scottrade your smartphone's

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for more on our show and our guests check out our website. hope you will follow me on twitter and google+ @maria bartiromo. a flurry of fourth quarter earnings reports. it will be a busy one. dupont, johnson and johnson, mcdonald's, travelers, verizon, boeing, starbucks, apple, at&t, chevron, 3m and proctor & gamble. the earning flow will set the tone for the markets and the president will address congress and the markets with the state of the union address on tuesday. the open market committee will wrap up the meeting with a press conference from chairman bernanke. he will be discussing monetary policy. friday the first reading of the fourth quarter gross domestic product the broadest measure of the strength of the u.s. economy. that is tippic lay market mover. and a gem that if you like

it you can't put a ring on it. it is too big. this watermelon size emerald weighing 25 pounds is going up for auction in canada later this month. it is valued at $1.5 million. the stone is called god's gift. it came from a mine in brazil. at 57,000 krarts, the stone is believed to be the largest cut emerald in the world. thank you so much for joining me. next week i will be reporting from the the world economic forum in davos, switzerland. we will have a sense on what is happening on the global stage. have a great week, everybody. see you next weekend.