welcome to the "the wall street journal report." i'm maria bartiromo. the bulls are back on wall street. major milestones are passed. is it time to get back in the stock market? the rising price of oil and gas will it throw the economy off track and can the saudis come to the rescue. i will talk to the ceo of one of america's largest energy companies. and a bird's eye view of political history from the documentary film maker who invented a new way of making movies. the "the wall street journal report" begins right now. >> here's what is making news as

we head to a new week on wall street. most major american banks passed a big test by the federal reserve this week. the stress test simulates difficult economic conditions such as an unemployment rate of 13%. a decline of stocks of 50% and 21% decline in housing prices. 15 of the nation's largest banks passed the test including jpmorgan chase which raised its def dind. bank of america and wells fargo passed the test. citi and sun trust and met life failed. it was a week of momentous milestones. the dow closed above 13,000. the nasdaq finished above 3,000. the all time high is 5,000. later this the week the s&p topped 1400 that was thursday. the first time ever all of the indeck traded above those numbers at once. the federal reserve's open market committee met on tuesday and took no action on interest rates but gave its view of the economy a modest upgrade.

americans are still shopping. retail sales had the best gain in five months. climbing 1.1% for the month of february. the numbers were up 6/10 of a%. auto sales helped to contribute to the strong numbers. retail sales are important because the consumer is 70% of america's economy. how important are the market numbers we are seeing this week? is it time to jump in on equities. joining me is david kelly, chief market strategist with jpmorgan funds and -- from the the motley fool website. >> david kelly, we saw major milestones this week. the dow passing 13,000. the nasdaq at 3,000. the s&p at 1400 and the fed slightly upgrading its view of the economy. do you think we continue to climb here? what's the significance of those round numbers, if you will? >> the significance of them is the impact they have on confidence. that is what is driving a lot of

what is going on in the economy and the markets in the last few months. people are finally shaking off the blues they have had in the so-called recovery to this point. most confident dense measures are moving up. we have hit the milestones and people feel better putting money in to equities and should drive eck dwity prices higher. >> another big story this week the former goldman sachs employee greg smith. he blasted them saying the company was more interested in making money for itself than clients and clients were called muppets by goldman employees. what's your take on this? >> first of all, that's one man's view. i can't really speak to it other than my own test is to look at what he said in his voice and see what the ceo said in his voice and if i had to relate to one or the other i would relate more to the employee who left. i thought he sounded sincere to me. i thought the ceo of goldman was deflecktive and sarcastic.

i think the mrp important point here, maria, it is about culture today. work place culture is a focus of people like me and i'm sure david kelly and his company. we are looking at what it is like to work at a company. tlaen is a key virtuous cycle that has to take part in businesses and that is serving the right product and service and if you are doing that and customers love you then your employees will love to work there. so that is a virtuous cycle. >> we saw middle east major banks pass the new stress test by the the federal reserve this week. four banks did not pass most notably citi. how important was this? are you surprise by the results of the fed stress test, david? >> not particularly. but it is important to recognize how stressful these stress tests are. this is not a bad case scenario. this is a disaster scenario and i think it is -- i think it is reflective of how much progress

we have made that only four banks didn't fully meet all of the criteria. i think it is good the federal reserve does this because it does two things like the original stress test. first of all, in has confidence the institutions themselves and tells you the federal reserve regards these institutions as critical and they will do what they need to do to make sure the financial system is solid here. >> david gardner, you are a lempl long-term investor did any of the news of the week change the way you are investing? >> first of all i thought it was nice that 15 of the 19 banks passed and nice to return some to shareholder and so i thought that was an important story. i keep going back to the goldman sachs story. i don't know who to believe right now, but i think the real thing we should be looking at as long-term toward is the cultures of the companies with are invested in.

too many people are dialing in screeners and looking for certain numbers and looking for mumt approximatelies and that's the way they are investing. in a lot of cases they may be looking at stock which is removed from the business of business. the real key is to look for great companies with great cultures. whether apple, amazon, newer companies like linkedin. i admire these companies and i think people love to work for them and they will return god money as shareholders over the years. >> yep david kelly, whether it is culture or uncertainty people have been afraid to go in to stocks but recently we are seeing money come out of bonds, bond funds. do you think the retail investor is coming back? are they losing their fear of stocks? that's why may have been putting money to fixed income, right? >> i think they are. the key thing is the unemployment numbers. we got that friday a week with ago. as unemployment begins to come down, as we create more jobs,

that really acts as extraordinaries steroids for our consumer and investor confidence. i they will push people away from using bonds and back to equities and i think a lot of toward will be late to the party but good too see them move to be more balanced in this environment. >> david gardner, what do you think? >> the more that we as are investors stay focused stay focused on being invested overi'm and not trying to time our way in and out of asset classes the better off people like me will be. >> what do you want to be exposed for equities. >> first of all i couldn't agree more with david. it is good to have an asset allocation strategy n. a rising market you have to be in things that go up the most with the overall markets. i think technology and financials at this stage as the economy recovers. but the most important thing is check how much exposure you have to fixed. don't be in fixed income in the environment. >> thank you for your insights.

appreciate it. up next on the "the wall street journal report," the rising price of crude oil and gasoline. how high can they go? what's next the at pump? i will talk to the ceo of the nation's second largest oil company. and the cameras that caught it all. a look at the story that changed presidential campaigns forever. >> he is so yesterday. [ horn honks ] hey, it's sandra -- from accounting. peter. i can see that you're busy... but you were gonna help us crunch the numbers for accounts receivable today. i mean i know that this is important. well, both are important. let's be clear. they are but this is important too. [ man ] the receivables. [ male announcer ] michelin knows it's better for xerox to help manage their finance processing. so they can focus on keeping the world moving. with xerox, you're ready for real business.

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is this an end in sight to pain at the pump? the price of oil and gas has be become a political and economic issue these days. john watson the chairman and ceo of chevron told me prices are likely to remain high. we talked middle east tension the cause of the prices and whether prices will mean less demand. >> we are seeing that right now. if you look at the peak in u.s. oil consumption it was 21 million barrels a day, as little

as three years ago. it is now down to 19 million barrels a day. so we are seeing that. high prices are partially contributing to that and another component is a weak economy. those factors are contributing. of course high prices are being driven by a number of factors around the world. turmoil in the middle east, the fundamentals of supply and demand with growing dmmd asia, which is tightening the balance, the sup and demand balance and the financialization and commodities markets. all of those are contributing. >> given the price of oil, where it is right now, above $100 a barrel, if we stay above these levels, do you think that that will impact economic growth in the united states? >> i think there's certainly some impact by the price level we have today. when you see $125 or higher, that will certainly impact the economy. >> can opec do anything to slow down the move in oil? >> i think there's a limited amount that opec can do right now. if you look at spare capacity

around the world there's very little. saudi arabia is increasing production to make up for some of the reductions in supply that we are seeing as a result of the turmoil in north africa and iran and there's precious little spare capacity. that's part of the reason we are seeing prices rise. >> do you think that prices have bottomed. >> prices have come down to, they don't reflect cost today. they are at 2.50, which is equivalent lent to $15 dollars a barrel. so natural gas is much cheaper than oil and it is a function of the expansion of supply. the industry has invested rapidly on private lands to increase natural gas production and that has been great for consumer and industrial demand as we have a surplus. over time, i would expect those prices to rise because has we deplete those wells we will need to drill new once and 250 gas cannot be sustained in the cost structure in the country. >> in terms of north america, tell me about the access in the

gulf of mexico and are there areas -- i mean 85% off limit is sounds like a huge number. >> the gulf of mexico we have had access to the gulf of mexico for sometime. the real issue is in the eastern gulf of mexico. along the atlantic coast, alaska, california. we have vast acreage of land off shore that we can access and develop. not all of it will be perspective but the united states geologic survey says we have the opportunity create another chevron with the resources that are available out there but we have to be given the access and we have to drill exploratory well and develop the resources that we find. >> what do you think your industry has to do to improve the image? i think the average guy out there recognizes the things that you are seeing but the average guy is going and getting gas and annoyed he's paying so much for crude oil and gasoline. does the industry, chevron included, need to do anything

more to offset this constant bashing and improve your image? >> i think the public has high expectations for us, and they should. over the years the industry has made mistakes and those get highlighted. over years, the industry has a good track record of delivering affordable energy. when i talk about energy policy that's what i emphasize. we need affordable energy. yes we national security and but if we don't have affordable energy it will not create the growth that we need in our economy. >> we haven't had an energy policy in a long time. as a student of this business as long as you have been and a leader in this industry, why? why don't we have an energy policy and what should an energy policy look like from your standpoint? >> the story that hasn't been told well is the long lead times in our business. we have had a century putting together the energy system that we have today and the idea that overnight we are going to change

that and new fuels will be introduced doesn't square with the facts. we need to to be science based and sure that we understand that the time it takes to produce affordable energy at scale it is a very long horizon and it will take time. we need consistent, patient policy over time. we are not going to be able to change the energy mix in the foreseeable future. >> what is the most viable alternative energy you see today? >> right now the renewable resources that are available in sdal are largely geo thermal resources. we have the number one producer of alternative energy. in terms of new fuels and fuels in the future we'd like to see, biofuels have some promise but the reality is next generation biofuels are a long time and coming and we have to be careful that we don't try to force these deals in though market or they will raise prices to consumers. >> my thanks to john watson, up next on the "the wall street

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the film maker who pioneered observation a documentaries that captured some of the 20th centuries signature moments. joining me are the film makers, their oscar nominated film "the war room" is being released this week on the blu-ray and dvd. thank you for joining us. >> watching that it is the economy stupid. it's amazing. he just said that. did you know what you had captured would be so powerful years later? >> i don't think in the beginning we knew. we were trying very hard to be with the candidate. we wanted to see a man become president. that was our original idea. we tried to be with bush and obviously the white house wasn't going to let him trail him around and per rerow kept running and we went to the clinton campaign and they said clinton already had a photographer and a "newsweek" writer following him so we couldn't follow him but if we

liked we could film the staff. so in a sense it was a movie -- luckily we bumped in to james carville and we couldn't realize at first he was the guy doing strategy in the campaign. once he allowed us in, we knew we were someplace special. >> what about you? >> the rules so called of the "the war room" which was a basketball court sized place full of beer cans and popcorn and 25 people, actually press was not supposed to be this. that was our refuge. we had visitors on our -- and it was sort of hard to maintain an interest when everybody would then go out to some parade or manifestation somewhere and we'd be left alone in the office there. and that is when we decided to call the film "the war room" because nobody could fault us

because that's where we were. >> right. it's amazing when you look at the numbers, bill clinton's '92 campaign raised 70 million dhz. barack obama in 2008 raised almost $750 million. the money, internet, news cycle. what do you make of how the political system has changed. >> i wouldn't have any idea how to run a campaign now. it is hard to think back in those days. rel really, the major impetus was the three major networks. even cable tv wasn't much of a force then. if they needed to read the "new york times" they had to fax it to little rock. it is hard to conceive of a news cycle compared to now and everybody can be a reporter and every minute can be can be up on the web with that can be positive or negative for a candidate sgit is night and day actually. you worked with such large personalities. you have john, robert kennedy,

elaine stritch, john delorean. how tough is it to get people to trust you and your camera? >> i don't know. it's kind of hard -- it's like asking people to marry you in a way because whatever you do will be around for a while. somebody has to be responsible for it. i think, though -- what we are doing is kind of history for people. i think people that like what they do or believe in what they do, whether they are presidents or rock bands, they like the idea of history somehow taking notice of them. >> meanwhile film technology has gotten more accessible and less expensive. do changes in technology or increased competition alter the way you tell stories. >> you can shoot more footage which means you perhaps won't miss as many events. we shot and edited it in film

when we shot "the war room." if the "the war room" we shot 40 hours of film compared to when i shot start up.com an internet story ten years later i shot probably 300 hours of film. there's a big difference. in the heart of it, it's the same. you are looking for character. you are looking for drama. you are looking for people who are passionate and let you in to their lives. >> reporter: what are you working on now? your films have such represented such powerful moments in our culture, start up.com, profiling the boom and bust of one internet company in 1999. kings of pastry, featuring high-stakes food competition. what are you working on now? >> now we are doing a story on animal rights and we are following a lawyer who spent 30 years preparing a prestigious case to extend certain rights to high intelligent animals. >> the idea is to make an

animal/person. >> there are many of us out there. >> i think so. what's interesting for me about it is, it is futurizing. i think in 50 or 100 years we probably won't eat meat because it is too expensive. our mates on this planet, we have to make a new arrangement with them. >> good to have you on the program. so appreciate it. up next on the "the wall street journal report," a look at the news this upcoming week that will have an impact on your money. and them end of a long road for a total know it all. as we take a break, look at how the stock market ended the week. since ameriprise financial was founded back in 1894, they've been committed to putting clients first. helping generations through tough times. good times. never taking a bailout. there when you need them. helping millions of americans over the centuries.

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for more on our show and our guests, check out the website wsyr.cnbc.com. i hope you follow me at google+ @maria bartiromo. look at the markets. the latest earnings news is out from fedex, nike, oracle, general mill and tiffany this week. nous news about the housing market the number of new residential units that began construction last month will be out on tuesday and the realtors will report the number of existing homes sold last month and new home sales will end the week. the book ends after more than 200 years.

encyclopedia britannica will no longer be available on the printed page. they account for less than 1% of the revenue. britannica announced plans to focus on the digital product which is updated daily for schools and subscribers. the final print edition has 32 volumes and weighs 129 pounds. the price $1400. a sign of the times. that will do it for us today. thank you for joining us. my guest next week byron wean with his prediction for the market and the economy for 2012. each week keep it here where wall street mee