you again next time. hi, everybody. welcome to the "wall street journal report." i'm maria bartiromo reporting today from london in the midst of new talks of an aid package for troubled greece. i'll have the views from the other side of the pond and talk about investing in europe and how the economy is doing here. should it be part of your portfolio and just how do you do it? my conversation with one of the most powerful women in business pepsic yoe ceo indra nooyi. where she sees profits up. how burberry keeps up with the times. the "wall street journal report" begins right now.

first we have the day's headlines. >> thanks very much. here's a look at what's making news as we head into a new week on wall street. in a new move to boost the sagging housing market, the federal government has a bold new plan to help homeowners. it will include initiatives to refinance loans and get homeowners who owe more than their house is worth into new government-backed mortgages with lower payments. it would also temporarily reduce the payments for borrowers who are unemployed and looking for a job. and it will also encourage lenders to write down loan balances to help lower monthly payments. it comes on the heels of two disappointing pieces of housing news. sales of existing homes fell for a third straight month. and new home sales, they were down as well, fourth straight month there. they tumbled 2.2%. record low. in spite of that, the dow hit an 18-month high with a triple

digit gain on tuesday, took a breather on wednesday and was flat on thursday. the markets were flat on friday. google is shutting down its search engine in china, the world's biggest market. the company said it will not tolerate censorship by chinese authorities and is sending people to its unfiltered hong kong website. it's sometimes the gift that stops giving. but now federal regulators are issuing new rules about gift cards. they will soon have to be valid for at least five years and there can be no penalty fee. now back to maria with the rest of the program. >> thanks so much. here in london concerns are similar to those in the u.s. fragile recovery in place. worries about jobs, the budget. and of course the slow environment. but how are the markets doing here and should some part of your portfolio be invested in europe? we have a look at that with ubs chief european equity strategist and chief economist. good to have you here.

thanks for joining us. jared, how would you characterize the global recovery? >> a global recovery is very weak. it's much stronger in the east. in the west, in the states. and in europe it's very, very weak indeed. basically the u.s. economy is in difficulty but the europe economy is worst. in europe it's time to think as bad as things are in the states it's worse over there. >> sounds like you are assessing joblessness continuing to persist in 2010. would you say an actual recovery is a 2011 affair? >> in europe we have obviously many countries. germany is in pretty good shape because their export is doing well. sending exports to china. but other european countries is the likes of greece, portugal, ireland, down key evaluations but all together tied to the euro so greece's position those problems have come to head and in the last week we've seen the key economies in europe, germany

and france trying to club together. maybe that the imf will help. but the reality is the smaller economies in europe have no easy way out. >> you're seeing a bit of power shift to asia as china grows and we're seeing real vibrancy there at a time that europe is slow and the u.s. is slow. but sounds like a real devastating situation here in europe. karen, do you agree with that? as an investor, how do you want to approach that kind of a story? >> perfect question. absolutely perfect. economists and he can quit people and european equity strategist look at european equity markets very different than the european economy. equity markets have a real opportunity of opening up. one of the reasons is american investors won't touch europe right now. january, february, won't touch it. concerned about the currency. is it going to roll over? weak economic growth. but p companies in europe are a different nature. a lot of the market is selling

outside of europe and profits can do quite well even when economic growth is weak. and because the americans won't touch europe and a lot of international investors you're starting to see a gap of valuations of european companies and great opportunities. >> opportunities in terms of putting money to work at the bottom, putting money to work at depressed levels. >> yeah, sure. opportunities means -- people have ignored the market. you look at s.a.p. versus oracle we saw on television. both had okay results but s.a.p. is trading at a big discount to oracle. so you get these big international players with good brand names that have done -- last year was the international company play in the u.s., wasn't it? currency was weak. u.s. internationals did really well. i think if the currency keeps weakening in euro that game could change. once you get a bit of comfort with the economic -- the sovereign crisis and debt crisis

in greece you start to feel more comfortable with that i any you'll see money dripping back into the large cap internationals in europe. >> do you think there is some opportunity that you see? gerard, i know we're looking at a deteriorating situation here as it relates to what's happening with the debt issue in greece and the impact of the euro zone in a slow economy. how much does china play in here. >> we're seeing a shift in the power. the winners will the countries with the financial resources like china, saudi, the countries that have the natural resources and the countries that have the ability to adapt and change. so the companies that are serving into those markets, the companies in the financial sector and retail sector that are international will do well. but the problem is that the u.s. and the european economies face a jobless recovery. so you don't want to look for companies in europe or in the states that serving domestically but serving internationally. that is a problem because it means whilst interest rates in america and europe stay low, it means politicians will start to

become more protectionist in their outlook. that's a challenge. so we need to look for politicians to think global about the challenge. the best perspective is pick the global brands without getting caught up by the ones that are bogged down and pulled down by the economic weakness in the states or -- >> great point because certainly the economic upset has created just that, protectionism around the world. good to have you on the program. so appreciate your time. gerard lyons and karen. up next, pepsico ceo indra nooyi on the show. a demand for snack foods. a global business there. how it's faring globally. mad about plaid. i'll talk to a woman running one of the most iconic brands.

soft drink andsnack giant pepsico announced a commitment to use more natural sweeteners and increasing a line of healthier snacks. among the invasions attempting to attract customers in a less profitable environment. earlier i spoke with the brand's ceo indra nooyi at yankee stadium, the site of their annual analyst meeting and asked one of the most influential female executives today how she sees the economic recovery right now. >> i tell you, i -- in the western world especially in the united states, what i have not yet seen is the construction worker coming back to work. and i think you need that worker coming back because a true test of the economic vitality of the economy is when that worker is

employed. and we're not seeing that as yet. >> what would it take for you to create new jobs right now? i know earlier you said that you're expecting low double-digit eps growth in 2011 and 2012. what is it going to take you to move pepsico and other companies just like you to move from the cost cutting phase of things to the growth part of things where you actually are going to create new jobs? is it a policy out of administration, something else? >> i think it comes down to is the economy doesn't well. and there was something said saying we can see gdp growth and statistical recovery and a human recession. that's not good enough. because that's not going to be long-lived. we need to see sustainable job creation. we need statistical recovery and human growth, employment growth. if that happens, confidence is back in all of private enterprise and we can hire and grow and plan for the future.

we're still refreshing our talent and still hiring in many places including in the united states. but i think we really want companies to come back to a hiring cycle we need confidence there's going to be job growth in the country. >> a number of executives have come on the program saying there are too many uncertainties in 2011. not just higher taxes which we know are coming but also health care. as a leader in the global community, what do you think about this? how is this going to change your business? >> well, give us some time to go up and study it and understand the implications for the company. but the first thing we have to do is come together as americans and say here's a president that put everything out there to sell a bill that he felt was right for the american public and it's right for a lot of people that don't have health care insurance. i think at this moment we have to sit back and say there's a president that delivered on a promise he made during the campaign. as far as the implications for pepsico, we have a lot of people studying the impli kaptions of all of that, the final mockup in the bill. and over the next weeks and

months we'll have a better perspective. >> the last time we spoke you were in china outside of beijing somewhere. you were talking about the new plant that you were putting up there and you were planning on doing 13 plants in china. talk to me about the opportunity because you know the news, google is coming out and going to shut down china because they can't be censored. you haven't obviously had any issues with the chinese government because you're creating a plant there. >> it's actually -- the chinese government has been very good to us. we had permission to build another 14 plants. we have 22 plants on the ground already. we're going to build another 14 plants. we're growing. >> this is an important region if. >> very important region and especially recently the chinese government has been particularly good to us and has been supportive of our strategies both on the beverage and the snack side because we also do good for farmers. we develop agro. in a lot of these areas i think we're partners with the chinese government. the one thing about pepsico is

we're a great global company headquartered in the united states but we're local in every country in which we operate because you can't export soft drinks and chips. you have to be local. i mean there's -- >> and creating jobs -- >> creating jobs everywhere. >> so can you break it down for us as far as the international landscape? are you still seeing much of the vibrancy of the company coming outside of the u.s. in the emerging markets? and how is europe doing? >> east and the middle east the markets are extremely vibrant. i think japan has always been slow market. but all of the other markets east to the middle east extreme vibrancy especially markets like india. we're seeing a level of excitement that's unbelievable. we're also seeing a lot of vibrancy in south america, south of mexico. especially markets like brazil. a lot of optimism. people are feeling great about the market. i think the slowness is really in east and western europe and north america and mexico. so those are the markets we need to have targeted attention to and figure out how to get the

unemployment rates down. it's not just gdp growth. we have got to address jobs. >> and most important message you want to leave with analysts and investors today as you continue this two-day analysts meeting? >> that pepsico is an incredible company with a great heritage and great past and even brighter future ahead of us. >> my thanks to indra nooyi, ceo of pepsico. up nex on the "wall street journal report" the fashionen view from europe. their raincoat was worn by british soldiers 100 years ago. now burberry is a luxury brand with global reach. how is business doing now? become a fan on facebook. you'll find us on facebook at wsjr with maria.

the united kingdom's largest luxury retailer is the burberry group a 154-year-old company that once made rain coats for the british army. this brand now has global scope and high end consumers. joining me burberry group ceo angela ahrendts. good to have you on the program. you're an american woman from the midwest running this luxury brand. how is this area of retail doing right now versus other areas? when you think about a raincoat, more than $1,000 is a lot for some people to pay for a raincoat. >> it is. but i think the difference is when they know that they're going to get a return on that

investment for 20 years on average, i think it's psychologically a very different purchase. it's an investment purchase, not just a fashion purchase. >> here in europe people are talking about the problems in greece, talking about an economy that's slow, yet there seems to be a real shift toward the east. i know you have increasingly a lot of focus on asia. you have 44 stores in china. what's -- where's the growth coming from? asia, mideast, europe? >> it's interesting because we just reported every market almost double digits with america up high single digits. so, again, great brand. pretty solid around. but i would tell you that the emerging markets as you said -- china, asia -- markets where you have currency on your side -- uk, korea are absolutely outpacing. india, latin america. china is a little further up on the trend curve right now. >> burberry's runway show during london's fashion week also created a 3d experience, right?

you tied locations around the world. how is technology, whether 3d or social networking, mobile phone applications, changing the business? >> it's changing it dramatically. and dynamically. i mean, you just -- it can't even be part of your five-year plan it's happening so quickly. but it also allows you to go back to some of the old traditional metrics because the reach is just unbelievable. we hit a million friends on facebook today. the largest in the sector by a long shot. but christopher goes on every year -- >> creative director? >> creative officer christopher bailey. incredibly talent. talks to the consumer about what's coming. a week before the show he's in the design studio talking to customers about what's coming and how exciting it is. it can be so inclusive. you've got the music. the customer can really feel the brand and the culture of the brand.

>> i wonder how that's impacting the consumer shopping experience. when you're looking at a show in 3d, does that impact the clothes, the way they look? in other words, can you see the fabrics more clearly? can you get a better idea of the cut? tell me about the shopping experience and how it's changing for people. >> absolutely. you get much more detail and much more detail. and in our case you get a lot of sh sherlings and buckles and details. we actually did something else that was really fun and kind of another first is actually did runway to reality so those people who were e-mailing in, you could actually click and buy and have that item delivered in four weeks. >> wow, that's terrific. you're really focusing on the young consumer, younger per demographic and i guess choosing from the harry potter movie aption the face of the brand tells you that. tell me about that demographic.

can young shoppers afford luxury? >> a lot of them can but i -- we call that the millennial consumer but age is limitless and timeless. she has to be young but her look is classic. we don't want to do anything to block the core consumer. they're vital and we have a nice going children's business so we played pretty -- we said cost generation if you will. >> burberry's signature plaid, that really is -- it screams burberry. everybody knows that plaid and dates back to the 1920s. yet you have wannabes around. you're suing discounter tj max for selling counterfeit that version of the burberry item and that signature plaid. how big of a problem is that? >> in some respects you're flatter erred about it because the hotter you get, people try to do it. but we keep reinforcing it and trying to add innovation. christopher will cut on the bye

and i think the more innovations we make the more obvious the fakes. >> are you a big shopper of the items in the collection or do you wear the same sort of signature items? how has the brand dictated what you're doing? >> ah, what a great question. it's funny because when i started -- we put in a great team of people, great design team, great merchants. now i will tell you a funny quote. we had raunway show and after the show everyone was talking and one of the guys said it's so fabulous i have to get another closet. the other guy said, no, i have to move because we live in the clothes. i think that's a big part of the success because we're feeling what the customer wants and we are the customer. >> happy to have you on the program. see you soon. angela ahrendts, ceo of burberry. up next on the "wall street journal report" a look at the news this week that will have an impact on your money and the place where british monarchs take throne is getting a new look. more when we come back.

for more on our show and our guests check out the website wsjr.cnbc.com. also find a link to my blog investor agenda.cnbc.com. i hope you'll check it out. now a look at stories coming up in the week ahead that may move the markets and impact your money. on monday the government releases data on total personal income and spending. then on tuesday, the latest

reading of the s&p/case-shiller home price index will be out that measures home prices and the changes in prices in 20 cities across the country. the latest reading of consumer confidence from the conference board as well. thursday, april 1st, total auto and truck sales out. on friday the labor department releases the very important latest employment report. we'll see if the economy is finally beginning to create jobs. but the stock markets are closed that day in observance of good friday. and finally today, the view from london. behind me is westminster. a building with more than 1,000 years of history. the coronation church since 1066, queen elizabeth ii was crowned there in 1953. last year a $34 million publicly funded renovation project was announced to include a museum, a new elevator and deck dantd new crown-shaped roof. it's expected to be finished by 2013 in time to celebrate queen

elizabeth's diamond jublee. thanks for being with me. next week a look at success. a great discussion with success stories. former ceo jack welch and sir martin sorrell on the heels of my book "success" launched next week. keep it right here wall street means main street. have a great week, everybody. i'll see you next weekend.