hi everybody, welcome to "the wall street jounal report." i'm maria bartiromo. bang on it. earning season under way, will the companies deliver. and what it means. and president obama's message and tax proposal, does it go far enough? and what does it mean to you. and the fastest moving sport around, we'll talk sports with the ceo of nascar, "the wall street jounal report" right now. this is america's number one financial news program. "the wall street journal report" now maria bartiromo. here is what look at what is making news. banking giant j.p. morgan chase released earnings numbers on friday, closely watched because of the massive trading losses

the bank suffered. according to chairman and ceo, jamie dimon, the losses are pegged at 4.4 billion and could grow by another 1.7 billion. the company is cutting its earnings because of the trades, in the second quarter it did earn 4.96 billion, ahead of analysts expectations. the bank taking back salary and nuses for those involved in the supervising of that bad trade. shares rose early on friday. j.p. morgan says the balance sheet remains strong, calling it a fortress balance sheet. europe and the fiscal cliff. the federal reserve's open market committee releasing the opening minutes, and didn't shed light on possible moves in terms of stimulus. they may need to take action if the economy loses momentum, the.

american airlines opening their checkbook, expecting to spend 14.7 billion on jets made by boeing, the planes will be drivened beginning next year. well, another earning season is here, will it lead to a sweet surprise for the markets? joining me now is jack ablin, jack it is so nice to have you on the program. >> thank you. >> let's talk earnings here, the season is under way for the second quarter. the mood seems fairly down. what are your estimates? >> well, the analysts are calling for a negative 2% earnings decline this quarter, first quarter in about 16 that were seeing losses. mostly on the back of big declines in commodity prices. so at least going into this quarter, expectations are pretty low. >> and the expectations are low, and i think they're still coming down, right?

do y think that the earning estimates are going to continue to come down for the rest of the year. >> well, i think they will, because the expectations are still ratcheting third quarter for the first, and double for the third quarter. they are likely to bring it lower for the second half of the year. >> and what happened that things turned so negative? the unemployment numbers are horrible. it just really seems like we entered a weak spot in this economy the last two or three months. >> yes, i think a lot of it has to do with the doldrums abroad. a lot of the time, we looked at headlines from europe and issues from china. and while we were reading them in the paper, and yeah, we were buffeting our stock market, for the most part we were kind of viewing them as spectators, but

they were impacting the earnings, first in the commodity front. and then we're starting to see it in the earnings front. >> when you look at the multi national companies and how they report the asia sales they're taking a hit on china. now we got the gdp report on china, showing growth of 6.7%, man, we would like to see it in this country, but it is still the slowest pace in china. how troubling is it particularly in europe? >> it is vitally important, and has china shifts from the alliance, the infrastructure that they have been doing towards household consumption, you will see the economy slow in the long term. i would rather sell them ipads and kentucky chicken rather than copper, but it will be a slowing trend, we'll have to deal with that as well. >> were you surprised that j.p.

morgan reported slowing trends, and the stock market up? >> well you know, i will say they are great at managing expectations at investor calls. and jamie dimon came out and said you know what? yeah it is a hit and 4.4 billion is a lot of money, but we'll meet the year-end investments, and investors will take it to the bank. >> there are concerns about europe and concerns about the fiscal cliff, tax uncertainty, the debt ceiling, will we see the worst case scenario? i'm remembering last summer. >> you know the debates that are going on are really the debt and the deficit, and congress just seems to be on the wrong track, and i think there are some members of congress that get it. and they are using the debt debate and the ceiling as trying to steer congress in a completely other direction. and while i certainly understand the frustration of the american

people in -- and everybody else, i think it -- it is going to take turning this battleship a huge direction. and perhaps it is going to take a crisis to get this country to change. >> what about the fed meetings? we had the minutes release from the federal reserve meeting this week. a few said that more stimulus is probably needed. will we see more easing from the fed, and how effective will that be, given that rates are already at rock bottom levels? >> you know it is funny, i view it as three phases of addressing probl problems, first it is the rhetoric phase, a lot of jaw boning and gum flapping. next phase is monetary policies, certainly there was a lot of that with zero interest rates and quantative easing. the next thing is policy action, we wanted it here and in europe, haven't seen that yet much.

>> and what advice do you have for investors? should they change in the middle of all of this uncertainty? >> well, the good news is, the expectations are low, as far as reality meeting expectations, i like very low expectations. so that is a good sign. we have very low hurdles to meet. meanwhile, i would rather get my yield from conservative yields from preferred stock, rather than going out on a limb, you know with small caps, things like that. with the sector space, i like conservative, telecom and utilities, but you know, stay in, but stay somewhat conservative with your allocations. >> all right, jack, good to always have you on the program, jack ablin. up next, the economy and what the president's recent announcement on tax cuts means for you.

on the trail. and later a spin with nascar, what the billions in the driving industry means for the drivers and the track. and we'll take a look at the stock market and how it ended on the week. back in a moment mine was earned off vietnam in 1968. over the south pacific in 1943. i got mine in iraq, 2003. usaa auto insurance is often handed down from generation to generation. because it offers a superior level of protection, and because usaa's commitment to serve the military, veterans and their families is without equal. begin your legacy, get an auto insurance quote. usaa. we know what it means to serve. how math and science kind of makes the world work. in high school, i had a physics teacher

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. well, putting the economy front and center in this election year, president obama announced his plan to extend the bush tax cuts for one year for those making $250,000 of taxable income or less. his republican opponent, mitt romney, supporting an extension, due to expire of course at the end of the year, andrea mitchell is the chief foreign affairs correspondent, good to have you on the program.

>> thank you. >> so what is your take on the tax plan? is it realistic on the economy politics? >> i don't think it is realistic, the white house, the obama campaign really want to which this issue and frame it as we are trying to protect the middle class. and mitt romney is trying to protect the millionaires and up. there is some division, though, in democratic ranks. there are some democrats and senators running in very tight races who are afraid to take this one. chuck schumer in fact, saying cutting it off at 250,000 is not enough, it should be cut off at the middle. so there is some division among the middle, but the campaign thinks that they're on firm ground here. >> i guess the issue is, you know we create jobs, not the government. so if you make it tougher for the businesses, they're not going to create the job. so i wonder if this is in fact,

an idealogy and actually poor politics. >> so i think neither side thinks it will be passed. so they think there will be a big, grand bargain after the election, so no matter what gets elected, there will be a push to avoid the cliff. and what they're doing is posturing. so i don't think they're viewing it in the context of today's economic policy. at the same time, the argument from the obama team is that they are exempting everyone but 3%, 2-3% of small business owners, and that the small business owners, those of who are affected, are really lawyers and others in limited partnership, who are not really the job creators. the romney camp, as you well kn know, are arguing that the bulk of the job creation is among this 3%. >> this fiscal cliff is a big one, i want to get your take on

it. because we're not hearing enough conversation from our leadership about the fiscal cliff. we have spending programs that are expiring as well. >> and the debt ceiling. >> and the debt ceiling. and it will force some economy a number of them, defense comes to mind, to force, to cut jobs because they just don't have the federal dollars from those spending programs. why is it? >> i recognize this is really a hostile situation, they don't want to come to an agreement on anything. but they're just leaving people out there, hanging in the balance, why is it that we're not hearing any conversation about the fiscal cliff at year end? you know we're not going to get an agreement before the election, do you think we'll get an agreement before the election? >> absolutely not, and i think what is happening behind the scenes, you have democrats and republicans behind the scenes that because of the cuts, it would be a reality, people like john mccain, lindsey graham, and john kerr from the labor

committee. these people getting together and talking about taxes. they're talking about tax increases to avoid the defense cuts. but they're doing it very, very quietly. there is a lot of viability built into it. but i think you're seeing senate negotiations look forward to the fact that it won't take place until after the election. >> yeah, we really need leadership to bring us ridiculo? do you think it is a sign the election is in trouble? >> i don't think they were in a free fall, but they have big advantages, the big blue and white plane. and when they travel around the country they get a lot of attention, in local and media markets. at the same time they were out raged, 160 to 71 million in the last filings, that is a big deal. and that does indicate that mitt romney does know how to raise

money. that was his business in private equity. he is really, really good, when he is dialing for dollars on their behalf, they're getting a response from the business and financial sectors, the banking sectors, from the very people on wall street who are still contributing to hedge their bets, contributing to the obama campaign, but not as strongly to the mitt romney campaign. >> you know i was reading a piece the other day, and mitt romney says he is getting a lot of money from wall street, the group that president obama has been villifying, and when you look at president obama, 15% of his is from finance, that is not a small number either. >> but not nearly as much as mitt romney is getting. now what the obama campaign is very good at doing is small donors and building the base. and they can keep going back to the mitt romney people. with all the super pacs and with the outside groups able to raise

unlimited money and not have to even disclose who the contributors are, you have a whole different ball game. >> yes, it is, what a difference it will be, andrea mitchell, joining us on the nbc news. >> up next on the "the wall street jounal report," brian france talking about big business on thewall.

welcome back, nascar is the big sport, more fortune 500 companies are involved in its event than any other sport. brian france is the grandson of the founder, good to see you. >> it is great to be here, with the cars -- sinai know i love the cars, let me ask you about corporate sponsorship, it can cost millions for teams and races. why is it so popular, do you think? >> it is the only place where your brand wican be part of the action, that is just very unique, you marry it with the f fans, it is a before combining. >> who is your fan base today, wh who you say? >> well, our fan basis pretty strong, we have a nice young

demo, 18-35, good for us, and getting better. >> what are they spending money on? tickets, licensed products? the attendance is down, but is this an affordable, spectacular sport for families? >> it is, but on the other hand, our fans drive further, stay longer, cost more in that respect. so the economy fuel prices will affect us, differently than other sports. so that is something we're obviouslily wrestling with in this economy. >> and people are looking at the stars and earning power of some of the best known drivers, let's talk about them. danica patrick, recently moving to the nascar series, what has that meant for her career? >> well, she has brought a lot for us, we brought a lot to her. it is the biggest opportunity for motor sports. she is getting better every week. it is nice to see her in nascar. >> do you see more women in the sports these days? >> well, we do, and in terms of

our fan base, lots of families attend and make vacations out of it. you see that, the drivers have kids in victory lane almost every time. so it has always been a family sport. >> let's talk about the cars, i'd like to stroll around and look at what we have here. now these are all sponsorships? >> yes. >> so we have exxon mobile, m and n's, tell me about the cars. >> this is the car that runs on sunday. this is the championship car that tony stewart rode. >> wow, look at that. >> and we'll put more technology into the cars as we go along. we're obviously locked in step with four car manufacturers, and we're real proud to have their support and financial support. >> i want to take a look around, because this car, it looks like an engine in here, this is pretty extraordinary. >> yeah, they do, you want to be real compact in these cars in

case of an accident. you want to have everything tied down. of course it runs on american ethanol, biofuel, made here in the u.s. >> you just mentioned ethanol, what else is on the horizon in terms of the environment? >> well, taking steps in the industry, they have really rallied around the solar powered speedway, they actually powered it in -- in all of sports, we're going to keep pushing. we validate it, when you really think of us in particular in the fuel area. but with technologies, with what we demand out of these cars, week in and week out, we're just a natural place for technology companies, new biofuels to get involved in it. >> absolutely, i'll ask you more about technology, this is a championship, let's talk about this one here, you got the official soft drink of nascar, the sponsors, coca-cola, this is a good looking car, too. >> yeah, it is, and coca-cola

has been one of our top brands, they are all over the place in such a significant way. they're just a great partner for us. >> technology, you mentioned a moment ago. what do you need to do at nascar to continue to advance in terms of technology? i thought it was really interesting that a driver recently tweeted from a race track fire? >> yes, we -- social media, we have embraced that and announced our relationship with twitter. our drivers are -- really into it. you're going to see more technology with the car. we're going to have a glass dash for it where there is going to be all sorts of data that will go back and forth over time with our fan base. >> it is interesting to see that glass technology in the car, because that is really giving the driver information as he is on the course. >> that is what is going to happen in the passenger car. it will look much like an

airplane, you put the tuitunes where you want. >> wow, itune, are you telling me they will be able to do that. >> well, not so much that, but soon, in the car. >> all right, brian france, thank you for joining us. up next, we'll take a look at the wall street report and the impact on your money. and crunching numbers of the london olympics, golden globe, back in a moment wyer? well, legalzoom came up with a better way. we took the best of the old and combined it with modern technology. together you get quality services on your terms, with total customer support. legalzoom documents have been accepted in all 50 states, and they're backed by a 100% satisfaction guarantee. so go to legalzoom.com today and see for yourself. it's law that just makes sense. [ male announcer ] this is our beach. ♪ this is our pool.

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the website, wsjr.cnbc.com. and follow me at twitter, at maria bartiromo. now looking at the stories coming up, a slew of second quarter earning coming out, bank of america, and morgan stanley, and ge, part of company that produces this broadcast. monday, total retail sales for the last month are out. on tuesday, federal reserve chairman ben bernanke will appear before the senate banking economy. and the consumer price index out on tuesday, and wednesday, finding out how many new homes bing construction, and on thursday, they report the existing homes sold for the month. finally, golden optimism, goldman sachs releasing the economic forecast on the upcoming summer games. they use gdp growth, human

capital, to produce country by country medal counts. but home field advantage produces the most, predicting that host country, great britain will win the most medals. that will do it for today, thank you so much for joining me. a look inside the economic engine next week at central park. keep it here, where wall street meets main street, have