now, first ltro, as i said, 489 billion euros. the net liquidity, given the switching i mentioned, 200 billion euros. this time around we're expecting slightly more. also it was mentioned the collateral too. that's been broadened out which should be positive for the takeout today. talking of positives, there's obviously been an undeniable boost to the confidence and the markets in the increase in liquidity. we receive that where spreads that come in dramatically. i'm showing you the stoxx 600 here, 15% rally since the end of december there. the financial sector also up 20%. i've seen nothing in the credit markets. the financials, 100 basis points tighter since back in december. and as you can see, we've also seen spreads tightening in the debt markets. we've seen it in italy and spain dramatically steeping. showing the qe2, only 2%. before i get too cared away the positives, it's not all been that. now, the ecb deposits at the central bank have increased since the last -- increased dramatically over the last two months with some a

probably ltro related to some extent. and the last chart, also ltro related. up over 70 basis points. it's all about haircuts and being subordinated to the ecb whose positions always remain rather pristine. but no matter how you slice it, it's going to be very interesting to see if there's any follow-through in the world's quality fixed income market rise. >> rick, thank you very much. we have an action-packed two hours. hope you can stay with us here. we've got 50 minutes before the closing bell. the dow continuing to head back to the lows today, down about 35 points right now. >> we're going to check in with the largest asset manager on the planet. he says you should be 100% invested in equities. >> bob dimon is with us. he'll talk about the global economy and increasing legislation. >> philadelphia federal reserve president charles placer, telling us where he thinks historically low rates are doing more harm than good. >> here's how the s&p 500 heat map is shaping up for this wednesday. a little more red than green right now. you're watching cnbc, first in

since we had that ltro things have gone smoothly. not a bad result for the spanish auction. 4.56 billion is the total. that's what they're looking at. the yield and bid to cover healthy. >> i was impressed with the way you did your calculations. you passed your math, i can tell that, ross. good job. here in asia green across the screen as you can tell. lots of people are more optimistic about the global economy. we had better economic data from the u.s. and a batch of stronger pmi. so that spurred some risk taking across the region today. the shanghai market of financials were clearly in play. we had a report that said that the dividend payout will be cut easing some of the capital constraints over in china and that pushed the shanghai composite up almost 2%. chinese financials listed in hong kong also saw a rally and that pushed the hang seng up 2% as well, moving above the 200 day moving average, 20,739. yesterday we were talking about the key 20,000 level. now clearly above that. the nikkei 225 earnings continue to be in focus. we

so are ltros the correct medicine? we have been asking those who should be in the know. >> little change the picture but i am convinced in the banks. >> in the circumstances in which the banking system had funding problems, i think it was appropriate to provide this liquidity. however, the sevcentral bank fo the ecb and also for other major banks have to be prepared to absorb the excess liquidity at a certain point in time. when the economy picks up. >> it's going to be determined by how many people come to borrow, certainly we saw pretty significant borrowing in the first. a lot of debate on whether it's going to be a big one or not. the twas between mario draghi and ackerman over whether it was important or not -- whether you would be a man or not if you took this money or not from the ecb. i think it's important that there not be a stigma associated with lenders of last resort lending. that's the whole point of having these and so if the markets need it, they should take advantage. >>> 0 okay. george, look, the ltro

and ltro one, two and 17 are not going to change this.y have to recapitalize themselves. they're too highly leveraged. that either means shredding assets or capital. what was happening is the u.s. dollar providing funders and also presumably all other private sector funders were pulling out so the ecb stepped in under very generous terms and providing funding for the banks so that's great news for the assets the ecb allows the banks to post as collateral. good news for securities of all types but it still means we might offer sharp credit contraction for the real economy in europe. the trade finance and all of those areas. >> i saw goldman sachs' poll of banks. they are only about 7% of the l it tro going into lending, about 36% was buying sovereign debt and i suspect the rest with the ecb. this is still about banks having cash, not doing anything with it, just so they can feel like they have cash. >> basically what a bank does when it has a banking crisis, as it works to surviving and the way it works to surviving is it derisks its asset

ltro. no move on rates. the euro is 1.3272 against the are dollar. against the yen 103.05. steady on those fronts. against the sterling 0.8. the euro/aussie 1.2413. into the bopped markets and a real tightening of spreads recently particularly with what's going on in spain and italy as well. a bit of optimism about those countries having seen yields very high on that debt. the bund is at just below 2%. just above 2% at the end of yesterday creeping back below that level now and only marginally, only over 5% for the spanish and the italian debt, too. 5.46 for the italian debt. and in the u.s. the ten-year treasury is just a fraction over 2%. christine? >>> beccy, thank you very much for that. up next on "worldwide exchange," no more big spenders. barclays says it's slashing its bonus pool this year following in the footsteps of other big banks but where do you stand on the bonus debate? e-mail us worldwide@cnbc.com. [♪...] >> announcer: bank robbers stole $43 million in one year. but identit

this ltro 2.keep in mind as well, we're looking at gold prices to test that $1800 an ounce level as well. but silver really has been the outperformer. it's up 33% year-to-date. really, it's just making up for the fact it was underperforming last year. kept playing catch-up with the gold market. back to you. >> sharon, thank you very much. less than an hour of trading to go here this tuesday. investors watching the home builders this morning. still saying that the housing recovery has a ways to go at this point. and donald trump said this morning, he's a famed investor in the housing market as we all know, he said real estate is a buy. listen to this. >> housing is one of the great investments right now. i tell people all the time, go buy a house. you can make an unbelievable deal. >> warren buffett said the same thing yesterday on "squawk box" here on cnbc. let's see what the charts say. jeff is with us today, the chairman of renaissance macro research and cnbc contributor. do you like housing? an

what's the problem with the ltro then? >> two i. the first is that oftentimes as we know so well in financial markets it is better to travel to an event, than actually arrive at it. you would buy the rumor, sell the fact, and you've had a very strong rally so far. the second issue would be whether or not you get a disappointment on the headline figure that is actually announced. two dynamics there, very different in nature. >> stay right there, simon. we want to bring in two more voices to the mix. we bring in bob pisani, looking at stocks, along with mark harris at rbc capital markets with more on today's action. gentlemen, simon's talking about the possibility of a resolution in europe, but the ltro is sort of a wild karld out there. how do you think the markets react to a new lending facility tomorrow? >> i'll be honest. i think it's in there, unless we get amazingly of arriving tailwind. i think we'll get to the number everyone wants, the 500, and move on. >> if there's only a low number, 300 billion, is that good news for the m

look at the ltros. that has had a big impact throughout the entire eurozone. >> this is kayla back at hq in englewood. good to have you here. obviously low rates have been the story here for quite some time. we've been able to turn a blind eye because we expect it to stay that way for so long. we are looking at the ltro. it's the reverse where u.s. investors are saying we're worried that the size of the ltro or the structural elements will kill this monster rally we've been able to see. what type of facility do you think the market needs to be able to continue moving in a positive direction? >> well, i think it's going to be determined by how many people come to borrow, certainly we saw a pretty significant borrowing. the there's been a lot of debate on whether it will be a big one or not on the second one. there is the debate between mario draghi and ackerman over whether it was important or not -- whether it would be a man or not if you took this money from the ecb. i think it's important there not be

the ecb will provide an update on the ltro.mbers be enough to keep the rallies in stocks? we bring in senior vice president at new edge. larry, always good to see you. i want to talk about the ltro but i want to talk about the headlines. that is going to decide thursday morning at 6:00 a.m. whether greece is in an actual default. that would be enough to trigger the cbf. >> well, you know, systemic risk -- you know we've been talking about commodities this show. systemic risk has stopped since '08. trigger of a default in greece would potentially destabilize things. you have a lot of things that have to be worked out. it's a $21 billion maturity. that means a portion of that maturity, some of the holders are not in the psi. that's destabilizing. >> so what do you think is going to happen though? do you have any thoughts on whether or not -- >> i think there's going to be a default of some kind. i think there's a certain amount of bondholders that are going to get crammed down and won't participate in the psi. and that has to tri

this is the week before the ltro. the next batch of ltro here.ubtedly saved us from a financial systemic collapse. i suppose the issue we're now wondering about is how do we, is this now the only funding for banks and how must we win them off at some point in the future? >> you're right. obviously a 38% rise in the bank sector since the ltro effectively and that shows how important it was to shore up the liquidity with the banks. yeah, just been with clients this week asking the same question. it's three-year money. what happens in the meantime. it is a matter of trying to get themselves sorted out in terms of loppinger trm funding needs hopefully it has been busy and manage what is going to be clearly an uptick in funding longer term for banks as a whole. >> yeah, because obviously what some of them are doing, italian banks are using money to buy debt. people are viewing this as a leave it option on, i guess, sovereign risk. is that right to view it that way? >> well, i think that's part of what's going on. clearly some of the banks are using wh

to what extent do you think second ltro will fulfill that mission?> the second phase of it stands a decent chance. the first phase really and the banks used the 500 billion euros they borrowed. they use that basically to pay down the debt that they were facing. and i think the second phase depending on how much the take is, i think there's a greater chance that will start to trickle down. it's not something that's going to happen instantly. it will happen over in months, maybe years and the key part of the ltro is not extending credit, it's preventing a catastrophic collapse in the banking industry. >> all right. thank you so much, david, for sharing those stocks with us. that was david embridge at the wall stre"wall street journal." and let's get back out to karen cho. we are awaiting the results of the 1 -month debt auction coming up in half an hour's time. what is the expectation on the grou ground? >> reporter: indeed, carolin. sorry, we have some emergency sirens going off. we've been talking this morning about the government restoring the credi

draghi has done with this ltro, now a second leg of ltro, have things stabilized enough, are you worriedt could spill over into the u.s.? >> i'm just not sure it's entirely about mr. draghi or ecb, but the european government seems intent on managing their way through this crisis. and whether they arrive at the best outcomes or not or the right outcomes, i'm more confident than i was, say, last summer and the early fall that they're actually going to be able to manage their way through it. i'm more comfortable with the fact that europe's going to get through this. maybe painfully. but without this sort of financial implosion that sometimes people are feared of. i think that's become increasingly unlikely. >> you wonder if that's the case, then perhaps corporations could start loosening things up and start hiring again. >> sure. >> let me get your take, last week you said the financial crisis for central banks, including the fed, to take on more risk, to take risky options that go beyond the monetary authorities, should the fed not have purchased mortgage assets to begin with? >> i think

a number of those have receded, the ltro, coming up later this week.ws and very weak earnings results, sales and earnings forecasts for every sector of the market has been falling for the last 30, 60, 90 days and we've had no money flow. those are the issues positive and negative and balances that out. our forecast is for around 1325 for the middle of the year. >> crude down today. how much of this pivots as what energy is doing and going to do as we get into summer? >> in an aggregate sense it nets out. higher oil prices positive for energy companies and takes positivity to transfer into windfall prochts for energy. >> david, we can't get enough of apple. it's one of the most owned stocks. it's on your vip list. one in five hedge funds has apple among its position. do you have a sense this stock is underowned in hedge fund land? >> depends how you want to think about that. there's basically three issues in the hedge fund world. every 90 days the hedge fund community is required to report their holdings to the government. we've had three issues this qu

you're going to have the ltro tomorrow. i think that's going to be important. and i think ultimately the best condition that exists right now in the marketplace is the volatility index has come in so much that you could define your risk. and that's the most important thing that we all should be doing. >> cortez are you getting more bullish? you've been long the ten year. long bonds and now you're taking some off. >> i am. not because, a matter one of the reasons i'm talking the ten year position is off, i think it's going to roolly more but the easy part of the rally is over. i want some dry powder to try to go after shares from the short side. it looks like we might close above 1370 in the s&p. last time we did that was june of 2008. at that time, ten-year yield was above 4%. the euro currency was at 1.55. when you look at the world of foreign exchange, bonds and stocks to me the leg of that stool that does not hold right now or is most susceptible is the equity leg. i want some dry powder. >> karabell it looked like it was going to be a bit of a different day

they issued this innocuous-sounding report evaluating the ltro.ded like the mario draghi for president report. one sentence says, we believe that the ecb's intervention has materially reduced the risk of a liquidity-driven bank failure and averted the possibility of a severe credit crunch and additional recessionary pressure across the economic and monetary union. >> long-term refinancing operation, 1% money for three years. 800 banks availing themselves of this opportunity to the tune of 529 billion euros. this is it, though, right? they're probably not going to do it again, are they? >> that's a great point. the body language is no. we're getting a modest rally in europe. some of the bank stocks up 2%, 3%. here's what i think the problem is. you're right. once we know historically -- when central banks turn the spigot off, stock markets run into trouble. that's going to be a problem for the market if the ecb says, this is it. find a way for your banks or money market funds to start funding your operations. by the way, we're going to have this pr

we are wait iing for ltro.f we get a consensus number, $490 billion, say, is that good for greater market risk? is a big number good or is it the other way around? >> well, it depends of course on what you are asking for. first off, a bigger number will be good for the periphery. we could see some reaction there obviously as it is seen that money is ultimately supporting the periphery. trade which we are skeptical of and still results in that buying of the bonds. i wouldn't say it's negative for the core out there and that is because, question, initially you could see reaction on the negative side but we've seen the first ltro with the rising tide lifts. this is not a zero sum game. this money ends up to am some extent in core bonds. >> do you have any estimate what proportion of the $500 billion will go into the carry trade and peripheral debt? >> we do. we published the report on friday. we've broken it down to a number of components and 0 our estimate is around about $400 billion so that is short of the cons

i think the ltro is going to give a booster.s what happened when the ecb had the last take up. just short of 500 billion. that's about what's expected to be put into the system next week. so that's a significant liquidity boost. so i think commodity currencies could see a rally. >> so you want to effectively be long kiwi? >> that's right. i like the kiwi dollar because reserve bank new zealand is not cutting rates like reserve bank australia is. i prefer it to the aussie dollar currently. and the ltro operation. it's had a nice bounce up. i'd enter it here. 1.5970 the short. i look for a move to 1.55. >> thanks for your time. >> thank you. >> catch more "money in motion" friday here on cnbc. >>> coming up next on "fast," we'll meet the man slapping paulson with a lawsuit. and we've got the trades tonight. more "fast money" straight ahead. looking for a better place to put your cash? here's one you may not have thought of: fidelity. now you don't have to go to a bank to get the things you want from a bank. like no-fee atms -- all

the introduction of ltros and we have more lined up later this month. seems to be tiding over the situation whenever we have european bond auctions but the final metals don't seem to be any different now. in fact we have comments out from wen jiabao now saying he supports strengthening fiscal can discipline in europe. ultimately do you see the debt markets in europe? a lot of these countries being able to come back to the market and get inhave i tags ts, in fact, get interest from the likes of china anytime soon, let's say next year. >> it's a tough road. i think the conditionality is there that they have to get their house in order and i think it's at this point more of an it than a when and so when the chinese decide to put money back in, i don't think it will be in the near term. i think they may save face, like i said, at the edges to do some small activity, but i don't think they'll go in in any big way at this point in time. >> yeah. seems to be the case at least judging from the drumbeat of comments we continue to get ahead of that big summit tom

is it calming down, the ltro?secondly a long-term three-year operability, the ltro and thirdly raising money for banks. anyone with credit can go to market. portugal is a little like cranston, rhode island, not important in the grand scheme of things, even spain can borrow money. all good things can come to an end, equity has just had finally a great bull market in january, m&a will follow and i talked to my clients, our firm represents companies in every sector of the economy, we're talking about a lot of stuff. there's a debate -- >> because they can use their currency. >> you can use your stock and cash. you can boor row. >> borrow for free. >> borrow cheap money. american companies are sitting on $2 trillion worth of cash and what does everybody want? access to the american consumer. it is going to end. it is. >> i'd say two things, i don't think m&a necessarily kokz strong because of the big elephant deals. you see a lot of activity of breaking up big companies because it's sustainment term on investment capi

so the ltros from the european side and the prospects of qe-3 in the u.s. side.e're past the ltro today from the testimony today it looks like chances of qe-3 set back. the macro economic data will continue to be solid the upside surprises are going to start to slow from here. so i do think the chances of a setback are greater at this juncture. interestingly, earlier this week, looking at statistics, a bull market. we're about to come up on the third year anniversary of the bull market next month. we started in march 2009. we're running at about a pace of a2% monthly average gain in the bull market. most bull markets that make it past the third year anniversary slow down to 1.7% gain which means trajectory has to slow or we need a setback. to me, it's a soft patch over the next month or six to eight weeks but that's going to be your buy opportunity as we get into probably first quarter earning season which is middle april. >> looking at that as the next catalyst. could you make the argument there's more bias to the upside if you don't have a major blowup in europ

regardless of the successful ltro the market is getting fatigued with europe. >> as a trader you have what could happen, i'm not saying it will, we don't want to it happen what if there is a disorderly default there, what could you see doing with the euro dollar? >> the market is starting to prize that, i think the market is realizing social unrest could lead to say 50-50 chance of withdrawal of greece from the euro. who knows, by year end next year, i don't know. now that the market is factors, if that were to occur the break-up could mean 1.15 to 1.18 on the euro, i think by the time they get to that point it would be more orderly than perhaps the market is thinking now. still it would be a sub 1.20 move. >> good to see you maul -- paul. >> what is the hoopla? >> let's see what it is. >> somebody is ringing the closing bell i forget. >> you want to tell everybody? >> i'm not. >> take a short break then we'll tell you who is running the closing bell. the market is coming back, little excitement in the room, down about 30 points on the dow. >>> february has broken the hearts of invest

part of it is things for ltro, quantitative easing money. but part of it is disappointment without all of that liquidity pushing certain metrics. durable goods on this one. as these rates come down, we're also seeing another phenomenon today. february is a big corporate issuance. as we move towards the end of the month, we're seeing telecom, burlington, and we want to pay attention to see if this is one of the biggest months of issuance in dollar denominated terms by highly rated investment grade firms. back to you. >> rick santelli back in chicago, crude oil down a little bit. still below 109. let's check out the latest moves in energy and metal. sharon epperson is at the nymex. >> i'm standing where the market is in the metals market. keep in mind, we have seen all of the injections of liquidity, quantitative easing, since the beginning of the year. gold is up $180. silver price up 25% and they are about the biggest gainers in the market today as well in anticipation of the ltr. keep in mind as well, copper is at a two-week high. we're als

>> no, i think the ltro, obviously that's a quantitative easing program. i think we're likely to have some bad auctions of italian and spanish longer-term paper. i think the ecb is going to get much more adegreesly involved here. believe me, they're going to be buying a lot of these bonds as the year wears on. that's going to help. maria, i think what that really does is that kicks the can down the road. the market's fine with that. but you have to realize that this is just kicking the can down the road. none of these things are solving the problems. those issues of the european sovereign debt crisis, we are going to be revisiting these things for years to come. it's not going to go away anytime soon. we'll have some bad things happen. the market will be very volatile. then things will get kicked down the road and we'll be able to trade off the fundamentals. it's a start, but there's a long way to go to cure this european debt situation. >> real quick on you both. let me find out where you want to be positioned then in this environment. scott, you're basic

so i think those two -- >> as part of the ltro? >> it helps the banks -- it allows the banks liquidity, more confidence with the banks but i don't think you can separate the sovereigns. they all go bust the banks won't be sitting there all fine. you can't get rid of those two. italy to some degree has decoupled from greece. portugal is probably more in the spotlight but notwithstanding that italy needs to raise so much money and there's such fragility i think we'll be talking about it all the time. >> not this week but next week. okay. thanks so much for joining us. ceo of swordfish. >>> our next guest says he sees risk appetite return and equities in emerging markets are undervalued. joining us is the chief strategist. the dow up near 13,000. the dax, as i said up over 17% now for the year. i suppose the question is at this moment whether you think we're getting a bit trechd in this rally. >> i think that's probably the case in the very short term. some market participants have been waiting for a number of weeks now. we think the

we're also going to try to see if we can go three hours without saying the words ltro. >> ltro ltro. rather than ltro? >> low cost loan program, lclp. >> i'm asking everybody on the twitter. >> cramer, you look like you're at an uncomfortable function where you have to wear a jacket. >> it's true. >> i thought they relaxed those rules down there. i remember our -- some of the ladies down there don't have to wear a jacket anymore. do you guys really have to wear those, do you know? >> that's what we're told. but if you'd like to say something to somebody -- >> i feel like i'm a partner somewhere. >> are your sleeves rolled up under there, jim? >> this is such an uncomfortable outfit for me. how did you nail it? i feel like, geez, who am i. >> you're fidgeting around. >> i know! >> alan schwartz has a question? >> if you feel like a partner, would you join a partnership that would have you as a partner? >> why would i join that club? i miss you, alan. >> that was good, jim. that was good. >>> coming up, we'll get some final thoughts from alan schwartz. "squawk" is coming right back. >>

of course, we're all going to watch that ltro.ne final thought, we're looking at volatility in the treasuries, drifting a little bit south. also we had a lot of supply, so look for extension trades next week. back to you. >> all right, thanks, rick santelli, of course, talking about rates there. you know, it's interesting. we also continue to follow the capital markets in terms of how much they giveth to corporate america when it comes to the debt side of the balance sheet. viacom announced $250 million at 4.5% for 30 years. 2-year money at 1.25%. they can -- tax deductible is the interest on it. you can buy back dividend paying stock, retire the stock. they'll under pay the dividend and have it actually be positive to cash flow. >> is this a creeping tenner? a creeping self-tenner? the amount they're buying back at viacom is incredible. >> a lot of those companies. newspap news corp., viacom, time warner not as much. the incredible cheap money that's out there, we're lower than we've ever been. even bbbs now are borrowing at rate

things have turned around a lot since the ltro. what do you think is going to happen with the next charge? does it depend on the collateral conditions? >> i think that's a big, big contribution to the whole thing. one step back and we think in general the whole l it tro exercise and the collateral pool is a tremendous step by the ecb, a tremendous help to the market, seen as a response is part of the success the ecb has still in the market. the take-up in the l it tro is difficult to assess because it depends on a lot of variables but the collateral pool i would say is one of the biggest contributions the ecb has made so far. it prevents banks in europe from keeling over in a short span of time. >> and very briefly, peter, do you expect -- we've seen italian peripheral yields come down. what do you think happens to core yields? what are you expecting from treasuries and bonds? >> well, it's a bit -- in a way if the ecb and other banks are flooding the system, at the end of the day we think there's still a lot of risk scenario price

>> if the fed comes in and says time to raise rates or if europe, the ecb says no ltro, the ltro is incrediblyontinue having the pumps open in a big way, there will be a major pricing of markets. >> are you still with us, rick? >> reporter: i am. yes. >> you're constantly telling us about moves in the ten-year but don't you attribute, don't you think the entire ten year is rigged where it is right now anyway? tell us about these moves based on economic numbers, but how much of it is the fed just orchestrating the low rates? >> reporter: absolutely, absolutely it's rigged but i think that at the end of the day i was looking at trying to see if the markets would reach a tipping point. the notion for the fed leaving at certain rates for a certain amount of time is useless information. they're brag being a non-strategy but i think if you see interest rates in that environment start to trade up is starts a chain reaction of events that is enlightening so yes it's distorted but even within that distortion there may be a reality, they can only squeeze this water balloon for so long and trust me, when

the european central bank, under mario droggi's leadership took an important step with the ltro facility, a program that lent a lot of money to banks on various generous terms. all that moisture, all that liquidity, if you like, hazardoused the immediate -- doused the immediate flames. if you look at the crash in the six to nine months the risks have been brought down substantially by what mario has been able to do. if you look at the deeper tensions in the euro system, the fact that you have areas that become depressed and because of the common currency they can't devalue because there's one currency. they can't cut their interest rate because of the way europe is, people don't move in and out. those structural tensions haven't really fully been resolved. so the europeans have a lot of work before them. there's a lesson of economic history, which is you can't simply cut your way to greatness. short run, i feel much better. risks that in this key year for the united states, europe will knock us off track. i think those risks have receded significantly, but for the medium term there are v

. >> i'm backing it with the equivalent of half a billion in ltros.veremphasizing what we're going to get on february 29th. likely to see another half a trillion euros done between that. that's put so much liquidity back out in the markets. >> that's a firewall. you'll have a trillion euros, you believe, to be sitting there. and that's the firewall? >> yes. you can see it in italian spreads. we've come in from peaks, 200 basis points. 100 basis points from the december ltro first launch of it. if containment isn't held, we have much bigger issues. but the fact we've gone through rioting and burnings in greece overnight, six downgrades and we've seen france and the uk put on watch by moody's at this point, to me, it tells me markets have very much corralled and contained greece. >> the outlying problem, though, that you are paying perhaps more attention to is the tensions between the u.s. and iran, israel and iran and the middle east. >> yes. >> why? >> i think the markets, again -- >> other than the obvious. >> the obvious, how incendiary in nature th

you take that away from the fed, you take the ltros away from the ecb, the bank possibly stepping away and i think people would be in denial to think that's not going to have an impact on global equity markets since test the qe in fact that's lifted them so much over the past couple months. >> that's absolutely right. as for commodities, of course today we're seeing quite a selloff in gold, silver, oil and many other commodities, john, how excited should we be about this pullback? is this presenting some kind of entry point for people that perhaps have missed out? >> well, you know, we've only had a very modest pullback today. so i wouldn't get too excited about that. but if you look at the commodities that have taken a beating today, i do like a couple names in that space. freeport machina ran. i do agree with peter, we do have to have some concern about having come too far too fast, but i still think equities are attractive at these levels. >> you also like diamond offshore. thank you for joining us, peter and john. let's check out now with seema mody what is happening at the nasdaq.

also with the ltro i absolutely agree it's helped with the liquidity issues, but it has not solved the solvency issues and you're looking at portugal in front of us. you're looking at the elections in france in front of us that could also be problematic. >> sounds like you think then greece will default. >> i think the odds are probably about 70% that greece will default. we can't kick it down the road. they have to pay the coupon payment to the bondholders march 20. >> feels like we're kind of sitting on the cliff here right? it may or may not. we don't really know what's going to happen on monday or further town the line. how do you invest, bottom line it for us, what the investor should be doing? >> we like the u.s. equity market. you look at the u.s. equity space. build your way up and start moving globally. cha n china's going to have a landing, we think softer than harder. cautious buildup. >> mark, your bottom line and what the retail investor should do riegtd now. >> my bottom line for the reftal investors to be cautious. europe could explode. we could have a financial crisis t

as the ltro have we cordoned off greece successfully in europe, have they?in ltro every time. >> i don't know -- >> long-term refinance operation. >> they lend money for three years. >> it's their version of qe. >> right. >> i this i that backstopped europe and i this that i markets are going to care about greece when they care about greece and at the moment, it strikes me they don't care a whole lot. i was surprised to see futures up this morning. i was surprised -- i thought they were going to look at what was happening in the streets and get a spook and i'm struck by what you said at the break, maybe greece doesn't mat ere anymore and joe has been talking about this a little bit. it's an interesting question. greece has never mattered from a strictly financial point of view in the sense that what happens in greece is going to have an impact from a financial standpoint. it's a contagion issue, what happens to portugal and italy and we know the ltro has essentially backstopped italy and spain for the moment, with he see yields come down well below 6%. >> th

in november/december, when you had this announcement of the ltro where the ecb was going to provide a three-year lifeline to the european banks, the market's really embraced that as a risk-on type of event and it's been a game changer. long term, i think we all agree it doesn't. but when you have three years where you don't have to worry about european banks, the market is celebrating that. >> and the ltro have access to money and liquidity? >> exactly correct. >> in the global arena, i know you don't do the international side of things. but does the u.s. still look as compelling to you as some of the other foreign markets? >> i think it does. the other area that's attractive are emerging markets. you have companies with strong balance sheetings, strong growth rates and they're selling at really low multiples. that's an area if you bet on it last year, you didn't get paid, i think this is a year where u.s. is going to do well relative to the world. and i think emerging will as well. >> jonathan, thank you very much. good to see you again. >> always a pleasure. >>> coming up, when we c

to the ltro looking ahead to another one the end of this month, certainly had a beneficial impact.s. taking a look at the futures this morning seeing we're poise ed for a higher open on wall street. at the moment if the markets were to open the dow would be higher nearly 38 points, and the s&p 500 higher by 3.7 and that's before the long awaited friday jobs report. interesting to see how those numbers come in. to talk about those numbers we've got todd horowicz, chief strategist, the trading group and of course j.j. burns is still with us. todd, let's start with the employment number today, looking for an increase in 125,000 jobs, 8.5% rate to stay unchanged. do you agree with those figures? anything you are looking for today that may change your view? >> first of all, good morning, jackie. thank you for having me. i think the numbers will be better than expected. we're pricing in a better number. so i think the numbers are going to be actually better. the unemployment rate itself, the headline number i think is really meaningless on its own because it's a number that you look at i

. >> what's an ltro?> it's basically -- >> an emergency loan. >> exactly. >> another trillion. >> 500 billion euros to a trillion. trillion would be great. my concern is if it's 500 may be a little disappointing. but you have massive liquidity from every developed nation and even some undeveloped nations, some developing economies. that's just flooding into the market. you can't really go into fixed income at this point because you're not -- >> good, stay out of bonds. >> so buy equities. >> what's your big shop, what's your crew doing? >> we've been overweight stocks since the bottom of the market i guess in that october, november period last year. i'm right with stephanie. the sectors we like best domestically are technology, financials, and consumer discretiona discretionary. we are overweight emerging, overweight small cap. ? you're overweight emerging too. >> yes. >> do you think it's just because they had a bad year or are they showing us a new -- emerging markets, they're like the junk bonds. they'

i think what the ltro has done has addressed that. addressed that in terms of better situation. think the more important issue is not whether it's going to be a difficult and rocky trajectory, because we all believe it will be, but we're in a much better place than we were with the leadership in a couple of countries changing, the leadership in the ecb being quite strong, and this new liquidity facility being put into place. >> all right. pleasure to have you with us. thanks so much for joining us. come back soon. >> thank you. >> we're going to take a quick break. and tomorrow's power player, more than half a trillion dollars worth of investment advice will be right here. t.rowe price brian rogers will tell us where he's putting all of that money to work in this market. kayla, over to you. >> up next on "power lunch," the fed pulling the plug on phil falcone's plan for a national broad band network. what's the damage to the hedge fund billionaire's financial empire? we'll have that story up next on "power lunch." [ woman ] my boyfriend and i were going on vacation, so i used my

that would clearly be a negative for stocks. >> so right now -- you mentioned the success of the ltro the month. will that give us a sweet spot where there's more liquidity that would be pushed into the system, therefore that's good for equities? >> it certainly helps in a number of ways. it's always good for stocks and risky assets. ltro has done a very effective job of removing liquidity crisis or the potential crisis that european banks are facing in the fall, and finally it has indirectly helped from lowers the costs, and to the extent these cunning have more time, this will also help mitigate or remove some of the risk coming out of the europe. >> i want to talk about the sectors you are overweight, energy, technology and tell com. i'm curious to to why you have that up there with technology. is it the allure of the dividend yields that a lot of these companies have? >> it's exactly that. right now i think investors are taking more risk. right now we're advocating that you take a bit off the table. one of thes to do that is an allocation to some of the lower beta sectors like tel

many thought the ltro would actually really bring. >> well, that's the inefficiency of this.he fed goes and buys bonds and lowers it. the ecb finances other paper and hopes that the banks will go out and buy sovereign. some of that ends back on it. real quick, both things that happened this morning in general are towards a solution of the european crisis. >> all right. carl, back to you. >> thank you for that, let's head over to chicago, get a check on the dollar and some bonds. rick santelli at the cme. good morning, rick. >> good morning, carl. i don't know, is it just me or did any other viewers or listeners out there get a little ripple up their spine when steve liesman said the ecb's kind of playing the role of a bad bank? a central bank, one of the largest central bank is a bad bank, makes me nervous. anyway, let's concentrate on foreign exchange. all the news of the day done to the fx market? well, let's look at what's going on with the euro. as steve talked about, e yes, some volatility, traded over 1.33. how far back do you have to go? pretty much december, fresh dec

he provided this half a trillion dollars via the ltro.point does america l and draghi, at what point does that relationship become a little contentious? end of february we're going to see an ltr or could potentially grab another trillion dollars in the euro. that could be devastating to the stock market. >> i don't know if that would be devastated. germany wants a lower euro, print a trillion, knock yourself out, that's what merkel will say. >> get steven weiss in here. were you the one the other day saying the yield on the 10-year was going to 1% this year? >> no. it wasn't me, but i'll take credit for it. i think what happens is there's no other place for liquidity to go when you get new ltro. talk to huge portfolio managers. that's what they're looking for. that's why they're bullish. bonds are tapped out. >> kilburg, final comment, quickly? >> i think your going to see sensational there's nowhere to go like steve said. >> final trade's next. until the end of the quarter to think about your money... ♪ that right now, you want to know w

if you look at euro crosses, we've seen a very, very sharp down trend since the ltro was announced. if you look at it on a broad basis, the euro has been quite weak even the last couple of weeks. in terms of euro/dollar 1.25 is a reachable target for this year. we've been trading that since last week. we did get lucky getting short around 1.33 and we think 1.25 is realistic and that relates back to the capital flow analyses we've done. there's a pronounced structural weakness in eurozone capital flows both coming from the inflow and outflow side and that's one of the key factors we're looking at. >> we'll continue to talk with the head of g-10 fx strategy. he will be here for the rest of the hour and still to come a greek bail quout will be decided by monday ahead of the euro group. has greece really done enough to impress its european lenders, and how bad is the risk of contagion to other countries? live in lisbon next. >>> welcome back to "worldwide exchange." i'm kayla tausche on the east coast, just about four hours to go before the open of trade. right now futures are relativel

we have another ltro coming up.there is a feeling here that whatever happens, we've saved off a bank collapse. my sense of question is, how do you balance out the optimism that we're not going to get a complete bank cleps collapse with the fact that whatever happens, we're going to have pretty poor growth here. what is an investor to do with that? >> i think actually we're taking a different view at the moment. certainly the market is much less worried about systemic collapse. so i think the real surprise in the past couple of months is that the data has been fairly solid. you're talking about tpmis in particular. so, you know, sure, there's probably a mild recession, but it looks as if some of the nasty minus 2% growth numbers we were talking about three or four months back, they now look too pessimistic. >> we'll talk more. great to have you on the program. richard jerram. >>> after reporting fourth quarter results, investors were disappointed with sanofi's outlook for 2012. ste fap was speaking with the ceo and j

it could come as early as next week with the ltro, number two. >> you have two great pressures.ere's pressure on pension funds and other funds to put money in. so that's the one explosive side that could take you to the up side. the other part is that this is kind of a strange rally. it's coming on a declining number of new highs. stocks have fallen from 80% to 50%, so it's not a pervasive rally, and that's got doubters in there, but that's good. that's what you need. >> great to speak with you. art cashing, from ubs. we're watching dell this morning. it's down, we're going to break apart of large-cap tech names, and talk about the pc market and much more in just a few minutes. stay tuned. so -- tell me again what happened. i was downstairs making coffee, and we heard it. it just came crashing through the roof, out of nowhere. what is it? it's our ira. any idea what coulda caused this? maybe. i just sorta threw a little money here, a little money there. and i loaded up on something my dentist told me was hot. yeah. ♪ [ male announcer ] the 2012 m-class continually monitors blind

you'll see more ltros, et cetera.at's different. for that, we haven't as yet got enough cushions, fiscal deficits are way too high already, interest rates are at zero. if you define the moments as a payment and settlement system, lower risk. if you define it as the economy being able to take a shock that's a higher risk because we are in a worse place than we were in '08. >> my question is, i've heard all this, i agree with 99% of it, where do you put your money? >> well, this is where you've got to have a few principles, right? and we would cite three in particular and i'll tell what you that means in terms of asset allocation. one is prudence, prudence is important here. second is patience. you will have a lot of opportunities as these things play out and third is optionality. don't underestimate the importance of optionality, so in a typical asset allocation at today's valuations, whatever your equity weight is, you want to be under weight. you want to have selective commodities. you want to have gold and oil becau

ltro, second round coming as well. i think for a trade you could play the injuro from the short side right now, because this overwhelming pessimism that everyone has had, the reality is in terms of price action, deterioration is not coming to fruition. >> cortes, how do you see things here? it's obviously apparently moving the injuro dollar today. >> yeah, you know, i want to see the final draft whenever we get it. this is about the tenth final draft that will come -- >> never a believer. >> but i think it will be a sell the news phenomenon. we saw a drop in germany. i have argued for some time germany is not okay. the second piece of data is ubs. really a pretty demonstrable gap, and i think european banks, so either the european story, the 2rub8d story is far from over, and the currency should be short shorted. >> give me a trade, cortez. >> let me just tell you first, exactly what joe talked about. i've been short the injuro currency quite a bit in recent months, but the reason i'm not now, i think it was too crowde

we are looking at another pretty meaty ltro auction next week from the ecb. so more money raised by spain today. something like 34% of their total issuance needs this year have already been met. still to come on the program, we keep our eyes on the retail over the u.s. as walmart and home depot kick off a bumper week of earnings. what to expect at 11:20 cet. and fashion week. why the company's ceo is just as excited about growth in flagship markets as she is about those in emerging ones. stamps.com is the best. i don't have to leave my desk and get up and go to the post office anymore. there's nothing worse than going to the post office and waiting in line. [ male announcer ] with stamps.com, you can buy and print real u.s. postage for all your letters and packages so you'll never have to go to the post office again. they took a post office and sat it on my desk. it doesn't take up any room, i don't have to wait in line and it never closes. [ male announcer ] now you can avoid trips to the post office. go to stamps.com and get a 4-week, no-risk trial. it give

this comes ahead of the latest ltro. we had good jobs data out of the u.s.he liquidity measures of the ecb have restored some sort of confidence to the banking system. at least we don't think it's going to collapse overnight. do those things weigh out over weak growth in europe for investors in the short term? >> it changes week to week based on the data. they can drive prices up and have done since the beginning of the year. there's more liquidity in europe provided by the ecb and the u.s. economy seems to be relatively growing better than europe in other areas. it's a big market which helps everybody else. every time we get a bit of data, the market can change. what's against us is still the debt crisis which is in the eurozone plus the fact it's clear just from that news item that deleveraging the banks engaged in is still a long way to go and the eba is trying to get them to raise capital. people think that's not even enough. they can't do it by going to the market. they can't really do it by going to the government anymore so they're forced to deleverag

collateral will stay the same for february's ltro than it did in december. that will be very beneficial. and also whether he's going to pavin the way for an interest rate can cut in march or not. so that's where the focus is going to be. i don't expect him to say much about greece because there is no deal on the table. with no deal on the table the ftse 100 is up. xetra dax is up.6%. we've had a huge amount of corporate news out as well today. i will just pick out three of those key ones, credit suisse came out with a big $1 billion loss in the last quarter. that dragged the whole of the bank down to a loss. the shares today in switzerland off. ing stock down 4.7% this morning. a bigger than expected loss in its insurance 0 operations. the stock down there. rio tinto came out and also talked about a 6% fall but a bigger than expected dividend. the share is off a bit and we saw daimler, spoke to dieter zetsche. they're going to focus in 2012 restructuring the business. investors like that, the stock up 3.7%. besides the ecb in greece we are focused on the ban