gary kaminsky and what's still to come.>> yes, and, carl, the timing could not be better. we'll talk about the fed and how the sio of fixed income is telling their clients to position themself. "squawk on the street" right back. [ tires squeal, engine revs ] ♪ ♪ ♪ [ male announcer ] not everything powerful has to guzzle fuel. the 2012 e-class bluetec from mercedes-benz. see your authorized mercedes-benz dealer for exceptional offers through mercedes-ben financial services. my dad and grandfather spent their whole careers here. [ charlie ] we're the heartbeat of this place, the people on the line. we take pride in what we do. when that refrigerator ships out the door, it's us that work out here. [ michael ] we're on the forefront of revitalizing manufacturing. we're proving that it can be done here, and it can be done well. [ ilona ] i came to ge after the plant i was working at closed after 33 years. ge's giving me the chance to start back over. [ cindy ] there's construction workers everywhere. so what does that mean? it m

kaminski: cryptosporidium was a wake-up call. it was a wake-up call for us. it's a wake-up call for the nation. take care of your infrastructure before you have the kind of problem we had. biedrzycki: by no stretch of the imagination do i think we're out of the woods. recent cdc statistics indicate that up to 32 million cases of waterborne disease occur each year in this country. roy: but the vast majority of waterborne outbreaks go undetected. when people first get ill, they think, "oh, it's something i ate last night." they don't think, "oh, it's something i drank last night." narrator: the milwaukee incident pointed out the potential vulnerability of our drinking water infrastructure in controlling the spread of illness. biedrzycki: it's incumbent upon us to try to stay ahead of the curve, but it's very, very difficult. there's always another bug on the horizon. narrator: in 2008, the associated press reported that water quality testing across the nation uncovered trace amounts of pharmaceutical compounds in the drinking water supplies of millions of ameri

blankfein to gary kaminsky. is that good or bad news. >> good news because he has managed in a difficult environment. we all know that. the departure of that employee that really ripped the firm. a big negative but addressed that with the interview with gary as well and said goldman is evolving. i think he is evolving and doing a great job managing risk at goldman sachs and the real question was, going forward five ye years, ten year, how much are the changes going to affect their ability to earn forward. >> caterpillar, shares falling 4% dragging on the dow despite a strong quarter. our next guest talks about it and the company's forecast. a buy rating on the stock and comments from the earnings, economies in europe, china, brazil slowed. sales in china were off in the first quarter, likely down for the full year. how much of a problem is that for cat? >> well, it's a big headline problem. i mean part of the issue is cat telling people how great china is and how strong they are there. turns out it's about 3% of

gary cap i gary kaminsky is watching.le who played on friday. >> i was looking at people who didn't win. we have to put coveraa close on lottery coverage. one man bought three tickets. i have a better chance of getting hit by lightning and what happened to bill? he actually got hit by lightning after he purchased those three tickets. he's okay. but just sort of a good way to wrap up the lottery coverage there. >> i don't know fits a good way to wrap it up. >> he got hit by lightning. he didn't win. i'm sure he's happy today that everything is okay even though he didn't win megamillions. >> i would play again if i were him because odds are in his favor since he's already been hit. >> i'll be down at the new york stock exchange tomorrow. we pointed out last week it report on the street about apple portfolio manager did not buy it. long apple, short apple, no opinion of apple, check it out tomorrow. he'll be with us first to talk about why he wrote this report, what does he see that south side analysts don't see and then mak

kaminsky's right.ber we had that flag, all the manager backs in october, we were at the exact s&p number that we were in tween and everyone said last time it went down. we're up 30% from there. but we could do another 20% from where we are and the retail guy is not going to be back here, you're not going to be in a cab where the guy says hey -- go ahead. >> when you look at the first quarter, you have the s&p up 12% in one quarter. despite that volumes have stayed down and investors have stayed cautious. >> what percentage of your clients have their money -- what percent is in cash right now? do you have any any sense? >> on an historical basis more than one would expect against the back drop we have here, with an economy that's starting to get healthier and a fed that's starting to acknowledge that yesterday, with the s&p up 12% in one quarter, the reaction to that set of facts is different at this time than it would have been in the past. >> there's $10 trillion sitting in cash right now in banks. th

gary kaminsky also looking at spanish debt as well.a chance, as much as people think -- i didn't know what simon was going to say and he didn't know i was going to add credit default swaps on to the banks. he showed the equities. look at this. not only is it the equities, it's the credit default swaps which are again being traded and are reflecting the type of concerns, need i say, that we had a year ago when there was these concerns, as simon pointed out, with the french banks about the sort of interbank contagion. >> three companies have taken aid. ireland, greece, portugal. if spain became the fourth, how much damage would there be? how much of a surprise would that be to people? >> you know, that is an interesting question because we began -- when we talk about spain and we talk about italy, we start talking about a different size. and the question simply becomes, is it there because there is a sort of, the likelihood that this is an attempt to basket everything and put it all together? so, i don't know the answer to that, carl. i

andrew ross sorkin and gary kamins kamins kaminsky. joe will be back tomorrow. >> thanks for bringing the donuts. >> should i put my jacket back on? >> no. he knows i'm a dunkin man. not betwegood for you, but it's good thing for you. >> here we go. anyway, gary, thrilled to have you. we do have a lot of news to tak about. here comes donuts. >> what a way to start the morning here. this is more important than the fmoc meeting, can i just say? >> gary, you are dangerous. >> as andrew was saying, not good for you, but very good for you. >> very good for you. >> i'm going to watch from here, although i had hard peanut brittle upstairses. so keep those away from me. the fmoc concludes with a rate decision tomorrow at 12:30 eastern time. plus we get theman bernanke. never sure what will get said at them. also we have the case shiller home price index at 9:00 a.m. and then coming up at 10:00, new home sales and the house price index, consumer confidence and the richmond fed survey. so plenty of things to dig through. not so great in europe.

first, our capital markets editor gary kaminsky has a look about the facebook ipo road show.o present right now. >> it's fascinating stuff. in all years this was one of the most interesting things that i got a chance to look at. let's explain to people about the road show. they hear about road shows. they know it will come up facebook in mid may. it prohibits a company from giving forward looking statement. they can't give a business plan. they can talk about growth opportunities but institutional investors, biggest hedge funds in the world know they won't get anything that hasn't already been disclosed. the road show is a performance. it's a performance to hit the road and in the case of facebook i'll tell you right now they don't need to go on a road show. they can sell the deal tomorrow and one-hour internet presentation and call it a day. they will do a road show. what we are going to talk about right now is the kind of stuff that facebook would tell people if they could. the reason we are able to do this is because the hedge funds as i mentioned, greatest hedge funds in

gary kaminsky is up next talking about low rates around the world, even though, gary, didn't get a cut >> well, actually we're going to talk about higher rates because you were talking about higher rates and obviously the impact the sovereign higher rates have had on the european markets. let's take a look at one asset class that a number of you have written into me about and wondered why have the mlps, an asset class that we've spoken about many times on the air, such a bad first-quarter performance. take a look at the mlp index. that's going back the last three years. investors got used to a one-directional trade there. sort of plateaued. if you take a look at the career-to-date chart and you see where we've been for the first three months, you get this issue, well, there you go. i mean, if we benchmark that against the s&p, you would see a very clear picture. very good relative underperformers, and there's basically three issues that are sort of overhanging this asset class. let's take a look at what those are, and that's basically rising bond yields, the concern about higher intere

let's get to our capital markets editor gary kaminsky up next with a look at the fed tomorrow. on rates today. >> and carl, at the top of the program i said i'm not sure why europe has become such the focus again. i've got to tell you listening to simon go through that report maybe it's the answer. so many moving pieces and so much to be concerned about. the technicals, fundamentals, elections, earnings, economies. i just got the answer to the question i didn't know. interest rates, we don't talk that much about interest rates in this specific segment but remember any historian of the stock markets knows that interest rate is probably the biggest single factor over the long-term on equity prices. i read something over the weekend. let's look at some data. us cpi inflation running about 2.7% right now. ten-year government bonds, we were talking to tony crescenzi about this, yielding 1.9%. with the negative real rate of something like three quarters of a percent. now, carl did you catch any of the ron paul commentary on "squawk box" earlier today? >> some of it. >> obviously he's

i'm becky quick along with joe kernen and gary kaminsky. andrewoff today.eturns yet,

for more on markets, our capital markets editor gary kaminsky joins us on the phone.g you think this reversal means more than a one day give back. what do you think? >> it's a nice bounce back after i left you yesterday afternoon i went out to speak to a number of people. i think it's important to remember the key bank index was up 25% for the first quarter. best performing sector. so as it relates to earnings in terms of trying to see we pointed out the correlation between the s&p and earnings estimates. there's so much focus on financials. there's so much focus on one cart in the apple but so much focus on financial, earnings that we'll see on friday and into early next week and whether or not the stocks reflect the improving fundamentals or they don't. we're in a bit of a pause here. a focus on earnings at the financial companies. >> did some comments by alcoa about end markets take you by surprise? >> no. alcoa is one of those unique situations. if you want to read it as something positive, you can. if you want to read it something that's a one off, you also can.

. >> we had kevin ferry on that day, it was october 1st, on air, gary kaminsky is saying -- so we maybe go back. >> we'll have to i said forfind. >> we just had this conversation about ge. it's ge -- maybe not aaa anymore, but it's ge. yielding 3.5%. they'll raise the differ denied probably. ten years at 2%. the whole market's at 11 or 12 or 13 times earnings. there's some specter that is keeping the general public away from this earning more on their money, seems leak kind of a no-brainer. so something that already has people his taesitant to get int this. >> i think what it is is a memory. the memory of the last few years, they're saying the probability of that left tail event that really scares me makes me want to not do equities. i agree, it's in the price. >> yeah. >> and then on monday, talk about a man -- >> what has just happened here? >> i don't know. i said a bone, not a boner. why are you walking off the set? >> talk about a man who has no problem saying it as he sees it, republican congressman ron paul is going to be our guest host on monday. the gold standard as to whether

. >>> gary kaminsky looking at how in this case tech bubbles start, gary.pers, putting $1,000. granted, multi year price target, but nonetheless on apple. >> as background here, i have to say, it's been a very interesting week. you know, i've been involved with cnbc. and i have to tell you, in the last week, the fact that there was some for apple the e-mail, the lakewood would have remembered having endured this and maybe back in the late 90s. the point here is that it is a worrisome time when you start to see analysts over analyst starting to get in front of each other, trying to take price targets up. i'm not saying -- we're not trying to make apples to apples comparisons because, yes, i know the multiples are nothing like they were in '99. i don't have an opinion on apple. in fact, the only opinion i had was back in the early part of january. remember, i came on air. i said when it traded down, every portfolio manager who wanted to own the stock, get in on the stock was going to take that opportunity to buy it. my opinion is not on the stock, but my opin

gary kaminsky joins us once again on set. good to have you back.he performance of the market, versus the performance of mutual funds. >> again, carl, we look at the relative performance of mutual funds and try to do it every month because it is such a great historical indicator of what are managers trying to do in the sense of putting money into the market or taking money out. we get the data as always from tom lee at jpmorgan. here's the main number. only 7% of active managers when you look at all mutual funds are missing the index by 500 basis points. take a look at the percentage that are essentially outperforming. at least beating the market. 24% of all funds will be in the market by at least 250 basis points. 12%, at least 500 basis points. as you remember, if you go back to last fall, when the numbers were so skewed the other way, in some cases you had 70% of active managers trailing the indexes, it was a great indicator of more money, closet indexes chasing performance, once again, after the first quarter, active managing stock picking way a

first, though, get to our capital markets and gary kaminsky who i know wants to talk about a bunch ofll, big show today. rex ryan has a lot of answering to me as a life-long jets fan. let's talk about chesapeake first. you mentioned the reuters story. graham reported by reuters earlier today. the fact is, we discussed this six months ago called chesapeake is not an energy company. it has not been an energy company for many, many years. in the opinion of many institutional investors, this is a hedge fund. it has been a hedge fund. they create a lot of cash flow by selling out of the money calls. it was a good strategy when the price of the commodity came down. this has been a controversial name for many, many years. this is all i want to say. and it is my opinion. take a look at this board of directors. i'm now going to say, given the news that was reported today, this has got to be the worst board of directors in the united states in terms of corporate governance. the fact that this information is coming out and it is coming out the way it is coming out and that this has been a patter

gary kaminsky. ebay of course reporting quarterly earnings wednesday after the bell.e-commerce company cited growth in its market place and in pay pahl, raised its forecast for the year. is now the time to unload that watch or piece of jewelry on ebay? john donaho is the company ceo and we'll be joined by our tech correspondent john ford in a moment. congratulations on the quarter and good to have you with us. >> thank you very much. great to be here. >> looking at some of the metrics whether active users, margins, was there any area of the business that you found disappointing at all? >> no. it was a good quarter and it was a quarter where all parts of our company were firing on all cylinders. >> obviously ebay has been known for, in some ways, lagging the growth of e-commerce and especially amazon for a while. do you think this is the end of that chapter and the beginning of a new chapter where in fact you out perform? >> well, here's what, carl, mobile technologies is fundamentally altering the retail landscape and ebay and pay pal are right at the forefront of mob