kkr is out with its outlook. bonds and cash among other significant calls. henry mcveigh is the head of global and asset management at kkr and joins us now for a cnbc exclusive. good to see you. >> thanks for having me. >> before we get to your ideas for 2013 we all know private equity is looking at dell. is kkr involved in this dell deal? >> i can't comment on that. >> what about the whole m & a story in 2013? is there reason to believe that we will see more private equity money going into some deals? >> yes. i think one of the things we highlight in the piece, the second half of last year, what we saw were earnings really coming down, expectations being ratcheted down at the same time the stock prices were going up. that's not a great equilibrium for mna activity and os. my view good forward is you'll have a better become damn we've been trying to use the volatility to our advantage and 2011 put a lot of money to work when it was very unsettled. last year we were not as active and this year us a look towards th

. >> indeed. >> caller: my question is about kkr. two ticker symbols. >> no, kfn -- get the one -- >> buy, buy, buy! >> you want the one with frank nancy, no the the other one. kfn, that is the one. i'm sticking with it. kevin in illinois. kevin? >> caller: jim, boo-yah to ya from out chicago way. thank you for all you've done for us little guys. my stock is verizon. steady dividend payer, but the whole class seems to be dragging. >> yes, it is, because people want more excitement. they want global growth. verizon is strictly domestic. i'm going to tell you to hold verizon, not to buy it. it comes lower, we'll use it as a dividend play. it doesn't have that kind of growth. john in virginia. john? >> caller: jim, the wizard of wall street. >> thank you. >> caller: i'm a second-time caller. and to those who post negative comments about your picks and advice, i say that you are correct a lot more of the time than the analysts that people pay -- >> well, thank you. let's go to work. what do you got? >> caller: i'm looking for a couple of

kkr. let's go to joe in michigan. joe?. >> beautiful. >> trinity industries. am i right about the stock or should i just let it go? >> making railway cars including oil tankers. let's go to bill in oklahoma. bill? >> caller: boo-yah, jimmy. >> boo-yah. what's up? >> caller: got ahc, 37 and change. are they going to keep running in the mid-40s? >> i like it here. how low oil prices are here in this country versus getting it from brent. let's go to jeff in nebraska. >> caller: boo-yah, jim. >> boo-yah. >> caller: i got a question on ironwood pharmaceuticals. just hit a 52-week high. >> i don't know currently what's going on with ironwood. i will have to pass on that one. let's go to marvin in california. >> caller: boo-yah from san diego, california. >> nice. what's up? >> caller: jim, i'm currently liquidating some assets and i'm turning my portfolio into gmc. >> i like gnc very much. it's doing really well. i want to own that stock. let's go to dave in florida. dave? >> caller: how are you? >> real good. how are you? >> ca

gerri: brian, this was a report from kkr about the total cost of stimulus spending; right?t was unbelievable. unbelievable. something like $7 trillion. $7 trillion. what do we have to show for that? unemployment the same level it was when the president took office. we have a gdp report, the economy didn't expand in the last quarter, but strength by the tenth of a percent. consumer confidence is not up; it's down. looking at the details, you come away thinking, wow, all the money out the door, and what do we have to show for it? >> right. we have been forecasting and expecting and seeing what we call a plow horse economy. it's not a racehorse. it apt going to win the kentucky derby. it's a plow horse. it moves hade. our average growth in three years has been 2% a year. which, by the way, equals the last four decades average growth in france or germany. this is a -- we are already france. we have 2% up employment. gerri: we are already france. we don't have a 75% tax rate for people making a million bucks or more; right? >> that's right. the key reason we are growing so slowl

my partner and i spent 20 years at kkr and that was a great business. out there and growing and what we do is invest behind good management stakes. >> that's stuff that's not publicly traded? >> that's right. >> so do you have advice for viewers without that option? >> i think. sure. in the public markets we take a long-term view and do deep fundamental analysis and we wait, and it's okay to be in cash while you're waiting for a good opportunity that may come along. >> you're not worried about new regulations, you for example some of the taxation industries that are plaguing some industries right now. all the headwinds people raise the issue and have reason to be concerned. we have two banks. no one is in the country that thinks banks aren't regulated but we think if you give capital to those kind of entities even in a regulated industry, you can do quite well. >> decathlon coming up, the fifth year you would be doing it? >> yes. the rbc decathlon, all the competitive men and women from wall street, compete in athletic endeavo endeavors. their friends b

kkr up 9%. blackstone up 7%. ebay. you picked it last week. up 2%. nice record. pressure is on now. >> well it's been an up market. obviously kind of going with the flow a little bit. i feel like if you wanted to capture any potential sudden pull back because of the over optimism or anything like that there is an etf, the s&p, high beta stocks. sphb. which essentially is the 100 stocks that give you the most exaggerated move in whatever the market direction is. i don't think this is a long-term play but strictly a scalping operation or a hedge if you are already pretty long here that would essentially be giving back some of the out performance. sbhb is up 8 plus percent in three weeks versus 5 1/2 on the market. a lot of out performance in a relatively short period of time after options expiration. i don't know what the implications are. seems if you had any give back that is where the juice is. >> we shall see. fast and slow money watching as we know. we'll see how it shakes out next week. good to see you. have a great weekend. let's go to the market flash desk

there was a kkr report last we week, $7.7 trillion worth of stimulus.ost off of our chart listing this program, fannie freddie bailout, operation twist, go down the line $7.7 trillion. if you total it up compared to last year's gdp almost 50%. if you're a small business owner, you are not opposed to that figure because you think it is finally having some impact. cheryl: we definitely see that from our consumers. jeff: sh she was a c. c. o. a dn of united health care. you have been the corporate side most of your life and now look at this economy through the eyes of a small business owner. cooking classes, we see them in progress back there. give me a sense of the economy from your perspective. >> we see a little bit of optimism. we see people going through expanding in their homes so they need new things for the kitchen, more entertaining. jeff: does today's gdp number match what you are seeing? >> no, the production does not match what we are seeing. i see a large increase in holiday spending and even january. jeff: small business owners tend to be opt

people are worried about a change in the tax code, that didn't happen, so we think blackstone and kkren it comes to tangible books? you look at how wells fargo is viewed, yet tangible book is still relatively high. what is reasonable at this point? >> that's a great question. obviously ties heavily to the return on ecity. there's a strong correlation to where something trades and where it should trade. our view is that wells fargo at one seven times book is not that cheap, but something like goldman sachs at one point was outrageously cheep, and wells fargo frankly is a little too popular for us, everybody likes it and that tends to make us shy away. >> that is true. you make the point that interest rates will not be at zero forever and it's got from 169 to 1.9. have we -- is that trend truly reversible? will we being going higher? >> it's hard to predict the ten-year rate, but absolutely long term, but frankly the short-term rate is very important to these fusions. somebody like a morgan stanley or us custody banks. something like morgan stanley can charge their customers for the mon

companies like blackstone or kkr. a huge name in private equity. economic recovery. >> let's walk through some media companies. we work for a media company so i'm happy to see you're interested in something in this world. but, i don't think you're necessarily recommending comcast right this second. you like cbs. >> cbs has done a wonderful job over the last several years. les moonves, a very powerful ceo, very effective ceo. really made a big difference there. they've got great programming. great shows. great content. and at the same time, benefiting by the fact that people are continuing to advertise on television. >> and you think that holds up when nbc prime-time really kicks into gear? come on. >> yeah, yeah, i'd give some kind of spread. >> it's still the best way to get a mass audience. it really is. >> newspapers. i hear you got a newspaper company you like. that, you know, i love that. >> the net has been one of our favorites for a number of years. it's done very well since the bottom of the market in 2009. >> does it hold up? >> it's held