joining us now, meredith whitney, she is the founder and ceo of the meredith whitney advisory group.out on the health of the u.s. consumer. you say that consumer spending has been very strong and is likely to continue throughout the course of the year. but you say there are some real portions of strain. you want to lay that out for us, what you're seeing? >> what you've seen over the last several years has been the high end consumer, the high-income consumer has dominated more of the spending, the total spending and that's up 10% in last few years. so over 54% of total spending is done by the high-end. and they're moving along. they're the wunones that benefi from the low rate environment, they benefit from the stock market resurgence. but the other folks, you have to have assets to benefit from low rates, the folks that are compromised are the middle class, that have been debanked and cut out of the credit system. so $2 trillion in tread it lines have been cut since the peak of the credit crisis. and if you don't have credit it's a big adjustment factor in terms of getting used to a

here are your headlines for february twenty second two thousand and twelve well known analyst meredith whitney says the middle class is being de banked in her view with the by product of banking regulations. some of this was good but the unintended consequences is it's really squeezing the middle end and i think that you're going to see more and more people live outside the system and when that. meanwhile are the big banks getting around the key piece of regulation meant to shut them out of the business of posing as this demick risk to the entire economy by speculating with customer money with your money with the protection of you the taxpayer will speak to members of occupy that as the seed to break down the holes in the already under attack volcker rule also in the e.u. even though bailout is a naughty word according to an official they too have not created a system to deal with a failing bank with out one and i mean a bailout reuters reports the e.u. is struggling to get new financial rules on the books why is the transatlantic banking monster so hard to lay meanwhile greece is racing to me

i saw meredith whitney she's obviously a very well known analyst she was talking about how regulation has gone too far in the other direction in the sense that we're regulating too much now the middle class is getting squeezed out of the banking system as an unintended consequence is that the problem or is that that regulations are written in a way that benefits the big guys at the expense of the small guys or new entrants that want to get in to thinking of this or the financial sector. so i think that the big banks are really really good at this thing that we call regulatory arbitrage and the idea of that is essentially you have a team of lawyers who have a team of structures they read the rule they read the law and they figure out how do i abide by the rule but get around the intent of the rule and wall street is really good at that and because wall street has so much money they have the firepower and the numbers in order to do that and i think the reason that maybe maybe what meredith whitney is referring to is that smaller and smaller companies don't have armies of lawyers and arm

here are your headlines for february twenty second two thousand and twelve well known analyst meredith whitney says the middle class.

i mean, consider this morning when i watched meredith whitney on "squawk box." whitney, if you aren't aware, called the bottom in the municipal bond market, but not in the way you want to call. she shouted from the rafter, rooftops, that there will be a huge slew of municipal defaults and scared hundreds of thousands of people into selling bonds. the impa the exact opposite happened. she created the greatest municipal bond buying opportunity of our life. she said you ain't seen nothing yet. at one point you have to see you ain't seen nothing yet, because there is nothing to seem the answer for permanent bears seems to be never. the safest answer i can give you is the whitney answer, the market is being incredibly stupid and we can't feel the impact yet. that would be easy for me and i get to wear the 12-gallon hat i'm going to have to get. i'm stuck with the reality. and the reality is if gasoline is killing us, the absolute wrong stocks go higher right now. make nike breaking out. $150 sneakers? i have $500 who would fay $500 for the engineer mijeremy lin s? do

sees robust eps growth and meredith whitney raised the price target up to $410 saying the european weakness hasn't been showing up yet. so people still like mastercard. there's a look at the stock and the run its had. year to date up 5%. but doubling the dividend, you don't see that often, a company coming out and doubling their dividend up to 30 cents a share is what mastercard does today. >> i can't remember the last time a company actually doubled down on the dividend. >> it's a big move relatively speaking. >>> martha stewart, a household name, fournd ander and director martha stewart omni media. deals with jcpenney, home depot, macy's, petsmart and now she's adding staples. we talked to her this morning about her deal with avery dennison and staples and what the market is. take a listen. >> home organizing is a $21 billion business in the united states. there are 20 million home-based businesses in the united states and 17 million of those are operated by women. so we thought that this was probably a pretty safe area in which to design product. >> one would think so with those numbers.

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. >> i think it was, meredith whitney.e possible negative consequences, the reason for keeping it there if you are not keeping the positives out of it, there's no reason with the possible negative consequences to keep it down there. i guess, would you argue that if the stock market goes up maybe even if people don't get into the mortgage market, you're getting a positive effect from the loose money, or would it be better to start maybe to take the foot off the gas before 2014? >> well, i'm going to talk today -- i'm in a conference here in new york today and i'm commenting on a paper on housing. it's a good paper, so once it's released, i encourage have been to read it. the notion in the paper is that there's some -- some households are constrained and some households are not constrained by the collateral in their house. the ones that aren't constrained can react to the monetary policy in the usual way, and the evidence in the paper says they have. and the people that are constrained, they can't react. no matter what you d