didn't match up to zappos.m the vault we have brian rooney's profile of zappos from july 7th, 2008. >> reporter: if you're looking for a certain pair of shoes, there's a warehouse in kentucky that probably has them. they've got a thousand brands in just about every style, size and color. four million pairs of shoes. 24 hours a day they're boxing them up and shipping them out to shoe shoppers sitting in the comfort of home. >> good morning. thank you for calling zappos.com. >> reporter: this is zappos.com. what amazon did for books, zappos is doing for shoes. they're trying to revolutionize how business is done and how people work. the name is an adaptation of the spanish word for shoe and this year, nine years after going into business, zappos is on track to sell a billion dollars worth of shoes. >> you will have these shoes on monday with our free upgrade. >> reporter: and they're having a party doing it. one night it was a toga party. work hard, play hard. >> are you ready to have a good time? >> yeah! >> rep

zappos has done that. >> are we taking too much to?here is zappos going to fit in compared to the kendle. >> it may be in a few years. zappos is bigger right now. selling 650,000 of them now in a run rate basis. average price at $350. doing less revenue from kendle than zappos. >> is the price in, the stock has had a tremendous run. jim, what have you heard from analysts, even today, from numbers? >> is this more of a sign to come in the technology world? >> really good question. amazon is up 67% so far this year. the company's second quarter, what they'll be reporting today is typically slowest. i don't think we're looking for blockbuster news here. they did beat handedly last quarter ebay's numbers yesterday suggested amazon could do it again today. it's all going to come down to margins. m and a, there is so much cash on the balance sheet right now. when you see the dow up 200 points today and the nasdaq up 40 or 50. you wonder if the m and a strategies of the companies are passing us by as this rally begins to gain traction on the

this is a big deal because it was just a couple months ago you might remember that zappos released a statement saying the company was going to begin expanding and in a significant way its online retailing opportunities and options for its consumers. the thinking then was that zappos was on pace to become a serious amazon competitor and basically laid down the law, saying amazon, look out, we are lurking and we are on the way and we are ready to test you and challenge you and it's just a couple of short months later that amazon turns around and says there's no threat here, we're just going to go ahead and buy it. $807 million and amazon will also be providing $40 million in stock and stock equivalents to zappos's employees, the management team and the employees will stay intact at zapp. so at the company's las vegas headquarters. and it looks like amazon is expanding itself in a big way. earnings tomorrow. >> nice to have that kind of wiggle room. jim goldman. up next a "first on cnbc" interview with senate banking committee ranking member richard shelby. he'll tell us if he's in favo

. >> amazon bought zappos. holy cow. that's zappos. it gets the uggs there.bay reported a monster good quarter. i've bought the heck out of it for my charitable trust. i see skype getting better and margins better and i see the gross market value of all goods actually going down less. i think you got horse sense, but why? why would i ever limit it to ebay when i like ebay and i like amazon? i like them both. it's a twofer. bill in new jersey. my home state. bill. >> caller: how are you? >> not bad. how about you? >> caller: i'm doing good. a local jersey boo-yah. >> going to the shore this weekend. boo-yah. >> caller: got a question for you. with all the fraud these days and money transfers online by western union, i'm curious what you think about verisign and does it tie into your popular view of the smart phone and notebook explosion? >> i'm not a big fan of verisign. it's a played out story. it reminds me of the out dot com days. i would welcome the company coming on air and telling me why i am wrong and giving me a better idea about how that business is d

amazon bought zappos. that's very good.appos numbers though heavily inflated by my daughter's buying in the last six months. holy cow. that zappos. now here's the thing. e-bay reported a monster good quarter. i've been buying the heck out of it for my charitable trust. i see gross margin, gross market, a value of all goods actually going down less. inc. you got horse sense but why, why would i ever limit it to e-bay when i like e-bay and i like amazon? i like them both. it's a two fer. bill in new jersey, my home state. bill? >> caller: how are you, jim? >> not bad, bill. how about you? >> caller: i'm doing good. local jersey boo-ya. >> going to the shore this week and boo-ya. >> caller: got a question for you. with all the internet fraud these days in money transfers online like western union i'm curious what you think of just passing the $1 billion check for daymark and does it tie into your popular view of the smart phone and notebook explosion? >> i am not a big sign of verisign. i feel it's a played out story and remin

. >> pau and tomorrow amaz reports results and tay it bought onle zappos for $850 million. what'sour take on tha deal. >> amazon has increed the number of products t their site d it will me an interestg addition especially if weee consumer incomes rise. >> paul: any oer particular names you like now and why in the tech sector? >> certainly, are we spect to tech names, crisco we think is well positioned and we see them asattractivelyval you'd wit smart ones and resrch in motion opposed to ale or palm provides a bter risk tradeoff for inveors. ? cs the symbol onasdaq and go ahead, david. >> yes, and then last but not least we tnk yahoo as we start to see a display recoving in the second half of the year looks attractive andith regard to yahoohey may have a trans, with microsoft. >> pau do you own any of the stocks weentioned here? >> certainly. we own microsoft as well as crisco in personally and in our portfoli. >> paul: thankou for sharing ur insights, avid. thank you, paul. >>aul: my guest david jarrity of dva research. >> suzanne: tomorrow, rd c.e.o. alan muly joins us wi

said they'll introde in the marke >> paul:nd tomorrow amazon reports results and tod it bought onlin zappos for $850 million. what's yr take on that deal. >> amazon has increas the number of products to their site anit will mak an interestin addition especially if we s nsumer incomes rise. >> paul: any oth particular names you like now and whyn the tech ector? >> certainly, e we spect to tech names, crisco we think is well pitioned and we see them as atactively va you'd with smart phon and researc in motion posed to apple or palm provides a bette risk radeoff for investor ? csco t symbol on nasq and g ahead, david. >> yes, and then last but not least we think yahoo as we start to see a display recoverinin thsecond half of the year looks attractive and witregard to yahoo the m have a trs, with microsoft. >> paul: dyou own any of the stocks we menoned here? certainly. own microsoft as well a crisco in personally a in our portfoos. >> paul: tha you for sharing your insights, david. >> thank you, pau paul: my guest david jarrity of dva research. >> suzanne: tomorrowford c.e.o. alan laly joins u

and then amazon, given their latest purchase of zappos, do you buy, sell or hold the stock?ck to you, melissa. >> up next, julia boorstin at the foreign brainstorm conference with a first on cnbc interview. >> the economic downturn is proving an opportunity for a lot of the tech companies here at fortune brainstorm. i'll be talking to the c eos of one of the companies, coming up, only on "the call." >>> heavy hitters in the business world are gathering at the fortune brainstorm tech conference in pass deana, california. and julia boorstin joins us live from there with a special guest. hello, julia. >> hi, larry, i'm joined by john chen. john, thank you so much for joining us. >> thank you. >> earler this week you posted better than expected earnings results, higher revenue from licensing and also higher operating margins. and you also raised your full year guidance for the second time this year. what is driving cybase's growth? >> a few things. we're doing very well in mobility. and i think that's a big driver. we have some traditional database business that did well, especi

in addition to shoes, zappos sells apparel and accessories. the two companies will continue to be run separately. >>> the obama administration has formally sent its financial overhaul bill to congress. the proposal would make the federal reserve the financial system's top cop. and increase supervision and regulation for the nation's largest banks. fed chairman ben bernanke told a senate panel that he opposes part of the plan that would create a consumer protection agency. >>> general motors says it is seeing signs the ailing auto industry is beginning to recover. gm's second-quarter sales fell 15% below a year ago. but were up 20% from the first three months of this year. the automaker says government stimulus plans around the world are expected to generate millions in sales. >>> well, chrysler is hoping to get some extra mileage out of the government's cash for clunkers program. the automaker will match the $4,500 incentive for trading in old cars. and customers won't even have to trade in an old car or qualify for the federal deal to be elig

from amazon and zappos-- to bristol-myers squibb and medarex-- mergers and acquisitions seem to be breaking out all over wall street. thomas burnett of wall street access says that's a sign of a change in outlook >> corporate board rooms are beginning to see that we're through the worst of the overall economic recession and that going forward it looks like we can envision growth. it may not be this quarter, next quarter or early in 2010, but going forward we're through the worst and things are going to start to get better. >> reporter: but if confidence is returning, it's cautionary at best. the value of the deals year to date is only 35% of end of july last year. rich peterson of s&p says if you are looking for a return to a trillion-bucks-a-year m&a pace, don't hold your breath. >> that's not to say there's a buyer's strike. there's deals that are going on. but in terms of the large mega- deals that we saw back in 2006, 2007, in the hey-day of private equity, those are not on the horizon any time near. >> reporter: one reason current deals are relatively small is that private equity money

pressure because of the zappo's and i also believe they are the virtual mall. first of all, i didn't think it was bad and, second, i don't think necessarily there has to be pin action and when you're in a bull market you don't get anything other than glancing blows like this, and it is a bull market >> yeah. it's different because maybe people aren't as exposed to equities. >> look. a lot of people -- hear people come on all day and today was a very interesting day from what i heard people. a lot of people today who were very bearish, who came on today and acted as if they weren't bearish or said, you know what, it's a really good market. i call these people who have no value added and when i hear -- i didn't call them stupid. i'm not going with the stupid thing. nobody on my lawn though except for like four guys cutting it today because it looked really bad after all the rain. here's the way i touch base on this particular market. what i say to people is that there are many people who are looking at the nasdaq up 20% and they are up 10% and there are investors

now they have zappos. there are rumors they want net flix. i think we'll see this continue. >> it looks like this is a stock deal. if you're amazon and trading at 40 times earnings i bet they didn't pay 40 times earnings for zappos. that makes me think probably not going to move the needle sideways but do you think they'll continue doing these deals when they have this currency that's so valuable? >> i think they will. they've always wanted to be the big presence on the net and they have such cost advantage over regular retailers with the bricks and mortar. they want to get bigger and have the opportunity now while everyone else is really suffering and they don't have the capital. you know, when you've got the money and opportunity you've got to take it. these guys are really smart. i would expect we'll see more of this. if they were to pick up net flix right now trading at 30 times, once again, still creative even though the stock is expensive. >> when you talk about amazon heading into earnings, clearly, they are looking to become the walma

zappos also sells apparel and accessories and offers free shipping on all orders. >>> the obama administrationmally sent its financial overhaul bill to congress. the proposal would make the federal reserve the financial system's top cop and increase supervision for the nation's largest banks. fed chairman ben bernanke told a senate panel wednesday he opposes part of the administration dominplan that would create a consumer protection agency. he says those powers should stay with the fed. >>> positive signs for the auto industry despite its sixth straight decline in global sales. gm's sales fell compared to a year go but up 23% for the first three months of the year. the automaker says stimulus plans around the world are promising to help sell millions of vehicles. >>> the automaker matching the cash for clunkers program which offers up to $4,500 in incentives. even customers that don't qualify for the federal deal or trade in an old car will still be eligible for the rebates. >>> coming up on "good morning america" -- mortgage nightmares. businesses that help you to promise keep your home but

>> zappos, doesn't sell cowboy boots, but they are a proven online retailer. they're being being bought by amazon. this is a terrific model. this changes e-tailing forever. amazon frs cut out the middle man, now they're cutting out everybody. their margins go through the like. terry: apple zonl had disappointing sales this week. >> but the way they're changing this, they're going to look for more acquisitions. and you can buy and sell it yourself. terry: especially with their high-priced stock. and wayne, you're the last up. >> well, i think j.b.l. is on to something in the long run. i don't think so in the short run. no, my pick, is i'm concerned about the recovery here in the united states, so i'm going overeast. i like central european distributing corporation. they have the largest distributor of vodka in poland. terry: got to leave it there. thanks, wayne. that's

you mentioned the amazon and zappos deal. they closed for wind river systems at $840 million there. oracle bought sun microsystems and earlier there was cisco and pure digital. there has been lots of talk that netflix is a take over candidate by microsoft or amazon with several analyst reports fueling that rumor mill. it stands to reason shares have enjoyed a renaissance. they're depress friday a year ago and with many companies sitting on enormous cash positions and apple over $30 billion and microsoft, google is $19 billion and means plenty of money and affordable companies. that means this kind of thing might be just beginning. >> you stay there and with nearly 88 cents of every dollar going to tech or digital media, the hot button question is do mergingers happen where the government is not involved. bringing in frank a quilla from m&a group where he advised on am jen, boeing, anheuser bush, general mills. let me start with the second question. are we seeing deals that don't involve government stimulus money? >> not really. i think the stimulus moan may be helping the economy to

netflix would be a much bigger purchase than zappos but that might have been the reason there was such a buzz, scott, about netflix was that there was something going on clearly. that deal was done with zap po's. i would say the video game companies are going to be also in focus because many of them have had significant drop-offs. they don't have a lot of new titles coming out just yet. as these new titles are coming out, that's when the focus will be back on those guys. i'd look to buy those on the cheap. just like amazon said, the big purchases of video games were not happening in the quarter. that's bad for the gamemakers and bad for game stop. but could be good for an investor who's smart and willing to be patient. >> i think what was i read a couple days ago that the npd group was out with a report on video game sales last month or the last quarter being down by a record amount. if you don't have new titles and as we saw referenced today by a consumer confidence number which was weak, if consumers aren't willing to spend money it's sort of a double dose of bad news for that partic

. >> amazon just got zappo. ebay has plenty of cash on its balance sheet. you accumulate more cash in your balance sheet. do you see ebay making any acquisitions? >> we've made two billion-dollar acquisitions in the last six months. we're using the balance sheet strength to get stronger. we bought bill me later in the fall, which is a great transactional billing business. and then we bought t-market, which is the leader e-marketplace business in korea. >> anything else you're looking at right now? >> you know, we'll keep our eyes open and where we see opportunities that will strengthen or core e-commerce business or our payments business, we won't be shy. >> great. unfortunately, we have to leave it there. we look forward to hearing more about what you have in the works. >> great, julia. thank you. >> thanks, julia. john donahoe, the ceo of ebay. >> you know, the thing about ebay and amazon, they both put up good quarters. the reason that ebay's response was so much better was that ebay was trading at 13, 14 times and amazon was at 41 times. so you really n

they did the zappos deal recently. they bought a shoe manufacturer. and they were what, a penny above expectations. the stock has just done so well and the expectations are so high when they come in and do a little bit better it doesn't surprise me that the stock is selling off in the news you that just mentioned. >> let me get to jim gold here. gentlemen, stand by. want to come back to you shortly. want to get to jim goldman now because he's got more detail on the amazon quarter. 32 cents a share on revenue of 4.65 billion. jim, what can you tell us? >> yeah, this is a nice beat for the company. but that top line is coming in a little lighter than anticipated and that's going to raise some eyebrows. but let's go a little deeper in it report. operating income definitely came in lighter than anticipated. $159 million is going to be disappointing to some on wall street. you look at north american revenue up 13%. you know, the street was looking for something on the order of 17%, even 18%. international revenue growth 16%. the street again looking for so

zappos will get a boost from amazon. and it was nice to see a couple of deals happen against the misted of the marking action. >> zappos is just shoes and -- >> zappatos. >> i'm surprised you knew that one. i know more spanish than you did. >> do you know what. [ speaking foreign language snshgs snshgs means? >> shut up. >> lemon is lemon. >> you get a corona with a lemon, yeah. [ speaking foreign language ]. >> welcome -- >> that's mine. >> woke to telecome. >>> the nikkei is up this morning. oil is relatively steady. a lot of the inventory numbers we've gotten out this we'll week have been relatively neutral. we're down 15 cents. that is the september contract. ten-year note, we'll keep a close eye out. the do recall action, we've seen some sdeents moves in the euro/yen cross. and gold, especially with bernanke talking about interest rates remaining low, $954.30 is the last check on gold. christine tan is in singapore standing by overseas and first let's go to london looking splend yid in orange, here is louisa bojesen

we think using ticketmastery's platform, our concert platform, we can become the zappos or amazon of concert business compare to where we are today. >> thank you for joining us. i appreciate it. erin back over to you. >>> next, your preview of intel's quarterly results. talking about those being the key read of the day after the close. >> that's coming up this afternoon. but first, go trish! >> now it's really getting fun nichlt great to see you. coming up at the top of the hour, we have a great show planned. for sarah palin writing a op-ed criticizing the president's cap? we're going to discuss and debate this one. >>> plus, june retail sales stronger than expected. but you know what, the back to school season, that's a critical i critical time for retailers, is looking pretty weak.. what does this mean for you? right now, we're going to discuss. and we have a first on cnbc interview, we're going to be talking with marcie sims. lots ahead only on wee"the call" but first mark and erin are back right after this break.  >>> technology bellwether, inte8 after the close today, it's g

zappos sells should you, hand bag zs, watches and other accessories.any has a fiercely loyal customer base because zap poes is know for its customer service, free shipping and free return policy. i know lots of people that are very, very happy with that company. >> yeah, hard not to buy four or five at a time, reet? >> right. >> thank, have a great day. >>> we're finding jobs for you now. the wdc medical training center is looking for a dialysis cord nature tore. candidate shoes have ten years of dialysis and five years nursing experience. go to nbcwashington.com and search jobs for you for more information. >>> a check of the forecast once again with tom. >> it's front porch weather. good weather for hanging out on the front porch. the air is rather humid this morning. but not too uncomfortable. the temperatures are in the comfort zone. now 73 in washington. we've got that summer hayes over the jefferson memorial. there's washington skyline in the distance. ud've got some low gray cs lo chauds anging over the potomac rer d as we take a look at radar,

amazon and zappos. >> this is a $35 stock so -- yeah, that was -- for ibm you would have to call it smallhat probably includes debt if it's $1.2 billion because they're not doubling the price and it was at $35 so must be debt included swu. >>> back to our cnbc exclusive, former new york city mayor rudy giuliani, our guest host for a couple of hours. are you seeing any signs in new york that the economy is stabilizing at all? >> yeah, i think so. i'm not sure we're through it though, yet. i mean, i think the financial community has come back somewhat. i mean, the market is a good indication of what's going to happen in new york city. you have a good market year, new york city is in pretty good shape. all those bonuses that everybody attacks is the way mayor bloomberg will end up balancing his budget or not. the mayor has to predict the revenue receipts, has to set them. the heavy part of it was, what kind of bonuses was wall street paying out because all that money gets paid out. you talk about a stimulus -- >> don't profits get taxed, too? >> of course they get taxed. they get taxed incon