of course, coming off a fresh 13-year high yesterday, kel. >> no problems still raising capital. borrowing at rates -- with a rating, i should say, stronger than u.s. government. >> one to keep an eye on. of course, jcp, as dom pointed out before we signed the piece of plexiglas. we'll see you on "closing bell." >> yes, we will. let's get back to headquarters and scott wapner and the "halftime." >> thanks, guys, so much. to the core. what does apple's deal with china mobile and battle with carl icahn mean for the stock's recent breakout? power broker. citi's sunni harper is here live on where the best bang for your buck really is right now. we do begin with rates to rally and the reason why stocks can still go higher. more signs today of an improving economy sending the 10-year closer to 2.9%. the move coming after a nice drop in jobless claims and an upward revision of gdp. so stocks are trying to battle back from that four-straight down days. so our question to the traders becomes this -- if rates are rising for the right reasons, isn't that good for your money?

it is "halftime," and let's play the action. josh brown, if rates are rising for the right reasons, isn't that good? >> i think it is good, and historically, stocks are positively correlated with rates, so long as they're rising gradually. there are areas of the market that you probably want to avoid, however. utilities spring to mind. but then, there are areas that benefit, such as financials, as you've no doubt heard at this point. that's why the banks have begun to break out this fall. i would look at this as a positive, so long as rates are going up for the right reasons and not the wrong reasons, and so long as they don't go up too quickly and too drastic a fashion, which so far so good. >> doc, can we just move away from the question -- are rising rates going to kill the rally and turn it to why rising rates won't kill the rally? can we start to have that conversation? >> we can. i agree with josh 100%, which is rare. no, i'm just kidding, josh. i do agree with him. when we saw the big jump from 1.6 to 3, yeah, that was a scary jump. now that we've basically stabilized in, let's say, 2.75

to 3 range, for the 10-year, i think that's positive. do i think we'll probably be about 3.1 by the end of january? yes, i do. but if we go there gradually, if we do it, steven liesman, for instance, in little, tiny baby steps, which is what i think we'll do, i think that's very positive for the market. because i will take real economic performance. i think that trumps anything the fed can do. >> you gave our secret away, steve liesman is on set. >> that was a secret? >> i have a metric for that. >> what's that? >> give me a dollar for growth, i'll trade you 10 bucks of qe in a day. >> okay. >> that's my metric. >> isn't that the conversation that we really should be having -- >> absolutely. >> -- from now forward? why the market can handle rising rates, the rates are rising for the right reasons? >> that gets into the debate, is it the flow of the stock, the excess liquidity out there that's pumping up the market?

the unemployment number will be key for a couple of reasons. i think the fed wants to know what the real unemployment rate is, because i think it's throwing out the october data that had that 700,000 decline in the workforce, was it shutdown-related? so it will look at that number to get a feel for, hey, where are we? the other thing that it's going to look for, and this is the trick, watch how the two-year reacts. i want to show you the 10-year versus the 2-year. and this is a new metric for the fed here. i think it's been talking about this. the thing the fed cares about hasn't convinced the market that tapering is not tightening. and the way to look at that is to look at good data and watch how the two-year reacts. why the two-year? because the two-year is about the length of the promise that the fed has remained -- has said it will remain at zero. so what you see right there is essentially a steepening curve. the 10-year either remains high or goes up with good economic data. but the two-year stays down as

the market remains convinced that the fed will remain at zero on rates. >> steve, what -- >> so watch that spread tomor w tomorrow, because if the fed sees that number going the wrong way, or that spread not steepening or flattening, then effectively it's going to take some action to convince markets more so. >> can we just simplify this? >> it's not simple. >> wait, wait. do you think the economy is better today than it was when bernanke spoke in may? >> i do. >> okay. >> i do. >> so you look at today -- >> it was better in may, it got worse -- >> and now it's picked up. >> complicated that -- >> well, no, the point of it,the ism number was the most important number this week. i think the gdp is backward-looking and we all knew inventories got boosted higher. >> but the forward is going to be less -- >> the new orders in the ism, the employment number in the ism -- the production in the -- >> i'm a huge ism fan. it hasn't done a great job. it's been very strong, but it hasn't done -- >> so my point is, i think the economy is a little better on better footing. >> it is better.

>> and they can up thatter, and because we have more confidence in the underlying fundamentals of the economy. >> what will give the fed pause, or do something like cut excess reserves or provide more language on its metrics of 6.5% unemployment is if the two-year starts to move. i'm just telling you that that's the thing that they care about right now, that the market believes in what scott's talking about, which is that tapering is not tightening, and it will keep pushing that -- whatever tools it needs to convince the market, it's staying at zero, even when rates -- even when the economy -- >> steve, as much as i agree with you, and with josh and john, as well, you know, one thing i think we're missing here is that the market is at a very high level right now. by the market, i mean the stock market. the u.s. treasury market has probably adjusted for a first quarter start to tapering. but this stock market should be down more than it is today. and the reason it's not, in my opinion, is because so many money managers are trailing their indiess going into the close of the year, going into the homestretch, they throw money, it's a hail mary in the

end of the fourth quart other, w money -- >> high relative to what? to future expected earnings? relative to past earnings? >> relative to future expected earnings, but future expected earnings, the multiple of which should come down as tapering starts. >> the economy is better. but the economy is better. >> and the economy is better. i agree with you on that. >> you're not taking my trade? you're not taking my trade. >> i'm taking your trade -- >> 10 bucks of qe you give me a dollar a growth. >> and i'll throw one more angle at that. >> you finance it and give me a year, and i'm with it. >> why is profitability the only thing that matters? what if we actually get global economic growth as qe is tapering off. what if we get sales growth? remember that? what if not everything was about buybacks and dividends, but actually people got excited about wages going up, better employment. >> from your lips to god's ears. >> i'm not saying it's in the bag. i'm saying that it is a possibility. it shouldn't be completely ruled out when you have every central

bank on earth throwing as many dollars as they can into the system, don't be shocked if wages tick up and if people start to spend more money. it's entirely possible. >> steve, we'll be watching closely tomorrow morning. we'll see what happens, especially on the heels of the spread, the adp report, which was better than a lot of people were expecting. so we'll watch the spread there. thanks. i know we'll talk to you again tomorrow. steve liesman. so the right way to trade all of this on the back of the backward-looking but better-than-expected gdp, better-than-expected jobless claims, better-than-expected adp, and now what is the most important jobs report in a long time. >> the steepening yield curve, right, we've talked about the financials. i totally disagree with the downgrade from the deutsche bank that says the steepening of the yield curve is bad for banks. it's good for banks. it's good for growth and loan growth. industrials, also, very positive, as the yield curve steepens, because it implies that better gdp. and, also, economic growth, and

josh just said, what if we get the global markets to start to participate and see a little better growth, and it could take off in terms of the earnings front. >> the next guest overseas citigroup north american sales trading in business or origination of premium securities, and also voted one of the 25 most powerful women in finance by american banker this year. sunni harper is live right here on set. it's good to see you. welcome to the "halftime report." >> thank you very much. >> where are we in the market here? are we in a bubble? >> we're not in a bubble. in fact, the rally is sustainable for a lot of the things you guys were talking about. the equity market has priced in the taper much so than the bond market. the bond market is expecting 10% for january, 15% for february. equities seem to be well ahead of that and priced this in, and i i think we have a way to run. >> are you worried about rising rates, or have we been there, done that? we've had our fit and we can accept what the punishment will be? >> i think the market has bifurcated. there is tapering.

that has been digested. they are, to your point, focused on the economic data and why we're going to go up. that's good for the economy, good for stocks in general, specifically as you say not the utilities, the high-dividend stocks, but the bank financials, insurance company type stocks. >> are you convinced that as money comes out of fixed income, that it is finding a home in the equity market? i think there's a great debate about the great rotation. >> yeah, i'm not sure the great rotation exists. most of the people have thought of it historically to the credit markets, equity markets, similar rate driven, and inflows and credit markets are up year to date. not up as much as equities are, certainly. we're seeing some of it come out of municipals, some come out of commodities, some come out of government bonds, certainly. but it's not a massive shift. those markets are slightly down year on year in terms of the flows, so it's more of a deceleration. we think the equity market's coming up with cash. >> you like the u.s. better than everywhere else? at this point in time? >> elhh, no, i probably like european equities better than

u.s. equities, but that's a close race. we like european equities better than u.k., because we think the same curve play is going to happen over there, right, the ecb is going to cut more slowly than we'll see out of the bank of england, so that should be a bolster for the european markets. >> you're not worried about the recent data in france, turning down and also germany -- >> we like germany. there's still a lot to play out there. i think we're kind of past the u.k. a lot of the growth we've seen. so kind of focusing more on europe being a slower trajectory. >> europe has had a good run, right? a good bounce-back. who's to think that that can continue? there still seems to be a lot of risk over in the euro zone, much more risk than we're feeling here at home. >> yeah, i think that's right. the technical play, an interesting one, we've watched a lot of investors come out of equity, particularly in the credit, corporate bond market. they're flooding back. we're watching investors hire people on the ground after shrinking the businesses. so i think, again, a ton of pent-up demand in europe, and they can't wait to get back in. >> if you put more money to work right here, right now, how would

you do it? >> right now, for 2014? >> that's what i mean. >> as you sit here today. >> yeah. municipal bonds, a controversial call, i'm sure. it's had a difficult year in munys, three years in 20, negative returns in the municipal market. i think a lot of is overblown because of the headline risk. i think detroit, puerto rico, jefferson county, get a lot of play, but historically we've seen a big bounce-back after a market like that in municipals. again, we like the equity markets everywhere, shy in emerging markets. it will take a while for the markets to recover, i say 2015 for that one. not that bullish on commodities for the year. and credit's probably going to be plus 4%, 5%, staying in the high yield, more weedy -- weighty markets in the credit sector. >> if the s&p right now is selling for a 15 multiple on what we think next year's earnings might be, is that expensive? is it cheap? does it have room to move up without more earnings growth than the 8% that's now being bandied about? where do you stand on that? >> i don't think so.

we're looking at a 7%, 8%. we're consistent with eps growth in the equity market. we had been in the 12%, 15% camp, but a lot of that's played out in the fourth quarter. >> we've pulled forward some growth? >> absolutely. >> so the multiple probably doesn't have much room to expand, and we might have to live with -- >> i don't think so. again, i'll go back to the technical play. we have $9 trillion in household cash. i think a lot of it needs to be put to work. a lot of the funds are sitting on 8%, 9%, so there's more of a technical play in equities, people haven't gotten in yet, ahead of january, a very telling month. >> how long will it take for the market to accept the question that we asked at the top of the show -- as long as rates are rising for the right reason, isn't that a good thing? it seems as though it has to be pounded home and pounded home and pounded home, because the people just don't want to believe that rising rates can actually be good in this environment. >> i think 2014 is going to be a stock picker's market, and i think it will play out in some stocks and not others. so again, i think the market's

gotten okay with taper. it's not an if, but a when. the delay made people more comfortable with it, so i think we're almost there. >> suni, great to see you. >> thank you. ford is unveiling a new mustang, but the buzz is about ceo mulally. will he stay or will he go? our phil lebeau asked him pointblank, and we'll get that answer next. and if he goes, could he land at microsoft? that really is the big question. even though it's one of the dow's top performers this year, someone here says not even alan mulally could save it. so we have a microsoft debate straight ahead. apple is getting a boost on a report it's inked a deal with china mobile, but the company is getting another push from carl icahn. how should you play it? that and much more straight ahead. [ bagpipes and drums playing over ] [ music transitions to rock ]

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welcome back to the "halftime" show. we have breaking news regarding twitter. and julia boorstin has that from l.a. julia? >> it's yet again another post-ipo step from twitter to show investors it has big plans to make more money. it's launching new targeted ads that seem to be a game changer for how advertisers target consumers and convince them to spend. twitter shares up about 4% right now. just moments ago, the company announced it's rolling out a new advertising tool that targets users based on what websites they've visited. this particular type of formatting is valuable, because it helps them reach consumers who have expressed a particular

interest in making a purchase. if you say visit tripadvisor, you could get tweets with relevant travel deals. this makes twitter more competitive with facebook, which has similar ad-targeting technology, called fbx. one of twitter's partner companies for the new technology called ad role, works with facebook's fbx, says it will enhance twitter's ad revenue, perhaps most importantly, the technology targets consumers with the more effective ads on their mobile devices, which is the fastest-growing ad category. scott, back over to you. >> julia, thanks. josh brown, the race to 50 bucks. twitter against facebook. 48, 45. >> yeah, 46 is probably the big hurdle, because i think that was the high of the ipo day. i would be shocked to see huge money piling into this stock. in the mid to high 40s. i think in the absence of news elsewhere, people are, you know, catching onto this, and it's obviously exciting. i think the future is bright for twitter. but as i've mentioned a few times, i would really prefer to see them report a quarter before

i would get all balled up on the valuation. >> a good bounce, the stock was under 40 the other day. >> yeah, i'm long. i'm not complaining. i don't know if this is the race to 50 officially beginning just yet. >> doc, you're in weekly options. >> i'm in the weekly options, judge. i'm not in the stock at all. monday, they bought the 42 calls that expire tomorrow for 40 k t cents. they've traded to $3.60. that's 900%. i don't know where else you can get anything like that, not even bitcoin do you get things like this, judge. that's why these weeklies are so popular. but they bought a lot of them early in the week, and to josh's point, there's a lot of believers out there. let's talk about ford. the company may have unveiled a new mustang this morning, but the only thing anyone carries about is whether ceo mulally will stick around or bolt to microsoft. phil spoke with him earlier today. it's clear he would rather be talking about the horsepower under the hood. [ laughter ] and he's now forced to address the elephant in the room --

microsoft. >> reporter: you have to feel bad for the guy. he has these great marketing lines he's been practicing over and over, and the first thing he'll be talking about is staying at ford for the next year, the next year and a half? we asked him pointblank whether or not he's been approached by microsoft board members or by representatives for microsoft about taking the microsoft ceo job. here's what he had to say. >> i am honored to serve ford, and we have no change in my plan. >> reporter: i understand that. but you didn't answer my question. have you been approached? >> i did answer your question. i am honored to serve ford, and there's no change in our plan, and we don't comment on speculation. >> reporter: and that's become his other standard line -- he will not make any further comment, other than to say -- other than to say he is happy and planning to stay at ford. and it's important to keep that in mind, as you take a look at shares of ford over the last, what, six years, how long he's been there, since october 2006. the stock is up more than 100%. but let's point this out.

he has not said categorically that he is not interested in the microsoft job. and the other thing to keep in mind, as you take a look at shares of microsoft trading lower today, a lot of people are saying, well, he said he'll be at ford. he's planning to stay at ford. he is free to go whenever. if he chooses to retire next month, he can retire with the blessing of the board. if he chooses to take a microsoft job, if he's offered that job at some point in the future, he is free to go. so i think that's the important thing to keep in mind, here. >> and also, phil, maybe you have board members starting to let their opinions be known publicly or otherwise that -- >> reporter: right. >> -- they expect him to be there, and, thus, microsoft shares are down, you know, 4% today at the lows of the day. >> reporter: absolutely. and i think there is a frustration from some within ford that alan doesn't come out and say, i'm not interested in microsoft. the fact he hasn't said that, that speaks volumes. >> yeah, no doubt. phil, great stuff. thank you so much.

>> reporter: you bet. >> phil lebeau and the mustang. sticking with microsoft, shares hovering at 13-year highs and quietly one of the top performers in the dow. what if mr. mulally does not get the job? what's the trade on microsoft's future? dr. j is the bull. >> all right. i love this stock, as i said, and i continue to love the stock. they've got 12 different businesses, judge, that do over $1 billion in sales. it's just sick. everything from sequel to office and so forth. and the xbox one is a fabulous platform that's a multimedia platform, obviously, gets you hooked up to netflix, espn, cnbc, all of this stuff, i think, makes microsoft a very dangerous company against the competition. cloud and all the rest, these are all reasons to be long this stock. plus, it broke through at $37. it's held that level here today, even on the sell-off when people don't think mulally will take the job. holds 37, judge. i think it trades into the

mid-40s very quickly. >> jim, you're up. >> well, doc, i think this has been a great year for microsoft, and it's a great company. this is obviously a question of what happens to the share price going forward. and you're right, they do have a lot of business lines, but here's the rub on microsoft. it's got one business line that matters, and that's the windows platform. let's face it, there will never be in any industry a franchise like windows again. they have mastered the art of global penetration, and unfortunately, saturated the market with it. i agree that xbox is terrific. i think the nokia deal could be something that matters. but the problem is, they all pale by comparison to windows, and there's just no growth there. the problem with it at the high 30s here, is i see you get the 3% dividend, i don't see you get much more than that. it's a value trap from here. >> let me ask you this, does it matter that much if mulally doesn't get the job? does he matter that much to the company's future one way or another? >> no. and that's not to rip alan mulally.

i love him. he's done a fabulous job at ford. he's an unknown -- >> this isn't about mulally. it's about microsoft. does it matter if he runs that company or not? >> -- what he would do at microsoft. some of the fluff coming out of the stock here, judge, it holding, in the midst of the biggest dip ever that they've seen in p.c. sales, this stock is growing. it's not shrinking, it's growing and revenue going up 16% year over year. i think it's just a monster. i don't think you fade it. >> well, i'm going to say this. this is not a one-man show. it's not about allan mulally. it's a big, big company. >> it's funny, the problem as the the company, they try to make it about steve ballmer. >> and it isn't. that's oversimplifying a very, very complex situation. the then i worry about with alan mulally is here's a guy with a phenomenal track record, right? what he did at boeing commercial airplanes was terrific. what he's done with ford is heroic. i worry he might try to go for the trifecta and get himself into a mix he can't fix. it's not a one-man show. >> tell us who you think won.

tweet us @halftimereport, using #bull or #bear. our resident stock swami seeing activity in his crystal ball that could cause a big move in two stocks. we'll take a look. where will apple go next? it's been in breakout mode, about you how will more pressure from carl icahn impact the stock? all of the traders have an opinion, as you well know, and we'll get those plays and much more coming up on "the half." [ bagpipes and drums playing over ]

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before trusts were created for their grandkids' educations... they chose a partner to help manage their wealth... one whose insights, solutions, and approach have been relied on for over 200 years. that's the value of trusted connections. that's u.s. trust. welcome back to the "halftime report." yesterday, a lot of the stremt traits for reits were up big after a potential deal for excess to buy pre. reits are on the move again today, but on the downside. it's a big mortgage reit play, and they're in focus, after analysts at goldman sachs initiated coverage with a sell

rating. they expect book values to fall as interest rates rise after the fed pulls back on stimulus, the taper. remember, the reits have been income substitution plays as overall rates have been kept artificially low, scott, of course, by the fed. >> yeah, no doubt, dom. thanks. jim, all reits are not created equal. >> right, definitely. >> but these mortgage reits seem to come under pressure anytime rates start to rise significantly. >> right. let me stress the first point, because mortgage reit is not the same thing as a vernado or general growth property. these are things where you need a definite opinion on not just where interest rates in general are going to go, but where different points on the curve are going to go relative to each other. we were talking at the beginning of the segment how there will be a ton of volatility coming up over the next year in interest rates, and you have to have a very strong opinion to treat these stocks correctly. i really -- i have some experience with this, and this is not for the faint of heart.

>> alny under some pressure. dr. j is seeing unusual activity in a telecom name, and we want to find out what that is. >> sure, judge. at&t. just out of the money calls, the december 35 calls, the stock was roughly 34.40, or so, buying the calls, so a slight upside bet. they traded 36,000 of them very fast early this morning. open interest was less than half of that, so in other words we believe an awful lot of this is opening new trades, bought on the offer. that's bullish. >> all right. a look at the stock of at&t, down .3%. gold is down 20 bucks today. giving back all of yesterday's gains. let's find out more from jackie deangelis in the "futures now" desk. hey, jackie. >> good afternoon, scott. the big news for gold, of course, could come tomorrow when we get that all-important jobs report. all eyes on that. brian, we want to go to you. how much are you expecting gold to move off of that number, and in which direction? >> yeah, jackie, it's a big number tomorrow, really. i'm expecting the unemployment rate to come in at 7.2%, if not 7.1%. if we see that, that could move

gold $25 to $50 lower here and push it below $2,500. now, the macro economic picture sets up with a $1,250 price target, but if we get a lower unemployment rate, then gold will be under pressure, because taper talk comes back on the table. that means gold goes lower, jackie. >> jim, that's one point of view. curious what you think. would you rather be long or short going into this jobs number? >> i'd rather be short. you look at the chart, no secrets. the trend is lower, and the fundamental story remains that they don't like talk of taper. with the strength in the numbers we've had this week and the strength we expect tomorrow, which i believe is what's going to happen, the fundamentals story doesn't change. it still doesn't pay to be long gold. i think 1,200, brian mentioned that level, will be an interesting and significant level. that's my first target. if it goes below that, we could be talking about something more serious. >> all right. on this one we agree. we'll have more on gold in the online show, and log onto this one, because we have a bull/bear debate of epic proportions today. jerry segal and byron wien,

debating the outlook for next year. the bull battling the bear. futuresnow.cnbc.com, and get to it from the cnbc home page. >> jackie, a great one. can't wait to see that one. top of the hour. don't miss that. segal against wien. all right. lots of buzz around apple today, but wire cutting to the core of the company and finding out where the stock could go next and how to play it. plus, how about a look at tomorrow's jobs numbers today? we'll talk to a guest with some unusual insight into how the report could actually shake out. ♪ [ cows moo ] [ sizzling ]

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we are back on the "halftime" show. apple is trading at its highest level since last december, on reports the company has scored its long awaited china mobile deal, and also the new salvo from activist investor carl

icahn. so, brian marshall follows the iphone for isi, and has a strong buy on the stock. brian, nice to see you again. >> thanks, scott. >> china mobile first. what does it mean in terms of additional revenues and in terms of additional iphones? >> sure. it's a very big deal. if you look at it, apple currently has 280 carriers on the planet. that group collectively has 4 billion wireless subscribers. if you add china mobile to the mix, that, you know, obviously, almost 800 million wireless subs. so that automatically increases the footprint of apple's carriers by 20%. now, we'll have to see what kind of marketing and subsidies the two parties will come to terms on. but at the end of the day, you know, this could add 10%, 15% accretion to the numbers next year. we're at $45 of earnings, and calendar '14, this could add $5 if it's a successful ramp from both parties. >> we shouldn't be surprised, though, about this. right? >> no. >> we expected this to happen. i wonder whether any of this is already in the stock? >> yeah, i think -- you know,

there clearly is some of this -- basically, this deal's been rumored for years, so if it comes through, comes to fruition on december 18th, finally, yeah, i think there will be a relief rally once we get this. we've seen a lot of head-fakes, especially over the last couple of months, but at the end of the day, if we get the two partnered up and they're offering the phone at an appropriate level to the consumers, then this could be powerful for accretion going forward. >> you have a $600 price target? >> yes. >> is that in jeopardy of being raised any moment, given what the stock's done? it's had this breakout. >> sure. when you look at it, i think there could be opportunities for earnings going forward to migrate higher. i think the market right now is willing to pay a little more, so i think we've seen some multiple expansion on the name, as well. so you take the two factors in, and there's a possibility that, you know, things could look different going forward. but as we stand today, we still have a $600 target and a strong

buy. >> all right. we'll have to keep watching the isi paper flow to see when the new note comes out, that's what that sounds like. let me ask you about the icahn thing. >> yes. >> adding a little more pressure to tim cook to do, you know, this additional buyback. and i'm wondering whether you think he now has put tim cook in a bit of a box? it was easy before for tim cook to look at an additional $150 billion and think that, you know, my god, that's massive, we're just not going to do that. now, at $50 billion, is there any reason why apple should not do that? >> i think carl makes valid points. clearly, apple has way too much cash. it's an underutilized asset, just wasting away, buying back stock is a good use of cash in our opinion. i think dividend is a good use of cash, as well. so ultimately, you know, we think apple's all about growth. they want to grow the top line, they want to grow the bottom line, grow the franchise and grow the dividend and the buyback. we've seen that in the past. i think we'll see that going forward. i think they'll do that on their

own terms. i don't think anybody, no matter how vocal they are, powerful in the industry, will dictate what they're going to do, but they're open to suggestions and, you know, carl has had tim over for dinner a few times, and it sounds like they're buddies. we'll have to see what happens going forward. i fully expect the buybacks and the dividends to increase at apple going forward. >> do you think by lowering the amount that he wants done now, or this year, that it puts a little more pressure on them to do something, whether they want to be dictated to or not? right? i mean, it's easier to sell 50 than 150, is it not? >> yeah, it clearly puts more pressure on, but i don't think they'll bend to it, personally. we'll have to see what happens from a vote standpoint. but the company has so much cash, almost $150 net cash per share. they have a lot of flexibility. so if they wanted to get in and do more, they certainly could on both fronts. last quarter alone in september, they bought back $5 billion of

stock. they almost did $3 billion of dividends, so that's almost, you know, $10 billion on a quarterly basis going back to the company, annualize that, that's basically what they're doing with cash flow. $40 billion a year. so they still have this massive cash hoard on the balance sheets, so clearly flexibility to do more. i think it's going to be unlikely for them to change their opinion based upon the opinions of one person. >> they say they're going to address it, what, early next year. >> yeah. >> brian, we'll see what they do. thank you so much. brian marshall isi. let's trade it. >> i've been long the stock. i think the beauty of the situation is icahn really doesn't have to get anything accomplished on the proxy side. the stock is already making him money. we saw that with netflix. he didn't have much of an impact there, but one of the biggest winners ever. the other thing is, if they do a percatory vote, that's nonbinding on the company, and it may be a hint, you should do more, if icahn does that. but he's happy as long as the stock is, i know i certainly am. instead of focusing on the proxy

stuff, it's more interesting to think about, it's way below market marketable. quite frankly backing out the cash, a multiple under ten, there's no reason why you don't want to be long this name, if you're long any tech. >> the window, so to speak, on a buyback, you know, closes a little bit as rates continue to rise. it's not as cheap to borrow money and do a bigger buyback. >> yeah. >> right? >> well, i think apple is not really hurting in that department in terms of wherewithal. they've already done a big financing, and if they really, really wanted to, they could repatriate some cash and pay taxes. that's probably not what's going to happen. >> no, they're not going to do that. >> the stock on its own merit will do fine. >> just focus on the product, and the margins are stabilizing, and those are more important, i think, in the near term. >> here's a question. how would you like a look at tomorrow's jobs numbers today? up next, we're talking to someone who get as very unique perspective from background checks. that and much more is just ahead.

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irrational exuberance now. can you trust the jobs data? cnbc investigates the real stoi before on the government's employment report. scott scottie, i'm channelling my inner jack welch right now. >> all right. sue, thank you very much. -- shirrland released a note that he says he thinks ford ceo alan mulally is likely to be the next ceo of microsoft. rick, that really is the topic of conversation right now regarding microsoft today, especially given his interview with mr. phil lebeau, where he told phil, you know, he's proud to serve. he didn't really answer the question phil was asking directly. why do you think that mr. mulally is going to be the pick, because the market seems to be voting today that he is not. >> look, i think that spoke volumes when phil said, well, excuse me, but you didn't answer the question. and alan mulally said, we don't comment on rumors and speculation. if he weren't interested, if he weren't in discussions, he could

do what some others have said, which is, "i'm not going." and he won't say that. it's like, "i'm happy serving ford." well, okay, yeah, that's fine, what about answering the question? are you going to microsoft? and to that, he responds, we don't comment on rumors and speculation. and then, later you had this comment from edsall ford, who frankly has said that mulally has told him that his plan is to stay with ford until the end of 2014. well, that's been the case, you know? that's his plan, so his plan changes -- >> rick, hang on one second. could i please see shares of microsoft, guys, hit now, please? the stock was down about 4%, rick, when the markets seemed to be voting that mr. mulally was not going to go by virtue of what he told phil. looks like it's coming off that level based on what you're saying. i mean, i don't know, you know, on a percentage scale, what do

you think the real likelihood is that mulally is the choice here? >> i think it's more likely than not that over the next month mulally will be announced as the new ceo of microsoft. and if it's not mulally, you've got several other external candidates who are very, very qualified to take that spot. so all i've heard today is his plan has not changed, and that's all that you should be hearing today, is his plan hasn't changed. well, you know, his plan doesn't change until he gets the job offer, and then his plan changes and everything changes. so these are not comments that he's not going. these are comments that his plan is to stay at ford through the end of 2014, until his plan changes. so i think the street's got it wrong. >> is mulally going to make that much difference at microsoft? >> yeah, yeah, i think there's an opportunity to have a fresh perspective on a lot of things here. so he can't do it by himself. he can pull a couple of quick leavers to get earnings up

dramatically. we've identified three things you can do pretty quickly to get earnings up another $1 a share and get the stock to 50 bucks. you gotta fix the business, too, though. and that's going to be harder to do. a so, he'll need a lot of help from product-oriented people, because that's not his background. he's a super smart guy. he's able, at boeing, to get the 777 off the ground on schedule. that's extremely complex project. he's done a terrific job at ford. so he needs to complement himself with good product strategy people. i think those people exist within microsoft, you have to reorient them, focused on areas growing faster. they have a lot of growth opportunity. if you pull the levers and get them up, potentially an extra dollar, and margins go down in the meantime, people would be okay with that. >> the stock's the third-best performer this year, rick, as i know you know. how much wind comes out if mulally is not the guy?

>> oh, it'd probably be down, if it's one or the other external candidates that i think are likely on that short list, they're all up in any case for either of the four external candidates. it would go down if it's one of the internal candidates, as much as 10%, 15%. but i think that's highly unlikely that it would be any of the internal candidates. >> all right. hey, rick, we appreciate you calling in. it's an interesting sno ining n. it's one of the topics of conversation today. we appreciate it very much. >> thanks. >> what if you could know the tomorrow's job numbers today? and one of the things is a background check. sterling is the second largest company in the country that does that. billy greenblight says his work gives him a unique insight on what investors can expect tomorrow. welcome. good to have you here. >> good to be here. >> to be clear, companies extend an offer to somebody, and then they do a background check with a company like yours. >> that's absolutely correct. >> do you have a unique perspective into what's going on in the jobs market. >> we're in the pre-employment

screening business. so somebody has to apply for a job, get background check before they get the job. so generally, if not a day to ten days ahead of the cycle. >> so given what we got this week, right, adp better than expected, more than 200k. jobless claims down more than expected today. the $64,000 question, and there's a lot more money perhaps riding on it than that, is what happens tomorrow? >> well, i'm a believer that we're well above consensus. so our november numbers, and we compare them month to month, week to week, actually hour to hour, they were 10.1% over the october numbers. we haven't seen that kind of growth month to month since june 2007. so if i'm going to give you a range, i'm going to tell you 210 to 230. >> 210 to 230 is what you're expecting -- >> is that small business or are you predominantly serving larger corporations, and, also, where does government fit in? because that's been the big drag

this year, state and eck loal has gotten better but federal has been tough. >> it's everything on the business side, the private sector. >> no government, okay. >> there's municipality work, but not federal government. we're not a federal government contractor. >> okay. >> we represent 20%, 25% of the fortune 500. and then we have we have thousa thousands of small businesses. we represent over 20,000 companies. >> would you say it's pretty well spread out trks this growth you're seeing? >> it's pretty spread out. everybody needs help right now. >> let me ask you this. i would assume if somebody's going for a background check, they're not going to work a cash register at a fast food restaurant. you're an indicator of higher quality jobs. >> no. >> explain this to me. >> whether you're a cashier, temp staffing, hospital, you know, an academic institution, manufacturing, we do work all across the spectrum. >> okay. >> small business and low-paid jobs go for background checks. >> plus 210 to plus 230 is the range. we're going to hold you to that.

>> you can. >> we'll see what happens after the fact. joining us here from sterling infosys tells, the founder and. ec. coming up, someone here told you to sell a name that's up 10% since then. does she stick with her call? that and much more is just ahead.

let's get to the center of the action with the floor traders at the cme, the nymex and ubs. first up, doug rothchild. what are traders watching for at the cme today? >> obviously the entire market is focused on the unemployment number. we're looking at the fix of what those numbers might be, particularly in the municipal bond market, which is driven by outflows -- excuse me, inflows last year, we saw about $43 billion which were inflows followed by record prices. and then this year in june, bernanke's taper talk led to 27 straight weeks of outflows and $50 billion overall of outflows in the municipal bond markets as the retail market, which is 75% of what drives that market. >> right. >> really forced those prices down. so two things happen this week that we're watching very closely. detroit was approved by a federal court to move into bankruptcy, no surprise.

what is a surprise and what we're all watching is how they're going to treat the pension plans because the federal court suggested that those pensioners might take a haircut. and that's a precedent that's going to have big effects in the muni market. and the second place would be illinois which passed reform this week, long overdue politically, they had to do something. they've done nothing. but it's not enough economically if we want to avoid being a detroit in ten years. >> okay. doug, thank you. allen harry at the nymex, what are you watching? >> natural gas very intensely right now. we got a draw on natural gas that was a surprise to the market. because of it, we went up. we also broke a very key resistance level, 402. once we broke that, i started getting long. i'm long between 402 and 407. i'm a buyer when it dips. i think we get up to the 426 to 431 level. also winter is starting, cold weather coming is going to make us go even higher in natural gas if we get very, very cold weather.

>> thank you very much. paul richards, i'm looking at the euro at 136. what are you looking at? >> the fact that the market got a little ahead of itself today. this is the same market that one month ago, 90% of people thought the ecb would never move. today they thought they'd be more dovish. it's still a step up here. 138 is not going to break between now and year end. it's going back down. >> thanks very much. we'll talk to all of you again seen. final trades and the result of our debate up next on "the half." before global opportunities were part of their investment strategy... before they funded scholarships to the schools that gave them scholarships... before they planned for their parents' future needs and their son's future... they chose a partner to help manage their wealth,

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all right. the people have spoken. we've counted all the results. dr. j, you did win the debate. >> jim did a great job, though. i just like the stock. >> give us a final trade, josh. >> i like ford.

i don't know what happens with mulally, but i think the stock works higher. >> it's up 100% since he's run that company. >> hertz, htz, like it, a lot of unusual call activity. >> jim. >> cliff's natural resources, iron ore producer. >> i like chesapeake. >> that's all for us. we'll see you tomorrow. "power" starts now. >> "halftime" is over. "power lunch" and the second half of the trading day start right now. >> it sure does. thank you, scotty. paying dividends. as the ten-year ticks ever higher, we're looking at the highest paying dividend stocks to see how they measure up and how they'll hold up in 2014. is the jobs number wrong? our steve liesman and eamon javers have been doing fantastic reporting to find out if the labor department has been giving us essentially bad data. and fast food restaurants across the country are facing some very stiff protests today. demonstrators want the minimum wage to jump to 15 bucks an hour. what would it mean