tv Street Signs CNBC May 5, 2014 2:00pm-3:01pm EDT
>> interesting comments about a rising potential of a dramatically falling treasury rate. >> that's right. >> i would say that's fascinate. >> el he called the bottom on it the last time. nice to have you in the house. >> thank you. it won't last long. that will do it for this edition. >> "street signs" begins now, we'll see you tomorrow. \s. hello, everybody. happy monday, i'm mandy drury. >> and on the other side of the scale, the economy. yes, russia, ukraine is a big issue, but today we have another better than expected data point, this follows last week's strong jobs number. >> back atcha.
>> the big question is -- what is more important to your money? in fact both of these market moving headlines, michelle, always ladies first here on stinz stinz. by the way, welcome back. >> thank you. we've learned that the u.s. government official. is leaving tomorrow for par sis, london and berlin to try to increase coordination with our european allies against the russians in case there are greater efforts to prevent them from holding the big elections on may 25th. there is this perception there's a big gap between what europe is willing to do and what the united states is willing to do, but a senior treasury officials sell they don't think there's that big of a gap at all. on reports of german industries being against further sanctions, dave cohen, the senior treasury officials who was going to europe, or according to his senior treasury officials, will
not be meeting with german industry groups. all of this comes as we see eastern ukraine and southern ukraine increasingly under a lack of control. kiev had to send in a new specially created special forces unit into odessa in order to try to take control of the city. then the police literally caught on tape, giving up, putting down their shields and kiev completely losing control of the southern city, not just an eastern city. there you can see the unrest. there's a report out friday about victory day, which could be incredibly violent, according to some reports. >> steve liesman is here. he's going to take the other side of the stock trade, but before we get to that, i understand you might have some breaking news? >> and only at cnbc with the segue from ukraine violence to the senior survey, because it all goes into the pot, but the
survey is out, the measure of credit standards and the demand at the leading banks, and according to the survey, banks also reported higher demand for those sorts of loans. that's a good sign. they also eased standards when it came to the consumer for credit card and auto loans, but they tightened standards for subprime mortgage loans. overall the basics are say mortgage demand is declining in all categories. meanwhile, a key service sector, 55.2 figure beating expectations of 54.1 by a full point. you can see the best figure since august. it's a clear strengthening trend since the wind. we also looked after the strong jobs report, nine forecasts from wall street economists, you can see they have upped their forecast with 3.8, and there is now, guys, a pretty sizable 4% club.
some of the well-known guys. joe la vonnia was in that club for quite a while, he didn't change, but ubs up to 4.6, up 9 -- 0.9 percentage points. hfe also up a big number right there. so here's the thing. debate is this. was it a one-time pop in the second quarter from bouncing back, or are we at a new higher level of growth. >> i have a new questioner. great his. nothing to do with why you're supposed to be sitting here. we're supposed to fight about the economy versus ukraine. do you have anything to say about that at all, sir? >> there is no fight. >> okay. that's the point of the segment. >> you didn't get the memo? >> i did. i thought it was directly on point. >> why? >> because most of what we see so far suggests that whatever
happens in ukraine will have little impact or blowback on the u.s., except from an uncertainty standpoint. much more concerned about china. >> what if there were to be a very huge increase in the level of sanctions that we impose on russia when it comes to financials or banks sanctions? that's where i think you start to. >> i think that's right. >> in the words of one treasury official, any anxiousing will be ones that are necessarily painful to the europe and the united states, because they're sew -- >> which may be why it never happens. because we're not talking -- we both know, the only sanctions that wore are the ones you have against iran and north korea. they basically cut them off from the dollar economy. you cannot cut the fifth largest economy off from the world or the dollar economy. >> we could. the u.s. could do it unilaterally, but would we? >> okay. so here's what i'm hearing from both you smart folks. we can't go to war, because we
have no more appetite for it, and we don't know who we're fighting at this point. nor can we impose sanctions on the fifth largest economy in the world. >> not meaningful ones. >> so we're powerless? >> yeah, but for what purpose. i don't hear this debatal all, michelle. what is the right role? what is going to become of ukraine that we can actually expect to be -- to realistically happen? ukraine will always be inside russia's orbit, so long as russia remains a strong country. >> the core principle is that you shouldn't destroy another country's scorch territory, right? >> that's the principle. >> unfortunately weft to cut it there. i want to go, dom, what's going on? you have a market flash for you? >> absolutely. what you are seeing or what you will see in a couple of moments is ira sohn, this is the sohn conference in new york city, getting ready to take the stage is larry robbins.
he's going to present his trade ideas, just like so many before him have so far today. we heard mike talk about brazil, jeffrey gundlach about the housing market. and laffont, talking about liberty global is his best trade idea. right now larry robbins is taking the stage. he will present his idea. we are not going to have this live here, but what you want to go is go to cnbc.com. we will carry the entirety of this speech from larry robbins and his trade ideas. so go to cnbc.com to catch this presentation in its entirety. we're, of course, looking for those stocks, those trade ideas. we'll bring you those as they become available. back over to you. >> thank you, dominic. in the meantime, let's get back to our original debate. you have things that could potentially be capping gains in stocks like eye crane and the other. good economic data finally coming out of the u.s. economy. what is more important to your
money? joining us is andre gassi, a global market strategist and cnbc contributor and chief global strat gist dan green which way will those scales tip? >> i think medium term and long term, what's happening in russia is not going to affect the u.s. economy and u.s. markets. in fact we've done a lot of work on this, michael semblance, recently wrote on this topic, since 1950, aside from 1973 middle eastern conflict, in the median term, military conflict have not affected the markets. medium or long term. so sure, there might be some volatility in the short term, but we don't expect it to derail what we are currently seeing. >> steve, are you still there? >> still here. thank you, buddy. >> we'll get to dan greenhouse in just a sect. the jobs number was viewed good when it came out and people dug in says labor force stinks, they sort of pooh-poohed it.
ism today reasonably good. in your esteemed estimation, honestly, because the today data is good on the surface, how strong is the u.s. economy right now? >> i think it's well worth a conversation. i can't say for sure, but there's a decent conversation we're picking up from the 2.25% 'name ecgrowth we've had. it could be more like a 3% growth for a period of time here that may last through this year. that is more by subextraction than it is by addition in the following way. a lot of the stuff that held us bass look like -- we're adding by subtracting. that is a good way to mix music, if you haven't heard. >> dan greenhouse, which do you think is the more important? the economic data that seems to be springing back or what happens happening in the ukraine? maybe both are good. if you see it as a buys opportunity. >> yeah, i think andre has it
exactly right, in the sense that going back 30, 40, 50 years, unless you get a significant spike in oil prices or some sort of interference on the trade side of things, the effect of these types of global conflicts tend to be relatively short-lived. from an investment standpoint, i don't think anybody's concerned about the medium to longer term. the issue, of course, is we all don't live in that. we live in the immediate and short term. this was supposed to be over some time ago. this could obviously get way worse. but at that point, it becomes unquestionably a buying opportunity. >> you think, just to follow up on the conversation that michelle and steve were having, do you think ha harsher sanctions, whether or not they may come down the road, could harsher sanctioning be something that might hurt the u.s. economy? >> well, listen, i'm not a geopolitical strategist, and i don't know exactly. it's hard to comment on hypotheticals, so to speak. i hate to sound like a politics, but generally speaking, i think
steve is exactly right, and with respect to the conversation you just had about the underlying strength of the economy, i don't think there's any question at all -- i don't think there's any question at all that the u.s. economy was much, much better in march and april than in january and february. >> do you agree with that? >> i think the economy is getting stronger. i don't think we have to look at just april and may on its own,o, because i think there is in give-back, if you will. we'll have to wait really for cleaner data in the third quarter to see where we stand, but we believe the u.s. economy, will be closer to 3% growth than 2% growth. >> the next question is if stocks are simply the future value of earnings are stocks then undervalued, or has this improvement already been priced in, and this is what we got? >> there's two drivers for the market. one is valuation and the other is earnings growth. i think it's get closer to fair
value, but earnings grut we think will continue to be maybe 6%, 7%, 8% if the economy is accelerating and that's what will carry the markets. >> thank you, gentlemen, for your thoughts. stocks ultimately go higher for one reason when there are more aggressive buyers than sellers. with stocks near record highs el we know there have been buyers. who are they? and what are they buys? td ameritrade out with its -- welcome, by the way. >> nice to be here. who's buying and what are they buys? >> we created this index. are retail investors getting more bullish or bearish? it's an important question in the whole dynamic in. in april what we found is retail investors slightly decreased their exposure to the markets, but it's interesting, because they were net buyers overall,
but they were rotating into lower beta stocks. >> you know what i think is interesting, when i was reading the results of this survey, of course they're declining for the first time and i think that's a good thing. if you see bullish readings among mom-and-pop investors, that kind of worried me, because wow, we're getting excited, record highs, i'm going to pile more money in, so maybe it's a good thing they want to step back a bit. >> i think you're absolutely right. that's why we created this index. there's always been a notion that's existed out there that the retail investor is the dumb money. what this index shows is that they've been participating every step of the way in this rally, and here we are at seven consecutive months of increased exposure, they took it down a bit. they're being a little carb. >> because, with all due respect, mandy, but i don't understand your hatred of mom and pop, first off. for "street signs", i apologize
for you, only one of us hate you. >> i don't classify that as hatred. i'm looking out for them. i'm so encouraged by the fact they're not being overly bullish. i don't want to get burned again. >> that's true. >> a year ago and two years ago we had mom and pop are getting in, the market must be peaked out. they have played it pretty smart this time. >> because mom and pop are smart, thanks to tools like td ameritrade and -- >> get down! >> it's also interesting when you break it down to individual stocks. there have been net buys the technology, the names that were decimated in the mo-mo breakdowns. >> the big stock that they got in april behind was facebook, also twitter, which didn't work out quite as well. facebook looks great today, but also yahoo and google.
they were log technology and services. >> but selling apple. >> net sellers of apple. there was a tremendous dialogue going on with apple, that that would mean retail would rush in, but the fact of the matter is with the precious of apple over the years, that's caused the retail investor to learn more about options so they can get a piece of it. derivatives are almost 40%, so they've been in apple. they just took profits after the big spike. >> toward the end of the month, we did see more resuming in the buying. >> thank you. >> yeah, i have sighing, because there's about 4,000 publicly listed stocks, great companies everywhere, all we ever talk about is apple, facebook, twitter, google, america, lots of good companies. they're out there. >> that's exactly wee we do "street talk" find the under the aregard names for our either
viewers. >> she likes you more than mom and pod. >> please! >> they're sleeping. larry robbins giving his investment views on the health care sector. watch it live on cnbc.com, or stick with us here, because we will also update you if these picks, by the way, move stocks. as soon as he mentions names, we will pass them on. let's see what the markets are doing. the markets and the economy aren't the only debatable issue of the day. how about target? firing its ceo. many are blaming the massive data breach, but why not six months later? is there more to this story than meets the eye? >> the most expensive house in america just sold. it's an insane price tag. it's the hampton of just general i had yossy and rich people, and sometimes both. we're back after this. today is monday
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up as interim ceo until a permanent replacement is found, likely an outsider, rare for targets, steinhafel's departure not entirely unexpected, thoughs timing took wall street by surprised. the last earnings release and subsequent updates suggested that the data breach is largely in the rear-view mirror, so there have to be more questions than answers, because this is about much more than the data breach. in the meantime we have a market flash, dom, what's happening? >> again, we told you if you're on cnbc, what you are watching is glenview's larry robbins present d. the top picks he has in the health care sector, one he says that's a sector that is underrealed. wellpoint and humana, just some interesting ideas or thoughts coming from larry robbins. he says pain is in the rear-view mirror and sunny days are within the wish, especially like
imwellpoint and humana. also interestingly enough, he joked around say, quote there's an alarming outbreak of old people in the united states, speaking to the growing base of clients for the health point business. he's also going to make mention positively or of man santo as well, so we're going to watch for any a, in wellpoint, hue imagina and monsanto. his top picks again as ira sohn. the presentation is extreming live on cnbc.com. guys, back over to you. >> or keeping it here on "street signs", with the help of you, he's bringing you the information. wellpoint is up 38%. if that's pain, i'll that it all day long. how, jan. >> how are you? >> we also have herb greenberg, going back to the target story.
jan, let's be clear. the dude was fired, right? he was fired. he got severance. >> he was asked to leave by the board. >> in my world that's called being fired. do you think it's because six months later? the data breach? >> i think it certainly wasn't helpful, but i've been saying for a couple years that gregg seemed disengaged from the point of view of the company. also when you have your website fail and have to the fire the ceo of that unit and you fail in canada, which they have so far, when you're fresh anywhere tiff doesn't work, and even the red card has some questions running around about it, the data breach is just the last crushing blow, maybe? >> the straw that broke the camel as back, if you like. >> right. you wouldn't fire him right after. somebody has to steer the thing after the data breach. now you can, because they brought in a new strong guy that can handle the data side. >> do you think we're being
conspiratorial lie week now? isn't it rare to cut out at ceo without a succession plan -- >> he had a date in hudson on his back for a year. >> that did kind of -- since i don't think there's an internal candidate, it's hard to do a search like that in retailing and not have everybody find out that the guy is leaving, and then it's maybe even worse. >> fair point. >> to mandy's point, herb, and i guess i gained my cynicism from her. i was optimistic before i met her and herb. >> you know this. when a company says good-bye to a ceo, that day they're gone, there's nobody on the bench. i'm sorry, the journalistic radar sort of goes off and says, there's more to the story here. i could be completely wrong, right? >> you assume when it's on a monday there was a weekend boardroom squabble and a bunch of phone calls and meetings
going on. i have to tell you something, i go back to a series of tweets that jeff macke, over at or partner at yahoo, he put out in november, pre-christmas. his father used the longtime ceo of dayton hudson, target, and he used to walk the stores with his father. in this series of tweets he was walking the stores with his kids. i went in the stores. if my tear had been there, i remember this very vividly, he would have been making a bunch of phone calls and making a bunch of people uncomfortable, because he said they were out of stock on the things you wouldn't expect. then if you go back and just look at the numbers, and just look at the sales growth, the margins, just go back quarter after quarter after quarter, that's the story, in my estimation. >> and you think that tart peaked out all the way back in 2006, so now how good they are, how long do you think a turnaround will take? >> i agree with everything herb said. they need to get back to
retailing 101. their display is not good, i don't like the product they have in the soft lines right now. the steered needs to be more interests, how fast can it come back? they're behind the eight ball on the internet. >> what's a while? quarters? years? what are we talking about? >> not quarters. >> by the way, that's the key part, the internet, because that's where we're all going. even when you talk about executives, retail executives in the future, you're talking about those who understand what's really going on. >> and the market today is saying that target's problems may be deeper than the ceo, the dow jones industrial average is now higher, walmart is down, but not by nearly as much. if it was just steinhafel, the target might be higher. it's down 3%. >> a very good investor said to me before i came in, this data breach could be the new asbestos, when people feel that way, it's pretty scary. >> jan, herb, great to have you with us.
just ahead on "street signs", well, someone made a very, very memorable cameo appearance on late night comedy tv. i'm not going to tell you who it is. you have to see for yourself. stay tuned. later on, the fight to get the ride to pay the rich more in taxes. well, it succeeded. do you feel better, america? we're going to tell you about the new 13%-ers, coming up. passion... became your business. at&t can help simplify how you manage it. so you can focus on what you love most. when everyone and everything works together,
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as soon as my name came up in this conversation, sure enough, lo and behold, look who decided to throw his stupid hat in the ring. >> would you be interested in buying a piece of clippers if it became available? >> unfortunately i don't have donnell sterling money, but if magic wants to put people together, i would jump in minority. >> now he's claiming to be an minority. >> our very own brian sullivan making light-night news, with the other guy. >> gary white with an actor
partner of his. some goodwill hunting, smart guy, talks about apple. >> you made late night. it's all over the web. you made big news. >> good stuff. only thing you can take away from the benefit of a laugh track. from now on my life's manages is to -- but second to that is to make sure this point at some point gets a laugh track. >> ha ha ha. there you go. put it in the can and play it every five minutes. its cinco de melmayo, so -- >> how about good news at the gas pump? queue the laugh track. >> ha ha. moving our company to new york state.
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recommendations thrown in for fun. we're going to start with the underthe radar name. you know that's normally when we're mixing things up, we're get creases here on stinz stinz, a prin"street signs." the. the name was up, from piper jahv jaffray. and the targets goes to. >> stock number two zumiez. they look the early -- and also like the fact that the company has cutting costs. the company needs help. >> salesforce.com getting an upgrade by deutsche bank. >> getting a 2% pop. crm is, and they're more comfortable with the company's handling of various issues, and
that the valuation is more reasonable. by the way, oracle, which i think we might talk about, is up 7% this year. >> king digital, with a price target of $23, with up side to the stock, a relative newcomer. >> and today is the day when analysts can issue that recommendation. also, the number was low. it's the maker of candy crush, et cetera. the highest one i've seen, mandy is credit suisse, the highest i've seen is $28 a share. so about nine bucks of up side, about 40% on king digital. chipotle getting an outperform rating from raymond james. >> a little cinco demayo boost. the target at raymond james is 560, about 10% up side, but the average wall street target is
$600. by the way, chipotle, a $40 stock back in late 2007. this name mass made people full, and b, rich. >> sure has. >> now to our talking numbers segment, our daily look at one stock, both a fundamental and technical perspective. today that stock is visa, topping barron's annual 500 ranks, barron saying it is our top pick. on your fundamentals is jason cupper burg of jeffries. jason, a lot of people agree visa is a great company. do you think it's as good as barron's made it out to be? >> we do think that. and i want to make a couple points here, first of all separating some of the recent private movement from the longer-term outlook. if he think about what's happened recently, visa is a stock that got call in the general downdraft of the market sets growth names, and then the
quarter came long, we karkized it as a bump in the road. the quarter could have been a bit better, could have been a bit worse, but the market is skittish about issues like russia. they did guide their revenue outlook toward the lower end of the range for the year. if we start to look at the stock in a longer-term context. they're still growth drivers, a tremendous, competitive mode for this franchise globally. we would argue we're also in the time frame of regulatory and legislative risk is a bit diminished, so at the end of the day you've got a stock that's pulled back to around 19 times forward earnings and it's been while with a franchise of this quality if you believe, as we do, that structurally this company can still produce interest in the high teens, visa is a strong buy here.
>> singing a lot of praises there. did the chart sing those praises as well. >> the charts do agree, if you separate the longer term from the shorter term. if you just look at a multimonth chart, you see visa is down 15% from the highs earlier this year, 7% year to day. however, you take a step back, this is exactly what technicians want to see. all what to the upper right. you have a 50-week moving average, and if you were looking at the stout -- you would pray for a 50% pullback to get involved. now of a sudden -- what i do like about it is it has been orderly. it stopped right around the 200, which is, you know, a key level. it stopped right at your moving averages. look at some of the short interests. there were some shorts piling into the name earlier this year. however you're starting to see the shorts unwind.
good up friend, i like to be a buyer right here. >> until recently the pullbacks were few and far between. both of them bullish. >> thank you. you can always check out the online edition in partnership with yahoo finance. after the show, of course, after you finished watching this fine show, check it out on cnbc.com. >> about 11:45, log in on my ipad, boom, check it out. watch myself. a great way to go to sleep. if you're one of those people -- he's not that wrong. do the richest pay more in taxes? we have good news for you. or not. >> something that taxes us all, rising gas prices, i'm sure e's good news coming up in the close bell. let's find out what's happening. >> always good news howard, sully. why did bill ackman, for example, carl icahn kissed and made up after that big fight over herbalife.
bill ackman is with us today. he will discuss his controversial move to team up with valiant to buy botox maker allergan. also all eyes will be on aig's earnings after the bell, and we'll have those results broken down even before they speak toss analysts. and we could wait for this. joined by one of the owners of kentucky derby winner california chrome. >> i love this story. steve cobert will be with us, it starts at the top of the hour on "closing bell." see you then. tdd#: 1-800-345-2550 trading inspires your life. tdd#: 1-800-345-2550 life inspires your trading. tdd#: 1-800-345-2550 where others see fads... tdd#: 1-800-345-2550 ...you see opportunities. tdd#: 1-800-345-2550 at schwab, we're here to help tdd#: 1-800-345-2550 turn inspiration into action. tdd#: 1-800-345-2550 we have intuitive platforms tdd#: 1-800-345-2550 to help you discover what's trending. tdd#: 1-800-345-2550 and seasoned market experts to help sharpen your instincts.
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two years in a row. wheat futures jumping to a 13-month highs, they say concerns over the hot dry weather are pushing those prices higher, tensions in ukraine are also adding to the tensions, with ukraine being a leading wheat producer. gas prices are rising, national average is 3.67. let's go to jackie deangelis at the nymex. >> good afternoon, brian. this is a seasonal shift were seeing, a couple reasons for
this. the first one is we do see the refineries switching over from the heavier winter blends to the lighter summer blends. that typically is alts more expense i have been, but this is the time of year more drivers get on the road. now floor traders are telling me they do expect the increases to get steeper and actually the peak time is july 4th. that's when traffic is the heaviest, not great news for consumers, but other experts, more bearish on gasoline prices right now. they're saying at this point we could see price declines actually. this is the lundberg survey saying this, because they think that oil prices are on the decline. obviously oil prices impact what we see at the pump. other traders are countering that argument saying, look, yes, oil price versus come down, but they are going to stay supported for several reasons. the first is geopolitics, but also the delay of the key does that tony popline. the third reason would be the expectation that the u.s.
economy is going to continue to recover. so there's two sides to this argument here, but again, the trader here at the nymex say the gas prices will go up. but one thing we can all agree on is consumers don't like to pay more at the pump. back to you. >> thank you, jackie. normally gas prices go higher heading into memorial day, but our next guest thinking prices have already peaked. joins us is gadbuddy.com analyst patrick dehawn. am i going to be paying less on the first day of summer? >> it looks like it across much of the u.s. in fact california motorists may be the biggest winners here compared to what we saw. prices there are going to be dropping significantly. in fact much of california could even be below $4 a gallon, but around the country we could see sizable relief arriving.
other problems related to the supply chain, geopolitical tensions, but even those factors, it's looking pretty good right now. refineries are done with, say, 75 to 85% of their maintenance season, so that factor is winding down as more refineries are coming out of maintenance. so that transition has been completed. that risk factor is now out of the equation. it's looking really good. oil prices, yes, some analysts have been citing they may go up or down, but i don't see a lot of significant bullish factors, at least for another month or two when the hurricanes season then begins. >> thank you for being the purveyor of good news. we're getting breaking news now on general motors. gym fed erico has resigned resigned from the company. he was heading up a team investigating that as well. again, the news literally just
crossing right now. don't have more than one sentence. not a household name, but a big guy at the company. phil lebeau is working the phones, calling sources at gm, trying to get more. >> and there's a chart for gm. just moving slightly to the down side. we'll obviously be keeping an eye on any stock reaction as well. yeah, looking more -- again, i do not know him. i'm sure phil lebeau certainly does, but phil lebeau will be up next here, there you see the banner. direct report to mary barra in 2012. the rich are paying more in taxes, 13% more by one estimate. did it have any positive impact on the economy? >>. >> also two of our favorite combaters, are going to be debating that exact topic, coming up next.
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could mean less waiting for things like security backups and file downloads you'd take that test, right? well, what are you waiting for? you could literally be done with the test by now. now you could have done it twice. this is awkward. check your speed. see how fast your internet can be. switch now and add voice and tv for $34.90. comcast business built for business. welcome back to "street signs." i'm phil lebeau. jim federico one of the company's top engineers, who has
been with the company for 36 years is leaving general motors and is retiring to pursue other interests. he was one of the top engineers involved in the whole ignition switch recall as they were analyzing the problem back in 2012. he led a group of engineers who looked into the faulty ignition switches, and at one time he had been a direct report to mary barra. again, he's decided to leave the company to pursue other interests. what's interesting about this, brian and mandy, look at him leaving and jim calabrese at the forefront of ignoring what's going on with the faulty ignoring switches, you have to wonder if you're seeing a number of the engineers eligible for retirement or to leave the company have been indicated or told by the company maybe it's time to look for a job somewhere else. officially they are leaving on their own terms, a word from the company.
unofficially you have to wonder if this is the beginning of mary barr and her executive team to say this is time to bring in fresh leadership. >> thanks very much. we'll keep watching this story. and a quick look at what the markets are doing right now. as for general motors it really hasn't moved on that particular story. in fact, it was down half a percent a few minutes ago and the markets themselves are at session highs. we're currently up by about 27 points, i know it's not much and holding in positive territory there across the board. >> if you want higher taxes on the well to do and wealthy your wish may be coming true. tax filers paid 13% more that year than on the same dollars of income in 2012, this despite tax rates going up by 4.5%. let's bring in cnbc contributors jared bernstein and jimmy b. one guy, bob klein, market watch and did the interesting math, okay, medicare tax and reduction in deductions, additional tax on
capital gains. do you think this will, if it's true nationwide, satisfy those who say the rich aren't doing their fair share? >> first, let me say that that is really deceiving to thinking that it went from 35% to 39.6% because you also have some limits on personal exemptions and the deductions and the real effective tax rate for people over $250,000 category is really closer to 44%, 45% so that's a pretty big jump. this guy's numbers aren't far off. will it satisfy people on higher rates, you know, what they went and read "capital" by thomas pikwitonei so he wants 80% tax rates. if he wants 80%, we're only halfway there. >> do you think the 13% helps in any form or shape, jared, or is it potentially going to be a drag on growth? >> i don't think that the 13% that you're talking about was a drag on growth because that's from the very top of the income scale. i actually do think that allowing the payroll tax to expire in 2013 probably was a
bit of a drach on growth. listen, by the way, i agree with jimmy's points is you have to factor in the other rates that both brian and jimmy mentioned if you want to calculate the correct marginal rate but that's not the effective rate. jimmy said effective rate and i think he meant marginal. that means as a share of their income it's true that the folks at the top are paying more, but you also have to understand that that is where the income growth went. it didn't go to the middle class. it went almost exclusively to the top. >> jared, are you in the 80%, club, because it kind of sounds like you are at all? >> it is true that that was recommended as a global tax on wealth. also true that that ain't going anywhere, so in the real world, i think that what we're talking about here with the changes that were made in the fiscal cliff deal at the end of 2012, i don't think they hurt growth. they probably helped lower the budget deficit a bit. >> by the way, one thing
pikwitonei has done, it's really come from equities, right, so at least he's bringing out something there to the argument that we thought it's what people make in their paychecks. that aside. do you think that will quell the feel, if people dig in, or there's no number other than the 80% that would make people happy and this theme that continues that the wealthy people don't pay their fair share? >> people who care about taxes that welcome americans make it won't satisfy them and there's other left of center comments who put the top marginal rates should be in the 70% range.
>> we've got to go. jared, do me a favor, you're a powerful washington guy. can you please take some of this extra money and make sure that the trains work and airplanes work, that there's not gigantic sinkholes in the middle of the beltway. >> that's infrastructure investment, and we definitely need to do some of that. by the way, takes some tax revenues. >> i'm in favor of raising the gas tax. did i just say that? >> you sure did. i'll have to walk out of here with a security guard. >> thank you both very much. >> coming up next, the $147 million house. >> what are you going to do with it all? how are you going to decorate? i always say be the man with the plan
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a record home sale in the united states. robert frank is the man who knows all about this. what is the story and what is the price? >> reporter: the story starts on a little road in the hamptons called further lane but it should be called richer road now. this rod now has the most expensive listing. an 18-acre estate that just sold for $147 million. the buyer is barry roens stein and steve cohen just purchased a home nearby for 62.5, jerry sign field and jerry chanos. before that only two properties ever hit that nine-figure mark. fleur de lis in l.a. sold for $102 million in march followed
by copper beach in greenwich, 52 acres for $129 million but these are cheap next to london. just sold a flat in london for $230 million. >> who has that kind of money? >> rich people have that money. >> thank you so much for that, robert frank, and thank you very much for watching "street signs" as well. >> "closing bell" is next. >> welcome to "closing bell" on a monday. i'm kelly evans here at the new york stock exchange. >> welcome back. >> i was just celebrating the anniversary. >> yeah. >> for an extended bill. >> markets struggling to be positive on this first trading day of the week and didn't get much help from europe. european markets down on news from asia. t