fed survey. but we start with apple. it reports its numbers after the bell. about three hours from now. it is the story everybody's talking about. sue herera is at her new perch at the new york stock exchange as the traders buzz. >> good to see you, ty. indeed, that's what everybody is talking about down here or one of the things everybody is talking about down here. we want to start by showing you two apple charts. now, this is the year to date chart you're going to be looking at. as you can see, it's a pretty decent percentage gain on apple. notwithstanding today's move to the downside. overall, the stock is up almost 40%. but since april 8th, things have really turned around. and apple shares are down about 11%. causing a lot of pain for investors. jon fortt is our apple watcher. he's looking ahead to today's numbers amid some rather ominous signs, jon. >> let me clarify. apple is still growing like crazy. more than enough to justify the multiple where it's trading now using traditional methods. wall street's expectations have gone sky high. there's the possibility the actual results could disappoint. the whispered number is 33 million iphones. based on numbers we've seen from at&t and verizon that's going to be very hard to hit. 28 to 30 is more realist you can. ipads, street wants 20 million. tough to hit. new ipad had two weeks of sales in the march quarter. 10 or 11 might be more realistic. by the way, it would be more than 100% year over year growth. maces are expected to be relatively slow. 4 million units. apple hasn't refreshed the line-up in a while. word to the wise, apple is going to report its cash reserves have zoomed past $100 billion. probably close to $110 billion. this could be a repeat of q-3 where the street gets spooked by one quarter and loses sight of the big picture even if the company misses. >> let's talk with steve weiss, cnbc contributor from short hills capital. let's say numbers come in and they are really good. they hit it out of the park. i already own apple. don't want to buy more. don't want to sell it. what can i buy that's going to move along with apple. >> you can buy qualcomm. qualcomm got beaten up on their quarter because they had a shortage of 28 nano chip. they are extremely cheap. they're growing very, very fast. faster than almost any other tech company. you buy them. you could also buy a broadcom. a little spooked today. mobile chips, maybe a little softness there. it's company by company. apple released their supplier list a few months ago. the issue is, you can't go by that because you don't know how big the supplies are to apple, number one. number two, they won't talk about the companies because then they won't be doing business with apple anymore. i would go with standbys. sandisk not a big apple supplier. very cheap. >> sandisk. broadcome, qualcomm, possible movers. >> absolutely. >> you're going to come back later and tell us what the heck to buy if numbers aren't so good. >> absolutely. >> see you before then as well. sue, back to you at the exchange. >> breaking news from chicago. one of the challenges for the market this week is off loading supply. rick santelli is at the cme with the details on the first step, the 2-year bond auction. how did we do? >> i'm going to give this auction an "a minus." almost a straight "a.." let's go over the metrics. 35 billion 2-year notes. the yield, .27. where was the market trading in the one issued market up to the end of the auction? pretty much right there. 27 point basis point bid offered at 26.5. the bid to cover, 3.76. blew away the 10-auction average, 3.56. the second best number going back to september of 2010. to find a higher number you'd have to go back to november of this past year. that was good. indirects were 32.1. pretty much right on the 10-auction average. the directs were a little light at 7.8 versus an auction average of 13. the "a minus" because dealers took about 60% of the auction. i'd rather see it in the hands of investors. still an "a minus" auction. >> pretty good considering the troubles in europe. a trio of blue chips posting better than expected results this morning. at&t's first quarter earnings rising 5.2% from a year ago. that telecom giant's iphone sales declined, reducing the amount of cash it had to pay to apple. the company also seeing fewer people cancel their services. shares of at&t right now are up on the trading session by 1.16. 3m's q-1 profit up about 4% on strong sales to the auto and aerospace concerns. the company boosting bottom end of its full year forecast. shares on the upside by 1.79. unite technologies first quarter profits up 22% from a year ago. revenue, though, in below expectations. right now shares in that company are last traded -- they were on the upside the last time i checked. all right. broader picture, the dow off of its best levels of the trading session. but we're still up about 80 points. one big reason is ibm. good to see you, my dear. >> always a pleasure to be with you. 22 years, sue and i together. bottom line here -- >> a happy marriage. >> ibm boosted the dividend. 13% to 85 cents. a lot of companies boosting their dividends today. parker hanifan as well. bear in mind, the s&p, 1.9%. they're actually below the s&p's dividend yield. ibm has been boosting it for years. they've never been a big, big dividend payer. see the stock is up here. by the way, earnings have been great. you mentioned three companies. >> three that all beat expectations, solidly beat expectations as well. >> they're doing this on a regular basis. earnings right now up 4.9% on the s&p 500 for the first quarter. remember a few weeks ago there was panic it was only going to be up 1%. every day they've been beating the numbers. >> how come we haven't held on to the triple digit advance? >> it's been tough over in europe recently. it's a hard time right now. >> thank you. see you a little later in the show. another big mover on the menu is hershey. after reporting its numbers, darren rovell, he's up to bat with what's up at hershey. >> there you go, sue. hershey left a sweet taste in the mouths of shareholders this morning when it reported the profit rose 24%. shares right now up big as you can see. approaching highs not reached since may 2005. how did they do it? well, it's actually the story that makes many successful companies that are telling this time of year. they raised prices last year by 10% to offset the price of raw materials. when the costs came down, they kept the prices the same. the public either didn't notice or didn't mind. margins, of course, soared. everything hasn't necessarily turned around. the companies that can keep their prices up by providing perceived value as costs drop will be the winners. that's what's driving hershey today. tyler? >> our sports, business and chocolate reporter, thank you very much. steve liesman back in action with the latest fed survey from cnbc. right now the focus, steve, is on growth forecasts and fears. i'm all ears. >> yeah, tyler. what's happened is the markets got a little more possess mesic. come more in line with some of the talk we've gotten from fed chairman ben bernanke. the april fed survey. 53 economists, strategists and analysts answering our call for information. let's look at the u.s. gdp forecast and what's happened july, march and april. you can see it's come down quite a bit. compare it to july. that was nearly 3% back in the summer of 2011. it's come forward here. you can see we've dropped 2.39 from 2012. 2013 forecast. 2.74 back in july. or march. now let's see. we didn't have july. that was march. april, 2.55. a quarter coming off the gdp outlook. what does mark zandi say about this recent sort of slump we're in? the current low in economic activity will likely prove temporary and additional monetary stimulus unnecessary. that's why we have 33% of respondents saying they expect qe-3 in the next 12 months. moving on, given the still considerable downside risk is appropriate for the federal reserve to have a bias towards further action. that's mark zandi of moody's analytics. the probability of recession in the next 12 months. that's remained pretty much the same. august, what you see here, this is the distribution in august. i want you to point your attention to these fat tails here. 90%. let's look again at the april numbers. you can see it shifted to the left here with a lower percentage of probability of recession. here are the numbers here. 2 one of the biggest threats to the economy, the euro crisis taking the lead here compared to march. taxes and regulation coming off. gas prices. other was 17%. if you wouldn't mind zooming in. what are people afraid of? one of the things is housing, deleveraging. the fiscal cliff. people are afraid of their own shadows said one person. joe lavorgna commenting. in our view, north of $150 on w texas intermediate is a point at which recession risk rises materially. we are not there yet. tyler, what's happened, we've had a shift. people -- more and more believe in the guidance from the fed. asked when the first rate hike would come, 40% -- let's go to tyler right now for breaking news. >> thank you very much. we're going to go to courtney reagan now. we're going to hold off on that. steve, you have a big day tomorrow. so does cnbc, by the way, as we deal with the fed. 12:15 brian sullivan will anchor a special report on the fed's decision on interest rates. then at 2:15 eastern we will cover the fed chief's press conference. a lot going on tomorrow. i'm glad, steve, you got a week off and have some rest there. you're going to be working it and earning it tomorrow. now to diana olick down in washington. she's got the latest numbers on new home sales. diana? >> that's right, ty. this was a tricky one. first this big headline, 7% monthly drop in sales. then you see that was only because february was revised way up dramatically. that only proves the premise that home sales were, in fact, pulled forward thanks to unusually warm weather. remember, these numbers are based on signed contracts, not closings. it's particularly telling on the weather. now, take a look. also telling is what's selling and where. sales way down in the midwest and out west. that is, of course, where the highest volumes of foreclosures and short sales are. don't let the builders tell you they don't compete with distressed properties. they do. sales were up in the northeast and in the south. prices for new homes are up. but overall prices still falling on the case-shiller index. that's existing sales. the price conondrom is so telling. more on the blog. >> thank you very much. now for that promised breaking news and courtney reagan with more on the walmart story. >> good afternoon, tyler. we are just getting this press release coming out from walmart right now as we're scanning it through. i want to get you some of the headlines right away. walmart responding to "the new york times" article this weekend about those bribery allegations in mexico. it is working diligently, it being walmart, on the fcpa compliance. they've created a new global fcpa compliance officer position. walmart saying it will not tolerate noncompliance anywhere in the company. this can be attributed to the communications office at walmart. david tolvar is the individual responsible for making these statements right now in the press release. they also want to point out "the new york times" story about the decisions made are more than six years old. they continue to say these actions that are alleged did happen in the past. of course, we know this brings many, many questions to light, current and past. >> courtney, thank very much. over to brian shactman on our stocks desk to find out what's moving in the markets. >> power lunch pop. thank you very much. look at access national. they have profits up 50% in the first quarter. they increased their dividend. an intraday chart of ancx. you'll see right during the show. pop. up 5%. it's been up as much as 6%. small cap regional bank. back to you. >> brian, thank you very much. james murdoch playing the role of dover sole in the griddle once again. once again over the hacking scandal at news corp. used by the murdoch media empire to get the inside scoop for its british newspapers. shares in the past year of news corp. recovering even if rupert's reputation hasn't. news corp. shares up more than 8% over the past year. kayla tausche is live for us in london. kayla? >> reporter: well, ty, the independent inquiry that was launched last summer into media t ethics in the uk has questioned politicians, celebrities. you name it. today james murdoch was in the hot seat. he faced a harsh grilling over what he knew and allowed under his watch at news international. that was based on hundreds of hours of prepared testimony and countless documents that were pored over for that. the early questions today centered on the stark lack of oversight when he took the reins in 2007. why he didn't investigate claims of hacking and big legal settlements that had happened earlier. he said he had no reason to suspect wrong doing and that the editors had held the keys to the paper. now, the commission took the most issue with the way that news corp. and other senior lobbyists in europe dealt with politicians over the hotly contested and long winding takeover, attempted takeover, we should say, of british broadcaster b sky b. >> i don't know the ins and outs of westminster protocol. but i do, you know, but i was it shall we were receiving feedback and information. you know, through, you know, through our public affairs channel. >> reporter: now, the commission pointed to more than 100 e-mails between murdoch and senior europe lobbyist fred michelle mainly concerning uk regulators launching the review of b sky b. a lot of that communication the commission said was illegal, pointing the blame toward regulators sending news corp. shares flying. that's a trend that can continue depending on what rupert murdoch says for the rest of this week. tyler. >> let's go to sue down at the exchange. >> that's right, ty. we had a triple digit loss as you know yesterday. triple digit gain earlier in the dow. we're edging back up towards that. what should you focus on? art cashin is here. good to see you, my friend. >> good to see you. i'm glad you're here. i can't wait to see you on the new set. >> i'm going to be bugging you every day. i'm back home. talk to me about what you're watching. i know you were watching the euro and the dollar earlier. a little bit of a strengthening in the euro because the dutch managed to get their auction off pretty well considering the problems there. >> yeah. there was not nearly as much damage as was originally feared. and european stocks bounced back. they gave back some of that. but they're solid. the other thing i'm looking at is the difference in volume. yesterday in the selloff, we had some pretty significant volume. the run rate right here is for less than -- for it to drop by 70 million to 100 million. >> handicap the afternoon trading session. what are you going to be watching for? >> i think you're not going to see a lot of action. i think you might see the market fade a little bit. you're going to be going into the vigil of the fomc. they'll begin meeting this afternoon. you'll get the announcement tomorrow. that may free some people who are afraid to play a little bit. then we have to worry about europe overnight and what happens tomorrow. >> then there's the news conference with mr. bernanke as well. >> yes. we'll be parsing every word. >> later in the week. thanks, art. ty, back to you. you probably have heard the news or maybe somebody just poked you. facebook is going public next month. up next, kate kelly has some information for us that says they might, and i stress might, not be ready when everyone thinks they will be. that's next. before the break, let's look at five of today's top stock market movers. ♪ stream, stream, stream... ♪ strea-ea-ea-ea-eam ♪ ...stream, stream, stream... ♪ whenever i want you, all i have to do is... ♪ [ female announcer ] introducing xfinity streampix. stream your favorite movies and full seasons of shows instantly on any screen. find out more online. bp is declining comment on a story we brought you just moments ago. a former bp engineer has been arrested and charged with two counts of obstruction of justice. he is charged with destroys evidence requested by authorities in connection with the deepwater horizon disaster. curt micks could face 20 years in prison and fines of up to $500,000. facebook, of course, sprinting towards its ipo. yesterday's disappointing revenue report is only turning up the pressure on the company to get to market. but could its recent spending spree slow it all down? kate kelly has been looking into that. here we're talking about the purchase of the photo service. >> absolutely, tyler. there are a couple of things that could be throwing a wrench in the calendar they had in mind. essentially, they were looking to go public in the month of may. that would mean hitting the road with a road show where they make the pitch to investor. that's about a ten day, maybe two-week process. may 7th was the original thought. may 14th was kind of the fallback. i'm now told it's much more likely to be may 14th. the reason is they just did two sort of surprise purchases. instagram for 1 billion bucks. these aren't material. in all likelihood this is a $100 billion company. this amounts to far less than $5 billion put together. it triggers the needs for additional disclosures to the sec which may in turn have questions for facebook it needs to answer which may mean more paper work. in general i'm told ceo mark zuckerberg is very focused on running the business and doing deals. that's not a bad thing. it does mean he and some of his staff have not been able to focus wholeheartedly on getting this thing ready to go public, tyler. it's even possible in a plan "c" they actually go public in june. >> bhawhat's the matter with ju? what's the magic about may? >> couple of things. it's not a huge deal. they would like to be able to go public early enough in the year that six months from the public date, they can still sell some shares. in other words, you're locked up for six months if you're an insider who has shares. they would like for folks to be able to sell those shares no later than the end of 2012 because of some tax advantages associated with 2012. if that sale happens in 2013, it's a higher capital gains hit to them. >> aha. if they did it in june they'd still fall under the six month. >> they would. >> gets closer. >> exactly. a little closer. the other thing, they have a lot of momentum in may. markets tend to be more liquid in may than over the summer because of vacations, et cetera. you know, revenue yesterday a little bit disappointing. i don't want to make a mountain out of a mole hill. they're incredibly strong. $4 billion in cash. users are growing. they're going gang busters, obviously. but it's good to keep the ball rolls once you have the momentum. >> down to sue now with a little more. >> that's right. we're going to tell you what's coming up, ty, when i rejoin you in just a few minutes. apple's numbers are out after the bell. we're also expecting a very interesting and important announcement from google this hour. and you won't want to miss this. tomorrow, a programming note on cnbc. john harwood sits down with an exclusive interview with treasury secretary tim geithner. ty and i are back with more on "power lunch" in just a minute. is to take you from where you are... to where you need to be. and we're not just talking about points on a map. with a more intuitive delta website and mobile app... and the most wifi equipped planes. we let you be everywhere at once. innovations like these are extending our reach so you can extend yours. and now, even at 30,000 feet you can still touch the ground. ♪ ( whirring and crackling sounds ) man: assembly lines that fix themselves. the most innovative companies are doing things they never could before, by building on the cisco intelligent network. president obama speaking at the university of north carolina right now about the student debt crisis, urging congress to prevent interest rates on student loans from doubling in july. eamon javers is at the white house. eamon? >> reporter: certain key federal student loans. he and mitt romney agree on this. that reflects sort of a bipartisan consensus here in washington that student aid is a good thing. take a look at the numbers going back to 2001. you get a sense of just how much it's increased over the years. starting in 2001, total federal aid was $69.781 million. 2006 and 2007 that was over $94 million. just in the past cycle, 2010 and 2011, $169 million in federal aid. like i say, student aid advocates argue that's a good thing. but i do want to bring you up to speed on at least one counterargument to that which says that maybe all this student aid isn't such a good idea after all. the kato institute back in 2005 up to today arguing what this student aid does is affect the the supply and demand dynamics in the education market and actually raises prices. kato saying federal loans, pell grants and other assistant programs result in higher tuition for students at our nation's colleges and universities. nonetheless, tyler, you can expect that this proposal today from the president is going to be very popular among students who are looking for those student loans. >> and that debt clock moving toward $1 trillion. metals market about to close. moments from now. gold making a move for most of the day. we're going to have that close coming up for you in just a moment. moment. [ tires squeal, engine revs ] ♪ ♪ ♪ [ male announcer ] not everything powerful has to guzzle fuel. the 2012 e-class bluetec from mercedes-benz. see your authorized mercedes-benz dealer for exceptional offers through mercedes-benz financial services. mine was earned off vietnam in 1968. over the south pacific in 1943. i got mine in iraq, 2003. usaa auto insurance is often handed down from generation to generation. because it offers a superior level of protection, and because usaa's commitment to serve the military, veterans and their families is without equal. begin your legacy, get an auto insurance quote. usaa. we know what it means to serve. welcome back to "power lunch." the gold and other precious metals markets are in the process of closing right now. gold has been showing some resilience today. it's up about 11 bucks. sharon epperson is following all the action from the nymex. i find that interesting given the strength that we saw earlier in the euro and weakness in the dollar, sharon. >> it does seem that gold is like a risk asset today. that is how it's trading. we are seeing it slightly higher. not as high as some of the other metals. keep in mind, there's a lot going on in the gold market that is anticipatory. we are waiting to see what happens with the fomc decision. we are waiting to see what happens with the options expiration that will occur on wednesday's session. there will be a lot more activity around this time tomorrow with that options expiration and, of course, the anticipation of what that fomc decision will say. we've noticed that gold has actually been very range bound recently. it only traded in a $15 range today. the $10 move or $11 move you see here at the close in terms of the gains, a lot of that was made early on in the session. elsewhere in commodities we are looking for silver prices higher as well today. the gold/silver ratio has come back in quite a bit here as we've seen the prices steady a bit. we're also looking at copper prices. copper is really the biggest gainer here. we did see that positive outcome in some of the european sovereign debt auctions that occurred. that really helped the euro earlier in the session and then helped many of the metals along with it. that was the key driver early on for the gains that we are seeing the risk on sentiment that we've seen in the commodities sector in many commodities, including gold and some of the other metal. sue, back to you. >> thank you very much, sharon. let's focus in on some of the key stories moving. bob pisani rejoins me now. you want to start with walmart. >> what a bad trade this was. >> i was just going to say. >> what are they accused of? paying $24 million in bribes? they've lost $15 billion in market cap in the last two days. for $24 million i think they could have gotten a better deal. i don't mean to make light. their heads must be spinning. >> when you look at the numbers, the metrics, it crystallizes what those allegations have really taken on the stock. >> $15 billion is not peanuts to walmart. it's below $200 billion market cap now. the rest of the earnings, illinois toolworks. all raised estimates. that's why the numbers are going up. estimates we're seeing. not just united tool works. see these companies? they're beating every day. that's why we're almost 5% earnings growth for the s&p. i'm concerned about housing. diana mentioned how good the numbers were. we're sequentially coming town. march numbers were not as strong as february numbers were. across the board. new home sales, existing home sales and housing starts. >> one month does not a trend make. >> i'm hopeful we'll see a little on the reversal. right now a little bit of concern. >> bob, thank you very much. appreciate it. basically, let's head to seema mody. she's got the big movers in technology specifically at the nasdaq from her perch. >> that's right. the nasdaq is trading lower. let's take a look at some of the stocks that are weighing on the index. symantec the worst performing stock on the nasdaq 100. firm cut q-4 outlook as it signed fewer contracts. netfl netflix, of course, we know the story there. growth outlook concerning the street. more concerning for investors is apple. a combination of earnings, uncertainty as the recent selloff is weighing on the tech giant. interestingly enough, though, some of its competitors like google and amazon, though, sue are trading higher in today's session. back to you. >> i'll tell you, you know, when it comes to the first day of a two-tay fed meeting, it just gives traders that much more time to try to debate what's going to change. a couple of key points they're focusing on, very near and dear to their memory is the reit jobs report. they're wondering will that give the fed and ben bernanke a chance to maybe downgrade expectations? will they be altered at all? there's such a gap between now and the next june fed meeting operation twist is scheduled to finish off and wind down in june. they suspect if they're going to extend the twist, many traders believe they will, they need to put the framework for that extension potentially in this statement and/or press conference. as you look at the charts, we're definitely on the low end of yields. we've had close to a 50 basis point range since the last meeting on may 13th. sue, back to you. >> thank you very much, rick. all right. let's switch to our power player right now who says given the interest rate environment that ricky just outlined, investors should get a little leverage or debt into their portfolio. especially in this environment. here to explain why is phil conway. head of capital advisory at jpmorgan private bank. good to see you, phil. thanks for joining us on our first day here on the exchange on "power lunch." it's counterintuitive for a lot of investors to think about putting leverage back into their portfolio. because leverage was the monster that got us into the 2008 deb k debac debacle. you view it differently. >> leverage is a tool you can dial up, dial down based on the opportunities. with interest rates as low as they are today, the opportunities looking better, there are opportunities to use leverage as a tool in appropriate amounts. >> on the floor and in financial services, they call it adding some alpha to your portfolio. in other words, a bigger gain than what you might ordinarily get by adding some of this debt. give me an example of what you would do to a portfolio to perhaps multiply the yield out for those who want yield. >> i think there's a couple of good examples. right now so many investors are interested in fixed income. if somebody's got a high yield portfolio, say that's got an average yield of 5%, 5.5%, you can put a modest amount of leverage on that portfolio. anywhere from 30% to 50%. your return on invested capital, then, is going to be in the 8% to 9% range. that's a good way that you can do it as opposed to trying to get that additional yield either by going down in credit quality or extending duration. >> you know, another thing you suggested when i was looking at my notes, we saw a big dip in the stock market because of tax-related selling. you can use leverage in your view to avoid having to sell some of the winners in your portfolio. >> yeah. exactly. even very rich people have gaps in their cash flow and need access to liquidity. if you don't have that access to liquidity, too many clients will sell portfolios before they've reached points of maturation. or befoor they've reached the appropriate capital gains treatment. to avoid that, having access to liquidity is really important. tax season that we just had is a great example of that. >> we have the fomc meeting, a two-day meeting this week. everybody is wondering whether or not interest rates might start to edge a little bit higher sooner rather than later. how does that work when you're applying leverage in your portfolio? what if the interest rate scenario changes? >> that's the beautiful thing about leverage. if you're using it in modest amounts, you can dial it up or dial it down. if interest rates do begin to rise, one of the reasons is asset prices are rising. the fed is worrying about inflation. there's still going to be opportunities on the asset side. but you would want to use in a rising interest rate environment, fixed rate loans or buying a cap or a swap to fix the interest rates based on current levels, and that's an attractive way to play it in a rising rate environment. >> can the average investor, though, do that? or do they have to go through an adviser who would apply that leverage for them? because it's a slippery slope if you don't understand the debt cycle. >> it is. yeah. i think the average investor can access that by looking at fixed rate loans in a rising rate environment. if it's a high rate environment you're going to stay short, a floating rate debt. yes, the average investor can find these opportunities. they just got to realize that it's not the leverage that creates volatility. it's the underlying asset class. make sure you understand what you're putting the leverage on. >> always good advice, whether you're talking about leverage or anything else, right? >> absolutely. >> thanks, phil. pleasure to have you here. all right. here are your big stories. 38 minutes past 1:00 p.m. on the east coast. apple shares trading lower once again ahead of its earnings after the bell. new fears about iphone sales. we're going to be all over those numbers, of course, as soon as they cross. ibm giving the dow a lift. its boosting its quarterly dividend by 13% to 85 cents a share. the tech giant also announcing a $7 billion share buyback. shares of big lots tanking in today's move to the upside in the overall market. they are down 20%. the retailer cutting its outlook and getting a number of downgrades as well. coming up next on "power lunch," james murdoch back in the hot seat grilled over his involvement in the uk hacking scandal. so what's the end game for rupert murdoch's media empire? plus, what do nokia, radio shack, rim and netflix have in common? well, today they were all big losers. they're down 60% to 80% over the past year. which one will be the biggest loser? more on "power lunch" after a very quick break. guys. come here, come here. 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[ male announcer ] it's a network of possibilities -- helping you do what you do... even better. ♪ hopefully by now you know it's dangerous to talk on your cell phone and drive. this girl fell through a sink hole on a sidewalk in northern china while concentrating on her talk rather than the walk. she is fine. she got probably the scare of her young life. move on now to the power rundown. we give the topics, the questions. then we answer them. we ask ourselves the question. we're going to do it fast. it's our take on some of the headlines and some of the stories that are below the fold in the paper, as they say. cnbc.com's john carney is with sue and me. apple, can they hit these numbers? >> i think they can. we may see upside surprise from apple today. that a lot of attention is going to be paid to how many computers are they selling? we know they're selling tons and tons of iphones. tons and tons of ipads. are they still selling the macs? that's going to be a selling number. >> sue, there are lots of suggestions here that maybe they're not going to sell as many iphones as people thought. >> exactly. i think the street ran the stock up in a big way. you know, up until a couple of weeks ago. and now the jury is out as to whether or not the growth that the street is used to is still in the stock. that's my worry. >> man, you've got to grow a company the size of you pick the company. just to keep that up. my worry has been for weeks now that whenever you get above that -- that half trillion dollar market value which they did when they were a $600 plus stock, the history of those kinds of stocks, whether it's cisco, microsoft, general electric, exxon, is not in its favor. >> none of them have ever gotten back to that particular benchmark. >> look at apple. apple has a record of outperforming. i think we actually have -- >> so it's different this time! >> -- a good chance of people being surprised to the upside again by apple. >> they tend to sandbag. >> every time i hear that it's different this time. >> like me and my golf handicap. let's move on to number two. james murdoch defending his record in that british phone hacking scandal under oath in a london courtroom today. rupert's son says he had no idea the phone hacking scandal was so widespread. do we believe him, sue? >> you know, i just think that this story has gone on and on for quite some time. and, you know, obviously it still has legs. kayla's been doing an amazing job covering it over there. but i do think that, perhaps, there's more than is being said. i'll put it that way. i'll put it politely. there's probably more to the story than has been revealed so far by mr. murdoch. >> i'll put it a little less politely. i think the murdochs didn't know anything about this. you wouldn't call your boss and say, you know how i'm getting all these great stories? i'm hacking into people's phones. that's not what happened. i think there's a lot of politics behind this. people want to get the murdochs. they want to punish them politically. that's why this case keeps going on and on. >> you wonder if -- if this story would have had so many legs, if it wasn't murdoch the elder and murdoch the son whose interests are at stake. let's ask piers morgan if they knew what was going on. i'll bet you piers would be very interesting on this. i think i'd ring the buzzer and say out of here for those guys. let's talk a little bit about new jersey. our home state. we love new jersey. here's something that the governor never shy for con troerersy says. you better spend your prepaid gift cards pronto. the garden state wants to seize cards that you don't use after two years and put the balance towards fixing roads like the turnpike. aren't the tolls high enough? >> i actually support this. i think it's a really good plan. what happens right now is the companies keep the money. you buy a $50 gift card for somebody. they spend $48. there's two bucks left on the card. nobody ever uses it. the company gets to keep that money. why not see some public good. >> if i gave you a gift card, right, i've paid up front for it. and, you know, for them to take that and put it into the turnpike, really? american express has already pulled out saying they're not going to do this. >> right now it's really just going to corporate profits. companies know you're not going to spend all the money. >> i spend every penny on my gift cards. >> why does the state have to take it from the company? i don't get that. i don't get the connection. >> companies right now are insent vised to discourage you from spending all the money on the card. >> that's the gimmick of them. >> exactly. it's the gimmick. so what this will do is actually insent vise them to encourage you to spend it all because they're going to lose the money anyway. >> john, you have to kpcome shopping with me, honey. i will get you to spend every penny on that gift card. >> the new jersey nets are leaving. maybe some other companies will do the same. they're going over to brooklyn. up next, folks -- thanks a lot, guys -- google's plan for the cloud and way beyond. you're not going to believe this. see why they are talking space like nobody else. you got to stick around for this one. before the break, if someone asked john cusack to say anything today, he'd say i'm putting my prints on hollywood's walk of fame. "16 candles," "the sure thing," is going to make his reputation, shall we say, concrete on hollywood boulevard today. we'll be back in two minutes. what ? customers didn't like it. so why do banks do it ? hello ? hello ?! if your bank doesn't let you talk to a real person 24/7, you need an ally. hello ? ally bank. no nonsense. just people sense. whose non-stop day starts with back pain... and a choice. take advil now and maybe up to four in a day. or choose aleve and two pills for a day free of pain. way to go, coach. ♪ standard keyless access, and standard leather-trimmed seats, then your choice is obvious. the lexus es. it's complete luxury in a class full of compromises. see your lexus dealer. tree big stories from google today. it's rolling out its cloud base. pushing into a market dominated by the likes of drop box. jon fortt looking at what this means for google and rivals like drop box. >> it's an interesting setup. they're competing not only with drop box but ever note. ever note being a company that focuses on storing things in the cloud and allowing you to do optical character recognition so you can search receipts or other documents you take a photo of and put them in there. the thing i asked them, though, will they add the information on your files to the data base of things they know about you? they said, well, you know, we're not going to mix those two things together. i said, well, are you saying in your terms of service specifically that you're not going to let yourself mix those two things? they said, no, we're not saying that. trust us, we're not going to do it. i think this is going to test people's trust of google. now all your full-timiles, all bills, all that stuff. >> i thought part of what they were doing with google docs was exactly that. looking through and seeing key words in order to send me solicitations and ads that were based on things i might have written in one of my documents or e-mails. >> this is taking it to a whole new level. it's not just the documents you create in google docs. it could be any document on your pc you created with another program. things you've taken pictures of. places you've been. bringing all that together in a storage product that's a little different. up to this point people have been doing that with other companies. drop boxes, ever notes. it will interesting to see whether they -- >> my old high school classmate eric schmidt sat behind me in algebra class until they figured out he belonged in a different class. testifying today in that big case between google and larry ellison's oracle. what's going on? >> very interesting case. oracle trying to argue that google basically stole parts of java that they shouldn't have. google trying to make the argument java was really supposed to be free anyway. up to this point google has had a pretty difficult time on the stand. andy ruben was up earlier today before eric schmidt. now eric schmidt is up. it's coming out that sun microsystems which oracle bought which created java wasn't always so happy with the way google was using java. difficult road. eric schmidt -- >> worked at java, didn't he? did he work at sun? >> he did at one point. eric schmidt not always the most personable with your average db he has a way of saying things he probably wishes he could take back. it'll be interesting to see how this completely plays out. larry page didn't do himself too many favors on the stand. >> stay with us. we're going to break away and go over to brian shactman now. we'll come right back to you in a second. brian? >> twitter is a fascinating thing, tyler. it's been pointed out to me, i want to see an intraday of -- excuse me very much. microphone right here, guys. sorry. it fell off. bnny. annie's. ipo. take a look at the intraday chart. steven cone at sac capital trimmed their stake in annie's. that stock as the day has progressed has taken a big hit. again, still way up from its ipo price. definitely taking a hit in the middle of this day. back to you. >> thanks very much, brian. we're going to continue the conversation now on google. this story is really kind of incredible. eric schmidt, layry page and the hollywood director james cameron of "titanic" fame among those who are bankrolling a venture now to mine rare earth metals from asteroids that orbit near the earth. jane wells in los angeles listening in on a big meeting about it. jane? >> yeah. let me turn the speaker down here, tyler. notably -- we're watching the web cast live in seattle. this is eric anderson, cofounder of planetary resources. they want to get off the ground in the next couple years a company that sells low cost small robotic spacecraft. in the long term plan, to get on to asteroids. they say there are 1,500 near earth asteroids that have tens of billions of dollars worth of minerals on them. they think they could extract water from some of them. from that get hydrogen to have in space refueling stations. what we are not hearing yet is how much this is going to cost to get to that long-term goal and how much they've raised so far, tyler. >> very, very interesting. any reaction here, jon? i know what mine is. that is when you stray from your core business, you get your asteroid handed to you. >> that's funny. here's part of my reaction, tyler. when you look at this, google isn't the one putting the money into this. it really is page and schmidt. this used to be the sort of thing that governments did. self-driving cars. mining asteroids. you know, one of the spouses of the google founders is dealing with sequencing dna. it's really fascinating that we've got these multibillionaires who are now putting their money into this. >> jon, i think -- >> it might be the future of research. >> if anybody can do it james cameron can do it. >> google is putting up the $30 million for the google lunar kp prize. they haven't had to pay it out yet. they may never have to if none of these teams gets a rover to the moon. the company is behind that $30 million. >> thanks very much. all about apple after the bell. a little earlier we told you about the plays if apple hits. what about the play if apple misses the numbers? steve weiss of short hills capital and a cnbc contributor is with us. steve, what do you think? >> i think it's kind of obvious as we see it today. telephone came out. big t. reported a really good quarter. verizon good quarter. they benefit no matter whose phones they sell. actually benefit more if they sell cheaper phones where the subsidies are less. over 5% yields. it would be a mistake not to own these stocks regardless. >> there you go. two cheers for at&t and verizon. coming up, a stock to stay away from. we're talking about some of the biggest losers on the street. 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[ rodger ] at scottrade, seven dollar trades are just the start. our support teams are nearby, ready to help. it's no wonder so many investors are saying... all ] i'm with scottrade. but not how we get there. because in this business, there are no straight lines. only the twists and turns of an unpredictable industry. so the eighty-thousand employees at delta... must anticipate the unexpected. and never let the rules overrule common sense. this is how we tame the unwieldiness of air travel, until it's not just lines you see... it's the world. let's get you up to date on the markets. divergence between the dow jones industrial average and nasdaq. dow up 72.75 points. nasdaq turned negative by 15.5 points on the trading session. .5%. s&p 500 is up about .25% on the trading session. what did you pick for your chart of the day, ty? >> i picked when in doubt, go with netflix. the numbers not particularly good. guidance may be even worse. worse than that is netflix stock. down 14% at 87.42. steve? >> i went with two. navistar. beaten harder than an industrial rug. then xhb. the housing etf. housing stocks are ripping today. numbers continue to be poor. i think actually you want to sell the housing stock. discounting a full recovery.