get the blood tests. change your number. turn it up. androgel 1.62%. hi, everybody. happy monday to you. i'm maria bartiromo at the stock exchange. looking for direction to start the week. we're all waiting on earnings. >> yes, we are. i'm bill griffith. believe the headlines. get a flu shot. it's nasty. we're going to take you through the final hour of trading including more including the developing story you're hearing about regarding dell that it may be in talks with private equity firms. the stock has been surging but it's off the highs of now. up about 12%. more on that coming up. >> new data showing managed funds. plus the one thing that has him worried more than anything else. also stand by for two huge exclusive interviews heading your way. intercontinental exchange ceo jeffrey sprecher and then preet bharara will be with us as well. we've got a market at the highs of the afternoon with a gain of 25 points on the industrial average. a big boat load of bank earnings coming this week. waiting to see what it was. nasdaq negative as we approach the final stretch now. all of the best levels of the afternoon. it's been negative. s&p 500 looks like this. it's a similar chart pattern. even though we're still in the negative column for the standard & poor's. to the top story. is dell being boughtout? john? >> a report today said several banks have been contacted on the possibility of taking dell private. that accepted the stock up more than 11% with a market cap just shy of $20 billion. this would be an enormous deal. the underlying issue here, the pc ecosystem. dell was the poster child for the pc in the '90s. pc sales down in q3. and down again about 5% in q4. dell pcs were half of revenue last quarter. both laptops and desktops are shrinking. here's the difficulty. servers, networking, and services are the growth areas for dell along with dell's business selling its own storage technology. the company is trying to swing from being a low cost seller of commodity hardware into being a little bit more like ibm today. meanwhile the decline in public sector spending has already hit the company at the same time. mike o'dell had considered taking the company private. he never closed the door on that. but dell itself is saying no comment on this report today. i'm hearing from their side of things pointing out rumors pop up every once in awhile. not sure how much stock to put in it this time. >> what's the history of it, jon? because for a little while, michael dell stepped away. then he came back in. i feel like this idea of going private has been around for -- keeps coming back and forth. >> yeah. every time the stock seems to hit another low, it seems to pop up again. and michael dell himself never completely stepped away from the company even when you had someone else in the ceo spot, his office was right next to the ceo's office. he was very involved in the company. from my conversations with him, his passion for the company is still there. any move to break up the company wouldn't seem to line up with the conversations that i've had with him. so this report is a bit of a head scratcher for me. because they continue to need to grow through acquisition. and if they get larded on with a lot of debt, if they really leverage up at this point, hard to see whether start-ups would continue to want to be looked at by someone with dell when they have other options and directions they could go. >> thanks, jon. >> let's take it to the analysts. see if it makes sense to go private. with us is carl lanfear. and paul, what do you think? does it make sense for them to want to go private right now? >> -- because it has a strong balance sheet. it is underlevered. also generates a lot of free cash flow. $3.1 billion worth. and so it has a financial profile to support that. when it comes to private equity or venture capital, you'd have to have somebody that believes in the long-term trend. because this company is still a hardware company, i just don't see the vision there. >> what happens to shareholders once this company goes private? what kind of a pricing are we talking about in terms of the potential acquisition? >> that's a good question. you know, the stock's up 12% today. it's an unconfirmed rumor. obviously they would probably come in with a little bit more of a premium, but this is not going to be a deal that's going to be done anywhere near where this stock was once traded. >> carl, what do you think? does this make sense? i mean, with all the leverage it would take to get this company private again, you lose so much in flexibility if they want to be more flexible strategically. i mean, what's the upside of taking it private in fact if that's what they're thinking? >> well, i think dell has a pretty strong balance sheet relative to where it's been. and if you look at kind of the long-term potential, it tries to it will see a stronger profitability. it's been growing its acquisitions well. and 50% of their sales, it's becoming a smaller and smaller number. i think they're being unfairly punished for that. >> and do you think this is appropriate to want to take this firm private at this point? what do you think the benefit would be? >> we do think it's undervalued right now. and if if other people believe they would be able to continue sales at a comparable level to where they've been in the past two to three years, yeah, i think you can see some value there. >> paul, it's not been lost on us. hp also sharply higher perhaps adds we like to say in sympathy. what does that mean? why would hp go up if in fact dell's not talking to anybody else except some private equity firms? >> the interesting thing is hp probably has a better package of assets. even though it's depressed now, they still have printed which at various points in the cycle is the better business than what dell can come up with. more of a hardware-driven company. and also i think the stanford bernstein analyst commentary on your show last week is continuing to drive the stock. either the company no longer deteriorates import on activist shareholder comes in and forces changes to sell of these yesteryear assets. i think hp continues to go higher. i would prefer to own hp rather than dell. >> is it fair to say the best in class is apple and is eating everybody's lunch? hewlett, the pc business was rumored to be on the block for a bit. they rumored selling the business. now you've got dell going private. who else comes close to the monster leader in the business which is apple? >> well, i think apple -- it's a very good point. everybody is transitions to tablets and smart phones. vis-a-vis the high pc vendors. i expect that to continue. so these other guys that stay in the pc business, have to transition themselves more quickly than thought. the player everybody wants to emulate is ibm. go from being a hardware company to essentially dominated by software and services if that's what you like to do. >> or solutions as they like to say. >> sure. >> thanks for your insights. we'll keep following this through the hour. >> meanwhile, what does this mean for investors here? we have a market moving higher. the dow industrial average up about 30 points right now. in today's "closing bell" exchange, our friend who has been wildly bullish lately. jim bianoc and our own rick santelli. jim, i want to start with you. where do you -- you have some opinions on what deals like this if in fact there is a dealing in the offing for dell, what it says about where we are in the cycle for these markets. >> yeah. if you get a lot of deals like this like we saw in 2007, 2008, there's a high in the market when b you get a tremendous amount of deal activity. dell alone is not a tremendous amount of deal activity. but if it kicks off the activity, i would be worried ae tharkt is at a high. >> ralph, i want your opinions on the market here. when everybody was doom and gloom you said you wanted to be buying stocks. and you were right. this market wants to go higher even in the face of things like the debt ceiling debate and a global slowdown. if you had to call it a baseball game, what inning are we in? >> i'd say the second inning, third inning. there's a lot of left. >> wow. >> this is the year of all-time new highs? >> all-time new highs? >> as we speak. >> all-time new high for the nasdaq would be 5,000, right? >> i didn't say the nasdaq. >> okay. >> okay. so we have found the ceiling somewhere. >> it'd be fine. >> i asked our staff which chart you'd want to show to support your bullish stance and they showed me the russell 2,000. sthast where you're getting your bullishness right now? >> first of all, the dow jones is away from an all-time new high. the dow transportation index is less than 1% away from an all-time new high. when i see the secondaries as leaders, bill, that's the risk trade is back. i think that leadership suggests a lot more on the upside. >> so the secondary -- so-called secondaries are doing well. you think the blue chips will catch up with them and that's where we get the new highs then? >> well said. >> all right. >> what carries us? we know we've got dysfunction in washington, an anemic story for the global economy. then the free money on the sidelines thanks to the federal reserve and bankers globally. what sectors lead? >> check off all those boxes that you mentioned. last week we had a flow of funds for the first time in three years. back into equities. it was the largest amount in eleven years. there's trillions of dollars on the sidelines, maria. that's the fuel for my secular bull market. and leadership is definitely financials, health care, consumer staples, consumer discretionary, industrials. i just love the marvegt. >> you know, ralph, it's pisani, treasuries have had negative returns so far this year. maybe if this continues through the quarter and all of those get negative returns on their mutual fund reports for the first time in ages, they be that would be the catalyst. >> rick santelli, the time i was in the sick bed we had a wild ride for the treasuries. back to a midpoint range now. what are the markets telling you these days? >> i think i agree with jim bianco. if you look at a 20-year chart of dell, we haven't spent time over 20 since '08. we haven't spent time above $30 probably since '05. when i hear ralph talk about the second inning and maria talk about dysfunction in washington, here's what i hear. we have dysfunction in washington because we can't address our debt. when i look at ralph he's looking at trillions of dollars to fuel stocks. my question is why is it continuing to stay on the side lines? i think what dell is doing is hat in hand with what i'm seeing. we have easy money out there. turn you tillty into a company but you're not going to get $53 out of it like in 2000. >> jim, you have the most respected technical analyst with us telling us how wildly bullish he is. what does he have wrong right now? >> i don't know if it's wrong, i just don't share the enthusiasm for things he does. cash on though sidelines that's been there forever. it's still the story. last week's inflow in the stock funds. let's see if it lasts because it's being explained away as people pull forward their bonuses in 2012 for taxes. let's see if it lasts beyond that. earnings are slowing down. the economy is slowing down. and on the positive, you've got the fed pushing real hard. so maybe we don't have a big down in the market because of the fed, but the fundamentals beyond the fed are real hard to support the market going up. >> china's improving. japan is in uber-stimulus mode. a number of people have changed their gdp numbers this weekend 2.5%. it's not horrible and it's slowly improving. >> it is definitely tough out there. there's no argument there. final word very quickly, ralph. i just want to get your single best idea right here. if your scenario materializes and this market goes up, what's your best idea? where do you want to put your money today? >> xlf. financials. >> that's his financial sector there. >> yep. >> thanks, guys. >> we'll see you soon. thank you so much. we'll keep you updated on the dell story as it develops. we are in the final stretch of trading. 45 minutes until the closing bell sounds. more than 50% of cap managers underperformed the s&p 500 over the last five years and our next guest is not surprised at all. he is considered the father of index mutual funds. jack bogle joins us. plus how investors should handle the noise out of washington on the debt ceiling issue. then the ceo of the company that owns the stock exchange. up next with jeffrey sprecher. he will join me exclusively. also facebook has been red hot lately. tomorrow there's a big announcement. could it disappoint or ignite a bigger rally for the stock? coming up. [ male announcer ] you're not the type of person who sets goals and only hopes to achieve them. so you'll be happy to know that when it comes to your investment goals, northern trust uses award-winning expertise to lead you through an interactive investment process. adding precision to your portfolio construction by directly matching your assets and your risk preferences against your unique life goals. we call it goals driven investing. your life has a sense of purpose. shouldn't your investments? ♪ expertise matters. find it at northern trust. office superstore ink retailer in america. now get $6 back in staples rewards for every ink cartridge you recycle when you spend $50 on hp ink. staples. that was easy. welcome back. we're following a report that dell is considering selling itself to private equity. least get more from seema mody. >> that's right. no prize that dell is the best performing stock on the nasdaq 100. up about 14% on the day after report that private equity may be looking into buying the tech heavyweight. because of that report we're seeing stocks higher 14% on the day. we have calls out. we'll keep you updated on any future developments. back to you. >> thank you so much, seema mody. it's an age old fate. investors pulled close to $120 billion out of actively managed u.s. stock funds in 2012 making it the biggest yearly outflow since 2008. at the same time the inflow for exchange traded funds topped $30 billion. >> but you add this over the last five years, over 65% of large cap active managers lagged behind the performance of the s&p 500. no surprise to our next guest, our friend jack bogle of vanguard. the founder of the index fund and no stranger to this debate. great to see you. happy new year. >> same to you, bill. hi, maria. >> hi. >> all these exchange traded funds and everybody's getting into these passive management funds right now. are we at an extreme point in that regard, do you think? >> yes, i do think we are. there are a whole lot of -- i don't know -- i hate to say it, but a whole bunch of nut case etfs out there. it's the hottest marketing idea of the 21st century here and a lot of people jump on the bandwagon. but it is core. the flows in indexing are basically in the broad market funds. s&p 500, total u.s. stock market, told u.s. bond market and even total international developed and emerging markets. that's where the big flows are. there's a lot of game playing out there. they will come and they will go. believe me. they always have and they always will. but what we're seeing now, that's a marginal fringe element of it. we're seeing finally after all these years the real triumph of indexing. this is not a one-year phenomenon. and the last six years there's been about a $650 billion inflow in the index funds. $350 billion outflow. that's a $1 trillion swing in investors' preferences. that's a big swing. >> what are you -- i recognize it's really the triumph of the indexes, but what do you think the active managers are doing wrong? just lacking diversity? making the wrong bets? how come they so badly lagged the rest of the market? >> well, the essential reason for it is they lagged the market because they have to. these pools of capital and mutual funds are so huge, maybe 50%, 55% of the market, it's enormous. they can't outperform each other so they end up being average before cost and below average after cost. that's the math mettics, the rules of humble arithmetic. and those costs are higher than people expect. not only got the management fees, the operating expenses of a fund, they're explicit. some funds are highly priced. but there's also the trading cost. and the trading cost, the transaction cost, these portfolios turned over 100% a year. which is a lot to do with speculation and not very much to do with investing. >> is there no place then for -- in a person's individual portfolio for actively managed funds in your view? >> well, in reality i have to say there is no place. but there will always be managers that outperform, roughly offset by managers that are underperformed. that's just the math. so if you think you can pick a good manager, go try. but in my book the clash of the cultures, i show what people have forgotten in this business when you look at active managing. i've taken the eight largest of the modern era. there are eight of them, i think, in there. and they peak relative to the market and then they fall. every chart looks pretty much like this if you can see that little kind of mountain i'm drawing there. and when you get up here at the peak, the money pours in. and when you get down, it starts to ooze out. so investors in many respects are their own worst enemy. and it means paradoxically or ironically enough that while active managers don't do very well, their investors do even worse. >> jack, do fundamentals matter right now with the fed providing such free money all the time? do fundamentals matter? >> fundamentals matter forever, maria. but the fundamentals that really matter are really relative to the stock market are the two we know about and can rely on in some way to continue. dividend yields. it's around 2% today. earnings growth of corporate america. not each corporation, but corporate america which should be 4% to 5% over the next decade. if you add two to that, that's a 6% to 7% total return on stocks. the fed can disturb that. they can support the economy as they are now. they're building a pretty risky financial system with all that borrowing. i don't see how it could be other than substantial inflation down the road, but they could stave it off in a slower economy like this one. they could stave that basically inflation, huge inflation, off because the economy's weak. that's not going to happen forever. the economy will come back. >> all right, jack. always good to see you. thank you. >> good to talk to you both. >> we'll see you soon. jack bogle joining us on investing in this enormous amount of new money in the last couple months. coming up, the other side of that coin. who see a combined $17 billion. we'll explain why they think jack is wrong and active management is the best investors. stay with us. in the meantime with 35 minutes left in the trading session, i keep looking at that board thinking it's broken. the dow hasn't moved in the last half hour. it's up about 30 points now. will this trading floor survive? jeffrey sprecher with me in just a few minutes. stay with us. the only underarm treatment for low t. that's right, the one you apply to the underarm. axiron is not for use in women or anyone younger than 18. axiron can transfer to others through direct contact. women, especially those who are or who may become pregnant, and children should avoid contact where axiron is applied as unexpected signs of puberty in children or changes in body hair or increased acne in women may occur. report these signs and symptoms to your doctor if they occur. tell your doctor about all medical conditions and medications. do not use if you have prostate or breast cancer. serious side effects could include increased risk of prostate cancer; worsening prostate symptoms; decreased sperm count; ankle, feet, or body swelling; enlarged or painful breasts; problems breathing while sleeping; and blood clots in the legs. common side effects include skin redness or irritation where applied, increased red blood cell count, headache, diarrhea, vomiting, and increase in psa. see your doctor, and for a 30-day free trial, go to axiron.com. the battle of bataan, 1942. 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[ male announcer ] 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. you just heard the father of the index fund himself jack bogle say no individual investor should have a management in their portfolio. >> two disagree with him. they're here to defend their records. michael crofton and brad ardio. they have $17 billion in assets they have to put to work of other people's money. his point is your expenses are so high you have a much bigger line you have to cross to even make some money for your investors and make money for yourself. >> well, expenses are really only part of the game. one of the things that active managers do that mutual funds don't or index funds don't and even some of the index etfs don't is we manage risk. there's a tremendous amount of risk in this. if a client wants his risk managed there's only one way to do that. you see if you risk adjusted those returns, many active managers run their portfolios at lower betas because they want to participant in the market but don't want the risk. >> you manage risk. that's what you have to do particularly in today's environment where there is a fair amount of risk. let me ask you before we get into this dwe bait. how are you managing risk right now? how are you allocating capital? >> we're global managers so we have a broad spectrum where we can go now. we think overseas is advantageous rather than being in the u.s. close to the highs. yet the economy is -- the real economy is trading somewhat off its highs. if you look at europe, for example, where the headlines have been negative. the news flow has been awful. performance has been awful as well. so the market in europe has more reflected the performance of the real economy than it has here in the u.s. the fed qe program, the safe haven of the u.s. has caused money to flow to this part of the world. i think that leaves the u.s. a little pricier and perhaps more of a risk. >> it takes courage to fight the fed, though, right? >> absolutely. but ultimately and jack said it, fundamentals do matter. i think the market will reflect those. >> i heard active management does better in down markets than the index. they do better in the up markets. >> no question about it. and if you looked at the '08 to first quarter of '09 period, many people left them, haven't come back. god forbid we have another experience like that. then you'll see the index funds have a hard time recapturing the momentum. >> you see a blend of active and passive? >> i think so. passive is good. they don't anymore because they've come out with a new report on, you know, investing lump sums. but i think there is definitely room for both. initially maybe you start with funds and then you move into active management. >> all right. we'll leave it there. great to see you guys. thank you so much. appreciate it. we've got 30 minutes before the closing bell sounds for the day. coming up, we'll have more on these big moves in the spike in dell shares as well. that stock one of the most actively traded today. also another upgrade for facebook of all things. the stock is red hot up 40% in just the last couple months. is it time to do an about face and take profits at this point? plus what is this mystery announcement coming from the company tomorrow? supposed to be a big deal. we'll talk about that coming up. then remember this commercial? >> yes. in socialism the rich will be poorer. but the poor will also be poorer. >> people will lose interest in really working hard and creating jobs. >> interactive broker ceo tom peterfi spent millions of his own money to steer voters away from president obama. what does he have to say now that president obama won? he'll join us later on on the "closing bell." back in a moment. welcome back. rumors about what facebook is said to have announced tomorrow spreading like wildfire. but the company won't say what it is. it's a surprise announcement. julia boorstin on top of the story. >> i don't expect it to be a mobile phone handset, it does seem likely to have something to do with smart phones or tablets. including how much mark z zuckerberg has been talking about mobile. i do expect whatever they announce to have implications for revenue. facebook shares are pulling back a bit today ahead of tomorrow's mystery news, but between the invitation going out tuesday and end of trading on friday, the stock gained about 9%. and the stock has always been bolstered by a slew of upbeat analyst reports. deutsche bank upped its price target to 40 bucks saying the mobile news feed ads is a game changer. and oppenheimer raised on upside from facebook's ad exchange. piper jaffreys says he doesn't expect the announcement to be too major. but he says if the announcement turns out to be modest and the shares pull back on that, he does recommend that as a buying opportunity. now, bill, we'll have to see what the announcement is tomorrow. i will be there at facebook headquarters and will bring all the headlines. >> we look forward to it. thank you very much. it was a time to like facebook shares. let's talk numbers on that. with carter worth. and then zachary karabel. carter, it's had a good run lately. do you like it here? >> i'd fade it here. six weeks having jumped from 19 to 32. but in terms of a pattern. when your first day of life is your best day and you go straight down from there, that's never good. this stock on may 18th then monday the 21st plunged. right to where we've recovered now. some 750 million shares changed hands those days. people are trapped in the name who are interested in getting out. this stock has rallied to a difficult level. >> zach? >> there you go. good technical analysis but facebook isn't just a stock. it's a company. and it's a company with as we know a billion users and maybe 500 million of those have no idea what it is. that is still solely active dynamic users who are committed to this. they have a mobile strategy that is a ramped up more appreciably in response to necessity. while i would not say put your 401(k) money in facebook and don't pay attention to it for the next 30 years, i still think this is one of the more dynamic success stories the united states has produced in terms of new companies in the past five years. and we should continue to look at this as such. >> that's for sure. we can wait around for the mystery news tomorrow. >> never buy a stock based on mystery news. that i would say, if you're hoping that tomorrow is going to be a pop, definitely do not invest today. because it's much more likely to be a disappointment. but that's a one-day event. not a stock company story. >> two smart guys, two differing opinions. we love it when that happens. thank you, guys. see you later. we've got about 20 minutes before the closing bell sounds for the day. the dow industrials up about 14 points. up next he may have a passion for mechanical watches, but jeffrey sprecher founded one of the world's largest electronic trading exchanges. what will happen to traders on the floor of nyc if intercontinental exchange is successful in their next move. we'll talk with jeffrey sprecher exclusively. back in a moment. tdd#: 1-800-345-2550 when i'm trading, i'm totally focused. tdd#: 1-800-345-2550 tdd#: 1-800-345-2550 and the streetsmart edge trading platform from charles schwab... tdd#: 1-800-345-2550 gives me tools that help me find opportunities more easily. tdd#: 1-800-345-2550 i can even access it from the cloud and trade on any computer. tdd#: 1-800-345-2550 and with schwab mobile, tdd#: 1-800-345-2550 i can focus on trading anyplace, anytime. tdd#: 1-800-345-2550 until i choose to focus on something else. tdd#: 1-800-345-2550 all this with no trade minimums. tdd#: 1-800-345-2550 and only $8.95 a trade. tdd#: 1-800-345-2550 open an account with a $50,000 deposit, tdd#: 1-800-345-2550 and get 6 months commission-free trades. tdd#: 1-800-345-2550 call 1-866-294-5412. nothing. are you stealing our daughter's school supplies and taking them to work? 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[ male announcer ] the spark business card from capital one. choose unlimited rewards with 2% cash back or double miles on every purchase, every day! what's in your wallet? or double miles on every purchase, every day! we asked total strangers to watch it for us. thank you so much. i appreciate it. i'll be right back. they didn't take a dime. how much in fees does your bank take to watch your money? if your bank takes more money than a stranger, you need an ally. ally bank. your money needs an ally. announcing it would acquire for $8.2 billion. since ice is an electronic exchange, many asking what this means to them and floor trading overall. joining me exclusively intercontinental exchange's man in charge, ceo jeff sprecher. before we get into the changes you're going to make, why are you looking to acquire nyse? >> nyse has built a big exchange and we have built a commodity exchange. putting it together -- we think that we can offer the global clients a bigger portfolio of things to trade. >> i'm glad you said that. i was looking at the differences in the exchange saying your brand is largely commodities. you've got obviously coffee, sugar, cocoa. you've got all the commodities everybody trades in an active business. and the exchange is cash, it's life, it's derivatives. where are the revenue synergies? or is it operating synergies where you can cut? >> well, we justified the deal to the capital markets by talking about how we can combine and take costs out of the business. but the reality is the reason duncan and i decided to get together is we believe we can grow the top line of this company. you have a trend going on in the world now where more and more over the counter markets and unlisted businesses are coming to the exchanges due to dodd frank and that similar kind of legislation going through europe and asia. and we want to position ourselves in the financial area where we can be the beneficiaries of that movement. >> so in terms of revenue synergies that's the point. you don't want a lot of overlap. >> that's exactly right. and we've seen in our industry particularly and nyse specifically it's been hard to put these mergers together. if you look at our two businesses as we sit here today, we have no overlap which we think will help put the businesses together. >> putting those together in terms of operating and where the overlap is. what kind of cost cuts can you manage? what do you think the opportunity is there? >> well, for us we'll have two networks we can go down to one. we'll have data centers we can combine. so there's a lot of just stuff incumbent that we can take off. that is the cost cutting that will help justify the deal. the reason we want to do the deal is for the reason of movement of more business particularly in the otc area that we think is going to come into the exchange listed venue. >> and that's really where the money is. the derivative businesses. >> we hope so. >> what would you do with the listing business? are you expecting it to be spun off? sold? >> no. in fact, as i started looking at the new york stock exchange which was a company we knew by reputation, we found a good business here. the listings business is doing well, and the trading business is doing well. because of all the need for data and technical services that are now embodied around exchange. there's a good franchise in here. the other interesting thing i saw, duncan and i happen to be negotiating this deal when hurricane sandy came through. and we were on phone calls with the industry trying to figure out what to do. and there were hundreds of companies on big conference lines. and really the industry uturned to duncan and said is the new york stock exchange going to open? as a small business entrepreneur which is how i think of myself, i saw the power of this brand in a moment of crisis. and i said that's something you should own. >> you're absolutely right. that morning or that night when we learned that the exchange had closed, i was shocked. i said to myself this is an electronic world. i don't understand why we have to close down trading in the company. so would you have stayed open given that -- >> yes. but what was interesting is that in the equities business, it's gotten so fragments. all the things that led to the flash crash and the networks that have hooked together, the market wants human beings. the market relies on human beings. it was people in this building that saw the night capital trading engine run away. they were the ones that saw it and said something's amiss. the market realizes now that technology alone isn't going to solve the problems. you've got to have the human touch. and just not being able to have these people, these professionals on the day that hurricane sandy was coming through was enough to actually close all the wall street including the bond markets and ultimately my markets. i think there's more than sym l symboli symbolism. >> that's the thing. if we're operating in an electronic world you would think business can go on if the people on the floor couldn't get here or be here. what about the floor? a lot of traders on the floor know you're on the show. are you going to do away with the floor? >> they seem to be smiling, by the way. i hope you've said good things to them. yeah, i mean, i think b that fact alone means we should embrace this model and figure out how to exploit it. if wall street wants human beings involved, we've got to figure out how to have them involved. you can see there's more and more technology into the exchange. you've got to have humans interfacing with that technology. we've gone too far where there's computers trading with computers and there's nobody watching. >> when you look at your past deals, you could look at the international petroleum floor in london. you closed that. the new york board of trade you acquired. you eliminated that floor. you even changed the name. should we expect this exchange down here is going to be more electronic than we've ever seen? >> yeah. what happened in those circumstances, the market moved all the volume off the floor on to the screen. >> yes. my apologies. this is not personal. you're going where the business is. >> i don't take it personally. but that did not happen here. years ago archipelago emerged to become more electronic. but the market has kept this floor here and there is is reason. the business has gotten too complicated. and people want human beings involved. so i say celebrate it. i'm an entrepreneur and i say this is something unique. make sure people send their orders here. >> the overall name of the firm is what? >> well, i.c.e. is the acquirer of all these companies, but underneath that we have more than a dozen exchanges and clearinghouses that all have their own regulators, their own boards, their own brands. and we're going to keep all of those because they're strong brands in the markets that they serve. what we do with the holding company is actually probably not even relevant. >> it's sort of like the new york stock exchange, an i.c.e. company. >> we haven't thought about that yet because it's a detail we don't care about, but i know it's symbolic to a lot of people on the floor so we're thinking what should we do? >> is there an issue with all those other exchanges? you've got all these nationalistic exchanges that they're governed by in their country. are you going to package them? >> so one of the things that duncan and i talked about when we put this deal together is should we spin out part of the european exchanges? the reason is europe is going through a banking consolidation and a regulatory consolidation. all of this talk about the euro is bringing the financial markets together. nyse owns four large exchanges in europe. the question is how do we bring this into this consolidation? one way may be to take them public so they can have their own currency and do deals. >> we'll leave it there. so much to talk about. i wanted to get your take about the individual and what's happening in capital market these days. seems like everything is strained. but that conversation for another day. good to have you on the program. >> thank you, maria. >> best of luck with the deal. >> thank you. >> jeff sprecher joining us. ceo at i.c.e. pmt. ten minutes before the close. up next as if apple didn't have enough problems, now the company's iphone may no longer be considered cool for young people. that could be bad news for apple. we're going to take a look. then preet bharara is here. remember this from last year's conference? >> i know you told me there were going to be a lot of people here from the hedge fund industry and other folks, i didn't appreciate how many people so i wanted to apologize in advance that i don't have enough subpoenas for all of you. >> well, that may have been a joke, but the so-called sheriff of wall street is continuing his war on hedge funds. now he's focusing on something else as well. he'll join me exclusively. a lot more coming up on "closing bell." [ male announcer ] here's a word that could give you peace of mind. unbiased. some brokerage firms are. but way too many aren't. some of the ones that push mutual funds with their names on them -- aren't. why? because selling their funds makes them more money. which makes you wonder -- isn't that a conflict? am i in the best fund for me, or them? search "proprietary mutual funds". yikes, it's best for them. then go to e-trade. we've got over 8,000 mutual funds and not one of them has our name on it. why? because that's not the business we're in. we're in the business of finding the right investments for you. e-trade. less for us. more for you. ♪ [ male announcer ] don't just reject convention. drown it out. introducing the all-new 2013 lexus ls f sport. an entirely new pursuit. welcome back. apple fell below $500 for the first time in nearly a year today. seema mody at the nasdaq has details. >> that's right. shares of apple under pressure. if you haven't caught the reason, here it is. there's a report saying apple is slashing orders for component parts of the iphone 5. that's raising fear on the street of the future demand for the iphone 5. analysts coming out today and defending apple saying this is old news. shares nonetheless still down on the day. another interesting report that's been catching the attention of wall street is whether the apple iphone is losing its cool factor among teens. one of the reasons mentioned in the report is that back in the day not too many people had an iphone. now everyone from your mom to your science teacher has an iphone. perhaps that's why it's losing its charm among teens. bill and maria? >> you watch. the blackberry will make a comeback. thank you, seema. we're coming back with the closing countdown. the dow losing steam now only up four points. now we have zombie homes. people who thought their home was foreclosed on still own the home and they didn't know it. incredible story. stay with us. ' ♪ you know my heart burns for you... ♪ i'm up next, but now i'm singing the heartburn blues. hold on, prilosec isn't for fast relief. cue up alka-seltzer. it stops heartburn fast. ♪ oh what a relief it is! ♪ [ male announcer ] this is karen and jeremiah. they don't know it yet, but they're gonna fall in love, get married, have a couple of kids, [ children laughing ] move to the country, and live a long, happy life together where they almost never fight about money. [ dog barks ] because right after they get married, they'll find some retirement people who are paid on salary, not commission. they'll get straightforward guidance and be able to focus on other things, like each other, which isn't rocket science. it's just common sense. from td ameritrade. . into the last minutes of the trade here, we have lost some ground here. teledow was up 50 points. but now just 11. the word is out dell is talking to one, maybe two private equity firms about taking the company private. no comment from dell on that. we'll talk to some analysts about that next hour. but it's up about 13% right now at $12.28, a level it hasn't seen in quite a while. matt

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