ALEXIS GLICK, FBN HOST: Coming up this morning on MONEY FOR BREAKFAST, day one of General Motors bankruptcy getting underway as the company announcing the sale of the Hummer brand. GM's Vice Chairman Bob Lutz joins us live in moments.

And the debate over President Obama's potential $1 trillion plus overhaul of the nation's healthcare system kicks off on Capitol Hill today.

And as our look at the growing red ink, thanks to government spending continues we see who is actually footing the bill for the surgery on healthcare.

And video game sales slumping but Microsoft thinks they have an answer with a little help from some friends. Shane Kim, Vice President of Microsoft's Xbox 360 is going to join us live from the E3 conference in Los Angeles.

We're serving these stories and much more this morning on MONEY FOR BREAKFAST.

Good morning and welcome to MONEY FOR BREAKFAST. I'm Alexis Glick.

It's the day after GM filed for Chapter 11 Bankruptcy Protection. We're live at the New York Bankruptcy Court for a look at what will happen today.

GM's Vice Chairman, Bob Lutz, will join us shortly. He'll tell us about the reorganization. We'll ask what he would say to GM customers to get them in the door as this bankruptcy process begins.

And later in the hour, the Canadian Minister of Industry Tony Clement is going to join us to discuss his country's role in GM's future.

But first, let's get a look at the markets as we had a nice day on Wall Street yesterday. And we're in the green again today, just slightly. The DOW up 10 points, S&P up two, NASDAQ up four; so the good news is the green continues.

All right, let's get a check of the markets. Ashley Webster is in London. Connell McShane is back from GM's headquarters and that press conference yesterday. Great job Connell.

CONNELL MCSHANE, FBN CORRESPONDENT: Thank you.

GLICK: And now, let's start with you here in New York.

MCSHANE: All right, good morning Alexis. Thanks very much.

Now, we are looking at these markets, as you say we have turned higher on the futures. We were lower earlier this morning, it's worth pointing up; we were up five and a half percent or thereabouts on the S&P 500 in the last three days. Nice little rally.

As we look at what's going to happen today. We have our eye on some of the banking stocks as JPMorgan and American Express going out and raising some money in capital markets. For JPMorgan it's $5 billion to satisfy the requirements for the government looking to pay back TARP money. See the stock indicated lower at pre-market 35.90 from 36.11.

American Express, an equity offering of $500 million and that will also be a stock to watch today; closed around 26 and it's down to 25 and change. Dilutive measures on both counts. Both stocks moving lower this morning.

Finally Devry, the education company is really going to be a stock to watch today as well. It is the company taking the place of General Motors in the S&P 500 index. With that announcement after the close last night, Devry 44.37 at the close shot up by about five percent from that level. We'll see where it goes. No pre-market action as of yet on DV.

Now, let's head over to Ashley in London standing by with a look at the overseas trading -- Ashley.

ASHLEY WEBSTER, FBN OVERSEAS MARKETS EDITOR: All right Connell, thank you very much. After a strong day of trading yesterday and of course several days of strong trading, the European markets taking somewhat of a breather today, maybe taking a few profits really just catching their breath.

Let's take a look at the latest numbers for you here in London, the FTSE 100 down about half a percent. We are off of our morning lows. Meanwhile in Paris on the CAC-40 also flat, right about flat for now. And in Germany on the DAX 30 index trying desperately to stay on the positive side, up about two to three points.

Meanwhile, Barclays -- this is the story we've been following all morning - - Barclays confirming that the International Petroleum Investment Company is selling 1.3 billion of the U.K. Bank shares that it acquired last year. But Barclays says it is still aiming to develop ties with its Persian Gulf investors.

IPIC was one of a group of investors who took $10 billion worth of Barclays shares in a move frankly that upset existing shareholders but helped the U.K. bank side step government interventions; now those shares being dumped. Barclays shares in London down more than 14 percent on the news.

Irish airline, RyanAir, that's Europe's largest discount carrier is reporting its first annual loss. Its fuel bills took off and the airline had to further write down the value of a stake it has in Irish competitor Air Lingus, tough days for the airlines. RyanAir shares down about one percent as we speak.

So we are trying to keep positive but really just taking a breather.

Let's go back to Alexis Glick. Not a bad idea Alexis; back to you in New York.

GLICK: Oh, yes let's take a breather on a Tuesday. If only it was Thursday or Friday. Yes, all right Ashley, thank so much.

Well the wheels are rolling forward for GM which enters day one of its new era after filing for bankruptcy yesterday. This new day will see the loss of an old friend for GM.

Fox Business has learned that GM has reached an agreement to sell its Hummer brand the first of many expected changes. Fox Business's Adam Shapiro is live at the New York Bankruptcy Court with more on this historic filing. Good morning, Adam.

ADAM SHAPIRO, FBN CORRESPONDENT: Good morning Alexis, they haven't identified who the potential buyer is going to be but what we do know from General Motors is that this deal to sell Hummer could save up to 3,000 jobs here in the United States.

They build Hummer in two different locations. You've got the H-3 which is the smaller Hummer which is built in Shreveport. It's actually built on the -- I think it's the Colorado Chassis or platform. So that will continue to be built in Shreveport, Louisiana up until 2010 under a contract with General Motors for the potential buyer to produce those vehicles.

The larger H-2 Hummer is made in Mishawaka, Indiana. And that production would obviously continue that through a contract with AM General.

So Hummer is potentially going to be sold with 3,000 jobs being saved.

We spoke with Fritz Henderson yesterday after the hearings -- at least the first day hearing here in Manhattan. And we asked him specifically if he was worried that different Congressmen out to protect plants in their different districts might slow down the reorganization. And here's what he had to say.

(BEGIN VIDEO CLIP)

FRITZ HENDERSON, GENERAL MOTORS CEO: Well, I mean, the Congress has a role to play, but this is a process that is played out in a Bankruptcy Court. We have the support of the principal creditors. We have the support of the U.S. Treasury to basically finance the acquisition, not only the U.S. Treasury but the government of Ontario, the government of Canada. And so I mean I think our job is to move quickly.

(END VIDEO CLIP)

SHAPIRO: And here is how quickly things are going to move. Already a hearing date has been set. Several dates set with things coming up as soon as tomorrow.

First on June 3rd, Wednesday, there's -- an organizational committee is going to hold its first meeting it's going to form actually. There's also a meeting for the creditors that's coming up. That will take place in Midtown on 53rd Street tomorrow.

June 19th objections to the sale are due because again they're going to go for that 363 sale, so anybody objecting to it has to file by the 19th. The deadline -- big deadline, those who might want to try and purchase General Motors on their own would be on June 22nd as is in the Chrysler case nobody came forward other than Fiat. And in this case they expect that auto acquisition corporation which would be the new General Motors will be the only bidder.

And then, on June 30th a hearing will be held for the actual sale of General Motors' good assets to what will become the new General Motors and eventually leave the rest of the company here to die in Bankruptcy Court.

That's the latest. We're waiting for people to start filing their motions objecting to what's happening. But yesterday, crucial hurdles passed allowing General Motors to pay its suppliers as well as its employees.

Back to you, Alexis.

GLICK: All right Adam, thank you very much.

Well, with a closer look at how GM plans to get through bankruptcy and emerge a viable company, Bob Lutz the Vice Chairman of General Motors joins us this morning. Good morning, Bob. Good to see you.

ROBERT LUTZ, GENERAL MOTORS VICE CHAIRMAN: Good morning, Alexis.[...]

GLICK: All right. It's got to be a very, very tough day for you. Who knew it would come to this. What does it feel like now knowing that General Motors is under bankruptcy protection?

LUTZ: Well, you know, we've been seeing this event coming for some time and have been planning for it. It takes weeks and weeks to plan for a restructuring like this. So to us it's the logical outcome of something we expected.

Meanwhile, we're hard at work especially in my area in product development. As you know, we've got some absolutely fabulous products out there, a lot more in the pipeline. And we just -- we'll just continue to produce superior products.

And as the federal government has said, the warranties are protected. And we just hope that a lot of people will come in and look at our vehicles because they're absolutely outstanding. And we're very confident of being able to get through this.

We will leave all of our bad legacy cost behind, all of the things that have been basically dragging the corporation down the last 15 or 20 years. We're going to emerge, hopefully, as fast as possible as a much leaner, much fitter company but with the same operational excellence in terms of manufacturing and product development that we've demonstrated over the last five or six years.

GLICK: Bob, let me touch on two of the points that you made there. One is those legacy costs that have been burdening the company. You, yourself, have said listen the healthcare benefits associated with the contracts with the UAW costs this company $100 billion over 15 years.

Do you believe that the kinds of deals -- deals that were created with the UAW will give this company the opportunity to be viable in the future knowing that the pension is under funded by about $12 billion to $13 billion?

LUTZ: Yes, I really do.

I think we're now finally going to be looking at a level playing field versus international competition because the healthcare costs will be all but gone.

The so-called VEBA that we were going to have to fund has now been given to the UAW in the form of equity. They will over time have to sell that equity down in order to fund their healthcare costs.

And one of the requirements of the administration to fund GM in bankruptcy was that we had to achieve and absent a fully internationally competitive labor costs. And we believe that working together with our partners in the UAW, we've achieved that.

And then the other element that is usually forgotten is that we were fighting for about the last 20 to 25 years with an exchange rate, a relatively strong dollar and weak Asian currencies which greatly favored our Asian competitors from a cost standpoint.

And I don't know, that was done in the name of free trade, and everybody has access to the U.S. market. Even Lee Iacocca used to complain about that 20 years ago. And that has finally gone away at least for now.

We have a weaker dollar and stronger Asian currency. And it's going to frankly make it a lot tougher for our Asian competitors, but hey, if you want a viable -- yes go ahead.

GLICK: Bob, I was just going to interject here. I mean, there's two issues though. And you talked about this the other day at the Automotive Press Association.

That is you know you have a credibility issue right now. So does the United States frankly, about the level of the government size or stake in the likes of GM and frankly of Chrysler.

How do you convince not only the American public who are the vast majority have been against this -- this restructuring and this bailout but also the international consumer that this is the right place to purchase a vehicle?

LUTZ: Well, the right place to purchase a vehicle for the customer is where the customer gets the best deal. And I think if you look at the award-winning products that we've won Car of the Year or Truck of the Year with just about everything we've brought out over the last couple of years. And I think we can honestly say we have the best product line right now in General Motors history; certainly maybe the most competitive in the world.

So that's the -- that is the number one reason for the customer to give us consideration.

Now, as far as government involvement is concerned, you know, the government -- people say well why didn't they just give you loans?

Well, giving us that amount of money in the form of loans would have triggered very, very substantial interest expense, and that's what we're trying to get rid of. We're trying to get a balance sheet that's mostly equity and very little debt because our debt servicing costs were one of the things that was killing us too. So by giving us equity, the government has really found a very cost effective way of giving us the money.

Now, I absolutely believe President Obama and his administration when they say they have no interest in running the business. They are simply providers of money. And sure -- their prime interest is to get their money back out. They do not want to be in the car business.

GLICK: It's interesting, Bob, because you have been one of the most colorful executives in this industry. You've worked at Ford and you've worked at Chrysler and you've worked at GM.

And one of the things you talked about several months ago when you decided that you were going to eventually retire is you talked about the new role of regulation. The level of government intervention that perhaps vehicles will not be made because somebody like you who gets passionate about the vehicle, but perhaps they'll be made because of regulatory constraints. For example, CAFE Standards -- are you not concerned that the intervention here may mean that the thing you have been so passionately an advocate of for your entire career, which is selling cars that people love will no longer be the top priority?

LUTZ: Yes, Alexis, you know, it looked a little bit like that right around December and January, between the Bush administration and the Obama administration. We were talking about basically regulation without representation. And there was a lot of talk from the Obama camp before the president got elected that 35 miles per gallon is not enough. We're going to go for 50 miles per gallon. And frankly it was a pretty depressing scene.

But ever since I've had the opportunity to actually interact with the government automotive task force, during the weeks and weeks that they were gathering information here, I found that these are very, very reasonable, very intelligent people, very much focused on making General Motors successful. There is no ideology expressed here, "You know, we're going to make you produce nothing but small econo-boxes that get 40 miles per gallon." There was absolutely none of that.

In fact the federal fuel economy mandates we have now there was a lot of beneficial interaction and interchange of thinking between the automobile industry and the Obama administration to where we actually got some adjustments to the way that the fuel economy is measured, which types of vehicles have to gain, how much, and so forth, which frankly has helped us achieve a realistic set of regulations to where we will be absolutely capable of manufacturing the broad array of products that we make today including full-sized pickup trucks. We will be able to continue to produce the types of vehicles that Americans want.

GLICK: Let me ask you this, Bob, one of the chief concerns with all the automotive analysts that I talk to is the run rate right now is about 9.3 million vehicles. As you know, many of these dealers who either face the fact that they are going to be going out of business are selling cars on some lots at record low prices. Residual values are declining as a result.

The question everybody is asking is, how will you create either one, the necessary demand going into next year, or number two, the appetite to pay something like $40,000 for a Chevy Volt when you can get a Pontiac off a lot for $15,000; $20,000?

LUTZ: Well, there's naturally an adjustment. Right now we're looking at an oversupply situation. We have got Pontiac going out, Saab going out, and so forth. And there will be some discounting there as dealers clear the lots. But over time we do not expect the industry to remain at this sort of 9.3, 9.5 million.

We're shooting for a break-even point for General Motors of basically a $10 million industry. Right now, you know, replacement demand is about 13 million. So right now we are producing and selling vehicles in this country below the scrappage rate. Plus the fact there's two million new drivers coming into the market every year.

So ultimately unless we have an economic development that's far worse than what we think we're looking at now, the industry is going to recover to at least replacement demand. And I don't know, we're looking at next year, 2010, as being the beginning of a very mild recovery.[...]

Will we ever see 16 or 17 million units a year again? Most likely not. But with the way we have cut our costs, we will be able to survive and prosper very nicely at levels significantly below that.

GLICK: So Bob, explain to me the shroud of secrecy around Hummer. Can you tell us if it's a public company, a private equity shop, why is this being held behind closed doors?

LUTZ: I can't answer why it's being held behind closed doors. Presumably because the buyer does not want the identity known before we finalize the deal.

But we do have a memorandum of understanding with the buyer. We have agreed on all the terms and conditions. We are going to finalize it. We hope to get it done by the end of the third quarter. But we can't announce who it is today.

GLICK: so does it stay out of the bankruptcy process in general, or does it not get unveiled through the bankruptcy process?

LUTZ: No, this will not be -- this will not be upset by the bankruptcy process.

GLICK: Bob, you know, all these years in this industry, a veteran of it, you see where we are today, we have Chrysler and General Motors in bankruptcy. You have Ford who has been losing billions and billions of dollars. Was this just a long time coming, that the industry needed a restructuring?

LUTZ: Yes, absolutely because this industry has been around for a long time. In the case of General Motors, 100 years; Ford even slightly longer than 100 years. We have accumulated enormous baggage in terms of labor costs that were higher than was generally the rule for competition, and that came from the 50s and 60s when the U.S. industry was absolutely dominant and even into the 70s when we could easily afford to pay these higher wages and benefits and very generous pensions, very, very generous healthcare so that when international competition started coming on including the Japanese being heavily advantaged by a weak yen, we were forced into a retrenchment mode.

And as we shrank -- as we continually shrank over the last 20 to 25 years, our active work force reduced in size but the retirees increased in size.

When I joined GM -- rejoined in 2001, we had 3 retirees for every active worker. Today, it's 10 retirees for every active worker. Without this radical restructuring, there's no way we could deal with that.

Meanwhile you had our transplant competitors down south, non-unionized workforce, a very, very young workforce, no retirees, no healthcare costs.

GLICK: Right.

LUTZ: Meanwhile, we're up north with a 3 to 1 going to 10 to 1 ratio of retirees to active, massive healthcare costs as you pointed out $103 billion in the last 15 years. That's money that otherwise could have gone into profitability, new product development, you name it, but it was -- we were just absolutely -- we were like trying to run a marathon with ten pound weights strapped to our legs.

Sooner or later, if the economy had stayed strong and we would have had the industry continuing...

GLICK: You would have had to deal with it no matter what.

LUTZ: ...we might have gotten through with it, but I tell you what, the first time we would have had a sharp recession, all of this undeniably would have happened. We simply were carrying a cost structure that was ok for the 1950s and ok for the 1960s, but given where the rest of the world is in terms of wage rates and competitiveness and national healthcare, we were not able to compete in a down market.

It's as simple as that.

And the restructuring was absolutely necessary. I hate it. I personally lost a lot of money in it that I had a portion of my net worth in GM stock. That's all gone. No point crying over spilt milk.

But I will tell you, the fact that General Motors can start its next hundred years with an outstanding product line, excellent operational capability, and with a clean balance sheet, and with vastly reduced costs...

GLICK: A new start.

LUTZ: I think it's very, very promising for -- it's a new start.

Again, I want to disabuse people of this notion that the federal government is going to meddle and make us build economy cars that the public doesn't want. That is not going to happen. We're going to be...

GLICK: Bob...

LUTZ: ...sorry, Alexis...

GLICK: This is why people like you. Because you just call them as you see them.

All right, Bob Lutz, as always. Thank you very much for taking the time.

LUTZ: Thanks, Alexis.

GLICK: And obviously -- hopefully we'll talk to you throughout the rest of the bankruptcy restructuring process.

Guys, we will take a quick break. We will be right back with much more in just a moment.

(COMMERCIAL BREAK)

JENNA LEE, FBN CORRESPONDENT: Welcome back everyone to MONEY FOR BREAKFAST. I'm Jenna Lee with a quick look at this morning's top news stories.

We're going to continue to watch this story developing out of this Air France flight. Search planes are scouring the Atlantic looking for remains of this Air France jetliner that somehow disappeared off the coast of Brazil. The United States has agreed to help locate the crash site using satellite data. The plane vanished after flying into thunderstorms and sending an automated message that the electrical system had failed.

We heard about this first thing yesterday morning; 228 people were on board. We will continue to watch the developments there for you.

In the meantime, South Korean media reports North Korean leader Kim Jong- Il's replacement has been chosen. It is his youngest son, 26-year-old Kim Jong-Un who will be the country's next leader. Now, reports are the decision was made after North Korea's missile tests on May 25th. In the meantime, North Korea is reportedly prepared to test fire a medium range missile from the southeastern part of the country.

And Treasury Secretary Tim Geithner, wrapping up his trip to China; Geithner telling Chinese state television this morning the White House is doing everything it can to restore confidence in the American markets. He has assured the Chinese leaders that cooperation between the U.S. and China are beginning to show signs of global economic stabilization, and the U.S. and China plan to have additional high level talks at the end of the July.

You are up-to-date here on the Fox Business Network.

Coming up, the once booming video game industry is seeing a sales slump. Shane Kim, he's the vice president of Microsoft's Xbox 360 tells us how his company is battling back.

What is Canada getting out of their $9.5 billion investment in GM? We're going to ask the Canadian Minister of Industry Tony Clement when MONEY FOR BREAKFAST returns.

(COMMERCIAL BREAK)

GLICK: Calling all gamers, the $22 billion video game industry kicks off its biggest trade show in Los Angeles today. Fox Business's Shibani Joshi has more on this year's exciting new products.

Good morning, Shibani.

SHIBANI JOSHI, FBN CORRESPONDENT: Are you a gamer Alexis?

GLICK: I'm not, but I have a household full of gamers.

JOSHI: Of course. There are a lot of people out there that are in the same boat. I'm not a big gamer but I at least have friends who are gamers. That's all you need. You need one friend.

GLICK: Exactly, with their console out there.

JOSHI: But it's certainly going to be gamers' galore at the Electronic Entertainment Expo better known as the E3 conference which as you said starts in Los Angeles today. The video game industry hopes the conference will build the buzz for the newest systems in games which could frankly use a boost in sales.

Two months ago hardware and accessory sales came in just over $1 billion which sounds great, but it actually slid 17 percent from the previous year.

Now, so far Microsoft is stealing the pre-conference show unveiling the new Nadal for the Xbox 360. The Nadal allows game users to do a lot of things including using body and voice controls rather than using the traditional hand-held controllers. The Xbox is considered to be the biggest rival to the Nintendo WII.

And it's going to be battle of the bands for the game publishers this fall. The Beatles: Rock Band by Harmonex makes its world-wide debut on September 9th. But not to be outdone Activision's Guitar Hero 5 will hit stores just one week earlier. Activision is also getting pretty great reviews so far for its Tony Hawk Ride Game with Citigroup saying quote, "it's hard not to get excited."

A lot of developments coming out of Los Angeles. Louis Pennell (ph) of course, is going to be there and we're going to be talking to the Xbox executive in not too long. So, lots to look forward to.[...]

GLICK: Exactly. A lot to get excited about.

Shibani thanks so much.

Later in the hour, as we just mentioned Shane Kim is who I will be speaking to from Xbox 360.

Now it's time for Mr. Charles Payne to give us "Charles's Choice" -- Charles?

CHARLES PAYNE, FBN CONTRIBUTOR: Good morning, Alexis.

You know, the first stock I'm going to do is not exactly a choice. In fact, I'm trying -- I want to help people manage their trades now. A lot of people are up -- these "Charles's Choices" have been kicking butt.

As you can see, I recommended this stock January 20th at 129, Baidu. I've had it on a few times but it closed yesterday at $286. How do you manage a trade like this? This stock is interesting because it's making a clear channel to the upside.

Now, there are two things it can do. Normally, with a normal stock I would take a previous peak and use that as a support right here that would be $255 but because this is a high beta stock which means it gyrates a lot, any stock with a beta over 1 is high beta, this has a beta over 2.

I would suggest maybe a stop down here -- sorry about that. A stop a little bit down here, a little bit lower maybe right around 240. But if you bought it at 129 and you had to sell at 240, it is still a significant gain. That's how you ride out these stocks.

But again, every chart is different. A lot of charts though right now, look just like this from March. If you are in them, form chart, form a channel, the way I did and consider where you may want to take profits because the worst thing to do is have a big gain turn into a loss.

Now let's look at a couple of fresh ideas. Titanium Metals the metal space is really getting pretty hot here. We can see where this stock is starting to trend up real, real nicely, also on the verge of breakout; actually breaking through 10. Ten is always a big round number. For some reason it gets the Street is excited.

Metals were exciting yesterday. The volume was up on this real nice. I think you have a couple of places you can look to make money. Right there, 12 bucks would be a nice percentage trade, but also the stock you get up to 14, 40 percent not bad.

And also, China is real hot right now. China Battery -- China BAK Battery is a stock that, you know what? It took a heck of a dive here recently, but by the same token, it is making a big move here now. Also, on the cusp of a major breakout. This has a large following amongst the momentum crowd. Obviously it is a high risk play, but you can make a lot of money in a short period of time if this one breaks out.

Also on our Web site today, foxbusiness.com/moneyforbreakfast. I have two ideas for you. Make sure you go and check them out.

If this market breaks out, folks, you want to be in it. I keep saying that. Alexis I keep telling people, you don't have to believe in the economy, I think the whole thing is dubious but you can't let this opportunity go by.

GLICK: Excellent point, Charles Payne.

PAYNE: Yes. Thanks a lot.

GLICK: Thank you very much.

All right, guys. Coming up, Tony Clement is the Canadian minister of industry explaining why his country is showing billions to help GM return to viability. That's next. Stay with us.

(COMMERCIAL BREAK)

GLICK: Welcome back to MONEY FOR BREAKFAST. I'm Alexis Glick.

Coming up, the Canadian taxpayers are finding nearly or funding, I should say, almost $10 billion to bail out General Motors. Canada's Prime Minister Stephen Harper said it is regrettable but necessary to protect the Canadian economy.

The Canadian minister of industry Tony Clement is going to join us in just a moment to tell us why exactly they did it and what they hope to get as a return for this investment.

And the Beatles, I should say, they are set to make their video game debut this fall. Shane Kim, the vice president of Microsoft's Xbox 360 explains if the rock legends will be able to turn the slump in game sales around. Coming up in just a little bit as well.

All right. Let's take a look at the futures right now. The Dow down just two points. S&P pretty much unchanged as well as NASDAQ.

All right, well, Congress may have been out of town for the GM bankruptcy announcement but now lawmakers are looking to have their voice heard in the government's new $30 billion investment in the automaker. Speaking up, though, could do more harm than good for GM's operations and of course the taxpayers' investment.

FOX Business's Rich Edson is live in our Washington, D.C. bureau with a lot of the details.

All right, good morning, Rich. So let's talk about government control. Where would it likely come from?

RICH EDSON, FBN CORRESPONDENT: Good morning, Alexis. The government owns about 60 percent of the company, and that $30 billion investment is on top of a $20 billion investment already made. That's significant. And there are a few hundred people in Congress who are ready to try to manage few parts of GM. They are already doing it.

The government may not get involved immediately, but what if gas prices come down significantly? GM has already agreed to build smaller fuel efficient cars, so has Chrysler. When gas was cheap, the big cars sold.

The government still has to write the specific regulations for the increase in fuel efficiency standards which could favor one automaker over another and the government has tens of billions of dollars in GM's financing arm. We've already heard lawmakers pressure banks to lend more. What if GMAC's lending standards are too tight for some in Congress?

There's plenty to pick on there, Alexis.

GLICK: All right. So, you know, look. I mean as you and I both know, every policymaker in the business is going to decide that they want to have a hand in this. Where ultimately, though, will the auto task force stand? Is their job essentially done once Chrysler and GM comes out of bankruptcy, or will they remain in continuum as long as the government has a stake?

EDSON: The auto task force is going to be around for quite some time. What senior administration officials tell us is that they're not going to disband it immediately. What they're going to do is maintain the folks at the auto task force and maintain staffing levels as necessary.

Right now the government has a $50 billion investment in one auto company. They say they're not going to station anyone permanently in Detroit, but they're going to continue to work with GM.

Remember, the administration is going to work with General Motors to try to pick some new board members. That's a significant decision and decisions that are going to have to be made, the auto task force, Alexis, is going to be involved.

GLICK: All right. Rich Edson thank you very much.

All right. Well, the U.S. is not the only government getting in the business of autos. Canada and the government of Ontario, where GM's Canadian operations are based, are investing just about $10 billion combined in the bankrupt automaker. In return, our neighbors to the north are getting a 12 percent stake in GM. A move that's already being met with harsh criticism from the taxpayers in Canada.

Tony Clement is Canadian minister of industry and joins us this morning from Ottawa.

Good morning. Good to see you.

TONY CLEMENT, CANADIAN MINISTER OF INDUSTRY: Nice to be on your show, Alexis.

GLICK: So the Canadian Prime Minister Stephen Harper said that the $9 billion investment in General Motors on behalf of Canada was a necessity, perhaps not something that they chose to do, very much like the president of the United States here, but they wanted to maintain a future, a future in the likes of the auto industry. How essential was that investment?

CLEMENT: It was very essential from our point of view, Alexis. Really we were faced with a choice, once the Obama administration had decided to continue on with the Bush administration's policy of radically restructuring the auto sector and being an investor in the short-term.

Once that decision was made in Washington, then our choice was really very clear, either we participate in that and seek to maintain our about 20 percent share of the Canada/U.S. auto production, or if we don't participate in that, we risk losing all of that to the -- to our southern neighbors, USA and indeed Mexico.

So from our point of view, this was necessary to maintain our share of the auto sector which is a very important share. It was an integrated auto market, and from our point of view, we produce excellent product that is used throughout North America, but that was at risk of being lost if we did not participate in this investment.

GLICK: Walking through some of the details here, a lot of the taxpayers in Canada are just as concerned about the taxpayers here in the United States. In fact when they look at 5500 jobs that will be retained as a result of restructuring in GM, I think they were estimating it's about $2 million per worker to keep these GM jobs viable.[...]

It's much bigger than that, though, isn't it? I mean, walk me through the auto parts suppliers. How big is this industry for Canada?

CLEMENT: It's a huge industry for Canada. It's our largest manufacturing industry. Certainly, and is centered in the province of Ontario. We not only have the GM plants and the Chrysler plants, of course, we have Toyota and Honda found in Ontario as well.

But it's also the auto parts sector, as you mentioned, Alexis. Here's a sector in Canada that is probably the most competitive, the most efficient in the world, giants like Magna, Linamar, Martinrea, 80 percent -- or rather, sorry, 66 percent of what they produce in Canada gets shipped down to the United States for assembly in the United States plants.

So you have a truly integrated sector, and we were very concerned that if the auto sector started to shift south in terms of assembly, you'd also have the same shift in terms of auto parts affecting tens of thousands of jobs over and above GM and Chrysler and their assembly plants.

GLICK: Yes, it's the same ripple effect here. I saw some of the statistics suggesting that the Ontario suppliers employ 45,000 people over a $7 billion industry.

Here's the thing. Basically the prime minister is conceding, he conceded frankly in that press conference yesterday, to the fact that the likelihood is that that you will not see the vast majority of that money come back into the state's coffers or into the country's coffers.

Are you concerned about that, or is that just a risk that you have to be willing to take because we're experiencing one of the most difficult recessions post-World War II?

CLEMENT: Well, you know, he was very clear and very honest about the risk. Whenever you make an equity investment rather than a debt investment, of course, you're taking on more risk. There's more upside, but there's also more down side. There's no question about it.

And, of course, we're going in lock step with the Obama administration in terms of the chunk of sales of the equity over a multiyear period, and there will be some -- obviously some realization of a return on our investment there, but the fact of the matter is, if we hadn't participated, if the sector had shifted away from Canada, you are looking at employment, insurance costs, you're looking at welfare costs, you're looking at whole communities that are devastated and all of the social and economic impacts of that.

So when you weigh that against our investment, we feel that on a cost benefit analysis, it was the right thing to do.

GLICK: What role will you play?

CLEMENT: Well, if you're asking whether I, Tony Clement, are going to be determining the number of cup holders in the back of a mini van, we're not taking that role. We don't think that's an appropriate role. We are going to have a seat on the board of GM, just as in the Chrysler deal. We have a seat on that board as well. That's there to protect our investment.

But we really do believe we should let the marketing people and the production people do their jobs at GM and do it well. As Fritz Henderson said yesterday, you know, he's looking forward to the day where GM is finally looking at marketing, looking at production rather than looking over their shoulders seeing whether they're going to be living for another day.

They now got some stability in their investments, and they can move to being an excellent car company.

GLICK: All right, well, Canadian minister of industry, Tony Clement, thank you so much for taking the time this morning. We appreciate you joining us.

CLEMENT: No problem, Alexis. Thank you.

GLICK: All right. Coming up the trillion-dollars plus overhaul of healthcare in this country. It's going to get under way today in Washington, D.C. We're going to tell you how the changes are going to impact you.

And Conan O'Brien made his big debut as host of "The Tonight Show" last night. We will get you more details when MONEY FOR BREAKFAST returns.

(COMMERCIAL BREAK)

JENNA LEE, FBN CORRESPONDENT: Hi, everybody. Checking media news now.

America, meet the new host of NBC's "The Tonight Show," Conan O'Brien. O'Brien kicking off his star-studded debut last night when he was joined by actor Will Ferrell and the band Pearl Jam.

And taking a page out of his old late-night gig right here in New York City, O'Brien opened the show with a sketch that saw him running across the country after apparently forgetting to move to Los Angeles where his new show is based.

Luckily he did make it on time. And there's just a couple of clips from his show last night.

Well, with release of "Transformers: Revenge of the Fallen" out on June 26th Sears' Kmart chain is launching a Father's Day tie in along with a new push on new Transformer toys.

The new in-store and TV ad campaign is called "Transform Your Dad" and the retailer is offering two free tickets to the movie with a purchase of $50 in men's wear.

And General Motors' bankruptcy has deep aftershocks for the television business. According to GM's bankruptcy papers, the automaker actually owes ad agencies more than $162 million for air time and commercial production. As a result, many cable and broadcast networks have not been paid.

We will watch that story. Now over to Alexis.

GLICK: All right, Jenna, thank you so much.

Well, all this week FOX Business is taking a look at the growing red ink thanks to the government's spending and more debt is on the way thanks to President Obama's proposed $1 trillion plus healthcare overhaul. Not to mention everything else going on.

Well, Congress is going to begin debating the plan today after healthcare industry officials yesterday delivered their plans on how to cut a trillion dollars plus in costs over the next 10 years. The president wants the overhaul wrapped up by the end of the year.

But the question remains, who will foot the bill?

Douglas Holtz-Eakin, a former Congressional Budget Office director and current president of the consulting firm DHE, joins me. And Dr. Sreedhar Potarazu is the CEO of the enterprise software company VitalSpring Technologies and author of "Get Off the Dime: The Secret of Changing who Pays for your Healthcare." Love that title.

Good morning, gentlemen. Good to see you, guys.

DR. SREEDHAR POTARAZU, VITALSPRING TECHNOLOGIES CEO: Good morning to you.

DOUGLAS HOLTZ-EAKIN, DHE CONSULTING LLC PRESIDENT: Good morning, Alexis.

GLICK: All right, Doctor, let me start with you. What are the immediate challenges that are facing this proposed healthcare overhaul?

POTARAZU: The immediate challenges, Alexis, as you said, is who is going to foot the bill? The report that was released this morning talks about wanting to improve costs, improve the quality of care, and enhance coverage, but what's fundamentally missing in that report in all of what we've heard over the last couple of weeks is those that are actually paying for healthcare are nowhere in the report and were nowhere in the room, and that was the employers.

That's where the healthcare dollar begins in the system, and we fundamentally forgotten to introduce them or include them in the process in order to help drive the changes.

GLICK: Yes, I mean when you look at the percentage that they fund in this, I think it's 54, 56 percent of the healthcare costs, Doctor, why haven't they've been brought to the table thus far or is it too early in the game to make any judgments?

POTARAZU: You know, it's probably too late in the game, quite honestly, as opposed to being too early. And the best example we have is the fact that General Motors went bankrupt. I remember vividly having spent a lot of time with General Motors several years ago and working with their teams to help them better understand their healthcare costs and the sense of urgency that was necessary for them to get control of the reins.

And there was quite honestly a lot of complacency at that point, and we need to be able to empower corporate America to understand the responsibility of getting more proactive in this process. It's fundamentally a mistake we've made over and over again, and the fact that General Motors went bankrupt yesterday, and we know healthcare costs was a big part of that.

GLICK: Yes.

POTARAZU: . is the best example we can say that it's really too late. That they need to step in now.[...]

GLICK: Doug, you're shaking your head. You agree?

HOLTZ-EAKIN: Oh, yes, I think this is a very important insight. There have been some companies that have actively engaged. SafePlay comes to mind, and by doing the kinds of things that employers need to do, they have cut their healthcare costs bill enormously and their model for the kind of reforms that could take place if we do this right.

GLICK: You're going to appear, Doug, on a panel later today with Christina Roemer. You're going to talk a little bit about the future of the healthcare industry. What do you hope to achieve? What does this administration need to do? What do they need to bring to the table?

HOLTZ-EAKIN: Well, I think the report they put out this morning is another exercise in hopeful if not wishful thinking, and we need to think of healthcare reform like the computer industry where we see the kinds of real behind-the-scenes advantages that make computers more powerful and cheaper for the user.

Instead, too many Democrats are looking at healthcare reform like let's buy everybody a computer. That just costs a lot of money and it doesn't deliver a better product. So what really needs to happen this year is talking about getting a better product, engaging the employer community where they've delivered better products, and transforming the way we deliver care.

Too much of the focus is just on, you know, writing checks for more health insurance, and that will be a costly venture.

GLICK: Doctor, I see you shaking your head as well. Move this forward for me. Senator Kennedy, among others, will be starting at least to have some behind-closed door discussions about this. Where does the process go? Do we achieve healthcare reform?

POTARAZU: Not behind closed doors. That's part of the problem. We can't close the doors. It really has to be open discussion. You know the three C's of care coverage and cost have to be addressed with the three I's, which is what I always say. It's infrastructure, incentives and information.

The thing that we're lacking in the healthcare system right now before we really talk about reform is the infrastructure. We've got to have information on every part of the industry in terms of understanding whether the bill is going to be $634 billion or whether it's going to be a trillion dollars. It's sort of what I call balloon economics.

We can push compress the balloon and the side close to us looks like it's getting smaller when in fact the side behind our hand is actually getting much bigger. We don't have the technology in place today to be able to get all the information we need to estimate how much it is really going to cost and then what incentives we provide.

If you look at the appendix of the report that was released today, it is almost a lesson in algebra all over again in order to understand the economics of how they came up with the calculations and the guesses.

GLICK: I don't have a PhD. I feel like I need a PhD to understand healthcare reform. Thank god I have the two of you.

POTARAZU: Right. All of us.

GLICK: All right. Doug and Dr. Potarazu, it was terrific having the two of you on. I look forward to calling you after the show to get you back on as quickly as possible.

Thanks, gentlemen.

POTARAZU: We'd love to do that. Thank you, Alexis.

GLICK: All right. Coming up video game sales are slumping. Microsoft's Xbox 360 is trying to get a little help from some friends. We're going to tell you about. That's next.

(COMMERCIAL BREAK)

GLICK: The video game industry is working over time to promote the new hardware and games at the Electronic Entertainment Expo which kicks off in Los Angeles today. After the industry, which has long been thought to be recession proof, actually has seen some sales drop.

In fact, video game sales fell 17 percent in April while software plummeted 23 percent and systems dropped specifically 8 percent.

Now Microsoft is one company unleashing a whole range of products at the E3 to boost the bottom line. Shane Kim is the vice president of Interactive Entertainment Strategy and Business Development from Microsoft and the VP of the company's Xbox division.

Shane, good to see you.

SHANE KIM, MICROSOFT INTERACTIVE BUSINESS DEV. VP: Nice to see you, Alexis. Thanks for having me.

GLICK: All right. Well, a lot has changed in the year. We're just looking at those numbers, a decline of 17 percent. Actually 2008 was a terrific year. What's the issue this year? Is it that the recession just making consumers a little nervous about spending so much money on these video games and consuls?

KIM: Well, certainly I think the economy is affecting our industry like many other industries. We actually feel very good about the position that Xbox 360 is in. We're the only video game consul whose hardware sales are up through the first four months of 2009 over the same period in 2008. So I do think you can find pockets of success within the industry.

GLICK: Let's talk a little bit about announcements. You're going to make a couple of really large announcements. Some of which have already filtered out. First and foremost what about Natal? What exactly is it? What does it allow us to do on an Xbox?

KIM: Well, Project Natal is going to revolutionize home entertainment. It really is about breaking down all the remaining barriers that prevent people from enjoying the best of consul entertainment. It's something where you are the controller, the only experience that you need is life experience, and it enables everybody to just jump in and immediately start to have fun with Xbox 360.

GLICK: A lot of people, of course, are comparing it to the Wii. I know you don't want to do those comparisons. You have, in fact, said hey, wait a second. if I wanted to replicate the Wii, I would have come out with a completely new device.

This will work for existing Xbox holders, how does it work? I mean, just plain sense, what is it like?

KIM: Well, the irony is that we created an amazingly simplistic experiences for consumers as well as our development partners yet by taking a very complex hardware and even more complex software and putting all of that together to enable these amazing experiences that we are able to demonstrate yesterday at our press briefing.

Steven Spielberg was on stage to help us unveil it. He's been fascinated by the technology behind Project Natal and as a creative visionary sees what's going to be possible with Project Natal.

GLICK: OK. So -- but, Shane, you didn't answer that for me in the way that I was hoping, which is -- OK, I'm at home. I've got my Xbox. It is the cornerstone of the Glick household. OK? Everybody is sitting there.

(LAUGHTER)

KIM: Right. I remember that.

GLICK: Yes, I mean, hello? They're all sitting here with the -- you know the hand-held devices. How does this change what they're doing when they're playing a game?

KIM: Well, at the heart of Project Natal, what we have is a very sophisticated sensor that includes an RGB camera, a 3D depth sensor so you can move around in space, as you naturally would. A multi-array microphone so -- you know, what that enables is full body gesture tracking so you can use your head, your hands, your feet.

We can sense whether or not you're sitting down or standing up. It's got facial recognition as well as voice recognition so you can have multiple people involved in the entertainment experience and we'll be able to discern between people even if they move between each other and include the camera.

We can detect when one person answers a question, let's say, to a trivia game versus another person. You can walk up to your Xbox 360 and will immediately recognize you through our facial recognition software.

GLICK: Wow.

KIM: And will be able to log you into Xbox live. So it really is about breaking down those barriers that prevent, I think, a lot of people, intimidate people from enjoying everything our industry has to offer.

And we're excited that Xbox 360 is going to take the leadership position.

GLICK: Very cool. Just.[...]

KIM: . here with project natal.

GLICK: Just quickly, Beatles. This is a big one. Beatles Rock Band. Are you psyched?

KIM: Oh, my gosh, it was fantastic. We were honored to have Paul McCartney and Ringo Star on stage for us as we world premiered "Rock Band the Beatles" edition. And it was fantastic energy in the press briefing.

GLICK: Oh, man, well, I'm sure everybody else was so excited.

Shane Kim, best of luck. Stay in touch. And I look forward to all these new developments. I know it's not coming out this year, Project Natal. It's probably a next year event. I know you won't give away too many details but thanks very much for joining us this morning. Appreciate it.

KIM: Thanks for having me, Alexis.

GLICK: All right, guys, we're going to take a quick break. We will be right back. We're going to talk a little bit more about General Motors and the future. That's coming up next.

(COMMERCIAL BREAK)

ALEXIS GLICK, FBN ANCHOR: Good morning and welcome back to MONEY FOR BREAKFAST. I'm Alexis Glick.

Coming up, GM begins its trip to the road -- a road trip I should say, perhaps, through bankruptcy today. And lawmakers are looking to get their say in GM's bankruptcy, which may be bad news ultimately for the taxpayer. We're going to go live to Washington, D.C., for the details in just a moment.

Let's take a look at the markets. We've been basically unchanged throughout the morning. The Dow, right now, up 17 points. S&P up 2. Nasdaq up 5.

Let's go directly to the markets. Ashley Webster's in London. Connell McShane is here in studio. Let's get started with Connell.

CONNELL MCSHANE, FBN CORRESPONDENT: All right, Alexis, thanks very much.

And as we look at these markets today, as you said, we are up on the futures and indicated to open higher today after being up 5 percent plus over the course of the past three days. So we'll see if the rally continues.

And while we're looking to see if that happens, we're focused on banking stocks. So more and more of these banks going out into the markets to raise money, proving to the government they can do so. That's the requirement. And the hope is then you pay back the TARP money with that.

Morgan Stanley the latest to do so, announcing this morning a $2.2 billion stock offering. So Morgan Stanley's stock price is one that we're watching in the pre-market trade. Move a little bit lower. See it behind me here. Closed about $30 a share, down to $29.51 in the pre-market.

So these are diluted (ph) measures. You would expect the stocks near term to move a little bit lower. And we'll see if that kind of plays itself out throughout the day. So Morgan Stanley is one.

American Express, $500 million in an offer. Looking to repay the TARP as well. From $26 down to $25.44. Now, American Express giving some more color on this announcement, which was actually made last night. Giving the color this morning, saying if the TARP money is repaid in the month of June, the onetime impact of that will be $0.18 a share in the second quarter. $26 down to $25.44.

Let's take a look at J.P. Morgan while we're at it as well because they went out and said they're going to raise $5 billion, satisfying the government requirement there, paying back the TARP money. Initially the stock went down. Now it's up a little bit, $36.43. And you can make the case, long term, this is a positive that you're moving out of the -- from under the government's wing there, so to speak.

So, anyway, the banking stocks, certainly, Ashley, ones we're watching. Let's head over to Europe now to check those markets from your side of things.

ASHLEY WEBSTER, FBN CORRESPONDENT: Yes, good morning, Connell.

It's kind of interesting. It feels like the markets on the turn just a little bit here in Europe. We're seeing the dollar become weak again, down now against the euro and pound after being up earlier in the day.

As for the markets themselves, well, we've been in pretty much the same range since opening some five hours ago. It's been a struggle for the FTSE here in London. Still down just about 1 percent or there abouts. Close to flat on the CAC 40 in Paris. Just down slightly at this hour. Meanwhile, the DAX index in Germany essentially flat, just up a couple of points as we speak.

Now the -- as the auto sector undergoes a global consolidation, if you like, French carmaker Peugeot Citroen saying that it is open to all forms of alliance and partnerships. Kind of throwing out the offer there, if you like. Board Chairman Thierry Peugeot says that the company aims to become a more global group, although it wishes to remain independent. It will be interesting to see if they get any bites on this. Peugeot shares up 2.5 percent in Paris right now.

Meantime, not so good times for the airlines. Irish airline Ryanair, that's Europe's largest discount carrier, is reporting its first annual loss as fuel bill costs took off and the airline also having to write down the value of an stake in Irish competitor Aer Lingus. All of this means that Ryanair shares are down 2 percent on the day in Ireland.

But the market's doing its best or doing the best to try and turn things around. We'll see, Alexis, back to you in New York.

GLICK: All right, Ashley, thank you very much.

Well, the wheels are rolling forward for GM, who's preparing for the company's first full day of bankruptcy proceedings and GM is preparing to announce today the tentative sale of its Hummer brand. Fox Business' Adam Shapiro is live at the New York bankruptcy court with the next steps for General Motors.

Good morning, Adam.

ADAM SHAPIRO, FBN CORRESPONDENT: Good morning, Alexis.

General Motors has announced that they do have an agreement to sell Hummer. They won't name who that buyer is or say how much that the buyer will pay for Hummer, but it will potentially save 3,000 jobs here in the United States. They build Hummer in two locations, the H2, the big large Hummer that people are familiar with, is built in Mishawaka, Indiana, at an AN (ph) general (ph) plant.

But the Hummer, the much smaller H3, is built in Shreveport, Louisiana, where they built the Chevy Colorado pickup truck. The Colorado is not going to be built there much longer. It's going to move out. But they will continue to build under contract for the new Hummer owner the H3. So that is one good sign if that deal closes.

The other issue is, will the deal close for General Motors. In the first day hearing, they were petitioning the judge for a hearing to actually hold a sale of the old assets to good General Motors, or whatever you want to call this new corporation that will emerge and leave bankruptcy court. We asked Fritz Henderson yesterday if he really thought this would close within the 60 to 90 day timetable and here's what he said.

(BEGIN VIDEO CLIP)

FRITZ HENDERSON, GENERAL MOTORS CEO: We said today, we talked about a period of 60 to 90 days in terms of closing. Having the 363 (ph) sale completed and closed in 60 to 90 days. Our preference is, obviously, no later than 90. And sixty would be our target.

(END VIDEO CLIP)

SHAPIRO: And there are some target dates that people who are connected to General Motors need to be aware of. First, tomorrow, there are two big issues. An organizational committee meeting will take place. Remember, Al Koch is going to be in charge of restructuring the old General Motors. Also, creditors are going to have a meeting in midtown Manhattan on the future of General Motors. That will take place on June 3rd.

On June 19th, objections to the potential sale, the 363 sale, are due here in bankruptcy court. Then on June 22nd, if you wanted to bid for General Motors, your bid has to come in by June 22nd, with a hearing scheduled to take place June 30th. If all goes according to plan, a closing on a deal could take place roughly 30 days later.

Similar to what's happening with Chrysler, although we expect some news on Chrysler because they're trying to get certification in the appellate court so that there deal can close perhaps as soon as Thursday.

Finally, Alexis, got to tell you, Jenna Lee and I always talk about cars. She's a Camaro woman. I've decided that you are probably a '65 or '66 Pontiac GTO. It's an awesome car. You'd look great in it. Back to you.

GLICK: All right. I like that. That's a good analysis. All right, Adam, thank you very much.

Well, at the end of bankruptcy's tunnel, there will be three new owners waiting to take their stakes in the new GM. The U.S. is throwing down another $30 billion in aid. And that will equate to a 60 percent stake in the automaker, while the UAW's restructuring concessions will get a more than 17 percent stake in the automaker. And then there's Canada. We talked to them early this morning. They'll take a 12 percent stake in the automaker for its more than $10 billion investment. All three parties will have members on -- specifically on a new GM board. But who ultimately will really have the most say in the future of the new General Motors?[...]

Well, here's my take. Number one, the biggest influence in this process will be the product development team. Specifically Thomas Stevens at General Motors. He comes from an engineering background. He was one of the biggest pushers of hybrid technology. It will be interesting to see, but it's about product development and what the consumer wants on the lot.

Number two, frankly, I wouldn't count Fritz Henderson out. He's demonstrated in the past two months that he understands all the stakeholders and ultimately is willing to do what it takes. But, number three, the government should stay away and, unfortunately, they will not.

All right. Joining me for more of a breakdown, Gary Dilts is the vice- president of J.D. Power and Associates. Gerald Meyers, a former chairman and CEO of American Motors Corp, who's currently a professor at the University of Michigan's Ross School of Business. And John Stoll, a reporter with "The Wall Street Journal."

Good morning, everybody. Good to see you guys.

GARY DILTS, J.D. POWER AND ASSOCIATES VICE PRESIDENT: Good morning, Alexis.

GERALD C MEYERS, MICHIGAN BUSINESS SCHOOL PROFESSOR: Good morning.

JOHN STOLL, WSJ REPORTER: Good morning.

ALEXIS: Gerald, let me start with you. Who do you think will ultimately have the most influence over the success of General Motors?

MEYERS: Well, immediately, we'll find that General Motors' management will either take over and be up to the job. And if they are, I expect that the first six months to one year will depend upon how capable they are and how well they perform.

GLICK: Would you agree, John, it comes down to the management?

STOLL: It does come down to the management. It also comes down to how the U.S. market recovers. Ten million units, it's going to be a break-even company. And they need to generate cash flow in order to remain independent. We heard about Peugeot wanting to be aligned with somebody. They're going to be open, definitely, or they're going to be game for somebody to come -- to try to take -- come in and take bids on GM. If they're not making money, the next step is an acquisitions. It's not bankruptcy court again. It's going to be an acquisition. Somebody -- they're so much smaller, somebody can come in and take this company over.

GLICK: So, Gary, are we moving to far ahead here for just a moment? Is it not necessarily about who will control the future viability as much as making sure that they usher their way through the bankruptcy process as quickly as possible so that they don't lose to much credibility with the American consumer?

DILTS: Yes, good point. I mean, if you look at GM and Chrysler really for the last six months, they have been in a penalty box that has hurt them both severely. So, again, we're watching Chrysler began to emerge from the bankruptcy process and we're seeing some -- at least some glimmers of hope here from a consumer standpoint. They will look a little better in retail we think in the month of May at Chrysler. So we see GM kind of have been through the worst of it here, but they've got to -- there's no doubt, like Fritz Henderson said, they've got to move through this bankruptcy quickly and get some confidence back with the American consumer that they're going to be here and that they're going to be building some great cars, which we believe they are going to be doing.

GLICK: Gerald, look, you sold American Motors to Renault. Renault was sold to Chrysler. You've been through the process of seeing how it is that corporate cultures communicate with one another, what it looks like in this world, in this universe. A lot of these deals have not worked. What makes us think that GM or Chrysler will be viable six months, a year, two years from now?

MEYERS: Well, when we look at the Chrysler situation, it's a little bit different than the General Motors's situation. Chrysler has a job not only of resurrecting itself and getting going, but it has the culture clash possibility with the Italian company Fiat. and ordinarily these cross- Atlantic, trans-Atlantic combinations falter on culture clashes.

General Motors doesn't have this problem. There's is more of a, how are they going to get along with government oversight? The I think the pressures are going to be enormous. The pressure groups are going to want to have their agenda accomplished. And that may not be consistent with the success of a business.

GLICK: It's interesting, John, I spoke to the vice chairman, Bob Lutz, earlier this morning and I said to him, hey wait a second . . .

STOLL: (INAUDIBLE) Bob.

GLICK: Yes, yes. I mean, he's great. I mean, you know, he's so colorful. You know, I love having him on. But he said, look, it's been demonstrated to me, and I've spent a lot of time with the task force, that they will not intervene in the type of vehicles that we make. Yet when he -- you know, when they announced his retirement, one of the reasons he was retiring, leaving the business, was because to much government intervention, to much regulation. So which one is it?

STOLL: Yes, I think we have to take the Obama administration on what they're done, not on what they're saying. It's very convenient right now to say, we want to be a passive shareholder. That's what everybody wants to hear. They're very afraid of government intervention on every level.

But the Obama administration's been very aggressive and intrusive at General Motors. They fired the CEO. They've constructed an equity chart as to who lands where and who gets what. They have every right to do that, they are the lender of last resort. But this is the federal government and it doesn't scare people.

We've also seen, in my opinion, which is a handicapping, or sort of a crippling influence of the UAW has been to be able to tel GM what to build where and how much it's going to cost. They did reduce the impact of the UAW in the couple of weeks with the new contract, but I think it's absurd that the government and the United Auto Workers union have told General Motors what to build, where. And what they've done is they said, you have to build a small car here now. That's GM's decision to make.

Now, granted we're in a different environment and the big shareholders is the government and the UAW is there. But if you really think about the viability of this company, they built small cars in Korea. They have a lot of capacity around the world to build these cars. Let the market determine when you're going to -- and where you're going to build these little cars that people have not wanted yet, in droves.

GLICK: It's interesting, Gary, I was talking to the Canadian minister of industry earlier about what they got out of the deal. I mean it seems as though every stakeholder got guarantees about production, percentage production, how much market share they would maintain, how much investment they would see in their specific plants. I mean, this was very detailed and very specifically thought out as to what each stakeholder would have at the end of the day. Does that suggest that this is all hands on deck?

DILTS: Well, that's what I see. And I think that, notwithstanding the claims to the contrary, why, the influencing forces coming in from the government, from the union, from the environmentalists, from the large array of people who have an agenda that they want -- they want to accomplish, that very often may or may not be consistent with the success of the company.

GLICK: Gary, what do you think?

MEYERS: I, you know, obviously, a lot of people with a lot of different interests.

Just to note, on the Canadian position here, I mean the Ashwa (ph) plant, a huge and very successful plant for General Motors, has been one of the highest quality plants in North America for better than 10 years. So it's not just a good deal for Canada, it's a good deal for General Motors. They're getting ready to launch their new Buick Lacrosse out of that plant, the new Camaro that, by the way, we think would be a good car for you, Alexis, is coming out of that plant. So, again, this is not a charity act here keeping the Canadian business alive and it's -- I think it is good for General Motors and for -- certainly for Canada.

GLICK: John, you broke the news about Hummer this morning and I couldn't -- I tried to see -- I tried to get Lutz to give me some details, but I couldn't get out the details. Why is this hidden behind a shroud of secrecy? What's the back story here? And wouldn't it become unveiled in the bankruptcy process who perhaps is the buyer?

STOLL: Who's the buyer? You know, all indications are that it's a Chinese buyer and it may not be the time to announce that a Chinese company is coming in to by an American icon. I mean faded and tarnished as it is, Hummer represents a very real part of America in its mobility and size and military strength.[...]

And whether or not, you know, time will tell whether to -- if it's a Chinese buyer. All indications are there. And, plus, the price they got for Hummer, the White House spokesman yesterday basically, you know, they got pocket change for Hummer. So it's not exactly like they're doing to be doing victory laps over what they got for this asset. This was an asset that was a prize worth, you know, they thought at least $1 billion a few years ago and now they're collect a couple hundred million.

So these are details that will come out over time. Maybe when the political atmosphere tones down. When the administration's worried about some other industry, then they can come out and tell you that it was Dongfang (ph) or Beijing Motors or Brilion (ph) Automotive that bought this company.

GLICK: You know, Gary, one of the things that Lutz said earlier is that the auto task force is the first body within the administration that actually took the time to look at the industry, to get to know the industry, to get involved in this story and that perhaps it should be a permanent stakeholder in the future. Are they the ones who are -- do you believe, the ones who are going to play the government's role in shaping the future of GM?

DILTS: You know, first of all, I thought that was a great comment and I -- you do kind of sit back and Lutz does say some amazingly clear things. But the fact that the government is getting this involved, I think is going to be good for the industry. But you made the point in the beginning and I think Lutz is making the same point, that it's all going to come down to the product development that takes place over the next couple of years. So if you want to see how GM's going to do, watch the next five, six launches of vehicles they put in the marketplace and see how well they're doing.

There's 30 new vehicles going to come to the market every year for the next five years. GM has got a big piece of that with a big capital investment. So, again, they've got a lot of new hardware coming into the market, high fuel efficiency vehicles. But let's see how well they do. Let's see how they price them and do they put them in a market at the right volumes, you know, and do they really manage these launches properly or do they overload the system, which has been, you know, kind of the history of the industry and certainly General Motors?

GLICK: Excellent point. Thomas Stevens has big shoes to fill. But then, of course, it's all about the marketing. Its' about getting it through the processing. It's a tremendous job.

All right, gentlemen, thank you very much. Gary, Gerald and John, thank you.

All right, coming up, JP Morgan is hoping to get out from underneath the TARP. We're going to tell you what the big bankers is up to now.

And General Motors and Citigroup getting the boot from the Dow Jones Industrial average. We'll find out who's taking their top spot when we return.

(COMMERCIAL BREAK)

GLICK: Checking financial news now.

JP Morgan Chase and American Express are selling shares in an effort to paying off their portions of the TARP bailout. JP Morgan says it's selling $5 billion in common stock, while American Express is working to unload $500 million in shares. The moves come after the Fed announced yesterday banks must show they can raise money from private investors before exiting TARP.

And Citigroup is holding off on handing out tens of millions of dollars in executive bonuses. This is in an effort to avoid public backlash. "The Wall Street Journal" is reporting Citi told five former executives they won't be getting the remainder of their severance payments as previously promised. The bank has already paid more than half of the hundred million dollars those executives were owed.

And Alan Schwartz, who served as CEO at the former financial giant Bear Stearns in the companies final months, has a new job. The privately held investment firm Guggenheim Partners is expected to announce today that Schwartz will become their new executive chairman beginning later this month. JP Morgan Chase, which bought Bear Stearns, offered Schwartz a senior dealmaker position. And banks, including Goldman Sachs and Citigroup, were also reported to talk with Schwartz but a little snag.

All right. Well, with General Motors filing for bankruptcy yesterday, the Dow Jones Industrial average decided to make some changes to its index. GM and Citigroup are out, Cisco and Travelers are in. Shibani has much more of the details on this.

Shibani.

SHIBANI JOSHI, FBN CORRESPONDENT: This, of course, was the biggest story for the markets yesterday and something that the markets are continuing today, yesterday, and until essentially the markets start to trade with the new GM component. Now, GM's bankruptcy yesterday will come -- will set off a row of changes in the stock market. More importantly, Cisco's move to the Dow won't have any impact on the Nasdaq, where the stock is currently trading. Cisco will continue to trade through the Nasdaq's electronic exchange, similar to fellow Dow components and Nasdaq listed stocks Microsoft and Intel.

Now in being added to the Dow, Cisco says, "we believe our inclusion in the Dow demonstrates not only Cisco's role as a broad technology indicator, but how remarkably the internet and networking have transformed the way businesses and consumers connect, communicate and collaborate."

Now, many experts thought that Apple or even Google could be contenders for the Dow spot, but ultimately Cisco was chosen because it is believe it, similar to the automotive industry, influenced economic and social change. More so than the other names that we just mentioned. The Dow will attract a wider array of investors to Cisco, as well as Travelers, that's coming in and replacing Citigroup. And because long-term prospects are stronger for both of those companies, certainly over GM, it's inclusion of both Travelers and Cisco could take some of the volatility out of the Dow.

But don't count out Citigroup just yet. It could one day return to the Dow. Companies like Chevron and even General Electric, both have been kicked out and have both been allowed back in. The selection of Dow components is ultimately the responsibility of "The Wall Street Journal" managing editor. And we should mention that "The Wall Street Journal" is owned by the News Corporation, the parent company of this network.

But what's interesting, Alexis, is that Cisco's CFO was on our network yesterday and he said the company was not consulted, was not informed, had no indication of its inclusion in the Dow until it hit the news wires. It's a very, very sort of private process that they do.

GLICK: A highly coveted process.

JOSHI: Yes.

GLICK: Yes. No, I was talking to Robert Thompson about it yesterday on the opening bell and the door is still open for Apple. You just never know when or if it could happen.

JOSHI: Right. Exactly.

GLICK: All right. Thank you very much.

All right, let's get a look at the European markets. Sky News business reporter Anna Jones joins us live from London.

Good morning, Anna.

ANNA JONES, SKY NEWS: Good morning to you, Alexis.

Not much enthusiasm I can report on the markets here in Europe. Let's take a look at the figures. All down so far this morning. The Frankfurt DAX lower to start off with. The CAC quarant (ph) in Paris also experiencing falls, as you can see there. And the FTSE 100 down over 1 percent at the moment.

Now the mood in Europe's not been helped by the latest unemployment figures that are out. They suggest that it's jumped in April to its highest level for 10 years. That's a level of 9.2 percent. Meanwhile, in London, share being pulled up (ph) by financial stocks in particular.

Barclay's shares dropped about 12 percent. And that was on news that one of its key Gulf (ph) investors dumped 3.5 billion pounds worth of shares. That's equivalent to an 11 percent stake in the company. And it took everybody by surprise it seems. Now Sheikh Mansoor, he's the man behind the International Petroleum Investment Company. He was seen as a long term investor. And that's dented confidence in that sector.

Now you have a lot of problems in your motor industry. We've got problems here as well. And today LDV, that's our vanmaker based here, has announced that its rescue deal seems to have gone sour. Now LDV closed its plant back in December, saying that the demand for vans have dried up. It kept warning it was going to go bankrupt unless it got some help.

And then last month is seemed to have a white knight stepping in, in the form of the Malaysian group Weststar. They came in and said we're going to buy this company outright. We need a government loan of five million pounds just to bridge -- a bridging loan while we do all the details on the deal.[...]

Now the government today is saying that bridging loan money is still on the table, but Weststar, it seems, seems to be having problems raising cash of its own. The government says the deal has collapsed. LDV is a little bit more optimistic. They're, at least, not ruling out hope. But LDV bosses even taken by surprise by this. And the 850 workers at a plant, as well as the subsidiary industries, extremely worried today.

GLICK: All right, Anna Jones, thank you very much for the update.

All right, guys, we're going to take a quick break. We'll be right back in just a moment. We'll get a preview on the New York Stock Exchange and we're going to talk a little bit about generation debt. More of that red ink. How are we each going to pay for it. That's coming up.

(COMMERCIAL BREAK)

JENNA LEE, FBN CORRESPONDENT: Welcome back, everyone, to MONEY FOR BREAKFAST. I'm Jenna Lee with a look at the latest news headlines.

President Obama leaves tonight for his Middle East trip. The president says he wants to use this trip at a chance to improve the U.S.'s relationship with the Muslim world. And the president's first stop will be Saudi Arabia, where he will have a private meeting with King Abdullah. It will be followed by a visit to Egypt, where President Obama is expected to make a seminal speech in Cairo. Our own Brian Sullivan, by the way, is in Egypt. We'll have live reports coming to us this week.

In the meantime, Supreme Court Nominee Judge Sonia Sotomayor will be making the rounds on Capitol Hill today. She'll be meeting with several Senate leaders, including Senate Majority Leader Harry Reid and Senate Republican Leader Mitch McConnell. This is all in the hopes of securing her nomination to the Supreme Court. And for more on this, we go to Fox News' White House correspondent Mike Emanuel for the latest details.

So, Mike, let's talk a little bit about Judge Sotomayor's visit to Capitol Hill. What is on the schedule and what should we actually expect from this visit?

MIKE EMANUEL, FBN CORRESPONDENT: Well, Jenna, she is scheduled to meet with 10 U.S. senators today, including the leaders you mentioned. Also leading members of the Senate Judiciary Committee, which, you know, she will appear before that committee during the confirmation process. She'll also meet with the two senators from the state of New York. So we expect we'll see some photo opportunity stuff. But there will be opportunities behind closed doors for her to basically lay out why she wants to be a Supreme Court justice, her qualifications and for a little bit of question and answer session with the senators privately.

LEE: All right. So she's also been working on this 10 page questionnaire that gets into great detail about her life. First of all, what have you heard about this questionnaire? What kind of questions are actually on it? And what is the status of her actually being completed and ready to hand this in?

EMANUEL: I've been told it is not complete. It will not be done today. So we can expect that in the coming days. But it is very invasive in terms of your life. You know, asks all sorts of questions about your background, about what kind of outside activities you would want to have if you were to make it on the Supreme Court. Also, what kind of conversations you may have had leading to this point. Did you promise any organizations how you would rule on a particular issue? Did you tell the White House how you might vote on a particular issue? And so it really goes into a great deal of detail.

Jenna.

LEE: And since we are, of course, the business network, Mike, what about finances? Does she have to talk about that as well?

EMANUEL: Absolutely. This is a financial statement of net worth. It has assets and liabilities. Also asking the assets and liabilities of a spouse or immediate family members. And so not just getting into your personal financial business, but also everybody around you to see if there's any potential conflict of interest or if you're in debt up to your eyeballs.

Jenna.

LEE: Yes. Well, a lot of us are, Mike. Do you get to look at that questionnaire once it's actually completed or is it just for -- is it confidential?

EMANUEL: We believe that we will get a good look at it after it's done. So we'll let you know.

LEE: We'll look forward to that, Mike. Mike Emanuel who's coming to us from the White House today.

Thanks, Mike.

EMANUEL: Thank you, Jenna. Thank you.

LEE: Well, a quick update here on a story we have been watching for the last few days. Stormy seas and heavy clouds are hampering the search for Air France Flight 447, which disappeared over the Atlantic Ocean with 228 people on board.

A French military spokesman says even if the debris is found, the rescuers are going to have an extremely difficult time going to it. This is because the area where the plane may have gone down, off the coast of Africa. There is actually an underwater mountain range as big as the Andes, as steep as the Andes, just under water. By the way, this flight, of course, was going from Rio to Paris.

So we'll be watching again any developments on this story.

You're up to date here though on the Fox Business Network.

Coming up, members of Congress are sounding off on GM's bankruptcy. We're live in Washington with the details on that.

And college students are graduating to a world of red ink. We're going to break down the nation's debt and see how much it will cost you when MONEY FOR BREAKFAST returns.

(COMMERCIAL BREAK)

GLICK: Welcome back to MONEY FOR BREAKFAST.

I'm Alexis Glick.

Coming up, lawmakers on Capitol Hill are looking to get in the mix on GM's bankruptcy. We'll go live to Washington for the details.

And the red ink facing the U.S. continuing to climb over the $11 trillion mark. That's right, $11 trillion. We're breaking out our calculators to see how much the members of Generation Debt will ultimately be paying for that bill.

First, take a look at the futures.

We're in the green this morning, just slightly. Jeez, look at this -- now we're down. All right. We were up 17 when I went to the green room, now we're down 22 on the Dow industrials. The S&P is down one, Nasdaq is down one.

All right. Let's get specifically to the markets. Perhaps Connell McShane can explain it better than me -- Connell.

MCSHANE: No, no idea, Alexis. Yes, it's nothing you said though, I don't think. But you're right, we have been up and down this morning.

We were higher, now a little bit lower ahead of the open. But remember, we have been up five percent plus over the course of the past three days. Nice little run of the markets. Not a surprise if we were to give some back today.

That said, we have a number of individual stocks we are focused on that are in the news.

Let me start with the education company DeVry. That should be a mover to the upside. It's already up six percent or so in premarket trading, because that's the company, DV, that is taking the place of GM in the S&P 500 Index. That will be at the close of trading today, 47 bucks, almost -- $46.70 from $44.37 at the close yesterday. Again, taking the place of General Motors in the S&P.

Data Domain, a company you may not know off the top of your head, but you may hear about it today in the market reports, because as you see here in the premarket, I mean, it's up about 17 percent or so. And the reason here is we have a bidding war going on for this company.

It's a storage, data storage company. And you have two companies in that space, EMC and Network Appliance, that are bidding on it. Net App with a bid of $25 a share. But EMC last night looked like it topped, and its bid is valued at $30 a share, and that's why the stocks traded up to $31.

So we'll see. We don't see a lot of bidding wars these days, Alexis, but we have one going here for that company, and obviously that's going to be a big mover as a result.

But as you said, futures now were higher. Well, actually, you know what? They were lower, then they were higher, now they're back lower again. So we're kind of running in place this morning.

GLICK: Yes. It's confusing.

MCSHANE: It is.

GLICK: All right, Connell. Thank you very much.

Well, as part of the Fox Business Network's special series, "Red Ink Wink," MONEY FOR BREAKFAST is teaming up with the college news service U-Wire to take a closer look at the financial challenges facing Generation Debt, the students of America who will inherit this country's growing red ink.

The nation faces more than $11 trillion debt, and growing with Uncle Sam's decision to invest $30 billion more in the now bankrupt GM, a move President Obama says is necessary for the future.[...]

(BEGIN VIDEO CLIP)

BARACK H. OBAMA, PRESIDENT OF THE UNITED STATES: A sacrifice you might not have chosen to make, but a sacrifice you were nevertheless called to make so that your children and all of our children can grow up in an America that still make things, that still build cars, that still strives for a better future.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Current government spending makes me feel hopeful for the future in that maybe all of this money that's being spent on bailouts will get us back on the right track.

UNIDENTIFIED FEMALE: It's kind of frustrating that we are going to be the ones incurring this debt, and my kids are even going to have to be the ones that are most concerned about paying off all this debt.

(END VIDEO CLIP)

GLICK: All right.

Well, Fox Business Senior Economist Mr. Lieberman is the number cruncher, and he's going to break down how much of this debt John Q. is responsible for.

Hello.

MARK LIEBERMAN, FOX BUSINESS SR. ECONOMIST: Hi. Good morning, Alexis.

We took a look at this as if it were a credit card bill. And as you said, we owe $11.3 trillion. That's our total debt. At least as of last Friday, I think.

That breaks down to about $11,000 for every person over the age of 16. If we treated that as a credit card bill and worked against it...

GLICK: That hurts.

LIEBERMAN: ... trying to figure out what the monthly minimum payment would be, that would be about $1,100 per month just for the minimum payment. You know how you get your credit card statement every month, and it's the interest every month.

GLICK: Yes.

LIEBERMAN: And as we did that, we looked, of course, at the recent transactions that have added to the credit card balance, the stimulus...

GLICK: Yes, the list of expenditures. I mean, these numbers are scary.

LIEBERMAN: Yes, $787 billion for the stimulus. The TARP bailout was $700 billion. The auto bailout was about $85 billion.

GLICK: So far.

LIEBERMAN: So far, exactly.

Now, to pay that monthly payment, you would have to earn about $92,700 a year. That's your total gross salary before taxes are taken out.

Compare that to what the average college graduate is going to earn coming out of school. That's about $49,000, so just a little bit more than twice what the -- or a little bit less than twice, I should say, what the average college graduate will earn.

GLICK: Talk about the outrage associated with these numbers. First of all, Mark, $11 trillion, how does that equate in just regular times, not a deep recession? I mean, we always carry a heavy debt burden.

LIEBERMAN: This deficit is record, and it's the accumulation of what we saw during the Bush administration, plus the additional effort that Congress and the president have had to undertake to address this unusual economic crisis that we have.

GLICK: So what this tells me is higher taxes for everybody.

LIEBERMAN: Or cut back on spending. There are two ways to approach these things. You approach a deficit two ways. We either reduce spending or you raise revenue.

GLICK: Have we seen anything come out of this administration that suggests reducing spending? I don't think so.

LIEBERMAN: Not yet. Not yet.

GLICK: I'm seeing higher taxes. Let's get used to.

Mr. Lieberman, those numbers, I need to go have a drink. That's scary.

Thank you, Mark.

LIEBERMAN: OK. Thanks, Alexis.

GLICK: OK.

Coming up, we're going to go live to the New York Stock Exchange for a preview in just a moment.

And the Beatles are reunited in cyberspace. We're going to tell you how that will ultimately affect Microsoft's bottom line in today's look at the Fox 50.

That's coming up next.

(COMMERCIAL BREAK)

GLICK: Welcome back.

My favorite topic, it's sports business. The 2009 WNBA season is a week away, and the Phoenix Mercury is breaking new ground for pro basketball in our country.

The team will be the first pro basketball team in the U.S. to sell a sponsorship for its uniforms. Yesterday, the club made a three-year deal with LifeLock, with the LifeLock's logo replacing the Mercury insignia as the primary mark on its uniforms. Look at that. That's very impressive.

It appears as if the St. Louis Rams will be the next NFL team put up for sale. The family of the late Rams owner, Georgia Frontiere, has retained Goldman Sachs to help find a buyer for the team, which currently is valued at $920 million.

And Ireland may be a new fan base for the Pittsburgh Steelers. The chairman of the team, Dan Rooney, is preparing to step down from the team in the next few weeks once the Senate confirms him as, get this, President Obama's new ambassador to Ireland. His son, Art Rooney II, will continue as team president.

Pretty cool.

All right. Well, Congress may have been out of town for the GM bankruptcy announcement, but now lawmakers are looking to have their voice and their say in that $30 billion investment in the automaker.

Speaking up though, ultimately, as you know, could hurt GM, ultimately could hurt our taxpayer investment. But you would never expect members of Congress to stay quiet.

Fox Business' Rich Edson is live in our Washington, D.C., bureau with the ultimate ramifications.

I mean, Rich, I can't even manage -- imagine all the scuttlebutt behind the scenes down there with Congress back. What are they saying?

RICH EDSON, FOX BUSINESS CORRESPONDENT: Yes. Well, they were going to start to talk. They have already started talking, and they weren't really in session yesterday.

Fuel efficiency standards and regulations, board members selection, part owner of the financing arm, the federal government is already involved in the auto industry as stewards of taxpayer dollars in their home districts. Lawmakers are now debating GM's restructuring plan.

The company says its goal is to break even with 10 million car sales. That's down from 16 million now, and that means a lot of plant closings in a lot of districts.

Congressman John Dingell, probably one of the strongest auto industry supporters here in Washington, has already written GM's CEO, Fritz Henderson, on the announced closing of the Willow Run transmission plant, saying, "I respectfully urge that GM, under the auspices of its restructuring plan, commit to retaining this facility and its workers." He argues it's a plant that built B-24 bombers during the Second World War, and it makes transmissions for cheaper than its competition. But it is that type of management pressure other lawmakers say is dangerous.

(BEGIN VIDEO CLIP)

SEN. LAMAR ALEXANDER (R), TENNESSEE: Members of Congress would start holding hearings saying things like, "We are the owners and we demand to know. Why are you building this model? Why are you closing the plant in North Carolina and not in Tennessee?"

"Why are workers not paying more? What about these work rules? Why is this battery being built in South Korea and this engine being shipped from Mexico?"

(END VIDEO CLIP)

EDSON: The president says the administration will let GM run itself, but it only takes one incident to get a few hundred congressmen calling executives in for hearings. We saw that with AIG and its bonus payments.

Alexis, back to you.

GLICK: Oh, only the best. Only the best from lawmakers.

Rich Edson, thank you very much.

All right. We've got some breaking news. Let's go directly to Ashley Webster, overseas in London -- Ashley.

WEBSTER: Yes. Thank you very much, Alexis.

We've been following the story of this Air France Flight 447 that went missing yesterday en route from Rio to Paris. We are now getting reports that the Brazilian Air Force has spotted perhaps signs of debris in an area where they are searching. That debris including plane seats.

Now, this is initial reports. This is what we are hearing initially from, again, the Brazilian Air Force, that they have spotted what appears to be debris in the ocean. It's a huge area they are searching.

It began -- literally the size of the United States, but with the help of the U.S. and satellite technology, they think they have honed in on what appears to be the debris of this Airbus A-330 plane. Also, there are reports here from ham radio that the air force radar has detected signs of oil and metal in the same area.[...]

So, we will continue to follow this story, Alexis, but it appears that this could indeed be the fate of Flight 447, the Air France plane that disappeared off radar.

This area they're searching is about 450 miles off of the northeast coast of Brazil. It's a huge area in the Atlantic that they have been searching. But this could be perhaps the confirmation that everyone has feared, that the plane, indeed, went down, possibly in a storm.

They believe some -- perhaps some turbulence created an electrical short circuit. That was the last message they receive from the plane itself, and now confirmation that perhaps some debris has been spotted in the ocean.

That's the very latest. And of course we'll be following this throughout the morning, Alexis.

Back to you.

GLICK: All right, Ashley. Thank you very much. What a sad story.

All right. Well, the markets are going to be open in just a little less than 45 minutes. Nicole Petallides on the floor of the New York Stock Exchange with a little bit of a premarket preview.

Good morning, Nicole.

NICOLE PETALLIDES, FOX BUSINESS CORRESPONDENT: Hey, good morning, Alexis.

Good morning, everybody.

Well, yesterday was an unbelievable day after three months of gains for the Dow Jones Industrial Average. We saw the Dow gaining more than 200 points. It was more than 2.5 percent.

At the same time, commodities continue on their run. We saw oil at a seven-month high. It's pulled back a little bit this morning, but it's really going to be all about the banks issuing new shares.

Obviously we're going to be watching JPMorgan and American Express and Morgan Stanley. You could take a look at how they are doing here in the premarket, but certainly it's going to be all about the banks.

Yesterday, obviously, General Motors -- let me go see if they actually took it off the panel. They have taken it off of the panel behind me.

You may remember yesterday when I told you that the New York Stock Exchange moved to de-list General Motors off of the floor here. And obviously we also know that it's coming out of the Dow Jones Industrial Average, along with Citigroup, when trading is on June 8th.

So, we're going to be watching a lot of the names that have secondaries today. So, JPMorgan, American Express, Morgan Stanley, those are going to be some of the names.

Also, Barclays is making some news as well, as Abu Dhabi investors are basically shedding their stake that they bought in that company. They made some money, they're getting out. Let's see how some of these banks are faring. They're looking to the downside.

This, as futures have been fluctuating. Obviously, we knew that futures were higher, and now they have since pulled back.

Another name that we'll watch as well is Pepsi, because Pepsi obviously has given out its full-year forecast ahead of analysts' estimates. So that will be an interesting name to watch here as well.

So, some of the traders, we're expecting somewhat of a pullback after a big day yesterday. We'll continue to watch the volume to see if there's any oomph behind the moves that we have been seeing. Conviction would be a better word, but, you know, oomph is what we're really talking about. So we'll see whether or not there's new money coming into this market.

There is a lot of money sitting on the sidelines. Many folks saying that they are waiting for stocks to retest lows or pull back, while others would argue that in March, we were really re-testing the October lows, and then we pulled back a little bit more.

So, certainly there's been some good feelings here on Wall Street, and we're moving along past what we saw from General Motors filing bankruptcy yesterday.

Back to you.

GLICK: All right, Nicole. Thanks so much.

Let's go over to Charles and take a look at the Fox 50 -- Charles.

PAYNE: Yes. Alexis, thank you.

Well, Deere & Company's board announced that Samuel R. Allen will replace CEO Robert W. Lane as chief executive officer starting in August. Now, the collapse of the housing market has slowly eroded sales at Deere's construction equipment business since 2007. CEO Robert Lane has been marked with great periods of growth and revenue profits, but Deere reportedly has said that this move has been under consideration for the past 18 months.

Joining me now to break down what this move means for the Fox 50 stock is Hennion & Walsh chief investment officer, Kevin Mahn.

This move seems like a surprise to many. What does it say about the company? Is it a desperation move? Is it just a no-confidence vote in the current CEO?

KEVIN MAHN, CIO, HENNION & COMPANY: I think they appointed an insider, a very well-respected 20-plus-year veteran of Deere, and I think he takes over at a very promising time for Deere. You have agriculture commodities starting to rise now. You actually have construction spending starting to increase. And you have overall manufacturing activity which has been contracting now for about 18 months starting to dissipate.

So, I think the optimistic outlook for Deere is pretty good.

PAYNE: Would you be a buyer of the stock?

MAHN: I think over the next 12 to 18 months, yes.

PAYNE: And it looks like it's starting to turn here. The chart's not too bad looking here.

All right, well, you just brought up Dell. Let's talk about Dell.

(LAUGHTER)

PAYNE: The CEO compensation, Michael Dell's compensation, is going to increase 5.7 percent for fiscal year '09.

What do you think about that?

MAHN: Well, I'm certainly not the authority on executive pay, nor should others be, for that matter. But if you look at where the increase really comes from, it comes from his retirement plan matches, and also increases to his personal security, which apparently he needs a lot of for whatever reason. So, let's take those increases with a grain of salt.

PAYNE: No, it's interesting. I have to point out to the viewers, even though Dell's stock is down a lot over the last few years, year to date it's up 19 percent. So he could argue, listen, we're coming out of this period. They got an upgrade here recently, even I don't think they're taking any markets here.

(CROSSTALK)

MAHN: No. Technology is certainly leading the way of this recovery attempt.

PAYNE: Would you buy Dell here?

MAHN: I think I'm a buyer of technology. I don't know if I would pick the needle in the haystack with respect to technology, but certainly I'd look at ETFs and focus on technology.

PAYNE: Right, which is what a lot of people should do in trying to pick who's going to be the...

(CROSSTALK)

MAHN: Absolutely.

PAYNE: All right. Well, let's stick with technology.

Microsoft, they've got a couple of things here. They're going to unveil Project Natal, which is, I think, going after the Wii. And also, they've got the Beatles rock band.

That sounds exciting.

MAHN: Yes. I'm a little surprised they didn't pick you and I, Charles, to help debut their new project. But certainly they're going to try and recoup some of their lost market share to the Wii with their own digital gaming device. And, you know, some would argue that gaming is discretionary spending, others would argue that it's a staple. But I think that's going to pick up and they'll do very well from this.

PAYNE: You think so? I mean, listen, this is obviously popular. My son's 12 and he loves the Beatles already, but they've really never made a lot of money off of this. Do you think at some point this would become really a big segment of their business?

MAHN: Yes. I absolutely do.

If you look at how popular the Wii has become and what are the couple drags on it -- you know, I have a dog. We were discussing youth (ph) dogs. The little controller devices always get taken by the dogs or lost. With the new Microsoft concept, there are no devices.

PAYNE: OK. Now, I know you like ETFs, but if someone is out there that's considering buying Microsoft, what would you tell them?

MAHN: I would say look at where you want to get in and where you want to get out if you're going to buy an individual stock. Otherwise, just focus on technology. Look at the Nasdaq performance year to date and look at all the components of the Nasdaq right now that are leading the way.

PAYNE: Bottom line, you like Deere and you like technology.[...]

MAHN: I like Deere and technology.

PAYNE: Great. Thanks a lot. Appreciate it.

MAHN: You're welcome, Charles.

PAYNE: All right, folks. Coming up, "The One Thing You Should Know."

We'll be right back.

(COMMERCIAL BREAK)

GLICK: Welcome back.

All right. It's time for "The One Thing You Should Know."

Let's get started with Jenna.

LEE: Interesting. Just following up on Ashley's update on that Air France story. Did you know that the black box in an airplane only sends out a signal for 30 days, and then you can't find it anymore. Of course, the black box being really important to find out what exactly happened with this flight. So I didn't realize that there was a time limit on there, and there is.

GLICK: Yes. That's such a sad story.

MCSHANE: Yes, it's terrible.

GLICK: Oh, my goodness.

Charles, what is your one thing?

PAYNE: Well, earlier you were talking to the auto exec, and said you would look good in a 1965 GTO.

LEE: That was Adam Shapiro.

GLICK: That was Adam Shapiro.

(CROSSTALK)

GLICK: Oh, wow! Mr. Shapiro, that's awesome!

PAYNE: He was right. You look great in that!

GLICK: I like that car.

No, it was the guy from Edmunds -- or J.D. Power -- who said I should be in a Pontiac something. I can't remember.

LEE: Didn't Adam Shapiro tell you that this morning?

GLICK: Yes. That was Adam first. And then there was another update.

MCSHANE: He said those two always talk. On our Internet show, they can't stop. They're always talking cars.

Jeff (ph) is a big cars guy.

GLICK: He is.

MCSHANE: Knows his stuff.

GLICK: He really is.

Jenna, you're a big car fan?

LEE: Yes. That's Connell's one thing you should know. Yes.

MCSHANE: If you want to know about cars, ask Jenna.

GLICK: You just ask Jenna. I love that. I am so impressed. That's great.

I just know a lot about larger vehicles that can fit a lot of people.

PAYNE: Yes. With a third row; right?

GLICK: Yes. Exactly. I could give you a whole story on that.

OK, guys. Coming up next is "THE OPENING BELL."

Stay with us. We'll be right back.

END