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no more orange pasta at dinnertime. well, angry food bloggers want kraft to take out dye that's used to make its mac and cheese. 160,000 people have already signed a petition so good-bye glowing yellow cheese. that is it for "street signs." i'm back at 5:00 p.m. for "money in motion" and "options action." see you then. hi, everybody. rock 'n' roll on wall street, welcome to a very special edition of the "closing bell." i'm embroko at the new york stock exchange where we wrap up a historic week for the stock market with yet another gain, possibly another all-time high. >> so far. i'm bill griffith. it's the final hour of a week that literally has been one for the record books. if the dow has any kind of a gain again today, not only would this be its fourth consecutive all-time high, but the dow would also be higher all five days

this week, something we've not seen since september of 2011. >> really extraordinary. >> it's been a little while. >> how good is too good for this market? are investors worried that strong reports on the economy such as today's jobs report will cause the fed to start winding back the free money party? is that why we're not up more today? rick santelli and steve liesman will get into that coming up. >> that alone is pay-per-view material and more reaction to maria's big interview yesterday with black rock boss larry fink who predicted a 5% pullback for stocks. remember, he was ahead of the curve last fall when he was talking about everybody should be getting into equities. that was in october. he was way ahead of the times. we'll see what he says. >> really was. says longer term works cares what happens in the next few weeks or few months if you're in this market. pretend 20, 30-year periods so still very much bullish on equities. bullish day. 50 points higher on the dow jones industrial average. 14,380 last trade there. nasdaq composite also double-digit move here, up 11 points even on the nasdaq at

3243 and the s&p looks very similar. looking at a steady situation the last couple of hours or so. bill? >> let's talk and kick it around with our guest. the stat master himself rich peterson from is & p capital iq and quincy crosby also joining us at the big mark, mark lacheney and derrick jones all joining us. regale us with some stat about this stat that we've gone through. >> as a fan of the s&p 500 i'm saying we're not there yet. 1% away from a record high for the s&p 500, so great week. since the italian elections, up 4%. had a very strong week for m & a and strong week obviously for equities and the jobs numbers today. really, real took everyone by surprise but that's the fly in the ointment now. if we're getting closer and closer to a 6.5% unemployment rate the fed is targeting for when they would get back offer q

sgle put this back into perspective for us in terms of what we're seeing and what's behind this. as bill said, you are the stat master. inters of m & a and cash on balance sheets, you just gave me a great stat in the commercial break. ten straight quarters where the s&p 500 companies have more than $1 trillion in cash? >> right. and the other stat is the fact that there's only been a handful of times when the s&p 500 has gained 5% or more in the month of january. >> right. >> those subsequent times from february to september the average gain has been 14% so that gives us optimism for movement upwards. >> off to a good start, quincy, but we've come very far very fast, right? >> we have, and no doubt there's a pullback, but the key is do more investors then go in. are they sitting and waiting for it and then do they have the confidence to go back in in the credit markets have been very, very accommodating for the equity markets' riskier assets, and that's what we need to see. credit markets, keeping a nice underpinning for riskier assets. >> rates are so low in the credit markets that it makes the stock market that much more

active. >> that also. the italian elections, we had that little blip. the markets don't want to see the credit markets giving us a warning. >> daryl jones, how do you want to allocate capital here? >> you know what, number one, we think you want to play u.s. consumes. we have what we think is a very strong outlook for the u.s. dollar so that will be very good for the u.s. consumer. the other thing you and i have talked about, maria. u.s. housing continues to accelerate to the upside. core logic home prices last month, up 11% year over year so any derivative play on housing is where you want too play. be long and overweight u.s. equities. >> mark, you hanging on to this gain? what are you doing here? >> yeah, absolutely. under a scenario analysis we do d part of our outlook 2013 piece we painted a probability we'd see 1680 on the s&p 500 so given that outlook we're kind of constructive >> when would you see 1680?

>> by the end of the year. >> wow. >> and we're on path for that at this juncture, and it's really on a couple of factors. one is equity risk premium compression due to macro economic risks receding on a domestic basis. capital spending revival and housing recovery and consumption continuing to do reasonably well, if not remarkably, given the state of the consumer, and as a consequence though not only do we think u.s. equities are appealing, non-u.s. equities to us even look more appealing because of more attractive evaluations. >> non-u.s. equities meek what, equities, international equities? >> maria, international equities, particularly in the epicenter of the sovereign debt crisis, europe, and even in certain select emerging markets, particularly eamerican inning asia and namely there china. >> quincy, what about you? how would you allocate capital to keep a part of this rally? >> we'd be basically in the united states, but we also agree the dollar, vis-a-vis the euro is becoming very attractive for european stocks.

as long as growth stabilizes, some of the huge companies will get a bid with the euro. >> one of the anomalies of the market later, the leadership group has been the financial sector, but when you go back to the last highs we set in october of '07, the financials are the big laggards. they are still down roughly 50% over that time. do you expect them to play catchup at some point? >> well, not only the financials, bill, but also i.t. i.t. is the laggard year to date. 4% for technology versus health care is up almost 11%. you look at these metrics. the march '09 lows, the late great mark haines are called for four years ago. almost every sector of the s&p 500 is up 100% or more and if you look at october '07 to present, only four sectors are up led by consumer discretionaries and staples. >> do you think it represents buybacks for the rest of the

year? >> i think carl icahn says so. >> buybacks, dividend hikes and m & a and where we are now. going back to m & a and looking at past records, looking at highs, 2000, m & a was 1.6 trillion, although/time warner deal. another deal in '06 and '07, private equity. we're nowhere near a bubble. >> i think you uttered a wow when mark said 1680 on the s&p this year. do you see it going this high? >> we've definitely on the bullish side of things, and i think where that does actually come into play the economy is still very slack, so if the economy real starts to accelerate to the upside, which, by the way, some of of the recent data points, that's where you get a number like that in the short term. if the economy tightens up, but the risk obviously is the fed might, you know, get out of the way which people are concerned about in the short term. >> does today's number change your mind in terms of when the

fed starts winding back given the fact that the employment number is definitely much better than everyone expected? >> much better. economists like to see trends. one month does not make a trend. they are going to make sure that it is gaining traction, and then they will start talking about using words about the overall economy, making it stronger, better. the ten-year yield has crossed over, too, after the data came out this morning. we expect it to see higher, but the fed is even talking about keeping their balance sheet exactly the way it is and letting run off so that the market doesn't suffer dislocations. >> have to run here, folks. let me take a quick survey. everybody likes this market of the four guests we have here. who expekts a correction and how much of a correction do you think could happen? rich? >> we could be in a quiet period. 95% of s&p 500 companies have reported earnings. not going to see earnings coming back until april. alcoa coming out so don't be

surprise if treads water near term. >> quinci? >> a 5% to 10% correction, a geopolitical risk, a credit market-induced risk by the eurozone but you'll see new investors come in. >> mark? >> i think 7%, plus or minus. i think we could see any number of those factors including perhaps a little bit more noise coming out of washington with regards to the continuing resolution and what, if anything, is going to be addressed with the sequestration, so as a consequence that could be the catalyst, but nothing definitely, you know, life-threatening. >> and daryl jones finally. >> we don't see a correction, you know. this is still one of the most hated rallies, and we think sentiment is negative, and the market will continue to go higher. >> we'll leave it there. thanks, everybody. appreciate your time today. >> thank you. >> and we'll see you soon. the dow industrials on track to close at its fourth consecutive regard high today and other impressive winning streaks at play as well. let's get to josh lipton with the background. >> reporter: marking momentum clearly to the upside here.

another record high for the dow. the blue chip index on track to close higher for the tenth straight friday in a row. the russell 2000 index, small-cap companies, also trading up to a record high. some of the biggest movers in that group this week immersion mgic investment and home oowner choice. in the broader market, the s&p 500 hit a new five-year intraday hie and the s&p on track to close higher all day this week. something we haven't seen since last august. the s&p mid-cap 400 index traded up to an historic high as well, and the nasdaq composite trading at a fresh 12-year high. also worth mentioning here, the financials, nearly 30% of all new 52-week highs today are in the financial sector, including dow component bank of america, citigroup and regional banks like regions financial. all-time high for asset managers including franklin research,

t.rowe price. bill, back to you. >> 50 minutes till the close. the dow, any positive close is an all-time high and the s&p now is 15 points away from its all-time high. >> wow. larry fink has been calling this record rally months ago. he was right, so is he correct again when he told me this yesterday exclusively. >> i would not be surprised to see a 5% correction here, and, you know, we are seeing a slowdown in flow, especially etf flows in the last ten days from the record setting flows we saw in the last quarter, january and february. >> we'll get into that a little later on in the program. >> also, today's better than expected jobs report is just the latest sign that the economy is improving. when we come back, liesman and santelli duke it out on whether that should mean the fed should start easing up on the stimulus efforts sooner than the markets would like. >> call citigroup the comeback kid after it aced the stress test. find out if it's time to hop

aboardth citi bandwagon. that's coming up on the "closing bell." [ with stamps.com] you can print real u.s. postage for all your letters and packages. i have exactly the amount of postage i need, the instant i need it. can you print only stamps? no... first class. priority mail. certified. international. and the mail man picks it up. i don't leave the shop anymore. [ male announcer ] get a 4 week trial plus $100 in extras including postage and a digital scale. go to stamps.com/tv and never go to the post office again.

welcome back. jobs data coming in better than unexpected and the unemployment rate is at four-year lows, but stocks are off of their highs today but still showing a very nice move. >> yeah.

some may worry that better than expected economic data could mean the fed may take the cheap money punch bowl away is this a risk that could be reality? let's duke it out. two people that know this story better than anybody, our own steve liesman and rick santelli. steve, what do you think? >> i don't think so much. i think there's a lot of slack in the labor market. the fed has made a commitment to remain -- to keep purchasing bonds and keep quantitative easing policy in place past the point where we think it's already needed, partly because there's been all these false starts before, bill, and i don't think this is enough to move the fed or meet their criteria of substantial improvement in the labor market. one more thing, i think that you could have a rise in the participation rate in the coming months if the job market is really improving than could raise the unemployment rate. >> rick? >> let's look at the number today. believe me. it was much better than expected, no doubt about it. but we now move back over 40% in terms of the number of people

unemployed that have been unemployed for over 27 weeks. if we had the same labor force participation rate we had when the president was first sworn in, the unemployment rate would be very close to 11%. having said all of that, i think -- >> you just agreed with me. >> you make it sound like the fed is not going to pull back any time soon, rick? >> well, i'm getting to that. >> okay. >> the point is that i think things can always be better and five years into this crisis i think it's all disappointing. it would take five years at the present job rate to get to where we were before the crisis, but one thing that makes no sense is how this ties in to the criteria i disagree with and whether that criteria, the fed means they should stay or they should go. there is no crisis. why they are still in crisis mode is beyond belief, and i think it's wrong. >> rick, 40% of the people out 27 weeks or longer, and some 7.7% of the population

unemployed. the u6 is 14.3% of the problem and that's the crisis. there's a crisis of unemployment in this country. >> and how is the fed addressing this crisis? >> the fed is addressing it the only way it knows how, by pushing down long-term interest rates. >> the only way it knows how what you say after that is an experiment. >> absolutely. >> i don't think we should have that experiment. >> we should have an experiment to put people back to work. >> why are you an apologist for this organize significance? >> you are, you absolutely are. >> put america back to work, and you know what? >> and let america get back to work the way the country has put people to work ever since it started to be the shining light on top of the hill, without all this micromanaging european style banking! >> steve in, terms of looking at these numbers and sort of peeling back the onion in terms of the participation rate, what does this tell you about the sustainability of this recovery?

and how many -- how many months in a row do you want to see numbers like this in order to feel like we're moving the needle, that we actually could start change the fed's behavior? >> part of the problem is we don't understand the dynamic of the declining participation rate. we've done three of the past several months, we've done north of 200,000. at the same time the participation rates continue to fall. we know that some of that is the result of the aging of the population. another piece of that is discouraged workers. i think you're going to have to do 200, 250, even 300 for several months to come, and i happen to know the federal reserve believes it has a large margin of error before it gets to a point where slack in the labor market decreases, and you have a problem with -- with wage-driven inflation and that's the thing it's on the lookout for. >> rick, i'll play devil's advocate by asking a question that probably has no answer and needs to be asked anyway. where do you think unemployment would be if there was no fed buying program at this point, no kweezing?

>> oh, i think -- of all the dynamics, including today's report would be significantly better. what wouldn't be significantly better would have been the one year following the crisis, that would have been worse. on the mend sam zell style, hit a real bottom and everything would have been healthy and we wouldn't have these dumb discussions about where where would stocks be, might be or interest rates should be because all of this is a country game. >> it's not a parlor game. >> and it deserves better than federal experiment. >> it's a parlor game. show me any proof that what they are doing really makes any difference at all. the economy is better despite them! >> why do you sit there and cover the interest rate markets if they don't matter? if lower interest rates are insignificant -- >> markets do matter. the fed matters less. >> what are you doing there, there, twiddling your thumbs, i don't think so? >> give me a break. apologist for the fed. why do you stick up for these --

>> i'm not sticking up for anything. >> experimentation. >> saying what the policy is and the reason for the policy, and over four years, rick, i've yet to hear a better answer from you. >> this economy doesn't need wise men from ivory towers. >> we'll let you go at this point, but we just did notice, at least you guys are wearing the same suit today so you agree on something. good to see you both. you did not disappoint. >> thank you, guys. have a good weekend. >> heading towards the close with 40 minutes left and we're heading higher again. the dow was up 83 points. that euphoric rally on the open this morning following the jobs number, it has since pulled back but still a healthy gain of 60 points. any positive close is a new record today. >> have you looked at your 401(k) lately, bill? >> as a matter of fact i have. >> this market rally making people very happy to open that 401(k) statement. most are back and then some from the depths of this crisis. coming up we'll hear from

someone who says 401(k)s are hurting more than they help the debate. stay with us. >> citigroup topped the banks in the very last stress test. goldman sachs passed but not with flying colors. when we come back, we'll get the trade on which stock can help your portfolio makes the winning grade coming up. (music throughout) why turbo? trust us. it's just better to be in front. the sonata turbo. from hyundai.

goldman sachs passed but not

welcome back. most of the nation's largest banks passed the fed's stress test with relative ease. courtney reagan is looking at how the big banks are trading in the wake of the results. >> reporter: without a doubt citigroup is the most improved player. shares are up more than 2% since yesterday's results showed just how much the bank shored up its capital position. this year analyst think sti will have no trouble getting approval. two regional banks, bb&t and suntrust surprising analysts with their stress test strength. no news is good news for the regional banks. shares of state street and byn melon moved higher. bank stocks taking it on the chin today are the ones with the biggest capital market businesses as the fed used a severe stress model. one assumption used is the stock drop of 50%, and that hurt the firms that rely mostly on trading. goldman, jpmorgan and morgan stanley. these three came out of the

stress test. goldman at the bottom of the heap and goldman sachs shares were sent lower today. today's stock performance aside, analysts do expect them to approve capital plans of all the nation's top six banks next week. bill? >> security, thank you very much. which bank could be the best buy in light of the stress test results. st citi, the most improved or goldman sachs? let's talk numbers. goldman versus citi. on the technical side j.c. o'hara and fundamental side abigail doolittle with the seaport group and a cnbc contributor. abigail, would you buy either of these two banks? >> bill, perception is everything, and i think that these bank stress test results are likely to shift investor perception of risk in favor of citigroup and away from goldman sachs. citigroup looks more bullish. when we dig down on citigroup we see they have been doing all the right things, cut operating expenses and increased bad loan

reserves and increased overall capital. all this makes it more likely that the fed will approve the bank's request for $1.2 billion buyback next year this. will support shares. i think we're looking at a $55 to $65 stock over the next 12 months. goldman, on the other hand, looks like a trading black box. their ratio was well below the firm's estimate. 5.7% relative to goldman's 8.6%. this does not breed confidence. investors will be nervous about this, and i think that you're going to see these shares trade off, maybe down to 135 or so, especially dpepgd on what happens next week if they do make a buyback request. more bullish on sti and not very much on goldman. >> j.c. what, do the charts tell you? >> i agree with be a gail. look at a chart of citi and one of goldman and put them together, they are the exact same chart so i can't say i like one better than the other because in essence, it's insane,

look at chart. look at the chart on the screen, going back to 2011 and you normalize, it they are exactly the same. yesterday you're actually seeing some divergence with recent headline news. citi trading up 3% and goldman down 2.5%. >> are these favorable charts in your view, or not in. >> i think both of these charts are going higher. >> i think that the lack of divergence that you're talking about, v.y., we could see a little bit of a break here. if we look at valuation, citigroup trading seven times price-to-book value and goldman at 1.06 times, and i think we could see a little bit of a shift there, seeing citigroup trading up closer to its book value near $64 and goldman trade down near 143, if not lower. so i think we could see a divergence with citi going up and goldman going down just on this sort of shift in perception and then also that valuation shift. >> i agree with you. but the correlation over the

last two years have been extremely high. 0.8. i, you know, use an exam. go to yankee stadium and look at the big screen between the innings, see the classic subway race, one subway verse the other subway and who gets there first. at the end of the day both are going in the same direction. >> that's true right now, but goldman has really had the tailwind of, you know, being the best bank on wall street and really recovered from the financial crisis. citigroup has had an even better run over the last six months than goldman being the black sheep. now it's the shining star so when you put that together with its valuation discrepancy, i really think we could so citigroup trade up here and goldman start to trade down a little bit. >> very good. looking forward to the subway races at yankee stadium k.only mean spring is right around the corner. please, let that be the case. thank you, both. have a good weekend. >> final stretch of trading. 30 minutes left in the trading day. we do at this early time have an indication of the buy side as we approach the close.

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out there in the world, so we do everything we can to be there for them when they need us. plus, you could save hundreds when you switch, up to $423. call... today. liberty mutual insurance -- responsibility. what's your policy? welcome back. good news today from the labor front with the economy adding 236,000 new jobs last month. certainly beating expectations. >> indeed, but with 12 million americans still looking for work, our next guest says we still have a long way to go, and he's not sure we're going to get there unless things change this washingtonch we welcome back the former chairman of the council of economic advisers during the final years of the bush administration and now he's professor at stanford university's graduate school of business. welcome back. >> thank you, nice to be with you. good to see you. >> what do you think needs to change in washington to improve

the labor market? >> well, if we look at the labor market, you know, obviously these numbers were good, and we're certainly happy about them. i would say the most important point that i would take from these numbers is that they are all moving in the right direction, so, you know, these come from different series and different questions and different surveys, and the fact that the unemployment rate was down, the fact that jobs were up, the fact that hours of work were up, all of that is a good sign, but the reason that i am concerned is that the overall picture still remains pretty bleak, and the easiest way to think about that is if you look at the number of jobs created since the turnaround, we're somewhere around 5.7 million jobs, sounds pretty good. >> right. >> the problem is that you need 5 million just to keep pace with population growth, so we're really not very close to where we need to be, and if we look at the long run situation, we're still in pretty deep trouble. >> so, let me ask you, ed. do you think that this kind of a number, such a strong employment

report today would actually be the beginning of the fed changing its behavior. would they start to look at these numbers, and i recognize what you're saying, look, we're not there yet, and there's a lot more to go for improvement, but just looking at the job numbers is this the beginning of the fed saying let's start about thinking about winding this down? >> well, i think if it were sustained, the fed might start thinking about that, but you have to remember that the month-to-month variation in jobs numbers is really very significant, so, you know, i know ben quite well. we served together, and i'm sure that he and the other fed governors are looking at this carefully, but they are also taking into account that you need to see sustained development in order to change policy, so i'd be very surprised if they were inclined to shift, at least for another few months of continued -- if this continues, great. >> right. >> and then i think they may think about it, but not in the near future. >> let me go back to my first question, what you feel needs to change in washington to improve

the labor markets. to this point we're relying almost exclusively on monetary policy. i gather you want to see more on fiscal policy, yes? >> i would like to see essentially four things happen. one is the budget. that's the obvious one. people are talking about, that the sequester is a part of it. we need to improve our tax policy right now. we don't have a very pro-growth tax policy. we need to move in that direction. our trade policy needs to improve. one of the nice things i think that the president talked about in the state of the union is improving trade between the united states and you're. that's a good start, but we've got, again, many, many different areas that we need to think about, asia in particular, and then the fourth would be getting a more rational regulatory policy. i don't think our regulatory policy has been particularly productive in terms of helping the environment, helping grow the economy, and my sense is it probably has been negative in terms of investment by business. >> what about the sequester? what kind of an impact would these government spending cuts

coming, what kind of an impact on jobs will that have on later on in the year in. >> minimal. first of all, it's a relative small number if you look at size of the sequester. it's smeller than the typical growth in the budget. if you go back a year or two, we grew the budget by 150 billion to 200 billion and talking about cutting somewhere in the neighborhood of 250 billion in the next ten month and 85 billion overall. small numbers relative to the tote a. i'm not a big believer in the effects of changes in expenditure on government growth. did it when i was in the government, and to be honest i don't think that the policy was particularly successful as we look back on it, and i don't think that the ones that president obama enacted in the early part of his term have been particularly successful, so rolling that back is not going to be significant in terms of economic growth. in the long term, maria, i would say that, you know, this is a move in the right direction. unfortunately, the discretionary spending, as we all know, is a

relatively small part of the package. >> right. >> we need to get on the entitlement side and get that in a more rational direction and get some control over that. until we do that we have a significant drag on the economy in the long run. >> you have a president that wants to close loopholes and a congress unwilling to do anything and the gridlock realistically. ask what kind of tax reform we would like to see and what kind of tax reform do you expect to get? >> well, closing loopholes may bring in some revenue. when we say loophole, that's a very loaded word. i spent a year thinking about tax policy before i was president bush's chief economic adviser, and let me tell you, you know. what is one person's loophole is another person's incentive, so that's not -- that's not an easy thing to do, but primarily that -- that's a tax increase, and that's not a pro-growth policy. what we need to do is we need to think about ways to encourage

investment. the easiest way to do that is to think about what -- what we usually call full expensing of capital so that you allow businesses to invest without taxing that investment or at least moving in that direction. that would be a pro-growth policy. what we did to capital gains recently is -- and dividends is a move in the wrong direction to my view. >> good to see you. thanks for joining us, ed. >> thanks, ed. >> thank you. >> we'll see you soon. >> heading towards close, 20 minutes left here. looks like we'll do it. looks like we'll have an unprecedented week. any positive clothe is a new all-time high. >> deja vu. >> all this talk all week has been about the dow closing at record highs and also not too far from an all-time record for the s&p 500 but another index hitting a new all-time high blowing the dow out of the water since march of '09. that's from the bottom. that's next. >> also, are dell rivals hewlett-packard and lenovo looking to buy dell? both reportedly looking at

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if you think the dow owes record run is impressive, you're right. the blue chip index is up 119% since the march 2009 lows. >> however, that is nothing compared to the russell 2000 bob pisani point out. the shawl-cap index has skyrocketed by 173% since the market bottomed in 2009, and it's hitting new highs again today. mr. pisani? >> yes, and isn't it impressive. the russel is outperforming the big-cap index, up like 8.5%, but russell is up almost 10%, 11% so far this year. very impressive to watch it. one of the reasons small caps tend to do better is as a perception that the economy is growing, small caps usually tend to outperform. >> so they tend to leave the market then? >> that's the very good thing about it. the russell, and those had a don't know, it's 2000 small-cap stocks. don't think that's like an amazing number. actually a very small amount and typically they are $1 billion or less in market cap so you're only owning a small part of the market. the average market cap is

probably 50 billion or 60 billion so you're only owning tiny companies. the great thing is on the markets, when the economy is going up, these tend to outperform. the down side it's a little more volatile than the s&p 500 and you don't get as much international exposure. these companies are local. they don't sell to pakistan and india. >> i know we throw this word smart money around, but it's typically the smart money that goes to the small-cap stocks first. they are the ones out there beating the bushes looking for the small companies and identifying where the growth opportunities are. >> they can turn around very quickly because their fairly small. you can invest in these. etfs with available. put up the iwm, the main exchange-rate traded fund mere oregon the s&p 500. >> the russell 2000. >> excuse me, the russell 1000, fairly low cost to only whole thing, and, again, your risks here are if the market gets volatile, this can get volatile, too, a little more volatile than the s&p 500.

>> you want to own small-cap stocks. it's a different section of the market. >> you're going to have somebody that's going to come up here and say is it too late to buy them though, when you consider the gains that that index has had especially since the march of '09 lows, just this year had an incredible gain as well. >> you have to have a thesis and a directional idea about where the markets are going. if you believe that the u.s. economy is continuing to expand and that this is only the first part of an expansion in the u.s. economy, you definitely want to own small-cap stocks. if you don't, might want to revisit that idea. >> part of that diversification process. jump in any time. >> have 15 minutes the closing bell sounds. >> happy international women's day. you're wondering when you can wish bob and i happy international men's day. i looked that up. it's november 19th. >> i thought every day was men's international day.

>> 14,401 is uncharted territory. we're looking to close at another all-time high. >> and it would appear retail investors are really starting to pour money into this market but jpmorgan says they are 100% late to this real. he's here with that warning coming up next. >> also, is your retirement and risk if you rely too much on 401(k)s, and somebody says yes, even though 401 ks are doing great. back in a moment. (ann) to help me plan my next move, i take scottrade's free, in-branch seminars... plus, their live webinars. i use daily market commentary to improve my strategy. and my local scottrade office guides my learning every step of the way. because they know i don't trade like everybody. i trade like me. i'm with scottrade. (announcer) scottrade... ranked "highest in customer loyalty for brokerage and investment companies."

too late to get into this game. according to joe taney from jpmorgan funds, the retail investor at this point is over 100% late to this rally. so are people about to get burned? he joins us now along with our friend david darst from morgan stanley wealth management who has his own reasons not to get the retail investor in this market right now. let me start with joe. why do you say they are late? >> let's just clarify. not saying it's too late to get into the markets and they shouldn't be getting into the market. many people ask if the retail investor is finally starting to participate in this real, and, of course, you look at fun flows, we're starting to see the retail investor start to participate. does that mean they are just wrong? i don't think they are wrong but i just mean they are late. you missed a 100% rally, doesn't

mean there's anything left but they are unfortunately a little bit late. >> tell them what you just told me. >> i think this is like a cocktail party and as joe just said the party has been going for several hours and if you want to enter now it better be a cameo appearance, come in and have a quick cocktail. >> the hors d'oeuvres are out, booze getting watered down. >> there's a bear market check list. are we entering a recession? no. is the fed tightening? no. is investor euphoria present? >> no. there's froth, but it's not a bubble. >> right. >> are valuations stretched? >> no. are transportation, bank stocks and the transportation bank and the small caps doing poorly and getting beaten up, no, and finally are bond spreads widening? no. they are actually narrowing versus treasuries so on all six of those say that this party could continue for a little

while, and you've got to enjoy it but realize that you better sort of have a quick snack and be ready to take off. >> this is really amazing. earlier we said there was a bias to the buy side. that's what we're seeing. we see the market trading up as we speak. only ten minutes before we close, and we're up 76 points. there's 1.3 billion to buy right now on the floor according to art cashin. which sector do you think is still right in terms of valuation right now and which is stretched? >> from a valuation standpoint and lock at defenses, so many investors have been searching for yield over the past couple of years with very, very low interest rates, obviously their value as is look a little bit stretched. on the other side, if i look at some more cyclical areas, areas like technology, large-cap stocks in general, i think they continue to have room to run on the back of some attractive valuations. >> you have had a laundry list of stocks for a couple of years that i've been back here to buy. would you still buy them at

these levels? >> can you buy them and you want to get things where you have momentum behind you, okay, where you have tailwinds pushing you, slum jay, halliburton and mexico is going to begin drilling for oil and all this batchen shale, all the shale plates. this is good. you can't touch that oil and that gas without baker, halliburton, schlumberger. mexico, we like mexico and we like japan hedged. maria, we started talking about that at the beginning of the year. would you believe this, maria, it's up 17% so far this year, and we think it with run another 40% to 50% if mr. abe continues with this reform. he's got a 70% approval rating now. >> i think it's interesting because, you know, this is a story where japan has been down and japan hasn't seen money flows for years. suddenly it's a sham and looks like the economy is on the side of investors. >> the household sector in japan

is sitting on $16 trillion worth of cash, and they are only 6% allocated to equities. in the u.s. it's about 32%. we had a trend, a theme emerge this week on this program reluctantly bullish. reluctantly long this market. a lot of guys coming through here saying we're still long this market even though we're reluctant to do so because of these valuations and the level where we are. are you among them? >> i think i understand that point of view. if you think what investors have had to deal with over the past few years, so much macro uncertainty, it's been scary getting into this market, especially distinguish the roller coaster ride. now you've got market levels, different market hitting their all-time highs and the s&ps. >> 13 points now. >> although we're barely hitting the all-time highs in price, we eclipse all-time highs in profitability well over a year

ago, so from a fundamental standpoint the underlying momentum remains in place. >> italy, china, watch the international situation. i think if there's anything that could perhaps. look, the debt -- the debt downgrade is another possible warning sign if we have one more the united states, but the fact that the house is passed, this continuing resolution through the end of search the, that takes us to the background. if that's given a green light, profits, want to see profits come through, 70 out of 100 is warning about the profit outlook so you want to see them be proven wrong and profits surprise to the upside to continue staying in this market. >> all right. >> great. >> good to see you both. >> thanks so much. see you soon, guys. >> david darst and joe taney joining us. coming back for the closing countdown for this historic week and the dow heading back. >> and this is from a buffalo zoo and the cub's name is luna

and later meet a ferocious market bear warning investors to get out of this market right now. it's coming up on the "closing bell." you're watching the "closing bell" on cnbc, first in business worldwide. [ male announcer ] i've seen incredible things.

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and his new boss told him two things -- cook what you love, and save your money. joe doesn't know it yet, but he'll work his way up from busser to waiter to chef before opening a restaurant specializing in fish and game from the great northwest. he'll start investing early, he'll find some good people to help guide him, and he'll set money aside from his first day of work to his last, which isn't rocket science. it's just common sense. from td ameritrade. okay. hello, maria. you there somewhere? >> we're at highs of, above 70 points and a minute ago we were

14,404. it's come back a bit, but got to look at this as an enormous victory. going into the weekend, bill, more money coming in into this market. >> the dow was up 83 points on the open after we got that much better than expected jobs report. let's put things in perspective, and here's the market today. this was the rally on the open this morning and gave it all back right away and thought what's going on? now we drifted higher just off the highs of the session here with a gain of 60 points. let's put things in perspective, maria. what do you think? the dow, this being an all-time high, we went back to october of 2007 this week and took out the old highs and were setting new highs as we go. >> the s&p, we're getting closer, the old high was 1565 and now we're at