all over the world? >> there's an idea. there's a business idea. multiple yacht carriers. >> yep. thank you for watching "street signs," everybody. >> it's the trickle-up theory of yacht economics. "closing bell," the most important hour of the trading day with captain bill griffeth is next. hi, everybody. we're into the final stretch. welcome to the "closing bell." i'm maria bartiromo at the new york stock exchange. this market pulling back. fears that the federal reserve could begin to taper the economic stimulus measure sooner than expected. >> i'm bill griffeth. this is shaping up to what could be a potentially very important market day. we had that big rally on the open this morning, good housing data, the fed report from chairman bernanke before the joint economic committee, but then the fed minutes came out, and it reversed itself, and we could have what's called a key reversal day, which we'll talking about coming up in a little bit here. are we changing direction? that's what we're wondering.

>> we want to get reaction on that from federal reserve critic, jim grant. he'll be joining us later. he says if you are focused on the stock market reaction to all of this easy money, you're looking at the wrong thing. also here, senator rand paul. he's also no fan of the fed. we'll talk to him about his tongue lashing to fellow senators, remember that, at the apple offshore taxes hearing. >> always outspoken. about an hour from now, dow component hewlett-packard releases its crucial earnings report. the meg whitman-led company braces the street for a drop in revenues and sales because of the cratering pc market. we'll have those numbers as soon as they come out after the bell rings. get the market analysis, the reaction in the markets, and it could set the tone for tomorrow as well. >> it's the kind of report that certainly could set things up for tomorrow. let's check where we stand right now. the dow jones industrial average, not at the low, but pretty close to it, down about 38 points on the industrial average, pull back from that all-time high we reached yesterday. check the nasdaq, looking at losses there as well, a

double-digit loss on nasdaq, down almost 1%. bouncing off of the lows, but not so far from the lows at 3470 on the nasdaq. standard & poor's looks like this, yesterday reaching uncharted territory, pulling back today to the tune of ten point. we're digging deeper into what exactly the fed said to spark this dramatic reversal on wall street. steve liesman breaking it all down for us. >> a day of confusing and somewhat contradictory fed speak, with not only the fed chairman seeming to contradict himself, but also the minutes. let me go to what just came out in the last hour, the minutes of that april may 1st fed meeting, where we learned that a number of participants expressed a willingness to reduce quantitative easing in june. participants, not voters, that's members, but still, a number is a bigger number than just several. it goes then on to say that the views differed on the evidence needed and even the likelihood of a june taper, and also within that, minutes were a lot of downside speak about the economy.

we're saying the downside risks were higher. meanwhile, earlier in the day, fed chairman ben bernanke warned first against premature tightening of policy, but then later said the fed could taper in the next few meetings. >> we're trying to make an assessment of whether or not we have seen real and sustainable progress in the labor market outlook. and this is a judgment that the committee will have to make if we see continued improvement and we have confidence that that is going to be sustained, then we could, in the next few meetings, we could take a step down in our pace of purchases. again, if we do that, it would not mean that we are automatically aiming towards a complete wind-down. rather, we would be looking beyond that to seeing how the economy evolves. >> a couple things, what's clear from the minutes, that the fed wanted to send a hawkish signal. what's not clear, whether that could happen as soon as june. economists now saying it's going to take a very strong may jobs

report to make that happen, bill. >> very important. we'll have you back, steve. we'll talk more about this important topic. thank you. let's get to bob pisani for this market today. i mean, essentially, they liked it in the morning, and they didn't like it in the afternoon. >> put up the dow. my take on this, traders are chasing both sides of the whole fed debate. yes, that comment in the minutes about the june meeting caught some people off guard and thing that strengthened the hawkish position. but nobody thinks that's going to happen. nobody that i talked to down here. most are latching on to what the fed said in the minutes. many wanted to wait for stronger data. notice the word "many." and it's dominated by doves ton voting side of the fmoc, and that's what matters. first, two points, very heavy volume today. that's important. and secondly, volatility pretty high. we're at about a 200-point range in the dow. that hasn't happened in a while. take a look at interest rate-sensitive sectors. you see reits, utilities,

telecom, that's what's down the most. that would lose the most if interest rates started moving on the upside. utilities have been for sale all months. the utilities must be down about 10%. sectors today, other than what you see in the weakness on telecom and utilities, modest declines in tech and energy materials. these are the interest rate-sensitive financials were up earlier, they're down a little bit. if your yield curve steepens, financials will be beneficiaries of that. i think the more interesting activity is in the bond market. even speculation about downward of numbers of purchases in the bond mark or in mortgage-backed securities putting a lot of pressure. there's your tlt, that's the long-term bond market to the downside. near a multi-month low. take a look at the vix. this may or may not be a signature day. it's not exactly clear. but i think it's important to note, the volume increased, the amp amplitude of the dow. >> bob, thank you very much. let's talk about this market day and the "closing bell" exchange

with heather lummis, mark tepper, michael yoshikami from destination wealth management, and jeff killberg from kkm financials is in chicago at the cme. kenny polcari with the new york stock exchange. is that all we could get? is that enough? heather, you're rotating into cash out of stocks skbonand bon? do you want to go more into equities now? >> no. honestly, what we heard from bernanke today was very balanced. in his prepared remarks, we felt that he cited some of the same things that we have been seeing, strength in the housing market, stabilization in europe, improvement in credit conditions. yet he did very strongly state that he was looking for a sustained improvement in employment. and he's going to be looking for a couple of things on that. >> so you're not going to be

impulsive at this point. >> we certainly are not. >> kenny polcari, let me ask you about what went on right before we heard the results of the fed market today. the market was ahead of this, selling off by an hour, before we actually heard what ben bernanke was saying. let's look at an intraday of the dow industrials. you can see right here what happened at noon or 12:30 p.m. eastern, we hadn't even heard what the minutes would be and the market sells off. what was that all about? >> you have to assume that either somebody interpreted or somebody knew something and word started to spread, because clearly the market absolutely reacted before the minutes came out, and so it always leaves you to wonder is who had that information, how did it get out, in the days of twitter and lincoln and facebook, it's almost impossible to figure out where it comes from, right? but certainly someone had that sense. i have to tell you, what did the minutes say rather than what ben bernanke said. he hedged himself every way. so no matter what happens, he can say, i told you so. in june, we're only four weeks

away from june. how much better data is going to come out in one month that's going to change the opinion. in my opinion, absolutely none. if anyone thinks they're starting to pull back in june wit, i think it's very premature. >> jeff killberg, what did you think of how the market responds, or even the anticipation of what was to come. >> emotions are high here in chicago and volumes are even higher, but kenny's right. there was something. because ben bernanke came out this morning and essentially tapered any tapering talk. and then someone asked him a question, would you taper, essentially around labor day, and he kind of stumbled and fumbled a little bit, and that's where people saw a little weakness. so we sold off, and right now we are seeing a technical move down there. honestly, bill, we haven't really taken a breather since we breached 1600 on the s&p. so there's a lot of back and forth technically here, but right now i don't think they taper anytime in 2013 at all. >> you don't think they taper anytime in 2013. heather, would you agree with that, that this is not a 2013 affair, but more like a 2014

affair, in terms of the tapering of the federal reserve? >> yeah. i think the market's expectations are certainly that if the tapering does occur, it will occur towards the end of the year. >> end of 2013? >> exactly. >> into 2014? >> exactly. >> michael yoshikami, why don't you weigh in on this taper tick parade that we're on right now. what did you make of what the fed had to say today? i know you like this market. >> yeah, we do like the market. as far as tapering is concerned, i think we really don't know. we can guess, but it really is going to come down to what the jobs numbers look like. the jobs numbers have been very, very uneven. if the jobs numbers -- day don't have to be very, very strong. if they're actually reasonable for two or three months, i think they will start tapering this year. and i want to make a comment in terms of what do you do from an investment standpoint. i know earlier, your guest talked about how they're moving money into the market. i think it really depends who you are as an investor. if you're already in the market, which we've been in the market for quite some time, if you're

already in the market, you've enjoyed the rally. now's the time to take some profits. pull some money off of the market. you've already made the profit. if you're in cash, i think you, perhaps start dripping into the market, but you're pretty conservative. and you spread it out over the summer, which i expect to be pretty volatile. >> mark tepper, we haven't forgotten about you, but you have to admit, you're among a cast of thousands in this segment today. what are you doing with this market? are you wanting to move further into the risk asset area at this point? >> yeah, absolutely. i mean, we think that capital is going to continue to chase yield and we feel that money is going to continue to flow out of bonds and into equities. so one of the things we're paying attention to is the fact that since march, the leaders in the market have been the defensive sectors and that really has not been justified by the earnings season. so we would expect money to actually rotate out from the defensives and into cyclicals over the course of the next several months. >> so you want -- you're among

those that's going towards cyclicals at this point? >> absolutely, yes. >> okay. michael yoshikami, everyone's talking cyclicals right now. are you as well, very quickly? >> yeah. we have actually moved a bit of money towards cyclicals. we bought a company recently, adidas, for example, which is more of a cyclical retail name. so, yes, we are actually moving towards cyclicals. we're still keeping a core of defensive, bill, because the market has rallied significantly so. >> last one to heather here. i'm going to ask where you're going. everyone's going to cyclicals. is that a crowded trade for you, or are you going there too? >> we don't feel that trade is crowded, no. >> so you go there as well? >> we would be moving into cyclicals among other things. >> okay. thanks, everybody. heading towards the close with 50 minutes left in the trading day. the dow was up 150 points at the peak and down 50 points right now. a 200-point trade on this fed day. >> do you like blackjack?

>> i do. >> so do i. after the break, we will talk in an exclusive interview with the ceo of mgm resorts. his stock up better than 50% over the last year. you might be surprised to find where he thinks even more growth comes from next. here's a hint. it's not gambling. >> i'm sorry, i misunderstood. i thought you meant jack daniels. >> hewlett-packard is the best performing stock up this year, can it last? they report after the bell and we'll have all the expert analysis you need right here. that and more coming up right here on the most important hour of the trading day, the love boat. hey kevin...still eating chalk for heartburn?

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helps him deposit his checks. jay also like it when mother nature helps him wash his car. mother nature's cool like that. citibank mobile check deposit. easier banking. standard at citibank. welcome back. the selling is intensifying. if you just joined us, we had a rally on the open this morning. it was up 150 points on the dow jones industrial average.

now we're down 58 points. and technicians are watching a chart formation build very carefully today. it could possibly, maybe, signal a change in market direction. let me show you a two-day chart of the s&p 500 index. here's yesterday. here's today. now, we have exceeded yesterday's high. there was was yesterday. we've exceeded yesterday's high. we've exceeded yesterday's low. that would be called an outside reversal day, a key reversal day. simple english, it could mean a change in market direction. will it? we don't know. but it's something to keep an eye on right now. we had a powerful rally and an equally powerful sell-off this afternoon. we'll keep an eye on it. maria? >> and we're all watching that. in fact, the federal reserve watching job growth in the overall economy to decide when and how to begin that tapering down of the stimulus. something my next guest also watches. shares of mgm resorts up more than 30% this year. take a look at the chart. delivering the best first quarter results in five years.

he also has some big plans for expansion. joining me now in a cnbc exclusive is jim mirran. thank you so much for joining us. >> thank you, maria. >> before i get into your business and the expansion plans, let me get your take on the fed. that's all everyone is talking about today as it relates to the market activity. how closely do you watch this? as a ceo of the company so dependent on the economy, you parsing through the fed statements the way we are? >> not to the degree you are, but we're covering it closely, because we're very much a balance sheet-related company. so interest rates, low interest rates are very good for us. we've refinanced dramatically over the last several quarters, rebuilt the balance sheet last year, and we've positioned ourselves for a potential uptick in rates, because we're unclear what for fed was going to do over the next six months. so we're ready now. >> so what do you think happens this year? do you think we start seeing rates tick up in 2013? do you think the fed starts that activity next year?

what's your betting? >> my bet is it's not going to be until next year. i think that there are enough cross-currents in the economy that will discourage any activity this year. it's clear, though, in our business, that the economy is improving at every price point, through housing, job growth, and otherwise. so, eventually, the fed will make a move. but i think my guess would be it will be next year. >> let me ask you about your own business, jim. for a long time, we were looking at the success of asia. you know, places like macau, you know, other areas throughout asia, as really subsidizing what's going on in vegas. is that still the situation? is the success so vibrant in places like macau and throughout asia that it actually is really needed, given what's going on in vegas? how would you characterize things? >> well, it was vital during the recession. the fact that we are having record quarters every quarter in macau was really helped us keep the lights on during the

recession in las vegas. and we're still having records in macau and we expect to have a record again this year and probably next, and we're doubling down there. we're building a $3 billion new resort that opens in 2016. the good news, though, because most of our profits are out of las vegas, the good news is the fundamental underpinnings of our business are significantly improving in las vegas and we'll make more money in las vegas, a lot more money in las vegas, than we will in macau this year and we'll be up versus last year nicely as well. >> well, that's a great change there. it's interesting that your revenue breakdown is more than 70% from hospitality and entertainment. and just over 20%, just from gaming. so, is that by design? talk to us about the shift in your focus to capture more market share? >> that is by design. this year we'll have record visitors in las vegas. we'll hit over 40 million people. and a lot of folks come for conventions. for example, icsc is out in las vegas right now. it is absolutely packed. we've never had a bigger

convention for icsc than we are this year. and that goes back to pre-recession levels. so people go for conventions, they go for great entertainment, they go to have fun with their family or friends. and a lot of them don't gamble at all. the money that we've been investing lately in the last few years has been on new entertainment, new food and beverage, renovated rooms. we're building a 20,000-seat arena right now next to city center. because people, when they come, want more of a variety of things to do. they're not just gambling anymore. although, we'll take that business. but the margins on the non-gaming business have now come up to equivalent levels to the gaming business, and that's a good business model for us, because it increases the potential customers to las vegas. >> and for a long time, you know, even the convention business stopped. it was sort of a bad word to take your company to vegas and have a convention there. has the that reversed course at this point? >> only slightly. we're going to be up this year versus last.

2013 will be a much bigger year for the convention business. and i think by 2015, we'll be back to pre-recession levels. it's taken a while to recover. you know, the big markets like new york, miami, even los angeles, have recovered more rapidly and more profoundly than las vegas. las vegas is catching up right now. and we're the home team there. so as las vegas improves, the operating leverage in my business is so substantial, that's why we had record profits in city center. that's why we had a great first quarter and we're off to a good start here in the second quarter. >> so you're looking for an okay year then, 2013? >> yeah, i'm really proud. this is a company that kirk o'corian founded many years ago. he stuck with us through thick and thin. he is the visionary that is my inspiration. and the fact at the company is doing so much better now. las vegas is improving, is a testament, i think, to the resiliency of everybody that works for us and a credit to him. >> by the way, jim, as a leader

of a major corporation, the gaming business, one of the issues we talk about, i want to get your perspective, is the corporate tax rate. no doubt you saw tim cook getting grilled yesterday on capitol hill. he basically made the case that the tax code needs to be changed. otherwise, the money that corporations have overseas won't come back. what's your take on it? >> well, the criticism of apple was totally misplaced. since 1934, justice hand back in '34 discussed the fact that we have a right to minimize what we pay to the government. it's not a patriotic duty to pay more taxes. and apple is doing nothing more than any other company should, which is accruing to the benefit of its owner, the shareholders. i do agree that we should simple any and improve the tax code. get rid of some of the loopholes, but only in combination with reducing the corporate tax rate and allowing companies like apple and others like ourselves to move money more freely across borders. that comprehensive approach is long overdue, should be done, but isolating a company or a

dimension of the tax code is misplaced and it's political. >> jim, good to have you on the program. thanks so much for your insights. >> thank you very much, maria. good to talk to you. >> jim murren. i want to point out, there's been some speculation there's been a mass program trigger. >> while you're talking, the selling is intensifying, as a matter of fact. all three major averages, the dow, the low of the day, about a moment ago, we're down to 82. the market was up 155 at the high of the session, so we've had a 230-point swing here. >> doug kass says he thinks when the s&p 500's yield matched that yield of the ten-year, that's what triggered this sell program. and certainly, it feels like a program, given -- >> the intensity of the selling. >> -- the intensity and the fast move that now we're down 80 points t s on the industrial average. take a short break, then it's a tale of two home improvement

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welcome back. target and lowe's among the big earners. today they are impacting the market. josh lipton rounds out the earnings news. >> retailers reporting earnings and some did not please investors.

target said first quarter earnings fell nearly 30%. revenue slipping 1%. weather talked about as a reason for the weakness. target also cutting its full-year guidance. on the other hand, zale, though off its highs, still up sharply in today's session, swung to a third quarter profit. david wu, the luxury goods analyst, telling me he was very encouraged by the results. former cigna chief terry berman will be zale's new chairman. american eagle outfitters, the teen retailer, posted a drop in first quarter sales. expecting same-store sales this quarter to be flat. i spoke with bmo's john morris earlier. saying investors are willing to look ahead. spring will company and these companies will do better. and there's a sense that the c-suite at aeo is being prudently cautious. and lowe's also cut its full-year profit forecast, but the stock leans into the green today. morningstar's peter wallstrom

pointing out that may comps are up 10%, so trends perhaps moving in the right direction here. stock up about 20% this year. remember, yesterday, rival home depot reported first quarter earnings that rose 18%. that stock now up some 29% this year. bill, back to you. >> josh, thanks very much. lowe's saying that all the rain in the springtime didn't help their sales. but home depot didn't seem to care about the weather. which company has the better tools to help build your portfolio? home depot or lowe's? let's talk about that in "talking numbers" today. on the technical side, rich roth and on the fundament also, it's enis taner. so guys, based on the charts, who do you like better? >> bill, we're in a bull market here. let's take a deep breath from today's 100-basis point decline in the s&p 500. when it comes to this sector, home is where the chart is. we're a buyer of home depot. you want to be a buyer on pullbacks like today. look at this long-term monthly chart. after a meteoric rise from 70

cents to $70, this stock settles into a 12 1/2-year trading range. we establish an important double bottom around $20, but in the context of that range, and recent we get that bullish breakout. rather than being exhaustive, it's really reinvigorated this stock. on the heels of that breakout, this is a stock that could trade all the way up to $120 a share over time. you want to be a buyer. >> all right, enis, what do you think? >> i totally disagree -- >> what do you mean?! >> i would not touch home depot here. and, in fact, if you look at that breakout, it's already up $20 from its long-term breakout. the entry here is a 25 times pe name, projected to grow next year. on the other hand, lowe's is a 20 pe name projected to grow 20 times next year. if you want exposure to this space or the housing trend, lowe's is priced much more cheaply. even though home depot is executed hutch better, that's all in the stock price here,

bill. >> bill, i would add, in this business, you get what you pay for. if you're not first, you're last. if i'm wrong on this call, i want to go down with the number one player in this space, the people that invented this sector. i'm a buyer of home depot here. >> i think your margin for error is much better buying lowe's where the valuation is cheaper relative to to growth than going for home depot all the way up here. >> all right. thank you, guys. good discussion. and i'll point out, the dow now down 115 points after that 150-point gain we had earlier in the day. so the selling is intensifying right now. >> it sure is. meanwhile, bill, officials in london today investigating a harrowing killing on the streets of london that may be terror related. nbc news correspondent anabelle roberts with the story right now. annabel? annabel, can you hear us? looks like annabel is not

hearing us. you know, it was an awful, awful killing. we're going to get to it, because david cameron is making comments about it, the prime minister of the uk. so we'll get back there. meanwhile, the market certainly worsening. down 110 to points on the dow jones industrial average. >> we will take this quick break. when we come back, debate over when to ease stimulus seems to be rife inside the fed. fed chair bernanke seemingly saying one thing, but some ore fed officials are saying another. when we come back, former fed governor randall kroszner is back with us with our steve liesman on just what is going on inside the federal reserve. and later, one of the fed's biggest critics is with us. jim grant joins me exclusively to lay out his case as to why the central bank is doing harm, certain more harm than good to this economy. back in a moment. tdd#: 1-800-345-2550 when i'm trading, i'm so into it, tdd#: 1-800-345-2550 hours can go by before i realize tdd#: 1-800-345-2550 that i haven't even looked away from my screen. tdd#: 1-800-345-2550

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welcome back. take a look at this sell-off, down 110 points on the industrial average. we're continuing to follow this late-day sell-off, as it relates to mixed messages out of the federal reserve. ben bernanke's testimony this morning, more dovish than the fed minutes released at 2:00 p.m.. >> so what does all this mean? is the fed chairman at odds with

the rest of his own committee? we're joined now by randall kroszner, a former fed governor, who used to vote on the fomc. and we've got steve liesman joining us as well. steve, what do you think? are the hawks circling around the dove today? >> interesting way to put it, bill. well, first of all, i think it's well to think about the total market movement here. we were up 150 or so, and now down 110. so that's a big swing. and certainly, the market got caught off-sized in terms of what the federal reserve was thinking. and what we did have was the federal reserve chairman coming out and saying, somewhat contradictory things, but ultimately, you could make sense of it by suggesting that he's saying, you know, we could be tapering soon, but not imminently. and then the minutes come out and say the number of participants, that we ought to begin tapering in june. now, that's not members. members are voted, everyone at the meeting, but there does seem to be a little bit of discord as to perhaps where the fed wants -- where the chairman

wants to guide the market where the fed is going and where, certainly, at least a meaningful nucleus of members or participants at the fmoc think the fed should go. >> but randy, isn't it all about the data? why these mixed messages given the fact that we all know that the fed has been very articulate in terms of that 6.5% unemployment rate, inflation, targeting the end of the stimulus to specific items, which have not been reached yet. what's your take on this division within the fed? >> i think it is all about the data. and i think the chairman was very clear on that, when they tried to pin him down, well, would this be before or after september? it depends on the data. and that's what it should be. it should be on how is the economy doing and where is it going. there's a big debate on whether we're having sustainable recovery or not. clear that the chairman doesn't think it's solid or sustainable yet, but some of the other members do think it is. >> i don't know what we're supposed to call you. >> randy is fine. >> i know, i was kidding.

what if they are at odds. you served at this time. you witnessed the debate that goes on internally, but it rarely becomes public in many places. this seems to be emerging at this time. what does this mean for fed policy going forward, do you think? >> well, i think legitimate discussion and legitimate alternatives are there, and i think reasonable people could agree on exactly where the economy is. i actually think it's a positive to have the different views out the there publicly, so people can debate them, people can see, paycheck different decisions on those different approaches. >> randy? >> but i think they should be listening to the chairman. >> randy, i would normally agree with you, as i almost always do. but the one thing is the uncertainty about policy. when the minutes -- when the statement says substantial improvement, it's not entirely clear that there's agreement on what substantial is compared to what and improvement compared to when. and i think that's a big part of the confusion. i want to -- i don't know if we have that comment from bob

ruska, who said, in a commentary after the fed today, he said that they're in communications hell right now, having enunciated at least three different policies as to what's going on. there it is. "the fed is now trapped in a vicious circle of communications, policy hell, and in dealing with the future, the fed already has announced at least three different policies about what its policy would be." randy, i would say, if it was 6.5%, we could follow the data. but if it's uncertain as to the metrics here, i think there's a little bit of confusion as to policy. >> and if the hawks' voices become louder and louder, you know, the fishers and so forth, have we ever had a time when the committee could disagree enough with a fed chairman that he loses a vote? >> remember, he hasn't come anywhere close to that in recent times. certainly, there has been a consistent dissenting member, but it was back a few years ago where there were three dissents, no problem there. he was able to deal with that. i think the core of the committee, the core of the decision makers are very much where the chairman is.

it's about the data. i don't think there are multiple messages coming out. i think it's about the data. i think the fed chairman said he wants to make sure that it's sustainable. we don't want to have a premature withdrawal, because we had that back in '09 and '10. so we've got to see more than three or four months worth of sustained growth. i think bill dudley talked about another three or four months beyond what we've already seen, so six to nine months. that's probably what they need before they can decide. >> so bottom line, randy, when do you think the federal reserve will start the tapering? >> well, i'm going to be consistent with what i've been saying. it really depends on the data, and we're not going to see that until some time in the fall. because in order to feel comfortable this is real and sustainable, you'll need at least another three or four months of solid employment growth in order for people to feel comfortable that this is sustainable. >> all right. >> thank you, guys. good to see you both. good conversation. good to see you again, randy. see you later, steve.

>> bye-bye. >> do you want to tell him this number here? this is big. we were down 110 a moment ago. was up 155 on the dow jones industrial average. >> what a complete reversal of fortune. we are looking at a triple-digit decline as we approach the final stretch here. up next, what bernanke says and does impacts every investor class differently. bob pisani will show us how to protect your retirement nest egg from the threat of rising rates. and apple was under attack on capitol hill yesterday, but not by this u.s. senator. >> i frankly think the committee should apologize to apple. i think that the congress should be on trial here for creating a bizarre and byzantine tax code. >> senator rand paul will be here to tell us why he took on his colleagues yesterday and not apple's tim cook. plus, of course, he's a big fed critic. we'll get more on reaction from all the news from bernanke and company today with rand paul, coming up. stay tuned. ♪

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treasury yields on the rise today, even as stocks plunge. and if you own bond funds, you'll lose money if interest rates continue to go higher. >> bob pisani is here. he's going to let you know how you can protect your retirement portfolio when and if rates start to rise. >> they are rising today and we've got a real problem. people are asking me what you can do here. the rates are going up. how do you own bond funds while dealing with interest rate risk. term bond etfs might be part of the answer. the problem with bond funds, they never mature. think about what a bond is. you get money, you loan someone money, you get paid a series of interest payments over time and at the end, you get more money back. but a bond never matures. if the interest rates go up like they're doing right now, you could lose must be when you sell. so look at ishares. they've got a brand new product out called ishare bonds. these are indexes of corporate bonds with set maturities. that's the news. you get your principal back along with a small yield at the

end of each of those years. so, for example, you've got the ishares 2016 corporate x financials, termed itf. it's paid to a index of corporate bonds that mature between 2015 and 2016. you put $1,000 in, you get $1,000 back, yields about a half a percent. this is one way to buy some limited protection against the rising interest rates that we're seeing right now. if you want more on this, go to retirement.cn retirement.cnbc.com. we've got model retirement portfolios you can look at. this is getting very relevant right now. these bond funds are starting to get serious pressure. these are some short-term solutions that people are looking at. >> although we've had the kind of volatility today, where if you asked, were rates higher or lower today, the answer is yes. >> you literally can go both ways. >> same with stocks. we were up 154 points, thanks, bob. now we were down 88 points. 15 minutes before the "closing bell" sounds. we were off of the lows, but

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all right. about ten minutes left in this trading session. we've had a big turnaround day. the dow was up about 155 points, now down 100 points. is this a signal that maybe the rally is over. are we going to change direction? >> it could be the dow's biggest negative reversal. we want to bring in stephanie link and mike spellman. stephanie, what do you think that was all about? we were up a 150 points. we hadn't even heard the minutes from bernanke yesterday, and all of a sudden the market starts to swoon. >> i think it's an excuse to sell. about 13 out of the last 18 days. and it had a nice run. so, i think today, really was not that big of a surprise. i think what we heard from the minutes and from bernanke was, they're going to be and remain very flexible.

they're going to monitor economic data points, and should jobs get better, because there's no inflation, so jobs are really it, right? should jobs get better over the next couple of months, they'll taper. but it's important that taper is not massive exodus from qe. >> my favorite tweet today from a viewer came in a few minutes ago from quiet swami. and he said, last year, 2012, was the year of risk-on, risk-off, as he pointed, roro. this year will be the year of toto, taper on, taper off. we'll be playing that game every day, right? >> oh, no. >> i think this was set up a couple weeks ago when you first heard that the fed minutes came in, that they sent up this trial balloon saying, well, you know, it may be the end. you know, qe is not going to last forever. and i think this morning, you saw this relief to the upside when bernanke said, don't worry, we're there for you. it's going to last for months and months and months. market took off. and then later, he basically said, just want to remind you, it's out there somewhere, and

the market, for the first time, has publicly heard the fed discussing tapering. and so the first really public admission about it. >> that means that the economy actually is getting better. that's a good thing. >> i agree. >> so i think it's clear that, you know, we've had a nice run, you pull back. i think you use those opportunities to buy. >> so you're going to buy on the dip? >> yeah. >> do you think there's value in this market right here? >> i do. we've raised some cash, because i think we were in a situation of kind of buyer's capitulation and everybody was buying. we got some cash. i hope this -- i think this is a very healthy development for the market. i hope we have a little bit more of a sell-off. you're coming into preannouncement period in a couple of weeks. if there are some dips there, you'll see tech become attractive. we'll put that 5% in our fund back to work. >> and you want to focus on themes. we've talked about housing, about auto, about aerospace for a long time. even the consumer. the epg electrical equipment conference in florida this week, you're hearing a bottoming in europe. so maybe you want to look there too. so this is the time to make your

shopping list. and you're among those who are looking at the cyclicals. we've been looking at that last for the few weeks. >> and they're still trading at a discount to the defensive stocks. >> where's the value that could perhaps be posed to follow? >> i think in tech right now -- >> that's where the underperformance has been. >> it's 11% versus 13% for some of the indices. but there's a reason. a lot of the companies are not in very good product cycles right now. i think there's going to be some very soft quarters again in the second quarter, but set up for a good second half of the year. i think you'll get a lot of good opportunities there. >> all right. >> we're in the final eight minutes here. >> heading towards the closing countdown. we'll see what we do hear in the last few minutes of trading. >> we're just minutes away from the hewlett-packard earnings report. these are the latest earnings. we'll have instant analysis and reaction to for potentially market-moving report. that's coming up. you're watching the "closing bell" on cnbc, first in business worldwide. [ male announcer ] this store knows how to handle a saturday crowd.

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morning, and then it completely reversed itself and we're finishing down $13. we were up in the $1,400 and $1500 range. now to the dow, in this case, the s&p, two days, we were above yesterday's high, we were below yesterday's low. the question, maria, is, will they buy this dip this time? >> it also goes to show you how sensitive this market is to any move in rates and a real move we saw today. let's talk right now with ben willis. and ben, earlier, we saw this market swoon, even before we heard what bernanke was talking about. >> somebody appeared to have heard. >> what the heck happened there and why are we closing down so significantly? >> we got a very early indication with bernanke and what his thoughts were in the pre-release, but then in the commentary, when he said, we could be changing rates or tapering within the next few monthly meetings, that was verified with the fmoc meetings minutes that came out. i want every investor in america to look at that ten-year chart.

that tells you that you lost money today in the safety of the bond market. you have to be aware of that. that's going to be your biggest risk as an investor right now in this environment. >> do you think it's significant that we had this rally on the open and then the powerful sell-off in the afternoon? >> yeah, it is. from a technical analysis, it's important on a daily reversal. so taking out lows of the day, the technical side is telling you there's some worry here. i believe what we'll see in the tapering, we'll se tsee the benefit. but that should be the benefit to a long-term investor. you're seeing money being chased out of the market. but that to me is an opportunity to be an investor, not a trader. >> what is this close, down 95 points, if we close right here. to tell you about how we open tomorrow. >> i think we will take a breath and recalculate where we are. but i'd keep an eye on the ten-year yield to give us an idea of where we're going.

i continue to look for that correction. it's not a bad thing to have a correction. i think it's a buying opportunity. not to buy the dip, but as that yield starts to creep up, you're going to see the fast money start to move around in the asset classes and keep your shopping list ready of the stocks you want to own, because that's going to be the time to buy them. >> it happens so often that it's on a fed day or a fed-related day that we get these hinges, these moves one way or another, these change in direction for the market as they rethink what their strategy is going to be. >> and the central bank has been the driving force for whatever country we're in. obviously, big ben bernanke has had the impact around the world. so we are the leader in that sense. but the fed has always been in that case and we're starting to get an understanding where we now have several members talking about tapering as early as june meeting. again, look for a stock market correction, but have your buy list ready. >> again, are you seeing any new money coming to this market, or is this just a reaarranging of

the deck chairs? >> this is fast money trading. and those people who have decided to make the allocations in their 401(k) on a monthly basis, you'll see that in the first days of the month and that's probably not bad time to lack at it again. >> i'm going to head back for the next hour. hewitt packard earnings coming out. good to see you. and the alliance of floor bro r brokebroke brokers ringing the closing bell. >> hewlett-packard are expecting 81 cent a share a profit on revenue of $21.01 billion. that could set the tone for tomorrow. that's been the best-performing dow component this year. >> absolutely, great performer, especially when you put it up against the like of apple. that's what he said earlier. we've seen money tiptoeing around the technology sector. it's very broad sector. but the hardware sector performed beautifully. going to take a bit to continue that trend. >> thank you, ben. >> pleasure. >> see you later. you're going to hear a lot of applause from the floor today because of a beloved floor broker here at the new york

stock exchange, bob newburgher, celebrating 100 years ago. he's 100 years young today and he's ringing the closing bell. stay tuned. you've got jim grant, the great fed critic and earnings from hewlett-packard on the second hour of the "closing bell." i'll see you tomorrow. it is 4:00 on wall street. do you know where your money is? i'm maria bartiromo on the floor of the new york stock exchange. investors getting taken on a fed-fueled roller coaster today. the market soared to new sights, but sold off after mixed messages from the federal reserve and talk of a sell program kicking in late in the day. take a look at how we're settling out today on wall street, with the dow jones industrial average down 81 points after being up 150 points in the morning hours. buying picking up as well at the end