we have steve liesman set up and the markets are ready to go. thanks very much afraid the fed is not delivering the clarity you seek. the meeting was split. few members saying the feds should be patient before tapering. other members saying they should stick to the plan laid out in june and saying it might be soon in time to paper. almost all participants were probably comfortable if the economy improves as the fomc as

expected. several participants were willing to consider a lower threshold if the economy needed that. they cited higher mortgage rates and oil prices. global growth and fiscal restraint in the united states. a few were concerned about a mim diminished higher wealth effect. that was something that i haven't seen before.

a number said hey, it is near to stay below 2% for a long time. it is a reason for keeping monetary policy highly competitive. if it gets to that level we agree not to raise interest rates. the fed debated the reasons for the rise in the interest rates and it discussed a fixed rate full alotment. rejected adding certain ideas to the statement. overall, it is telling us the fed is not ready yet to make that typering on the decision. it would seem to be not a real

clear signal here. it doesn't seem to be a full complement onboard in september. >> we are seeing market reaction. the fed itself is never actually used the word "taper". that is our word correct? >> yes, that is correct. stocks we are seeing a move in the yield and the dollar is close to a session high. clearly the market is hoping for perhaps more clarity. >> let us bring in zane brown. i don't know if you were admonishing me but your takes are selling off? >> we need more clarity here. the markets are largely expecting a taper.

they are expecting for the fed to stop bying treasuries. not on the bond market on the municipals i'm sorry on the mortgage market and also there is increased talk and chatter that larry summers might actually be a serious candidate to take over the -- there are a lot of reasons that the markets are nervous right now. the split in the fed itself doesn't help the markets. and we didn't get anything that said actually we are going to give ourself the escape clause. >> the market wants more clarity. the market would love the federal reserve to come out and say at this time we are going to do xy and z.

they are not going to want to say anything that is too commit al that paints themself into a corner. they will have an opportunity to look at what the market was looking at. if i start in september maybe i

only do five or ten not 20 or 25. >> guys, can i point out something here? >> i want to caution against making any interpretation about how the market views these minutes in the first 15 minutes, after they come out. there is a lot of blocked box training that comes out. few human beings about the decisions. i would not draw the conclusion about what the minutes say. i think this is clearly about they would do it. i think the market reaction. the amount of volatility that surrounds fed announcements in the first 15 minutes. you could be 50 points up or down by the time we meet the bottom of the hour. >> it does take a little time for the market to digesdigest.

if you listen, what you are seeing here is a drop. we have the yield up. rick santilli make sense of it for us. >> i have to disagree with steve. pea attention to the market. 154 to 162. hovering at 161 i can't tell you how key this is. it is a great indicator. 10 year they were unchanged to 281 we briefly printed 289.

it is improved and make it is at the stimulus here. right now, the fixed income markets are totally at their key levels looking to extend into the neutertories. >> i was come pairing the june minutes to the minutes we got just now. the language around the asset security purchases, exactly the same. always looking for changes which is what those computers you ref res re rensed are the ones we trade on. should we view any change on that idea. not from these minutes.

i guess i would throw back that idea. the market is moving. i would point to is there a rational reason for the market to move here. what is it seeing here? maybe what it is not seeing? >> well, i think that what the fed is portraying here is as we portrayed it. the fed is split be patient and wait for the data to be patient. we announced the plan in june and the fed's language is symmetrical on this. a few say stick to the plan. perhaps the market wanted more consensus on the side. you could come to that conclusion. this morning it is down more than that now. what are they saying?

>> the important thing is that the first head line there, they split over the taper. now this increases a taper light. instead of going from 85 to 60, maybe you go from 85 to 75. you want to start tapering but don't have enough to do an aggressive part of trapering. i agree with that. it is not just the retail sales number. last week production numbers were weak. we had the single family housing starts that were below expectations. the numbers were not clear at all. the numbers were still fairly t tepid. right now we are down 78 points

and steve is right. what happens here is within a half hour to an hour the, initial reaction often changes course a little bit as you revert to a mean a little bit. that is a common characteristic of the first hour. it was 122 points to the downside. we should note that the dow has lost all of its gains. >> i want to highlight, sorry for looking down, they did add a line here, guys, they were talking about the housing market. they said conditions of the housing sector generally improved further. they added this line. as expenditures continued to expand, that was not in the previous minutes around housing. it is getting better. that is a tossup to anybody.

go. >> i think it is interesting why they think that is the reason. why the economy is going to be fine. it is the most interest rate sensitive issue that anybody makes. >> who was trying to jump in there? >> if you look at the housing numbers, starts came up with a good head line number. but starts were down 2.2% in july. building permits were down 1.9%. so yes, when the fed met. maybe they still had this echo effect of activity in the second quarter. but since that time with the ri ri rids in interest rates. since the beginning of may mortgage rates are down. we hope the fed takes that into

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♪ mattress discounters! you have some policy-makers who would soon think it was time to be patient before we do anything like that. this is the reaction we've got. the dow is up 59 points. it was down by 122 points. it is now down only 59. the ten year spiked and sitting at 2.855%. ken, i don't know if you heard our previous segment. they acknowledge things are

picking up brisky. some trying to poo poo them saying hey, probably the last chance to close on contracts before rates. >> the numbers were very good. they represented closings but even though interest rates are up they are still low relative to where they have been. we think there will be slower thubs mo numbers moving into the fall. they are kind of old now. the rates back in july were lower than where they were now. no question these are numbers that are about six or eight weeks old. the newer numbers won't be available. you won't see august numbers

until october or november. the first reaction is that people rush to go and buy and lock in. people can switch to shorter term mortgages. they can switch to a 7 or 10 year mortgage and those rates are still in the mid 3s. it is not over at all. they can switch to shorter rates where they can get a lower rate. prices are going to go up. the number of new sales will slow in the fall but still be better than it was a year ago. >> i want to peel out something that peter noted in the numbers. the median home price was up 17%.

>> it means that affordability were less affordable today. they could afford to buy. it is not sustainable. we expect it to slow. the sustainable level to grow. 13 or 14 is not sustainable. >> don't you think the rates should make anybody nervous? >> this conversation take advantage of these lower rates it reminds me a little bit of 07. is this a really good development sir? >> i'm a person that likes to lock their rate long. it is as risk to the system, you are absolutely right. >> isn't it through the majority

of people stay in their homes ten years before moving on. for people who believe they may not be in their home for ten years or more it may be a rational decision? >> the average move is six or seven years. >> with the rates where they are now, it is not a rational or all but it is more risky. >> gina what would you be doing with that part of the sector overall. >> this is not sustainable. this will largely be -- rates are still low i agree. and the affordability is still there. beprobably have a long time to go. they will be buying them at a slow rate.

there isn't a whole lot of organic demand. >> okay let's get out of the weeds hold on guys. i'm listening to this on syrius satellite radio. what do people do because of today. long-term bonds don't look like they are going to add value anytime soon. i think you reexamine what you

have in fixed income and go down in maturity. if you focus on having your coupon higher than your duration that is a drop. >> bottom line, are rates as low as they are ever going to be? if you are sitting on the fence do you rush out and buy now? absolutely. mom, dad -- >> thank you both. >> still ahead. which left for dead stock has actually doubled? here is a hint for you. right now, 7 years of music is being streamed.

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number two we don't have a huge amount of clarity in terms of what they are going to do and when. the dow is off by about 74 points. and we have got the ten year

note you have 2.87% which is higher than the 2.81%. let's bring in president fred tomsik what do the minutes from today mean for the retail investor? >> i'm not sure the average investor is looking for them a lot. it is the same. there is a plit. but clearly, in our view it is getting better. but there is a lot of uncertainty right now. >> so you say you don't think it has a huge amount of implications. what the minute said today none the less how do you think the market is going to perform from

here? >> there is no question the economy is getting better. people are generally bullish. i think right now there is a little bit of nervousness. are we going to have a short-term correction. if we have that correction i think people will come into the equity markets in a big way. >> do they feel themselves that the economy is getting better or they look out there and say weeks ago stocks were at record highs? >> if you look at our customers they would say that they are bullish. but if you look at what they did in july, they pulled in, our clients turned in less bullish.

people are looking at the housing market at improving. it looked like people were putting more money into the markets or is that a reflection of more money because stocks are higher. >> so that $11 billion has nothing to do with the market. that is net ins versus net out. td ameritrade continues to be a ben fishery of that. people take advantage of what they see as a long-term trend. >> thank you very much for

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all week here we have been looking back to look forward. over the last five and ten years we are hitting the 15 year mark. what is the best performing sector it is energy. up 244%. the one and only sector to come close to cracking that 200 mark? so what sector will shine 200 years from now. to both of you great to have you

on the show. look into the big crystal ball which is going to be the best performing sector? >> we like the tech sector. increased pent up it solutions to demand. attractive valuations and based on historical levels, the tech sector is trading at an 11% ratio. it has been at 23. that 23 is up. >> you asked this question yesterday. inside the tech umbrella what ones do you like? >> mobil cloud software. the innovation and technology is producing solutions and innovations. >> what do you bet on?

>> my auction 2028 calendar is built so you can't have me back. >> come on. >> i think it is an interesting question and you know, the 15 years is long enough so that demographics can take hold. one is consumer discretionary. as the consumers become more of a consumer driven demand we think they will be in good places. >> i want to ask our team to put up the graphic that was up when mandy introduced the segment. consumer discretionary was second. higher energy prices will destroy everything and yet look at the two best prices.

>> that is what we were talking about. the us but the rest of the world, we are looking for significant growth there. they are hard to invest in but they will do nicely. the other one is health care. once people have their protein based diet they will get heavy and fat and want better health care. they are well situated. >> what is going to be the worst performing sectors? >> it won't exist. >> i actually thought about it. when i talked with my clients i want to highlight the best performing sectors. they boil down to future growth

strategies and attractive valuations. we look at the sectors and that is how we approach it. >> can you answer the same questions? >> you know i took a look back since 1989, financials are the worst performers by a long shot. maybe that has some impact there, financial services are so massively over purchased and over supplied really because of increasing regulations. that would be a longer term. >> gentlemen, both thank you. i'll give a shout out to steve. he said watch out for the

initial reaction. and guess what, the s&p 500 which fell, now positive the nasdaq is also positive. the terrible fed minutes were not quite so terrible. >> it is only down by ten points. quite a come back. still ahead, the jekyll and hide retailer. yesterday they told us the consumer was just fine. today not so much. plus, can you name this stock. it is up more than 100%. street signs. sweet them in. but first bill griffith what is coming up on the closing bell? >> the ten year yield is still at the high. ups says it will no longer provide to the spouses of some

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welcome back everybody so at the beginning of the show steve leash man said hey, don't looking at initial reaction of stocks because it is often times machines that are directing training. i commented on that. so he runs out here and i love it. it is live tv we don't know what is going to happen here. we are trying to get steve back. >> i'm ready to book. i looked at five years at fed minutes.

the conclusion i reached was don't bite. i didn't think anyone saw it. don't bite. and or go the opposite. that is a gutsy call. when you see great calls, derrick jeeter would compliment a-rod. this was an amading call. >> the guy has the most -- hey, i wish he played for the phillies. that guy nailed it and this is the best nailing i have seen our network do. >> that is a massive slap on the back for you steve. >> thank you. i have been doing this for a while. the way the market reacts to the gdp number. the only trade that is correct to make to an important number is wire to hear is one on

volatility. it goes like this. the simple thing that i don't do is make the call on what the minutes say based on how the markets react. you believe the market will react rationally to the data. you don't know how the market was positioned. in this case i did not see a more hawkish case. the only one that would have made sense was the market reacting to the lower market forecast. so the minus 122 is something that if i could have traded i would have hit it harder as if a risk officer would have let me. >> you knew what the market knew or what knew it was supposed to be looking for. what was the inside of what people were looking for. you read it and said this is not

warra warranted. but not that severe reaction. you spent every second of your life doing it. here is something i would like you to explain. the equity markets had a knee-jerk to the downside. the yield spiked higher. they are at 2.86%. and the five year is on the grill. if you are looking at target's numbers and macie's numbers. we were too positive and glib. as yields rice i want to make a point about this. it is time to talk about the

stuff that matters right now. the bond guys are the guys who want to be taking it first on the chin. the volatility in the bond market that comes from rates being higher and why there would be greater voltility in the market. there is the question jim to wrap it up with this which is yields and the stock market. when bond yields rise where can we expect this to go? >> i don't know if this is a real move or not. it should be accompanied by

activity which justifies it. it justifies it by 2.2. it slowed in this country. that is what matters to me. and you can't have rates go up and not think that they are going to go down 10%. >> i agree with jim on this. i'm going to say that we are going to see 265 on the ten year. i think the market has over done it. on the base forecast the ten year looks to be fairly valued right here. there is going to be that volatility inside the tapering. if you want to get out, a higher point. >> where do you think things will be at the end of the year.

i think 260 to 285 range is about right. >> i wouldn't peg it with an exact number. i think the bond markets to reject. you and i were on squawk on the street. we asked him point blank and said why do we approach this like that. the fed will sell bonds and then we will end sell iing bonds. they could start buy iing bonds again. if they were meeting in conference calls jeez the application is down and sales are down. last month has been bad and we are so worried about washington

and ma macy's walmart and targe are america. >> we love it when you do that. none the less still over it's record high. the last four summers we have had a swoon. this is meger. up next battleground group on.

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it is riddle time, folks. can you name this stock? it is up for than 100% since january. yes, many of you have already correctly guessed. it is groupon. a big comeback this year. can it be sustained? julia boorstin has been digging in. >> reporter: mandy, ever since the ceo mason was ousted, wall street has gained confidence that the company can transition

to be a true mobile local e-commerce player. the company gave wall street another boost of company when it appointed co-ceo lefkofsky as permanent ceo august 7th. it doesn't mean the company is out of the woods just yet. groupon does struggle with the international business, and it faces significant competition in the more mainstream e-tel space, but it's showing the strategy of diversifying away from deals and towards selling discounted products is working. the gross billings grew 10%, nearly half of groupon's north america purchases were completed on mobile devices, and direct e-mail marketing is becoming less important. accounting for less than 40% of groupon's north american transactions. now, groupon shares closed 21% higher the day after it reported earnings, but have pulled back significantly since then following on news that management took profits and cut its investments by 72% in the

second quarter. now, the pressure is on for groupon to keep delivering growth, both in the united states, but specifically overseas. mandy and brian? >> julia boorstin, thank you very much. we cannot, of course, talk about a comeback story without a hardy debate, or at least a quick one. irvin is joining us, has a price target of $12, and andrew making a bear case, a market perform, neutral rating. do this kind of quick. arvind, how does it get to 12? what is groupon now? >> well, i think groupon is participating in two very powerful secular trends in e-commerce, those being local and mobile. i think the opportunity in front of groupon is much bigger than most people realize, and as julia was pointing out, on mobile, this is such a natural extension of their business. almost 50% of the business in north america comes from mobile, and internationally, it's growing very rapidly.

so two powerful trends, and it's also turnaround story that is working with north america billings having accelerated, tech rates getting better, operating costs in check. so a different company than most people are thinking. >> aaron, build the bear case here. why is arvind wrong? >> i won't say it's totally wrong. i will say the local -- the core local business is still in decline, about 4% year over year, positively the u.s. business has stabilized. we're not seeing a return to growth yet in the core locals business. if you look at the groupon goods business, that's growing 50% year over year, but essentially 0% margin. so we're less positive on the future outlook on the goods business, more positive on the local operating margins. i haven't seen the growth return yet, and international still declining. i'd like to see that business reaccelerate to get more positive at this point on groupon. at these valuation levels. so now the stock is up 100%, now you're trading at 30 times earnings at 2014, 13 times ebitda, not what it was at $35 a

share earlier in the year. >> all right, arvind, aaron, guys, quick, concise. we appreciate the discussion. we'll get you on later for more in depth. thank you. >> thank you. let's send it over to josh for a quick "market flash." >> reporter: the headlines are just dropping from reuters. a lawyer with the fed now saying that the regulator will appeal a ruling by a federal judge that overturned a cap on credit card swipe fees. remember, that rule mandated by dodd-frank limits fees that banks charged when you use that debit card. you can see some of the names, visa actually up 4%. near session highs right now. mandy, back to you. >> thank you very much, josh lipton. coming up next, a sobering stat. about wine. [ kitt ] you know what's impressive? a talking car. but i'll tell you what impresses me. a talking train. this ge locomotive can tell you exactly where it is, what it's carrying, while using less fuel.

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here's a very sobering thought for you. low alcohol wine, if you haven't heard of it, you will, because apparently, this is a booming business. low alcohol meaning 5.5% alcohol by volume, and regular class is 13%, 15%, so the market for this has grown 70% over the past year in the u.k. alone. and australian vintage, the wine company recently launched a global line. a lot of people apparently like this, because it has a lower calorie count. i'm on board with that. 45 to 60 calories as opposed to 90 for a regular glass. would you be on board with that?

>> no. >> lower skcalories, lower alcohol. >> three things, one, what's the point. number two, b, that's groupjuice, cheaper, by welch's and you know the songs that make you want to light a bic over a fire and stab your eyes out. this song, i want to gouge my eye out, throw it across the room and stepped on it. >> it's like coffee without the caffeine, chocolate without the sugar, both things i abhor. i like my full caffeine content, please, every morning. >> yes. ♪ red, red wine >>. >> let's look at the markets. a wildfire with the fed minutes, the market fell. the dow is down exactly two points, which is .01. the s&p and nasdaq higher. the dollar index is higher. 10-year treasury yield, as mandy noted, the continuing story of the fed minutes. the yield is higher to 2.85 percent. moving to different languages here. we're going to continue to watch the markets.

of course, the market degegs of the fed minutes going all the way through to the end of trade at 4:00 p.m. today. in the meantime, we'll sign out from us here on cnbc "street signs." "closing bell" is next. hi, everybody. we enter the final stretch. welcome to the "closing bell." i'm maria bartiromo, and the stock market coming back. >> it was down 122 at the low. now we've come back. trying to snap a five-day losing streak and avoid closing below 15,000 for the first time since july 3rd. so we've got a lot to cover. i will point out the 10-year note -- yield has remained at lofty levels. it got up to 2.88. it climbed by six basis points just like that after the minutes came out, and we're still just off that high of the day. >> a lot of the headlines coming out of the minutes, basically said they i