they already have wearmart. >> are you saying chinese would pirate somebody else's idea? that's shocking. that's outrageous! >> that would be it for "that's outrageous." great to have you with us. great to have you with us as well. thanks for watching "street signs". >> now we're going to send it to a show 100% fox meat free. "closing bell." have a great weekend, everybody. >> welcome to the "closing bell." i'm kelly evans on this friday at the new york stock exchange. where a few brave souls, including this one, made it in today. >> maybe we should have shown the photo i tweeted a little while ago. >> it's empty out there. >> i took a picture of wall street. it's 14 degrees. i said where are all the tourists? it's empty. >> not the hardiest of souls. >> day two of 2014 for the stock market. if only we could call yesterday a mulligan for stocks. they're looking to close the week with some gains. we do have a gain today of about

50 points after that first day selloff yesterday. >> the dow has been up and down today. now adding 50 points as we enter the final hour. keep an eye on the nasdaq which is in the red. it's had the worst performance to kick off the year. a lot of component, apple, gool google microsoft, not holding up well for the last couple of trading sessions. >> technology not playing along well this hour. >> ben bernanke this hour. >> yes we do. >> he'll be delivering what some characterize as his farewell address. steve liesman telling us in the last hour the headlines from those prepared remarks. but in a little while, there will be a q&a session. those often can make market-moving news and it will occur in the final minutes of today's trading day. we'll take you there live when that gets under way. >> good point. those headlines didn't move the market when they hit, but we have heard comments which are having more impact on market today. >> more concerns on the troubled

obamacare law. new reports that newly insured people may end up going to emergency rooms more not less as the white house predicted. if that holds true that will throw costs way out of whack for this program. we'll get reaction from a top administration official whose entire job is to get the implementation of this law to be smoother. >> this is on front page of all the major newspapers this morning, this study you mentioned. it goes back to oregon where they randomly assign some people coverage. the results are pretty interesting for the future of that law. let's get back to markets right now, though. a look across major indexes. dow staging late-day comeback. 50 points shy of the 16,500 mark. take a look at the nasdaq. as we mentioned, it is the laggard today. this year it's down by only a couple points. we'll see if things turn around there. finally, the s&p 500, some small gains. it doesn't do much to get rid of the selloff we saw yesterday, bill.

again, a lot of people talking about the weakness in these indexes for today, for yesterday, and whether that -- how that bodes for the rest of the year. >> i know it's only the second day of the year but it's one we keep an eye on here. joining us let's talk about today's markets in our "closing bell" exchange with erin gibbs from spi capital, stone, david kudla from mainstay ken mahoney, and rick santelli from rick santelli -- >> asset management. >> something like that. >> erin kelly and i were talking yesterday, we forget how different the mood was last year at this time going into 2013. i mean, last year there was a lot of fear going into the year. this year a lot less fear. you agree? >> yeah to say the least. this year is really the mirror image of 2013. last year we had nothing but a lot of roadblocks to get over between the sequestration, tax hikes and so on.

this year it looks like we're firing -- starting to fire on all cylinders and the expectations are significantly higher. >> what makes you so confident the indexes will keep rising from here? >> so the main thing is earnings expectations that's number one. right now we're looking at earnings growth of about 10% for the s&p 500. so, with those kind of expectations going into the year, we still expect us to be in positive territory by the end of the year. on top of that of course we've got gdp growth finally inching up 3% still low inflation. so we see everything looking towards a positive year. >> ken mahoney, you agree? >> look i think we'll have a positive year. most people expect the s&p earnings and growth between 8 % and 10%. there is some giddiness with room to concern. reminds me of late '90s. they would call our office and

say, buy me shares of yuhoo? what are you talking about, the chocolate drink? yahoo. we are getting some calls in the office again. my nephew told me to buy the company that tweets or twitter, what's going on there. >> no kidding? that's like our shoe shine anecdote here. >> overall, i think the market will go higher. when there's fear, that's -- warren buffett talks about so eloquently. i think the market will go higher. investors will be tested this year. i think this means more volatility, more correction. i think a good shakeout to test the fortitude of investors this year. >> it just occurred to me speaking of warren buffett, when you compare today right now this period to the mid to late '90s warren buffett's buying stocks now. he didn't in the . >> he still likes valuation. he likes valuation. >> david kudlow what do you like into 2014?

nervous? >> i'm not nervous about the stock market maybe not as nervous as others are. we think we'll have reasonable earnings growth with revenue growing 4%, 5% after being flat this year. you know that bodes well for earnings and the opportunity for multiple expansion. and the economy is improving. we expect significant improvement in the economy next year. that takes us to industrials and other cyclicals. the cap ex, we expect that globally companies will be spending -- will have capital expenditures so the cap ex cycle we've been waiting for will -- >> and keep waiting. >> and keep waiting and keep waiting. but we think that finally comes in 2014. and that will help the tech stocks and some of the other capital expenditure, those beneficiaries of cap ex cycle. >> today's interesting microcosm or a test of that thesis because financials are doing well and yet technology, again, if you look across the nasdaq the last

couple of sessions is really under pressure. what's going on, david? >> well, we've got the selloff yesterday, come back a little today. probably just some tax loss selling at the beginning of the year. we're not going to make too much of one day. as far as the financials though, that's one of our favorite sectors in 2013 that continues to be in 2014 with net interest margin increasing. we like the banks. we like industrials. we like technology. all those global cyclical plays will do very well in 2014. we get through a couple days of digestion and we'll see an improving market. >> hang on one second. bill stone, we haven't forgotten about you. we have breaking news for just a second. phil lebeau stepping in with the latest automotive sales news. >> all the numbers have been tallies. auto data says the december sales pace was 15.4 million, that's below what many on the street were expecting. they were expecting something closer to 15.9 maybe 16

million. the real important news here is that the total number of sales for all of 2013 15.6 million. that is the strongest annual auto sales in the u.s. since 2007. guys, back to you. >> phil all the same that does take the bloom off the rose to see that big of a drop in december. and i understand people are citing the weather on this one. but, you know, that raises hackles for everyone who has heard that excuse in the past. >> right. but i think the ultimate thing you want to look at here is the trend, when you take three months at a time. if you look at the three-month trend for auto sales, it continues to move higher. let's see, if we see this continue in january and february, then perhaps it's time for people to be a little worried about the consumer. >> phil, thanks very much. we'll see you later. bill stone, that's the kind of news that we -- that the markets essentially would have ignored for the most part in 2013 because they were still on the morphine drip at the time. you feel like we're going to be focusing more on fundamentals, though n 2014, right?

>> i think we are. but i think he's right to say you do still have to keep in mind the trend. i think what some other people talked about, i think it will be more challenging this year because you do have higher expectations built in just because of the valuation of the market. but we feel like the consumer's in really good shape, honestly in terms of net worth, gains. we'll see at the end of next week what the nonfarm payrolls look like. but i do think it is going to become more pay attention to maybe more individual company dynamics rather than as much as the macro environment, perhaps like we saw last year. >> speaking of that macro environment, rick santelli watching the ten-year flitting back and forth between the ten-year level, is that significant? >> you know, i don't think it is personally, kelly. i think the treasury market at this point is pretty much shadow boxing what's going on in the equity. equities improve, rates move

higher, home base continues to be around 3%. next week tuesday, wednesday, thursday we get the first set of treasury auctions. 3s 10s 30s $64 billion. that will be interesting. first top tier employment data on thursday. i can't see how 2014 is going to be as good as equity markets as 2013. there's no doubt the empty is improving. i think one guest said firing on all cylinders. i agree but it's a sedan versus a lincoln town car. that's the problem. i think this inventory impact on gdp, that will dissipate quickly. i think by the first or second quarter of 2014 we'll come to realize the solid 3% gdp numbers are probably a little optimistic. >> before you -- we let you finish up here what -- what kind of response or demand do you think there will be for the treasury auctions next week bearing in mind they're the first ones being conducted on

that scale after the fed announced tapering? you know will begin this month. what do you think? >> i think the three-year will go pretty well. i think the longer maturities i would be concerned about so i want to see what the demand is. i know the old argument as ratsz move higher you bring in a new crowd of investors. i think the duration risk as we get into a real taper, maybe closer to quarter year, midyear, i think it will take a little out of the long-term demand of the auctions. >> erin you get number like the auto sales hit, that's a pretty big step back. do you read further into that to try to change any tactical positioning as well? >> no. again, i do poo-poo that a little bit because of the weather in december. and, again just looking more at the trends. so auto sales are not one of our bigger concerns. >> what about that sector generally? it's been one of the strongest -- one of the bright spots for the u.s. economy here. people have been able to get loans, financing is there

allied financial may be coming to market early next year. >> across the board, consumer discretionary, it's hard to find good values. we're starting to look at other sectors for where we're going in 2014. all the high fliers from 2013 the internet retails, autos and so on, it's challenging to really look at these valuations and say, do i think this is going to be another winner in we're going to move on here. we have news getting ready to break. thank you. happy new year. appreciate your thoughts. meantime, ben bernanke wrapping up his remarks. they'll get to the q&a in a little while. two more speakers before they get to that. we'll wait to see. we knew about the prepared text. no big surprises there, but you never know what he'll be asked and what he'll say to those questions. >> that's right. definitely stay tuned. you're not going to want to miss that. that's all coming up in a couple moments. >> meantime, 50 minutes left strengthening a bit, getting back to the highs of the session

with the dow now up 70 points. we're back above 16,500 today. >> the only significant news in the last couple of minutes of disappointment in auto sales. curious market here. >> art cashin keeping eyes on things. >> it's flat. this buying we're not seek a lot of bias one way or the other. he says they're looking toward the bernanke q&a session coming up. coming up bank of america on google the shares a little lower today. someone here will join us to explain why, perhaps, the stock brawl is coming up. also, general mills is going to begin selling cheerios without controversial genetically modified ingredients. we'll look at both sides, whether that's a good thing or bad thing businesswise. if you want better returns for your portfolio, invest in companies with good looking

ceos. marissa mayer. >> or jamie dimon. >> it's fun to talk about, so we want to know what you think about ceo looks and if that's actually something investors should think about. your best tweeteds will be revealed later on the "closing bell." keep it right here. [ male announcer ] this is the story of the dusty basement at 1406 35th street the old dining table at 25th and hoffman. ...and the little room above the strip mall off roble avenue. ♪ this

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stocks started strong lost altitude and now we're seeing a pick up. >> airline is a big winner in 2013 and also a big winner today as delta reported better december traffic and passenger revenue. then the same time last year. that's leading the whole sector in a big way. all up better than 5%. from travel season to flu season and right-aid higher as well. they saw rose 3% same store sales. sprint downgraded saying potential merger with t-mobile would have a hard time receiving regulatory aimprooufl. the fate of that sector still

unclear. herbalive herbalife after ftc said they would hold a news conference on weight loss products. general mills will begin producing cheerios without again etdicily modified cornstarch. they said it's because consumers may embrace it. they're not changing their overall stance on gmos but only for the flagship cheerios product. >> coincidence or not, a corporation called green america had been pressuring them to do something like this. yes, they are responding to something out there. kayla, thanks very much. let's talk about it. is it a good business decision to ditch genetically modified ingredients? joining us collin o'neil director of government affairs at centers for food safety and mark conley not so enamored with this. collin, why is this a good idea? >> i think it's a strong

business decision for the company. recognizing the two major trends within consumers these days. consumers want more information not less. and they want foods without genetically engineered ingredients. >> but i think this is bad for general mills potentially if it looks like they're trying to have it both ways. it's only one kind of plain cheerios, not a companywide policy. they still may be tainted by being exposed to gmos and they haven't said anything about it more broadly. doesn't take the savviest consumer in the world to figure this out. anyone who cares about this issue will look at this and not think there's much more to it. >> this was certainly a decision made because general mills and cheerios in particular the brand reputation and brand image was on the line. general mills in the past two years has donated over $2 million to fund anti-consumer campaigns to defeat mandatory labeling at the state level. consumers know this. they received a lot of pressure to do something about it. >> but it doesn't even apply to honey nut cheerios. >> i agree. we would love to see general

mills do more and beyond just nongmo and go organic as well. >> mark, why is this a bad idea in your view? >> it's clearly a risky move. on the one hand we're saying we're giving consumers what they want but are we really giving them what they want? we're giving them what people are telling them they want. i think if we add the gm-free label we should add a note saying we're using a lot more pesticides on american farms. one of the benefits of gm crops is we use more pesticides. >> it comes down to do consumers feel safer with something that's been sprayed by a pesticide or engineered to be pesticide resistant. shouldn't the labeling be there for those who really care about this issue? >> that's really the question. is this -- the implication of this move is that genetically modified free crops are safer. and what we don't know is whether they are. i've got three kids. i would love to know whether it's safer. >> does it matter if consumers have enough of an issue they would at least like to say you

know what, i want to express my preference to avoid genetically modified crops. shouldn't a good business respond to that and take advantage of it? >> the question is what are they really responding to? if we told americans the truth we're going to apply a lot more pesticide and a lot more pesticides in their food and river, they would have a different attitude. gm-free is a cute buzz word but doesn't tell what's going on. >> you can tell from the line of questioning, i'm on the fence. i was telling kelly earlier, am i going to get sick if i eat genetically modified foods? >> first thing's first. genetically engineered cropses have increased pesticides on american farmland. we've seen an increase in over 300 million pounds of pesticides as a result of adoption of genetically engineered crops. >> i don't want to get -- my aside cart on that issue. that's certainly important but the big picture s the reason any company would suddenly say they're not going to do this is because people fear the impact it will have on their -- on their beings by eating this

food. am i going to get sick by eating genetically modified foods? >> to answer your question we don't know because there's no premarket safety assessments conducted by the food and drug administration. and in the absence of mandatory labeling, we have no tracking of any health consequences. if there are any unintended health effects, whether they be allergies or any other health effects, we can't track them. and health professionals can't track them. >> i have to agree with that. >> yeah, you agree with that right? >> if there's one thing wrong with activist and environmental movement, they're demanding labeling without evidence. what we need is more evidence -- >> this almost goes back to the issue when it comes to for example, banks, what's wrong with tans parency. tell us what's in the food so we can make our own label. >> if gm-free labels say contain more pesticides that's fair. >> 99.9% of genetically engineered crops grown in the u.s. produce pesticides or can withstand exposure to

pesticides. they sell more pesticides. that's what the gmo machine was designed for. >> we get these buzz words marketingwise. i mean organic. what exactly does organic mean? my daughter unfortunately, suffers celiac so we're looking for gluten-free. as someone wrote, why label something as gluten-free. paint thinner is gluten-free. are you going to put that down as gluten-free as well? i go bigoing with genetically modified free foods, aren't you pandering to some degree to the public, mark? >> the epa was against mandatory labeling of genticily modified ingredients because they consider it misleading. it is misleading because there's no science behind it. >> mark at the same time japan and china have both sent u.s. crops back whether it was wheat or corn most recently because they contained genetically modified variations. so, if it's a big enough issue in those markets, shouldn't

americans at least give serious thought to whether they should think through this kind of exposure here at home? >> both of those issues were specifically ingredients that were not approved in those markets so they were justified in sending them back. the broader issue is we need some science. what we know is that pesticides can be dangerous. what we don't know after eating genetically modified food for 25 years is if there's anything wrong with it. there's no evidence and yet we put labels on it. it's a scarlet letter and make nos sense. >> before we let you go as analyst here tell us what you think this means for investors and general mills. is this a boon because they can cite transparency or avoid this legacy issue or do they come off looking bad here? >> we'll sell more cheerios but this is a difficult thing to navigate. if they get pressure to move their other products there's a lot of switching costs and consumer costs to pass on. >> general mills is an influencer. that could affect other companies as well in this issue

too. gentlemen, thank you. >> fascinating topic. appreciate it. >> i guess i do have an opinion. >> half an hour left to go before the closing bell. bill will be checking his labels in the pantry. >> what's in this coffee? >> exactly. dow is up 73 points at this hour. perhaps some anticipation of what chairman bernanke may be saying as he gives what may be his final speech here coming up in a couple minutes, q&a portion. >> art cashin saying, maybe there are shorts out there that don't want to be short this market just in case going into the weekend. google shares up 50% over the last year. now one wall street firm is making a very bullish call on that stock, lifting the target price to $1250. that's $100 from where it is right now. can google keep heading hire? a good old fashioned stock brawl coming up on that. moments away from one of ben bernanke's last question and answer sessions before leaving the fed.

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we're waiting -- we're looking at each other, waiting for the other person to talk. but we're waiting for ben bernanke to begin the q&a session which should get under way in 10 15 minutes. at american economic association there in philadelphia. it's having some darin the anticipation of the q&a session

is having some impact on wall street. as art cashin was telling us there's probably some shorts out there that are perhaps fearing, if you're short this is market that ben bernanke would offer a bouquet to this market, as art put it in the last minutes of the day. we've seen that movie before to mix metaphors, from the last year. they may want to stand aside here. we've had a modest rally going into the last few minutes of trading with the dow now up about 63 points at to hour. we'll get to the q&a session when it gets under way. some good news for cincinnati bengals fans. >> as of just a few minutes ago, according to an official tweet from the bengals twitter feed those three nfl playoff games that were at risk of being blacked out because they hadn't sold enough tickets, they are all sold out. you can thank corporate partners for that. i'll read this tweet.

touchdown. m&g and its brands tide nfl, covergirl, bounty gillette push game to sellout. game will be on local tv, whodey. thanks to the green bay based associate bank the indianapolis colts have sold out their tickets against the kansas city chiefs thanks to supermarket chain meyer. the big talk was if they didn't sell out at least 85% of those stadiums, the games would not be appearing on local tv because of some antiquated rultzes by ftc. thanks to corporate sponsors but all of those will be able to be watched within the comfort of fans' homes. >> thanks kayla. >> i don't get why they -- how does the -- how do the packers not sell out a playoff game? i realize it's going to be minus

12. >> we spoke to a fan who's not going this weekend, talking about the weather, also implying it's the cost. they didn't know when they had to buy the tickets whether packers would be in the playoffs. if not, you might have a couple thousand dollars tied up until the ticket was good for next season. that's not true for some of the other teams. >> is that wouldn't have mattered once upon a time. i guess maybe it does now in today's economy. >> bank of america, merrill lynch raising price target on doing toll $1250. that stock trading now at about $1109 a share. it's a little lower today. >> can google in fact continue higher from here to that level? with us larry from dyna link and abigail doolittle. abigail, you don't think it's going to make 1250. you don't think it will make $1200. >> when i saw that number go across the screen before this segment, i was shocked. no question google is a great company. one we love and use several

times a day. when we separate the company from the stock, i think a different story emerges. we're looking at shares priced to perfection. they're trieding 31 times next year's earnings 32 times priced to sell and 30 times free cash flow. it is a rich stock. this is important because when we look back at the company's history of reporting, it's lumpy. 2013 case in point, q3 was a good quarter. q2 not so much. the stock dropped. when you have a company that's putting up imperfect quarters with price to perfection, it could be a problem. this stock is ahead of itself. up 25% over the last little more than two months. 60% last year. up more than 350% since the 2008 low. that's relative to the comp the nasdaq composite, up 230%. this stock needs to breathe. i think it will breathe below $1,000 at some point in 2014. >> larry, why do you like it here? >> i don't think it goes back down. i think this thing continues to drive.

they're at the forefront of the tech ecosystem with the search engine they have with the advertising model. have. the reason they catapulted -- >> you named two things that defined google in 2004. >> but still you got to look at the revenue they have the profitability they have and what they continue to have. r & d, coming out with google glass. >> which everyone has panned. >> this is head of the tech model. if you're talking about 2004 look at the revenue then and now. the reason it continues to drive is everyone was concerned about the cost per click going down. the cost per click went down last quarter and the revenue and profitability went up. so they're at the forefront of the tech ecosystem and e-commerce. 60% of the world's e-commerce. you look at e-commerce ecosystem of advertising, they're rightal it. it's a well-oiled machine perfectly hedged. >> as long as we're in a devil's advocate mood abigail, you know

the bet against google has been fraught with danger. it's like betting against the fed. >> i don't disagree with you. this stock has been pretty amazing because despite the fact it has been trading up it's been trading up in a bearish manner because there's profit taking during the up-trend. not everybody is on board -- >> what does -- trading up in a bearish manner, if it goes up who cares? >> you have to look at the instant -- >> at some point -- >> you have to look at institutional investors here. fidelity contra fund went in 50% of the fund. fidelity is the largest owner. it's going up now because of the mutual funds. >> go ahead, abigail. >> my area of expertise, my lens on the financial markets is technical analysis. when i look at charts of this stock, it is going up. the up-trend is starting to reverse itself over the medium turn. it tells us there are sellers waiting to pounce to. if this quarter doesn't put up a perfect quarter i think you could see it sell off.

i think that all of the momentum stocks, in fact in 2013 could really be a tough trade in 2014. and google is right in that pack. >> aren't we at a point, larry, where google will start to be viewed -- you know the law of big numbers, the way that we view microsoft today, it's a mature technology company. >> but the thing is bill they're really not mature because tech ecosystem, we're at the beginning of it. you have to look at all the other things that will come out with smart tvs, with gadgets, google glass. they're ahead of the game. the tech companies still talking about old things -- >> are you going to buy google glass? >> google glass -- i will buy google glass. i've heard great things about it. we're all wonder being it but i think this is something that's going to be big. the whole thing is, they're a well oiled machine. that's why i like microsoft as well. >> is he we have to go.

happy new year. have a good weekend. >> are you going to buy google glass? >> i looked at it because it's an invite-only basis. doesn't seem worth it. >> market's going higher. up 70 points as we get ready for ben bernanke. >> that's right. the fed chairman about to take questions on the fed economy. what many call his farewell experience. will they ask him about charles said about interest rates. could be market-moving news. >> that's the speaker just before the q&a, by the way. here's something that might make you feel a little sick. a new study finds obamacare's costs could skyrocket because newly insured americans may actually use emergency rooms more. not less than expected. is this another budget buster for the new law? a top white house official will be reacting to all of that coming up later on the "closing bell." stay tuned. ate. that's correct. cause i'm really nervous about getting trapped. why's that? uh, mark?

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we are just moments away from chairman ben bernanke's question and answer session. this is the final speaker at the american economic association there in philadelphia before they get to the q&a. by the way, just the anticipation has apparently moved the markets higher here as art cashin told us just the anticipation that maybe bernanke throws a bouquet to the market,

as he put it that could move the markets. we're keeping an eye on dow, up 65 points as we get ready for the q&a session in a few minutes. >> a lot of news coming out of the auto and air industry. who better to turn to right now than our own phil lebeau. first, phil we got to ask you about auto sales. then of course the big boeing union vote coming up tonight. there seems to be no other way to describe these numbers than a big disappointment. >> a big disappointment when you look just at the month of december. keep in mind, we had such a huge thanksgiving weekend and such strong numbers in november that most people were expecting some type of a payback. a little bit on the disappointing side when you look at the number of sales, vehicles sold last month. and when you look at the whole year, though, 15.6 million were sold. think back to four years ago kelly, total sales for the year of 2009 10.5 million. this industry's come a long way in just four years.

>> they're going to sell cars in cuba again. what about the classic cars -- guys coveting the cars they've been driving in cuba for the last 50 years, right? >> you know somebody wants to get their hands on some of those used vehicles. listen, they're not going to see huge sales down there. a number of people in the auto industry have said all along listen if that economy ever gets reformed f they ever truly open up and welcome in capitalism on a true scale there could be some real potential for sales down there. but what we're seeing here is we're going to see minor, minor sales. they showed a dealership down there and there were some people there but i don't expect big sales. >> if i read this right, average income in 20 bucks a month. puget costs 90 grand and total infrastructure would have to be not out to sell vehicles in cube back would it not? >> yeah. some people are looking at this and saying, this is a quaint

story but nothing automakers are focused on. they need to see a complete change on the economy down there and the way that sales are encouraged with the people in order for them to think, okay maybe we can do something down here. >> by the way f you're just joining us. we're waiting for chairman bernanke's question and answer association. this is the speaker scheduled prior to the q&a. that's why we're keeping an eye on it. we don't want to miss anything when bernanke gets back to the podium. phil, talk to us about this union vote tonight, how important it is, obviously, for boeing right now. >> it's huge. 31,000 members of the machinist union will be voting on a second contract offer from boeing. remember, last month they rejected boeing's offer that would have basically, in exchanges for them making some concessions when it comes to pensions, medical benefits and really locking in some wages for eight years, that a lot of people are sitting there saying i'm not sure i like this wage scale.

in exchange for that boeing was saying we guarantee we'll build the xxx in the seattle area. once it was voted down the first time, boeing said, let's look around the country. lots of other potential sites for building this plane. we'll bring thousands of jobs to other areas. >> they're acting like the olympics committee here. they're letting 22 states bid for this project. meantime knowing seattle's -- or washington is desperate not to lose it. >> meanwhile, boeing shares have doubled in the last year. they're sitting near all-time high around $137 right now. >> they are. this brings up the question, people would say, why would the machinists vote this down? don't they want the job security? they look at this and they say, a, we've got the only skills that people who build these planes have. can you go somewhere else in this country, but you won't be able to do it with the proficientcy you can in the seattle area. they also believe boeing will ultimately come back again with another contract offer. but boeing is saying this is their best and final offer. it will be interesting to see when votes are tallied up

tonight whether or not this gets shot down a second time. >> also interesting because there are intergenerational divides this has exposed within the union. the older folks, average age of the people in the seattle area in this union is 49 years old. they know they're going to get their full pension at 58 so they don't want to go necessarily to a system where they go from pensions to defy contribution like a 401(k) style plan. in the meantime this is a direct quote from one of the younger members of that union who apparently, one of their last meetings, talking about this said retire and go away, to the older folks. get out of our way. let us move forward. >> teamwork. >> this reminds me of what we saw with the uaw for years in detroit. they said, no way, no way, no way, no way, we're never going to change. it took gm and chrysler going into bankruptcy and a lot of people staring over the edge and the federal government getting involved for them to say, okay we'll change how things are operating here. there's nothing that is forcing that to happen right now out in the seattle area. >> thanks, phil. see you later. have a good weekend.

let's bring bob pisani in. we're losing altitude. we were up 70 points moments ago, now up 43 as we get ready for ben bernanke's q&a. >> fed officials are actually moving the market including the ben bernanke. let's put up the dow jones industrial average. the important thing is charles mroser came out earlier, dropped about 50 points earlier in the day. gave a speech where he noted the fed must be prepared for a rapid tightening campaign if needed. markets moved down on that pplosser is a hawk but a voting member of the fed voting committee. let's talk about what's going on here. we've had a santa claus rally. a tendency for the last five trading days of the year and first two of the new year that's today, are up. if we end right here s&p will be up 0.5% in that trading period. historically we have moved up 1.5%, so we are seeing a gain

but it is a little less than expected. the next little january barometer -- there are several that are around here -- is the first five-daye day warning here. that says when we've had a market up in the first five trading days of the year, we've logged gains in the full year, 84% of the time. guys, back to you. >> it looks like they're running a rather irreverent video to ben bernanke to the tune of "rudolph the red-nosed reindeer ". ♪ and they shouted out with glee ♪ ♪ ben bernanke the central banker ♪ ♪ you'll go down in history ♪ ♪ you'll go down in history ♪ >> wow. there we go. >> any time you put a picture of ron paul on the video introduced ben bernanke you know there's some irreverence going on there. he's a good sport for that. always has been.

he has a rather bemused smile. let's listen in, see what questions he gets. >> for people to say, i can't believe the kind of lack of gratitude the politicians have often shown for what they did in the crisis. i think we were very close to great depression 2.0. if it hadn't been for his leadership things could have been very, very different. it's unfortunate, i think economists recognize this i'm sure history will treat you really really well. it's too bad that it hasn't been more fun as it was going on. we can't even give you a gift because of the giving limits. but after your out, i'll offer you some cubs tickets.

>> this is at the american economic association. >> when you organize a session, your nightmare, some fellow who thinks it's a comic, going to produce something. so for the last week we've been talking about well is it really a good idea? you know if it goes over well you'll be famous but if it goes over badly, you're going to be -- you'll be the butt of jokes on "saturday night live." well, i thought it went really well. so we have time for questions. so, there are two mikes over there. we don't have a lot of time, but the chairman very graciously offered to follow up and allow you to follow up with questions.

the ground rules are the standard ground rules, which are questions and no speechifying. when it crosses the line i will intervene. so, let's start over there. >> thanks for your speech, chairman bernanke. formerly from ohio state. in 2008 the fed acted aggressively to protect money market mutual fund investors from small negative returns. yet equity mutual fund investors took negative returns almost every other day. in fact they lost about 50% between the crisis and early 2009. so, if investment should all be profits and no losses as in the case of the money market mutual funds, shouldn't the fed have acted equally aggressively to buy up stocks or was it a big mistake too support the money market mutual funds? the first thing could be in ken rogoff's chapter --

>> any questions that might come up, partially about production values. the actions to -- which, by the way, were led by the treasury department to protect the money market funds were not about protecting investment of any particular individual or group. it was about avoiding precisely this issue of one of the key ideas in a financial crisis is what's called a fire sale. the idea when large numbers of people are forced to sell assets at a given moment, it will drive down prices well below the sustainable price level because not enough liquidity, not enough buyers in the very short run. that will feedback -- reduce the net wealth of other asset holders who in turn will be forced to sell and you get into a vicious cycle. the money market funds that were in a run were pulling cash out of first, repo market which

finances a lot of assets held by broker/dealers and others and the commercial pay for market which funds both financial and nonfinancial in the short ternl. it wasn't an issue at all of protecting the wealth of any given group in the same sense that intervening with various companies was not an attempt to protect the wealth at any given group. it was rather an attempt to try to avoid a cascade of falling asset values and fire sales, which the run on the money market funds was already creating. >> but the equity funds had to sell assets too. in fact, indeed it cascaded 50%. >> but they weren't runable. that's the point. -- >> neither are money market mutual funds as long as they act like mutual funds. >> the -- >> if you get 2% more if you put your money in. >> next question. >> my question is on mechanism. do you think -- >> can't hear you. is that on?

try anyway. >> my question is the mechanism by which quantitative easing is set to work. your original statements back in what is called qe1, suggested that what you were doing was targeting higher inflation and that -- or avoiding deflation. and the impression that that generated is that higher inflation would generate a real fed fund rate and generate more stimulus. but your more recent statements suggest quantitative easing works through reducing interest rates, buying securities which reduce interest rates. which is the more important mechanism that you're attempting to use here rising inflation or lowering interest rates? >> no. i think you're mentioning together goals and mechanism. the goal was to avoid deflation.

so one of our concerns, besides the weak recovery, at the time of qe2, was that inflation, as today, but even more so, was very soft and moving down. we were concerned about deflation risks. of course, deflation is not a zero one thing. even low inflation can create problems. so we adopted the quantitative easing policy with the objective of raising the inflation rate to meet our target. and at the same time by doing so of course we would lower real interest rates and help the real economy. so that was the objective. the mechanism, and of course there's a lot of debate about how exactly this works and so on but the mechanism we have focused on is based on sort of a tobin -- friedman kind of world in which there are perfect world so buying up assets has an

effect on the assets. that's the mechanism i discussed today, which i talked about in jackson hole right before qe2 as well. that's the basic mechanism that we have argued. >> thank you. world bank group. just wanted to ask if you could share with us a little more on sort of how you balance transparency and accountability of a central bank independence and what challenges other central bankers might face in trying to follow your example. >> why is it a question of balancing? so -- well okay. let me -- let me try a specific example. i think i understand where you're coming from here. so the very specific example, and i have a long footnote in my speech, which if you'd like to take a look at, it it's on the fed website, talked about so-called audit to fed legislation.

that legislation is misnamed. it's not about auditing in any common sense at all. as i tried to emphasize in -- in my spoken remarks, the fed is thoroughly audited. all of its financial operations and financial transactions are thoroughly audited kroels and everything. as i've said, we've had a very good record there. moreover, the gao, the general government accountability office, which is an arm of the congress, has access to virtually everything that the fed does and can comment, criticize, report, et cetera. the one exception, and here's i think what you're talking about, the one exception is that there is an exemption in the law for gao auditing individual monetary policy decisions. so, the gao under current law is not allowed to come in and say, give me the records of your last

fmoc meeting. we to want have an independent review of whether or not you should have raised or lowered interest rates at the last meeting. and so that -- that exemption in the gao law, which was put in in the '70s by the congress, we view that as an appropriate balance, on the one hand the fed is very transparent, very open. gao has broad access to all of our activities. of course monetary policy is very transparent. we put out minutes, et cetera, et cetera. but the congress took the view in the '70s that exempting monetary policy decisions was needed in order to prevent congress from using gao audits as a tool for influencing short-term decisions made by the fed. so, there's a balance there, as you point out between independence and transparency. what the so-called audit the fed legislation in various forms would do is remove that

exemption. that's only thing it would do basically. doesn't do anything else. and removing that exemption, again, would mean the gao could come in, the day after an fmoc meeting and second guess the fmoc's decision which would be inconsistent with any view of central bank independence. i think the balance where it is now is appropriate. i think i would resist giving congress day-after authority to second-guess our policy decisions. and i think it would be bad for the economy if -- if the public and market makers, market participants, thought that essentially whatever the fed did was subject to immediate reversal or substantial pressure by the congress. >> we have a question from a student. i asked my students if they had a question for the chairman. and there were a number of them. one, which i won't ask is what about bitcoin.

which i know he knows about. but i thought a really interesting one was this if you knew in 2006 what you know now, what step or steps would you have taken then to prevent ora aameliorate the financial crisis and subsequent downturn. >> that's a really unfair question. i mean, the reality is that everybody -- every policymaker has to, you know -- this is the nature of policy. it has to be made in very, very foggy conditions, with very imperfect information. a lot of uncertainty. so, in order to do anything, i think i would not only have to know everything in advance, everybody would are to know i knew everything in advance. in other words,fy went out and started saying all of a sudden

i'm ashrbitrarily raising capital rates by 5%, they would say, what? it would be very difficult to get congress and regulators to agree. i think the crisis was very complex, involved many, many issues. one of the concerns you know, i want to respond a little indirectly to -- because of a point that was raised is the use of macro prudential type measures. i think one of the practical questions if you think you have measures that work can you put them in place quickly enough and responsively enough preemptively enough. i think that's one of the things. 9 bank of england is working at trying to find mechanisms for more rapid response so to speak. i think that's one of the real challenges. for example, before the crisis the fed put in new guidance on commercial real estate for banks

banks, which strengthened the criteria for risk management and said that you shouldn't have too much cre on your balance sheet, et cetera, et cetera. that process went through -- it took more than two years of negotiations and discussions and sending that to the banks and the banks have time to implement. it's -- in order to make this word the macro prudential things to work we have to have a more nimble system. i think that's a big part of this. the answer to the question that bill raised is that i'm sure where there are some things that could have been done but unless everyone collectively knew what was going to happen and was willing to work together cooperatively to take those necessary steps, it's not obvious that you could have avoided it. >> give you one more question. >> larry sideman, unit of delaware. you rightly express concern about the premature phase out of fiscal stimulus at the end of 2010. do you think in a future

recession it might be helpful if the federal reserve were able and willing to give the cash transfer to the treasury so congress could sustain fiscal stimulus further without additional borrowing? >> i don't think i'm going to go there, no. no. see, that -- first of all, that's not going to work because presumably the fed has an inflation target, right? so even if and let me emphasize to everybody, this is entirely hypothetical, even if that were to happen and i think it's no doubt illegal anyway but even if it were to happen at some point in the future the fed would have to undo that in order to get the money supply consistent with its inflation target. therefore, it actually would not affect the long-run debt held by the government. so, i'm not at all sure that that's -- that would even work

in theory. so it certainly sounds to me like a bad idea in any case. i think fiscal policy ought to be made obviously by the congress. and thinking comprehensively about spending attacks and debt issuance. thank you all very much. >> and that's federal reserve chairman ben bernanke just wrapping up the question and answer period in philadelphia at the american economic association meeting. it could be one of his last appearances adds fed chairman. steve liesman is there with all of the highlights. steve, you know markets really lost some ground here as he began speaking. i should say, anyway steve will be joining us as soon as he gets miked up. straight to the panel with thoughts/reaction here about this. everything else that's been happening in the markets today. we'll add other voices as soon as we get them. on our panel, dominic chu, robert frank and dennis

gartman. brian kelly, "fast money" extraordinaire is here as well 37 dom, one of the first things that happened is auto sales are quite disappointing. do you think that had to do with the selloff -- or i should say, pull back from almost 70 80 points on the dow or more with what's happening with the fed today? >> i think it's key what you said. this wasn't like a sell off. we're talking about a market with a decent selloff with the s&p down about, we'll call it almost a percent yesterday. what you have today is a -- is consolidation, if you will this kind of tug of war going on. people want to figure out whether or not they want to jump into this market, whether or not this was a dip or not to buy. that's the real issue. those auto sales, yes, they were disappointing and, yes, they do paint perhaps a slightly bleaker picture about spending in america but it dentidn't weigh heavy on the markets. >> what was it about -- we started the year off on a pretty weak note. >> it's going to be a down week.

i'm calling this the hughie lewis market it needs a new drug. the federal reserve is going to continue its stimulus but not as much as last year. the pmi data out of china, not so great. auto sales, not so great. it needs a new stimulus. it needs something to ratchet up the excuse, why am i going to buy this year. >> it was supposed to be its own stimulus to some extent. some are talking about how gears are finally clicking -- >> the positive stuff, i think is already priced in. we had a killer year last year. just amazing. i think you need some other drug to get you going into 2014. it's just not there yet. >> morgan, what's the drug? >> the drug is economic growth. well pot -- we can always look at that. i think the drug is economic growth. i think what federal chairman bernanke had to say was mixed. we saw stocks jumping around in response to the comments he was making and in response to his speech. yes, i think he's still putting out there there's still a security blanket to be had until that economic growth really

takes off. you're talking about pmi data out of china. we also saw better than expected data yesterday here stateside. >> dennis, art cashin walked by here. we had been talking about stocks before bernanke started speaking in that q&a portion. as he did, they gave back some gains. he was joking it was as if bernanke handed investors a bouquet of dandelions. >> first of all, when art cashin says something you need to pay attention to it. i think the fed chairman went out on a decent note. i love that line earlier, this is a market that needs a new drug huey lewis market. what a great line. we did have a market that was down very hard yesterday. i was somewhat surprised by how hard it was down. the fact you were up 70 80 early this morning. a normal bounce from that break yesterday. we shouldn't be surprised we came off 25 or 30 points. i would not give it -- i would not be -- put too much significance into the fact it

came off during bernanke's talk. >> brian kelly, standing by. want to bring in steve liesman, who was inside that speech. we had everything from a rudolph the red-nosed reindeer rendition and a bernanke who seemed more chatty jovial mood than we're used to seeing him. >> you can feel like he's got a foot out the door. still watching his words. you can see how he declined to answer that last question if the fed funded treasury stimulus. for my money, the most important thing bernanke said today was discussion about the foreign economies. he said a bunch of what he said previously about the u.s. economy. about feeling upbeat about the headwinds abating. when he talked about foreign economies, that was new. >> what in particular was he saying? >> well his notion that you might finally be in a situation -- we talked about this a week or so ago -- where both japan, u.s. and europe are having strong growth. that would be new for this

post-recovery -- or post-financial crisis period. and that i think, it raises questions. it changes the investment outlook. you could imagine -- >> in other words, it makes the fed give more confidence about pulling back, perhaps. >> well exactly. that's what i was going to say. you can imagine that would accelerate, for example, if you had, indeed strong growth and perhaps inflationary pressures on the commodity side that came from strong global growth that maybe you would have an accelerated tapering by the federal reserve. but it's also important to mention that the chairman went out of his way today to say, you know what just because we tapered, what was it a week or so ago, that doesn't mean we're going to be changing our outlook on monetary policy. it's an interesting comment, neil said how can you make these predictions about the future when you turn over three or four members every few years? and bernanke did not respond. >> it should be less particular about news a member would have

and more about the general evolution of the outlook, steve, wouldn't it? >> also institutional. that would be the response bernanke would give. it's not individual stances on monetary policy. it's an institution that's making essentially a pledge for two years down the road. the idea that bernanke is leaving, kelly, doesn't mean the debate ends. in fact, in many ways it begins. i think bernanke giving an upbeat comment on the economy, both domestically and abroad is significant, reiterating his promise or pledge by the fed to remain low on interest rates is also significant. he also decided to spend a little time saying, you know what, when it comes time, we have the tools to remove the excess liquiddy ty from the market. that's another thing we have to start watching for, if indeed we get there. >> brian kel y it's interesting because we saw comments from plosser indicating the fed would have to act more aggressive. interesting coming from someone traditionally more hawkish.

is that why the market was struggling toward the end of the day? >> there's a lot of moving points, cross-currents today, so it's hard to point to one thing. but the comments are interesting, particularly when you see the banks doing so well everyone is talking about a steep yield curve. if the banks take some money out of excess reserves and actually start lending that out, then you get the money velocity. then you get the potential for higher inflation. which then leads to the fed ratcheting back more quickly. >> brian do you think that's -- is that what traders are speculating about right now? is that what you're hearing? are people walking through this, saying, if this all starts to work that's the next worry point? >> i think on the longer term picture, yeah. you're talking six months down the road, that's what traders are talking about. today what traders are talking about -- >> but, kelly -- >> yeah, go ahead, steve. >> there's about a nano second between the time that the markets worry about the fed making a mistake on not being accommodative enough and then being too accommodating.

you pass through that point in about a nanosecond. i don't know if we're there yet. it's hard to know why the market reacts the way it reacts. clearly, what's the thing you'll worry about next? if the economy is doing okay then -- >> suddenly they're behind the curve. fair point. >> right. >> it's all about the speed. >> a perfect fed -- the idea of a perfect fed is not something that becomes an investment thesis. >> traders worry about the speed of a rate rise. that's what everybody cares about. you get a real fast increase in rates, that's going to be a problem. it's slow and gradual. the economy is doing great. everybody's happy. >> i will say this though again, emphasis for traders all out there, taper does not equal tighten. again, it's going to be a long time before you work down from an $85 billion to $75 billion a month to zero then to maybe raise short-term rates. you still have a ways to go. >> 2014 will be interesting. we got to go -- yeah, brian? i was going to let you try to

sneak it in. it was dennis. it's confusing. there are a lot of boxes up here. steve, thank you so much for joining us. it was very interesting to hear -- >> kelly how can you not be here kelly? >> i know. i'm supposed to be leaving after the show. i'm not going to make it. so devastated. say hi to everyone for me. have a good one. thanks, everybody. catch brian kelly coming up on "fast money" at 5 p.m. coming up, ben bernanke is done talking and the market has moved on to someone else from the fed. monday it looks like the senate will vote on janet yellen to be the next fed chair. how much are your investments dependent on what she does or doesn't do in 2014? a new study showing good lucks generate better returns for ceos than less attractive counterparts. really? our panel will weigh in on if that study is particularly credible. we want to know what you think. tweet us @cnbc.com closingbell. [ shirley ] edward jones. this is shirley speaking. how may i help you? oh hey, neill, how are you?

how was the trip? [ male announcer ] with nearly 7 million investors... [ shirley ] he's right here. hold on one sec. [ male announcer ] ...you'd expect us to have a highly skilled call center. kevin, neill holley's on line one. ok, great. [ male announcer ] and we do. it's how edward jones makes sense of investing. ♪ ♪

welcome back. trading activity was far from brisk because of the snowstorm. when charles plosser warned the fed may be aggressive on raising rates and could happen sooner than most think, we saw a reaction immediately. we have a great group, and more

reaction to fed chair ben bernanke's responses. larry mcdonald sr., director at new age, and greg ip u.s. economics editor at "economist," all cnbc contributors. greg, kick things off. this is plosser, typically hawkish. did his remarks surprise you? >> not necessarily. he would like to raise interest rates faster than most of his colleagues. this raises a particular issue for the markets this year. plosser will be a voting member of the fmoc on so will richard fisher, both hawkish and dissented for more hawkish policy. one of janet yellen's first task is fashion consensus among hawkish new names that doesn't constantly produce mixed messages and per verse reactions in the marketplace. >> if you read between the

lines, what the worry is from this community is that some of the more voices will be voting this year could take the fed in a different direction. one, perhaps, they wouldn't like to see it go. >> i think you also have to remember that another person rotating onto the feed is eric rosenbaum, boston president, a notable dove. i think that's a key point. the mix is going to change oefrt years. it's more incumbent on whoever is leading the fed to ensure they can reach consensus. there's not one representative fmoc member something professor cashup just said but there's a way to forge a path forward. >> what is a trader to do amid all this? >> we've been here before kelly. we've been at 3%. we've been at periods since 2010. i meangeithner was talking

about escape velocity in 2010. i would like to hear greg's point on this. janet yellen is a labor market economist. i have to stress that. robert rice is a labor market economist. she's left of keynesians. she's looking at this inflation number of 1.1%. i think there's a chance yellen in the new year and this would be a bombshell, could come out with a targeted floor on inflation. in other words the fed would defend -- >> let me jump in. if what markets were -- if you're right, what you're saying is she might be more dovish. she might be looking at more to stimulate the economy, why then are stocks selling off and the treasury, the ten-year treasury at 3%? in other words, it seems like that's not the direction the market is moving. >> i think the market has been pricing that in. if you had big gainers toward the end of the year you'll sell

them in january and pay your taxes in 2015. >> greg what do you think? >> i think that -- i had actually. expected a month or so ago the fed wouldn't introduce a lower target on inflation. saying if it goes below 1.5% -- >> a lower bound? >> yeah. exactly. what they did was gave us qualitative language saying, we're not going to raise rates. if inflation isn't projected to be well below target. i think that more or less takes care of the point that larry was saying. who knows, she may surprise us. honestly i think investors need to pay less attention to the personality and more on the data. memorable lines from bernanke's speech today, he said if experience tells us anything it's about to cautious in our optimistic forecast. how many times have we sat on these panels in january talking about, great looking to the year and didn't come to pass. >> what's ironic greg it's precisely because of that in the past the sense that every time we were thinking you know

we're there or we weren't, elon people say, what if we are? what if the economy really is there? now, in fact, the fed is behind the curve? >> i think that's why the fed has opted to take it slow and start off with a tiny taper of just $10 billion. we'll see what happens at this fmoc meeting f they decide to continue that program or if they decide to wait a few meetings, see how it goes. but this sort of small, cautious, testing the water decision the fed has made is i think, exactly why. they have been wrong before. they want to make sure they have an escape hatch if the bottom falls out. >> still flexibility. got to leave it there. thank you for being here. greg elon larry have a great weekend. >> thank you. >> what happens in new york city real estate, meanwhile, may not necessarily stay there. coming up next rich foreign buyers are having a huge effect on the luxury market. and not all high-end real estate is benefiting from the cash hoards. robert frank will give us the tale of two markets. there are no branches? 24/7.

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outperform. general motors, not beginning the new year on solid footing. it said december sales fell 6% bucking a trend from earlier in the year. the problem was top selling pickup trucks came under pressure from discounts by competitors. the company also blaming bad weather in the midwest. it was also a tough week for utilities, especially con edison. down 3%. the prospect of rising interest rates hard on these stocks because dividend utilities. these companies borrow a lot to fund their operations so that becomes more expensive for them too. on the plus side twitter starting 2014 with a bang. up nearly 10%. a true momentum stock. fell 14% at the end of december on news of just one downgrade. also a good week for hertz, up nearly 11%. a lot of questions swirling about activists throughout the early part of the week after the company on monday adopted a poison pill to prevent a

takeover. but today cnbc's david faber solved all that for us when he reported it was actually carl icahn who bought between 30 to 40 million of the company shares. few moves this week like fireeye, cyber security company acquired a privately held company mandian, cyber security firm for $1 billion in cash and stock and announced fourth quarter and fiscal 2014 refer new topping estimates. that stock up 33% in just one week. back to you. >> and they're paying for the deal 90% in stock, too. thanks very much. have a great weekend. now from stocks to real estate, there's a tale of two luxury markets here in new york city these days. it could have wider implications. robert frank, explain to us what's going on. >> report today with blockbuster numbers that show all kinds of records being broken in manhattan real estate. the average price for an apartment in manhattan is now $1.5 million. that's an all-time record for fourth quarter. inventory now at the lowest levels in recorded history.

they're just running out of luxury apartments in new york city. only about three months supply. now, what's interesting is that only some kinds of apartments are really selling big. it turns out those luxury sky rise towers that are brand new and condos those are up 13% in price. but those old co-openssco-ops, those fell in price. what this tells us is that the foreign buyers are really driving the high-end of real estate manhattan. we kind of knew that but this really tells us how much that's happening. the co-ops they can't get in the co-ops. wealthy foreigners they're not getting approved. they don't want people looking at their finances. they're from russia or china and they want to keep it private. so really it's a condo-only market for the foreigners. that's the side that's just really taken off. >> here's my question robert is this just a phenomenon of new york city' market? for other markets which don't

have a lot of co-ops they don't -- is there something we should learn from the way co-ops -- >> absolutely. co-ops are a bizarre new york city creations. they don't really exist anywhere else. and i think during the downturn all the co-op boards said, isn't this great, we didn't decline as much because all our members are rich. now it turns out, you'll be left behind when it comes time to sell your apartment. now, will they change into condos? what's happening is that most of the new construction, almost all of it, is condos. it's literally where old money is going to die in these co-ops. >> as a former trader i would say this rings with me only because one thing i pay the most attention to is liquidity. the idea you can actually get in and out of something. like when you have a co-op board, it makes it that much harder to transact. get a trade done. i would be more weary. >> you're talking about co-ops high-end co-ops talking about

10% cash down. they haven't taken off the way condos have taken off, but they also didn't get hit quite -- >> that's right. another point to be made, too. i can't help myself. >> we have a real estate -- >> you have a real real estate reporter here. >> one of the other points is that we're starting to sigh old school american co-op owners move their money downtown as well. domestic buyers are following foreign buyers in this trend toward condos. i think that's propelling it. >> here's what i'm curious about. if you were to say -- this is the argument like a hedge fund will say, we don't do as well in hot markets -- >> we outperform in down markets. >> exactly. they say that's why you should stick with us because over the long run, you're better off. >> the problem is, the difference now -- that was fine until this year. really maybe even this quarter. difference -- mean con dose were up 13%. if you owned a condo, you're up

13% in one quarter. if you own a co-op, down 2%. how much does that aceo crew over time if we have a downturn i still haven't made up my money. it's all about liquidity, you're ability to trade in and out. the same with the art market any asset. >> can you imagine what these con condos are worth in yen terms? >> how about yuans. >> i hazard a guess there aren't many japanese. this is russian money, chinese, malaysian money. not japanese money. >> the structure is making -- causes a big difference. you know i guess it becomes a question of short term versus long. is that -- >> well there's that and there's also an issue of just what rich people want today. they love the new floor to ceiling windows where you can look over all of manhattan and say, it is all mine. you're on the 50th floor. you've got all new amenities,

the concierge downstairs. >> is that you're next book what rich people want? >> i would read it. i would definitely read it. >> here's interesting numbers. we've seen this -- robert is right to be talking about this. we've seen it move in this direction for last couple 6 years. in 2012 we saw the largest purchase of a condo, about $1350 per square foot. >> per square foot. >> dollars? >> that's insane. >> the largest price we saw a co-op fetch that year comparable penthouse in central park area was $450. huge difference. >> not a single one of the top five transactions last year were co-op. they're all town houses or condos. >> in markets they swing like pendulums, you never know when it would go back the other direction. >> you could get a good mobile home for $13,500. >> you can get a single wide. >> exactly.

>> sfind afind a place to park it in manhattan. that's the problem. >> kelly, you're from virginia. i'm from virginia. $13,50 per square foot can you buyer a nice house, on the golf course for about $200 a square foot and buy yourself a nice airplane to go to new york for the weekends. >> exactly. >> maybe even in virginia beach. >> that sounds like a good game plan. coming up unintended consequences. why obamacare my drive more to visit the emergency room as opposed to less often. that was supposed to be one advantage of the law and it could drive up costs for everyone. a top obama administration on the rollout takes the hot seat on that. aflac! aflac! got 'em. ♪ ♪ yeah he's clean, boss. now listen to me, duck. i have an associate that met with, uh an unfortunate accident. while he's been incapacitated somebody's been paying him cash. now is this your doing? aflac? now, if i met with some such accident would aflac pay me? ♪ ♪ nice. this is your

stop. [ male announcer ] find out what aflac can do for you and your family... aflac? [ male announcer ] ...at aflac.com. ♪ ♪ [ male announcer ] this is the story of the little room over the pizza place at 315 chestnut street. the modest first floor bedroom in tallinn, estonia and the dusty basement at 1406 35th street. it is the story of the old dining room table at 25th and hoffman avenue. the southbound bus barreling down i-95. ...and the second floor above the strip mall at roble and el camino. ♪ this magic moment ♪ it is the story of where every great idea begins. ♪ so different and so new ♪ where those with endless vision and an equal amount of audaciousness believed they had the power to do more. time and time again. ♪ and then, it happened ♪ at dell, we're honored to be part of some of the world's great stories. stories that began much the same way ours did. in a little dorm room -- # 2713. ♪ this magic moment

♪ ♪ ♪ welcome back. obamacare sign-ups total 2 million, short of the 3.3 million administration hoped to have hitting those numbers key to keeping down costs for insurance. also key a theory people who have insurance are less likely to go to the emergency room. but a new study out of oregon suggesting the opposite might be true. what does that do to the cost? joining us now from the white house is phil white house adviser for health policy and reform. thank you for being here. >> it's a pleasure kelly. thank you for having me.

>> you know this story's leading all of the major newspapers. lots of people on both sides of the aisle saying it's hard to quibble with the evidence that effectively people in a lottery who wound up with medicaid a taxpayer funded program, went to the emergency room 40% more often than those who did not. what do you say to that in response? >> well, it's one study. it's one study that came out before the affordable care act was in effect. there are other studies that contradict it. certainly, i think the experience in massachusetts contradicts it. i think the key part of that study is that it may be very close to when the transition happened. i think the belief of some experts is the longer people have health care the less likely they are to go to emergency rooms. >>, so the study, i believe, took place in 2008 when frankly, i mean even today as the law's being implemented, a lot of people are struggling to understand it. then it was just a glimmer frankly. i'm not sure why that would have had much impact on whether people made it a choice day to day about whether to show up at the emergency room. >> it had nothing to do with the

affordable care act, is what i'm saying. that was one study for one population. as you know massachusetts has had a program in place for many years now. and their experience is different from the oregon experience. we're trying to get later information, the most up to date information, from oregon, to find out if those numbers stay current or whether later numbers change that situation. >> so let me put it this way. the president, when he was promoting the affordable care act said one of the things it would do is make emergency room visits less likely for the population who would now be insured under medicaid. that sounds like it may not be the case. what happens to the viability of the law if it's not? >> it doesn't have -- >> you still have that possibility. >> right. it doesn't have any effect on the viability of the law for the following reasons -- one, when the law was passed the congressional budget office said it would have $1 trillion in savings. that's fact. congressional budget office said that. second, when people don't have insurance, the place they can go is hospitals. they can go to emergencies because they'll get treatment

there. when people have treatment,insurance, that's likely to happen. the study in oregon shows that didn't happen but other studies contradict that. >> let me ask a hypothetical. if it turns out to be the case more people who have access to medicaid, a big part of the obamacare signups, a lot of states have expanded coverage and for now the federal government is carrying a big portion of that -- >> 100%. >> -- if it's true people are going to emergency rooms more often, does that mean this law will be more expensive than originally expected? >> i don't think so because people are going to the emergency room anyway. that was uncompensated care. that's an issue we'll look at going forward. as i say, this is very important, that is one study and there are other studies that contradict it. >> understood. it's an important issue. we hope there will be more work done on it. >> there will be. >> yesterday we had on the owner of a car dealership who stopped providing his employees with health care because the plan didn't mean obamacare standards and now he's cutting them a

check for $2400 apiece and sending them to the exchanges. i want you to listen to what he told us yesterday and get your fouts. >> four years ago my congressman was mark sauer. he supported this law. supported him. i don't think he knew the consequences of this law or i don't think he would have voted for it. >> what's your reaction to that sir? >> i don't know the particulars of his situation. my guess is he has fewer than 50 employees -- >> 40. >> he has 40. so, he's not obligated anything ush the law to do something. >> what he's saying is that he wouldn't have supported the law if he understood what the impact would be for these workers. >> well let's talk about what the impact of the law has been. for the past three years health care costs have come down. medicaid and medicare lowest growth in 50 years. that's the fact over the last three years. more than 2 million people have

enrolled on the program. on a key issue for cost and quality, hospital readmissions there are 130,000 fewer hospital readmissions over the last two years. that's a savings of $1 billion and that's savings to families all over the country who don't get -- >> a lot has to do -- it's only january 1 st. it's only yesterday, really the bulk of this law is going into effect. while it's great the last couple of years have shown promising signs and the growth of health care costs is slowing, much now depends on how much to the extent -- >> of course. >> in other words, what i'm saying is a lot depends now on -- >> kelly, kelly -- >> how many healthy people are enrolled in this program and this guy told us his young workers are taking the $2400 check and going home with it and not using it to buy insurance. >> we'll find out what the demographic mix is very soon. what we do know is we've gotten off to a griteat start with 2 million people enrolled. the other thing, law is just

going into effect and last week people were predicting problems for implementation this week. there hasn't been problems. i want to give credit to local pharmacies, cvs, rite-aid kroger, insurance companies have done a great job -- >> you could say the private sector is bending over backwards to make this work. that is definitely the case. >> i would say this the private sector is bending over backwards to bring affordable health care to millions of americans. and people always -- especially in the business community, talk about government and business having the same goals. this is a perfect example where government and business are moving in the same direction. and i applaud everything they're doing. >> we got to leave it there. thank you for joining us this afternoon. >> thanks, kelly. it's been a pleasure. >> appreciate it. after this despite what we just heard, republicans still think obamacare is going so badly, it can help them win next year. koch brothers with a $2 million

ad campaign. john harwood with that story when we come back.

welcome back. with some breaking news on sirius satellite radio. julia julia, what's happening? >> liberty media announced a proposal to make sirius/xm holdings a wholly owned subsidiary of liberty media.

there are already two different classes of liberty media stock. this would create a third class of stock. now, this exchange which is effectively acquiring sirius/xm as a part of liberty media, values sirius shares at $3.56. sirius shares are halted right now but last trade were $3.56 a share. it's a slight premium to that. kelly? >> julia, stick around if you will. i would like to get thoughts from our panel here. to go back to what you just said because it's interesting we're not seeing more of a reaction to the upside in sirius shares right now but it sounds like it has a lot to do with the valuation that liberty's potentially placing on them. >> yes. i mean, it's just a really tiny premium. $3.68 versus $3.56. i mean this really is just changing the ownership structure. in the release here jon meloan liberty chairman, says this will be an important step in the

growth of both companies. presumably -- >> shares are halted here. julia, i don't mean to jump in. we'll have to wait obviously, until they resume. it looks like they were up about 2% on the day, down fractionally after hours, just before this hit. >> yes. >> that's my understanding. >> so this deal just values the shares just slightly above where they last traded. so, it is not a massive premium. what he says here is that this will give new opportunities to optimize capital structure. malone is always looking for tax efficiencies. who knows what he'll be able to accomplish there as well. >> dom? >> the man's got a ph.d. john malone, in research and industrial engineering. he knows how to make and structure things. he's very good at this. i'm having flashbacks guys to the day of tracking stocks. remember those things where you used to have a stock that would track a specific unit within the company? that's what liberty media is doing. with this new class "c" share

they're saying sirius, we'll give you the bigger company, more access to financing and opportunities but give you the opportunity to participate in upside. >> dom, they were talking about sirius today on "street signs." you don't think this is liberty saying, you know what we feel now is the time to buy sirius that liberty is saying look auto sales for the year were so strong, i know from my experience, i bought a car, sirius was in it. i never would have thought of buying sirius/xm radio. now i have it. wouldn't live without it. is this inherent value? is this all -- >> no there's value. no doubt about that. but for right now, this is not a deal that gets outright huge premium. they're saying, can you take advantage of the upside. we'll give in essence, a tracking stock. >> the nature of this potential deal is also something that should not be overlooked. >> julia?

>> i want to note it's pending approval. and liberty media will host a web cast in 15 minutes to discuss this deal and its implications and what it means for shareholders of both companies. so, we'll get more information on that shortly. >> yeah, that's going to be fascinating. it comes just before the consumer electronics show in vegas. comes on the heels of stories about apple and google trying to get into your car. i was joking earlier this week about the sirius' ticker is siri because it sounds like potentially they have competitors coming after them. >> we have to remember pandora, free alternatives. sirius has that paid model but there's pandora, apple itunes radio, all these other alternatives that sirius is contending with. and then the issue of whether or not people who have it installed automatically in their cars maybe they get a year free, will they decide to up it? it's a fascinating time as you mentioned, right before ces.

>> all i know is this is john malone. don't bet against john malone when it comes to radio and communications. if you have you're probably a loser. >> what if you're a sirius shareholder, dennis? >> well you're probably somewhat dismayed by the fact they're only going to pay 16 cents premium. i wouldn't be surprised if it opens at a slight premium above that. i think most shareholders will be dismayed they didn't get $4. i don't think there's going to be anybody else coming out behind this to bid for it. that's probably the best you'll get. it it's going to be a long-term bet on synergies malone can bring to sirius. >> even if somebody else comes in here doesn't liberty essentially control the votes of this company? do they really have the last card here even if somebody does come in? >> julia, keep us abreast of what happens on that call. thank you for bringing us the news. we'll see what happens when sirius shares resume strading. a fascinating development this this hour. what stories are buzzing on our website? "the hot list" is up next.

we want to know if you think good looking ceos generate better returns? tweet us @cnbc/closingbell with your reaction. have you seen this video? a college mom taking on a hoard of college boys. who do you think won this brawl?

welcome back down here we're bracing for an arctic blast from canada this weekend. the web site hotter than ever alan, what's topping the hot list? >> i'm getting a blast of heat here taking a look at how customers are paying the price for the target breach. when we put it up we immediately got a spike alert on it. that sort of tells us hey, very hot story with readers right now. basically, she took a look you know for debit cards banks are on the hook for that. so what do they do? they start drawing back on what customers do with debit cards, all of a sudden people find they can't use debit cards to pay bills. kayla did a great job on that story. people are eating it up. at this point i looked it up. there is 1200 people a minute just looking at it. >> wow. >> big story. we also had another one doing

real good all day, all right, the imf came out with their paper, the big names in economic circles, and their paper said a lot of advanced economies, they are sort of underestimating the amount of debt they are building up overestimating the amount of growth they are likely to get. what will happen it will be bad things. they suggest policy initiatives. >> it's interesting to see them double down on the call as well. amid the u.s. in particular starting to outperform what they had suggested a couple years back. still below trend from prior experiences, but i digress. alan, thank you. >> take care kelly. >> have a good weekend. >> you, too. >> tons of tweets about good looking ceo's generating more returns. we'll share that with you next.

so i c an reach ally bank 24/7, but there are no branches? 24/7. i'm sorry, i'm just really reluctant to try new things. really? what's wrong with trying new things? look! mommy's new vacuum! (cat screech) you feel that in your muscles? i do... drink water. it's a long story. well, not having branches let's us give you great rates and service. i'd like that. a new way to bank. a better way to save. ally bank. your money needs an ally. [ male announcer ] this is the story of the dusty basement at 1406 35th street the old dining table at 25th and hoffman. ...and the little room above the strip mall off roble avenue. ♪ this magic moment ♪ it is the story of where every great idea begins. and of those who believed they had the power to do more. dell is honored to be part of some of the world's great stories. that began much the same way ours did.

in a little dorm room -- 2713. ♪ this magic moment ♪ ♪ ♪

welcome back. we've been asking if you think good looking ceo's yield greater returns. here are a few tweets that stood out to us. the three bs of business that investors need to consider brand, balance sheet and now beauty. absolutely, number one rule of advertising, first get their attention. and joseph tweets, it's always what's on the inside not the outside, and yes, this applies to the world's most prestigious

ceos. smiley face. before we go i could tell you wanted to say something. >> i was going to mention, beauty is all in the eye of the shareholder here. if you look at the top two billionaires who made most money, warren buffett and sheldon adelson, have you seen sheldon recently? the guy who lost the most last year ikee battista pretty good looking guy. >> i would have been less surprised if the findings were the opposite. >> opposite. exactly. >> that it was more that people get lulled into thinking oh -- kind of like the used car salesman thing. they seem to be effective. but it turns out -- >> they are frauds. all sizzle no steak. >> exactly. dom, what do you think? >> i just want to know what the subjective measure of how an attractive ceo is supposed to look. what exactly -- >> symmetry. >> i want to see the list guys of who made the most attractive ceo and who was not on the list. >> i am so happy up brought that up. i was chasing this down today.

i reached out to two economists at university of wisconsin that came out with this report they would not release the list the only person they put out there was yahoo's marissa meyer. they said she was top 5% of course we have seen that stock up in the last 12 months by about a little over 100%. >> is that because of the cosmo spread. >> the vogue. >> whatever it was. >> they were using their photographs and asking people whether they considered them attractive or not. >> so i'm not so sure how i feel about all of this who have seen a lot of research coming out of the psychology field. but they did look at 677 ceos, and they did it using specific scientific facial geometry so apparently this is more objective than subjective. >> is this an investment strategy you believe in? >> i'm not sure i would make investments upon it. but this is not new. we've seen reports come out over the years, that show that good looking people get the first job. good looking people get the first tee time. good looking people get the first seat at the restaurant. so this is not unusual.

i'm not surprised by seeing this. is it an investment opportunity? i don't think so. but i am not surprised by the data that came out at all. >> i will say by the way, i know dennis gartman's golf score, i know that's why he gets though tee times. don't try to hide it. >> come on the program, we want to talk to you about the study. anyway, before we go we want to show the most unbelievable video of the week in the stands of the sugar bowl in new orleans between alabama and oklahoma. one woman an alabama fan gets into it with a big group. l of young oklahoma fans. all of them male. the husband tries to pull her away, as you see there. but then well, it all literally starts up. >> this is a wide receiver move. >> look at that. she's in. she's over the goal line. >> i think you could do color commentary. >> bama could have learned from

that move. that was a crazy wide receiver defensive move there. >> it had been a tough game. you know things happen. they are talking tough about the team perhaps. >> there is no sound here. i would want to know what transpired? what was the conversation between that woman and those guys, and those guys by the way exercised restraint. none of them even came close to dealing with her. they just tried to ignore her. >> my heart goes out to this woman, as a reformed wild child, i would like to know how she felt the next day realizing there is a video of her, that's heart breaking the lesson is realize social media is out there and people are watching you. >> dennis? >> i have seen this action in a north carolina north carolina state game many times, it's not unusual. >> guys thank you so much for being here. have a great weekend, be safe. it's cold it's icy. fast money coming up in a few seconds. melissa lee, you guys have an exclusive interview, 3-d

systems. >> they made a big acquisition today which gets them into the toy entertainment industry. we'll talk to the ceo. kelly, this has been a high flying stock trying to reach the consumer market more maybe that's something you can do when you're snowed in this weekend. >> i was going to say. tell them we want them to print out some snow shovels. over to you guys. >> thanks a lot. have a great weekend. fast money starts now. live from the nasdaq markets in new york city's times square. here's the lineup. shares of twitter, up again today, gaining 8% so far in 2014. will it be the year of twitter? we break it down with the top analysts who says it's time to buy. it's bitcoin's fifth birthday today. we'll look at all the gifts the digital currency received. plus 3-d systems makes an acquisition taking a step in the entertainment business. we talk to their ceo. our traders, tim seymou