i think this is called mom's song. it's wildly popular on the internet. the moms are singing sadly about their sons getting older. >> awesome. >> thanks for watching "street signs," everybody. and welcome to the "the closing bell" on this monday. i'm kelly evans at the new york stock exchange. where the market is looking for direction on this, the third trading day of the year. >> it's putting it kindly. i'm bill griffeth. the day started out to promising. the dow was up 60 points on the open this morning. some of the economic data did not come out as expected. those service sector was a little weak at that point and i would point out it's too bad rick santelli is not with us today, that the bond market started acting like the bond

market used to act, the old normal seemed to be back today when the ism service number came out less than expected, the bonds rallied. that's the way it should work. >> some peculiar moves we should say in the bond market today. stocks weakened as soon as that report hit and that took us from being up 60 points to down 40 as we've had a triple digit swing if you want to call it that. the dow is off just about 5 points. the s&p 500 and the nasdaq are a little weaker, too. >> also, is it time to bet on marijuana stocks. pot stocks. >> be careful of the penny stocks we should be. >> marijuana is legal in colorado and new york governor mario cuomo -- governor -- >> andrew. >> having a history thing going on there. andrew cuomo is moving to ease some restrictions on marijuana use in new york. now, you can argue that the trend is certainly marijuana's trend these days, but we're look to look at how investable pot is right now. speak exclusively with med box

ceo bruce bedrick. the fund has been on fire. >> and weather wreaking havoc with airline travel. jetblue ceasing all operation in new york until this time tomorrow. we'll have a full report on when things may be getting back to normal and the damage this may be doing to the economy. >> show them the markets here. as you said, we open higher. we've gone lower. we're coming back again right now. >> that's right. we'll keep a close eye on what's happening in the bond market. we've a couple key auctions. a lot happening. building up to the earnings report. earning season from alcoa and then the jobs report friday morning. there's quite a bit this week. >> i'll be very interested to see how the demand is. show them nasdaq which is down ten points trading at 4121. technology has been a laggard for this market so far in 2014.

>> apple, google, they have been under pressure and pressuring the nasdaq in turn today. twitter is down quite a bit as a result of a downgrade at morgan stanley. facebook doing a little better. >> let's talk about this market see where we're going right now. joining us in our closing bell exchange, erica koogan, anthony chan a back from hawaii and thrilled about it. greg from empire asset management company and ron mullen ntion ca mullencamp. ron, you're our great value investor. after the kind of gains we've had, are you seeing value right now? >> value is getting a little harder to find. as you know, '13 was a year when you had to pick your shots. bonds reversed, commodities did poorly. most emerging markets did poorly. we were finding good values in the united states a year ago. we're still finding good companies but the values are getting harder to find. we think it will be a stock pickers market. >> greg, i don't know if you guys look at gold, but that's

been an outperformer this year to be sure. a lot of people who watch the charts saying maybe it's headed back up to $1,300 or $1,400 an ounce. do you think that's possible? >> no. >> in a word? >> the bull market is still real mature. we came to the market fully invested this year. we don't think you can trade the wiggles. the s&p had more than 90% of the companies in it up last year, over 460. i think it's going to be another year of great gains with strong economic underpinnings. >> greg, just to be clear, i was asking you about gold, and in this case we're talking about maybe whether it would rebound. so are you just want to make sure you heard me correctly. i wasn't trying to suggest the s&p was going down. >> not a fan of gold. >> okay. >> and you don't sound like a fan of gold here, ron. >> i'm not. gold is half religion and i don't have a basis on that. >> okay. we'll move on on that one.

erica, you still are constructive on this market, aren't you? >> i'm sorry? >> you're still constructive on stocks going into 2014. >> that yeah, i think there arel some opportunities absolutely on the upside but i would expect more returns than what we saw in 2013 and i would be prepared for a lot more volatility. i think it makes sense to not only be rebalancing but including asset classes and the portfolio that might provide some downside protection. >> i hear more people say expect more volatility this year. why? what's your reasoning behind that? >> well, i think you come off a year that already had a 30% gain. we're already trading pretty high and when i talk to clients i kind of liken the market to a pendulum swing. often you see valuations go above and beyond where probably they deserve and that's okay. investors can capitalize on that, but you still want to take gains so you don't get too top heavy when you see the pendulum start to come back down if there

is volatility. >> anthony, coming into the year, most people on the street had pretty aggressive price targets for the s&p 500 by year end. do you think the trading activity is giving them pause now. >> historically when you have poor trading the first couple days, people get a little nervous and that's on a technical side. if you look at the fundamentals, the economy will grow much faster in 2014 compared to 2013, and when you look at earnings and they're going to be keyed off global economic growth which is also going to be stronger than it was in 2013, that gives me a lot of comfort and a lot of source for confidence that in 2014 the market -- let's say the u.s. equity market will grow on the back of earnings growing close to 6%. >> what do you make of this extremely high ratio of companies that are warning or lowering their guidance for this upcoming earnings season versus those who are not? is this just gaming the system?

>> i'm encouraged by that. i think it will mean if you lower the bar it will be a lot easier to exceed and beat the system, but at the same time one of the things i'm most ex sicit about is the fundamentals really look a lot better. anytime you start a rally, it doesn't end a year after 30% gain. it normally continues, and i think in 2014 you will see that, and you will broaden it out to other international markets in 2014. >> ron, you think the ten-year should be yielding 3.25% right now. at what point does the higher yield start to provide enough competition for stocks that it gets in the way here do you think? >> just to be clear, we're reading inflation at about a 1.7%. historically the 30-year has been 3% more than that. the 10-year is about a 2% more than that. so, yes, we think 10-year should be about 3.75. we think most of the damage in the bond market, 80% of it, has

been done unless and until inflation starts picking up. of course, the fly in the ointment is the fed is trying to get inflation up. >> right. >> so we still don't see big value in bonds, but at least you can get a little bit of return. >> and you don't buy gold? >> no, certainly not now. >> greg, what are your topics for 2014. >> bill, by the way -- >> go ahead, ron. >> bill is going to be very constrained if he can't do any more puns today but i sympathize. >> she hates puns. >> i do. greg, what are your topics for 2014. >> we like the financials. we think it's an eventual trade. although the fed will have the easiest monetary policy we've seen, they've said we are going to, we are going to, but 2015 we will start to see rates. i think you will see a change in the yield curve. that change in the yield curve will be more profitability to banks. financials, lending, everything that comes with it. we like the financials for 2014. >> a major bear on financials

coming up next segment. just tease you on that. erica, what do you like for 2014? what would you buy here? >> we tend to steer away from trying to tactically pick specific industry groups but we're looking out for investing globally. i think you stay strategic to your asset allocation for u.s. developed international and you might see more opportunities coming out of emerging markets, global reits, infrastructure, but all of these are more if you're thinking long term and strategic in the way you're investing and not trying to look for short term blips or returns. >> okay. >> thanks, guys. >> we got it. see you later. >> thank you. >> have a good day. >> happy new year. you hate puns and i grew up on lou rick heisser. i'm all about puns here. down nine points as we head to the close. 50 minutes left in the trading session. the dow was up 60. we were down 40. we're hover around the unchanged level. >> stocks are struggling out of the gates and earnings season could make things worse for the

bulls. should you believe the pessimism? we'll get into this discussion a little more. and despite the bumpy start to this year, stocks certainly are not in danger of extinction anytime soon. when we come back we have the list of ten productses you should avoid buying because they are about to go the way of the dinosaur. and i have nine of them. >> we need to come back and see how many i have. the trend is a friend for the marijuana industry. new york state's governor set to legal medical marijuana. the ceo of med box gives us insight into that booming business. would you invest in pot stocks? keep it right here. you're watching cnbc, first in business worldwide. >> just no puns in those tweets.

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welcome back.

2013's record rally still trying to gain a foothold this year and the market has been taking investors on a roller coaster ride just today. jackie deangelis, what stocks are moving the market right now? >> good afternoon, kelly. let's begin with twitter because the stock is falling after morgan stanley cut its rating on the company's shares to underweight from equal weight citing growing competition for online ad revenue. but facebook rising after suntrust raised its price target by $10 to 65 bucks a share and reiterated its buy rating on the name. two solar panel stocks today heading in opposite directions. goldman sachs adding solar city to its conviction buy list saying that the company is well positioned to capitalize on the residential rooftop solar market but downgrading first solar to a sell from a buy saying that it is not able to take advantage of that trend. and pandora moving higher today as well after the company said that december listening hours increased by 13% year over year and its total share of radio listening rose to 8.6% in

december from 8.4% in november. and finally today, grocery store stocks falling a bit after the sector is suffering from this depressed store traffic that we're seeing. that's as winter storms across the east coast and the midwest are pushing logistical costs a little higher. kelly, back to you. >> jackie, thanks very much. now with a new year brings new changes and many things you have come to know as staples in our lives could be obsolete by the time 2014 ends. >> yeah. >> joining us now is market watch personal finance senior writer anna maria who put together a list of things who may soon go the way of the eight-track, whatever that is. >> i'll tell you later. there are ten things on the list you said do not buy in '14 p. i was joking during the break i have nine of them. >> i believe i have two, possibly three. >> a lot of these items are obvious, staples a lot of consumers have. but increasingly they are going out of fashion and there is data backing that up as well. >> i'm just go through them very quickly. we're not going to get to talk

about each individual lly but cable tv, land line service, gps devices, dvd and blu-ray players, hotel rooms which we'll get maybe to, two-year phone contracts, desktop and laptop computers, extra room in economy when you fly, credit cards with points or miles programs, and digital cameras. there's the list right there. >> here is what i want to know. is this because of convergence? in other words the same services we're all doing on our iphone or is this because our habits are changing? >> two things are happening. one is that the smartphone allows us to do a whole lot more. it's not just about making calls. we all know that. it's not just about internet surfing but it's also a new gps device. we don't need to go out and buy those individual devices to put in our car. we can just use our smartphone. those maps apps are free for the most part. that's all you need. similarly when it comes to even listening to music. it's not on this list but even if you think about ipods. they used to be all the rage but not so much anymore because you

can do that with your phone. also the digital camera. if you're not all that into picture quality and you just want to take shots wherever you go, you could just use your smartphone rather than going out there and getting a digital camera. >> hotel rooms. you point out and i have friends that do this, when they get to a particular city, they find apartments or condos that are for rent and they get a better deal that way. >> i think we're going to see more people doing that going forward. essentially what's happening are that room rates at hotels are rising, but why should you pay more for a room when you for the same price can rent out a high-end property, a villa, a penthouse? we're seeing more owners that are doing this right now on sites like air b and b.com. >> you know what you're pointing out is we live our lives to a great degree by rote. we get into habits, right? and we don't think about alternatives that may already be in our midst that might be cheaper, more efficient, or whatever. we just keep doing what we've been doing. >> and habits that are difficult to break.

we get used to having that cable tv and what am i going to do if i get rid of that service? where am i going to get all the favorite shows i want to watch? now, the second layer to what's happening here is that there are increasingly lower cost services that are allowing us to replace things like cable tv in our homes. for instance, looking at things like hulu and netflix, different internet-based services that are cheaper and cable tv, we can watch a lot of shows, sports games, on those services as well. >> those of you streaming us right now, hello, hello. >> the one that jumped out to me was about cell phone contracts. this has changed very quickly and this has huge implications. tell bus that. >> there's really no reason to sign up for the contracts anymore. they're more of a nuisance than anything else. here is the problem. technology as we all know changes at a very rapid pace. smartphones, one minute they're the hot thing, the next minute there's another one replacing. why should you look yourself into one smartphone?

if you want to break a two-year contract, you're going to have to pay about $200 to $300 with a major service provider. now, the service providers have realized this is going out of fashion with consumers and we have seen tat&t, t-mobile, verizon pushing things like no contract options and one-year contract options. if you're the type of person who wants to change technology, that a no-contract option is the cheaper way to go. on a monthly basis you will be paying about $50 a month which is about half of what most smartphone services options cost. >> credit cards with the points. what's wrong with those? >> well, this is a big one because credit card companies have been really ramping up the pitch. we're boosting our rewards programs. they're great. but they're really not that great because these programs are based on points and miles that these card issuers are devaluing. what you want to do is look for a card where it's cash back. a whole lot more

straightforward. i know for every dollar i spend, i'm getting "x" percent back. with these values, they're basically saying we are changing our programs to make you spend more to get what you would have gotten previously for less of a cost. >> again, that's that living life by rote again. >> the problem is it's a fiat point system, bill. if points were backed by gold, we wouldn't have to worry about such destruction of the value. >> it's also a really good effort on the card issuers part to put out these pitch that is sound so great. you want this card because it has such a great rewards program but when you dig deep, it really does not. >> well, i see changes coming in the griffith household in 2014. that was a great piece. got our attention big time. >> thank you. thanks. >> happy new year. >> again, major implications for so many of these companies even in the news today. we've got about 40 minutes left to go before the closing bell. the dow is trying to turn positive but it's still off by a couple points. the nasdaq and s&p are also in

the red continuing the streak. i love bob's note, he says people are coming up saying what's wrong with the stock market? why isn't it going up? >> it's always going up. investors have been tuning into liberty media's offer to buy sirius xm satellite radio. when we come back we'll hear from somebody who says sirius investors are getting hosed, and those are his words. >> the co-founder of the real estate broker claiming to be first in the nation excepting bit boy coin for purchases. we'll join us later on cleb. "the closing bell." that met wi, an unfortunate accident. while he's been incapacitated, "the closing bell." been paying. now, is this your doing? aflac? now, if i met with some such accident,

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welcome back. shares of sirius xm radio rallying on majority shareholder liberty media's offer to buy the rest of the company at $3.68 a share, and you can see it's up 7.5% today to $3.84. david faber has details for us. >> thanks, bill. yeah, you can see right there in fact it is trading above the implied price of that offer. you can forgive sirius shareholders if they're a bit confu confused. i want to boil it down for people. it's worth about $3.68, that was the price of liberty not too long ago, as of friday. down a bit today. you take a ratio essentially that is for our purposes we'll

call it 0.253. why? well, we don't even need to get to it. just trust me on this one and at the end of the day that's what will be issued to sirius shareholders. what do they get? they old 39% of a stake in what is liberty media which would comprise largely, that 100% holding of sirius satellite radio, also the 27% stake it owns in charter, the 26% stake it owns in live nation and you also own the atlanta braves there. but the company is arguing you get more than that. you get liquidity and you get rid of a lot of the uncertainty. here are the words of liberty's ceo greg ma ffei. >> an opportunity for sirous shareholders to participate in opportunities that liberty has, some of which might be attractive. we think it's appealing -- should be appealing to the sirius shareholders as well. >> a lot of opportunities there. the stock is trading a bit above the implied price of the offer

which is a low premium because there is an expectation given they will have agreed they will need a vote of the majority, the minority, not to mention a special committee that will negotiate on behalf of the minority that liberty will have to pay up a bit. we'll see how much more there is in expectation built into a certain extent that they will. will the market be right? will it be as much as the stock is being bid up? time will tell if, in fact, it does get done at that price. bill and kelly? >> we all know, david, that malone drives a hard bargain. he's one of the toughest negotiators around, but yet you sense as greg suggested, he sees opportunity here. so, you know, we've got various people who say that the shareholders are not getting a great deal in this particular case. i'm not asking you to put a valuation on this deal that they've put up there, but, i mean, is he driving a hard bargain here or is he being j

genero generous? >> in some ways it's both. they are a majority shareholder. you know you are a minority holder. they have control. there are certain things you cannot expect, bill. at the same time when you speak to those who follow the industry right now, they can argue based on the fundamentals this is a fairly attractive price that they are offering at this point. of course, a lot of it will depend on the strategic moves made by liberty as you become a shareholder there. but clearly you will still see the stock of liberty itself reflect the fundamentals of sirius. you can certainly say, well, why aren't they getting more? at the same time as minority shareholders what should your expectations be when you don't have control? >> david, that's the essence of it, right? because this was basically effectively a bailout for the company that happened during and after the financial crisis. unfortunately now the shareholders are in the minority position if they're not affiliated and there's nothing they can do. i love this line about how this means they will address the liquidity and uncertainty needs

for sirius shareholders. well, guess what? there's always uncertainty as a shareholder. i'm not sure liquidity is the argument this company isn't ultimately worth more to them but there's not ultimately anything they can do about it, is there? >> you wonder what the alternative is. this stock has never lived up to expectations. >> the company is doing quite well right now. there was an expectation it might go the other way. we must sigh reverse morris trust transaction under which liber liberty distributed its shares. certainly a vote of confidence saying we want to own all of it. kelly, you're right. what are your alternatives is the key question to a certain extent. and it does clear up some things. at least you will have a clearer path to understanding what you own and what can now be done because there is some uncertainty that goes along with being a 48% minority holder. >> yes, true. what about, david, as well the fact that ralph nader is now getting into this, putting out a press release asking carl icahn to take a look at the situation.

are they going do come up with a way out of this that current shareholders don't see? >> not that i can be aware of. in these kind of cases -- they don't want to call it a minority squeezout but essentially in many ways it is. they might argue with that term. it's not clear to me mr. icahn would be willing to take this on. he looks for leverage, points of leverage, and i don't think he's got them here nor does he want to go toe to toe with john malone over this one. >> we don't want to hover over the carl eicahn twitter account. >> that would be a big surprise. he's got plenty on his plate as you both know. >> yes, he does. >> thanks, david. david faber on the sirius xm satellite radio deal. let's take a break. we have 30 minutes left in the trading session. we're down seven points. market just kind of meandering here. >> it's been very flat this last hour. not doing much to change the picture yet. it's been a really rough start to 2014 across the nation. also when it comes to the weather. the earnings season could be

even rougher at least for the stock market if you believe the way the earnings warnings are hitting wall street. find out if it will really be as bad as companies are saying. and from a delta plane skidding off the runway to a small plane making an emergency landing on a major highway in new york city, the weather does continue to have a huge impact on air travel. jetblue, if you haven't heard, waving the white flag in new york and boston, ceasing operations until tomorrow afternoon been this time. what is all this doing to the economy? we'll look at that as well when we come back. cnbc sector sort is sponsored by sector spyder etfs. welcome back. how is everything? there's nothing like being your own boss! and my customers are really liking your flat rate shipping. fedex one rate. really makes my life easier. maybe a promotion is in order.

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one thing you can say about this market clearly is the momentum is not there now that we saw latter part of 2013. >> when we galloped right out of the gate. >> and it's very different from last year at this time. there has been a very subdued tone to the stock market in

2014, this first week. i don't know what they're waiting for. janet yellin will be confirmed, know that. the taper will get under way sometime this month. >> and lot of anomalies, gold doing well even though they're talking about a stronger dollar. if you still though were to take what's happened and project it forward as a preview of what's to come this year, not the formula most people were expecting last month. >> as the winter season wallops main street, we're wondering if earnings season is poised to slam wall street. for every positive earnings preannouncement we've had for this coming season, there are no less than 11 negative preannouncemen preannouncements. >> it's the highest total we have seen. it's not a hugely long history but are the concerns warranted? joining us now with a preview is chris of riverfront investment management and chris whalen from carrington holding company.

guys, welcome. >> thanks for having us. >> chris, first to you. this is extremely unusual so what's going on? does this tell us there's some kind of bloodbath coming? >> i think it's kind of an interesting data point, but i don't know that i would call it a red flag just yet for a couple reasons. first of all, if we were reading the same report, the analysts that produce that report talked about, you know, the highest percentage of preamountainsments but they also talked about the fact that the actual magnitude of the preannouncement was lower than average. one of the lower ones on record. to me that snacksmacks a little of a management team starting off what could be an uncertain when you think about tapering and some of the political issues. it smacks more of management team trying to set expectations a little bit low so they can beat them going forward, and i know if i were a management team looking ahead into 2014, i would probably be doing the same thing. >> chris whalen, i know you don't like the financials.

we'll talk about why shortly -- >> i love the financials. >> what do you think overall is going to happen with the earnings season coming up here? >> well, look, if you look at the larger banks, they're guiding flat to down on revenue. earnings, of course, has double digit increases for most of the south side analysts and you're right, they always want to set the bar low, but, you know, we have a poisonous regoulatory environment, dodd/frank, basel 3. i believe that's why the job market is so weak. >> hang on a second. let's bring it back to this week. we have alcoa reporting, a bunch of companies following in the next weeks. once we work through this period, maybe the headlines look okay because we're going to see this repeated pattern of beat, beat, beat, beat but when all is said and done the earnings actually won't be there? >> well, not in the way they

have been in the past. i mean, in the banking sector we had a totally different environment before. if anything banks are still delevering so it's hard for them to make money. the volcker rule, same thing. we're constricting their ability to make money for that i own account. management has to go out and find new areains of revenue to replace what's been taken away from them. >> so do you like the financials? i'm misreading the notes if that's the case. >> bill, what i'm saying is investors have to temper their expectations based on the world as it is today as opposed to the pay it was five years ago. five years ago banks were 110%, 120% loans to deposits. now it's around 60%. they're underlevered. they're not making loans because they can't. the government is telling them only make prime loans. so for nonbanks, it's an opportunity for my company, but overall i think it's hurting consumers and tit's hurting job growth.

>> chris, tell me in the history of the world when management has not tried to lower the bar so they could beat that lowered expectation. >> they certainly always do that. but looking at 2014, you know, it's an uncertain environment for the u.s. economically, so i think it would make sense that companies would try to edge down. another thing that occurred to me, if you look at the dollar, from the end of q 3 the dollar has firmed up and i think it's up a little bit from the end of q3. so it could also be some of these export facing companies that maybe have ratcheted -- they've tweaked their estimates just a little bit to account for the fact that they won't have that tail wind of dollar weakness helping their export markets. >> yeah. people have certainly pointed out that if you look at the size of these lowerings, they're not huge. in other words, yes, a lot of companies are lowering the bar but it's not that much. still the dollar index, that's hardly enough even when it makes a big swing to really affect

operationings operations. >> but it's less of an actual tailwind. it's been a tail wind basically for a long time in the u.s., the weakness of the dollar which we think is coming to an end. the weakness of the dollar has been a huge tailwind for export facing markets looking back in the past. it could potentially be -- in my opinion, it's not going to be a headwind necessarily but it's less of a tailwind than it used to be. that could make a little bit of a difference. >> chris whalen, i'm not done with the banks yet. if the fed is going to do this tapering, theoretically long yields should go up. theoretically that's good for banks out there. wouldn't this be a boon for the banks down the road? >> oh, i think so. you know, the story nobody focuses on is how low rates are hurting consumers. if you take grandma's savings income away, she's not going to buy presents. the other thing remember is that the banks have $3 trillion parked at the fed right now that

they're not deploying in the economy. the fed is out buying bonds and they hand that spread to the u.s. treasury. that's not helping the economy. we need to see rates go up for a number of reasons. i think it would also help bring private capital into the mortgage market. >> you know, by the way, there are people suggesting that, in fact, just for the u.s. to keep a stable unemployment rate there may be structural reasons why the interest rate should be negative. >> yeah, but that's a neokeynesian view, kelly. they're not looking at the market in a supply side sense. you want banks to make money on their assets. if net interest margin for the top four gets down to 2%, which is where it's headed, believe me, the alarm bells in washington will be ringing. >> all right. we've got to go, guys. >> thanks chrises. >> chris whalen, how hot is in irvine, california? >> i can't talk about it. everybody hates me already. it's a beautiful day here today. >> how nice for you. see you later. >> we have 20 minutes left to go before the closing bell. the dow is off 24 points.

so the sell-off is picking up a little bit of steam here but we're keeping an eye across the other indecxeindexes, too. if you want the perfect recipe of stocks that offer growth and yield, stay with us because seema mody has unearthed several of these hard to find hybrids. after the bell, here is a story getting some real buzz, sorry. legal marijuana in colorado has the whole country talking about pot, of course. coming up, will the talking turn into investing? that's what we want to know. would you invest in a marijuana-related company? tell us why and make it clever. i know you will. we'll be back.

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with a signature. legalzoom has helped start over 1 million businesses, turning dreamers into business owners. and we're here to help start yours. welcome back. starting to lose some steam here again. the dow was up 60 points at the open this morning. down 40 at its low of the session. we've been kind of meandering here. technology once again, you see the nasdaq down the most percentagewise has been the laggard so far in 2014 and a downgrade today of twitter among others by morgan stanley has not helped this market as well. here we are with the dow down 20. nasdaq down 16, and the s&p down 3 points.

kelly? 2013 was an incredible year for dividends and stock buybacks likely at the expense of hiring and companies expanding. but can that train keep rolling this year? jeff cox, what are you finding as you sort through the numbers? >> thanks, kelly. well, you know, if you liked 2013 for dividends, you're going to love 2014. actually we're looking at taking what was a good year and actually having even a bigger year this year. i think somewhere in the close area of $350 billion expected to come in the form of dividends this year. that's up even more. we're around $310 billion, $315 billion for 2013. so, you know, all this just begs the question of this dichotomy we have between the main street economy and the wall street economy. you know, companies instead of taking their cash, that $1.9 trillion in the corporate balance sheet, instead of using that for cap ex and employment, they're expected to just go

right back ahead, give it back to investors in the form of dividends and also stock buybacks. i don't know if you saw the barron's piece today, very interesting story. talked about $445 billion in stock buybacks over the most recent 12-month reporting period. now, market reported a bunch of this data. they're projecting apple to actually have the biggest dividend this year. about $11.8 billion. exxonmobil second at about $11.7 billion. you can see the chart there. at&t, microsoft, and ge also expected to really be up there. this just begs the question, are companies going to start taking their money and putting it back into the real economy or are they just going to keep lining shareholder pockets, bill? >> good question, jeff. thanks. jeff cox there. so that's his take on dividends in 2014, but if your appetite leans toward growth and yield, seema mody has uncovered some of the so-called hybrid stocks that might be worth your attention as well. seema, what did you find?

>> as rates pick up, b of a says expect investors to shed the extremes of high yield or high growth around find a hybrid. we went looking for stocks with consistent earnings growth and an attractive dividend and found quite a few in the financial and technology sector. bank united, wells for go, u.s. bank corp all offer a dividend yield higher than the s&p 500's average of 2% and these companies have witnessed steady earnings growth over the past three quarters. and within the technology space, cisco, it's latest earnings were impacted by weakness in emerging markets, but it's seen an 18% jump in earnings over the past one year. cisco has also consistently increased his dividend payout over the past three years. now, another hybrid tech play is symantec. growing concerns over data breaches could result in corporations shemilling out mor cash for security. investing in the hybrid stocks is most appealing to money managers who aren't willing to take on a whole lot of risk.

experts say that's why returns could lag those of growth-only funds. bill and kelly? >> seema thanks very much. we had the same response. art cashin just walked by and said the bias is toward the buy side. >> we'll see if that moves the needle to turn the dow back positive as we enter the final 12 minutes of trade. >> so afar it's not. >> bitcoin is booming. it was back above $1,000 mark after zynga said it would start accepting payments. one real estate broker says he will also accept the currency to buy a home. we'll talk to him. and the queen of new york real estate dolly lenz will chime in on whether it's a bit crazy or not. keep it right here. mine was earned orbiting the moon in 1971.

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about nine minutes left in the trading session here. art cashin told us there's about $800 million worth of stock to buy as we head toward the close but we're not seeing that seep into the market yet. market has come off its lows but

we're still seeing this rather lackluster session. joining me jeremy hill from affinity investment advisers and our own bob pisani. bob, you just wrote a little while ago, people keep saying what's wrong with the stock market. >> they keep complaining, there's something wrong. people think the stock market should go up every day is what's wrong with the stock market. >> didn't it last year? >> yes. so far what we have here is not a lot of money being put to work. the volume is anemic today. right now we'll maybe to 3 billion shares. we're not seeing a lot of new money come to work. i don't see a lot of bets being made. >> what do you think is going on, jeremy? >> i think the theme for 2014 is strength begets strength. i think equity investors are going to suffer from what we call the recency effect and that means they're going to remember what happened last with more import than what happened in 2008. 2008 you lost a lot of money in equities. last year 30% gain.

it's being advised with neon vegas-like lights. you combine that with the fact that last year was the first time since 1999 that bonds lost money. we think people will allocate back to equities side. >> but it's a tough call this year. for example, last year everyone was into dividends. dividend stocks couldn't perform as well as the overall market. emerging markets underperformed the overall market. gold got killed. so it's a tough call. >> some of those are rebounding. >> some are. >> but i would really avoid the bond proxy kind of stocks. there are a lot of stocks, utilities, the reits, the telecoms that were bought for the last several years just to get that dividend, to hide out in safety. i think you have to transition into more of an active management environment. i know that gets a lot of people upset when people say it's a stock pickers environment, but it could be this year, and i think what we're going to see is a bit higher volatility, a bit lower correlation, and a bit higher dispersion between

prices. >> i guess because we're going to go through this awkward phase where we've been through some great gains over the years because of fed policy and now as they begin the process of just eyeing the punch bowl, the market is going to have to readjust again. >> one thing they seem to be expecting is higher interest rates. i have noted all day that the big cap banks have been the outperformers so far. they're the one that is would benefit from a steeper yield curve. i'm going to be very interested, you have got some very big treasury auctions tomorrow, wednesday, and thursday, be very interested to see what the demand is for those notes and bonds knowing that the fed is not going to be buying as aggressively as they have in the past. >> that's right. also this week i would argue for the first time in about a year the jobs report is less important than the fomc statement and also what the fed governors are saying this week in their various speeches. >> i think we're going to be watching that jobs number -- >> i think it will be fairly important actually. determining the pace of qe will

be critical. >> i don't think one jobs report is going to change the way the fed looks at what the they're doing right now, the velocity of taper, whether we get 100,000 or 300,000 jobs. for the first time actually the fomc statement has more import. >> all right. jeremy, good to see you. >> thank you. >> bob, see you around here as we head toward the close. we have the closing countdown coming up here with the dow down 17 points. then after the bell, colorado as you know has become the flash point in the legalized marijuana debate. so as sentiment grows for other states to follow colorado's lead, investment opportunities are now presenting themselves and we've got one of them coming up. the ceo of one company whose stocks have already taken off on high hopes for marijuana joins us exclusively. we want your tweets on whether you would invest in a pot related stock. that's coming up on closing bell. stay tuned. [ male announcer ] this is the story of the dusty basement at 1406 35th street the old dining table at 25th and hoffman.

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technology overall has lagged this market in 2014. and jetblue suspending operations temporarily in new york just to get themselves back on track after the horrible weather weekend they had. that stock is down 4%. operations in new york and boston, not overall. peter costa, what's your version of why we're seeing this malaise in the stock market so far this year. >> bill, i'm going to tell you, i think it might be waiting for earnings. i don't see any -- the numbers this morning, i thought that would be an impetus for some movement, significant movement, about you it obviously didn't. >> are you expecting a good or bad earnings season? >> i'm expecting a better than expected earnings season. >> okay. >> and i think i'm in the minority right now because i do think that a lot of companies have really cut back on their forecast and i do think we're going to see a better earnings season at least for the fourth quarter. going into this year i'm not sure but from last year, i think you are going to see better numbers. >> all right. thank you, peter. always good to see you.

thank you for your thoughts. annual tradition at the new york stock exchange young people's chorus of new york city ringing the closing bell. they will be serenading for you as we get ready for the second hour. wait until you see the high powered panel kelly has lined up for the second hour of the cl"t closing bell." i'll see you tomorrow. >> i'm kelly e echely evans. it looks as though we will see red arrows across the board. the dow losing momentum just in the moments before the close. so it shed almost 50 points. 16,425. that's level. take a look at the nasdaq. same thing, off almost half a percent. down 18 points, just above 4,100. and the s&p 500 off just about 5 points. let's ask the panel. thank you so much for being

here. and i'm going to borrow a line from bob pisani. people are coming up to him saying what's wrong with the stock market? it's not going up. >> this was a stock market that was up massive last year. if you look at what happened at the end of last year, we were in a statistical situation that doesn't happen very often. it was up, up and away. this is just a couple days' worth of these gains possibly just digesting what's going on. consolidation. but again this is nothing to panic about. what we would want to see is perhaps a little bit of a base building for a nice move higher. that remains to be seen. >> all right. people are just waiting to buy the dips, kayla, right? >> i like what bob followed that line with, which was the only thing wrong with the stock market is that people think there's something wrong with the stock market if it doesn't go up every single day. we don't really have that much to go off of besides a few chappy data points. data out of china is a little weaker. we don't have earnings yet. it's not looking like we're going to get incredibly strong

earnings. and then, of course, the jobs number this friday. there's a lot of waiting and a little profit taking. >> earnings, it feels like we haven't talked about earnings in so long. now this season is going to be a long one, just the schedule. we're going to have several weeks of heavy earnings report instead of that concentrated period we get sometimes. are people when they look ahead to the next couple weeks, is this a time to kind of wait and see what happens or is there anything to that whole strategy of trying to play around earnings season? >> i would say it's just like the after christmas sales. you wait until something is on sale to buy it. you no knknow there's going to some pressure. we talked about some folks who didn't want to take profits last year because they have to pay tacks. this is the reverse tax selling to take a loss in 2013. now they're taking profits in 2014, and they've barely moved the needle on the market. i mean, are we down 1%, guys? >> barely. >> keep an eye on the vix

because that's important as always. are people more fearful? no. so these are very mild sell-offs here. i will be adding to long positions in some of these if they sell off far enough the likes of apple, for instance. big turnaround in apple today. it was down over $10. came raging back. i like that. i'd love to see more of that in some of these stocks. >> it's a great point. remember, this is the time to get your shopping list together. everything you want to put on your grocery list, the bread, butter, when the time comes when the market does dip, you are ready. >> we learn something about the company that changes the thesis altogether. people say we knew margins were can desill rati sell rating. should you be ready to jump in when it may be for a good reason? >> that's a good point. we heard some initial evidence that the holiday shopping season may not have been as good as everybody thought it was. you have also got a situation

now where the economy is starting to show signs of life but maybe some of these indicators are going to give people a moment of pause. we haven't had a 10% correction in a couple years. >> since august, 2011. >> there is something to be said about this idea we could see a 10% correction which is big and there still could be room more a move higher. >> dolly, you have your ear to the ground in such a unique way. being in the manhattan real estate market, kayla was just referring to some of the weakness, the deceleration we're starting to get across china. what do you think is going on out there right now? >> i have to tell you, just in the very, very short window, the weather has had a huge impact on certainly real estate sales and i bet a lot of other sales as well. i mean, i flew back in from miami just to meet a client, okay? guess what? i made it, she didn't. so she didn't get to go on tours. i was here kind of going like this because i didn't have any other appointments. i bet the same is true in a lot

of other areas. the weather has had a big impact on buying. >> here is why i'm laughing because this morning we had a vehement argument over whether weather has an impact on the economy or not. and i think what you have just indicated is that perhaps there really is something different this time. because i'm skeptical. i would like to think, you know what? for every dollar that's not spent in one part of the economy, that he is a dollar spent on your heating cost, for example, but this to me sounds like, well, maybe there was more of an effect than usual. >> first of all, everybody is talking about the weather. the weather is all you see on tv. weather, weather, terrible weather, terrible weather. everybody is predicting what the weather will be. it will be the worst weather in 100 years. it's taking up all of our time and all of our eyeballs, and i think that keeps us away from doing other things we might have done. like watching apple. like doing other things we might have otherwise done. >> and dolly, just like when a t hurricane is hitting, it hits a specific part of the country whereas this cold front is

across the entire country. virtually the whole country. atlanta has windchill warnings. new orleans has them as well. so that is i think filling up walmart for people to stock up on stuff. >> exactly. >> not to board up like you do with home depot when you have a hurricane, but stocking up on things as well as probably natural gas drawn down because of the cold. >> there's always a flip side to this and it's really about the strategy of the stores that are trying to market to these consumers. after hurricane sandy, everyone said it's probably not going to affect the people like home depot s or lowe's because they sold to many generators and batteries. the type of products they sell is totally different. even when you're holed up at an airport, people are probably sidling up to the bar and dishing a lot of coins out that way. some of it depends on the promotions and some of the retailers that are trying to get that business. it's really a shifting of money. >> online, too. online sales. what dolly can't sell yet is apartments and homes online, but

certainly these retailers can. so if they're not going through the doors, i bet they're going through online. >> i will say this though. the weather has had an adverse impact on supply chain though. stores maybe not age to get stuff to the shelves. >> that's a good point. >> grocery stores have perishable items going bad. there are effects we're not even talking about. >> i want to on that point bring in guy adami to this conversation. guy, your response to the weather or anything else? >> first of all, congratulations on that forbes under 30 list. is that what it was? >> yeah, ya he. >> eight years from now you will be the for bes under 40. i still think the most important thing for the market if you're bullish is if it's a trade lower than we are now. i'm in the 1760 camp. i have been in that camp for a while. it hasn't worked out. i still think we need to test down that that level. i think this earnings period is about the most important earnings period we've had in a long time.

>>? why? >> i think the good stocks will be rewarded. i think the bad reports will be punished more than they have been over the last couple years. >> we're separating the wheat from the chaff. >> more so -- >> that's different because that suggests that you may not necessarily -- so there are two theories that are out there. the one is you want to jump when you see stocks you like at a discount or maybe get cautious if the ones that you have been -- >> and you were talking about get -- >> but if you're saying that instead what people should do is stick with the winners and get away from the losers fast -- >> no question about it. but to that point there will be an opportunity to get into the losers. dominick was saying get your laundry list ready. that's great. the problem is when these things go down, it scares people away. like, oh, my god, it went down for reasons i didn't think it would go down for. i can't buy it here. it's always that way. you have to take emotion out of this game. i have told you for a while, that's what's important. the one thing that stuck out to

me, i'd be remiss if i didn't mention it, goldman sachs put out a note on biotech, specifically cell gene. i love goldman saks, i worked there, but they have been dead wrong in this space for several years. they have brought in a number of analysts to be dead wrong in tow. i'll tell you right now, i'll come back on a week from now. i guarantee you there will be an analyst that comes out with the exact opposite call on cell gene and we'll see where it was back where it was. i love goldman. i'm just stating fact here, girl. >> guy, thank you so much for joining us. everyone sticks around here. you be sure to catch him and the rest of the "fast money" crew coming up at 5:00 p.m. ahead, jetblue slamming the breaks on all flights in and out of boston and new york as of 5:00 p.m. today.

plus, a warning from economists on the potential for the extreme weather. also ahead it's a big apple first that may catch on in your neighborhood. a manhattan real estate broker accepting bitcoin for transactions for real. the head of the real estate brokerage that is accepting the currency speaks to me next. you know dolly will have a thing or two to say about that. you're watching cnbc, first in business worldwide.

welcome back. so jetblue halts flights at four major airports in the northeast. thousands of flights of other carriers already delayed or canceled in. in short, it's a mess. let's go live to phil lebeau at chicago's o'hare airport. phil? >> reporter: a lot of frustrated travelers here at o'hare airport. back here we still have several hundred people who are rebooking their flights at american airlines. all day long these people have been standing in line. many have seen their flights canceled two or three times. overall, when you look across the united states, more than 4,000 flights have been canceled. according to flightaware.com. more than 11,000 have been delayed. i'd like to tell you it's going to get better, but, unfortunately, this deep freeze is going to be sitting over the

upper 34es at least for another day and then as it moves east, look for more flights to be delayed as well as canceled. a big problem, flight tarmac operations. the crews cannot be outside exposed for very long when you have a windchill of more than 30 below here in chicago and at other airports in the upper midwest. as a result, equipment is freezing. it's tougher to fuel those planes. both united and american here in chicago as a result of those tough conditions, they have stopped all regional flights out of this airport today. that may continue tomorrow as well. the bottom line is this, guys, we're seeing at least 4,000 flights canceled today. when you factor in last weekend as well as the next several days, we could see more than 10,000 flights canceled. you're starting to get to numbers that compare with hurricane sandy and how many flights were canceled then. it will be interesting to see what kind of impact it has on the bottom line for airlines when it's all totaled up.

guys, back to you. >> 10,000 cancellations. phil, we're just glad you're inside o'hare. stay warm out there. our own phil lebeau from chicago this afternoon. phil, thanks. now, it's winter. planes get grounded, people stay home instead of going to the movies or restaurant. how much impact does weather this bad have on the u.s. economy? no one better to ask than evan gold. thanks for being here. >> happy to be here. >> can you put this storm if perspective for us. i don't know what terminology to use for us, this unusually told period across much of the country. what kind of economic impact do you think it's going to have? >> we're seeing the coldest temperatures in 20 years, and really what that's going to mean is hundreds of millions of dollars at stake. we were talking earlier just now about flight cancellations. someone earlier was talking about real estate. it really covers the gamut. certainly retail is significant right now even though we've just passed the holidays. a lot of people have gift cards

burning a hole in their pocket. they're looking to spend those. there's an impact across the board. >> what i would argue is that the impact is a reshuffling ones. there are people in real estate or autos, we saw auto sales last month get hit. at the same time natural gas prices have been soaring today because of the demand which they think is going to be the highest demand ever in the country, today, tomorrow probably setting another new record. the aggregate effect i would ges is largely a wash. >> well, you certainly make up a good point. in some cases you do see a shift. maybe people bought groceries last week instead of today but people have been staying at home because of work. so maybe some people aren't getting wages, they're not going to get money from that. there is a net economic effect. i think the recent study showed the impact was 3.4% of gross domestic product was impacted by the impacts of weather and weather events like we're seeing today. >> to be clear it meant 3.4% of

the economy, so if we've got a $17 trillion economy, it's a small portion of it. that does come at a time when people are trying to assess what direction the economy is going. so what happens in the fourth quarter, whether it's another 3% or 4% quarter after the third quarter has huge bearing on everything from what the federal reserve does to the way that investors are allocating their money. >> absolutely. >> prerhaps from that point of view every little basis point matters. >> it sure does. any impact that's going to cause customers maybe to spend more on their home heating bills in 30 days versus out spending it in the general economy, yes, that's going to have an impact. >> if you were to get specific and say who were the winners and losers, what would that list look like? >> sure. well, from a winner perspective, the online retailers, on demand businesses. restaurants that specialize in delivery do really, really well this time of year. anybody that's selling anything related to cold weather gear,

this is the time to clear that product. the retail calendar shifts to the spring in 30 days, but if there's any inventory left after the holidays, now is the time to get rid of it. >> can you just give a sense of how unusual it is historically to see a storm or a period of extreme weather like this that does enough to really show up as phil lebeau was just mentioning, it sounds like if we have 10,000 flights canceled that would be the biggest weather related cancellation activity we have seen since hurricane katrina. >> it's the number of population center that are being impacted. over 100 million people are being impacted by the storm. it's extremely rare. we talk about tornadoes or other events and they are certainly significant but this is significant because of the number of people that its hitting and it's extremely rare. you don't get these very often. >> that's a great point. evan, thank you so much for being here and stay warm. bundle up. appreciate it. >> thank you.

and be sure to catch j jetblue's coo coming up. that's coming up in just about 40 minutes' time. let's send it over to jackie deangelis for a market blast. we were showing palo alto networks. >> palo alto networks higher in the after hours session. helping customers fight advanced cyber attacks that can come from foreign hackers. fire eye last week said it would buy -- that's a company that includes a cyber swat team known for outing chinese hackers. take a look at that stock up 3% in the after hours. >> and you heard it from jon fortt on this program who when that deal happened said you have to wonder what a palo alto networks does next. thank you so much. forget about the old cash real estate deal, how about the old

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jumping on that so-called bitcoin bus. it's causing a price rebound. zynga is the latest announcing in a read it post over the weekend it's accepting bitcoin for in game purchase for game offerings like farmville around castleville. that helps send the bitcoin price back up. it's currently trading around $1,030. the last time we saw it climbing this high was early december when it hit $1,230 before sheddingnearly 50% after regulators in china began cracking down. >> it seems to be recovering from that setback in china. can we expect the bitcoin price to say this high now? >> i spoke to a number of analysts today. what one analyst very coyly said is volatility is almost guaranteed where the price of bitcoin is concerned. the question is whether that volatility is moving up or moving down. two interesting points, one is that some of the bears where bitcoins are concerned really

thought the china regulations last month would really cause the end of bitcoin. the fact it has rallied is very notable. the other number is 7,600%. that's how much the price of bitcoins are trading up versus this time last year. >> not too shabby. mas mas a real estate broker in manhattan is now accepting the currency. noah freedman has announced his company will accept the currency. what's really going on here? >> we are accepting bitcoin for our commissions and one of my agents was a bitcoin miner, came to me and said, i think there's a lot of people out there that would like to pay us in bitcoins, and after i looked into it, i thought i'd be crazy not to accept them as payment. >> so to be clear, you're not taking on any exposure to bitcoin, correct? because whatever price you agree to is in dollars and it's just

up to the bitcoin holder how much that's worth in bitcoin, correct? >> that's correct. the merchant service provider will take their bitcoins and instantly transfer them into dollars. for me it's pretty much the same. i'm just providing a mechanism for them to pay me in bitcoin. >> stay there if you will because i want to bring in the panel. i want to get dolly's thoughts on this. have you had perspective clients come to you and pay in bitcoin? >> if i did, i would be concerned. i would wonder why do they want to pay me in bitcoins. why did that money come from. it would really cause me to pause as to dealing with that client. so that would be a worry. that said, assuming this goes further and bitcoins actually come into some vogue and my sellers accept bitcoin as currency, then i'd be perfectly willing to accept it, but right now it has a dark side to it. >> noah, what do you say to that? >> i think there's been some

nefarious uses for bitcoin but i don't think there's anything dark about it, and the difference between buying properties in millions of dollars or accepting commissions in thousands or tens of thousands is a big difference. >> so you're only accepting commissions. in other words, if i buy $1.5 million property, how much would i actually likely be paying in bitcoin? >> $45,000. >> still a significant amount of money. >> yeah. it's not peanuts, but it's not millions either. >> i'm curious what the rest of you think about it. >> i'm curious about the volatility. when your transacting in bitcoins you have to become a trader right off the bat because you have to manage the rick. this is a currency that swings, 5% to 20% in day. you have to immediately figure out whether or not you want to lock it in now, wait it out, maybe do it a little bit later on but no matter what you're managing a book of risk and that's what you have to worry about i think in my mind, right? >> the way we have it set up with our merchant service provider, as soon as the person

pays, we're instantly cashed out in the u.s. dollars. we actually have no volatility risk. >> are they paying at the point of contract? >> yeah, at the point of closing or at the point of a lease signing we would send an invoice to them and they would pay in bitcoin equivalence of the dollar amount they owe us and we would ib instantly cashed out in dollars. noah, why did you feel the need to make the leap on bitcoin? if a customer came and said i had like to pay for my apartment in gold bars any real estate broker would say why don't you convert your gold bars to dollars and pay me in dollars. what do you see in it? >> it's fast, easy, and it's cheap. obviously getting gold bars would be highly inconvenient. i can get bitcoin in a day and i don't have to charge a transfer fee. it's free to transfer the money which is better than credit cards. >> there must be a commission on the bitcoin transfer, no?

there must be a commission between what you get the bitcoin at and what the dollar is. >> does bitcoin take a cut, noah? >> if you buy bitcoin on exchanges or deposit your money, you do pay a percentage. when you transfer money to me, there's no charge. >> what does a could op board in new york think in a buyer is paying in bitcoin? does that raise red flags? >> i don't know yet. >> it will be interesting because to your point, kayla, as far as gold bars, if somebody brings dolly a briefcase full of hundred dollar bills -- >> cash. >> then you have anti-money laundering concerns. the same concerns are true here with a bitcoin transaction of $45,000 or more dollars. again, that's a relatively low value apartment or sale in new york city. >> let's be honest, this wouldn't be the first time somebody used real estate as a money laundering mechanism, right? >> noah, final word on that? >> i would have to think that new york real estate would be the singularly worst way to launder money between credit

checks, income verification,co op boards. by the time you get done getting an apartment in new york, they know everything about you except your underwear size. >> dolly, is that true? >> no, because you can buy from a sponsor and from an llc and nobody would ever know no you are. >> will you come back in six months and let us know how to goes? >> absolutely. >> know washingtnoah, thank you. coming up the latest vote to confirm janet yellin as fed chief. there's a look now at capitol hill. plus, gary stern's name has been tossed around as the fed's next vice chair. the former minneapolis fed president will speak exclusively with me next. keep it right here. welcome back. how is everything?

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welcome back. janet yellin's confirmation is expected in the senate sometime tonight but you never quite know when it comes to washington. eamon javers, smooth sailing or do you expect surprises? >> we expect smooth sailing at this point. one thing to watch for are going to be the no votes. remember, ben bernanke got a record high of 30 no votes in the senate the last time out.

that was the highest since paul volcker got 16 no votes back in 1983. we're going to want to watch those because i think that's a bit of a barometer of sort of the fed's political health in the united states senate. see if she gets that all-time record of no votes this afternoon. but we do expect she'll sail through and we do think that they've now gotten enough senators here in washington despite the travel glitches around the country they're going to be able to get this vote off with no problem. >> we'll keep an eye on it. thank you so much, sir. so more now on what janet yellin might mean for the global economic system because in a cnbc exclusive we're joined by gary stern, who is former president of the minneapolis federal reserve bank. welcome. >> thank you. good to be back. >> i bet you're glad to be here and not in minneapolis right now. >> it's much more moderate here, yes. >> minus 27 was the reading when my brother left this morning. >> yeah. it's pretty cold out there. >> what about for the federal reserve which is looking towards a 2014 defined perhaps by a new chief, several new board members including a rotation of the

regional presidents at a time when they have this incredibly ambitious tapering effort? you said and expected they would taper in december. what happens now? >> well, i think the tapering will continue assuming that the economy performs as they anticipate and as i anticipate as well. i think the economic outlook for 2014 is reasonably positive. i expect unemployment will continue to decline. i think inflation will remain low. and i think in that environment it's pretty straightforward to continue with the tapering. >> what doesn't seem straightforward is what's happening with the unemployment rate though because it is to some extent falling for the wrong reasons. as unemployment benefits expire if you look to north carolina which has an early experience for this, people are dropping out of the labor force so ironically the lower the unemployment rate goes is because the labor force is shrinking and then benefits are expiring because of that. in other words, it's like the negative kind of vicious cycle. >> the fed is very good at analyzing all the ins and outs of that kind of thing. but they have set up this

threshold of a 6.5% unemployment rate where they would at least presumably consider raising short-term interest rates. now, if they feel that the decline in the unemployment rate is largely artificial for the reasons you cite or for demographic reasons or other things, my guess is they will change the threshold or ignore it and won't begin to raise interest rates under those circumstances. >> because to be clear, it's possible if all of those -- if jobless benefits expire for the 1.3 million this month and then more in the months ahead and nothing is done in washington to change that, the unemployment rate could go from 7% now quickly to of6.5%. is it your view they might respond to that by, for example, using the inflation target and saying maybe we're going to put a floor under, you know, acceptable levels for inflation? >> yeah, that's one thing they could do or they could simply say looking at all the dynamics in the labor market, we think 6% is a better number or they could

say, you know, part of what's happening here is people are retiring a little more rapidly than we expected. that actually does affect the capacity of the economy to grow and so forth. so there's lots of analytical adjustments that they can make. >> does that leave them with a communications and/or credibility problem if the goalposts keep changing? >> well it certainly lefers tavm with a communications challenge and they have to explain as best they can their thinking. i don't think that's an insurmountable challenge and if the explanation makes good intuitive sense, it will not adversely affect their credibility. if it seems to be a little bit of grasping at straws, then, of course, it will affect credibility. >> simon johnson this weekend in philadelphia was vehement banks have gotten -- that the too big to fail problem remains for banks in the u.s. and globlly. they don't have nearly enough he

canable -- equitable debt. is it your view that we still have a problem with banks that are too big to fail in this country? >> we still do have a too big to fail problem. i'm not quite as negative about the situation as simon. i think there has been progress made by some of the steps that the fdic and the federal reserve have taken, and in particular i would place a lot of emphasis on the so-called living wills, resolution and recovery plans that major financial institutions have to prepare. i think if that is done well and if the regulators really insist that it be done well and they get bank board of directors involved, we can rein in, not eliminate, but we can rein in too big to fail, diminish the scale of the problem, reduce the probability of severe financial crises going forward. >> his argument is it's less about how the institution sees -- leaves a will and more about knowing who is he can

posed to that institution. which pension funds, which global money market funds are exposed to that. we still don't have that level of transparency. >> no, but the living wills do require that. he's quite right, we have to pay attention to who the counter parties are, who has the exposure, which markets do these institutions rely on for funding and so forth. now, those are issues that require a fair amount of resources to really get your arms around. but it's not impossible, and i think good progress is in the process of being made but we have to get to the goal line. this is the playoff time in the nfl and scoring is very important. >> final question, have you heard from the white house with regard to taking one of the open positions on the federal reserve board? >> no, i have not heard a word from the white house. >> just got to throw it out there, gary. you never know what could happen. thank you so much for being here. >> good to be here. >> former minneapolis fed president gary stern. let's send it over to jackie

deangelis. >> two big movers. we begin with neurocrine biosci. the stock is up. and convergys. both companies are providers of customer management services. >> extreme temperatures blasting much of the country but we have just the prescription to warm you up. the hot list from cnbc is coming up next. check out medbox shares more than tripling from just two weeks ago. medbox's ceo will speak with me exclusively next about what's driving the marijuana dispensing machine makers stock higher. and we want to know if you would invest in pot stocks. tweet us at cnbcclosing bell. we'll put the best tweets on air after this. ♪

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i wonder if i can see mt. rushmore from here. geico. fifteen minutes could save you fifteen percent or more on car insurance. welcome back. it may be freezing outside but websites hotter than ever because allen is at the helm. >> we have had this story, it's been a glowing ember for us all day long. it's basically apple, amazon downgraded. that's not news except for moral reasons. then that's why readers are jumping into it. it's already logged up over 12 grand with readers popping in there. essentially ronnie over at standpoint research, he came out

with a note downgrading amazon and apple saying they have a whole bunch of money yet they pay their workers very, very little, and he feels -- >> not what you would expect in an analyst note. >> when do you hear that on wall street? i believe he's showing up on "fast money" right after your show. maybe more people if you're interested, check it out there. >> double tease. >> i have a horse race for the number two position, okay? number gold did that little dipsy-doodle about $30 dip earlier today quarter after 10:00? we've been trying to parse out why. our readers are really bugging into that story. there hasn't been less than 500 people reading it at a time at any given minute throughout the day. then finally we have art cashin, he does this special little video segment for us on the website. this one he talked about how he's a little worried that the dow has a pronounced divergence from other indexes and it's freaking him out a little bit. also he talked about the cold weather which you have been talking about a lot in your show and his worries about what that might do to the economy. so we've got them burning up

here. >> and both of those points that he makes are important ones. allen, thank you so much. a lot of gold bugs on the website. flying high medbox shares soaring more than three fold. the head of the marijuana dispensing maker explains why. that exclusive interview is coming up next. send us your tweets on whether you would invest in marijuana-related stocks @cnbcclosi @cnbcclosingbell is the handle. and it feels like your lifeate revolves around your symptoms,

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new year, new era for marijuana. recreational pot is legal in colorado and washington state. medical marijuana is legal in 206 states plus the district of columb columbia. jane wells, what's turning the tide? >> public opinion, kelly. i compare it a lot to gay marriage, although in the case of pot new york and new jersey have really been behind at least compared to the west. there was a seen na college survey where 82% of new yorkers favor legalization of medical marijuana. most places it's enacted through legislatures. he's found some law that he can do this by executive order in a

very limited way in new york which we'll find out more about on wednesday exactly what he wants to do. it's going to be very, very small and restricted. >> just taking a look through some of the changes that are coming up. jane, what else, by the way, is lighting up the marijuana business? because it seems like more so we're hearing on wall street people just want to play some of these names. they want to know how to invest around this. they think this is a big deal change. >> well, it is a big deal change. you see all these sort of funds starting up right now because you can't really get a small business administration loan from the federal government if you want to start a pot business. the problem right now we're heading back to colorado later this week, is there's just not enough supply to meet the demand. demand has gone through the roof. they weren't able to license enough growers in time. they're using what they have leftover of medical marijuana to sell at a retail level. a couple places have shut down until we restock. according to "time," the first day -- there's only a couple dozen times open, they had $1 million in sales. that would equate to $250,000 of

taxes. you can see that second line there, medical marijuana, they collected $6 million worth in a fiscal year in colorado. that's a lower tax rate. that $219 million, if that was retail pot, that would have been over $40 million in sales taxes to the state of colorado. >> this is what austerity has begot. thank you so much, jane wells. really appreciate it. so speaking about the business of marijuana anyway, medbox, the marijuana dispensing machine maker, that stock up more than 100% in the past month. with me now dr. bruce bedrick who is the ceo of medbox. dr. bed ririck, thank you for bg here. >> thank you, kelly. nice to be with you. >> what do you make of the share price moves here because this change towards recreational use of marijuana has been obvious now that it was coming. there's nothing in the last month -- do you worry at all about the number of people who are just piling into your shares? >> no, we don't worry. in fact, i think the biggest

difference now is that it's real for people. mentally, emotionally, psychologically. this was a big domino to fall in colorado. so much so that you saw movement by the governor of new york as you were saying earlier to actually mandate the marijuana. that's a first in as you were saying earlier, to actually mandate the marijuana. that's a first in our industry. and in terms of medbox -- >> i was going to say, not that you expect to say we hate the fact that people love our stocks. but going to elon musk who said before, the sharp increases in swings in their share price. and i'm wondering from that point of view, you think of it. >> from a business perspective, not just an increase in medbox. you have to look at where the industry is. because it's so real now and it's so tangible to people, you have to look at the potential growth curve of the entire industry, which could be billions of dollars over the next years and decades. not just nationally but internationally. and in terms of medbox -- >> stay right there. >> right.

>> i just want to bring our panel in on all this discussion. first, finish the thought, doctor, if you would. >> in terms of what people don't understand, what people assume to understand now is, within this industry, there is a tremendous opportunity for large organizations to be, for example, a large franchise. like a mcdonald's. or a large agricultural oce organization, like rgr. and in terms of medbox, medbox has the ability to be all of those companies. >> doctor, i've owned your stock. and unfortunately, i sold it way too quick, which is always what i do. i buy them cheap. but i don't hold on long enough. i do think this is going to be a very big business, especially as it expands across the country because i don't think it's going to be isolated to just a few places. so, how much can you guys meet that demand? we've said the price of pot is going through the roof because of demand.

how about the price of your boxes? >> right. >> well, to understand medbox, you have to understand that we're really just more than -- we're more than just boxes. we're the industry leader in consulting, as well. it's about engaging all of the businesses and engaging not just your growers and your dispensary operators, but government officials and all of these ancillary organizations that feed the industry. that's why we are so substantial and we're so supportive and to be looked at as an industry leader because we have contacts everywhere. that will enable medbox to grow. john, you can always buy back in. >> i will. i intend to. unfortunately, when it jumps from $29 to $42, that kind of leaves me waiting. >> that was today. >> that was today, folks. >> right. >> what will we be tomorrow? >> i like the idea of engaging government officials. what's the worldwide story on marijuana? is it legal in other countries? how do they handle the same story that we're starting just now?

>> is that question to me? >> yes. >> yeah, go ahead. >> the question to me is, yes. people may be aware of uruguay. uruguay has started the complete recreational use of marijuana. they've headed down that path. places in the former soviet union are looking at going down that path, as well. so, it's still not shaped very well. but it's beginning. it's spreading like wildfire, as they say. >> u.s. is a leader then in this arena? >> yes. canada -- >> i'm curious, doctor, in how you finance your business because, as this has become such a booming industry, the banks said we want to participate. we want to provide funding. but unfortunately, with so many states not onboard, they're worried about potential money laundering, potential issue where they're funding businesses that are illegal in some states and not others. it seems like a lot of your competitors have gone public. but they're just trading for a couple cents. pure playpenny stocks.

do you feel pressure to go public? and where do you find the money to actually finance and run your business? >> great question. it's a two-fold answer. first response is medbox is engaged out of santa monica to help us to -- to advise us on capital raising, which we're taking advice, as well. secondarily, what's going to happen now, is that the feds have now a fiduciary duty of government officials, oversight committees, local, state, federal. all these government federals have a fiduciary duty to embrace this industry. instead of putting people in jail, they need to support and create the rules, which i know they're trying to do. >> do you think we'll see a spate of ipos from your competitors? some of the smaller companies that can't raise the capital? >> last word, doctor? >> it will happen. it's all a matter of time. and the leaders, which we

believe medbox is, stands only to gain from these ipos. and from really a ground swell of support from everybody. >> does feel like the wild, wild west. dr. bruce bedrick, thank you so much for being here. we will be watching. appreciate it. >> thank you so much. we asked, you tweeted. our twitter feed is lighting up. that's next. s. saratoga in 1982. [ male announcer ] once it's earned, usaa auto insurance is often handed down from generation to generation. because it offers a superior level of protection. and because usaa's commitment to serve current and former military members and their families is without equal. begin your legacy. get an auto insurance quote. usaa. we know what it means to serve. [ male announcer ] here's a question for you:

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welcome back. marijuana-related stocks are lighting up this market. we wanted to know if you're investing in pot right now. we got a ton of sweets on this. here are some of the standouts. yes, who wouldn't want a high return on investment? i will. like spirit stock and tobacco stocks. can't wait to round out my vice portfolio. i would not invest in the marijuana industry because it most likely will all go up in smoke. hunter tweets, i'm investing all my money in munchies suppliers. there may be something to that, guys. how are you playing this stock? >> because i said medbox got ahead of itself, i bought a competitor. usat instead. and i'll try to get back into medbox in a little bit. >> do you think that investors out there have to be careful about all of the penny stocks? >> don't just go to a website

and look at what they're touting because there's a lot of penny stock touts that go on in all businesses. watch out for that. >> there's a way to play this. >> 2013, one of the best biotech outthere was gwph, the ticker. it was a $9 ipo. it's near $40 right now. it's a $500 million company. but it's a british firm that specializes in taking that kind of drug and making it prescription-based. there's a lot ways to play the cannabis trade. >> i like the munchies trade. domino's pizza. yum brands. >> it seems like this is coming to new york. it sounds like the political winds are changing. >> they're changing. but we'll see. we have to see where it goes altogether. this is a new thing. see how the feds feel about it. >> it's part of the postbloomberg administration. he called it a hoax, the entire industry. >> i think we're postthe hoax.

thank you so much for being here. enjoy the rest of your evening. "fast money" is coming up in a few seconds. melissa lee has the analyst who downgraded apple. >> we read a lot of research notes. this stood out because this was a quote from the research note. i will once and for all speak my mind, even if it ends up destroying my business that i love and that i worked 15 years to build. he mentions taking sleeping pills. he mentions pope francis. this should be a good interview. >> kudos to him. this is an op-ed in the making. "fast money" starts right now. live from the nasdaq markets in new york city's times square, i'm melissa lee. jetblue's chief operating officer will join us in a few minutes. the airline cancels hundreds of flights because of the weather. find out what he has to say. and wireless wars. at&t is trying to lure tmobile's customers with cold, hard cash. we have the ceo from at&t mobility, live