submerges and re-emerges to get all those yachts back and forth. a one way ticket, $250,000 per trip. guys, back to you. >> one way. we're going to look forward for it 9:00 p.m. tonight on cnbc. >> thank you for watching "street signs." we'll be here tomorrow we hope. >> we'll hope and pray. see you then. and welcome to "the closing bell." i'm kelly evans. as we hit 3:00 eastern on the east coast, eastern on the east coast. that's an oxymoron. >> redundant is what it is. >> thank you. we're trying to see if the stock market can get it's footing but we have to be clear what stokt we're talking about. >> i'm bill griffeth. earnings are the culprit dragging the dow later but the other two major averages are trading higher so it does depend which market you're talking about. we'll talk about that in a few

minutes. also we have two huge earnings reports that could dictate the tone for tomorrow. we have netflix and ebay due out in be aab an hour from now. instant reaction from the market coming up on "the closing bell." >> also what is the single biggest mistakes investors make? one of the most successful money managers in a generation tells cnbc exclusively what that mistake is. >> and forget i-robot. instead, think i unemployed. let's not think that. we will have a special report on the ro gres in robotics that has come so far in the past generation. what was the statistic we were reading? in the next what decade was it? robots so replace 70% of the businesses that exist in this world right now. that's incredible. >> it is, but it's hard to actually think about that being

the case. it's an interesting thought, but at the same time you can think about the way robots are augmenting and maybe opening up whole new fields of employment even. >> exactly. but what does that do to the humans? what does it do to productivity? we will take a closer look at that question with the man who wrote the article for "the new yorker" coming up. in the markets right now, the dow by far the underperformer and that's in large part due to ibm. we covered those earnings when they hit on this program yesterday. continues to be down in the range of about 3%. meanwhile, the nasdaq and the s&p 500 are ever so slightly positive. we're literally up just about a point on the s&p. the nasdaq adding 16 at this hour. >> let's talk about today's market action in "the closing bell" exchange. katie stockton from btig keith fitzgerald from money map press, rob morgan from fulcrum securities who got slammed in the snow in philly yesterday. jim kahn from wealth enhancement group and our own rick santelli.

we all have to deal with snow except forfeits gerald. katie stockton, you still see in the near term here upside momentum. you're probably referring to the s&p, right? >> well, th keye key really is to look beyond the s&p. the market has been in a consolidation phase for a couple weeks if not more in some cases and that's why you get the mixed returns on the major indices, but that frustration really hasn't occurred as much overseas. i would encourage people to look beyond the s&p 500 at the european equity benchmarks many of which broke out from consolidation phases to new multiyear highs. in some of the emerging markets we're getting some nice oversold markets. look at the philippines and china, for example. we're seeing some nice action overseas and i think that bodes well for momentum catching on again here in the u.s. >> jim, it's interesting but steveste

i stefil points out if we rally it will be the tenth time so far. we've only sold off four times. there seems to be an upward bys a bias in the second half of the trading day. >> it's hard to tell what's going on with the diurnal patterns. portugal italy, et cetera they look a lot better. i think that's taking a lot of risk off the table for u.s. markets. so i think that gives a little relief to people saying i have a lot of cash on the sidelines let's put it in the u.s. markets. >> rob morgan we're all watching these earnings as they come out. i know you're overweight technology, but it's been some of the high profile technology companies that have not so much disappointed but the market response has shown disappointment.

i think of an ibm, an intel and some of the others out there. what do you make of that and do we discern a trend from just a few of these earnings reports so far? >> well it is disappointing, bill, some of the technology earnings we've seen but really my overweight is based more on capital spending on technology looking down the road. it seems we're at a tipping point with corporate ceos from an employment standpoint where i feel like hiring is going to continue to pick up as we go through the year and with that i.t. spending should continue to pick up, and i think that bodes well for the ibms and intels of the world that have disappointed here. the sector is attractively priced in general and even though right now from a technical standpoint it's not exactly knocking the cover off the ball i think just valuation will continue to bring some dollars into technology from an investment standpoint as we go through the year. >> if they keep doing that they

will be replaced by robots. >> i was going to say to some extent, rob, it seems that money is dead money, it's trapped. could you argue that especially some of these big old tech companies, they themselves are the ones now acknowledging that the cloud disruption is something that's completely transforming their business models, they're struggling to catch up. why would you want to put money to work in that sector? >> you make a good point, but you look at microsoft, for instance which seems to be tethered to the dying pc. they really started to make more moves into the cloud and into mobile, and i think as we go through the year, a lot of these big giants that have really laid out a plan to transform themselves, i think the media will start to pick up on that more as we continue through the year. >> keith fitzgerald probably should have come to you after katie stockton. she sees this near term momentum higher. you're kind of taking this wait and see attitude. just in case. you're raising your stops, you're selling some of the

strength right now. you're still thinking that maybe, just possibly we're going to finally get that 10% correction right? >> i am. i'm very cautious in here and there's two data points that cause me concern. one, we're 400-something days since we had a 10% correction, and, two, household assets put into stocks is about 30%. that's preceding a revaerserseal by about 12 months on average. i am looking to parts of technology, still looking to energy because i think the fundamentals never go out of style and they remain compelling. >> you're one of the few that likes energy. why do you like energy? >> well look this is basic math. you have the world becoming a more complicated place. we're using more energy. even if we find a perfect substitute for oil, it will take the most aggressive scientist 30 years to convert more than 50,000 discrete industrial processes to an alternative.

lodge km logically you have to own it and you have to be in it. >> you can't ignore the role the dollar plays in all of this. i wonder if strong dollar is starting to look like a theme of 2014 because of what's happening in some countries like britain. >> you know i think whether you look at foreign exchange among the developed and mostly developed economies or you look at interest rates, you can garner less and less information. it's more about flows and arbitrage and relative value. to your point specifically the war between central banks and the markets trying to push back. so case in point, if we look at what happened in the uk. their unemployment rate dropped to 7.1%. all of a sudden, the pound starts to do better and we understand why. this is a market saying listen guys central banks needs to ease off a bit. same dynamic as the markets challenging the taper with the flattening curve. look to australia.

what happened? a 2.7 year-over-year cpi. they were a bit astonished. market jumps to the notion the next move will be a tightening. there's an important lesson here and that is that whether it's in the u.s. or anyplace around the globe, the markets at some point and investors look to the old ways to try to divine what's going on with the information measuring the economy and what's going on with central banking and this tug of war will go on for a while and be a central theme for 2014. >> based on what we heard in davos today, abe nomnomics is very much alive. they will continue to support the japanese economy and presumably push that yen even lower at this point. >> i rather when sammy sosa and all the juice boys were hitting home runs. rocket was juiced throwing

110-mile-an-hour fastballs. if you were betting on baseball you had to go with it even though you knew at some point the juicing would stop. all our guests will tell you how to make money in the game. >> and like that era in baseball, you get a big asterisk next to it. >> exactly. it's going to be all about talking abouts a terasterisks. >> i can't wait for those pictures. if this backdrop of surprising to the upside in britain, in australia, if there's a theme there that points toward global strength, why is it that some of the material names with alcoa rebounding lately as well why don't you like the materials sector more here? >> well kelly, a lot of it is from a valuation standpoint. i think the stocks are still fairly expensive and, you know, the dollar is going to continue to strengthen too. bill was alluding to that earlier, and even though those companies are multinationals and

they do well overseas from expanding economies when the dollar goes up they tend to struggle. so it's valuation and the dollar. earnings visibility isn't that greatest either. >> folks, time is up. pencils down. thanks for joining us. we appreciate it. >> great to see you. >> thanks bill. we had news that ponzi schemer bernie madoff apparently suffered a heart attack recently. >> scott cohen, this apparently happened last month but we're just learning of it now? >> let's preface this first of all by saying we are well aware there are plenty of people including most of his victims that could not care less about his health. the timing of all this is a little bit fuzzy in part because the bureau of prisons refuses to comment. i had heard from madoff in early december around the fifth anniversary of arrest. then nothing until a few days ago when he e-mailed to say he was sorry he'd been out of touch, that he'd been in the duke university medical center after suffering from a heart attack and kidney disease problems. took us a couple more days to

clarify that. the bureau of prisons website says he's back at the medium security facility in north carolina where he's a little less than five years into his 150 year sentence. in his latest e-mail he says in addition to his heart problems, he has stage 4 kidney disease. that is a step away from kidney failure but we understand madoff is not undergoing dialysis. bernie madoff is 75 years old. guys? >> is he on our list of 25 most influential? >> i don't know. we have a list of 200 people on our website right now. go to cnbc.com because for our 25th anniversary, we are putting this list together to try and determine who the 25 most influential people have been in the last 25 years. >> it included some notorious names. >> i don't know. i guess -- i'd put him on there, right? >> depends how you look at it. >> well of course. we've got 50 minutes left in the trading session here. the dow -- the dow is down 32

points but that once again, like yesterday, doesn't tell the whole story. the nasdaq is up 18 points and the s&p is also trading higher as well. starbucks will be turning out earnings tomorrow and here is a question for you. if the coffee chain is benefiting from foot traffic from shoppers will its bottom line take a hit as more people shift online? we're awaiting the earnings from netflix and ebay both due shortly after the top of the hour. we'll get to those numbers. the instant analysis the market reaction, all that we do so well right here on "the closing bell." and we know robots are no longer science fiction. the reality may be they're taking away your job one day. we'll look into the future and find out what us humans will be left doing. keep it right here. you're watching cnbc, first in business worldwide.

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it's been that kind of year. nary thomp mary thompson is here with some of the stocks making noise. >> we begin with apple. it's moving higher on the news that carl icahn bought $500 million worth of its stock over the past two weeks increasing his stake to over $3 billion. icahn did lash out at the company for its refusal to increase its stock buyback program. anadarko patroletroleum and bp gaining after big blue beat on the bottom line but recorded a revenue miss for the fourth consecutive quarter. a tough day for advanced microdevices. they forecast a drop in current quarter revenue. we end with starbucks. the company is scheduled to report first quarter results after the bell tomorrow. analysts are looking for a gain of 69 cents on revenue of $4.29

billion. starbucks up just about a half a point or half a percent ahead of that. back to you, kelly. >> speaking of which with starbucks set to report earnings in 24 hours, was this memo to howard schultz to employees two weeks ago a red flag for the quarter? take a look. he wrote, national data will show that increases in online shopping this holiday far outpaced increases in traditional in-store shopping. starbucks was not immune. he goes on to emphasize that they still have mobile payments which benefit, but that was an interesting point for him to cite. >> he's always needling his employees. let's think about this let's worry about that. that's his job and he does a pretty good job of it. let's talk about it with jason moeser and brian sazi. so, tomorrow guys is report card time. brian, what are you expecting from starbucks? >> i'm expecting an in-line quarter from starbucks but more importantly everything in starbucks went absolutely right into 2013. they drove multiple expansion through a lot of intrigue.

they spread that intrigue from the investors across their social media feeds. so everything worked right, but what i'm worried about is what you mentioned in the lead-in with howard schultz. when he tells me there's a fundamental change in how their business is operating,s this this is -- this is not a man collecting checks. >> jason, at the same time starbucks is one of those chains that doesn't just have locations in shopping malls and shopping centers, there seems to be a starbucks in every neighborhood a lot of them as part of the highway, a lot of drive-throughs. there's locations that may have nothing to do with how same-store sales are trending. how important might that be for this company during the quarter? >> well i think it's a very important thing that howard schultz is communicating with his employees about how sort of the business is changing. how technology and the internet is taking starbucks in new directions. what you have to appreciate about starbucks is we've recommended starbucks for our

members since 2006 and it's fundamentally a different company even since then. they're delivering their product through many different ways now whether it's in the stores and the malls, the standalone stores in the channel development department there and all the grocery stores. they're offering subscriptions online. you can have your coffee mailed to you. i think when off forward-looking ceo like howard schultz is that's definitely an asset for a company like this that's really trying to embrace technology the mobile platform and really go to where the consumers are. >> but, jason, to kelly's point to some degree howard schultz used to make the argument -- he doesn't make it anymore. he used to make the argument that their supply would create their own demand. in other words he'd set up a shop anywhere and customers would come. at some point that has caught up with the company, don't you agree, and they will be subject to the laws of big numbers, if not already, don't you think? >> no question. the basic laws of economics are coming into play here. i think that's why you see starbucks becoming more things to more people. it's not just a coffee company

anymore. it's evolution fresh, teavana. they're trying to integrate the new aspects of the business into the model. it's not going to be something that happens overnight and there will be mistakes but we recently interviewed cfo troy alsteady here and he was up front in telling us food would be a primary driver for in-store. the good thing for us is typically we like to buy low and sell high but we don't do a lot of selling. we're net buyers of stock. when we see starbucks announcing like this any short-term reactions to the downside we present thotse as buying opportunities. we see starbucks as a long-term holding. >> starbucks hasn't been standing still. they have done a lot in terms of just becoming that place that you go almost to do whether it's

to pick up a snack, just to meet friends. it serves a lot of purposes other than just being a complimentary thing in a shopping mall to your shopping he can kurtion excursion. will that curb their exposure to some of the declining foot traffic trends? >> it's going to hurt starbucks. yes, it's a high class problem. but i encourage everybody, we did an exclusive on cnbc.com last week where we went in undercover in starbucks for the past two months. what we're seeing longer lines. when you have longer lines because the employees are being tasked with doing more things you're discouraging a sale. we actually videotaped people leaving the stores. i call it mcdonald's syndrome where the company is pushing for growth so much they're losing sales, and that is a fundamental change in the business that is not reflected in the stock. what's also -- >> but that's precisely the kind of thing howard schultz worries about, don't you think? it's not going to be lost on him. >> you're right. it's a high class problem to have but it's not reflected in

the stock because we're starting to see out of stocks. if you look on the videotapes in the exclusive piece, you can see people leaving the store, and by no means -- the street is already expecting earnings well above the company's guidance. they're looking for people to buy drinks and food. i don't see that attach rate on the food yet. >> it's fascinating. the shares still moving higher today. we'll see what happens in just about 24 hours' time. brian and jason, thank you both. >> good to see you, guys. >> food is the future for them. just don't change the buttermilk doughnuts. >> do you like the buttermilk doughnuts? >> i love the buttermilk doughnuts. >> now we know. we have about 40 minutes left to go before the close. the dow is still negative by about 25 points weighed down by ibm in particular. the s&p is positive. the nasdaq adding 20 points. >> we're still learning a lot of stuff about each other. in the remake of the upcoming sci-fi film "robo cop" a machine takes over a man. that may be a movie, but in real life machines may be taking over a lot more jobs than humans do. when we come back why robots

may one day be waiting your table in a restaurant. and today is part of cnbc's 25th anniversary celebration. a look at how you can vote on narrowing down 200 legends to just the top 25 who have influenced the world the most. two contenders lead the list bill gates and steve jobs. if you could only pick one to make the top 25 which one would you pick and why? >> that's a tough one. >> tweet us @cnbcclosingbell. your thoughts later on.

welcome back. if you ever thought sky net from the terminator movies could one day be real life with robots taking over society, brace yourself for our next story. phil lebeau is in connecticut where he's witnessing firsthand a rise of the machines and, phil, should we be afraid? >> i don't think you should be afraid. this is baxter right here. he's assisting in taking plastic cups that are going to be going to a package company, he will take them off the assembly line. he's got two arms here and as he takes them off the assembly line, he will bring them over here and they will get bagged. this machine, this robot, is part of a huge trend we're noticing when it comes to the change in jobs and robots in manufacturing. in fact, take a look at this chart. the change has been dramatic over the last 15 years. look at the drop in u.s. manufacturing jobs as we've seen more robots being put into industrial production. the folks at vanguard plastics

have had baxter since november and they say he's made a huge difference in terms of productivity. >> it's doing a repetitive job where the other person can be doing a new job and keep the business going. in this business you don't have new projects you're not going to be around long because it rotates so much throughout the year. like we've lost to china $1.5 million, $2 million. it mexico we've lost $3 million. so we've had to replace all that work and this is what helps us do it. when you get a new customer in and they see you have something like this that helps out quite a bit. >> vanguard plastics says it's all about increasing productivity and efficiency. in fact, they're hiring two more workers because baxter has allowed them to free up manpower. the people who make baxter rethink robotics say this is all

about increasing productivity and adding jobs. >> we think of baxter as a workforce multiplier. baxter paired up with american workers means the overall output or the productivity of that factory goes up because the people are doing the interesting value-added work. >> rethink robot ticks says there are a couple hundred baxters around the country in universities and manufacturing plants and you will see more of these guys in the future. it truly is changing how plants operate around the country. >> phil it's fascinating. stay with us if you would, for a moment. we want people to imagine this scenario in the future. someone who works in an unemployment office gets laid off and a robot replaces their position. when they apply to unemployment they have to give their paperwork to the robot that took their spot. >> ouch. that irony could be one day a reality. what will humans do for work when robots are doing most of the work? joining us gary marcus is a

cognitive scientist and expert on artificial intelligence. he's a professor of psychology at nyu, and he wrote a recent piece about robots in "new yorker" magazine. gary, welcome. i have been hear being this replacement of humans by robots my entire life going back to the early days of ib mm and univac. is it still a pipe dream or are we really at the tipping point where it will start to happen in a big way? >> i think we are at a tipping point. could you start thinking about taxi drivers and where they will be 20 years from now. google has driverless cars that are legal in three states. they're not commercial yet but eventually they will be. as driverless cars become commercial products, taxi drives will have to look for a new line of work. the question is where weather they will be scalable jobs and businesses that have jobs for lots of people or whether they're going to be new businesses that have jobs for one or two people. >> dr. marcus it's true though that if you, as bill was saying

three, four decades ago had bet against the american workforce despite the problems that we're facing as a whole employment has continued to increase and it seems like some of the things that are changing with regard to employment has less to do with the kind of jobs that are being replaced and more, i guess, with just the kind of unemployed that are trying to say, transition from working in construction after the collapse of that industry towards something else. so how do you describe the areas where we're really seeing losses and what kind of losses to this robotics movement? >> well, i think the first places where we're going to lose jobs to robots are going to be drivers. i think driverless cars are definitely -- they're not just on the drawing board. they're real. i think that fast food workers are going to lose their jobs eventually because places like mcdonald's are putting a lot of money into replacing their workers at least in part with automated machines. there are some industry that is

for now are pretty safe like nursing, but if you look 30 years out, that's where a lot of the robotics companies are going are home health aides and things like that. if you look 50 years out, my job as a professor might be on its way out. as you look over the next century and i think more and more occupations are going to be replaced by robots and artificial intelligence more generally -- thank heaven they can't replace television news anchors. phil, the industry -- >> not yet. >> -- you have covered, you have seen robotics play a bigger and bigger role in the assembly of cars and airplanes, but they haven't completely replaced the humans at the same time have they? >> i don't think they will ever completely replace humans -- >> i'm sorry, dr. marcus. go ahead, phil. >> when you talk with the manufacturing experts who run these corporations, the folks who are really looking into how things are put together not higher up what they all say is the same thing, it's about having the people on the ground who understand how to use

robots. robots don't do any good unless you program them. one more point to what dr. marcus is saying. i understand what he's say being autonomous driven cars. yes, that technology is here but we're a long way from seeing it. you know why? regulators will be really cautious about the idea of not having somebody behind the wheel. automakers don't see that happening anytime soon. >> although a lot of the technology has effectively taken that control away from the driver and put it into the hands of man ri. >> machinery. >> but government and the role they will play in overseeing this transition to the greater role of technology in our society, what about that? does that slow it down 1234. >> i think it's going to depend on the industry. in driverless cars i think it might be in the government's interest to put those on the roads sooner because they save lice or will save lives. they're not there yet but within 20 years i think it's likely

we'll have driverless cars because they don't space out or drive drunk. they are going to be safer. in that industry is might be better for the cars to replace us in terms of lost lives. we also need a global policy that says hey, if you're building a new business is it one that's going to make two employees as you scale up or 100,000 employees. the government might want to help those industry that is can make more employees, give them some kind of tax credit or something like that to look at the big picture. >> phil, i have to ask, why did they give baxter eyes? why not just -- >> kind of creepy. >> why does it have to look like a human? >> i know it's creepy but these eyes actually serve a purpose. when he turns around there's a camera up here and you can actually touch baxter. it's not like you can't go over and touch him. i'm touching him right now. if you do the wrong thing, they will make a look of confusion. it immediately tells you, okay you're not doing the right thing -- >> feedback. >> they do serve a purpose.

it's not just there is you can say, oh look, there's a face on the robot. they do serve a purpose. >> all right. slightly less creepy in that case. it's fascinating stuff. >> gary marcus good to see you. thank you. enjoyed the article. appreciate it. >> thank you. and a human just came by and told us that the market on close orders are more to the sell side right now not by a whole lot. >> you can never replace cashin. >> art cashin is irreplaceable. down 27 points on the dow, even though the nasdaq and the s&p are trading higher. ebay revolution azized shopping. it may be revolutionizing the way you pay for shopping. and netflix earnings are due out in a half hour but the real number might be the movie subscriber number. we'll look at the impact that number could have on earnings coming up. stay tuned.

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the recent past. companies are now sitting on $7 trillion in cash. that's double the amount they had back in 2003. >> i could not believe. we have been quoting $4 trillion all these years. now it's up to $7 trillion. apple one of the most notorious cash hoarders. they alone have $147 billion in cash right now. in fact billionaire investor carl icahn is doing his darnedest to free up that money. he bought more shares of apple, he announced, and then tweeted this morning that apple's board is quote, doing great disservice to shareholders by not having markedly increased its beyback.uyback. with so many companies with so much cash is it only a matter of time before they start using that cash and will that be a boost to the economy and to the markets? we've been hearing this argument forever. joining us to talk about it paul hickey and our own bob

pisani. paul do you have any sense of why they're hoarding that much sense? should we be worried or what's going on here? >> when you think about it at first, it's some of the largest companies. a lot of that cash is concentrated there. you have six companies in the u.s. accounting for 25% of all the cash for s&p 500 companies. so that's one thing. the cash has been going up and one of the reasons was we had a -- we're coming out of a very big recession, and as the economy shifts from a recovery mode to an outright expansion as it is starting to do and we saw the signs of in 2013, you're going to see more activist investors pressuring companies to either invest that money or return it to shoed ersareholders. >> if the old joke is you rob the bank because that's where the money is corporate america is now where the money is. >> it's true there are pension obligations out there, but it's a fraction of the money. you talked about $7 trillion. i just made a phone call. it's $450 billion in unfunded

pension obligations that are out there. that's a fraction of the cash that these companies have on hand. and remember something guys. as the interest rates go up these pension funds become better funded and that's what's going to happen this year. if you look at some of the company comments i saw caterpillar, honeywell, they all mention their pension fund obligations were going down because the value is going up. >> what's it really about? what is this cash pile really about? is it just about tax law and we should mention this isn't just u.s. companies. >> that's global. >> or does it reflect still some lack of investment opportunity or willingness on their part? >> i mean i think it's both of those, at least in the u.s. tacks play a part in it but it's so easy for us to come on and say these companies have to invest more, they have to invest more, but if you look at say, capacity utilization in the united states, even after this recession, we're four years into this growing economy now, capacity ut lieilization is still

below the average. to invest just for the sake of invest something probably more irresponsible than just hoarding the cash. >> exactly. a lot of those ceos are probably saying show me the demand first. who wants to be the one that makes that first move to green light a new factory or a new product or a new campaign for something and it doesn't work? bob pisani you get your head handed to you. >> but it's getting better. capacity utilization has been going up for a wlil. the last number was 78%. slowly things are definitely getting better. that cash hoard, my point is is not going to be spent on pension funds. it's getting better because of interest rates going up. i'm just waiting for the day that one day we will see news on the front page that the job market is improving and everybody will decide it's time to do some veferg and capital expenditures will go up. >> be careful what you wish for. if you have all these companies returning their excess cash most of these are tech companies, and you're going to

see a lot more volatility. you could make the argument that apple would be a lot more volatile stock right now if it didn't have all that cash on hand. since it's the largest company in the s&p 500 that would make the markets more volatile than they are today. >> they should have that problem. >> yeah right. paul, always good to see you. thank you for joining us. bob, we'll see you around. >> someone who has strong opinions jamie dimon, the chairman and ceo of jpmorgan will be on "squawk box" tomorrow morning. the team is live in davos for the world economic forum and that coverage will begin at 6:00 a.m. eastern. >> i'm sure they're all three loving staying -- getting up later in the day so they could host their show at noon. >> so different. absolutely. i think joe was saying he gets to stay out a little later as well. >> oh, boy. that's not a good thing. heading to the close. 15 minutes left in the trading session. the dow is still down just a bit, down 33 points. dragged lower once again by one of the big components this time ibm. the bitcoin buzz has made

its way to ebay. what the e retail swap shop has in mind. after the bell as part of cnbc's 25th anniversary celebration, you can vote to narrow down the top 200 legends to the top 25. two contenders bill gates and steve jobs. if you could only pick one, one of these guys to make the top 25, which one and why? tweet us @cnbcclosingbell. we'll be back after a quick break.

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welcome back. some breaking news on detroit's bankruptcy proceedings. scott cohn, what do you have for us? >> this is potentially a very important development in this historic bankruptcy case. michigan's governor rick snyder has unveiled a $350 million what he calls a settlement that would possibly do away with a lot of the issues in this bankruptcy case and really move it forward. this would be on top of more

than $300 million that's already been pledged by a number of foundations, and all of this designed to go to the retirees who otherwise would face severe cuts to their pensions. the governor says this is a settlement, not a bail out. it would still require legislative approval but a lot of parties in the case have been waiting for the state to step up. the state still has some $3.5 billion in unfunded pension obligations obligations, but this would go a long way toward it, still requiring legislative approval. a lot of forces on either side suggesting some conditions attached to this money including the governor says ind penependent management of the pension funds. we're continuing to follow it. governor rick snyder still speaking in michigan. we'll keep you posted. >> scott, thanks very much. that is potentially very important there. first it was some small businesses that started to accept bitcoin, then a realtor in manhattan here. now two las vegas casinos are taking it along with overstock.com which is the first

major retailer to accept bitcoin. >> and is ebay preparing to be the next biggie to join the bitcoin party? josh lipton has all the details out of san jose. >> bitcoin we know is attracting a lot of publicity. in order to win over the mainstream, the virtual currency needs to get accepted by ecommerce giants like ebay and amazon. the problem is one is open to the idea the other is not. remember, the currency isn't guaranteed by any government and critics worry about its safety and security. what happens, for example, if your bitcoin wallet is hacked? how do merchants deal with the wild swings in the currency? despite the concerns sources at ebay tell cnbc that the company is now actively investigating how to integrate the currency into its business. ebay isn't allowing bitcoins to be used as payment for products. that could change sources tell cnbc, when the regulatory

framework is clear. david marcus the president of pay pal has talked about how he owns bitcoins and even tweeted pay pal is a bitcoin believer. it's a different story at amazon. the company tells cnbc that the retailer does not accept bitcoin and has no plans to do so. but if bitcoin bulls are right and more consumers see it as a legitimate payment option ecommerce giants could be forced to embrace it. at the close i will have more for you about ebay when the company reports results. the street expecting 80 cents on sales of $4.6 billion which would mean a 14% jump on the top line. back to you. >> netflix reports its fourth quarter results coming up after the bell as well. >> if there's one set of numbers that could have a huge impact it's the streaming services future. a general earnings preview with julia boorstin. >> the number most in focus for

netflix is u.s. streaming subscribers, a key indicator of how well netflix's investments are paying offer. analysts projects netflix will end the quarter with over 33 million domestic streaming subscribers. 2 million more than last quarter. they also anticipate the company will forecast the addition of another 2 million u.s. streaming subscribers in the coming quarter. earnings per share are expected to grow by more than 400% to 66 cents per share while revenue is projected to grow 23% to $1.17 billion. on the earnings call which is an unusual question and answer question hosted by two analysts on youtube, we can expect questions about international expansion, margins, and whether netflix plans to change its pricing model. the numbers should be out right at the top of the hour and i'll be back with them then. bill, over to you. >> julia, thank you very much. we're heading towards the close, about ten minutes left in the trading session here. the dow is still down 26, but

again it's the dow that's the laggard today. the nasdaq and the s&p are still trading higher. blame ibm. it's down. >> that's right. the s&p only five points off its all-time closing high. after the bell norfolk southern ceo is here to talk earnings and the economy. it's another exclusive interview you don't want to miss and that's just ahead. i'm beth... and i'm michelle. and we own the paper cottage. it's a stationery and gifts store. anything we purchase for the paper cottage goes on our ink card. so you can manage your business expenses and access them online instantly with the game changing app from ink. we didn't get into business to spend time managing receipts that's why we have ink. we like being in business because we like being creative we like interacting with people. so you have time to focus on the things you love. ink from chase. so you can.

coming up on the five-minute mark. the dow still down 29 points. the nasdaq and s&p trading higher. ibm dragging the dow lower after its earnings. we'll get ebay and netflix coming up. we just keep slogging along. are you inclined to want to keep buying at this point or do you step back and wait for that infamous correction we've been waiting for? >> we'd like to see some kind of correction but you don't always get what you want. >> exactly. >> there are no perfect market timers. new money comes in we put some to work here. >> where do you put it to work right now? >> we're a full asset allocator, so we put a little bit of bonds, but our favorite asset class is still equities and we like large cap multinational high dividend paying blue chip.

>> safety really right? are you betting on growth as well though? >> yes. we think corporate earnings will grow 6% 7% this year. maybe we get lucky and get an expansion of the price earnings multiple. very acceptable. especially relative to bonds. >> got it. todd, good to see you. wish we had more time but we have braegeeaking news and the closing bell as well. back with a countdown and then after the bell, it's not everyday you hear the head of the world's biggest hedge funds talk about the worst mistake investors can make. you will hear that though and find out how to avoid making those mistakes coming up. stay with us. this is cnbc, first in business worldwide.

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>> all right. he's hanging onto that bull torch. i like that. thanks very much. see you later. that will do it for first hour. stay tuned. earnings from ebay and netflix. see you tomorrow kelly. >> thank you bill. welcome to "the closing bell." i'm kelly evans, and the dow once again lagging the overall market and as today's numbers settle, all eyes on a pair of earnings due any moment that could drive the day tomorrow. netflix is expected out any minute now. we'll break down the results the second they come in. ebay is expected to report. here is how we're finishing the day on wall street. the red arrow on the dow. shedding 38 points. almost all of that is ibm. big blue down hard. the nasdaq up 17 points. the s&p adding just about a point eking out a small positive. let's get straight to it now

with today's panel. joining me now, lee gallagher from "fortune" magazine mandy drury, stephanie link nathan bachrach and "fast money" contributor dr. j. the netflix earnings hit before i could even get into that. let's get to julia boorstin in this case who is size them up for us. julia? >> kelly, netflix earnings are out and the numbers are better than expected. key subscriber coming in at 2.33 met additioning. the international streaming subscriber also better than wall street had expected at 1.74 million. the company had 1.$1.75 billion in revenue. looking at earnings per share, the company reported 79 cents in earnings per share.

that far exceeds expectations of 66 cents in earnings per share and is up from 13 cents in earnings per share in the year ago quarter. so kelly, looks much stronger across the board both domestic and international, and i see the stocks spiking on these numbers. >> absolutely. julia, i mean wow, for a company that -- it's always a little bit of a gamble as far as investors are concerned which way did it go. a decisively positive quarter it seems from this early read. the shares up 13%, better than 14% after hours heading back towards that 52-week high of $389. let's get some instant reaction from edward williams. what do you make of it ed? >> it's a great addition exceeding our expectations and i think that's a great leading indicator on a going forward basis. >> people have said as well once they added 30 million u.s. domestic subscribers, could they ever -- could that continue?

you're talking about a company now that's overtaken hbo, for example. do you think this changes the thesis when it comes to just how much penetration there may be for a company like netflix in the u.s.? >> i think it shows with the connected tvs that they have a great product and they have an ability to keep things going certainly through the holidays. i think at this stage one of the key things is going to be looking to calendar 14 and how do you do comparing against that strong number that she showed for '13. the key takeaway is it's a great product, great service. the infiltration of connected devices is encouraging for them. they're off to a good start. >> all right. we're going to leave it there and get over to julia who has been looking through the report which has a little more detail. julia, what more can you tell us? >> well, kelly, speaking of that forecast for 2014 the company used to provide a range of projections for what they would see in the next quarter. now it looks like they're just giving a single number and for net additions for that u.s.

streaming subscriber number they project an addition of 2.25 million which is higher than wall street had expected. they expect to end the end of the first quarter with 35.67 million u.s. subscribers and 12.53 million international subscribe subscribers. so the forward outlook is strong and they're projecting 78 cents in earnings per share in the first quarter of 2014. so strong outlook and one interesting note i just want to point out here from the letter to shareholders from reed hastings is on net neutrality there have been concerns that the recent ruling would hurt netflix, and he says here that it is unlikely that the isps that the internet service providers would discriminate against them and it sounds here like they're pretty confident that -- they said in the long term we think they're best served by net neutrality but they think they're not really concerned about net neutrality issues hurting them in the near term. that should be a relief for investors. >> they're one of the first names people think about as that

continues to work through washington. julia, thanks so much. 35.67 million. stephanie link we're talking about a company where we weren't even sure 30 million was achievable a couple months ago. what does this tell you? >> quite, quite amazing. what's impressive is it's across the board beat. it's subscribers, it's revenues it's earnings and it also implies margins are better than expected, right? and i haven't seen the numbers yet but that's what i'm digesting. and that means that all the concerns that everyone has about the expensive content costs are really just not something to worry about at this juncture and that international is starting to pay dividends. they've been investing for the last several years and you're starting to see the results. so stock actually it was down 13% from its highs. just right back up. obviously this is a perfect quarter. >> i think stephanie makes an excellent point about the international investments starting to pay dividends. i think it's important that came in strong. there have been some concerns out there about domestic saturation being a growing

concern, right? and so there are a number of significant competitors out there to netflix as well. if they can continue to grow the u.s. business and the international business i think that's pretty encouraging. >> dr. j, this was a stock i think people didn't expect to move much after market did they? >> well they were pricing in about a 10% move -- >> never mind. all right. >> it's well through that though. >> that's true. >> people that had been selling the straddle the combination of the sell and put, they're chasing it here. that could be all the more fuel to the fire and everybody talks about competition to these guys but, again, unless you have the numbers of subscribers that netflix has, it's really tough to be a serious competitor because who are the content providers that are going to discount something to you since netflix obviously is able to draw from such a large -- >> has the scale. this is what's so interesting because when you're starting up you might have to invest to the extent that you can build that model out and then use that to

kind of quickly get up to scale. what we're learn something they're getting there and that should make it easier for them to negotiate these contract. they have their own content as well. >> they have some competition, amazon hulu everyone wants to get into the original content game, that is key, but obviously this is a company that had a buffo year last year and continues to impress. can that momentum continue is the big question. one thing this company has done there's been talk it might be experimenting with pricing and, you know, introducing a lower price model that would open the floodgates to more subscribers. you wouldn't think $4 makes a difference, but it does. >> nathan? >> one thing might ruin the party. i hate to burst the bubble and i like netflix in the short to midrange. when you have an announcement that says and by the way, don't worry about net neutrality, let me get this straight. we have a pipeline called the broadband or the internet and

30% of it at night when i watch "scandal" is being used by them and they don't pay for it. somebody is going to figure this out. it's going to cost the consumer more or it's going to cost netflix more. somebody has to pay because somebody is benefiting. >> talking about the original content, i believe the second season of "house of cards" will be coming out on valentine's day, february 14th and there is a worry that maybe it won't be as much of a subscriber driver as it was say in the first season. i don't know whether anyone has heard anything about the predictions for that. do you know? >> there's no way it can be. it's lapping itself now. yes, you might have some more people who come in buzz and all that, but i don't think there's any way it can repeat what it did. however, what the company is not seeing is one risk that people would sign up, binge watch, and then cancel their subscription. they're not seeing that. >> this is a soda company all over again. they're going to get the machines out there, then sprite then you name it fresca. then they're going to start to become a media company and a

channel. right now i think they're just in the distribution getting subscribers, then they'll figure out how many things they can sell them. >> stephanie, any kind of knock on plays here that come to mind? >> the thing is if this is the best in the house -- this is the best company in the neighborhood why futz around with some of the other companies? so far during earnings season this could be the very best print we've seen so far quarter to date. we still have 75% of the companies yet to report but this is a really good one. if you look at the valuation, it's trading at 38 times forward estimates. that's the below the ten-year average of 48 times. maybe it's not growing as fast as it once was, but this is still very impressive growth and i think it's definitely got the momentum. so i think you want to stick with it. >> same question to you, dr. j. any knock on trades come to mind? >> i have spoken to a lot of the cable companies that are always rumored to be getting into the business against them.

and every one of them tells me kelly, that they can't even fathom the burn rate that it would take to catch them now. in other words, to spend and lose perhaps hundreds of millions of dollars per quarter trying to stay in the game with netflix, none of them are willing to do it. i don't know who is going to step up to do it. you could binge watch on these guys and then go some place else, but you're not going to go to a competitor. you're just basically going to go to a tv site and watch some tv shows. you're not going to get anybody else that has this much content for this price. >> great point. thank you, guys so much. fascinating discussion. you can be sure to catch much more. john najarian on "fast money" at 5:00 p.m. everyone else stays with me. ebay is out with results any minute. we'll bring you all the numbers the second they hit along with instant analysis. check out shares of norfolk southern in the meantime. the railroad's earnings hitting it out of the park on both the top and bottom lines this

morning. up almost 5% today and the company's ceo talks earnings and his jute look for the economy in a first on cnbc interview. that's also ahead. you're watching cnbc first in business worldwide.

welcome back. so much to bring you up to speed on. we just had earnings from netflix. they were extremely strong. ebay, we are watching because their earnings are due out any minute. analysts are looking for earnings of about 80 cents a share, revenue of $4.55 billion. want to set this up a little bit. along with david garrity from gva research as we wait for the numbers to hit. david, what's the first number you will look for? >> kelly, the big number i'm looking at is i'm going to see what pay pal revenue growth was during the fourth quarter. basically our numbers are looking at them being up 21% or $1.8 billion. pay pal to our view is the growth driver. on the retail name they have set themselves up as being the omni channel retailers ecommerce partner. obviously in the face of the competition from amazon that business strategy isn't necessarily executing as well as one might hope. >> lee, as we see more people shifting to online purchases, it doesn't hurt to be the conduit for a lot of those purchases.

>> online payment is a huge growth area. there's competition from the likes of square and groupon. this is an area to keep an eye on. will that competition impact margins is a big question. >> and whether or not it can fire up the stock because if you're an investor in ebay you're probably pretty disappointed after a lackluster 2013. i think it will be really key as to what is going to be a driver of the shares. >> you're so right, mandy. it's been invedcredibley volatile within a range. i want to go straight to david faber as the earnings hit the tape. david, what do you have? >> we have the numbers from ebay but as importantly within the release we can also tell you that carl icahn is yet again having another company in his targets. this time it is ebay. even with a small economic interest mr. icahn ebay tells us he indicated -- or has nominated two directors to the board at ebay and has also

submitted a nonbinding proposal for the company to split its pay pal business from its marketplace business. 0.82% position roughly 10 million shares. let's call it a half a billion dollar position. only one-sixth of the position we know he has in apple with his tweets earlier today and his appearance on "fast money" halftime yet he has nominated two directors to ebay's board and he is pursuing a shareholder proposal nonbinding to separate the company into its pay pal business or spin that business off i should say and be basically the marketplace business along with gsi commerce, an important platform it also has. for its part ebay in the release goes on to say it welcomed the opportunity to listen to the perspective of all its shareholders, including mr. icahn. his board nominations will be passed on to the nominating committee. regarding the separation

proposal ebay says it routinely assesses the company's strategic direction as explored in depth a spin off or spriggs separation of pay pal and has concluded the company and shareholder are best served by the strategic direction and does not believe breaking up the company is the best way to maximize shareholder value. they believe it is to leverage pay pal with the commerce platform and relationship with retailers, brands around large merchants worldwide. >> wow. >> carl icahn competing on the ebay front. as i have reported although he wouldn't commit to today with scott wapner he's also got a position in hertz and may decide to move ahead there. we also know of course when it comes to apple, he has a shareholder proposal again nonbinding, to have them undertake a $50 billion buyback that would conclude with the fiscal year.

>> this is incredible. we saw the shares immediately pop on news of the earnings. as you're detailing this proposal and is it a different -- du get a sense this is different from his more an antagonistic relationship with apple? let me ask david garrity about this. what do you make of carl icahn's involvement here? >> well carl icahn if you were to have the same position in ebay he has in apple, actually carl icahn would be a 50% holder and filing a 13d. but if we look at ebay where it is right now pay pal is a standalone company could trade at 25 to 30 times earnings whereas ebay before this announcement was trading about 17 times forward earnings primarily because of the slower online commerce business which arguably you can separate the two. there are other services that can provide online payment support. pay pal does not have to be wholly owned by ebay. wroo joo would you.

>> would you like to see ebay pursue this? >> i would say definitely it makes a great deal of sense. there is latent value to be realized. right now you've got on ebay's books probably about $5.50 a share in net cash. the stock underperformed the broader market averages. the company doesn't have a dividend. certainly there is cash flow to be used there which could be used to enhance shareholder value either through a dividend a buyback, or a spinoff. i think the company's board should consider all three. >> it looks as though a buyback is being considered. and what more to break the company out of the 2013 range we were just talking about. it's now trading at almost 60 bucks, up 9% after hours. >> listen again, as david garrity indicated, this is no stranger to many people who have been investors in ebay. the company under some pressure of late because its stock prices did not perform well there's been weakness in the marketplace business and that has been

certainty an anomaly under the leadership of john doneahoe. it's not clear to me who the two nominee that is mr. icahn are or what they would have in terms of qualifications that would exceed the existing board at ebay. what i think is perhaps more interesting here is that he's doing this with a 0.82% position. i have been tracking this for a little while. there's been some talk in the marketplace he was massing a stake in ebay. even though he does not have a large position one-sixth the size of his apple position he's decided to pursue two nominees to the board and bring into the open this question that has been out there for some time. are you better off with pay pal as an important part of the business given how quickly it's growing or should it be separated out? some would argue given the multiple the overall business

gets, perhaps the benefits of that while stronger in the past are no longer as much in play. >> what do you make of just the 0.82%. he could have bought a whole bunch of this stock at 15 16 sometimes forward estimates, total laggard, and yet it's a small position. why do you suppose that? >> i think it's very curious. typically we know icahn controls as much as $20 billion in buying power when i have seen him and followed him so often in so many situations whether it's dell where we had so many conversations and he was in for almost $2 billion and could have gone up. with apple today. he bought $500 million more of apple. that's his entire position of ebay. as i reported in hertz and today, he gave you his usual. he may have a larger dollar position even there and may choose or may not choose to do anything in terms of a fight. but it is curious because it's so small. >> isn't this like the davos effect? all of a sudden the big are getting bigger? we just said netflix is

basically going to run away from the competition and lap the field and now we have carl icahn saying don't bother with marketplace. you're never going to catch amazon. you're always going to be viewed as an auction site and give up the ghost and don't even try to compete. we're seeing a separation of the really large segments of a company or a business from the other guys. >> yeah. listen ebay has been under some pressure. i haven't had a chance to review the numbers, which i know we're going to do josh lipton will do for us certainly this is going to be now something the company is going to have to actively combat and see what its own shareholders think, but we've heard from them. it's not likings up fore its up for debate. >> great stuff, david. let's get to josh lipton with the numbers. josh, can you tell us about the guidance, which we understand might be a little shy? >> kelly, let's look to the numbers. the street was looking for 80 cents on $4.55 billion. they deliver 81 cents or $4.5

billion. beat on the bottom by a penny. just going through the product segments, payments revenue was up 19% to $1.84 billion. that's a little light. the street was actually thinking you'd see $1.9 billion. marketplaces, $2.3 billion is what they turn in. that's smack in line with what the street was forecasting. as for guidance q1 this includes dilution from the acquisition, but they're now expecting 65 to 67 cents. the street was looking for 73 cents in q1. >> and you have to wonder where this stock would be trading right now if it were not for carl icahn. josh, thank you so much. we have some more breaking news. this time from treasury secretary jack lew. hampton pearson joins us with the story. >> jack lew has sent another letter to congress urging them to act quickly on raising the debt limit before february 7th. the best action he says would be for congress to act before the

february 7th deadline to finance the government. in the absence of that the so-called extraordinary measures would have to kick into place. here is the interesting thing about this letter. he says that back in december when i previously wrote to you, i estimated treasury would exhaust the extraordinary measures in late february or march. however, based on our best and most recent information, we believe treasury is more likely to exhaust those measures in late february. two reasons for that number one, the treasury secretary saying there's going to be a lot more money going out in early february to pay for tax refunds and there's a lot less borrowing authority available than in 2011 and 2013 the last time congress and the administration locked horns on the whole issue of raising the debt ceiling. back to you. >> and that date fast approaching. hampton, thanks. i want to check david garrity and david faber for joining us. we'll have plenty more ahead on markets. 52-week high for norfolk southern shares also.

that company clocking their best level over the last year thanks to a 24% jump in quarterly profits. the ceo discusses whether an improving economy is behind that move plus his plans to keep profits and the stock at top speed. don't touch that remote. we'll be right back. opportunities aren't always obvious. sometimes they just drop in. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities.

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street expectations. adding 2.3 million subscribers. the on line video service forecasting a strong outlook. ebay moving higher. david faber reporting that carl icahn has taken an 0.8% take in the company. the company announcing that in the press recess and he's also nominated two directors to the board. ebay announcing a $5 billion stock buyback program after topping fourth quarter earnings estimates by a penny. loral is spiking right before the close. we end with norfolk southern. they increase the dividend. kelly, back to you. >> thanks. on that note joining us now to discuss his fourth quarter earnings plus his read on the economy is wick moreorman.

>> thanks kelly. >> we want to recap what you reported. you had fourth quarter earnings up 24%. top line was up 7% and your margins grew. i wonder is that the mix of things you're carrying on the rails? what is it that drove the quarter? >> well, we clearly had an excellent quarter, and it really punctuated a very good 2013 for us, and it was a combination of things. the first is that we saw very good growth in both our merchandise business which has a lot of categories as you know and our intermodal business, which more than offset the weakness we have been seeing for some time now in coal and then the second was that we continued to run a very good railroad with superior levels of service for our customers and with the ability to drive out more productivity and operating leverage, and so on a 4% volume growth, we had 2% growth in expenses. so all of those came together to produce a really good quarter.

>> and it's that expense line which your competitor csx struggled with during the quarter and their shares a little bit weaker after reporting earnings. so talk about the discipline there. what are you doing? >> well it's the result of a lot of operating discipline by a great operating team. we have a lot of technology employed to help us drive our operating practices to make sure that we have as efficient a train plan and yard operation as we possibly can. technology to ensure we're burning the least amount of fuel that we possibly can, and improve the network velocity. it's people and it's technology coming together to really just maintain a very disciplined, focused operation. >> and on that note how much are you guys investing in 2014? we've been talking a lot about how companies have a lot of cash, but we haven't seen this investment boom everyone has been hopeful for. from your perspective, where is the opportunity, what kind of innovation can we expect and what kind of cap ex?

>> well we have another good cap ex program at norfolk southern. railroads are very capital intensive. we just announced today a $2.2 billion capital program. that's up slightly from last year but really in line with 2011, 2012 and that's maintaining our assets but buying new freight cars buying new locomotives. a lot of investment in technology as well and we're trying to invest in a lot of growth areas around the new energy markets. we're certainly investing in our very strong automobile franchise. so we continue to see a lot of opportunity and an economy that we think is actually improving a little more quickly than it has been. >> and that's such an interesting point because you guys do face a number of different parts, whether it's transportation housing with your lumber coal industrial products. you say based on your read of the fourth quarter and even the

early part of this year as stocks are searching for direction, why do you feel confident that things are okay and will continue to be okay in the months ahead? >> well that's a great question, and i think it's two things. the first is that we obviously look at all the macroeconomic indicators that folks are putting out and we see that people are predicting strength -- continued strength in automotives. we think steel is going to be a little stronger. we clearly see that housing is starting to come back although the base is still fairly low. we had a good harvest this year as compared to 2012. so both from the standpoint of those external indicators and really even more importantly from the standpoint of the volumes that we saw in the fourth quarter and what we think we're starting to see in 2014 albeit with some weather issues we've had to face -- >> sure. >> -- both of those give us i think confidence that 2014 is going to be a good year.

>> well it certainly pays to be diversified. we saw that in the share performance and we thank you so much for joining us. wick moorman. get out your notebooks. wait until you hear what the head of the most successful hedge funds says is the worst mistake investors make and make it all the time. we'll let you know what it is the equity summary score . he ratings of up to 10 in t research providers . into a single score that's weighted based on how accurate they've been in the past. i'm howard spielberg of fidelity investments. the equity summary score is one more innovative reason serious investors are choosing fidelity. call or click to open your fidelity account today.

welcome back. what do you in when the head of one of the biggest hedge funds in the world speaks in you better listen. we caught up with ray dalio in davos, switzerland. >> the biggest mistake of investing is that people think a good investment is that which did well recently. that it's a more expensive investment. and so you have to understand how to look at future returns. >> of course, want to bring the panel in on all of this. nathan bachrach i can't help but think about best buy, for example. >> that would be the perfect example. i want want to think that it's going to keep going up. i think he's absolutely right. look at all the advertisements for gold in the last year and a half. if we can track the money spent to advertise gold when it was $1,600 $1,700 today i think

you'd go i shouldn't use past performance to indicate future performance. >> i'm reminded of something julian robertson has said which is for everyone who wants to stay away from a high growth stock like a netflix because they have such a high price to multiple stephanie, if you look over time at that growth you buy expensive companies because you're buying that future growth, and if you pick wisely it's never too expensive. >> i totally agree with you on that. and i would say find stories that are in a secular growth environment, right? so we talk about themes all the time right? and so like health and wellness. whole foods comes to mind right? a lot of these various different companies come to mind in that particular space. they may not be very cheap, but you want to find the very best in each industry and if you get it on sale like whole foods is on right now, i think that's an opportunity to buy it. >> that becomes the question, mandy, how do you know?

how do you know when you're getting a great company at a great value as opposed to you've missed the narrative, you missed the boat? i guess you just have to do the homework. >> you have to do your homework. i think that's probably a question for someone like stephanie and nathan. i think your point about best buy is an excellent point. if you look at what happened last year, i think the stock was up 236%. it was kind of left for dead for a little while. if you went on what it did last year, you'd think i'm onto something but it's down over 40% since the highs in november. that's a perfect example of what ray dalio was talking about. >> the eternally how do you know. >> exactly. one of the other things he said which was interesting, everything he says is so interesting i think. he's a really fascinating investor. but he said, you know, don't chase a hot stock tip. you are going to lose. he really talked about that. that's like playing poker and making bets. he went back to the classic diversified -- >> that's what bridgewater

stands for. >> exactly. but it was so interesting because we see so much herd mentality. that's what he's saying, when something goes up does it mean it's a better investment or does it mean it's more expensive? and those are -- >> he says he likes balance. >> that's right. >> he likes balance and i would go -- >> because he meditates every day. that's why he likes balance. >> the all-weather fund. >> here is balance. balance is 65% stocks and maybe 35% bonds in a short duration. otherwise i don't think you can get any return. >> all right. we're taking notes. >> i think he also said we're in the middle of the boring years. that's a bit depressing, isn't it not going to boom not going to bust. >> not with you guys around. >> there are a lot of themes to go after, auto aerospace, housing. >> energy, tech. >> there's tons of things to dig into. >> maybe it's just a microworld. anf- f-5 is soaring after hours. >> the maker of networking gear soaring in the after hours after

they posted better than expected first quarter earnings. coming in with stronger than expected revenue. happening as demand rodese for its products. john mcadam will be on "squawk on the street" at 10:00 a.m. the company also forecast better than expected fiscal second quarter results. positive forecast there. kelly, back to you. >> and a 10% move to the upside. mary, thanks. cnbc is celebrating its 25th anniversary. up next, we'll unveil a list of nominees for the most in influential people in business. we want to you vote on who the top 25 should be. we want to hear from you on our twitter question. bill gates and steve jobs are both on the top of the list. if you could only pick one, which one would it be of these two. tweet us @cnbcclosingbell. your thoughts at the end of the

show.

welcome back. cnbc is celebrating its 25th anniversary, and to mark the year, we're assembling a list of the most influential business people over the past quarter century. allen wastler is standing by with a look at "the hot list." which of the nominees are already burning up the list? >> right now it's the usual suspects, okay? we've got steve jobs bill

gates, warren buffett, but there are a few surprises up there which kind of got me a little bit. i was part of the board discussing who we should put on this list and everything. we got j.k. rowling on there. over and above my objections because she wrote great books. she didn't change business okay? she just wrote good books. anyway, she's up there and she's in the top 25. so maybe shame on me for not considering her, but our readers are weighing in. you go to the page here, we've got it all dolled up. it looks really pretty. you look at all the pictures. what you can do just go on it and you just click wh youo you think you should vote for. you get 25 votes. so you vote for the 25. we put it in then you can see the results, all right? >> can you vote more than once? >> no, no, no shame on you. no. >> all right. >> it may look like you can but then you will see a message, we got your vote before. it's lots of fun. i have been having fun playing in the comments because a lot of the arguments we had on the board deciding who should be on

the list we're getting much deeper in the arguments and comments and we have it there is people can tell us anybody we missed? anything we didn't think about or consider? it's fascinating. i have been wasting time all day doing that playing that instead of doing my regular job. >> you're learning more about the importance of j.k. rowling as well. thanks allen. >> take care. to help pick the 200 contenders we assembled a three-person advisory board and let's bring in one of those advisers now. paul stiger our very own tyler math mathson who also had a hand in patriot ses. j.k. rowling, does that surprise you? >> no not at all. when j.k. rowling came to "the wall street journal" for lunch, i tried to tell people not to embarrass themselves by rushing her for autographs. they ignored me entirely.

>> it brings up the question of celebrity versus transformation or importance because there are a lot of people who didn't make the list because they didn't have the name recognition and perhaps j.k. rowling has the name recognition but has she transformed industry? >> i think in making the preliminary list of the 200, we tried to focus in on the business impact. i think that was -- that's really important, and, you know, you mentioned people like bill gates and steve jobs. they're slam dunks for the 25 and they should be without question. they were the two very different guys, but they were the leading pathfinders of the digital age. >> tyler, who was there most disagreement about? >> that's a really good question and a hard one. i think one of the people who was on the list that didn't sort of ring my bell but did of one of our advisers jeff sonnenfeld was quincy jones. quincy i don't question his contribution to music.

i don't questioning his importance as a music producer dating back to sinatra and michael jackson, but i thought his most signal impact repredated our period of 1989 into 2014. another one that was controversial for similar reasons was one of the sort of scoundrels on our list so maybe not so much a scoundrel anymore, michael milken. >> michael milken went to jail but he paid his debt to society and he's done a lot for charity since then but most of his business impact was before 1989. >> and what about bernie madoff. in light of the news today about his health problems we were asking earlier whether there's anything that's been transformational about what he's done beyond just the extent of his activities? >> well my feeling, and tyler,

you may have a different view but my feeling is that he was quite simply a mega ponzi scheme, and, you know, there have been a million ponzi schemes, and i'm not -- and there will probably be more alas, so i don't think we should put him on the list as a transformational figure. >> there were some folks that paul felt strongly about as i recall in our conversations. one was oprah winfrey, another was arianna huffington who sort of developed the news blog online news website in some ways. marjorie scar dino of "the final times" was another but that shows you the breadth of our conversations. we went to old media and new media in searching for people. an awful lot of the folks, as you might expect were out of media, which was gone through so

much transformation and technology. >> real quick, paul, the he be tent -- ezra klein leaving "the post," is that a mistake or will these be the next generation of transformational people in media? >> i think the next generation of transformational people in media, they're going to be your age, not their age. >> maybe ezra. thank you so much for joining us this afternoon. really appreciate it. paul stiger tyler, thank you so much. the full list of those 200 names is online. it will be narrowed down to just the top 25. and it wasn't that long ago that russians stood in line to buy a loaf of bread. what uber wealthy russians look for in a american mansions. a stuffed giraffe, anyone? jae yeah. we'll be right back. open to bold ideas. that's why new york has a new plan -- dozens

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welcome back. we all like to get let in on a secret. and cnbc will do that for you. it's "secret lives of the superrich" on 9:00 eastern. and robert frank with a sneak peek of the premiere. robert? >> tonight, we're going to follow a rich russian couple as they go mansion shopping on long

island's gold coast. one stop was this $15 million estate. and its very unusual wild life. down this spiral staircase to the basement the couple is greeted by something you're more likely to see at the museum of natural history. a full-sized stuffed giraffe. >> it's beautiful. >> that's a three-story high giraffe. >> it's so big it had to be cut into three pieces and reassembled in the middle of the staircase. >> the first time i've seen a giraffe in my life. >> really? okay. you have to book a trip to africa. >> so other than stuffed giraffes, what do the rich russians want? they have been buying in new york and miami for years. now, they're moving out that into the suburbs. they're looking for high security good schools, big

closets and a safe room. apparently most of the rich russian buyers really need. >> a panic room? >> i'll let you sort out why that is. >> i want to know if this means the suburbs is not over after all? >> i wrote a book called "the end of the suburbs." >> i can picture the series right? >> exactly. >> that sounds like the name. we were trying to think of the name. i think you've come up with it. nathan, are you going to watch? >> i might. i'll tell you, it reminds me that the old communist leaders never show off their wealth. and the new leaders are more than happy to show off their wealth. it's a bit of irony. >> i wonder if it's changing because we're talking about the ostentatious nature of it all. in russia there's a higher level of domestic savings. >> there's been periods when the russian economy contracts and goes through convulsions. they have to pull back.

they're not going to build the yachts and buy the penthouses like before. but they keep on doing it because they feel so protected. for now. >> it will be fascinating. season two of "the secret lives of the superrich" here on cnbc. find out more about the panic room. bill gates or steve jobs? who you think had more impact over the last 25 years. keep it right here. we know we're not the center of your life, but we'll do our best to help you connect to what is. mine was earned in korea

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welcome back. so we're starting to narrow down cnbc's most influential leaders list. if you had to choose between bill gates or steve jobs to make that list who would it be and why? there's a lot of interesting thoughts. no-brainer, bill gates for his pioneering contribution to technology. and the flilphilanthropic work. and jobs. the world bought gates' buckets because there was no other product. >> that industry matured. and steve jobs was a wonder child. >> and we had recency with that.

greenberg was on the street this afternoon. i liked his approach. he picked both of them. it's a tossup. i can't choose one or the other. >> and you can. >> i think you have to pick. microsoft will be 40. we're thinking about the last 25 years. i would go for -- >> 40. >> yes. >> i would go for jobs for that reason. >> jobs and -- jobs and more steve jobs. he took the p.c. he made it small. this started the arab spring. people weren't lugging around p.c.s. control, alt, delete? >> we don't know as many failures for gates as we do about jobs. i think jobs' failures made him a better leader. he almost went brupankrupt. he had the next product he didn't know how to sell. he had so many failures. >> our kids will look at p.c.s

like we look at record players. and go oh vinyl. that's nice. >> we got to go. we got to go. thank you so much. a lot of fun. a lot of news to get through. melissa lee -- we lost nathan. what are you talking about? >> when you're on a plane, you love wi-fi. who doesn't? we're going to be speaking to the ceo of go go. hit the skids in the beginning of december. down 30% from its high. we'll talk about what's happening with the stock, where he is expanding and the competition he's facing head-on from the likes of a jetblue. >> a lot of people using it to watch netflix. "fast money" starts right now. i'm melissa lee. our traders are dan nathan, don me jaren