now down a percent. >> liquidity isn't there in the emerging markets. getting out there takes time. i think they will be out by this time next week. >> final trades? >> buy wendy's. >> simon? >> i was trying to say this, northern southern. >> i like tmo, thermal fisher. >> have a great weekend. "power lunch" starts now. "halftime" is over. "power lunch" and the second half of the trading day starts right now. >> one of those guys will say they were long peyton manning or long russell wilson. i'm not sure i would go quite this far. oh, what a comeback on a day when the dow is still down 108 points. but remember, we were down 230 points earlier. right now, down about 110, 111 at 15,737. we will take that one apart for you. regardless of today's drop and then the bungie jump back, we are asking a very important question, why? why, why, why is this happening?

we've had triple digit ups and downs all week. we will talk about this, one guy with the answers, the author of "the black swan." is all this volatility the start of something cyclical? we will also focus on several big name stocks with big drops. on our list, mattel, amazon. if i got out of the way, you could see them. mastercard and chevron. ugly duckling kind of day. the man with the black swan is here. you are down there. >> i'm down here on the floor where the tone is decidedly better but of course, not as good as the bulls would like it. we were down 230 points so this is quite a comeback. bob pisani is on the floor and sheila is uptown at the nasdaq. bob, you know, does this comeback have staying power and a lot of it has been linked to currencies but fridays are traditionally not in a crisis, not good for currencies. >> you will devalue currency,

you do it over the weekend. the answer is the recovery is nice but very fragile. that's all you can say. anything more is really not very smart at this point. let's show you what's going on. the s&p 500, well, we hit the lows right after the open. this often happens and traders look for a bounce. that's what we got. as we he got closer to the european closer, europe improved. most of it was down. that happened here in the united states as well. we are near the highs for the day. the dow is having trouble again today. it's been a mess all month. down almost 5%, the s&p down 3% on the month. that's because individual stocks are having earnings problems. today, chevron wasn't bad, just no growth, just like exxon yesterday. chevron had earnings, dragging things down. because chevron was down, exxon is down, that's hurting the dow. mastercard had earnings and is dragging visa down. mastercard disappointed, dragging visa and american express down. there is only 30 stocks in the dow. this is a problem when you have weak earnings. there is some bright spots. i will just mention construction, most of the home building stocks are up this

month. new orders were up 18%. a little disappointing but i think people were happy enough. again, mostly on the upside. 30 stocks in the dow. that's a problem. >> we are going into a weekend where the emerging markets are in a delicate condition and we have big economic stats in the u.s. next week. perhaps it's understandable. let's go uptown to sheila at the nasdaq. >> i'm going to say we are having a great comeback at the nasdaq. in fact, now we are only down .2% so really well off session lows and if we keep this going, in fact, we are only going to be down less than half a percent for the week. so really, a lot of positive news from the nasdaq. what's working here is the earnings winners. investors really focusing on the winners, doing all the heavy lifting today bringing up the nasdaq is google, after that positive earnings report. investors really focusing on that volume spike when it comes to advertising. also microsoft and reports they may have found a new ceo. want to quickly mention wynn.

there was a lot of concern about this stock and what's happening with china. if you take a look at their profits, up 92% thanks to its macao operations so things going well there. >> thank you so much. we will check back in just a few minutes. let's go up to e.c. seema mody has a market flash. >> check out numont mining, they issued production forecasts that came in below street expectations. rbc dominion securities downgrading the stock, and the company saying it might curtail operations in indonesia unless its tax dispute with the government is settled the next couple months. stock down 9.7%. tyler? the emerging threat having a profound impact on retail. mainstream retail and the luxury market. robert frank covers our wealth beat and will be talking about the luxury sector in just a moment. be patient, robert. first, to stacy woodlitz in

london. several mainstream retail names are vulnerable here. let's start with nike, down 7% this month. obviously they count on the emerging world for a big slice of their growth. >> they do, tyler. nike has about 15% exposure to emerging markets. brazil is very important. china is very important. they have been making great strides in those markets, and their numbers have been phenomenal until now but you have to worry at some point, not only the effect, does the economy there come home to roost and start to hurt revenue and margin numbers, which have been so strong to date. >> are there other u.s. household names in retail that are in the same basket as nike? >> well, it's mostly the consumer product names, beverages, restaurants like yum brands will have significant exposure in emerging markets. luckily, most of the retailers that we have in the u.s. don't have huge exposure.

obviously walmart's got a little bit. but you know, it's consumer products, beverages and those kind of stocks that you really have to watch out for. >> what about ralph lauren, so forth. those? >> sure. what's been really interesting is that as u.s. growth slows and store growth is maxed out, a lot of retailers have been jumping across the pond to europe. so you're seeing pdh, tom hilfiger, abercrombie which has been a bit of a disaster in europe, come into europe as the gateway before they jump into china and other emerging markets. some have fared better than others. ralph lauren has been decent. pbh has been decent. abercrombie has been a bit of a disaster. >> yeah. even though it's up this month. thanks very much. we appreciate it. now to the luxury side of the story. robert frank, how vulnerable are the lux names? >> this is a big warning sign. the very top of the luxury business was supposed to be immune from these economic troubles but it's quietly imploding, especially in china.

lvmh, the paris luxury conglomerate reporting that china revenue growth falling by more than 50% from 2012 and profits in the critical fashion and leather unit, they of course make fendi bags, those fell 4%. ferragamo saw its share of price fall 7% yesterday after asian revenue growth fell by more than half. analysts telling me we have really reached a turning point in china. the luxury industry has been betting all of its growth on china. now it's turning back to the u.s., even to europe. if we look at a report from a holding group today, big growth in the $1.8 trillion luxury industry will mainly be in the u.s. cities that may have in fact a shortage of luxury stores leading the list, new york followed by las vegas, chicago, dallas and houston, all in the top ten. so a huge paradigm shift. again, this was an industry that was focused on selling stuff to china. now it's really about selling experiences to the u.s. and european rich. so big move there. >> interesting shift. >> just in the past few months.

>> thank you very much. sue, down to you. >> we are also tracking the auto stocks in the midst of these emerging market threats. honda down 8% in a month, as it warns that its sales are cooling in emerging markets. gm down 10%. ford down 3%. joining us now is dave woosten from morningstar. thanks for joining us. how worried should we be particularly as it pertains to honda given the continued kind of meltdown, albeit slow one, in the emerging markets? >> sure. honda reported today third quarter fiscal '14 results and honestly i think they had a pretty good quarter despite what we're hearing about with headlines in places like thailand. you have to remember with the japanese auto makers, it's important to look at the yen to dollar exchange rate. they are getting huge tailwind from the yen continuing to weaken. operating income i believe was up about 73%. but only about 10% excluding currency. volumes are still pretty healthy. everyone in the auto industry is

concerned about brazil. but that's smaller exposure for honda. their biggest market and most profitable market is the united states. >> it sounds like what you were saying is perhaps it's a small drag on honda, but nothing, given the fact that the yen is such a tailwind for them, nothing that we should worry about longer term. is that a correct read? >> right. i think any huge sell-off that would happen with the japanese auto makers while the yen is continuing to weaken would be a tremendous buying opportunity. what unfortunately happens with a lot of stocks, autos or otherwise, is that macro concerns in the short run could trump any kind of strong bottom up fundamental performance. you are seeing strong earnings from honda and will probably see it from toyota when they report but everything is getting sold off because of emerging market fears. in the long run that will create buying opportunities. right now honda is fairly valued. >> thank you so much for joining us. ty? >> thank you very much, sue. the always thought-provoking,

often controversial nasim taleb is with us. great to have you with us. as a former derivatives trader who correctly called the crash in "the black swan" and known for his other best-selling books, now he is an advisor. we get that all right? >> pretty much. yeah. also professor. that's the boring part. >> open-ended question just to start here. what do you think is happening in the world today financially with the emerging markets and so forth? and why? >> the problem being an old trader is you have a feeling of deja vu. every time we have a very low interest rate in the u.s., we don't live alone in the ecosystem. yield tracers go wherever they can get a few basis points. of course, you see what happened. they went to emerging markets. the currency strengthened, interest rate dropped, and now they get nervous.

>> so they get out of there? >> no. they are trying to get out, trying to -- someone may have to buy fur coat and hit the stop loss, can cause a few micropanics. this is not unusual. this is not unprecedented. this is the cost of having a policy of low interest rate without thinking of consequences. >> so you think an awful lot of what we're seeing and going through today, this month with the sell-off, traces back to quantitative easing and the era of cheap free money being thrown at the banks, basically. >> exactly. two things, cheap money given at the banks -- there's nothing wrong in giving cheap money to the bank. there's nothing wrong with a policy that aims at getting us out of trouble. the problem is not thinking of consequences of these things, number one. and we see the consequences aren't trivial. then the second thing is not fixing the core of the problem, you see. >> the core is? >> the core is that we have a banking system that is too big

to fail, getting even bigger, right, and we have moral hazard in the system and the banks, as we saw with jpmorgan aren't better at managing the risk, and are using our cheap money to pay themselves bonuses. what kind of environment is this? this is an insult to capitalism. >> we are going to come back and talk more about this and other things in just a minute. we will take a quick break. we've got a lot more questions right after this break. sue? >> that's right. more with nassim after the break. plus listen to what the head of trading strategy at wells fargo said this morning. >> we think potentially, the december 31st high very much lines up with the peak in september of 1929. >> yikes. put the brakes on. let's listen again. >> we think potentially, the december 31st high very much lines up with the peak in september of 1929. >> yep, you heard him right. is he talking about a

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welcome back to "power lunch." i'm seema mody. check out shares of buffalo wild wings, now at session highs. we can only speculate, but the reason could be the super bowl. the national chicken council said an estimated 1.25 billion wings will be eaten during the big game, up 20 million from a year ago. wonder who's doing all that counting. tyler? >> or all that eating.

i will have one billion of those wings. jittery january. if you believe this is the start of a correction, how can you protect yourself? dominic chu looking at some winners and losers, the last time we had a steep correction. >> it's interesting because if you take a look at what's happening with the overall charts and whatnot, if you look at the s&p 500, go back to april and october of 2011, that's where you really see this movement in stocks. that's the real key here. they dropped about 17%, 18% that time around, the last true technical correction, if you will. now, the reason why it's important was there was an interesting mix of the winners and losers. on the winning side, the best performing sector was by far the utilities. one of the more defensive sectors. that's the reason why it's important. the utilities did outperform during that time period, only down about a percent. now, the biggest loser on the opposite end of the spectrum, talking about the financials. if you look at the financials here, they are down and down quite a bit here. you can see down about 28%, 29% during that last correction phase. so a huge move down.

among the big winners, the winning stocks, even despite the fact that all of ten sectors in the s&p were down were a couple interesting dollar store names. take a look at names like dollar tree and of course, what's happening with dollar general. these two names in particular stood out, up 14% and 31%. monster energy also up 24% during that time period. and the biggest losers, interestingly enough, some big names in oil as well as financials. marathon oil down 61%. micron down 60%, a big semiconductor winner last year. >> look at that. that's a random -- i want to do what you just did. how did you do that? i want to make my thing bigger here. that's a random group, a bank, a tech and an oil. >> but they are cyclical. they ebb and flow the most with the economy. with the s&p 500, when we rebounded from these lows, up about 14% by the time it was done. >> thank you very much. appreciate it. sue? let's bring in kenny pulcari

and bob pisani to talk about this market. we highlighted the conversation between you and abigail doolittle where you focused on citigroup and they thought things were going to break down. you are not necessarily surprised by today's act? >> no, not at all. yesterday's action, you could almost feel that didn't have the follow-through. if people just looked at the numbers, it looked like they were raging bulls and dying to buy, yet if you felt it in your gut the way you feel it, you didn't have that sense at all. that surprising up move led you to believe that today you would get this. listen, it's also the end of the month. january is not going to end on a positive note. people know that. so people are almost kind of cleaning house today. >> bob? >> it is kind of strange that we woke up suddenly to concerns in a market part of the world, turkey, that had not attracted much attention. i think it's more accurate to say rather than why is the market down 5% or 4% this month, why was the s&p up 30% last year.

you can turn it on its head. i find that a little harder to understand. >> let me bring nassim back into the conversation. there was a lot of talk in the market this morning that the futures were telling us that we're going into a weekend where maybe there might be some sort of a black swan event. if you go -- do you adhere to the theory that the market always knows more than we know? and sooner than we know it? >> i think the market knows a lot, but the market -- neither the market nor humans can predict black swan events, believe me. that's the unfortunate problem. but markets know better than humans. one thing i would like to say, there are definitely fragilities. by now i have a gray beard so anyone who has seen 1994, for example, when you saw the mexican peso move 50% in no time. we saw panics and hysteria and interest rates going up

thousands of basis points in minutes. so really, we're not talking about volatility in the traditional sense. this is just some people getting out. >> there has been an unusual dearth of volatility over the past few years. >> there has been. they have not raised the rates. the point is that now we are talking about small things. you have to worry about one thing. if they raise rates, what comes with free money, to a point, it's going to stop. the minute the free money will stop for some reason or another, then it has to worry, then bring me back and we talk about volatility. for the time being let's talk about how to fix that thing that is broken that has not been fixed in six years. >> is there more -- bob pisani. is there more tfragility than 3, 40, 50 years ago? >> definitely. >> it seems to me that increasing complexity has not decreased the risk in the world.

increasing complexity has increased the risk and fragility in the world, would you agree? >> exactly. 50 years ago, you could raise rates in the united states without affecting turkey. today, just the idea of rates having to, you know, stop being subsidized and causes panic and panic causes some kind of anxiety in turkey. 50 years ago we didn't have that. 20 years ago, a little bit but not that much. >> but what adds to that complexity, that volatility, is the fact that the news moves so quickly around the world that the speed at which this news moves is what causes -- adds complexity and causes a lot of this anxiety. >> no, no, the real reason is the same passengers on the same buses. in other words, the same investors in the same places. that started about 20 years ago. so the same passenger, you heard here you have to unload there

and causes a train reaction. >> what was it 20 years ago? you mentioned 20 years ago twice. what happened that somehow increased fragility? >> what happened, you start having diversify. you can invest in turkey, u.s. investor you didn't have to worry. if everyone does the same thing, you have contagion. someone loses money in the u.s., have to unload his inventory elsewhere in turkey and it cause a train, you know, some kind of interlocking panics and we are having more and more of it. >> but that's the search for alpha, isn't it? that's the search for the edge that everyone who manages money seems to need these days. if you can't get it here in the u.s. because things are so highly correlated, you take on more risk and perhaps you make your portfolio a little bit more fragile by going to where you get the most yield. >> yes. and correlations have been increasing over the past 20 years. that's a fact.

you can look at your screen, it's got all the red. >> let me ask you, this is a historic weekend. ben bernanke is leaving. janet yellen is coming. you talk about policies and free money, giving away free money that has been the case over the past five, six years, how do you rate ben bernanke personally, and how do you think he and his policies will be remembered? >> i don't know if you can talk about ben bernanke alone, because he is not in control. the banks are not under his control. his job is not to break up the banks. his job is to try to optimize certain situations. i think the problem is the obama administration. they are the ones who did not have a coherent policy of curing the disease. i can understand that if you have a debt problem, they give you a little debt, you can't cure debt with debt, but give you a little bit. what they have done is cure debt

with debt and curing us from the banking system, from too big to fail is bigger to fail. this is unacceptable. i think that obama administration particularly geithner is responsible for all that time wasted. >> thank you very much for being with us. always interesting to have you with us. your book "antifragile" is in paperback today. >> yes. yes. yes. >> congratulations on that. >> thanks a lot. thanks. have a good day. >> thank you very much. searching for the safety in the volatility. yields on the ten-year bond falling to their lowest since october, 2.663. what traders are saying about where rates may go from here. and a look at the top five dividend paying stocks right now. mine was earned in korea in 1953. afghanistan, in 2009. orbiting the moon in 1971. [ 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.

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swelling of the lips, tongue or throat, or difficulty breathing or swallowing, stop taking cialis and get medical help right away. ask your doctor about cialis for daily use and a 30-tablet free trial. welcome back to "power lunch." i'm seema mody. manitowag is surging on five times its normal trading activity, posting better than expected fourth quarter earnings. the company says crane orders have reached a level not seen since before the recession. on the conference call, management said it expects moderate revenue growth this year. one of the outperformers in today's trade. sue? >> nice 15%. thanks, seema. to the bond market, where everybody is watching the dollar yen trade and also interest rates. what a week we've had. >> what a week. listen, if you're long stocks viewers or listeners, i understand why you're not maybe

as happy about things as i am, but i'm happy because things are moving around and if you're a market watcher, it's the rubik's cube and you try to figure it out. intraday, two day, going back to the first week in november chart of ten years, you will get the picture. it's continually been downhill in terms of rates, up in terms of price pretty much all year. now, what sue is referring to, i call it the one chart this morning. one chart you have to watch. whether you look at an intraday of the dollar yen versus the dow or you look at a year-to-date, you can clearly see that really, it keeps you on the right side of the marketplace. that's the carry trade or lack of carry trade moving forward. i think if you really want to keep it simple, this is the chart to watch. back to you. >> i couldn't agree with you more. thanks so much. let's go back uptown. the nasdaq actually is doing quite well, given where we were this morning. sheila is back with us. >> when i was on last time i talked about the nasdaq's comeback, also the big winners

like google. but let's not forget the nasdaq is still down for the day. here's what's dragging it down. amazon of course, the biggest loser today after that weak earnings report. investors just not happy with 20% sales growth. mattel having a big case of barbie blues, reporting a very weak fourth quarter earnings. its international markets were supposed to be its bright spot, ended up not being very bright. investors pushing the sell button there. biotech is interesting. the overall nasdaq biotech index down more than 1% on weak earnings from celgene. >> thanks. i don't know how barbie sales could be weak. i had 50 of them at my house. as does sharon epperson, i know. she joins us now because gold is closing. >> we are looking at gold prices right now that are near the lows of the session, down about two bucks or so. gold had been significantly higher, of course, when the dow was down more than 200 points. it's given up some of the gains and continues to trade inversely

to stocks as it has been the last several trading sessions. when you look at what's happened to gold this month, it's had a nice gain up 3% or so, and we are looking, though, at some of the upside according to hsbc, perhaps not being fully realized because of producer hedging and a lack of conviction among investors about whether or not they want to be in this precious metal. back to you. today, it's the last day of ben bernanke's term as chairman of the federal reserve. janet yellen takes the helm. what is going to be her first challenge? >> you just look up above me at what's happening with the markets. that's what her first challenge will be. the idea that the markets challenge every first fed chairman in some way. this could be the exit from the monetary policy, the stimulus, the $4 trillion balance sheet. those are the challenges. >> we will discuss that and more after this. [ tires screech ]

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let's get back to the market. welcome back to post nine. bob pisani is here on the floor

of the nyse at the post with me. we were down 230 points about, now we're down 112. >> that's right. the important thing about the s&p 500, let's take a look at that, we were at our bottom just after the open. often, people will come in and watch what happens at the open and if we just keep drifting lower into 10:00, 11:00, it gets notably worse. once you see a little bit of bounce, it stabilizes, a lot of people come back in, we had a very good close on the european close, germany moved to the upside, but didn't close in positive territory. you see we're moving sideways during the day. we have a problem this month, there's a real disconnect between the dow and s&p. the dow is down 5.2%. the s&p is down 3.4%. that's 180 basis point difference. that's a very large disconnect. it's happened because certain dow components, because there are only 30 stocks, are disappointing on earnings and getting hit very hard. we are seeing a good example of this today in what's been going on. chevron came out with earnings that weren't terrible but weren't special. there wasn't a lot of growth. that's dragging it down. exxonmobil was disappointing the

other day, they didn't have a lot of growth either. it's being dragged down. today, mastercard was disappointing. it's hurting visa and american express as well. interestingly, walmart which was down earlier on the comments they were making, has just come back. that's interesting. it moved into positive territory. i think my point here is that it's an unusual situation with the dow underperforming the s&p 500 so greatly here. i think it was very interesting what nassim said today. basically we are all slaves to modern portfolios theory. we were told 20, 30 years ago, everyone should have 5% or 10% of their money overseas in emerging markets, in developed markets and everybody did that and we have etfs now that available us to do that. as a result, we are now interconnected with the rest of the world. we were talking about increasing the complexity, increases the risk. that's what he meant when he said the world is more fragile. that's what he meant. >> transports just ticked positive. that's my favorite indicator. >> because it's the u.s. economy. >> that's right. >> you are about the u.s.

>> i am about the u.s. you're right. thanks. ty, up to you. >> thank you very much. let's do the countdown with steve liesman. last day for mr. bernanke. first day, monday, over the weekend, for miss yellen. her big challenge will be? >> dealing with the transition from quantitative easing to forward guidance. she comes in with the market already concerned about how we have that graphic there, passing the baton. i think living down that graphic is one of the challenges of janet yellen. but it's a key issue here. the fed is on track with the support of the committee, unanimous support given in the january meeting. >> first time it had been a unanimous vote in quite awhile. >> it hasn't happened. bernanke let that happen. i think one of the stories i have been reporting the last couple days is that because bernanke created a series of rules and a series of metrics out there, the transition from bernanke to yellen could be easier than the transition from greenspan to bernanke.

it's much less of a charman-centric committee now and my guess is yellen runs it that way. >> on to the imf. what are they saying about the emerging markets, what are they likely to do? >> my guess is they're on the phone with some of the other countries advising best practices when it comes to these sorts of issues. it's interesting to think what those best practices are. they are calling for structural reforms which they have been calling for. there was a call to use the time created by qe to help internal domestic economies. not all of them did that. i think they are trying to urge calm and also trying to say these liquidity things that are going on in the developed countries, for example, the tapering in the united states, they need to be mindful of the effects on emerging markets. not sure what the fed would would differently. >> speaking of mindful, one must be mindful of the prospect of deflation because as pernicious as inflation is, deflation can be even more and more intractable. today's europe's inflation numbers came in lower than expected.

is there a deflation threat there? >> we are definitely in a period of disinflation in europe. whether or not it becomes deflation, we go zero and negative for quite a period of time. the u.s. numbers are kind of hovering in a stable position at 1.1, lower than the federal reserve would want, by the way. it's something that keeps the fed maybe from going faster on quantitative easing than it would otherwise want in terms of reducing it. it's a concern that's out there. there are different pockets of inflation, for example, on some of these emerging markets, the developed nations are the ones where it looks like we have disinflation at this point. >> you are playing in brooklyn while the emerging markets burn, you will be playing guitar in brooklyn. >> somebody has to do it. >> have a great weekend. sue, down to you. >> as you and steve both know, the major averages are set to end their first negative january in four years. is the sell-off the start of a further correction and how should you be investing right now? we are joined by the managing director of wells fargo advisors and kevin kurran is with us as

well. welcome, gentlemen. kevin, i will start with you. it strikes me that at the end of last year, actually for quite a bit of last year, when we had spectacular gains, a lot of people were looking for a correction, hoping for a correction, to put cash back to work, but now that we have a bit of a correction, nobody wants it. >> i think you said it exactly right. if you go back a year ago, wind the clock back 12 months, go find the most bullish strategist on wall street and the answer was where the s&p is going to be today, in 2014, the most bullish forecast was the s&p would be around 1600. here we are still near 1800. i think the market had number one, a very big move last year, was not really driven by earnings, wasn't driven by falling interest rates. it was simply driven by investors being more willing to take on risk. i think there is still a bit of -- a bit further the market would have to pull back before real value investors would get excited. >> do you agree with that,

brian? we might have just a little bit more to go but then we get some decent valuations again? >> well, i don't know if it's always just a valuation story. when you look at the size and scale, i think kevin is spot on. we had 16% in '12, 32% in large caps in '13 with no major significant pullback basically since the october time frame in 2011. markets don't go straight up. you need this consolidation phase. everybody has been looking and waiting for it. we are getting it right now. bigger picture is what do you do during the consolidation. that's a focal point for investors right now. >> yeah. that was what i was going to ask. if we do have further to go, given the backdrop of the volatility in the emerging markets, what do you do? what would you recommend to people? >> you know what's interesting, the fact that when we look at investors, they have a tendency to want to look at investments in things they know and love. there is a tendency to be overweight in u.s. stocks. we look at the global growth prospects over the next couple of three cycles, we are looking

at better growth prospects overseas. counterintuitive to right now given the reason for this pull-back is what's been going on with the volatility in emerging markets. we are actually looking at that area not so much for the fact we think it will be very great in the near term, but from the perspective of we are building portfolios over the long time, generally seeing investors underallocated through things international and given the growth prospects at least at this time with these pullbacks getting closer to market weight, getting that asset allocation balanced and maybe looking to take some of the rebalanced positions out of the gains in large caps over the last couple years. >> so kevin, tell me how you are playing this. how concerned are you about what we are seeing overseas, or does it not factor in to your allocation of cash that much? >> well, it certainly does. in fact, in the asset allocation models that we are responsible for here, we have actually cut back our exposure to emerging markets first in the second quarter of last year and now we have cut them pretty significantly last week.

even though i have to acknowledge that emerging markets are cheap, the emerging markets are trading as a single digit multiple, not a double digit multiple, for example, there is a wild card issue at play here. you have emerging markets that have had -- have been big recipients of foreign capital, they have had their terms of trade go against them. you've got cash flows coming out of them and many rigid constructs around their currencies which makes for the potential for i hate to use the word again but a black swan event. so we're being a bit more careful there, bringing the money back, playing close to home. we are dollar bullish and we are going to stay that way as far as the asset allocations. >> very quickly, you like health care and technology, kevin? >> yeah, health care and technology i think make a lot of sense. they have underperformed the last couple years. some of the big large cap names are trading with low double digit multiples. health care, same dhichk. same kind of thing. there is usually not a lot of

leverage with health care, many very good franchises. if you are skittish about the near term situation, perhaps you can find good values there. >> gentlemen, thank you very much. have a great weekend. see you soon. ty? >> good-bye, january. for many, i guess good riddance. it's been a rough month for equities. that's continuing today. is the sell-off that we have been a part of this month the start of something deeper? the long feared correction? we will talk about that and how to position yourself for the start of the new trading week and month beginning monday. this is for you.

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sue? >> boy, i bet they're relieved given the way the market opened today. thanks very much. let's get you caught up, speaking of the markets, just a few moments ago we were only down double digits compared to a very ugly opening which took us down about 230 points. right now we're down 98 points. so the market continues its improvement. that's about two-thirds of a percent. the s&p 500 is only down a third of a percent right now, about six points, almost seven on the trading session. the nasdaq is down about 12 points on the trading day. what are they watching? they're watching the transports because they were negative but they have turned positive on the trading session with a gain of a tenth of a percent or almost eight points to 73.09. also watching up that dollar yen which if you laid the dollar yen chart as rick did earlier this morning over the dow jones industrial chart, they were basically tracking each other tick for tick. everyone is watching the dollar yen right now. as you can see, the dollar is

weaker against the yen. in terms of the ten-year note, the trade at the end of '13, 2013, was to basically get out of your bond funds because interest rates were going up. the fed was going to taper. so far, that has not worked, because the ten-year note is now back down again to 2.66% and we have had lower interest rates almost since the beginning of 2014. not quite the beginning of 2014 but almost. so you are up to date on the markets with the major averages set to end the first negative january since 2010. is this the start of that 10% to 15% correction that some investors are expecting? >> we think potentially, december 31st very much lines up with the peak in september of 1929. >> that's only part of the conversation that he had this morning. more on that is coming up next. searching for trade ideas that9 spark your curiosity tdd# 1-888-628-2419 can take you in many directions. tdd# 1-888-628-2419 you read this. watch that. tdd# 1-888-628-2419 you look for what's next.

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welcome back. you certainly want to listen to this because it's pretty sobering. >> we think y, the december 31st high very much lines up with the peak in september of 1929. now, first off, we are not looking for a crash in any way,

shape or form. we're not looking for 50%, any percent, anything like what ultimately took us to the 1932 bottom. but the first decline was 15% or so. in 2013 all portfolio managers who hedged their books at various times during the year all essentially had losing trades by the end of the year because we closed on the highs so all hedges didn't work. we came into 2014 basically saying, this is anecdotal evidence from so many people we spoke to that we are giving up the idea of hedging, it cost us a ton last year, this market doesn't pull back. >> let's see what our guests think about that. joining me at post nine, cnbc market analyst kenny polcari and joe greco. do you agree with what mr. bensinger said? >> clearly more experience than i have on the street but always a dangerous trade, trying to overlay charts that are about 80

years apart. i think a lot of the game has changed. of course, high frequency not a part of the market structure at that point. very much a driving force in stock volatility today. i think you really have to look back at general market feel. that's how everybody down here made money and still do. market feel. what do you sense, what do you get the emotion from the table and how do you trade off that. >> that's the human element that has been missing in some elements of this market. >> right. i also think as much as we need a correction, we talked about this a lot, i don't think you will get much more of an 8% correction. it doesn't feel like it's going to be like that. it's something you got in your gut. >> but the fundamentals, let's take the emerging market equation out of this. you can't do that completely, certainly, but if you look at the united states and you look at the economy, yes, we've had some raw data points that have not been as good, but there have been an awful lot of good data

points which seem to be underpinning when this market comes back up. we're hearing from people the fundamentals are still good in the united states. >> i think the name of the game here for the fed was really hold on as long as you can and hopefully everything else will fill in and that will be the bid when we step away. we are at the point now where it seems like it. i'm not really concerned about what's going on in turkey. don't take offense. i would love to vacation there. but we went through two summers of greece being on fire and in the end what really happened? nothing. we are exactly where we were. >> we have had huge gains. >> i visited there at the low for the euro which was great. besides that, we really didn't see anything as far as what's going on here, the domestic story. speaking of the viewers that are watching here, i think you need to recognize that the story's actually kind of optimistic now. i don't necessarily think we need a correction but i agree that any correction we are going to see is not going to be drastic and will be very short-lived. >> i think an awful lot of people have been saying this is a stock picker's year. i would argue that january has borne that out because in those cases where companies have done

very, very well, the stocks of those companies like caterpillar have done pretty well. in those cases where there have been problems in the report, the market has not been forgiving this year as it was maybe last year. >> right. that's the way it should be, right? companies should be rewarded that do the right thing and ones that miss or do the wrong thing should be punished. in fact, that is how the market should trade. i think now that the fed has started to step back and upped the ante again this month, it's going to get back to normalization in the trading world, as it should. for so long, even when greece was imploding a couple years ago, the fed and every other central bank was there to hold everybody's hand and protect to the down side. it will be interesting to see as once they start to pull back and the other central banks start to pull back, what the effect is on the u.s. market. i suspect there might be a little correction but by no means do i think it will be a 10% or 15% correction. >> what's your sense of where we are in this correction mode?

you think we have a little more to go? a lot more to go? we have a lot of central banks meeting next week. that could create a lot of volatility given the state of the world. >> absolutely. if you're broadly focused, if your portfolio is really spread out and you follow what the advisors tell you, that's what you should be focused on. i will slant it back and bring it back to tyler's point, stock picker's year. we saw a lot of activists really get on and beat the drum for the activist positions that they were in last year. january was a great month, lot of big names hitting the tape there. you will see more of that. if you do your homework, you will be rewarded. find the companies that are underperforming, that are a little sluggish to change, maybe they need a shakeup on the board. that's where you will get some return and you will be a lot safer whether or not that bottom fills in, whether or not that volatility hits. >> thanks, guys. good to have you with us. when we come back, three of the biggest winners on this volatile day. we are only down 70 points now on the dow. ce, there was a man who found a magic seashell. it told him what was happening on the trading floor in real time.

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the s&p looks like it's going to move into the green. computer sciences, tyson foods and jds uniphase, big percentage winners on what is a volatile day today. >> it really has been. we began with what a comeback and indeed, for the s&p, almost flat now. amazing week. that will do it for "power lunch." >> "street signs" begins right now. more often than not, when january stinks, the entire year stinks. well, let's hope history is wrong. stocks out with a whimper although a turnaround today and blame for the month being thrown around from everything and everyone from the fed to japan to the weather. maybe even to us. in this show, we will dispel some of the myths. by the way, boone pickens will join us on the keystone pipeline. back in april, it is time for the big game. the "street signs" stock draft. two teams, three players on each, three stock picks.