>> hi, everyone. welcome to "on the money." i'm becky quick. the most powerful woman in the world of money goes to capitol hill. what she said, what it means and what you should do. >> words of wisdom from three of the richest men in the world. warren buffett, charlie monther and bill gates. choosing your financial adviser, how to find one that fits and who do you trust?" on the money" starts right now. >> this is america's number one financial news program. "the on the money," becky quick. >> here's a look at what's making news as a new week on "on

the money." federal reserve chair janet yellen testified before lawmakers on the house and the senate and said though that the economy is improving it still has a long way to go. to most people that means interest rates will stay low for a long time to come and that's good news as far as stocks are concerned. the dow and the s&p 500 had their best day in three weeks on wednesday after she spoke. they were mixed on thursday and rose on friday. earnings season chugs along. pfizer beating estimates, disney bl blew out expectations and tesla foal its outlook and zil low was beat as well. ali banna fighting for its initial public offering this week and is expected to raise more than $15 billion when it goes public. it could be the largest technology debut in history a alibaba. burger king is announcing a newburgers at breakfast program that allows stores to serve up a

whopper when you wake up. 5,000 burger king stores have signed up for the program. >> a happy program, a chatty fed and worries about the bond market. what does it mean for your money? joining us now is michelle girard, chief economist at rbs and author of the new book, the leading indicators. zack, michelle, thank you both for join us this morning. this week we saw janet yellen testifying before the house and senate and she basically said the economy is improving, but it still needs help. the markets seemed to like what she said and do you agree with the comments and were either of you surprised by the market reaction? zack, why don't we start out with you? >> her comments were consistently with what her comments have been all along and ben bernanke's comments. the only thing that hasn't been consistent is the way the mar t markets have reacted to the changes in grammar and a comma going to fr one to the other and it speaks to a fragile economy which is looking at a rather a

little bit like deer in headlights from the 2008 and 2009 crisis. nothing is particularly surprising. the fed has said they will have an extremely loose, accommodative, easy, supportive policy and not quite as much as it has been in the form of the bond buying they've been doing, but either than that, that's what they've been doing and that's what she said and the market seems to have a hard time fully digesting that. >> we did see the markets enjoy what she said this time around, at least the bulls. were you surprised by any of it? >> if it seems like she's contradicting herself at all, the fed still needs to be providing support it's because she is in some ways trying to thread a needle. on one hand, certainly she wants to acknowledge that the economy is improving because it is and it also certainly then justifies why they're scaling back on buying, you know, treasurys and mortgage-backed securities every month and the balance sheet. they have to justify the papering and they don't want to

sound too upbeat because then of course, the markets might worry that the fed is getting closer to raising interest rates and they might hike rates sooner than they were suggesting. so that's why they're trying to suggest while they're happy with the improvement they still think there's more work to be done. i think, too, this is the first time we had a chance to get her take after a very strong jobs report and perhaps to some extent there was relief that that strong jobs report hadn't changed anything for the fed, hadn't gotten them thinking more about tightening and maybe that explains also some of the relief. >> michelle, do you think there is a moment of truth here? you mentioned she's basically trying to thread the needle by giving everything to everyone. do you think there is a moment of truth when the market wakes up and realizes oh, my gosh we're going to see higher rates or do you think it's baked into the market? >> i think that the market is thinking about higher rates. if you look at short term, you know, indicators and, the futures market where you see people betting on when the fed will raise interest rates and the levels are consistent with what they've been suggesting

that we'll see the first hike and maybe the middle of 2015 and a very gradual increase in terms of short-term interest rates beyond that. >> zack, there has been some concern over whether there is a bubble in the bond market and why do you think yields have been so low on the long end of the curve? some. >> the whole bubble question which is ubiquitous and which seems to be asked any time it goes up and frankly, any time anything goes down more than what we would have expected and it speaks to more of that market psychology, right? the bubble hunting is -- i think understandable because people feel like they were burned in 200 and 2008 and 2009, but i don't think is indicative of we're missing risks and i think the fact that rates are going to stay low for a very long time and whatever we think normal is based on the 20th century, that doesn't necessarily constitute what we are going to return to. we could be in a very low interest rate environment as it

has been since at least 2006. we can be that way for another five years and we can be that wi for ten and we can be that way for as long as we're talking about it relative to the 20th century. >> another example of a potential new normal. janet yellen said one of the biggest concerns is the slowdown in the housing market and that's been surprising what do you think is behind that? >> it isn't just weather. that's what we're starting to understand is the weather has gotten better and the housing data hasn't followed along suit. i do think there is some fundamental factors working against housing and it the continued headwind which is doesn't mean the recovery won't continue. it just means that it will continue to be a slow grind. we still have very tight mortgage conditions and it's hard to get a mortgage because lending standards are tight and one of the newer themes that everybody's been focusing on and the difficulty for many first-time homebuyers to secure the mortgage because of the student loan debt that they're still carrying. it's also -- we're seeing

affordability come down because interest rates have moved down a bit and home prices have rebounded which is a great thing for sellers, because it does make it more difficult for semisome to be able to buy and those are the kind of issues that won't derail the housing recovery, but will suggest that we may not see the strength we saw in 13 and we may not see the double digit price gains on a year over year basis in 2013. >> long term, how do you view the markets? are they fairly priced? let's talk about stocks. >> stocks kind of like housing you don't want housing to lead the economy. i'm want sure you want the housing to lead overall activity. you're investing in the most potent part of our economic lives. namely larger companies that can operate globally, that can pick their markets and don't bear a lot of the costs of being alive. they don't have to build roads and they don't have to educate children and they don't have to care for the elderly.

>> i don't think there is a reason why stocks and equity markets in particular can and should do better than the national economy. whenever anyone says we're chugging along at 2% or 3% growth why are the markets up so much? they're up so much because the dynamics are not the same, and i think we need uncouple things in a way that they're not as familiar in the past and should be absolutely typical going forward into the future. >> michelle, your thoughts on stocks? >> i will just say that i don't think that we're looking at equity levels purely because the fed is adding all this liquidity and that's pushing stock prices higher. ity think the u.s. economy is on solid ground and isn't growing at a spectacular rate, but it is on solid growth fund and companies have gotten themselves in a position to be able to make money even in a relatively subdu subdued, economic environment. i think there are fundamentals that are supporting the equity market and i think that's something that sometimes gets overlooked to hear people saying it's all because of the fed and

i just don't think that's the case. >> michelle and zack, thank you both very much. >> thank you. up next we are "on the money," gates, buffett and munger, they might be worth half a billion between them, but it's only a penny for their thoughts. y find out what these three old friends think and what they talk about behind closed doors. >> i'm all by myself in this. i feel very lonely? later, getting your money questions answered and is the adviser worth the price? how do you find one you trust and what can they do for you. as weed this break take a look at how the stock market ended the week.

>> ever wonder what billionaires talk about when they get together? we sat down with three of the world's richest men who also happen to be members of the board of directors for berkshire hathaway, warren buffett, bill gates and charlie ung munger as they talked about energy and shareholder activism. >> if you have thousands of corporations some of them will be poorly run and of them will be run in a very self-interested man are by the managers upon. what's the correction for that? and activism can be a correction, but there are times when change is needed at corporations and they're not going to do it themselves. >> charlie, i would love to get your pon what you think about hiabout high-frequency traders. is the book right that they're skimming off the top and it's a fixed market? smo well, of course, they have an advantage, cleverly obtained and think, it does the rest of

the civilization no good at all. it's functional equivalent of rats into a grannery. no, i don't like it. >> warren, bill, do you agree or disagree with charlie? >> it doesn't seem like it's much value added, because it's not when twrou get, you really need the liquidity and it's not guaranteed to be there. so i'm not an expert on it, but it seems like a strange source of profit. >> it's not a liquidity provider. it may create more volume, but that's not the same as being a liquidity provider. here they gained a natural advantage by speed just by figuring out how the system worked and getting there first and that adds nothing to gdp or a real output of goods and services. and for the small investor, they've never had it so good and

high frequency trading i don't think costs them a pen. >> let me ask you very quickly about the situation in ukraine. how much time do any of you spend thinking of that? how concerned should we be from a geopolitical risk standpoint? >> we have a global economy so when you have disputes between countries like european -- europe's dependency on russian gas, you sometimes will make political points you'll sometimes take economic pain and i don't think it's going to get terrible, but it would certainly be high on the list of concerns right now. >> you are no longer the largest shareholder of microsoft. you've been selling down that stake. why is that? >> i -- i sold for over a decade the same number of shares every quarter. that plan lasts through the end of this year. you know, i'm going to retain a lot of microsoft stock, but the

u.s. treasury has done well. >> are you excited about the new ceo? satya nadella? >> yes. he's drawing on a broad set of people in the company to get them to rethink how can microsoft move a bit faster and really distinguish ourselveses with things like office 365. >> let me ask you all about energy policy, and i come back to this, charlie, because you've said things in previous meetings and maybe it was two or three years ago that kind of changed my thinking about it, just the idea of whether or not we should be exporting natural gas and some of our other natural resources. your idea was that we should save it all. >> yeah. i'm totally against exporting natural gas. i don't like oil to be exported either. i'm over using up our oil more slowly and discovering it more slowly. i'm all by myself in this. i feel very lonely. >> why is that it that you think we shouldn't export it? >> i think this stuff is ut lear

precious. >> warren do you agree with charlie? >> if i were in charge to run it for the next 500 years i would want the ability to produce energy to provide for national defense because i would not be dependent on the rest of the world in that respect, but otherwise and like i say, i had a responsibility for hundreds and hundreds of years i would use the other guys'. >> with the stock market hitting new highs, if that concerns any of the three of you, if things are starting to look expensive at these levels. bill, what do you think? >> relative to interest rates, equities are still a bargain. the central banks are making sure that's the case. they're trying to stimulate these economies as best they can. the fact that it requires the gas pedal being pushed to the floor as much as it it does is an amazing and a scary thing. >> charlie, what do you think? >> i think what bill gross calls the new normal, the stocks might

not do quite as well in the future as they did in the last hundred years, but that doesn't mean the mungers will sell the common stocks in an effort to buy them back cheaper. >> warren, how about you. >> their option their own fixed dollars and i think it's clear that you own equity. >> many thanks to warren buffett, charlie munger and bill gates. >> up next, we are "on the money." need help with your money? how do you find it and who is the right person to help you? sharon epperson joins us with some important tips. by the way, you can find us on facebook. facebook.com/otm.

>> if you have questions about your investments and you don't know where to turn, a financial adviser might be just the ticket, but are they for everyone and what do they cost and how do you find one who you trust? sharon epperson joins us with more. how do you know if you need a financial adviser? >> my view is most people need a financial adviser and you need a third party to say this is what you should do and help you citi on track. a lot of people say they think they can do it themselves and the reality is sticking to your goals and reaching your long-term objective, a lot of those people aren't doing that part of it. >> how do i go about finding a good financial adviser? one i might trust and what should i be on the lookout for? >> this is like any other

professional that you use. you will probably scout around and find the best doctor. you might talk to two or three people and get referrals and do the same thing in terms of finding a financial adviser, ask your friends and ask colleagues and people that have been successful in their finances. you can go to the financial planning association and one of the trade organizations for financial advisers or the national association of personal financial advisers. >> one of the questions that come up is how are they compensated? are they making money just because they're pushing me a particular product? >> they make money in different ways and that's a very important question to ask to know how they're compensated. they can be paid an hourly rate, a flat fee or a commission based on the securities they sell or the products they sell or they can be paid a combination of a fee and a commission. >> do they have to tell me all that? do i they have to tell me if i ask them or not? >> you can go to the securities and exchange website and look

them up and look for something called a form adv part 2, in that they have to list their fee structure. >> one question i always have, personally i put my money in index funds and that's what warren buffett has been preaching of and he's even suggested going a vanguard fund. what's the difference between doing that and finding a financial adviser? what benefit is it? >> when the market is doing well. that's perfectly fine. a lot of people take that approach, but when the market is not doing well and you're in a weak market, sometimes you do want someone who might know something about picking stocks and who can can do the homework for you, then you might want to do that. the other thing is as you get more assets you may want want to be in stocks and fixed income stocks and bonds. you want to have alternative investments and most investors long term are going need that and finding those asset classes sometimes are very difficult for individual investors to do on their own and getting some financial and some professional advice to do that is another reason why you may want to hire

an adviser. >> another thing i think about it, i may not need it now because i'm a long-term investor and as you get closer to having your kids go to college and you get closer to having retirement coming up and you want more advice? >> name something very important. you just named several goals that you have and what a good financial adviser should do, i think they should be a certified financial planner and have the cfp designation so they can help you mrafsh for various life stages whether that is saving for a child and how do you start saving for college and how do you pay for college when you're there and how do you seave for retirement and estate planning. all of those things can be held by the financial adviser. >> what's the difference between a cfp-certified financial planner and it's someone who has gone to the financial planning board of standards and gotten that designation and that is the special designation that says if

they can plan in all of these different areas and not just a broker who is going to sell you various securities and not just a financial adviser and a financial adviser and someone that can do long-range plans for you. >> sharon, thank you. >> sharon epperson. up next on "the money and a look ahead at the week ahead and making money and sometimes it's not as easy as it seems. we'll have that when we return.

>> for more on our show and on our guests you can go to our website otm.cnbc.com. follow us on twitter @on the money. here are the stories that may impact your money this week. major retailers, macy's, jc penney, wal nart? nordstrom reporting with cisco. retail sales for the month of march are due. facebook founder and ceo mark zishgberg will be celebrating his 30th birthday. that's right. this is a guy who gave away a billion dollars last year. and we'll see how they're faring with the consumer price in april. on friday housing starts are out and veteran journalist barbara walters will retire from television and say farewell on "the screw." view. it's something to sneeze at and

it's less than what they expected to go for. testing the annual spring auctions of impressionist art. they failed to reach their minimum price and is this the sign of a bubble bursting? the auctions for red hot's contemporary art are this week so stay tuned. that's the show for today. i'm becky quick. thank you so much for joining me. last week we promise toed bring you allen alda as a science educator and we do hope to have him at a later date. next week, when you are unable to care for yourself. long-term care insurance, do you need it. we'll talk about that. each week, we're on the money. have a great week, and i'll see you back here next weekend.

>> narrator: in this episode of "american greed"... enter the dangerous underground world of new york sandhogs. these tunnel-digging construction workers hire melissa king to ensure the safety of their retirement funds. but the only one she takes care of is herself. >> one check for $50,000, another check for $50,000 -- three checks for $50,000. >> narrator: she steals millions, then uses the loot to build a life of luxury. >> this woman just burned through all the money like it was monopoly money. >> narrator: and later, meet a western con man.