and hope he's getting care. >> good luck. fashion show benefiting the humane society. >> yes, absolutely. >> walking down the caught walk with a little cat walk. dogs are hitting the caught walk. see the irony. >> try to stop in. >> good luck tonight. >> thank you very much, and thank you, robert. thanks for watching "street signs" as well. welcome to the "closing bell." i'm kelly evans here at the stock exchange where today any close higher for the dow or s&p 500 will mark an all-time high. i think as we stand here, this is an all-time intraday high. >> so far so good, and we're watching those markets and these stories as well. i mean, the stock market may be going strong, but what about houseing? that's what a lot of people are asking. our own ron insana wrote a piece for cnbc.com that's been burning up the web. he said weakness in the housing market, if it continues, could

change the game for what the fed koss or does not do, and ron will be here to make his case and we'll talk to a famed pen warden school as well. >> jeremy segal. want him to weigh in on that as well. warren buffett is ready to scoop up kellogg. there's speculation buffet could make a play for the maker of corn flakes and so many other household names. kellogg's market value approaching $20 billion. how much would buffet worth $50 billion in cash offer, and why would he be interested in the company? a full report coming up. >> the question is the kellogg brand the kind you could run with a ham sandwich? that's what warren buffett has said in the past. >> i don't think warren buffett is a cereal guy. i think he's more of a coke in the morning kind of guy, coca-cola. >> and dairy queen brands. >> yeah. >> also a warning for the retirement fund, the target funds that change the investment

mix automatically the closer you get to retirement? well, they may be hurting investors who are saving for retirement more than helping them. that's what a new study says, but not everybody agrees with that study's conclusion. it's a story that could affect millions of savers, and we will hear from both sides of this very, very important issue coming up here. >> yes. >> now, again, here's where we stand in markets. it will be another banner day most likely. don't want to jinx it here. the dow has added 25 point. 1670 is the level. the nasdaq a strong day yesterday and giving up 1/10 of 1%. down about five points right now. finally the s&p 500, roughly flat, up two minutes, we've kissed 1900 today. >> here we go. let talk about in today's closing bell exchange, amy wu from rbc capital markets and david kudlow and todd salamone

and kenny pull cary is ready to go on the big board floor and rick santelli, of course, joins us from chicago. kenny p., yesterday's big rally, a one-day wonder or what happened? >> one day. the market, you can feel it's just digesting yesterday's move, teased 1900 and broke through early on and have been struggling all day with it, right? today's eco-numbers were not so -- not so exciting, not completely disappointing, but not nearly as exciting i think as some people thought they would be, so the market is just taking a breather. not a lot of volume, just to tell you there's not a lot of commitment up here. people are going to continue to wait as the week goes on. we get more macro data that's two, you know, industrial production, capacity, all that stuff. >> i was going to say retail sales is what he's talking about, flat for april. high expectations. april didn't have the weather concerns that january, february and march is and they still came

in flat. >> actually i was going to ask you about the fact that after the retail sales data, some of the business inventory data, the first quarter looks worse and worse, second quarter may be a little bit better. why is it that the bond market is taking cues from the past, not from present or future? >> well, i don't think the bond market is taking anything from the past. i think the bond market is thinking, oh, my god, good weather kept shoppers away. listen, the seasonal adjustments take care of the winter month. the fact that april was minus 1/10 on the control group is what the bond market concentrates on. how do we know that, because 5s, 10s and 30s as you look at intraday charts, each down five basis points. that parallel shift didn't due to geopolitics or weather but due to a weak retail sales report, and i think that that really presents home exactly what is motivating the bond market and other issues like 75 basis point lower french ten-year than ours or 120 base

points cheaper bund yield than ours. all of these things will continue to keep interest rates lower than many would suspect and i know that you're going to be talking about housing today and what the fed may or may not do five and a half years into zero interest rate policy. if that can't fix, it maybe mel watts' principal reduction will work. let's see, we tried that four and a half years ago, didn't get far. one question for the group. why does any taxpayer want three times the exposure and a conforming loan in california than in north dakota? is that fair? >> anybody want to take that? david, what do you think? >> i'm sorry, rick. that question was again? >> you have an upper limit on a conforming loan that's much higher in the likes of san francisco than it is in rapid city, and i don't understand why i subsidize sunshine in states where houses cost more, and in this case where the government has already nationalized all the housing industry and there's no

private label mortgages. i don't understand why we don't see more ire against this scenario. >> in terms of where interest rates are today, what that means for stocks and what that means for bonds, i think we're in a long-term secular bear market that we called last may that will continue even though we've had a cyclical bull market in bonds the last three months, and i think we're in a long-term sick lar bull market for stocks that will continue to go on making new highs again. investors need to rotate into large cap, into value, but this bull market for stocks will continue to go on. >> even though, david, i mean, the point we keep harping on is job growth is so -- it's getting better, but it is just lumbering along so athemically. the housing market, one of the real staples of the economy, just not there.

a lot of the things you usually see leading us out of recession, just not happening right now, and yet the stock market continues higher. >> well, so both of those, the jobs numbers, the jobs numbers we've had and housing, two critical legs of the economy, exactly right. jobs, 288,000, pretty good last month. we'll see if we can continue at a plus 200,000 pace. as far as housing, you know, the concern there is exactly right because it has two affects on consumers and spenders. consumers, spenders and on the markets in general, investors, and that is we know that housing can be a significant contributor to gdp as much as 1% and 1.5% if we maintain a good clip. that's now coming into question. the other thing is the wealth effect. people just feel better when they feel like their house is worth more. they buy more and spend more and consume more. >> right. >> so it is very important what happens to housing, and if housing does stall here, i think

that there's problems for the economy and for the markets. >> amy wu, you have your finger on the pulse of market sentim t sentiment. what's going on here? we get this herky jerky back and forth. we keep hear value is supplanting growth. what do you see happening right now? >> hey, guys, well, from my perspective on the options side i think we're actually in the reach for upside. you're seeing that in the options market even as the intraday moves are pretty herky jerky like you said. the volatility is still is coming in on an overall level. you see people starting to implement vix calls. you see people starting to implement energy upside, financial upside, but i think there's two tales right here that are fighting with each other is volatility is getting low. people are using it to reach for upside, but we're now enting the summer months where people tend to sell volatility to collect income. i'm not sure yet which one will win out, but i think there's real two forces at work in the

options market kind of giving the battle to where the stock market will go next. >> and todd, you make an interesting point here as well which i wanted to bring up which is the parallels between today and 1994 and the stock market space, it's interesting. i understand some of the concern that's out there with the retail sales report with housing, and i look at an nfib survey which is looking at its highest levels before the recession. consumer confidence at a six-year high and wages growing at an annualized rate lately and what looks to be a pretty good snapback in gdp, adding nearly 300,000 jobs in the u.s. economy, and i wondering are we gearing up for a moment, forget what's happening in the bond market for a moment, but are we at a moment like 1994, potentially like 1994 here today, todd? >> it's interesting because 1994, first quarter, just like this year, we had some issues in the stock market. this year obviously it was the small caps and the pullback, and we've had a little bit of it --

it's been overused probably. i've seen it all over twitter about the divergence between small caps and large caps. back in '94 the small caps didn't bottom out until june whereas the s&p bottomed in april, and -- but 1994 was a trading range, and, yes, we could see that this year. one index i'm looking at is the wilshire 5000 which really captures the entire market. we're right up at that 20,000 millennium mark, first time ever. hit that back in march. have essentially grinded sideways ever since. that said, i think for the bulls, what you guys were just talking about, all the concerns out there, whether it's housing, the fed, geopolitical, russia, this market has really maintained some stability throughout this, and what we find interesting, short s&p component stocks, probably about -- roughly about 15% above the 2012 lows when the s&p

finally did correct. there is some caution out there. amy was talking about the options market. we're seeing almost no proput action on the vick. put volume is really low. no one is expecting a decline in volatility so we're really interested in this contrast between price action, especially in the large cap, s&p and hitting highs, caution, doubt, even among equities. we're seeing bearish bets against individual equities versus bullish bets. they are at the highest level since september 2013, and keep in mind this is in the context of a growing number of concerns, geopolitical, domestic and yet the s&p around all-time highs. so a contrarian perspective. >> what's interesting about 1994 is in 1994 value led in 1994. that's what we're seeing now. that's what's important now is that investors are rotating from the high momentum stocks, small-cap growth, growth in

general, to value, large-cap value. those are the plays. >> we've really got a tailwind with interest rate environment. we had a 200 basis increase with interest rates, and i believe that was a fed and maybe a surprise hike. we really do have a fed that's supportive of the market. >> fed policy was very different at that time. thank you for your thoughts on that. thank you. >> always seems to happen in the years that end in 4. we'll see. >> the numbers divisible by 4, oh, and an election year, that's right. 48 minutes left in the trading session. the dow up 18 points. any positive close, another new all-time high on a closing basis and same thing for the s&p in its upper fraction. >> more ahead in the markets, plus green mountain surging near a 52-week high or coca-cola upped its stake in the coffee brewer. should you follow coke's lead. >> and is warren buffett eyeing kellogg or not? the stock has been jumping over 10% this year. much of that on speculation of a

possible deal. we're going to talk about what the oracle of omaha ha may be up to coming up. >> and straight ahead. ron insana sounding the alarm on the housing market and how it could rock the fed policy. go check this out. ron is up next along with wharton economist jeremy siegel when we come back. ♪

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welcome back. mixed day on wall street today. this feels more like what we've had recently. yesterday, boy, monster rally, everybody was higher. not today. the dow is up 13. the s&p up a fraction. if they close in higher territory, an all-time high. small caps negative. we're getting the kind of divergence again that we've seen recently here >> even as we were noting the intraday highs. now the question is will the dow go negative here as we have 45 minutes still to go. turnaround tuesday. >> here we go again. >> with all the green arrows. >> for quite some time the fed has been focused on two factors. employment and inflation. mandate after all but in fed

chair yellen's latest testimony things changed a bit. mentioned housing pretty prominently. >> and according to the ron insana, his piece right now on cnbc.com is getting a lot of attention about that. it says here mr. insana joins us right now. >> yeah. when did you start calling me that. >> just now. >> also with us, of course, is wharton school's jeremy seeingen. you don't think housing alone would cause janet yellen to do anything different? >> i think it's the whole economy. of course, housing is an important part of the economy, but i don't think housing alone, if it disappoints, would do it as long as consumer spending and many other investment spending were strong enough. >> right. >> it's an important component, but i don't think it's going to be an overriding factor. >> ron, do you think, a, the housing market is in bad shape right now, and, b, it's going to get worse? >> certainly it's bounced, you know, considerably off the lows.

we had a five-year bear market in real estate as everyone knows. what really struck me is fed chairs very rarely single out particular variables unless it happens to be on their mind and on the mind of the fed more broadly, and i think when ms. yellen last week talked about the protracted slowdown in housing it added a new dimension in policy. nothing different than what jeremy is saying other than there are some things to be done here. lending standards, many bankers stay, are still too tight for people to either refinance or get a loan, and the fed is still paying 25 basis points on reserves held at the fed by the biggest banks. there are ways to push back. >> why would this come from the fed and not the fha with mel watt finally speaking about it, about a series of things that fannie and freddie could do. >> as i discuss in the piece. not just the fed. the fed does oversee the entire lending community and the fda and fdic and, of course, controller of the currency all have a say in how lending

standards are set so i think in concert there's something that should -- to be done here. i argue that the fed would taper the taper. i doubt that's the result, but the fed could do some things that would loosen policy and make capital more available to home owners who want to get into the game. >> jeremy, as you would teach your students at wharton, i would imagine, housing typically will lead us out of the recession. it's employment numbers that will lag a bit and this time around, housing is just not there. why is that? why do you think we're still-language lagging in that key component of the economy. >> well, i think ron is right that -- i think lending standards are too tough. i think banks were shellshocked from that what happened and what's strange in 2007, you know, they would lend anyone at prices that were 30%, 40% higher today, and now that there's so much reasonable relative income and relative interest rates, you know, they tighten up, and i really think that they are too

tight, and also on ron, you know, i've been one of the critics of the fed paying 25 basis points of interest. i think that helps mobilize those $3 trillion worth of reserves. i don't think it's going to happen though because, as ron mentioned in his piece, the banks are certainly depending on that income. you know, as far as the housing sector, we read all about the millennials and young people. they don't have the income or the down payment, and now they have to come up with 20%. >> wait, wait a minute. i want to be clear on this because we've talked a lot about this on the program and there's a lot of discussion in the community out there right now about whether in fact standards are too tight, because isn't it the case that you can get a mortgage in certain cases, depending on who is supplying it, the fha, whatever, with only in some cases less this a 10% down payment. your credit score does not have to be over 700. jeremy, in other words, should

we identify it if this is a demand side problem it's not one where the underwriters are getting in the way, simply not enough demand because many of the individuals trying to buy the houses are not in good enough financial shape themselves. >> there's an argument that debt to are being ratios and i've had this debate that debt is still too high and the consumer or buyer is still too levered. by the same token, if you talk to bankers, they are telling us that examiners don't allow us to make community loans. there are still constraints on lending. certainly we don't want to go back to the sub prime days when you're doing 125% of the value of the house, that you don't -- that you needed no income documentation. >> the liar loans. >> the ninja loans, no income, no jobs, pay option a.r.m.s, but there's a case to be made that credit is not flowing to folks who need it most and available

for some but certainly not those who would actually drive the housing market forward. >> jeremy, what now? what can we do to very vive the housing market here, or do we just have to wait this out? >> don't forget. we had the most severe contraction in 75 years to levels, you know, housing starts down to half a million, that the -- our demographers and economists tell us it's 1.5 million. we've gone halfway. we got up to that million. it sort of stalled out there. my feeling is over the next two or three careers it will grind higher, but, again, there are challenges. down payments are challenges. few fha loans that are available, and they are constrain constrained. and many of those don't have the income or the down payment to do it, but i think, again, as our economy improves, we'll see housing, and i'm hoping by year end we get back to a million and

a quarter, housing starts of a million three. >> very quickly. >> there are some constraints. if you're trying to finance and your home was under water, you had a discussion, kelly, i know you did the other day, the bankers getting bailed out but the average individual not getting help. there's documented cases of individuals not being able to refinance even though they have more than adequate income. their house was under water so there's that issue that was outstanding there. has to be a mechanism either by which the fed or others make housing more affordable in terms of getting legser expensive credit or being able to refinance out of the financial difficulties you might have. i think that's very critical and something that the fed needs to address. >> all right. gentlemen, good to see you. jeremy, as always. mr. insana, thanks for joining us as well. >> miss evans. >> we commend your article for everyone to read on cnbc.com. >> 35 minutes to go until the close. the dow is up 13 points this hour and any positive close will be another record high. the s&p just ever so slightly

higher and the nasdaq sheds 12. >> keurig green mountain is hotter that be ever after coca-cola raised its stake in the coffee brewer. our pros will debate if that stock is too hot to handle or if now may be the perfect time to take a sip. >> also ahead, what's the deal with the so-called target funds? you know they are in many 401(k)s, allows you to pick the time of your retirement and are they the vehicles of investment they have been billed as, or should you stay away? a new report offering mixed views. we'll get the pros and cons. don't go anywhere. making new york state number two in the nation in new private sector job creation... with 10 regional development strategies to fit your business needs. and now it's even better because they've introduced startup new york... with the state creating dozens of tax-free zones where businesses pay no taxes for ten years. become the next business to discover the new new york. [ male announcer ] see if your business qualifies.

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welcome back. here's how we look, a little bit of divergence across the index. nasdaq giving up 12 after a sharp rally yesterday and the dow and s&p are ever so positive. >> we are watching the big movers today. what's moving? >> a lot of moster. mckesson is moving higher after posting better than first quarter results and helped by the strong distribution operations. mckesson up 3% on the session. microsoft is another winner as well, gaining ground after it slashed its price on its xbox 1 without kinnect, and the online entertainment apps like netflix will no longer require a paid xbox live subscription. up 1.5% on that news. we do have a loser though in whirlpool following after the government reported the

electronics store logged a 2.3% decline in march. they are trading down on the news, almost 3% and finally let's end with keurig green mountain moving higher in that coca-cola raised its stake to 16% from 10% making coke the largest shareholder in the company. keurig getting quite a boost, up more than 8% on the session and coke is also higher on the day, up by .75%. >> guys, sheila, thank you. i mean, coke must see some upside in green mountain to take that kind of a stake in the company, but does that mean you should be buying it right now? >> it's time now for a stock brawl. mitchell pineiro and also our bear joins us. great to see you both. mitchell, make your case. >> a stock you could have bought at 90 and now it's at 120. there's plenty of upside.

we see a stock that will see earnings of $4 next year, $5 in '15 and $6 in 2016, and 30 multiple on $6, a $180 stock, 50% upside from current levels so we're a buyer. >> actually you could have bought it for 60 six months ago, steve, just too expensive for you now, come too far too fast or why don't you like it? >> i do think it's too expensive. i'd be careful following it. management who has been following frankly for years. the stock has majorly underperformed and getting the green mountain, my biggest problem with green mountain is input prices. green mountain has shot higher but so have coffee prices and if you look at the etf that's just about doubled on the year. that is great news for my cousin juan valdez but that's terrible news for the purveyors of coffee most of which are trading very poorly if you lock at dunkin'

donuts and star ducks and i think this is the outlier. green mountain only because of the potential m & a, and if you're lucky or smart enough to be long you take some profits. >> is this just an m & a play, or will these be in our kitchens for good? >> the stock is reacting to that but this is not an m & a play. this is a disruptive technology. keurig has found a new way to get into the consumer's household. coca-cola wants to play on that so they have a stake in it. they will help them develop the new cold system if you b.u. not an m & a play, an earnings play, cash flow play and a real true growth stock and it should get a growth stock multial. >> what about steve's point about the margin squeeze because of much higher costs for coffee right now? >> there's ten cents of coffee in a k-cup. if it's up 70%, green mountain,

starbucks, folgers has to raise the cost of a k-cup by seven cents, so seven cents you know on percentages, it's 60 cents a box, really not a show stopper whatsoever. >> just real quick, steve. some have made the case in the soft drink industry, if you will, but, you know, people are never going to switch full time to these kinds of devices because the water quality isn't there and the taste is going to be a little bit off. is that part of your case for being against this. >> i've never used them and haven't researched that part of it so i don't know. it's been an outperformer. i think purely because of m & a. >> all right. thanks, guys. >> thanks, gentlemen. >> see you later. >> fascinating, nevertheless. look at a soda stream with the market cap at 800 million. coke has already spent $2.5 billion just spending into green mountain. >> the convenience factor is a big part of that, and the quality has come up. my daughter is a big devotee of green mountain of the keurig cups, so i have witnessed that,

though i stick with my french press, i must say. heading towards the close, 30 minutes left, not that you asked, the dow is up 19 points right now so we're hanging on so far. any positive closes at a new all-time high, the s&p iffy. up just a fraction at this point. >> is it deja vu all over again in silicon valley? there's more talk we're in the throes of another tech bubble, but is this anything like 1999? a special report coming up. we'll talk to some top market pros about how to avoid getting burned this time around. >> plus, when warren buffett looks, stocks jump, we know that, so is kellogg on warren buffett's shopping list right now. some wall street pros think so. the options market has been going crazy. a look at what buffet could be up to when we come back. cars are driven by people.

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welcome back, just joining us, this is a look that's very familiar, a lot like what you've seen in the last week or so, yesterday no withstanding, the tow and s&p, any positive close, new record high, the nasdaq, the broader russell 2000 trading lower again today so we're back to that question of are you going with the value, are you going with the growth stocks is this where's this market going here and why?

>> yes, and kellogg up over 10% this year amid talk it could be on billionaire investor warren buffett's shopping list. >> dominic chu has been looking into the story for us. bring us up to date. >> here at post six at ny sze where kellogg has made its mark, goldman sachs is the market-maker for kellogg. what's interesting about this story from a consumer staple standpoint, one of the stocks that people talk about with warren buffett. loves buying the stocks where he noses company. it has cash flow and understands the business overall, kellogg is one of those companies that always demonstrates that bit of characteristics. it's interesting because if you look year to date for this stock there's been investors who have been thinking to themselves maybe somebody else comes in and either merges with them or takes them over. the stock is up about 11%, 12% just so far in 2014. what's more interesting is the options market because we don't go into the technicals about it because the bottom line is a lot of investors are using the options market to take bullish bets on where kellogg is going.

that might be behind some of the move. i spoke to the chief market strategist over at t.d. ameritrade think or swim, the options trading platform, we've seen interest for the bullish bets, call options on kellogg start to pick up steam and they are trading, at least today, three times the bullish bets, three times what they normally would, so there's a reason behind that. options prices for the upside, for kellogg right now are trading relatively cheap, so rather than go and buy the stocks, a lot of traders are use the options market to get that long upside exposure, so when it comes to kellogg, maybe a buffet candidate, maybe somebody else comes and looks at them. obviously nobody knows anything with regard to the future just yet, but that's the reason why kellogg is so much in focus for a lot of investors mabanking on positive action. >> investors with completely different views. scott rothborg and mark haika,

thanks for being here both. >> thanks for having me. >> would you be in favor of warren buffett going offer kellogg here? >> well, when you look at the characteristics of kellogg's, it really fits into what warren buffett likes to see, companies that generate cash flow, companies that are very well known to the american consumer. they fit well with heinz or coca-cola, companies he owns through bethaway or has large positions in, and when you look at, you know, warren buffett, the market that we're income the value-driven market, is the kind of market in which he happens to excel so it won't be surprising if he takes a good look at kello kellogg's or for that matter one of kellock's peers and that would be general mills. >> mark, you're not buying this. you don't think that kellogg fits the mold, right.

>> he's not going to buy kellogg and all the option buyers will lose their money. there's only one real good thing about it and that's for the amount of revenue it produces, 14 billion, 15 billion, they produce 1.5 million at most in cash flow, free cash flow, that's good so you'll have to pay 31 billion for 1.5 billion in cash flow. that's on an enterprise basis. so, you know, that's just way overpriced and also the some's gone nowhere for the past ten years. i think it's averaged like 5%. i just did the numbers. for the amount of revenue it produces, okay, great. it produces a good amount of cash flow but you're basically paying for it. if i was an option player i would sell the calls instead of messing around with going long the calls.

also, you know, buffet doesn't leak any stories so i don't know where any of this stuff came from. >> yeah, that is unusual for us to be talking about a potential warren buffett deal. usually it comes out of nowhere, scott, and -- and it becomes a complete surprise. what about mark's points? yeah, products aside, that may fit his m.o. but what about the performance of this company and especially the valuations of this stock right now? he's a classic value invest or. >> that's correct. >> look. kellogg's is the kind of company that will boor you to tears. you'll look at a company that will grow earnings 6% to 7% a year and pay a dividend 2% a year and those are the companies that warren buffett will look for. >> typical west coast -- >> why would you pay $31 billion

and that's without a premium for just 1.2 billion or 1.3 billion in free cash flow, and also why would the kellogg's shareholders agree to this. they will give up their dividend to be part of buffet's group. he doesn't do anything for the shareholders, you know. >> that point is true. >> go ahead, go ahead. that point is true. they would be giving up their dividend. not saying that this is the perfect stock, what price he would pay for it i'm not quite sure. you're throwing out 31 billion. it could be less, but, again, this is what is in warren buffett's kind of zone of comfort, and as a result he can be very patient. he doesn't need instant gratification. remember -- >> another loser stock, plus minus a few years. >> another loser stock, just like coke, you know. warren buffett's biggest investment is coca-cola. big loser on his balance sheet, and if he were to buy this, it would just be another big loser. coke has actually gone down for

the past 20 years. >> i wouldn't exactly be calling warren buffett a loser and what he's done over the course of his life time being a loser strategy. >> i didn't call buffet a loser. >> certainly someone who monksful ofs like i do professionally understands that not everything in your portfolio is going to perform immediately, all right? and over periods of time, some companies will perform better. >> you know, look, coca-cola is warren buffett's single largest investment, and it has gone down in value for the past ten years, maybe even the past 20 years. i mean, come on. i feel sorry for the kellogg's shareholders if he were to buy this stock from them, all right? >> all right. >> gentleman, we've got to go. made compelling cases on both sides. thanks for your insights. warren buffett and kellogg. >> mark, by the way, had also called berkshire a conglomerate

without any glue. not a fan. >> he was hilarious. that great stuff. good, good insights there. heading towards the close. >> 15 minute to go. >> we're up 23 points on the dow. any positive close on the industrial average will be new all-time high. moving on. the nasdaq has been lagging the major averages again today. se seema moed mody will check out what's ailing the text. >> after the bell, viral video never supposed to be released. jay-z and beyonce's younger sister on a tape having an altercation and the hotel where this happened is another video that got out. is that another example we should assume that nothing is private? that's later on "closing bell."

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welcome back, the dow and s&p 500 are trying to lock in a second day for the record books. right now the dow is higher by 22 points and the s&p barely higher by a point and, again, we're looking at all-time highs. >> seema mody is over at the nasdaq market sites where we're seeing red arrows again today. >> just when we thought things were starting to look up for the nasdaq, we're lower on the day. here's the things, a couple of bright spots to take notice of. keurig green mountain topping

the list on the nasdaq 100. coca-cola exercising its option to increase its stake from 16% to 10%. other in the tech sideways. tech names lists here, s&p tech index still flirting with a flat line, because the biotech index lower. a notable gain to the upside. you can see regeneron one of the big names weighing on the index and the russell 2000, once again underperforming. jonathan krinsky saying it really needs to clear that 1160 level to turn the medium term trend back to bullish. what's more the general thought a lot of traders are taking note of is the divergence between large cap and small-cap stocks, something that traders are watching closely. kelly and bill. >> thanks very much. 13 minutes left in the trading

session. dow in all-time high territory if there's a green arrow at the close. >> and a discussion of whether we're in a new tech bubble, a point of contention on wall street and silicon valley. we'll hash it out with top money pros in the next however the show. don't miss a moment of that. we'll be right back.

. about ten minutes left here and the mixed market continues. the dow is up about 17 points, the s&p up a fraction and nasdaq down 13 as we head towards the close. >> join us is aaron gibbs as well as scott rothman from trading the street. >> aaron, talking about new closing highs. a lot of people focusing on the internals of this market saying is volume strong enough, participation broad enough? >> still the wringing of the hands. >> what do you guys think? >> we were just looking at the differences between the small caps and large caps and when you really delve into it there's definite lay flight to quality. when you look at those high -- consistently high earners, consistently high dividend yields, those are the guys that are driving the upside and the really high pes and more

volatile earns, the ones driving down particularly in the small caps. you can really see a huge difference. >> where the russell 2000 lives. >> to have such extremes, basically, when we look at s&p quality ranks, the a-plusses are actually up. they are positive versus all the others that are down. it's unusual to see such a big divergence. what do you think is going on here? >> you've got the ipo markets off to a great start. a little cooldown of late, especially on the tech side. m & a is starting to heat up, too, and that will drive a lot of volume. a big sign of confidence, not only from the investor side. share prices are up and historically they decline. more importantly about boards and wanting to do deals and ceos wanting to do transactions, chasing growth, chasing alternatives, whatever the case may be. >> and it's interesting that you say that the acquirers are doing okay because the danger in this kind of environment might be

that companies get overinquisitive and shareholders are rewarding that. >> prices are reasonable valuations. strategic benefits are there. announcing good cost savings and having clear strategies for synergies and they are laying out the advantages of the deals instead of doing it for us, and notice when apple says for beegbeats audio, people scratch their heads or pfizer/astrazeneca, it all seems to work. >> mergers are doing well, basically the m & a activity is really up, but the consume, all of the existing stocks, that's where we're not seeing the really strong signals and a lot of, it we're still waiting to see the winter flushed out. not seeing the housing starts. not seeing the same-store sales and even now we're trying to merge march and april numbers to get a sense of what's happening and that's a difference of what we're seeing m & a deals in corporate america versus what is the consumer still doing? >> wall street versus main

street. here we go againing right? >> stick around. we'll bring you back here as we come back for the closing countdown and see how we finish for this closing tuesday? >> after the bell, so much for privacy. this viral video of jay-z and beyonce's physical fight was not supposed to be out there for the world to see but it is. is privacy in america gone forever? that's just ahead. you're watching cnbc, first in business worldwide. new private sector jobs... making new york state number two in the nation in new private sector job creation... with 10 regional development strategies to fit your business needs. and now it's even better because they've introduced startup new york... with the state creating dozens of tax-free zones where businesses pay no taxes for ten years. become the next business to discover the new new york. [ male announcer ] see if your business qualifies. become the next business to discover the new new york. in a we believe outshining the competition tomorrow quires challenging your business inside and out today. at cognizant,

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three minutes till the close. want to compare today to yesterday. yesterday a very different feeling day than today has been, so here we go. two-day charts. this is the dow. big real on the open yesterday morning, we know that, and then it just held on to those gains. we didn't see the fade in the afternoon. we've seen recently here so a new all-time high for the dow. this morning a bump up and then sideways again. finishing the day about a 15-point gape which will be a new all-time high. what you're not seeing is a follow dawe through in the rally for the nasdaq or the russell 2000. nasdaq yesterday, rally, now we're pulling back. down 14 points back to 2129, and even the russell 2000 which has been the lag-yard recently, hovering towards correction territory, down 10% from its recent highs, it rallied yesterday, but today down 1% at

11:22. bag with aaron gibbs and scott. what do you make of the pullback of the secondaries? do you think this that's a sector that's ripe for picking right now. >> not quite. not seeing the earnings estimates go up as high as we would like to see and there were extreme valuations inside the small caps. the biotech firms in the s&p 500 are trading at about 174 times. they are trading at 17 times in the s&p 500. >> so much more expensive. >> and so we think that they could come down a little farther. >> are more inclined to go with what's growing, or do you think about the stocks that are being beaten down so much? >> a lot of investors are chaying growth and are excited about growth and something i bring up in class all the time. equity is pretty much a growth play and credit is pretty much a stability and safety. >> right. >> so, therefore, the 174 and the biotech, i mean, that's very expensive.

>> yeah. >> 17 for s&p and if you can be selective and buy good quality names, increasing dividends, strong earnings, good stories, then you can be successful. >> what about the twitters and facebooks? we had a money manager with us yesterday who said, hey, you know what, those who have been beaten down enough now that it's time to start thinking about buying those again. how do they look valuation-wise? >> for facebook they have been executing, and that one is starting to look a little more attractive for twitter. for us, still too early to make a call. >> not ready to pull out on that one. >> i would agree. >> facebook adopted a mobile strategy. >> yeah. >> twitter is still trying to find that transformation to give that longevity and personally i'm not bullish on. >> thank you both for your thoughts. thanks for joining us today. here we go. fractional gains for the major

averages, at least as far go the dow and the s&p, still higher, so record highs for both of those as we go out on this tuesday. does that continue, and what about the coming day tomorrow. stick around now for the second hour of "closing bell" with kelly evans and company. i'll see you tomorrow, kelly. >> and welcome to "closing bell." i'm kell evans, and it could be another record-breaking day on wall street. welcome to the second hour of "closing bell," everybody. the dow, nasdaq and s&p 500, divergence again. not surprisingly the nasdaq lagging in this case. did have a strong session yesterday. today giving up 13 points. the s&p though looks like it's going to finish positive by about a point, 1897 is the level there, and the dow up almost 20 to 1671 which would make this a new record closing high. let's bring in our very own

sharon epperson. our cnbc contributors and our own sarah eisen and dom chu is down on the floor. kick us off. does it feel like a record high? we'll go to dom in a second. guys, what do you think? sharon, what do you think? >> it doesn't really feel like a record high because we've been in this range for quite some time, and i don't think -- you don't feel the euphoria you might expect before we get another record high but it just underscores what a lot of investors need to be doing. yes, we've had a great run here, but this is an opportunity for you to really look at where you should be, where your goals are and take some profits where you need to rebalance as you think it necessary to reach your goals because if we all just continue to go on the high, continues to go in record territory week after week, we may not really be well positioned when it comes to an end, and we know eventually we can't keep create iing recor

day after day. >> a story of multiple economies, i realized there would be a new market high, blown away that the tech sector is having so much trouble. all the valuations are down so much. so much private market activity and still basically multiple things going on. >> dom, i think if you can hear me now. >> i certainly can. >> talk about the sentiment on the floor today. >> there isn't a real sense of direction. there hasn't been a flood of buy orders or sell orders. volumes have been fairly -- i mean, they have been low, let be honest, for quite some time now, so as you watch the markets slowly grinding higher, the sense that you get from a lot of traders here is there isn't going to be a move downward unless we see some kind of a catalyst, whether that's fed related, gee politically related and whether or not that's a real issue to the downside for the markets. now, if you get that kind of a move here, you look at some of the sectors that are benefiting today, overall the large caps did relatively well, if you look

at the mid-cap 400 or russell 2000 small cap index they severely underperformed the s&p 500 today, so as you watch the rotation, if there there is a move higher it might be driven by the fact that some of these are getting out of smaller and mid-cap name into the quality of larger-cap stocks, and that may be a theme you see continue until at least somebody says, no, it's time to get back. >> i like the parallel david was drawing at top of the three between today and 1994 when value stocks were also leading. i see guy adami crashing the show. welcome. >> kelly! >> that sounds like a record hi hello. >> if you look at today's intraday activity, felt more recordish when we topped 1900 and don't discount the fact that deal activity is up, sort of this frenzy of m & a activity. more than 1.3 trillion globally and that's our lifting animal spirits. not much in the way of economic data. retail sales disappointed,

upward revision in march, but you do have talk of pfizer planning another higher bid for astrazeneca, a blockbuster deal here. ackman pushing allergen. >> i wonder what we're seeing in europe and the outperformance there, the weaker euro, how much it's lifting all boats, how much of it is really u.s. centric and how much it is what we're seeing from europe? >> dom is the man, the dominator, one of the great nicknames of all time but the whole volume argument, if you've been fading the market on the lack of volume, you've been getting crushed for the last four years so i don't think volume has anything to do with anything anymore. you know, can you lose as much money on up days on one share as you can on a billion shares so let's throw that argument out the window. >> grasso was making the same

case yesterday. >> steve grasso made the same point. >> if you had used volume as a proxy or as an indicate are of whether or not to get this this market over the past four years, you've been absolutely hammer. >> what about sharon's point about europe here? >> look -- >> should we focus on the dynamics or the fact that they exist in a world where lots of areas look more overvalued. >> more liquidity. >> the whole inversion thing. how much of it is europe possibly taking out u.s. companies? if you're a u.s. company i can't imagine wanting to be in the u.s. anymore? >> the real question is europe proving? their markets have rebounded which is a great thing but look at europe in the aggregate, in the sum of all the parts, the makeup of the european union, that economy is probably just as big, if not larger than the u.s. economy, and they have a few hundred million more people, so you're talking about a huge, huge economy, and i don't think there's the growth there that you need to sustain some of the

rallies that we've seen. germany today is doing great, but you back out germany and you're looking at train wreck for the next five to ten years, in my opinion. >> i mean, that's strongly put, but i will say we saw a big drop in the expectations and german invest investor bank and there's potentially more stimulus out of ecb next month. >> more verbal intervention. we saw the euro falling for five days a row and that's been the stimulus for stocks. weaker euro helps exports, that's a driver and also this idea that politically they are coming around to the idea of qe. it wasn't as easy to do there as -- it was easier to do at the federal reserve but clearly when you hear from the german central bank, that sparked the rally and the rush of liquidity, that's defined the last few years of this bull market rally so you see stocks continue to run. >> and you also have to look at a lot of europeans here buying

property -- >> in new york, again. >> you know, we go through all the different countries. coming in, guess what, the whole euro basket is coming in. maybe they are seeing what everyone else here is seeing that maybe euro is done, right? we're done there. let's go see where we're going to put our money now and new york real estate is a safe bet. >> let's talk about valuations. curious what everybody here thinks. came out of 2013 adding a point to the multiple for the s&p 500, correct me if i'm wrong. pretty much given that up here to date so at this point do we go back into that game of multiple expansion and do we even need to in order for the market to go higher here, guy. >> stocks are not expensive. obviously the russell got itself into a little bit of a pe problem, but stocks on the aggregate are not expensive. that's never been the argument. i don't think stocks are in a bubble. let me tell you something, stocks weren't in a bubble in 2007 and 2008 either. what concerns me, and sarah can probably speak to this, once again is the fact that you continue to hear the rhetoric

out of central banks globally talking about stimulus. for the life of me i don't know how it ends well. i'm not sure there is an exit strategy to the extent that they can voice one. that would be great, but i don't think any of these central banks know how this whole thing ends. >> guy, can you blame them? we saw 0.1% growth being revised negative, an uncertain outlook for re-tail sales, uncertain economy, downturn in the housing market. i mean, clearly the federal reserve, the view, the bernanke view and now the janet yellen view, is that they are there with the super low rates until we can get back to some sort of escape klos velocity or regular growth trend. >> at what point do you need to let the cycles play out? can i blame them, at some point it becomes a political thing but can i blame them, absolutely i can because at some point the economy has to stand on its own two feet. >> as an investor can you fight them? >> i've said that all along. at a certain point you have to

say -- you have to ask yourself at a certain point, and this is a rick santelli thing. how can this possibly end well, and i don't know when that is? it might be five years from now, it might be 75 but at a certain point everything comes home to roost. >> are we getting a little taste that have? >> on the bubble point, can't make an argument. agree with guy stocks are overvalued, bubblicious stocks like twitter overtime. i mean, you've got apple and google at 13 and 26 times earnings. during the '99 bubble, microsoft was 80 times. cisco was 180 times. stocks are not expensive. there's sporadic cases of overvalue, uber momentum stocks, but by and large no. >> and it was all stocks at that time, right? now it's only certain stocks. then it was all stocks were overvalued. >> that's a great point. remember, again, even though we're at record highs, you have a market where some stocks do better than others. some stocks that fall because of fundamental concerns so despite the fact we're at record highs there's a sense if you do your

homework, and guy and the traders on the "fast money" desk, do this all the time, pick stocks and stories and are the ones who outperform. >> dom, that's what makes it difficult for the individual investor who says i don't know which ones to pick, which ones are hot and why it's so important to stick with a strategy of rebalancing into certain asset classes, whether it's large cap, small cap, both, not trying to figure out whether i want to be in tech or in this particular sector. >> i want to know is -- hang on, everybody. i want to know if john steinberg wants to be in tech right now. >> i always want to be in tech. i absolutely believe in tech right now, so 100%, yes, i want to be in tech. >> you're leaving buzzfeed. >> i'll stay on as an adviser to buzzfeed, been there four years, company in spectacular shape, couldn't be more excited but i'm a guy with a lot of energy. you guys know that. a lot of things i want to do. >> do you see yourself as sort of consulting with different

parts of the industry, or do you want to build something? >> i want to continue to operate. i love operating technology businesses, love my team at buzzfeed and will continue to be an adviser. a lot of people were at facebook and it's a natural progression. >> are you going to start your own? >> i'm not joining the wonderful anthony nodo. though i think he's awesome. >> it's telling what you've done at buzzfeed, and people now talk about you at buzzfeed employee number 15 the way they did with google. >> i think of all my early colleagues at buzzfeed and a lot of people started out as interns that are now running teams of 30 and 40 people, a few. everybody that's kind of done -- gone up as the business has grown so big. >> still can't believe you didn't give us the exclusive. >> we just put it out there. there will always be exclusives. >> know you've got to tell the employee first. >> guy, thanks very much for joining us. a lot of important stuff to share. guy is coming up with the rest

of the "fast money" team at 5:00 p.m. and will be speaking with outspoken bank analyst mike mayo on his number one financial picasso don't miss a moment of that. thank you, dom, as well. >> tech stocks up 20% over the year, both outpacing the s&p and nasdaq and should investors be worry about a tech bubble because it can't really be 1999 all over again and porsche sued over the crash that killed "fast and furious" star paul walker. but others say it was speeding. does she have a case? >> in case you missed, this fight inside a hotel elevator in new york. the tape was leaked and the hotel is investigating. in the wake of the donald sterling tapes. it raises the question about whether anything is truly private anymore. you won't believe what the panel has to say about this coming up in "closing bell." keep it right here. you've watching cnbc, first in business worldwide.

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become earnings. >> the company posted better than expected first-quarter earnings did you about post numbers lower than street expectations. the company posted better than expected quarterly results and gave guidance that was lower than what analysts were expecting. it's interesting because it did dip in the after hours. came back a little bit and now it's down 1%. >> thank you, sheila. there's been some concern, meanwhile, that evaling as of tech startups is reminiscent of the dotcom bubble 14 years ago. josh lipton is looking into whether history is about to repeat itself and joins us now. josh? >> certainly the question is silicon valley partying like it's 1999, one question for venture capitalists. you look at valuations of some of the startups and they have been rocketing higher.

palantier at 9 billion and pinterest at 4 billion. you talk to some and they say startups today generate a lot more revenue and the technological landscape has changed providing a lot more support and opportunity to the startup scene. >> if you think about mobile, you have android and apple which allows people to start selling to 131 plus companies on day one and think about social as a platform that allows to you reach billions of people, again, leveraging facebook and twitter. >> bottom lines, not a lot of bubble talk. these pros are much more interested in talking about their investments rather than speculating about the next tech bubble. kelly, back to you. >> yeah, josh, they want to be part of it, at least on the way up. thank you for now. let's get reaction with our

panel. john steinberg, maybe this would have been more appropriate months ago when the nasdaq was at its highs and everything was coming up roses. >> fred wilson has done an expect post on this as well. these are preferred share prices, people buying in at 10 billion or 5 billion. not a real 5 or 10 billion. those investors get the money off the top. and it's almost like a quasi-debt instrument. not saying that these are cheap companies, but it's not quite that expensive. >> air b & b, how can that be worth a full $10 billion? >> if i get my 100 million i put out three times over so it's like an option on the valuation almost. >> a lot of air has already come out of this ipo bubble, new technology bubble. box postponing its ipo is a good example and king digital wasn't well received by wall street, in stark contrast to what we were seeing. bubble harkening back to tech bubble 2000.

>> if you say to investors, because when you do a google search on tech bubble you'll see a story from 2011, 2012, so how is 2014 any different? what investors need to do, particularly in it for the long term, is really stick to their plan, whatever it is, and not worry about whether or not we're in a bubble because if you try to figure out we are or aren't, and you pull back or add more then you're in trouble. >> when you're buying in at that valuation, you're going to assume that they will get to 100 million, 200 million in revenue in the out years. private market investors are doing this because they are basically competing to get in prior to the ipo which is bidding up all the prices. so little room and the companies actually come out of the gate like a twitter and king digital, on and on. >> in some ways that's almost worse but it creates a dynamic where the people who can get in there and get in there first and are at least creating for themselves some value and when it goes public it's the public that becomes the real place

where you get burned. >> when you talk to venture investors, part of that prior generation when companies went public worth 5 million, 100 million and 4 million in sales, allowed the public to get access and the government took a paternalistic view of this and throttled back. >> have you noticed anything changing since the jobs act when companies were more early stage are able to go public, and you made the point about ipos, they have not done well necessarily. >> you're still talking about sub billion in sales. >> i wonder if aalibaba will set the tone. >> that's such an established business. >> it will pull so many dollars out of all of these things. we have rotation into high quality blue chips and now rotation out of lesser high quality high-tech momentum stocks and everyone will pull their money out of everything and pull it into alibaba.

>> that's a great point. >> that will be watched closely. >> increasingly popular options in 401(k) plans but my next guest says if you're not properly investing in them, your returns could be way off the market. how do you invest in those kinds of funds? that story is straight ahead and a word full of killer drones. this is not the terminator move. we're talking about what the u.s. military could look like in the not too distance future. jane wells taking us inside the future of the defense industry later on "closing bell." e moviny to new york state. the numbers are impressive. over 400,000 new private sector jobs... making new york state number two in the nation in new private sector job creation... with 10 regional development strategies to fit your business needs. and now it's even better because they've introduced startup new york... with the state creating dozens of tax-free zones where businesses pay no taxes for ten years. become the next business to discover the new new york. [ male announcer ] see if your business qualifies.

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welcome back. you could be sabotaging your own retirement according to money management financial terms. investors are making some mistake. joining us now with the mistakes. with me is chad sparks, ceo of the online 401(k). welcome to you both. jeff, can you first clarify what is financial engines? >> financial engines is the largest independent investment adviser in america. hired by big companies, 149 in the for tube 500, to help employees with their 401(k) plans. >> you don't manage money. you are a consultant to some extent. >> we're an independent adviser. we use other people's investment and build personalized portfolios and basically for people who are working on their way to retirement. >> okay. and in the course of doing business you noticed or decided

that there was a problem out there with target dated funds and looked into it. >> the story is big e. 78 million baby boomers who are trying to invest 3.1 trillion in 401(k) plans. been hired to help 9 million of them and people ask the question. do people do better when they get help? the answer is they do. typically on the order of 3% better and what we found is target date funds are trickier to use than most people thought. >> if i'm following this, chad, what jeff is saying making the case obviously for financial advisers, that's his business, fine, but also saying in the course of making that argument that people are misusing target-dated funds and are doing so because they put some of the money in target-dated funds and that defeats the purpose of what a target dated fund is. put the exin that basket. is this prudent for the typical person to do, to put all of their eggs in a target-dated fund? >> first i want to thank jeff

for publishing the study. i think it was very, very insightful and really opened a lot of our eyes to the efficacy of the target-dated funds and the fact that two-thirds of the users are using target-dated funds incorrectly. i think it's a valid point. >> are these individuals or institutions, the 9 million? >> these are individuals, right, jeff? >> these are individuals, and we looked at 770,000 of not the full 9 million and cross the 7,000, we do see 60% of folks using target date funds misuse them in some way. >> here's a point that i think is very important for people to realize. when we're talking about target date funds i think with financial engines, chad, what would you advise as well. a lot of folks are saying this is the type of fund to get in when you're starting out, when you're trying to figure out where to put your retirement dollars. all the stocks at the top of the

hour on the closing bell. you're overwhelmed. this is a way to get in, initial investment into the 401(k), how do you it, start with a target date fund in the issue is us a grow that money and amass a lot of money in your 401(k), then you want to start to diversify, and when you do that the efficacy of the target date fund is lost. >> is that what you're saying? >> you got it exactly right. >> they are a great way to start. i think ideally a lot of employers thought that maybe this is the silver bullet. maybe we put all of market in the target day funds. we'll solve the retirement funds. you get older and get married, thinking about putting money into your 401(k) and taking money out of your 401(k), certain limitations to target day funds and that's where people want a more personalized managed accounts solution. >> what's your advice here? all of my retirement money is in a single target-dated fund. >> yes. >> are you making recommendation that for or against me or it

depends on how old i am? >> depends if you want to put all in one fund. >> all of your money is in that fund and you're a little bit of a distance away from retirement, probably a pretty good idea. we found that people in target-date funds properly used do much better to the tune of about 3% net of fees better than people doing it on their own so the most important thing is get help and the second most important thing is if you use a target date fund, make sure you use it the right way. >> for full disclosure, comcast, nbc universal my employer is a client of a financial engine so as an employee of the 401(k) i've looked at the product and tried to use this product. my bottom line is whatever type of financial advice you get will be helpful to you if you're not one who is savvy with your investments and i consider someone who watches this all the time but i still want a third party opinion and whether that's going online with something that you have and going to financial engines or paying someone a fee, i want to get some help but for a lot of people starting out,

they don't think they can afford any help, and they still need help, and that's what a target date fund does, once you start adding more eggs to the basket, that's when you need to probably talk to someone about what to do? >> can you give us one common pitfall? >> would you recommend that more people consolidate those assets as they get older and they might have come from marriage or what have you or that it's okay to be diversified a little bit later in life? >> you know, this is a very tricky area, no doubt. as we said there's experts on the panel who also find this very challenging and people want to be told what to. do they want that sort of reassurance so, you know, unfortunately, target date funds, it's not easy to do an apple-to-apple comparison because you have different glide paths and different strategies and different approaches, so jeff was right we were all hoping these would be silver bullets but the fact is it's going to be an individual by individual situation and people really need to take that control in their own hands and educate

themselves. a target date fund, if chosen correctly, could be a good vehicle and the point being that people have to -- you cannot completely outsource your own future and that's what we were trying to do. >> target date funds, there was a phrase that said set it and forget it. i think that's some of the worst advice you can possibly give somebody. can't just set it or forget it and hope that everything works out. >> the takeaway should be make sure you're saving something in a 401(k) plan period, and that's better than nothing. >> chad, jeff, thank you, a rate it. >> natural gas prices are up more than 11% over the past year. why is canada's largest natural gas producer in canada making a major move into oil? we'll speak exclusively with the company's ceo and why was jay-z attacked by beyonce's sister in a new york elevator and the bigger and more question is whether this leaked video is a sign that the age of privacy is over.

the panel weighing in on that ahead on "closing bell." (man speaking chinese)

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on how to get a mortgage. if today's hot list is any indication that may be changing. >> i've got planes, e-mails and mortgages. first the planes, jane wells has been kicking it for us today with her piece with the f-35. that's the joint strike fighter that lockheed is producing for the government. that's costing taxpayers about $1 billion a month. they will end up with 2,400 really hot planes that they hope will take them for the next 25 years. however, there are some problems. jane's been laying them out for us, and i think it's something about the military hardware. our readers have been gobbling this one up. at one point we had 3,200 people reading it at the same time concurrently. it's just been great. the other one a little bit closer to home for us computer tapes, there's a new e-mail going around, it's a fishing scheme and it's trying to get your g-mail pass wrd, and once it gets your g-mail password it can go into all your google stuff, an e-mail that comes to

you that says oh, my goodness, you're about to run out of storage on your g-mail, click this link, that's the giveaway. don't want you to do. wanted to warn people about that. katie thompson wrote it up. >> the panel here is already nodding. >> a lot of misspellings in their e-mail, by the way, dead giveaway. >> it will bite you, and finally diana olick, one of the heavy hitters on the website. a new regulator for fannie and freddie. he laid out today his ideas for maybe not lowering loan limits. that would essentially open up the mortgage market a little bit more and make it easier for people to get mortgages which might help out the housing recovery a little bit which seems to be showing signs of sputtering lately. mortgage is always a big subject on the website. that story has been kicking it fours, too. >> not as big as the fighter jet. thank you, alan. >> have you been victim to this affirmative action. >> phishing scheme is when someone sends you an e-mail, put in the password thinking you're

in the site and people do this. there was a phishing scheme going on, let us know so you can take precautions, the double whammy of the affirmative action scheme. >> such an old school way to do it. this type of phishing has been around as long as e-mail. >> getting more compelling. >> and there's no number to call anymore, and if you want to verify it by calling and talking to a real person you can't necessarily do that either so how do you know? >> do due diligence on affirmative action e-mails. >> and all employers must appreciate it and how many employers click the link. >> it's like, you know, you've got to admit it, always want to encourage people to admit it. everyone has fallen victim to a phishing scheme. when someone e-mails out something about guava and diets, you know they have been victim of a phishing scam.

>> and walking back some of the potential reforms that could be coming down the pike for fannie and freddie and generally speaking it's an issue that any privatization of these -- privatization is not going to happen. would anybody like to argue the case that it happens at this point? >> it's going to be very politically tricky. the housing market was sort of recovering and the issues were being pushed to the wayside, especially since the companies were becoming profitable. if we lose momentum it's interesting if that changes the debate and -- >> i think they have given 200 billion back to the treasury. >> no first time home buyers in the market. that's a really bad sign about the overall health of the real estate market, and they have to -- i think all discussions today, and diana olick's perfect piece, really helps to address that. >> isn't it the case first time buyers can with the help of f a

fha -- >> the prices are so high that even 3.5%, everybody's got sticker shock. >> but it's not a supply side. >> do you think -- new york is with the craziest market w.rents so high in new york do you find any first time families finally moving to a purchase because the rents have gotten so craze? >> young, young, young people, millennials outbidding each other and bidding above ask orders. >> and as diana pointed out in the story, folks are doing all cash buys and dolly was saying how many foreign investors are coming in and buying up apartments here in new york which is pushing out the first time home buyers, too, so if you're bidding against an all-cash deal, how do you make yourself look like a good risk. >> is your first time home buyer american, or is it a college student? >> only in manhattan. >> thank you, guys. call it the angry and the litigious, in the aftermath of the high-speed crash that called paul walker, the star of the

"fast and furious" movies comes a lawsuit against luxury automaker porsche by the wife of the victim. is there any merit and should porsche be worried? an army of drones and robots, an jane wells is on the front line of that story next. (mother vo) when i was pregnant... i got more advice than i knew what to do with. what i needed was information i could trust on how to take care of me and my baby. luckily, unitedhealthcare has a simple program that helps moms stay on track with their doctors and get the right care and guidance-before and after the baby is born. simple is good right now. (anncr vo) innovations that work for you. that's health in numbers. unitedhealthcare.

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in a we believe outshining the competition tomorrow quires challenging your business inside and out today. at cognizant, we help forward-looking companies run better and run different - to give your customers every reason to keep looking for you. so if you're ready to see opportunities and see them through, we say: let's get to work. because the future belongs to those who challenge the present. welcome back. the widow of the driver of the porsche that crashed and killed paul walker who was star of the

"fast and furious" movies along with her husband has filed a lawsuit against the luxury automaker but some vital claims in the suit contradict official police findings. here with more details is phil lebeau. >> remember, this is an accident that happened last november in southern california, got a lot of attention because people said was there something wrong with the porsche that was being driven at the time that killed roger rodus, the driver along with paul walker who was known for his acting and starring in the "fast and furious" films. yesterday a lawsuit was filed by the widow of the driver, roger rodas, and in the lawsuit they say the porsche went out of control due to the failure of a suspension component in the right rear wheel area. keep in mind the family says that the porsche in the paul walker crash was going 55 miles per hour. that's important because police reports say that it was going between 80 and 39 and that speed was the primary factor behind the accident. the victim's family also says

that the porsche career gt lacked a crash cage along with other items in the vehicle that would have limited the fire that engulfed the car after the crash. porsche, we reached out to them today in response to this lawsuit and porsche said we're very sorry for the rodas and walker family's losses. the crash was the subject of a detailed investigation by the property authorities, that being the l.a. county sheriff and the california highway patrol and their investigate disproves the allegations in the lawsuit. the investigation found that driving at a high speed in a negligent manner caused the crash and concluded that there was no mechanical defect. it's interesting because there had been a lot of theories that were thrown out shortly after the crash, kelly, about whether or not the car was responsible for this accident, and initially the police, they still stand by this, are saying, no, it was because of the speed at which it was traveling when the accident took place. kell? >> phil, thank you. >> for more now on how this could all play out and whether his widow has a case let's bring

in civil attorney michael cardoza. thank you for being here. >> you're welcome. >> show alleges he was driving 55 miles per hour and there were defects in the car. does she have a case? you. >> always have a case. i mean, they are going to hire an awful lot of experts to come into this case. this case will be overloaded with every type of expert that you can think of. this will be a very, very expensive case for the plaintiffs. it will be an even more expensive case for porsche. now when you talk about that initial investigation remember who investigated it, los angeles sheriff's department, along with the highway patrol, but who did they invite in to do that accident reconstruction with them. they invite porsche engineers to come in. now, isn't that a little bit suspect. i mean, they have a dog in this fight so they will come in and certainly say things that bode

well for porsche because they have got to think we may get sued here, so the trier of fact in this case may in fact look askance at the fact that when those law enforcement agencies went to recreate, who did they bring to the party? they bring porsche with them. it doesn't smack of fairness to me. >> there's a huge problem between 55 miles an hour and 80 miles per hour, and how is it possible that those two are out will. >> well, it's not impossible. you'll have experts that come in, i guarantee you, that the experts that the plaintiff hires will come in and say, no, they were going about 50, 55 miles an hour. they were driving the car in a perfectly sane fashion, not speeding, not doing anything, this is what the porsche experts are going to say and they will say well over 90 miles an hour, driver error and there you go. >> even if that's true, right, so let's say they were going 80 miles an hour, 75 miles per

hour, isn't it contributory negligence but not the whole story? not the whole story. there could be mechanical failure. >> no question. there could be mechanical failure and that's why you have to bring in the experts to talk about the fuel tank and talk about the suspension that may have gone out of whack, and that's why i say porsche will fight this tooth-and-nail and spend every penny they -- >> how much is it going to cost them? >> you're talking millions and millions of dollars. >> how the plaintiffs will determine this 55 miles per hour or how have they done so, you said that porsche engineers were involved in recreating it initially for the sheriff's department to report. how can now so many months later the plaintiffs be able to do this and come up with certainty that it's 55 miles per hour? >> well, what happens is they save the remains of the porsche. the plaintiffs then have access to that car to send their experts in, to send their

reconstructionists in, to send their engineers in, to take a look at the -- at the salvage of that car and make determinations and do all the physics that are necessary. >> in these kinds of cases, how would you ascribe the likelihood of outcome based on what you've seen? >> well, it depends on who has the better experts kauai quite honestly. experts come in. you have 12 people from the community. should you get to a jury trial, and quite honestly they are going to decide on a very human and base level. they are going to say we like that expert better than we like that expert. that's how they are going to decide it. >> it does seem like we're in a moment in time when there's a lot more automotive safety and general concerns and i wonder if we're not in an era when air bags first got put into cars, whether we'll see a lot more of safety issues. >> this was a carrera porsche, gt, as close to a race car as you could get, and they put that on the street. that will be one of the

arguments of the plaintiffs. >> yeah. >> look, you put that race car out there. >> wasn't y hady had a trained car driver? >> they both know what they were doing. >> wouldn't a jury think they are going excessive? they don't want to affect their sales or affect their reputation. therefore, they -- >> why don't you write a check had. >> they may want to settle quickly so the real truth gets out to the public. they will fight, it i guarantee it. >> appreciate the perspective. >> first, it was donald sterling's leaked seemingly private conversation. now hotel security footage has been leaked capturing beyonce's husband jay-z getting slugged by the pop star's sister. we'll debate coming up if the age of privacy is over. i make a lot of purchases for my business. and i get a lot in return with ink plus from chase like 60,000 bonus points when i spent $5,000 in the first 3 months

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the future of defense in the united states may rest in the metallic hands of robots and drones. at the unmanned vehicle con vext in orlando. >> we're going to be watching

for any robotic movements here. >> am i really human kelly? >> we don't know. >> what we're talking about here is in the next 25 years whether in defense or during peace time protection you will see more machines less man power. even today sakorski is ruling out helicopters. all of these machines should be facer, sometimes cheaper, but facing challenges. the defense department is currently testing the possibility of armed robots which could ride along and provide cover for soldiers and marines. or you can see convoys taking on jobs. think of this as google cars. but controlling them is labor intensetive. >> what we haven't be able to do

is get the robot will it will operate without constant supervision. >> we would like to make them much easier for the operators to operate. >> now, unmanned aerial vehicles are multiplying into various shapes and sizes. like all of these companies, they're trying to find commercial customers in the face of smaller defense budgets. >> let's say you want to go look at power lines or oil lines. infrastructure. this is going to an airplane used for many, many different things. >> and that business der pend on whether or not the faa is going to allow domestic air space to be open to drones. the faa is thinking of exempting drones, allowing them to do certain jobs called dull, dirty or dangerous. checking power lines, or even

perhaps movie shoots on closed sets. not for sure. >> dull, dirty or dangerous. that's the new 3d. up next, final thoughts from our panel. if you are a flappy birds fan, be sure to tune in tomorrow. the creator joins us to discuss something big he has coming soon. we'll be right back. [ female announcer ] there's a gap out there. that's keeping you from the healthcare you deserve. but if healthcare changes, if it becomes simpler... if frustration and paperwork decrease... if grandparents get to live at home instead of in a home... the gap begins to close. so let's simplify things.

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welcome back. it's the video a lot of people are talking about. after leaving a late night party at the hotel in new york city, rapper and business mogul jay-z caught getting physically attacked by his wife's younger sister. there's no news what provoked the altercation. it brings to light privacy. we have the video leaked. the hotel is furious. are we in an age where we have to assume that nothing is private? >> absolutely. >> weren't these released by tmz also? >> you go around and see go-crows everywhere.

the pervasiveness of these devices and these phones have monitors turned on. they can record sound. >> like the google glass. isn't that the whole point, you could be filming by blinking your eyes? >> i know some people who during the nsa type thing were so paranoid that -- >> how about we erase that behavior and get them out of our voe cab -- voe cab lar. if you can't say it, then you shouldn't be saying it. >> it sort of comes with the territory. >> i don't love the fact that donald sterling is lumped together with this case. >> because we don't know what happened. >> a couple different things going on in each situation. especially in the case of this videotape. we have no idea. >> no idea. >> what happened. we have no idea.

who are we to even be talking about this to be showing the video? let me take a quote from jeffrey rosen who has a great book he's talked about. he's speaking about a specific case back in the late '90s. he says the problem is not by and large that the gossip reported is inaccurate but part of a brutalizing dynamic, information treated as public is converted into information treated as private. you cannot escape this. >> it becomes part of the record of your personalhood. >> it just happens. >> that doesn't make it okay. >> no it doesn't. but it is a fact of being a celebrity today. earlier today i was on the "today show," dolly parton was on and said there was no way she

would survive today. >> it does make it interest. whether it's okay or not, everyone is going to click it and watch the video 100 times and we want to see what they're doing. >> i have not watched the video. i'm sorry we showed it. it is the responsibility we all must share. "fast money" coming up now. of to you melissa lee. >> here in new york city's times square. our traders are tim, dan, karen and guy. and we have also got the always spicy bank analyst mike mayo here in the studio. big brother banking coming up. we start with where is the growth. the momentum names falling back to earth. small cap stocks. where should investors look right now. >> i think some of these big cap industrial names, i think there is growt