percentage point gain, up 37 points. the ten-year note after the auction this afternoon of two years is at 2.53%. top winners today, almost a 6% gain in first energy and rg energy up, and the priceline group is up better than 4%. a pretty strong day, ty. >> i think i get bills from first energy. that will do it. >> i'm sure you do. "street signs" begins right now. see you tomorrow, guys. should you be nervous that nobody seems nervous about their investments? hi, everybody. we've got an incredible list for you of everything that is higher this year. plus are those higher prices proving the official inflation data, you know is baloney? the disturbing stat about people who may never come back to the job market. and the possible problems of a big book that has all of wall street talking? >> so many superlatives today

all-time highs, i can't go on, but i won't. brian,ivity a quiz. >> oh, no. >> what is the best performing major index so far this may? easy one. >> nasdaq? >> whoa, yay, we have a winner. what's really been interesting is the comeback is a lot of those momo names. currently at a two-month high. let's get to bob pisani, rick santelli in chicago. what's your thesis we'll get into in a second about why we're getting the follow-through if you like the from the historic wins in may what happened to sell in may/go away. >> traders were getting shopped up, because you get up ten points, up, down ten points and you couldn't make any money on it. traders were very unhappy.

since then we've put together four straight up days. very rare to see this, and we're at history highs. a lot of players who have you flag have been forced back into the market. a bit of short covering going on. take a look at may for the last few years. last two years, sell in may didn't work very well. before that, 2012 certainly works, but you can see it's a choppy, sell in may doesn't always work. banks are leading it, talk about bank of america today. farce i can tell this is an market expiration here, the fear premium has essentially collapsed, you the ukraine not really there. that's why you're seeing the gold stocks move to the down side. back to you. >> thanks very much, bob pisani. rick, we have a trifecta of good

economic news this morning. what are they doing to yields? >> i don't know about a trifecta, durable goods -- and case shiller, we all know the limitations of housing. i like bob's comments. everything keeps moving higher. look at gold, look at the vix. i say look at treasuries, okay? there is no fear, but yet interest rates are still low. as a matter of fact we're several basis points from testing a new low-yield close in tens, going beyond july, and that number would be 249. i continue to say the stencil is in place. stocks are going higher for a lot of reasons, maybe not the least of which is a little help from the fed. treasuries are painting a future where the economy may be humming along, but not humming along as aggressively as it has historically beyond this far a recession. >> thank you, rick. dom any, you have a market

flash, what are you looking at? >> shares of citigroup right now coming off its highs, this after the cfo parening, saying he sees that second quarter of trading revenues will fall by about 20 to 25%, compared to the same time last year. you can see citi shares taking a dip on that bid of news, but remember, brian, mandy, this echos what jpmorgan told us earlier with regard to how their trading revenues were possibly going to decline as well. >> so what exactly is up with the market this year? well, how about everything? look at this. we promised you a list. we will deliver. the s&p 500 up more than 3r%, bonds both treasury and high-yield, a.k.a. junk are up -- oil, crude up nearly 6% this year. gold while down today, still up year to date. platinum and palladium are still higher, corn, wheat, hogs

soybeans, all the stuff you buy at the stores and restaurants, my friends, hogs up 45% just this year. put that in your bacon pipe and smoke it. joining us is btig global strat just dan greenhouse, and peter schiff. all right, dan, i think you follow my logic. is the lack of nervouses in the reason to be nerve usa? >> i don't think so. >> we're going to talk about it for five minutes. >> that's why we're here. clearly there is -- i don't want to use the word complacency, but i think certainly this is a sense entering this year and now in this year that things are beg than they have been for some time. >> yeah, but you get my point here, dan. i understand that bonds are down and that stocks go up or if gold is tanks, it's still up. money is moving around from one

to another. where is all this new money coming from? it's going into housing, into bonds, into stocks. >> well, i mean the economy is always getting larger, the money supply is always going up, the pie is always getting larger. by that rationale, if new money ever exists nothing would go never. >> give us something a bit different. don't just say it's all due to inflation, surely. >> well, first of all, i disagree the economy is getting bigger. we have more money. that's why prices are going up, but the quantity of money is not what determines economic output or growth. it's a way to price what the economy is going to produce anyway. but we are producing a lot of inflation, when economists used to talk about inflation, what they were referring to is the expansion of the money supply. that's where the word "inflay" comes from. we're running big deficits. the fed money advertises them, we're still doing qe, interest rates are still at zero, and you're creating a lot of money,

prices rise. and consumer prices are going up. you mentioned earlier that the official statistics are baloney, and they are. by the way, you know, the price of baloney is going up a lot faster than the stock market. >> i want to jump in here for a second. peter may be right that the official statistics are not accurate, but people have been complains since it was created. this is not a new concern that certain people feel price increasing are different -- or decreasing differently than other people. this again has been around for the better part of 100 years. the rate of change in the money supply isn't necessarily that rapid right now. i think it's up about six and change, that compares to an average of about 7% going back however many decades. the rate of change -- >> but 6% is still a lot of inflation to create -- you're destroying 6% of the value of money. >> and one of the things it does

is -- inflation stops prices from going down. that's still disruptive to my standard of living if the government prevents the cost of living from going down. food doesn't become less expensive. energy doesn't become less expensive. inflation is still doing damage. of course it distorts of markets, it distorts savings and investments. is it distorts the allocation of capital. >> peter, that's fine, but we're never going to have a -- the united states is never going to tolerate deflation on a -- on an economywide scale. it's just not going to happen. we can sit here and scream at -- >> unfortunately, you don't have to tolerate it. you enjoy it. it's the government, the debtors that don't want to tolerate it. >> let's bring it back a bit. >> hold on. yeah, but for every debtor -- >> gentlemen, let's take a breath. i want to bring out something else. you mentioned the cpi. i didn't want to say it, because

we could put an insomniac to place, an rbc capital note caught my eye. they said in their analysis, 7 on% of those things mentioned were up in may, were up. yet the government keeps saying there's no inflation. i hope the government is right. nigh fear, dan, is inflation will come on quickly and we're going to get caught out. >> what you're leaving out of that, brian, is if they have moss 70 illustra-- those items and nintendo, they don't have the same impact. what a cpi or pci trying to do is balance out the rich and poor, left and right, up and down to come up with an economywide measurer at any point in time. there will always be people that feel the increase in gasoline more than other people. i don't own a car. gasoline could go up in however much. in theory from a driving standpoint, i won't be as

effective as someone who commutes to work. >> you don't take a cab or ride in an airport. >> no, i walk everywhere. >> and we get that. >> you're still affected by it. >> i'm tall and lean. i walk everybody where. >> peter, in your scenario, when is the fed going to raise rates? to what degree do you feel they're already behind the curve if. >> they're not going to raise rates until there's a bond crisis. they're going to keep rates at zero to postpone the pain as long as they can. even if you look at the most recent, year over year it's 2%. ppi up 2.1. we're already at this theoretical 2% tattle and the fed is complaining we don't have enough. it could get higher. >> that's not right. >> and disproportionately -- >> guys, we would love to continue this party another time. >> i'm wrong. those are the government numbers. >> but that's not -- >> keep on going, dan. bottom line. >> the bottom line is the

federal reserve is not shooting for 2% today, tomorrow or the next day. it's a theoretical price increase you want over the medium term. the first time you hit 2% is not the time to tighten. just ask the japanese. >> what if we -- heys guys, you know, nixon imposed wage-price controls. we're halfway there. >> there's something between a moderate left and jumping out of a building. >> we hate to break up the party, but we're going to anyway. >> listen, clearly, dan, you know that the feed for your horse and omnibus is clearly going up in price. guys, a correction on my part. once again, i confused the scottish can the canadians. it's rbs, not rbc. sorry, scotland. grab a hard hat and hammer. we're about really to people inside the fed's toolbox. ahead, the alarming number

of out-of-work americans who have simply given up on the job search. "street signs" begins after the break. sneed y. worked hard. raised two kids. they've never been to moscow. but they sent money there. rented an apartment. all because, they have this 19-year-old daughter who loves to dance. in over 700 cities worldwide, products and services that make a citi client anywhere a citi client everywhere.

. normally say steve liesman and "toolbox" in the same sentence, that can raise eyebrows, but when it's a fed toolbox, it adding to intrigue. steve has a shopping cart of really big things. what is going on here? >> here's what's going on. the fed has a problem.

it's going to try to normalize rates sometime next year, we believe, but there's excess reserve sloshing around the system. so the fed will warrant to set a rate, but it won't be able to hold that rate. the fed has been using all these tools, or thinks about the tools, usingly basically tests to try to see, can it control the rate? here's the first tool, the one that everybody knows about. it's the fed funds rate. it's probably -- >> careful with that ax, eugene. >> it was powerful. the fed will try to set this rate. so it's vetted a whole bunch of mutuals. reverse repos. >> wait, that's a real sledgehammer. >> you know what a reverse repo. the fed will put the security out overnight, and soak up cash into the system. that's testing those right now. what else do i got?

how about this one here. >> can i hold that one? >> term deposit facilities. that's like a big certificate of deposit. you take the money, and put it on deposit, and the fed pays you in interest rates. if you'd like to put those down -- >> maybe this is a big one. hold this ax here. we have interest on competent reserves, what does that mean? >> it's going to pay you in interest rates to keep those excess reserves. >> you know, brian, you pointed this one out, first. you like this wrench. this is the most interesting of all to me, the pleat itself. the fed can't, in a situation where it has a problem, it can sell assets, basically get rid of these excess reserves entirely by selling assets, retiring the cash. so that's the toolbox. >> wait a minute, sir, if this was "game of throne" which tool is the most powerful in the

toolbox? the interest on, the short-term deposit facilities crowbar? or the fed funds rate chainbreaker? >> i think having all of these tools is potential the biggest power of all. what the fed doesn't know is which strings to pull. if you think about it as a big dam draining the liquid pool, there's four or five different gates. the right mix is what the fed doesn't know. we're going to have to follow all these things. i don't know that any one continue lard will be seen as more powerful than the other. >> and which one will be able to hold occupy -- >> certain the ax. >> certainly the ax is the most fun. stick around, steve. we have a new survey which says 47% of the unemployed have completely given up looking for work. let's bring in bob.

bob, it's great to have you with us some of your findings were quite disturbing. what was the main reason who have just given up? >> well, they've given up, because they think the economy has not rebounded as well. they don't believe the jobs are out there. many have been looking for a long period of time, or become discouraged. consequently they have just given up looking. however, the positive side of that is 91% of them have some hope that sometime they will find a good job and find a good opportunity. that's where we in the staffing industry come into play. we try to find those jobs for them, give them hope, encouragement, have compassion on those out of work, because it's difficult finding a new job. >> it is difficult. with all due respect for those who can't get a job and don't have a job, to what degree, bob, is having unemployment compensation mailings it more conducive to not get out there

and search as heart as they would otherwise do? >> well, the entitlement program certainly hurt many of them, and many will not go to work, because the entitlement programs are larger that is the salary or pay might be, and consequently it with that, many turn them down, because the entitlements are too large. they have unemployment compensation, workers' compensation, disability insurance, then they have food stamps and other entitlement programs, and they have a difficult time justifying going to work when the entitlements are larger than what the take-home pay, except for those who want a good image of themselves. >> i think, listen, we have hammered that point. it's a political hot button. there's people out there that want work, and there are people who probably just don't want to work. what disturbed me about your survey is that 60% of those surveysed, unemployed, said they are not willing at all to move to another state to look for

work. i mean, you talk about somebody who went from california to virginia with my parents at 14 years old so my dad could get a job across the country. it's hard, you leave friends, family, the housing markets stinks. are you surprised so many are not willing to go? if you need a job, you need to go where the job is. >> well, i've been through eight recessions, and coming out of recessions, it is more difficult for people though think about moving, because they wouldn't think about it during the recession, because they don't know whether they could find a job that would be permanent in another location. we do have certain parts of the country, and over 700 offices across the country than in dire need of good people, but most of them are semi-skilled and skilled individuals. many of them who need to be retained, reeducated. that's the discouraging part of this survey, is that they won't be reeducated. >> you suggested things like unemployment benefits are larger than the wage people would make? most of the survey data i've

seen suggests that people do not make the same amount of money from government entitlements as they would make from actually holding a job. >> well, remember the entitlement money is clear money. when you're working on a job, you have to pay taxes, and taxes, of course across the country will range from 20% to 50%. >> did you ask people that in the survey if indeed the entitlement money or more, less or the same as they would get from a job? >> it is a harris poll. i don't believe they asked that question, about but if you look at the survey, you'll see that many feel they can't go to work and make more than where they're currently living if you've a couple kids, child care, no family around, plus you throw in taxes, there are some people for who the economically rational -- >> i would seriously doubt -- >> that the rational -- >> i believe that's true at the margin. . i just think -- the suggest here

is that many people are not working because of the benefits -- and i think it's one factor. >> yes, i agree with that. again it's a political hodbed. how about this question, though? if you have this many people unemployed for this long, how do you make ends meet? how do you live if you're not working? that's a -- >> i mean that sincerely. >> they continue to be on the entitlement programs. we encourage them to go out and find a job. but i believe or focus in america ought to be on job creation. as you know, you've seen the surveyor from the census bureau that 98% of all jobs have -- or companies have less than 100 employees. we need to encourage those companies to have let relations laze. they want to hire people, but the golf is so overbearing in many cases, they don't know whether their expenses will be huge, large or medium, due to

many of the factors, including the aca that we're facing out here in private industry. >> bob, some interesting findings. thank you so much for bringing them to you. >> thank you, mandy. and just to wrap up. i want to finish that. listen, it's a political hot button, right? i know you've done stuff with alan kruger -- irnts and that survey is right. that's kruger's work. >> but here's the problem, you can't say one thing and be right. people have worked their fingers to the bone that are just beyond out of their mind sick and tired looking for a job and they can't find work. there are probably some people for whom -- nobody is calling them lazy, but the economically rational decision might be to do something else. >> it just seems -- >> it's -- it's -- i know we have to good, but it's an -- >> it's per verse to say that

our employment problem answer is to get rid of benefits. >> i'm not saying that. that would destroy some families. >> absolutely. we're out of time, but we could talk forever. a new front in the booking battles. how vacation rental sites are trying to make hotels go the way of the dodo. and a big impact on big energy. those details when we return. [ girl ] my mom, she makes underwater fans that are powered by the moon. ♪ she can print amazing things, right from her computer. [ whirring ] [ train whistle blows ] she makes trains that are friends with trees. ♪ my mom works at ge. ♪

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shares are soaring after reportedly rejecting a $10 billion takeover bid from an unname bidder. talking with the next guest, they say they offer more homes to rent than intercontinental group has rooms. let's bring in brent bell many. the hotel industry kind of hates you, as some of your competitors, but there are more and more people joining this space, pride? i think priceline has also just

come out. booking.com, how are you different in what are you doing to make sure the people list with you? >> we're the global leader. >> you and i were chatting privately. ed i never used the services. i just find it hard to stay at somebody else's place. is that a hurdle at all, or am i the weirdo? >> it is. in a most recent survey, about 90% of new vacation home purchasers say they intend to rent their house at some point in time. about 40 march -- we have a variety of ways of checking it. very, very view ever guess on the site that are fraudulent. it's a very rare incidence of things going wrong. >> when brings us to the point that the new york a.g. has been

trying to crack down on some illegal hosts, if you like. is this an interesting that bothers you? >> that's a unique situation, since a high persons are aparts for rent, they are the actual mvp of record so if the a.g. has a problem with it -- >> do you think this is really an attempt by new york state or any state, or is it the hotel lobby saying they're trying to eat in our profits. you go to a hotel room, it's about $400 a night at the bedbug inn. >> there might be some of that going on, but the reality is there's more room for rents than they are beds in hotels in the united states. so entire parts of the u.s. vacation economy are dependent on this category. it's not going to go away. >> very quickly the share price

down 20% so far this year. what do you do about improving shareholder value? >> we focus on the customers. try to get a great return for our homeowners. >> a real pleasure. i will -- >> give it a go. >> i'm not quite howard hughes with the germ thing, but i will give it a shot. >> thanks for having me. get ready for shocking new numbers on how much a typical ceo takes home. we're calling it the eight-figure club. >> first, i saw "godzilla" over the weekend, i have to say it was a disappointment, but that's beside the point. how did godzilla stomp its way into "street talk"? that's next.

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our daily talk. american express is moving higher on morgan stanley comments. >> that's right, they're bush but the $100 target. that's what you want to pay attention to. the stock is at 91.19. they're about 10%. they see revenue growth accelerating and upcoming -- american express already up 20% over the past year. >> we've also got our next two stocks. this is what we're doing with regards to godzilla. two movie theaters are getting real loves. >> amc, and caremark holdings, both up about the same. b. riley upgrading both from buy to neutral. at mc targets goes to 28. cine mark. >> northland cutting it to an underperform. that's wall street fancy speak for sell, sees margin and sails

pressure ahead. their targets $240. the stock is at 49.6. you can do the math. we also have our under the radar name of the day, bonanza creek industry. it's a denver-based oil and gas company. it's up, the target up to 68. so they see about another 25% up side on dcei. that stock another hot one. all right. from street talk to talking numbers, our daily look at a stock from a fundamental and technical perspective. today, autozone. it's down more than 2% depiatt beating earnings by a penny. richard ross, and andrew berkeley of open hyper. andrew, would you be a buyer on this weakness in autozone? >> hey, brian. overall, you know, from a portfolio strategy perspective. they don't like consumer discretionary stocks. we want to be on the look on the

later cycle, but i would say within discretionary. the auto parts retailers, which plays more of the macro dynamics. when we look at the name in particular on some of the quantitative metrics, the model has progressively building for the stock, just put up it's 31st straight quarter, good momentum, and valuation, about the mid teens, which is a slight discount to the overall market. if i had to be discretionary. it's not a bad name to be in. not a resounding lump of praise. are they backing autozone? >> if i owned it, i would hold it, but i would not be a fresh buyer, not committing new capital here. first, we're going to look at that short-term chart. you can see since breaking above that 100-day moving average, it goes on a fantastic run.

it cull minute yates with a key reversal. where the stock opens with a high and closes on the low for the sessionent we've been moving sideways, but that's not all bad. that eases that overbought condition, and consolidate ace that sharp run-up. but mandy, when we pull back and look longer term, you can see why i'm not so excited. yes, the stock has been doing fantastic since 2008, up 550 march. look at that trend line we've been tracking, in addition to the 100-weep moving average. down at that 100-week. that's at 427. i'm willing to wait for that move. >> guys, thank you very much. that's autozone. be sure to check out the online edition in partnership with yahoo finance. in the meantime, let's bring in bill grifi and kelly evans for a quick preview.

i know you have the former -- >> a name from the past we all remember on the floor. >> that's right. at a time when so many people are talking about whether markets are broken, michael lewis's book is still reverberating. trading volumes are still sluggish. that may have to do with the storm headed our way, as art cashing reminds us. >> knight capital got caught with a sort of a fat finger trade a couple years ago that they were unable to stop. is the computer went crazy on them. so i'm sure tom will have some thoughts on computerize the trading, high-fresh sill trading. >> and coming up on the show we'll have a couple heated discussions about inflation and come back with a reminder this morning of better than expected reports. this could be the next defining conversation whether or not it moves bond yields at the current moments. >> meantime s&p all-time highs, so we'll see how we do in the final hour.

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this is the answer to the question just before the break, can you name a sector of the market with big dividends and build-in demand? utilities, of course. are we now entering a situation where these thoughts are no longer a good investment? dominic chu, what say you? that's because they stocks have a payout greater than the average part of their earnings. they paid it out again. so for that reason

. again in just the past month. so many professionals are still approaches this sector, but doing so with more caution. terry sanden is one of them. the chief strategist. they manage $10 billion in, and he makes the point that utilities have been an atrackedive place also a cloudy corporate earnings picket dural, but he says that outperformens should decrease, and he sets this sector gets less attract iv as interest rates start to rise. in other words, bonds at lower price with his higher yields draw more investor money than these types of different stocks of the think of it as a rotation between certain asset classes. in that kind of environment, he would much rather by in places

like technologies or industrials. now, he argues that valuations there are still elevated but fair. when it koums to utilities, a nice run so far this year, but remember when interest rates rise, these kinds of stocks tend to outperform. >> sweet backdrop. the without will soon protect rules, and cap and trade to reduty other means. in plain english, john, what does that mean? >> it means it's going to cost money to achieve environment goals. the question is, who's going to pay it? and how much? let me run run through some of the questions about that will begin to be answered when they regulations come out next week. first off -- keep in mind, overall, this is for the objective of meeting the goal that president obama set in copenhagen in an international

agreement when he committed the united states to reducing carbon emention be the year 2020. so to make that happen, epa will use authority that they have, that were affirmed by the supreme court to regulate those emission. so one question is, how much reduction are each individual states going to be required to make? second le, what is the baseline of comparison? is it being cut, for example, 20% below what they put out this year? or 20% what they put out ten years ago? where ear missions were higher? second question is, how much flexibility can states have to achieve those goals? do they have to do something to their power plants -- their coal-fired power plants? or can they do energy efficiency steps for buildings and achieve their reduction that way?

the third question, just like on obama care, you can expect red state resistance, so all states will require to submit to the federal government a plan to achieve the goals, but some states are likely to refuse. in that case, will the fed take over the admission of reductions in those states. just like they -- very complicated, but, as i said in -- to put it in plain language, it is going to cost money. we just don't know whether that would be in your utility big or tax bill, and the administration says it's world it because of the environmental goals that would be achieved. >> key details that we need to know will. i want to quickly ask you. any minute now, president obama will make remarks. let's go live to the white house. as you know this weekend, i traveled to afghanistan to thank

our men and women in uniform and deployed civilians, on behalf of a grateful nation for the extraordinary sacrifices they make on behalf of our security. i was able to meet with our commanding general and the ambassador to review the advisers we have made. i would like to update the american people on the way forward with afghanistan, and how this year we will bring america's longest ward to a responsible end. the united states did not seek this fight. we went into afghanistan out of necessity, after our nation was attacked by al qaeda on september 11th, 2001. we went to war against al qaeda and the extremist allies with the strong support of the american people and their representatives in congress. with the international community and our nato allies, and with the afghan people, who welcomed the opportunity of a life free from the dark tyranny of

extremism. we have now been in afghanistan longer than many americans expected, but make no mistake, thanks to the skill and sacrifice of our troops, diplomats and intelligence professionals, we have struck significant blows against al qaeda's leadership. we have eliminated osama bin laden, and we have prevented afghanistan from going used to launch attacks against our homeland. we've also supported the afghan people as they continued hard work of democracy. we've extended opportunities to their people, including women and girls, and we've helped train and equip their own security forces. now we're finishing the job we started. over the last several years. we've worked to transition security responsibilities to the afghans. one year ago, afghan forces

assumed the lead for combat operations. since then they've continued to grow in size size and in strength, while making huge sacrifices for their country. this transition has allowed us to steadily draw down our own forces from a peak of 100,000 uss troops to roughly 32,000 today. 2014, therefore, is a pivotal year. together with our allies and the afghan government, we have agreed this is the year we will conclude or combat mission in afghanistan. this is also a year of political transition in afghanistan. earlier this spring, afghans turned out in the millions to vote in the first round of their presidential election. defies threats in order to determine their own destiny. in just over two weeks, they will vote for their next

president. and afghanistan will see the first democratic transfer of power in history. in the context of this progress, having consulted with consequence and my national security team, i've determined the nature of the commitment that prepared to make beyond 2014. our objectives are clear. disrupting threats posed by al qaeda, supporting afghan security forces and giving the afghan people the opportunity to succeed as they stand on their own. here's how we'll pursue those objectives. first, america's combat mission will be over by the end of this year. starting next year afghans will be fully responsible for securing their country. american personnel will be in an advisory role. we will no longer patrol afghan

cities or towns, mountains or valleys. that is a task for the afghan people. second, i've made it clear that we're open to cooperating with afghans on two narrow missions after 2014, training afghan forces and supporting counterterrorism operations against the remnants of al qaeda. today i want to be clear about how the united states is prepared to advance those missions. at the beginning of 2015 we will have approximately 98,000 u.s. -- let me start that over just because i want to make sure we don't get this written wrong. at the beginning of 2015 we will have approximately 9,800, 9,800 u.s. service members in different parts of the country, together with our nato allies

and other partners. by the end of 2015 we will have reduced that presence by roughly half and will have consolidated our troops in kabul and on baghram air field. one year later, by the end of 2016, our military will draw down to a normal embassy presence in kabul with a security assistant component, just as we've done in iraq. now even as our troops come home, the international community will continue to support afghans as they build their country for years to come, but our relationship will not be defined by war. it will be shaped by our financial and development assistance as well as our diplomatic support. our commitment to afghanistan is rooted in the strategic partnership that we agreed to in 2012, and this plan remains consistent with discussions we've had with our nato allies.

just as our allies have been with us every step of the way in afghanistan, we expect that our allies will be with us going forward. third, we will only sustain this military presence after 2014 if the afghan government signs the bilateral security agreement that our two governments have already negotiated. this agreement is essential to give our troops the authorities they need to fulfill their mission while respecting afghan sovereignty. the two final afghan candidates in the runoff election for president have each indicated that they would sign this agreement promptly after taking office, so i'm hopeful that we can get this done. the bottom line is it's time to turn the page on more than a decade in which so much of our foreign policy was focused on the wars in afghanistan and

iraq. when i took office, we had nearly 180,000 troops in harm's way. by the end of this year we will have less than 10,000. in addition to bringing our troops home this, new chapter in american foreign policy will allow us to redirect some of the resources saved by ending these wars to respond more nimbly to the changing threat of terrorism while addressing a broader set of priorities around the globe. i think americans have learned that it's harder to end wars than it is to begin them, yet this is how wars end in the 21st century, not through signing ceremonies but through decisive blows against our adversaries, transitions to elected government, security forces who are trained to take the lead and ultimately full responsibility. we will remain committed to a

sovereign, secure, stable and unified afghanistan and toward that end we will continue to support afghan-led efforts to row motor peace in their country through reconciliation. we have to recognize afghanistan will not be a perfect place, and it is not america's responsibility to make it one. the future of afghanistan must be decided by afghans but what the united states can do, what we will do, is secure our interests and help give the afghans a chance, an opportunity, to seek a long overdue and hard earned peace. america will always keep our commitments to friends and partners who step up and will never waver in our determination to deny al qaeda the safe haven that they had before 9/11. that commitment is embodied by the men and women in and out of uniform who serve in afghanistan

today and who have served in the past. in their eyes i see the character that sustains american security and our leadership abroad. these are mostly young people who did not hesitate to volunteer in a time of war, and as many of them begin to transition to civilian life, we will keep the promise we make to them and to all veterans and make sure they get the care and benefits that they have earned and deserve. this 9/11 generation is part of an unbroken line of heros who give up the comfort of the familiar to serve a half a world away, to protect their families and communities back home and to give people they never thought they would meet the chance to live a better life. it is an extraordinary sacrifice for them and for their families, but we shouldn't be surprised that they are willing to make it. that's who we are as americans.

that's what we do. tomorrow i'll travel to west point and speak to america's newest class of military officers to discuss how afghanistan fits into our broader strategy going forward, and i'm confident that if we carry out this approach, we cannot only responsibly end our war in afghanistan and achieve the objectives that took us to war in the first place. we'll also be able to begin a new chapter in the story of american leadership around the world. thanks very much. >> all right. there you go. the president wrapping up a relatively short conversation and discussion about the plans for afghanistan, and he made the point clear on the numbers. 9,800. he wanted to make sure that those numbers were indeed settled. he highlighted certainly some of the already major troop reductions the government has done, but he referenced, john

harwood, the bilateral security agreement as well. is there any way now to easily characterize the relationship between the afghan government and hamid karzai and the white house? is there a relationship? >> i think it's pretty much hit bottom but will get better when the new government takes office and the president made mention of the fact that both candidates who are in this runoff in afghanistan have committed to signing that agreement and that -- that signature is the condition that the president is setting on the allowing 10,000 troops to remain next year and a few thousand to remain through the end of 2016 before transitioning to a normal embassy protection presence. the president is trying to do what he said which is to bring those wars to a conclusion. he's getting criticized already, saw an e-mail just as i was

getting ready to hear the president talk from john mccain and kell ayotte saying this is driven by politics rather than military strategy and, of course the politics are good because people are tired of these wars, and, you know, the president is -- will have to deal with the consequences if things take a tremendous turn for the worse in afghanistan after we leave. he'll have to answer for those consequences, but right now the president is pretty determined to bring this to an end, and if he doesn't get the signature on the status of forces agreement they will all come out by the end of this year. >> john harwood, thanks very much for the wrap-up there. let's take a quick look at what's happening at the markets. s&p at a record high, dow transports at a record high, intraday rodd high for the dow drills is 16,735. we're not there yet, but we're not far away, only a stone's throw away. the s&p is up this year so far 3.2%. >> as we pointed out at the top of the show, find us something that's not up.

high yield, bond is up treasuries up, gold is up, but bare barely. money is just pouring into the united states. i thought one powerful thing the president said is afghanistan is not a perfect place. and welcome to "closing bell," everybody. how is that for an introduction? i'm kelly evans down here on this tuesday after a long weekend, bill, at the new york stock exchange. >> i'm bill griffith. we are looking at the dow up 62 points right now. you can see we're roughly 30, 40 points away from an all-time high. the s&p is in all-time high territory right now. we close at a new high on friday, first time above 1900 and today we've td