if you're a current or former military member or their family, get an auto insurance quote and see why 92% of our members plan to stay for life. welcome to the "closing bell", i'm kelly evans at the new york stock exchange. >> i'm bill griffeth. stocks spending most of this day in the red so far, we are well off the lows of the session, the dow was down 84 points at the low, down 34 points right now, as a matter of fact. >> we are gonna get reaction to this market and how the economy is doing with pimco's managing director, paul mccully in a little bit. he is looking at and listening to the fed and he says what janet yellen is saying is more important than what the fed is doing. he will be here to explain. >> which is very different from the way we used to think about

the fed. don't listen to what they are saying, just pay attention to what they are doing. but now, paul is turning that upside down and taking a different tack. we will talk with him about that coming up. and would you mcbrunch? mcdonald's issing an ling to get into the brunch business. yeah. really. we are not kidding here. is this the type of move that could turn that stock around finally? >> it is the underperformer today, the nasdaq is off about four points. s & p down one point to 1994. some of the other signals from financial markets, bill, from the strong dollar to inflation expectations to what's happening on the yield kur that have has people talking ahead of that fed meeting next week. >> let us talk about all that

coming up in our "closing bell" exchange today. we have heather hughes, peter anderson from congress wealth management, jim lowell from adviser investment he is and rob morgan from b to b associates. peter anderson, month of september, meandering here so much, whatted? what is going on with the market, do you think? >> i think we are all coming back from long vacation breaks, that isn't the first thing. we are waiting for the next fed meaning and see if she will take the terminology out there, specifically the phrase, "for a considerable time." it that's taken out of there a strong signal interest rates, she is going to raise interest rates probably earlier that most of us think and i'm in that camp. i think the rates will be raised the first quarter of next year and i'm absolutely fine with that. i think the stock market is ready. i think the bond market is ready

and i look forward to those -- reading those minutes next week. >> that fed meeting is next week, by the way and you are talking about what they have been saying the last several months, keep interest rates the record lows for a considerable period of time and thinking maybe take that last phrase out. here is the interesting thing, peter, if the u.s. were a vacuum, could you see the case to be made for perhaps acting sooner than markets or the people generally expected here but rob morgan, the fact remains the u.s. dollar has strengthened considerably. on a global base circumstance inflation expectations are moving lower and alan greenspan, when we asked him yesterday on the program is what that means, in affect there has been a tight thing of monetary policy already here. so, how much do you think the fed is willing to risk being a little bit more, aggressive when, frankly, the landscape out there is looking a little bit shaky? >> well, i'm in peter's camp, i think they are gonna raise sooner rather than later and it is gonna cause a stronger dollar and i think the investment implications of that one thing that -- one area we really like is the small cap space, the

strengthening dollar, that's certainly an area to look at. also, really hurts the commodities, but i think the fed -- it seems like our economy is gaining some escape velocity here in spite of the last jobs report, we had six great jobs reports before that one. >> heather hughes, speaking of energy, oil as we know, lower, today notwithstanding that higher dollar pushed oil lower, good or bad? good for consumers, what about for energy stocks themselves? >> hopefully, it put a few more dollars in the consumers' pocket, you are right. crude is at lowest level since 2010, i believe, so that may also be a positive data point along with -- couple that with auto sales, 1747 million i think it was. >> right. >> the over 10% since the last period in 2013 that we have seen in auto sales as well.

king dollar, strong dollar, you alluded to, we are seeing from europe and japan, you know yaupt tatetive easing is only in the beginning stages in terms of stimulus in other countries, the british pound, the your rocker the japanese yen are all in oversold territory right now, you are seeing a rotation to the u.s. dollar, we have rallied nearly 6% from the july 1, 2014 lows on king dollar and perhaps it's even a short-term overbought companies in that u.s. dollar right now. true. you know, jim, if all this were happening and the market, the general public, were starting to see and anticipate higher inflation, i could understand the next steps, but the opposite seems to be happening here, there's -- of a commodity price more or less crash that's going on and inflation expectations are dropping a little bit. so, what does that all mean to you? >> well, they are low for an are, inflation expectations, that is, one is the global market, everyone is just talking about, whether you look to the

eurozone or china, you are seeing the fending off of either slowing growth in china or our expectations are for a mild and recoverable recession in europe. so the global committee is not firing on all cylinders, even though our economy is. that's one of the reasons why we definitely like u.s. multinational battleship balance sheet megacap stocks. we think they will be able to bounce back, the global committee does, more cash in their covers than local governments. >> jim, i hear your point on the u.s. market he is and just from a mutual fund perspective, we are seeing flows internationally, some investors may see the u.s. as overvalued but on a three-year annualized return basis, do you see international markets up 17 -- up 10% versus the u.s. markets up only up 17%, beating international markets. so i understand that you're sake the u.s. still has room to run.

i wonder when you're looking at europe and japan and embarking on quantitative easing in the beginning stages cork that help propel their markets further as we withdraw some of this stimulus? >> i absolutely think it will. we are a big fan of european growth stocks, in particular, because they underperformed the overall european forces, not just across the borkros cross t but step in into big blue chip-like eurozone stocks at a steep discount on the gross side of their fence and for long-term investors, that makes considerable sense when fear is onkrcross the boards. >> assume they take the key phrase out, keep rates low for a prolonged period of time, what do you think the market's response will be to that? do you think they will accept that? is there quantitative easing fatigue right now for the markets or will that spook this

market, do you think? >> yeah, it's been a rather cranky market whenever there's been messages like that. so my prediction is i think that we will take it on the chip. the equity market probably will trade off and i'm actually expecting that to happen. and i think it's just because people are not truly understanding that we do have to raise rates in response to a stronger economy, okay? and what will happen is a buying opportunity, because i'm looking at stocks now and i'm thinking if that does happen, if she does signal that she is gonna raise rates and remember, only probably gonna be 25 basis points, tiny really, but that is a change in trend and people will probably get very anxious about that, but the bottom line is that is a good thing and if you can buy on the dips, i think it's fantastic. we debated this in the past. inflation, i still think a little inflation is good for both stocks and bonds and i think we will wake up to that

observation come early next year. >> peter, just -- hang on, health her, before we go, i want to get you to address this point, as you said, a little inflation is a good thing, a little bit more than we have been seeing is probably what the fed wants but it doesn't seem to be the scenario that's evolving right now. so, what -- you know, in other words, all i'm saying is that if i were the fed next week, given what's happening with the strengthening dollar, the commodity price declines we are seeing, could that be enough to get them to err on the side of caution despite the home tim they are talking about? >> i don't think so, kelly, the feather -- what they are trying to achieve is to get ahead of that curve and every fed chair wants to be credited with seeing this earlier than everybody else, so it's anticipation of that. it's a very, very difficult thing to do i think what they are going to do is try to raise the rate ahead of a high certainty that inflation is eventually going to happen and that's where the trickiness, the subtlety comes into play. fib nish us up, heather what

were you gonna say? >> april 2010, qe 1 ended, markets declined 16%. in july of 2011, qe 2 ended, markets declined 19%. so, perhaps that's pull back that peter is referring and alluding to. >> we will see. maybe we will know by next week what's gonna happen. thank you, folks, proo esht it very much. >> thanks, bill. >> 50 minutes left in the trading session, it is a meandering market, let's all acknowledge what we know, today is the anniversary of 9/11 and a lot of traders, especially here at the there are of the new york stock exchange who were there in 2001 are thinking about that a lot today. it's been a big distraction and a big thought for everybody today. understandably. >> also weighing today, weekly jobless claims, one of the best indicators out there for the stock market, unexpectedly rising to a two-month high. is this a red flag for the market and the committee? pimco's paul mccauley will weigh in later. also, going to take a look at how america's education system may look 25 years from

now. former education secretary, margaret peoplings and education reform trailblazer, michelle rewir re, here to talk about t mickey d's hoping that elusive meal between breakfast and lunch could help slumping sales. so investors mcbet on it? plus your chance to know whether you want to mcbrunch is coming up. guys! you're not gonna believe this! watch this. sam always gives you the good news in person, bad news in email. good news -- fedex has flat rate shipping. it's called fedex one rate. and it's affordable. sounds great. [ cell phone typing ] [ typing continues ] [ whoosh ] [ cell phones buzz, chirp ] and we have to work the weekend. great.

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to many americans, september marks the beginning of a school year around put the spotlight on america's educational system. >> part of our year-long cnbc 25 initiative, celebrity our 25th anniversary, looking at how things may be 25 years in the future and looking with our education system. with us is sharon epperson and two guests, former education secretary, margaret spellings and former d.c. chancellor, michelle rhee. it is all yours. >> i'm looking at the situation of the future of education and where the k through 12 classrooms are going to be in the future and very interested to hear from you, ms. spellings, about where you see the schools going and whether you think this

individualized learning approach that some schools are already engaged in will be the wave of the future. >> well, i certainly hope so and i think it has the potential to, just as personalization and customization and competition has changed really every area of american life, whether it's banking or ordering your coffee irk we will see some of that in education, i hope. and it's about time. you know, we will see students move through their academic curriculum at their own pace, not determined strictly by their able, but really more by their competency and their proficiency. we will see teachers be able to meet students where they are because we will have more rapid feedback on data and where the child is and we will also have customized curriculum products that you will help meet the individual needs of the students, so i think it's going to be terrific and phone sex really great and we are seeing lot of t >> the issue is about trying it to get the funding and the training for teachers necessary to see that type of individualized learning is one many critics say will take us a

long time and perhaps more than 25 years to get there. what are some of the obstacles perhaps in getting the community to accept this in terms of getting the proper training and funding for our schools and our school districts? >> well, you know, i am sure michelle will weigh in on this -- >> i think this -- >> michelle? >> yeah, i think we have a major challenge on our hands right now because in this country over the last two to three decades, we've more than doubled and almost tripled the amount of money that we are spending per child in public education. and yet, the results have really stagna stagnated, we haven't created an environment where we have made a case for an increase in funding for public education quite yet. i think what we have got to do is bring more transparency into the situation. we have to understand very clearly what the return on investment is of what we are -- what we are spending those dollars on and then once we see that i think we will be able to make a case for more dollars in education, particularly for professional development for

teachers. >> and michelle, if i cork it's kelly evans here, jumped in and ask you a question, i know you have stepped down from studentsfirst in the last month or so. an interesting piece, they take you to tax and perhaps margaret weigh in on this as well and they say, look, the core of the problem is child poverty and a lot of this focused on issues and measurements and metrics with the primary education system overlooks this core problem and that this has been more of a distraction than a help in getting to the root of the issue. >> look, i think that there are lots of people thought who say we can't fix public schools until we fix the problem of poverty in this country and i actually think it's the exact opposite. we have to create a public school system where every child has an equal opportunity at success if we are going to break the cycles of poverty in this country. so is it more difficult to educate children who are living in poverty? absolutely. we need to acknowledge that and put the resources toward ensuring that we are giving kids

the resources and supports they need but it can't be an excuse for why kids aren't achieving. >> yeah, i acompletely agree with that absolutely, and hello to my friend michelle. the other thing is it can't be an excuse for educators to not meet the needs of these children. we have to make sure no matter the condition of the child -- >> not to interrupt, but the criticism is not that we should say well, these kids are born into poverty and so we shouldn't expect more. no, no, no. what they are saying is the resources in this country should be devoted toward trying to improve the poverty level and for these families, for these situations, as opposed to thinking that education itself is the problem. >> you know, in my many decades in the field, there's never enough money. i mean, that's sort of a hollow

argument. yeah, sure we need more resources for kids but, we have to have our eye on the ball with results for foreign minority students, above all. >> and the reality is that we have to -- we have to look at this in terms of what do we think is the best way that we can break the cycles of generational poverty in this country? and, you know, you can have social programs, you have have food banks, all of those things that address the symptoms, but at the root cause of it is how can we ensure that the next generation of kids who are growing up in poverty can live different lives and the only way that's gonna happen is they get a high-quality education. >> we all know college costs too much. and we are here to talk about what we see education looking like 24 years down the road, 25 years down the road. how does this play out, madam secretary? are people just gonna say i'm not going to college because it costs too much, i can't afford it right now? will they go elsewhere to get the education that they need or

what happens to the college industry itself in this country? what do you think? how does it -- >> i think we are moving away from pedigree and more toward competency as determined by employers. it's not going to be enough for a university to simply present you a piece of paper and say you're ready for the work forces. i think employers are challenging those of us in education to be able to have students demonstrate those skills and competencies that they can put to work right away. so, that's why we are seeing things like badging and assessments and competency-based models that really, you know, are your portfolio that prove you have the skills necessary to work on day one. technology is helping us do that. some of the things that we are talking about in k 12, these adaptive models, will help us in higher ed, too, but the employer is gonna drive whether this -- whether the student is capable of being employed or not. >> so, is that, do you think, going to perhaps do away with

some of the universities that we are seeing right now? if you're not able, if you're a tuition-based university, you document have the elite, you don't have the prest teen of a big-name university, you may not have the cost savings that you are able to offer of a community college, those in the middle, would they perhaps go away if we are looking at more of this focus on a vocational training and perhaps online training? where do you see that taking us 25 years from now? >> they are absolutely gonna have to adapt and change. i mean, these models that we have now are unsustainable with these tuition increases that outpace health care, the cost of living and every other thing, those are unsustainable models. so, i think you'll either change, those institutions will change or they will perish. >> and michelle, how do you think the model's gonna change, or do you? >> well, i think that with all of the changes with massive open online courses and the like, universities are 100% going to have to evolve with the times. the old models of just assuming

that kids are going to come into those institutions, attend for four years in the way that they used to because that's, you know, what happened in the prior generation, is just not a sustainable model anymore. >> something's got to give, that's for sure. lady, thank you all for joining us today. sharon, thanks for hofrnl choing this for us. >> hey, michelle. >> hi. >> you should do lunch or something, the two of you. >> we should. >> and 38 minutes to go before the "closing bell." dow under pressure, 37 points, the s & p slightly positive, same for the nasdaq. >> for whatever reasons, americans keep losing their appetite for mcdonald aeshs the stock has suffered mightily as a result. now the fasted to giant's solution neighbor create a new meal segment, mcbrunch. one of our next guests says unless mcdonald's is offering him home is as, this is bound to fail. would that be a mcmost sa we are wondering here? don't miss your chance to vote on whether you would mcbrunch as

well. and a group of senators urging burger king not to move its tax address to canada after buying coffee and doughnut change, tim hortons, they say it is unfair and unpatriotic. both sides of that debate as well coming up on the "closing bell." kid: hey dad, who was that man?

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welcome back. 35 minutes left. thesome and p turned positive the last few minutes, as soon as our billboard gets out of the way there you will see is up a fraction at the moment. the nasdaq's down, half a point

still and the industrial average down 27 points. >> our dominic chu rounding up the numbers today. >> check lululemon, up 14%, a nice day for yoga pants. tam minka rose after eastman chemical offered to buy it for $2.8 billion in cash, $26 a share. also, blackberry gaining ground on news it was acquiring mow vert to you, a provider of virtual identity solutions, those shares up 5%. a check of mcdonald's, the fast food giant filed a trademark application for, get this, guys, mcbrunch, according to a government filing. the company said it was tooer will i do speculate on its plans. the stock is down more than 10% since hitting an all-time high of nearly $104 on may 14th but an interesting concept if you think about it, right, chemly, bill?

>> a lot of people chewing it over, thank you, dom f mcdonald's did roll out the brunch menu, we want to know if you would mcbrunch. go right now, excuse me, cnbc.com/vote, tell us what you think. >> meantime, get a couple of guests to tell us what they think, joining us to talk about more on this concept of mcbrunch, cnbc contributor carol roth and mark hake from hake capital management. carol, you are not a big fan of this? >> i like brunch in general but the whole concept of mcbrunch doesn't really resonate for me unless they have the mcmimosas you were alluding to. you think about what brunch is, is happens on the weekend, it is leisurely, it is everything that mcdonald's is not. and doesn't seem like they are listening to their customers, customers, for decades, have been saying make breakfast an all-day event. unless the mcbrunch is breakfast rolled out with extended hours, i don't think that this is something that's gonna move the

needle for mcdonald's, they have too many other issues to contend with and i don't think this is what you want to hang your hat on. >> mark what about you? >> i love everything that i eat at mcdonald's. i love their breakfast. and i love their lunch. and their dinner. i hope -- i hope they come out with a new concept. they said they are not testing anything. that's great. i mean, let's talk about the stock. it's really cheap, okay? it's comparable. it's cheap versus comparables, i would buy it here on the dips. >> why do you think it's fallen, mark? what -- have they -- >> it's the only dow stock in the red on a 52-week basis. >> suffered mightily here. why do you think that is? are they not connecting with their customers? >> yeah, well, their sales were on the comparable were down for july and august but if you look at those reports, it looks likelesslik like it's mainly due to the currency effect. >> they have got -- they have

got -- they have got foot traffic issues. they have less people who are going into the store and i think mcdonald's, has this amazing footprint is getting lost and getting away from being a leader. they are not a leader in technology. they are not teaming up uberfor delivery, not coming out with the apps or the data or even the loyalty program that we have heard about last year that we give them the big data, like starbucks has. >> but you're missing the whole big picture. the whole big picture with mcdonald's is it's a huge cash flow machine. 90 billion market cap, throwing off 5 billion in cash flow a year and they just announced in may that they are gonna pay out 20 billion over the next three years. >> understood, but you can have a cash flow multiple but if you want multiple expansion, you want to get the growth multiple, they are going to have to get more people into the stores and increase those comp store sales because with 35,000 units around the globe, they are not going to have more of these units being

built like a chipotle or like a starbucks. >> you like the menu, mark, but are they innovating enough right now? everybody else is coming out with newburghers and everything and mcdonald's has the same menu, tried salads for a while and then they gave up on that. >> what do you need to change? they have got 28 billion in sales. people love eating at mcdonald's. this is the largest quick service restaurant in the world. all right? all they have to do is change it on the margin to cater to the newest fad, but this is a massive cash flow machine. people are always gonna go to mcdonald's, always gonna eat there, anybody with kids and people like me that love it. all right? so -- >> mark, you know what else mcdonald's could do with 20 billion that's roughly the market cap of chipotle, is there any argument for reintegrating chipotle? >> no, they spun that off and i think that was the best move.

this is a company that pays out a very nice dividend. think of it as a bond. it pace out about -- they are gonna pay out about 7.3% of their cash flow every year for the next three years, and if you use a rule of ten, you basically double your money over ten years. >> what's your favorite item on the menu, carol? >> so, i personally like the french fries. you can get a small french fry for 230 calories. no sugar. it's very, very tasty and if i were them, i would actually add some cheese to that, get some nice processed cheese going, could have cheese fries, add to the margin that way. >> i know you like the fries, too, mark, but did you know how many calories were in that? do you count calories? >> who cares about that stuff? i love their big mac and their -- >> the american consumer cares about that. >> the strawberry shakes. the american consumer cares about that stuff and that is why chipotle is on a tear and those are the kinds of things that mcdonald's needs to pay attention to if they want to be

competitive next decade. >> our poll has closed, 52% said they would mcbrunch and mark, given everything you have said arguing for the stock, understood, but why again do you think it just can't perform well here? >> it's a hiccup, all right? and buy it on the dips. if you x out the currency, they basically ahead flat sales. all right. fine, but that's talking about the largest quick service restaurant in the world, 28 billion in sales. and yes, i had a he like to see sales growth and yes i'd like to see earnings growth, but their cash flow is massive, no matter what happens. and they are gonna pay it all out to the shareholders. >> that's true mcdonald's bull right there there you go. thank you both. good to see you. enjoy your lunch. >> you, too. >> once again, as dom told us, read the statement from mcdonald's, we are not testing a mcbrunch concept, it says. it still is entirely premature

to speculate about such a concept. as we mentioned, we routinely file intent to use trademark applications as regular course of business and we cannot share details tilt as to how the trademarks may or may not be used. >> people testing out the idea on twitter. look at some of the tweets that we have seen already about the mcbrunch. ted saying mcno, we are seeing a sad death of an american icon, failure to change by buying. mike said who was having brunch on a weekday? most people are busy working. brian tweeting, only if they are including mcbloody's and mcbellinis, a theme here. >> yes. people are not exactly enamered of the concept. floating a trial balloon, not hitting high altitudes now. we are hitting the market, we head toward the close, 30 minutes left, the dow is down 34 points right now. the s & p, well, it was positive a moment ago, it's back in negative territory. >> so, is today's rather weak jobless claims data a red flag the economy may not be improving as much as most people think? it does come on the same day as

some pretty bullish forecasts about gtb. paul mcculley here to sort it out next. >> i look forward to paul's visit. later, why respect small businesses hiring right now? cnbc's kate rogers will have the answer for us, she may have found, coming up a little bit later on the "closing bell." stay tuned. blp if i told you that a free ten-second test

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welcome back, we continue to search for direction with the u.s. economy, important releases including retail sales and consumer sentiment out tomorrow. >> all that ahead of next week's federal open market committee meeting of the federal reserve, as first reported on "closing bell", steve liesman says many now expect fed chair, janet yellen, to be more hawkish this time around, removing the key phrase they have been using for months now where they would keep interest rates at a record low for a prolonged period of time. maybe that comes out in this next statement. let's talk about it, what it all means, pimco's chief economist, paul mcculley is back with us here. paul, good to see you, welcome back. >> good to see you, bill. good to see you, kelly. >> what do you think? do they take this out and if so, is that significant at this point? >> i think a done deal they have

take that out before they hike. there are two phrases they have to take out. one is that there's substantial underutilization of labor resources and, two, that they will have a considerable period after ending qe before they hike. we know those two phrases have to change before they hike so therefore, the marketplace is telescoping forward the hype based upon the change of language that's potential at any time on those two phrases i in the next number of meetings. >> the hawks and the doves want to get rid of the lang badge with you they have two different outlooks on how rapidly the economy is improving. >> an important point you make that both the hawks and the doves are uncomfortable with the language because the language is

connected to the calendar and has been for a number of years, one way or the other. i think regards to where you are on the spectrum, you want to move to data dependency. you have both ends of the spectrum uncomfortable with it, but the real issue becomes are you a hawk or a dove, how do you look at the data and how do you measure resource utilization and also, quite frankly, when do you want to induce a correction and risk asset, a, a significant probability, when you change the language. >> do you think the data spores an end to quantitative easing and ready to raise rates? the two things they have been telling us to watch, the jobs numbers, the unemployment rate and inflation expectations and neither of those are where the fed wants them to be right now. >> i think the end of quantitative easing has been supported by the data for a very

long period of time. remember we have been in a very long taper and that's yesterday's news on the qe. today's news, as i told you, they will not even consider hiking rates until they finish qe and qe is finished next month. so, therefore, the marketplace, okay, we have gotten through this one, what's gonna happen next? and i think the economy is improving and a very meaningful sort of way and i think the fed wants to get off of zero. i really do. and i think it's the appropriate thing to do. but it's got to be a very delicate communication that they are getting off of zero because zero is not a normal interest rate whatsoever but that getting off of zero is not saying they are behind the curve, not saying we have an inflation problem, simply declaring victory on getting out of the liquidity trap. that's very delicate

communication strategy. january set very, very good but a big challenge in front of her. >> not to mention, paul, additional wrinkle now, which is the fact that you have the strong dollar, off lot of commodity prices declining, a lot of weakness around the world, the european central bank, bank of japan, perhaps trying to do more, that's weakening their currencies. in other words, if you bring this all back to what the fed might do in terms of monetary policy i argue as alan greenspan did yesterday on this show there's been some tight thing because of that. do you think that adds to hesitation on their part in doing anything further? >> i'm not sure i'd use the word tightening, i would certainly agree with alan the global environment has turned darker in recent months and the fed operates in the context of a global market. you look at it from a risk management perspective, the risk associated with getting off of zero is higher if you're doing so in the context of a weaker

global economy and a stronger currency. i think they want to get off of zero but they are in a risk management paradigm and the things that alan mentioned are risks that have to inform the decision of when they want to first change the language and b, actually lift off of zero. >> i'm curious, you use that word delicate, janet yellen is going to have to employ, the delicate strategy, start the process of raising rate, seem to start implying the market is not going to like it when it happens, what do you think the market response will be, equities and treasuries, they do actually begin the process of raising rates. >> i certainly wish i knew with certainty. >> you don't? the key issue is the bond market is a forward curve on the neutral fed funds rate. and the equity market is priced off of the neutral fed funds rate. here at pimco, we like to talk about the five year, five year

forward rate. so, if the fed can lift off of zero for the spot fed funds rate without getting a material move in the five year five year forward rate, i thicke you can have a pretty mild correction in both bonds and the equity market, so, that he is the key issue for her to get off of zero for the overnight rate, but without moving very much the five year, five year. >> maybe just whisper it or something. >> just a final question, 'cause i know we will want to dwell more on this as that time approaches, it is a question on more minds around here, including art cashins, as much as when the fed raises rates the question of how, what rate are we ultimately going to be talking about? do you think that will be an issue? >> think very clear that they will be running a car door system with interest on excess reserves, which they set categorically being the ceiling and then they will have a reverse repo rate as the

floor,le fed's fund rate will be in between. going to use the fed's fund rate as their communication device, we in the marketplace, i think, should look at interests on excess reserves, 'cause that should be the top of the range in which the fed funds rate will fray. >> those rates the banks actually pay. >> got that straight, everybody? >> always good to talk to you, paul. good to see you. >> talk about a communication challenge, can you imagine write statement, running for the reserve right now? >> like i said, you just kind of put it out there, whisper it a little bit. >> like mcbrunch. >> raising rates, not for a while. >> 16 minutes to go here, the dow is off 32 point, the s & p turned negative again slightly, the that nasdaq trying to hold on to a begin of less than a point. >> major averages have had pull backs of 5% at least this year so far but yet to experience the proverbial 10% correction is 5% the new 10% i heard kelly evans

say? >> i think it is 4%. later, did apple hit the nail on the head when it comes to the design of its new watch? famed fashion designer rebecca mink cough, her own line of wearable fashion tech accesso accessori accessories, will join us next. s of independent analysts... is that too much to ask? nope. equity summary score, powered by starmine, will help you execute your ideas with speed and conviction. and it's only on fidelity.com. open an account and find more of the expertise you need to be a better investor. so what we're looking for is a way to "plus" our accounting firm's mobile plan. and "minus" our expenses. perfect timing. we're offering our best-ever pricing on mobile plans for business. run the numbers on that. well, unlimited talk and text, and ten gigs of data for the five of you would be... one-seventy-five a month. good calculating kyle. good job kyle.

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welcome.back, a mixed day on the markets, the dow gives up 25 points, watching the ten year again for direction, the s & p is trying to hold on to small gains, same with the nasdaq. >> to bob pisani who is still regaling us with stories about his trip to venice. >> nobody knows how to have more fun than the italians, bill. not having a lot of fun in the commodities area, the big debate, a lot of e-mails flying back and forth, people flying back and forth whether deflation going on globally, gold, silver, copper, but crude turned around finally aft sear many down days, i think the problem here is simple, low demand, high reserves in oil, we know that the iea said that i think the real problem is really with the dollar, you know what's been going on here, the euro has been weak, the yen has been weak, really what's going on, the dollar index, you can see the strength in the dollar that we are hitting, the yen's going down against the dollar, the

euro going down, that's been a problem for commodities, and if we get some stabilization in the dollar, i think we will get a little more stabilization in the overall commodity market. meantime, big oil stocks generally to the downside today. a lot of them have turned around in the middle of the day though as oil turned around, most of the names down 4 or 5% for the month overall. take a look at a name like a whiting, the shale plays, they have been hit very, very hard this month. that turned around, too. a lot of these companies, these shale plays don't make a lot of sense if oil goes to the $80 range, but i bet you guys that's not gonna happen, a little stabilization in the dollar, already see people picking at these stocks because they have been down so much in the last two weeks or so. back to you. >> all right, bob, thanks very much. see you a little bit later, ten minutes left in the trading session here, the dow down 25, the s & p and the nasdaq have turned positive here. >> now, we have been talking about mcdonald's what about rival burger king? will americans boycott the chain if they incorporate in canada, post tim hortonen's deal?

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welcome back, about eight

minutes left in the trading session, the nasdaq and s & p positive, the dow lagging, down 25 points in today's trade. >> joining us, wayne wilbanks, and jeremy hill, welcome to you both. it occurs to me that we have talked a lot about the fed, we haven't really talked about ukraine and russia, haven't talked at all about the president's speech to the nation last night. is that because these ant are a factor for the markets here? >> i believe as long as the fed is gonna sit on $4 trillion worth of securities, all of these fundamental events are really the risk on trade takes those all off the table. amazing, you provide that amount of liquidity in the market, all this bad news and just rolls off. the market will know whether the news will get bad some time in the future. >> market taking it all in stride at this point. the fed meets next week, we have been talking about that, what do you expect to happen and is that an opportunity to buy the curves there

>> you heard the scales falling the eyes, credit and market participates are waiting for this type of wisdom to come from fed, wednesday, not only do we have the presser, but we also have the new dot plot. what is interesting, is if we get different type of verbal guidance but the dot plot stays the same, what happens at that point? >> for those who don't know, the dot plot is -- we get a little map to show where each of the fed voting members are in terms of being aer a hawk or a dove right now. their interest rate projections the next year or two, wayne, which is the question, not so much just about when that first rate hike might be but what follows and, you know, if they raise a quarter of a percent then don't really do anything else for a while, how much of an impact does that have really? >> we don't think they are going to be able to raise rates more than a quarter, maybe a half on the short end. every point costs the government $120 billion a year. you will see what happens already, the housing right now, you have mortgages -- mortgage

starts the lowest in 14 years, so they got to be very, very careful. they can talk one thing but the other side, you're not gonna see much. >> a very delicate balancing act. gentlemen, stick around, come back with both of you in a moment here, get to the closing countdown in a moment. >> that's right. after the bell, we will look at the rise in regulations and whether that is the main thing holding back the u.s. hiring activity. you are watching cnbc first in business worldwide.

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welcome back. heading into the last two minutes of the trading session here, a quick look at the dow, s & p, nasdaq, all traded much lower earlier in the session. the nasdaq and the s & p continue to move into positive territory, the dow trying to come back here, has come back quite a bit, was down 84 points at the low of the session. one other market that we highlight lately a lot because of the tremendous decline we have seen, except for today, price of crude oil which today is up 1.6%. so, somebody felt like it got cheap enough that they brought it back again. it's up to $93 on wti. back with our guests here. what about oil? it used to be that you'd say, wow, this is gonna be great for the economy, the price of oil goes lower but energy stocks have been so tied to the stock market lately that that could put a crimp on the stock market style.

what do you think? >> i think right now, one of the bullish cases for the u.s. is u.s. energy production and that's what's filling this gap causing a you will these things in the middle east to have very little impact. >> it is a game changer, isn't it? >> a complete game changer. i think we have so far estimated it, but even exceeded what our estimates would be and where it's gonna go as we move forward. >> i couldn't agree more. the one kind of thing you have to realize here is that oil is primarily going down because of strength in the dollar right now. there is a demand dynamic that's weak right now, but it's mostly dollar strength and so as we see that dollar strength continue, dxy at 84 today that could have a negative effect on corporate earnings as u.s. s & p 500 companies export, things get a bit more expensive for the buyers overseas. >> you think oil is destined to go much lower here? >> i think probably $90 levels, pretty strong support if you look at it technically and you still have an increase in demand every year.

>> gentlemen, thank you both for joining us here very much. we are starting to come well off the lows here as we head toward the close. the dow looks like it will finish about a 20-point decline, a little less than that, s & p and the nasdaq turning positive. that is it for the first hour of the "closing bell." stay tuned for hour number two with kelly evans and company. i will see you tomorrow. thanks. >> thank you, bill. welcome to the "closing bell", everybody, i'm kelly evans, here is how we are finishing up the day on wall street, the dow trying to turn positive at the close, art cashin saying there were considerable buy orders about you going out with a decline of 20. the s & p, higher by a point and a half, the nasdaq adding five. so, overall, a mixed day. let bring in today's panel. joining me now, tom joyce, former chairman of nightcap tall is here along with our very own sarah even and cnbc contributor, john hang in nairian joining us, "fast money" trader, guy adami. welcome one and all. najarian j

money" trader, guy adami. welcome one and all. do you see signs that we could be heading for more weakness, more choppiness? >> and look at germany, came almost all the way back. so, our market, you know, was approaching triple-digit, looked like it was going to be pretty ugly this morning, fought its way, almost -- well, fought its way all the way back, but didn't close in the black. but i see more things to be positive about here, kelly, than i see to be negative, as far as how the market reacted, how the buyers didn't desert, didn't just go running for cover, instead they did what they have done all year and that is they have bought when there's a dip like this to be bought. >> perhaps sarah, headlines the last hour or so, mario draghi, ecb president, saying ready to take further action if needed. >> look, that's what it's all about. strong dollar. that's the trade, especially against the euro and at japanese yen, at a six-year low, breaking through some levels, that's what you have to look at, this move, not just impacting the currency

market, hearing all day on cnbc, you have to watch for american companies, multinationals with global exposure, they are in the firing line, once you see them dollar materially weaken as we are seeing, into the federal reserve meeting next week that is going to be the key. there is not a lot of economic data this week. perhaps that's not why you are seeing giant moves on equities. next week, fed meeting, alibaba ipo, a huge test supply for this market, big things to be aware of, but that stronger dollar certainly the center of the action. >> alibaba, tomorrow tom, how do you think markets take that one down, reasonably well it looks like? >> hard for in he to say irk not exactly on top of it, to be frank with you. having said that the big ipos suck a lot of liquidity out of the market to me, this has been a market all about liquidity, look at, again, we have a strong dollar because the fed has been flooding the market with money, which brings us, we think, to the precipice, banks sleep, flooding of the market work,

economy gets stronger, the dollar stronger, a liquidity on a macrosense is a story with an ali baba microsense. >> a great point. actually one we have heard across all asset classes. guy adami -- >> yo! >> wondering if we are on the verge of higher rates potentially on the verge of seeing real liquidity accidents out there in the market? >> are we on the verge of higher sflats i will be the first to say the last five trading days in the bond market have been difficult if you're bullish bonds or think yields are going lower, which is the camp that i find myself in for quite some time and i think that's the camp that doc finds himself in as well. so, yeah, the last couple of days have been difficult to remain a bond bull. but i'm still of the belief that this is just a blip. we have seen this before along the way. and i still think rates are headed a lot lower. for whatever reasons you want to talk about it doesn't really matter, that's where i think they are going. in terms of what stood out to me today though was a resiliency the bank stocks which traded really well and the steel names,

look at u.s. steel on a benign tape, a stock that had a huge move to the upside, there still seem to be some great single-stock stories out there >> glad you brought up some of the metals a lot of focus on what's happening across that's set class, also, by the way, what's happening on the farm. on that note, let's bring in dennis g denn dennis garmin, what what is going on across the commodity space now? >> crowd oude oil reversed to t upside, very impressive. i pay attention to reversals such as we had in crude oil. that might have been an important low. two, we had a large usda crop report that came out today which grain prices have been under undue pressure for a long period of time, a wonderful crop that we are growing and soybeans and corps, we have got a weak crop energy it's huge.

crop prices are under pressure and today's was da report, as it's called, simply tells us the crop sizes are, in fact, growing larger and prices, as far as grains were concerned, went to new lows, new contract lows and they probably are going to continue to go down. the other -- finally, everybody wants to be or has tried to be bullish of gold in dollar terms and it just wears you out it is a bull market in the dollar and in that environment, a long die, strong dollar environment is always gonna put downward pressure upon commodity prices, especially wearisome to those bullish of gold. >> that's why i guess the essential question that i have, i'm sure the federal reserve is mulling is is this move -- are we at the beginning of this move? a sharp upward turn of the dollar, this matters a lot if we are the beginning or end of that move though. >> i think we are only in inning two of what could be a ten-inning baseball game. we may go to extra innings later. >> wow. >> i think we are just in inning

two, just started a bull market in the dollar. >> you can understand against that backdrop why the guys, bank of america, merrill lynch today are saying that they think gold here is taking lower, it could test below $1,000 an ounce here before all is said and done. anyone surprised by that? we still have any gold bugs out there? dr. j, tom? >> i i'm in the camp, kelly, on significant dips, this is not significant yet in gold, but on significant dips like back down to 1160 where it was last year on the lows, i'd be a buyer. am i buying any right here? no. i think it's trading more or less in a range 1220, 1320, spent the good portion of the year in the higher end of that range but now with the strength that dennis gartman is talking about, it is natural we'd see this, i believe. the resilience of gold, many point to the geopolitical tensions which are unusually elevated, as the bull case for gold, a stronger dollar, weakening gold, perhaps, what's holding it up and why it was so interesting to see oil prices, wti oil prices at $91 a barrel.

you would have said there is a trade war between return europe and the russia and the u.s. is engaged in air strikes again in iraq and syria -- >> the fourth consecutive president giving, you know, nationally televised address about our intervention in the middle east. >> so unusual. one place you could have seen it i want to point out, a 30-year action today, u.s. treasuries, pretty strong demand for that, saying today sort of buck the trend that we have been seeing on the selloff in treasuries, that was a sign there was a safe haven. >> glad you brought that up, i would love to get your take on the president's statement, the policy, when it comes to the middle east or the lack there of and the fact that is having on the environment and the broader landscape right now. >> well, you know, i'm not exactly a geopolitical expert but it seems to me that we have lost our geopolitical fast ball and whether it is russia or syria or the tensions with our strongest al like the middle east, israel, you know, the united states doesn't have the pull it used to have and that just leads to more confusion and

ultimately, without strong global leadership coming from the united states, the fact of the matter is nobody else ready to step into the void, i think ultimately, that could bring us into some economic problems. the interesting thing is, a lot of the hotspots in the world are not big gdp or gnp, you know excountries. obviously, russia is a very large one, but away from that, we have a lot of awful noise in the world coming on economic low spots. >> well, there are a lot of countries who i think wish their impact on gdp were high other is it would force us to respond, otherwise, there's frankly not a big stick out there. you know, i just would love everybody as well to respond to what dennis said, if we are in inning two out of ten in a stronger dollar move here, then guy, for example, what does that mean for people out there who may be looking at other commodities, at oil, at gold and anything else, by the way, for the s and p 500 generally? >> i think the oil move today is really interesting, as dennis

pointed outs it absolutely bucked the trend, despite the stronger dollar, oil actually closed higher. to me that's a good reversal, something worth watching, very hard, obviously, to be long commodities, basically have their backbone in the u.s. dollar, but i do think there's a police to be and i think that gold will give you a police to be at a certain point with sort of the same lines that doc was saying, but you just touched on something, you asked tom a question about some of the political noise that came out last night. decades ago, was speak softly and carry a big stick. that seems to have been flipped around in recent years, so i will end my little segment here with you on that note. >> speak loudly, in other words. the same thing that paul mcculley was telling us that he sees from the fed, used to be, you know, watch what i do, not what i say, dennis and now seems to be what i say, forget what i do do. nowadays, you have to be an

english major to understand what the fed is doing, instead of an economist, you have to look at the rhetoric involved. that is sad. as an ex-english major, that keeps me employed perhaps. nonetheless, we should be economists looking at what the fed is doing, now taking part in rhetoric. one final comment, take a look at what gold has done not in u.s. dollar terms, but yen terms, euro terms. your favorite trade. >> yeah, actually quite strong. we have to understand it for that fact t >> on that note, do you think that the fed's gonna change the language in next week's statement, the evidence supportive enough of the economy? quick last word? >> yeah, i think that the fed will drop the line, it will change its -- the context and till us they will be raising rates sooner rather than much later as we have been led to believe but next year before it happens. >> right. that goes back to the liquidity pointed that we were discussing, a lot to watch for on that front next week.

thanks, everybody, be sure to stick around and catch guy adami with the "fast money" crew at 5 p.m. on "fast money." they will be talking to donald trump, jr. in a first on cnbc interview. you won't want to miss that we are going to send it out to dominic chu in the meantime for a quick market flash. >> here is what we got, kelly, alliance data systems going to buy conversant for $2.3 billion in a cash and stock transaction, equates to $35 per conversant share at current levels much the stocks are currently halted now, how they were trading before the halt. you can see here. alliance data systems and conversant both in the advertising technology or digital marketing-type industries. these two.scan combining to make an even bigger player in the world of advertising it technology and digital marketing, kelly. back over to you guys. >> all right, dom, thank you. up and down, we seem to end up where we started when the smoke clears. dom will come back with the break down of this recent rally and congress once again doing nothing to help its do nothing reputation. it appears they will be heading

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stocks showing signs of weakness, the indexes hovering around record highs, every time we have seen a hint of a pullback, plenty of investors stepped up to buy. dom chu is looking at where the strongest buying is coming each time and he joins us with interesting data. hoofrmter what we got. all day, telling you about the idea there have been pull backs and three so far this year but none by more than 6%. let's take you through each of those three instances and tell you one sector that really had a nice -- a piece of nice bounce back after hitting lows. look at the materials sector, back in the beginning of this year, we saw a 7% pull back for that sector during the first of our downturns at the beginning of this year and then all of a sudden, that entire sector rallied by 12% coming out of it. so again, materials led the way higher after the first -- after the first drawback that we saw in the first part of this year. look at the second one, rebound number two the technology sector down about 4% during this pull back between april and july of

this year, down 4%, then rallied subsequently 14% off of those levels. the most recent rebound, number three, we will call it utilities during that time span, they were down about 7% during the pull back, august 7 to september 4th then they rallied back by about that same amount. they have been the best performing sector on the rebound after this latest pull back. so the question then becomes, which one is gonna lead the way higher during the next one? we have already seen a lot of weakness coming out of the energy sector, at least for the past couple of weeks as oil prices have lid. now, it becomes about whether or not those oil stocks that are down a lot more than the rest of the market maybe have a chance to rebound or do they continue to be weighed down? kelly, guys, by this overall trade to the downside for oil prices. >> dom, stay with us, if you would, dr. j, just thinking through this evolution we have seen this year from materials to technology, now utilities is utilities the sector you want to see leading the way in i any rally? >> probably not.

to guy's point, i know it gets under sarah's skin a bit, i believe we are going to see 22 out of the ten year, because i believe it's global pressure, i don't think it's about our fed. i think it's about global pressure on rates. as far as dom, who is doing great work with this research, i would say take a look at the beginning of the year, at the vix up over 20, which dom would note for us as well. dom, you fake a look at that on that draw down in the market, the vix up over 20, the next one, up over 20 or right up against 20 and this time, we are barely budge through 13 here and so people that are looking for some sort of a -- >> you say reading too much into all of this? >> just saying that these aren't gonna be the 5 or 7% draw downs that you are looking for, not gonna get that until you get more panicked in the market. >> tom, would you agree? >> oh, yeah, utilities have rarely been a market leader.

we just talked about the strong dollar, 22 in the five year, ten year, i don't know about that market, first or second inning of a really strong dollar that implies to me that interest rates are going up. the dollar is not strong because the world is seeing wonderful political leadership coming out of the u.s. the dollar is strong because they think rates are going up. interest rates go up, usually the market suffers, at least in the short term. if the market sees the performance of the -- the industrial sector is still strong, given higher interest rates, then it tends to rally. >> but that is what is interesting about the fact that u fills are doing well here. isn't the -- isn't the utility play typically one that actually is more about low rates, correct? >> yes. >> looking for that deal? >> you want income, wherever you can get it utilities are not the only ones, mlps, seen it in wreaths, the higher dividends, what we have seen the last few days that yields, i don't know if you want to call it a bottom, the last few days, selling and yields have been higher on the back of higher economic data.

we had jeff gunlock on the show on "squawk on the street" earlier this week, yields are bottoming all over the globe, so, if that is going to be your base case, it would suggest to me that the leadership is going to turn around. >> dom, want to respond to that, and by the way, the other moves that you talked about went on for quite a while, relatively speaking. it seems like perhaps we are at the beginning still of a move here for utilities or not no? >> you look at the overall picture, making a lot about this idea the trend has been generally to the upside ever since the depths of the financial crisis in march of '09, one sector despite all those u utilities and telecoms, technology one of those great sectors the middle of the year, rebounded off the lows, second of all, financials, i would pay close attention to the financials, not because of anything else, but because they are the second biggest waiting in the s & p 500 and another big reason, they look like they were about to take some of that leadership, underperforming, middle of the road performers for a while, they were already starting to show since of life and then all of a sudden,

concerns about those capital requirements and everything else over the past couple of weeks kind of knocked those financials down, if financials can find some kind of a direction here, that may tell us something as well. so, i would watch the banks and see if they do anything over the course of the next few months here. >> and be a better sign in terms of those watching the economy. thank you for now, dom. appreciate it when it comes to curbing tax inversions, treasury secretary jack lieu may be the only game in town now. harry reid set a vote by the senate any time soon is unlikely. larry kudlow and the panel weighing in next. it, wait, wai, does she have special powers when she has the shroud? no. guys? it's the woven one the woven one. oh, oh that gives her invincibility. guys? no, no, no... the scarlet king is lord victor's son!! no don't. i told you! you guys are gonna be so surprised when you watch the finale!!! you're so lucky your car has wi-fi. yeah...i am. equinox from chevrolet... the first and only car company to bring built-in 4g lte wi-fi

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we begin with a couple of after hours movers, dominic chu, what can you tell us? >> hertz, the rental car giant reached a agreement in principal to add three new directors with its board of directors, in return, carl icahn will not run a proxy contest against the company and just new details here, the three current members of the board will resign and be replaced by the new three, two of the board members will be part of the search committee that looks for a new permanent ceo of the company. her the he's independent non-executive chairman saying the hertz board believes this outcome is in the best interest of the company and shareholders. carl icahn wants to thank the hertz board for acting to expeditionly and agreeing to appoint three directors.

hertz shares something to watch here. out ta salon, moving higher in the afterhours after the company reported better-than-expected second quarter profits and sales as well. those out ta shares up by 9 1/2% off, kelly, of their after hours highs. back to you. >> a big move. thank you, dom. knife democratic u.s. senators are pushing burger king to abandon the idea of using its merger with canadian doughnut chain, tim horton's, a to move the corporate headquarters to avoid higher u.s. tax, according to harry reid, the chances of a vote to curb the company's inversion any time soon is not likely. so, now it may be up to treasury to put the kibosh on the moveser in term. i'm joined by jared bernstein and larry kudlow. welcome to you both. i think treasury is highly

likely to move, highly likely to do so in the relatively near future, perhaps in the next couple of weeks and i think that they will probably be pretty effective in reducing the incentive to invert. buy themselves without legislation can't stop invers ares, the proportion of shares that must be owned by new investors are but they can make precisely the kinds of moves that you mentioned, earnings strippingsi stripping and hopscotching, you bring back your deferred earnings to avoid taxtaxation, lot less profitable and dampen the incentive to invert pretty significantly. >> by the way, larry, another dampening move potentially could be if people start to for example, boycott burger king or other companies pursuing this. should anybody be doing that and what do you think about the moves from treasury stopping the practice all together? >> i don't have much to say about not going into a burger king. i mean, i think that's about the

stupidest thing in the world. it's not gonna have any impact. i just want to say one thing. kelly, i have been tweeting before the show, you got some new polls out today, you got some new polls out today that show a republican wave is developing. they are gonna capture the senate, may capture as many as ten seats. class warfare doesn't work and that's what this is all about. a democratic poll, this was bill galston's column in the "wall street journal," a democratic poll shows that class warfare shows it doesn't work. the gallop poll shows republicans are 20 percentage points ahead on terrorism and eight or nine points on prosperity. so regarding the treasury department, jack lew, he comes out in a couple of weeks, he has got to get comments on any regulations, they will only make small -- small changes, profit stripping really had virtually nothing to do with the inversion. i will say this for the umpteenth time, you want to

change this i don't like inversion more than anybody else. you want to keep american companies here, reform the tax code. lower the rate. lower the rate. stop double taxing foreign profits and make it a territorial rate and remember this, the workers, new studies are coming out left and right, it is the workers who are getting hurt the most by high corporate rates. let me jump in, first of all, pretty important factual point and we should check, but i think i'm pretty sure i'm correct about this, i don't believe that these changes require a comment period, typically, you ma i can some rule changes or executive orderers, there's a six-month period, as larry suggested. in this case, i don't believe that's correct. these rules could take effect pretty quickly. look, there's no class warfare here as far as i can tell. in other words, as larry himself said, i don't think there's a bunch of republicans running around saying we are all for inversions, we like when burger

king sets up its tax mailbox somewhere else. most members of congress, i believe, don't like this and most members, by the way, agree with larry and myself, by the way, that absolutely we need to reform our corporate code. but that's not gonna happen any time soon and if we continue to see all of these inversions we are going to erode our corporate rate so far, we won't bring down the rate. >> the gop gets those ten senate seats what do you think that means for -- >> tax reform. >> but also for inversion specifically? >> look, inversion will be part of the overall package. you don't need inversion if you get the tax rate down to 20, 25%. senate orrin hatch is the likely chairman, he is pro-tax reform and paul ryan is the likely ways and means chairman. that's why i try to suggest to you the other day, kelly, maybe i was a little -- i didn't need to be too, aggressive, the

politics of this thing are play nothing reform, put a reform bill on the president's desk. you don't need invers are as long as you stop double taxing foreign profits. >> one issue with what larry said, i want to be clear, many of the firms who are inverting pay far below the statutory rate of 35%, so it's not at all obvious to me that a 28 or 25% rate is enough an incentive for them, they are going after earnings string and hopscot hopscotching. >> i agree. he raises an interesting point, one we have heard from some of the companies doing this, about the u.s. taxing foreign earnings period. >> twice. >> it seems to me until that's changed, the incentive still remains to companies to switch their address. >> that's my whole point, kelly, quit double taxing foreign earnings. and by the way, foreign companies, foreign companies,

would come and invest in the usa if we had a lower tax rate. and i just want to emphasize one thing it is class warfare when jack lew starts talking about economic patriotism and the president himself goes after these corporations. they think they are attacking rich, corporate people. they are not. they are aing at aing workers. the evidence shows that the higher the corporate rate, 100% impact on the workforce. make changes here. >> interesting,ly larry and i had this very debate when we both testified in the senate recently. the most up to date research on this suggests that the incidence of the corporate tax rate falls 75, 80% on capital, not on labor. >> no. no. >> i disagree with the point. >> all right. we will come back. >> i happen to agree with you that we need a broader base and a lower rate, but if we continue to erode the base with these inversions -- >> we are not eroding the base.

for heaven's sakes, that is such a non-starter. martin of i goodness. >> the bill was scored, the bill was scored at less than $20 billion over ten years. so let's not be silly. you got $300 billion, corporate tax profits. go to the -- go to kevin hasset, go to the aei, kevin hasset, he has put the work out on the 100% impact on workers, maybe more than 100%. >> i'm telling you what the congressional -- you can bring your own number. >> whenever we get into the bat of the think tanks, time to leave it there and try to let the egg heads, if they will allow me to call them that, sort it out. and a lot's going to depend on how this changes in the weeks ahead leading up to those midterm elections, too. thank you both, larry kudlow and jared bernstein, to be continued, we send to dominic chu for a market flash. >> who her's what's happening, conner is sant shares reopened for afterhours trading, a minute and a half ago.

it was halted on news before that news turned out to be that it was going to be acquired by alliance data system forced 2.3 billion in cash and stock. that's about $35 per share. as you can see, shares are about $35.50, up 33% in the after hours trade. so we are going to watch it the trading is relatively light right now, about 57, 58,000 shares but still, this takeover, now the news finally disseminated, shares have opened, up 33%, kelly. back to you. >> that is a premium, thank you, dom. the dream of owning your own business is fast turning into a nightmare for some small businesses navigating a dizzying array of regulatory mazes, giving some entrepreneurs second thoughts. up next, we will look at just what companies have had to endure trying to expand and seeing if it's even worth the bother anymore. and the apple watch has people talking about wearables, but the fashion industry isn't waiting on the tech giant to lead the way. coming up, fame deed signer rebecca minkoff here to show off her entries into the wearable market. stay tuned. e

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they say in the statement that commissioner roger goodell called on wednesday evening and requested that they oversee the independent investigation conducted by former fbi director robert mueller. now, they agreed that the scope of the investigation should be aimed at getting answers to specific questions including what efforts were made by the league staff to obtain the video of what took place in the elevator with ray rice and his then-fiancee, to determine whether, in fact, the video was ever delivered to someone tez league office, and if so, what happened to the video after it was delivered. art rooney and john mara, his conclusions to be shared with the nfl owners as a group and we agreed. his final report, mueller's final report on the incident will be shared with the public. again, art rooney, ii, pittsburgh steelers owner, giants co-owner, john mara, overseeing the independent investigation that's gonna happen by former fbi director,

robert mueller. they have agreed to the scope and size of the investigation and they have said that once the final report is issued, kelly, they will make the findings of this report available to the public. >> thank you for working overtime this hour on a number of fronts. strict regulations turning the dream of owning a small business in this country into a nightmare for some entrepreneurs. kate rogers joins me now in her "closing bell" debut with that story. welcome, hi, kate. >> hi, kelly. so with issues like obama care and minimum wage heavien at minds of small companies, in particular, i looked closer at the stats behind the regulatory hurdles, many of which are keeping a lot of small businesses from hiring right now. first off, companies just have more regulations to comply with today than they ever did in the past. in fact, the national association of manufacturers released wednesday a report that finds complying with federal regulations costs americans, get, this $2 trillion in lost economic growth annually. and complying with these

regulations, including licensing, which is now done more heavily at the state level today, counties small firms with under 20 workers up to $11,000 per employee per year, according to the competitive enterprise institute. a couple of the more extreme examples here in some states, getting something as simple as a hair braiding license requires over 3,000 hours of training and the supreme court, they are going to hear oral arguments on teeth whitening regulations this october, as 25 states have ordered non-dentists to stop ordering the service. so given those numbers, kelly, it's not hard to see why the latest nfib survey shows that small companies, they are just not thinking things are going to be shaping up in the next six months. back to you. all right, kate, stay with us, full. guys, this all playing into, of course this debate over why do we actually, despite silicon valley, have more startups today, something fundment aally change, can i be cynical and suggest regulations are always too overbearing or tom, think we have crossed a rubicon here? >> i think everybody will complain about regulations at

one point or another in the course of their business career but pendulums do swing and we have seen the pendulum swing toen a extreme right now. can you imagine the supreme court is hearing an argument on teeth whitening? that's insane. why do regulators think they know more about the industry that they are opining on than the experts who are actually in the industry, executing within the industry? so, the regulatory -- the regulatory side is an affront right now to businessmen, large and small. i mean, i spent most of my career in financial services, there's no industry more overregulated than that. and it takes its toll. >> whether you want to classify it as regulation or not, affordable care act talking about small business and the cost, an economist, formerly cbo, american action forum, right leaning but did look at the cost recently on jobs and on take home pay at small businesses because of obama care, $22.6 billion anally is what he came up with related to those higher premiums.

>> kelly, just to jump in here, what sarah said, i spoke with one guy, his premiums went up by 48% this year and he is a recall intoer. so, he can't pass on those health care costs on to the consumer because his prices are set. commodities that he is selling, but it's really scary for these small guys. >> i don't know how you roll it back. kate, good to so you this hour, appreciate it. breaking news involving hertz and carl icahn. our scott wapner has the details. hi, scott. >> hey there, kelly, thanks so much. call your attention once again to shares of hertz which are rising now after hours on news that hertz has added three board members in an agreement with carl icahn. i just spoke with mr. eye can who told me the following, "hertz acted responsibly by adding three individuals who in the past have been active in identifying top ceos in companies like chesapeake, navistar, cit, motorola and forest labs, among others, which has greatly enhanced shareholder value in those companies." mr. eye can going on to say "i'm hoping companies will bring on

more board members who have proving willingness to take on active roles when necessary." a couple thing here, carl has an 8.5% position, all common stock now in hertz and importantly, he will not now wage a proxy fight at the shareholder meeting as a result of this agreement. secondly, hertz has also, as you may know by now, increased the threshold for tradering the poison pill to 20%, that from 10% and now, a search continues for a new ceo of this company. remember, mark fess sore rah, who was ceo, stepped down recently, citing personal reasons. there is a search ongoing for the new ceo there, the latest, a comment from carl icahn, happy with this news, shareholders seem to be as well, stocks up nearly 3%, kell. >> well put, thank you, scott. putting all day from the cantor fitzgerald trading floor as celebrities take part in firm's annual charity day. movie stars, models, athletes and traders alike raising money

to commemorate those who lost their lives in the terror attacks 13 years ago today. we will head back to their floor and talk with sean matthews, chief executive of cantor fitzgerald and company to find out how much they've raised, next. also, be sure to tune into "closing bell" tomorrow. i will be joined by emmitt share, the ceo of twitch, recently acquired by amazon. twitch ceo, it's a live video game streaming site with more than 55 million users, we will go behind the company's huge success and what it hopes to achoo he have with amazon. don't miss it. tigers, both of you. tigers? don't be modest. i see how you've been investing. setting long term goals. diversifying. dip! you got our attention. we did? of course. you're type e* well, i have been researching retirement strategies. well that's what type e*s do. welcome home. taking control of your retirement? e*trade gives you the tools and resources to get it right. are you type e*?

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welcome back, today is september 11th, a day captor fitzgerald now marks with its annual charity day, bringing out celebrities and star athletes. cantor lost many of its employees on 9/11. their offices were high up in the world trade center and our barry thompson has been at the event all day today. she is joined by cantor's ceo, shane matthews, with news on how much has been raised. mary? >> thanks, kelly. of course, been a great day here at cantor fitzgerald's trading floor in midtown manhattan. sean matthews again joining us today. thanks so much. tell us what you made. >> we are still tallying, but we think we are very close, the same as last year, about $12 million. >> okay. but tell us the total, because this is the fourth year that cantor's done this charity day, but bgc has been doing it for ten years, but over that, i guess you could say 14-year period, if you combine it had? >> well over $100 million since

inception. >> over 100 charities have actually benefited from this charity day. >> correct. >> it was a huge day. we had a great -- >> long day. >> long day, but a great day, full of a number of celebrities, i'm thinking idina menzel, mariano rivera, bode miller here, the olympic skier, henrik lundquist, what moment stood out for you? >> ben stiller, a conversation, fun guy, nice guy, got on the phones, just helped. you know, it's taking a sad day in a lot of ways and making it a good day and that exemplifies it in a lot of ways. >> do you feel you can sustain this type of momentum you have for this event? >> absolutely. we think a great day, the can us inner base likes it the employees like it, it's a win/win kind of day for the firm and we do a lot of good with that money as well. >> that is well noted, $100 million, more than $100 million. >> well over $100. >> 113, if we tote it all up. that's right. great job, sean matthews, ceo of cantor fitzgerald and co. back to you. >> thanks to sean and mary.

our thanks to you for the reporting on that all day and mercedes-benz fashion winding down here in new york city the wearable tech trend, as we know, is just heating up. rebecca minkoff is one of the designers jumping on the bandwagon, we will talk about what happens when fashion meets technology with rebecca herself. there she is, along with her brother, orrib, the ceo of that brand, right after. being a keen observer of the world has gotten you far, but what if you could see more of what you wanted to know? with fidelity's new active trader pro investing platform, the information that's important to you is all in one place, so finding more insight is easier. it's your idea powered by active trader pro. another way fidelity gives you a more powerful investing experience. call our specialists today to get up and running.

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or save you money we'll give you $150. comcast business built for business. welcome back. apple may transform the popularity of wearable tech with the announcement of its apple watch. beyond the tech giant wearable tech is in this season in all the major fashion designers are starting to jump on the bandwagon. with us in an exclusive interview is rebecca with the company's ceo ari. welcome to you both. >> thank you. >> even as people are debatable the apple watch show us what you've had here that you had on models during fashion week one of which is a usb charger, two bracelets, and the other does buzz notifications that connect with your phone here. >> so what we really wanted to do is bring fashion and technology together and make it so that a girl has a beautiful piece of jewelry she's excited

to buy and it has elements in it that how we in fuse technology and fashion. >> you're wearing the usb charger. hold this up to the camera for a second. you would never know. >> it's a really great fantastic bracelet that happens to charge your phone if you lose power. >> which is the one function most people most need and want in the new phone and this other one here, does kind of what that yo app does? it buzzes you when things happen. >> note fication bracelet. the idea if a girl is at dinner or in a meeting and supposed to have her phone away so she can focus and not be insta xwraming or texting, but a few people for emergency sakes she wants to be notified if they call or text this can let her know and she can be with the people she's with except for an emergency. >> how expensive in apple saying the apple watch 349. >> this is $120 and that's 60. >> wow. on sale right away? >> it will launch this holiday

season. >> this is amazing. what did you think when apple came out with the apple watch this week? >> i was happy that we announced something before they did. >> we're really happy. i think there's a push towards wearables right now. we're the dawn of it. with the internet of things. so this gives us a great opportunity to be in there and we think that for $120 and $60 a girl would want to buy it for jewelry anyway. that's our goal, creating things because they look good and eases her life is better. >> are you interested? are you going to buy an apple watch. >> i'm considering it. >> i might. >> this isn't necessarily an anti-apple thing. >> no. >> are we talking about having multiple things on your wrist or can only one win out here sp. >> i think a friend of mine coined a term, an arm party and i think you can have your apple watch, notification bracelet, charger and all look good together. >> i think also you have different occasions. >> right. >> a girl might wear her watch during the day but going out and wants to, you know, have a party or a nice dinner date might want

to put on her nice watch but have tech that's connected to her. we see, you know, within the real estate on the arm multiple possibilities. >> incredible stuff. i truly didn't realize this was upon us. thank you for being here. >> thank you. >> let us know how it sells this holiday season. and from retail sales out tomorrow to the fomc statement next week, we will preview those reports and what our panel is watching when we come right back. we needed 30 new hires for our call center.

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welcome back. time for a final thought with the panel. tom joyce is going to give us insight on whether scotland will secede from the uk. >> funny you say that. i was in ireland last week playing golf and the tvs over there get a lot of feeds from the bbc and boy was that on all day all the time. if you listen to the folks up in edden den borrow tilting toward remove themselves from the uk. as dr. j pointed out, they still have scotland staying in the uk. >> two latest polls. >> i think it's too big a bet. i think ultimately sanity will prevail and scotland will stay attached. >> it's a week from today. pressure is on. >> a lot can happen in a week as you know.

>> by the way, i want to go back, continuing to talk about these wearables we saw from rebecca and ari, i think you would wear one of those cuffs. >> and i might. because that actually makes a lot of sense to me, having something that would be a charger, a remote charger if you will, instead of having to have a heavy case or whatever you use to charge your phone to have some emergency power built into a bracelet, not so bad. >> yeah. i don't think i'm having an arm party on mine. >> i like the apple watch. i think it looks like jewelry. i don't know what function it's going to give me but i like the look. besides scotland next week, big week on the fed. tomorrow we get retail sales. this week's not over. it will be interesting to see if that turns -- this is headed for a down week and another strong week for the u.s. dollar which is sort of where we began. ninth week in a row. >> wow. >> and coming out of the one of the most unusual first halves in terms of the economy in the u.s. the first quarter shrinking at 4% annualized rate. the second quarter with the numbers if looks like it could

grow at almost a 5s% pace annualized. when you ivan it out it's about 1%. weird things perhaps because of obama care happening here. >> obama care, regulations, a lot of things point to washington that give us some weird results. >> well -- >> and we've got oracle next week. that's not the big one for my view of the overall market, though it will be fedex. fedex earnings next week wednesday will tell you a lot about how well, we are recovering. we get michigan sentiment, preliminary reading tomorrow but next week with fedex, that will tell us a lot more and tell us i guess how much the u.s. post office is cutting into fedex's profits with their new pricing. >> that's a point. tom, we were having this discussion continually about the role of high frequency trading in the market. it would be remiss to let you go without addressing it. give us a sense as to whether -- you brought up the liquidity point earlier. how much has the presence of the firms contributed or not to the

landscape. are things as bad as you ever seen them or all making too much of it? >> oh, i definitely believe we're all making too much of it. i think there is bad about behavior in the high frequency trading realm and if there is bad behavior it needs to be stopped. most high frequency traders work hard, they're kind of the modern day market makers if you will, almost replaced the specialist in a lot of ways. i think the retail investor should totally forget about high frequency market making and shouldn't think about high frequency trading, shouldn't think about trying to day trade. focus on stocks that makes sense to them, stocks, for example, that have a catalyst, catalytic event like a ceo or new product. the retail investor is not being harmed by high frequency trading that is done correctly. >> would you agree with that dr. j, take issue? >> i wouldn't. in fact, tom ran a firm that made parks then there's a big difference between making markets and those that are taking markets as well and to keep it fair, i think is the big

thing that everybody is looking for. that's what michael lewis if he did anything with that book, maybe he did that. >> thank you. we have to leave it there. watching the dollar, watching these reports into next week and watching "fast money" with mel his la see. >> we have the analysts who have the gal, the gal, to downgrade apple the day after the big product announcement. he's coming up. >> i like these cuffs from rebecca. >> they're not bad. >> over to you. >> "fast money" starts right now. live from new york city's times square i'm melissa lee. tim seymour, pete najarian and guy adam my. chinese internets on fire as excitement builds around the alibaba ipo next week. we'll have the details from someone at the road show coming up. but first, we are just three trading days away from a key fed decision. investors are looking for incite to when the fed could raise rates. in the last month the dollar index has rallied 3.5% and what's going on with yooelz. ten-year yield ticking hig