>> i just learned that. >> how come you're an expert? >> landed on a -- tongue by a portuguese man of war and hurt like you know what. >> i can believe it. >> lucky to be alive. >> i come from a nation of jellyfish. thank you for watching, everybody. we'll hand you over to "the closing bell" and hope to see you tomorrow. make sure you join us. welcome to the closing bell on this tuesday. >> you'll have to hurry to catch up with us. we started long ago. i mean, this is one of those days we can't wait to think of what's going on. a wild trading day. why are stocks rallying? depends on who you ask. one side reports from our friend that the fed is not likely to do anything different tomorrow. even leaving in that key phrase for considerable period of time. on the other side, though, you

have chinese central bng. >> people saying that people's bank of china injecting liquidity into the system and concerns of underlying the shakiness globally of markets and those macro worries of the chinese economy and willing to -- we should put it this way. one central bank or another or all of them. >> upstaged our own fed. >> other thing that's happening is a shocker in the hedge fund industry. the california public employees retirement industry, the nation's largest pension fund and done investing in hedge funds. this, again, one of the first to go into the investing in hedge funds. saying the results don't justify the high expenses. speaking to a reporter that broke the story and find out how the hedge fund industry is reacting. >> yeah. could be the tip of the iceberg. this's the fear in hedge fund in business. if the biggest goes, would others follow? we'll talk about that coming up. a lot of excitement, of course, the alibaba ipo on friday.

but our own herb greenberg isn't sold on the chinese e-commerce company. what a shocker. he's got questions about the factories, the profit margins, the complexity of the entire organization. do investors know what they're signing up for sbiing into alibaba? herb is not sure about that and will be here sounding off a warning you no ed to hear about. here's the markets on a final hour of trading with volumes higher we should mention than seen in a month and that has traders encouraged because the dow today earlier did set a new intraday high and the moment trading at 17,148. closing right around here, it will be a new record high. we haven't had a closing high since july. meanwhile, the nasdaq adding about 33 points to 4552. and the s&p 500 up 16, bill, sitting as we have seen so much of this over the last couple of weeks on the 2,000 level. let's call a quick audible. show me the russell 2000 and

it's up but it is lagging the others. in fact, even as the market began the rally earlier in the session, the russell still lower. that is an index, the russell 2000, the smaller companies in america that has been lagging this market lately. something to keep an eye on here. talk about it. closing bell exchange today with steve sax, ken moray, peter anderson, karen kcavanaugh and kenny p. what was this rally about? >> listen. just like you and kelly said. right? not one central bank, it's another. right? yesterday the nervousness of she was going to change the language in the speech and march versus june and everyone getting nervous and they were taking money out of the high fliers and, you know, today china last night starts adding money to

their economy and then today there's all this analysis that jnt's not going to say something and leave considerable in there. so bang. you have a rally going taking us back to resistance at 2,000 on the s&p. i think it struggles here right now. you have a little more volume and that's okay and not a major change in market psyche at the moment. >> i wonder, peter, if we are pricing in today what the fed may say tomorrow and then depends on if it's true and they don't make any changes and have we brought the gains forward? is that now increasing the risk of a selloff here? >> i really don't think so. i mean, you know, the fundamentals looking on the individual stock basis, there's plenty of stocks out there that are fairly valued. you know, it's a little bit of a puzzle what's happening today and sometimes i think looking too closely you might not be able to come up with a specific explanation. i'm expecting to take out that

wording and i don't think that's a bad thing. i think -- >> still? >> yes. still. take out the wording. i think that the next thing is focusing on using a scalpel or a sledgehammer in terms of how to raise rates a enthe next topic. how exactly are we going to raise these rates? we are going to use the fed futures. i'm sorry the feds fund rate or the overnight repo rate. that's the next issue. i look forward to that discussion because i think things are fairly if not undervalued in a lot of stocks, drnly stocks overvalued and still -- >> undervalued? >> yes. absolutely. >> karen, what about you? i mean, what do you make of what we're doing here? do you buy this rally? do you buy beyond the rally? >> i think you buy the rally, beyond this rally. right now, there's tug of war between good economic data and whether the fed raises rates or not. fundamentals are moving forward. the economy's moving forward.

things are coming in a lot better than expected. the only fly in the ointment is labor market and tighten up with the job openings. highest in 13 years but corporate earnings are poised to go higher and the market is poised to go higher. i say get in, get on the train while you can and it's a good thing. >> ken, if there's a couple of reasons to give people pause on piling in right now, you can cite the fact that bearish dropped so much. you can cite david at jeffries a friend of the show and rightly at the beginning of the year called far crash in volatility and now has come out saying he sees a pick-up into the end of the year as the fed's tapering ends and the quantitative easing ends. do you expect a pick-up in volatility here and how might it affect the market? >> this whole situation here right now reminds me of "the marathon man." laurence olivier torturing dustin hoffman saying is it

safe? is it safe? is it safe? i think the market is doing that with janet yellen. is it safe? is it safe? is it safe? it looks like it is safe. the hinting right now seems to be that so i think there's a rally but don't forget that the stock market is like a pet tiger. the moment you take it for granted, it is going to eat you for dinner so be very careful. >> i haven't been to the dentist since "marathon man," by the way. the equation of people's bank of china adding liquidity over there and talking about take away liquidity in our own markets here. what do you make of that? are you more inclined to want to invest overseas right now? >> yeah. i think right now, bill, a couple of things. we hit on it earlier and kelly said it at the top of the segment. if it's not one central bank it's another. there's opposing forces right now from a liquidity perspective and a quantitative easing and a

fiscal monetary policy perspective. china is a great example. right? they have been through the recession. lingered at the be the tom of the trough if you will. and it's a slower recovery and been a slower recovery. they have started accelerated. we have seen other parts accelerate and offsets to the fed both in developed and emerging markets that all tultiy lead to the markets, whether it's commodities looking attractive. ultimately i don't read too much into what's going on in each central bank each isolated way but a whole liquidity picture looks like across the globe. >> i'm surprised, steve, you see a benign global outlook. frankly, we haven't brought up the vote in two days on scotland potentially leaving the uk and the uk -- there's this survey each month of bank of america merrill lynch fund manager survey, finds that most

investors think uk is less exposure and think of the casino names selling off, steve, in other words, it seems like there are more risks to the global growth outlook than reasons to be encouraged by it here. >> no doubt about it. that's where you get the value from. so if you're looking at it from the perspective of you'd rather participate in a move that hasn't begun or is lagged other developed markets like the u.s., that's where investors are going to look for that particular value. there's no doubt that it's higher risk an higher volatility. >> so we have covered the fed, the scotland independence vote on thursday. what about that little event on friday? show of hands. who wants to buy alibaba on friday? anyone? >> oh yes. >> anyone? i don't see any hands going up. >> i don't want to buy it. i don't want to buy it but i think it's a positive for the psychology of the market. not just that deal, there's a lot of deals in the pipeline right now. >> you don't think we're top ticking it?

aren't they like the skyscraper index? when it goes up, that's, you know, the death knell for lack of a better word for the boom? >> what do you think, karen? >> i don't think so. i think maybe in 2007 just because we saw a lot of deal making and then the market crashed after that that people are trying to say that the same thing is happening now but this m & a wave, this is a sign of business confidence. people want to make the cash work for them so i think it's actually a good thing for the market and this is really all that wave of m & a and ipos is a positive. >> they're going to trade right behind us. >> right here and clearly a very exciting day. that being said, i think steve made the point. it is exciting and as long as it pulls off and they priced it right and there's a nice action in it, then i think what you will do is get some enthusiasm in the market. right? people excited about it. a deal that's gone very well and it says a lot about the coming ipos. a strong market. the guests said that.

that's a healthy sign for the market. going forward, i do think it's a good sign. alibaba is going to be a show on its own on friday and one that's going to be highly watched. >> peter, before we go, can you tell people the parts of the market that are undervalued? >> for instance, you mentioned macau peninsula earlier. the growth is slowing there. we own las vegas sands and we added to the position once they said that sales, outlook for sales to decrease because we think that's a viable market. i would like to add one more thing, though. let's think about the discussion of alibaba after the minutes come out tomorrow and see if that will impact at all the atmosphere by friday. >> it's all going to come together into one story by the end of the week here. thank you all for your thoughts on today's market action. appreciate it very much. with about 50 minutes to go and the dow near record highs,

up 119, the outperform on this -- no. i'm sorry. now the nasdaq and the s&p both up about .8 on the session. >> all right. when we come back, the big blow to the hedge fund industry. california public employees retirement system, largest pension fund in the country, says it is exiting all hedge fund investments over the next year. the pros will weigh in on whether the nation's biggest pension fund is starting a potentially seismic trend for the hedge funds. also coming up, one of the founding fathers of the exchange traded fund industry speaks to us exclusively about the etf and where markets go from here. plus, dominic chu calls out stocks that tumbled at least 20% since the recent highs this year. some well-known names are on his bear list. are they now buys? that's the question. something you can't afford to miss. stay tuned.

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welcome back. so the california public employees retirement system or calpers is putting hedge funds on the chopping block. the largest u.s. pension system and not investing with hedge funds. >> call pers says this is part of the ongoing effort to reduce costs in the investment program but now raising some questions with investors if this is start of something bigger. could other funds follow suit here? joining us to talk about, alexandra stevensons of "the new york times" and tim spangler and read about this as we all did. why are they doing that? to cut costs? >> hi. thanks for having me. >> you bet. >> you know, they cited in their -- in the announcement they put out yesterday two main

reasons for eliminating the hedge fund positions. one being complexity of their investments. these hedge fund investments and the cost. so i think those are the main drivers and they have been thinking about this and discussing this for the most part of this year. so it was somewhat flagged up but those are the two reasons behind it. >> by the way, i want to tell our view earls we want your thoughts on this. what you think about this issue. are hedge funds worth the extra expense? they do cost more than a typical mutual fund but the idea is that you make more on the other side. in terms of profitability. are they worth the expense? tell us what you think. cnbc.com/vote and conducting the vote interview here. >> question to you, tim. how significant, how much is this decision reverberating in the investment world? >> i think it's a very, very important development. clearly one of the early

adopters of going in and investing in hedge funds in a meaningful way and much, much too early to write the obituary for hedge fund investing generally or specifically. it was well-known to have a relatively small part of its overall pot of money in to hedge funds and we look at the numbers coming out. a lot of other public pension plans are putting in very, very significant sums of money. overall hedge fund industry is growing significantly but both the public pension plan and the hedge fund industries will have to respond to this. >> alexandra, there's a quote from our friend in your piece that caught my attention to get to the heart of this and defending the hedge fund industry and laying the blame on calpers saying they don't have the right staff or the right managers. ouch. >> well, listen. i mean, i don't think anybody thinks that they're unsophisticated. they're considered the

bellweather in the pension industry. so, i think it's a bit of an unfair criticism for him to make. but you know, the question is and the one thing that he brought up is whether this is a right time to be exiting hedge fund investments. looking at the performance of five years, hedge funds have consistently underperformed the s&p 500. >> yes. >> but we have been in a remarkable bull run. if that run is running out of steam, well then, you know, as anthony scaramucci and others argue now's the time to get into hedge funds. this is when you want to hedge as the market goes down. >> do you agree, tim? i mean, i sit on a couple of nonprofit boards myself. a couple of years ago, there was talk we want to get into hedge funds. i was against that but nobody was listening to me. now one has gotten out. the other is thinking about getting out. it is the cost involved and stuck with these things. the exit strategy is so prolonged at this point that you

can't be nimble in all of this. so, do -- i mean, calpers in a class by itself but other nonprofit funds, foundations and so forth, do they really belong getting into hedge funds, do you think? >> i think people have seen, we talk about the aggregation of all hedge fund managers and fact all managers have underperformed when you compare it to something like the s&p index. but let's be clear. these are backing individual portfolio managers, talented individuals. when you look at the hedge fund space, it is the top quartile and not trying to aggregate a group of passive securities, idle securities. you are looking at backing managers and those investors, institutional investor, family offices, high net worth, able to identify really the top quartile managers, they deliver high, high returns. regardless of what the market is doing. i don't think it's good to aggregate the performance and say all hedge fund managers are

created equal. they're not. most successful investors are backing the most successful managers. >> fair point, tim. just a question that this already will affect a lot of people in the market but so, too, will the decision that calpers an others make of where to reinvest the money. do you think people will then put this into the u.s. stock snarkt will they put it in private equity and other market kind of products? where does that money go here? >> i see the overall case for alternatives generally, private equity, venture capital, that's very, very strong with a wide base of believers in the market. i think to the extent investors move in and out of hedge funds, they're still going to be very, very committed to alternative investments, committed to private equity. i think they need to deliver consistently over long periods of time the high returns they need. >> we just closed the polls on

the instant vote by our viewers here. asking our hedge funds worth the extra expense. 70% said, no. interestingly. as we were discussing this whole process. >> interesting. >> yep. thank you both for your thoughts today. appreciate it very much. >> thank you. we have about 40 minutes to go here. >> yes, we do. >> the level we're watching is 17,138. >> that's the previous closing high for the dow set back in july. we're, what? 11 points above it as i do the quick math there. count on my fingers. private joke. anyway -- >> coming up next, dominic chu with a list nobody wants to be on. stocks that wiped out at least 20% from the highs this year and may contain surprises. are these some buying opportunities? stick around for this. >> what the founding fathers of the exchange traded fund industry, lee kranefuss joins

us. markets, global turmoil, where you should be investing and a lot to talk about with lee coming up. stay tuned. just take a closer look. it works how you want to work. with a fidelity investment professional... or managing your investments on your own. helping you find new ways to plan for retirement. and save on taxes where you can. so you can invest in the life that you want today. tap into the full power of your fidelity greenline. call or come in today for a free one-on-one review.

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that you already have. today there's a new way to work. and it's made with ibm. more than 80 stocks tumbled in bear market territory. at least 20% below the most recent highs this year. >> dominic chu with the highlights or we should say low lights, dom. >> here's the thing. like you said, 86 of the stocks in the russell 1000 large cap

index in the zone, sort to speak. a stock of the las vegas sands trading at over $88 a share march 7th. since then, down about 31% from those highs. it's been hit recently by signs of a possible gaming slowdown and analysts predicting what could be a 34% upside in the coming months, 12 to 18 months based on the average analyst price targets. the single biggest drop from recent highs belongs to new skin enterprises. this is the marketing company, it's dropped by over 70% since hitting 140 bucks a share back on january 13th. herb greenberg believes they're very vulnerable in china. despite the big drop, analysts still think on average this stock could rise over 50% from where it currently trades. let's hone in a little bit of what's hit hard in the recent pullback in stocks.

check out shares of tesla. the electric car maker down 10% since the market's recent high. not helping is a morgan stanley research report questioning whether the stock gone up very quickly in a short amount of time. it's momentum trade for a lot of investors and remains to be seen whether it's a dip to buy on. back over to you. >> captured the imagination of a lot of people out there. is the recent drop a buying student? is it a sign to go from bad to worse? >> here to brawl it out, charles sizemore of. welcome to you both, james, what do you think? >> thanks for having me. this is a unique opportunity i think to be a buyer of tesla. there's two reasons that we break it down in terms of fundamentals. demand side. no competition and no competition coming far luxury niche electric vehicle to compete on range with the model s. among other features. second, on the supply side,

tesla's led the way with front end loading facilities and the scaleability and the fact that it insources 75% to 80% of the production an higher yields versus traditional manufacturer and perhaps most importantly, the benefit of a reservation backlog and the key is to scale the labor and ramping volume over a year or two we think it's got a runway here that is very defensible. >> all right. charles, you don't like it at this point. agreeing with elan musk or what? >> i would agree with musk and say i admire him. he's a great ceo. built a great company but there is a price at which it no longer makes sense to buy it. comparing tesla to other automakers, not talking of fard and gm but high end. bmw and diamler. tesla trading for 13 times sales right now. you look at the german automakers trading less than 1.

bmw .75 times sales. so just back at the envelope, tesla about 26 times more expensive than diamler right now. and again, this is diamler. this is the maker of the b mercedes benz here. >> tesla is a trading as much as a tech company as an auto company. >> it is expensive even for a tech company but at the end of the day it is an automaker. making cars here. and you have to ask yourself. if the best case scenario comes true, if tesla really does take the auto world by storm, if tesla is the new standard here, how much is priced in here? right now the market cap, i didn't check it today. but about 30 billion. that's not far from half of what -- earlier this year, it was at half of what bmw's is. this for a stock that sells, you know, 1/20th the number of cars in a year and hard to justify

paying up that much. it's a great technology stock here. it does deserve a premium but not a premium that big. >> it's a market cap and $32.5 billion. james, what about the comment by elon musk, unusual for a ceo to say something about his own stock price and did say it's ahead of itself. it's expensive right now at these levels. >> by the way, second time he said that. last time it was $170, $180 a share. it's not much usual about elon and why we like him and the company and other presenter's commenta commentary, tesla as the benefit of two key tail winds. takes share of traditional luxury vehicle auto manufacturers. think about the s class mbw. the model s is curb appeal far beyond what they provide. second, tesla can bring a new consumer to a higher end $1

$100,000 plus price point. it's a disrupter. only disrupter to invest in to talk about smart vehicles and autonomous manufactured vehicles down the road. so there's a -- >> before we go -- >> a whole host of reasons why i think the comparison -- sorry to be so long winded, a moot point at this point. >> part of the concern is its ability to ramp up in china given the supply con strapts of trying to expand in china. how much is the story a part of your thesis. >> nothing new and i would note he's buy rated and it wasn't a downgrade either. absolutely chi innachina's kric lining up in china and markets where we haven't started talking

about japan, australia. quite frankly, the underdeveloped world, the higher echelons of the income stream of south america. there are years of reservations still on order, you know, there's issues in the short term? sure. we'll watch them quarter to quarter. nothing to keep us concerned. >> two smart arguments on both sides on tesla. that's how it goes with that company. for sure. thank you both for joining us today. >> thank you. by the way, a slight correction. we were calling calpers largest pension fund out there. it's the largest public pension out there. the teachers fund in california remining us they're the largest pension out there. happy to make the correction there. >> we should add, again, focusing on what big wall street firms are doing, it's the institutions of $300 billion under management and even if it's 1% of the portfolio, talking about a big move. >> lot of money, for sure. making money bullish on the market today.

the dow up 109. we are in record territory. but we're starting to get close to that right now and up, if we were to close right here, new record high for the dow. >> keep an eye on that with half an hour to go. janet yellen and co kick off the two-day policy meeting, what might come out of the meeting got murkier. steve liesman tells us why and trying to clear things up. also lee kranefuss speaks with us about the explosionive growth in the etf industry and where you should be investing there coming up. [ male announcer ] automotive innovation starts... right here. with a control pad that can read your handwriting, a wide-screen multimedia center, and a head-up display for enhanced driver focus.

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we have a developing story of anheuser busch and the nfl. >> it's a huge inbev sponsor in the nfl ranks so they have come out with a statement about all of the controversy swirling and the nfl with regard to the ray rice situation, also the adrian peterson situation, a lot of these headlines being wrapped up together. anheuser busch's statement saying, quote, we are disappointed and increasingly concerned by the recent incidents that have overshadowed the nfl's season. we are not yet satisfied with the league's handling of behaviors that so clearly go

against our own company cull cher and code. we shared concerns and expectations with the league. perhaps a more stronger toned message to regard to what they're say to the nfl and joins comments of other sponsors with regard to how to wait and see with the nfl situation. >> dom, just quick. are you aware of any sponsors that have pulled their sponsorship of the nfl here? >> right now, there has been no big sponsor that's yet pulled out of the nfl sponsorship agreements here. that would be a huge situation. these are, again, comments made by these sponsors with regard to how they're viewing the situation. this is, of course, one of the stronger worded ones we have seen from a major sponsor within the nfl, guys. >> i'm told and i haven't checked this but radisson apparently pulled the sproip with the vikings which, of course, is involved with the peterson controversy over the last week or so but that's the extent of that in terms of

spro sponsorship. >> mcdonald's with mcnuggets and fries saying proud sponsor of the nfl. thank you for now. >> thank you, dom. one of the most successful etf is rue ro stoxx 50. and now source is set to launch this etf in the u.s. one week from today. under the ticker estx. >> joining us right now is lee kranefuss at source and often called the father of etfs. hello, father. dad. >> dad. a number of these but glad to be here. thank you. make me feel old. >> what took so long to come to the u.s.? why now? >> well, source is a very interesting business in that it's a consortium. it was built by morgan stanley, goldman sachs and jp morgan and the focus on europe and i can

tell you when they formed it it was the competitor i was watching most diligently. there were reasons to do that in europe at the time and part of a global ambition and the past year, i was affiliated and bought in and inevitable to expand to other markets. number four in europe. growing quickly. an open architecture model to go anywhere looking for the best indexes and the best investment content. >> this is about giving the u.s. investor exposure to europe's 50 biggest companies. why should they want that right now? >> especially right now. >> diversification. nice about etfs. take both sides. if things are going negative, go short and also hedge a position. most important, though, is that the indexing world is stuck 20 years ago. today the s&p 500 over half the revenues overseas. half the expenses. the stocks 50 is the index that european investors use as the measure of the market in europe.

most of the etfs in market are the dad's ololdsmobile. it's the same as clients over there and the first in our entree into the u.s. >> how have etfs changed the nature of the investing and the markets now, now that the individual can buy a basket as they can efficiently? i mean, i'm not doing the sales job for you but how has it changed the nature of the markets as they become more popular? >> they have really changed the way people think about investing. from individual stocks. i mean, we have alibaba coming up. people are excited about individual names. but particularly, advisers, whether it's brokers, s & a managers, think in terms of asset allocation. i can get clients exposure that we joked is broad diversity of a billion dollars for us. now you can buy exposure to

countries, regions, all sorts of things and ten $100 chunks and now on to the next generation of etf product. it is an innovation. >> are you familiar with motifs? >> yes. i know of the portfolio solution, yes. >> it seems to me like and it's funny. the way that we were just discussing how the hedge fund fee structure is too high given the performance. etfs are that way. most people including warren buffett said they think is the best tool for investing. motifs arguing it's lower fee structure and exposure to a more specific group of names s. that the next chapter of this evolution? >> i think that's trying to serve a different market. etfs played well when people needed diversification. people found themselves on the wrong end of the trade. we remember the ones that went up. people had, for example,

worldcom or enrop thinking they were good high quality bonds an went to zero. lehman paper. a lot of those. great wealth is made by concentration. great losses come from it. etfs are a diversification tool. a low cost way to diversify and we expect to offer more and more open architecture solutions. partner with anyone. we're independent. it's all we do. etfs. and so we think we bring the next generation of marketing tools to the market. >> we were talking about people and talked about this yesterday on the show, people who are anxious to get into alibaba, they can't if they're planning to do it through an etf. it won't in an exchange traded fund right away. >> i think you're right and how it's listed in the indexes and the needing the first day to happen. >> missing out on an opportunity in the industry? you make your own rules here. >> well, you know, i wish i thought about this earlier myself. >> you have until friday. >> i think it's short for the

filing. i'm sure people file soon after that on alibaba. >> good to see you. >> thank you very much. >> appreciate it very much. >> about 18 minutes left in the trading session. the dow, we're wondering now whether we're going to close at a new all-time high for the industrial average. sitting right above it. >> yeah. coming up, when's the real outlook for the economy and is the market rallying because the fed will keep easy money in place? steve liesman will join us with an important preview next.

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all eyes on the federal reserve to set monetary policy. >> steve liesman us with results of a poll of wall street pros and where they see the fed and the economy heading. what did you find? >> bill, we have been reporting about hawkishness on the part of the group and now i want to show you along with the hawkishness comes bullishness on the economy. and stocks. our first meaningful upgrade to the gdp forecast in about nine months, since january, you can see flat or down. and we reached down to 1.9% for the forecast for 2014.

pretty good upgrade to 2.3% as we have had the better numbers come in on the economic reports. and of course, for 2015, they didn't get quite so pessimistic and back up to 2.9%. the chance of recession? the second lowest since we have been measuring this in our survey. we can go back to 2011. when it was 36%. that's the probability of a recession in the next 12 months. back in 2011 it was quite high and come down and i want to focus on the area right here. two surveys ago, the absolute lowest and now pretty much within the margin of error at 15%. when's the big problem? substantial changes of what people say is the number one threat facing the u.s. economy and european -- the concern about a european recession is about half. 12 to 6%. maybe that domes on the back of ecb actions and pronouncements recently. the concern of tax and

regulatory policy, about the same. number one problem about doubling is concern about slow job growth and the impact on the u.s. economy, bill. so they moved ahead to june 2015 from july. the expected time of the first rate hike and that's come along with a better view on stocks and a better view on the economy. >> little more optimism there. before we let you go here, this rally some feel in part driven by reports out on what the fed may or may not do. what are you hearing? >> confused set of expectations tomorrow. the survey showed 41% of respondents think the phrase considerable time is taken out of the statement but this's the plurality and same time a majority thinks it's a later meeting. some talk about this issue of significant underutilization. i don't think the fed wants to signal rate hikes any sooner. i think and i have heard doves

and hawks say this. they want the move away from a calendar date promise and make sure the market is dated dependent, not date dependent and removing that considerable time phrase would help them do that. same time they're very wary of spooking the market and bringing forward expectations for higher interest rates. >> well put. thanks, steve. >> thanks. >> see you later. >> ten minutes to go here. the dow off the highs and that's an open question as to whether we close at new highs here. we haven't done it for the dow since july. we need to close at 17,138.20 or higher. >> art cashin signaled the bias is flat. neither up or down at this point. the market's holding steady. listen up. the russell 2000 of small cap stocks may be sending investors a very important signal. we'll break it down for you coming up in a moment. stay with us.

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going to be a squeaker. the dow sitting virtually -- well, now below the all-time highs. so right now -- >> slipping away. >> watching carefully to see if we can finish at an all-time high. 17,138 and change.

>> as people try to glean signals, the russell may be sending an important one. dom chu, not a good sign. the one you're watching, is it? >> this is a basic concept within technical analysis called the simple moving average or you refer to it as the dma. 50, 100, 200-day. the trend lines of the overall market. here's the chart that we're going to show you. what you are seeing is the longer term trend line or the green line if you can see there. and then the shorter term trend line or the 50-day moving average of the stock market. what it could be doing is crossing and when that happens, some traders believe that it signals worse times for the underlying index ahead. so, the russell 2000 is at this level where it could bounce and bounce higher bouncing off longer term trends. that blue line could be a signal if it goes maybe to the downside, something called a possible death cross. if that does happen, all that

you need to know is some market technicians believe that we could see worse times ahead for the small cap stock market and, bill, kelly, people look to small caps viewed by some as a leading indicator of the overall market. >> thanks very much. heading toward the close. seven minutes left there and we are fulling back so we're below the levels to finish at a new all-time high on the dow. >> we await alibaba. after the bell, is it alibaba or ali-buyer beware? herb greenberg skeptical of the company and perhaps the biggest public offering of all time. you'll want to hear why just ahead. way to "plus" ourlooking foa 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. you just made partner.

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♪ imagine a company's future with the future of trading. company profile. a research tool on thinkorswim. from td ameritrade. three minutes until the close. very interesting trading day. we weren't expecting much from this market day until tomorrow when the fed announcement comes out around 2:00 eastern time. we got fireworks, though, here in the late morning. here's the dow. quiet open we had. about what we expected and then suddenly around 11:00 eastern time, markets started to take off. two things, a report that maybe the fed isn't taking out the key phrase for considerable period of time when they make the announcement tomorrow. also word that the people's bank of china injected liquidity into the five largest banks so, you know, china taking steps to try

to shore up their economy pushed foreign markets higher, sent our market higher, as well. stocks went higher. what went lower? dollar, dollar index started to move lower. there's that move there and finishing down a fraction there. some of the commodities, oil higher as a result today and, well, the wti crude finishing up 2% in today's trade and copper, one of the most economically sensitive metals out there. look at that. took off. which some thought that was some short covering but we did hold the gains there with a gain of 2.4%. terry, oliver, appreciate you joining us. what did you make of the trade today? very interesting, wasn't it? >> i thought very interesting because, you know, i didn't expect china to make a move like that. i don't think anybody did and we saw the spike. but i think that, you know, copper is indicative of the fact of looking for the economy to pick up strength.

>> traditionally that's what that would say, radiosfigt. >> very bullish and looking good here. >> oliver? >> we're both bullish an think it continues to see a dovish fed. you're seeing global growth pick up in spite of what's happening in europe right now. overall, the selloff and some of the commodities and the strength in the dollar, temporarily overdone. >> right. the next three days, very, very newsy time frame. the fed and the news conference tomorrow. thursday we get the scottish independence vote. friday, the alibaba ipo, largest in history. how will you trade this? >> i think going to see a big jump in vog tillty. i think you will see indicative of tops, volatility pick up, as well. the news items on top of that. a lot of volatility this week and wind up being a very positive week and going to have your moments up and down. >> again, dovish fed. that should help lift stock

prices further. scottish independence vote, i don't think it's going to happen. voters are voters. >> could trim the bullish mood for a day. thank you for joining us. so we're not going to get an all-time high for the dow even though it's an intraday high earlier in the session. 100-point gain for the industrial average. s&p almost back to 2000. stay tuned now. second hour of "the closing bell" with kelly evans and company. thank you, bill. welcome to "the closing bell," everybody. i'm kelly evans. not quite going to get there and close at a new high for the dow jones industrial average. we needed 17,138 and then some and going out with a gain of about 100 points today but leaving us about five points shy of that all-time high. the closing high in july, an intraday high since including today and the close we can't capture. nasdaq up.

the s&p up about 15 and closing just shy of the 2000 mark. ahead of big news events with the panel, mark lapresi, danielle hughes, herb greenberg and cnbc mad money trader and joins us now from london. so welcome one and all. brian kelly, just get us started here. significant, when's more significant, that we hit the new highs on the dow or we couldn't close again at a record? >> actually, i don't think either of them are significant. when's significant is "wall street journal" said everything about the fed meeting and not changing the language. they're concerned about spooking the market. and that's all the market needed to know and, boom, off to the races. >> does that mean, herb, priced it in today? there's nothing but

disappointment awaiting us tomorrow? >> didn't we price it all in yesterday and talking about alibaba? this is a market that ruled by the hope and hype of the fed or next big ipo. the amount of noise out there and everyone's trying to sift through. we know from every single day now this market continues to feel, i'm sorry to be the guy to constantly say it, that just you know there's blowoff coming here. rates are going higher. we know, maybe not tomorrow. we know, we know. >> bernanke recently saying i think morgan stanley private event saying i think the 10-year should be at 3%. i can't figure it out. >> 2.5% now? >> just under $2.6%. >> there's no question that the market heard today what it wanted to hear. the fed is going to make sure that we have a very soft landing as quantitative easing comes to an end. when's the big question. it's going to be gentle and enough to -- >> maybe for the economy but

perhaps not a soft landing for the stock market. >> i love -- i like this very much. brian, what do you think about this? >> no. >> we had a choppy economy and smooth markets. do we now flip that and have a choppy markets and a smoother economy? >> no. i think the fed told you today we'll have a smooth market. that's what they're most worried about. there's no reason to say this. the economy -- >> david, to his credit, called the crash in volatility the year says going into q4 and beyond we'll see it pick back up and see the rally. you don't think he's right about that, bk? >> he said? >> volatility is picking up. >> voluntarily toll till? of course. that's part of the exit strategy for the fed, right? back in 2009, they withdrew volatility from the market and slowly reintroducing it. all i'm saying is that the fed and the market more importantly is clearly focused on the fed. nothing else matters. the economy doesn't matter.

nothing. all the market cares about is the fed. >> danny? >> we are forgetting, too, this is a global economy and maybe entities like china have something to do with it. lousy economic numbers. china, beginning of the year, everybody predicting china running the show globally and that prediction hasn't happened. we have seen lousy numbers, industrial production. we have seen lousy real estate numbers. just like everybody else, china invested, overinvested in everything. that drove commodities and huge, huge corporate debt in china surpassing u.s. corporate debt and unlike everywhere el, they don't like to lose face. >> we did see and these two things happened around the same time. talking about the fed perhaps not changing that language, but also china's central bank injecting liquidity into the five biggest banks. we did see a big reaction in the

commodity space and argue it's more to do with the injection. art cashin says he suggests perhaps something to do with the big chinese ipo hitting market. speaking of saving face. >> could be. i think you're right, kelly. also going not just to the big chinese banks but the local banks, too. that is new qe method for china and i think that helped ease everyone so i think that's another reason why the u.s. markets are up, as well. >> i wonder how much we are underestimating the real event on thursday being that the scots vote for independence. >> yeah. and the fear is definitely rising ahead of the referendum, kelly a. lot of uncertainty orion what will happen if scotland gains independence and what do people do with uncertainty? they speculate. they play the what-if game and not just citizens. investors are doing the same. in fact, some of the guests on cnbc today said they're booking

profits waiting for the vote to finalize. others say we're see a big move in the currency market and recommending clients to short the pound ahead of the referendum. i also want to point out tweets we're getting today? i'm investing in mcdonald's and other u.s. stocks. scotland not only has significant impact on the uk but it could have broader implications for the eu and seeing a rise in pro-independence campaigns in other nations and similar talks of what's happening in belgium and italy. >> people, mark, on one of the mailing lists follow for silicone alley joking whether they or brooklyn are next if the scots succeed here. >> probably brooklyn. i question how much the fear of the imminent collapse of the eu. i think this is overstated. i think that you are going to see the scotland referendum and

vote for independence on thursday. >> wow. >> in the currency markets. very limited impact in u.s. equities with the exception of stocks with exposure to that economy and largely for the u.s. markets something of a nonevent. >> bk, do you agree if they vote for independence it's a nonevent here? >> no. i would think that would be a shock to the market. i don't think the market's prepared for that. i don't think it would be a big enough shock to say, hey, this is over. it's a shock to the market. >> would it be more of a knee jerk? classic knee jerk to get on every single one of the events, brian? >> yeah. i think -- >> you have it for a day, maybe two. >> put it this way. if we're down 2% on scottish yes vote, then you buy the market. >> but that's exactly what i'm talking about. this market survived isis and gaza and israel. scotland's independence? i don't know. the knee jerk.

>> just to throw contrarian point out there with companies and multi-nationals supporting the no campaign and the uk to stay together and a political analyst today said that scotland gaining independence might not be such a bad thing politically. help ease tension of the brits and the scots and also allow scotland to focus on their economy and focus on issues like social welfare and wages which are two of the big reasons you're seeing the yes campaign gaining momentum. >> i wonder if this isn't a market point and apologize and if there's the buddhist -- wherever you go there you you are aspect of the votes for independence and in other words, you know, this whole idea that the grass is greener, that scotland or any entity on its own is necessarily better off. it seems the real question, danny, i wonder, if they were to do something like that, can they create a singapore-esque entity

in that part of the world and just like singapore with the independence of malaysia and tax policies and rather controversial government policies in order to bring capital into that location, would scotland pursue something like that? >> capital flows increasingly global. we are seeing that more and more and companies going to the greener grass because as you said tax issues and other incentives are more beneficial to corporate growth and in tune i think that, you know, people, humans are benefiting from that to a large degree because it's investment in sports and retail, et cetera. >> interesting point. we have to leave it there. i wanted to know from your point of view, do you go long or short china here? what do you think? >> long the market or short the market? i'm sorry. >> the chinese market, long or short? china growth story. >> i think the better way to play it is short the australian dollar on any rips. they have more -- the china

growth story is changing and you have a consumer led and australia will have some problems. >> all right. we'll leave it there for now. catch brian kelly at 5:00 p.m. talking to a top oil analysts about picks in the refining space and won't want to miss that. we have some earnings from adobe in fact. josh lipton with the numbers. hi, josh. >> just reporting and get you the numbers. adobe reporting 28 cents on 1.01 billion. now, the street was looking for 26 cents on 1.01 billion. so a beat there by two cents and just meeting expectations on the top. ado adobe, of course, maker of design software. so importantly, adobe saying an exit of qp and subscriptions that is an increase of about 502,000. marketing cloud revenues, 290

million. the stock enjoyed a nice run up 18% year to date into the report and giving some back here in the after hours. back to you. >> thank you. alibaba getting ready to rock wall street with what could be the largest ipo of all time. counter herb greenberg to explain why he's a skeptic. value of retirement plans for baby boomers actually fell from 2010 despite the big market rally we have had. what's behind the drop and all of us should be concerned about the lack of retirement funds across the country. you are watching cnbc, first in business worldwide. 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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welcome back. president obama talking about the ebola threat moments ago and jon harwood with the details. hi, jon. >> president obama wrapping up remarks at centers for disease control in atlanta. he told the american people that the chances of an ebola outbreak in the united states are extremely low but he said it's important for him to send the 3,000 troops he's sending to help with logistics and help the 3 african countries most affected principally liberia by the outbreak necessary to keep the thousands of ebola victims from turning into hundreds of

thousands and that america has a unique capability to help. >> faced with this outbreak, the world is looking to us, the united states. and it's a responsibility that we embrace. we're prepared to take leadership on this to provide the kinds of capabilities that only america has and to mobilize the world in ways that only america can do. >> reporter: now, before visiting atlanta, president obama met with kent brantly, the doctor from the atlanta area who was afflicted with ebola while treating patients over there. he said the doctor looks better, stronger and that was an encouraging note for everybody to hear, kelly. >> all right, jon. our heart goes out to those workers heading to the region. for now, thank you, jon harwood, in washington. t-minus three days until alibaba makes the debut here.

you may be surprised the find out what you're buying. kayla explains. hi, kayla. >> hi. 43 pages of prospectus describes the risk and a section in that ipo document, it's a common section but alibaba has one unique difference and risks about the corporate structure and split in two parts. one china-based entity with licenses to operate the websites under chinese regulations and a cayman islands entity and shares in the cayman's entity, that shares company revenues, grants much of the control under the umbrella you're looking at right now to alibaba executives like founder jack ma. critics say ma could choose to rearrange assets allocation. congress highlighted the risks of the investments and congressman bob casey discussed today on "power lunch."

>> these were shell companies giving investors contractual claims to a firm's profits but don't legally grant them ownership of the company and among the concerns we have and i think a basic question of investor protection disclosure. >> reporter: taking on a structure is one of the only ways to chinese companies can trade in foreign markets. half the country's companies, half the trade in the u.s. have the structure and common and take into consideration when the shares come available later this woke. >> all right. kayla, our thanks. that adds to the concerns many have surrounding alibaba and what may come as no surprise, herb greenberg is skeptical about this. hang on. he'll tell us why in a second and also joined by robert lunar who's a baba believer. anyway, robert, hold on a second. i want to hear herb first.

because of the structure, herb? >> a variety of things to think about. for instance, kayla talks about the prospectus. how many investors practice prospectu prospectus? i said it's too darn complicated. not just corporate structure. you need a whiteboard to really pull together what this company is and to understand it. you see company of an operating margin of 43%. that's a remarkable number. why isn't it closer to -- you have to ask, why isn't it closer to priceline or ebay which are considerably lower? what's going on there? subsidized by the chinese government and then my final point is this is a company that brokers things. just remember something. china has a variety of different grades of plants. you don't where the product's coming from or made or what it has in it. the liability issue hasn't been

touched on by anyone or the potential liability issue, possibly some point in the future. just so much here. doesn't mean it won't be a big winner. so much here. >> that's the little claus that's interesting about this. robert luna you say if they can afford to run portfolios without an alibaba position, you're sorely mistaken. is this just -- is this crowd mentality at the worst? everybody's piling in because they're convinced everybody else is deexcite the objections herb raised? >> well, you know, it is just a stock like i said that they have to own. i mean, if you're looking to play the chinese consumer, the way to play china is to play the emerging middle class. over 500 million of them there right now. the first time that the u.s. investor really had a direct play on that. e-commerce there, alibaba dominates. over 80% of the packages on the road right now coming from t-ma

subsidiaries of alibaba. traffic to alibaba jumped by over 40% there. that's three times of what you are getting of ebay. so, you know, to herb's point, if we base our investment thesis off of the average investor, we would be in trouble. i mean, it is complicated. yes, it is. >> can i just say one thing? in a bull market you should add. >> yeah. in a bull market. i mean, a lot of people talking about this top ticking the market as a big ipo. could have said the same thing about facebook. the s&p since the time facebook came out, up 50% since then. the structure is similar to what buy view has coming out nine years ago. there's lot of same talk of hearing from alibaba. that stock's up 1,800. this is a stock growth investor wills own. >> i called herb contrarian because as you know most

investors are pretty bullish about alibaba here, aren't they? >> they are because of the china story and so many consumers in china using alibaba and will. 60% of the traffic in china's because of alibaba. the structure itself, there's no economic interest that investors and the cayman islands entity in actual alibaba. that concerns me but that's as you said before that's all chinese structures and nothing that prevents the chinese government to all of a sudden say, you know what? we're not doing this anymore. not that they would do something as drastic as that. >> the pride of having the biggest and most successful ipo. >> let's also notwithstanding the structural issues and we were talking of a whiteboard big enough to undo the prospectus and i read quite a few of them in my life. >> i thought you were going to say having a big whiteboard. >> also important. 61% of the proceeds are going to the selling shareholders.

>> very good point. >> that's -- we have an obligation doing what we do here on cnbc to let investors know. buying equity in alibaba. you are not buying equity in alibaba in this ipo. >> robert, last word. can you respond before we go? >> same thing could have been said for buy view. up 1,800% since the ipo and comes down to price. between $60 to $80 probably a great deal to you. near 100, maybe a 15% to 18% upside. i can get that on disney over 12 months. it's all about price. getting ipo shares, buy it. don't pray up over $85 for this stock. >> we could keep this going. trying to find more time. still time before friday to explore this. robert luna, thank you for now. >> thank you. >> we've got a market flash here with our dom chu. dom? >> check out boeing, nasa announced partnering with boeing

and spacex, the company for commercially owned and operated space taxi that is are going to fly astronauts to and from the international space station and a maximum $4.2 billion going to boeing and spacex. you can see boeing shares up in the after market. but remember, kelly, right now in order to get up to the international spaceation, you've got to use russian soyuz rockets and tension of russia and many parts of the world at least, especially with the u.s. and meant to alleviate some of the need for russian hardware to get people to and from the international space station. kelly, back over to you. >> indeed. thank you very much for now, dom. also keeping an eye on adobe shares slumping after reporting earnings off to the tune of 4%. josh lipton has more. josh? >> yeah. so adobe reporting qe-3. a beat on the bottom. company now giving q-4 guidance

and eps, a range of 26 to 32 cents. revenue was disappointing. q-4 guide there, 1.025. that's a miss. the street wanted to see more like 1.09 billion and see the trades lower in the afterhours. back to you. >> all right, josh. thank you very much, josh. and alibaba not the only stock feeling herb's wrath today. wait until you hear what he says about sears with a ceo's hedge fund and mainstay on herb's worst ceo worst list. and a new survey with a list of the best places to live in america. may be surprised by which cities are topping the list when we come right back.

if energy could come from anything?. or if power could go anywhere? or if light could seek out the dark? what would happen if that happens? anything. i have $40,ney do you have in your pocket right now? $21. could something that small make an impact on something as big as your retirement? i don't think so. well if you start putting that towards

your retirement every week and let it grow over time, for twenty to thirty years, that retirement challenge might not seem so big after all. ♪ 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*? now looking at shares of racks slumping after hours. what is the story? >> racks based shares dropping big in the after hours. company announcing it's ended the strategic review of alternatives and remain or committed to remain independent and also, again, named the current president taylor rhodes as the new ceo. the company saying in a comment basically that, again, going to committed to staying independent. we are, quote, more focused than ever on expanding the leadership of the managed cloud market and we think the best way to do that

is remaining an independent company. that perhaps not resonating with certain investors. the shares down by 17%, kelly, in the afterhours. we have reached out to racks ace for comment and waiting to hear more from them and back over to you. >> thank you, dom. herb, quickly, what do you think is the story. >> this is yellow flagged. they couldn't find a buyer. rumors just the other day to come along and buy them. yet again. i just think this is a tough business they're in. think near a business increasingly commodityized. that would be my read. i expect they have a different interpretation i interpretation. >> emillennials out of the hous. mom and dad's house, that is. where to? giving them tips with a new survey with the list of best places to live in the u.s.,

diana. >> that's right, kelly. fewer are bunking in the parent's basement. good news. still historically high, 31% according to analysis and slight decline and not starting a household. more are moving in with other family members and home ownership rate fell to an all-time new low and moving and will spend $600 billion on rent alone in 5 years according to a brand new study by the demand institute. so if you're an investor, you should know where they're going, right? united van lines tallied up the results of the busy summer moving season and found chicago, d.c. atlanta, boston and l.a. led the pack in the most popular moving destinations. interesting that d.c. ranked number one city that people are leaving but such is the nature of this town. now, granted these are all big city markets and some are looking for more mid sized or smaller cities with a better quality of life. which are the best? well, madison, wisconsin.

ro chuser, minnesota. arlington, virginia. boulder, colorado. and palo alto, california. rounding out the top five. livability.com looked at 2,000 cities and their amenities, demographics, economy, transportation and housing. now if you want to see the full list, it is online, of course. realitycheck.cn realitycheck.cnbc.com. >> good stuff if you will because we want to bring on along with the panel, josh altman. great to have you here. when's going on? what's the story in l.a.? >> hot. hot market. inventory still very low. typically in a good market you have six month's inventory. we are four months. still seeing houses selling close to driving price. >> we hardware about hollywood and struggling and how movie and show production moved to other cities and new york and nowhere on that list. >> we are in that lucky sfi and

we have a lot of overseas clientele coming in. investing the money. you know, it's one of those places where people do want to live as you see on the lists. look. i love palo alto. that's great. i'm seeing that money coming into the l.a. market, the. >> diana, what surprised you most about this list of places, the ones that were on there or weren't? >> well, actually, i mean, what surprised me is most locking at the smaller to mid-sized cities and nsa that they're mostly college towns and interesting because that's not just a millennial but a baby boomer move and talking about this that the boomers are starting to retire to the college towns and means they're pushing the student housing out and prices are going up in some markets like rochester that you would never think of. of course people moving to l.a. chicago, the big markets out there. but again, you know, they're really being driven by the international buyer and i wonder how long that's going to continue, especially on the very high end.

>> well, one of the questions i have is the international buyer could be going also to greenich. you're up in l.a. there's big demand for the, say, beverly hills. rancho sante fe, they said they're not moving the same way. would you expect that to be since they're so close to one another? i don't understand. >> what's changed? >> well, i feel like as far as the -- you got to be in an area where -- i agree with you on rancho sante fe and i have listings there and it's slowing. the college thing is great. it's the booming cities. i think in any market they're hot. you know? you have overall compared to the rest of the world, new york, you know, los angeles, they're actually cheap when you compared to london and other places and why the overseas money is coming in to invest and safe enough. >> i would suspect that modern

infrastructure has to do with this, as well. you have a lot of demands for the millennials have on what they need, what their needs are in the future and cities that actually invest in real productive assets and things that actually move the needle in terms of what people are going to want in the future is a big deal. >> i just want to go for a second to greenich, a place where a lot of people we have on the program live or have lived in the past and a friend doing client meetings said to me a couple of weeks ago, you know, more and more people are saying they want to be out of greenwich and maybe rent it out to be in new york city or a lower tax base even and i'm just wondering what if anything to glean from this? just a greenwich problem? >> large estates. depending on the age, when they want to trade down, the problem they're having is they can't sell the darn houses and looking and no one, the millennials aren't buying the big estates.

you have a change in the market. wall street is not feeding it. people want to live in manhattan rather than living out there and doing the commute. >> if i could add to that, you're looking at the down sizing 0 of that upper tier. it's one thing to have the great estates in greenwich and fantastic but really the mind-set right now even for the very highest end of the market is to get a bit smaller but be in that perfect location, the top of the building in middle of manhattan but a smaller space and luxury. >> medium priced in colorado a great house for $500,000. palo alto, median price is a million dollars. so it's, you know, somewhere like boulder is more affordable. >> what's interesting. see the recent studies and josh probably knows better than i do, the continued rez didn't shl movement of new york city and becoming an actual retirement location that you're seeing more and more retirees choosing new york as a police. >> why? why? san diego. why would you choose new york as

a -- doesn't make sense. >> not on the list. we have to leave it there for now. diana, thanks very much and josh, as well. really appreciate it. coming up, when will people learn? a resume fabrication and walmart landing a senior executive out of work. it's a story burning up cnbc.com today. we'll give you details and also where it places on today's hot list next. we have seen a huge bull rally over five years and so how on earth did baby boomer retirement plans actually decline? it's another red flag. that of a retirement crisis is looming and coming up. c. so sometimes i need to find an easy way to express what's most important to me. like, with my crew, i use shorthand to talk to them and tell them what i need... and when i need to talk directly to my fans... but the most meaningful shorthand of all is the one i use when i'm about to drive: "#x." it's an easy way to tell everyone that i'm about to drive. and i do it every time before i get behind the wheel.

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welcome back. happened to politicians. cent babble coaches and radioshack to name a few. inaccurate resume cost an executive this time at walmart. website users have been interested in let's go to managing editor allen wastler. >> that story is strong for us all day. 42,000 people looked at it. i have to admit, i was wrong. i told my staff this morning, only media types like us doing it. it's the chief spokesman for walmart to step down.

up for a promotion and then the reviewing for that promotion, they found out he didn't really have the college degree he said he had. the situation a lot of people apparently interested in. my theory is walmart in a headline just draws them right in. but right now, it's really burning up the website the nfl story where one of the chief sponsors anheuser busch said it's not satisfied with how the nfl is handling the ray rice and adrian peterson scenarios and now the pirates story of yesterday. the u.s. joining a 20-person coalition that's -- actually 20-nation coalition to start basically policing the area of the straits outside of singapore more forcefully. trying to get the pirating out of there. walmart was really surprising, kelly. >> that's true. allen, thank you very much for now. coming up, 40 1(k)s not so

okay. saw the balance drop $10,000 in real terms from 2010 and why next. also, sears one published a christmas catalog of the wish book. now some wondering if the survival is about wishing and hoping, too. this from the hedge fund that runs the struggling retailer next. financial noise financial noise financial noise in a we believe outshining the competition tomorrow quires challenging your business inside and out today. at cognizant, we help forward-looking companies run better

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no 401a assets saved at all but balances fell between the years 2010 and 2013 for households nearing retirement despite the huge rally in the market the last few years. some reaction now with our resident retirement expert sharon epperson joining us with our panel. so, sharon, first of all, what do you think accounts for this drop in 401(k) balances among those households nearing retirement in the last couple of years? >> key is nearing retirement. and keeping in mind that the 401(k) system works really well putting that money in consistently and leave it there but you are able to take it out after age 59 1/2 without paying a penalty. so as you near retirement, it is yours to take out. you won't be penalized for that and you will have to pay taxes on the regular money. but what some folks may be doing, also, allowed in the system, as well, is that as they get into financially tough times or at least as they see it, as financially tough times, they

take out 40s loans and nearly 24% of folks taken out a 401(k) loan and not emergencies. paying bills is important. down payment for your home, a home improvement. medical expenses, surely can be drastic, as well. but to buy something special? i mean, i was speaking to someone the other day saying their family member taken out a 401(k) loan for christmas presents and not why you should tap into the 401(k). a lot of folks are not getting advice about what they should do about retirement until they're almost there. and we know that that's perhaps too late if they haven't been doing the right thing all along or not too late but takes them a lot longer to reach those goals if they start getting that advice at a later period of time. it's planning more time of a vacation than retirement. >> that prolonged vacation or at least it should be, danny.

for so many people seems further and further from a reality. >> right. you know, if you look at the past five years or so, we just have not gone up and no rise in wages. although food inflation gone up and automotive inflation have gone up and a lot of other pricing really risen in the face of, you know, stock market gains and people are not putting money to work and putting money to rest in the bills to pay and baby boomers and this is another charles schwab study done last year about 60% over them less than $100,000 saved for their retirement and about 38% or 36% have less than $10,000 saved for their retirement. >> one of the shames that pensions went away. it really is. because it was forced. it was there. you didn't know about it. you woke up one day and had a retirement. as idealistic great as it sounds, it's hard for people to get through it, to understand

it. you can go on fidelity website and i have a fidelity 401(k) and sometimes i look at it and say, i sometimes have trouble managing part of this. how's the average guy going to get in there and figure it out? they made it better but not necessarily intuitive to a lot of people. >> no. >> people don't realize -- >> there are many company that is are now offering some type of professional advice. whether it's a real person to talk to, some type of online service and more and more surveys showing charles schwab and many others that people aren't taking advantage of that. whether or not there's good marketing on the part of the companies or not taking advantage of it. they have other things they think are more important and important to look at whatever advice is available. start with perhaps the online add rice that may be free from a company. go to some of the websites and' what tools they have available. and then actually hire someone and that's the other thing. people don't want to spend a

part of their assets. not sure if they have enough money saved for retirement to begin with and don't want a percentage of that to pay someone when the reality could be that they could make more money with the right kind of advice. >> you wonder if it's the next bailout of taxpayers to be faced with. fascinating and unfortunate end to the great effort to privatize retirement. we'll leave it there now and continue to follow the story. thank you. focusing now on the stock specific stories, sears taking a hit today. the struggling retailer borrowing from chief executive hedge fund and discussing the future of sears next if it has one. tomorrow, the federal reserve convenes, wraps up the two-day policy meeting. diane swonk will talk about the issues of the fed. we'll be right back. when change is in the air you see things in a whole new way.

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welcome back. so we couldn't quite close at a new record today for the dow jones industrial average, but there were some big movers, nevertheless. >> there certainly were. let's start with humana, which moved higher after it announced

a $2 billion share buyback program that extends through december 2016. it previouses a program that still had about $780 million remaining on that program. energy stocks rose. exxon mobil, phillips 66 and con co phillips all gaining ground in the day's trade. we'll end here with sears. investors not really impressed with the company taking a $400 million loan from ceo eddie lampert's hedge fund. back over to you, kelly. >> all right, dom, thank you. a 10% drop in sears? >> what's remarkable is so much of the stock is held by two people, by eddie lampert's organization. it still has this impact. i think people are saying look, he's the one who's got to keep bailing it out. how long can he keep bailing it out? >> why is this a bailout? >> because obviously they need more money to get from here to there. why else would you do something

like this? some people say also, by the way, is there a conflict of interest here in what he's doing because of the way the thing is structured? look. what we know is this. sears -- we knew it from day one. we knew it early on. when they bought k-mart, it's never -- eddie was known and is known as a great money manager. i don't know him, i've never met him, but he's not a retailer. what we've learned is how hard it is to run retail. this thing was going to become a real estate deal. it's not a real estate deal. it hapt been the real estate deal it's supposed to be.sn't b deal it's supposed to be. you go to the shopping center, utc in la hoya, you park at the sears lot when it's crowded. you walk through the very empty, depressing store and then you go out into the crowded mall. >> you brought up the real estate point. that's what's so interesting about this.

>> if you look at the details of the terms of the loan as i did, it's a pretty sweet deal. i do have similar questions as you heard, about the conflict of interest. >> well, it's a conflict of interest to him. i mean, to the major shareholders, in effect. he's given money to himself. he's bailing himself out. so that's a conflict, but it's a wink-wink not a conflict. >> what about the minority share interest holders? >> there's so few of them relatively speaking. did the minority shareholders really matter here? really, seriously. they can walk away if they don't like it. what are they in this for? >> they are walking away. >> finally they're losing faith. >> it's a company that has clearly been continuing to struggle to be relevant to compete against the wal-marts of the world. it's a slow, painful death. >> and you have the dollar stores, you have the wal-marts, and you have the jcpenney. not only does it not smell like a jcpenney the way it used to,

it's clean, there are people smiling. you compare it with sears, which, you know, it's just -- look, lands' end might have had the best thing they had going inside the thing. >> that is the only reason why i go to sears, to shop the lands' end sales. they need to find an identity or hop in the dumpster with all the other big retail guys. >> it's become a real estate play. his loan is a real estate play at the end of the day. how he can take a pick at the end of the day. >> and one that gives him versus sears as a company the advantage. >> exactly right. tuesday is in the books, but really this week is just getting started. we've got the fed, the scottish independence vote, alibaba, a trifecta of huge events on tap. we'll discuss them next. location. location.

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afterhours. want to get some final thoughts with the panel. some huge things going on this week. mark, you think the biggest is what? >> i think that the industry's got to be looking at calpers deciding to take $4 billion out of the hedge fund investments. i'm going to be very curious to see how that liquidation proceeds and if other investors follow suit, but i do think you'll see the institutional money be replaced with retail as we see the continued democktization of hedge funds. >> the retail guy is concerning me because i've gotten more than a dozen inquiries about how much of my portfolio should i sell or all of it to go and buy alibaba, and that is not how we invest. that concerns me deeply. so the word out on the street is that everybody should dump it and buy alibaba and i say don't do it. >> oh, my goodness. >> wow. >> isn't that the canary in the

coal mine, usually? >> says too that he owns alibaba, yeah. >> i think i have the canary in the coal mine right here, and that is the newest etf announced today from ucf advisers. invests in companies that do two for one stock splits, sort of tells you what you want to know about where we are in this stock market. >> how much of my portfolio should i liquidate to go into that? that's what i want to know. >> we have to go, but how does that compare with the interest you see in the facebook ipo? >> not even close. everybody did anticipate that stock being up tremendously in the open, which of course didn't happen. >> when was the last time you saw this kind of interest in an ipo, in a specific one from your clients? >> 1990 something. >> i'm truly shocked. thank you for letting us know about that. it's going to be an interesting couple of days. friday morning it's all going to happen just a few feet away. thank you all for being here this afternoon. "fast money" coming up in just a

few seconds. melissa lee, what's on top? >> lots of investors yesterday were really worried about the fed meeting what was going to happen. we saw major selloffs. a lot of reversals in today's session. so we're going deeper into what this means and whether these are opportunities for you guys to buy out there. >> all right, over to you guys. >> thanks a lot, kelly. "fast money" starts right now. our traders are dan, brian, karen, and guy. tonight's top story, the two words that move the market. considerable time. "the wall street journal" reporting the federal reserve could keep those words tomorrow when it addresses how long it plans to keep short term rates at the current level. that report helping lift a number of stocks like twitter, amazon, and the semiconductor index, rebound from yesterday's losses. so all of a sudden, everything's all better. >> listen, if there was any doubt in anybody's mind at this point in time what is the driver of this market, it's federal reserve policy and that's it. revenues don't matter.