and see why 92% of our members plan to stay for life. this is a very special night for us. cnbc's the next 25 will air live at 6 p.m. eastern tonight, brain. . yeah, should be a great time. honored to be a part of it by the way, hopped to toss it to "closing bell." starts right now. >> and welcome to the "closing bell" on this thursday. i'm kelly evans at the new york stock exchange. quite a day. i'm bill griffeth. the markets top to trade at or near all-time highs, if in an actively map ammed mutual fund, you may not know it, as we approach the end of this year, hup managers are lagging the s & p badly at this point. and they are now chasing returns. we have seep this before, it's happening again. we have a special report on that

coming up a little bit, here. >> and first on cnbc interview after the bell, disney ceo bob iger is here moments after the company reports earnings, disney shares up 20% year-to-date as eiger announcing a litany of super hero movies due out the next several years and filming of the new "star wars'" film wrapped today. find out the force awake, if that's the title of this highly anticipated movie. get into all this and much more with him coming up. all of us have our fingers crossed about "force awake." american workers may take less vacation than nearly everybody across the globe, except me. did i just say that? but do you know what we do more than nearly the entire world? we steal from our employers. i do not do that. a new, disturbing report outlines how much more we steal from our employers than everybody else and what's getting stolen. this is a fascinating report. opened a lot of eyes when it came out this morning. >> we will take a closer look. here's where markets stand as we head into the final hour, bill

mentioned, the dow up 56 points yesterday on the back of those midterm results. other thens going on globally in markets. we saw a close of record highs. today, we could be repeating that. thesome & p up 5, the nasdaq up 9 points, talk about europe, what's going on there as well. so much to get to. >> let do that time for our "closing bell" exchange with rob morgan from b to b associates, cliff davis, heather hughes from is up america funds and our up michelle caruso-cabrera along with rick sap tele. michelle, let's start with you, do we thank mario draghi or blame him for today's market em? >> depends on your views of quantitative easing which we know extremely cop tremendous version. but mario draghi, the head of the european central bank did his monthly meeting today with the governors there and yet again, he used more words to suggest that quantitative easing could be coming, he said they were universally and unanimously, excuse me, committed to doing anything

that's going to take in order to improve the deflation/inflation picture in europe and that gave heart to a lot of investors, suggesting that they are getting closer and closer to the possibility of quantitative easing, even though we know there are deep divisions there he also addressed head on earlier reports that knocked the markets down, deep divisions that he was going to be confrontedby other governors who called him erratic and secretive, et cetera. he didn't say they were they were up true, he said, listen, there are divisions all over the world about central banking policy and the meeting that we had was one of the best ever and he really tried to give it a "go team" kind of feel. the markets believed him, at least today. cliff davis, talk about the kind of response we are seeing here, not just in the equity market, but all kinds of asset classes rallying. >> what we are seeing today, really, look at europe, look at asia, see weak performance, not seeing any asset growth. actually, seeing currency

devaluation. what's happening is investors globally are looking at u.s. being the only real risk asset so we are seeing all dollars, japanese are using less dollars to buy equities with the u.s. and u.s. investors who typically have a global allocation are keeping that u.s. focused. that's driving all u.s. assets. think we are in a u.s. asset bull market to call it. >> is it a bull market, cliff, or some point, do all of these flows start to create frosty conditions? >> well, right now, we think equities are fairly valued. we think the dollar is the risk asset of the world. so right now, it hasn't since the 1990s that the dollar was the risk asset. as a result, the rest of the assets that we are looking at with the u.s. are driving these markets. we think equities are fairly valued. overall, we are bullish. i will call it moderately bullish but think valuations are still relatively fair and really, any u.s. has topped to outperform.

heather hughes, you took a lack at the calendar today and said, holy cow, will aing where we are. >> i can't believe it. here we are, 37th record close if we close at a high again today for the year. and just a few weeks ago, october 15th, the ten-year was below 2%. the dow per day was down 500 points at one time and here we are again, at all-time highs york think it was felt by retail -- retail investor that pullback that we had october 15th. it was felt by institutional investors because it was short lived. that rapid decline we saw on the downside was marked bit same rapid rate on the upside where we are today. so, i would not be surprised if we do not see the same sort of volatility going into november that we saw in october because it was short lived and such short of correction phases as we are enduring a tighter monetary monetary policy reaching all-time highs, it wouldn't be unusual to see something like that. >> heather brings up a good

point. one that's highly debated now. volatility kind of here to stay in this postfed, if you will, regime or was that it in october and go back to seeing the vix in the single digits? >> yeah. i'm not sure if volatility is going to be screaming higher here, kelly. i do think though we are at a very seasonally powerful time for stocks and we are about to enter the third year of presidential election cycle. we just had the midterm elections. the period from november to april after midterm election, thesome & p 500 averaged up 25% and 17% for the third year presidential election cycle. so, that's what history tells us. what account fundamentals say? we have a healing economy. we have earnings going up. i agree with cliff that stocks are fairly valued i think you have seasonal and fundamental reasons stocks are valued here. >> rick sap telea lot of time these days talking about the

dollar and commodities forcing lower like oil and gold. we talk about, of course, the rally in the equity markets, things haven't about talked about lately, oddly, the treasury markets, kind of quiet here, respect they? >> not that it's quiet, that it's orderly to a fault. we all remember and heather referred to it from the equity perspective, those days that culminated with october 15th when treasuries intraday traded under 190 and since then, the market stair stepping every day with yields a little bit higher and a orderly process, which really leads credence to the notion there was capitulation on that day. today the sixth day, look like going to close a range of 231 to 235.6, although broken out of it, a one-moment high yield close, if we stay above 237 and tens, stay above 30 , which looks certain in 30s and even five years at 166. all one-month high yields, but very orderly and foreign

exchange, listen, i know it's only semantics, but the semantics are important. if you're long the dollar because your' enamored with the fundments of the dollar, my. you're lacking at things wrong. upping the euro is treacherous, upping the pound is treacherous and upping the yep is almost suicidal. i think by default, the dollar does look good. now, wait a minute, rick. >> you got to know why you're holding it. >> about to get another jobs report friday that could show 200,000 a stretch in the past 12 months of 2 1/2 million jobs added there are some bright spots in this economy. >> many bright spots, absolutely, didn't have any population growth the last eight years, we didn't have the labor force participation rate at the same level as the 70s, fed didn't have the balance sheet, didn't have interest rate subsidies, i would say it's pretty good, we need more. it isn't about whether it's good based on whatever over 200,000 in some mile stone, it's how many jobs we really need to put the middle class back in a 8-5

type position. >> understand. but rick, you would ac no, ma'am, i'm sure, the progress we have seen the last couple of years is moving us in the right direction. >> no doubt. no document the problem i have is the tail wind all good economic fundals or just more of the central banking? i'll tell you what, if you don't believe in central banking then, you know, why did china throw another $125 billion into their market? canada slipped almost under 50 in their pmi. belgium had 100,000 workers protesting against government reforms, which if they don't do, mario draghi's gonna pull out his eyebrows at some point. the world is a very cop facing mace. deutsche bank will do it for him. michelle, look down the road a little bit here toward that opec meeting and you will wonder, there are plenty of people who have about talk about we could --

>> i'm incredibly doubtful about that. i mean, oil may have reached a bottom regardless of what's gonna happen with opec. they could say that they have an agreement, but the fact of the matter is, nearly everyone involved in that agreement would have a lot of inacceptives to cheat or not to abade by them. if you consider libya has about so desperately without oil for so long, no matter what -- the government will agree they will not produce less oil. want to get up to 1.4 million, up from 800,000 now. iraq not going to agree. desperately need the money. venezuela is going to be told, sorry, folks. i don't believe it. no matter what they say that day, if they come to some supposed agreement about cop stricting supply, i think you expect to see cheating a the market is gonna know they can't keep it. >> cheating? shocking, i tell ya. shocking. >> thank you all. appreciate your thoughts today. thanks, everybody. and we are still looking at the dow about 50 points it make another run on this thursday

toward record closing, 17,500 on the dow jones industrial average and 2027. >> did you see the transports, up 105 points right now, oil has about down a little bit again today, but the transports still very, very strong right now. record territory. disney, by the way, boasting that it has sold more than 3 million in north america. bring you the entertainment giant's earnings the instant that they are released aft the bell. plus, bob iger speaks with our julia boor step on a first on cnbc interview. just finished filming the new "star wars" movie, all very nervous about that. let's see what tidbit he may be able to share on that highly anticipated release, coming up. and up next, immigration reform, tax reform, will either one get done with president obama dealing with a republican-led house and senate? former congressman barney frank and our own larry kudlow weigh in and our live poll is now open. we want to know if you think the

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welcome back. house speaker john blamer giving his first news conference since the big republican whip in the midterms. >> yesterday, a little bit of a era of bipartisan good feelings here in washington. we heard from mitch mckoppel, presumptive new senate majority leader said just because we have divided government doesn't mean we all can't get along and get something done. we heard from president barack obama who said, you know, if republicans come up with a good idea if is a good idea, i will sign it into law, that sort of ended today. speaker of the house john boehner not extending that olive branch to the white house that we heard yesterday from mitch mckoppel. in his press conference today, the speaker of the house suggested that the president simply hasn't about forthcoming enough with republicans. take a list top what he had to say just a little while ago. >> it will be even harder if the president suspect willing to work with us. questioned why, we heard him say he may double down on his go it

alone approach. listen, i have told the president before, he needs to put politics aside and rebuild trust. >> between the lines yesterday, if you actually listened to what the president said very carefully, you heard him mention things like two-thirds of the american people didn't vote yesterday -- or earlier in the week on election day rather, that is suggesting that the president believes there is really not a map date here for republicans, since it was such a small electorate. the president said yesterday, you know, i'm the guy who was elected by everybody, the entire country, he feels like he has to get something done here. by implications that diminishes the members of congress elected by states and congressional districts. if you read between the lines and even the most bipartisan comments here, kelly, what you're hearing is a recipe for a lot more gridlock going into next year. >> all right, thanks. we will see you later. we want to know, will the president and the republicans finally be able to work together, put a end to the gridlock, just hearing how

difficult that may be already. but we want to know what you think. we are asking to you cast your vote right now on our website, cnbc.com/vote and see the results as they are being tabulated now. >> weighing it on the issue for us, cnbc senior contributor, larry kudlow and cnbc contributor, barney frank. some bump him up to senior. listen, congressman frank, you were there when president reagan genuinely worked with the democratic congress the last two years when president clinton worked with the republican congress had his last two years. >> you left out the best example, i think, of cooperation and that's when i and chris tod dodd, nancy pelosi and i worked with president bush before election. president bush got much more cooperation from the democrats at that time that the republicans and that left me very disappointed because the immediate aftermath of great bipartisanship on the part of

the democrats, treasury secretary paul accept wrote a book in which he described that, president obama took office and mitch mcconnell announced at that point that his main goal was to defeat the president and the cooperation fell apart. i tried very hard to get some bipartisanship in the financial reform bill and the republican leadership on that committee basically was told they couldn't to it. so, i hope we will get something, but the fact is that after the election of 2008, the republican posture was one of total non-cooperation. i hope things will change in the future. >> yeah, lack, all right, barney gives you his side of the story, i get that. the point is in the senate, for example, house bills never were processed in the senate because mr. reid wouldn't take any votes that hurt the democrats in this election. here's a point. yesterday, president obama, in my. needlessly, needlessly, blew this thing up by saying he would use executive action on immigration. he didn't have to use that kind

of inflammatory lapping wham. the republicans want immigration reform. the republicans want some key stone energy bill. the republicans want corporate tax reform. the republicans want obama care reform much the point is, why does the president have to be so inflammatory in the first news conference? why don't they wait, sit down, see what these bills lack lake? and i just iffet that obama was being very arrogant yesterday. >> what do you think, mr. frank? >> let me respond. first of all, you know, there are two republican parties, this's the real republican party and there's the republican party that exists in larry kudlow's head. i prefer that party. larry, some people have imaginary friends. larry has an imaginary republican party, moderate on lgbt issues, for immigration reform, the fact is that it was in the last congress before owe bam in said anything about unilateralism where the senate passed a bipartisan bill on immigration and it was the house that refused to allow the subject to come up all all, not because john boehner wouldn't like to do it, but because the

right wing in the republican party is so dominant in the house. so i disagree that anything the president said yesterday was a problem. and minute migz, demeaning republican it is you say the president hurt their feelings, therefore, that is going to affect -- >> this was friday after -- i don't want to get hung up on it, but this was waving a red flag in front of a bull, the point i want to make. the election is over. the republicans one a landslide. the theme of the republican party is gop nah be economic growth and conservative reforms. and boehner has said and mckoppel has said, sometimes we will agree with the president and get a bill and sometimes he will veto a bill, in which case, you got issues for 2016. it's there for the taking. the question is will the president heed the election returns? i don't know the answer to that. >> larry, let me respond. first of all this notion that

whoever loses the election should do what the other party wants shall that wasn't the republican response to obama whipping in 2009. it wasn't even the republican response to obama's getting re-elected in 2012. we have a system in america where we have stacked returns and people who are elected in one era are entitled to keep pursuing their views. now, again, i didn't hear thatting orment that, oh, obama one, we have to basically follow. the second is this you greatly emage rate the ability of john bayer to deliver. i think the most interesting disagreements we are going to see the next few months are within the republican party, between the very milk and tea party wing and mainstream conservative wing. i think better for the country if that wing prevails, but the evidence in the past is that they don't. >> you're gop nah hear this, barney, look. i'm a -- big-time republican. the housement is changed because they got a lot of new members. so, i'm optimistic that things like immigration reform can be

worked out. i may be wrong. but the point is, i'm just saying, here are the themes you're gop nah get. economic growth, first. you're gonna get limited government. you look at the exit polls. people by 74%, government failed to deliver. obamacare has got to be reformed. the map dates have got to be reformed much the 40-hour work weak has got to be reformed. the question is will the president silt down and -- >> what about the 40-hour workweek? >> obama has never worked with congress, barney, you know that. >> and we do have to go, but larry, what were you saying about the 40-hour workweek? >> the republicans want to amend obamacare. they want to say a 40-hour workweek rather that -- >> i thought you want to go -- [ overlapping speakers ] >> we got this poll asking view

officers think the president and republicans work together, just closed it, 80% do not believe that can happen, off to a good start here, respect we, guys? >> can i give you my response? polls taken of people who are watching a particular tv show, maybe interesting, guys, you know they don't really have any validity. >> not scientific. we know that. >> i want to reach some occasional -- >> up scientific, you're playing the republican party game. let me at this point thish this. barn think, this is for you, i love our debits, all i'm doing is trying to reach some common ground, that's all. maybe we can reach common ground, maybe we can't. i get that maybe obama can reach common ground with the republicans. maybe he can't. i get that. let's wait and see. let's be optimistic. >> i agree. >> we need you both back on capitol hill, make that happen. see you both. thank you. as always. >> thank you, barney. >> thank you, guys. >> larry, good luck. i sense a new show is

coming, don't you? it almost happened just now, as a matter of fact. 35 minutes left in the trading session here as we await tomorrow's jobs report. >> yes, we do >> the market does seem to be kind of in holding pattern now as we head toward that, dow is up 50 points, for the dow, the s & p, transports, utilities, any positive close is another record high today. we have got about 35 minutes to go. crude oil sliding again after opec announcing prices for global demand. we will have a report on opec's new estimates and buzz it's serving, live live with jackie dea gel less from the my next, when he come back. we believe every life deserves world-class care. as one of the top four hospitals in the nation, over 100,000 people from around the world come to cleveland clinic for care each year. and we're ready for you with a second opinion or a same-day appointment today today today and everyday. call today, for an appointment today.

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opec -- i should say crude oil sliding, opec cut its price forecast. jackie d is at the nymex with the latest on that hi. >> we saw a 70 cent slide in west texas intermediate, closing at 77.91. brent crude under $83 a barrel. the headline in the pits today that opec cut its price forecast after the long-term. it was 110 a barrel. now saying they are looking at about $100 a barrel for brent crude. also cutting its short-term production forecast, 1.8 million barrels a day, a short-term cut. remember, they are contemplating it. this is just a report, not a actual production cut. so of course, all eyes are going to be on that opec meeting november 27th to see what they actually do. opec type tuning here, i don't want to be alarmist in terms of

what this report meant to the markets today. they are sort of looking at it they are taking it in and also saying watch saudi arabia, what saudi did with the price cuts earlier this week shows that the country is looking at the cartels as a little disjointed now and making unilateral decisions. if it continues to do that, opec may sort of become irrelevant at this point, guys much back to you. >> yeah, that's certainly the fear, the perception at least they are trying to combat, jackie. thank you.talk more about where oil is headed now. >> joins us is james corps yeah, founder of option sellers.com, the author of the complete guide to tos selling, also with us, chad brown steep, ceo of rocky mountain resources. um, james, you think opec is playing chicken in this particular case. what do you mean? >> well, we certainly do in the past, opec would be backing up the price of oil every time it falls by trying to take supplies off the market. this time around, they are helping to actually see oil

fall. they think they like it in the 70s currently to try to discourage some of the great retyping capacity that's going on now in the united states. they are seeing an independent u.s. in the future and that certainly scares them, their market share is certainly of utmost importance to them and basically, the fact that they can play chicken, producing oil for $15 a barrel with the new refiners here in the united states are producing it for 80, they can play a game with them right now to get them to cut back some of their production ideas and later on, prices can rally next year. chad, why do you say that 77 is the new $100 for the oil price? >> we are in a place now where the world is understanding the power of the u.s. economy, the power of the u.s. loyal economy, the power of the u.s. gas economy. we have a position now where we are going to be producing as much as we can as long as the administration allow us, the key stone pipe line and other infrastructure to happen in the

united states. the u.s. will put 77 to 80 in its place consistently as long as we have a long-term program. right now the u.s. has got 1900 in the field, we need 3,000. >> if what you're saying then is because of the new supply/demand dynamics, 77 is the global equilibrium price, does that mean for producers who got into oil at 100? >> you are dog see a lot of the credit players who don't have the operating expertise get hurt by the last 60 days. we have a new reality of 77. rate their leff ram every six months, you are going to see some interesting supply from a m & a standpoint on the markets, a lot of the larger players ma very to divest and put players in the smaller realm who are not linked to the long-term 100 oil in a good position. but long-term, 77 to $80 oil is

the right thing for the u.s. >> james, you seem to suggest, maybe i read you young, i don't think i did, seem to suggest that opec still has some juice out there, that they can help control the price of crude oil down the road, but if we top to pump and produce as much oil, especially down the future, if key stone becomes a reality, i mean, the price is going to go much lower, isn't it? won't they become a little more irrelevant? >> >> bill, i think opec is trying to fix prices and what i mean by that, they need to temper back some of the exploration going on in the united states now. we can whip this game, push prices down temporarily, get some of these ideas of aspiration of the united states to back off a little bit p generally -- >> all those guys are going up and exploring and producing all this oil and thinking let the other guy cut back on his production. i want to be part of this boom that's going on right now. we always overdo it when there's a new item on the economic front, right? >> i agree with you.

we think that oil prices at these levels are gonna top to make a resur gems in the global economy. we see demand coming back strongly the first quarter of next year and we think these prices are temporary. opec right now is showing that they still have the muscle to dictate the price. they are not going to be trying to push the market down next spring. we see them letting up on the sun place and we probably see 85 to 90 dollar oil barrel next june or july. >> all right. thank you both this hour. half an hour to go here and looking at markets sitting at all-time highs. dow up 62 points, 17546. some & p up about 6. we come back, with the end of the year fast approaching some active mutual fund managers are in full freakout mode we are told because they are getting trouped by the indices that they follow, the standard and poor's 500, for example. the pros will be weighing in on how the next move should play catchup could affect the markets and your money. also, another huge wave

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welcome back. fund managers are freaking out a bit. the technical term, by the way. dominic chu joins us with a special report on his developing story that should be of keep interest to all investors, right, dom? >> if you are a actively man ammed fund and picking stocks, trying to outperform the market and behind the markets right now, you're trying to find a way the next couple of weeks shall next couple of months rather to get that performance back so you can match the overall market. puts this debate in perspective about active versus passive, whether or not you can outperform the market or whether or not to invest in the market and be subject to the ups and downs of the overall markets. so, passive beat active in 2014. according to morning star, the average mutual funds in term of the overall active ones versus passive ones, year-to-date performance, the end of last month, passive mutual funds

gaped 5%, 5.3%, that beat the average actively man ammed mutual fund, gaped about 4 1/2%, so, passive index funds outperforming. look at two of the biggest players in the business, at least on the passive side of things, biggest index funded america is the vap guard total stock market index, ticker vtsmx. $370 billion in assets, a ba he moth and up 10% year to date, very respectable and just about beats the market, by a hair. top holdings, apple, ex-son and microsoft, no surprise, three of the biggest companies in america. now, take a look at the actively man ammed ones, biggest one in america according to morning star is the american funds growth fund of america, agthx, ticker there $142 billion assets under map namment, up 8%, not as good as passive, respectable, top holdings are amazon, gilead and google a little late todd with which they want to put in their portfolio. about the tomorrow line, the

debate rhames on, all kind of stats out, seems passive funds in 2014 are beating active ones, guys. >> certainly does, dom. thank you. with us, jim lowell of investment and michael guy yad from the inflation rotation fund. welcome to you both. jim, you do active funds, passive funds? >> we invest heavily in active, managers have been doing so 20 year, 3.2 billion under map nam.. what we believe in is that you buy the manager, not the fund, the fund performance, track records and average numbers of performance track records really don't tell the tale of the stellar managers at the top of the bottom. we know this is a difficult year for active managers to outperform the s & p 500, the vast ma'am jurority of managers we invest in, that is not their actual market benchmark. so, it is not hard still to find good managers who have a long-term track record of outperforminger, not just benchmarks, but does take a little bit of doing. >> i mean, i have always thought, michael, that, let's

see, let me make sure i get this right, i got active versus passive that passive will outperform active in a up market, in a down market, want to be in an actively mappabled fund, the passive is going down no matter what. >> everybody loves passive and buying at the top, right? i know simple to ma'am risk man namment involved in portfolio management, the s & p is a new money market. to the point about why so hard to beat the s & p this year, the only way to really beat the market or to bet the average is to choose the right average, right? at the end of the day. most asset classes really performed relatively poorly against the s & p, except long-duration treasuries. small caps, emerging markets, a top of deals, haven't had a chance to actively allocate to that smaller scale, you can get the active outperformance. >> play catch up then, that is what we are hearing? here is a interesting thing, we talk about this best six month

period, november to april tend to be the best sick months of the stock market. but we are also saying at the end of every evening, a month later, the stock market corrects. so, you have this battle here. i think you go with the one that ends up playing out from a perspective, i don't think anybody is expecting you have further declines here. >> jim, i'm going to take issue with a couple of things you said, i hear them frequently. one is people say, look, done a get a job of picking the right managers, et cetera, therefore, no problems, i say that's great for adviser investments but great for the average person who -- how could they really ever possibly pick the outperformers all the time and the second one, people always seem to bash the s & p 500 saying it is not the best index and not reflective, but who cares? the point is the s & p 500 proving itself time and again, frankly a great index? >> it is a great index. it is clearly the wallet index. we all measure the performance our portfolios, even if they are

balanced portfolios, with stock and bond funds and eps against the s & p 500 but really a false benchmark for a well diversified, well allocated portfolio, in terms of individual investorses being able to pursue superior talent in the active manager ranks, certainly turn into cnbc, you have a bunch of superior active managers here almost every day, but it's just not that difficult. if i look at fidelity's universal lope, there are more than three dozen active managers currently on the equity side of their product lineup that are beating their benchmarks. >> but they are not going to be the same ones. >> time period. >> but -- >> it often is. it oftensome the managers' track record is something that really does reveal superior skill in terms of, or the lack of it, in terms of stock selection. so, i don't see any managers, certainly up in that we invest in, chasing year-end returns to try to bolster their near-term performance. what we do see is some real on tuneities and managers who most

people are not gonna want to look at, especially those inside of the international realm. >> michael, i can hear jack vogel from pennsylvania right now. if i'm in an intext fund, paying less anyway, the fees much cheaper that. for a actively man ammed fund. most actively map am ready not actively map ammed. hate to break it to people in the business. most only marginally overweight or underweight their sectors their sectors and average market cap. >> why don't i just go with a index fund then, cheaper? >> what a lot of people have done. problem with that, investing is like a pendulum, one extreme to another. everyone belting on passive indexing for gets that's set works bet per when going the other side. >> listen, we need to keep talking about this, thank you both for being here. michael gayed, jim lowell, we top to mull whether catching up with the s & p 500 will push markets, generally speaking, higher that the average.

>> a neck totally what wither haring, pushing the dow up, up 67 points. again, any positive close for the duh on thesome & p will be a new all-time high once again a tough day for orbits, the travel website posting disappointing profits, we will talk earnings and the economy and where the stock guess from here with the ceo of orbills next. >> after this

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welcome back. holiday travel season quickly approaching and that is welcomed news to travel sites like orbits. >> the company did report earnings this morning, coming in low we estimates, the stock taking it on the chip today, down more that 8%. here to break down the numbers for us, in a cnbc exclusive, we welcome orbits ceo bernie harper. good to so you. welcome back. thank you. what happened in the quarter? obviously, the stocks, the market's not pleased with what you got, but are you what did you get this last quarter? we delivered a strong quarter. we delivered 19% growth. 15% revenue growth. 14% growth. so arrange strong quarter. we also announced a new deal

with bank of america, through which we expect to be powering the loyalty travel offerings starting in 2015. announced a strong quarter.we delivered guidance for the full year and delivered guidance for 2015 for growth in the mid to high single digits. it was a strong quarter and delivered good guidance, a business generating over $100 million of free cash flow a year, great in terms of key initiatives. i can't explain the reaction today. we are he a pleased with the quarter. >> it is a competitive space. it is one in which you have big players like google now entering, getting more, aggressive, people are using

google nates, even they don't advertise it. where does that leaf you what about airbnb? looks like the marketing cost is going up a bit and have loyalty programs coming out, where is orbits really going to be in five years' time? >> you know, our vision is to create our sites to be the most rewarding place to plan travel in the world. and the way we are doing that is through these loyalty programs so travelers, particular lynn at hotel side, significant amount of margin available, so, we are giving our customers the ability to he were up to 5% back when booking a hotel, 2% back when booking a play and they can use that rewards subsequent when booking a hotel. >> that affect your profitability, what a lists seem to be saying now, your marketing costs and the cost of doing business to get a loyalty program off the ground, as you were trying to do in this quarter, is going to take out of your profitability here? >> you know, we have been operating our loyalty program now for over 12 months, we have got a good visibility in the financial impact of it actually, see it as being accretive,

because while there's a cost value delivered to consumer, he wering that back and more in the farm of incremental hotel transactions customers are seeing. seeing a very substantial increase in the hotel-to-air attach rate and a 10% increase in the number of hotel transactions, active hotel customer across our websites. so, really working well. >> last question, barney, but as mentioned, i know ceo, the stock market one day is just one day. but over time, it does make you days potentially vulnerable as a takeover target. what do you this hi about the prospects here of remaining, how important is it for you to remain a stand-alone, independent company? >> we think that orbits as a company has got great prospects. we think that the growth rates that we are seeing in our key strategic hotel business the way that we are delivering on our loyalty, the way that mobile is growing, a key data point we announce today the first time ever, we are generating over one

third of our hotel bookings across all of our global sites through mobile deadvices. and after that the growth initiative got bnb, private travel. we feel great about the other company's stand alone prospects. >> thank you. good to see you again. >> thanks a lot. ten minutes to go here. markets moving on up. >> did you see cash.just walked by, signaled that got $500 million to bayh on the close here. that's the buy. the upside. we are seeing it now, as a matter of fact. >> there is the dow up 75 now. if it tops to trade at pretty much all-time highs. >> we will have jobs numbers that are gonna affect the market tomorrow. so will disney's earnings. due out after the close tonight and ceo bob eyeing letter be here in a first on cnbc interall have a, plenty to talk about, including the new "star wars" film, which just finished shooting, now has a name. it's called "the force awake." we will be right back.

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welcome back. keith and i are just talking here about the market and shaving. november beard already, huh? off to a great start here. >> thanks.

i actually started in october. i cheated a little. >> did you? running start? >> absolutely. >> that's not allowed. market here, you had been waiting, i haven't talked to you in a little while, you had been waiting for that proverbial correction. did you get it, back into this market? >> we did. in the market, the s & p down 1815, down 10% from the all-time high, at that point, 9.8%, we called market oversold at 1884, so a little early. if you kept buying on the way down that trade worked out very well. >> now what? >> well, i think we stay in this trade long. even though we are at all-time highs, another day, another all-time high. how many times have you and i said this over the year, still stay with it. may not want it as your positions here but certainly not shorting this market, you will get hurt. >> for a time, oil and stocks were correlated. they would go the same direction. now, they seem to be die verging here, will oil down the road be good for stocks? >> i think with the market trying to figure out now is the impact, positive impact,

consumer stock going to be better that negative impact to energy stocks. what's really interesting, once you see the energy stocks start to get oversold, see them pop back, regardless of the price of oil, natural gas all-time highs dork having in in the energy complex, the another through the energy complex today is coal companies are making a come back based upon the election. >> are you in energy here, quickly? >> i would be, yes, because so oversold, i would play it very carefully right now, because the room for mistake is a there, apparent for you, you could get hurt, tight stops behind the long positions. >> always good to see you. thank you. >> thank you, bill. >> enjoy the rest of the month. no shaving. i wish could i do that. come back with a closing count down for this thursday. after the bell, you know about the earnings, they were gonna hog the spotlight once again, results right when they hit the tape, disney especially coming here, and possible will join us. watching cnbc first in business worldwide.

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if you have any sudden decrease or loss in hearing or vision, or any symptoms of an allergic reaction, stop taking cialis and get medical help right away. ask your doctor about cialis for daily use and a free 30-tablet trial. coming up on the last 90 seconds of trading here, one thing to watch for, job numbers tomorrow. talk to bob about that in a moment, earnings coming out. among the companies reporting tonight, disney, king digital, tech myra pharmaceutical, zing ga and bob iger will be joining us live to give us a run down on

the situation on disney's numbers. what do you think on jobless? numbers? [ overlapping speakers ] . >> we moved up on 8:30. i think optimism they might be the consensus numbers now theed about thing about the market, new highs on everything. the bad thing, new highs. things aren't cheap now. i have about looking at -- >> never be happy about that, can we? >> consumer stocks, the whole foods and cvss of the world, double-digit gapes, the bank stocks terrific run the last four or five week, getting expensive. a lot of stuff that's sort of on the enstep sive overbought side of things. on the other hand, gold, finally bouncing, ridiculously oversold, talking about gold stocks finally bouncing a little bit. nice to see that finally happening. i don't see any bounce in ibm.

the sixth map of the dow jones industrial average, after terrible earnings report, nobody interested in that at all. >> transports top to boom. new high. [ "closing bell" rings ] >> record closing highs now for the dow and s & p once again and those transports. stay tuned for disney earnings and interview with bob eyeinger on the second hour of the "closing bell", coming up. thank you, bill. welcome to the "closing bell", everybody, i'm kelly evans. you know what that graphic means, at this point nishing another all-time high hear on wall street, the dow jones industrial average about 66 points, closing above 17,500. s & p closing at 2030, nasdaq a pretty strong day. look at that, exact same size of gapes across the three indecks, up 17 point 4638. we await big earns after the

bell, ceo bob iger straight ahead. mike san taupely from yahoo! if and sarah eyes.and cnbc contributor, john naming you're yap and fast money trader, guy adami. welcome, one and all. mike sap tolly is this a midterm affect, two days in a row of all-time highs? >> i think the midterm effect in the sense that everyone seems to be a al map knack trader right now, so steeped? the seasonal ten depp sis and historical patterns, nobody seems to want to get in the way of it not just midterm elections, best six months of the year. some point, stay up here, sleepwalking higher, gonna quib well it say small caps capped up, a lot of things you would lake to see to show further strength, maybe not here in the short term, but a difficult market, look, the transports up 30% in three and a half weeks. wow. >> crazy, the air lines r. >> airlines. >> but still. >> sarah, how much of this is because of mario draghi? >> got to give draghi a little bit of credit, clearly, his words soothe the markets, saw that in europe. stocks there rose, u.s. stocks

also rose, sought most in the euro though, where we saw 124, weaker your rose, drag hi and ecb would like to see. haven't seep those kind of levels since back in 2012. he has raised expectation and hopes that that's where the next qe stimulus monetary easing is going to come from. we see how powerful those effects are overseas, with japan last week, now on europe, the federal reserve is out of the qe game, what's interesting, others are swooping in, the money rushing easy. >> why guy adami, throw in the towel and chase this into your end or what? >> i think you misunderstand me sometimes. i'm realistic in terms of how this will all play out because when you burp the currency, global race to zero currency wise -- [ overlapping speakers ] >> are you talking about the u.s. dollar? >> the only were the u.s. dollar is higher is because everybody else is behind the eight ball, we are just ahead of the curve. the rise in the u.s. dollar is not because we are some pap nah see ya in terms of economic

activities, because everybody else seems to be saying, hey, look what the u.s. did, maybe seems to be working for them, why don't we do it ourselves, happening in europe and in japan in spades. they have lost total control of their markets, for better or for worse, genie out of the bottle there h doesn't mean the markets rally, they will top to do so. how does this all end well? >> staying is all nominal, not -- nominal. >> of course all nominal. that is a long term concern. for now, those policies aimed at whatever you call them, burping their currencies or weakening, devaluing their currencies are boosting stock prices over the globe. so perhaps it doesn't end well. that's long -- >> i get it. listen, absolutely, i've understood all along what the game is about. it's absolutely makes sense that equities rise, but if you just take a step back and say how lousy must things be in japan, adhere to a certain extent and europe for them to have to take

the measureser the up precedented measures that they are taking? >> what about, dr. j, is this why you kind of cover your ears when it comes to the macro stuff and just look at those names that might have -- in other words, forget the long-term and folk coup the day in, day out? >> yeah, either a trader or you're a investor, you have to define what that is, what makes the most sense for where you are in your earning lifespan and all the rest of that but i think there's tremendous potential there. guy and i have about in the camp, lower for longer. that obviously is going to play out here. and i think that you're going to get the bank kicking and screaming, they are going to be dragged in here with drag hi, probably in very early january, if not then by the end of jap, they will be in there and then i think you're going to see a pretty significant push even further, strong dollar trades, which are retail in particular, because everything we've -- we sell here is made somewhere else, that's really good u.s.

retailers. >> give us examples. t.j. maxx, tjx or t.j. maxx and marshalls, but that's not my number one pick, just the number one retail they're i would chase. but kohl's, ross stores, all these guys that are good operators, i think macy's to a smaller extent because once you're at their size, then you're doing a lot of currency hemming, mike, i bet could you talk to that. >> and by the way, did you think, stop me if i'm totally veering off topic now continental today basically saying talk about currency hemming, forget oil hemming, doubling down effectively saying oil prices this is the about the tomorrow, we are going higher from here. how risky is that for him to take that position? >> risky because he could be wrong about the call but also because i think investors kind of want to play these things without worrying about not just a good air line, running the business right, hemming correctly. i do think it's kind of tough to sell your stock on wall street

at a good play for the actual business, where you get into that situation of saying, here's where the commodity price is going, where our costsome >> watching the price of oil and did something today that was notable, at least for the bulls who say this price has bottomed, did fall but did make a new lower low and the dollar did make a new higher high. a lot of people are looking a that the relationship saying maybe here. much as we top to follow earnings, we have got numbers from zipping ga now hitting the quarterly results out, morgan has the numbers. >> beginning ga reporting a one penny loss per share in line with cop accept suss estimates on bookings or revenue of $175 million, a bit better that the $172 million that the street had about expecting. but user numbers coming in a bit light. daily active users of 26 million versus 29.5 million estimate, and also, a declimb over last year. monthly average and monthly unique users also less that expected. however, average bookings per dau, higher that estimates and

interestingly, the company's transition this year to mobile seems to be taking root. mobile bookings increased 111% over last year. lastly, guidance, both full year outlooks in line with estimates and that stock is moving higher as we speak up, 6% in the after hours. kelly, back to you. >> not aed about move though, morgan, thank you. dr. j, guy, launch here? -good enough quarter to make stock go higher, doc can speak to this, 2.50 stock can effectively become a option without any time who are raisin. i think it's interesting, i don't think the quarter was a disaster. good enough, continue to see it go higher from here. >> i don't have a position right now in zipping ga, i agree with guy a perpetual option, as long as the company says it around at $2.50. arm a lot of talk it got below a certain level, talking about what the building in san francisco was worth. so it really is down to nobody is taking the business as much built into it. >> buildings in san francisco, by the way, that's in itself.

might be worth a heck of a lot. who wants to talk about commercial real estate, too soon, wait for the valuations to get eye popping in major areas to get talking about it? >> i think we have to wait for something to break out there. i mean, nothing right now the cost of iffing, none of that stuff is pushing the limits. yeah, are people buying, building the prices that are going to be bad bets down the road? probably. but to me in the short term, that doesn't map fest itself yet. other stuff starts to up spool. >> we have a couple now, finally, coming to fruition, we have seep in cities like new york and now spreading, but lack what's happened this week, we have the new -- the freedom tower opening, starting to take "copdy thanks" in, structure going up on 57th street, i wish people could all see just how big of a structure this is, it's jaw-dropping to think about the valuations that these things are commanding and these are just first wave to come on to the market. >> then look at the foreign investors, which individuals up until now and now, it's china coming in and buying up the waldorf and so forth.

>> right. right. >> nearly $2 billion price tag as well. >> right. right. >> so to your point, that's endorse.but also a worrisome sign because we have seep that before with, like, pebble beach. >> wonder some of the foreign economies, whether that vor case, appetite is going to be going up. >> exactly. after having evaluations. get ready for disney earnings. guy adami, what's with the suspenders? >> you know, kell, i started on wall street in 1986, now the cnbc 25 gala i think at lincoln center, i think, you know what, back in the day i was young and had my hair darker, i used to wear suspender, i brought them out again. are they satin? i think they might be sat.there? >> well, back in the day. this is what worked. >> thank you for being here, guy. let you get ready for show. look forward to that eventilator as well. guy's coming up on fast money with the rest of the crew at 5. going to be joinedby tv legend ream jesse fill bip today. find out what ream jesse' latest

trade is and why he is so excited about it all coming up. sometime to come here, guardians of the galaxy ruling box office this summer. all right blockbuster film deliver pock buster earnsings for disinnic? ceo bob iger will be here to break down the results even before he speaks to a lists and that's after this break. also ahead -- >> i would enjoy having some keep keep bourbon with mitch mckoppel. >> the chairman -- the chairman ofmaker's mark saying he would be more than happy to host that burr bop summit and he will join us here on the "closing bell." watching cnbc first in business worldwide. man cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities. cme group: how the world advances.

welcome back. we are just homes away from getting disney earnings. for more on how the they are expected to do this quarter, bring in robert luna along with our papal. robert, it's goed to see you again. i understand this is one of your most bullish positions. it is, it is our firm's largest position, full disclosure, my up personally largest position and i think a lot of things to be excited about right now with disney, kelly. it's one of those stocks right now, somebody asked me a couple years ago, robert what is your favorite internet stock and i said disney and i think people kind of scratched their head.

the were is we are fineding out that content truly is king now and we saw that deal recently with google play and i tunes kind of coming together, shaking hands to be able to share cop tent for disney anywhere across platforms. you know, there's no one really that i can find that can create original content and get into the consumers a mind, heart and wallets a mop advertise that like disney through their five different give visions. they have had a good run. anybody here take issue with that this visa? >> i don't take issue with the visas. i think disney has proven that it basically can pump top-quality cop tent through all the arms of its empire and do great. the thing that worries me is that nobody argues with that point. i do think it is a consensus favorite, trading a all-time high, everybody expects them to beat earnings, as they almost always do. i don't think the long-term story is a problem. cable ratings really have fallen off a cliff. disney more than most. >> suspect abc one of the best

performers, ratings wise, of late? >> although abc not necessarily a human contributor, talking espn, disney chapel, have to worry about their money made, but long-term concerns, the fate of the cable bundle is the fate of that business. >> why, robert, you refer to them as internet companies, see their ability to move on to more -- up tether themselves from cable? is that part of it? making the move to get the trend? >> he is right. if there's one division right now, unfortunately happens to be the largest, media networks, we saw 7% decline last quarter out of espn. so, hopefully, we will see a bus back there, but abc family kind of offset that. but you know what's interesting is that the networks -- i'm sorry, the film division used to make up about, you know, 23 to 24% revenue. >> hold that thought. i think we do now have the rules. walt disney earningings with our julia boorstin looking through the numbers, a very special guest. julia? that's right. looks like those numbers just crossed the wires and it looks

like earnings coming in at -- excuse me, earnings coming in at 89 cents a share. that's right in line with projections. we have revenue of 12.39 billion. that's hair better that were the 12.37 billion expected much looks like a record year, disney's fiscal fourth quarter and driven bay record park attendance and studio profits more that doubling. joining me now with more on those results is disney chairman, bob iger. bob, tell us what really drove the rules this quarter. >> well, the results were driven pretty much by across-the-board success, parks and resorts were up nicely in the quarter, a great quarter from our studio. ended up being up 16% on epsome basis on the quarter cries the company, great intel lech wall properties, strong tourism, travel and just a really type performance which capped off great year. we were up 27% in eps. and that's really quite

something given the size of our company and the nature of our businesses. >> let's talk a little bit about the studio, operating income really surpassing expectations, looks like operating incomes up over 100% the past year. you big slate of marvel movies, you have warper brothers trying to compete with their justice league. who you are you guarding against oversaturation with super heros in particular? >> we are not concerned about oversaturation because in marvel, we have a great brand. just consider what they did with guardians of the galaxy, for instance, and the fact that there was demand to see that film even though it was characters and a franchise was relatively up nope. they went to see a marvel film and we have great filmmakers. when you come bip the two, quality movies, strong brand, obviously, less to worry about. there could be many more super hero movies in the marketplace. but not all of them are marvel films. >> now i want to ask you about earning, first i have to ask but this star with as news, our newsroom here is abuzz.

you announced you were out shooting is and you have a title for your new "star wars" movie "the force awakens". what are you going to do to ramp up this release? are you gonna release the old "star wars"? >> sounds like a good idea, sounds like a great idea actually, julia there are a number of plans we have between now and december of 2015 when the film comes out. the good news there is strong interest not only in the new film but in the films that have been released before and going to be really smart about it. and make sure that, you know, more that anything else, that we ready people for what we think is going to be just a tremendous movie event in 2015. very excited about it just wrapped principal production and the footage that i have seen makes me really excited. i wish we were premiering the film just a couple of days instead of the end of next year, but it's gonna take a little time to finish it so i'm going to have to be patient. >> does that mean we will be able to sea all these movies in

theaters? can you announce that here? >> nope, can't announce anything further. announcement title this morning, that is about as far as we are going to go >> moving over to the park, looks like record attendance here in the u.s., what drove this upside in the park division? >> well, we had very, very strong domestic performance at disney land and disney world. we had a good year in hopping congress disney land and tokyo disney land. and we have got great product in the marketplace, new hotels and attraction, fantasy land in walt disney world. my magic plus is starting to make a difference. our guests are engaming substantially more before they come, about 75% of them are making use of my magic plus to reserve time on attractions, which is a big deal in terms of improving guest satisfaction and we just have a product that continues to be in demand but also proud to say we continue to put new ip in and top to innovate and have great

creativity, just saw yesterday some footage of a frozen castle show that's going into orlando for this holiday season. so they just keep continuing to offer people what they want and really what's driving the numbers and great customer service. nothing better -- >> sorry, go ahead. >> go ahead, sorry. >> the parks offering a unique window into consumer confidence and the economy. what are you seeing in the fourth quarter, this quarter for the holiday season, advanced booking? >> our booking trends are good. they are up in the quarter about 10%, pricing is up slightly. so, that's very good sign. we feel good about the quarter and good about the year for parks and resorts. >> we just heard. very good. and our cruise ship business is also doing quite well. >> now, we just heard a top from your rival media company about direct-to-consumer streaming options just yesterday, less moons very talked about poe ten informationer showtime, direct-to-consumer option, also their news service that's going

to be basically a service for cord cutters. i know you are doing experimentation with espn. but what are your mr.s, in terms of surveying the growing number of people who don't pay for cable? >> well, we're in the dreck-to-consumer business in many ways. espn, as you mentioned, is a great example of that. but i think it's important to take stock, in a way, and consider the so-called multichapel bundle. right now, 101 million homes in the united states have multichannel bundle. that's an incredible number. it's down ever so slightly from a year ago.when you think about that you have to conclu that th bundle, while it is has eroded very slightly, still the dominant package that the consumer is buying to get television into their home or to be entertained in their home and we don't see that changing that much in the foreseeable future. primarily, bus it's still offering a lot of variety and a

lot of quality for a price that is generally speaking, considered reasonable, given again the product that they are being offered. is there more competition? absolutely. we see it in terms of its impact on mill help y'alls who seem like they are signing up for the bundle a little bit later that before. and the economy has always had some impact on it, although we don't see that as much lately. what we do know though is that we are incred play well positioned as a company, probably better positioned that nip, given the strength of our brands and the quality of our programming, but if this changes radically, if things change, no one's going to be better positioned that we are to reach the consumer directly. what we are trying to do is to improve the value of the bundle and what we have done under the mobile, by making our products and services available to subvibers of the bundle is one way to do that. will there be experimentation? yes. might web part of that experimentation? i think that's possible. we are taking a caution approaches here because we think

that the prudent thing to do is to do what we can to main tape the value of what is obviously a value creator for this company and for a lot of other companies in the media space. just one quick final question on "frozen", 3 million frozen dresses in less that a year, what is your forecast for froze.this whole day season? >> the forecast for "frozen withes requests this holiday season is very, very hot. we saw this with halloween last week. i was in new york at a halloween parade and couldn't believe the number of elsa dress that i saw. kind of heart.ing much bay the way, a lot of marvel costumes as well. so, i felt good all around. but we think the holiday season is going to be very strong. we have got a great, great lineup of merchandise on the shelves at the disney stores, not just in the united states but in europe and in asia and we know that mass retailers also well stocked in the holiday season, they really believe in this franchise, as do we. >> bob, thanks for joining us, bob iger, disney ceo, back to you. >> our thanks to bob iger and to

you, julia, very much appreciated. going to pivot now with breaking news on another big consumer name. that's nike and our kate rogers. what's going on, kate? >> nike coming out, announcing that they are dropping nfl player, adrian peterson, as a spokesperson, saying "he is no longer a nike athlete." now, peterson did reach a plea deal yesterday with prosecution in his child abuse case much the nfl has suspended him from the minnesota vikings with pay and currently reviewing his status. back to you guys. >> kate, thank you very much. just a quick reaction here, guys, on this nike dropping adrian peterson? >> that's pretty big. obviously, that means that they think this is a much bigger deal and he cut that plea bargain deal with texas because this's where, of course, the alleged crime was committed. i can see why they might want to shy away from him here, more so than tiger woods, bus one's infidelity issue, the other is child abuse. clearly, nike can't be any part of that child abuse side, given

the -- where they sell most of their product and who they sell it to. >> you remember when, you know, when this was really intensely in the news and all the pop is source did come out and they wanted the nfl to take a hard rain after the flap. to me, not that surprising a decision, honestly, say the difference between tiger woods, i mean, if this were la prom james, might be a different story, too, because a running back, as great as he is, is just not the same kind of marquee sponsor. >> i hate that though. you lake to think it is all -- >> not just a player, it is also, you know, individual names, where they can have liabilities, that's easier for nike to pull that the overall nfl. up in of the sponsors back on the nfl, during all of these criticisms of roger goodell, handling of everything. you would expect to see it at individual player basis here. >> there's a clause that says we can basically handle this. a quick break. disney not the only big name reporting earnings. after the bell, run through the numbers next. and thesome & p 500, 14% past year, you will be shocked to find out which stock has been

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for earnings. kate rogers rounding things up. >> kick it off with disney, the company matching street estimates with an 89 crept gape. revenues coming in bait above street scripts. the stock is currently trading down in after hours. zynga down 1 penny. mobile gaming push in motion with releases such as new "words with friends." to the stock is trading up in after hours. king digital posted better-than-expected third quarter russell and announced 150 million stock buy back program, king damage tall up 1.5%. and ubiquitity next worked creamed after posting weaker than expected earnings and guidance shy of expectation. that is trading down and we will end with gap reporting october.

green mountain coffee by and far the best of the year. "shark tank's" kevin o'leary, there he is. is here to weigh in. and americans steal from their employers more than every other country in the world. the shocking amount costing businesses and the economy when "closing bell" tops. ♪ there's confidence... then there's trusting your vehicle maintenance to ford service confidence. our expertise, technology, and high quality parts means your peace of mind. it's no wonder last year we sold over three million tires. and during the big tire event, get up to $140 in mail-in rebates on four select tires. ♪

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"shark tank's" kevin o'leary, st quick, easy experience. get your car, and get back to the life you love. welcome to the future of car-buying. welcome back, green mountain is brewing up chatter about its stock verizon. >> it is the best performer of 2014, the best performer going back 12 months, 142%. david even who were, the hedge fund manager, just yesterday, three-quarter investor letter, finally threw in the towel and said, enough of this short. it has about a money loser for him. put that back on in 2011. er can rig is defining the entire consumer staples industry now. boring the consumer staples, slow growing and up exciting.

er can rig thinks of itself as a technology leader. completely different. has the innovation and disruption streak you do not see in consumer staple names. goldman sachs, a list bullish, calls it a disruptive innovation story. >> gonna continue. we have breaking news. kevin o'leary from shark tank is here as well, breaking news on bank of america. seems like deja vu, you are probably not alone. bank of america is adjusting its third quarter earnings by $400 million after learning material information that its legal fees are rising on the back of this ongoing multibank probe into manipulation of the foreign currency market. this will bring bang of america's previously reported earning of as will of one crept per share to as will of four cents per share.

to refresh your memory, wall street a lists expecting as will of nine cents a share, would characterize a beat for bank of america and as we told with you citigroup, the reason why banks have to go back and i a just the prior quarter is because if they come into possession of material information before they make their quarterly filing public, then they have to include it in the prior quarter and not the recent quarter. so, that's just a little bit of legalize around why we are seeing this. already, the third quarter for b of a was already mar bade a massive legal charge associated with a $17 billion settlement with the department of justice so while this certainly is smaller expense for them, seems like tab keeps adding up for bank of america. for now, kelly, headline, $400 million of legal fees added on to bank of america's third quarter, cutting its profit to a loss of four cents a share. >> get more reaction with men depp capital's a top shuts joining us by phone. great to have you here, a top.

reminds of about a week ago, citi the first one out with a adjustment to its quarter, i think 600 million, that figure was, since heard from a couple of others. so, why this -- the way which it was all reported, citi didn't say why at first it had to do this, bank of america more explicit with regard to their ethics probes. what do you make of this? >> sit has certainly bounced back, hit on the news, come back and, you know, up fortunately, it's business as usual given the environment we are in right now, where banks keep setting. bank of america set aside $17 billion last quarter, what's another 400 million on top of that? with all these banks like to get investors like to have it behind them. i'm in boss. at a bank a list association and the talk is this a rain of business? is this normal operating earnings for these banks? they just keep getting hit over and over and over.

curious as well about the timing here. i don't fully understand how these banks can put something basically in the quarter when the quarter already happened. it's all about regulatory filings and since this is the filings coming out and material, you know, i think kayla made that point, i think she is right. and if they know about it before the timing comes out, it's -- again, $400 million is a lot of money, but you know, given bank of america's balance sheet earnings, pales to the 17 billion they did take a charge last quarter. >> a top, we have heard from citi, b of a, barclays somewherele to.this, news with regard to the foreign exchange probes in the billions of dollars globally priced into all these shares or are people still having to make adjustments as numbers come out to figure out how big the types may be? >> i think that it's pretty well known. i think looked at a bunch of the filings but the legal serves across the industry. you talk to everybody,

certainly, there's about some talk on the street about jp morgan, about probes regarding, you know, criminal matters, which we hope that doesn't go that way, hope it gets settled. pretty well nope at this point in time.what is the next shoe to drop in the bigger banks about the republicans whipping, the question is it friendly to the big banks and the answer is not. >> that's reference to richard shelby, we expect to be the next chair of the senate banking committee. thoughts on this one, guys? >> we knew this ethics probe was in the works. i wonder if you're still there, if you have any guidance on when we are going to get the settle., headline number, seeps like banks that have the biggest foreign exchange spot trading desk, deutsche bank, jp morgan, citi, get hit with the biggest phipps. i think that's absolutely right.

[ inaudible ] i think the same characters globally, the question i have are that the [ inaudible [ inaudible ] read the line from bank of america's press release, they attribute this to the company being engaged in what they call accept pratt vans discussions with u.s. banking regulatory agencies to resolve matters associated with fx, a little bit more specific in terms of what we saw with citigroup's original press release, then in their quarterly filing, we saw them detail several different agencies, both here in the u.s. and abrad in the uk and switzerland that were involved in this probe, appears from bank of america these are advanced discussion with u.s. regulator, an important distinction here, people are

talking about the fact that now that some of these numbers are coming out, banks are taking serves for them that they have a number in mind, they have a price tag, at least so far as they have about told from regulators that this means that this could potentially be imminent in a matter of days. if not days, weeks. >> a top, let you go, appreciate your officer perspective, more on this news from bank of america after a quick break.

welcome back. as mentioned, bank of america

reporting a adjustment to its third quarter rules because of what it is saying is related to a foreign exchange probe, on the back of citigroup doing similar and other banks reporting similar settlements, if you will, or the need to at least get at what's going on with regulator as they further look into this matter. the papal still with me, along with our kayla usual ship kevin o'leary is here swim. i'm curious, your thoughts as you look through -- the banks -- any hope of them being a kevin o'leary dividend player, show me the money, clearly out the window at this point. >> i'm a b of a shareholder and so also an o'leary funds third waiting. here is my frustration. we have to go to a philosophical discussion in america, these are our financial infrastructure instruments, a big bank, jp morgan the same, citi the same, why do we keep stealing their capital? what's the point? why doesn't the bank fight back? i'm a shareholder. i'm okay with them fighting back. >> if they did something wrong, what's to fight back about?

>> let that be determined in a long, draw up out process. >> a expensive one, as a shareholder, do you want that? >> every week, i'm losing $600 million. i can get a lot of lawyers for $600. let start fighting. enough already. the government is stealing my money. that's what's happening much we already paid. we have already paid. when you give into a bully, kevin that's what happens. the bully just keeps asking you for another -- >> time to make them claim their case in law. >> yep, make them prove it. >> make them prove it. i don't care if we spend $1 billion going through the process. somebody start fighting back. roonch reims and reaps of chat rooms of collusion ethics probes. >> in manies i can as, smoking gun e-mails or chat room conversations details thee back room deals, they have basically agreed to map nip late certain prices. >> kayla, prove it in court. prove it in court. bring out the e-mail. let's go. >> that should be a criminal charge against those individuals, unless they can say

that the supervisors and so forth all the way up to the top at citigroup, bank america. >> some banks still being looked a the for potential criminal activity, but kevin, the question remains how much more expensive is it to fight it in court if the evidence is ultimately against them? >> kayla, when we were -- >> why wouldn't you do that? >> in the middle of financial turmoil in 2007, 2008, we went to these banks and asked this emfor favors. i say we, i mean the taxpayer, the government, now we have turned around -- >> i think we rescued the banks, bailed them out. >> they paid us back, made money, now top to screw them into the boards with these costs. i, as a shareholder, just one voice, i'm now giving permission to the ceo to fight back. i'm done. i'm -- i have a he had enough. 17 billion. i'm gonna hold i don't to it, this company, if it ever was give a fair chance of a court of law, could make me money, increase dividend shall, the only reason i up it. >> this particular case, hard to prove, in the for rex market, $5 trillion a day what toward prove

that they actually benefitted and kayla's point, which would suggest they probably have evidence of e-mails or chat room where this there was some sort of -- >> and or they are just not willing to fight, to coach's point. i'd low of to see them fight, big tobacco didn't just roll over when they had settlement after settlement and then finally just said enough, we're not gonna go with this, we will take you all the way as far hernandez a hernandez goes, they should do that, too. if they don't, keep getting -- >> i think we have now learned that there are benefits to being a tremendous, very complex financial institution. you're too big to fail. you get rescued. also, investors don't really know what the performance is at any given moment. bank earnings are best case scenario snapshot revised later, stock's down 1% now. know how the big guys operate. >>ic think there has been, kelly, this mantra from the banks, these are a few bad alps, be it one person or a handful of people and so i think that

there's a certain feeling where they really want to distance themselves from this activity and they don't necessarily want to go to bat for some of these people who have since about fired or since been denoted. there is no. very wide holders of these stocks, that's the point that this is not going to affect their dividend, not going to affect their buy back it has nothing to do with the capital return process, which at this point in the cycle is the most important thing for many shareholders. that may be why we are seeing, as michael mentioned, shares only down about 1%, still philosophical debate rhames. kayla, thank you for now stealing from your employer, next be, turns out americans do it more that every other nation, a interesting segue. maybe why we take so little vacation. that story is next. could booze be the answer to getting things done in washington, d.c.? much i would enjoy having some keep keep bourbon with mitch

mccm mcconnell. that was president obama yesterday. we will have the chairman of the famedmaker's mark on whisky being a possible dealmaker. we will be back. man dad,thank you mom for said this oftprotecting my future.you. thank you for being my hero and my dad. military families are uniquely thankful for many things, the legacy of usaa auto insurance could be one of them. 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. today could be the day. the day we give you hope. relief. a cure. today, we believe every life deserves world-class care. as one of the top four hospitals in the nation,

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welcome back. american workers are big time bandits.

americans stealing from their employers so rampantly the u.s. ranked second behind argentina in employee theft. in most countries shoplifting makeses up the major thift retail revenue lost. let's bring in the panel. kevin o'leary still here for their thoughts on all of this. we got a little below -- past the headline to figure out what's going on here. i think this is actually american charity. the american spirit of kindness. it's people swiping their coupons and giving you a discount they really shouldn't at the checkout. >> that's one way to look at it. >> stealing inventory is a discount gift? >> i say -- >> that's less what's happens here than elsewhere. >> what should happen is shrinkage has always been 2% of sales. and if a company really wants to go after its employees, let's say apple if it's true they were stealing high margin items or expensive items, take a couple of them and prosecute with extreme prejudice. make an example of a couple

every quarter. you'd see shrinkage slow down. >> i'm trying to figure out why the u.s. over and above others. people are not particularly attached to the jobs they have at the checkout counter. it's very common to have these things be not really -- it's not a long-term gift. >> is it a cultural thing? >> i wonder if the cost of getting caught is not that high. >> not like loyalty to the employer is going to keep you away. >> kevin, you work with small businesses all the time. how high up is this in their list of headaches? >> what i say to kids in these jobs in their mid-20s is, it doesn't matter that it's $1 or $2 or $200. once you get nipped for this on your resume, you are done. >> let me -- >> it goes to the moral fiber of who you are. >> stealing inventory, those kinds of things, i'm totally with you. there's a portion of this in the u.s. which is people, for example, you are at a tjmaxx.

you aren't a card holder. okay. i'll still give you the 20%. it adds up to an $18 billion loss, but do you have a behavior with -- >> it's not gray. it's binary black and white. >> you've never had someone swipe a coupon for you? >> i don't want to steal from everybody. i tell this to everybody who works for me and with me. don't do this. it hurts you in a way you can't even know. and that's -- look. if you have to steel somethisomethin steal something. >> then it's good for advertising -- >> if you walk into a high end department store and the person there who is your usual person that serves you said, i'm going to hold this until next week because it will be on sale. does that person steal because they told you to wait? >> no, i think in that case, they are marketing. >> that's customer service.

that's going to bring you back. >> when somebody sends me something for free, i know it's not for free. and i send it back because i want to buy it if i want it. i don't need to have it for free. >> setting a good example. many a business deal has been made over a good cocktail. yesterday president obama suggested he and mitch mcconnell may throw back a bourbon or two to get things done. one of kentucky's top bourbon makers joins us to say if it can help the d.c. dysfunction. stay with us. she inspires you. no question about that. but your erectile dysfunction - that could be a question of blood flow. cialis tadalafil for daily use helps you be ready anytime the moment's right. you can be more confident in your ability to be ready.

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welcome back. during president obama's news conference yesterday, he said he'd throw one back with senator mitch mcconnell to get government moving again. >> i would enjoy having some kentucky bourbon with mitch mcconnell. >> so, which bourbon maker is going to step up for the challenge? with us now is maker's mark chairman emeritus. it's great to have you with us, bill. and we joke a little bit. this could be a boon for your industry, couldn't it? >> i think the president is up to something. i think he's right because i've already been there. i've seen it work. back in the mid'60s when i was an intern in washington,

sponsored by republican senator cooper from kentucky, he took me over to the white house on several occasions after 5:00 with a bottle of maker's and he sat with democratic president lyndon johnson and you would never know they weren't brothers. the jokes, the good times. there wasn't much left in the bottle when they finished, so i am sure we had something to do with the -- with lubricating the situation. i don't see a reason it can't work today. >> kevin is that how you -- >> i think he's spot on. i think we'd get a lot more done in the country if the president was drinking more. he'd be a lot more flexible. >> you have the wax drip on the top. i notice there's a little pig on -- an element to tell -- it tells me it was done by a machine. he's are not hand dipped, are they? >> they sure are? >> then somebody is doing a terrible job. i have to show them how to do that. >> no, no, no.

they are all supposed to be different. >> i want to show you -- >> it's a little -- well, that was the way it was designed. my mother designed it and nobody argued with her. >> in france where i was once doing this, you do not want to have that bump there. you want to lift it up and do this magically like this. >> do you think that's going to have the president -- >> have me come down with your mother and i'll work this out. >> the main issue is, we can help solve the problem. >> all right. >> hey, bill, i'm a whiskey, bourbon drinker myself. i like it with a little ginger ale. what are you seeing? is bourbon continuing to grow at the expense of wine and beer? >> well, it's at the expense of something because bourbon is really an a run. 95% of it comes from kentucky. so the kentucky economy, the manufacturing economy is really being supported by these incredible increases in the bourbon industry.

the number of jobs has increased 100% in two years. the average wage is about $90,000. >> and i -- listen. it is phenomenal. we'll tleef right there so "fast money" can begin its show. glad you're here. >> "fast money" begins right now. live from the nasdaq market site in new york city's times square, i'm melissa lead. if you are wondering why we look more dapper it's because we're getting ready for cnbc's "next 25" gala event. we'll bring you vip access to the red carpet. also the founder of the first 25 list here on set to give us his exclusive insight into india's tech revolution. plus regis philbin will be here on set.