to keep trying to and trying to anding, that's the key, every entrepreneurial success story is about determination. >> that's great nugget and ray croc's company invented the mcnugget, they are related. you are very quick. you could be on tv. >> i could. >> nice to be here. thank you. >> thanks for watching street signs, everybody. >> "closing bell" coming up next. and a welcome to the "closing bell." i'm kelly evans here at the new york stock exchange. >> i'm bill griffeth. dow 18,000 -- it is looking doubtful right now after the central bank in europe signalled that it will stand pat, at least for now, and then we have new head lanes around midday it could prime the pump some time in january. that seemed ton turning things around a pretty volatile day for the u.s. markets. we will get a view and exclusive interview with the ken fish he, joining us here at the new york stock exchange the next few minutes, news of yes thinks the

global markets are going now. >> don't do it today, hitting that 118,000 mark, could tomorrow's jobs number put us over the top? a closer look at what people are expecting tomorrow morning, when that all-important report from the labor department is released, 8:30 a.m. morelier oil prices today as we showed here on "closing bell" yesterday. some stations, look at that we did it, $1.99 a gallon. that's why a few politicians now from both sides to of the aisle are starting to talk about the possibility of raising the gasoline tax, which hasn't been done in about 20 years and use that money to help fix our crumbling infrastructure. we have a de bit on that. our friends kudlow and frank will be joining us. that should be fun. >> looking forward to that. will have a chance to weigh in. here is what we see on the markets, an hour to go in the session it is the oil names again which are weighing on the dow, off about 16 points. seems like chevron off about 2%. exxon down about half of 1%. the s & p dividing up to 20.71.

the nasdaq ever so slightly staying positive here as we have been debating how -- speaking of key milestones here, how much longer before that index retakes 5,000? but that will be a conversation for another day. >> all right. meantime, have this conversation for this day in our "closing bell" exchange, cnbc contributor heather hughes from sun america funds at the new york stock exchange with us today, jeffrey cleveland from paint and rigle, jim lowell from adviser investments, mark tepor from strategic wealth partners and our own rick san telly, mr. santelli, i will start with you. not only the drag guy comments today, you had vladimir putin making comments, pretty strong comments about the west, you know, oil went lower, the euro was strong today. our yields were moving. what did you make of all the markets and what the message was? >> you know, personally, i would probably put as much belief in comments from putin as i would wait till next meeting. listen, as far as what the

european central bank does, just like our fed, nobody knows. but what i can tell you is there's probably a gaed chance something is going to be done, it doesn't have the backing of the germans, even if it is done, think that presents a whole other set of issues, at the end of the day, i think that feds placer has it right. central banks are looked to to pick up the slack of the lack of the political class address the ills. either the central banks didn't go big enough, 'cause we don't have enough bang in the global economy, or what they are doing isn't going to create the bank. i think it is the latter, one or the other, still surprising to me how few question the benefit of current policy. >> well, we have a big data point coming up tomorrow, jeffrey cleveland, how high are market expectations for the jobs report here and for how well that important part of the economy is doing? >> hey, kelly, good to see you. you know, i think that far too much emphasis is put on that no

farm payroll number. we have had 200,000 for nine consecutive months. i think we will get somewhere around that tomorrow morning and that's fine. what's missing as rick alluded to is the long-awaited inflation. we don't see it in wage growth. don't see it in core inflation measures anywhere in the world, sentra banks haven't been able to bring that back to life and i think that's really what's driving markets, especially interest rates. so, ignore that headline, non-farm payroll number, whatever it happens to be tomorrow. >> than as it may, we are going to press on and emphasize it a little more, jeffrey, mark tepor what are your expectations? i have heard as high as 220,000 possibility for non-farm payrolls, what are you hearing and what are you expecting? >> yeah, i think right around 200 or so is probably where it's gonna come in at, i would agree with jeffrey, i think the biggest issue is the lack of wage growth. that's really going to be the biggest headwind that's going to be working against the consumer over the course of the next year

or so. there are tailwinds for interest rate, applications are declining and the biggest headwind for the consume certificate lack of wage growth and because of that -- >> talk about this a lot, just making a couple of points here quickly, one is that the drop in oil prices is actually increasing real incomes, full, so that will be something to watch for tomorrow. the other is that average earnings numbers, still only 2% year on year. if you take into account the total income earned in the economy because more people are going to work, that is actually a much healthier amount. i'm just curious, mark, if that is going -- it would seem to me obvious that it must have an impact, not there yet, but the progress certainly being made. >> absolutely. definitely have a positive impact but like when you look at consumer spending and again, consumer spending is 70% of our economic growth, yes, lower gas prices definitely help. but there's just as many headwinds working against us that because of that, we expect

consumption, really just chug along. we don't expect an acceleration nor ex-sect a deceleration in consumer spending over the course of the next year. so what we are looking at is really just more of the same. >> yeah, could some of that wage growth, lack of wage growth be offset, we were saying, by the fact there is no inflation, lower oil prices right now? a strong doll czar could that help this lack of wage growth we are seeing in the employment situation? you look at this so-called quit survey or quit ratios, people are very confident now, dropping out of the labor force, they are quitting their jobs shall right? so that's another aspect to the labor markets that we are keeping an eye on, that may be a positive to make up for some of the lack of wage growth. eventually, when you don't have the supply, then where that equals demand, you will eventually have to boost wage growth. >> jim lowell, you are not very high on the consumer at this critical part of the season, are you either? >> well, not in terms of more ugly christmas sweaters. i think retailers might take it

on the chin. in terms of technology, electronics, things that consumers are clearly spending significant dollars on, remain fairly upbeat, i hope mark's right, we do get more of the same in 2015, would mean another 15% up on the broad markets, i will take that any day. i like what we saw from construction spending and also car sales. not only are builders more confident about buying more homes but the second biggest investment for consumers, their car, those are flying off the lots at reasonable prices and great lending rates. so, i think the consumer heads into 2015 in very good shape and that's 'cause the u.s. consumer, i have said it time and again, i think so goes not just the economy. >> we did see black friday somewhat disappointing though, it wasn't gangbusters when you compare it -- >> but counterbalanced by a dramatic uptick in online shopping and that trend is clearly helping offset that. >> i'm just daughterious, jim, we talk about tomorrow in the possible outcomes, 'cause this sets off not just the tone for the day but for the month,

frankly, and the last month of the year, what are the two scenarios here, if we have a beat, a 250 or almost 300,000 number, would probably take to be a beat versus a miss, what do you think are the two different ways in which the market reacts to that? >> well, the perfect question. i think if it surprises significantly to the upside, then every fear about the fed raising rates sooner rather than late letter sweep in and actually knock the market back a little bit and the contrarian move would be if it comes in weaker, then stimulus measures maintain at least a mod couple of presence long enough to continue to embolden not just consumer spend bug the broader markets, so i think a miss in a contrary way could be better for the markets, at les on the day. >> where are you putting money to work right now? do you see high her, you know, everybody is -- at this time of the year, they start reassessing their views of the market for next year, raising their targets on the s & p, what about you guys? >> we thank you good time to be

in the bond market. >> wow. >> the interest rate situation we think is going to be with us for some time. the disinflationary trends that we are talking about here are global and so that means i think a low-yield environment, still need to look for income. we are not in the camp that's been running around telling people that interest rates have to be dramatically higher and you need to get out of bonds. we still like fixed income, we will continue that mantra into next year. at least it has been this year. rick, what were you gonna say? >> you know, kelly, yesterday, when we saw the productivity and unit labor costs, a lot of stories written, accurately so, big drop in union labor cost isn't presenting an optimistic picture of wages in the future and i think that's something that we should pay close attention to in tomorrow's number. >> goes back as well to the swirling and endless debates over health care and at extent to which employers, bill, are having to pay more compensation in the form of health care as opposed to wages themselves. >> mark tepor, i'm going to ask the same question to you for next year, but you're not as high on this market. you think the easier gains are

behind us now. why? >> absolutely. so, one of the big concerns has been, you know, what happens when the fed begins to raise interest rate, if they even do that in 2015. you know, when interest rates, when the fed is actually easing and interest rates are below e equill librium, the mean annualized return is 21% that year since 1961 the next phase as the fed raises interest rates but rates below equilibrium the mean annualized returns during that phrase 10% a year. positive 10% still a great return but not the 23% we have experienced in the past. >> you can also look at the fact that everyone is saying, well, the rest of the world is very weak, can the u.s. markets, can our markets still do well, even with a rate hike orate rise in mid-2015 and the answer would be yes, it is possible, and the second quarter of 1997, you saw the asian market crisis, you saw russia and the economic

sanctions, japan was very weak, and we had a rate rise. >> 97 or 2014? >> i have to check. exactly. haven't incurred that rate rise yet that did happen in 1997 in q 2678 the rule was the markets in the u.s. still did okay. they held up nicely. so that is a possible scenario. >> the more things change. >> oh, brother. get to you the that playbook, dust it off. thank you all. heather, see you later in this hour as well, the closing countdown. >> we have about 50 minutes to go here, still looking a at loss of 20 points on that dow with pressure on the energy complex and now the nasdaq has turned negative to join it although only by about a point here. coming up, widely followed ken fish letter talk with us exclusively, he manages nearly $54 billion in assets. tells us how he is putting that money to work now plus stock picks you cannot afford to miss, one to those stock picking guys that loves to -- he will make margins in the newspapers and --

also ahead, you into you this would happen, gas prices plunging in response to that plunge in crude oil. now, some want a new gas tax to use it to fix the nation's crumbling infrastructure, fund the highways, is at a a good idea? well, our live poll is now open. go to cnbc.com/vote to throw in your two cents. >> in favor of higher taxes? we have former massachusetts congressman, barney frank and our own larry kudlow. guess which sides they are on on that -- on that issue? >> no surprise. >> may surprise you. >> we will be back. e

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minus signs go into the final hour of leading, the dow was down 98 points, well off that low, but still down 23 here. the s & p down 3 points. so, no record, at least at this point. any positive close would be a record for the dow and the s & p p. yesterday, a record close for thesome & p, the 48th time this year that the s & p has closed at a record high. >> and that rivals 1929. >> it does. >> the number of record closes a year we love to talk about here. >> what's our point?

so, going for the win somewhere. >> the russian market continues to take a dive, down 3% today, and vladimir putin pointing angry fingers at the west in his state of the nation address. >> translator: how did the dialogue on this issue begin between russia and its american and european partners? i mentioned our american friends for an are, since they are always influencing russia's relations with its neighbors, either openly or behind the scenes. sometimes it's unclear even whom to talk to, to the governments of certain countries or directly with their american patrons and sponsors? >> for more on this bring in john brown, actually call him lord brown from euro pacific capital, georgetown producer angela stent, angela that certainly defines the relationship between the u.s. and russia. what do you make of vladimir putin's speech today and i mean, a tenuous relationship anyway for the last couple of years is

it getting worse, could it get better what. what do we have to do here? >> i think it's definitely getting worse. this was vintage putin. as you said, he blamed the united states. he blamed the west for all the ills of the world. he is also shoring up his domestic base because the people who live in russia must be feeling the pinch, the ruble's lost a third of its value since july and you know, unemployment will probably be rising you. the statistics are not good. so, who to blame? you blame the west. i mean, he even went as far as to say that, yes, the west was trying to dismember russia, but russia had managed to beat hitler and it will beat whoever wants to dismember it again. so, that's ratherty strong stuff. >> john, how much room does putin have to maneuver, especially on the fiscal side here? >> it's very difficult. i think he's overreached and sounding a bit desperate. 45% of russia's revenues come from oil. admittedly, that's hard

currency, but as angela said, it's 30% down the ruble in the last six months and 40% down this year. most crucially, they have reasonable lifting costs and discovery costs for oil, but more crucially, the budget break even value for oil is based on $102. so, if we are less than $102, they are having to cut back on their budget. and that means suffering for people and this coming on top of a world recession, eu and united states' sanctions and now, the saudi u.s. oil weapon is beginning to hurt and sounding desperate. i he has overreached about crimea and now that caused a backlash. >> what does he do? a politician that's got to -- he is facing a recession next year. they want to point fingers and blame somebody else for all of that. apparently, the sanctions are working to some degree, but this is a guy who doesn't take things

lying down, as we all know. so, what do you suspect he is going to do about it? >> i think he is -- he doesn't -- i think he wants to keep going and tough sort ofsome -- of sas attitude about t i don't think hell back down about crimea, vital war report, but i think he will sue for negotiations with the united states and the european union over ukraine will back down on ukraine. i think he will be forced to. the russians are wonderfully stoic people. >> and the comments that he made about the ukraine and about crimea, he compared crimea to the temple mount for the jews much doesn't sound like a speech that left him any room to become down there. >> that's big talk. >> hang on, john, hang on. this is for angela. sorry. >> sorry, i'm sorry. >> no he is certainly not gonna back down on crimea, when i was a meeting with senior russian officials a few months ago, they

said forget about it crimea will be part of russia forever now. i'm afraid i don't really think that's going to back down on eastern ukraine either. i think we are gonna have a stalemate for the foreseeable future. i think quo have another russian military incursion come this spring, depending on what happens there. i thinklogically would you think this would be the time for a off ramp, as our president said, but i don't think any signs at the moment that mr. putin or those around him in the kremlin are really willing to back down on eastern ukraine and certainly, never change the status quo in crimea. >> what do you think he does economically? okay, militarily, maybe he holds his ground even though they have been weakened by the, you know, the decline of the ruble and decline of the police of oil, but what does he do to tray to turn things around economically if they are, in act if a, are going into recession here? already talked about freezing tacks on small businesses? >> amnesty for capital. he put out, you know, a feeler

to those russians that have parked a lot of their money abroad. said if you bring it back, there will be an amnesty. >> like that's gonna happen. >> create better conditions for business. >> right. john, what do you think? >> well, i agree with angela. i think -- but i disagree, i think they will actually back down in the end over ukraine, although not on crimea. but i think, you know, they really got to start incent advising and i think these -- incentivizing, think the tax cuts, if they can afford them, will help, a big weapon the coming winter in cutting off oil. they provide 30% of europe's oil -- gas, i mean, gas. and that is still a weapon that can be used to encourage negotiation that i think will take place over the ukraine. >> briefly before we let everybody go here, what did you make of the stunning reversal on south stream and the implications that holds for the delivery of gas to europe? >> i think that was the effective decision of the european union and they put the

squeeze on russia, now the pipe lines will have to go through turkey and into a port on the greek border. and so i think that was effective work by the european union. >> about you they are dealing with a pretty strong guy, that's for sure. >> yes, yes, but -- >> go ahead. >> ask us like the soviet union before and gorbachev, you cannot fight a war without an economy and the economy has to be strong for you to go to war. britain learned that in the first world war. >> go to the go, john, that was your last word there, angela, thank you, good luck with the book as well, thanks for joining us. >> thank you. >> thank you both. really appreciate it. a great point. >> very, very important topic we need to keep an eye on there. 40 minutes left in the trading session here, the dow down 50 points, the midpoint of its trading range today, the s & p down 6 points. wall street veteran ken fisher says political gridlock in washington may be good for stocks, fisher talking market, fed policy and a lot more coming up, plus he has a couple of stock picks he says are ready to

make investors real money. also ahead, gasoline prices plunge, as we know, so is this the perfect time to increase the gas tax to fix our high waits and bridges? barney frank and larry kudlow taking both sides of that trade, coming up. we want to know if you support higher gas taxes to fix our infrastructure? you can take part in our live poll right now at cnbc.com/vote. look at that >> it's even. who are you people? >> back in two. -800-345-2550 [ male announcer ] your love for trading never stops, tdd# 1-800-345-2550 even on the go. tdd# 1-800-345-2550 open a schwab account, and you could earn tdd# 1-800-345-2550 300 commission-free online trades. tdd# 1-800-345-2550 so when a market move affects one of your positions, tdd# 1-800-345-2550 schwab can help you decide what to do. tdd# 1-800-345-2550 with tools like free live-streaming cnbc tv tdd# 1-800-345-2550 that give you the latest financial news and trends. tdd# 1-800-345-2550 and bubble charts and price charts that let you see exactly tdd# 1-800-345-2550 how market activity is affecting your positions. tdd# 1-800-345-2550 so when the time comes to decide whether to scale in tdd# 1-800-345-2550 or scale out you can make your move,

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looked like stocks were headed for a bad day if you were a bull, before a midday turn around, down 55 points on the industrial average. dominic chu, tell us about movers in. >> a seesaw session here, start with barnes & noble moving lower after posting weaker than expected second quarter results and buying back microsoft stake back in the e reader business for $62.5 million and 2.7 million shares as well. see the shares down 6%. kroger moving higher, the country's biggest supermarket operated reported a better-than-expected jump helped by the acquisition of harris tetter, also raised its full-year earnings forecast. as a result, shares up 3 1/2%. air lanes soaring as oil prices continue to fall, majors, united, continental, delta, jetblue gaining ground in today's trade and end with starbuck, projecting revenue to approach $30 billion by the year 2019. also said it would add beer, wine and evening snacks to

thousands of its domestic cafes. starbucks amping it up, at least on other snack fronts here, with regard to its offering, kelly, bill, back to you gays. >> thank you for now, dom. falling gasoline prices and crumbling u.s. infrastructure can mean one thing, raising the gas tax. not just yet, the murmur is simply growing, now could be the time. >> ask two guys who have opinions about that our senior ron co-en tributer here at cnbc, larry kudlow and former representative, barney frank, see what they have to say about that and ask you folks as well as part of our quick poll here, unscientific though it may be, do you support higher gasoline taxes to pay for fixing roads and bridges? go to cnbc.com/vote to cast your vote, pretty much even right now. the poll open ten minutes here. mr. frank, 20 years since they raised that -- the national gasoline tax. what took so long and would you favor raising it now? >> well, i should say it's been

20 years since i helped raise it i voted for that increase. i wanted it to be higher. we, in the house, voted to make it i think 7 1/2 cent, the senate knocked it down. frankly, you talk about a 2 or 3 cent range, you will see gasoline stations within a mail of each other there where is that differential. what's held it back, i think, is a -- an unfortunate ideological, taxes for any purpose at any time. given the need to do fix up on our roads and bridges and other forms of transportation, given the fact this is an economic wash. yes, when reduce tax, reduce some of the money in the private economy in this care every penny of that will be spent, productive ways, ways that not only provide jobs, but improve the efficiency of the economy by improving transportation. so i think it's long overdue. >> well, i disagree. first of all -- >> really? >> the gasoline tax was quadrupled in the '80s and early

'90s, if you took the whole period here, would you find it's been rising about 6% annual rate. that's the reason that most people voted against it. second point is i do not think the federal government will do anything efficiently. i think it's proven that, to my friend, mr. frank, i would only cite chuck schumer and his latest discussion. third point is can we go back to the original highway fund to finance interstate highway? this business about financing transit, okay, buses and light rail, trains to nowhere in california and let the states decide if we want to raise gasoline taxes in texas, california and florida, let them do it. let them do it, but not federally, my point is i want more private involvement. we have seen private toll roads, seen private/public sector operation. that's really the hot new thing

in transportation. >> just so people know here, the federal gas tax is currently 18 cents, the average state tax is about 23 cents. >> 23 1/2. >> put that together, you arrived the something like -- >> let me real quick, larry, ask you this, because you bring up the toll roads this leads to an important point. it was eisenhower who created, to some extent the highway -- the freeway system. so that threatening to go by the wayside here if we allow more and more privatization of roads? >> most -- i call them i-95s, most of the federal highways are toll free, you want to keep them that way, i'm fine. but there's a continue of roads and bridges are thank are the no, state and lech a.m. jurisdiction, we have e-zpass. >> the tappan zee bridge here in the city, another $14 charge. i mean, if you are trying to get from new york city to washington, d.c., you're paying probably $50 in tolls. >> that is the thing. i don't want the federal government to pay for that tax fires of new york pay for that i'm okay with that like jerry brown's thing in california,

this high-speed bullet train to nowhere, for god's sakes, starting in fresno, no one is gonna use it when they do use it the toll so high, only rich people can use it why impose that tax on everybody? >> given you a all right to talk about here, mr. frank. >> yeah, first of all, there's no -- state by state is flawed for this reason. you put the states a at competitive disadvantage. talking about a national economy, interstate highway system, you are talking about an economy that requires people to go from one place to another, saying that the state should do it, then you will have every state being told, oh, well, if we do it state x won't do it and state y won't do it transportation ought to be a nationally funded system. secondly, the notion that it quadrupled in the '80s, i don't know where those numbers were. i do know it is, in fact, not increased since the early '90s when we increase it had by 4.5 cents a gallon in '93, zero negative impact. feignly, this notion by larry,

larry, i respect you much of the time but the notion that the federal government never does anything right, that's the kind of mindlessness that isn't helpful. yeah there were terrible private sector mistakes in the financial area, yes, public sector abuses, also some great examples of public sector efficiency, the social security, medicare is more efficient than private insurance and in terms of highway construction, it is done, first of all, by the private sector, there is no federal highway construction crew. what happens is the federal government takes competitive bids through the states, takes competitive bids and the private sector does the building. so being done -- excuse me, larry, you talked for quite a while you talked for quite a while, i'm trying to respond. the notion that the federal government is doing it wrong if there are problems, that's because federal private contractors respect doing it well and we have a very real need for an improved transportation system, which cannot be done as if we were missing the articles of the confederacy. i'm not opposed to the federal government's transportation fund

doing a national highways, not opposed to that i'm staying is the local stuff that should be done locally. >> there's not enough money to do the national stuff now. >> i think there is enough money if you take out the subways and the buses and the bullet trains to nowhere. that's the point i'm making. and regarding the -- >> well, you're wrong. >> the federal government, i just want to say one particular thing is the davis bacon act which studies have shown that's in federal regulation, it creates a prevailing union wage, it doesn't allow people to hire privately and its a he -- raises the cost of project by 22%. >> no, it doesn't. >> i'm not wrong. that is true. >> you misstated that. it does not prevent people from hiring privately. it does say the private hirers have to pay a certain wage. >> that's what i mean. that's my point. >> larry, you misstated the point. you said prevents people from -- >> they can't go outside that, barney. can't go outside that regulation. >> look, larry, i want to correct what you said, let's be clear, you said you can't hire

privately. it sets a minimum, like the minimum wage, below which you can't go. >> to me, private hiring is -- >> larry, please -- larry, you're filibustering. i'm trying to respond to larry's point. he greatly exaggerates the point about transit. yes, there are a couple of the large train things that are expensive but the notion that it is not appropriate to use transportation funds to deal with subways and buses, among other things, of course, it's probably maybe larry does not pay any attention to the whole notion of global warming, he may think that's one of those left-wing myths but the fact of getting rid of or diminishing public transportation, putting more and more people in cars, inconvenient for a lot of people, has an economic negative affect. you do he fund or underfund the subways in new york, you are going to slow down economic activity there. so the notion that somehow transit is some frivolous notion and doesn't belong as a legitimate expenditure i think is wrong on just before he count. >> barney, i just think, barney,

look, here in new york, for example, we pay a fortune for the metropolitan transit association, the mta and still always goes broke. my point is a simple point. if we want more subways in new york, more bridges in new york, fine. that's the thing for new york taxpayers to decide, not the -- >> no, larry, those bridges go to new jersey, they go elsewhere. >> that was -- then let new jersey vote on it, too. we do have an authority that covers that >> but you then have -- >> the point i'm making is the original highway fund was designed not for local transit -- never designed for that and the expansion of that mission has caused us to go broke in the fund. >> i got to go. >> and how should you pay for that? the fact it was historically not included doesn't make it right. that's not a policy argument, that's history these circumstance the fact is that saying we don't -- regarding transit, somehow a defect in the transportation system somehow a weakness is just wrong headed. a good system is cars and it's

inner city trains like northeast, amtrak and transit where that makes sense. >> we got to leave it there, gentlemen. >> guy to go, guys. great conversation, as always. never enough time. but we appreciate it, your thoughts as well. barney frank. thank you, larry. not a slamdunk. >> no. >> but 57% of our up scientific poll said no, not want to see a hire gasoline tax but 43% that said yes. who knows? >> how much? 57%? >> 57%, i'm gonna take that as a win. >> 57% of this audience, you're in big trouble. >> touche. touche. >> thanks, guys. 24 minutes left in the trading session. >> i wish we could leave them micced up like that the rest of the day. >> i love arguing with barney frank, i really do he is terrific. arm a lot of fun to watch. down 45 on the dow industrials. wall street pro ken fisher talks markets and why political gridlock in washington, oddly enough, may actually be good for

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welcome back. our next guest says this is a simple stupid market so we are going to find out what he means about that >> that would mean mr. ken fisher, founder of fisher investments, old friend from earlier days in this whole crazy business that we do here. what's simple about this market? >> this is the kind of past middle stage but not to the end of a bull market. >> okay. >> where you get the norm a process of fewer and fewer stocks leading the market and those that do are big and bigger and you want to keep it real simple so you don't snatch defeat from the jaws of victory and the way you do that is to focus on big, simple names and ask yourself, what's kind of stock that the last greater fool that would get into the market just after it peaked but too afraid to buy a single stock before would buy when he or she

was buying and that would be big, diversified revenue, fat growth margins. >> brand names out there. >> but just big, master, easy,ing me gas keep it real simple, don't try to be too cute. the stock picker likes to dip down for the fancy and exotic. in a world where big does better than small and bigger does better still, which is in the world that normally leads the latter part of a world market and the one we are in now, you don't want to play that, do you don't want to be too cute, don't want to be too smart, you want to be stupid. >> what are your favorite ways to play 2015, being specific now within that broad florida imwork? >> let me go back to something i have done many times before in my annoyingly long career which is you want to focus on largely half of the very largest names and then you want to overweight, underweight, bisector a little, depending what you think about

things. >> you like health care and tech? >> health care and tech and then you want to diversify some among the big easy names so you don't get too cute. >> like who? >> oh, novartis, smithkline, know vo nor, those would be fine there, a couple of the newer big text and a couple of the older ones, again making sure you got some fat gross margin in there they have got room to shall. >> you like apple or amazon? >> apple would be good, amazon doesn't have the fat gross margins. the reason for amazon, it is not that easy to find a lot of consumer discretionary in that area and particularly not sees i do find consumer discretionary in that size range with that gross margins. to do that you're going to go to something more like a disney. >> last night say that they think that 2015 will be the year of the small caps. sounds like you're on the totally the other side of that. >> that does not happen late in bull markets. tra i to find that late in bull market. >> anything normal about this cycle? >> yes this cycle has been very

normal, off the bottom, small led almost perfectly. this market in almost always is archetypal, leads me back to another point. the three sequential quarters, including the fourth quarter of a midterm elections year and the first two are all consistently positive, 84.6% of the entire s & p 500's history, a point that goes past people, the proof statement that market does not discount gridlock, conservatives believe what they think is right, liberals believe what they think is right and the fundamental feature of behavioral confirmation by us is nobody ever learned anything in politics. people don't change their mind and they believe that if they don't get what they want, it's going to be terrible, but what markets like is nothing happening. >> so you seem to be suggesting that, i mean, we've established over the last few years here how the little guy really, for the most part, is not in this market in an active sense, you seem to be suggesting they are going to start come nag this market no you? >> john temple ton had this mar jealous line, a bull market,

born or pest cism, grown on scent mitch, short on optimism and try dye on euphoria. between skepticism and optimism, about where we are now is about midway in the duration of a bull market. this has been a gave-year sober party and we are about to start punching the party and as we punch the party, we get that normal transition which we started this year from small to big and we have a lot of duration. bull markets are also a little like that high school physics vector you learned about, going a single direction until they either run out of energy or they hit something that knocks them and the thing that knocks them is a big, bad thing that hasn't previously been worried about, unless we get that get to euphoria. >> quickly sneak this in, how would you invest if a 65-year-old's portfolio right now? >> a 65-year-old likely today has a 25 to 30-year time horizon. and they need to set aside what they need for the next few years and need to think about that 25

to 30-year time horizon. for that, you need a lot of equity. >> thank you, ken. >> good to see you, ken. >> bill, a long number of years we have known each other. >> you are right. annoyingly long. >> hopefully annoyingly longer. >> yes, let hope some see that bull market continue. ken fisher joining us. 15 minutes left in the trading session here, down 40 points. haven't heard from carbon yet whether the bias is to the up or to the downside as we head toward the close. up next, left behind, dominic chu a special report on which global markets are struggling ass markets make new highs. is the time to buy now elsewhere? these next. e

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introducing wink. it's like a robot butler, but not as awkward. well, as u.s. stocks, not today, but are grinding to record highs, other financial markets have not been so fortunate. tomorrow nick chu back with us looks a hot is playing catch up. tomorrow? >> we looked at a lot of etfs that attract countries and markets around the world, our etfs, wanted to show viewers here about how certain markets have maybe outpaced others and we looked at them since their 52-week lows. the lows they hit earlier this year and then how far they have come off of that if you look at the united states, the s & p 7500, the spdr, the one that tracks that particular index is up about 19% since the low.

so a lot of momentum going off of those recent lows for the s & pment another development market is germany, ewg, one of the etfs that tracks the german mark you the up 14% since its lows the past year, so, some momentum there, look at some of the other names, first of all, look at brazil, brazil is only about 3% above its 52-week low, so, hovering just above -- getting a little bit of a bounce from those lows but not as much as some of these other big markets, that's a brazil. another big one to watch here is what's happening with russia, because russia we all know there are some real economic headwinds in that country, oil prices heading lower, are not helping them, the rsx one etf that tracks russia and basically, the russian market is near 52-week lows, just above them, it's basically right there now. so it's not showing any signs of upside momentum, the rsx one to watch. and then just to kind of wrap it up for the emerging market side ofs e. m is the emerging market's that

tracks them, off 10% off the low. many developed markets, kelly and bill are doing better on the etf side of things than other countries to you the here, guys. back to you. >> thank you, dom. good to sea you. ten minutes to go here to the close. markets can't quite turn positive today though. mesh fre-- pressure on the mark. >> tomorrow's jobs record decide if we make it to 18,000 the end of the week, that is tomorrow. we will preview what to watch for, coming up. here's some news you may find surprising.

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let go back to dom chu for a quick market flash. what do you have for us? >> we are watching shares of starz right now the stock is hitting new lows for the session after a bloomberg report that it was looking at its options after failing to find a buyer for itself. now, you may recall earlier today, our own david faber reported that cbs was not interested in acquiring the company. is a, those shares again, bill, off by nearly 14% so far in today's trade as we approach the "closing bell", bill. back to you. >> dom, thanks very much. heading to the close, about 6 1/2 minutes left now, the dow is down 26 points. heather hughes back with me from sun america funds. ken fisher just making a point,

he thinks the megacaps will see a resurgence here, the little gay starts to put their toe in the water. small cans a lot of people think the russell is destined for good things next year. >> there's still a divergence that is somewhat concerning between the small cap index and large cap index, the small cap, the russell 2000 is not meeting all-time highs. >> lagging here lately. >> right. >> do it is come back next year, do you think? >> i still would rather play better safe than sorry, those large, megacap names that have to agree with fisher here, the dividend, growing dividends specifically, until you see confirming trend from the small cap index where it's reaching all-time highs in the russell 2000 again, i would maybe shy away from the small cap index, even though undervalued relative to say the technology sector and the nasdaq. >> do you agree with this memphis the little guy will start to get into this market? >> where has he been?

>> haven't been in the market unless going through a retire.account of some kind? >> the blink of eye up over 12% the past month and a half, since, what, mid-october? is there aren't too many places to invest when you're looking at retirement accounts other than mutual funds. you don't have a lot of options, most of the mutual funds are invested in the market, not in gold, not in art or real estatement you can see new money come off the sidelines, always talking about cash and new money being put to work, which it hasn't been, so, maybe it's finally next year, 2015 the year. >> are you betting that oil continues lower here? >> well, it's been beaten up bad, so i think when you're looking for value, you can buy the bullet a little bit here and you can await some pain, then it mate not be a bad idea to look at the oil sector. yeah, not low on that play that contrarian play. contrarian play, that's for sure. thank you, heather. come back with the closing countdown, bob pisani and i will

have that in a momentment after the bell, fast food workers around at country walking off the job to fight for the $15 minimum wage, a hot button issue, discuss both sides of it coming up on the "closing bell." you're watching cnbc first in business worldwide.

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90 seconds left here, very interesting day, actually, this is the dow for today, selloff when they opened this morning, the european disappointment that

mario draghi still jaw boning quantitative easing without putting anything out there, saying it will be considered again at their meeting in january, sell off as soon as the european markets close, just before noon, when we start to come back again. we see that so often. the rest of the day, there was a report out that maybe the fed will have to raise rates sooner rather than later. that took us down a little bit. we are coming back, down 24 points. now, quickly, bob pisani, wait for the job report estimates, 200, 220,000 for tomorrow? >> 228, thanks to our partners, we looked at what happens when the market tends to do a little bit better, jobs report is 20,000 or more above expectations, the s & p does trade up fractionally on that day and industrials tend to outperform, makes a little dissent. gold and gold miners underperform, you do the opposite, less than 20,000 or 20,000 below expectations, then you tend to get gold and gold miners doing better and the s & p 500 move to the downside,

makes intuitive sense, but we can now quantify any of these changes. that's what's exciting about this. >> thanks, bob. we will have that job number tomorrow morning, 8:30 a.m. eastern time, right here on cnbc. that's the first hour of the "closing bell" with the dow finishing down about 18 points. here's the second hour now with kelly evans and company. i will see you tomorrow, kell. thank you, bill. welcome to the "closing bell", everybody, i'm kelly evan, no record closing high bracket today, looks like the dow is going out with a decline of about 17 points, actually a pretty interesting session on wall street, even if all things said and done, we didn't move too much here, the s & p giving up 2 points, the nasdaq down about 5 after, trying to stay positive today. again, a lot of that cuke off europe, talk about what's happening with central bank there, what the u.s. fed might be up to. let bring in today's panel, joining me now is michael san tolly from yahoo! finance, our very own john ford and nathan back rack from simple money

advisers. before we get into that, straight over to our courtney reagan now back at headquarters with some breaking news. courtney? >> we are just now getting gap's same store sales for november. listen to this they are really good. gap inc., same store sales up 6% for the moment of november. that is much, much better than wall street was expecting, negative down 1.7% there and if you break it downby brand, gap's namesake stores were the weakest link, down 2% for their same-store sales, gap global for the month of november, banana republic positive 2%, old navy global, kelly, up 18% for their same-store sales for the month of november. >> well, all i can say, courtney is wow. did you say 18% for old navy? >> 18% for old navy. >> if they are discounting to move the stuff, then that either means that they sold twice as much or that the discounts weren't actually that large a huge number. >> it really s at old navy,

offering this million dollar promotional incentive, win $1 million, had early analyst commentary saying, look, old navy could be a winner because of, this the numbers are in, looks really good. >> wow. courtney, stay with us, full. want to intro does our "fast money" trader, guy adami. what do you make of this? >> hi, kell. >> hi. >> one of the better operators out there. them along with macy's two of the better operators in the space. that flies in the face of what you heard from abercrombie & fitch, aeropostale, inventory in line, able to maintain their margins, to courtney's point, i like that stock for a while, i know a volatile one but a name you want to stay with on the long side. >> nathan? >> retail slumming, all of a sudden, abercrombie isn't the big status symbol, a question of i have only so many dollar, keep my budget right sized, with all the energy savings i'm getting at the pump, all of a sudden, old navy you go, oh, look at this label, i have old navy, see if you have one, i think that's what you're seeing when you look

at those old navy numbers, and even to a certain extent, the gap numbers. >> you guys agree? >> i think that gap, through all of its brands, has actually been good online. basically, like macy's, actually have figured out the way to do all the channels now. i don't think this is the kind of growth, doesn't mean a renaissance of the brand, nothing like that the main gap branded stores remain a big problem, getting squeezed, among others, by their own other brands, but i do think they are a good, disciplined operator. what does this mean as a retailer, is there such a story about gap's better performance or first indications that tells us something about the health of the consumer broadly, about other retail names that might look attractive here or no? >> i'm sceptical because it's old navy in this group that's outperforming. if it were banana republic, the higher end of their brands, they were doing better, that would be one thing, gap at their core, old navy, i want to see more numbers, i want to see more consistency, we got excited about gap and what was it colors

and denim earlier in the year, seemed to fizzle out there is a strong mobile trend this holiday season, we had walmart saying that they are seeing people using mobile in stores, price comparison. can they maintain this through the holiday season and after when people are spending on the cards that they get, the gift cards that they get? then maybe to this. >> online shopper will spend about $970 on online for presents go in a mall, spend about $750. what will be really interesting to see is whether or not that online shopper who is spending more is spending more but they are going to old navy or are they spending more, you start to see some of the more traditional retail brands, they start to really pick up. >> part of the reason i raised it, too, just putting it together with a couple other names, including kroger and starbucks, given what we are watching today, kroger that caught my attention, and i confess, these may not be related at all, but kroger comped 5.6%, excluding fuel last quarter and relatively deflationary environment for food. is there some latent consumer

strength here that we have been underappreciating? do you think it has anything to do with the drop in gasoline prices or something else? >> could we start out first with a great cincinnati company and go from there? the ceo started out as a bagger, somebody probably will remember rodney mcmullin stuffing their plastic or paper bags full of groceries. that's great american success story. then could be eating whole foods lunch, simply organic. i think walmart might finally say, you know something, having the grocery store at the back of the store and never having fresh produce and sort of, you can never do a full shop at walmart. maybe as they start to take market share there all of a sudden, you see a.can, cincinnati-based. >> that's two now. >> invite you out. got a lot more revenue than, oh, procter & gamble, who gets all the attention, but kroger just doing everything right right now. >> guys, same question to you, cases of kreerpgd gap doing things right or time to more broadly buy, for example, consumer plays? >> it's a function of them doing things right, but you mentioned the health of the consumer and i don't want us to confuse the

health of the consumer with the consumer's ability or want to spend. i think they are completely different things. people will spend money and we have learned this in the past, never underestimate the u.s. consumer's ability to spend, but it doesn't mean they should be spending or are in a position to be spending. you know, get the jobs number, it's gonna say what it's gonna say, but the reality is the job situation out there is pretty abysmal. that doesn't mean though that folks will look at the stock market, see it goes up every day and feel empowered to spend. that is -- >> good point. >> that is the conundrum of this market now. >> other conundrums include the way in which investors were piling into u.s. equities, by the way, exchange-traded funds, according to trim tabs, month ending november 26th flows into the etfs, up 42 almost $43 billion according to davie san chill, the ceo of tim tabs and joins us now, david. is this because the u.s. story is so strong? should we be worried about this,

from a contrarian point of view here? what do you think? >> we are definitely seeing a at this point of king dollar dynamic throughout the world. and it's definitely worrisome how much money is flowing into u.s. equity etfs. we saw an inflow of 28 billion in november and another 6.2 billion on the first three days of this month. the trailing three-month inflow from this september through this november was 64 billion. that's the highest since late 2008, so, certainly doesn't mean the market's gonna crash but the bullish camp is getting very crowded now. >> mike? >> i guess i would ask, is this not just a coincident indicator? we see hat markets themselves have done. see what the u.s. market led almost everything else. does the money flowing etfs just a coincident realtime read on what we already know about how the market's been behaving? >> well, we have analyzed the flows historically and historically, when you see extremely heavy inflows like

that, the market tends to perform poorly in the short term. etf threes are one of the best contrary indicators in our data sets. >> shaking your head. i think this would be fabulous and go along with you 100% if this was my father's market but this is notship. not a market where the economy slowed down, inventories build up, businesses better layoffs people, wait till we get off deand ma, confidence in the consumer, got that it by debt, led out of it by debt, i don't think the analytics, you can go back to 1929, i don't think the analytics aplay here again. i think right now the trend is our friend. i think this number -- this research will work some day but i think that day is 6 to 18, 24 months out because i don't see recession anywhere on the horizon. if you see it i will buy your numbers. if you don't, i won't. >> no, we don't see a recession either. we just think the bullish camp has gotten very crowded and short term, we don't think

there's a lot of upside based on the big flows we are seeing. by the way, the flows also confirm what we are seeing in a lot of the major sentiment surveys. investors' intel general the american association of individual investors, charles schwab's trader survey, market consensus, showing extremely high levels of bullishness. >> guy adami, bring it back to what to do in this environment then, people pouring into u.s. etfs to some extent, now again, just to cite a couple more reads that we are getting on the health, for example the consumer, out ta nice comp, american eagle, i don't think that is the best tell now. what do you do? >> play consumer, the best way is master card and visa, said it a while, it doesn't speak to the strength of the consumer, it speaks to the way people are spending money and will continue to spend, gone from a paper economy to a plastic one. that trend is going to be continued. big cap pharma, biotech, talked about 1,000 tames. and i remain firmly in that

lower rate camp. i still think the tlt is trying to tell you something and lo and bea hold, all of a sudden, the gold market and the silver market seems interesting. if you want some beta, i think you could find it in the names like silver, wheaton and incredibly enough, a name like knewmon mining. >> contrarian views there another way to talk about paper and plastic. thank you, guy, everybody, david san chi, really appreciate it stick around, catch gay on "fast money" at 5, talking with the ceo of solarcity about the drop in crude prices and the impact on the solar industry. will tomorrow's big jobs report spark a year-end santa claus rally that takes us above and beyond 18,000. up next, tell you what wall street is expecting and what the numbers will say about the state of the economy and your money and the dollar is gaining. oil is plunging and some people are saying that's bad for america. larry kudlow can't understand why anyone would think that. he returns later in the show. stay tuned. (trader vo) i search.

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we didn't quite make dow 18,000 today, but a good jobs number tomorrow could push markets higher, the street is expecting unemployment rate to hold stead date 5.8%. joining me with his predictions for what happens, greg ipp, u.s. economics editor at "the

economist," along with the panel. greg, great to see you, the street sounds like it is pretty positive on the jobs number tomorrow. i have heard it could take upwards of 250 plus in order for that to be considered a beatsome that your focus? >> well, consensus is 230,000, kelly, my own gut sense is while that's probably a pretty good forecast, the risks are on the downside. the last couple of weeks, unemployment insurance plans a bit soft, a bit disappointing, might be a weather effect but a sign of a little bit of an inflection point in the economy not growing quite vidas strongl certain correlation between countries. i would look to there are number to miss on the down side than upside tomorrow. >> speaking of downside, that is one moving lower aggressively surprising way, now we have people as was pointed out today at the fed saying that right now, q 4 is when they think they

should be raising rates, taking it upwards of 1% by the end of next year. >> looking for 5.8% on the unemployment rate, right to me. the labor force participation rate, which had been falling steadily the last four or five years has now stabilized and what that means is that the job -- even when you get strong job growth, it seems to be matched by pretty strong labor force growth, so you don't necessarily see that same drop in the unemployment rate that you would when you get these strong 200,000-plus numbers on payrolls. so i think a good news story tomorrow would be plus 200,000 on pay rolls, 5.8% unemployment rate consistent with a stable to higher participation rate. if the unemployment rate drops, not a bad expectation, puts pressure on the fed to stay with the program and begin the process of normalizing by june of next year. >> greg, i'm wondering whether the drop that we are seen driven by the saud chills gas prices might have some affect on employment as well. when businesses, small

businesses have expenses that maybe aren't as high as they might have expected, are they going to go out and get more labor in advance of the holiday season? do you know how those things tend to trend over time? >> i suspect the sequence goes like this, john, you will see, first of all urge the affect of lower gas and oil showing up in consumption, ought to see that on retail sales, didn't see it black friday but coming the next three or four weeks. that happens, the retailers and businesses will respond to what they see at the cash register. my own thought is this is probably too short a window for a big movement in payrolls. the positive impact the consumption and growth will unfold over a six-month period. jpmorgan thinks you will get a plus 2% annualized improvement in purchasing power from this drop in gasoline prices. and that should give us a nice sort of like tailwind into consumption heading into the first quarter. >> if you can address wage growth, people overanticipated average wage growth accelerant to the upside, given what happened to unemployment and of

course, considered to be until that happens, we don't have to worry about the fed moving fast, are we also seeing potentially a structural demographic effect that's understating wage growth because of some of the similar die nammishs with older, higher priced folks retiring and things like that? >> i have heard that story and people stay is low-wage jobs being created. i think when you get inside the number, you find the compositional effects cannot really move the needle. you still end up with a puzzling low rate of job growth of 2%, this time five years ago should have been 4%. the best explanation is basically lack of bargaining power on the part of workers because unemployment is so high, perhaps this pent up effect that people should have had wage cuts during the recession had wage freezes, businesses are waiting before they start to give them pay increases. but the thing is, if you listen to what folks like stan fisher and bill dudley.from the fed said this week, it doesn't sound like they are waiting for that wage number to pick up before they start to move. remember, wage income and purchasing power is a function of two things, not just the wage

growth rate, it is the job growth rate and we have such strong job growth numbers and growth in hours that we have pretty good income there. that should be enough to justify the fed starting to move. >> greg, couldn't we see a 5.8 unemployment for a long time, a lot of people, nicely say, unemployed, the fact of the matter is out of the workforce long enough the resume has a big hole in it. now of a sudden, getting enthusiastic, pulling out the resume, looking to get a job and all of a sudden that is going to keep that 5.8% unemployment number up, even as you have employment growth? >> the $64,000 question i think one of the things i'm going to be looking at a more than the number is look inside that 5.8% unemployment rate, whatever the number is and find out how much of that is short term, people unemployed six months and less versus people unemployed long term, six months or more. we have actually seen is that the short-term enemployment rate is down 3.9%, basically the kind of level you saw before the recession began and that kind of number has traditionally been a better predictor of inflation

than the overall unemployment rate but long-term unemployment stuck around 2%, coming down but coming down very slowly. one of the interesting things we hear from some fed officials, hey, we might start to see wages start to move because short-term unemployment is now so low, might need to give that room to run to create a strong enough, a hot enough labor market, pull some of those long-term unemployed back in. >> slightly hot, that was the phrase bill dudley used, sounds just like it greg, thank you. really appreciate the perspective as always. greg ip from "the economist." send it back to dominic chu for an earnings alert. >> watching shares of fin his sar, stock lower after posting weaker-than-expected second quarter profits, third quarter earns and revenue forecast came below forecast, shares down 3%. the company does blame weaker capital expenditure spending by telecom carriers one reason why. then out ta salon moving higher, posted better-than-expected third quarter result bus fourth

quarter guidance a little bit lighter, see those shares up by 8%. the company did say it did say that it -- it attributes some of the strength here to better comparable store sales, especially in certain product lines. and family, the canadian government has approved burger king's application to acquire tim hortons. burger king share there is just about flat in the after hours session, kelly. back to you gays. >> all right, dom, thank you. meanwhile, oil sharp decline has been a holiday gift for consumers and the dollar strength showing america getting its act together. why so many people think those two things are bad news, what larry kudlow is asking next. and fast food workers walking off the job across the nation as they demand as 15 minimum wage. we want to know whether you think they deserve that much per hour. your chance to vote on this one is coming up. stay tuned. ♪

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welcome back. there's a look at the u.s. dollar in relation to oil, the currency soaring to a five-year high while the price of oil continues to fall and there are some saying this combination of falling oil and a strong dollar has its share of negatives but they do not include our larry kudlow, who is back with us to explain, larry, why we shouldn't be worried about the dollar strength here. >> i think they are both terrific events. the dollar strength by itself attracts capital from all around the world. holds down inflation. i mean, look, commodities are priced in dollars. it's gonna give the fed reserve some room, actually. lower oil price, i mean, you've heard me say this i just think

it's completely positive. even some of the marginal energy companies may get knocked around but i don't care about that, that's the way the system works. this is really good. this is like really good. king dollar and lower -- all that's missing -- >> sounds like larry fink. >> larry fink said that, i'm honored. >> said it yesterday morning on "squawk box", unambiguously good for the economy. i want a corporate tax cut, i just want to add a corporate tax cut which will give the fed some cover to start normalizing interest rates. >> corporate tax cut and two front teeth are, two good wishes. i like the strong dollar. i think when you hear the discussions about the dollar though, like we have, the question ultimately for investors, okay, how do i play that? do i buy a large u.s. companies? one of the ways to look at it is look at u.s. du, i have been in usdu since last december, up about 8%. it takes the police of some of the bonds that you might have, investor might v i wouldn't begin to look at it as a

speculative vet. i wouldn't look at it on the stock side. but i think there's a place for an investor to start to say, you know what maybe i can still participate in this. i don't think it's gonna have another 8 or 10% on the upside like usdu did over the last -- >> it might. >> it might. >> but i don't think it's got a lot of downside right now either. >> no, no downside. look be, you have -- >> i wouldn't go that far. >> you have, among other things, you have different policies going on here, right? europe is an in a loosening mood, japan is in a loosening mode, the fed is less accommodating, one point, good for the dollar. the second point is if you use the you will mat measure of value, which is gold -- >> chinese yuan. >> gold, g-o-l-d, the dollar really hasn't moved much, been at $1200 for the last several years, okay? i actually looked at the yen and the euro. they only moved -- only lost about 5% against gold. so, i think anything -- i don't think anything all that dramatic is happening except their economies are worst than ours and their policies are easier

than ours. >> larry, are we partly getting that middle class stimulus courtesy of saudi arabia here and if so, how long is that likely to last into 2015? >> quite a while. i don't know where oil prices are going, i'm not smart enough, but they are not going up. they are not gonna go up. people are telling me they are going back to the 8, 900 bucks. >> i think they run energy companies. >> the saudis said $60, they are not in control of the market anymore. so, i can't pick the bought to i think -- at this pace, with gasoline prices nationally coming toward 250, okay, you're right, middle class tax cut effect. that's very positive. it's also, john, very good for companies. look, businesses need fuel, all right, and it's great -- walmart, they need fuel. but they are using oil or natural gas, this is awfully good. >> i would, though, suggest that that is unambiguously good for

the consumer in the domestic economy but it co-it also mean after years of the markets outperforming the economy, it could mean the economy outperforms the markets for a while because one of the reasons wall street people tell you the oil crash is a problem is that cap x from energy companies has been a tremendous percentage of cap x, business-to-business spending which is profits. that's the issue. >> it's not that -- >> and junk bond issuance and all the other financial elements? >> junk bond spreads have winded, some of the marginal oil companies are getting hurt at this, but that's just a small one. the energy boom, i just want to tell you, i looked at this, a couple hundred thousand jobs is all it's been since this recovery. in terms of cap x, a little stronger -- >> i like how dismiss sive you are of a couple hundred thousand jobs. >> but we have created -- from the bottom of the bottom created almost 9 million, it just isn't that big a deal. a very capital-intensive business now with the fracking and so forth.

in terms of people who are worried about this story, my best advice is stop worrying, go back in history. >> i'm going to that. >> take a look at low oil and a strong dollar. take a look at what happens, particularly the '80s and '90s. good things happen. >> my best suggestion, if the average american family going to save $1100 because of the gas going down, put half of it away and then truly be an oil savings that actually got saved and invested as opposed to spent. that would be the greatest benefit. >> leave it there >> the average family can do now >> larry kudlow, good to so you again. thank you so much. president obama says he wants to work with republicans on tax reform when they take over congress in the new year but will they actually be able to work with each other? after years of the president's polarizing messages, immigration executive orderer the latest example, robert wolf, one of the president's top advisers outside the white house is here to next. and we will speak to the new ceo of td bank. we will be back in just a moment.

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welcome back. president obama meeting with ceos across all industries at the business roundtable conference in washington yesterday. one of the key issues ceos were asking about was a deal on tax reform, since the election, the president has infuriated

republicans with a controversial executive orderer on immigration. many say that scuttles hopes of the two sides working together so with me now in an exclusive interview is one of the president's top advisers outside of the white house, robert wolf from 32 advisers. welcome back. >> great to see you, kelly. >> so, what do you think happens here, actually get corporate tax reform done? >> i think it's something both sides wants to do something the business community wants to do, something our country needs to do. >> so it won't happen? >> we are too high of a ray. i think there's a good chance for corporate tax reform. there's slim to zero chance on individual tax reform. and the idea i think would be maybe somewhere between 25 and 28%. we can get down to. and even lower for manufacturing. >> when does the window close for this to get done? >> it has to be 2015. >> first quarter? >> i would say -- i think it's going to be tough, probably first half of the year. you may get into the third quarter, if you can get some stuff done, but between corporate tax reform and free trade would be the other thing. i know you want to maybe

discuss, but those are probably the two main book ends. >> i'm glad you bring it up, because they are the two main book ends and yet a situation where people at the same time say this is a senate where a high proportion are facing re-election, there's a presidential race coming up, practically has already begun for 2016, so, how polarized already is the environment? >> well, i think that's why it's only a few things that can get done. corporate tax reform is universally needed. i think on free trade, what's interesting is the president's for it we have our president's exports council next beek that i will be at, as you know, on december 11th and we have been supportive, as has the president, on free trade for the transatlantic, d tip and transpacific. the business community's behind it what's interesting is it's a much more republican-themed type of public policy thing that the president's really going after. even mentioned yesterday, he said, hey, democrats and the labor unions, get on board. so i think that you're seeing -- those are the two i think main

things that are obviously away from immigration reform that are going to be on the agenda. >> how much has immigration reform detailed hopes of the parties working together come january 1 or when the new congress is in session? >> i think immigration reform's needed. certainly, there's a debate whether executive action should or should not have taken. i'm supportive that the president made a tough decision. i think he's also been very clear that if the -- if congress put something on the table, he will sign it. so, listen, i think it's a polar rising environment either way, but i think corporate tax refarm and free trade is something that the party want -- both sides need to get done. they need to show some movement. i mean, and i -- you know, i would say it doesn't shut it down, but it certainly makes the beginning stages a little tougher. >> you also see not only within republicans who are upset or perhaps trying to figure out how to build a coalition that satisfies both ted cruz and john boehner when it comes to passing a budget but on the left,

meanwhile, elizabeth warren's opposition to the treasury appointee is causing quite a stir in the white house. >> i would say a few things, on budget reform, need to pass budget reform and tax ex-tenders. this country needs certainty on how we are going into 2015. i think that it will likely happen is they will probably shut down some of the budgeting around homeland secure wit a shorter timeline, maybe till march or something, due to immigration reform, but away from that you will probably get pretty much all of it passed. i think with respect to -- antonio weiss, i'm a supporter of antonio weiss. i think the treasury department needs wall street guys and i think he would be, you know, a good person. i think that, you know, you know, if jack lew and the white house thinks he is the right guy, obviously, the business community likes the idea. >> elizabeth warren positioning herself for a career in 2016 for a presidential race or for one down the road then? why do you think -- again, some have pointed out her own nominees to the cfpb, for example, had wall street

backgrounds. do you think this is just politics or does she have a legitimate right to be upset about this no, ma'am facial? >> i think elizabeth warren represents a part of the democratic party that has a very loud voice urge the progressive side. she is obviously an incredibly smart and respected person. she is a little left of where i would be and certainly, i'm more pro-wall street where she would be. i met her when working on the consumer protection side and i think a lot of her ideas make sense. on this one, i would totally disagree her. i think antonio would be good. why think it has to do with you know, getting ready. i mean, one, you know, this whole tax inversion thing does bring a lot of noise up on the hill. so i think he has explained where he has been, but the freshry secretary has obviously put out things not positive for tax inversions. it plays to that progressive movement. but i think that elizabeth warren should back off male and we should allow the treasury secretary to have their undertreasury secretary for domestic, a a guy who

understands the finance sector. >> a final point going back again to the meeting this week between the ceos and the president, a lot that's been written about the somewhat acrimonious relationship between wall street now and the president, what happens in 2016? is this a wall street that will ultimately get behind hillary clinton, for example, with reports of warren buffett contributing to her pac at this point? will they move to the other side of the boat entirely and support the republican candidate, whether it's a bush or a christie? >> i think you're going to have a lot of the business community support secretary clinton if she decides to run. certainly, wall street, if we are talking about the new environment, six out of ten are democrats. you know, maybe three out of ten are republicans and they fight for that last 10% of independents. i think they will sway toward the secretary, my guess is she will get a disproportionate of the wall street and business community vote. i mean, they liked her husband a lot. they liked her when she was senator here. so, i think you will see a big outpouring, but you know, it all depends which of the one of 20

people run on the republican side. you know, there's a lot of respect still for governor romney and jeb bush and others. so it's to be termed. >> and we are out of time. just give people the website where if they want to hear more over dinner at rao's, they can go >> if you go to rfk center, okay, wither having our upcoming auction and i am hosting a dinner, okay, at rao's with robert de niro at the rfk center.org. >> perfect. robert wolf, great. thank you. one hit and one miss, the scorecard on today's earnings from td bank, saw an 8% increase in earnings yet missed most analyst expectations. up next, we will talk to the new ceo of td bank. and later, hold the pickle, hold the lettuce, your hourly pay is what upsets us. fast food workers want to have it their way with a pay hike to $15 an hour. they are taking to the streets today across the country to make the point. we want to know if you think they should make $15 an hour. our poll now open,

cnbc.com/vote. get to it. we are become after this. we are back after this. you

td bank postinging an 8% increase in the results, the bank did miss analyst expectation and word of more challenges ahead. that hit the stock, down about 5% today. so, what's behind all of this? in a cnbc exclusive for the first time on cnbc, i'm now joined by new td bank ceo, bar

rat miserableny. thank you for being here. welcome. >> thanks for having me. wonderful to be here. >> the reins are getting passed to you at td bank from ed clerk at a time when canada is facing challenges related to the drop in oil prices and questions about the impact longer term on the kmez. are we see the beginnings of a downturn here? >> without a doubt, the commodity price boom appears to be over. what you see in the oil price market is having an impact today, for example, the toronto stock exchange is going through some major, you know, buyoffs because of that. balance you would expect this when oil starts to drift downwards the way it has. not surprising from that perspective. >> i wonder if you can share some of the ways it is impacting the canadian economy if, in fact, that's why the results are softer. >> we are an oil exporting country, as you know.

certain parts of our country go through a weak spot here, other pars, ontario and quebec should benefit with lower energy prices, lower gas prices. a balanced story in canada, overall, on balance if prices go any further down, certainly is a negative impact on canada. >> what about for the u.s., where people think the opposite that the customer, retail client you are dealing with should largely benefit, where's your -- where are you in the u.s. in terms of your branches and those locations in areas where people are benefits or are they also in areas that might be hurt by the drop in the oil price? >> i think generally the wisdom would suggest that lower oil prices like a tax cut, people instantly get money in their pockets and spend the money and 70% of the u.s. economy is consumer driven, so you would think that there would be a positive impact and see some of that already. i think the story here is sometimes we miss is that this is also a story about global

weakness not a good side of the story, depends were they settle in, overall, i think this is good for the u.s. economy, at least over the next little while. we are well placed, wither in the northeast, in florida we have more than 1300 location on the eastern seaboard, new york city a key area for us, we got more than 120 locations now. in the five boroughs, the fundamentals are stronger and should only help td bank. >> we see them all over the place. i wonder how that hits in with what is your vision for the near term for this company now that you are at the helm? >> a growth company, u.s. is key part of our strategy. we had zero location seven or eight years ago, today, a major player, best markets right across the eastern seaboard and the growth market for us. you will see more stores, hopefully you have an account with us as well, kelly.

sea more stores next year, right thing for td and customers love the bank, provide ledger dean experiences it is the right strategy for us. >> well, we want to thank you so much for being here. td bank ceo, bar rat mass ranee taking over, as mentioned a difficult time. good luck and thank you very much. >> thanks. thanks for having me. >> and we are gonna send it out now to our dominic chu for a quick earnings alert. hi, dom. >> hi, kelly. watching shares of smith & wesson in the afterhours, the gunmaker posting better-than-expected second quarter result bus gross margins fell to 32% from over 42% the same time last year, the company says sales dropped 22% on lower consumer demand but that the decline was expected. investors not expecting the drop to a certain degrees, stock just reopened for trading, down as much as 12, 13%, now down, you can see there, about 4% on 52,000 shares of volume, kelly, back to you gays. >> all right, dom, thank you.

$8.74 an hour. that's the average pay for workers at burger king, kfc, dunkin' donuts and other fast food chains. today, they are taking to the streets to call for a raise to $15 an hour. up next, we will discuss the implications of such a move and we want your opinion on the raise. go to cnbc.com/vote rate now to tell us what you think. we are back in two. touild some. ♪ some come here to build something stronger. others come to build something faster... something safer... something greener. something the whole world can share. people come to boeing to do many different things. but it's always about the very thing we do best. ♪ but it's always about the very thing we do best. in a we believe outshining the competition tomorrow quires challenging your business inside and out today. at cognizant, we help forward-looking companies run better

and run different - to give your customers every reason to keep looking for you. so if you're ready to see opportunities and see them through, we say: let's get to work. because the future belongs to those who challenge the present.

welcome back. tag food workers protesting today in new york city and around the country, coming together and calling for as 15 minimum wagesome that what they ought to make? he will it us what you think at cnbc.com/vote. joining me is kendall fells, national organizing director at fast food forward, he spores the workers, here with the panel. welcome. >> thank you for having me. >> you came from your protest outside city hall? >> that's correct here in new york city the protests began in november of 2012, you know, we're at the two-year anniversary here, started out with 200 workers from 30 stores and new york city, you know, brave enough to say they deserve $15 in a union. two years later, we are at 190 cities across the u.s. and i would say things are going full swing and looks like these workers are gonna win this campaign. >> what do they need to win? do they need this to be legislated or their employers to get behind them?

>> what they need is these workers are target the actual corporatis corporations, talking about mcdonald's the corporation, say mcdonald's needs come to the table and narnt with them at a national or international able tore $15 an hour an hour wage ad union contracts so they can deal with working conditions. >> kendall, i got to tell you something. 52% of fast food workers are getting some kind of public assistance. so we do not have people making a living wage. if henry ford came out of the grave and walked here today, he said if you cannot make a living wage working for a place, and you can't buy the products that you're getting paid to produce, you have a problem. that's about $7 billion of subsidy. that's everybody paying that subsidy. i would much rather have that subsidy go to the people who buy the product rather than having all of us paying the subsidy. that was a shocking number when i learned that. 52% of fast food workers are on s.n.a.p. or a program like medicaid. >> that's exactly right. when you look at the fast food workers, a lot of them are working multiple jobs, and they're still on state assistance.

a lot are working two jobs and three jobs just to figure out how to keep rent, food in their mouths and clothes on their back. "the new york times" just did an article today on one of our leaders, terrance wise. and he talked about how he had two jobs. and he still ended up getting evicted from his apartment with his three daughters and fiancee and was homeless for three months. >> what do you say to people who say we acknowledge that certainly people are not paid enough to make a living in these jobs. minimum wage ought to go up. all these other measures that you might expect people to advocate. but that essentially, a 2/3 raise on average seems like a kind of a big leap to $15 an hour. and a lot of franchisees say the economics don't work for us if we own the store. >> i think we have to make a distinction between this campaign and raising the minimum wage. >> right thinking campaign is about the corporations coming to the table to negotiate with these workers, the fast food workers. and affect of this campaign has been politicians getting behind these workers to raise minimum wage like in seattle to $15, and san francisco to $15. and chicago to $13. now they're debating in los

angeles, 13 or 15. and when you're talking about the franchisee and franchisor system, mcdonald's and the other fast food corporations have made a living off of making the argument that franchise owners are independent owners. but when you get into the details of the situation, the corporation actually manages the store from the top with the authority where they can be named as an employer, which the general counselor of the national labor relations board said earlier this year. >> kendall, a lot of these companies that you're talk about, mcdonald's as a prime example, are having major issues on their own with people not buying their product as much as they used to. issues with maybe menu sprawl, people going to higher end restaurants, fast casual as opposed to fast food. are those two things linked in any way? i get the sense that maybe the folks at chipotle make a little more on average than the people at mcdonald's do. and apparently a lot of people are willing to pay that. >> yeah, when this campaign began, mcdonald's was one of the most loved brands in the

country. now they're one of the most hated brands in the country. and i would say a lot of that has to do with the fact that $7 billion in taxpayer money is being used to subsidize these workers with the fact that 8 out of 10 fast food workers are having their wages actually stolen by their employers. not only are they making minimum wage, employers are stealing their money multiple ways. americans are fed up with footling the bill for a $200 billion industry. mcdonald's made close to $6 billion in profit last year. you look at the top seven fast food companies, they made over $7 billion in profit in 2012. that's after they pay out their bills, they're putting that in their pocket. the same year $7 billion of taxpayers' money is being used to subsidize their workers. and i think people are fed up with it. >> i was going to say before we let you go, my grandfather will sometimes when we debate this at home will say well, look, aren't these often entry level jobs in the whole point about the kroger's ceo, you get people started out working. they're not necessarily making a career out of this. so if we're trying to legislate for people who are down the road

raising families, et cetera, we're kind of missing the point for a wide swath of the people who are working there. >> you know, 2008, when the recession hit we lost a lot of jobs. the jobs that have replaced those jobs are low wage jobs. the fastest growing industries are the low-wage industry. the fast food industry is one of the fastest growing industries in the country and also the lowest paying industry in the country. tease are the jobs of the future. if we don't make these jobs livable jobs where people have dignity and working conditions that are -- that make sense for working class people, then we're going to build a country that i don't think any of us actually want to live in. >> kendall fells, national organizing director from the fast food coalition you have done a lot of work over the past several years. our polls suggest you still have work to do, by the way. about a third of people say fast food workers $15 an hour is a good move. 2/3 still opposed to it. as you know better than anyone, your work is cut out. but thank you so much for being here. >> thank you so much for having us. >> really appreciate it. coming up, we're going look ahead to tomorrow's employment reports speaking of jobs and wages. and tomorrow tune in to "closing

bell." starbucks ceo howard schultz. we get a look at starbucks' new roasting and tasting rooms about to open around the world. howard schultz tomorrow. we're back after this.

welcome back. time now for some final thoughts

with the panel. looking forward to the jobs tomorrow, your best guest? >> somewhere around 230. i don't think there are any surprises here. adp, which i used to call another dumb prediction actually has been getting it right this year. i think we're going to see around 230. no surprises. unemployment at 5.8. for everybody who starts to get a job, there is somebody who didn't have a job for the last two years who coming in the market. >> what are you watching for, john? >> i am watching what happens in enterprise over the next few weeks. we're kind of in this period that tends to be slow right before the holidays. a lot of companies have workers who are off, but we're also seeing a lot of releases, a few acquisitions happen during this period. and with valuations being where they are, i wouldn't be surprised if there are more. >> mike? >> the dollar reaction to the jobs number. people's eyes are getting big. anything less than 250, the dollar maybe gets smacked. you have an unwind of some of the trades recently. >> that by the way is still the story. both on the oil front and natural gas today, people haven't even focused in enough on the weakness in natural gas as well for a lot of these

majors like the exxons of the world who have as much exposure there as they do on the oil side. and i will point out there are plenty of reports circulating about the fact that the oil price right now isn't even represented by the wti price that we're quoting that in parts of the bakken, the oil is going already closer to $50 a barrel. it feels as if we haven't gotten near close enough to figure out where this goes. >> in oklahoma, that's a result of a loss. >> exactly. >> oil can create enough political instability in iran and russia to make gold move, then i'm giving up on gold. it would be the undependable friend that never shows up. if we don't have inflation, if we don't wind up with political instability, as far as i'm concerned, gold can leave the building. >> gold, the 6,000 year bubble that he i guess is call tending of as well. thank you very much for being here. really appreciate hit the afternoon. "fast money" is coming up in just a few moments. now with melissa lee and the gang, hi, melissa, what is on tap? >> falling oil prices have been great for the airline trade as a whole.

the xal up 30 something percent so far this year. but we have one analyst coming on saying that low oil price mace not be as good as you think for airlines. there could be a cautionary tale around the corner. >> we had hawaiian ayrton show talk about a near vertical move in their stock price, melissa, since that oil price collapsed. and as we just mentioned, it may not be done yet. >> it may not be done. but the question is what do they do with all this extra money. >> yeah. >> do they spend it before like drunken sailors or maintain their dislynn? >> great point. >> "fast money" starts right now. live from the market site in new york city's times square, i'm melissa lee. your traders are dan nathan, karen finerman, and guy adami. we're talking to elon musk. tesla and solar city both getting hit in the wake of falling oil prices. but do the moves make sense, or are these buying opportunities? we will debate it and talk to the ceo of solar city, musk's cuss son,