>> got to leave it there. jonathan, fascinating stuff as always. thank you. >> thanks. >> 87% of the time. >> yeah. 87% of the time. thank you very much. >> almost all the percent. >> not quite. it's 87% of the time. thank you for watching "street signs." you are off for the next couple of days. well-deserved break. >> thank you. >> see you monday. "closing bell" is next. and welcome to "the closing bell." i'm kelly evans at the new york stock exchange. >> i'm bill griffeth. after losing nearly 500 points on monday and tuesday we get a bounce in the u.s. markets, not only for equities but oil, wti bounced a little bit today. >> a couple of factors contributing to the rebound in the market today. >> minutes were what we would expect but you had decent jobs number this morning from the adp. and the retail sales, some of them pretty good.

jcpenney especially. that stock is very strong today on better than expected holiday sales. >> we certainly are. we have had a down couple of days for the market and set up perhaps for a spring back and surprising to see the resilience today, not more of a flight to safety bid after the tragic shootings in paris this morning and, in fact on that note as we keep an eye on that horrible terrorist attack on the magazine that previously ran the cartoons of mohammed the president and much of the world condemning the barbaric murders. we'll get you the latest as the attackers are at large. >> at this hour i think pictures out of france a vigil is taking place. hundreds of thousands of french people citizens are in various squares in paris and elsewhere to mourn the loss of those lives today. >> yes. and what they're holding i believe there are signs saying we are charlie referring the magazine attacked. >> i know that you know we are

the business channel. i should mention it was interesting to note that the french stock market did not fall on this news. the part of the european markets higher today, finished up and this time thinking more about the human element than anything else. >> we heard from french hollande there's a day of mourning tomorrow as the grief shared around the world and final hour of trading on what's happening looking to close, the dow up about 180. strong session today following a couple of very weak ones to start off the year. that's still the talk of the floor. >> s&p nasdaq also up 1% as we go into this final hour of trading today. get to the closing bell exchange lindsey piegi and jack and keith fitzgerald and we've got steve liesman and rick santelli to talk about things. steve, give us a play by play on the fed minutes. you know not a lot of

surprises. we knew what came out of that meeting in the press conference. right? >> they're talking about global economic weakness. they're talking about the affects of lower oil prices. but overall, what they see is that the u.s. economy is able to withstand that some seeing risk to the up with side. maybe a touch aukish with one comment that the fed could raise rates at the current core pce level and they qualify that saying they would have to see movement towards a goal of 2%. overall, you know i'm more focused today than on the minutes with the data of adp number at 240. small business hiring at a record since 2006. and finally, that trade deficit number guys showing the effects of lower oil prices on the u.s. economy, that's a boost to gdp. our cnbc rapid update up by 0.4% and looking at a 3% or 3.2% fourth quarter growth and this

is a quarter that a lot of people thought down in the low 2s. >> especially following that 5% bounce. >> exactly. >> tell us what you think the fed is going to do here and thatwhat they should do. >> the vast majority of committee members saw new language as a path that it would not occur for a several meetings and they talk about the risk of fed forecast for growth and inflation being to the downside and very likely that again, that pathway to normalization does not occur until well beyond mid-2015. possibly in 2016 as we have maintained for quite sometime. and i think in the end the fed remains data dependent as they always have. if the data comes in under expectations they're very happy to extend that time line. >> you know i just want to put out there that i think the comment on the core may be took off the notion they wouldn't raise in 2015. if they're okay with the core that was a big argument why the

fed may not hike this year. i think it takes it a bit off the table. >> with the expectations -- go ahead. >> as you said they also qualify that with they had to be confident in their expectations for inflation reversing course back towards 2% so if we do continue to see downward pressure, that certainly will take rate increases off the table. >> even with the expectations of greater growth from the fed's staff in that meeting, we've had this rough start to the beginning of the year. keith, you think this selling is logical. what do you mean? >> well i think it is very natural for traders to want to take some money off the table. logic of big portfolios to rebalance and logical to take some protective action against an uncertain backdrop. but to me it was overdone i think a knee-jerk reaction and everybody's ready to get back to work. the key takeaway the markets didn't drop on the horrific events in paris and says to me

the psyche of the markets is stronger than terrorists want to believe and that's a great testimony to faith of capitalism. >> talk about the faith in a strong outlook after the weak tart to the year. since the minutes are a couple of weeks old and seen market inflation expectations drop precipitously again that we should take these as an indicate indicating where the fed stands now, as well? >> well you know it's not only that but think about this, kelly. we know that the oil producing stocks and those that are related to crude suffer. what we don't know is ancillary affect of the low oil prices and we saw with the retailers today and all of that is playing into what's happening with the fed and one of the things i took away today is they said it's unlikely to move before april. now, unlikely and, steve, i'll go back to you with that term. unlikely is very vague word for

me. if the numbers start to heat and today's numbers were hot, if we start to see real good solid numbers, then i've got a feeling that the fed has their hands tied and move quicker than people think. >> i don't think that's right. unlikely is probably the best guess. 70%, 80% probability. you're missing an important number and that's wage inflation. you don't have it. we're not seeing it. plus to the extent of overseas economies affecting the united states, so far it appears to be through lower inflation, that stronger dollar lower oil prices lower overseas growth perhaps taking an edge off export growth in the united states and -- >> all of that if you think about it is a bullish foundation. you couple it drn. >> i agree. i agree. >> couple everything you said -- >> not an inflationary foundation. >> let's raise a quick question. hang on a second. been on my mind. curious what you think about this. we had jimmy keenan on the show

yesterday. the more they say whether it's credit or the real effect we're talking about a 2016 and beyond kind of event. so quhas the fed supposed to do if there's this sense again because it's dropped so sharply that it takes a while for us to feel the feel effects of the decline on the oil patch and those parts of the credit. >> bringing rick in on this? go ahead, keith. >> i actually don't think it's a negative because i think the average american consumer finally got a very real tax cut in the pocket -- >> no keith. i understand. do you think that that's still strong -- so the initial -- that boost is going to be strongest right away when everyone's excited about $1.99 gas and then next 18 to 24 months parts of the oil patch really come off and oil doesn't rebound, what do you do if you're the fed and worried about that potential outcome? >> i think you sit back and let the market sort things out, which is completely abnormal -- >> that's the last couple of

days. >> yeah. exactly. the fed doesn't want to do that. it doesn't know what to do if it has to sit back and relax. but i think that the cumulative effect takes a process in tw or three quarters from now. that similar plus feeds into companies and earnings and stock prices ss and i think the market adapts and drive forward off of this. >> rick? >> you are waiting for us to tap you. let's bring in santelli. we have given you a lot to address here. pick your spots here. where do you agree or disagree right now? >> well i read the text and to me it's still mostly gobbledy goop and having a debate on whether the fed raises rates or not is a crazy discussion. rates are too low. no matter the outcome of oil. in the end, there's only one question to be asking. if steve thinks that the problem with the economy is we aren't getting wages to move up i want the know why another year of 0

interest rate policy makes a difference. or another two years or why is it going to bring some areas of the globe like europe with as high as 12% or 13%, why is qe american style going to bring that down? none of it seems to add up. i will have a discussion of what's going on with interest rates. yesterday, we came very close to that october 15th 1.86 intraday low and the markets are different today. i think we have a cycle of the equities to get the sea legs back a bit and start playing the range now probably between the mid 180s and 205 in terms of rates. i don't think see anything changing dramatically at all. >> rick? with all due respect, there's a notion inside what you're saying that somehow you know better than the market knows. >> no. no but the fed doesn't! the fed doesn't. >> okay. but hang on. >> one at a time. >> they don't know what they're doing. >> the fed ended quantitative

easing and signaled the next move is up. >> how much good did the last couple of batches do? >> hold on rick n. that time frame. >> no! >> the markets by themselves have moved down. so when you say rates are too low, rates are too low relative to what? relative to what you think? >> relative to the fact they've been tinkered with at. how do you know where they would be? >> agreed. agreed. agreed. >> then what are we talking about? somebody mentioned this is good for capitalism! please any country that's a capitalist raise their hand. gee, don't see any. >> hang on a second. rick, remember we have had this discussion before and we have -- listen. listen. i'm with you. i get it. guys, we have the long end of the curve to look at. far less if you will manipulated if you will. it's a big market of u.s. treasuries. >> that's right, kelly. >> you can't argue that on the one hand the moves matter and they don't. if we have material information from the last couple of months

especially expressed in the long end, rick what is that telling us? >> what material information? >> ratds have moved down significantly. >> and why have rates moved down here? >> that's what we're saying to you? >> they have moved down for a different reason rick! >> they moved down because traders -- >> that's right. >> rick, rick you hit the nail on the head. they're going down because of europe. >> that's it exactly. >> you can't say it's all the fed and europe, that's my point. one or the other. >> $17 trillion economy an you let the academics with a meeting every 6 1/2 weeks think they're experts on everything from energy to what kind of products our mortgages should be? and you think that i'm the one who doesn't make sense? >> no. but what they're -- >> hang on. >> setting the policy rate. >> hang on. >> what they're trying to do. it's not -- >> then we need to find a different group of people to make different policy. >> why? rates should be higher?

based on what rick? not based on the market. >> rates should be -- >> how can you say that? >> listen. let me get you in here as well. lindsay, would you argue there's real genuine price discovery happening in the long end of the u.s. treasury yield curve if you will pressed by whether it's players in europe or hedge funds or whomever and not just manipulation by the fed? >> i think it would be impossible to argue it's solely manipulation by the fed but in part -- >> i never said solely. >> look at all the programs that the fed put in play and they definitely have had a hand but to say the fed is 100% responsible for the level of rates i think that's a difficult argument to make. >> rick, let's bring it this way. we have to go. >> so arguing degrees now and awfully cold in chicago. >> implied in kelly's question is if yields are going down on the long end of the curve even as the fed talks about raising the short rates, implied in the question is are the long yields

guessing a slowdown in the economy if the fed starts to raise rates prematurely? >> i don't know any other possible conclusion to draw. >> exactly. >> i would draw a different one, bill. >> wrong wrong, wrong. >> that's keeping people out of the market. >> the market saying that inflation will be lower. >> keep going on -- >> wait a minute. wait a minute. >> we have to go guys. >> you're missing the fundamental point here. >> okay okay. we are yelled at in our ears. >> so what? we are yelled at here by me. >> i was going to say try having about seven right now. thank you so much everybody. this afternoon, a big day here for the market. a lot to talk about, obviously. we have still got 45 minutes to go. still gains of about 1% across the major averages. much more ahead on the rally and whether this is a head fake or a start of a bull market for 2015. also coming up discovery communications david zaslav from

las vegas and how he plans to steer discovery through the storm of disruption in the media landscape. stay tuned.

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last few weeks, you wonder whether, you know, the question is is this a one-day wonder or a beginning of a new trend? the dow up 173 points or 1%. the s&p and the nasdaq up like a mountain at this hour and day two of the international consumer electronics show in las vegas and not just about gadgets, by the way. >> julia boorstin joins us now with david zaslav. >> thank you for joining us. >> thank you for having me. >> you announced the final renegotiation with the cable companies is done for the year. >> right. >> and i know there's a lot of pressure with the number of cable subscribers flat to down and pressure to increase the rates you're getting. how did it get? >> we were able to do really well, a number of deals up and

part of it is because the viewership of our channel is up over the years so five years ago we were about 5% of the viewership on cable. now we're about 11% with channels like own and i.d. and discovery, tlc, animal planet and a very good story to the distributors that more people spending more time with our channels and we have spent more money on content and we were able to get better than double digit increases. which will be very helpful to us particularly because we're seeing significant growth outside the u.s. in terms of subscribers and viewership. but inside the u.s., it's relatively flat and the growth has to come from either pricing or really outperforming the market with the channels. >> better than double digit. what's that mean 15%? >> better than double digit. 10%, 11%, 12%. nice increases on the subscriber fees. not all of the deals were up. this year you know every year they're somewhere in the range of 20%, 25% are up.

>> here everyone is talking about the new over the top direct to consumer services. dish announced on monday. we have hbo, showtime direct to consumer. you have some offerings overseas. are you going to launch one here in the u.s.? >> overseas we actually have a really interesting product. we have a sports channel in europe called euro sport which is 130 million homes and bigger than espn and eastern and western europe and we offer a direct to consumer product for $7 a month and started a few months ago and going great and so that's a little bit unusual because since we're in 55 countries, there's not one distributor for all of europe and able to offer actually euro sport directly to your phone and what we're finding is it's not changing the way people watch euro sport. the viewership is growing. but we're able to establish a direct relationship with economics with consumer who is on the go want to watch tour de

france or tennis. >> not cannibalizing the service, why not do it here in the u.s. with the discovery networks? >> it is trickier here in the u.s. we're working with the distributors. one thing showtime and hbo will do is not really directly with the consumers but working with distributors to do it and charlie announced with espn is for people that don't have cable. trying to get the people that haven't subscribed to cable but only have broadband and want some video so i think outside of the u.s. it is actually more progressive. in northern europe in norway denmark, sweden and finland, we have large broadcast and cable assets and in those markets we are going directly to consumers also. you are seeing a hodgepodge. here i don't think it's going to have a significant impact because the ecosystem of the cable operators and directv and traditional distributors is where the majority of viewing still happening, at least for the next few years. >> interesting. bill? >> how are you doing, david? are you getting everything you want out of the oprah network?

it's four years old now. this month, as a matter of fact. you're finally getting some traction among women aged 25 to 54. so it's a niche play right now. face it. this is about oprah and you had high expectations when you launched this network. you know are you wanted to be at this point? >> first, it's great to see you, bill. >> nice to see you, david. >> funny you should ask because own is doing terrific. last night was tyler perry's program "the haves and have notes" and it was number one on cable and beat the other cable networks and most of the broadcasters with a three rating in the demo. in the aggregate, own is now a top 20 network in america. oprah is on the network and she's really having a huge impact. we also have oprah.com which is doing very well. but most importantly, we were able to get very good subscriber

fees from distributors approaching 90 million homes and the network is very profitable. and in a world where people are looking for content, a little bit differently, we have real super fans of oprah now on own and a big, big advantage. so the network is doing fantastic. it started four years ago. oprah and i made a lot of mistakes. we have to figure out who the audience was and how to reach them. today we have a terrific asset. it's also working well online where oprah is doing classes directly to consumers. >> david it is kelly evans here. a quick question on that. you mentioned online. people are entering and writing today to say maybe the digital streaming space or the top whatever you call it is luke rative. what can you tell us about what advertisers are willing to pay over the top versus traditional cable? >> well traditional tv that is still the best value for advertisers. there's no question that advertisers are starting to

experiment in some of the other platforms and we are there with those platforms. we have a business of rev 3 reaching half a billion users a month of streaming video so stream video when you look at youtube doing, as you aggregate it up it's a meaningful market. in terms of influencing consumers and dollars they're coming in a meaningful way on cable. in fact, we're seeing and it's early, we are only in the -- going into the second week of january, but advertising is a little bit better. it was slow in the fourth quarter but advertising at least in the pricing is always good but the volume was slowing down a little bit in the fourth quarter. we are seeing increased volumes so far in this quarter. >> but there's a lot of reason why volume was down and pricing relatively soft in the third and fourth quarter of last year is because of digital. advertisers shifting into digital and sort of seeing that as a real alternative. are you concerned about that

being an issue? >> i think the answer is we don't know. the pricing actually to be clear is quite good. the pricing was up you know in scatter between 10% and 15% which was good. the volume wasn't there. we're seeing more volume now. the question is, why wasn't the volume there? were people holding dollars for performance? some companies holding dollars for performance for year end or shifting to digital? experimenting and finding success or not finding success? we will have to wait and see. out of the box in january, the volume looks better. >> quickly, david, you know i can't believe we have gone this long without acknowledging you grew up in the nbc family and a big part of the -- >> proud. >> back in the day. we were all talking at that time about distribution and how the explosion of distribution channels and now worse. give me a sense of five years from now hoe we're all watching discovery, all of your channels. i mean is it easier for you to

find all of your audience through mobile or would you rather have it in a traditional fashion the way it is right now? >> well, you know the traditional model is very effective and i think it's going to continue, no question over the next you know over the next several years and people have alternatives and still watch the tv set in their home and watching more tv particularly outside the u.s. where they're watching more tv than they ever have. but we own all of our content. we have 14 channels here in the u.s. on average, 11 channels in 230 countries and so for us the fact that we have strong brands super fans for each of the channels and own the content sets us up. i think we have a big differentiator. we're the largest paid tv media company outside of the u.s. we make more money than anyone else in paid tv outside the u.s. we have more channels than anyone else. the fact that we have on average 10 or 11 channels in every country around the world gives

us a real advantage because many of those markets like mexico brazil argentina where i was last week or europe in europe we have 11 channels and there's only on average 50 channels and many of the markets will be a nice hedge for us because on a developmental basis they look a lot like what the business looked like hanging out together at cnbc years ago. >> i have to ask about your stock price, though. the stock down from the 52-week highs. off 25% over 12 months. what will it take to turn that around? >> for us, we're focusing on the long term. so we've acquired euro sport. largest sports player in eastern and western europe. we have launched more channels across the world. we launched in 230 markets between 2 and 3 channels in the last 3 years so we're investing a lot more. we were investing $500 million in content. this year we'll invest over $2 billion.

and for us that's where developing real long-term value. the market share around the world has tripled. we made about 10% of our ebitda outside the u.s. we're now over 40 and a few years we think we'll be maybe over 60. i think we are investing in owning more content, more ip more channels for long-term growth and you see it in the international business growing almost 20% on average over the last three to four years. >> certainly a real international growth story. thank you so much. unfortunately, we have to go. appreciate you joining us. >> thank you. >> thank you so much. >> thanks. see you later. whatever ebitda is. >> earnings. >> we don't use that very often. i know that. >> i know you know but i was saying as an underlying thing for the people who might have been thinking we're here to help. >> we'll explain it to you. 30 minutes to go. the dow up 180 points right now. been a good strong day. we know that. the question is what will happen tomorrow and the day

after? is it beginning of a new trend or not? up next how a mid cap fund manager is outperforming the benchmark. plus billionaire hedge fund manager bill aikman sounding off on jcpenney this morning. >> it was a dying company and unfortunately today continuing to be a dying company. >> dying company and continues to be so he says. so why is the stock up 20% today? the pros debate whether or not he is right about the struggling retailer or if it's a stock perhaps that you need to own. that's coming up. stay tuned.

welcome back. dominic chu is watching the big movers. >> bill, kelly, start here with with janus capital, the home of bill pimco. upgraded the holding company to an overweight from an underweight citing improvements in performance among other things. shares up. alkermes gaining ground after effectiveness of a drug. arena, as well surging on positive data on one of the treatments for autoimmune diseases and here we go. you can see up by 77% and also going to wednesday the home builders news on that president obama set to announce at least reduction on fha mortgage

insurance premiums. see homebuilders to the upside. different story for mortgage insurers and may be more negatively impacted. down on the day, as well. back over to you guys. >> thank you for now. turning to our first beat the street segment of 2015 mid cap mania and now a few shining stars could be big winners for the portfolio. nicholas fund is beating the benchmark up about 9% in the period. >> joining sus the nicholas fund's portfolio manager, david nicholas nicholas. happy new year. thank you for joining us. >> thank you. thank you for having me. >> why mid cap? i asked this before. large cap i get. you often get an international exposure. and these are mature company that is will pay a dividend. small cap where the growth is. where jobs are created. why mid cap? >> well bill i think the mid cap sector you get a combination of both. security with company that is

are big enough to compete without some of the risk that is the small caps bring. you know, with not having a substantial business yet so i think those companies tend to be able to grow but also not be as volatile, if you will as some of the small cap stocks. >> right. >> david, here mentioned some of the top holds in the health care arena. tell us what they are and sticking by health care for 2015 or seeing other opportunities. >> we are more of a stock picker and that's important. we like gilead sciences which i know you have talked a lot about on your network. >> right. >> we think they have -- it's about ten times earnings and great cash flow and i think they'll have the ability to continuously reinvent themselves so they got great momentum right now and we think that will continue. we also like a company called valiant. this was the one that was

involved in the merger with allergan and we like it a lot. it's, again, a well-managed company with great opportunities both organically and i think they'll continue to look for acquisitions. >> very quickly, yeah. let me just ask you this. if the fed raises rates, if the economy started to pick up enough that the fed raises rates, what impact does that have on an average mid cap stock here? >> well, i think that would be positive. in particular, if the -- you know economy is improving. mid cap as i said before will continue to grow just as the small companies will grow. and the valuations there are pretty attractive. we think the mid cap space is always good spot to be. >> well we'll be watching to see which ones in particular you pick this year. david nicholas to kick off the beat the street segment this year thank you so much. >> thank you. >> love that fire out there. freezing in much of the country right now. >> some of you have an idea.

>> yes. pretty windy around these parts, too. not chilly in the market after a couple of tough sessions to kick off the year. up 182. s&p up 19 and nasdaq up almost 50. >> a story to be focused on, the gunmen at large in the deadly attack in paris earlier that killed a dozen people. we'll have the latest developments on that from france coming up. when it comes to medicare, everyone talks about what happens when you turn sixty-five. but, really, it's what you do before that counts. see, medicare doesn't cover everything. only about eighty percent of part b medical costs. the rest is on you.

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welcome back. yes, rally day hanging on to the gains, the dow up 183. was up what? 230 or something like that. >> right after those minutes. >> at the peak and the fed minutes came out. s&p up 20. nasdaq up 49. >> people carried out the deadly terror attack in paris are still at large. >> cnbc's hadley gamble is in parris the latest developments for us there. good evening hadley. >> reporter: well, essentially, what we understand is that three gunmen are still on the loose and police seem to be searching for two brothers in the paris area. we also understand that apparently anti-terror police raided at least two apartments in the paris area looking for the attackers and attack blocks from where i'm standing.

it was koord a french official a scene of carnage. 12 people left dead 11 wounded. four seriously, at least two policemen were victims of the attackers and also some of france's most dedicated political journalists, political cartoonists, used to poking fun at some of the political elite in france. they have also been poking fun at the prophet mohammed and quite clear that the attackers not taken too kindly to that. of course attacks by fundamentalists threats by muslim fundamentalists are not new here in france. people as well as terror officials have been coming out throughout the day and explaining the situation. hollande has come out saying that the terrorists are going to be brought to justice. this is the most deadly terror attack in france over the last few decades. you have to also remember that the role that france is playing in the coalition against the islamic state is one that not too many people here taking kindly to. france has a population of 5

million muslims, 1,000 we know of fighting with i.s. in syria and iraq and people here in paris rallying, thousands on the streets in solidarity with the victims of the attack and message is today we are all charlie. >> cnbc's hadley gamble there in paris, hadley thank you very much. it is a remarkable sight to see hundreds of thousands of citizens taking to the street there is in different cities around france. >> spontaneously gathering and on twitter and the website a similar image for the publication, at least. >> heading toward the close. 19 minutes left. the dow up 190 points. jcpenney shares up 20% today. is it a one-day wonder in response to the stronger than expected fourth quarter numbers? that's just next.

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businesses have already used zip recruiter and now you can use zip recruiter for free at a special site for tv viewers; go to ziprecruiter.com/offer2. this is one of the surprises today. jcpenney, we woke up this morning to decent very good holiday sales from the retailer up 3.7% over that time. and the stock has responded

accordingly to $7.89. >> the company posted the better than expected figures and earlier this morning on "squawk box" bill aikman told our colleagues on the new new york set he had little confidence still in the xen's future. >> jcpenney was a dying company at the time we invested in the company. unfortunately, today continues to be a dying company and we brought in what we believe to be the best ceo in the country in retail to change the business. execution wasn't what it needed to be and that can happen. didn't work. ultimately none of the changes happen unless the majority of the shareholders support the initiative. >> so who's got it right? ackman or folks buying jcpenney today? mark hake and greg fuhrman. welcome to you both. mark, listen you have been a

stalwart long on the name. you like the clothes. you buy them wear them. et cetera. just tell us after the surprise which some describe as a short squeeze are you still confident long term to go back to $15 range you'd spoken with us about in the past? >> yeah. yeah. i am very confident in this company. you know, in today's announcement announcement, they implied the same store sales growth was profitable and i'm expecting a significant profit and at least a very nice free cash flow number for the fourth quarter. >> okay. alex, what's wrong with mark's reasoning here? i mean he's been a bull and things are starting to look up for this company. why are you not convinced zblet. >> well you know not surprised to see the stock strong today. people shorted this stock ahead of what they thought was a guide down for the fourth quarter. ultimately, though we need to

see mid to high single store comps for a good investment here. they're already talking about low mid single digit comps here in the fourth quarter. you're going do get tough cover comparisons. i don't see it happening unless they get the sales growth. looking at the best brands going either to other retail avenues or right to the consumer through their own websites and something you have started to see the last five or six years. meanwhile, a lot of that comp growth is really focused on jcpenney's e-commerce business and you see about 10 to 20 points of basis to shift every year. >> mark, respond to that. >> you know, you're talking about a company has close to $13 billion in sales. just a slight increase in sales straight to the bottom line. operating leverage. and two years ago at the end of

2012 they had very similar fourth quarter number and they had 400 million in free cash flow so if you have two or three quarters of very profitable growth they'll be able to have their debt paid down or their book value increased and the stock's not going to stay anywhere near where it is right now. it's being priced as if it's going out of business and just simply not going to be the case. >> i wish we had more time to talk in more detail about the future of jcpenney. we'll have you both back at some point. thank you both for your thoughts on this. thanks for joining us. >> thank you both. 12 minutes to go in the close of the dow trying to make further gains here as we do so up almost 200 points. better than 1%. identical gains in percentage terms. s&p also up 1%. bob doll right about the markets in 2014 and very wrong

predicting actively managed funds to beat indexed funds. he'll tell us if he's still bullish on the market and fund managers. he is here after the bell coming up. [container door opening] ♪ what makes it an suv is what you can get into it. ♪ [container door closing] what makes it an nx is what you can get out of it. ♪ introducing the first-ever lexus nx turbo and hybrid. once you go beyond utility there's no going back.

9:30 left in the trading session moving higher. the dow up 200 a moment ago and now 196. s&p, look at the nasdaq and dow up equal amounts percentage wise right now. joining us are larry mcdonald along with bob pisani. welcome to you both. larry, i had to crash. first line of the note the u.s. dollar setding up for a sharp decline and i got to hear why. >> boy is that a counterintuitive play right now? >> think back to the fall of 2013. the dollar was getting out of hand. emerging market currencies and bonds were in flames and the fed started to talk the dollar down. the dollar went from 85 to 79 from the fall of 2013 into 2014. >> dollar index. >> yeah. getting point now in the next couple of days we have got rosengren, we have a lot of fed speak. if they mention the dollar as a concern, there's so much pent-up

bullishness in the dollar, it could create a reversal and in oil -- >> talking a correction? correction totally understand and overbought and too much strength perhaps, whatever they call it in the market. talking about more than that or no? >> a sulback is a bull market for now. if they continue that fed speak, then you'll see a more pronounced -- >> why would the dollar sell off right now? >> raise ratds. >> it makes sense. >> bach back to the same reason and bonds last year. everybody is in one side of the boat it is the most dangerous trade on earth. >> look at oil. >> bonds. short bonds at 3%. here we are under 2% a year later. oil, what i saw fascinating this week the bno etf, brent etf trading 92% below the 200 day. >> wow. >> on a technical, but that's a technical call. we are so far oversold on oil. we did a story this morning with

kencoh and five times in 30 years when oil has been sold 50% down in 6 months that's it 5 month times, 6 months, oil is up and up an average of 50%. history tells us on the technical level there's -- seeing these extremes, there's a bounceback we get. >> the catalyst could be some of the fed speak. the fed talking the dollar down. >> that's oil. we haven't had the extremes. i don't think we're there. >> the fed talking the dollar down is very good for oil. >> you understand all the skepticism people have when they hear you say the dollar is going lower. >> i understand the correction. i get that we're all set up too perfectly but for something more significantly to happen. >> the 10-year drop below 2% when the fed minutes came out. >> supposed to be hawkish. riddle me that one. >> consensus around june they pushed that away. we're data dependent.

i think trying to poo-poo this. >> i think we're getting the music. >> like we are at the oscars now. red light's going on. a quick break and come back for the closing countdown. right after the bell, are you ready to run a franchise? kate rogers has a special report on boon time for franchises and if kate's numbers line up with what kevin o'leary is seeing. >> maybe he'll make an investment. >> maybe.

a couple of minutes left in the trading session. today, rally day for the u.s. equities. right off the bat for the dow pretty good move higher here. in fact near the highs of the session with a gain of 210 points at the moment for a gain of 1.2%. also buying treasuries as bob pointed out. the yield on the 10-year back below 2%. 196 right now and trading and one more price of crude oil, kind of a mixed day. wti, though up 1%. so we saw a movement. but look how volatile crude oil has been today and back to $48.50. you think we should have an even bigger rally. >> my disappointment is oil stocks not doing much today. exxon, chevron. xop, the oil exploration production basket is down today 1%. we should be getting

dramatically oversold and a little bit -- there's the xop. people waiting to rally for three weeks now and on a day with oil stabilizing, you should have seen a move to the upside. i think that's a little bit disappointing. >> you see the dollar correcting. do you see oil coming back here? >> i see a move up in oil triggered by potentially the fed talking the dollar down. it would be a really fed move and we were just talking off and look at the xop, the oil etf, versus oil stocks oil is trading cheap to the stocks today whereas in the past say, october 15th the stocks were trading cheap to oil and same thing of gold and gold miners. right now i would play the oil versus the oil stocks for the next week. >> on a different note retailers reporting tomorrow. holiday sales, jcpenney huge story today. >> it is the week late. see what -- >> exactly the point.

see what other people are reporting tomorrow. if they have positive news big plus. >> very good. we are going out with a 200-point gain. thank you. see you later. as bob said retail sales reports tomorrow and market moving and we'll get ready for the big jobs report on friday. stay tuned now. hour number two of "the closing bell" with kelly evans. see you tomorrow. thank you, bill. welcome to "the closing bell," everybody. i'm kelly evans. we have a green day this week on wall street. here's how we're finishing up the day. the dow going without a gain of 1.2% or 210 points. s&p up 23. nasdaq adding 57. gains of about 1 1/4 for each of the indexes and saw momentum pick up into the close. let's get to it with the panel. joining me is lee gallagher, stephanie link and kayla

tausche. there are people that turn on the televisions or look at market saying really after the shocking events of paris this morning? are you surprised at the resilience today? >> no i think we are a bit oversold heading into today to begin with and then the fed told us what we have been saying far listening time the economy is getting better. that lower oil prices are good for the economy. and that interest rates probably staying pretty low for the next several meetings and starting to tightening, it's gradual and data dependent. all of this means good things for the economy, the consumer and for earnings. and i think that's what's going on here. in addition, low interest rates very positive for stocks. right? and again, for the economy. i think there's a lot to be encouraged about. >> we did see stocks kayla, high of the session and then came back a little bit bouncing around. is that the focus the minutes or because they're a couple of weeks old is it other drivers in the market from here? >> i think investors like whad

they saw in the minutes. the fed is committed to doing what the market needs and also reaffirmed underlying confidence in the direction that the economy is moving in but also patience at the same time with the way that they're adjusting monitor policy to counter that. you think about some of the retail numbers we saw this morning. that's really providing a bid under the market and investors say they're stopping to focus on the past minutes and december data that was negative and now going into 2015 when's happening ahead? earnings season next week and some of the consumers effects and retail sales starting to trickle through. >> a question for everybody. if you like the jcpenney numbers and the story there and is it the only game in town? only stock whose expectations low enough and the bar the clear or other names to buy and look attractive here and going to work? >> i think it is hard to predict. today we saw consumer names do really well and i think all of

the indicators that they talked about are going to push forward everything. i mean, those are macro numbers and a jobs number on friday and i think there's anticipation built into that. last month was the best we have had so far. and we're seeing wage growth now and that's likely to grow further when the labor market under a tighter labor market conditions so i think everything is looking really good except for oil. >> kelly, i mean in terms of the jcpenney reaction 30% of the flow short. >> that's a 20% move. >> look at the stock last year. practically at the low. very low expectations. analysts lowered the ratings in december. cutting numbers across the board. that said, going to jcpenney they're going to macy's and nordstrom. >> not going to wet seal. >> exactly. >> 3.5%. the entire sector up. and even under armour. >> nordstrom rallies on the jcpenney numbers?

>> just in general. but look at the auto numbers. >> weaker than expected. >> come on. >> they are. you can't get better than 17 million. why is ford at $10? i don't understand this. >> ford has their own issues and product mix issues and gm with issues last year. but you're talking about a 19% growth rate at gm's december auto sales. that's phenomenal. >> yeah. >> 20% at chrysler. ford has their own problems but those numbers very strong and then finally look at housing today. those stocks i know they were up with the mortgage changes. >> right. >> however they have been acting better and beneficiary of lower interest rates. >> and a view from brian kelly joining the fray you. what are you buying today? >> stephanie mentioned the housing names and really interesting and might think that the fha news is a little bit but housing is so big an such a huge part of the economy that to me that's starting to say if the government is once again going to support the housing market then those names could rip

particularly with lower interest rates and the fmoc minutes matter, not three weeks ago but the state we are in now. they talked about inflation expectations needing to go back to 2%. since the meeting, inflation expectations have continued to fall. that says to me the fed's going to start talking down the dollar. you need to start preparing for a weaker dollar here. >> that's what larry mcdonald told us. >> great minds think alike, kelly. >> okay. hold that thought for a second because we want to incorporate the themes with the next guest bringing us his predictions for 2015. bob doll, chief equity strategist. welcome. >> thank you. >> what is your view, first housing and then the dollar next year. this year. it's already 2015. >> housing's important. but that's the early cycle. it is not going to make or break us if it's okay and it will believe. the dollar that's a big story. the mirror of oil.

no question about it. hard for me to see the dollar not rising. compared to the euro stronger growth here. weaker growth there. fed beginning to tighten. ecb needing to weaken. perfect recipe for euro down dollar up. >> brian, what makes the dollar fall substantially from here? >> well so listen. i'm looking at a second half of the year dollar rally. right now, one, number one poxing. everybody is in this long dollar trade. i think cab drivers are telling me to get long dollar at this point in time. okay? number two, when you have positioning like that and you have falling inflation expectations here, that's a reason to get out. bob mentioned that you know europe is going to be easing a. lot of that is priced in. potentially they do. what's going to happen when europe eases? everybody's going to rush into european assets and what do you need to buy them with? a xwru ro you yochlt sell the dollars. buy the euros and then europe ran assets. >> before you respond, bob, give us some of what you would call

contrarian predictions. >> the u.s. will contribute more to global gdp than china. that's an important one. i think equity much pull funds see inflows this year. as active managers have a shot in a more selective environment doing somewhat better. >> so the u.s. growing more than or contributing more than china. does that mean that china really falls or does that mean that u.s. actually really rises? more to expectations? >> some of both. if the u.s. can grow three real almost five nominal, that's enough to put the increment higher than china and clearly slowing. not a basket case but has to do less investing and work on consumption and that's a multi-year process an doesn't happen overnight. >> a new normal going forward with china? that's a big transition an one we went through. >> no question. it's multi-year transition. look. i think china's going to be just

fine. it's big. its growth rate is the envy of most other places. >> what is the worry spot right now? >> my biggest worry is deflation threat of oil, ecb with nominal growth close to zero. several countries in recession. inflation number negative. europe needs to get out of that deflation rut for the world to be okay. >> bob, are they able to do -- is draghi able to do something with interest rates where they are and the euro where it is? will they have a big bah zoo da ka? two weeks? >> i hope we're not disappointed. it's time to do what it takes. i think the backs are to the wall. greece russian sanctions, germany slowdown. whether they say yes or not who knows? they don't have to say yes for draghi to move forward. >> what about the jobs number friday? how strong do they have to be to justify markets at these lows?

>> 240,000 in 2014. i think a shot at that or more call it 250 and 3 million new jobs. we haven't been there in a long time. >> we haven't. brian kelly, europe and long or exposed now ahead of the decision of mario draghi what does it take from him at this meeting here to not disappoint investors globally right now? >> an awful lot and probably more than he can do and why i think in shorter term short to medium term we get a weaker dollar stronger euro because we've all expecting something to happen. he is constrained about the germans. at the same time, the eurozone is too important for anybody to let fail. something will be done. people anticipating it. probably not the time to be pressing euro shorts. >> same time of the numbers this morning of european inflation negative. >> exactly right. even if the ecb does what we

hope and expect i'm not sure that's sufficient for europe to get out of its rut. that's a necessary condition i think but it needs structural reform and doesn't happen overnight. >> very difficult to happen. by the way, what do you think happens with oil and commodities here? >> path of least resistance still down. look. >> what do you make of the decline we have just seen and still happening today being a slight -- >> it's the magnitude, the pace of the decline is obviously what has us all concerned if this happened 100 to 50 over the course of 2 or 3 years we would be saying yes. it's the decline that causes concerns of credit and other dislocations to get through. if and when we get through that i think it's when and not if it's great news and we couldn't ask for much more than low oil prices. >> to you, brian kelly, do you feel like the low oil story is here with us to stay and how are you setting up for friday's jobs report? >> i don't think the report matters anymore. the fed told you they're

concerned about inflation. oil, number two, somewhere around here. we're in the range of the bottom to be put in. that being said i do not think we go back to $100 a barrel. the rigs coming off line they're easy. it takes a month to put them back on. gasoline demand is dropping. one week. you know i think we are in this range. i'll call it 50 to 70. >> all right. that's still a high end of the ranges i'm seeing lately are. thank you so much. bob doll thank you so much. be sure to stick around brian with the "fast money" crew at 5:00 talking with the ceo of gopro nick woodman. the shares have been under pressure. oil prices plunged nearly 40% in just 2 months. next guest said the folks shorting oil just getting started. we'll talk about that straight ahead. could the fed shock wall street raidsing rates sooner an faster than people think? goldman sachs ceo saying don't

rule it out and the chief economist that works for him said rates won't be raised this calendar year. we'll talk about in it a bit.

welcome back. let's send it over to our dominic chu for a market flash. >> watching shares of herbalife. they were up about 4% in the regular session. earlier this morning hedge fund manager bill ackman talked about the short position in herbalife and they responded with a statement via a spokesperson saying that bill ackman is entirely predictable with the put options expiring next week he is off on yet another tirade of misrepresentations to drive down our share price. the facts of the business are inconvenient for him and he clearly has no interest in learning them as evidenced by his team's last-minute cancelation of a meeting last month that he requested. end quote. again, that was a statement from herbalife via spokesperson regarding bill ackman's appearance this morning talking about the short position in

herbalife's shares. back over to you. >> thank you. turning to oil, below $50 a barrel and comes off fresh lows today. jackie deangelis has the latest. >> that's right. 72-cent pop at the close at $78.65 and low this is morning under $47 for wti and under $50 for brebt which is fairly significant. traders are telling my this is a technical bounce. typical when you have seen the kind of selling pressure of the last few days but the bearish factors remain. first, you were talking about it. the dollar index at 92. strong dollar lower crude. also inventories today. gasoline, 8 million barrel build. not the first week the see this. it indicates that demand is not out there. china forty quart gdp, talk of a five-year low and people are worried about demand with the china picture so all of these things together i don't want to be debbie downer here and looks

like we are going lower. >> all right. jackie, let's find out. the next guest says volatility in oil is not going away any time soon. we're joined by kathleen kelly, welcome. >> great to be here. >> start with the positioning in the market. how long or short is everybody now on oil? >> positioning's not that bad looking at short tons commitment of trader. they have come off a little bit. they're not as high as they have been for five years. longs aren't that long. also, they have been coming off and might have been year end book squaring and the selling of the last two days probably people putting money to work in the space so i think we have seen the shorts start to show up here and i think just at the time starting to see positive signs of de&. >> what are the positives that you see in demand? rig count is coming down. what are the factors to push oil higher from here? >> we have started to see china is pretty good and imports. u.s. gasoline demand is picking up. in december at the highest ever

for this time of year. you can't look at the weekly numbers we saw now. you have to look at the three or four-week average and picking up strongly. we have seen the put skew really off as far as puts versus calls and people are positioned for a downside move in this now and setting up that you might see a move up. don't forget we have an index rebound that starts right now and starting i think tomorrow for all the index rebalancing and that's very positive for both crude and brent. >> in the fed minutes they talk about oil and the fact of the lowest levels in 5 1/2 years. as a temporary situation, we are seeing some corporates make some permanent decisions, layoffs, reorganizing the capital structure based on the price of oil and wondering whether you think it's temporary or more of a longer term phenomenon. >> producers produce. that's the job, right? they have been through the cost of production many times forget. as we're seeing crude prices come down cost of production comes down and across the

commodity spectrum. >> how much? >> you're seeing energy costs as a different factor. right? crude doesn't have one of the higher energy cost factors in the own production but metals do, you know you are seeing that in others. construction costs come down. a you will of that for drilling and mining to come down. so people have to -- that's one of the risks we're not going to see the production cuts as fast as we want to. >> to that exact point, when do you think we're going to see the production cuts? we are starting to see the cap x cuts, right? no one's changing the production cuts. is that the next shoe to fall if you will? maybe during earnings season and do you think earnings estimates have already come down enough or is there another leg down? >> i think the guys look through the cycle and they have been through the cost of production before. they have been above it for a long time and produce through the cycle. i think what you're more likely

to see is opec make a move. iran is startinging to a bit more conciliatory. if we see them make a deal on nuclear then we are going to get for sure the saudis cutting so i think that's more likely to start stemming the fall. but i think you do -- definitely you can see crude prices lower. at this point right here you are starting to see demand pick up in lot of different countries. >> i like your point on this that a lot of focus, once we saw this huge sudden drop in crude on and how long everybody was in it june and if your point is that the market is balanced perhaps some of the financial factors if you will have flushed out. i don't know how else to put it. maybe perhaps it's some sortquilibrium here. >> i don't think it's a move in production. we can either get domestic prus opec production or we can get demand to pick up.

i think what you are starting to see is demand side to pick up. if it's enough to stop the move for long term is unclear. for here it's clear. >> thank you for being here. >> thank you for having me. is the market in for a rude surprise this year? many believe interest rates will be hiked this year and it could happener sooner and more than expected. kevin o'leary think the franchise numbers bear out on the ground for entrepreneurs? he joins us later.

welcome back. we begin here with an earnings alert. dom? >> kelly, what we are watching is you bick wous wd-40. yes, i use it on everything like frank's red hot. the company posted weaker than expected first quarter results. the shares down by about 4%. among the things cited here weakness in sales in european markets and linked the decline to impact of foreign currency exchange rates and a things to see develop in the earnings season and foreign sy currency rates as a headwind of the company and they say, interesting here a global marketing organization for lasting memories of workshops and this is what they say.

>> i love that. i love that. wd-40, a miracle product. >> it is. i use it on everything. >> truly, a gift. thank you. but again, the share's under a little bit of pressure there. goldman sachs chief economist with a note saying the first increases from the fed could be pushed back to 2016ment this morning goldman boss ceo of the firm had this to say about rates. >> a lot of the world structure has been built on assumptions and i'm afraid that one of the assumptions in the last go around was the assumption that houses prices can't do down by 40% all over the world at the same time. do you think there's an imbedded assumption that interest rates can't go up sharply to a very high level over a short period of time? >> little bit. joining us right now, kevin o'leary who think there is's a chance the fed could raise rates this year and rick santelli is back saying he doesn't think the fed is hiking this year.

kevin, why do you think they move forward on this? >> because i'm an optimist on something that we have turned into a pessimistic story. i think about 65% of those that look at the energy decline and repeating and said this is bearish because it's an indicator of inflation. i ask myself if we could re-engineer the economy of zero cost of energy isn't that a good thing? i don't think i find anybody that would argue that zero energy costs and input costs on energy wouldn't be good so as energy declines i take it as an optimistic index in this way. we haven't given the economy enough time to absorb the impact and so by q3 and q4 i think we will have bullish growth and earnings. i'm an optimist kelly. i hope it's going to 35. >> understood. rick, i know we have talked about what you think the fed or shouldn't do. what do you think in this case

they're not actually going to raise rate this is year and why? >> i don't think they will and i think it's most likely because of the second pillar and that of course is price stability. if you look at the original congressional legislation, it doesn't say 2%. doesn't mention inflation. doesn't mention deflation. it purely states stability of prices. doesn't say whether it's stability to come at minus 1 on pce or plus 1. relatively stable prices. and i would say that they are stable. but in the fed's eyes and all due respect to our "shark tank" host there, there are many central bankers around the world this pointed fingers right at the energy market saying you know, this is creating deflationary pressures and it is really rich coming from japan who imports all of their fuel and be careful of assumptions and trust me. i did it in terms of no interest rate increase in 2015.

trust me if anybody's going to know if it is going to occur, it most likely is somebody at goldman. >> i would going to say, as people talk about not just the deflation of drop in oil but the negative effect on the oil patch economies. how do we know whether it offsets the boon that kevin is talking about? >> that's absolutely right. i think there's a point here. you know the oil industry everything is renegotiated down and pay different prices when everything is flush and there's less of an impact there. but i don't know. to lloyd's point, we are used to really low interest rates and unexpected things can happen. and they always happen. when you don't expect them. i'm not saying he's right. look at oil. >> look at oil. >> that just -- >> nobody was expecting and just happened. >> exactly. even the financial crisis. he is right about this. >> hey, rick do you think we see higher wage growth this year? and if so, does that force the fed to do something earlier in your mind? >> listen.

there is nothing that i would welcome more other than tickets to a cub world series than rising wages. but i don't see that there's anybody out there that is doing anything really that's going to help wages. as a matter of fact, i'm a firm believer that right now that corporate america and indeed many multi-national corporations around the globe have it pretty good. we live in a global economy where education hasn't caught up to globalization. you have just boatloads of cheap lay before out there and i would wish to see but i don't think we see it in year or years to come in a sizable fashion. >> kevin, why do you think we are going to see it? >> let's take the most pessimistic scenario and let me explain why it's a good thing. let's assume that all of the debt that has been given to oil companies is defaulted on. i mean every dime of it. okay? >> right. >> here's why that's good. there's been a lot of cheap

money given to at will of idiot management team that is have bought assets they can never afford if rates go up. say they default. the ownership of the assets revert back to the bondholders and through litigation the strong managers end up with the assets. this is like a spatula coming from heaven and cleaning up the entire energy index into stronger hands as we move out of this low. i argue that this is a good thing. it's good every once in a while to flush the weakness. when a dish dies in the ocean, the crustaceans eat it. >> but if the fish died in the ocean and janet yellen was in charge of oceans she would have a moratorium on dead fish. >> mixing metaphors. >> which one is more likely tickets to the cub worlder is series or wage gains? >> wage gains, absolutely. >> we love it. thank you both. thank you, rick. have a good evening.

kevin, see you back here in just a bit. up next the latest on the tragic and deadly shootings in paris. 12 people massacred by gunmen who you can see here escaping in this amateur video shot in the terrorist attack. we'll have the latest on the manhunt for the murderers, next.

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horrific day in france. 12 people murdered by terrorists in paris in attack on the offices of a satirical magazine that has previously published

cartoons of the prophet mohammed. hadley gamble joins with us the latest. haddy? >> reporter: hey kelly. what we really understand now is that the police are searching for three suspects two of whom they believe to be brothers from the paris area. we also understand of course that these anti-terror police according to the paris daily, they understand that they have been searching apartment buildings in the area as well. now, you have to of course remember francois hollande is having a tough time as president and everyone is watching to see how he reacts to the situation. he was out on the scene just blocks from where i'm standing where this horrific attack took place today. 12 people murdered. 11 wounded. two of the victims, policemen we understand. some of the other victims, famous french cartoonists for this week lisa tir call paper charlie. we understand about these guys is that they're used to poking

fun at french political figures. we understand also that these attackers obviously did not take kind to some of those political cartoons including those of the prophet mohammed. at the same point, thousands of people already gathered. they have come out to show solidarity and support for the victims of this attack. we're seeing similar things across europe similar protest movements in london brussels and of course in spain, as well. we'll have to keep watching to see what comes over the next couple of hours. we understand these anti-terror police are hot on the trail of the three suspects kelly. >> our hadley gamble thank you so much this evening. the manhunt continues in paris for the terrorists. let's bring in clint vanzandt as a former supervisor of the fbi profiling unit. good to have you back. as we get details about this can you tell sfishow sophisticated and preplanned this was?

>> i think it was preplanned a lot. they used multiple vehicle. same uniforms. they had weapons. ak-47s. rpg rockets. they used to three-point straps to carry the weapons. they probably have body armor on underneath. bottom line is these three guys didn't fall off the terrorist turnip truck. they've been around before, had training support. they have got intelligence. they have planning. this is something that they plan on doing. they went. they executed it. not only did they execute their plan but they executed 12 people as well as wounded 20 others and one more time we see the bull's eye that's been placed not only on journalists but on police. we lose two more police officers today. it's like it's hunting season against police officers. what it is uniformed standout bad guys know if they take out the cops right away they have a clear field of fire at somebody else.

that's what they did in paris today. >> understood. it's interesting to to me seeing ing ing, some beginning with a cartoon of 11:28 mocking the isis leader's new year's message and then attack at 11:30 local time. two minutes later. is it too much to think it's a spontaneous response to that tweet? >> yeah. i think it's too much. i think they're planning. they had the game plans in. a couple of things though. number one, initially, they ran in the wrong building showing no matter how well you plan you can go in the wrong building. it's a terrible incident. can you imagine they run in looking to find their soon to be victims an they're in the wrong shop totally. so they have to do a 180, come back out and start all over again and they did that. what's interesting is what was just reported. supposedly the french identified at least two brothers. where does that take us to?

just in boston where we saw two brothers that were part of that attack too. for similar type purposes religious in nature. >> just to be clear because we haven't confirmed the details yet, i don't want you to speculate on it too much but what's interesting to go back to the nature of this and some others in the intelligence community have said perhaps this is one part of the islamic jihadist community for lack of a better word against another. how do we know if it isis or is it one upmanship or something else? >> at least one of the individuals said taking credit we are al qaeda. let the world know. so he was out there to deliver that message. the question is what's the purpose? and again, one more time in the world where we're held responsible. we have to separate religion from politics again. you know? we have to separate the sin from

the sinner one more time. and we're looking at someone who did this for political reasons, perhaps religious reasons. but that doesn't mean we should hold the religion itself responsible. this is the challenge for me. i assume it's a challenge for the rest of the world trying to separate islam in this world. >> for the professionals in the media. final question. what kind of intelligence response do you expect now? what do you think would be the right way for those who want to make a point about free speech to respond here? >> well i think what's being done right now, the rally that's going on the way the world is rising up again. we've got two communities to support. number one is journalists and their right to say whatever they want to within the laws of free speech in that nation. number two, law enforcement that's sworn to protect these people and interesting one more time how vulnerable police have been. these are the groups. this incident shown us one more

time to support but free speech has got to win out. we cannot be muzzled by three bad guys and two ak-47s. >> clint, thank you very much. our hearts go out, of course to all of the victims. we'll be right back after a short break.

readers on the website following the tragic terror attacks in paris, too.

and other stories drawing attention. hi allen. >> yes. that paris event drew a lot of readership. and the oil obsession continues. we are leading with a feature taking a look at why oil prices are likely to go lower. and the short answer is we had the new readings on gas inventories this morning. way beyond what everybody was expecting so we're swimming in the refined stuff. there's not going to be much demand for the crude stuff. number two, and this is a story that i know you'll really be interested in kelly. bank rate survey looks at 6 out of 10 americans do not have enough in savings to cover a household emergency. >> oh in. >> like an emergency room visit or a $500 car repair. bank rate survey. >> wow. >> 28% of those surveyed said they would just go to credit card debt and pay for it that way. >> yep. so often happens. >> slippery slope. looking to save money, we have a feature with whether's happening with interest rates, might be time to think about re-fi.

refence refinancing your mortgage. estimates put 7.4 million people could actually get more than a percentage gain out of re-fi'g right now. that's a big savings. >> can i ask an industry question? what is your mortgage rate? >> 4.2 and thinking about maybe could i really squeeze a full point out of that? >> you know i was talking, jim and i have been having a funny conversation of watching mortgage rates as closely as watching stock prices. when he was much younger. do you know what i mean? you can almost quote it at hand. did you see the 10 or 30-year today? >> bring the money matters and come home some day. there you did. >> allen, thank you. good to see you this afternoon. >> thank you, kelly. 2014 marked the fifth straight year in the growth of entremendous premurs becoming franchise owners but with the affordable care act, will it be as attractive going forward?

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franchising was booming last year according to an annual industry report but some new concerns are cropping up for franchisees in 2015. kate rogers joins us with the details. welcome. >> thank you, kelly. that's right. despite the regulatory hurdles, owners say could hurt the bottom lines, 2015 is projected to be yet another year of solid growth for the industry. the international franchise association says the sector is set to grow by 5.1% this year up for the fifth straight year in a row. economic output from these franchise businesses is an

estimated $889 billion. this means cash to be made and jobs to be created, more than 12,000 new franchise locations in the u.s. will create more than 247,000 jobs in year. but despite that sunny outlook, a government regulations are in the way. according to the ifa and the membership, both minimum wages which have been hiked in 21 cities as of the new year and the affordable care act have owner s owners like one i spoke to today concerned about his future ability to grow. now, the ifa says 85% of the membership believes these two issues will have or have already had a negative impact on their businesses. back the you. >> i love auntie em's. this is a surprisingly common conversation and now seeing the numbers, that explains it. about people anecdotally saying why don't we open a papa john's or one of the rest rapt names? >> started 20 years ago with one location and now over 70 across the country and concerned about the regulations.

>> let's ask mr. "shark tank" himself kevin o'leary back with us. in the first place, would you get into the franchise business? secondly, with some of the concerns kate mentioned here? >> well those are valid concerns. if you poll at the state level or the city level people that are operating businesses franchised or just standalone they complain consistently complain consistently about regulations that are not just federal, but state and municipal. we're probably at a tipping point now for the first time in our economy's history that we have burdened these businesses in a way that is making us less and less competitive. the franchise model, one of the dark secrets about it to understand is the reason it's had such strat atmospheric growth over the last five years is the dirty truth is for small operators, let's say you're starting you've got three or four successful retail operation, and you want to expand and keep them corporately on the other hand, you can't borrow that money from banks

anymore. i don't care what anybody says. i live in the streets. i've got 21 investments in small and mid cap businesses. there is no capital available for them at all. so they have to franchise. >> that's an interesting point. how much do you guys here on the panel as wealthy that the ability to open and finance some of these places is a problem? >> well i mean, it makes sense is right? it's been a tight market for a while. maybe that starts to loosen up as the economy improves. i will tell you from owning companies like mcdonald's, that's been a massive success and part of their story. >> you're not talking about being a franchise owner. >> no, no, no. but we own the stock. but a lot of the restaurants are doing it. and they all pretty much have to do it to compete effectively. it's going to be interesting to see how it all works out. >> look at a marriott. look at the hotel chains. >> sure. >> so many of our biggest brands operate on franchise models. oh by the way, people think franchising supports small business. some of these franchisees are

very, very large. they grow to become huge. >> and we're now in the 60 era of deleveraging cycle. so a lot of consumers do have dry powder. they're getting the benefit of the refund of lower gas prices. interest rates are still low. the 10 year below 2%. any loan they would need or any type of financing that is priced off of treasuries is still going to be very affordable. it might be a ripe time. >> what you just mentioned too about low gas prices is something the ifa brought up on their conference call. the retail franchise businesses are doing fantastic. >> let me just ask you, kevin. give us one example of a franchise business you would get into and one you wouldn't to right now. >> what i have learned is having looked at probably 100 over the last six years, you've got to understand the model is to extract 5 to 7% in perpetuity off the franchisee. the only reason they would do that is they're getting some value. for example, national marketing,

a national brand, et cetera. too often what i've seen and what i'll never do is get involved in a franchise roll-out at an early stage. just because you've got one or two or even six successful locations, it doesn't mean you're capable of rolling out a national franchise operation. extracting 5 to 7% which is the average of the franchise model is basically a 33% component of the company's profit of the individual operator's profit. they better be getting a lot of value. and the only way that works is when you get big and successful and are able to corporately manage the process. so talking about mcdonald's is one thing. and that's been successful for decades. but if you're rolling out the next hot lobster store or something like that, i've been involved in those. and they go to zero when they collapse on their own success. it sounds like a ponzi scheme. getting $23,000 from 15 people and not giving them any value for it. i'm very cautious about that. >> i'm glad to hear. because actually again, a lot

of people have looked at this and thought maybe i can make this work. there are many important considerations. kevin, thank you. good to see you. kate o'leary, thank you so much as well. after a 002 phew days of steep losses, the market is staging a rally today. will tomorrow be more of the same. if you didn't buy the dips earlier in the week is it too late? our panel with thoughts next. ♪ ♪ ♪ ♪ ♪ ♪ ♪ ♪ the evolution of luxury continues. the next generation 2015 escalade.

stephanie, starting with you, i know today was a little better. it's a little early to throw in the towels. >> the first week is always a little crazy. pms are repositioning their portfolios. so you can't read too much into it. we have very encouraging data on auto sales. we get bed, bath & beyond. we get the container store after the close tomorrow. keep an eye out on more retail and hear more about the consumer. they're in pretty good shape. >> bank earnings next week are going to be very telling for the market. i think everybody is expecting that margins were compressed yet again. now that's been well telegraphed. what did trading activity look

like and how is some of the volatility actually translating into business, or is it? >> right. >> i know we're not going to get that for a few more days but i know a lot of analysts were setting up for it. >> the jp call for goldman to break it up to create more value. wells fargo, one of the great performers, the best in this space, up 27%. >> and surpassing citigroup as the biggest bank ever. surpassing citigroup's early 2000s record when it was at the height of the empire building. pretty massive record. i think everyone is calling for wells fargo to cool off from here. it's a business model very different from some of the over bracket banks. but we'll see how it fares. >> init's interesting on the banks in general. can the better economy push up loan growth and costs continue to be contained. and will that offset the pressure. that's the question that we have in the portfolio. >> if they weren't coming from such a low base would there be all this positive momentum just because improving economy just what has happened with interest

rates. >> certainly. and i think there are going to be pockets of the financials that do well. mortgages, we'll see how that does well. how about credit cards? that should also do pretty well. so of these conglomerates will probably see pockets good and bad. i have to get confident in the net interest margin. >> some breaking news with. >> three names of suspects according to an anonymous french security officials in the killings today in paris. the two officials that they're quoting say the suspects name are syed and shareef kuachi. they are brothers as well as 18-year-old hamid murad who whose nationality wut wasn't immediately clear. we know shareef and sayeed are french. we're waiting to see if there are any arrests. once again we know the names. back to you. >> michelle caruso-cabrera, thank you so much, michelle.

confirming some of these details that two of the suspects are now named suspects were in fact brothers in the paris terrorist attack this morning. my thanks to the panel. thank you to everybody or the watch closing bell. "fast money" starts right now. live from the nasdaq studio, overlooking new york city's times square i'm melissa lee. our traders tonight are sim seymour, brian kelly, karen finerman. rough day for gopro. the stock ending lowering by just 4%. we'll hear from the company's ceo nick woodman. first, stocks staging a major rebound, snapping their five-day losing streak with all three major averages ending the day higher by well over 1%. the dow finishing up 212 points. oil, take a lack at this. finishing in positive territory, putting an end to a four-day slide as fears over a greek exit. brian kelly, you said the fomc minutes were big today? >> i actually think they were.

i think what the fed told you in the fomc minutes today is don't worry about jobs anymore. the job market is not their biggest concern. their biggest concern is inflation expectations. they said they need to see inflation expectations go back to