hour as the dow right there near its session highs, up 312 points. >> indeed. thank you very much for doing double duty. great to be with you, as always really fun. >> thanks very much for watching street signs, everybody. >> see what happens in the next hour as the "closing bell" kicks off right now. welcome to the "closing bell", everybody, i'm kelly evans on this thursday at the new york stock exchange we have ourselves a rally. >> i'm bill griffeth. building on yesterday's gains and now, we had three big down days to start the year. two big up days to follow that and those two big up days wiped out the losses turned positive for the clear for the dow and s & p. >> started the year all of monday and where we are today it is almost unchanged, having had that sharp downward move. now this upward move. now the guys better break those down, 18,000 become out them >> i guess so. seeing somebody walking around

here. let me show you oil, wti crude, for a time this rally occurred even though the price of oil was sharply lower, as you see there, until near the close. and look at that turned right around and became positive again. article carbon reminding us all day that to keep an eye on wti crude because it's still calling the shots in this market now. >> that is an important point, we continue to debate those areas, as oil continues to fall or not. retail names to focus on as well. get to where we stand with the markets, an hour to go near the highs of the session, dow up 319 points, about 1.8% exactly the same as the s & p is at the moment of 37. the nasdaq adding 88 points a little pit -- outperformer today but only pie a little bit. nevertheless, some pressure across the internet name there is, bill. >> get to our closing bell exchange for this thursday. we have got cnpc contributeor heather hughes with us. hi there. jim lowell from adviser

investment. joe hider from cirrus wealth manmanment with us mark lieu sheeny from janie, moment comery stock and our own rick santelli. mark there are those days when oil and stock market move in tandem and then days when they move opposite directions. he had both of those today. what do you make of oil and its impact on the markets of the economy? >> it's interesting, bill. i think an unambiguous positive it has fallen as precipitously as it has. at this point in time shall think the market would welcome price stability. i think if oil continued to plummet and breakthrough $40 a barrel, i think the worry would be increasingly that the equation of is it an abundance of sun ply or lack of demand would start to lean more heavily toward the fears of lack of demand, as a consequence, undermine equity values. pause we are starting to see perhaps some at least intermediate flora coming into oil prices in here i think the market is bidding on that or

biting on that and getting a bid as a consequence. >> you know just focus if we can for a quick second on the biggest performer in the down united health almost a 5% day. jim lowell here you say you like health care. explain to us some of the reasons why you think it's continuing to outperform. >> well there's no question about the fact that they are lower risk but still correlated to the growth stock side of the ledger. we like them in general, but when you look at the net star demo dprfic trends of aiming populations here and globally you also look at the emerging great story of emerging markets demanding more consumer health care less invasive means, we think the sector broadly but in particular, longer term the biotechnology subset remain very positive for investors. >> joe, jim, is it a defensive play as we traditionally think of it or a true growth play now do you think? >> i think it's really both bill. it depends upon the funds that one would use. so for example, hartford health care is a little bit more skewed

toward the pharmaceuticals, a fund like fidelity select health care a little bit more skewed toward biotechnology needs. be a little bit smart about the kinds of managers you adopt and pursue the health care opportunities, but i like pot sides of that fence. >> heather, do you guys like the health care space? >> the health care sector definitely did well last year. you also have to look at those retail, the retail sector of consumer discretionaries today on the backs of lower oil as well. and that seems to be also looking toward the positive jobs report on friday. it seems to be kind of helping the consumer and we have really been wanting to see that utilities and the treasuries were the pest performing asset classes last year. so, wouldn't be surprised if you see them as the worst performing asset classes this year. >> yeah the jobs numbers we have had this week the adp private payroll number was good yesterday. the -- >> yeah. >> claims this morning were a

little less than hope feared and story of hopes for tomorrow as well. joe hider what do you buy here? had a round turn, if you will? are you gonna buy this strength? sell on this strengthette and expect a further down turn or what are you doing? >> we think -- we are generally positive on the market. the market doesn't like uncertainty. the sharp drop in oil created some real concerns here and then you had greece thrown in there, which nobody is talking about now that we have turned back to the fundamentals of the u.s. we think long inequities particularly the u.s., is the place to be for 2015. >> rick i know we talked about -- >> jump in on that? >> go ahead. who is that? >> i was gonna jump in on top of that and say one of the things we have basically overlooked is the positive impact of lower oil prices for the euro zone in particular. we just saw yet another month of games in the retail sales side and i think what wither gonna see is the knock-on effect as

positive for the euro zone consumer, clearly been the holiday spending season for the u.s. consumer. >> interesting though we didn't actually see that great consumer confidence data out of europe and might expect that would be one place it was starting to show up and i know they have a lot more taxation of oil there, they don't necessarily filoer gas prices as much. rick, i was going to ask, do you think that stocks are overlooking the risk here from a couple of weeks time mario draghi doesn't come out with the bond markets priced in anyway? >> i think that central bankers figure prominently all the activity of the marketplace today. anybody watching the s and p's rocket up about 8:00 last night, thank charles evans for the use of the word catastrophe in the same sentence basically removing stimulus and i think it sets the dynamic. you know, pack in the day, when richard fisher the hawk used to say something, it really never moved markets. there's no symmetry to this. you get the doves and it moves it and shows you that the equity heart is still into the kind of

you know, the kool-aid ride to speak. make tomorrow's number so much more difficult to trade pause we all know there's a jobs number out there at some point that's gonna reflect some of the job loss and i say it's positive decould.struck with regard to energy. but when you take europe and all the other variables into account, if it's a really weak number tomorrow, i have this feeling that the s and p traders are going to be pieing the dip and if the a he is a strong number we might reinvestment back to the old days where, oh, no, maybe that means really going to tighten in 2015. i look for a very confusing response if we get a extreme number tomorrow at 8:30. >> what kind of parameters are you guys looking for, rick? what constitutes a strong number? what constitutes a weak number tomorrow do you think? >> i think anything over 250 without taking away much of last month's very strong number would qualify. and so revision the last month is going to be huge. anything under 250 i think is going to be viewed as you know

okay. anything under about 225 i think would be perceived as weak. >> heather, you agree? >> i would say that the oil cuts, the jobs, the layoff from the oil sector which is a negative or downside to the price of oil being this low right now have not yet been factored into the jobs data. might see 245, 250 tomorrow over the long run, i think you will see a bigger impact from the energy sector having to lay off workers, north dakota south dakota and texas. i don't know if anybody heard, you challenger graham christmas, saw the fewest number of layoffs in corporate america back to 1997. didn't feel like that. >> i still have a job. >> i guess it was better. right. we still have a job here. joe hider, you know i point out, the last couple of weeks, a lot of people were coming out saying they would step in to buy europe knowing that it was something of a contrary play to begin. you're emphasizing pounding the table on u.s. equities. what are you waiting to happen

in europe before you would want to go back over there again? >> well we have our investors in europe. but we still believe u.s. equities are much stronger. they -- we have to see stronger numbers out of europe. they continue to produce some rather anemic numbers. it's going to be interesting to see what the strengthening of the dollar in the u.s. which obviously make their goods and services lower priced to the u.s. consumer. if that has a positive affect on europe as well as other parts of the world, such as asia and emerging markets. >> it's a good point. you know, just reminds me as well of one of the weaker performers today, caterpillar in the dow. >> wow. >> only fairly positive the last time i checked, that one under pressure for some time. jim lowell you like dat pillar here? >> well, i don't know if i like any industry that's specifically related to producing goods and services for the oil industry in the short term. long term absolutely. i'm not an individual stock

buyer. i would say, just to get back to the euro zen, i think the economies are in relatively better shape than they were during the last big crash. i think the politics have worse.ed, that is the issue. we think the eurozone economies could grow if the european politicians could just grow up. i'm gonna hold onto t >> if anything just now more momentum for the anti-european parties. they have a real risk again, jim of breakup, sympathize with some of the leaders over there. no question, there are risks there one of the reason there is are garbargains in that basement. >> i mike take the contrarian view point. last year, u.s. markets outperformed international markets by 10%. while international markets, especially europe undervalued now, u.s. is still the strongest

developed economy in the world and with a strong dollar you're still going to see financial assets globally flock to the u.s. markets. the question whether people were willing to bet on mario draghi the way they bet on ben bernanke, once upon a time. jim lowell, almost make me want to wear a bowtie. very festive tie going. >> maybe for friday jobs day, bill? >> maybe. maybe. >> only over 300? >> i don't look good -- people asking me to serve drinks or something when i wear them. the manhunt intensifying for the killers in yesterday's gruesome terror attack in paris. >> continuing to cover this story for must paris, joining us now with the latest developments. hadley? >> reporter: right now what we snow that over 88,000 security and law enforcement personnel are scouring the french country side looking for two men they suspect in the killings of the

12 journalists who were murdered yesterday, just blocks from where i am standing. now this is the most massive manhunt in french history looking for to most wanted men in france. what i have to tell you tonight more than anything heard from francois hollande saying the men will be brought to justice and looks like he pulled out the big guns to make that happen as well. now, what we know these suspects, they are pot in their early 30s, we understand that they are parents are algerian born, french steps, can move clearly in france or could until earlier today. police releasing their photographs late last night. we also understand the third suspect in this case turned himself in overnight last night as well. but there are nine people apparently in custody az of right now. all right. hadley gamble for us tonight. thank you so much this evening. we have about 45 minutes to go here into the close. the dow is up 317 points gapes of about 1.8% today across the

major averages. check out shares of constellation brands. this one still surging, this time again on strong earnings. just think about this. if we went back further, this is $108 stock. right now, two and a half years ago, $20 stock. >> wow. >> i mean it has been really on fire the last if you years. we got ceo of the company breaking it all down. their latest report on earnings find out how he plans to keep drinking up profits for us. that plus much more straight ahead. we have also a discussion about the middle class. larry kudlow and former representative barney frank going pack and forth some comments senator elizabeth warren made today, taking aim at the middle class a the financial world. stay tuned.

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welcome back. nearly every stock in the dow is still positive. a couple underperformers, we mentioned earlier, include caterpillar. the biggest story of the day is united health care we heard just now from jim lowell one space people like to describe as value and growth. you can understand its appeal. the nasdaq well today. you see up 86 points lamb 2% gain. morgan were enen is tracking the

market movers today. what are you finding morgan? >> begin with meade west investigate gashing the leading gainer in the s & p 500 today after the company announce it had would spin off the chemical business that stock up more than 5%. twitter also trading higher. reporting that the company have a plans to unveil video products in the next weeks, up 4% now. but a different story for infinity pharma. this is falling on news it would stop testing its lead drug as a treatment for rheumatoid arthritis. seen that stock down almost 11% on that news. and we end with constellation brands that much's gaping ground after posting a 7% rise in quarterly revenue, helped by higher sales of its core rope nah and med dell low air brands. stocks up 5% as well. thank you very much. more now on constellation brands. with us, exclusive interview, welcome back to the company, ceo rob sands, down in florida today, sitting on the sand -- >> welcome back. >> enjoying a margarita his companied me or something. >> thanks.

who you are you, rob? >> i'm great. how about yourselves? >> i don't know how many quarters we have talked about the earnings and stock keeps going higher but we talk mostly about beer. why don't you just go in the beer business? that is by far your strongest sector. wine has been weakening a little bit. what is it about beer that's still so strong? >> well we just happen to be in the right police in the peer business. if you look across the beer business, it's imports and crafts that are growing and then within imports, of course the mexican category led by our products corona anded me dell low especial in particular. that segment of the business is extremely strong and enjoys some -- enjoys some things like demographic trends that particularly favor these kind of products. yeah, as we understand they are popular with hispanics and people familiar with the mexican brands from traveling down there as well over the years. amazing, rob, you talk about budweiser, for example which

has been all over the place this terms of people discussing why budweiser and bud light really kind of miss the boat missed the trend toward these craft bruce and imports, as you were mentioning. what happens though if the tastes, which are so fickle or start to shift as for whatever reason, people prefer mexican bothers, for example, start to move elsewhere. do you see any evidence of that happening? how do you protect yourself against it? >> yeah we see no evidence of that i think that there's a couple of long-term trends that our products in particular take advantage of. you know a trend toward premiumization, people are drinking more premium peers like our products corona med dell low especial. people want more products than the light products a trend toward drinking more flavorful products in general, makes products like our corona light really popular versus the traditional light peers. >> i read the transcript of your

conference call with analysts. i know you tried to down play this soft spot in wine but let's talk about this. i mean, is this -- you called it an anomaly. but we have been hearing about soft spots in wine for a little while now. why are we drinking less wine or what's going on in that sector you. >> yeah so the wine business is actually quite robust. it had been growing, talking about dollar sales in let's say the 5% 4 to 5% range. and slowed down to the 3 to 4% range. so, about 100 basis point shift, but fundamentally for fairly large consumer gods category still very good growth in wine. in our particular case our wine business or our wine and spirits segment was flat this quarter as we focused more on ebit growth which we were very successful in

generating very strong ebit growth in our wine and spirits segment and spirits, which is sort of our third leg, we had about 26% growth in our spirits business. so that was really a phenomenal outcome for the quarter. >> two related questions about commodities, quick the one being in terms of your costs what do you see with weight and input and what do you expect to do with prices next year and the other, what kind of impact are you seeing from the huge drop in oil we just witnessed? >> number one, commodities in general, we are not see inflation, you know beyond i will say very low single digits. so we don't see that as a problem. and, you know oil -- oil and gas prices have been tail winds for us. and, you know, i suppose we all expected to see a bit of a uptick given what's happened in that market. but in general, lower oil

prices, you know obviously helps the consumer and they will probably drink more beer wine and spirits as a consequence of it. >> i also noticed in your -- the transcript of your conference call, premium price products growing faster than super premium. what's difference? premium i always thought was top shelf. super premium the stuff you can't even reach when you reach up there or what? >> so actually that's the nomenclature of the business. we talk premium in wine we are really talking about $5 to $8. we talk super premium, it is $8 to $12. ultrapremium is $12 to $15 and luxury is over $15. so that's how we talk about the various categories and what we said was that our premium, which is actually lower than the super premium is growing faster than our super premium, which we didn't expect and therefore, was a bit of a negative mix for the business, the wine business. but what it says though to me is when you couple that with this

strength in peer your customers are very price conscious, aren't they? >> yeah. i would say that in beverage alcohol period there's quite a bit of elasticity and consumers are quite price conscious. there's no question about that. >> rob, just before we let you go deflation, you already brought up single digit inflation, sensity of prices, a debate we have on this channel all the time. do you see evidence of broad deflation in your business? >> no. we don't see deflation in the business for sure. i think on the beer side you know, there's been fairly healthy pricing over the last several years and we think that that environment will probably continue in the same manner and on the wine and spirits side spirits has had some operation and wine's had pricing at the lower end. so not -- not -- certainly not deflation. >> okay. >> as you move up the price

segment, i would say somewhat in the as pricing goes. >> huh. just curious, rob. thank you so much. great perspective on this rob sands, ceo of constellation brands on their earnings. >> about 35 minutes, trading left higher if you are just joining us, her to big rally day, dow up 323 points s & p up 37 putting both those indices pack into the black for 2015. so we have erased those losses we achieved the first three trading days of the year. up next our larry kudlow mixing it up with barney frank. there's plenty to discuss, including senator elizabeth warren's latest comes about breaking up the nation's big panks. and later, steve balmer. that would be him in the middle there. the billionaire who is enjoying his time and his money. that's for sure. the former microsoft star wouldn't win any dancing contests and we hope we don't see him on "dancing with the stars" any time soon but it doesn't look like he cares. we will show you mr. of his moves an tell you what got him out of his seat last night at

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welcome back. more than 300-point gain today on the dow and pretty much, strong gains across the board here looking to the impact a couple of phones reasons. the oil moving a little bit higher after being under pressure same for interest rates as well, both have been moving in lockstep with markets lower. today, the flip side of the story. >> senator elizabeth warren taking aim at wall street once again during a labor union rally.

here's what she had to say during that afl-cio rally. we know that democracy does not work when congressmen and regulators bow down to wall street's political power. and that means it's time to break up the wall street banks and remind politicians they don't work for the pig banks, they work for us! >> reaction now with larry kudlow and former representative barney frank, pot joining us. great to see you guys. and larry, listen this is a pretty stride dent speech. it was at a wage event. was there anything in her language that surprised you, coming from elizabeth warren here? do you think this is a standup call for others in her party to be more aggressive? >> well sure. absolutely. ms. warren wants to move the party to the left. i call it the san dan niece ta wing of the democratic party. let me make two quick comments on what she said. number one, the democratic party is financed pie wall street.

barack obama was heavily financed pie wall street. okay? that's an important point. number two if we want to talk about breaking up the big banks, you know what? i'm sympathetic to that because as i understand it the so-called resolution council is gonna be financed by government taxpayer money, debtor possession will be financed pie government taxpayer money. maybe we should break up the big banks. >> mr. frank as you know senator warren has made it clear that she doesn't think dodd frank went far enough regulating the financial industry. this is your signature bill. i'm thought going to ask you if you agree with her, do you think she just understand the compromises in he is to get a massive bill like that through congress? >> to the contrary, she has never been critical of me or senator dodd the fact getting the consumer bureau through, she participated in some very effective negotiations. i do want to say that i'm disappointed in larry talking about the san dan niece ta wing.

the sandinistas were undemocratic, let's have our differences more civilly. >> agree. but barney, also just said -- >> secondlism >> should break up the big banks. listen, if anything -- were you surprised to hear him say that? >> no no not at all. larry has had a contrarian view of some of the orthodoxy. although i would -- i do have two other points. it is true that barack obama was financed, got a lot of money from wall street the first time he rap. by 2012 that was not true. the financial contributions from the financial community have basically shifted pause they don't like what we did in the financial reform bill. finally, looking at the size of the banks is relevant but he is wroting to suggest that it's tax payers that under our legislation will pear the cost of putting these people out of business if they fail. the bill specifically says no taxpayer funds can be ultimately

used and that any money advanced will be recovered from those very large financial institutions. having said that i think it would be better if they were smaller and did some things in the bill that would reduce their size, like the volcker rule. the problem i have is i don't know how you mandate that. i don't know what you do. i also don't know what's the right size. this is my problem. lehman brothers' failure was the spark for the 2008. i don't see how it's possible or desirable to get every institution to the size of lehman. so i prefer tough regulation and some measures that restrict some of what they do which has the effect of reducing higher capital standards has the affect of probably constraining their growth and maybe reducing them. but i don't know how -- i don't know what size you would say was desirable, who would decide that and how you would get there. >> hey, larrer rick, goldman sacks just this week called for the breakup of jpmorgan chase, saying it is the old -- the

parts are worth more than the sum at this point. interestingly, you think it would be the free market that will break up the big panks as valuations become clearer? >> it could be. that was a very interesting same they made. i agree with barney, if you bra he can them up who is going to break them up? ultimately, i don't want the government to make that decision. i want the private sector markets to make that decision. whether it ever gets made i don't know. i want to say a couple other things about this. number one inside the legislation which i think by the way was way too comp lex nobody understands to this day what's in dodd frank, you, you, you if there is any resolution of a potential bankruptcy it begins, quote unquote, temporarily with government funds. i don't want that i want it to go right into a bankruptcy court. the fdic knows to happened this will very well. point number two. the consumer protection bureau may or may not be a good idea. all the reports suggest they are

stopping mainstream lending and stopping community pax. yous here the key. consumer protection bureau is not -- no oversight by congress. it's being financed by the federal reserve. we have never had anything like this before. it should not be there. it should be its own independent agency with congressional oversight for funding. that was a terrible mistake. >> let me respond here. first of all, when the republicans took over in 2011 they would have a hearing about once every two months before our committee in which they would denounce the lack of oversight in an oversight hearing the consumer bureau. the fact is the consumer bureau has been functioning for several years now and nobody can point to any apows. the problem with lending has to do with capital standards. it's not any rules imposed pie the consumer bureau. secondly and most importantly, it is true that if a bank is about to fail a large institution and not pay its debts, like aid or lehman

there's a temporary use of federal funds to stop there from being a repeat of 2008 but the law is very clear. every penny advanced first you wipe out any shareholder equity you wipe out anything that belongs to the entity. then if there was any net loss, the secretary of the treasury is by law, mandated to go to institutions that have $50 billion or more in assets and recover that money. and larry i don't think that's very complicated. that's mandate and no federal funds ultimately are spent. gentlemen, we got to leave it there for the time being, fascinating. larry, thank you so much. barney frank, thank you as well sir. >> as always. plenty of discussion already online. 25 minutes to go the dow up 300 points. mentioned now just about 100 points shy of reclaiming that 18,000 level we hit right before the end of the year. >> when we come back, not everybody involved in the energy sector is getting hit because oil prices are collapsing. we will tell you about the winners in that sector and if it's too late to get in. coming up.

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yes, 300-point gain on the dow. i don't know if you look at fundamentals, like the jobs number jobless claims that came out this morning, some of the retailers telling pretty good stories about the holidays or if this is just a bounce continued bounce from a selloff we had earlier this year. whatever it is we are back in positive territory for 2015. the dow and s & p as a result of the gains, the nasdaq up 1.8%. pretty pig gain there as well today >> one of the factors today again are the moves in oil price. today, oil still below $50 a barrel. our jackie deangeles following the action for us over at the nymex. hi, jackie. >> hi kelly. the market had cleared direction. what we saw in the oil pit was a little different. oil couldn't figure out which way it wanted to go. wti bouncing around in positive and negative territory before it finished up 14 cents a the 48.79. under $50 a bar approximately. the brent price inching closer to the $50 level.

all traders watching to see if brent will close under 50 pause that will be a key technical level. still, fundamentals right now, pointing to the downside but very interesting to note what investors think at this point. investors putting the most money in energy etfs from all of 2014 at the end of the month in december and also for the first seven days of january. another 376 million came in. some people may be trying to call the pot tomorrow here and get in on the energy trade you there can still be some pain ahead, guys, paing to you. >> thank you very much jackie. oil's collapse wasn't a negative for all oil-related stocks. some surged as a result. morgan were enen runs through some of those winners from plummeting oil. >> we have talked about the airlines and truckers that benefited from falling oil prices but take a look at the oil tankers, nordic american, dht holdings stack cos energy, it k tankers, higher pie double

digit percentages in just the five trading days of 2015. on a tear. why? analysts say with oil futures trading higher than current delivery prices it makes sense to store some oil at sea and hope prices will go up. so more oil traders are reportedly hiring these ships and all the companies soaring they are all higher today as well. >> a great pointed, we were talking about ways somebody outside perhaps, a person with enough capital to pie a tanker can play in the space, opportunities four. >> your tip of the day from "closing bell", bye a tanker. how about the other win, some of the losers a the prices ripe to buy? bringing in chad brown steep, senior ceo of rocky mountain resources. happy new year. >> happy newier. >> are you ready to step in and bye some of those companies that have opinion beaten down as a result of the collapse of oil prices. time to hit the oil services sector we all can't buy oil

tankers, a great opportunity on the institution i'll side to buy oil services businesses like which did in 2008 recreating the company at one to two times cash flow by buying their senior and junior debt that is the institutional play. the retail player out there wants to participate in what maybe the pot tomorrow you go out and find oil services companies trading at one to two tims cash flow but don't have debt that have maturities not near term. so if you find an oil services company that due toll discount in the marketplace right now that occurred many oil companies went to the service companies at the end of guest and say cut your rate buys 25%, hasn't been seen in the numbers. discount 25% and a small debt load that's a good play in the equity value market now. >> how many oil service companies have no debt? you are looking for a zpleeb practice in a pack of ponies out there, respect you? >> i think as long as you have a

company that's not more than two times leverage. so, there's quite a few out there that have proven balance sheets that have long-term horizons. you look at their customer paces, respect hundreds of them but certainly in the public markets 25 out there a good investment opportunity for retail investors. low leff ram, longer term contracts, who have already taken the pain and felt the stock price. you're going to see what we did in 2008 and you get to buy the solid performers and ride the upside. chad, just a quick question 'cause again, you got to have a strong stomach, maybe a strong personal balance sheet for this one, we have about speaking with several folks who said when it comes to the phones fallout from oil it could, because of some of the long-term obligations, high yield guys have, maybe it's 2016 shall, maybe it's beyond push comes to shove. why jump in now if we think their balance sheets could be deteriorating a lot more in the years -- several years ahead to come? >> if you look at the equity

trades for a lot of the midsize, stronger players in the oil services business they are down 70% and 70% basically assumes they are now trading at below cash flow. so they are effectively get nothing equity value in the public markets. so, he is there an interesting opportunity for those in business for a long time. if you have a stomach to assume that three to five years, still gonna be around, you're paying the bottom basement bar gain prices, like 2008. this is secular to oil. but there's a great opportunity, as long as there's low leverage. you take into account what the discount could be. so, another 5, 10 15% drop, ready to buy again. but certainly, you should start with your toe in the water here under the low levered oil service companies a great opportunity. quickly, how close are we to a bottom in oil, do you think? >> well, bill, you and i are 4-4. i think opec is gonna pull the curve pretty soon. porous rock's began nah wear out

at some point. we need to be in place to take advantage of that i think mid-40s is the bottom. so, start here and you're going to have an opportunity to make some money in the oil services sector. saying that opec is going to make a cut to output levels or literally running out of oil? >> i think it's a function of both. if you look at the porous nature of the rock which is very different from shale rock, they are flowing at a rate that $40 a barrel doesn't benefit them. so they won the battle of getting us to lay down rigs and hurting our offshore and our different onshore shale plays but not gonna lose the war against themselves. >> why are we so convinced the they are the antagonist in the first place. what if oil price dees climb for a reason we are trying to figure out and they are frankly just suffering? >> i think they took -- they are taking advantage of the situation. they played a card that we called in early november and i think the next call is they are gonna pull the curbs faster that

you or anyone perceived because long term they need oil to be in the 60s and 70s as well. so they hurt the american -- they've hurt the american company on the front of the oil gas services on the front of the drilling operators, on the front of enp players you not going to hurt themselves long term. i can imagine the second quarter, the curbs will be end and you will see a stabilization in the mid-40s. you are on the record as always. chad brown steep, rocky mountain resours. see you later. >> heading to the close, 15 minutes left coming off the highs, the dow now up less than 300 points. up 288 now. up next plenty of dproep across the stock market today, why is google lagging? that stock has been clobbered lately. a live report from the nasdaq market site. stay tuned.

a strong day on wall street. google feeling left out of the party. >> has been. bertha coombs in the middle of the action at the nasdaq market site in times square where i know our friends the "fast money" have a big event in a couple minutes, bertha. >> they do yeah. they are all behind me getting their pictures taken here gonna be i canning the closing pell. got dpoogle today, one of the

drags here on the nasdaq. steifel cutting dpoogle, saying they kind of think that some of dpoogle's growth is behind them in terms of earning growth. stocks certainly down 12% from an all-time high last year. and they note that it's missed its earnings for the last five out of the last six quarters. apple though today is really what's been holding things up here at the nasdaq. right now, it is just above its 50-day moving average. a close at these levels is really a technically strong close for apple. it's been trading about average daily volume. the real stock of the day is supply on an upgrade from deutsch pank, a price of $90. it is trading above volume levels. one of the strongest volume levels here on the nasdaq, also at a all-time high today. we are watching the nasdaq close, wanted to be at 47.36 for the break even mark for the day, but of course gonna want to watch the "closing bell," guys open up you can see they are getting ready here they are just stepping down.

the "fast money" crew sell operating the eighth anniversary on the air. always here from the nasdaq. back over to you at the nyc. much great stuff. love seeing the entire crew there. >> entire crew. >> bradley ruben, who is the manager down here. great, great stuff. that's all happening in just about ten minutes' time when we hit the "closing bell." look likes it will be a pretty strong session dow of 300 points today. >> strong day. will we finish that way? that may be key for stocks tomorrow. got the jobs number coming out first thing in the morning that will certainly set the tone. have all that coming up in a minute here. >> also ahead the prime suspects in yesterday's terror attack in paris are still at large. we will get you the very latest from paris.

all right. a gain of 295 points. art cashin telling us during the break, the buyers and sellers have paired off, go nat close, about 7 1/2 minutes here gonna hold steady around 17,879. s & p up 34 nasdaq up 83.

dan mcmahon raymond james and bob pisani. happy new year. you selling the strength buying the weakness what are you doing? >> pooig the weakness. think the market will end the year higher probably 10 to 12% what we are calling for. why? where else will you put your money. >> what was the selloff about? >> about macroconcerns a all right coming out of europe a lot is tied to commodities people correlating weak commodities to weak demand obviously. if you look historically, very little historic correlation between crude and the market. it was just kind of you know, there was -- let's not forget where we came from either people taking chips off the table to start the year. >> make 2015 more some tile? this is the third pull back we have had since september and all three of them now have been v-shaped rallies. >> already anticipating a much more volatile market in 2015. pie even given the strength 2014 historically a very little -- had very little

volatility relative to past markets, looking for more and a play significantly more. >> the earnings picture is what i'm really concerned about because we had good news from retailers today, a number of them raised their earnings estimates but they have been war is dar offed by the declines in energy estimates that we have been seeing. >> i think that a lot of the declines in energy are anticipated and the dedplins energy represent a tax holiday, if you will for the retailers, particularly the low-end retailer, the fast food markets, those people with less discretionary money. so, these not a surprise. the real surprise is nobody is talking about earnings. >> yes, that will start next week, right? we haven't had any down grades at this point. we will come back with the closing countdown, see how we close with the dow, back up 300 points. after the bell preview tomorrow's closely watched jobs report. what it could do to fed policy plus find out why yale economist steven roach is so worried about the fed leading us down another path to catastrophe. there's that word again.

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90 seconds left. let me show you the dow today, continuing yesterday's rally. held on. we have those jobless claims to thank look good. retailers, as bob mentioned had good numbers from the holiday season and we are finishing here with gain of about 310 points. puttings back into black for the dow for the year. the other interesting market crude oil, wti, what was that

button hook late in the day? look at this thing, just near the close and then as soon as the regular session closed, the electronics session took over and rallied and put them back almost up 31 cents on the close there. what is a number we should look for in jobs tomorrow do you think? >> 243 the current estimate a lot of people were debating if we get the number in that league, is this good news? i was concerned about evans last night think rates should stay low longer and the market moved 15 points. that tells me feds still really matters to this market. >> 100%. still at cheap money. still a liquidity-fueled rally, if you will. everything looking pert in the economy. starting to see jobs numbers coming in good strong demand from the consumer housing market strong love the hope trade heading into springtime. but again, you have to throw out a lot of historic data because we are dealing with free money, basically. all right. dan, good to so you. don't be a stranger so often. bob, thank you. as autopsy, we are going out with the 315-point gain on the industrial average.

thesome & p up about 35 much the nasdaq, a very strong 86 points. a reminder we wish a happy anniversary, number eight, for our friends and colleagues at "fast money" as they ring the "closing bell" at the nasdaq market site. and i think, kelly it's safe to say that for viewers who watch cnbc to figure out how to make money that's the kind of shock the traders, the smart semiguys that trade there give them an opportunity, just that don't they? >> they certainly do. they certainly do bill so nice to see everybody there. from the producers, again to the crew, there is mark hoffman in the back ground nick to the left as well and many many familiar faces to people who batch this network. human cop graduations to our bowed disup at the nasdaq on "fast money." even better get to hear a whole lot more from them in just about an hour's time. welcome to the "closing bell", everybody, i'm kelly evans. what a session we just had on wall street. been a roller coaster so far this year all of those, what

four or five sessions we have had now the dow going out with a begin of 320 points. the nasdaq going out of 85 the s & p, adding 36 points, games 1.8% across the board. get right to it with today's panel, joining me my guests. kenny polcari will be joining us from o'neil securities for more on today's trading session. knee jerk thoughts you guys here as to what this is all about. is it oil, the ten year? what's driving the sudden optimism? >> so interesting pause we ended the year on a high and we had oil at this low level and things seemed to be pretty optimistic. we have had quite a volatile start and as of today, we are just about out zero with jobs numbers starting first thing in the morning. so i think this is going to be a really important start for us. >> a really volatile ride this year. what we have noticed is over the past very short term crude oil and the s and p futures really tracked each other. see oil dealt pert things dealt

better. today, interesting things started happening, this large cap check lead the rally. everything was strong. noticed some of your old school tech names very strong today. >> i was gonna say. difference teen large cap and old school. google wasn't leading this rally. >> talking big hardware names, names left for dead, people looked the them two days ago, niedermayer, dead. back, right in the flow. they are good. >> robert? >> really excited about the consumer right now. not just what's happening with oil price, gas prices, but also look at how many workers gotten a increase in the minimum became as of january 1st because 289 states cities states had increases in the minimum wage. 3 million workers are gonna get increases in their salaries. so, that's really big. so far, with hef a recoffees are i for capital. now, a recovery for the consumer and seeing that with autos, seeing that in retail seeing that with where they are putting their gas money. >> we are going get into much more as well on the consumer and middle class in a moment. want to welcome our friend

kenny polcari, fresh off the floor from trading and art cashin joining us from ubs. hi to you both. art, first to you, you were talking all day about the correlation between oil and between stocks. frankly, i would more encouraged the market moved higher while oil is moving lower, seeps we need a pounce in oil for that to happen today. >> primarily will stabilization of oil. as long as it doesn't look like it is going to free fall. bill earlier noted right around 2:00 we had a little down draft that i sent out a message about that if we got much past the wti minus 75 cents, it would put pressure on. go the there. started to put pressure on and then it came become into plus territory and that allowed the market to go to brand new highs for the session. the other two factors were drag hi saying he might wind up pieing sovereign debt that helped out a little. of course as everybody noted charles evans last night saying an early hike in rates would be

a catastrophe. it all came together. that is for. kenny, the question remains for the market does oil need to keep rallying for the market? >> i'm on the other side of that fence, not necessarily sure -- i don't think oil need tosco lapse, for sure. oil stabilize right here and finds a base and churns aly, the market is good. i think the movement on the market was much more driven around greece germany coming to say they are ready to talk to greece. ecb, certainly evans, i think oil play is a subplot. >> you have to admit intraday correlation is very strong. >> is, absolutely, but like the last couple of days everything was negative threw in the negative oil story. the minute they turn positive throw in the positive oil story. depending which way you want to argue is the way you argue. fair point. >> very true. one of the things so important is we have this wonderful benefit from oil getting lower. exactly. >> everyone was so excited about it t and the moment they thought, ah could be in trouble. you know what you look at the big oil state one of the

largest concentration is north dakota, right? texas is a little more diversified. you know what else north dakota is? also the state with the lowest unemployment rate in the u.s. >> right. >> the fear of, oh lose all these oil jobs, a little overstated in the market. >> i like to talk about -- listen, oil is trading at $48 a bar approximately and the market is making new highs. when oil was trading at $100 a particle, the market trading down. >> what about the first couple of tradinging ises of the year? >> write think the whole european story, i think. more greece and ecb. >> art cashin who would you agree with or what would you agree with here? >> i'm sorry? >> what would you agree with in terms of the correlation for the mark sets in oil need to rise going forward or are we overplaying the importance of that? >> it only needs to remain stable. the idea that oil looked like it was in free fall again to raise questions about russia defaulting, other nations defaulting. and again, the impact on capital

he can spend chur in the oil industry. you saw u.s. steel shut down a couple of tubing plants put 700 people out of work. those were the things that have people bothered when oil looked like it was in free fall. it only needs to remain stable to provide some balance for the market. michael block? >> the thing that we have to keep in mind here we have situations like tuesday morning when everyone was like going right for the hills, u.s. steel is laying people off, oil going to zero, going on like that the thing we got to over and over again, the central bank is alive and well, living in washington,s wereles, frankfurt, whether we like it or not. do you don't have to like it but say, hey look guys putting their hands up, saying everything will be okay. >> everybody is saying this is so great for the economy, the federal reserve ultimately will have to respond it a strong economy so that wouldn't mean the put is in place. >> strong economy. what does that mean? what is the fed afraid of? raise rates and people will stop shopping at costco? i don't think some they are afraid that brazilian exchange rates will go haywire and

liquidity crisis in emerging markets. they are scared to death of this. they don't know what they are doing. >> one of his predictions for next year, wasn't one of his official ones an atestimony dumb is watch brazil. thinks rowself will come over with some more business-friendly policies that's a police like some emerging markets, that benefits, in fact from lower oil prices. >> what happened in those markets today, right, all those emerging markets, etfs rocketed higher. >> everyone left them for dead. >> exactly. >> everyone has to tell themselves, tuesday morning, don't get caught caught in the down trap and buy the consumer stocks hurray lower. everybody has to buy those stocks. >> never underestimate the power of the american consumer. they always come back right? >> like warren buff felt says be greedy when others are fearful and fearful when others are greedy. much watching gore the indexes, do you think the volatility continues or things settle down? >> tell me what oil's going to do? i think if oil remains relatively quiet, it's type.

we have a couple of flashpoints coming up drag hi supposed to put together a plan. there's some doubt whether they can actually pull off a real qe. that could be a problem. we will have to see how this terrible event in france begins to shift the political winds in europe. democrat nah see a lot of those elections swing to the right and that may not be favorable to euro. so, there are other geopolitical aspects that could provide volatility. right now, oil has been the one. >> when do you guys think it shifts if it does? robert, we have davos in a couple of weeks. we know it's going to be all about europe. we have the ecb meeting shortly thereafter in which mario draghi has to come up with something, all indications point to him doing so. does that start to take center stage, whereas right now it's up clear if it's the main drive? >> i think it is center stage. when i talk to the really wealthy investors who have a lot of money in this market they basically said look the federal reserve and quantitative easing has become globalized. so whatever the fed does

you've got drag hi, got ave, not going to go much higher in the next three or five years. once you have that background music, you can keep dancing. kenny? >> i think -- i think he is absolutely right. and i actually think quite honestly, i think the market as long as arthur said as long as oil stabilizes doesn't need to rock it out, needs to stage ichlz. >> what about the jobs report tomorrow morning, what does that have to report? >> the jobs report is a little overdone looking for plus 240. >> think it is now more about inflation then? what one of our other guests said? >> i think it will start to be more about inflation but going to have to be -- people watch and see what happens to wage pressure, right? what are we seeing in the wage bucket? haven't seen that pressure yet. >> we will see that tomorrow. finally gonna get some -- >> do you promise? >> we are. we are going to get some god information tomorrow. and i think one of the things that's really important is we have a tremendous spread. for all the times that i've watched the jobs day you know looking at the numbers, everyone talks about the numbers. this is one of the widest ranges

of estimates that we've ever seen. so, there is an awful lot of controversy and debate amongst economists now, what is tomorrow morning's number gonna be? >> article carbon do you want to offer a prognosis for the morning? >> oh, no interesting, hearing people talk about a major revision of the big number we saw last month. we will see. >> that's definitely something. i love that the ahhst. art cashin, thank you so much. kenny polcari, a pleasure. thank you. a megarally pushing the dow and s & p into positive territory this year. will tomorrow's all important jobs report send the market back toward record highs and what will the numbers say about the health of the middle class which has seen some troubling wealth stagnation. going to talk about that next. later, we will hear from somebody who says the next crisis will be the fade fault. steven roach laying out the catastrophic scenario he is fearing later on the "closing bell." you are watching cnbc first in business worldwide. nohidden fees on savings accounts? that's right. it's just that i'm worried about you know "hidden things..." ok, why's that?

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welcome back. time to hone in on the u.s. consumer, despite a steady addition of jobs, each moment, unemployment rate below 6% not everyone is convinced the tide is lifting all boats, that includes senator elizabeth warren. last hour we heard her take on wall street. today, she had this to say about the entire u.s. economic system.

for more than 30 year too many politicians in washington have made choices that favored those with money and power and the consequence is instead of an economy that works well for everyone, america now has an economy that works well for about 10% of the people. >> reaction now with our steve liesman who can preview tomorrow's jobs report and wage growth and our panel. steve, listen she said this only works for 10% of the u.s. economy, reagan's policies failed, frankly, the economic system is a failure. what do you say in response? >> i think that's simplistic way to look at it and i worry about senator warren using those kind of populist ways of looking at it it's complicated. i think there's more that we can do to help middle class folks, especially lower middle class folks in this economy. i think that has to do with education, has to do with a variety of ways we can help bell lift themselves up, i think calling the system wrong is

probably putting it in the wrong place. for example, when you look at the effect of globalization, what do you do with that? close our borders? >> right. the number of twice criticize what she said i think is too long for this segment. but i think looking at the system and what you can do about it is probably worthwhile. painting it with a build brush is overdone. hold that thought, in jermaine news, we have earnings here special sive cloimt u.s. consumer. just a quick update with our morgan ben.. what's happening, morgan? >> check out macy's, moving lower in the after hours, going to close 14 stores and restructure its merchandising and marketing unit going to save $140 million annually beginning this year. 2200 positions will be affected by those moves. the savings will be reinvested in tech noll talent and business. the company reaffirmed its earnings guidance the stock currently trading down 3 1/2% in after hours. pack to you. >> morgan.

thank you. guys and steve and everybody and diane, i know you have been strong on this that em the middle class finally enjoying a more prosperous year this year. we have news like a macy's is this pressure from revive jcpenney which had strong numbers? >> very good point. >> overstating perhaps the positive benefits that came from the collapse of oil price? >> missing something really important. if you look at macy's numbers today, they actually had 2.7% increase in same-store sales. so some of their own products they have a tremendous increase in sales. so what this shows us when they are doing this type of restructuring, is that really if they are in a disruptive industry right now, we should not expect the old brick and mortar stores to continue to do well in their current business model. a lot of what we are seeing is restructuring, lead to job losses in some place and higher ed opportunity in others. >> if you want to buy consumer on either the ideal of middle

class making a come back or on the drop in oil price, you have to be pretty selective here. >> that's just it again, the time to buy is tuesday morning, the time to buy these stocks is in october. i'm looking it he macy's chart now, that bar was really high. this her going to announce something, people are going to say forget it. the game here everyone gets short, stock muddles around, pull pack in when you buy the stock. >> what is your take generally on the buying power of the middle class and their prospects right now? >> i like the middle class consumer here. now, i know we are going to talk about house and housing, i think there are challenges there, some of those are structural and regulatory, but actually am a big believer in the middle class consumer here thinking about stocks like macy's or the restaurant stocks or some of the food and staples stocks which, again, another story in terms of where they are trading, also bar is very high. >> right. bunch big believer in the u.s. consumer, a lot comes back to the strong u.s. dollar here. let's don't underestimate that purchasing power getting them what happened it really means here. before we go back to see robert what was your reaction to the comes from elizabeth warren? >> steve and i have had

interesting comments about the fed's role and inequality. steve, she is right, you look at the numbers, this has been a recovery for the 10%, even for the 1% for the .01% pause they have had the financial assets which have driven most of the wealth increases in this country. but i think you and i also agree that we are starting to see some signs of strength in the consumer and the middle class, even though that data's sort of backward looking. do you see signs of this? do you expect signs? >> i do. what you had if you think about it a very long and slow and anemic recovery and the rule of that has been very slow job growth, up until about the last say, ten or 11ment moss we popped above this 200,000 level and what we see is we see sporadic wage hikes, see wage hikes in places where there aren't qualified workers, but in general, as the job market remains strong as 200,000 last month, 300,000 jobs created, what you do see is somewhat better job growth where you need to be if you want to see

better wage growth is better job growth. and that's the key i think, i think that's what we are seeing an getting. >> one interesting question, as we, 2006 elizabeth warren widely touted as a candidate for the democratic nomination this is her narrative, she is running with it it is going to ring as true a couple of years' time as it does today? >> i think right now, one of the things that's really important is lots of people have anchored themselves to pre2008 crisis and if you look at what's happened the middle income families are still roughly 35% below their household wealth whereas high-end income households are about 90% back to where they used to be. as time pro-dresses though now we have low -- certainly have low inflation, right? we have some jobs growth finally coming in steady right? 57 consecutive months of jobs growth and low oil. all that bodes very well for the middle class. i think what we are likely to see, in the next couple of month, midincome finally making up starting to feel better and,

you know largest asset is housing. >> kelly? >> steve? >> i want to weigh in on this and engage robert frank, part of the discussions that we have, a couple of cubicles away from each other. and i think the central question when you got get to a comment by elizabeth warren is the wealth of the wealthy at the expense of the middle class? and i don't think there's any evidence that shows that robert and i did a series a couple months ago pointed out, a lot of the work that robert did as well, let him take the details on this but the wealthy seem to be getting wealthy for their own and the middle class stuck with their incomes for reasons that seem disconnected from what's happening with the wealthy and that's where the real critique of elizabeth warren comes in. to wrap it up steve, i think the focus shouldn't be on inequality, about keeping one the bill gateses, doesn't make sense but helping the middle class improve opportunities so those people have the same on tune thes that i we had 10 20 30 years ago. >> michael, just in a word again, bring this back to

investors, looking a at name hellen of troy beating, rallying, five below missing, falling sharply, macy a he is restructuring. jc penny surprising results gap. what is a person to do? how selective and how do you figure out who's going to win in this environment and who is not? doesn't seem to be a case about the middle class at large but something different going on here. retail stocks their own animal often refer to investors in that sector as the consumer mafia, the retail mafia. the mafia is having their version of apala can a next week, in orlando at the icr exchange, have 150 different companies telling their stories to this group of investors and shuffle around to meetings back and forth. you will be there? >> i will not be there i used to go there. it's a good time. like when the five families get together. a five families. you like the chicago new york hedge funds, the connect, the long island. you know. all get together and about cement.and stories. we find that's specially in this consumer space, there's a lot of fellow travelers where if

everyone short macy's into print and sure enough the print is bad, magically see the stock go up. look what happened with macy's urban last time same thing happened. one where you watch cement.more than any other sector. >> fair point. guys, thank you all. very important discussion. steve, thank you. our steve liesman become at headquarters. be sure to tune into "squawk box" tomorrow, steve will be sitting down with chicago fed president charles evans, he of the comments last night that some are citing for this markets a rebound today, an exclusive interview, again, 8:40 or there s eastern on cnbc tomorrow morning, chicago fed president, charlie evans, with our steve liesman. france in mourning after yesterday's massacre at a satirical magazine publishing karen it is a of the prophet mohammed. more on the manhunt for the suspects in this deadly attack. stay tuned.

welcome back. tops of earnses an lot to touch on the consumer theme. send it to morgan were enen for an update. morgan? >> so bed, bath and beyond just came out with earnings after the bell and the stock is falling on those third quarter reports, mixed earnings the real story comp sales, 1.7% weaker than the 2.9% the street was expecting, seeing that stock trade down about 5% in after hours trading. another one to watch, specialty retailer five below, also falling, after it issued a fourth quarter earnings and revenue warning. five me low trading down about 13% in the after hours the. back to you. a human move for that one.

morgan for now, thank you very much. it's day two of the search for the terrorists responsible for the deadly shootings a at satirical newspaper in paris. cnpc's headily gamble with the latest. any update on the manhunt? >> reporter: essentially, what we are watching is 88,000 security personnel scouring france for these two men, two suspects, most wanted men in france. we understand they have tracked them to a forest in the north of france about an hour and a half outside of paris. that is all against the pack drop of national day of mourning. just a couple of hours ago saw the lights of the eiffel tower dimmed in support of the victims who were murdered just a few blocks away from us yesterday. the same time we have also been through a moment of silence. earlier today, traffic came to a stand still in 35r ries in support of the victims. crowds gathered for the second day at the place derepublic. seen president hollande coming out, said there will be justice

for the victims. one note of definess i can't, the magazine that was targeted in these attacks has announced on their website that they will be publishing a special edition, 1 million copies in the coming days and the message, one of defiance and it is we are all charlie. >> hadley gam pell. thank you very much. understand they will be doing 1 million issues 1 million copies of the i shall a you of their next magazine. and joining us for insights on this story dave vitt katz ceo of security group and former special agent with the dea with our panel. david, welcome. thank you for having me. >> one thing caught my eye the remarks, the extent you think this wasn't as sophisticated preplanned attack as some are characterizing it. >> a lot of people made a lot to do with they were so professional, they were commandos. i would say they are familiar with weapons. i would say they are no stranger to killing people. they did display a relative bit of calm when they left but they had no escape plan.

they left -- i heard someone suggest they might have left them deliberately, i doubt that. of get, their get away scheme was not in any way, shape or form thought out. they probably had a little pit of intel. this he do know how to kill people, i wouldn't classify them as commandos. >> this become relevant pause going back to the chronology again, with it being very unclear right now how much to conflate these, there was a tweet that came from the magazine 11:28 local time, the siege began at 11:30, possible it would be a reaction to a tweet or too short? >> probably was co-incidental, i would guess. they did seem to have good intelligence. i don't know coincidental an editorial meeting that day, but that could have been on social media, never know, but they apparently had inside information and chose a very specific time to hit them. >> you specialize in protecting executive and protecting commercial office properties. what should have been done differently, if anything in this case? >> to be very very honest here in this structure, you have

meaningful security. you have guards who are professionals, former law enforcement, former in i will tary. go in in i high ride office building in new york city you will find an unarounded guard, they may be fairly well trained but not able to stop men who are armed, trained and carrying assault weapons. not gonna happen. absent having the real serious people like you have here you're not going to be able to stop that >> one of the questions i had is how this would have played out determinely on the streets of manhattan. obviously, france on the one happened, you have got very few you guns in the hands of civil qualms much the other hand much more police presence armed police presence in new york and -- but less crime generally, violent crime and the streets of france. i was sort of surprised that these guys did get away and have get within caught. you said they are not sophisticated, but still out there. how would this have been different? could they have got.awine the streets of new york? >> their apillity just anyone who has driven in midtown

manhattan knows your ability to go anywhere in the best of circumstance. you are not as able to move around freely, to be honest with you, the new york city police department is far better trained or more well prepared for this type of thing. again, a lot to ask for a patrolman, for example, armed with a happened gun to go against two guys about rifles that's a tough ask. >> are you confident about that and what about other cities as newspapers in this country have printed car tops that charlie previously ran? what kind of measures should they be taking at the company level or at the municipality level? >> the easiest thing to do this is no possibility that companies across the country are going to put serious armed individuals at the from the desk. not gonna happen. what you can do you can harden make it more difficult to get in locks, turnstiles, do you have something an impediment to access. the idea is to delay, by that time, if you can detect somebody trying to get in you're calling 911. new york city i promise you the

response very robust in a situation like. this without -- without, i don't mean to disparable in any way, shape or form the brave men and women in paris, we have some very, very talented aggressive police officers shots fired, go toward them and take care of business. >> david, thank you for being here with your perspective, david katz formerly of the dea. >> welcome. >> much more "closing bell" when we come right back.

welcome back. begin with more updates from morgan were enen. hi morgan. >> just keep them coming here. another consumer-centric name to check out hellen of troy those shares are moving higher in the after hours after the consumer products company posted better-than-expected third quarter results. the stock is currently trading up 5% in the after hours. back to you. >> all right, good stuff for now. thank you. many investors watching the fed this year anticipating a rate hike at some point. but quietly hoping it won't happen. now, my next guest thinks the fed isn't moving nearly fast enough and it could be very costly for the entire economy. joining me now, yale university senior fellow steven roach. steven, good to see you. welcome. >> hi, kelly, how are you? >> last night, charlie evans at the fed used the word catastrophe with regard to the fed raising interest rates in this environment potentially. you use catastrophe in a very different way. >> i just go back to 2004 i just

go back to 2004, 2005 and six, the equity markets, credit markets will toad huge distortions in the real economy. when the buschles pop, the whole house of cards came down. the fed hasn't appreciated the precedent of what they put the world you there a decade ago and i fear they are doing it again. >> what is the message from the 30 year being basically at 2 1/2% and falling as the economy improves? >> i think there's a lot in the bond market. it really has no inclination of

being aggressive on normalizing you interest rates any point in the foreseeable future. >> the same point that same curve, the short end is pricing at a 1% rate two years out. why would it simultaneously believe the fed and doesn't believe the fed is gonna move. >> what is 1%? is 1% gonna restrain the economy? absolutely not. >> there is there such concern on the longer end of the curve? >> the long end is a compilation of aggressive increases across the yield curve and short-term interest rates, largely being angered by a fed that says it is going to move very slowly if at all in normalizing interest rates. if anything, the fed is going to disappoint us the expectations insofar as to how much it adjusts rates upward this year. >> what about macroprudential tools? i'm guessing you're not a fan? the idea if people aren't fam kbrar, using the blunt tool

some call it of interest rates, generally look at an area like the housing market biotech stocks, like certain parts of the load market specifically target them either through those adjectives or policies and help to normalize and keep the -- >> this is the new buzz word that came out of the crisis, largely because the fed circled the wagons around monetary policy and said we have nothing to do with the crisis. what we were lacking were regulatory tools, now macroprudential tools, let us address specific excesses in the financial system and give us the po you are to do that and make sure this crisis never happens again. meanwhile, they leave the fed funds rated zero it was 1% a decade ago and they are in total denial that cheap money, a accommodateive policy price risk, had anything to do with a catastrophic outcome of '08 and '09. yourious given your global perch

what you think of the stronger dollar, up about 10% and this is traditionally a tool for title titleing policy, so sometimes when i hear people say the fed should raise, the fed should raise, the fed should raise, has the dollar effectively raised rates, we don't think about it or lock at it that way? >> i think that's good question the dollar is a relative price. this is one area where markets are looking at the u.s. as the proverbial, you know, dad house in a pad neighborhood. this foss concern me undermine any import led growth which the u.s. needs, give the ongoing sluggishness of the american consumer. >> right. an area where other countries are happy to jump in if they see an opportunity, as we talk about perhaps risks or opportunities, generally speaking do you think china, for example, is a still a growing economy or slow precipitously and concern us all

or other risks outside of fed policy and is that what it's all about? >> i have been pretty optimistic consistently. on china, i think all the fears of the hard landing are overdone. china slowed but strategically. >> i asked today pause we had the first default of offshore bonds held pie a property company in china. not dealting a top of attention, certainly didn't trouble the stock market today. but a sign that all is not well. >> china need dees faults to validate the notion it is going to a market-based system. if it continues to disallow defaults from occurring, it underwrites the biggest moral hazard issue that's left in the markets. china's adamant about going to market-based systems defaults lord, this is one of them. many more to come and i think that is an indication of growing

health in a system that is going to expose itself to every market-based pressures. >> the catastrophe is not raising rates now? >> i think the fed needs to be more disciplined, what a central bank is supposed to do the fed is being dragged around pit mark else and is fearful of disturbing market sentiment rather than doing its job. it's a stewart of the -- steward of the real economy. >> always great to hear your perspective. thank you for being here this afternoon. really appreciate it. coming up you shall the white house making a move to bring more first time home buyers speaking of the financial crisis, into the market by lowering mortgage insurance premiums. next, i will be joined by an industry pro who says that move will light a fire under the cooling housing market just in time for the spring sales season. the question though is whether it will lead to an avalanche of defaults on the taxpayer dime this time around. and investors maybe excited about this big two-day rally not nearly as excited, there he is steve balmer last night. find out what got him dancing like this, coming up on the "closing bell."

welcome back. another earnings update. here is morgan were enen. >> another retailer to check out and this he is the cop tainer store. the stock moving lower in the afterhours after the company reported third quarter revenue that came in below street expectations. it also gave weak revenue guidance for the fourth quarter. that stock is currently trading down about 6% in the after hours. kelly, pack to you. >> all right. another one to watch. another big box store under pressure after hours. the president speaking earlier today announcing lower cost for home buyers that need mortgage

insurance. take a listen. starting this moment, the federal housing authority will lower its mortgage premium insurance rates enough to save the average new borrower $900 a year. that's $900 that can go toward paying the groceries or gas or a child's education. >> boy the way, home buyers are certainly reabling -- home builders, i'm sorry, reacting positively. help first time home buyers who had a hard time entering the market as well. sherry olafson, founder of the carp neg guy group joins us with brian cost executive vice president of mortgage network. welcome. sherry, do you think this is a prudent move if it ultimately has the fha winning share back from other providers of mortgages or is it gonna grow the pie generally do you think? >> a little bit of both kelly.

insurance premiums need to be priced to risk and we have had today's biers eventually paying the dues for 2004 home buyers in terms of the premiums. it just has not opinion priced to risk. the other big issue is because of that anyone who could have has that been seeking a loan from some place else less costly alternative and so fh a's quality of their loan pool in general has been dropping. into the going to see a difference the premiums are higher than the historic norms and the tough pay the premiums for the full life of the lope which makes zero sense. a >> a couple ways this matters. 4% mortgage rate, the insurance has until this change been 1.75% on top of that for a one.-time up front fee, combined with an annual premium of 1.35%. the annual premium drop to 0.85 but still talking about, you

know, everybody says mortgage rates are so low, you add those together it is more significantsome that keeping first time home buyers out of the market? >> dropping by a half a percent. average home price is $200,000. really only about $$80 ament mo. not going to have a huge effect. more of a emotional effect. you're seeing a drop of a change in credit risk and credit cost for fanny and fred ditch. >> diane, you are shaking hur head here. >> i cannot help to think to myself average mortgage payment in the united states is around $1,0550, right? this is going to give people $900 a year. this is a entire mortgage payment going to get taken care of. >> do you think -- even though you understand that as an economist, do you think the average home buyer understand what is a benefit this possibly can and will be? >> i think they understand it in

the same way when they get their paycheck every two weeks, every few years, they end up getting that extra paycheck, right? they plan ahead for that what are we going to buy? here comes a new living room right? i think with this type of benefit, i think they are gonna see thatted a be willing to buy more expensive things. >> wondering whether it's right for the builders to have rallied as much as they did on the news become 5% again, just to go back to this note here from alec phillips saying maybe this is going to be an additional 14,000 housing starts on top of the rate they were expecting, really gonna make a difference? >> i'm not a buy of housing. i think had is good news. the question is how good is it? the consumers see the benefit. panks see this and banks going to perhaps loosen some of their lending standards a bit to really drive that bus? >> what will drive the change are enhanced credit and underwriting criteria seeing the rules of those. that is what is going to making

the lending community more comfortable and a cumulative effect here. you mentioned the 3% loans that fannie and freddie are introducing. also begin to make payments back into affordable house. the i shall a you that we have facing this nation now is not foreclosures and defaults or negative equity it is affordability. when i say that, i don't mean for folks on welfare, i mean for teachers and formen if we don't start doing something now, to start creating more units because none of those units have been built during the crisis or the years that followed and if we don't start making credit more accessible for them we are going to have a major problem. >> go ahead, brian. >> kelly fha is the most flexible product for qualifying for the first time home buyer, which is the segment that we have been missing the most in this sluggish housing recovery. >> is there a role for the private sector to play instead or simply out of the question? >> the private sector has been taking away the cleanest loans away from fha. so really fha had to make this move to billion out their book. but all in all, i don't see this having a major affect on the economy.

it's more of just a change in tone. buyers can sense that. >> quick last word, sherry? >> this is also sort of the tip of the ice persian gulf. the president released a six-page press release today, there was only a small paragraph dedicated to the rest of this. once we get to the state of union address at the end of the month, wither going to be hearing lot more about controversial issues with a republican congress now like dse reform and unrolling dodd frank, those types of things. we will see a lot more of that. >> sherry and brian, thank you both. appreciate it this afternoon. >> thank you. we keep an eye on the housing sector. if you know anyone who has a pension, a new round of some pad news that story burning up our website and see if it made the hot list next. .to, the all-important jobs report is out 8:30 a.m. attorney time. how will that impact this stunning market rally? don't miss the coverage on cnbc and "closing bell." we are back in two. on. ahhh-ahhhhhh. liberate your spine... ahhh-ahhhhhh...aflac! and reach, toes blossoming... not that great at yoga.

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pensions in trouble always gets people clicking. the managing editor joins us now. what's in trouble now, alan? >> well we've got another survey taking a look at pension funds. and guess what, they're 80% of where they should be. that is $343 billion with a "b," that they need to make up. apparently the liabilities are growing even though they had a great year they're still, you

know, on the hook for a lot of money. our readers keep that up. 66,000 people. >> this is the real effect of the drop in interest rates. >> exactly. because it effects all of the pension calculations at the same time people are living longer. now, we had the macy's news. people jumping into that story this morning. the jc penney store closings 40 store closings that was my top story this morning. now, macy's closing 14 stores. wet seal was number one story yesterday. finally the gas tax comments from john boehner, speaker of the house, saying probably doesn't have the votes to pass. people jump into that story, too. those are my three. >> i'm glad you mentioned it. the gas tax sounds like it's going to get a little more support here. but readers on the website i'm assuming are overwhelmingly opposed to this aren't they? >> certainly. any time you talk about, i'm going to tax you, people are against it. even though you know it kind of might make sense right now. a big highway bill that makes money. >> be careful.

they're going to come find you. >> come on, folks. >> i'm going to see your team feels about this. good to see you, alan. steve ballmer, enjoying the second act in life as owner of the l.a. clippers. court side at the staples center watching his team. and we'll tell you what exactly prompted this display when we come right back.

when billy idol sang dancing with myself you think he had this in mind? here is steve ballmer courtside last night. fergie came out for a surprise concert and the new owner of the clippers couldn't hold back his impressive dance moves. i have to say, guys i love it. >> i am glad you cleared that up. for a moment i thought, my god, is that chris christie? >> well -- >> i've seen a lot of -- i've had the unfortunate experience of seeing a lot of billionaires dance before. he is the best. look at that. i love that. >> has all the moves down. >> when you pay $2 billion for a basketball team you can do whatever you want on the sideline. >> spend time at arthur murray. look at that. >> no.

actually, this -- i thought this looked familiar. i did a little research on this. these moves are straight from a cartoon. >> oh, there we go. >> that was the afterparty dance. >> yeah, exactly. steve ballmer, turning back to markets, speaking of microsoft, you were talking about some of the big camp or old camp tech names lately. give us the interesting trades for the new year. >> look when we were plowing the depths and broke some key support levels on tuesday morning, i put my flag up and said hey -- >> white flag or what flag? >> no, everyone else had the white flag. i said i'm buying stocks here. we've had a nice run from there. i want to see if we can rechallenge those late december highs. i'm riding that right now, but -- >> are you collectively buying or buying the index? >> it's a few things. buy the index, but other ways to play it you can buy tech stocks that look good. i was buying consumer stocks. i was even holding my nose and

looking at the coal and energy stocks. look, that's a trade. not an investment that's a trade. you have to let things wash out. i'm going to trade those both ways. keep your feet moving. that's what we do. looking to see if we get continuation. if not, we're going to go the other way. >> how important is tomorrow's payrolls numbers in all of that? very important? slightly? >> i think it's going to be supportive. i can't see a scenario where it's going to have a big effect on anything. famous last words. we'll see about that. if it's strong we'll -- >> what's strong going to be tomorrow, diane? >> anything north of 285, i think people are going to say, oh, okay. >> that's a high bar. >> a strong number. the estimates go as far out as 305. >> wow. robert? >> you've got to watch europe. it's satisfying to talk about american exceptionalism and how great we are compared to everyone else. you and i both worked overseas. it's really not looking good in europe. that's going to be the one to watch next week. >> great points by everyone. thank you so much for being here this afternoon. really appreciate it. we do have a big day coming up

tomorrow morning. the u.s. jobs report released 8:30 a.m. eastern time. there'll be our steve liesman's exclusive interview with charlie evans. that does it for us on "closing bell." a special edition of"fast money" is coming up next. tonight, a "fast money" first. all eight traders here onset throughout the hour bringing you their best ideas. our special anniversary show starts right now. >> tonight, eight years of "fast money." >> that's a major number. >> from the fiscal crisis. >> it's as tough as i've ever seen. you'd be lying not to say so. >> to dow 18,000. from the first iphone release. >> momentum in the iphone has never been better. >> to smartphones with a success. >> now it is bringing thermal imaging to iphones. >> and 3d printed dinners. >> this is amazing and it tasted grea