>> that's where the disagreement is. >> what's that country song it's just you and me and we just disagree. >> that's us. >> salesforce.com out with earnings. cramer has an exclusive with the ceo. >> we look forward to the show. and "closing bell" starts right now. welcome to the "closing bell," everybody. i'm kelly evans here at the new york stock exchange. >> i'm bill griffeth back where i belong as well. >> y a. y! >> the dow turning positive today. the blue chip index is back on track to close at a new all-time high again, post its first five-day win streak this year. meanwhile, the s&p also right around its all-time highs at this hour. as you know anything can happen in the final hour of trading. you want to stick around for that. >> also, former fed governor

lawrence lindsay saying we could see a bond market tantrum if janet yellen and the fed don't raise interest rates. >> a new study finds companies may be buying back stock at a record pace. however, corporate insiders are not. that's interesting. coming up we'll discuss whether that's a sign that executives believe stocks are starting to become too expensive right now. >> watching the insider trade. here's what we see, right now with an hour to go the dow is up 16 points. buffeted by earnings today. the s&p adding about 4 points. nasdaq up 19 bill as we continue to get the pulse of the u.s. consumer today. >> let's get to what's going on in the world today in the world of finance. our "closing bell" exchange with some of our favorite people jack bouroudjian, keith fitz-gerald from moneymorning.com. susan fulton from fbb capital partners and our own rick santelli. rick, i'll start with you

because the markets response is interesting, maybe instructive. after the minutes came out, nothing happened. and in fact the dow is in the midst of a very narrow trading range for the last four or five trading sessions. the first time we've seen that this year. what's going on with this market right now, do you think? >> listen i know that there's all the issues of what's going on with first quarter gdp seasonality. the market doesn't seem to be too dissuaded from the notion that the fed isn't an issue in the near term. you can argue that the minutes say that. on one issue in particular, i'd like to put something on the screen. with regard to larry lindsay, the fed on page eight of the minutes talking about the volatility we may experience during normalization said the following, increased roll of high frequency traders, decreased inconvenientventoryies and

elevated bond funds. all of those conditions are the unintended consequence of the fed's own policy. if you have a boat that's leaking, drill holes to let the water out. i don't know. this is very fascinating. it's going to be a great chapter of financial history to live through when the fed finally does a one and done to see how the markets act. >> i'm glad rick brought it up. a lot of folks, the fed included are focused on fixed income markets and how they might react. what do you say to people out there who are invested in some of these instruments? some of them equity-like. >> you know i think it's be careful what you ask for, you just might get it. this is the path to normal normalization normalization. whether we like it or not it will be messy and volatile. i agree with rick when we were talking about it. i mentioned it last week, some of the liquidity we're seeing in the bond market. one of the ancillary effects of

that, we're seeing the rotation taking place. guess what this is a breakout. when people go back and do hindsight analysis they wonder where the breakout is. this is the breakout. this is the buy in may scenario we were all talking about and more than likely would last to the end of the year. >> keith fitz-gerald, i think you agree with that. you've been staying the course anyway. we get headline risk out there, the weakness in the economy in the first quarter, until this week housing seemed to be in the doldrums still. you've been advocating hang on to your quality blue chips, right? >> absolutely. 85% of the buy/sell decisions are wrong. headlines are usually wrong. the more extreme, the better.right now the fact that we have lots of doom and gloom stuff in the headlines, yet we have an accommodative fed. the bondette is absolutely the buy product of the fed's manipulation, so are equities.

the path of least resistance remains up as long as the big blue chips can make efficiency gains that come to the bottom line. profits always lead share profits. it's the way it's worked since the dawn of time. >> jack just said this is the equity breakout and it will continue for the rest of the year. do you agree with him on that? >> i don't think i really do. i think equities are fully valued right now. i think there's room for upside. they're probably safer than bonds but i'm not sure that i would use the term breakout. >> why not, susan, what do you think is more likely to be the case here? >> i think to a certain extent we may not see rate increase this year. i mean to quote, a lot of this appears to me to be a lot of ado about nothing. there's nothing that i see right now on the horizon that will alou the fed to make a decision

in september. >> i'm impressed you got to page seven or eight. one of the fears expressed by fed members of the april meeting was if they did raise rates in june you could get a spike in rates. another taper tantrum. do you think that would be possible? >> listen i'm going to refer to my good friend ira harris. i don't particularly believe a june tightening is on the table. the minutes don't believe it. there's a certain segment of the market that believes it. a lot of it is steve liesman and san francisco fed. if you believe they're going to tweak the seasonalities to make the first quarter look better you better hurry up and tighten. at the end of july you have the first look at second quarter. i'm siding with the atlanta fed. you're not going to have the first quarter seasonality excuse. you have a very small window for your one and done and if your focus is trying to build up the growth for the first quarter with be what other reason could there be? it's an interesting theory. >> rick, rick -- >> rick makes an interesting

point. >> they're already factoring that in. look what's happened to the 30-year over the course of the last month. it's moved almost 50 basis points. that's more than the fed would even move. [ talking at once ] >> i don't think markets are paying all that much attention to the fed. you know what they're paying attention to in the long end? qe is done the am of securities are are quarantined gets diminished with every 10 billion that goes out there every week. >> rick is hitting the nail on the head. if the fed doesn't like the data, first thing the fed does is change it. they put a seasonable adjustment on it. this is what they do. traders are great. traders have to make decisions with real money, not academic models. >> you don't believe the gdp numbers, is that what you're saying? >> i don't believe anything the fed puts out. that doesn't change the fact i have to pay attention to it. >> come on keith. come on!

>> the fed's data is more cooked than the christmas goose. they have more adjustments in every data stream they've got. what i'm saying is i don't trust it as far as i can throw it. i want to look to traders and see what they're doing with real money. that's what's going to tell you how the market perceives risk and opportunity. >> susan, let's make this meaningful to the individual investors. >> they should start with the employment reports. that's where they should start. >> point well taken. >> susan, let's make this meaning ifle to individual investors. if you're skeptical about the rise in the market right now, what are you doing? aren't there places to invest if you're a long-term investment? >> oh, yes. we're doubling down in lowe's. we think the fundamentals are just fine. we think it's being mashed around today. and it's an opportunity. you know we are always buying. but we're always selling. >> why do you like lowe's, sus

susan? they are down .5% on an earnings miss. >> but it's an earnings miss. >> home depot performed well during the same period. >> it's a projection miss. the lowe's miss is a projection miss. it's not a miss in terms of their revenues increasing or their cost being contained. it's a miss because the market thought they would do better. the fortune tellers were wrong. that doesn't make the company bad. >> right. is this a vote for housing as well in light of the strong housing start numbers we got the other day? >> i'm not pro housing. >> you're not. >> i'm not. >> do you disagree. >> i'm listening to this conversation and trying to figure out a response to this. what it really point out to me is not so much to buy low. what i'm worried about is that it points out a miss in the consumer. i think it points to a thinner wallet and unintended consequences and points to the fact that all this money they supposedly were going to save in the gasoline when that oil price came down is not finding its way

back in. >> you're talking about lowe's keith? that's what you think is going on with that story. >> it's a canary in a coal mine. i think the miss is significant. i think it's a broader picture here. >> what's wrong with saving though? if they're taking the savings from the gas pump. >> absolutely nothing. absolutely nothing. don't forget what the federal government wants you to do. the federal government wants you to spend money, which is the complete opposite of what a rational consumer will do. >> our economy is built on us spending money, not saving money. >> susan, what do you like better walmart or target here? another two companies who have had dueling reports. >> i heard target. i didn't hear the other. >> target or walmart? >> target. >> all right. >> me, too. >> we're underweighted in walmart because our clients can't stand it. >> you must be fun to deal with.

i love that. we always love having you along, susan. >> thank you. >> a few minutes to go in this session. we are seeing pressure in earnings names, lowe's being one example. target shares are 1% higher. the dow is adding 13 points at the moment the broad index 3 and the nasdaq 18. >> our discussion on fed policy and the economy continues. two top fed watchers will be weighing in on the taper tantrum part two. that would be if janet yellen and company waited until later in the year to pull the trigger on an interest rate hike. that story is coming up. stay tuned.

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the bea statement showed that gdp growth has been weaker for the past 30 years and stanley weaker over the past five. the 1.87 number is 0.6 over the last five. several economists with including researchers at the san francisco and philadelphia feds and many wall street economists have since confirmed cnbc's findings. the san francisco fed found first quarter growth could be as high as 1.8% compared to the initially reported 0.2%. many attribute the problem to one known as residual seasonality. this is seasonal patterns that hang around and remain even though the data is already adjusted for seasonality. chief of bea's national income and wealth division they oversea the gdp report. she said in a statement that the agency has identified several sources of trouble in the data including federal defense service spending. and inventories as well.

other data would be revised and initial rounds of changes to be completed by july 30th. that's in time to be incorporated in the benchmark revisions. >> glad somebody brought it to their attention. we kept a couple of our guests around. rick santelli and jack bouroudjian are here. >> take a victory lap. >> i say let's go with the second quarter gdp and see when that comes out if there's a seasonal adjustment problem there as well. >> there will be rick. we also showed in our data that the second quarter sends to be higher than the first. as far as we can tell right now, this is not a problem of gdp should be higher overall than reported. it's a matter of the sequencing of when they're calculating the growth, should it be in the fourth, first or second. >> my hat's off to you. tell them to work on the birth/death model. that has significant issues on the employment report as well. >> you want them to add back 1

150,000 jobs? >> you can parse words and be cute about it. >> it's subjective 50,000. there were some arguing from the other side. >> it's not about being on the offense or the defense. it's about doing it right. >> jack bouroudjian -- >> i agree. i agree. the problem is it should be acknowledged to the people who do these numbers, calculating the change and the movement in a $17 trillion economy with 141 million workers ain't so easy. it's not easy. how to do it is not entirely obvious. >> give it to the private sector so it's done right. and if it's not done right, we can complain out loud. >> the data is being of public good that all people have access to. >> everything the government wants to do for me is for public good. i completely understand. >> jack how reliable in your

view, you have to make investment decisions every day. the first quarter numbers keep disappointing. how much do you think this is affecting investments across the country? >> you know what i guess it's a blinding glimpse of the obvious. we have known this for the last 25 years that i've been in the markets. we have absolutely seen these numbers skewed and quite frankly we factor them in and kind of just go with the flow. >> jack, jack -- >> wait a second, steve. as a trader you do. you know why you do as a trader? >> you should be rich. >> you realize -- >> guess what, a lot of traders down here are rich. >> you should be leading against it. the data showed that the market is not aware of it. >> they figured out that pattern. >> we look at the trading -- >> look at the history of the market. >> the market doesn't need a lesson in education. it's the people trying to regulate it that need knowledge in the market. >> steve, can you explain -- >> that's, rick. >> hang on. what you need is to scrap the

entire system. >> let me point something out, guys. while we're talking, we're going to assume this is a result of your report steve. if we can see an intraday chart of the dow jones industrial average, the market is moving lower. not appreciably but the trend that was in place has changed here. >> there are interesting implications here. let's go back and see if the san francisco fed and barclays both calculated independently by the way that a real number if you seasonably adjust it is positive 1.8%. instead of 0.2 -- our tracking estimate of the number is actually negative. negative 0.7. the way i look at the first quarter right now, the current first quarter it was weak but the seasonal problems that we identified overstate the weakness. let's think about the fed in light of a first quarter that's revised higher to the plus side and something of the rebound that i was talking about with rick in the second quarter. that would possibly put rate hikes sooner than you would

otherwise think. we still cannot explain last year's 2.1% decline. getting to what jack was saying i've seen this over and over jack may be very quietly seeing this and profiting on the side. but people expected the weather effect last year. they expected it this year. they still don't have the right numbers going into the first report. >> let me ask you this steve. there's been a rivalry of sorts because of this. maybe it's media contrived between the san francisco fed and the atlanta fed which has this online gdp now, which computes the growth rate on a daily basis. minute by minute. that has been weaker than what san francisco has come out. >> right, right. >> now that we have the bea confession, who's closer to the truth, san francisco or atlanta? >> they're doing different things, bill. i hate to say -- the question is not correct. >> spoken like a true economist. >> what the atlanta fed is doing is a mechanical mathematical

thing which we do on cnbc rapid update where we average the tracking forecasts. a number comes in plug it into the model and you get a calculation. it looks -- the atlanta fed has been the weakest of all of the tracking forecasts out there. i think they'll be tweaking their model over time to see how it works in real time. i don't know that either one is actually correct here. >> what is our -- >> my thinking again -- >> what's the growth right right now. >> the cnbc rapid update is showing minus 0.7%. >> which is what atlanta is showing right now. >> atlanta is minus 0.8. >> which is completely wrong. we can see what's happening. we saw earnings come out. that's a skewed number. it's like a spring that loads up and it happens every year for the last five years. >> last word. we have to go. >> this tells investors listen to everything. listen to the market. listen to ceos, cuban yesterday saying my business is nowhere near as weak as that gdp number. then listen to what the

economists and the data say. try to create a framework around it. >> that's the disconnect. >> somebody's business better be doing good. we're making record highs in stocks. >> there you go. that's true. thanks, guys, for sticking around. appreciate it. thank you. fascinating. good stuff. you know the conspiracy theorists are going to come out of the woodwork with all of this as well. >> this is a report that might be lacking in some regards. we have 40 minutes to go until the close here. we are seeing more pressure especially in the transports. we'll try to talk about that in a second. the dow is down 35 points at the moment the s&p negative by 3. the nasdaq in the red as well. record fine slapped on the world's biggest banks, jpmorgan and citigroup settling. the stunning details of what they did and the pros weighing in on whether the fines went far enough to deter banks from misbehaving down the road. the earnings parade marches on this time it's

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universities are using ibm analytics to understand pressures in and out of the classroom- some expect to cut dropout rates by twenty-five percent. ibm analytics is working to make education smarter every day. we have a market flash on true car. phil lebeau stepping in with details. what's going on phil. >> shares of true car under

pressure. take a look. they're down more than 7%. most of the drop coming this afternoon after the california new car dealers association announced that it had filed a lawsuit in santa monica against true car, essentially alleging that true car was acting as a dealer and broker and is in violation of existing consumer protection laws in california. i just reached out to true car. it's just now receiving this lawsuit. it is looking at the lawsuit. we'll have a more formal response in a bit. when i talked with the spokesperson, he said look we follow the regulations and laws in every state. california is the number one auto market in this country. if true car runs into problems there, it's going to have huge problems around the country, potentially. that's why the stock is under pressure. back to you. >> great point, phil. thanks very much. the latest on true car. meantime, record fines slapped on some of the world's biggest banks. that's to settle foreign exchange manipulation charges. >> eamon javers has more on that

story t. looks like the grand total is $5.6 billion in fines and penalties for a number of big global banks including citi jpmorgan barclays and the royal bank of scotland. ubs, the department of justice deciding that ubs did not hold to the terms of its nonprosecution agreement. ubs now paying a $200 million fine as part of all this. the new attorney general, loretta lirchl at the department of justice in washington this morning said this is all part of a culture problem inside some of these big banks. >> currency traders at several multinational banks formed a group they dubbed the cartel. it's perhaps fitting that they chose that name as it aptly describes the brazenly illegal behavior they were engaged in on a near five-year basis. almost every day for more than five years traders in this

cartel used a private electronic chat room to manipulate the spot markets exchange rate between euros and dollars, uses coded language to conceal their collusion. >> take a look at the digital messages going back and forth between the traders released by regulators today. some of the language feels more fitting for a mob movie than it does for a trading floor. this is a message from one of the members to another one who was just joining the group saying mess this up and sleep with one eye open at night. another message from one training another one into how to do this scam. saying if you ain't cheating you ain't trying. a third message, basically admitting that sort of the core of the alleged fraud here saying yes, the less competition, the better. guys, we understand that ultimately the s.e.c. will be issuing waivers to all these banks. the banks will be able to operate as usual. we did not see a whole lot of impact from analysts.

analysts said some of the penalties were lighter than expect, guys. >> eamon, thanks very much. will this prevent misconduct by banks in the future. >> joining us is our resident law firm on such matters. they disagree on this. mark you're of the opinion these fines and the settlements don't go -- they won't change anything in the scheme of things. why not? >> that's right, bill. they won't change anything and they haven't changed anything. the reason is that we are lacking individual culpability. the shareholders are being asked to pay the tab. what drives me crazy in this instance, it's no secret who the wrongdoers were. why is the barclays vice president not doing the perp walk? this makes no sense. >> andrew should they be. >> they should be. we have serial violates of the federal securities laws.

companies have engaged in monday laundering, libor manipulation serious stuff. this is a good first step. the problem is it hasn't gone far enough. the individuals who engage in this activity need to be indicted because we know indictments work. remember what happened after sarbanes oxley was passed. you have ebbers and kozlowski indicted. white collar criminals are rational. if they know there's a real chance they might go to prison guess what they won't engage in that activity. >> why don't they mark? why aren't there ever any perp walks when it's an institutional settlement of some kind? the individuals don't end up paying themselves? >> it's hard for me to explain, bill. to add insult to injury because these banks are considered to be so relevant to the overall economy, they're actually getting as eamon pointed out a moment ago, a waiver. small businesses in wall street and finance, small brokerage

houses and asset management firms, if they had this type of prosecution, they'd be statutorily disqualified. >> a stockbroker would be done. >> that's right. >> there's the old saying that the people will go back in the water when they know the shark is dead. right now the shark has a harpoon on its side but it's not dead. if you want to talk about restoreing investor confidence in the stock market, you have to indict these guys. otherwise there will never be retail investors flooding back into the markets. >> i don't know that retail even notices these things. unfortunately retail doesn't realize they own the damn stocks through their pension funds. this is usual that andrew and i are agreeing on something here. make note of that, bill and kelly kelly. >> exactly. >> there's a perception that the markets are rigged. they may not be able to articulate it but there's something rotten in the state of denmark. these people know it. that's why they're running for the equities markets and one of

the reasons we have a retirement crisis in this country. >> we have to leave it there with you guys agreeing oddly enough. bouroudjian and santelli were agreeing on something, too. time for our "cnbc news update." benjamin lawsky leaves after four years of running the newly created agency and bringing cases against a variety of defendants on wall street. lawsky will form his own law and consulting firearm focusing on cyber issues. isis has taken control of palmyra. that's according to a syrian watchdog group. militants are trying to enter the city's historical sites as pro-government forces withdraw. indonesian officials called an emergency international meeting after the rescue of more than 300 migrants who spent months stranded at sea. the growing migrant crisis hitting southeast asia.

prince charles visited the irish fishing village where his great uncle was assassinated by the ira in 1979. mountbatten was killed when a remote controlled bomb detonated on his yacht. prince charles described his death as a deep personal loss. that's the "cnbc news update." back to you guys. >> thanks sue. >> sue herera thank you. striking pictures there. pressure on these markets, bill. a lot of people talking about the transports being under pressure not just today, at six-month lows even as markets are at all-time highs. the nasdaq slightly in positive territory. >> airlines getting clobbered today. dow component johnson & johnson is under the periscope right now -- the microscope although we're talking periscopes these days. meg tirrell has a special report on the costly risks involved in

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welcome back. dominic chu joins us. >> big story today, lots of feedback on twitter about this the transportation stocks, look

at the dow jones transport index. the five worst performer, united continental, jetblue and alaska airlines down by 4% or more. the concern has to deal with among other things whether carriers will add too much seat capacity in the coming months and years and what that excess supply will do to the profit margins. cable company stocks check out what's happening with time warner cable up by over 5%. french telecom company contacted time warner cable to express interest in a deal. those two sectors of the market very much exposed. an area of focus for today's traders. >> interesting. dom, thanks very much. are blockbuster drugs everything they're cracked up to be?

meg tirrell. >> bill thank you. we're here at j & j's pharma analysts day. when farm is analystpharma analysts analyze, they leave out a drug for hepatitis c. they model over the next few years for that revenue to essentially evaporate. we've seen this before. it's a tremendously fast rise and fall. we've only seen it in hepatitis c. in may of 2011, two drugs were approved back to back from hepatitis c. vertex and c-vec was hailed at the time as the drug launch ever. that quickly dropped off the following year and vertex pulled the drug from the market in 2014. a similar pattern followed for merck. you might wonder why this happened. in one word gilead.

sovaldi was approved and brought in more than $10 billion last year. j & j's olysio was approved and combined with sovaldi. but then at the end of last year gilead's own combination pill harvoni was approved. in two months it brought in $2 billion in revenue. that may lead to the erosion analysts are modeling for olysio. they do cure this disease. new generations of drugs have been coming on the market so fast. j & j reiterated its commitment to the hepatitis c space announcing a deal with gilead. >> back to you guys. >> good stuff. it's good for patients if nothing else. >> absolutely. heading to the close, 20 minutes to go in the trading

session here. early on we talked about record highs for the dow and the s&p. doesn't look like that's going to happen at least for the moment. the industrial average is now down 26 points with the s&p down more than a point and a half. up next on the heels of today's fed minutes, the rate hike debate rages on. what should fed chair janet yellen do and when should she do it? that debate here on "closing bell" when we come right back.

welcome back. earnings moving this market today. we'll start with etsy down 19% after last night's disappointing report. lowe's moving to the downside at 4.5%. compare that with home depot. target, here's another tale of two companies. that's up 1% today on its earnings report. walmart had a tough session yesterday. >> told a different tale that's for sure. salesforce.com leads the charge after the bell tonight. dom chu back again with a preview of the names and numbers to watch for. >> the hits keep on coming. let's start with salesforce.com release. analysts estimating a profit of 14 cents a share, sales $1.5 billion.

they are reportedly fielding possibly a takeover offer and analysts say that speculation has create the risk for the bulls heading into this particular earnings report. next up l brands earnings expected to come in at 60 cents a share, $.5 billion worth of revenue. analysts are concerned that aggressive promotions could hit the retailer hard. williams sonoma expected to post a shoft of a profit of 44 cents a share netapp revenues expected to come in at $1.5 billion. of course, kelly, bill, we'll round up all the big movers after 9 closing bell today. back over to you guys. >> dom thank you. a lot to get through there. the latest fed minutes showing policymakers concerned interest rates could spike when they begin to hike rates.

lawrence lynnleyindsey speaking at a conference. >> for more on what's best for the markets we're joined by cnbc jared bernstein. barry sloan, ceo of new tech business services says what are they waiting for? do it now. thanks for joining us today. this is a classic example of the dilemma the fed faces right now, guys. larry lindsey says if the fed waits you could face a taper tantrum. we get the fed minutes and they worry if they raise rates now they could face a taper tantrum. what do you think? you want them to raise rates now. what do you think the market's response would be? >> if they raise rates now and do it in slow methodical increment increments, the market will begin to adjust get used to it and realize it's good for the dollar, good for imports and it

is helpful for capital allocation in the u.s. economy. i think the fed should stop the five-year trend of zero interest rate policy, start to take some of the excess liquidity back and do a better allocation of capital into the capital markets of the united states. >> let me put it differently. are the risks greater if the fed waits to hike rates than if they raise them now? >> i would say the risks are asymmetric going in the other direction. the risks to the economy from an early preemptive rate hike are greater than inflationary threats if the fed is to delay. look, this is a very data-driven fed. all the data coming in have if anything pushed them out further. the minutes today make that case. in fact i think larry lindsey was talking yesterday. he might revise his views if he looked at some of the news out today. you have a majority of participants saying we should push off later than june because the economy, gdp, exports which

have been hurt by a strong dollar which would be hurt further by a june rate hike have actually been a real drag on the economy. based on the macro economy, it's all about weight. >> i don't know if you heard, the commerce department is out saying they goofed the bea goofed on the first quarter data with all the seasonal tendencies. maybe it's possible the economy was a lot stronger than the early gdp numbers suggested in the first quarter. >> it was really an important issue and none of us like to be flying blind when it comes to gdp. that's kind of the first quarter problem. i don't think that the seasonal residual problem sucked all that much growth off of it. maybe a point. the second quarter tracker has gdp now growing at something like 1%. not much of a bounce back there either. a further rationale for waiting. >> barry, same question to you. are the risks greater if the fed waits? >> no the risk is greater if we

wait. we've had low interest rates for such a long period of time. we've seen all the mortgage refinancings we need to have. we need to have the capital being able to go into the better investment projects in the united states versus capital just chasing riskier things at higher yields. it's time to take the excess liquidity out of the market and stop this monetary stimulus. >> very quickly. >> let me push back a little bit. i don't think the 25 basis points is going to change capital allocation one whip. while barry may have a point, i don't think you're going to get there from the slope he described. meanwhile with inflation something around 1.5% the rationale for increasing just isn't there when it comes to the macro economy. >> all right. we have to go at this point guys. i didn't think we'd solve the problem but we gave it a good effort there. jared, barry, good to see you both. thanks for joining us today. >> thank you. >> art cashin signaled no bias either up or down. it's that kind of a market.

just a decided lack of volatility. the industrial average down just 13 points. we've had four consecutive days now where the dow has had a trading range of less than 100 points. incredible. >> we have just about 11 minutes to go in the session. much more to come in these markets. plus, don't miss our special report on the job market as more americans are finding work in china. we debate whether artificial intelligence will create jobs or take them away. more "closing bell" in two. ...and takes the wheel right from your very hands... ...this isn't that car. the first and only car with direct adaptive steering. ♪ the 328 horsepower q50 from infiniti. here at the td ameritrade trader group, they work all the time. sup jj? working hard? working 24/7 on mobile trader,

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about eight minutes left. joining us to talk about this market phil and peter from empire execution. we had a discussion about the lack of volatility in this market. we've had four or five consecutive days where the dow has seen a trading range of less than 400 points. even when you get fed minutes, nothing has happened. what's going on? what's this market telling us here? >> it's telling me whatever the fed had to say was useless. there was nothing there. other than the fact that they said they're looking to move it back out, possibly to september. but the data is not showing that

that's even possible. it may be extended further than that. the market reacted -- it didn't even react. i don't think there was a movement. it was basically the same. we were down 22 points. it stayed there. rallied a little bit, we came back. >> unusual. >> very unusual. >> also unusual is the fact we have some of the major airlines down 10% on the day. you could string together some reasons. at a market that's at all-time highs, the weakness is telling. >> you would think there's a concern around the consumer. >> lowe's down big today as well. >> very surprising. i'm on the other side of that. i think it's temporary. when you look at the market climate, we're up over 4% today is a bit of a surprise. i agree. i thought we'd get more of a bump than we did. maybe it was all priced in to some degree. average on the mark set 8% to 10% a year. we're at 4%. we're right where we should be. the key ingredient is how serious was the april retail sales data?

>> you famously have been out of this market. we set new highs now for the s&p and the dow. there's talk maybe of a breakout as a result of that. >> where's the breakout? >> okay. we've been in this narrow trading range. although it has been on an upward swing, i didn't miss that much of the move. i don't feel like i need to jump back into this market. i think there will be a point at some point within the next three to six months that there will be that -- it won't be a correction in the truest form but we will have some movement on the downside, significant movement. the trend will start going down. that's where i'll start picking my spots. i do think we'll be seeing that within the next six months. >> what do you say to people on fixed income? >> i'm not afraid of. >> not afraid of? >> i'm not afraid of the bond market. i don't think this move in ten-year was realistic. it was more of a german issue

with the bund. >> you don't see a big rise in long rates? >> no. it's not in the cards. you have low inflation, moderate growth. negative yields overseas. other than a liquidity issue in the bond market i don't see it. i like stocks. i'm in the market on the highest allocation in stocks. >> sell him something. he's dying to buy at some point. good to see you. thank you both for seeing us here. we'll come back with the closing countdown in just a moment. >> after the bell it's more earnings, salesforce.com is front and center. we'll have the numbers sure to move stocks. and international paper ceo giving us his take on the economy. the dollar flexing its might and how that could affect profits. plus, we'll ask him about the cardboard box indicator. you're watching cnbc, first in business worldwide. it's part geek and part chic. it's part relaxation and part exhilaration.

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a couple minutes left here. tale of two markets. here's the industrial average today. here's the transportation average today. we itemized how the airline stocks were down sharply. united among them down 10% in today's session. we'll talk about it in just a moment. a preview of the earnings coming out after the close that kelly will have for you. salesforce.com, down 1.8%. netapp, l brands and williams-sonoma. bob pisani what's wrong with the transports? they're the only thing moving right now. >> it cost too much money to

fly. have you tried to fly anywhere? now some vague talk very vague, that maybe they'll add capacity and maybe cut fares to low-cost carriers. is this not good news that fares will go down? >> for us. >> everybody is freaking out, oh heavens, they made so much money for so long i'd be happy to trade lower stock prices on the airlines for a lot cheaper airfares. this is me as a consumer. >> they have the same size jet, they just add more seats. >> we're going to be in the bathroom. >> sardine time. >> exactly. the other thing is everybody keeps talking about the imminent rate hike that's coming. it's not not going to be june. everybody is crowded into september. of course, the market finds ways to confound people. my attitude has been one and done in september. they actually issue a statement saying they're not going to do it anymore. that's the only way they'll get a rate hike and not freak out the markets.

dividend payers moved up today a little bit. we'll honor the members of fleet week the armed forces in new york city for the memorial day holiday. stay tuned. the second hour of the "closing bell" with kelly evans. thank you, bill. hi and welcome to the "closing bell," everybody. i'm kelly evans. we're seeing red arrows across these markets a day after finishing at record highs. it's giving up 26 points going out 18,285 the s&p for its part losing two. the nasdaq managing just ever so slightly to stay in positive territory. we'll see if that holds true as things settle out here. it's up a couple points to 5,071. we have more earnings on top. talk about that the fed and much more joining today's panel.

we have larry kudlow along with steve liesman. with more on today's markets and sales force earnings set to report money trader tim seymour and that's christine sheet here. steve has something to say. >> i want to acknowledge the servicemen that are here from all different branches. a lot of them from navy. i don't know if we can get a camera on them. just acknowledge their service. they're here in new york for fleet week. >> commander dale stallworth ringing the closing bell. hard to believe the markets are holding the way they have. what about sell in may? people are selling the transports what do you make some of the airlines? how is it possible united is down 10% on session? >> so many questions, kelly. the airlines, people are concerned about a sector that for almost two years has been rerating on the back of big changes. the present numbers and the updates we got yesterday late afternoon pushed a lot of these

guys down. this is aa buying opportunity. a lot of long-term investors and airlines are waiting to see what the numbers mean. when you look at may overall, look at the volatility in rates. that's more of a re-adjustment. i really don't think there's that big to do about anything. i lack at what the fed told us today. they're largely day trading the economic data and that means that while things remain in this data dependent environment, i think investors can be clear on what's happened. >> southwest down 9% united down 10%. big declines across the others. jack moore, i want to give you a chance to weigh in here as well. tim said he'd be a buyer of the airlines. what is going on with that sector? >> it was interesting, i remember being in this exact position talking about the airlines a few months ago. and there are a lot of bulls. almost all of these names have almost all buys, no sells. that puts it in a precarious position when you have days like

today when there is shakiness and concerns. i know i work with jim cramer at the charitable trust. to have american airline's ceo come on and say we're going to likely have more capacity i appreciate the transparency but that's concerning. they ran ahead of themselves. that's why it sets them up for risky type of moves intraday. >> can i ask you a question. >> fuel prices are down year on year. i know there's bumps up lately maybe short. fuel prices are way down. i thought the global economy was getting better not worse. that should help transports. >> tim, you want to take this one? >> this isn't about the global economy. i think this is how airlines are running their business. it's a fair point, a lot of people thought this rerating process goes on forever. talking about lower fuel prices i would -- two things that are most important, the labor

market, i think it is tightening. i think the conditions are slowly getting better. i think there are wage gains for skilled laborers. this is something you need to continue to follow. i also look at the global economy. gdp in japan was better. more importantly, the forward indicators in japan indicate this wasn't a one off. i think things are slowly getting better around the world. that is what is supporting equity markets. the moves we've seen in the dollar and rates are adjustments. >> okay. >> significant overpositioning in all these places. >> who do we believe, the airlines? or the gdp number? >> first i want to congratulation tim seymour who we all know to be a smart guy and have a terrific head of hair for using the term wage gains, not wage inflation. just because wages are going up doesn't mean there's inflation. people should not freak out if normal americans get raises. that's good for the economy. >> more people working is not inflationary. >> exactly. >> oh, good. >> larry kudlow taught me growth itself is not inflation.

>> that is correct. >> especially if we have supply side growth. >> hold that thought. >> among other things. i've never forgotten that thought. you think my sitting next to you has been meaningless over the years? it hasn't been. it's quite meaningful. >> what did you have for lunch. >> i think we are in a sideways position. waiting for the economy to clarify. you could take a step back from the market and say you know what, the market in general is optimistic. we're at a relatively lofty level here. the idea that the economy is going to turn around the data is going to slowly or even rather quickly get better as the second quarter goes by seems to be inside the general feeling of of the market. i think if you have better economic data and better earnings data i think there's another leg higher to the market here. >> jack, you want to weigh in on that? >> i think, look the one thing that gives me some hope when we're talking about the fed is that they're not going to raise the rates until there is

progress in the economy. i think if there is a sell-off on any prospect that rates are going to be delayed that that decision will be delayed, that actually creates an interesting buying opportunity. i think that look we've had disappointing economic data points. if the fed was moving faster i'd be very concerned right now. i think we're in the right place. there are interesting buying opportunities. we own target for the charitable trust. that deserved to move a lot higher today. there are better companies that aren't getting -- >> jack jack let me ask you, buddy, have the analysts, bottom bottom-up analysts downgraded earnings too much in the first half and will they start to upgrade earnings in the second half which i think would be bullish for stocks? >> i think there's been a lot of volatility in the earnings forecast. i think analysts got burn by having too high expectations heading into 4q took it down for 1q.

i think they're taking it down for 2q as well. i think expectations have to come up. the earnings growth forecast are almost it's de minimis. there still is margin expansion to be had. more importantly, i think there's more top line expansion to be had. >> same question. do you think we'll get upward earnings revisions for the second half? >> this is how it goes. you come into the season the estimates are very low. as we start to report and companies are beating ab analysts are increasing their estimates. we have a crowd source system that often means our estimates are a little bit higher. we are looking at the buy sides and individual investors as well. typically right now for the first quarter, growth is at 2% on the earnings front. like jack said we're looking at negative revenue growth of 2%. that's something we need to see increase as we go further into the year here. >> let's get one more indication here. salesforce.com, those quarterly

results hitting the tape. josh lipton has the numbers for us. >> salesforce just reporting. let's get you those numbers. salesforce reporting 16 cents on 1.5 billion. the street kelly, was looking for 14 cents on 1.5 billion. looking through the release, deferred revenue, 3.06 billion. that was up nearly 40%. looking ahead, q2 guidance eps sales force looking 17 to 18 cents, that's basically in line. they raised the full year eps of 69 cents to 71 cents on revenue of 6.52 to 6.55 billion. on the call of course you'd expect analysts to have questions for ceo marc benioff about all the rumors of m & a speculation, that call at 5:00 p.m. eastern. we'll be on it and bring you headlines as they come. back to you. >> josh, i mean what do you think? obviously the company is not going to say anything in this earnings statement, i would imagine, about that. a pretty unusual story over the last couple of weeks, this idea

they're effectively, they've been in talks. then the talks have died down. where do we stand? what's the latest on that? >> we certainly saw, you know those headlines first dropped on april 29th. we saw that big jump. i think it was around 10%, 11%. we have headlines coming backwards and forwards. all kinds of rumors of who would be a good fit. was it oracle microsoft giving that relationship between adele and benioff. was it ibm? we know the stock, as more reports have come out, that that talk has cooled the stock was off heading into this report about 5% since the headlines first crossed. a lot of interest on that call about what benioff will tell us. >> even after hours, a positive reaction to earnings on their own, up 3% on that report. josh, thank you. we'll let you go. be sure to catch salesforce ceo marc benioff on "mad money" tonight to discuss these results and the takeover speculation. that starts at 6:00 p.m. eastern time.

we leave it right there for the time being. unless, jack do you want to react to the salesforce results before we have to go? >> i'd love to really quickly. i'm actually very impressed right here. now we can focus on the fundamentals of this company finally. going into this they had to deal with a lot of things. m & a certainly bid up the price. everyone was saying the up side is limited. this is a great beat for the company. there is fundamental strength in this business. i would love it if we could focus on the fundamentals. >> i absolutely agree. we were looking for 15 cents a share. they beat our higher estimate and a lot of this has been overshadowed by this takeover talk. we get to look at the fundamentals. they needed to beat here. they have an insanely high p/e, seven times the s&p 500 company. they are a leader in the cloud space. idc released a report that spending on the cloud will soar in the next five years.

i think they are one that's really going to profit. it's nice to see the numbers come out. >> this reaction up 2.5% after hours. what does it tell you about the takeover premium that might be embedded? josh mentioned they're up about 5% since all of this speculation started. >> yes i think -- i actually think the takeover premium has been whittled down a lot, at least priced into the shares. i think the probability that the shares are saying that the takeover will happen is very low. because i think the $85 to $90 is around where people think the premium would have to be. >> i don't mean to cut you off there. $72 is where they're trading right now. we're out of time. we'll leave it right there. tim seymour, last word to you. what are you keeping your eye on? >> it's hard for me to believe a stock that's trading at 59 forward earnings doesn't have a lot of takeover earnings in it. this is the part of the market that's having trouble, high multiple, high momentum stocks.

everybody who cans have been refuting the premium. the stock trade is down. >> fair enough. be sufficient to stick around and catch more of tim seymour coming up on "fast money" at 5:00. salesforce earnings call also kicks off around that time. don't go anywhere. much more here on our special market coverage. "closing bell" continues in two. we live in a pick and choose world choose choose choose. but at bedtime? ...why settle for this? enter sleep number... don't miss the memorial day special edition mattress with sleepiq technology. sleepiq tells you how well you slept and what adjustments you can make. you like the bed soft.

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welcome back. we begin with josh lipton back for a quick earnings flash. hi, josh. >> kelly, the earnings coming in fast and furious. here's another one. netapp reporting 65 cents, kelly on 1.54 billion. that's a miss on the bottom and the top. you can see the reaction there in the stock. guidance though, also netapp look for q1 20 cents to 25 cents. the street thought they'd see more like 59 cents. a disappointment there. >> the share is down almost 6% on that one for now. thank you. stocks volatile after the fed indicated a june rate hike is unlikely. bob pisani is here on the floor of the new york stock exchange. bertha coombs at the nasdaq and rick santelli at the cme.

what parts of the market was reacting most do you think? >> i think people are in the camp that you can still make money because the rate hikes keep getting put further and further off. i think most people on the floor, and i am in the camp of the one and done in september. a lot of people are hoping the fed does one 25 point basis rate hike, once and done for the year. >> what was it about the nasdaq that allowed it to buck the downward trend today, bertha? >> we had a couple of biotech stocks doing well. meg tirrell is so much better at these biotech names. we are come on the seasonal time when biotechs perk back up again. the interesting thing is talking to people they're not really thinking about the fed. everyone is thinking it's going

to be one and done one and pause. it's now about the economy, stupid essentially we've gotten sort of the three trades that had been working kind of on pause and stabilize. the dollar interest rates and energy. and now we're starting to focus again on the data itself. can we see this economy pick up steam in the second quarter? is it really going to bounce back? >> right. >> when you hear from the retailers, it certainly doesn't look that way. >> it doesn't. the retail earnings have been mixed. what does this economy need to show that the growth is really there? is it the next jobs report? is it the gdp we've been talking so much about today? >> i think we need more productivity and true growth in the economy. you know, it's not necessarily only about adding jobs. it's the quality of jobs. it's the fact that if you're putting more inputs in the economy, once you suspect better outputs in the economy. i think regulation is an issue. maybe at some point we'll get a political class that will say if

you're under a certain threshold of a business we'll slash the red tape we have to deal with. you heard mark cuban at our conference. the amount of new business that's being created is subaverage, below where it needs to be. these are all issues that need to be addressed. >> i want to add to what rick is saying. i agree with every single comment he just said. we need more capital investment in addition to the deregulation. one of the reason productivity stinks is capital is not being provide into the economy. >> how do we do that? what's the problem? >> stop raising taxes on capital. >> okay. >> we can start there. the biggest single thing we could do to grow this economy faster so to slash the american corporate tax rate to not higher than 20%. second, stop double taxing overseas profits so they'll bring the money back home and invest in long-term projects. and third, stop beating up on businesses and businessmen.

why didn't this administration, why don't they say we are behind american businesses instead of blaming american businesses. >> we have a question from classmate liesman. >> i find it hard to believe that the problem in the u.s. economy is capital. we have massive capital formation in this country. >> we do not. >> we have incredible corporate profits, incredible retained earnings. incredible ams of money overseas. what is stopping these companies from investing right now, first of all -- >> there's a venture called capital deepening. it's not there. we haven't seen capital deepening. >> i think all you guys are underestimating this. >> we have the financial asset paper chase. the capital doesn't create business. it creates more april profits. >> you are underestimating business. the idea that these guys -- that businesses are out there bringing on employees and creating negative productivity own efficiencies from the hiring

is wrong. either there's a problem in the data or the productivity is to come. but they're not hiring people and creating negative -- >> there's a problem in the leadership. there's a problem in the leadership. >> let me bring in this capital deepening. that's a really important point. the way economists measure capital deepening, one important way. this is a greenspan specialty in the 1990s. >> when he saw the productivity boom was about to happen. >> it's called the k over l airasia year. k stands for capital, l stands for labor. companies are profitable. i agree with that. a lot of those profits are gone offshore and not being re-invested for tax reasons. and number two, companies whether they're large or small are afraid to make long-term commitments. five, seven, ten-year commitments, the kind of which we had in the 1990s with the, we're

not getting that now. >> we definitely need more capital formation. we've been trying to get ipos beginning for years. >> got to leave it there. >> we have record ipos in this one. >> no, we haven't not compared to the 1990s. >> in the 1990s you have companies, ipo'ing that had no business being in the market. >> that's a great point, too. >> right now you have companies returning that capital to investors. >> we need more -- >> bob, the closing word here. >> i was impressed with the story you did today -- >> stop taxing -- >> you got the government to admit they were messing up on the gdp. >> stop taxing and regulating businesses. >> we'll continue this conversation over twitter during the break. thank you guys so much. much appreciate it. let's send it out to dominic chu for an earnings alert. let's let's talk about williams-sonoma williams-sonoma. it came in at 48 cents, analysts looking for 44 cents.

$1.03 billion, analysts were expecting on average $1.1 billion. we did see, they said that quarter one comparable store sales were up a much better than expected 4.6% estimates there were for a gain of 3.1%. however, there is at least a downside to this report here. they did offer weak q2 revenue and earnings guidance and they cited among other things the west coast port shut down. nonetheless, investors seem to be at least accentuateing the positive, eliminating the negative. shares are 4% higher. again, william-sew moment ma moving to the up side. guidance for the current quarter on the lighter side kelly. back over to you guys. >> dom, thank you for now. williams-sonoma bucking the trend to some extent. share buy bucks are booming they've been a part of this record rally. corporate leaders aren't spending their own money to buy their company stock. why that could be a red flag

that stocks are starting to look expensive. later, we're looking at the future of jobs artificial intelligence robots will it help create jobs or take away the ones we've got? we hear from a pair of experts, coming up on the "closing bell." you're watching cnbc, first in business worldwide.

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many corporate leaders are buying fewer shares. charles beaderman is founder and chairman of trim tabs the independent research firm. he joins us now. good to see you. you're saying the fact that companies aren't putting their money where their boards are is the case here? >> well companies have bought back a huge amount of shares. the float has shrunk dramatically. 1.6 trillion half cash takeovers of public companies. and half due to stock buy backs, minus all new share sales, including insider selling. >> i think i said it wrong. what i men to the say, executives aren't putting their own money where their corporate boards are. that's the point you're making? >> the point is companies are driving their stock price up by doing float shrink but executives the last month or so have stopped buying their own

shares. they're raising the share price of their companies by float shrink activities. they're hoping to take their existing holdings higher but they're not adding to the existing holdings. >> do you have a problem with this? >> i don't have a problem. i've known charles for many years. he does great work. flows doesn't set prices, valuation sets prices. i don't think insiders have better insight into the stock prices. the market is a gigantic market. i think valuation is based on earnings and interest rates are bigger drivers than stock buy backs. >> how reliable in the past has insider buying or selling been in terms of valuing stocks? >> insider buying is not the key. if the total number of shares is shrinking and there's more money chasing fewer shares because of corporate action, there's been no new money from individuals over the last four years. no new money.

the only buyer -- more money chasing fewer shares we have higher stock prices having nothing to do with valuation, p/e. it's all supply and demand of stock and money. >> from an economics point of view, it tells me that executives are stupid. right? that's the conclusion. >> no. >> is that if you're out there and you essentially have a chance to front run your own book, right, which is you know you are going to execute -- i don't know if it's front running, running. by the way, these shares have gone up over the past four years. if you're telling me which i think you just did, that the ceos have not been net buyers, that means they're net stupid. >> no. i'm saying recently the sell/buy ratio is over 20-1. it averaged less than 10-10. there's always more insider

selling than buying. the insider selling has dried up is my point. as long as the number of shares keeps shrinking and more money chasing fewer shares i firmly believe stock prices will keep going up having nothing to do with the fact that the economy is not growing. as i've been saying on your air, the fed will not raise because the economy is not growing sustainably. and it can't given all the stuff larry was talking about. just earlier him and rick rs we know you guys have put your money where your mouth is creating the float/shrink index. it's done well. thanks for making the point here. good to see you. >> thank you. >> i sincerely hope we're not doing the economic profession any damage with my colleague, steve liesman. i just want to tell you how fun it is to bat this thing back and forth. you're terrific. your front running comment -- >> it is right? >> a little snide. a little bit on the money.

a little snide, a little snarky. >> i learned from the best. >> i know. >> it's time now for a "cnbc news update." sue herera, what's happening? hi kelly. here's what's happening. senator rand paul has been talking on the senate floor for about three hours now, filibustering to tie up the trade bill. that filibuster can't go on indefinitely because of the rules of debate. the best he can do is to lay the amendment votes on trade until 1:00 p.m. tomorrow. the drug enforcement administration is conducting raids on pharmacies and pain clinics in four states as part of an aggressive crackdown on prescription pain medication abuse. mcdonald's workers protesting outside company headquarters in illinois this afternoon. ahead of the fast food giant's annual shareholder meeting tomorrow. demonstrators are demanding a union for workers and a pay increase of $15 an hour. nfl commissioner roger

goodell says his response fwolt hear directly from new england quarterback tom brady and his appeal of his four-game suspension for deflateing footballs, the players' union has called on goodell to recuse himself from ha hearing the appeal. the controversy on that one, kelly, continues. that's your news update this hour. back to you. >> all right. sue, thank you very much. coming up international paper, one of the nation's largest makers of cardboard shipping containers. how would the pacific free trade deal impact the company and our economy? ceo mark sutton is here to comment on that and much more in just a moment.

if you shipped something or are expecting a p.a. package in the mail international paper was probably behind it. joining me now is mark sutton the company's ceo here at the new york stock exchange. welcome. thank you for being here. you are the proxy of my favorite economic indicator of all time. the cardboard box indicator we've had discussions about how reliable gdp numbers are and what's going on with the u.s. company. based on your shipment data how

is demand. >> we started off stronger for the first quarter of the year. box demand was up a couple percent year-over-year. we were thinking it would be 1%. that was across a lot of segments. our indicators forward looking would say the second half should probably be stronger than the second half. >> we hear from the gdp numbers albeit with distortions that everything was weaker than expected. expected.. you're saying it was stronger than expected. why, how? >> we think about the american consumer. it could be gas prices. it could be pent up demand. going out to eat, other nondurable segments really showed strong points across food, online distribution. the restaurant industry. so it's sometimes quarter to quarter disconnected but we saw good demand. >> cardboard boxes are a great place to be for the new economy which relies so much on hourly shipping. fast delivery. it still has to be carried in

something. what kind of opportunity does the new infrastructure being built around amazon and other companies offer to you guys? >> what's interesting about that segment, it's about 5% of the box market. it's growing 20% a year. you mentioned amazon. other companies that are really building their online presence are using corrugated package to get the product to us as the consumer and we're excited about that. it used to be seasonal. now we see a strong result even away from the holiday season. >> great point. obviously when we think about boxes, we think about exports. just from the big picture point of view exports in this country, what bottle necks do we still see out there, if any? >> i think temporarily you could run into currency issues. for our business, what we export is exported because of the products needed. it's our container board to make our boxes. u.s. forest products industry is

globally competitive in that. ip experts of 20% of what we make in the u.s. we did good infrastructure, transportation. our company is in a good position from an export standpoint. >> do you support the transpacific partnership, the trade deal being discussed in washington. >> we do. we support the tpa to give the president the ability to negotiate and finish these deals, both the ttip and the transpacific have value for our company. one of the big issues is making sure we're at the table to make sure illegal logging is taken out of the trade so we level the playing field. it also opens up new markets for our products. >> what happens if this does not pass. >> it makes it harder to get into some of the new markets and makes the playing field unlevel and raises our cost effectively when someone can get wood illegally and not sustainably. it hurts our competitiveness

which ends up backing into do we have enough markets to keep our factories running? >> we were debating capital spending. we need more of it in our country. >> our view on cash flow it's sustainable and strong and has been for a few years. we have a balance return of that cash. we've been growing our dividend double digits for the last three years. we have a modest share buy back program, $1.5 billion authorization. we spend capital investment money pretty substantially. we just started up a new container board mill in oklahoma. we're expanding food service, fiber cop, coffee cup plan in the ohio another 100 jobs. >> do you make the starbucks cups? >> we do. >> wow. how is starbucks doing? i suppose you could tell us. >> they're using a lot of cups. we make a billion cups say day. it's a real success story for our customers they work hard to

build a sustainable message about how they're growing the coffee coffee. they want to serve it in a sustainable product. >> what's the next project you're working on across the industry? >> the innovation we're seeing in our food service business where we look at taking that sustainable fiber packaging into new uses is something we're working on now and combinations with different types of lids so the entire product is sustainable. >> we look forward to it at our corner starbucks. thank you, mark sutton for being here the ceo of international paper. >> appreciate it. a new report finds that 80,000 americans are employed by chinese companies that number was less than 15,000 just five years ago. how many are expected to work for these chinese firms in the next five years? we have surprising numbers. and should americans be worried about robots taking their jobs in the future? we'll hear from the experts when we come right back. stay with us.

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will employ between 200,000 and 400,000 americans by the year 2020. that's because chinese investment is rising. roughly $47 billion has been poured into the united states by the chinese since 2000. and 90% of that is in the last five years. the states receiving the most money, california texas, north carolina all receiving $5.5 billion or more. that's followed by illinois and new york. many of those investments are in real estate or oil production. headquarters, u.s. headquarters for chinese technology companies like alibaba. when it comes to the largest number of employees, that's a little different. north carolina is number one. it is the u.s. headquarters of lenovo, it employs 8,000 people. additionally smithfield foods, bought by a chinese meat processor recently has several facilities in north carolina as well pen employs 5,000 people.

kelly, with the announcement in the last 24 hours by the justice department that they've uncovered a spy ring related to chinese espionage here in the u.s., investment by chinese companies here is quite controversial. but the report shows, i think, that a lot of americans may have to get used to it. and the government will have to figure out what they want to do about it. >> thank you, michelle. that's just one aspect. china plays a big role of course and that is good news, given some of the headlines out today. a new harris poll details 40% of unemployed americans say they've completely given up looking for work. all of this plus the impact of new technology raising questions about the future of the work force and jobs in america. we've gathered a special panel to discuss what lies ahead. matt berry, ceo and charnl of free lns. freelance.com. and cindy and eric corbitz.

matt, let me kick it off with you. what impact do you think tech knowledge in the first place is going to have on the propensity of people to work in the future? >> well technology will create a lot of job categories but they'll be in technical feels. at the same time new technology coming in will cause disruption. a lot of jobs are going to go. any job that's described by an algorithm will go in time. >> any job described by an algorithm. >> that's right. >> eric, how many jobs is that? >> technology has always been a source ofinging distributions of what it is to work. there would be disruptive influences in ai the area of intellect. >> not just about the assembly line anymore. >> right. as well as sophisticated robotics of various kinds. we started the national academy

of science study on the future of the work force and technology and i think this will be interesting set of issues being looked at. the gdp, per capita gdp and the mean income is widening and people have thought that this might be related to the influence of competing technology and machine intelligence in the world. >> cynthia, this is all your fault. you are one of the companies making robots to come into traditional services right. >> what we're creating is robots that are teammates and complement the services that human professionals can provide and help families in the home. a big area of that, because of the intellectual side of tasks being able to be automized is education. education is key to remaining competitive in the modern world and be a life-long learner. ai can play an important role

too. >> are these threats or positive developments just as every innovation and technological change has largely produced fruit over a long period of time? >> long term good. short term painful for people. i did calculate an algorithm for what everybody on this panel will say they're all gone. she was going to say education. we're done. >> do i want to say this this is the long term. see, you're right in a static way. >> i knew you were going to say that. >> this is not a new subject. we're talking 20 25 years here. the assembly line economy has been over since the 60s. let's face it. creative destruction, disruption is the great ef thing. this country needs more disruption. we need to forms brands new businesses that will disrupt. it's just like this china story mcc. larry -- >> hang on.

just like japan, just like germany, it's great that china is investing directly. it will be a huge job creator. it will be disruptive to the economy in a positive way and they will pay higher wages. >> i just want to point out, it's a correct discussion of the economic forces. how we choose to handle the fallout from this the pace of change that we allow in all of our industries are social and cultural discussions that have to be. >> what kind of change of pace do you see. >> we see all kinds of things happening. free lances around the world winning jobs using software to win employment. there are a number of jobs that over time will hit the software starting with copyrighting and so forth. in fact phillip m. parker on amazon writes all his books using software.

>> wow. >> you'll see a dramatic change. in terms of social impact the biggest impact we'll see is going to happen in industries where the work force is going to have trouble reskilling. self-driving cars which is the next step obviously for uber and so forth. think of the number in transportation. fundamentally the world will be a better place when the tech knowledge comes out. >> we're almost out of time. i want to give eric and cynthia a chance to weigh in here. to that single question what is the best skill, the best way they could prepare themselves for this change that's coming. >> it's much about an attitude of being a life-long learn enand certainly technical expertise will continue. >> learn how to code. >> i think being deep and interested in computer science, how it works, how to complement computing systems an how they complement human beings data

science is growing in leaps and bounds. lots of things to do. >> all employers. three months to a code academy. >> i like your point. i know we're heading out. the robots complement. we workrobots. my thought here we just have to apply ourselves. we need the education, we need the job training. as adults who want to work and succeed we need to apply ourselves. in our lifetime it has all changed, everything is completely changed. at first i couldn't to it. i finally figured out how to do it. that's a big help. >> thanks for being here. i'm sorry we have to leave. >> you're the guy that writes the algorithm not about the guy who the algorithm is written. >> thank you all. important topic. oil pipeline spill leaving around 21,000 gallons of crude over a four mile stretch of california coastline. will that hurt the push for more offline drilling and will that

hurt the keystone pipeline? that's coming up on the "closing bell".

it's almost 5:00 here so it's a good time to tell you cnbc is launching a new digital series called "raising the bar." two ceos walk into a bar and note the challenges of getting to the top.

here's a little preview about the advantages of going to college or not. >> i didn't quite have the courage of conviction to do both choices. everybody i knew was going to college and stuff like that. i wish i made more nontraditional choice. >> it's funny. we had this super dynamic woman working for us who took some time off from school and we agreed to give her job under the promise she would return to school because we didn't want to be reason why she didn't finish her college education. >> she did go back to school? >> she decided not to. >> i completely agree with that. if you love innovating and retail like you are. if you're in a spot you're learning you're going to college and business school and come out and look for the same job. >> that moment in time it was

so important for you to be in that spot in the first place. it might be gone. the companies change and opportunities change rapidly. if we think about how we hire people. how much time do you spend looking at their time in college. >> the generation before us they were like oh, what job do you want. you can have any job you want. now nobody cares. in fact when a kid walks in with a harvard degree i don't really care. i'm like what do you know how to do. what are you passionate about. it's people that did something on tumbler. that's the stuff that gets me excited because there's something that can be applied. >> for more of that conversation head straight over to cnbc.com. up next much more on this record market plus the latest on the massive oil spill off of california's coast and what it means for the future of offshore drilling.

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reported tuesday afternoon when a woman smelled the fumes from the crude oil. officials have begun to clean up the mess. larry there's a much bigger oil spill in this part of california years ago. now one they say helped trigger the environmental movement. >> yes, you're right. look we hate to see oil spills. we just hate it. we also learned, i think in recent years it can get cleaned up. these companies have the technology. they are very conscious of this kind of thing. really you know, california has so many energy resources, including the potential for fracking oil and gas that would do so much good for the state's economy and the country. i just hope the enviros, i know they will try to stop it. this will be fixed easily. >> final thought on the economy, a data point to watch out for this week? >> janet yellen. she's talking friday on the economy at 2:00. stan fisher is talking europe. but janet yellen in providence

rhode island talking about the economy that will be a big focus for the markets. >> thank you both for being here this afternoon. that does it for us on "closing bell" bell". >> weakness in sales on walmart, macy's, kohl's. maybe it's time to blame apple. we'll trade that. >> or buy williams sonoma. >> "fast money" starts right now. overlooking new york city times square. i'm melissa lee. tonight on fast you might want to press that flight attendant button. one of our traders says the sell off is the perfect buying opportunities and explain why. plus thousands of protesters are pushing for higher wages at mcdonald's but there's a bigger problem for the golden arches. the sales call first getting under way. we go live to san francisco to listen in on the call. but first let's trade tha