>> yeah. there you go. trex, complete homer. see you tomorrow. look forward to "fast" tonight. >> at 5:00. the s&p just turned positive just in time for the most important hour of the trading day. that is the next hour. we'll see you tomorrow. take care. hi, everybody. welcome to the "closing bell." i'm kelly evans at the new york stock exchange. >> i'm bill griffeth. yes, we're kicking it off with big swings in the market. the dow still in the red. i have to keep checking to see if it's going to hold. coming back from a deficit of 211 points earlier in the session. we're going to take you through all the action in the final hour of trading. the s&p has turned positive. we show you how in of the sectors. >> materials.

leading the charge up almost 1%. talk about a beaten down place. health care, too. had a tough quarter. down about 11% discretionary energy. those are your green chips today. >> even with energy itself down, oil. >> that's interesting. if you're looking to position your portfolio at the end of the year, we'll tell you what is the winner in the fourth quarter last 25 years. that's coming up. biggest winner in the last 25 years in this quarter is coming up. >> the answer may surprise you. russia is launching fresh air strikes in syria today. we have the uurair shah groups. >> it's all the talk around here. >> absolutely. plus, market tur mill hitting the biggest hedge fund managers. we'll tell you who got hit the hardest coming up. let's start with the markets. bob pisani is tracking the action here at the new york stock exchange on this first day of the fourth quarter. what to take of it, bob?

>> we started out great. gap up in the s&p. and then like germany, just sort of drifted lower throughout the day. and we've been coming back. we're almost positive on the dow jones industrial average. volume's on the heavy side. first day of the trading quarter, first trading day of the quarter. normally what you get after such a disastrous quarter you buy the winners on the first day. we're not getting that buying enthusiasm. alcoa, disastrous in the third gown. down 3% today. that's a disappointment. here's freeport mclelan. it is not going to make up for 50% drop in the markets. excuse me. energy stocks bouncing all today. mostly on the downside. exxon also had a terrible quarter isn't doing anything. to the downside. you're getting a little bit of movement in some of the refiners like vel democrats lero but not

a lot. these are proxies for global growth. not a lot of buying interest here. honeywell is flat on the day. you would have thought that would be up. 3m also down fractionally. we're moving towards positive territory. we have no buying enthusiasm. we haven't had it for weeks now. i've been complaining about it. until somebody starts seeing value in stocks like this, we're going to have a hard time getting notable advances in the market. one good point i would make, kelly and bill, is the vix is now down three days in a row. it's settling down. the volatility is settling down a little bit, in the low 20s. >> bob, that's a point. thank you, bob pisani. crude oil moving lower after being up nearly 4% earlier today. that could have something to do with this market. that's on the heals of russia launching air strikes into syria. >> so maybe price would have even been lower if there were no air strikes. let's talk about it, bring in

haleema for rbc and point out we're happy to see she's our newest cnbc contributor. welcome to the family as well. >> thank you. >> welcome. >> thank you. >> what do you make of today's action and is the market responding to inventory data or what's going on in russia, or both, i guess? >> inventory data yesterday in terms of the build was bearish for crude. on the other side you had indication that u.s. production was slowing. in many respects the data was a wash yesterday. right now it looks like the market reaction to russia, syria has been quite muted. if you did have some type of headline, something disastrous in terms of russia striking a u.s. jet, that would push crude prices higher. right now everyone is waiting to see what happens, how it plays out in syria. the market hasn't really reacted to it yet. >> what's your read on putin's intentions here? >> you know, one of the things that we're sort of concerned abili about is just in terms of the terrorism angle. you have a situation where, you

know, putin has escalated there. you have the saudis on the other side. i mean, these is putting tremendous pressure than on their budgets. thousands of chechens have joined isis. middle east outpost for syria. there are a variety of factors coming in to play here. in terms of the oil market you do want to watch for some type of headline, the situation is getting worse and move crude prices higher. >> it seems though that this is one of the few times lately when the markets have responded to a geopolitical event like this. they seem to ignored other events like this in and around the middle east. >> yeah. they have responded a bit today. if i go back to a couple years ago when you had the arab spring, all the concerns about israel strike on iranian nuclear facilities. it took very little to move crude prices higher. one of the things you have to remember is we have four active wars in the middle east right now and the market really has shrugged it off largely. if this had been a couple years ago, if you did not have a

supply overhang in the market people would be a lot more concerned. the saudis are backing these rebels and on the other side of it you have the other big producer now actively engaged in this fight. you have some of the biggest oil pro dauser educers squaring off battle. the market reaction is muted given the stakes at play right now. >> i know when we're focusing on the supply side, as we discussed, putin may be as well. it looks like it's eroding when we start to look into next year. how much demand do you think a global recession is going to take out of the market and what impact is that having on prices? >> that's a really bearish indicator to watch for. we've had the highest demand growth in five years. in some estimates, 1.6, 1.7 million barrels in demand growth this year. if we do not have that next year, if demand starts to soften, yes, you could have rolling u.s. production. if it goes away obviously going to be bearish for crude next year. >> maybe we're seeing that

hitting the market as well today. joining us now for the "closing bell" exchange, the bigger picture for the markets. david from jeffries is with us today and mary from merrill lynch, steve grassorganization from stewart franco and rick santelli joining us from chicago. rick, steve grasso, i'm sorry, let me start with you to get a view from the new york stock exchange and what's going on today. so many different stories and i go back to a question i asked you the other day. is there t. market trading more on the fundamentals going on or is this more a technical kind of market here? >> i mean, it wants so desperately to trade on fundamentals. if you drill down on fundmentals, bill, dollar strength on a relative basis which is going to be a headwind for the multinationals. no one is getting super excited about that. technically we had -- you start off the show saying that we had one of the worst quarters, we've had the worst quarter since 2011

for equity, the worst quarter for commodities in 2008. what would really be the impetus to start buying into that if you look at what past performance has been, we've sold off 40 to 55% in the marketplace with two negative quarters. i don't mean to be the bearer of bad news but i don't -- depending on where you draw the lines, i don't think it real lit bodes so well. these are quarterly charts. so they do take a long time to play out. >> let me pick up, rick, back to you on this. 2% ten-year that we saw this morning fr the disappointing ism report. if you had to two really solid economic indicators, jobless claims were good this morning, decent anyway, and the manufacturing which didn't look so hot and the market is paying a lot more attention to the manufacturing gauge, it seems. >> i think it is. and jobless claims to me, the next time jobless times is going to be important in the marketplace is when they start to move higher. pretty much it's all priced in.

we have a recovery that has jobs. but it doesn't have productivity and it isn't translating to type of growth we need. that's the foundation. you know, let's stick with this. on the interest rate front you're correct, we touched 2%. back to unchange. it isn't the intraday, it isn't the track of the roller coaster. it's where you get on. it's where you get off. and i would also point out boon yields touch 53, which by the way is the lowest yield close there since may 29th. give you another notion. i like to ask everybody on the panel, you all listening. what do you think the total return, price appreciation, and interest for the ten-year is, total return year to date as of yesterday? any guesses what that percentage is? >> you drive the ship. >> it's flat. >> 2 1/2%. it's up 2 1/2%. yesterday the year to date was down 7.6. the only reason i bring it up is treasuries have continued to befuddle many. the big glide path of interest

rates on sovereigns is tidictat by soft global economy. that doesn't mean there isn't going to be stretches where it tightens up a bit. we had a guest today on from pimco talking about any kind of inflation expectations, yields are too low. but we're not closing below 2% today anyway. >> marianne, we're talking about the geopolitical effects on oil. why do you imagine gold is not going higher at this time? i mean, is it this disinflationary impact we're seeing around the globe? you follow the technicals on this kind of stuff. what do you think is going on? >> depends on what currency you're looking at. dollars is not moving. euros anden e yens you get a completely different picture. it's the currency. what's going on with the markets i think if you take a big top-down macro point of view is profits drive stock prices. if we look at global indicator, global indicators are turning negative. they started turning negative of this year. if you look at earning estimate

revisions they're still coming down globally and coming down in the u.s. at the same time, what i don't hear you talking about is credit splits are glowing out. you've got the high yield market blowing up. as long as that continues, that's going to bode volatility for the equity markets in our view. >> and david, you know, we've talked for years going back to financial crisis about the recovery play. you know, it was the fed does its part, you trade stock, you hold them, you love them. what paradigm, david, are we in today? >> well, we're in a paradigm where i think the qe-driven forces that were behind that 5 or almost 6-year rally in stocks are kind of behind us. we're talking about the exit. one of the things we've talked about all year, jeffries is how this year of transition away from qe, and away from the ma massive levels of oi come dags is going to be a test tort s&p and the u.s. economy. it's turned out really to be that way. it's been a higher volatility environment. a lower return environment.

and the belief system that's been driving equities, which equity market always need a belief system, has really been centered on this monetary policy. it hasn't been centered on the communications and energy. >> going back to what mary ann was saying, the junk bond yields are moving higher. when that happened the last couple of years the response from the time often from the fed was talking about easing or going quantitative easing, david. this time around they're moving the other way. >> yeah. >> there's a problem there. >> well, i think there's an issue because the handholding is gone, right? now it's time for us to kind of go off the medicine and do it on our own. a lot of people are worried about how the u.s. economy will perform like that. i think in general i'm not as bearish as the other guests on here about the u.s. economy. i think we've done pretty darn well. we've had 2 quarter% growth. great automobile numbers today. make 2:00 jobs a month. it's not the end of the world. it's just a scary time when you lose the monetary policy.

>> i would agree with that. the u.s. economy is perfectly fine. it's being held up because of the consumers. >> the economy is not the market as we like -- >> if the economy is so fine, why did they raise a quarter point last week? here we go back to the same conversation. it's fine, it's fine, it's fine. it isn't fine when it comes time to act. i'll never say 2 1/4% gdp is fine for the united states, the premier economy in the world. >> jp morgan today marked down gdp estimate from 2% to 1 1/2% on foreign trade. the slowing global economy, mary ann is having right here. >> absolutely. markets hates uncertainty. it's got uncertainty on not only u.s. gdp growth but it's global. they're responding more to global gdp. it has uncertainly about what the fed is going to do. this is the first time in my career, started going into a very important fed meeting and the market not really sure what the fed was going to do. you knew somebody was going to

be unhappy about it. and you would get volatility within the marketplace. >> first time in a while they were disappointed a full punch bowl was sit stlg in the middle of the table. >> absolutelied. and it didn't help they lowers the forecast for gdp. >> you tweeted out, steve, you would sell any rally right now and certainly that's what exactly happened today. what kind of levels are you watching here as we go out? >> everyone looks at this and always say, oh, my god, is market is going up. if you look at the s&p cash, we can balance all of the way to 1940 to 1965. that's where you want to be selling if you sell at this level and buy it below 1900. i would still be a seller as i've said of any rally. >> thanks, everybody. great discussion. leave it there. >> good stuff. breaking news on those september auto sales. phil lebeau, how do they look? >> this is something we haven't seen in more than a decade. september auto sales rate, 18.17

million vehicles. that's according to auto data which is crunching the numbers i've iry month. auto data says the sales rate of 18.17. strongest since july of 2005 when the rate was 20.6 million. guys, we've heard a lot of people talk about the sales pace for the year being maybe 17.2 overall, 17.3. this strong number for september might have people saying perhaps, perhaps all of 2015 could eclipsed the all-time record of 2,000 when the total sales were 17.4 million. still three months to go but this was a huge number. much better than people were expecteding. >> phil, it's so extraordinary to think back a couple of years when people. >> reporter: saying maybe the industry never comes back. it's only going to be $9 million, $10 million sales rate. ford doesn't need that anymore because they're going to be profitable. you would think their shares are exploding to the upside given what we have seen.

>> it's the multiples. when you look at any of the multiples for the auto sector, they get no love at all. and people talk about, well, you need consolidation, maybe you'll get love after consolidation. it certainly isn't because of profitability. mary barr is holding an analyst meeting outside of control and came out and said we're going to have double digit growth in their earnings, generally. double digit growth, that's something general motors hasn't done in history. >> a lot of that, too, global concerns. what's happening in china, what's happening in europe, an important reminder right here in the u.s. >> that's why i hear rk still asking why are they not raising rates with a number like that one. >> phil lebeau with those numbers there. 18.2 just about, the sales rate. 45 minutes to go here. s&p has turned positive. nasdaq down by five. coming up, a leading russian expert will give us his take on the potential fault lines developing in russia's syria

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we are watching a market that was much lower earlier, down 211 points at the low of the day. now down 32. the s&p has turned slightly positive. and the nasdaq is down 5 points. a few stocks we're watching. dunken brands just getting crushed. down 12% after the company forecast lower than expected third quarter same-store sales at dunkin' donut chain. also planning to close 100 dunkin stores at speedway franchises. nigel, ceo of the company, we're trying to call you. >> remember back when we were talking about baskin-robbins, how ice cream was an interesting growth of business over their summer. breaking news, auto sales for september surpassing 18 million at a run rate. numbers fueled in part by improving economy, low gas

prices. and maybe we should mention pretty cheap credit for buying a car these days. >> i have another theory, too. let's do it. more we bring back phil lebeau and brian, auto and capital equipment analyst. good to see you both. what do you make of these numbers here, brian, and that we saw today? >> well, i think it's a continuation of what we've seen. it's a tremendous buyer's market right now. got an improving economy. the job picture is getting better. financing remains incredibly favorable. away from that we've got a 250 million car on the road in the u.s. that are 11 1/2 years old. pent up demand there. and finally low gas prices are really contributing to what we call positive mix, more crossover, suvs, and pickups being sold. >> that's what i was going to point out. i think there's been a lot of pe pent up demand from the financial crisis and people feel more comfortable buying and going to trade in that 10-year-old or 15-year-old car to buy. the question is if that's what's

going on, how long can this kind of boon last, do you think? >> every time we get a great month out of auto sales the tendency has been to sell the automakers because the idea is that we've reached peak auto sales. i think we're going to be at a plateau in this 16 1/2 to 17 1/2 million range for some time provided the economy continues to kind of jug along at a low single-digit pace. from 1997 to 2007 we ran it around 16 1/2 million units per year. this is not too far away from that. >> phil, i know we talked about this a little bit before. but the key question is 18 million different this time around? in 2005 when we hit 20 million over the summer, huge incentives. prior to that the economy was booming. the workforce kind of growing, supporting a lot of people buying new vehicles. is this time different? even if we're at a plateau that itself is going to be extraordina extraordinary. >> if you're not seeing the level of incentives that we saw

back in 2005 or even around 2000 or 2001. remember back then, the big three were losing market shares so quickly that the only way they could keep their factories moving and cranking out the trucks, the suvs, and the cars that they needed to in order to sustain the uaw contracts was the throw more cash on the hood. it's far different now. this is a market that is now led by demand as opposed to supply being pushed out there and massive incentives really saying to people you may not need a vehicle but, boys, these deals are so sweet. come on in. that's what we saw the last time we were at these levels. >> i was just going to say meantime when we were talking to brian kelly on "fast money" about this but if this is pent up demand, if it's not sustainable for factors that we've discussed that it is going to a real problem for an industry that's getting pretty used to enjoying this kind of production and this kind of capacity. >> well, just to -- first, i

agree with everybody that phil said. he's 100% right. in order to cover this industry you also have to be a historian. but i think one thing is the value proposition to the consumer right now whereby the vehicles, whether they be small crossovers, mid size suvs, are offering fuel economy that used to be seen in small cars. so i think that apart from the economy improving and apart from there being some incentives, not like we used to see, i think the value to the consumer significantly better than it was at any point in the past. >> brian, before we let you go, let's make this meaningful to investors. these sales numbers are not reflected in the stock prices. you don't get the kind of response you would expect. are there automaker use guys at gabelli like right now more than others? >> we tend to look at the supply base and the dealers. but then the supply base you can pick your technology. we've certainly seen with voeks kag gone mission standards are only going to get more strict over the course of the next

deca decade. so a company like tenaco out of illinois, their shares are actually hit on the news. it's a great company, tremendous cash flow generator. they make emission control contents that are set to help light vehicle and commercial vehicle manufacturers. >> got it. good to see you, brian from gabelli and company. phil lebeau, great to see you as always. 35 minutes left in fact trading session. the dow is just sitting there now. it's kind of like hurricane joaquin, it's just not moving. but we're down 37 points at the moment. s&p is down now below the unchanged level. and the nasdaq is down about five points. up next, why tech may be the place for investors in this fourth quarter and which stocks are the key drivers. plus, as you know, russian and u.s. fighter jets have been sharing syrian airspace and that may be putting the markets on edge. each country is forging an anti-isis strategy but with very

different end games. a russian expert will join us a to talk about what to watch for in the coming days. that's coming up on "closing bell."

welcome back. 30 minutes to go in the session. the dow is edging lower here, down 50 points. s&p back in the red. the nasdaq down about nine. now, take a look at twitter. shares really losing ground today. now, remember, yesterday they spiked on a re/code record that cofounder jack dorsey would be named permanent ceo.

now twitter shares are down 8% on no news. so what are investors thinking? re/code's update to that story says it's not clear if the board is actually voted on dorsey's appointment. that's because it's still settling the status of other key executives, bill. if this is a shareholder base, it tell yos you about how influential he is over the share price in the last 24 hours. >> a lot of whiwaiting. new day, new quarter. josh lipton says there is one sector that historically performs well at the end of the year. pretell, josh, which one is it? >> bill, historically tech investors have had good news in the final quarter of the year. s&p capital iq tells me since 1990 the tech sector has climbed an average of nearly 7% in q-4. the sector up about 80% of the time. now we know tech just dropped about 4% in the third quarter. but that should not worry

investors. since 1995 the tech sector has actually climbed an average of about 5% in q4 after falling in q3 and rose 70% of the time. as for s&p's top tech picks right now, they include alliance data systems, a company that processes data for marketers. sim mantic and xerox where xp thinks the company could split in two creating value for investors. you might think given those bullish historical patterns that stovall would be overweight tech as a sector but he's not, he's neutral. that's because he says the sector isn't cheap right now. trading at about 16 times earning. that's roughly in line with the market. kelly, back to you. >> joshua, thank you. another reason to watch tech here. >> yep. let's get the latest on the deadly shootings in oregon now with our sue herera. sue? >> thank you very much, kelly.

a very fluid situation here. the breaking news out of oregon is now that nbc news confirmed 7 to 10 people have been killed following a mass shooting at an oregon college. an additional 20 people have been injured. oregon's office of emergency management says the attack was carried out by at least one gunman and that one shooter is, quote, down. authorities began responding to reports of shots fired at umpqua community college just after 1:30 p.m. eastern time, 10:30 local. the ended up being taken to mercer medical center which tells nbc news they're in trauma status. the douglas county fire officer says the scene involved multiple injuries in multiple classrooms. police are evacuating a 1 1/2-mile radius around the campus which is about 180 miles south of portland. it's a very rural area. the fbi and the atf are on the scene. we're continuing to follow this, but bill and kelly, i can tell you that nbc news has learned

that mercy medical center is not a stage one trauma center so life flight reportedly is going to be taking several patients to sacred heart hospital which is in eugene and sacred heart now confirming to nbc news that they will be receiving at least three patients, but there is no word on what their particular status is. so the numbers keep changing but we do know that nbc news has confirmed at least seven, possibly as many as ten, dead. back to you. >> awful. all right, sue, thank you for now. we will keep checking on the latest developments on this story as they develop. we have about 30 minutes to go here. dow is down 57 i understand ppo. the nasdaq giving up 12 points on the session today. a top trader will tell us what he is watching as we head towards the close on this first new trading day of the quarter.

welcome back. with about 25 minutes left in fact trading session, here the dow is down 52 points. was down 211. we opened with a pretty good rally this morning but then sold out quickly. oil went lower as well. we had volatility on this first trading day of the new quarter.

kelly? >> an hour to go here. let's talk to down on the floor with me from deep value, sarge, if i may. what's going on with the market today? >> it's almost like the markets impervious to headlines today. for the s&p 500, a double bottom at 1901 and a top at 1921, seen resistance six times already without breaking. >> this morning it made sense. you had weak economic data, ism numbers. marco is down 2 pun plus at the lows. oil is getting hit. this afternoon, it's different. oil is back to flat for no reason unless you're aware of somethi something. >> it's almost like this morning they bought up oil because of what's happening in syria. and now maybe the oil is not going to be impacted by this very much at all. maybe this isn't an issue for oil, at least not today. and it's back. it's flat now in a day. >> meanwhile, some of the

sectors like 45ehealth care is well. do you think people are rebalancing? >> there was some out flow and funds pertaining to health care last week. we saw that because of a whole hillary clinton quote. but you know health care has -- this is going to be a quarter where we have rough earnings probably. health care has revenue earnings flow. so maybe on the dip here health care is not a bad idea. >> we'll leave it there for now and let you get back to it. bill? >> let's talk about this. russian airbor strikes in syria already causing tensions. earlier today during white house press briefing secretary josh earnest was asked about it. here's what he said. >> by wading more deeply and carrying out military operations indiscriminately against the syrian opposition they're fanning the flames of the sectarian conflict. and the point that i'm making is

that russia will have to pay the costs for that. >> joining us now to talk about the greater implications in this is alex from the eurasia group, russian expert there. is he right? i mean, certainly there are so many conflicting, complicated relationships involved in that region of the world, are they making things better or worse by taking this active action now? >> certainly the u.s. hasn't done very well trying to play that game. but, look, the issue in syria right now is that russia and united states fundamentally sdis agree about what's going on and what to do about it. isis is a regional threat with global implications. what they disagree on is how to deal with that. the americans say in order to deal with isis you need to weaken and remove assad first. the russians say, no, to deal with isis you strengthen and secure assad. >> doesn't this predate isis? the conflict in syria itself? >> look, five years ago there was no isis in syria.

the reality is that now there is. >> that's my point. if you think about what america is after and what russia is after, who is to say they have anything to do with one another. america may want global stability. russia very well may not. >> right. there are certainly differing views between russia and mass coon global issues and security. the fact of the matter is right now the misagreement is what to do in syria. >> why is russia involved in syria? what possible interest does russia have in syria other than seeing an opportunity to exploit? >> everyone sees an opportunity to exploit in syria. that's why they're there. it's to make themselves the indispensable partner for sorting out syria which has implications not only in the middle east but for europe. one of the things that russia is trying to do is to make itself indispensable for syria which has implications for refugee crisis in europe and try to get out of ukraine sanctions.

>> the offer there players, saudi arabia, financing the rebels in syria. the iranians are amassing troops along there. so i mean, you have more than just u.s. against russia here as well. >> right. it is a kaleidoscope of competing interests and overlapping interests. and part of the problem is that outsides fors that get involved need to define their interests clearly. from the u.s. perspective is it the democracy agenda to get rid of assad or stability ajebd do to restore assad and bed rget r isis. >> in the meantime what happens if there's strike by russia that hits some u.s. interest, if there's some event in the air, some collision of some sort or is it that the mere fact that could happen is going to drive america out all together? >> miscalculation is a huge concern here. right? i mean, the possibility of, you know, the americans and the russians are working to do what they call difficult con flikz

now. decon flikocon flikz. >> are we over thinking that though? i mean, i don't -- i'm certainly not an apologist for vladimir putin but should we take him at his word of why he is there and not be so skeptical and be so concerned about the possibility of a russian/u.s. conflict in the air there? >> right. look, the u.s. basically has two options right now, broadly speaking. one is to bend to the russian position which is, okay, we leave assad in place for a while longer and focus jointly on isis. the other choice that u.s. has is to massively escalate its own involvement in order to weaken assad and drive him out of power. both options are unpalatable. if you bow to the russian position it makes the u.s. look weak. embarrassing. if you decide to escalate in syria, you know, you're running to risk of a catastrophic escalation in hostilities and a possible direct confrontation between u.s. and russia and syria. >> do you expect then that this

is all going to be in limbo for the next period between now and the election as the white house has to basically hand off strategy to what could be a totally different party with a totally different approach? >> i think we will be in limbo on this for a long time. the russian strategy is to basically end one of the two conflicts that assad has right now. assad has a conflict with syrian opposition rebel forces and isis. what the russians are trying to do is end the first conflict decisively. remove discussion of assad being over thrown and then possibly turn towards isis. that is an outcome that will take many, many months if not years to materialize. >> alex, thank you. >> yeah. i suspect we will be tacking again. >> my me supleasure to be back. a little more than 15 minutes to go into the bell. the first trading session in the month of the quarter has the dow down 76 poiptsz. temperature 4, and nasdaq 15. hedge fund showing less than stellar performance in the third quarter. we're going to look at the

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welcome back. dow is down 55. s&p, 1. nasdaq, 7. there's a look t the dow 30. in fact, 2-1 decliners to date. caterpillar the worst performer. on the flip side, home depot and goldman up 1%. jpmorgan on positive territory. nike and disney having a pretty good session. today is the start of the fourth quarter. hedge funds are hoping it's going to be a better one than the last. morgan brennan is at global headquarters with numbers on how that third quarter did for them. >> that's right. september was a ruch month for hedge funds. just for some reference the s&p 500 fell 2.6% in september. it's down about 6.7% now for the year. but take a look at david i horn's green light capital. it's down 17% year to date. some of the names that weighed based on top holdings at the end of june. sun edison which plunged more

than 30% over the past month. consu consul energy which is down and micron technology which lost almost 9%. all of them down by large double digit percentages for the year as well. look at barry rosenstein's fell 8.8% in september. down 6.6% year to date. now, qualcomm, hertz, valeant, top holdings in june 30th. biggest losers with monthly losses for these stocks rang ming 5% to 23% last month. lastly, daniel lode, down 1.3%. . in other words, losing less than the s&p 500. two drug makers among the biggest culprits there. amgen fell 9%. a and andallergan tumbled. 12 minutes to go.

bill, how is this market? >> it's coming back. i'm watching for art cashin to come through here and tell us what the bias is. so far haven't seen him yet. we'll see as we head towards the close on what has been another volatile day for the markets. it's usually at friday at this time when we say if it's friday it's david doris but this week we get his take on the market's action a dale eay earlier. you're watching cbs first in business worldwide.

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welcome back. ten minutes left in the trading day. dow opened higher. up 64 points at the peak. but then down 211 points. and now we've come back some. down 34 points. art cashin was telling us we have 300 million to buy going into the close. a minor bump maybe coming into the close here. joining us independent investment consultant david dorst. happy thursday. what do you think as we go into the quarter here? we were just talking to the gentleman about russia and syria. will that eclipse, do you think, some of our economic concerns here in this country as it pertains to the market sfs. >> it could. as you mentioned, bill, that could be another reason for the fed to ease.

my takeaway from the fed -- >> not tighten. >> ease further, not start tightening. >> right. >> my takeaway was forget about housing and the unemployment rate, which was the former fed benchmarks as to whether they were going to start tightening or not. they say instead we're looking at china and inflation. the inflation numbers that are come in this week have been also to the weak side. and in europe also minus 0.1% year over year. i think we've got to look at the fed's message, which is they could continue not -- continue delaying. secondly, be selective in reits, mass or limited partnerships. energy, you could nibble at energy. the largest european energy company, one of the three big majors with the two u.s. ones, it yields 7.8% right now. and they just announced they're going to stop drilling in the arctic. does that mean they're going to keep the dividend? number three, we like, i like europe and japan. number four, you want to

basically watch credit, currencies, china, crude oil, and corporate profits. the five cs. and finally, go with what's working. we said this a week ago. home furnishings, distillers, footwear, toys. go with what's working. don't try to catch a falling knight, especially in the health care area. in 1992 bill clinton was elected. 4is wife 1994 headed the commission on the health care. going to reform the whole health care. health care stocks dropped 50% and people who tried to grab them too early got burned. let this thing settle. same with commodities with the exception of your brilliant call of having alex here a minute ago on the syria situation. that could get people worried and cause oil market instability. >> you saying though, david, tomorrow's jobs report in a sense isn't that important? >> it is very important. i think very, very important,

kelly, for consumer confidence. housing is okay. jobs are okay. confidence is mixed. the conference board -- >> fickle right now. >> -- was 103 but the consumer sentiment if which michigan takes twice a month is not okay. so jobs would be more for its headline effect of putting people in a better mood. my view is this is going to be a replay of 1991 in which we have a melt up in the fourth quarter. not a melt down. >> all right. you are the second person i've heard make that comment today, that that could happen. we will see. >> who was the first, bill, you? >> no, no, no, no, no. someone else. >> all right. >> thank you, david. good to see you. we're coming back with a closing countdown. bob and i will review some of the charts from today's trading. >> after the bell, more of john harwood's speak easy with the donald trump, telling john he's more than just a presidential candidate. he's a movement. you're watching cbs first in business worldwide. i'm here at the td ameritrade trader offices.

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afternoon. let's see if we finish positive on the close here. crude oil had a similar situation. it was higher early on. and then fell just -- especially here before the settlement. in fact, it settled -- here's the settlement right here. near the low of the day. it's down a fraction right now at $45. $45 level has been a critical level for a lot of people to watch there. one more of the ten-year yield at one point today hit 2%. almost got below that number. but we've held there and we're at 2.04%. so -- what do we say, a lackluster start to the fourth quarter. >> it's good that we came back. but what you wanted to see here was was a little bit of buying enthusiasm in the beaten up groups. put up the etfs that are active today. you want to see buying in the beaten up sectors. energy, for example. materials and industrials. the energy sector was down something like 20% in q3.

materials were down. i have -- i don't have the number here. 15% paul ryor 18%. you would have thought you would have gotten more enthusiasm. industrials were down 7% or 8%. big global names were down 11%, 12%. i sound like i'm complaining a lot but you would have thought there would have been a little more enthusiasenthusiasm. they did turn around biotech. ibb got beaten up badly as well. >> the volatility of august shook out by the dippers. right? >> exactly right. >> they're not buying the dips anymore. >> so people have been asking what do we need to get the market bottom. october is the month the markets bottom. obviously you need some stability in china. obviously you need some stability in oil m and the dollar. now, oil and dollar have been a little more stable recently but you and i both know it's been very tentative feel to it. so i think we need to see those three areas for sure. >> what's going on in syria is not going to help. >> no.

global events as well. of course, a little bit of surprise on earnings. that would be very nice. >> thanks, bob. see you later. >> two things to watch for. earnings from micron technology coming up momentarily. that could be very interesting to give us an idea of the shape of the technology sector. and don't forget tomorrow's jobs number out at 8:30 a.m. eastern time. stay tuned now. second hour of "the closing bell" with kelly evans. thank you, bill. welcome to "closing bell," i'm kelly evans. the dow almost turning positive but not quite getting there. down 13 points. the s&p did go up four. the nasdaq adding seven. that means we came back by 211-point deficit on the dow. meanwhile, watching crude oil closely. trying to make sense of all this on the first trading day of the fourth quarter. joining today's panel elon moy of the "washington post" and also with us more on today's market action is "fast money"

trader guy. s stephanie, what do you make of trading today? it's like a world of its own. >> lths in a world of its own. it's very volatile. i kind of sense it was a little cautious today. even though we ended up and came back from being down. i got a sense people are waiting for the jobs report, waiting for earnings. of course getting any kind of clarity from the fed. longer term. i think that's really kind of the theme for this whole week. so we're going to be up and down. see what happens 20tomorrow. >> if you want to call it the market sees on the bad news, the fact the ism manufacturing index almost went into contractionary territory, the yield is down 2%. the market was down almost 200 points. that conviction was the word i was looking for, more asserted at the beginning of the trading session than at the end here. >> i think it's interesting is that what you're hearing out of the fed is more optimistic outlook for the economy. you're seeing a little bit of disconne disconnect. markets are fearful of the international global outlook.

the message from officials is there is a distraction. we had comments today from san francisco fed president john williams in which he was going to lay out the case for, hey, even if we see bad data, a slowing jobs growth number, that's actually sort of a good thing because it means the economy is no longer running over potential because he said that if you see job growth at the level that we've seen over the past year, if you see economic growth at the level we've seen over the past year, the fed will ends up overshooting the inflation target. you start to see a little bit of the case being made. >> how can you talk about worries over overshooting? nobody, not consumers, nobody in the market, nobody think is fed is going to overshoot the inflation target at this point. >> i think rick santelli was talking eight not too long ago, as a matter of fact. the point being you're starting to see the make the case for the fact that bad data would not necessarily be a reason to delay. >> the data wasn't bad today. >> coming into tomorrow. jobs report. >> the pmis was a relief to many

people, right? ism, i think people thought was going to go below hift and it didn't. auto sales, 18.3 million. it's not all bad. it's just not -- i think it's just uncertainty. >> to the point ylan is making, the numbers are good but it's going to raise eyebrows. >> stephanie said it, surprisingly great. i think we would all agree, depending on what your dogma is, you can make your numbers look great or lousy, depending on a which side of the fence you come down on. the point is, stephanie just said it, it's just sort of a amalgation of a lot of numbers. battle lines are being drawn. melissa asked tom on a scale of one to ten how bullish you are on a market? he said i wish it were an 11 to quote "spinal tap," i would give

it an 11. so i think the battle lines are being drawn. what's going to be the ultimate like of demarkation, come in the form of earnings. again, i believe the companies are going to have to prove themselves not on the eps side because we all know how those numbers can be somewhat manipulated. it's going to be on the revenue side. we will see if that measures up to where analysts think they should be. >> again, we're going to get into the thick of earning season here. in the meantime, we have the ten year, other gauges to look at. you want that to see that yield fall down towards 2%. it's not rational if anything that we're seeing the economy having footing and being strong and inflation finally picking up. if any of those things are going to happen that yield seems way too low. >> seems way too low but we have to get clarity on the fed. as far as the fed didn't do anything, right? the ten-year yields, it fell. it lost support. you need clarity from the fed, you need a good number tomorrow. a very good number tomorrow, i would argue. >> is that like 250,000,

stephanie, jobs added? >> something like 3. i'm not thinking we're getting there. >> right. >> i think that's what's going to really get people to start to think, okay, now the fed is going to do something. not in october. probably happen in december. right now december is still very iffy. >> december 11th, ylan, we have the next deadline for the continuing resolution. keep the government going. that's four days i think before the fed's meeting begins? >> i'm arguable sides of coin here which is the best case scenario, everything is wrapped up before the fed meets. the worst case scenario, likely worst case scenario is that we're actually in a government shut down at the time that the fed meets. >> can they meet? >> the fed can still meet. i don't receive economic data but it seems optically like a wrong time to raise rates if you're actually in a government shutdown even if there is no long-term economic impact from it. fair enough. let's pick up with thee earning. josh lipton has the numbers. >> kelly, micron just reporting

so let's get you the numbers. 37 cents on 3.6 billion. the street was looking for 32 cents on 3.55 billion. looks like gross margins clocking at 26.9%. analysts had been looking for 26.7%. that stock heading into the print year to date had been down about 60%. listen, plenty of bulls also. barclays initially a homework kron and overweight talked about how the stock now looked cheap. at least based on certain metrics a lot of near term risks had been factored in. this conference call starting at 4:30 p.m. eastern. we'll be on it and bring you headlines. >> josh, thank you. micron shares responding to that report, stephanie, up almost 4%. what do you make of it? >> we all know how bad pcs are. expectations were so low. if you look at tin tell and hewlett-packard and the pc players. stocks have actually been bouncing recently. so expectations were extremely,

extremely low for this one. and clearly they beat those low. >> intel had great close at the quarter yesterday. >> intel is a good stock in this whole downturn, in this whole volatility. it's actually done quite well. i think, pcs are not that bad. they are bad but the stock is reflecting that. >> guy, nobody is accuse of having great sentiment around the pc space. is this a case of clearing the lower bar? >> it has traded, out performed over the last couple of weeks. in terms of micron in a vacuum, so we have to wait to hear what they have to say. in a vacuum this quarter is good enough to get a relief rally in the shares. beat on the top line and bottom line which is a good sign. let's see what they have to say going forward. people will talk about valuation of micron, i get it. i need to know where they think deram prices are and in fact if we bottomed out on those fronts. and quickly, real quick, just getting back to the fed, i don't think it mattered what the fed did. i would push back to stephanie and say they might control the front end of the curb but they

have no control ten years and out. i think the bond market is trying to tell you something. fed, you can say what you wantn't the fed. the bond market has been trying to tell you something entirely different now for 18 months. they can raise, not raise, whatever they want. the ten-year yields are telling an entirely different story. >> i would say it's confidence. not knowing what the fed is doing in the uncertainty has led to kind of people wondering what they're going to do. the timeline, bejust don't know when it's going to be. just get good communication and maybe just a single person communicating from the fed and not all of these players, which is not going to happen, but all of this discussion is so unnerving, to be honest with you as a portfolio manager for the long term. i agree with you, guy, that they control the short end but i think that confidence would actually be very positive for the long term. >> here's my per speush back. if you're unnerved by their lack of communication or lack of clarity, then you have to ask yourself, what do they say or

what don't they see that allows them to be as forces them to be as unclear as they are? maybe they see things that are more dire than the market until recently -- >> i don't know. >> -- seems to indicate. >> what's unclear, i think the point is that the fed hab has used a tool called forward guidance in order to provide certainty to the markets. as you get closer and closer to the data liftoff the more unp unpredictable it is. the fed didn't spell out every move that it would make. so you wonder if market participants have just become too accustomed to having the fed layout a road map for the future when one is no longer necessarily needed or one is no longer needed in that level of detail. >> in the end, is there enough slack in the system or not, period, really. that's what they think they have enough slack in the system to wait and be data dependent. so i don't like it. you don't like it, guy. none of us really like it. it is what it is unfortunately.

>> before we go, stephanie and guy, where are you putting your money in the fourth quarter. stephanie, first, you? >> i like technology. i like cloud. i like software security. i like the chips. picking a little bit of energy. i think it's more of a 2016 storely but i think you're getting good bargains here at this level. i still like consumer. >> guy? >> two names. facebook and their earnings, they report on the 27th of october. that stock has held up reasonably well. i know it sold off over the last couple of days. i think they're going to crush it at the end of the month and i think goldman sachs is set up not only to crush earnings given the market volatility. i think the stock will act in kind given the sell-off down in the low 170. those are two names to watch over the next couple of weeks. >> already seeing positive action today. guy, thank you. >> later. >> more coming up on "fast money" at 5:00. solarcity down 20%. they will be talking to lyndon

rive tonight. find out why william lauder believes in the china consumer. he will join us. and then oak tree capital management co-chair howard marks tells us where he's finding opportunities in this uncertain market. you're watching cbs, first in business worldwide. while every business is unique,

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wrk back. news alert on amd. josh lipton, what can you tell us? >> kelly, these headlines just dropping here on advance microdevices. amd saying it's going to cut about 5%, kelly, of global workforce. that appears to be about 500 people. companies saying it's going to record restructuring and asset impairment charges of about $42 million. amd also saying it's going to anticipate savings of about 58 million in fiscal year 2016. the stock not doing much here in the after hours though. down about 35% so far this year. kelly, back to you. >> pretty lower thetory. josh, thank you very much. china has been a major cause of turmoil in our stock market of late. but what else can the chinese do to prop up the economy in the fourth quarter? seema modi is looking at this for us. >> in the china pmi number caught attention of investors

today beating expect tagszs but still below 50, ibd indicating contraction. as you point out the chinese central bank has been unveiling a series of measures to kick start growth. five interest rate cuts, three triple reserve cuts since last november which basically gives banks greater flexibility of how much reserves that they have to hold. they boost exports and created quite a stir among global investors in august. all of this so far has had limited impact on chinese growth. prompting many economists to think what else is left in the pboc's tool box. here's what a number of economists have told me that we could see in the fourth quarter? another interest rate cut, reserve requirement ratio cut, further moves to deval the juan and other quaund tative measures to maintain stable liquidity. the question is, will this feed through to the real economy and when, lindsey group says these types of measures could take up to six months. we're looking at mid 2016 when

we could start to see improvement in chinese economic metrics. the other question is whether china will try to limit a further decline in stocks. the chinese stock market losing about 28% in the third quarter. i've been speaking to some portfolio managers in china who said we could see more of the same if we continue to see further volatility in q4 limiting short selling as well as margin calls. that's something to watch as well. kelly? >> indeed. seema, thank you. seema modi. luxury cosmetics giant estee lauder says while volatile still seeing consistent growth there. joining us now in a first on cbs is executive chair of the estee lauder company william lauder who just moments ago rang today's closing bell. wall street to "post 9." >> thank you. >> tell us about china. are you seeing a china more like nike which reported strong sales in the consumers there and finding demand or is it as rocky as the markets brought more broadly seem to reflect? >> the best way to characterize it is china is not as good as it

was but still very good. if it wasn't china, if it was europe or north america we would be dancing and saying aren't we fantastic. while china is not as great as it was it's still a healthy growth rate in demand. what we are seeing is a change in the traveling chinese. there's not as many traveling chinese so we're seeing in places like honk to think, taiwan, travel retail, somewhat of an impact. let's put it in perspective. china represents 6% of global scales. all other emerging markets come bibd, grew 26% last year, is greater than business in china. >> is that a positive or negative in today's environment? >> a positive. we are very diverse business. china is now third largest region in the world, if you will, if we just look as china as its own region. even is that is only 6% of total. very diverse broad based business which represents business in so many developed economies in the world. >> are you seeing the chinese consumer trade down? i know you don't have a lot of lower end products. much more upscale. but are you seeing the chinese

consumer maybe changing their patterns in terms of what they're buying? >> the main pattern change we see is i would call it a migration pattern. they're buying more at home, they're not buying -- not as strong abroad. so their presence in markets like hong kong, paris is not as great as it used to be. they are buying more at home now, which we find as an interesting pattern change. largely because they're not -- you're hearing for example the plaeps are not quite as full coming out of china to the different at spots. not as many in san francisco, new york, and other gateway cities, toronto, vancouver. there are still some patterns that you see but it's more of a mike gratory pattern, not really a price trading pattern. some still continue to do well but aim at the tippy top of the market. we're seeing great growth from brands that we've seen price adjustments ourselves. >> you've cut prices. >> we've cut some prices because there was a very big gap and that gap was driving an

artificial wedge where it was literally worthwhile to shop in lower currency overseas markets and bring it home. >> are you going to don't cut prices and is the chinese currency moving with that? >> we think the pricing is right versus u.s. dollar, u.s. pricing which is the benchmark that that consumer uses. we think that that's right right now. but it's really we're doing to see. there's not a lot of room to grow. >> is there a different demographic in china purchasing your products? you have built retail stores throughout the country. how are they accessing it? if people are buying it at home is at this time same clientele buying your products previously or is it a brand new demographic of customers coming in to make those purchases? >> a combination of the two. as we expand deeper into tier two and tier three cities, two things are happening. number one, they're buying at home where they live as opposed to buying either remotely from shangh shanghai, beijing, hong kong, traveling family members.

as they buy more at home we're able to expand our base. that's no different than the patterns we've seen in other markets throughout the world through the history of what we've been doing for 60 years. as we make our brands more available the destination shopping where you travel further goes down and the total business goes up. it reapportions itself. we're 10 or 15 years ago just doing business in beijing and shanghai. now we're doing business in over 65 cities in china. >> busy travel schedule. >> yes. >> we want to point out the incredible work your family has done to raise awareness for breast cancer. pink tie. ylan in pink over here as well. >> fantastic. >> how global is breast cancer awareness, especially in levels in this koucountry has grown he. what's the situation in china and where do you go next? >> our campaign is raising awareness of breast cancer. it doesn't discriminate as to where you live.

not only awareness, talking about action. so we're going to these communities and saying, okay, you know someone who has been effected. what action are you taking to help them and family members involved. what are you doing to help the raising money so we can raise -- fund researchers to help find a cure? now, think about this. in 1990 if you were diagnosed with stage i breast cancer, 75% chance of survival and next six to nine months or more of your life is going to be rough. chemotherapy, lose your hair, not go to work, weeks in the hospital. today, 92% likelihood of survival. chances are likely if it's caught early enough. no chemotherapy if very targeted radiation. a bump in the road. you won't spend a night in the hospital. you will continue to be with your family and go to work. this all comes because of the brilliance of the researchers t and the work they've done. >> what's the biggest challenge for that final 8%. in a sense, is it the continued funding of the research and development that needs to take place or some markets like china or others where the simply, you

know, the infrastructure isn't there in the way it is in the u.s. >> the health care train structure in china which is pay beyond my pay grade. i'm sure that's quite complicated. if you go back 2 years ago when we first started the breast cancer awareness campaign, bringing breast cancer out of the shadows into the light was an important aspect so women would be comfortable discussing it instead of it being embarrassed about the discussion. that's certainly happened and it's now it's all about openly pursuing cures and the collective activism. and now we're looking at social media which really brings a whole different perspective to how people interact and talk about those issues that are important. so a lot of what we're focusing on now is to engage on social media community, get people to embrace, take action. we hope it gets viral so it's not just, oh, i know about the disease. yes, one in eight people are effected you know someone who has been inexpepektineffected b disease but what are you doing about it? >> thanks for joining us.

thanks for the work that you've done. executive chairman offest see lauder. auto sales are speeding up. we're going to talk more about that next. plus, find out how the insurance industry is bracing for hurricane joaquin. when we speak exclusively to the ceo of excel group coming up.

welcome back. news on nordstrom. seema modi, what can you tell us? >> $1.8 billion of net proceeds to be returned to shareholders

through dividends and a share repurchased, that's the announcement. breaking that down, $1 billion buy back and $4.85 special dividend. that's the announcement coming out from nordstrom. up about 3 1/2%. >> seema, thank you. couple of different things here going on from nordstrom. what do you like about it? >> this is the year for nordstrom. after so many years they heavily invested in their companies and in their brands and expanding beyond just their core store base, right? and this year they're starting to see the results. and not only that, but they're really focusing on what they do well. and so getting rid of a more riskier part of the business and then using it for shareholder value, that's great. that's a fabulous idea. >> return to shareholders. $4.85 special cast dividend. you know, billion net proceeds all together once you add in that share buyback of a billion dollars. >> they just reported earnings that beat expectations, gross

margins are going higher. this is a tough retail environment. and this company is not only executing on the fundamentals but now they're doing things beyond the fundamentals which is great. >> another consumer name working in this environment. auto sales shifting into high gear last month. phil lebeau is back with the details. hi, phil. >> kelly, first time more than ten years we've seen the sales pace go above $18 million for any particular month. take a look how far this industry has come if you go back to the low point, back in 2009. last year it was at 16.5 million. the pace for september at 18.17 according to auto data. that means when you look at this year we are on track for sales coming in at 17.33. the big automakers last month posting double digit gains. what drove those sales, three things stand out. first of all, labor day weekend was part of september. that is traditionally one of the busiest weekends of the year for the auto dealers. trucks and suvs because of low gas prices remain in demand. strong consumer confidence

helps. i also want to talk about volkswagen because there were a lot of questions approximately what's going to happen with vw september sales. they were positive. up 0.6%. most were expecting sales to be down 7.3%. so a slight increase for volkswagen dealers despite the fact that really for the last half of the month they couldn't sell about a quarter of what they usually sell, which are the clean diesel models. that said, they were only slightly positive in a month when the auto industry, boy, kelly, they racked up huge sales. 18.17 was the pace of sales. >> yeah. and i'm looking at ford, phil, where the truck sales jumped 23%. i'm wondering is this where those gasoline savings we've been looking for all year are going into consumers who want to buy a truck and especially want to now that gasoline is cheaper? >> there's a little bit of that. there is also a when you talk about full-size pickups, a bit of a truck war going on right now. you saw slightly higher incentives in pickup trucks. in part because you've got all three of the big three with

newer or new models that frankly are fantastic. even each of them have their great selling points. they are very aggressive right now trying to say to the truck buyer, come on in and take a look at this pickup. that's why ford, now that they have a full inventory in the dealerships. being more aggressive and it was reflected in the sales last month. >> phil, thank you very much. phil lebeau on auto sales. now let's get the latest on the deadly shootings out in oregon with our sue herera. >> the numbers are changing and not for the better. breaking news is this. nbc news pete williams reporting federal officials say now as many as 13 people may have been killed and at least 20 injured following a mass shooting at an oregon college. officials also telling pete williams the attack was the act of a single gunman who is dead following a confrontation with law enforcement. today's shooting occurred in the science building at umpqua community college just after 1:30 p.m. eastern time, 10:30

a.m. local time there. douglas county fire official says the kroo sent involved multiple injuries and multiple classrooms. the injured are being taken to mercy medical center which has received 12 patients. trauma center sacred heart in springfield confirms it has also received three patients and may be in line for three more. the white house says that the president obama has been briefed on the shooting and oregon's governor is holding a news conference any moment now and we will bring you the updates as they happen. so it's still a very active situation there in oregon. back to you, kelly. >> all right, our hearts go out to all of those involved. thank you so much. we'll continue to follow the story for you as it develops. also, next, howard marks of oak tree capital joining us to discuss this market.

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welcome back. here's a look at how we finished the day on wall street. the dow almost turned positive president down by 12. s&p did. brud index up four points on the day the nasdaq adding seven to kick off the fourth quarter. breaking news on a data breach. let's get to sue herera with the details. >> yes, it involves experian north america which announced one of the business units but not its consumer credit bureau,

experienced an unauthorized acquisition of information from a server that contained data on behalf of one of its clients. that client was t-mobile usa. and we're following the story because it's very interesting to see the fact that it was not their consumer unit. t-mobile says its ceo responding on experian's data breach. we've been notified a vendor that possesses our credit a my kagszs that they experienced a data breach. so t-mobile uses experian to process their credit applications. so it's going to be interesting to see how this story unfolds, kelly. but experian taking great pains to say it was not their consumer unit. back to you. >> we'll see if any other names are involved. thank you. several market voices have been urging the fed to get over its fears and raise rates and one of those foremost voices in favor of a hike is oaktree

capital cochair howard marks who joins me now. welcome to you. >> thank you, kelly. >> let's begin on that topic. i know we have the government shutdown potentially looming again right before the fed might be raising rates come december. why do you still think this is is a good idea? >> i think it's a good idea in principle. i'm not talking about specific timing. but i don't know if you're ever going to find a perfect time to do it. i think it's desirable. and it seems that there's always some reason not to do it. what about the reasons to do it? what about getting the government out of the business of regulating the cost of money? what about stopping to subsidize borrowers and penalize spenders and savers. and so in general i'd like to see it happen. i am not an i vider to the fed. i don't know if this is the time or not. >> i'm interested that you think, especially being such an active participant in these huge

markets, the fed has that much to do with the longer end of the yield curve which seems to react based on enumerable ids trtrade. you can have a very flat yield kur and that usually seems to reflect the broader environment. >> right. well, i'm not talking specifically about the long end. but, you know, i believe that the free market is the best allocator of resources. and we don't have a free market in money. and i'd like to have one. >> one of the reasons people say they want the fed to move is it will, quote, unquote, remove uncertainty for investors, howard. is there such a thing? and what are investors to do in this so-called uncertain environment? >> i think investors have to know that it's their job to bear uncertainty. there are two kinds of times. when the future looks uncertain and when it doesn't. i worry much more about the latter. when everybody knows there's uncertainty people behave cautiously and that tends to reduce risks. when everybody's confident the

future is bright and clear, they do risky things and tend to get into trouble. so bearing risks, bearing uncertainty doesn't trouble me. that's what we're paid to do. >> so specifically as you feel comfortable, what advice to dow you have to investors today? what kind of instrument should they be looking to in this environment as we now kick off the fourth quarter? >> i think the most important thing that an investor has to do at a point in time is to set the balance in his portfolio between offense and defense. not stocks versus bonds, large cap versus small, securities versus hard assets. offense versus defense. and for the last four years we've had a position, summed up by move forward but with caution. i think you have to balance the two. i think you have to favor caution. we don't know what's going to happen. the people who make the biggest mistakes are the people who think they know. henry kaufman and economists said two kinds of people lose

money. the ones who know nothing and the ones who know everything. we hope we know a little. but we've had a caution posture and we still do. >> so when you look at the fact that junk bonds are high yield as it's called today has been selling off aggressively, the difference between those yields and what you can get on u.s. treasuries has widened. >> yes. >> what does that tell you, either if you want to draw broader conclusions about it or just as an investment opportunity? >> you have two choices. you can draw inferences or you can look at the math. the inference is that things are riskier. the math is that there are better buy now than they were "x" months ago. i think it all depends -- i don't look at these things for a trade. if we bri high yield bonds it's because we expect to hold them to maturitmaturity. the yield to maturity is edge over treasuries is substantially greater now than it was three months ago. to us, that's very attractive. so not for a trade, not because they're going up tomorrow.

you should buy high yield bonds today if the yields are attractive to you and you can hold them to maturity. >> for a lot of energy xaeps a balance as to whether they can play that over time. >> that's the key question. i should have added you should look at the yields, see if they're attractive. assess the credit worthiness, which perhaps only professionals have the ability to do and even that not in every case. and then buy them if the yield is useful to you. >> are you you holding a lot of energy debt here? >> not a lot. not a lot. we've been under weighted in energy. it has been over the last couple of years the biggest sector of the high yield bond universe and we've been underweighted. >> looks smart these days. howard, thank you so much for joining us. >> pleasure. >> howard marks is the cochairman of oaktree capital. donald trump is never one to shy away from speaking his mind. up next, the presidential hopeful on his tax plan and take on party etiquette and hurricane joaquin is hurdling toward the

east coast. later we'll talk to the head of a major insurance company about the storm's impacts on his business. we're back in two. daughter: do you and mom still have money with that broker? dad: yeah, 20 something years now. thinking about what you want to do with your money? daughter: looking at options. what do you guys pay in fees? dad: i don't know exactly. daughter: if you're not happy do they have to pay you back? dad: it doesn't really work that way. daughter: you sure? vo: are you asking enough questions about the way your wealth is managed? wealth management at charles schwab.

welcome back. we gave you a preview of john harwood's speak easy with donald trump yesterday. now you can catch the whole interview on cbs.com and john joins us now with more from the donald. >> donald trump waited into the policy debate by releasing a tax plan this week. jeb bush said it looked like a

rip-off of his. donald trump told me, uh-uh. take a listen. >> jeb told me the other day that trump's strategy is to say things over and over, loudly. >> you're loud and you repeat something over and over again? you think that that turns it into truth. >> what do you say about that? >> i hadn't heard his statement. i think he's a very nice person. he's doing very poorly. he maybe will who at the timer. >> did you see what jeb said about your tax plan? >> no. >> he said i'm flattered. it looks like mine. he suggested you copied his and lowered the rates but said you should have tried fiscal spontsibility. >> certainly the last person i would want to copy is jeb. i think our economy will grow much faster with my plan. >> you talked about cutting expensive hammers and things in the budget . if you don't touch medicare, medicaid, social security, there are not enough hammers to cut. >> the big part of my part is to

take the government agencies totally out of control and to cut costs, coupled with a very large tax decrease, and by the way it's not for the rich, although the rich will benefit, especially if the economy takes off. they might be better off. including me. >> huge benefits to the rich in your plan. >> benefit, we're getting rid of carried interest, certain things that make it too easy for people. >> cutting top rate only 40%. >> if my plan takes off, great. even though getting rid of carried interest which is unfair. >> it's tiny. carried interest is tiny. >> it's psychologically very important. what happens is this. my plan is best for the middle income, for the middle class which has been decimated in this country. they built this country. they have been lost with our politicians for the last 25 years. and i think my biggest impact is to the middle income people. i think we're going to -- we're going to give them great incentive. i think going to be a great plan. >> we also had a little bit of fun in the interview, especially when we talked about one of the

things that bugs him about george costanza and some of the people he meets on the campaign trail. >> imagining that you skip the dip advertisers because like "seinfeld" you've got a double dip issue. >> i was out recently and someone was dipping the shrimp into sauce. 300 pounds. shrimp and dipped it in the sauce and then dipped it a second time. i never even met the guy. i said you just double dipped. it was incredible. he didn't know what i meant. then he understood it. he was a nice guy. i didn't have any shrimp. >> straight out of "seinfeld." >> right into it. he did it a double. it's pretty disgusting, right? >> right. i mean, you've got an issue with germs and the whole handshake thing, right? >> certainly i was -- i think i've been proven right. you do catch a cold. you have a cold and you come over and shake my hand, who knows what's going to happen. i had a friend recently came up to my office and hadn't seen him in a long time.

he hugged me, shook my hand. i said, how are you doing? he said, donald, i'm so sick. i have a horrible floour. why are you doing this? you know what i'm on the campaign trail and shaking thousands and thousands of hands. and i'm still here. so -- >> he is still here. he's still leading in the polls. both nationally and in iowa and new hampshire. and is going to be tested once again, kelly, when he gets on that debate stage on october 28th. cbs debate, boulder, colorado. >> that's right. i'm looking to the panel here wondering if they think a candidate can make it much further without shaking a bunch of hands. guys? >> i got to say. my favorite donald trump an dote is that powell vaul volcker is chair he admires most. >> steph? >> yeah, maybe he can get some cleansing spray for his hands so he can shake more people's hands? i don't know. >> john, i guess in the art of the comeback he said shaking hands he thinks is one of the curses of american society. >> when you think about it, kelly, one of the other

candidates in the predebate photo session or when they get together at the beginning, could really psyche him out by putting something on their hands when they shake. you know? could really throw him off his game. >> already trying to set up this debate for fireworks. i see it happening. thank you so much. >> we're going to have a great time. >> i'm thinking. thank you, john. john harwood, appreciate it. your money, your vote, october 12828th on cbs. we're getting more on the shares. >> we got headlines here on micron guidance. let me give you the headlines. of 20 to 26 cents for q1 versus estimate of 37 cents on the street. i'll quickly clarify that. on the call company's executives said seem to imply that those numbers were inaccurate and they were updating them. and that makes sense because obviously that would be a miss and you would expect to see the stock fall hard on that. it's not. it is shooting higher in the of

hours. some confusion here. i'm going to hop back on the call. bring you more updates as we get them. back to you. >> sure, up nearly 8% now, josh. explaining to do. thank you, josh lipton. insurance is getting innovative. we're going to talk to the ceo of insurance giant adventure capital next. you're watching cbs. when a wildfire raged through elkhorn ranch, the sudden loss of pasture became a serious problem for a family business. faced with horses that needed feeding and a texas drought that sent hay prices soaring, the owners had to act fast. thankfully, mary miller banks with chase for business. and with greater financial clarity and a relationship built for the unexpected, she could control her cash flow, and keep the ranch running. chase for business. so you can own it.

tech disruption is on the horizon for the insurance industry. peer-to-peer insurance starting to creep into the sector where they support each other financially. if it sees no claims, its premiums are reduced making the insurance cheaper. the xl group created a venture capital initiative to focus on developing new insurance products. joining us for today's vision of "the spark" is ceo mike mcgannick. what are earlier examples of the innovation you're pushing in the industry. >> one of the most important is products for the new energy space. there is a drive to get away from fossil fuels. we are able to develop products

that allow them to be sold more cheaply to obtain lower costs of financing. we expect that to go to 100 million premiums. fuelcells so far but looking at-bat ris. we are open to solar. solar has been tricky. >> on the battery front, the kinds of things we would find in a tesla is where we need insurance information? >> absolutely. if insurance products can be developed, we can lower the cost. >> do you feel your industry hasn't done a good enough job getting ahead? >> absolutely. we've been sliding if relevance for a while. if you look at 2001 to 2011, the portion of gdp attributable to pnc insurance dropped 3.4% to 2.8%. that's us losing relevance. we have to come up with products for the future. >> what is it going to take? you've done a great job being ahead of the curve. >> people are starting to wake up. big conversations all the time, are we the next to be ubered?

what could make that happen? you see more and more investment. we like to look backwards to figure out what happens next. the rate of disruption is so fast that it's very hard for our ordinary processes to catch up. >> let's take the example of driverless cars. one area people are wondering how does insurance adapt, does it ultimately become not me having an auto policy but a warranty on the vehicle? >> it could be or it could be a system risk, as well. all those things that have to interact to make a driverless car work. it can go from you to the vehicle to the system. any way along what it though, i think it depends on the politicians and not technology. technology could get there quickly. i suspect the politicians will slow it down. >> feels like the biggest ambition has been the internet, for consumers to hop on direct and eliminate maybe that agent person interaction.

what do you think is the next phase of evolution? >> four dimensions. first of all, think about as you said distribution. what are the changes of distribution? all these different things. i bet the agents and brokers harness that. second, look at what we insurance. currently we are really good insuring physical items. something that can break and we can replace. insuring ideas and code -- >> or cyber? >> that is a new line of insurance. we are are helping people with the restoration of identity. if you look at what we will insurance and how we will insurance or the way we underwrite. when the internet of things comes alive, we can monitor things to help prevent breakdown and be finer how we price and design and pull risk. >> how does regulation play into this whole new era? >> i don't mean to be cheeky, but generally not helpfully. the reality is regulators have a

profound concern if we make a promise into the future, that is upheld. if you think about the regulator, therefore, a huge barrier to entry, i think that remains for a while. that's a problem of p-to-p. >> we have to go. hurricane joaquin is bearing down the east coast. what's at stake for your industry with this storm? >> you absolutely never know. we watch hurricanes come up and go all the time. reality is we are prepared to go and help people as we always do. resilience is our business. you want a statistic that is disturbing, every time there's economic loss from a catastrophe, the percent insured is declining, not increasing. >> even after katrina. >> it's about coverage, the flood program. this is a real problem the government needs to address. >> we are looking at you to innovate. thank you for joining us. >> sure. amazon jumping into the gig

economy with full e force.

amazon flex is hoping to be the uber for high speed deliveries.

recruiting drivers to be on-demand couriers. a survey today found 92% of people are still more likely to use traditional delivery methods. they don't feel comfortable having someone else handle their products. >> the view from the boroughs, the last thing i want is someone who doesn't know what they are doing, ringing the door bell and wake up my baby. i like my ups guy. >> i like the brown uniform. >> isn't the timeliness going to trump all these factors? if you needed formula or something right away? >> you hop in the car and run down to giant. there is a limit to the benefit of some of these technologies. >> amazon, they are doing so many things right without these people you can get the product quicker any way. >> they want us to think how did we ever do this without amazon flex. "fast money" is coming up.

>> you know the solar sector has been under siege of late. we've got the ceo of solar city. he will respond to allegations put out by short sellers and the ability of customers to sell back some of their unused power. >> it's a big deal for consumers who want that income. over to you guys. >> thanks, kelly. "fast money" starts right now. i'm melissa lee. you made it. he wasn't there moments ago. the fourth quarter is here. that is your best bet for the end of the year. details later on. shares of twitter or sinking as investors await the ceo announcement. we'll hear from a large shareholder who says the company is, quote/unquote screwing it up. we start off with our top story. a goldman sachs note reigniting rumors of m&a action in tech space. saying