a way. >> it is a foreign country, new jersey, right? >> i don't have words. i'm actually speechless but thank you both. >> you're staying with cnbc. >> i'm heading back to cnbc sydney and asia and popping back here in the future as well. >> you're a good daughter and good for your family, we'll miss you. >> closing bell starts right now. welcome to the closing billion. this is the last hour of trading. >> i'm bill griffith, the dow was down 537 points at the lows of the session, we have come well off those lows and back above 16,000, that may be having some traders breathing a little sigh of relief. after yesterday's rally we were actually up for the week by about 33 points but of course with today's decline we have wiped those gains out. >> we have, as mentioned dow down 360 at the moment, a lot of

red across the screen. here's a look at the biggest losers, bottom right of your screen, that's where intel, who's results came after out the bell yesterday is getting hammered, down 8%. look at disney, goldman, microsoft, united technologies, caterpillar, chevron, all down 2% today. >> home depot, its the least of the hardest hit today. >> explains some of the other green you'll see across the s&p 500 like a joy global, much more to do with declines that already happened than positive news today necessarily. >> where does this begin? it begins with oil. both brent and wti crude well below $30 a barrel. we hit levels we haven't seen since 2013. $28 and change on both of those contracts at within time today. >> the lowest settle, settled below $30, the first time since 2003, 2004 we've seen that.

putting renewed pressured on the markets and we'll get perspective from mohammed al arian. bertha coombs at the nasdaq market site in time square and jackie deank list. some of the data doesn't look good. dom, let's start with you. >> like you said we were off the worst levels today but there are three interesting themes among the multitude of themes in the market today. we'll start where barclay's price makes prices, exxon-mobil and chevron, down by 2 or so%, in line with the market overall, not terrible. that's perhaps a little comfortable for something. the another scene is the

financials, they are a big one. citi and wells fargo, back up there again, that's also part of the story here as well. both reporting earnings and among the laggers in the trade as well, citi shares down 6.5%. imc post, post number 6, a couple more financial themes to talk about. pnc, on the regional bank side, only down three quarters of 1%, a relative winner and earnings story this morning. right next to it is black rock the biggest asset manager, those shares showing signs of life as well down by 4%. and we don't want to be all negative here to balance things out with a check over here at the post five, macy's shares up by 1% in today's trade. one of the at least better stories overall for what's happening in the market. again, guys, interesting moves here overall, financials and energy remain a focus. back over to you guys. >> dominic pacing the floor down

here. the nasdaq the worst performer and bertha coombs has more on what's driving that index lower? >> bioteches are off 3%. large caps 3% as well. it's all about tech. intel's disappointing guidance and has chips leading the way south today. new lows for chip makers, some of the apple suppliers and another supplier forecast slower growth for its next quarter. apple itself is flat for the week. if we can bring up the chart and take a look to see whether or not it will be higher. if it closes lower here this week, apple would be down for the fifth week in the last six. it's once again the biggest drag on nasdaq year to date. but in the last couple of weeks some of the names which provided most of the gains year end, amazon and microsoft, facebook, google have been contributors to

a broad based decline. we have 40% in bear territory at this. take a look at the wall. this is the only thing we have going green, electronic arts, only stock up, strong star wars game sales data and one of six stocks in the index that is not in correction and only stock that's up for the year so far is intuitive surgical after a pretty good week at jp morgan. back to you. >> the answer to a trivia question for this week, if you go to a cocktail party, electronic arts and macy's have in common on friday? they were both up. >> does macy's sell star wars, looking for common themes but they have both managed to outperform this dismal market. >> oil prices setting new benchmarks every day this week. now we're below $30. >> that's exactly right. a lot of conviction in the trade today. the bears were out in full force and we touched under 30 earlier this week. today we managed to close under

that level. $29.42 where wti finished the session. brent reaching an interday low of 28. that was a significant move in crude oil prices, it started with news about iran and speculations the sanctions will be lifted. looking at maybe half a million barrels a day when they are lifted to a supply situation already overflowing at this point. add the losses we saw in equities today in the united states, fears over china that continue as well. this has been a really difficult start to the year for crude oil in the last week alone we're down more than 10%. over the last month alone, down more than 20%. many of the folks i'm speaking to still think there's downside ahead even though they say you could have days where we may see a little bit of a rally. they thought today actually would be one of them, especially heading into a holiday weekend but as i said, the conviction was really strong to the down side. look to see more volatility

here. look to see these prices slide. there's no evidence in the marketplace, nothing fundamentally pointing to the fact that supply demand is balancing at this point. and you know, just kind of gurnlg when it comes to crude oil and it will have an impact on equity markets as well. >> exactly right. weak economic data not helping those conditions. let's get to steve who has more. a lot coming down the pike. what is it telling us about the fundamentals? >> i don't know can if you can peg it all on the fed or tron data but they did not help today. john williams saying today that according to dow jones that market volatility is unlikely to deter rate rises over the next three years and repeated that notion there could be three to five rate hikes this year and expect igss they could come in with a dofish solve to the market and said outlook for 2%

growth remains intact. >> in terms of the economic outlook for the united states, the situation does not have appeared to have changed much. some recent activity indicators have been on the soft side pointing to relatively weak fourth quarter for real gdp growth but needs to be weighed against the strength evident in the labor market. >> that would be fine except most of the other data coming in pretty soft and raising -- retail sales down iday month of. whole sale falling further. down 19 industry production, lower utility production because of the warmer weather but still weakness in the manufacturing sector manifest in that report. fed officials could be trying to remain above the fray of all of the market swings and stick to a more stable course for policy.

but jp morgan moving back, we'll have exclusive results on the same question from a broader panel of the cnbc flash fed survey coming up at 4:00 in that hour. >> looking forward to that, steve. >> we've had jobless recoveries and job slowdown. >> lack of one. whatever that is. despite the big market moves and uncertainty, this week some are still optimistic for the end of the year. listen. >> how much lower? >> another 10% from here which is pretty nasty. >> a lot of turbulence left but it isn't going to derail the economy. i think weakness will be a buying opportunity. >> chief economic adviser joins us now with his thoughts about what's going on. always good to see you. >> thank you, bill. >> for the last five or six years been that feeling despite the sell-offs volatility we get,

we should look at them once in a while as a buying opportunity and that has worked ouxt the difference this time, you don't have a federal reserve -- they are not cutting rates any more or holding them lower. is that a big difference for you this time? what do you think is going on here? >> i think you can boil down everything that's going on in the markets with three things. one is we're shifting volatility regimes. we've come from a period where central banks were very successful in suppressing volatility and now either they can't or they are not willing to. the minute the volatility goes up, that will mean lower risk appetites. second, we started from a situation because central banks were so soak successful asset values were up here and fundamentals down here. the minute you have doubts about the fundamentals, you'll impact asset prices. and let's not forget very little

counter cyclic cal liquidity. it turns out to be large. look for a lot of volatility this year but i agree that this is also going to create buying opportunities but you've got to be really, really careful. >> it's interesting to look at the strength of the job market and focus on that for a moment. it's completely different from what we've seen prior to past recessions whereas barclay's points out you see the rate of job growth slowing 15 months before the onset of that event. in this case we have it picking up to what we've seen in recent years. there's something very different going on here and there are a lot of people hanging their hats on that strength here no matter what happens with stock prices. >> i think it's right to look at the employment picture and it's been really impressive. we've created 6 million jobs in the last two years. that's an enormous amount for this late into the recovery. there's a couple of things that we must not forget. wages haven't gone up. wage growth tab aneemic and the

participation rate is at multidecade lows, there's also element of the labor market to suggest we haven't totally healed it. >> the momentum is still moving forward. we're not all the way there but it seems like that momentum is still moving forward and high can you have any real slowdown in the u.s. economy while job momentum is still growing? >> yeah, two things to conclude. first this is mainly financial issue, not an economic issue so far. there's a risk that bad finance can contaminate the economy but that's a risk not a reality. the second element is because we're still creating jobs, those who think that the fed will reverse course on rates, those who think we'll get qe5 quickly, it's not going to happen. the fed is looking at the employment picture and still encouraging so they are not going to reverse cost any time soon. >> what do you make of the response of the treasury market to the fed raising rates?

you would think there would be a steepening, but that has not happened. yields have come down along the long end. mike has been pointing out that the yield on the s&p is 2.4%, where we know the 10-year has been yielding 2.0 2%. that another signal that the markets see rough waters ahead? what's going on here? >> put it really well this morning, you would have expected yields to move more but don't forget the starting level already reflects the fact they were repressed by central banks and that the pricing in slower economic growth. i think what's interesting is gold has been moving and the big question mark is that gold returns to its role as a hedge in this environment. >> mohammed, plenty of people concerned about deflation and recession are in the context of the global economy. what precedent is there for that to happen without the u.s. necessarily tipping into one

itself? if this is something we haven't really been through in the last -- i don't know decade or two about the size of china and others as big as they are, what does that mean for the valuations of stocks? how does that impact the u.s. dollar? what does that mean and what does it look like and how does it all unfold? >> lots of questions there, kelly. it's really hard to drag the u.s. down unless you get a major global financial crisis. and i'm not a buyer that this is 2008. 2008 was about the settlement system, this is different. this is about overvalued markets. but this is not about the payments and settlement system. the contamination to the real economy takes longer and not as hard as it would have been otherwise. the dollar, remember, the dollar price isn't also interest rate expectations. and i think the market is right to question the fed as to whether we'll get four hikes this year. i think we get two, not four.

what you see happening, the interest rate market is repricing the probability of interest rate hikes and with that the dollar strengthens against the euro. >> one catalyst in all of this has been energy prices, oil, kelly and i have this friendly disagreement about its impact on the economy. one of us thinks that the decline is not that great for the economy in the ago agree grd other thinks it may be. should we be celebrating this decline in oil or worrying more about it? >> so a couple of things. first, in the old days it was easy, we were mainly consumers, we would celebrate lower prices, today we're both consumers and producers and big producer, it's harder to celebrate. it depends which side of the equation you're on. but bill, you've heard me say, there are three unhinged markets, being hit not only by general issues but very specific issue and they get totally

unhinged. technicals take over and energy and oil is one of them. this is going to be a very volatile time for oil. i think the oil market is attractive but it's going to take time to find its footing. you don't restore unhinged markets that quickly. >> just as a side note the fed's transcripts from 2010 were released today and it's interesting to read them, talking about hey, everybody, late 2010, there's a ton of oil related activity booming in my sector, he was a kansas city fed chair if i recall, and mohammed, again, it's like a reminder of five years ago we weren't talking about how much energy could have been helping the u.s. recovery and i wonder how much it may dampen activity. >> absolutely. it's going to be very state specific. if you are dominated by producers you're going to get hit really hard. look what happened in texas, right? if you're consumer dominated,

this is a windfall. >> always good to see you. thank you for your time. >> thanks for having me time. >> let's get to our closing bell exchange. today we have joining us jeff from raymond james and new york stock exchange trader steven gilfoil and rick san telly. we'll begin with you. any reaction to what you heard from mohammed el-erian or how we're looking 45 minutes into the close. >> i think he framed it pretty well. the only area i would debate them, the fed and everything going on is giving us these strong dollar signals. but i think when you're done the rabbit hole and have bad policy, you have unintended consequences, which is the euro is looking pretty good. the yen is looking pretty good. but not looking pretty good because their economies are looking pretty good and not looking good because abenomics

is going to end or normalization is going to end. they are looking good because the carry trade put on for legal nefarious reasons to get leverage. that is causing the dollar to be weak. there's another signal broken, that's about the only thing i would debate -- >> you think the dollar is broken? >> i think that the value of the dollar all things being equal should be higher than it is. the reason it isn't, is because the carry currency short covering is pushing the kbren against the dollar and euro against the dollar to levels that like our stock market prior to normalization of the fed, don't reflect fundamentals. >> sarge, 1900 was a big level for you. you told me before you came on the air, there's another one you're watching. >> we kind of reproached it and backed off. if we can get to and hold 1887,

the game changes technically. we can upgrade the day from a disaster to just a really lousy day and we have a large buy and balance and i guess there is a chance. but in this environment, where you can almost guarantee some kind of violent move on the bell, i'm not sure what you should do here. >> what would you recommend to folks? >> i'll say the same thing i said last friday, the mantra is never on a friday, meaning once these markets gets into a downward scheme, they rarely bottom on fridays. the participants go home and brood about losses and show up on monday and tuesday in sell mode. maybe we got a decent chance the next part of next week. >> there was the feeling going into today, we're going into a three-day weekend, closed on monday, there might be traders who did want to be in the market oefrl a three-day weekend. to kelly's question, are you

seeing opportunities yet or what are you going to do with this market here? on january 5th there's a good chance we're in a selling stam speed, last 15 to 25 sessions, before they exhaust themselves. today is session 12. >> session 12. >> wanted to ask you, bill referenced the options expiration and even this month when we saw futures take a leg lower, people were saying we're not sure you should panic because there is this big expiration happening. what do you see in terms of the flows and is that going to let up at all here? >> the volumes are going to ramp up into the bell but more important than the options, you have to watch the vix, now about 28. i'm not looking at the screen, it's about 28. >> it is. >> if it approaches something like 40 or 50 we're approaching a bottom. a cap it lags. >> 40 or 50. >> this is a correction.

>> does it have to be a capitulation. >> i guess there should be but even if there's not, we have a long way to go where everyone is panicking. no one is running around with a chicken without a head and calling customers you have to get out now. while everyone's 401(k) is shrinking this is a methodical process we're going through. it's no the old days of 1987. >> before we let you go, are you looking at ind indicators to show you where we are at this moment? >> i'll tell you what with the shanghai composite under the low of 2927, that makes me concerned and even though we could argue why that particular benchmark, i think it's easy. if it starts to distance itself much below the 2900 level, i just think that would be a good canary in the coal mine that it's not safe to put your toe in any equity water. >> thanks. appreciate your thoughts on another wild day capping off a

wild week on wall street. market is down 410 points at the lows of the session the industrial average was down 537 after a huge sell program hit the market first thing this morning, probably in part related to that options expiration that we've been seeing that we'll have on the open and close today. even though the u.s. markets are closed on monday, we will be bringing you all of the overseas action on monday. be sure to tune into marketses in turmoil this monday. >> let's quickly look at one bright spot in the market, chipotle rallying on renewed investmenter's comments. shares up 12% this week. we heard again they might be closing for sort of a refresh in the stores doing other measures, those shares up more than 40% on the session today. the financials are really dragging down the market. there was another pair of big

earningings reports and kayla has more details for us now. >> the financials are the worst performing sector this month and today isn't helping any. citigroup down 6.6%, wells fargo down 4 and change percent despite the fact that investors were hoping for upside after what should have been a positive fourth quarter earnings report. citigroup should have had a perfect equation, loans grew slightly and bad bad shrunk and expenses fell 24%, should have been perfect for the bank but a bank has tons of market exposure and exposure to the energy sector. let's talk overseas first. we spoke to the ceo this morning took a line by line approach for citigro citigroup. china's slowdown was slowing but it's not contagious, india is a bright spot and he wished the u.s. were growing more quickly

and more robustly than it is, but he will take what he can get that it is relatively strong. banks set aside 300 million in reserves and the bank had $58 billion in total exposure to oil and gas. $14 billion in exposure to metals and mining and third of that he said, was already funded but just a third of that and majority of all of that debt was investment grade. that's an important point but for wells fargo, it had a similar fascination, there were questions about the housing sector, which of course wells is very much leveraged to and the bank's mortgage, they said interest income would go up and margins should follow but the lion ace share of the questions were about energy and the bank specific exposure. said its protecting its portfolio in case oil prices stay low for what they said was a very,vy long time.

wells saw over $100 million in losses in its oil and gas portfolio. in an abundance of caution, marking $800 million worth of loans as late even thoughener not necessarily late. this is current but this is the conservatis conservatism, the worry it might take longer for losses to emerge. there could be more around the bend. stocks not doing well today. back to you. >> kayla, thanks very much. let's break down the numbers in a first on cnbc interview johns sh ruesbury joining us once again. >> nice to be here. >> we're glad you're here. let me start high altitude before we dig into the numbers too deeply. the price of oil going lower has hurt producers and other industries that are affected by that, the transports and banks and so forth. but on the other side we were told that the consumer was holding us up. now we get retail sales that

hold us that retail sales were lower and christmas shopping season was actually not up to expectations. in your view, big picture, what is going on in the economy right now? when we look at the fourth quarter, to back up, fourth quarter was very strong for wells fargo, representing what's going on with our customers and consumers and businesses. we had great enkds for the year, 5.7 billion in the fourth quarter on loans and deposits. our payment data, we're the largest one or two debit card issuer in the country and have a meaningful credit card basis. we saw payment up 8% in the fourth quarter. so actually pretty excited about that. >> are you seeing that -- >> well, it's too soon in this quarter to tell. i don't think people are reacting that quickly. you can certainly see it in

autos. we had the biggest year in some time at 17.5 million units, that's a big business for us and see it in housing. housing is doing much better today than a year ago. the fundamentals on the consumer side and business side other than those in the energy business, which is about 2% of our loan portfolio, still seem very stable. >> we'll see what the market turbulence means as the first quarter unfolds but finishing the year, it seems very consistent with a two or 2.45% gdp growth environment. >> what are you doing in terms of valuing loans and at what point do you expect to have to kind of go back to these energy companies and related services that you might be money on loan to and say, we need more collateral, for example or we more -- we need to change the rate? what kind of steps are you taking? what additional steps do you anticipate if the price of oil

stays where it is? >> sure, we're taking steps you would anticipate for the portion of our portfolio, whole thing is about 2% of our total loan portfolio. the portion that relates to people that are actually upstream that pulled resource out of the ground, that's about 1% of our portfolio. for those folks we do a borrowing base redetermination a couple of times a year. we've been taking expectation or value of those reserves down and work with each one of them individually to figure out how the bark group will get paid back. every story is a little different betweening on the base and how they extract and leverage, but there's a lot of tough talks going on with people to help the banks get paid back. we began to see some losses in the fourth quarter and set aside meaningful portion of our overall allowance for those types of loans, but it's a cyclical business. we have hundreds of people that

are going customer by customer and of course the customers have been in the business and seen this movie before as well. it's pretty orderly at this stage. >> but at $30, rrnaren't we hitg that pain point. don't the talks become even tougher then? >> they are tough, don't get me wrong. there are some customers who can extract oil at $30 and still generate positive cash flow and there are some that can't extract at $50 and generate positive cash flow. depending on their circumstances it's different. for services companies, i would say that's probably particularly hard because if the rig count and new drilling activity has dropped off as much as it has, it's a little bit more binary for them in terms of what the future holds, that's a smaller portion of portfolio, a different business than those who have resource in the ground. there's a lot of activity going on there. >> for sure. place everyone is watching so

closely. thanks for joining us this afternoon. >> thank you very much. >> if you're just joining us, we have half hour left to go in the trading session. here's where things could get interesting, as we told people time and again. we see largest volumes on day and mentioned earlier there was a large sell program related to the options expiration and things happening. so now with the dow down 382, about 150 points off the session lows the question still remains what happens from here? >> especially when we consider we're going into a three-day weekend, whether or not traders want to be in this market with everything going on. we're going to talk in a little bit about china, a catalyst for this market coming up here in just a moment. >> let's get to dom taking a look at the biggest movers. >> one of the big movers today, we're at post 8 and this is where disney shares trade and disney shares down by 5.25%.

$95.92 the last trade there. not just because of the overall market but disney also got a downgrade one of the latest ones from analysts over at barclay's, equivalent of a sell. some of the reasons behind it again, espn, maybe no surprise there, they are concerned about some of these subscriber numbers here whether or not cord cutting, people getting rid of cable plans to look at ala cart offers and whether that outweighs success over "star wars." overall, the street is bullish on disney shares. disney has a current average price target as pulled by fact set of $147.17. disney shares under pressure with the overall market but also because of a downgrade at barclay's don't like subscriber

trends. >> thank you very much. there are so many movers today, it takes two people to itemize them, let's bring in sima in for more. >> a rough day. look at how some of the popular etfs are trading, oil prices tumble and the biotech sector in bear market territory. it took out its august low two days ago, some of the big names like amgen, celgene and regeneron down on the day. >> let's talk about these fears about china's troubles spreading throughout asia. that's been one of the factors. we bring in our world wadwide exchanges, will fred frost, getting close to bedtime. >> it's been a long day. >> where are we right now? as art has said, the markets aren't so concerned about

china's economy as they are about the currency. what's the stance now of regulators in china? >> the second week of the year we've learned that the they do have some control of the currency. we haven't seen four uncontrolled days in a row. that's a little bit of a positive to take. however if we look at the volumes also and volatility and this strange gapping between the onshore and offshore rate of the currency, that still occurred this week. the free market clearly hasn't found its natural rate. we don't know how much of the buying is being done so there's still uncertainty there. >> we remember back in the last week or so, a lot of people said to the chinese, rip off the bandaid and let the currency drop 10 or 15% and let people wrap their heads around how it may support the economy. and then they came out with rhetoric saying it's never going to happen. why not just go ahead and kind

of let it fall in one fell swoop? >> i think because it would cause great shock and unease, not just around the world but them as well. in terms of the currency itself, you've got to think about the corporate sector. so many companies borrowed in u.s. dollars or hong kong dollars, the equivalent the peg between those things. that means their interest payments are going up and that would just shift the burden onto the banks and we see them rise in that area. the other way we've seen them ease, the liquidity taps in china have been on in some form or another over the last 18 months. and of course interest rate cuts is one of those things. we also had lending figures earlier today, very disappointing as they have been for most of the last year. it highlights even though monetary policy is loose, it's not really feeding through to down the line. >> anything we should watch for in china as we head to the three-day weekend? as we mention the probably a lot don't want to be in the market for that long period of time

depending what may come from asia. >> last weekend might we see a rate cut,y think necessarily we would immediately. but what we did expect to see and didn't get, do we get clarity on what they are aiming to do, a target that we can work towards. maybe we'll get that, maybe we won't. gdp data is out on tuesday and that will be combed over with a fine tooth comb and crucial to sentiment. >> lots to have on your own plates, thanks for joining us, don't miss will fred and sara covering the global markets starting at 5:00 a.m. >> eastern time. >> if you're just joining us we're commercial free because this is an important day for the markets with 25 minutes left in the trading session, the dow believe it or not is off the lows of the day. if you're just joining us on the open, a huge sell program had us down 537 points at the low of the session. we've come well off that, down

384 but anything can happen in this next 25 minutes. walmart shares sliding after announcing plans to shut down nearly 300 stores here and overseas, courtney regan is at the walmart post with more on that story. >> i think the walmart shares are sliding more because of wider market action. the ceo said he would close stores that needed to be closed and walmart announced they will close 269 stores globally. 154 in the u.s., that represents 3% of the u.s. fleet and largest number of stores they have ever closed. they are closing all of the walmart express for mats, that was a format that began in 2011. just less than five years they are closing all 102 in addition to neighborhood and super centers and sam's club. walmart 115 stores in latin america, 60 in brazil.

bra zpil zil is a country they continued to struggle in and executive shake-ups in the country as well. we know walmart has really struggled to grow its sales and a lot of times more retailers what will do when they have a big fleet and sales are falling, this he will cut back. a lot of analysts are plotting the move thinking this is something they need to do in the long run to improvement profitable and same store sales but that could mean that wall mart may struggle to hit the sales growth targets it outlined in october of 3 to 4%. the company is committed to growth and going to add stores, several hundred in the u.s. and internationally in the coming year. they are going to be very careful about where they put those stores. >> we pretty much got the final report card on the holiday sales today and it doesn't look great, down for the month of december, retail sales were when that was not expected and then for the holiday period, a 3% gain when

they were projecting 3.7%. how did we do this year? >> that's exactly right. as we've seen for the entire 2015, the 2015 holiday season had winners and it had losers. we know that macy's came out and said it wasn't that strong of a season we hoped for but what we know from jc penny was pretty good l brands had a good season as well as lululemon. best buy we knew consumer electronics were in a deflation as ry stage and they had numbers that were negative. some players did well and some did better, some did worse. overall the holiday season sales a little bit less than we had hoped for at the very least. >> thanks, courtney. let's go back to sima for a look at stocks hitting 52 week lows today. >> we've got a ton of stocks hitting new 52-week lows. he want to point your attention to the s&p 500, now trading above the august low of 1,867.

a level that technical traders keep an eye on but there are a lot of stocks hitting new 52-week lows and it's a variety of different names. harley-davidson, whirlpool, auto nation and american express all down as much as 4%. there are over 100 stocks in the s&p 500 hitting fresh lows in today's session. for now, back to you. >> thank you so much. an eye on stocks, 452-week lows and we have more than 20 minutes left to go in the session. arthur cashen joins us here on the floor. what do you make of the fact we have come off the lows, or does this action still worry you? >> the primary reason we're off the lows is crude is off the lows, they've followed crude around slavishly all day. we're going into the expiration close as you had and i speak, it is tilted to the buy side and that can change.

viewers should be very careful, expiration dates are tricky and you could have what looks to be a billion dollars to buy disappear in a matter of minutes. >> if we hear big numbers like that, take it with that context. oil is tending to move up as soon as it settles lately keeping pressure off of stocks. that a temporary reprieve? what happens if come the next session renewed pressure and stocks go with it. >> i'm concerned we will see renewed pressure. we won't be able to turn this around until we get oil at least stabilized. we've got to get it at least stabilized. >> and that's not happening. relentless decline of another almost 5% in the wti contract today. does the concern come as we continue to see prices drop, home prices won't drop and they did and everybody exposed was in real trouble snl. >> the question was, if you get weakness again at the beginning of next week, you're looking at

$25 in crude. and that will raise all of the concerns about bankruptcies and high yield group. so bumpy ride is probably not over yet. >> speaking of targets, 1867 was the august low and people watching on the s&p 500. the fact they hit it but up now -- >> the fact you got above it gives you latitude. the number i mentioned on air much earlier, which was 1,856, if they bounce from there, they may be able to do something. but with the holiday on monday, and you have european and asian markets open, it's going to be very, very difficult. i would remain very careful in here. >> appreciate it. thank you very much. art cashen. >> let's talk about not the markets but the economy. many investors not just concerned about the sell-off but talk of potential earningings recession as we get into the

deeper into earnings season and whether or not that can lead to an economic recession itself. let's bring the chief u.s. economist with rbc financial markets. are we heading towards a recession? >> i think the likelihood of us having into a economic recession are strikingly low compared to a lot what's going on around here. i think what's happening today and last week is a sentiment driven reaction. i think if you really take a step back from the fundamentals, i think the fundamentals remain extremely sound. important part of discussion, what has been the catalyst for the market to respond the way it has, emerging markets and energy. if you look at sort of the tech boom or housing bubble, 18 months into those after we pass those peaks we're 18 months into the energy peak, we lost a ton of jobs over those cycles.

1.4 million during the housing bubble and 350,000 during the tech bubble and gained 3.4 million today. we're using energy as an idea for why we might be shifting into recession is a dubious concept to be sure. >> what happens though -- what happens, tom, if the rest of the globe -- if other countries, china and ton of emerging markets might go into recession, what happens to the u.s.? >> what we're seeing in the market over the last few days, think about 1998. that was the last time we saw a systemic em event. if it seems pretty reasonable and speaking with our emerging market strategist before i came over here, we're not going to go through even anything remotely close to that. he recognizes that there are significant issues there and indeed some of these countries could fall into recession. but ask yourself this, if we

don't go anything remotely close to there, what happened in 19d 88? we moved side ways. at best we moved side ways, so that's the right way of what could happen of an em issue spilling into the united states. >> bill dudley of the new york fed shrugged off the volatility and seemed to suggest that the fed is still on track with interest rates. should they be? >> look, i think what the fed is doing is the right thing and williams said something similar, we're not paying attention to day to day swings in the market. think that's the right move right now. but what i would say is this, it's true that the fed base beingally wants to brace the market if the fed wants to sell the idea of a rate hike to the market. they are running out of time to get four hikes in and thought they were going to go in march and june. march is a month and a half away. a lot of heavy lifting between now and then. we're four for now. we'll sort of see. i know people will be falling

all over themselves to look at the data. there's one key event in the middle of the next month, when yellen -- >> testimony to congress. that's going to be a significant event. depending what comes out of that, we'll decide what we're going to do. >> good to see you. back to sima keeping her busy this hour, how u.s. listed chinese stocks are faring. >> those china fears are front and center ahead of three economic reports coming out on monday night. gtp industrial ahead of that investor seem to be selling those names that have exposure, look at alibaba, weibo, down 3 to 6%. and interestingly enough, if you take a look at shares of alibaba in first two trading weeks of the year down about 15%. we'll have to keep an eye on these china exposed names.

>> for sure. thank you very much. oil getting hit hard again. we've been telling you, settling below 30 bucks. interestingly tgs not and has not been but continues to not get airline stocks a lift. dominic, what's happening? >> it's a pretty mixed picture. we wanted to come to the source. there's one post here where four of the big guys trade. you can see up here, united airlines, southwest, delta and alaska all trade right here at this post and you can see united really casing those declines down by 4%, southwest and delta, holding up well. there's one bright spot here, alaska airlines is up -- now it just faded but just about flat for the day so far. as we talk about airline stocks, certainly a huge focus because they are part of the transportation stocks that everybody is watching as a possible leader indicator for where the market overall is going. we focus on these airlines because of oil prices and are they going to be a beneficiary?

could the fundamentals show strength because of low oil prices? we're going to get a good check next week. a lot of these stocks report their earnings in of the coming week, including delta, united southwest, all reporting earnings. airlines a huge focus because of oil. certainly here at post five we'll see what happens next week when these guys report the financial results and of course any commentary about those low oil prices and where they see their business going. >> back over to you. >> many investors are seeking safety during market turmoil like this. our mike santelli is here to warning there could be hidden risks in that. right? >> first of all, there's such a thing as upside risk. if you get defensive and scared when the market has already been acting in a bearish way to have to be ready to surrender the potential upside from there. there are ways to maybe split the difference and say there's some investments that have gotten cheaper and base he canally been thrown out in this

indiscriminate selling. that will let you participate in improvement in the environment. corporate bonds, high yield bonds, especially those in closed in funds that trade at huge discounts, all of those things make sense as the kind of babies that have been thrown out. you have to consider the russell 2000 is down 23%. this is not the beginning of a bear move, but perhaps towards the end of a down leg. >> what's interesting, if they are trading at a discount that means you're getting a sale on what's inside of them. what does it tell you there are all of these funds trading at such discounts about psychology in the market. >> discounts are very wide. it tells you thiz are retail products and public investors, average retail investors who say we don't want to hold this risk anymore and a lot bracing for higher interest rates, some have

leverage on top of them. the high rates have in common, high yield bonds have sold off in the credit scare but it tells you we've already done a lot of selling here. it doesn't mean it's over or it's through. but it means you're not necessarily selling or getting defensive at a very clever moment. let's put it that way. >> i'll replay a conversation you and i had earlier today. the yield as you pointed out on the s&p 500 at 2.4% right now. very high. he is sfesespecially when you ce 10-year. >> hugging 20%. the dividend yield 2.4%. >> what does that say? >> that people are huddled for safety and treasuries and that they don't want to take on equity risk, even if you're getting paid for it. there's no magic trigger there that says that means stocks bottom. it tells you about historical relationships, people are shuning equity risk to a relatively extreme degree by recent standards, happened in

the financial crisis in 2011. you could say look, treasuries are overloved. there's two ways this can cut and they can grow further out of whack, i'm not saying it's over, but it does tell you we've already gotten skewed relationship inside the market. >> if there's not necessarily value in going to the safer places, where might there be value today? >> you hear a lot of people saying that quality stocks have been cheapened, maybe unduly along with a lot of stuff that has a lot of fundamental risk to it. there's a quality fetf. a couple of strong recognizable companies, if you look at the chart of that, it's gone down straight lately too. not as if the real stable stuff held autopsy up as you might expect. we're down just about 10% sin

december 29th. >> it's stunning, today's markets action at the lows around noon but it is a stining beginning to the year. we're not just talking about china but that sent investmenters out of stocks and the s&p subpoena still down about 2 or so% on day. the dow, the map at 15,993, looks like we could close below 16,000. currently down 391 points or 2.4%. some of the big o losers, really a mix of tech and energy. intel, earnings came out last night and guidance was a concern

for investors and that seems to sends shares lower. the philadelphia semiconductor index which houses the chip names also moving lower. that index down about 5% due in part to the weak earnings report from intel. other losers in the energy space, console energy among others responding to the weakness we are seeing in the commodity complex with oil trading below $30 at one point in today's trade. the sector heat map, utilities, it was the one bright spot in today's trade and down the least but at this point tracking to close lower on the day. telecom down and health care which has been a bright spot in 2015, but lower today by 1.3%. a lot of big biotech names like biogen trading lower. the worst performing sector is technology down about 3%.

>> dom is over here, $2 billion to buy into the close but what does that tell you? >> in case somebody missed it because of the expiration program we're seeing you could see a billion in buy interest in the close evaporate in an instant. keep all of that in mind when you hear the big numbers. >> we have our friend david darcy and matt from financial. let me start with you, you're following this market minute by minute, it's an options expiration. what do you expects to happen in the next five to ten minutes. >> a billion won't get you what it did a little while ago. we're not going to get a rally. >> 2 billion. >> so we're not going to get a rally until the end of the day. we're not seeing anything. the other day we saw incredible short interest. that's still at work here and there's no recovering that yext they are not going to cover on expiration friday, not in the long weekend here, too much out there. >> any more optimistic on the markets? >> at these prices i think

you'll want to start forcing yourself to nibble a little bit and we'll look back and quote that latin phrase -- perhaps one day we'll look back and remember even this with pleasure and this is a very good-bying opportunity. keep calm and carry on. carry on means don't carry too much sale that would break the mast of the clipper ship. keep calm and carry on. start to nibble at the phenomenal cheap stocks. >> you're not alone in that thinking right now by the way. plenty of high profile big style money managers who made that very comment earlier today on cnbc. >> we saw them parade out this morning and they were out there. that doesn't mean these levels will hold. 16,000 in the dow, we saw 1865 in the s&p 500 important numbers. we've blown through them.

if we do it again, a real blowoff effect we're not getting yet. it's been for other reasons, as long term, you want to start getting in there and being active. there are stocks down 20 and 30%, those you want to look at, not down 10%. >> steven told us earlier for this to be a flush out he want to see the vix at 40 or 50 but it's still in the 20s. do you think we're setting up for that kind of market event before all is said and done? >> if anybody happens over the weekend and companies are in trouble, those are things you could look for for the panic type move and people might say, that's done now we can get involved again. the vix was there in august and got there quickly and we were able to fight through that. if we get there again, then you put the money to work. >> a lot of damage is done in oil already. okay? a lot of damage has been done in small and mid cap stocks already. i think you can start to buy in those two sectors. >> even though oil has fallen 4

or 5% today? >> kelly, with respect to what matt said there's a a 5% in one day is this ka thar sis from the greek word to purify, cleansing going on right no. >> all of this will be on test. >> more latin. >> trying to make sense of what happened this week and get ready for a long weekend. let me as we bring dom in towards the close, let's review what happened to the markets this week. the dow today down another 2.34% for the week though, we're down 2.19%. we are up 33 points on dow going into today and we wipe that out and more. oil again the catalyst as we all know, as art cashen keeps pointing out, oil down 10 plus

percent, like amount last week as well. let's do year to date charts and see how we've done over the last couple of weeks. four the two-week period here, year to date, down roughly 8 to 10%, depending on major average in 2016 for the stock market and for wti and brent crude the declines are even greater down more than 20% on brent with the price of wti down 19%. we're already in correction territory. bear market territory for these here, dom. >> what's interesting too, i want to hit on something david just spoke about, we've been talking about the idea small caps have been lagging. if you look at the six-month chart of small caps versus s&p 500, they were tracking closely about 12 months ago. about six months they started to gap apart and that was a tell tale sign for some people that maybe we were due to weakness. has it reached a level where people want to buy?

maybe, maybe not. that along with transportation stocks is going to be a big deal and next week, we get a slew of earnings reports -- >> here they come. >> and that's going to be a big catalyst. for those people looking to want to buy, there is a catalyst perhaps next week if you get some microeconomic corporate fundamentals that can justify some of those moves and that could be a big deal. >> and you know the world central bankers are talking about the way the markets are acting chaotically right now and got to believe there's got to be in preparation, should they get further chaos ensuing that they would come in with calming actions and calming words. that's what's happened this past week with james bull ard, might wait on raising interest rates and i think china is the key, bill. china and crude and corporate profits. dominic, you just mentioned the slew of earnings releases, god forbid one of the hercules stocks that held the market up last year stumbles.

if that does not happen the market can take it calm and we've got to see good numbers out of the remaining reporters the rest of this earnings season. >> what's curious, i want to get mat's take on this. one of those stocks is netflix, momentum stock, huge ganler last year and reports early next week. do you think we can have that momentum carry if we do see a good report out of them or is the downdraft way too large? >> i don't think it's that large at all. people are waiting to buy and they'll buy on strength. they don't want to buy on weakness. when you're buying and it keeps going lower and lower, you have to puke them out. i would rather buy in strength. netflix could be the catalyst, technology, we're going to start buying these big stocks again. and i think equities are the place to put your money right now. >> if they don't go up until oil does, right? >> oil could bottom. we got a call from a major bank thatcy the end is in sight. that's good news.

>> the banks have been saying that for past few weeks. >> thank you very much. thank you. we'll see you a little bit later. wrapping up a crazy day in the markets, perhaps fittingly the american red cross is ringing the closing bell here at the new york stock exchange. stay tuned for the second hour, a critical hour to stay tuned for of the closing bell with kelley evans and company. >> thank you, welcome to "closing bell", declining 400 points today, bell just rang. the s&p 500 down 41 points. the nasdaq down 126. look at that nasdaq, down almost 3%, remember at the lows of the session today the dow was down more than 500 points. joining pant, mike santoli and evan newmark and fast money and

art cashen just off the floor. mike, your thoughts on this relentless selling activity? >> people said it was a market to sell rallies, we sold yesterday's rally. it seems as if people are focused on a lot of these technical levels and basically the idea we don't test the level three times. we got below 1900 on the s&p 500, all of this stuff is true. i would like to point out a lot of selling energy seems to have been used up by now. it doesn't mean we're done going down or any kind of forever bottom, middle of the day, the vix clicked above 30 and volatility index, everybody was saying why hasn't it gotten to 30. as soon as it did that was the low of the day before 1:00 p.m. and you had some programs to buy it. i think if you have a quiet weekend it's going to take something very unexpected and unnerving in the capital markets i think to have a good reason for this to go much lower in a hurry. >> do you agree? >> absolutely.

this has been far too measured a step. i would say while selling is patient and organize, it is pretty heavy. five minutes before the bell there was over $2 billion to buy on balance on the close. then the market shrugged it off, barely moved the market at all. >> you know, i think i'm going to -- i tend to like the market when it goes down, i'm a buyer on weakness opposed to a buyer on strength. and i think it's healthy. i think it could easily go down more. i think what you are beginning to see are a lot of those high growth names, amazons and facebooks, those are really down very heavily. i don't know how much i would read into it but a stock like exxon was only down 2%. i'd note that the xle today, actually closed -- energy closed hifr

higher than bens. >> do you interpret that as a positive sign snz. >> relentless selling in commodity and energy for years now and maybe begin to see a turn. i think a lot of high growth names are still voefr overvalued. >> it wasn't just a bad session but bad week for markets and another miserable week for the year. let's get straight over to dominic for more on week that was. >> let's wrap things up as we talk about the losing streaks for storks, the worst start to a year on record. again, it just goes to show you how much real negativity there has been in the marketplace. but to key on certain things prior guests have said, we haven't seen that wash out. capitulation is being mentioned. energy and oil prices continue to remain weak and now the problem is, we can add financials in the mix as well. important not home because of the broader implication of what

it says about the economy but also because it's the second biggest sector in the s&p 500, a slew of names, wells fargo, cities and black rock and pcn on the regional bank side and that continues into next week as well. that same financial theme early on in the week with the likes of goldman sachs and bank of america. also remember, it's not just them but a lot of transportation companies report earnings and economic data. you have consumer price index and cpi inflation daltd at a and housing starts, existing home sales and a pmi, purchasing manager numbers come out as well. there's a number of catalysts in the holiday shortened week that could provide stability or add fuel to the fire that's burning the market down since the year began. bank stocks a big focus as well as energy. now at least as the numbers settle, financials, the second worst performing sector year to

day overtaking energy. >> as mentioned concerns about tech do persist. the biggest loser of the week of all of the index was the nasdaq composite, bertha comes is up there with more. >> over 3.5% for the week, over 10% year to date. a correction in the last two weeks in the nasdaq and today led very much by chip stocks. intel's disappointing outlook weighing on all of the major indexes today and sending chips down 4.5% down for the day. chip sector down 13.5% for the year. and a lot of that led by some of the names like nxp sky works which are apple contractors, components, today hitting new lows, but the interesting thing, even as the s&p 500 overall dipped below the august low, chips have not done that and nasdaq composite hasn't done that and neither has apple.

managing to secure just a fractional gain for the week. so we're going to watch apple and see if they can hold on and try to stabilize. even as it continues to be a source of concern in terms of its sales and influence on the chip sector. biotechs to be the worst for the week, two weeks down about 16% or so. they did crash below their august lows this week and right now don't seem to be finding any sense of stability. finally i want to leave you with a little silver lining, today game on, the gamers and also you saw the casinos today, a couple of them doing better. wynn, revenues from vegas are doing better, not going to offset the issues but they may be getting hope that china does something over the weekend. then you had electronic arts with those strong star wars numbers coming out of npd for

"star wars" gaming and has bro, also up today, perhaps a little bit of that "star wars"" effect as well. hard to find the green though today. >> appreciate it. let's go down to you for your thoughts on this market. where you see opportunity or how nervous are you? >> first of all, i've been doing this about ten years, never been on the same panel with art cashin. for me personally it's an honor to be on with him because he's always measured. he tells it like it is and his tone is always the same, whether it's an update or down day. today being the latter. everything that we've been trying to say for the last nine months to a year are starting to come to fruition, doesn't make me happy and this is not some vindication speech but what i'll say is bond market has been absolutely trying to tell us all something for whatever reason we choose not to listen to it. if you're asking if this is over, mike santoli mentioned,

1864 and bounced, absolutely true. thags a good thing. i think the low in the s&p will coincide with 10-year yields trading down to 1.25% and 1.5%. the move in energy despite what everybody wants to say, 24/7 is not a good thing. yes it's great when we all go to the gas station but it's extraordinarily destabilizing and it's driving it down, not drive teenaging it higher. the saudis have a vested interest for it to go down. and that's exactly what's going on in my eyes. >> arthur, guy said he sees a 10-year yield going down 1.25%. you mentioned you didn't think it was a good idea for the federal reserve to raise rates in december. >> doesn't look like it now. >> is that what you think? >> i still believe that we may see zero again before we see 1%. now, it's going to be very

difficult for them to retract what they did and they are going to lose some credibility but i think they are going to find its inevitable. their data dependent and it's deteriorating at the rapid pace. i'm not sure we're going to get anywhere. i think the last payroll number was as phony as could be and i think the next two payroll numbers aren't going to be anywhere near that. >> hang on one second, everybody, joining me right now with his take on the sell-off of the host of mad money, jim cramer. i was listening waiting for the market open to see how bad it migtd get. what is the fact we closed better than those levels but not much say to you? >> it's a bad market and art cashin is exactly right. we'll say the fed made the wrong move. i know that's a very very difficult for the fed to ever admit. lots of people came on air and said the fed has to take action, based on nothing, all of the data was getting weaker at the

time and had james bull ard come out with a rigorous analysis how oil was down so low you didn't need to do anything aggressive. they started it and this is all about recession, very much of a repeat of what could happened in 1937 where we thought we were so far out of the woods of the great depression that it was time to tighten and they are doing it again and they are not data dependent anymore, they have to get back on it. mr. dudley was surprising, i've known him i don't know how many years, very surprised and his statements i think were very out of sync with what's going on in the economy. art has seen it all and what we're seeing is quite frankly the -- it's very disappointing. >> it is pretty alarming. this morning trying to find bright spots and reasons for optimism. but this sounds to me like, what do are you calling it?

not a recession? >> if they do lock step, it's clearly a recession. mike ward from csx called freight a recession. i've got to tell you, looking at what's happened, we're oversold, back to where we were in 2011 where we got a good bounce. when i saw dudley's comments took away with bull 5rd's comments were and china market go back down, china freight is enkredably bad. tlds way too much oil. we're about to have major bankruptcies in energy. i can't be positive. we can have a oversold balance but the fed has to repudiate itself. janet yellen comes out on tuesday, we did this thing and now we have to wait and see, so far it looks really bad then we can have a rally of tremendous proportions but that was not the words we got from dudley today. he really really disappointed me because you undid what bull ard

said. i'm putting this at the feet of fed. it's a little embarrassing they got it so wrong. a lot of people come on air and the fed had to do this. the inflation rate is dropping so quickly it's miraculous they took the actions they did, miraculously wrong. >> i'll save that as a tease for your show coming up. >> verizon next week on thursday, let's look how that acts, you'll want to hold a ton of ver size zon. >> not a bad yield either. jim cramer, much more on how to survive the sell-off tonight on "mad money." be sure to tune in for that at 6:00 eastern. turning back to the panel -- >> this is -- guy, art and jim cramer have just given you the cla classic wall street response, which is the only thing that matters is fed policy, forget the real economy, forget prices

coming through the economy. 25 basis point change -- >> kelly, kelly -- >> guy, come on in. >> come on, evan. >> that's a classic wall street view. >> respectfully no, you've got to start being glib. it's got nothing to do with the fed raising by a quarter point the fact that the economy has been in the dog house, been in the gutter for the last nine months, the fed raised rates not because the economy is better because it reads metrics and unemployment rate they set forth and painted themselves in a corner. nothing to do with the fed. the fed has lost control. what it has to do with is this market is now facing a real economy in the united states that is suffering along with overseas markets that have been suffering all along. central bank policy has been flawed and all coming home to roost now. i don't give the typical wall street response ever and i'm insulted you would say that.

>> jim's view, which he expressed, it's all -- he needs janet yellen to come back next week and say guess what, we got it wrong and everything will be okay, he's basically making the assumption the u.s. km economy is well on its way to recession. all you sh you do is buy treasury bonds and not touch the stock market and sit it out until the 10-year yield hits 1%. >> i would think it's somewhat broader, not just about the economy, it's about world currencies and variety of other things. and that is putting some pressure. the chinese currency is pegged to the u.s. dollar. the fed raises rates a small amount, i say 100% of where they are. this puts chinese currency higher putting them in a bad spot. we're seeing a similar thing with saudi arabia. the currency stretches around

the globe are enormous. i know in december when they decided not to cut because of externals people said, wait a minute, you're the central bank of the united states, not the central bank of the world. that's when they painted themself into the box of forcing a cut in december when the data was rather lame. >> let's bring in rick santoli on a day with interest rates, the dollar it wasn't just stocks here trying to figure out what was going on. >> the previous guest just nailed it on every regard. listen, if there's going to be a recession and the fed takes everything back, there's still going to be a recession, except for when that recession is over, we're going to be coming from negative rates -- look at negative rates leak a dimer on your dining room lights. the more negative your rates go, the more dim the light is. and we're going to have to normalize at some point and the normalization and net movement

would then be bigger. there's just no way to escape the realities of the type of economy you have. now, if we want to be like a venezuela or argentina and prop up growth forever, what that will mean is you might have higher equity prices but you're going to pay the penalty in other ways. so i think it's pretty obvious to anybody that the fed did not tell us the truth about raising rates being data dependent. 2015 wasn't as good as 2014. they raised rates because this is the window and it's not going to affect whether you go in recession or you don't go into recession. that's going to happen either way. this goes back to the biggest lie of them all, that 1937 was caused by the fed raising rates. they could have lowered them. it isn't the issue. times weren't good then, times aren't good now. back then, the counter factual was completely ignored -- that

was the reason. world war 2 roermz was the reason and i hope we don't have another war to bail out the complex because we don't fight wars like that. >> the 10-year note yielding just above 2% and you pointed out the s&p 500 with the price declines we've seen has a much better yield than that. what does that mean? the capital markets are pricing everything for little or no growth. they are certainly not paying for earnings that happened yesterday or dividends that come next quarter. more than half of the company, the individual companies in the s&p 500 now have yields greater than a 10-year treasury. companies are probably overearning and treasuries are telling you that the markets don't expect much growth. to me, i think a way to square this discussion, what jim said if the fed goes in lock step with four interest rate increases this year then you've got to expect a recession, not that we're going to get one inhe have itably.

it's a capital market's corporate crisis right now, globally as well as currency as art said. nos something that right now is a main street consumer and househood crisis, it could get tlt. >> interesting to look at electronic arts, if it's calamity, even if they sold a lot of "star wars merchandise, shouldn't be rewarded so handsomely. maybe to carry the weight of the world? >> the decline in the price of oil, it's either one of two things, it's either oversupply and we're talking about a lot of oversupply or it is a slowing, dramatically slowing global economy that is taking the price down. and on the basis of the at least the numbers i've seen on supply and demand, it is supply related is not demand related. i'm not saying that everything is great globally and the global economy is going to be going at 4% a year. i'm not saying that, what i'm saying is the markets right now

for the stocks saying the recession is here. >> here's crude under $30 today. art cashin, what's the next level. how important is that? >> if you get selling at the beginning of next week, they'll bin to target 25. and the great concern evan is many of these frackers are in the jufrpg bond or high yield catego category, there are estimates that two-thirds of the junk bond community could declare bankruptcy. >> i think what's what saudi arabia wants, that the shake-up you will see will involve the bankruptcy of a lot of frackers and shale -- i do believe that will happen. but i think that's the ebd of the shakeout, not the beginning. >> and then what? >> michael's wild card, not to pick on anybody, but the king of saudi arabia is rather ill. and only the family is getting in to see him.

so heaven for bid, if something happens to him, you'll have a change in leadership and that will be geopolitical disrups and we'll see where we go from there. >> before we let everybody go. guy, we'll begin with you, oil, the deflation we're seeing from all sorts of different commodities, do you think the u.s. consumer can rarry the mantle here? >> i'll say this and hopefully people understand what i'm trying to say, we often confuse the health of the u.s. consumer with their spending or the fact they are spending a lot of money. don't confuse the u.s. consumer's want to spend with the health of the consumer. they are two extraordinarily different things. there have been a few polls recently suggesting exactly that the consumer is not nearly in as good shape as spending suggests. so are they going to be opportunities? look at macy's over the last couple of weeks. i don't know where it closed 2d, green most of the day in terms of that specifically, most of if not all of the bad news is in that name.

but again, at a certain point no stocks are i am perve yus to what we're facing right now. >> rick, last word, we prern you sticking around. guy had mentioned the next move for rates could be as low as 1.25%. what would you say? >> i don't think so. i think we're going to stay pretty close to 2% for quite a while. >> okay. rick, appreciate it. guy, art cashin, thanks so much. be sure to stick around and catch guy with the fast money crew at 45:5:00 in an exclusive interview. market woes as we mentioned can clearly be traced to oil. stocks have moved in lock step with the oil price which plunged another 6%. we'll talk to a top energy trader where it might be headed next. still to come, market high flyer netflix has come down to earth but with earnings out next week it could provide some hope for investors. we'll preview the streaming service's outlook just ahead. while u.s. markets are closed on

monday, we'll be covering the moves overseas for you and moves in dollar and oil and how tuesday's trading could shape up here. you can catch special coverage, markets in turmoil, 6:00 a.m. to noon monday. don't miss it. jug of coffee, and back out of the garage. right into your wife's car. with your wife watching. she forgives you... eventually. your insurance company, not so much. they say you only have their basic policy. don't basic policies cover basic accidents? of course, they say... as long as you pay extra for it. with a liberty mutual base policy, new car replacement comes standard. and for drivers with accident forgiveness, liberty mutual won't raise your rates due to your first accident. learn more by calling at liberty mutual, every policy is personal, with coverage and deductibles, customized just for you. which is why we don't offer any off-the-shelf policies. switch to liberty mutual and

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welcome back, cnbc conducting a flash survey, tough to say, flash survey of economists and market strategists on how today's sell-off could afbt the fed's time line. steve joins us with results. >> we did a new survey of 33 economists and they think the central bank will still hike rates this year and chance of recession is higher. in light of what's been going on, what's the fed's next move? 79% say it will still be to hike only about 15% saying with lower rates and very small number, 6% say new quan tate tif easing. date of that next hike, may is the month opposed to april and number of hikes in 2016, 2.1 versus 2.8 and funds rate about the same because two hikes gets you to 90 basis points. again the fed meeting fed

forecasts is for four hikes which is about 1.4%. i want to show you the recession probabilitity which ticked up quite a bit. we're now at almost 28%. and we have been here before and it is not resulted in a recession but risen steadily from the low. this is a chance of a recession 12 months from now rising to about 28%. normally there's a one in five chance in any given year. it's a little bit higher than that. don luskin writing in, hey, stan fisher, how's that ballpark working for you now? a reference to an interview with stan where he said four rate hikes was the ballpark. alan sign night writes in, relief depends on a lot better news from china and without some or out, all stocks may stay depressed and interest rates low. from time to time financial markets top straighting on any semblance on valuation thoughts

and start trading on fear and nervousness. a lot of economists say what's going on here, whatever is happening with the economic data it doesn't justify what's been happening with the market. >> if we can show the graphic where we compare the number of rate hikes, it was almost three last time. how much time has passed? >> about a month, 30 days. >> frankly that's a huge change, correct? >> they priced one quarter point hike out of the essentially out of the equation for this year. when you see they pushed it ahead to april, there was about -- i want to call it a 50% chance the fed could move in march. that's down to almost nothing. somebody said in one commentary, you can kiss march good-bye. that's gone. now we're into may for the median average forecast for when the fed will next hike rates. >> we appreciate it. >> pleasure. >> jp morgan one of the banks

today that moved its forecast for a rate hike from march to june. stocks falling in tandem with crude oil which fell 6%. it settled below 30 bucks, a 12-year low and joining us now with more on oil is anthony krusanti. i mean, wow. what a day. >> time running out of cliches, how low this can go. prices are scratching the belly of a snake right now. it's low. and i was listening to guests before and this started as a supply issue but now it is a demand issue definitely. when oil prices drop and gasoline prices in particular, when they drop, we usually see an increase in the demand for gasoline, 200, 300,000 barrels a day. that's not happening now. the demand for gasoline has remained steady 9 million barrels a day for last year and a half. not getting increase in demand out of china or out of europe or any of those countries or even the u.s. now that's economy number one,

technology number two, efficiency number three for that reason. >> let me bring in -- evan, you were saying if it's supply then we all shouldn't be so concerned. what would you say hearing that analysis? >> to me it as long as what is started this and what seems to be still going on is a strategic objective of saudi arabia to push out certain suppliers, as long as the key number one driving factor of this, then i'm not saying that his numbers are wrong or the demand is not involved, all i'm saying, the number one -- if tomorrow something happened to every saudi arabian driller, right, or every aramco and oil experts got shut down, i can assure you the price of oil would not be at $28. >> of course not. of course not. that's 10 million barrels a day. hey, evan, on monday they are going to lift sanctions against iran. i don't know if saudi arabia

figurered that one into their mix but that's another 500,000 barrels a day. you may think of them adds geniuses but laid out this plan but they are killing themselves. the thing about the frackers, they'll go bankrupt, and here's the thing about frackers, three weeks and $3 million to set up a well. once -- once the one fracker is out of business and not producing from that well anymore, somebody picks up assets and price rises to $45, he's going to jump in there, three weeks, $3 million and start producing more oil. >> also luskin. >> i don't see it going above 50 to $55 for years for now. the saudis basically engineered their own demise by this. and also the u.s. frackers have done the same thing. >> hopefully not the u.s. stock market. >> this oil prices are low for a

long time. >> anthony, that was clear enough. thanks for joining us. >> thank you. >> anthony grisanti. >> citigroup and wells fargo fell today on the backs of earnings, we'll discuss if more doom and gloom could be on the way. you're watching cnbc, first in business worldwide. what are you working on? let me show you. okay. our thinkorswim trading platform aggregates all the options data you need in one place and lets you visualize that information for any options series. okay, cool. hang on a second. you can even see the anticipated range of a stock expecting earnings. impressive... what's up, tim. td ameritrade. there's a lot of places you never want to see "$7.95." [ beep ] but you'll be glad to see it here. fidelity -- where smarter investors will always be.

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welcome back. the biggest banks were down

across s board. financials are often see as leading indicator of the market. is there a weakness a sign of more to come. joining us vice chairman of aerial investments, what do you think about what they pore tend? >> they do tend to in the short term, clearly the market focuses on the next couple of months in pricing morgan stanley or kkr. at this point, with these stocks being down not just this week but being down from their august highs by about 40%. these stocks are very cheap. historically the best vway to vl yau morgan stanley, price to tangible book. it was above tangible book in august and now times eight, very, very cheap. >> charles, i wonder if we can try to interpret what the market might be suggesting here or betting with these names. well, it's looking like that pretty much was a credit cycle

and that was your peak returns if you're goldman sachs and morgan stanley. the market is not very impressed. i'm not saying that is the truth but obviously the losses and credit reserves and things like that have probably been at their best level. so what would you say to those types of concerns? >> there are two things going to get a lot better. first the legal settlements which have been horrific, those are coming to an end. and the interest rate environment has not been peak it's been trough. somebody like morgan stanley hasn't been able to charge customers on their cash balances for six years. and a simple 2% short term rate would allow them to charge 25 basis points to all customers producing much higher net income. we don't think earnings have peaked, we think they are going to get a lot better from here. >> i have a question for you, do you need to have a point -- you need to have a point of view on the interest rate cycle and if you believe what some of the people earlier on the show were

saying, basically interest rates are not going higher that's may be why they are selling financials -- there's no net margin caring for them? >> that's exactly right. if you don't think interest rates go up from effectively zero, you shouldn't own these namtz. that's ridiculous long term. the long-term average for 10-year is over 4% and short term rates, north of 2%. we could stay down here for a little while but we won't be at these levels long term. >> that's what they said last year and year before and year before that. >> you've got to keep -- always reminding us of that point. >> because it's true. >> charlie, thank you. >> weak commodity prices have erased shareholder value in resource companies, we'll look what's ahead for miners and app apple tumbling 3%, we'll get more details on the story ahead

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(train wheels on tracks) it had no mouth, but it spoke to me. it said, "rocky mountaineer: all aboard amazing". here's a look how we finished the day on wall street. s&p 500 gave ip 41 and nasdaq down 126. the ripple effect of this

sell-off being felt on main street. eric is in times square where he joins us now with some reaction. eric? >> that's right, kelly, we talked to people in times square this afternoon. everybody we spoke with aware the markets have been done but in terms of reaction, they are all handling it differently. take a listen to this. >> i've been seeing a lot of negative words, plunges and red sea, seen the dow plunged. i don't know much about the stock market i know it's not doing too well. >> i have money in the market and family to take care of. i'm concerned of what happened in 2008. >> i think the economy is very bad of the united states. but the government is telling us that the economy is good. >> it does make you stop and think about purchases that you might have planned, really large purchases and when you look at your portfolios or 401(k) and seat changes, it's a little scary but the stock market is cyclecal. >> there are a lot of confusion

and different strategies, some people are selling and staying patient. i'm not going to come here unless i've crunched some numbers. here's the data. when the market has been down 8% in the first two weeks of the year we don't have a benchmark. we don't know how the rest of the year does, never happened before. but the first month of the year, one out of two times it ended the year positive and down 8% through the first quarter, three of those times it still ended the year positive. if those numbers are any indication, being patient might be the right strategy. back to you, kelly. >> did you give the folks the numbers? did that help them offer them any relief? >> i didn't give them the numbers. a lot of them were feeling the markets in general and looking at the updates and not really data driven people, more emotional people. it was good to balance it out. >> we appreciate that. thank you so much. mining giant got a pop today but the stock has been in free fall down 40% just this year. that's been two weeks.

kate kelly joins with more on the fallout. >> freeport is in a tough spot thanks to exposure to both crude oil trading at rock bottom levels and to copper as well. in fact it's the largest publicly traded copper producer in the world. it has become a liability as the red metal hits six-year lows this week. freeport is operating at a loss and had $340 million in cash and cash equivalents as of september 30th. that's when commodity prices in both markets i just mentioned were considerably higher. they've avoided a downgrade to junk status so far but bonds are trading at deep discounts and swap prices suggest the market broadly is factoring in chapter 11. one calls it for the poster child for the commodity meltdown of the our players are sharing the pain, the mining giant got

clobbered on the u.s. shale assets, a tale of two commodity families, energy and base metals both suffering. same story with glenncore based in switzerland, also facing a lot of junk status downgrade concerns falling 7% on the london market earlier today. it's not a pretty picture overall and yet some are saying we really might be need a commodities bottom, especially in oil, including goldman analyst jeff currie on earlier, say the fundamentals may change favorably this quarter. if that occurs, we'll start to bounce back. >> that's i guess the hope. but again, to the point we're making, nobody knows how to forecast or even price this thing. you could talk supply and demand but this is a commodity collapse nobody saw coming. >> commodity collapse nobody saw coming and commodities themselves don't go away, in the case of the metals, the stock piles are tremendous. i do think we're at the point now of this rec conning, where

you're trying to see if balance sheets can work at these prices that's what the markets in general are doing. >> i think it's not the commodity meltdown is not a secret at this stage. stock like bhp was $100 stook in 2011 and it's at $20 right now. you're talking about for value investors, this is exactly the time when you're supposed to be buying bhp. >> berkshire was loading up -- >> i'm not saying -- i think it's extremely hard to time these things, when you ask yourself about the relative carnage going on, we talked about it a bunch of time. would i rather own a share of facebook or exxon or share of twitter or bhp? those are the kind of tradeoffs investors have to make all the time and usually the time to sell bhp was in 2011, not 2016. >> fair enough. the sum may be greater than the

parts for apple's iphones but its parts and parts makers are partly to blame for investors bailing on stock. slowing user growth have sent netflix down this week. ♪ they may want the latest products and services, but they demand the best shopping experiences. they're your customers, and as you strive to meet their digital expectations, they're enjoying more choice and greater power than ever before. at cognizant, we're helping the world's top global retail companies face the demands of today's digital economy by blending physical with digital to create more responsive, more rewarding retail models... ones that transcend channels and locations, anticipate expectations, and create new ways to engage consumers at every imaginable touch-point. it's a new day in retail, where a company's ability to influence a purchase decision

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shed 22.5% today. josh has more breaking down the numbers. hi, josh. >> kelly, the news from the suppliers has been ominous. analog devices, the latest which cut the revenue forecast for first quarter, companies citing weaker than expected customer demand. analog devices generates 20% of its revenue from apple. then there's taiwan semiconductor, now forecasting first quarter revenue to decline as much as 11% from the previous year. apple components contribute about 20% of sales for the company says credit suisse and dialogue semiconductor which generates 75% from apple revising down for the fourth quarter. who is next? he is looking at three name that could suffer in the months ago,

jabil circuit and texas instruments and saying the warnings do suggest not only are apple's march numbers likely at risk but even december now could be vulnerable. this news of course really having a big debate on apple, will the company grow iphone units in the quarters ahead. skeptics point to the maturing smartphone market. and bulls look to all of the iphone fans still waiting to upgrade those record numbers of android switchers. investors will find out more when apple next reports results on january 26th. back to you. >> circled it in red. thank you, josh. the fangs, facebook, amazon, netflix and alphabet and google will report next week. netflix, out with its results, we'll see how the streaming company may fare and if that could help boost the sagging group. even though the u.s. markets are closed on monday, we'll now be bringing you the overseas market

action live, be sure to tune into tour special coverage "markets in turmoil" 6:00 a.m. eastern to noon this monday on cnbc. ere's a lot of places you never want to see "$7.95." [ beep ] but you'll be glad to see it here. fidelity -- where smarter investors will always be. if only the signs were as obvious when you trade. fidelity's active trader pro can help you find smarter entry and exit points and can help protect your potential profits. fidelity -- where smarter investors will always be.

welcome back. netflix, one of the so-called

fang stocks that led the market last year is down 9% this year. and it reports earnings next week. julia boorstin has more on what people will be looking for. julia? >> this year's declines are quite the reversal. netflix was the best performing stock in the s&p 500 last year, up 134%. when the company reports earnings on tuesday the focus is on subscriber numbers. the company forecast the net addition of 5.15 million. there are two other main themes to keep an eye on. one, netflix faster than expected global expansion announced last week at ces and netflix ramping up production of originals from licensed content from the movie studios to draw and keep subscribers. on tuesday they are looking for more context on content and track overseas and you could expect to see the stock move in one direction or the other. >> christine is here with us. what are you looking forward

with this result? >> you wish i could say it would turn around market sentiment. like you said, it came into the year with most promise. up 83% last year compared to the s&p which was down 1%. for netflix, expectations are muted. so they are looking 4 cents a chair versus wall street which is 3 cents and revenues are in line at $1.8 billion. it is everything that julia said we are looking for. we know to expect domestic subscribers to be weaker than previously expected, not to be keeping pace with the rest of the year. and they have announced a huge international expansion, 131 international markets. >> that will cost them increasing content acquisition and the pressure on margins. we'll see them mention that on guidance for 2016. i would like to bring up the competition, which we talk about with this name. the golden globes last week, they were up for eight

nominations. amazon is the only streaming service that came away with two actual awards. so i think they create great content but that is not unique to them. and that is their bread and butter. you have amazon with other offering like two-day shipping and cloud and they are still winning on the streaming end as well. >> mike? >> i wonder, last quarter or two quarters ago, when they disappointed new subscribers, they blamed it on credit cards, they were trying to come up with excuses. i wonder if that means there is a potential they get that figured out and if user growth is the thing we seize on here? >> i think that was more of an excuse. i think the feeling about that, especially after two prior quarters with just blowing subscriber numbers out of the water, and that is really where we see netflix trade after they report earnings. it is not necessarily on the earnings or on the revenues. it is what are the subscriber numbers. so they came out weaker than expected after a strong first half of the year and they came up with this excuse. it will be intering to see what they say this time around. but so far the guidance looks as

though q4 numbers will be a little bit weak. >> at least we're not expecting a blow-out. so there is hope there. christine, thank you. >> thank you very much. >> christine short here frommest imize. u.s. markets are closed on monday but many overseas markets are trading and it could be super volatile given what we've been through. we'll be live on monday morning. we'll look at impact on tuesday's morning, next. with creative new business incentives, the lowest taxes in decades, and university partnerships, attracting the talent and companies of tomorrow. like in utica, where a new kind of workforce is being trained. and in albany, the nanotechnology capital of the world. let us help grow your company's tomorrow, today at business.ny.gov

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welcome back. well, the u.s. markets will be closed monday or a holiday, overseas markets will be trading. let's bring in michelle caruso-cabre caruso-cabrera. what is happening with china and europe. that is why we're going to be here on monday. that will affect the tuesday open. we have to keep people informed of what is happening overseas. i looked back at the last time we had an asian-generated crisis. remember the crisis in 1997, 1998. the s&p fell 18% when the ripple effects went through to the u.s. market. so we're only 10% into this. if you think china is a huge problem and the markets may by telling us that is what is going

on, it could very well be we have a lot to go here. >> i think people prefer that comparison to the most recent crisis we've been through. if only better than 2007 and 2008. >> that is a great point. we are all forever going to be children of 2008 and 2009 just like my grandparents were children of the depression. that colored their view and we ask, is this systemic, is everything going to fail. it is never the same crisis twice. >> on that michelle, that does it for us on "closing bell." take it away. >> "fast money" starts right now. we are live from nasdaq overlooking times square. i'm michelle caruso-cabrera in for melissa lee. our traders, dan, steve, brian kelly and guy adami. hello, guy. >> hi. >> tonight on fast, the man who called the crash in august is back. he has an even more dire prediction. we'll hear from him in moments. and plus with this market turmoil are future rate hikes