>> thank you for sticking around for 120 minutes. >> what can you tell us about the next -- lane kifen? >> had dinner with him here in new york. great guy. >> "closing bell" starts right now. welcome to "closing bell." i'm kelly evans at the new york stock exchange. >> that was a very cryptic no comment from larry kudlow just now. it is one month since election day. we are this much closer to dow 20,000. stocks are higher again. i was just talking to a trader on the floor. we all agree stock prices will never go down again. >> that is not a sign of

euphoria. >> we continue to move higher. we have someone who says this rally is not overdone and there are many areas of the market that are still having room to run. that will be coming up later. >> if you are invested heavily in the bond market as so many have been, your portfolio could be down since the election. we have more on how exposed you should be to fixed income right now. >> and as the transports also hit new highs a new report says airline profits could decline next year. we have a debate on which airline stocks could be worth buying in the meantime. >> we are watching trump tower. the president-elect's cabinet is taking shape. we will talk about stories to lead the epa with harold ham to ring the closing bell, continental resources. we will speak to him. >> continental resources celebrating its 50th anniversary of its founding. let's start with the markets

push to new highs. we have bob pisani tracking the action here on the floor of the new york stock exchange and michael santoli covering gains in international markets. bob, let's start with you today. >> the bottom line is the rally is continuing although we are off of the highs here. let's review the three components of the rally besides the gradually improving economy. we have the trump rally with help for gdp expansion that we have been talking about. we have seasonal strength. and then we have sector rotation underway. what do i mean by sector rotation? take a look at some names that are moving today. besides banks that have been leadership real estate and technology has been moving, as well. we have seen other things like autilities moving up. they have been laggers today. that is the rotation that i'm talking about. one thing very interesting, industrials have been a market leader and showing unusual weakness today. too early to call a trend. defense stocks, they have been

big market leaders. all the big defense names are down rather notably here today. number two, other industrials in this space. i'm talking caterpillar, honeywell all to the down side. this is the first day we have seen this happen. that is the kind of thing you want to watch for when you start seeing trends starting to top out. not there yet but keep an eye on that. >> we'll check back in with you in just a bit. mike is here to look at how international markets have performed since the election. >> we have come to call it the trump rally and domestic-oriented u.s. stocks have done better but has been a global up turn in the last month. you look at developed markets and how they have done since election day. you have big markets in europe like france, germany, italy out performing the s&p 500 from that date. japan, of course, a big growing and a lot of hopes for global

reflation trade. inflation picking up and gloeth in general real economies. certainly supporting those stocks overseas. here is the issue for a u.s. investor if you wanted to capture that in a handy way it is often hard because those are gains in local currencies when you overlay the dollar gains it does not look so good. here are some popular etfs that play the markets straight such as all overseas markets and the bottom one there, emerging markets. very modest gains for a dollar-based investor. if you look at the currency hedged versions of those index etfs and they have had more participation in the upside. this is a little bit of fix that you might be in. do you hedge the currency? do you try to play them otherwise? it does show you it has been about strong dollar which gives cover and maybe raises growth exportuations. >> a lot of move we see in these international markets is all the

flip side of the dollar. the currency has taken the dollar out of it? >> it costs money to hedge. they try to strip away the effect of the currency translation. >> conventional wisdom says trails trendwise by what? six months? a year? are we seeing that now especially when mario dragi began tapering process? >> we suggest more than eight months. it seems like something like that might be going on. it seems like forever the story with europe investing has been stocks are really cheap but the growth is not really there. also, especially when it comes to europe about a quarter of the index in europe is banks. the bank stock rally is great for them but it is not necessarily something you want to bet as heavily on. >> stay right there.

krarl icahn just appeared. >> there is obviously very good news. it's morning now in wall street or not so much wall street but the country and it may be a little too exuberant. i think all the things donald is doing really point to a much, much better economy. >> let's talk about that among other things in our "closing bell" exchange. joining us michael yoshikami. we have steve grasso. and he jokingly said he wished he bought more now but is it overdone in your view? he seemed to suggest maybe it is a little bit here. >> i think there certainly is cause for optimism that there is

less regulation, lower taxation. there is counter veiling factors we have to be aware of. an interesting statistic it was said if you look at equity valuations of the stocks in the s&p 500 their median valuation 98th percentile. >> trailing price to earnings. >> exactly. maybe that kind of fits with what you said that stocks are never going to go down. >> i was kidding, by the way. >> you know what? you might be kidding. a lot of people feel that way. they feel like we are just at the beginning of some massive rally. the market has gone up. i think you have to be cautious here. you have to take profits particularly take profits given the strong rally we have had in cyclicals. you are seeing the bumping up. >> we have been talking about how lop sided the leadership has been. yesterday the transports were the big story. how would you describe the fundamentals of this move? >> a couple of things.

when carl said he wishes he got longer the market post the election results that's human nature and that is what you seeing. you are seeing that chase not that carl is doing it but a lot of participants are doing that chase in the overall market. what michael is talking to is valuation. i think it is a positioning rally versus valuation. you have to look at weightings. if you look at weightings as a percentage of s&p it means that technology stocks can come in further, financials can run higher, industrials can run higher. industrials can move side ways but energy stocks can move higher based on weightings, not valuations. that's a big difference. >> rick, we will spend time on this later this hour. we have been alluding to this that as well as the equity markets have done if you hold a bond fort worth you have chances are lost more money than equity traders have gained because of

the rise of the yields on the yield curve here. >> i don't think there is anyway around that. that is like saying if you breathe air and go under water and breathe you will have a problem drowning. of course, we know that rates have to go up. >> i know to state the obvious a lot. i don't mean it to be an insult. it's like a strong dollar. there are certain things in life that the physics of finance can't be changed. as the fed tightens and growth starts to look like something we can really do as we move from a fed placebo type environment to a real potential structural change growth environment rates and dollar are going to go up. anybody who has been awake should be aware of that. if they lost more money in stocks too bad but you are under shooting stocks. i think we could be getting ahead of ourselves. i think if i strictly look at this as what janet yellen meant

given placebo medicine she was wrong. there is a new normal. it was structural. donald trump is the answer to structural change. and both houses is answer to change. nobody knows if the stock market is ahead of itself or not. check it a step back and always recommended that on cnbc. there can be a lot more of the yardage in front of this receiver that has the ball running in the u.s. economy than any of us have estimated. >> rick, i completely agree with what you are saying. as a bond investor, the guy who watches the fixed income market don't you agree that for most investors while they don't want to be in ten year treasuries having shorter baupds to balance off the offset from the equity stock doesn't that make sense to

still in the portfolio strategy? >> makes perfect sense. i give you one dynamic that would make no sense. what if we get a curve inversion? i'm not sure about the yield curve or how the fed will progress i don't take anything for granted anymore and i'm very nervous about the yield curve. if the yield curve adverts and you shorten duration you will be out of luck. >> michael santoli, how would you tie a bow on this? >> there is a long way between here and there when we are at 2.4%. i think you can basically have a market run too far in the short term to really be justified by what you seeing and hearing now. you have to give it the benefit of the doubt. do we borrow from january's gains? maybe we did. in terms of rotation financial stocks have outperformed

technology stocks. i don't think people are behaving as if that is the case. >> on three year basis -- >> guys, we have to go at this point. thank you. kelly just wrote a piece on whether the trump rally could result in a hangover come january. you can check that out at cnbc.com/thespark. we have two corporate stories breaking. dominic chu stepping in. >> let's start with time inc. those shares are spiking this on the heels of a dow jones story citing sources saying time inc. has hired bankers including morgan stanley and bank of america to possibly field takeover or partnership interests in this magazine publisher. all on the heels that time inc.

had been approached by a private equity concern including him to possibly look at taking over time. those shares spiking on that bit of news there. we will keep an eye on what is going on with time and seeing if there is comment from any parties. we want to call your attention to coca-cola. shares aren't moving heavily but a big name to issue. howard buffet, warren buffett's son currently a board member at coca-cola. he will nod stand for reelection. he has chosen to retire from the board and focus more time on his foundation which focuses on advancing sustainable ad practices and conflict mitigation. he has been a member of the coca-cola ecosystem either with bottlers or with coca-cola itself. a couple of big names and companies to talk about.

>> looks like he has been on the board for about six years as part of the interesting move. >> warren buffett's son retiring. >> thank you. 45 minutes to go here. berkshire hath away one of the best. so for a lot of other names. the dow is up 76 points. the nasdaq up 17 and russell is up 18. everybody is currently in record closing territory. >> and the airline stocks could be in for turbulence after international air transport association sounded a profit warning for the industry for next year. two airline analysts weigh in on which names could still do well. that's coming up. oil executive and trump adviser harold hamm will speak about possibly being named energy secretary. you're watching cnbc, first in business worldwide.

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. as we watch the dow potentially closing at another high today let's have a look at

30 components. yesterday only those three names in the health care space were sitting it out. today with about 14 names in the green, 16 in the red, the best performers include disney, goldman sachs. now everybody knows a lot about utx. >> the hall mark of this rally since the election is this rotation of leadership. you can't point to one group that led the whole way. >> yesterday telecom was best performing. >> and health care was the loss. airline stocks pushing higher moving transports as a sector into record territory. the new york stock exchange acra index up. >> international air transport association putting out a report expecting airlines to make a net profit of $29.8 billion, down 16% from the 2016 outlook of

$35.5 billion. they did cite higher oil prices as biggest impact. >> is there time to buy airlines and if so which ones? joining us jonathan, served as informal adviser to the trump campaign starting in mid 2015. he was an officially designated media surrogate. also is chris terry, portfolio manager at hodges capital. chris, i will start with you. you guys are classic value investors and another classic value investor warren buffett recently bought airline stocks. the report says you will have higher oil prices, higher labor cost and slower demand next year and that will put a cap on airline profitability. what do you think about that? >> thanks. so a little insight into how we look at things and what we are doing. we own airlines.

we have owned them for a number of years now. thinking about next year earnings will likely be down. you have labor with the unions, pilots, flight attendants and then rising fuel prices. we have had a tail wind these past couple of years of deflationary costs. next year we have inflationary pressure. it will hurt earnings, hurt margins. earnings will likely be down. the wildcard is what is baked into numbers next year. one thing that is not baked in are higher fares. so if we get rising fuel prices and management teams start to raise ticket prices that could offset a lot of labe skpr fuel prices. >> what were you going to say? >> i was just going to say that could offset a lot of labor and fuel pressures that we will see next year. >> would you agree with that? it is interesting that it is not that much higher from last year

or shouldn't be relative to this year. that is a pretty big impact that seems to be happening. >> i view the future of the airline sector looking into 2017 as being positive and i'm pretty bullish on the sector overall. if you look at the last ten years of where the airline sector was it was really focussed on the idea that we are going to yield the price of air fares and figure out how to maximize revenue through pricing of air fares. over the last few years and next ten years the airline sector is yielding what i call the experience. in other words, paying that extra $50 or extra $20 to give a better seat or leg room or a better food and beverage experience. i think that the airline industry is not static now and is evolving and there is strategic development to look at. >> i see you have united, continental and allegeant travel on your list. you guys have owned american,

delta, southwest. let me ask you both. chris terry, would you buy more shares of these companies or are you just going to hang on here? >> we are hanging on to the domestic carriers. we may be adding to some accounts here and there. that stock has sold off with what happened in the peso. about two thirds of the cost are in dollars and that is only offset by about a third of the revenue. so with the peso getting weak that hit that stock unusually hard. >> are you buying united, continental and allegeant? >> i think those companies are really well positioned. i think united is well-positioned to go after growth in the asia pacific region. they have had a very aggressive expansion plan. i think that will yield great benefits. i think with allegiant great company out of las vegas looking

to develop that further service and going to develop more efficiencies as they take on newer air bus 320s. >> thank you both for joining us. >> thanks, guys. so we head to the close. we have 38 minutes left. the dow everybody is in record territory. major averages that we cover. the dow is up 66 points. i think we were up 100 at the -- >> looks like it from the chart there. >> we are off that high but everybody else is positive and in record territory. that inchuds the nasdaq. >> there is a flip side to the coin. as stocks surge bond prices have been tumbling. money managers discuss whether investors should be getting out of the bond market. lululemon shares getting a lift from earnings. detail on the yoga wear maker's comeback just ahead. when it comes to healthcare,

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welcome back to "closing bell." i'm sue herera with this breaking news story. john glen, the former u.s. astronaut and former u.s. senator has died. he was 95 years old. glen became the first american to orbit the earth. he was member of mercury 7. we was a senator from ohio for a number of years.

ohio state university's president has just put out this statement. the ohio state university community deeply mourns the lauz of john glen, true american hero. he leaves an undiminished legacy as one of the great people of our time. u.s. astronaut and senator john glen dead at the age of 95. we're back in a moment. what?pony neighing] hey gary. oh. what's witthe dog-sized horse? i'm crazy ressed trying to figure out this complex trade so i brought in my comfort pony, warren, to help me deal. isn't thatight warren? well, you could get support from thinkorswim's in-app chat. it lets you chat and share your screen directly with a live person right from the app,

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as we keep an eye on record markets we are closing up potentially at record levels if we stay here for all major averages. there is lululemon which is one of the best in the market. the stock upgraded and late yesterday reported earnings beat, increased guidance and a stock buyback. the share is up 15%. >> we have 30 minutes to go. here we go into the final half hour of trading with all major averages in record territory. joining me once again on the floor of new york stock exchange, we see the rally continue and broaden out. transports yesterday hit an

all-time high to go with what is going on with dow jones industrial average. are you a willing participate? >> i think you have to be a willing participant. this is a multiple expansion rally. it has been a long time since we have had a real multiple expansion. >> put your money in an etf and watch it go here.

>> there are probably sectors that are going to outperform. what we are doing right now is kind of sorting through what the likely scenario is for the trump economic proposals. it's pretty much like a three legged stool right now of tax cuts, lower regulation and a massive infrastructure spending program. so -- >> financials. >> industrials, materials. >> and those would be the likely candidates and then other special situations along the way. >> away we go. >> thank you, guys. time for a cnbc news update with sue herera. >> here is the news update. a powerful magnitude 7.8 earthquake struck near the pacific solomon islands prompting the tsunami warning system to warn that tsunami waves were possible in several areas. minority leader harry reid

bid farewell to the senate this morning after 30 years in the chamber and more than a decade as top democratic. >> i love the senate. i don't need to dwell on that. i love the senate. i care about it so very, very much. i have enjoyed congress for 34 years. as the leader here in the senate i have such joy. >> the international union for conservation of nature reports that the number of giraffes has declined by 40% since the 1980s in what they are calling a silent extinction driven by human causes. this moved the giraffe to vulnerable to extinction for the first time. >> this makes kelly very sad because we have established that i want to come back as an otter. >> and i'm a giraffe. >> it really is sad. i think it is going to come as

quite a shock to people when we were reading it everybody was like 40%. but as progress continues in some areas they don't have as much room to roam and it is human causes unfortunately. >> they can bring them over here. >> absolutely. >> we don't mind a big giraffe population. >> so we have established that while stocks have been rallying since the election the bond market has been going the other direction. yields have been going up. here is the look at the bond etf down around 2.5% since the election while major averages have been rallying. >> for more on if there is risk to being in bonds right now let's bring in chief investment strategist and sandy villere, portfolio manager and partner. thank you both for joining us. this is your bread and butter. what are you doing in this environment? >> it has been the consensus was

overturned in terms of the election. we went through an environment where people saw the u.s. as more to one where people are expecting a fantastic economy with the stimulus that is expected. the markets have made a couple of adjustments. the one is to what has gone here in the u.s. with the election and the other is japan and europe. >> if i may say that is all well and good but what do you do with your bond portfolio? >> i think that the market was really -- the outlook was for low single digit returns in the bond market, stable, low cyclicality in the economy. i would say the market is overly optimistic in the economy. bond prices are overly depressed as a result of this. we will see how the policies work out. i think it will make bonds great again and a lot of that progress

has been made. >> do you have a balanced fund? you are at the bear minimum allowed in the bond portfolio right now. >> that's exactly right. you look at infrastructure bill that president-elect is talking about. that will lead to inflation which leads to higher rates still and will have havoc on the bond market. the ten year has gone from 180 to 240. anybody who bought ten year lost 5%. i think that will continue. i'm at the minimum in bonds which is 25% of my fund. the max income in stocks which is 75%. i think that will be a good place to be. in my equity portfolio i have small and mid caps that will also do well in a rising interest rate environment. it will be tougher on larger multinationals. >> let me ask you. this is running into a huge demographic issue. the baby boomers have

overweighted bond portfolios. as you get older and near to retirement you need to protect your capital. all of a sudden are these assumptions changing and what should people do if they feel like if i get into the stock market it is at all-time highs and i could get burdened again there. >> i think when people sit down and start to look at december statements and realize how much money they lost in bonds over the last month alone they are going to get out of bonds and continue to flow into equities. i think that trend will continue and stocks will be the place to be. i would still be hesitant to invest in bonds at this point. >> there was a feeling that maybe the bond market was in a bubble territory anyway. is that what we are experiencing right now? do you expect rates to go much higher from here? >> we don't. we will have to see exactly what happens in terms of policy. assuming pretty aggressive fiscal stimulus i think that what you mentioned, the demographics, the high levels of

indebtedness and outside of the u.s. basically is going to put a lid on how high interest rates go. interest rates have backed up all around the world. i think that investors who stay with long-term approach will get a good balance between fixed income or equities. >> you look at performance as interest rates have gone up they have performed quite well. would you say you get out of government bonds but get into -- >> in our portfolios we have heavily involved in the spread sectors whether those are structured product or investment grade and high yield bonds, in some respects the more equity-like the best returns. >> good to see you both. thanks for your thoughts today. nice that they are both smiling. 20 minutes to go in the

market and the flip side is how well stocks are doing. dow up to 63 but high was up 115. so we are still off those levels. the s&p is up four points. nasdaq up 19. the russell up 19 to a fresh record for the small caps. not many people saw the election of donald trump coming. but tom mcclellan did. ahead on "closing bell" we will talk to him about what he thinks will happen between now and inauguration. trump adviser, friend, possible energy secretary harold hamm is with us. he will be ringing the closing bell today. we will get his take on the trump rally and his possible role in the trump cabinet coming up.

the rally continues on wall street. we have about 18 minutes left in the trading session here. the dow is up 76 points, was up 115. any positive close is a record for the dow, for the s&p and the russell. the nasdaq is joining the party, as well, up enough to put it also in record territory. >> let's get to the nasdaq for more on what is moving to record

levels with bertha coombs. >> the small caps helped the nasdaq move up. the nasdaq 100 record back in october. some big cap tech stocks have continues to lag here into december. today the big caps that are really moving things higher include the consumer stocks, costco, sears with better than expected elements of their quarterly earnings reports. also today one stock bucking the trend mylan saying it is restructuring after the big losses it has seen and fall following the epipen controversy. overall bio techs today continue to be the laggard. number of stocks hit hard including insys. former ceo and others arrested for allegedly bribing some to use their version. express scripts continue the

health care theme, the biggest loser in the nasdaq 100 as the short selling firm citron has issued a negative report. that analyst will be on fast money this afternoon at 5:00. it says it does everything it can to try to lower drug prices. >> thank you, bertha. meantime, the trump rally has been pushing energy higher. check out shares of continental resources up around 20% since the election. >> which puts a smile on our next guest. he joins us, founder, chairman and ceo, harold hamm who is getting ready to ring the closing bell to celebrate your company's 50th anniversary. i know it seems like just yesterday? >> not quite like yesterday. we are glad to be here on the floor of the exchange today. at this momentous occasion. ten years ago we became public

and 50 years in business and it just seems so short. >> seems like yesterday is when we spoke at the rnc and to think that donald trump has now won. he is quickly assembling his team. what do you think of his slaekz for epa and what do you think he will bring to that agency? >> continues to pick awfully good candidate for all the cabinet posts. so he is following through with what he told american people and he is picking extremely good people. couldn't have picked a better person for epa. >> what are the flaws with the epa that you think scott prut will try to solve? >> regulatory overreach. and the news that it has been used somewhat and so i think those are the things that he will --

>> i know you have already said that you have no interest in energy secretary. you is been a major voice to donald trump during the campaign on energy issues that face our country right now. if he called and said i want you to be my energy secretary would you say yes or no? >> he hasn't done that. second of all, we have a very exciting industry again and a future with the trump administration and don't have somebody trying to put us out of business. we can go back to work and put a lot of people back to work. we are glad to do that. we are glad to be where we are at. i'm so excited about our industry today. i'm so excited about the future and the possibilities. i have a very important job at continental and having more fun than i have ever had in my life. i want to continue that. >> 2017 could be an exciting year. sounds like more export

facilities for gas. we know what has been happening on the oil front. does this all mean that we can see cheaper energy prices for a long time for american consumers? >> we have done great things with horizontal drilling for the past 10, 15 years and certainly natural gas is one of those. we have 200 year supply of natural gas and the cleanest burning fuel. it's a tremendous thing, tremendous thing for the consumer. oil prices both gasoline and diesel fuel and natural gas. >> before we let you go, what would pea the ideal price? it's tough when the price of oil gets down in the $30 range, low 40s. it's tough to make money for a lot of smaller fracers out there. the consumers hate when it gets to $60 or higher. what is the ideal price in your view that would please both consumers and producers here?

>> you are still down $2. higher in some states with higher taxes. that's not going to hurt anybody. i think the recent cut that opec did which i think was wise and cuts in production will level out supply for a long time and for consumers. we're in for a very good environment for the consumer. >> what did you think when ivanka trump brought al gore to trump tower and talked about how she wants to make climate change a theme and if you do that maybe you are introducing carbon taxes or some kind of move that would not favor your industry? >> i wasn't privy to that conversation that went on there, for sure, but our industry just

like the balkan producing cleanest fuel. the country needed the diesel that is coming out of the high quality oil up there. and certainly with natural gas and the small foot print of horizontal drilling we are doing a great deal for the environment. >> i know they are anxious to get you upstairs. congratulations on the 50th anniversary of continental resources. >> harold hamm joining us. >> we have just about ten minutes to go into the close. dow is up 62. nasdaq is up 18 and the russell is up 19. all of these would be record closing levels. our next guest says the rally is not over. he says it is far from over and says buy the dips. i'm saying what if we never get another dip? that's coming up. go after it the same way? chasing after short term returns. instead if getting caught up with the crowd, the investment managers at pgim take a long term view,

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art cashin just told me that the market shows a bias to the sell side. $400 million to the sell side. the dow up 66 points, in record territory. joining us here is raymond james chief investment strategist who

says buy the dips here. my question is what dip? will we have another dip? >> the only dip we had was after the night of the election, and we did buy that, as a matter of fact, on a trading basis. i was with larry fink for lunch over at blackrock. he said it's the biggest honeymoon he's ever seen and you ought to stay long stocks into the inauguration and then reality is going to set in. >> is that your thought as well? >> my timing model says this grinds higher in the end of january, beginning of february, so yeah, my model agrees with that. >> losses on the bond side, what do you buy, where do you go? >> i think the convertible market right now -- >> convertible debt. >> not convertible debt but convertible preferreds. you won't capture the whole up side of the common stock but there's some pretty interesting

situations that i think if you had to put money to work. >> what do you do with sectors? we established here the rotation that's going on here, get new leadership each day it seems anymore. >> yeah, and i like most of the sectors. i do not like utilities and the staples because a lot of people were playing these chicken longs. they bid up the cloroxes to 30 times earnings when the company tells you we're only going to grow 2 or 3% a year. >> everybody was buying yield. not growth, buying yield. do you not buy yield anymore? >> value has outperformed growth since the election noticeably. where raymond james specializes in is the small and midcap stocks and they've been on fire. >> so mostly just thinking through the u.s. dollar, people are thinking about the impact there for the bigger names that you're mentioning, tech, health care, what about the prilaces tt we've seen participation. >> material makes sense here. i think inflation is going to

come back. in fact, it's starting to come back right now. i have no idea, you know, what degree it's going to come back. but i think some of the inflation hedges make sense here. >> our mike santoli was reminding everybody how some of the overseas markets have done. the european markets have performed better than the u.s. market. >> europe is cheaper than the u.s. market, but europe has issues. >> they have issues but with mario draghi beginning the tapering program today is that a signal that maybe they're on the mend to begin with? >> i think you cannot strategically not saying i'm y buying europe, but buy individual names that play to themes. nestle is a name that makes sense to mep about for somebody like siemens or the old asa brown braver ra. you can take out a shotgun but not just buying europe. >> jeff sauk from raymond james joining us today. the dow up 59 points.

>> then after the bell we'll be going live to trump tower where reports are circulating about the nomination of a new labor secretary. you're watching cnbc. s my headq. this is where i trade and manage my portfolio. since i added futures, i have access to the oil markets and gold markets. okay. i'm plugged into equities- trade confirmed- and i have global access 24/7. meaning i can do what i need to do, then i can focus on what i want to do. visit learnfuturestoday.com to see what adding futures can do for you.

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session here as we head to the close, bob pisani joining me for the closing countdown. i'll just put the graphic up. they're all in record territory right now, the dow, s&p, the russell and now the nasdaq joins the party we didn't have room but we can add the transports. >> so the themes today at the trump rally, gdp expansion in 2017. we have seasonably strong parity of the year and we have rotation going on. >> that's the thing. that's the really very interesting part of all of this is you have different leadership each day. if you have leaders, you will have laggards. interesting laggards today. >> real estate's been up, utilities, even some of the tech stocks have been up. so there you see real estate and utilities, they were laggards. those industrials, that's what i'm talking about. we've seen the defense stocks which is big leadership groups, they were all weak today, northrop, raytheon, and we saw

general industrials, illinois tool works, united technologies a little bit weak, too early to call a trend here, but i'm watching that. >> bob, thanks very much. we go out with record highs once again. as we mentioned earlier, harold hamm, the founder of continental resources celebrating the 50th anniversary of his company, he's ringing the closing bell right now. stay tuned on who the new labor secretary might be. coming up on the second hour of "the closing bell." see you tomorrow. thank you, bill. welcome to "the closing bell." i'm kelly evans. again we have a record close on wall street. i believe for all the major averages, the dow at a new record high of 19,612. s&p 500 lagging a bit, only up 0.2 today. that's still good enough for 2246. that's a record close for the broad market index. the nasdaq which yesterday did

not participate closed just shy of its record. did that today. it added a half a percent to close at 5417. that's a new high water mark. the russell 2000. the best performer today of 1.6% to close at 1386. now, health care has been sitting out this trump rally actually falling about 1% since the election. is now the time to buy the dip or are the risks too great going into a donald trump presidency? we'll debate that coming up. on today's panel we have meekal santoli here along with stephanie link. for more on today's market action, brian kelly who is fired up about the euro and the chinese yuan and inflation. we'll get to all that. welcome, everybody. but mike, first, just some thoughts on this -- you know, people so i hear are starting to use words like meltup. and quite the rally. >> meltup is a pretty accurate description i think of what

we've seen in the last several days. i think we're at that point in the rally where we can kind of see why we got here. i would point out 10% up for the s&p 500 year-to-date. about a 12% total rourn. ten-year bond up. you can look at that from a broad angle, that kind of makes sense. maybe a little bit generous. the marjt rally at this point doesn't owe you anything. people are getting too bullish in the short-term. just because it doesn't owe you anything doesn't mean it will be taking it back. >> well, i'm enjoying the rally for sure, but i don't think it's just the trump rally and the pro growth inflation rates kind of story. yes a lot of it is that, but also that the u.s. economic data continues to get better. initial claims were fine today but you've had better gdp, much better consumer confidence at cycle highs. >> you can almost say that's still a trump phenomenon. look at the isms, hard to know

is the manufacturing and services sector the fact that they're at breakout levels, does it reflect the election? >> it's interesting that you say that. obviously it has to do with it. but when you have jobs getting better every single month and you have wages increasing gradually, then the confidence comes from the stock market. what is interesting is i've talked to several companies recently and the ceos have expressed pretty unanimously that the small business community is getting more excited. now, that doesn't mean that they're spending more or getting more loans or that kind of thing, but their attitude has changed. that's step one. then once all the policies get enacted, then that means that they will probably act on those and you could see maybe better growth going forward. >> linda mcmahon now head of the small business administration. we'll see how that goes for people who are looking for a little help in growing. the cfo optimism. that's at like a decade high. this is a notoriously dour group at times. >> as are the small business

owners. they were fighting the idea that this was a good economy for years. and i do think maybe it's because both cfos and perhaps those business owners at least can see a glimpse toward the deregulation, the shortcut stuff that a new trump administration can do in terms of deregulating from the executive branch. that might be just enough of a help right there, then if you get tax on top of it. >> just when it comes to the market there are people saying to themselves, well, if i am going to sell anything, i'll wait till next year. maybe the tax rates are lower. what ip pact is that having on the rally? >> that's having a huge impact. we know that tax rates are unlikely to be any higher next year. if you have the problems why not wait and you can sell them and have the idea that maybe i'll get a lower capital gains tax. that's why you're seeing this meltup here. the supply of stock is just not there right now. >> already there's a lot baked into that if we don't get

something. it takes a while to get that train moving. >> you have to really set your expectations. if you're near term between now and the end of the year and into the inauguration, you can just stay the course of what you own. i think it's this continued cyclical rally. i was encouraged that consumer discretionary participated, technology participated. you get a little broadening out because the cyclicals are getting a little rip, getting a little expensive. i like that they're broadening out. maybe that continues until we get to some of the policies, then we'll have to see. >> i also wonder going back to some of the events from earlier today where the european central bank made changes to bond buying program, is that giving us a second leg to the rally? it's hard to interpret what happened if you look at the market reaction, it's kind of going one way then the other. you have people saying buy european stocks if you missed the rally. it's a mixed bag. >> i think, yeah, so again the takeaway is the u.s. has become the best place in the world to

invest again. so europe what they did today potentially is even more negative rates. yes, the currency is weakening and probably will likely weaken further. what's the growth engine? that means money flows back here to the u.s. >> the interesting thing is, if you look at the european stocks, look at the european banks, they're rallying hard, right? because that's where the value really is. yes, fine, he'll actually continue but he's tapering it to some degree. there's puts and takes. he's not getting more on qe at this time. the growth is not accelerator. >> editor of the mcclellan market report. saying the rally will only last until inauguration day when they realize that trump may not come through on all of his promises. you're the person to add here.

welcome for joining us. >> thanks, kelly, let me start by saying -- >> yeah, go ahead. >> go army, beat navy. we've got the big game coming up. army is due. >> i can expect you to draw a market parallel from that, too. but this whole idea of buy the election, sell the inauguration, are you speaking just to people in the market in the short term? is there still stunt fopportuni those who see risk on the bond market side of it? >> i do see positive stock market overall for 2017 but i see trading opportunities within that. yes, typical when you get a new president especially from a new party that all the hopes of everyone are hung on the guy and he can't possibly live up to that. then after a couple of days he's been in office and he hasn't solved all the problems yet, people get disappointed and they finally start to sell their stocks again. i wouldn't be prized to see a pop in late january. i was interested to hear jeff sauk say early february because

some of my icycles point to february 9th as well. >> the current rally is far outperforming that general pattern that you point out, follows the presidential cycle. i guess i wonder what your indicators are telling you right now about the condition of the market at the moment? obviously a lot of people talking about being overbought. it's kind of stretched a little bit to the up side. what does it look like tactically to you? >> well, compared to the presidential cycle, the best use for that is to get the direction right. you got to remember that's an average pattern. so half of the time it will be above average, half of the time below average. we're getting the direction right. it's going up like it's supposed to, stronger than it's supposed to. the thing that you have to understand about the stock market unlike other markets, it tends to see the biggest upward acceleration at the beginning of advances. you will see deceleration of the advance before you see an actual downturn. right now new 52-week highs making larger numbers. mcclellan oscillator that my

parents created maker larger than upward numbers. this is strong upward initiation and it's not done yet. >> you look at gold and bonds or maybe the dollar, things like that. what else are you reading in terms of some of the really big moves that we've had across all asset classes? >> well, gold and bonds are both universally hated. everybody is all excited about getting into small cap value. we saw gold and bonds both turn up on wednesday. and we saw the total assets in both gld and tlt continue to fall. normally those will move in sync with higher prices. so declining even with higher prices and boat gold and bond etfs, that says that the public is really just done with them. they've washed their hands. they're never going back there. they hate them. so that gives them the most room for up side.

generally speaking, though. >> i'm sorry, tom. keep going. >> generally speaking, 2017 should be a good year because there's just gobs of liquidity trying to get into the door and into the stock market. for long-term investors it's a good thing, for traders there's opportunities. >> brian, i was going to bring you in here. >> tom, you said that gold is unloved. does that mean that you like it? because i'm long gold, i'm seeing what you're seeing but i think investors are missing the inflation picture here. >> gold has been going down since 2011 despite low inflation. and the linkage between gold and inflation has been overtold and overly believed. there are other things that matter more. but you have to remember gold is a worldwide currency traded by everybody. what you and i are seeing in dollars somebody else in drachmas or rupees or yuan are seeing a totally different picture and they have their own reasons to bid up gold. what i see is a 13 1/2-month cycle is a little bit overdue

for bottoming. it can be plus or minus a month and still considered on time. it's a major important bottom. there's also an eight-year cycle in gold that's at a bottom right now. both of those cycles should be nesting together and creating a great opportunity for gold that nobody will believe as it finally gets started. >> sounds like what happened in the first quarter of this year when gold had its best first quarter in decades. >> that was at the beginning of the last 13 1/2-month cycle which is when the big advances are seen in gold were in the initial phases of that now. just waiting for gold to finally wake up and realize that it's supposed to be going up higher. once it does, people will jump in and say, oh, wow, look at the hot new thing, let's pile in there now. right now that's what gold is doing. >> if that's how it all plays out, you're right, a very unloved part of the market. tom, thanks for joining us. >> nice to be with you. >> tom mcclellan of the mcclellan report. restoration hardware just put out its earnings.

>> if we can take a look at shares of restoration hardware, you'll see that they're falling sharply. the company had a strong third quarter with earnings coming in at 20 cents beating analysts' expectations by four cents. comp sales were down 6% and wall street was looking for almost double that as a decrease and that didn't happen. if you take a look at the fourth quarter guidance and four-year guidance, it's really pretty bad. that's sort of the best way to describe it. they're looking for earnings per share in the fourth quarter of 60 to 70 cents, analysts were looking for $1.08, similar picture when you look at the fourth quarter and the ceo throws almost everything at it saying that the business was softer because the fall source books were mailed later in september. so some of those sales are going to be offset. softness because of the u.s. election and so that's also part of the reason that they're giving. they're saying that the holiday sales are also lower than planned. as a result, they'll have to

take larger than expected markdowns. they're pulling back on capital expenditures. while the third quarter was good, the fourth quarter and full year for the expectations not so much. kelly, back to you. >> the restoration hardware shares down 19% after hours. we were saying lulu lemon. >> just slightly light. honestly up ten bucks in a month this stuck down $7 in a minute. that's the way it goes. >> the stock's up 50%. that's totally different than lulu. lulu was down. good quarter not taking anything away from lulu, but this one not so great. last quarter was fine but they pulled forward sales. so you wanted to see better sales this quarter, better margins. it got ap okay quarter but that guidance is really disturbing. maybe revamping their strategy trying to do less promotions so the margins could make up for the sales being on the light side. that doesn't seem to be working. it's not a cheap stock.

>> now they're talking about markdowns. the last word to you just circling back to what we've seen all the major indexes at record here. >> then you have restoration hardware. what's interesting about that is it is now after the election they're giving guidance that is weaker. it would suggest that things have not picked up for them. while the election might be the excuse, it might not be the right excuse for them. >> thank you for ginning us. be sure to stick around and catch brian and the fast money crew coming up in the next hour. andrew left says the stock is in big trouble after trump. he'll be on at 5:00 p.m. eastern. the trump rally pushing on with stocks hitting record highs but health care sitting on the sidelines, down 1% since the election. does the dip represent a buying opportunity? that's next. rising interest rates have many investors picking bank stocks but does it pose a hidden risk

to the run in financials? that's coming up about and can you plain to me why you recommend synthetic over cedar? "super food"? is that a real thing? it's a gre schoo but is it the right the one for her? is this really any better than the one you got last year? if we consolidate suppliers what's the savings there? so shoulwe go with the 467 horsepower? is a 423 enough? good queion. you asa lot of good questions... i thk we should move you into our new fd. ok. sure. but are you asking enough about how your wealth is managed? wealth management, at charles schwab.

. welcome back. more earnings to get to. clothing company duluth. >> duluth is the rugged workwear type clothing. earnings out one penny. this street was looking for flat. not much to report there. the revenues down sloitly at 67 million. the street was looking for 69 million. but really what's pulling down the stock sharply, you can see down more than 17%, is the outlook. so the full year earnings and revenue guidance is below estimates especially that earnings estimate that is really below what wall street was looking for. you can see again shares there down more than 17% after hours for duluth. >> wow, another big one. i wonder if it's marketing spend. duluth trading company. down 18% after hours. while the broader market is hitting new record highs, the health care sector is down nearly 1% since the election. we know president-elect trump is planning to take a tough stance on drug prices as "time's" man

of the year told the magazine, quote, i'm going to bring down drug prices. that sent health care stocks down yesterday. joining us is the health care analyst at sanford bernstein. we'll start with you. this is one place where people say where should i get into the market? everything is at record highs? not here and it is an opportunity? >> it is an opportunity. if the election was different, it would we down a lot more. there's price discovery that needs to be done and price reduction. he's a free market person. there's other costs in the health care area where you get into waste, fraud and tort reform. essential drug pricing is in the crosshairs. >> but if that's the case, what does it mean -- these are broad things. we talk about the health care companies, so many different ones in that basket. we talk about drug prices just one piece of this. who is relatively safe versus probably a target here? >> one that's a really great

large cap company, gilead. it's a tax loss selling name that people will do at the end of the year but next year very cheap, trades six, seven times earnings. it's acquire. >> where do you see opportunity? >> i guess alagan, shier, biogen. those are the ones that will do the better. >> for either of you, when are we going to see this m & a. you talked about gilead. they haven't acquired anybody and they need to acquire somebody. when are we going to see m & a in this group in a big way and will that be the catalyst to get these stocks going again? when is the time for buying on weakness? >> you're tired of waiting. >> if you bought, you were totally wrong and that would be me. i'm curious as to what is the

right time to buy? >> chris, first you. >> cmas do m & a when they can see some confidence over the horizon. you can't always predict a bottom. but when donald trump comes into the presidency and we have a clear path as to what he might be doing and they might be dusting off their playbooks. >> i'm not so confident we're going to see a rally near term. the problem with the drug stocks is circular. they have to knock the total cost of drugs off. and it's just hard to perform on top of that. what companies are looking for, frankly, are validated new drugs that are differentiated. and those are essentially priceless. they won't wait for elections to buy those stocks. they'll buy those as soon as they got a nice drug they can buy. what you are seeing is scarcity of good targets to buy. if i got to point to a time

point that will make a difference is when you can repatriate all the cash that the drug companies are keeping overseas, then there might be a bit more of impetus to step up and take a bit more risk. if you have a good drug, somebody's going to buy it. >> one area that none of you guys have mentioned, chris, i'll ask you, really beaten down in the crosshairs, endos, mylan, they may trade at three to seven times earnings. >> pharma had a tough time since about a year ago. what will be a tail wind for the space is deregulation. the cost to bring these drugs out, look at the orphan drugs, why opportunities. why stand in the way of these drugs. allow them to get through the fda. he's going to deregulate. that should help on the cost line of drug development. that's a real benefit i see. >> before we go, where would you go in the health care space now? >> the only place that's been

working is the hmos. i don't really like to chase momentum, but i do think that that group will continue to work. and they will benefit from a strong economy and higher interest rates and if we get this repeal of aca. but i'm very tempted to add, i own a little bit of allergan, lexion, i own the right companies but the sentiment is so terrible. >> thank you for joining us. donald trump expected to pick fast food ceo andy puzder as his secretary of labor. he's against raising the minimum wage to 15 bucks. what the fast food ceo could mean for america's job markets next. there's just 23 days left in the year. how should you be positioned to minimize the tax burden or your winning investments?

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sixty to seventy million people are moving to cities every yr. at pgim we help investors see the imications of long term megatrends like the prime time of urban expansion, npointing opportunities to capture alpha in real estate, infrastructure. partner with pgim the globalnvestment managent welcome back. donald trump's cabinet is slowly taking shape and he's expected to fill another spot shortly. andy puzder is reportedly up for the job as labor secretary. john harwood joins us from outside trump tower in new york city and what this would mean for the labor market and jobs in america. john? >> kelly, yesterday andy puzder was in trump tower talking to the president-elect. today he is the president-elect's pick to become his next labor secretary,

assuming he can win senate confirmation. he's a conservative republican advised mitt romney in 2012, is a strong supporter of reduced regulations. on cnbc this spring he talked about the accelerating appeal of labor saving automation. >> the working class needs a period of transition. we need to be able to train them. we need to be able to set people up for better jobs. we need to revamp the education system to people actually are qualified to do the jobs that exist. what's happening now is the cost of labor is accelerating at such a pace that it really moves up how fast you want to automate. >> he has gone on to say in other settings that the robots that are the automated machinery that are used to supplant labor they don't take sick days, they don't have slip and falls, they don't take vacation. all of that is part of the appeal for business but it's also part of why democrats are

concerned. we had a statement put out this afternoon from eric snyderman, the new york attorney general, saying that andy puzder has done everything he could to undermine labor by opposing the higher minimum wage, the $15 minimum wage that democrats are in favor of by opposing the obama administration's rules on overtime. so we may see a battle for confirmation of andy puzder, but for now he is the president-elect's pick to be labor secretary, guys. >> john, thank you so much. john harwood outside of trump tower there. so andy puzder very familiar name. people in our audience, obviously he writes a lot of op-eds for "the wall street journal." he keeps a blog. he's very passionate about some of these issues and the way he thinks regulation and including the minimum wage will hurt rand destroy more jobs than it helps create. >> his industry is certainly against minimum wage saying it would kill jobs at that level. what i find interesting is the apparent dissonance between his

approach and the gesture by president-elect trump to preserve higher cost, lower productive jobs in indiana. what's exactly going on when the ceo of united technologies says, look, the workers are cheaper, more productive elsewhere. >> and he said we'll have to do more automation for us to run efficiently. >> a lot of companies have to do more automation, a lot of companies have to invest in technology. they haven't had the business confidence to do it, to spend that money. i think there's a balance here. i listen to someone like mcdonald's and easterbrook's ceo, he's been focused on getting more technology into the stores but he's not doing it at the expense of jobs but he's doing it as a kind of complement. i don't think it has to be one or the other. >> that's the hope in all these confirmation hearings. >> a fast food job, a lot of times the companies don't necessarily consider them to be your permanent job to be a breadwinner as opposed to an assembly line job. >> let's send it over to dominic

chu. he has an earnings alert for us. >> this is on -- i should say i'm living in the past, it's broadcom, used to be ivago. that beats the analysts shares. coming in slightly better 4.14 billion against a 4.128 estimate. the resulting move at least for the time being is a 2% gain in the -- 2 1/2% gain in the after-hours session. but that's the story right now with broadcom, guys. back to you. >> dom, thanks. time for a cnbc news update with sue herera. >> here's what's happening at this hour. the house approving legislation to continue funding the federal government at current levels through april 28th of 2017. it averts agency shutdowns that would recognize begin at the end of this week. the bill now heads to the

senate. three people were killed in a pile-up in michigan that involved up to 40 vehicles. it occurred on an icy interstate near the state capital of lansing about the interstate was closed in both directions. life expectations, which has been rising for decades, declined in 2015. it is now no better than it was four years ago. the decline was unusual for a year that did not include a major disease outbreak. the last decline was in 1993 when the nation was in the throes of the aids epidemic. and an american hero has died. john glenn, the first american to orbit the earth back in 1962, and a democratic senator from ohio for 24 years, has died. he returned to space in 1998 at the age of 77 aboard the space shuttle "discovery." he was the last survivor of the original mercury seven astronauts. president obama praised him as an american icon. john glenn was 95. we're back in a moment.

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another historic day on wall street. the dow adding 65 points to a new record close of 19614.

so we are marching on towards that 20,000 mark, believe it or not. the s&p 500 up nearly four points. the nasdaq up nearly half a percent catching some attention as it finally closes at a fresh record of 23 points to 5417 and the russell 2000, the small caps have been the story and they led the way again today. up 1.6% to 1386. financials have also been a big part of the leadership in this trump rally. they are up about 18% just since the election. but could rising interest rates prove to be a quiet headwind for the sector? kick bove joins us to talk about exposures people haven't thought about. >> basically if people are worried about higher interest rates causing problems, it's not going to happen in the near term. because basically the securities which banks own have durations of two to three years.

by the time anyone is ready to write anything down, these things will have matured and the bank will have turned over its portfolio. there's no problem there. the problem with interest rates rising very rapidly, which i don't think anybody expects to see is it drives the asset value of the banks down, which hurts their capital, but again that's not in prospect. anything that could be going right for the banking industry is going right. the economy's going to be a little bit stronger. interest rates are going to be a little bit higher. bad loans are going to be not there at all. the cost of doing business is going to come down somewhat, and the stocks are not selling at high prices relative to their 15-year averages going back to the year 2000. they're cheap stocks, they've got to be bought. >> i'm curious as to your thoughts about -- i totally agree with you being bullish on the group and a lot of things are going right. so i look to see what could go wrong as a pm just on the other

side. when do we start to see the cycle turn? the second half of next year or where do rates have to go to start to see a credit cycle turn? >> i think basically two areas you would look at. first, i think that commercial real estate is a problem area for the banking industry. i don't think there's any question about that. because you can't keep building buildings faster than the economy's growing because there won't be enough income to pay the rents. secondly, in the auto finance area, there's been a lot of really bad stuff done going back to the days of subprime lending. you know, that certainly is going to be a drag, you know, on earnings at some point. but quite frankly, as long as the economy keeps growing, the banks can absorb it. interest rates, if we take a look at, i don't know, 2 1/2, 2 3/4% on the ten-year, that's not a high rate. 3, 4%, that's not a high rate. if we look at history. so it's very hard to see where the problem's going to come from

in the banking sector at this moment. >> let me just point out that what the journal was saying about this today, dick. they said u.s. banks suffered a $6.5 billion unrealized loss on the value of securities they hold as investments as of november 23rd. the first time since 2014 had showed a loss on these securities for the banking system as a whole. so you know, what are the risks from further losses admittedly unrealized on these holdings? >> yeah, well, again, the point is they're unrealized, number one, because, you know, bank accounting is -- unless the security's held in the trading portfol portfolio, you don't run the loss through the income statement if it's an available for sales security in the portfolio, you mark it against capital, but you don't run it through the income statement. and if it's held to maturity you never run it through the income statement. so if the bank holds maturities of two to three years, by the -- they won't be running anything through the income statement. and the fact of the matter is

what the general could do is write an article as the "financial times" did that over the last six or seven years, the cost of regulation has been $200 billion for the banking industry and the cost of litigation has been 160 to 175 billion. so that's an average if you put the two numbers together, we'll see somewhere between 350 to 400 billion. and that's not over ten years that's over six or seven years and that's going down to 5 or $10 billion a year. that's a massive, massive increase in earnings which overshoots anything that the journal can talk about concerning unrealized losses that will never show up on income statement because the journal can stop saying negative things about banks. >> mike, is there anything you'd add? >> i guess i was just wondering, dick, is the 15-year scale the proper one to decide if these banks are properly valued in terms of price to book or price to earnings given the fact that the returns on equity, gold mma

sachs they're not getting back to 30% ores at any time. >> and why should they? there's a chance they could get back to 10 to 12%. people who look at banks always find a way to argue that they shouldn't go up. for the last 12 months, bank stocks have been dramatically outperforming the market. we put together an index of bank plus apple and compared it to a portion of bank stocks. bank stocks have gone up six times faster than technology stocks but people can't find anything right to say about banks. they can find only wrong thins to say. that's why they missed the whole market. >> they got to come up with a jazzy acronym. you know. i'm sure you can help us with that, ki dick. dick bove. and for more on the trump market meltup, you can check out my

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welcome back, the stock market has seen a huge run-up sense the election. now is the time of year when many are wondering if they should take advantage of tax

loss selling. when you sell a losing nnkment to offset gains from other investments and reduces the amount of capital gains tax you owe in the upcoming tax season. should investors be doing this after this end year rally? let's bring in ric edelman. welcome. >> good to be with you, kelly. >> there's this idea out there that nobody should pursue -- >> well, no, for a couple of reasons. first of all, a tax deduction today is the better of the hope of a tax deduction tomorrow. second if there are changes in tax law don't be so sure that will become effective in 2017. very often they take effect in the following calendar year which would suggest january 1 of '18. i wouldn't put this off. >> what are you telling people to do right now? pursue the usual strategy at the end of the year here? >> yes. take a look at your portfolio. the odds are you might not have any losses in your portfolio

because of the run-up we've enjoyed since the election. but if you do have losses and you can replace them with equivalent holdings because you don't want to destroy the integrity of your portfolio merely for this reason. but if you can do it efficiently, effectively, then sure, there's no reason not to take advantage of tax loss harvesting. >> ric, at the risk of bringing aup sensitive topic, we were just talking about automating of jobs earlier. a lot of the advisers they have these tax loss harvesting engines that they go on auto pilot and try to find these opportunities. is that something that folks like you can use or is there an advantage to plugging into one of those? >> there's no real advantage for somebody like me in a firm like ours. we have all of the sophisticated software programs and it's an integral part of the practice that we provide to our clients in looking for these opportunities. but for ordinary investors doing this on their own, they should probably take advantage of

automated software, there's a lot of firms that use them, not just the robo advisers that you mentioned but the big box firms and discount brokers they provide these kinds of services and software programs available to investors because tax loss harvesting is a fundamental element of proper portfolio management. i would be surprised if somebody using an adviser didn't have this taken care of for you and, quite frankly, that's the first question you ought to ask an adviser on the subject. do you do this for me routinely? and if not, why not? >> what about losses on your bond portfolio? what are you advising people to do here? >> the bond portfolio is the scariest part of the whole conversation as you've been covering very well of late. we're taking the same attitude as everybody else. the interest rates will be rising. we don't know how quickly or how much but clearly over the next several years rates will be higher than they are today. we're moving our clients and have already done this out of long-term bonds into short and intermediate where they'll be

much less sensitive to interest rate fluctuation and the costs of that people are going to be facing from portfolio losses. short-term and intermediate is the way to go with bonds. >> even older clients, ric? >> very much so. the difference is if you take a look at the 30-year yield versus the 5, to justify the incredible volatility that 30-year paper is going to facep about i don't care if it's government, corporate or municipal. so retirees who are dependent on income need to look at a totally different approach for generating income over the next ten years. >> all right. ric, we'll continue the conversation. thanks for joining us. appreciate it. >> you're welcome. >> ric edelman. they may be the most famous investing club in the world. with a three-decade record we'll check in with the beardstown ladies. ♪i had to leave my happy home in exile♪

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for more than 30 years, the women of beards town, illinois have been some of the best known investor in the world. our kate rogers traveled to the land of lincoln to see what those beardstown ladies think of this trump rally, hi, kate. >> reporter: these ladies are so famous, they have their own museum exhibit here in city hall where we've been live all day. the ladies say they weren't too surprised about donald trump winning the election. now they're focused on ways to strategically invest in this new administration. >> i was glad he was elected, we watched the market go down one day and then came right back up. on the committee we're looking

at stocks that are perhaps going to be helped by adding more to the military and defense stocks. so this is the type of thing we're looking at to consider buying. >> they're also watching closely the health care sector because they're not too sure what's going to happen with obamacare. they say they wouldn't mind a little volatility either, even though they're loving the trump rally. >> i feel like the best is yet to come, honestly. if we do hit a correction, it's time to shop. >> over the past 30 years, the strategy has been the same, always it's to invest in what you know and hold it for the long term. sounds like warren buffett, right? he's one of their idols. they've been to the berkshire hathaway annual shareholders meeting a few times. the ladies say they're holders of berkshire class b shares, they can't yet forward class a. >> mike, you remember these ladies from the late '90s.

are we back to rational exuberance? >> i think so. i think we've got a ways to go before that. there might be a little bit of hazard, to say anybody sitting at home can pick these stocks and go up against the fancy quantitative machines, and it's easy. but the discipline of putting your money to work and knowing what your money is up to, anyone can benefit from that. >> is this group flourishing, kate? >> reporter: kelly, they've got every generation represented. the youngest is in her early 30s, the oldest will be 90 in june. they have every generation represented. also diverse careers. we had a funeral parlor owner, a retired hog farmer. they used to invest using value line and they've since switched to the internet. they're big cnbc fans, they said. they say that's made everything more volatile, it's more minute to minute than it used to be in the past.

>> they're not trading tick by tick, right? i would imagine they come together in some sort of quarterly or even that frequent for investment decisions. >> reporter: they do it every month. >> wow. >> reporter: they started with $1600 in 1983 and each month now they kick in 25 bucks. it's grown to about $450,000. they've got a portfolio of 17 stocks with apple, walgreen's, wolverine. definitely a diverse portfolio. it's all things that they know and understand. they do their research on it for sure. >> i love it, the beardstown ladies. kate, thanks for bringing us the story, appreciate it. kate rogers joining us out of illinois. restoration hardware has been sinking on earnings. the conference call starts at 5:30 eastern time. we'll get you set up for that, next. ngine revving] ♪ ♪

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welcome back. a half hour from now, the conference call for restoration hardware begins. the stock is down 16%. their outlook for the holiday season, it seems like not much is going right for this company. >> a company with bad news like this is going to get sold.

it seems hit-driven. they really seem to have to hit their spots. >> they actually decided to get rid of some of the smaller holiday tchotchke kind of things. >> the only thing i've owned from restoration hardware is a $10 pair of those booties with the fleece on the inside. they were wonderful. >> oh, it's wonderful stuff. it's just very expensive. you're starting a certain customer right now who is continuing to be very choosey, very specific on what they want. >> the people who aren't choosey are investors when it comes to this market. if it's not restoration hardware, who in the retail space is working right now? >> in the last month alone i do have to seen beaten-down specialty retailers do quite well. it's hard to chase those. you've seen a little bit of a resurgence in the department stores, they got beaten down so much, now we'll get a cold

streak, i think, maybe more reason. >> kohl's, macy, they had a bit of a comeback. any idea that the top line can budge because of pricing or because consumers are in a better mood. >> you don't want to ignore amazon or online, that's an amazing presence. and i know the valuation on amazon is not nearly as easy to handle. but i do think in the low 700s, it's not going away. it's a great growth story. they're taking a lot of share. >> the s&p 500 is up 22% since its february lows. i don't remember if it was late jan or early feb. how about jpmorgan, remember when jamie diamond was buying stock? since that diamond bottom, quote unquote, shares of jpmorgan are up 60%, financials are up broadly, 48%. the etf for xlf is up 50%. the guys ran the numbers and

said he probably made $50 million on this year's trade. i mean, the guy has an in that case knack for it. >> i would love to ask him, in february did he think he was going to bottom tick the stock? you think most likely not. bank of america has doubled. >> jamie diamond is very focused on his stock price. he'll even say, maybe as a company we won't be buying if we don't see as much value. at the goldman conference last week he kind of implied that, maybe he'll do a dividend buyback. he's focused on the stock price. >> you look at what's happened with interest rates, he mentioned the trading volume. >> it's been a long time since we raised estimates, it started last quarter, before the trump rally, before rates started to

take off. people are chasing. >> the biggest sign of the rotation is jamie diamond will be head of the business roundtable. caterpillar was previously in charge of it. a little sentiment gauge for today. that does it for us. "fast money" begins right now. "fast money" starts right now. live from the nasdaq market overlooking new york city's times square. i'm melissa lee. tonight on "fast," another day, another record. it's been exactly one month since the election. stocks have been on fire. but do not worry, if you missed the rally, three stocks you can still buy right now. plus the casino stocks crapping out today on a report that the chinese government may limit atm withdrawals. we're clever here on "fast." jim cramer spoke to the ceo of mgm moments ago. and