response to the u.s. sanctions. so there you have it. slight tick lower as we look to close out the year. >> i'm sure "closing bell" will pick this story up. have a wonderful safe, happy healthy new year. >> "closing bell" starts right now. hi everybody and welcome to "closing bell" on this new year's eve eve. i'm kelly evans. >> one more time for 2016. i'm bill griffith. stocks are ending the wild year. major averages being stymied by thin trading volume although we are moving lower here. >> check out the gains for the year. the dow is up more than 13%. the s&p rising about 10%. the nasdaq up nearly 8% and the russell 2000 almost 20%. we are going to run through the

specific winners and losers and top managers recommend stocks to fatten up your portfolios. >> coming up, two main street investors, folks like you will tell us whether they are excited or down right nervous about investing in the year ahead as president-elect trump gets ready to move into the white house. >> plus thomas pickering weighs in on the latest skirmish and how the election hacking situation can play out from here. >> let's get to winners and losers of the year. we have bob pisani running through them and susan lee tallies them up over at the nasdaq in just a moment. bob, you first. >> best performers on the dow had a terrible january and february but started up after that and generally stayed up. here is number one caterpillar up 36% on the year. a lot of hopes in the fourth quarter. infrastructure we will see about that. united health care another big name that moved up here. health care did well in the

first part of the year kind of side ways in the third quarter and then took off again in the fourth quarter here up about 36%. number three, financials didn't do that. the financials had a lousy first half of the year. boy, did they take off when interest rates started moving. goldman sachs up 33%. same with oil stocks. nothing. terrible performers. take a look right here. chevron ended up 31%. modest bounce in april. side ways until the election, started taking off on higher prices around the opec agreement and partly on overall trump rally. dispoints we had some. remember what happened to nike? nike had a series of what you would call disappointing guidance. rival adidas gained ground.

nike ended the year down about 18%. there are two or three stocks overall. here is the important thing going into 2017 on this last trading day. the s&p is up 10% year to date. as for the disappointment about dow 20,000 we are less than one percent from historic highs. and the advance to climb line is still at a high. most stocks are continuing to advance as opposed to decline. that is what you want to watch most of all. happy new year. >> and you, too. we are going to see you shortly. let's get to susan lee at the nasdaq with the wrap up of the year's winners and losers. >> we are set for an eighth straight year of gains which is longest winning streak since before dot com bubble burst. it took 16 years but we got there. best performer this year still is nvidia.

the graphics chip maker is still up 224%. that is the biggest points contributor in 2016 to nasdaq. in second is applied materials put in a respectable 72% in gains. and micron rounding out top three. on the flip side biggest losers of the year are two different classes, liberty globals, latin american and caribbean at the top. trip adviser under performing after missing earnings estimates a few times. and vertext has had a few pipeline disappointments this year. when it comes to fangs the best performer is amazon. it beats facebook and alphabet or google as we used to know it is a lagger so far this year. final day, happy new year. back to you.

>> happy new year. the market finishing in the chips as it were. pretty obvious. exchange funds enjoyed record net inflows. $283 billion. >> the appetite is going to increase more in 2017. he joins us for our final "closing bell" exchange of the year along with peter costa and our own rick santelli from the cme in chicago. tom, what is the story of the year for etfs for you? >> almost $300 billion in etfs. 50 billion in the top three etfs all s&p 500. so the appetite is there. 74% of advisers just told us two weeks ago that they plan on adding more money into etfs as we go into next year fuelling bull market and stocks and bonds. if there is a correction there

are alternatives out there hedging on currency and hedging on higher interest rates and also diversification to multi strategies. etfs has a little bit for everybody next year. >> peter costa, we have talked last several times we have spoken to you about how you got out of the market here. do you anticipate getting back in in 2017? >> i think what i'm looking for is the after the first couple of weeks of trading next year and seeing how the earnings start coming in. i think like i have said before that i think a lot of stocks all got ahead of themselves. i think there will be a correction to bring them back to some sort of normalization in pricing. once it gets back there i will be back in the market. i'm not out of this. i think next year will be a good year. i'm just looking for the opportunity get back in. >> you don't have a price

target. you will know it when you see it. >> obviously, that is the way i trade. when i see it i know it is the right thing to do. thankfully i have been very fortunate. >> or when your sister sees it. >> when that phone rings i pick it up. >> and we have been talking about huge moves in stocks and moves in bonds and the dollar and some of the commodities like silver it seems everywhere you look there has been is it a repricing or repositioning? >> there have been big moves. you know what i like to say, the roller coaster is fun. you realize that the 30-year bond is only up a whopping four basis points on the year. close to 3.02 and currently at 3.06. fives and tens are tied with the most change. 16 basis points for fives and 17 for tens. so the whopper move is because

we continually think about the extremes we made in 2012 and, of course, this year in tens, for example in the mid 130s. same can be said for the dollar index. it is up way more off the lows. those aren't significant but will be significant for 2017. i think one of the areas i really want to draw people's attention to thunderstorm one yield close above three percent since mid 2011. that was the last day of the year in 2013. so exactly three years ago we had a close at 3.03. that was it. that 3.03 level will be hyperimportant for 2017. i think the biggest market to pay attention to for next year is the bund market. they close down for the year. think about the negative securities that entities own and they own for one reason because

they think other entities are dumb enough to buy it from them. mario draghi can keep that gain going but 2017 he will start to run out of run way. >> i know we ask you a lot about u.s. stocks but rick points out some of what has been going on in europe. japan is turning in five straight years of gains first time since '89. what does that tell you about the kind of environment that we are in? >> i think the risk has been coming out of europe and into the u.s. that has been continuing. it started probably in march of this year. so if you look at the charts you will see that there has been movement from europe, risk off there and risk on here. i think you will start seeing risk go on in europe next year. i'm not sure how much. i think there will be movement there. >> for the etf trends, tom, how many more etfs can this market absorb? the industry has done a

masterful job of creating new etfs as a trend presents itself. where are we and how long before we start to talk about a bubble building in the etf market? >> there are almost 2,000 etfs. we introduced almost 275 this year. but they actually closed about 150. so there is kind of a natural progression here if they don't -- you throw a lot against the wall not everything sticks. so there are companies that are going to have to close etfs. i think the key thing is trends do develop and latch in on what peter was saying, if overseas markets continue to advance there are a lot of etfs that represent that. if we continue to see rising dollar there is going to be a lot more discussion about currency edge, foreign equity etf strategies. i think we will see a big trend in that area in 2017. >> you raise an issue that there is some disagreement.

we had rick edelman tell us he didn't think people would get near the products, that they are way too risky and not clear what is in them. they are expensive too. is that the best strategy for people wanting to take that currency impact out of the trade in. >> it is very inexpensive to put on a currency hedge compared to mutual funds. if europe goes up by ten percent and the euro declines compared to the dollar by ten percent you lose all your gain. we have not been in a situation for a long period of time where the dollar has been advancing on a meaningful basis. it is an asset class that investors need to be considering. within etfs the amount of money that you pay for that hedge is really small from the comperative standpoint. >> i guess i'm saying if it turns out the way the funds are making the trade is risky and people are exposed to some sort of risk they are not fully aware of, it can blow up in their

face. >> you are using futures which have been used for decades. it is just like any people are using them on the market place. if you buy a foreign mutual fund or foreign etf within that foreign currency you are betting on that currency. at least a 50/50 bet. >> got to go at this point. appreciate all your comments. happy new year we will see you next year. >> happy new year. 45 minutes to go in the final trading session of the year. michael santoli was pointing out the last 15 minutes are not always great. the trend has been worse. we already know there is selling pressure on the bell and a number of reasons we see the stocks move especially lower. >> the last few minutes we saw a huge sell off and then it started. it just continued. remember the first part of last year the first month or so was one of the worst first months we had seen in quite a while. >> in decades. watching the markets close.

dow is down 75 off of session lows. s&p down 12. naz down 52. we are going live to moscow where president putin is defining a recommendation from his own foreign minister to retaliate against u.s. hacking sanctions. and we speak about how the latest tensions can play out especially when donald trump takes off. as wall street gets ready to bid farewell to 2016 two investors tell us what they made the most money on this year. you're watching cnbc, first in business worldwide. ♪ w' drwhere, in all of tis stuff? thstakes are so high, yyour future. hodo you s this? thstakes are so high, u don't.uture. you partner with a firm that hadses gornments

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russian president vladimir putin issuing a surprising response to u.s. election hacking sanctions. >> our story from moscow. >> reporter: traditionally historically when one country expels the diplomats of another the other follows suit. that is what happened with the u.s. and russia in 2001. that was the expectation this time around. the russian foreign minister said as much. he said he recommended to the kremlin that russia retaliate.

president putin coming out completely stunning both the american press corps and the world by effectively declining to retaliate. he said in a statement we're not about to stoop to the level of quote irresponsible diplomacy and will take future steps to restore future russian-american relations. he is awaiting president-elect donald trump to take office. the attitude here statements have been not that russia hacked the election. the kremlin has been denying that but that the obama administration on its way out is attacking russia, blaming russia for internal problems and trying to further undermine u.s.-russia ties. what president putin achieves by declining to retaliate is a smart move domestically. he looks like he is above the fray and that is winning approval from people on the

street. and it also effectively throws the ball in donald trump's court. he believes that relations will be better under donald trump and that is what the russian country is waiting for. >> thank you. let's talk more about u.s.-russia relations. >> joining us larry mcdonald, creator of bear traps report. and also joining us is thomas pickering, former u.s. ambassador to russia and several other countries during his four-decade career as a diplomat. ambassador pickering, there has been no love lost between barack obama and vladimir putin. what do you expect to happen when donald trump takes office? do we do a 180 in the relationship? what do you expect to happen? >> i think asking me to predict what president-elect trump is going to do is a little hard partly because he himself has said he isn't going to tell us. he has reached out to president

putin and president putin in return has reached out to president-elect trump. so this could be the beginning of perhaps a slightly different set of relationships than we have had. i don't in any way blame president obama and i think he did what he had to do in order to send the signal and hopefully deter more fooling around if you can call it that way in cyber attacks or cyber misuse to influence u.s. elections and perhaps other elements of u.s. internal politics. i would expect that the president-elect himself one way or another ought to be concerned about that. he says he wants to put it behind him. at the same time it's still there and we have taken a step and it is an important step. >> since you have just returned from russia, if you could tell us a little bit about the atmosphere there. i don't know if you got a sense from the way this issue was presented on tv or the people you spoke with, how do they

perceive what happened between u.s. and russia? >> i was in russia months ago and i think we were all concerned looking at russia that there continued to be this sort of steady drum beat of anti-americanism. i think in part obviously to reinforce the notion that president putin has obviously put abroad that he is leading a serious effort on his part to move back in to a center of importance in international affairs and he is using a good anti-american line as a way to strengthen his position at home. >> same question to larry mcdonald. >> i was there maybe two weeks ago and the people across everyone i met over the week were extremely excited about president trump. i met a few people in particular that incomes are down 70% over

the last two years personally for the two people. really wonderful people that i met over there and they have been really hurt by the sanctions. if you look at the equities in russia they are up 40% on the year. wall street now about eight different firms are bullish on russia equities heading into 2017. so it's definitely a lot of good things have been priced into russian equities over the last month and a half. >> the question i guess becomes what is at stake for investors and the international community? they have talked about how in france he might move closer to russia. how are investors supposed to navigate this period? >> the feeling i got in moscow is that the relationship between nato, saudi arabia and the u.s., that alliance is breaking somewhat. and the new alliance over the next five years could be more

u.s.-russia friendly, less so to saudi arabia. so these kind of tectonic plates are shifting. and the opportunities are really very interesting for russian equities because you have a lot of -- they are cheap trading at six and seven times earnings. >> ambassador pickering, do you trust vladimir putin? >> i don't, but i think that we have to deal with the people who are on the other side regardless of whether we have a lot of trust in them or not sp and watch what they do as well as what they say. we are very much in that mode in the united states. there are a lot of people including a large number of members of president-elect trump's party that have their own reservations and more have been supportive of the sanctions that have been put on even if they call them last minute.

>> well, it's going to be interesting to see how the relationship evolves during a trump administration. thank you both. happy new year. >> thank you. >> thank you very much. 38 minutes left in the trading session here. dow is down 61 points as we head towards the close. no dow 20,000 this year. up next we are going to run through stocks mabing gains on this final trading day of the year and it is only about -- there is a lot of red on that screen. three to ten advancers versus decliners. shark tank's kevin o'leary will speak of whether he sees it taking off in 2017. still to come. yourupporteam yourupporteam r waing me throu my fst options tra. nly doeverne gary. yourupporteam r waing me throu well, feeltty smart.ons tra. wellwe're all about educatin peopwell, don't woes. won't t th accomplisent go tea m ill the old gar

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keeping an eye on markets dow down 63 points but we had big sell orders on the bell. >> sounds like they started to pair off. we got word from mr. cashen. >> declines better on the nasdaq. s&p down nearly half a percent. a couple of individual movers like mylan which is rising. the company launching generic version of two drugs one to treat adhd and the other to prevent pregnancies. and then kate spade which is higher again today. that stock up more than 30% this week alone on those reports that the high end hand bag and accessories maker could kick off

a formal auction process to sell itself perhaps as early as next month. kate spade and company declined comment on the reports. this has been based on reports outside the company. it has a market value of about $2.4 billion right now. up another 2% today. >> the question is does it go with a coach or somebody like that or part of a larger retail company. it is what is left of the former liz claiborne company. >> i did not know that. >> always check that. how about we go to the close. much more to come here in the last half hour of trading with the dow down. the leading trader. you will want to hear from this guy, art cashin is coming up to give us his take on the close as we head towards the final 30 minutes of trading for this year. two mainstream investors give us their take on the trump rally and how long they think it can last. stay with us.

welcome back. about 30 minutes to go. at 3:33.33 it might get rowdy. it moved off the lows considerably.

real estate one of the gainers. how about kimco realty. we are talking about gains of one to two percent. >> nobody is louder than art cashin. a day of traditions. there are great traditions that i love on wall street. >> the bagpipe player cape in and finish it off with whoop, whoop. >> what is going on right now? we saw a lot of selling pressure early on. >> at one point it appeared there might be $2 billion for sale. that set in with all concerns about pension funds selling out for end of year. that has dissipated. we are pretty well paired off now. we come from minus 100 to minus 50. >> traditions, the beginning of

a new year, theoretically new money comes in and sometimes we get a pretty powerful rally. last year, beginning of this year was very different when you saw a powerful sell off. >> i think we will see a lot of volatility. i think people are going to hold back. people were talking about the payrolls end of week. the feds aren't going to do anything. they want to see what the new administration is going to propose, how likely they are to get it done early. i think we will have ups and downs and start the weekend to see if the president-elect gets a lot of pushback about his tweet about mr. putin and where things are going. >> in other words, the market is data dependent. >> and in this case it is politico dependent. >> we always appreciate your contributions. >> happy new year. >> absolutely. great art cashin. >> time for a cnbc news update with contessa brewer. >> here is your news update.

iraq is seeing another wave of intense fighting. special forces are pushing back isis militants. dozens have been injured. scores of people have fled their homes. iraqi forces ended a two-week lull to stage a multi pronged offensive. india warning there is an immediate threat of attack to western and tourist targets. it says new year's eve beat and club parties are the most vulnerable. maine's largest utility says it will take days. new england got buried in this nor'easter. the worst is over and net temperatures are expected to dip into the 20s and may be tough if you don't have power. looks like a shopping mall in china has a new mascot. a giant rooster has trump features. it is to commemorate the lunar new year of the rooster.

if that is not enough to get you to whoop whoop that is the cnbc news update. >> if you missed it by five seconds. it was a pretty good one. >> i got to say. >> thanks, contessa. >> i will see you later. >> you got to hurry. >> i will be there i hope on time. so not only is it the last trading day of the month but of the year and it is time to check in with how main street views this market as 2016 comes to a close. >> joining us for retail investor round table engineer wayne smalls along with college student who is here at post nine with us from the university of south carolina. welcome, guys. wayne, first to you. you have outlined a number of picks. what do you think were some of your best ones? >> i'm absolutely happy with nxpi especially after the recent buy out by quaalcomm and the

upside is right around 30% mainly because that was a leverage buy. i'm also happy with the performance of s&p 500 as it relates to my tsp fund. because i am an averaging investor i saw a return of roughly 20% compared to s&p 500's 8.5% over the year. >> you are not a dollar cost averaging kind of an investor. you are more of a trader type. you have had a pretty good year here. >> my biggest news i look for long term value. i kind of learned to go into everything so i have traded options at times and done swing trades. so i kind of focussed on a little bit of everything. >> your big winners would be what? >> fanny and freddie and seeing some stuff come out about trying to get this conservativeship figured out and we are seeing

uptake. secretary mnuchin wants to release the companies. there is a way to do it in my opinion the most important issue right now facing every person in the country. it has been going on for eight years. it is time to -- and i think we will see momentum and possibly remove them, sell them back to the private sector like they should. the government can reap huge benefits. shareholders, everyone makes it happen. >> hold those into 2017. >> what about some misses or ones that you might have missed? are they on your list for next year? >> well, one of my misses -- not really a miss, i didn't get in on it when i should have, i had the opportunity to buy etf for transport earlier this year around end of february. sure enough it made significant upside. i was tlnt to participate. >> what is worse, buying a loser or not buying a winning?

which is worse for you? >> it's definitely buying a loser. when you do your taxes later and you look at what you did and the damage it's like a bad feeling. >> speaking of that, are you doing anything tax strategy wise with incoming president for next year that will be different? >> well, i'm hoping that we see a tax reduction in capital gains for stock owners. that is something we all share if you buy stocks. i'm holding and excited with other holders. >> your winners aside you think overall this market is overblown and overbought? >> i think we have -- are you doing something to hedge yourself in the meantime? >> not really. i have some parts and holdings i have to keep safe in case we see a down turn which could be possible with tax celling once we get to the new year. i am very cautious.

in about 23 minutes it will be positive returns. the longest investor is nine years. i think -- >> you bring that up as we have been also seeing headlines on another kind of related issue. a lot do not have money in the stock market. if we have a 401 k it tends oo be conservative for the age. why should i get more into stocks now and they have been on this run. what are you seeing when you are talking to people who might be our own age about whether now makes sense as the time to be in stocks? >> that is a great question. at the end of the day you want to put your money into the markets because it is the best way to grow yourself into a retirement and i feel i would be careful going into it after eight years of having straight positive returns. you want to be in the market but at the same time you are the huge stretch of bull market you are most likely going to see a down turn. you try to take advantage of when you see a correction or a

big pullback when you want to go more into the market. i would never advise it. >> they missed out on the meantime. >> got a long way to go. we are all in our young 20s. >> not all of us are. thank you guys. we do love the retail round table. we get to meet smart guys like you. we wish you continued success into the new year. >> happy new year. >> thanks. 20 minutes to go. dow is down about 66 and now sitting around the levels with a drop to close out the year. half percent decline to s&p and russell. nasdaq down a little less than one percent. ships and trains and how to make money in those stocks in 2017. oil versus gold. which commodity is clocking gains and the risk factors they can face in the year to come.

18 minutes left. the dow down 78 points but closing on a pretty good year. we have already itemized how well. >> russell 2000 is up nearly 20% this year. that is unbelievable. >> even the dow at 13% gain when you consider the deep hole it dug for itself the beginning of the year.

we were down sharply until when? when jamie dimon said he was buying his own company's stock and the market took off after that. we owe all of this to jamie dimon this year. tech is lagging today. nvidia, sky work solutions, broad com. let's broaden that out. nvidia has been the biggest gainer of all stocks this year up 220%. >> huge gains below the surface here that we are about to put into the books. we are in the final minutes of trade frg 2016. let's open the trade book. predictions for the transportation sector. >> reporter: what a difference a year makes transport stocks rocketed to record highs in 2016. that ride could continue next

year as freight demand picks up. first rails will recover after nearly two-year route volumes will finally begin to get back on track. put up more rigs. and shippers move more containers from trucks to trains. package wars will be waged as e commerce surges ups and fed ex will face more competition. xpo logistics will become a household name and transport imports, dhl and tfi will double down on america. the wildcard, amazon which will keep building the network as the industry remains in denial. lastly, high tech trucks will hit the street. by year's end 3 million drivers use devices that log hours and location of every vehicle. expect to see self driving big rigs on the road as more states launch programs to test the technology.

cnbc business news. >> meantime commodities locked in handsome gains. jackie wraps up the year that was and looks at risk factors for the year ahead and stuck around to do this for us live. >> good afternoon. great to see you. commodities seeing a lot of volatility this year but managing to weather that storm as a group ending 2016 mostly higher. now, crude oil had the largest yearly gain since 2009 up about 45% year to date after getting dangerously close to $26 a barrel back in february. while many feel that crude's upside is limited in 2017 they still don't think it will test extreme lows as it did this year. gold, another one all over the charts from 1059 now sitting over 1150 finishing with almost 10% gain but first positive year in four and its best since 2011. sticking with metals, copper from 215 up to 2.70 before

giving some of that back. looking at copper, of course, as global growth indicator because of industrial uses. people tend to think it gives a sense of what the economy will do. the biggest loser and brian sullivan made fun of me for bringing it up. one of the only losers out there. it was cocoa down more than 30% year to date. its worst year since 1999. a large part of the decline coming in the fourth quarter was a simple supply and demand story. the cha bill griffith, a lot of that probably happened in your house at christmas time. >> we don't make fun of anybody here. this is one of kelly's favorite stories. >> i love the juxtaposition of how poorly cocoa was done. >> they don't necessarily have to do with the economy. they have to do with mother

nature. we can't product what the weather will do. i separate them out as a group. across the board commodities did very well this year. >> yes, they did. thank you. >> happy new year. >> and to you, too. see you later. 15 minutes to go in the session. dow is down 80. s&p is down 13. vix is up a point and high flying small caps down half a percent. here we are at the end of the year. the market acronym of the week is also his outlook for 2017. what can it be? ♪ youe into wissh ae xucemb to rememberal eve get t$2500 stom cash on select 2016 an2017 dels for tseerms.

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ten minutes to go in the trading session here and surprise market on close orders from art cashin just now to the sell side big $1.2 billion to sell. that is the imbalance going into the close. >> we have had a lot of action. moving all over the map. now the dow is down 90 points. we have minutes to the close. let's look at top stories. stocks move lower after donald trump saying great move on delay by putin.

apple dipped lower after reporting it can slash by 10% in the first quarter of 2017. that has the tech sector as one of the biggest laggers today down about one percent. here we go. one more time joining us on the floor of the new york stock exchange our friend the independent investment consultant. how are you? >> i want to wish everybody especially you and kelly and all of cnbc colleagues and collaborators a very bright and happy new year. >> we return it to you. that would be a good acronym. >> comes from the old english word bright. a bright start to the new year, banks have had a pause. you pointed out they are up about 20% on the year. all of that is since the election. the fact that they are pausing here is actually a good thing. i do expect them to move higher as interest rates move higher.

r is the resurgence in consumer confidence. we have had a 12-year high in the consumer sentiment number from michigan and a 15-year high in the consumer confidence number. way up in the 113.7. that is off the radio dial. remember last time? i is interest rate. they are going to follow inflation. forget deficits. forget foreign demand. interest rates follow inflation and inflation as oil lapse the old number will tick up and that will put upward pressure on interest rates. the g is geopolitical and global factors. that is geopolitics and could be something like what went down on the cyber hacking and everything. also foreign exchange. the dollar eased off. that is a good thing. you don't want it to be too strong. the h unlike banks which are a

homogenous group, health care is a heterogenous group. medical supplies, devices, farma and bio tech move differently. the fish don't swim at the same rate as they do with banks. it is still early to go fishing for health care. on trump, he owns a lot of golf courses. and the market basically is expecting him to get a birdie on three and not to bogey the other three. the birdie on three is infrastructure, lower regulation and lower taxes. those are the ones that the market is expecting. they are not expecting any bogeys which is foreign policy, immigration and the fast one is tariff and trade. >> we have bonus coverage on that last one there. >> and 2017 is going to be a great year and it will be a great year for you, kelly. >> and for you.

>> and for your family. >> she is going to shut you down on that one. looking forward to a big year. all of us are. >> i was about to ask what a bogey is. >> i'll explain later. we will take a quick break and get to the closing count down. this ought to be a very interesting close. coming up after the bell january isn't just a new year in 2017 after months of protests marks the increase in minimum wage in 19 states. we will have a look at impact that will have on business and the economy. you're watching cnbc first in bogeys world wide. eair worth? (cheers) what's iworth talk to ur mom? what the value of lk in the woods? e valu tal iso crea

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signp p eade.m d get up to six hundred dollars. whe invests can n vestig d instn vests... about three minutes left as we head towards the close. last day of trading. why am i holding this microphone? who gets the best dressed award again on new year's eve eve? are you busy? you are busy, aren't you? he can be busy but we will show him anyway. there you go. got the whole outfit going. sort of a nathan detroit meets the ridler from batman. tara wants to see the pants closer. there we go. let's go. we have to show the folks what the markets did this year. the dow even with the huge hole

we started crawling into at the beginning of the year we finished with a decent gain of about 13% for the year. the best and worst performers caterpillar was best performer this year and nike was the worst performer. for the record i asked kelly evans before the show started today about those. she guessed them correctly. you're welcome, kelly. the ten year yield for a time fell below 1.4% but as your rick santelli pointed out earlier we are finishing with a gain of about 17 basis points for the year. very volatile year for interest rates along the treasury yield curb. the dollar index a stellar year and the expectations is that will continue into the new year. the strengthening of the dollar especially as the fed continued to raise interest rates in 2017. good year despite the gains for the dollar good year for oil, as well. wti up 45%, the best gain since

2009. and gold even with this huge decline we saw is going to finish positive for the year but not by much. we finish the year at 1151 on the price of the precious medal. >> we are ending the quarter with financial stocks. only three financials up today. goldman today and good to see jp morgan and travelers. only three stocks and they had been slipping. a little stability in the financials is a good thing. remember with the overall markets right now we are 1% from the historic high and the advance decline line still positive. in other words, there is still more advancing stocks than declining stocks so everybody says we make dow 20,000. i am disappointed, too, but the markets are in great shape. >> another great year. 25 years bill and i have been together. >> keep doing it until we get it

right. happy new year. >> the cast of cagney ringing the bell. a lot of pairing off went on with those sells. no dow 20,000. wait until next year. stay tuned for the second hour of "closing bell" with kelly evans and company. happy new year. thank you, bill. welcome to "closing bell." i'm kelly evans. it is hard to believe it is the last trading day of 2016. what a year it has been. it's not dow 20,000 this year. if it happens it will be next year or beyond. the dow closing at about 19,770 with a trop of a quarter percent on the close. the s&p 500, the broad market and the small cap russell 2000 down about half a percent.

2,239. nasdaq down having a rough session today to close the year at 5,383. as you can see the best gain for the dow on percentage basis since 2013, stocks have been on quite a run here with much of it coming just since the election on november 8. we will have much more on this in just a moment. vladimir putin saying russia will wait for president-elect trump to take office before retaliating against the newest u.s. sanctions. we will bring you the latest on that story coming up. today we have cnbc senior markets commentator and pro columnist michael santoli. cnbc fast money trader and kevin o'leary who just launched a new etf today focussed on high quality small cap and low volatility dividend paying companies. that's a mouthful, kevin. welcome, everybody. mike, tell us what you think about the markets as we close out the year. >> obviously, kind of finishing with a wimper. very quilt. i think the story for the year is definitely just the market's

resilien resilience becoming battle tested. i do think that the way we finish the year does reflect to some degree people feeling as if we have come a long way in a short period of time even though we were flat for two years and the muscle memory of january, are we in for something a little more turbulent? you see the vix inching above 14. people bracing perhaps for a little bit of a storm. >> other mike, do you agree? >> well, i think it is interesting. a lot of investors right now are facing very long time bull market and they are worried that it might be a little bit stretched here. valuations obviously a little bit elevated. that optimism might be justifying some of that. that might spell maybe 10% bater earnings for the s&p.

>> kevin o'leary as you look back on the year we were talking about the popularity of etfs and you have included dividend ones. are you worried about next year with the way rates are going? >> no. i'm not. i'm really focussed now on quality of balance sheets because i am going to make an assumption about this market that it is in a unique situation. we are not going to trade in the new year on q 4 earnings. we are going to trade on the pace at which trump can ram through changes on regulation, on energy deregulation and on changes to corporate and personal taxes. and if any of that gets slowed down it won't matter what the earnings of q 4 were. you are going to see a major correction sector by sector. if it is not clear we are getting deregulation on banks those regional banks are coming back down. >> and we just showed some of your 2017 forecast which include you think financials and energy, some of the stellar performers

of this year will under perform next year. is that right? >> i do because i'm a believer that are of the optimism -- i love to have the animal spirits behind me and i think it is great. the idea that we are going to get through this regulation in a matter of a couple of quarters is fantasy. when reality strikes and you realize to a certain extent it is politics as usual it is going to take time thrks bloom will be off the rose because the balance sheet quality of regional banks and other banks and financial institutions and the balance sheets of energy companies are really bad. and i think at the end of the day at some point gravity is going to strike. i have seen this happen before. i don't want to be heavy in those names. >> let me give everybody a run down of what we are talking about in terms of performances. we will do it by etfs. one of the best performers the gold miners.

semis about 30%. then speaking of banks the regional banks, kbe up about 30% to 32% this year. the xle which is big energy etf up about 30%. and iwn up 30%. it is a value play in the russell which was up about 20%. we are talking about huge moves. >> what this reflects and semi conducters might be the exception when looking at top performers for the year but they had stealth bear markets. small cap stocks, energy, financials were neglected and industrials were in that position. you had the big snap back as recession fears were not realized. >> if you are wondering the worst performers include ibb down about 21%. the home builders are slightly negative for the first time since 2011. maybe bob can tell us why

williams sonoma are in home builder etf. >> overall the companies that have some kind of improvement or some kind of working area in home building area in general, anything having to do with home improvement there is a pure play way to play. >> it is more -- >> you are here to talk about ipos which slowed down a lot this year. >> i want to talk about 2017. there are reasons to be optimistic about ipos in 2017. markets are at historic highs. there is a business friendly administration in the white house and congress and there is hope for less regulation and lower taxes all very important for ipos. what sectors might do well in 2017? only two energy ipos but with oil stabilizing many shale based companies that could be profitable might go public and then the biggest ipo of all time, a potential trillion dollar listing.

also hope for small banks. lower taxes, less regulation will improve valuation of those companies. as for tech unicorns i say it is a wildcard. the big question is whether they can invest to pay high prices. that is the big ipo head wind. ipo investors have shown little willingness to give ipos obreak on critical valuation and many companies have been private for so many years they are already past the early growth stages where the most money is made. much rapid growth already behind them. other sectors may suffer from policy uncertainty. nobody knows how much of obama care will be repealed. a number of ipos were small. good news because most who went public did well up an average 26% because they put pressure to keep prices down.

stingy buyers in 2016. we care about the investors and not the issuers. the issuers weren't happy. >> if it was up 100% that is not necessarily the best news for the investing public at large as much as those hanging on to shares at the get go. >> when you look at the list and i will put you on the spot here. i wonder can you name like more than two or three of the top performing ipos? >> the answer to that question would be no. as far as bob was talking about with respect to high valuation private company yz have a hard time believing that the public markets are interested. the issue could potentially be a big money suck out of the markets. that is obviously a big thing. i look at the coming year and think about what we should be concerned about. i think about names like

caterpillar. kevin eluded to the fact that we don't know whether everything trump said is going to become reality. everything he said and much, much more. this is a company with 40% decline is trading 15% off peak valuation. >> the company said they thought the share price might have gotten ahead. i don't think many people have heard of these companies that had gone public and doubled their money this year. the best performers, accacia, michael santoli, we have -- they have hardly been topics of discussion. >> i think what you are seeing is this bull market has gone on for a long enough time. a lot of private equity owned companies got out there. you have a handful of unicorns that don't want to come public and waiting out there. and the rest of them private

market valuation and active m&a. we have this cash. big companies brought buying fast growing private companies means fewer ipos. >> the only thing about valuations, what gets hurt a lot? small companies. those are ipo types. what gets hurt paying more taxes than their fair share? small companies. if we can push through changes that we are talking about you can make an argument that companies going public deserve higher valuations. in other words, the public valuations should be higher and closer to the private valuations. they are making this argument already that the trump rally may help the ipo market. >> in the journal calling for sarbanes oxley act to not be fully repealed. kevin, to the point bob was making do you have a point of

view about the way startups are transitioning or not to become public companies these days? >> there are three ipos that i'm watching and they are all coming 2016. two of them are domestic and one international. we referenced all of them. the one i'm most intrigued about is uber. company is not profitable. forecast cash flows are way late. that is a huge valuation. billions of dollars put in in private valuations close to the top. that is going to be the test. that is such a huge ipo so long in the tooth. if that one fails or doesn't come to market it is going to put a lot of pressure on a lot of tech. i think that's the test. also snap chat is really intriguing me because is that the next facebook? what sth saudis will do is be the biggest vacuum cleaner the world has ever seen for free cash. i will be participating in that one. that is going to be a global ipo to the lowest cost producer of

oil that ever existed on the planet. i want to own some of that. >> would you want to own uber? >> no. i think uber is going to be extremely painful for those that went in at a valuation north of 50 billion. the problem with this market that i don't think anybody thought through and i'm concerned about it is if apple got into this business and said i have a fleet of 1,000 cars outside of boston and the only way to access them is to use an app on apple it doesn't give a damn about uber. it is not that proprietary to provide a ride sharing service. i think that hasn't been thought through. if it is true teslas are building the vehicles and that is going to be a big disappointment for uber investors and very painful. >> i would be very surprise if uber went public in 2017 with the kind of numbers they are putting up right now.

>> unless they start to put up better ones. we have to go. kevin, thank you. mike, if you have the big uber fund which would you invest in? >> uber is valued close to what facebook was a year before their ipo and they are not putting up the kind of numbers and don't have the same kind of business promise. much more coming up on fast money. you can catch mike and the rest of the crew. don't miss it. it is at 5:00 p.m. eastern. >> happy new year. we will see you in like three days. russian diplomats forced to leave compounds a short while ago as part of sanctions imposed by president obama for cyber attacks. more developments on capitol hill and from president-elect trump. we will have the latest next. 20% millennials are investing enough in the stock market. what will it take to get them in

and raise their risk appetite? that is ahead. you're watching cnbc, first in business worldwide.

welcome back. president-elect trump and senator john mccain speaking out and taking action on president obama's executive order for new sanctions against russia in the wake of vladimir putin's surprising response. john harwood has the latest. >> extraordinary development in the last hour. president-elect donald trump disregarding not only the tradition of one president at a time by staying out of foreign policy issues but siding with a foreign leader vladimir putin a day after the current president sanctioned him for what the intelligence community says was interferen interference. donald trump sending a tweet saying president putin's decision not to retaliate was a great move, the delay was a great move and i always knew he was very smart. this came as russian diplomats were leaving the compounds first of all on maryland eastern shore

where russians have maintained that compound for the last quarter century. then also the compound on long island that had a similar purpose. you had a separate press conference staged at the san francisco russian consulate in which a russian official noted in a bit of crude pr to try to get american sympathy that one of the people booted out of the country had been the chef which meant consular officials were not going a have cooking for their new year's eve party. this was pr with the same level of nuance as vladimir putin inviting children of diplomats to the kremlin. the challenge is that republican officials on the hill don't feel the same way about vladimir putin as president-elect trump does. john mccain, senate arms services chairman saying the arms services committee will

hold a hearing with intelligence officials. this is the same intelligence that donald trump will get briefed on next week. he faces a potential clash with those republican officials if he continues to praise putin and disregard the work of the intelligence officials. a fascinating couple of weeks before he takes office. >> already is. should you be investing in russia right now? founder of lead -- one of the best performing in the world currency has depreciated. how does this shake itself out next year with all of what has happened? >> i don't think the current sanctions will make much difference. they were fair hae mild which is one reason that putin is ignoring them. what is driving russia is oil primarily and that is up a lot. also earnings growth. russian companies are really stepping up their game.

people meet with them and they are kind of amazed at the improvements. it used to be i would go for a day of meetings with russian companies. eight of them were weird and two of them were pretty good. now it is the opposite. so that's a major change i have seen in my 20 years in investing in russia. >> let me ask you about the economy. they can only do so well when the broader economy has been in recession for i don't know how many years now. we read stories about how much the incomes of people have been destroyed. so where is this improvement coming from? >> the worst is over. the real incomes bottoms out the middle of this year and started growing again. and we are now forecasting about 1% gdp growth next year. so they have somehow managed -- they handle the macro so well.

they took all of the pain very quickly. brazil which has been struggling along russia took all the pain in 2014-2015. consumers are starting to spend again. consumer confidence has grown. they are pretty well set up for next year if oil stays above $50. obviously, if oil sinks down and it should because of the opec cuts, oil demand growth continues to be very strong around the world. of course, there is always that risk with russia that a big drop in the oil price looks different. >> harvey, in your contacts with business people in russia, people running companies is there any sense you have been able to pick up that they are hopeful perhaps of having a better environment for themselves given the friendliness of president-elect donald trump towards putin and russia in general? >> sure. i mean, absolutely people feel

that they are being understood better. the president has broad foreign policy powers. people should not under estimate trump's ability to do what he wants when it comes to russia including rolling back these exact sanctions as soon as he becomes president. so people there are more optimistic about it. honestly geopolitics has never really been the center of this market. it tends to be about oil earnings and things like that, not so much -- you don't hear russian market people talking about politics very much. >> we know they will be talking about oil and that will be the place to watch as we continue to see how the stocks there do. thank you for joining us. more than 4 million american workers are set to get a raise at the start of next year which is in a day or two.

the economic impact of raising the minimum wage is next. and then there are smart phones, smart watches and smart tvs and the smart home. we will take you inside a high tech house coming up. just the check. alhe. i can't reach it. if you h, you d pi the c cck. i can't rat?h it. if you h, you d'shayodo.t this thanks, dennis! ouant to sav fiftor more arnsur you swito geico. ouagrowwwlpv fiftor more it'shat yo. oh that is gd .

19 states will increase the minimum wage at the start of the year. >> for wage advocates 2016 really was a banner year with millions of workers in 19 states

and nearly two dozen cities and counties ringing in the new year with a raise kicking on either december 31 on january 1. these 29 states and washington, d.c. have wages above the federal of $4.75 an hour. many are significant. for example, workers in arizona will get a raise of 24% from $8.05 to $10 an hour while workers in washington state and massachusetts will have the highest minimum wages in the country at $11 an hour. the national employment law project said this is the most successful year for the fight for 15 since the movement launched some four years ago. major mile stones included new york state and california and washington, d.c. following suit by the year 2020. but both critics and supporters agree there is likely little movement at the federal level with donald trump in office. trump spoke out in support of the $10 an hour federal minimum wage while campaigning.

labor secretary nominee and republicans in control of congress increase seems near impossible. back to you. >> thank you. i think it goes up to $11 here in new york city. it will be interesting to see the impact on all of that. happy new year. thnchlths dow not hitting that 20,000 mark yet but still up 8% since the election. there are lots of young people who should be investing in stocks but they are missing out on those gains. is it too late for them to get in? that's next. and know t orwo about tding. a trademarked tdee atform thaale...ra won't. and know t get ofe compraor!ding. (cann soun mobili is very a's whi e trbitot. and know t get ofe compraor!ding. it's a mmobile deves, sosuits mobilfeste mobili is very a's whi e trbitot. and it k my instntsfullbile.. get ofe compraor!ding. evenhen i'm onhe mov

welcome back. today wall street includes the month and the year. the dow closing at 19,762. quite a distance away from 20,000. last tuesday to close at 19,985. we have since receded. about a 57 point drop for the blue chips. the s&p down ten. the russell down six and nasdaq down nearly 50 points. time for a cnbc news update with contessa brewer. >> a rehearsal for the ball at times square before the big night and the ball test went off without a hitch. police, of course, are ramping up security in the area for new year's with special barriers and

garbage trucks fill would tons of sand to prevent truck attacks. police across europe are increasing security. authorities in germany are erecting concrete barriers and stepping up surveillance measures coming following last week's deadly truck attack at a berlin christmas market. snack company mikesells is recalling bags of nacho cheese tortilla chips. the bags were distributed in ohio, kentucky, indiana, michigan and illinois. >> baby panda twins are getting accustomed to new surroundings. the girl and her brother were born in august but, of course, it take as while to make your public debut so there they are in all their glory. that is the final gift of 2016 from me to you. baby pandas. >> couldn't have picked better. they are trying to bring them to central potentially.

>> let them frolic around? >> i would support that idea. i think in the central park zoo which current attraction is bobcat. >> pandas would be an improvement. >> i expect mike to be expert on all things new york. >> snow leopards. >> love those pandas. thank you, contessa. 20 as in 20,000, big number for the dow this year that came up short. there is another 20 number not getting as much attention. a recent study saying 21% of millennials are invested in the stock market. that demographic pays little or no attention to retirement or investing. we wanted to see how financial advisers respond. we are joined by kathie curtis from curtis financial planning. also with us is charlie kirk, a millennial, like a rare spotting in the wild who invests his own

money in the market and founder of youth organization turning point usa. welcome to both of you. first to you, kathie. how much of a problem do you think this is? >> well, i think a problem is that millennials like to have fun. they are young. it's very expensive to live in urban areas. they don't have a lot of money left over tainvest. they are paying $3,000 to $4,000 a month rent in some cases. it is a matter of getting them to adjust from short term immediate thinking to longer term thinking. and i find that millennials really want things. they look forward to a future with a big house and maybe a vacation home. if you can get them thinking that if they don't invest they are not going to reach the big goals, that's one way to do it. >> charlie, my dad has a problem with how much millennials spend on each other's weddings. going to them and having

bachelor and whatever parties for them and wearing outfits to them and all the like, do you think what kathie is saying about the spending habits is the problem here or is it that there is not a familiarity with why you should be invested in the stock market? >> i think it is a little bit of both. young people look at the stock market as an abstract concept. i would blame the lack of financial literacy not being taught in our schools to young people. i had to kind of self teach myself what the market was and how it operated and ask people who invest in the market how to be successful. at our high school we never did almost anything about financial literacy. it is important to note that young people, this generation in particular is saddled with student loan debt unlike any other generation prior. that is a financial burden that attacks their credit. it's important to note that this generation is in a very unique financial circumstance for the worse but this allows young people to invest in the market paired with a lot of young people not trusting the market

and not understanding. >> i think that is a great point. one thing i also wonder about is the way that the stock market and wall street are portrayed in pop culture in the movies. it is universally this negative representation of a part of what it is all about. am i wrong? is there any fundamental knowledge of what is really going on? >> i do think it is when they were coming of age. there were two crashes in 2000 and 2008 that tarnished wall street. i don't think there is anything unique about this generation in terms of not having that financial literacy. i don't think we had it. i think maybe more reluctant to adopt familiarity with wall street. what is interesting is talk to the robeo adviser folks who gear towards millennials and they say when they do get interested they kind of do quote the right things. it is let the asset allocation model do it for me. it is index funds and low kau.

in a way they have that start. >> as opposed to kathie some of the millennials a generation ago may have been day trading during the dot-com area. what do you think is the reason why? the survey does show they are invested in some kinds of assets but a lot of bonds or other types of things that are maybe more suitable for older clients. is that a reflection of a particular strategy on their part or what they ended up with? >> well, you know, i have read ose studies about being more conservative in their investing. what i find and the clients that come to me of that age is they are more educated than you would think and they understand things like index investing which they have heard that for years and years vanguard and that is the best way to invest low cost investing. they are quite savvy about that.

maybe it is because millennials coming to me are a little more savvy and are seeking help and a little bit more educated. my experience is a bit different than what you are talking about. >> do you think the answer is kind of getting in there? even at the middle school age to just play the kinds of games that ultimately lead to a little bit of knowledge about this isn't gambling per se and ultimately represents allocating your capital to a business to do something with it. >> i agree with that. i think the previous comment about a negative portrayal of wall street is 100% correct. the narrative spread across the country is young people are being told that there is something wrong with investing and something rigged about the system. stay away. that is wrong. i totally disagree with that. i deal with a lot of millennials and i look at sometimes very curious spending habits. i say just buy stocks of things

that you use and i guarantee over the next couple of years you will probably see yourself making money. netflix, google, amazon. those are millennial-driven products. young people can be investing in stuff that they understand instead of putting their money in sometimes more short term but maybe more satisfying but long term not really gaining income. if you want to invest and you are young and buying these products don't be afraid to buy the stocks or educate yourself about the market and how it works. >> a good way to start. thank you both. and smart phones and smart cars in 2017 may be the year of the smart home. will it make your life in your house any easier? gaga, what you gore? bad boy ia leradingk yo t tt inkokowimy tring formrever i .

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millions of homes will be a good deal smarter in 2017. how much money you save and how much easier your life becomes remains to be seen. >> for a lot of homeowners like me this was the year for smart home technology. this is my new nest thermostat. it was part of the package when i had my entire air system replaced. more companies are incorporating smart home tech to upgrade packages whether replacing the

furnace or alarm system. 80 million were delivered world wide up 64% from 2015 all according to a new report from ihs market. that is your nest, august smart door locks and big chunk of it was personal home assistants like google home and amazon's alexa. wynn announced it will install alexa in every suite. big companies are acquiring smaller tech players there by expanding and simplifying offerings. simple is everything because the real focus for 2017 will be educating the consumer and lowering the price. there will be improvements in the technology but companies will have to push consumers because so far most consumers don't ask for it. probably because they don't really understand it. >> or might be afraid of it as the case of hacking might be. >> i don't know if people -- first of all, some people feel

like they don't need it. i do think as people renovate and buy new homes it becomes natural. if you look at how much smarter your car is than it would have been ten years ago if you absorb it. >> the dash panel is so annoying. it is one thing if it is nice elegant interface. and then another thing if it is clumsy to use. >> things that you have to pay attention to that you didn't otherwise want to. >> it is smart that it can adjust the temperature for itself i get it. they used these security cameras and -- >> i was a complete skeptic that that would be a risk. >> it has already happened. crazy world. if you want to know what real power is check out times square on new year's eve. every year it draws millions of people o.

we will meet the man behind the making of that ball. i'ts your tv, take it withou.wi, stream live tvnyere taree. jo directv today startg at $35/moh. stream live tvnyere taree. noxtra monthly fs. ♪ jo directv today startg at $35/moh.

welcome back. love this song. you are looking at a shot of times square where they are getting ready for tomorrow's big new year's celebration, the lowering of the waterford crystal ball has been a tradition for over 100 years. with us more for more is the ceo of fiskers, the parent company of waterford among other brands. >> it is such a wonderful opportunity to be here. >> this is it for you guys. this is the biggy. what does geodeesic sphere

weighing 11,875 pounds. that's quite a masterpiece. >> we are so proud of the ball. it is such a wonderful piece. i have a small piece of it here. we have 2,688 of these specifically made crystal triangles. it makes a wonderful vision there. >> you should sell that to people to put on a tie or hat and kind of participate. so how important you mentioned the features that go into this. for waterford how big of an event is this for the company and the brand? >> it is obviously important. we are very proud to be part of such a big heritage which takes place at the center of the new york times square. it's extremely important. >> i knew you have been

providing the ball since i think 2010. what happens to the ones that have been used? >> we actually use them for charity and other purposes. there is a great story gift of kindness is the theme for this year special edition. >> i wonder if you can do more with the ball drop. i know it is iconic in times square. you can take this to every other place in the world and make them their own waterford crystal ball to drop. people can do it at weddings. are we the only place that does the waterford ball drop on new year's eve? >> absolutely. that is where fiskers comes into play. it is a wonderful thing to have waterford as part of fiskars.

we are so proud to have it. we have more than 3 1/2 centuries of heritage the company was established in 1649 and we have been around for more than 360 years. >> i love the orange scissors. how much did it cost to make? >> it is priceless. >> is it millions? tens of millions? >> it's really priceless. it's used in the special moment. >> understood. are you going to be there for this one in times square? >> absolutely with some of my colleagues. we are certainly going to be there to celebrate to bring in the new year. >> you are a brave man. i don't know that is a lot of people it is very cold. i'm sure you get vip treatment.

remember he told it to us here. up next our highlight reel from "closing bell" reel from clo "closing bell" celebrity guests and their bige money mistakes. stay with us. your insurce c

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welcome back. most celebrities have plenty of money to invest, and that can spark some wacky business proposals and some room for money mismanagement. we often ask the stars to visit us here what's your biggest money mistake. let's take a look at some of our favorites this year. i went into a business when i was a struggling actor. i bought a trampoline game. yeah, trampolines, and the insurance company said, they're breaking ankles. it is like -- probably those little roomba vacuums. i kind of got obsessed and thought i was in the jetsons and started buying bunches of them and they're bumping into each other and chasing my cat and knocking things down and breaking them. that was sort of a mistake. i had the chance to become a major investor in starbuck's. >> really? >> would have, could have, should have. you didn't because? >> at the time it was brand

spanking new. i met howard. >> and who is going to buy coffee that much, right? >> especially when it stunts your growth i hear. probably not to bias mauy a shoes and clothes. >> wait, they're not good investments? >> my husband has finally gotten through to me there's a better way. you haven't made any money, you sold 43 million albums. >> i signed a contract, i had to turn chapter 7. when i did that, it wasn't because i couldn't pay mastercard. it was to get out of a deal. i've been very lucky in business. i have learned from the best people in the business, so not yet. >> welcome back, alphabets conference. >> sorry to crash n you asked that question about my dumbest environment. >> ron howard we welcome back onset. on the way out i realized i had a dumb investment. when i was on "happy days" starting to make cash, i got talked into investing in super

cow 'embryos that would yield superintendents cars and get rich. >> not, you didn't. whose idea was this. i don't know. somebody probably an extra on "happy days." >> one more time, their pitch to you was we have a super cow? >> we kent went to a dairy and it. they were creating these super cow embryos they would sell and they would yield super cow, and you would invest in a super cow that would give an unbelievable amount of milk and everybody would be rich. >> the whole thing went sour. true to form you always have the best lines. >> i was waiting. i couldn't believe you guys were going to leave it out there for me. notice what? after we had ron howard tell us, that scam has been ongoing for decades. that was in the '70s. there's been charges brought against people in recent years for basically pulling the same one over. >> okey-dokey. what do you think is the biggest mistake investors are making now? >> i think one of the biggest mistakes, people look at the stock and bond markets and feel

they have to swap between the two. we talk all the time, is it time to rotate one or the other. i think that requires so much foresight nobody can have it. so just stay diversified and don't pretend you have a firm expectation of what the markets are going to give you. >> it seems to me from observation, trying to time the market any which way, it is nearly, virtually impossible. >> if i gave you the headlines from 2016 and said, where do you want to be, stocks, bonds, wherever, you probably would not have said, let me ride the s&p to a 10% return. >> i'm not a huge fan of predictions for the next year, unless it is a way -- look, there's the useful predictions and things about what people think, at least it tells you what to move against. when everybody is on one side of the boat you know it is time -- >> as an exercise maybe it makes sense to get clear on the main factors, but not to have confidence and conviction on what will happen. >> speaking of which fte and football pointing out the appetite for commodities might be one interesting place to look for 2017. basically, people have gotten so

excited about financial assets, commodities have had a horrible five years, albeit they're making a comeback here in 2016. that could be of space to watch for next year. >> it is interesting because we're a few years past the peak of what you would have called a commodities super cycle, right? maybe when gold peaked in 2012 or something like that and they had a long period -- now, look, they came back big in a very short term. it looks like they're up a lot for the past three months, but look at a ten-year chart. they're not up at all. >> exactly. not totally related but big coin, you know, it is going to close out the year getting a lot of last minute headlines, is it china, is it india. you know, this thing -- >> or is it one of the speculative episodes they had in the past. >> exactly. nevertheless, there has been huge movement in the markets even though the overall action we talked about with the 30-year for example, it did a round trip this year and it's been true for a lot of things. if you talk about some of the best performers we have seen, talking about the etf's, it is

the gtx. they finished up 56%. the semis, banks up in the range of 30%. the xle, energy, up nearly 30%, and then the worst iibb, the biotechs which we talked about, the homebuilders having a tougher year. >> the biotechs and really pharmaceuticals in general, again i keep saying at least there are some of the elements in place for that to be something like energy was last year. who knows it will have a 12-month comeback like energy did, but it seems it is cheap and everyone thinks they're cheap for an iron clad reason, right? because of policy and the rest of it. >> exactly. there's the performance of the major averages year-to-date. dow up 13%. russell 2000 small-caps up nearly 20%. peter weinberg quoted in the journal saying he thinks 2017 will be the year of the deal, everything from tax repatriation to other areas that might be ripe for it. this year we've seen a slow down both in deal making and public

offerings. >> a lot of policy, tax and regulation and everything in motion. obviously a lot of capital probably in motion, too. so i do think while those guys always think that the conditions are ripe for a deal boom, i do think that there's a lot to it at this point. plus, look, we're late in a cycle. >> yeah. >> it doesn't mean we're at the end of it, but in is about when you have big companies trying to make bold strokes. >> this weekend, comcast charter, how they're going to resolve that issue, plenty to keep us busy heading into 2017. the "closing bell" team would like to extend congratulations to one of our members who welcomes benjamin david to the world yesterday. he weighed in at five pounds, 15 ounces. a little good night with a lot of hair already. >> absolutely. congratulations to vinnie and his wife. >> we want to thank the crew and our "closing bell" team for the help throughout the year. and reporting the great package everybody's money mistake. >> we will keep doing it this year, so great. >> i haven't asked the bosses yet but i think it would be a

fun companion to run. >> sure. >> that dose it for us on "closing bell." thanks for tuning in. happy new year. we will see you in 2017 and "fast money" begins next. "fast money" starts right now. live from the nasdaq market site overlooking new york city's times square on new year's eve eve. look at that beauty, that is a shot of the times square ball earlier today getting ready for the big night. traders on the desk, tim see more, heather zumaraga and brian kelly. it has been a banner year, the dow up 14%, s&p up 10%, the nasdaq up 8%. of course a lot of the gains have come in since the election of donald trump, and despite the markets falling 1% this week america is ending the year a lot richer. the s&p adding an impressive $1.5 trillion in market cap in 2016. and it was a tale of