ephemeral neutral point. >> was it that spring-like catalyst brian belski on this show yesterday that said it could be one little thing that sets the markets higher? in this case it was fed commentary. >> and the change in language. all important. thanks, dom, good to see you again. >> great to have you here. >> thanks for watching "power lunch." >> "closing bell" is right now interest rates are still low by historical standards, and they remain just below the range of estimates of that level that would be neutral for the economy. >> those words from fed chair jerome powell sent stocks ripping higher welcome to the "closing bell," everyone the next big question on everyone's lips, will it mean fewer rate hikes than previously expected we will debate that with our panel of experts. and we're also closely watching the next market-moving event this week, the trump/xi meeting at the g-20 summit we'll discuss which stocks are most at risk if a china deal doesn't get done. >> i'm sara eisen in for kelly evans. the l.a. auto show is kick off just as president trump ramps up

his criticism of general motors. we'll hear from some top auto executives about the war of words with the white house. plus, from china to the fed to market volatility, what matters most right now to corporate america? we'll speak live with the shell chairman, former dupont ceo chad holliday about the biggest issues facing u.s. companies "closing bell" starts right now. ♪ holiday, celebrate >> good afternoon. welcome to "closing bell." let's get straight to the markets. now comments from fed chair jay powell sending the dow soaring, rallying 560 points at the high, currently higher by 470 points, so 2%. >> just below neutral is a long way from neutral which is how he characterize it had back in october. that was all the market needed to hear to take off and rally. every sector is higher right now led by tech. except for utilities which is slightly red. today's advance by the dow, s&p and nasdaq are their best in

three weeks, and i would just note that the dow is up 1,000 points since samuel, my son, was here at the floor. more on what pole said today with steve liesman steve, the big headlines, what stood out? >> fed chairman jerome powell, ignited, as you said, a powerful market rally saying the fed is, one, not on a pre-set course to raise rates and, two, the fed is just below the range of neutral estimates, that is the rate that would neither slow nor speed up the economy. >> interest rates are still low by historical standards and they remain just below the range of estimates of that level that would be neutral for the economy. that is neither speeding up nor slowing down growth. >> there it is he added, as he said, the rates are low by historical standards and he affirmed the fed's plan to gradually raise rates and maybe less certainty as in the past he likes to walk into a room full of furniture with the lights turned off. you slow down and feel your way

around carefully markets shot up, bond yields and the dollar shot down, and powell maintained his generally upbeat view on the u.s. economy. >> the unemployment rate is 3.7%, a 49-year low, and the many other measures of labor market strength are at or near historic bests inflation is in our 2% target. the economy is growing at an annual rate of about 3%, well above most estimates of its longer run trend. >> reporter: maybe this is a relief real, guys, relief that the fed is not hell bent on raising rates no matter what the actual economic outlook. >> steve, what about the kind of financial risks in the system? he addressed it. it was talked about for a moment, but it wasn't similar to 2007-'08, right? >> reporter: and he said things were quite a bit improved when it came to banking and liquidity standards, as you well know, wilfred, covering the banks as you do i don't know if it was part of the rally, but it certainly could have held it off at bay

because if he had given a negative view on that. he did say there were risks of corporate debt, risks with leverage and hedge funds but overall said financial risks were moderate. again, sara, i want to point out the comment by powell that was neutral was just below the broad range of estimates, estimates of 2.5 to 3.5 so some people wrote interpreting powell's remarks he could have two, three or four hikes to go to get somewhere in the range of neutral. >> a good point. >> does today's speech change the policy path forward for the fed? >> i don't think so. i think one thing happened the fed and markets had a meeting of minds on what the outlook is right now if the economy were to continue to go above trend, if the unemployment rate comes down more, you'll get more rate hikes. what the market likes to hear is not being on a pre-set course

and everybody in the market wants to hear their thing and no matter what we're going up to this 3% range. >> i think data dependence will be the key. >> yeah, people like that. >> steve, thank you very much. as always, we'll discuss this further. here to debate whether or not it's changing the path of rate hikes, manny deppler from national taxpayers union and peter conte brown from the warden school of business. manny, what was your main takeaway >> data dependence was a key term listen, i think it's really important to pay attention to what we think would happen if the fed didn't hike. there's a lot of discussion about whether a hike in december is wise and because of the forward guidance and the tumultuous two months, if the fed were not to hike now it would signal broad criticism of both the fed's independence and the ability to really read the

tea leaves on what the economy is doing so i think it's very important for the fed to stay the course now, and i think we saw that from powell, powell saying very much he's dependant on the data, but also he wants me flexible and agile when it comes to reading and what's happening in the economy. you mentioned before what the next year looks like there's still not broad consensus on fomc on how many hikes we'll see in 2019. it's very important for the fed to stay the course going into the new year in order to have stability moving forward. >> peter, how did you interpret today's comments and the market reaction >> i see chairman powell trying to preserve himself some freedom of movement, not only, because as you said in the dark room trying to find the furniture, the fomc doesn't quite know where things will land they will always be playing a game of catchup, and what he's trying to do is walk back the uncertainty of a fixed path. i think that's good. the problem is with that freedom of movement is this look that trump has tried to recast the

federal open market committee's monetary policy as a battle of personalities. it's hard to see whether or not the fed is falling into that narrative or is pushing up against it. >> do you think inflation could surprise to the upside, peter? >> i think it could. the problem with having a 2% inflation target is if you chronically undershoot that target and then overreact by hiking interest rates when it goes a bit above, what you've done is actually reset your inflation target well below 2%, so i think that those who advocate, including on the fomc saying hey, we should relax a little and let inflation overshoot to be consistent probably have the better of the argument the problem is the fed has reached its credibility by delivering those goods and price stability, so the fed is a bit between a rock and a hard place in terms of its history of credibility and the fact that that -- that they haven't hit their target very well in the last few years. >> i mean, the credibility also comes from its history

independence, and the president continues to ramp up his attacks on jay powell and his policy how do you think that complicate a complicates this >> can you make decisions how the president will act or how you think he should act. the fed has not typically raised rates in december. this will now create an environment in which public policy becomes much more difficult really to move forward on simply because the president will have a reaction i think it's really important for the fed to stay the course going into next year because there are other public policy difficulties and challenges that i think will create a lot more volatility if we don't have a fed that's living up to the expectation that's set i'm talking about the trade pressures, going into the g-20 at the end of the week and knowing what the united states is going do when it comes to both china but also to the eu and potentially new auto tariffs as we see the conversation about gm continuing to progress. the fed needs to create a

stanleyizing environment here as the public policy creates big questions about what next year's economy looks like. >> on that front we've got more news, fed minutes tomorrow and the g-20 minute going on with president xi. >> thank you both very much. >> thank you. stocks are surging today the dow has gained 1,000 points in just three trading sessions let's goat our "closing bell" exchange >> renee north joins us frushan wealth management and jack bouroudjian and keith bliss. keith, the real, is it based on a fundamental shift in tone from fed chair powell >> i think it had a lot to do with it. i agree with all the guests who spoke of that. you saw the comments and then you saw the spike and a chart that lukes like idaho lying on its back. >> that's true.

>> you real very to point that right now. we're out of earnings season, and the market is focused on fed policy and fed speak now trade policy is second, and then everything else. own political instability around the world doesn't so many to shake the markets, you know, ability to keep rallying forward and looking to that piece. i do think jay powell really tried to thread the needle in his speech and give something to everybody, hey, i still have my independence, but, president trump, i am listening to you certainly that's the scuttlebutt that we have down here on the floor, so we'll see what happens. >> i'll draw idaho for you. >> i just goggled it. >> it's idaho on its back. >> yeah. >> jack, let's talk about the reaction in the bond market, currency markets, a much bigger reaction in the dollar than the bond markets the ten-year essentially flat by the end of this week. >> but you still saw a steepening of the yield curve, wilf what you saw was the short end of the yield curve starting to go down in yield that's actually what we wanted to see you know, there's something that

happened here today that no one is talking about i think we saw the creation of the powell put this is something that people have been talking about now for the last few weeks and, you know, quite frank lit market has been yelling and finally, you know, the chairman listened. a couple of days ago i got on the show and talked about the market could rally 1,000 points in a couple of days and sure enough we saw it we see the other part of the headwinds that are in front of us, and that's tariffs start to get some relief then watch out you know, we're talking about a -- a potential melt-up scenario it could be a december to remember, so all of this is being factored in, and the fact that you have got a steepening of this yield curve and the way it's being done is very, very bullish for stocks >> renee, are you as optimistic about what we're going to get from g-20 and what the market reaction would be? >> well, it certainly would help i'm so happy that we have a traditional santa claus real, but we just had one of those

biggest challenges removed today with the -- with the indication that the feds are going to kind of slow things down so that obviously is a big powerful impact to the markets, and if we do get to some dissemination with the trade war around the tariffs, that's going to be amazingly profitable for the business for this market, but i'm still looking for a slowdown in the economy for next year so i still think this is a good time to be adding some boring sectors and boring stocks to the portfolios, to be defensive and be red for the next level of volatility that i expect is going to be coming into 2019. >> coat, clearly we were due a bit of a bounce which we've had over the last few sessions does this continue or is it a one-off free pricing based on slightly altered expectations? >> the dow and the ndx, nasdaq 100, hit or oversold readings a

week or so ago yesterday so we did expect a bounce. the one thing that gives me hope that it will continue, if you're a bull, let me say that, the russell needs to lead us out of this it's something that's been persistently lagging i want to see that take the lead the rest, the dow, such a narrow index, it will always be there in a dollar weighted index, price-weighted index the russell needs to lead the s&p 500 and the tech names come roaring back, and then i think we rally hard to the end of the year. >> very interesting take renee, jack and keith, thanks very much for joining us. >> thank you. still to come, much more on today's fed-driven surge and a look at whether the rally can last. >> and despite the rally, there's some somber news for the housing market today as new data points to a major red flag for real estate. we'll tell you about that next and we always want to hear from you. you can reach out to the show on twitter, facebook or send us an

e-mail "closing bell" will be right back with the dow up 484 points.

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and two-hour appointment windows. click, call or visit a store today. welcome back to "closing bell." 43 minutes left to trade the dow is nearly 500 points higher 493, almost 2% there's the individual winners caterpillar, boeing, united health, visa, some decent moves there. 3% to 4%, a nice spread sector and stocks pretty much everything higher. >> maybe pointing to optimism around the meeting at g-20, caterpillar. a big trade, and boeing, trade-related story. began motors sitting out today's big real as president trump ramps up criticism of the

company's restructuring plans. our phil lebeau joins us from the l.a. auto show how much buzz has there been, phil >> reporter: a decent amount and the one tweet from the president that's getting the most attention. we won't read all of it, but in particular what he's referencing when it comes to imported vehicles, the president tweeting this morning the countries that send us cars have taken advantage of the u.s. for decades. the president has great power on this issue because of the gm event. it's being studied now brings up the question what we're buying in this country, where is it coming, from 56% is built domestically what you want to focus on are the 15% of the vehicles coming from japan and europe. those are two areas that the president has talked about perhaps putting some type of higher tariff on imported vehicles from there. the other part of regulation that is getting attention is whether or not the trump administration moves to strip the $7,500 per vehicle federal tax credit

when we talked to ceos earlier this morning they made sure that the ev incentive is needed to keep the small amount of ev sales moving higher >> i think evs are important evs are important for the future it's a starting up market and i think a startup market needs a little help. >> long-term we believe that the electric cars have to be competitive and that customers have to pay for them, but, i mean, in the beginning when you have low volume, the cost of the batteries and electric motors are higher and it's very crucial that you have supporting programs from government. >> reporter: gm has pretty much used up most its allotments when it comes from the federal tax credits. it goes to the buyers of the first 200,000 vehicles sold in the u.s., electric vehicles in the u.s.

gm will pad that threshold before the end of the yore, and the incentive is phased out over the next couple of years so for began motors that ev incentive will be disappearing over the next couple of years any sort of wild card punishments put in place a lot of people talking about the loan of course, the focht made loan back on the loan and on the shares that they had to purchase any other wild cards now >> completely out of the question that's completely out of the question it was a structured bankruptcy it went through bankruptcy court. you might not have liked the terms, the american public, some might not have liked the terms of the gm bankruptcy but it was signed off of by a court and a judge. you can't go back and say, you know, what i didn't like that deal let's redo it. that's not how it works in bankruptcy court that ship has sailed, all of it. >> the subsidies are one to watch. >> yeah. >> phil, thank you

are phil lebeau. >> we've got 40 minutes to go before the opening bell. >> rally mode. >> before the opening bell. >> "closing bell." >> i do a show in the morning. >> which is also after the open. >> but, yeah, sometimes in the 9:00 we're marching into the close with a 2% gain for the stocks. look at the dow, up more than 500 points third day in a row that stocks are higher now that fed chair's powell speech is behind us, a big catalyst, investors are looking ahead to the big event and that's the meeting between president trump and president xi at the g-20 summit >> and one company not participating in rally is tough any's as earnings missed estimates. a bull and bear debate on what to dwihastk.o th tt oc we're back after a short break

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welcome back to "closing bell." the high today for the dow is 5660 we're at 518 at the moment so still looking pretty good, rallying a little bit approaching the highs with 35 minutes left of trade. let's check in on some video movers today salesforce soaring after reporting an earnings and revenue beat yesterday after the close. the company also issued an upbeat outlook for sales in the fourth quarter initially people sort of felt, including us, that the guidance was soft, and that dragged the stock lower for the first 10 or 15 minutes clearly shrugging off of that

off are great ease it had been down double digits so in the short term gham with a decent setup and it's still up significantly. 34%. looking at the analyst estimates, 43 rated on facts that 91% have buys. >> but the results back it up. >> cnbc put together a nice compilation of all the analyst reactions to this report, glowing report morgan stanley says this is the kind of secular story you want to own in this volatile environment from continued double digit sales growth. cramer has been pounding table on this one and the quarters that mark benioff continues to put up, and he went on "mad money" to talk about it again last night. >> i'm watching a stock that's going the other way. j.m. smucker with a miss on revenue and sales of the coffee and u.s. consumer food stocks flipped. the stock is getting pounded

down 7%. it was already a big liars so far this year and speaks to the problems in the food space this is why campbell soup had to agree to take on activist proposed board members the companies cannot grow, and right now they are getting slammed even harder because they don't have pricing power, so the input costs are going up they are paying everything higher, higher freight costs and higher commodity costs and they are not able to pass that on to the consumer they don't have the power because the brands are just like jiff peanut birth and smucker jams aren't working right now, even in pet food which the company has gone deep into. >> pet food was growing year over year. as you were saying the consumer foods was particularly weak. >> really weak >> look at kraft/heinz. >> the sales for is back up, the value in the stock. >> we have 34 minutes left in trade, as we mentioned, before those individual stock movers

were up over 2% on the dow, s&p just shy of that, and the nasdaq leads the charge up 2.5% much more on the fed-driven rally. and why one adviser think the fed should hold off raising rates in december. >> and with so many factors influencing the economy, what matters most to big corporation? you'll hear from the chairman of royal dutch shell and also former board member of bank of america and ceo of dupont. chad hliolday will join us next on "closing bell." free access to every platform. yeah, that too. i don't want any trade minimums. yeah, i totally agree, they don't have any of those. i want to know what i'm paying upfront. yes, absolutely. do you just say yes to everything? hm. well i say no to kale. mm. yeah, they say if you blanch it it's better, but that seems like a lot of work. no hidden fees. no platform fees. no trade minimums.

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world's best inflight entertainment. fly emirates. fly better. welcome back time now for a cnbc news update with sue herera. >> here's what's happening at this hour. secretary of state motorcycle pompilio briefing senators on issues relating to saudi arabia and yemen. afterwards, he comment on the killing of journalist jamal khashoggi. >> i do believe i've read every piece of intelligence unless it's come in the last few hours. i think i've read it all there is no direct reporting connecting the crown prince to

the murder of jamal chairman of the boardgy. that's all i can say. >> columbia university researchers are reporting that more people are seeking mental health care but not those who need it the most they say the majority of the increase was those with milder symptoms in addition, more people are being prescribed psychiatric drugs, including those who may not need them. and norwegian grand master magnus karlsson has defended his world championship but beating an american champion 3-0 in rapid tiebreaker games the three-week match ended in 12 draws before karlsson's victories today. congratulations to him you're up to day that's the news update this hour guys, back to you. >> i can't imagine people going to watch that live. >> a chess championship. >> it's a very skillful game to play and all that kind of stuff but it's not really a viewing sport? >> i think there's a great intensity for it

i don't know i'm not a view sue, thank you >> neither am i, but i applaud them for being able to do it. >> agree. sue herera, thank you. 29 minutes to go in today's session. stocks still surging after fed chair jay powell's remarks this afternoon. let look at the movers of the day and bob pisani on the floor as always and booertha coombs, p at the nasdaq, what stands out >> the whole market lifted on the powell speech but particularly industrials, technology and some of the peelers. caterpillar, of course, always a belle weather and 4.5% on the upside and many of the other big global industrials up 3%, 4% healthcare also doing quite well today. united health up 3% and most of the healthcare stocks rising 2% on that. we also saw a particular rally in the material names. remember the problems that they have been having, the strong dollar, slower global growth overall here we saw a big real in the

materials. freeport-mcmoran, a good example up about 6%. i mentioned not participating. most of the consumer staple names that are rallied as we sold off on the cyclical names a few weeks ago. they are not doing anything. that's procter & gamble essentially flat right now, so where are we what's the market risk remember the two biggest ones, of course out there, number one, the risk of aggressive fed tightening that risk is lower, though i would point out mr. mowl did not change his overall outlook on the xhu. the other, of course, is the trade war issues and, of course, some hope that the meeting this weekend scheduled between president xi and president trump might produce some kind of truce. we'll see if that could spark another market rally guys, back to you. >> thanks very much for that let's send it uptown to see what's happening at the nasdaq with bertha coombs. >> reporter: hey, wilf, a fairly broad real and the nasdaq composite outperforming, but when it comes to month to date it's lagging, still just

fractionally lower for the month along with the nasdaq 100. today, what's really moving tech even before that powell real was the strong results from salesnorse.com that. has a lot of the cloud players today moving much higher right along with the bullish outlook coming from mark benioff one of the biggest cloud players is amazon when you take a look at the big megacap tech names. they are all moving to the upside and that's helping to provide the biggest impact one of the biggest things we've been watching is apple and microsoft as they move who has the market cap supremacy microsoft for a time today topped apple right now it is back behind as apple moves to the highs of the session. guys, this is one of the fascinating things to watch in realtime back to you. >> all right keep an eye on that apple comeback, bertha, thank you. the highly anticipated meeting between prmp and china's president xi jinping at the g-20

comes on the heels of a new report that the u.s. could be ceding its leadership position in technology to china joining us is chat holliday, charity of dutch shell chad, so nice to see you again today, the big talk on wall street is chairman pole, and there's a celebration of his new found flexibility towards interest rates when you think about the biggest issue facing the market and the economy, do you think that's the fed or the china trade issue >> what we've been foucsing on is the china trade issue and the technology leadership. our data released to date says china is catching us in the amount of effort that they are putting into new technology development. we think it's important that we continue in the lead there, but the other factor that we've really focused on today is the training of our own workforce here in the u.s.

we just don't have enough of the right skills at the right places we had a report that said 31 million people started a college education but didn't finish. well, how do we find ways to train those people so they can take on very meaningful jobs >> chad, is it lose competitiveness just to china or to other countries as well >> china is the one that stands out, that is really focused on what i call the energy transition that the whole world is going through they are investing in the raw materials that are necessary, and they are investing in the research so that's the one country that looks like it will challenge us for the lead. >> when it comes to how to deal with it, do you support the president's approach, add on the tariffs, bring the chinese to the people and try to make a deal does that help

>> we all have to find ways to protect that something we've talked about for decades and perhaps right now is the time to reach the next step in agreement that will be good for china in the long run because they will protect their intellectual property, too, and also good for u.s. companies. >> a lot of the debate at the moment is if there is something positive to come out of the g-20 between presidents trump and xi, if that will three-day a big rally and stock prices in your expert opinion as chairman of shell, do you think it will lead to big movers in oil and commodity prices >> that's not my expertise or what will happen there i think what the real needs now is predictability. generally economies around the world are doing quit pell and we need to keep focused on have, i

was just there for you weeks ago and really locking forward to this and are going try to make it be very successful. >> it's not just trade policy. you have a lot more to talk about in terms of new policies that affect big business, from deregulation to corporate taxes. bottom line, chad, are we more or less competitive under the trump presidency than a few yearsing >> reporter: >> i think we've made significant advances in our competitiveness, not just in the last two years but before that the entrepreneurial spirit here in the country is amazing, so we decided that we have advance into new forms of energy to meet the needs of our customers in the future with this energy transition, we've put a major facility in boston, and we've put a major facility in san francisco all around technology development. we could have gone anywhere in the world to do that, including our home country the netherlands, but we found that the u.s. was a competitive place to be. i think we voted with our

investments. >> that said, chad, the happen the has been very clear in the last weeks and months for oil prices to fall, and presumably you would like oil prices higher would you like him to hold off on jawboning oil prices lower? >> well, we don't conspire to set oil prices that's illegal oil prices have been volatile, and we'll gear up with our supply hand trade organization to do that and we produce is.5% of the energy in the world but sell 3%. we're big boys and sellers and focusing more on natural gas today than we were will have many. >> okay. chad, thank you very much for join you go. chad holliday, the chairman of

royal butch shell. >> from the national competitiveness forum where they are talking about all's issues and the ceo of drooe told us he thinks tariffs are doing more harm than good even though he agrees something needs to be done about china and chinese technology stealing our technology. >> what was referenced at the top of that in terms of the massive increase in r & d investment and something that season has done and whether it's taken effect fully yet, we'll keep an eye on that. 20 minutes up until the close. a very positive session led higher by the comments from the fed chair powell of up around 2% on the dow, 2.2% of the straight ahead on "closing bell. shares of tiffany's sinking and on pace for its worst day in three years. a debate on that stock coming up. >> plus, new home sales fell almost 9% in october we'll tell you why next on

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the low was up 84, but we have continued to rally throughout the day, particularly when news of the embargoed copy of fed chair jay powell hit the wire. >> nasdaq up almost 3% not home builders. sales of new homes in the u.s. fell 8.9% in october the home builders are trading lower. let's send it over to diana olick for more what's going on in the housing market >> reporter: look, homes dropped in october to the lowest level in 2.5 years as they came in for rising mortgage rates and the median price of a home did fall 3% compared to a year ago and that may just be only the cheaper homes are selling now because of higher rates. today's buyers have new math to factor in. mortgage rates are a full percentage higher than they were a year ago so the builders fell sharply after that report, but they have since rallied back with a broader market. now, one big concern in the report going forward there, now appears to be a glut of newly

built homes for sale the highest number of unsold units since 2009 now only 22% of those are completed and completed homes are selling quickly so it's hard to say if it's the demand slowdown or the longer time that it's taken to actually build these homes and given that severe shortage of lake, now the bright side to that high supply is that it could finally bring prices down a little bit, but, again, for the builders it's hard to do that given the high cost of houses today guys >> diana, there's a big debate about what housing signifies over the economy and now that the data has gone from bad to worse, i'm wondering how you view it. is it its own separate thing driven by secular forces >> i think it's an absolute indicator of the future. look, when you talk about buying a home it's the average person's single largest investment, so when you look about people unable to buy homes, what do they do are they going back to the rental market? rents are sky high right now that means more money is coming

out of consumers' pockets to pate rents and if they are owning a home and want to move up and can't, maybe they will put money into a renovation, maybe they are not so it weighs on all factors in the economy because, again, it's the biggest investment and it's usual lit most money coming out of anybody's pay check. >> diana, thank you very much for that diana olick back in d.c. for us we're keeping a close eye on consumer discretionary stocks, among the best performing groups in today's trading, the latest to exist correction territory, down less than 10% from its recent highs in late september amazon is the best performing stock in the group on pace for its second best day of the month. retailers like nike and under armour leading to the upside and mohawk industries is notably higher despite the drop in new home sales back to you guys

>> eric, thank you checking consumer stock, one retailer not doing well is luxury retailer tiffany. we'll indicate whether you shoulduyr ll b ose with the stock down 12%, next and seamless experience across web and tablet? do you want $4.95 commissions for stocks, $0.50 options contracts? $1.50 futures contracts? what about a dedicated service team of trading specialists? did you say yes? good, then it's time for power e*trade. the platform, price and service that gives you the edge you need. looks like we have a couple seconds left. let's do some card twirling twirling cards e*trade. the original place to invest online. when it might be time to buy or sell? with fidelity's real-time analytics, you'll get clear, actionable alerts about potential investment opportunities in real time. fidelity. open an account today.

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welcome back to "closing bell." we are about ten minutes out until the close. nasdaq is up almost 3% right now, near session highs with the dow. session highs, the dow is up 600 points right now the s&p is up 2.25 the rebound continues, and jay powell added some fuel to what had been a pretty good few days. >> please check the @cnbc twitter feed, a very important live vote taking place between sara and i check it out you can read why, and we will reveal the winner. 60/40. >> this is a big one. >> it's a very important one. >> please check in on the twitter account. shares of tiffany getting slammed today after mission on sales estimates. the luxury jeeler blamed weaker spending from chinese tourists in hong kong could this be a buying opportunity for the stock. here to debate is are semien

segal and roger giffin this was a miss based on china's tourists, both in hong kong and u.s., is that right? >> yeah, it is, and it's a great day to be on the bull side of this debate, so i think what we have to figure out is what changed. i have to own this, think about what changed today versus yesterday and you have the stock price that changed and you have this tourism piece that changed and you've been talking about the cost input side of the tariff that's one side of the fear and the other side that really brought about mass multiple contraction was what happened to that tourist that was a fear that real couldn't be dispelled until next year and i would argue most retailers that had yet to report were going to be asymmetrically skewed to the downside the problem is tough any told that you tourism was a concern we can't get away from that. the point here is that worth the deceleration in the stock?

i think what's overdone. >> taking the other side >> you know, you didn't tell me we would be on the set, my favorite han lift that i had to go up against, but i'm not a fan of tiffany i wasn't a fan of tiffany coming into the print and i'm not happen we them after the print i didn't like them here and i don't like them before, and i don't like them for a very fundamental reason i think the upper end could very likely struggle in 2019 in any event because we'll see the bi-coastal blue state, a fluent consumer take a big hit on the taxes and we'll see the business not be quite as strong in general in 2019. here we're seeing the chinese consumer slow down this is not temporary. the chinese consumer is going to be slow. >> the currency is struggling and if the tariffs go on it will

struggle more so i don't see that happening so while i like to work on paper flowers, i think it's hard to replicate and while i like the fact they have a good local consume, the chinese consumer is going to be a big problem so i see that being a problem right through 2019 i don't see this getting better for tiffany. there's too many negatives running through the number. >> for all the consumer discretionary or just tiffany? >> no, no, just the high end, and i think the rest of the consumer discretionary will be really good in 2019. i think the high end that's especially reliant on an aspirational not yet rich but high-end consumer like tiffany is going to struggle because i think this real makes a difference in 2019, g1 and q2, and who knows what happened in q3 and q4 and it's going to be a real struggle for the next nine months. >> take the other side and talk about some of the moves that

this company has been making they have a totally new design collection and new cool commercials and the cafe and how they will fight the macro. >> so i was going to say to continue this being the nicest, most love-filled debate, jan and i tend to agree. i agree with a lot of what he said and he mentioned nine months and i think duration is real important here. i think the reality is owning anything in retail for the next month will be really difficult and any catalyst for the next month is going to be difficult and i agree with the sales what's interesting here is the changes that the company has made, sara, to your point, and the way that we look at this company you've had an asset that's been somewhat inefficiently run for so long and didn't adapt or evolve with retail, and what you're seeing is very quietly changing the way they store their stores, changing how they approach and market to their consumer, looking at their supply chain a little bit differently and doing things as simple as tax and financial cubes so this is the

way we're viewing this, down 12%. it's much more of an operational opportunity so a little bit sales independent where you have company specific levers at your disposable and that makes it interesting. >> thank you very much >> we're out of time, i'm afraid great debate on both sides. >> too civilized. >> we'll be back in a up of cole months for the close which is five minutes away. elusive today. is it because so many 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. uncovering opportunities for alpha across public and private markets, while anticipating unforeseen risk, has powered our rise to a top ten global asset manager. partner with pgim. the global investment management businesses of prudential financial, inc.

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welcome back to "closing bell." two minutes left to trade. it's all about the few words just below the neutral rates said by fed chair jerome powell. big effect on the market only a small effect on the bond market to be mia farrow, but we did get a sharp steepening of the yield curve. we saw a big move in the dollar as the dollar index view intraday down about 0.6% today and an even bigger move in stock markets. there is the s&p 500 intraday. you can see that very clear big jump when the embargoed speech hit the tape and we're ending the day on the s&p up 2.24%. the dow is at session highs. if we look at all the indices, up 624 points, now up 680.

in percentage points, up over 2% and the nasdaq leads the charge, up over 2.5% so big moves across the board. small caps, russell playing a part as well and bring up the sectors as well as i bring in bob pisani pretty much everything is taking part. >> except consumer staples and utilities. procter & gamble not really anticipating i said powell would not change his stance on the economic position and he didn't and that comment being close to neutral a-ha he didn't say anything different, but it implies somehow, and that's what has everybody debating didn't change how he felt, but he did change that comment on going chose to neutral i would just note here high yield had a great day. had a two-year low in the hyg. just yesterday, high yields had a very good day. material stocks, all of the stocks were beaten up, they also had a terrific day overall, and -- >> the bell has gone. >> considered a bit of a bad

omen a bit of boos there. finally, new highs, we need to see some new highs we don't have many of them most are in defensive names like merck. >> bad omen because somebody pressed the bell earlier. >> they leaned on it. >> i hope it doesn't end this great rally we've had over the last three days. we're up 620 points, highs of the session and that does it for the first however "closing bell." back to you, sara. >> and welcome to "closing bell." i'm sara eisen here for kelly evans. wilfred frost will rejoin me in just a moment. along other as always with mike santoli, senior cnbc market commentator. here's how we finished up the day with a 2.5 point gain for the dow. that makes it the dow's and s&p's best day since back in march. s&p closing up 2.3%.

check out the nasdaq soaring, almost 3%. best day for the nasdaq since the end of october the russell 2000 index of small caps also participating in this post-powell real, up 2.5%. the question is is it the right course of action for the economy? we'll have a debate between former top white house economic adviser jason furman and former fed governor fred mishkin. that's coming up should the fed pause its rate hikes or not that's the question. powell apparentlymore flexible in today's commentary. leading the charge what is boeing and salesforce was big on the s&p post earning and tiffany was the laggard. fueling the rally was fed chair powell's comments signalling that rate hikes play slow down sooner than expected here's what he said. >> interest rates are still low by historical standards, and

they remain just below the range of estimates of that level that would be neutral for the economy. that is neither speeding up nor slowing down growth. >> joining us to talk about this and the markets today, michael block from third seven advisers. mike, it did sound different than what he said in early october that we were a long way from neutral. >> yeah. >> was the market right to celebrate? >> i think the market was right to take it as a positive that he moderated the language a little bit, but the way you get a 2.3% move in the s&p is in a settle change in the fed chair's message, half of all stocks down in 20 months and all the surveys and the market itself compressed in its defensive crouch. that's why i think once you got this reassurance from powell, that essentially the fed is going to remain flexible next year it's not really a radical change. >> i think it is a little bit of

a psychological change from the idea that he was determined to raise rates and get us back to normal. >> yes. >> so when he said we're not on a pre-set path. >> he's sad that before, that we're data dependant. >> that they were very geared to raising rates. >> the market talked itself into a place where the fed would be doctrinaire no matter what happened in the economy. there was never a pre-set path as i said, we've been kind of stewing in this slowdown fear for like a few weeks now and that was the context for today's move. >> i'm much more of the view it wasn't a drastic change in sentiment and, thereby the debate is, michael, whether or not we get a one-day revaluation based on a few expectation of hikes next year or if this is the start of a new real into year end >> right we have to ask ourselves where we are in the market what's different from the past times when powell has talked and talked about data dependence, as

you say, wilf, or have talked about being anything like that the difference is we've had this big market selloff it's an ecosystem where you have fed speak, fed policy, sentiment, positioning and overall market levels all interacting with each other in this, you know, very dynamic cycle and the say, look, powell saying what he said today is going to be taken very differently than it was before stocks are oversold. we're running out of sellers a lot of pain has been felting and here we are, a lot of people are positioned short they are underweight now, and they are licking their wounds. what happens powell comes out and sounds dovish he said stocks aren't wildly overvalued, something we haven't heard of so much before which got stocks going why did he say that? he's trying to instill some confidence and trying to say, you know, look, let's get things back to normal let's not pretend these guys are

not market dependant. >> data dependant first. >> that's my argument. yes, we're data -- we're here to promote growth and full employment, yeah, okay tell that anyone here, but let's not forget jay powell is a pragmatist and a business guy, founded the industrial group at carlisle he wants things to right the ship he doesn't want his legacy being i raised rates too quickly and the market blew up. >> that's his primary consideration. >> i'm saying it's market driven heresy. >> he doesn't want to be the guy that allowed a bubble to develop. if this thing barrels higher and we're not close to that and he's conscious of two-way risk and he's playing it that way coming into this week -- >> it sounded like he's been paying attention to the markets. >> sure. >> to the data, both signalling

a bit of a slowdown and he wasn't resolutely focus on higher inflation which he could be and a better economy. >> but i don't think you can go back to his prior statements and say, wow, he's really headlong for rates going up no matter what he's really determined to get short rates to 3% no matter what i think that was a bit of an overinterpretation of what he said. >> do you not think there's going to be more than a one-day move higher? >> no, no, i think the market was set up to have this kind of a move and he just dined of got out of the way by not trying to tell the market, hey, by the way, you better put back that third rate hike for next year that you've taken out of the marketplace. >> michael, if this was a drastic change in direction, which i know we're not using, but if it was, why not a bigger reaction in bull markets ten-year ended where it started the day, two-year, barely moved. >> fed sounds dovish, yield should go down a lot has to do with pain and asset allocation, a big risk on moving stocks, what happens

money comes from the bond market and the bobbed yield edges higher the ten-year is going to go back -- back below 3%. not much of a stretch at 3.06, but i what is saying that at 3.25 the point is they are headed back down, given the inflation data and the weakened housing data and the dovish interpretation, i'll call it this, dovish interpretation of powell's comments, and what matters is i see yields easing back in. on a day like today when you have an extreme move, you won't get so much of that. >> basic asset allocation. >> two-year note on 2.81, on october 1 before he spoke, it was 2.80, it went up to the u mid-2.90s and peaked three weeks ago so the bond market was not walking into today saying, oh, no, he's leaning haushish, what is he going to say today >> they were anticipating that he was going to change his town. >> they assumed what we got today is what we were going to get. >> dollar turned around.

>> it did. >> the deere ceo, sam allen appearing on "squawk on the street" earlier weighed in on president trump's policy of issuing tariffs on chinese goods. listen to what he said. >> the issue that he raises is clearly the valid issue that china has through -- through intellectual property theft has caused issues for us, and we need to remedy, that but tariff approach i think is doing more damage than good in hey lost respects. >> pretty candid comments i thought from a ceo that's right in the middle of this. he also warned about long-term structural changes for america's farmers and agriculture. if we keep the tariffs, for instance, are china will buy soybeans from south america and not the u.s. and they can totally change their game plan issues like that, you know, that the ceos are talking about and worried about. >> the agricultural version of shifting supply chains in a sense permanently, definitely an issue. not too surprise this.

generation of ceos, they got to be ceo by having a global strategy, by having a china strategy, by basically seeing themselves as not particularly a u.s. corporation so that's why i do think the kind of opposition to tariffs is interesting but totally consistent with their world view. >> michael, if we saw something improve at the g-20, do you think that would have a bigger effect than today's move on the fed? >> we'll see it could be more lasting the proviso there is i don't think we're going to walk out of argentina with a trade deal? there's going to be a long road ahead. trump could very well lead the g-20 and have a great meeting and suddenly threaten european automakers again that's what's going to happen. it's going to keep everything in balance and everything in check. >> a handshake photo of saying we're work towards a trade deal is worth how many percent on the s&p. >> you can see a day like today and then it's going to be no what what is the fed saying next

week, and what is the data saying next week what kind of hedge fund closure activity are we going to hear, things like that the thing i'll say on this i've been talking to folks in china or people visiting from china, very tied into the business world there you have to remember something you can say china wants our imports. china also wants to invest in u.s. companies they want to deal as well. everybody is saber rattling, and the attitude in chinese business is we want to invest outside of china including u.s. companies we want that environment good for them. >> how is the market set up for this talk? >> doesn't have high expectations for anything tangible the volatility index barely came down that's because of a what if bid in the market because of china, gus the g-20. >> sorry, michael, we'll come back to you in a moment. seema mody has the details. >> shares of sox up 2% on what

was a beat on the bottom line, a loss of 6% versus a loss of seven cents and revenue coming in at $155.9 million, slightly higher than an estimate of 154.6 million. slowdown in billing has been a bigg concern in wall street but billings in line the stock is higher and higher on the week by 7%, but for the year it is down amid the larger tech rollover that we've seen. two big concerns for analysts had been competition specifically from microsoft and google back to you guys. >> seema, thanks so much important for them to seat deferred revenues in line as well mike, another sort of long-term central artery jim growth story in tech doing quite well. >> it is it's still on the smaller side we should remind people that it's still an emerging company in a sense and doing a little bit of a transition, so, is you know, well received, but i wouldn't say it's necessarily in

itself a bellwether of the set. >> let's talk about some other software companies tech was a big winner in today's trade. the sector had its best day since late march software names like zalsalesfore >> does this mean, mike, stick with the winners and go for growth and not value when you have market value? >> i don't think it's a stark either/or decision especially when it was basically buy the indexes, chase them higher when both cyclicals worked and the old growth stocks worked all of them have come down now and it's not as if buy the winners and you're paying up at 52-week high prices. the big nasdaq stocks are down 15%, 20%. >> you're getting a deal on the winners. >> if the story of next year is economic slowdown, rates moderate, it's no longer kind of

an overheat story, probably growth stocks will be a net winner >> i'm still in the growth versus value camp. i'm in the growth camp which means healthcare, retail, tiffany's today notwithstanding f.growth is getting scarcer, investors will have to go somewhere for it i don't think the traditional value metrix are working properly that's a structural thing. when money pours back into the market, where does it go it goes into the large indices where is that, growth? mechanics of the market. market structure is broken, but we have to play it any way we can, and that's how i look at that. >> that continues to be a debate. >> the talks with altria in which jewel hasrapidly overtaken the u.s. e-cigarette market, sales have jumpled nearly 800%. the report adds any dealings between the two companies is

several likely weeks away but altria did move higher in after-hours trading. the stock has declined 20% because the company that owns brands like marlboro and skoal has struggled with declines in traditional smokers. back to you guys. >> thanks very much for that. >> bringing you back to the broader markets, michael, do you think we can see this continue to year end, and which sectors would you want to be overweight? >> yeah. i very much think that we have room to run here i keep hearing that the first data we had a little bit of a bounce, someone on this market said that's what a bear market real looks like. i'm wondering if that person will say that when we make new all-time highs. >> we'll -- you can't say that with a wry smile until we manage to do that as such. >> there's a lot of cat lifts here we've accepted a slower growth not headed into a primrose paradise but will have a rally back other and see where we go from there growth is slowing and i

acknowledge that, and we mentioned the vix before, stuck in the 18 and 19 and comes back in. in terms of what i like, tech, healthcare, consumer discretionary, and i do like real estate given my rate view, and i'm warming up to energy underweight energy for a long time, when oil was making highs and i got a lot of eye rolls well, it came back down and now i've gotten more positive because i think it's -- performance notwithstanding, i think the stocks have room to go here they are that hated. >> i think what he's saying it's a father christmas rally. >> yes >> call it will whatever you want, sara. >> the thanksgiving after. >> not had a thing, santa claus. >> and we'll get the add vent miracle of lights rally, but it all has to happen before the santa claus rally which can only begin the day before christmas. >> can the santa claus rally happen if there is no sort of deal and making nice. >> everyone hats put their christmas tree out now. >> we'll light them this week. >> exactly gives the market had

a little bit of incentive. >> trying to trigger me here. >> no, no, seriously if people put a check mark next to powell for that criteria to have a rally, what about g-20, what if it's just a photo-op >> i think that's fine you just check off that box. on the other hand, i don't think it's a bullish catalyst in itself just getting it out of the way. >> they don't have christmas trees in argentina anyways. >> why not >> too hot. >> expectations are too high like trump thinking he's back in wwe and hitting them over the head with a chair. >> thanks so much for joining us today. >> president trump gave an interview to "the washington post" yesterday. this line of the story actually caught my eye. it was from the reporting of the post they say that the president also appeared hung up on yellen's height he told aides on the national economic council on several occasions that 589 foot 3 inch

economist was not tall enough to lead the central bank, quizzing them on whether they agreed, current and former officials said last year lpl financial put out this graphic knowing the the correlation between the fed chair heights and interest rates, and it turns out actually the taller you are the higher interest rates you are paul volcker, 6.7, his fund raised 11% and janet yellen 5.3 rates near zero percent for most of her four years as fed chair so if trump wants lower rates which he says multiple times and has criticized powell, he should have picked her because she was short. >> that chart works and chairman powell taller than the rates have been hiking. >> had a slight height difference between us. >> who would be the better fit well, 6'5", or sara at 5'3". >> same as yellen. >> you can vote on twitter right now. we'll reveal the results at the end of the show and, of course,

mike santoli is going to weigh in with your >> with the deciding vote, you mean >> not the deciding vote. >> the deciding volt. >> don't forget the criteria of this is my main point to people who haven't voted yet. it's all about height, so that can really be -- so there can real only be one winner. >> one winner. >> and the president is definitely right about that. >> because nothing else matters. >> right, still to come, former economic adviser jason furman and frederic mishkin tell us whether it's time for the fed chair to pause >> trade war fears and a look at what names are most at risk ahead of this key meeting between xi and trump when "closing bell" returns an august to remember,

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million. their fourth quarter earnings guidance of 69 cents to 76 cents brackets what analysts were looking for at 75 cents. stronger than expected comps the street was looking for 2.1, and when it comes to the geographic segments, europe was up quite strong and asia and china up, stronger than that, up more than 20%, so much stronger internationally than in the u.s. where it was just about flat in the retail stores. >> back over to you. >> sort of the opposite story as tiffany. courtney ragean thank you with a big 7% slide on guess. >> i mean, it had held up better than some of the mall retailers. >> we've got a news alert here on disney. julia boorstin with the details. >> sara, disney announcing a annual difficult send of 88 cents per share. that's notable because it's a four cent per share increase from the company's last semi-annual dividend payment of

84 cents per share paid in july. bob eiger saying given a record financial performance that we're pleased to increase our dividend to shareholders while continue to invest for future growth. this brings the total dividends for the fiscal year to $1.72 you can see disney shares pretty much flat. guys, back over to you. >> thank you tech stocks overall soared today but trade sections with china could put some names at risk briere capital ceo appearing on "squawk box" this morning and here's what he had to say about companies like apple. >> my personal view it hurts the consumer afternoon s&l truly an unbelievable company apple is a u.s. treasure, and i think that for many of the companies that i would view as u.s. treasures, and i would put walmart and others in that category, great u.s. companies, they would stand to be hurt dramatically by big tariffs.

>> joining us now to discuss which tech companies could be hurt most by the u.s./china trade war, we've got david trainor and max wolf, a very good afternoon to you both clearly apple could be hurt by sales and cuts by tariffs. have they hurt already by ip theft or any of the other accusations out there? >> that's right, mike, i think you make a really good point. >> it's wilf, not mike. >> sorry, sorry. >> you can't let someone else take credit. >> yeah, that's right. >> look, i think the long-term impact of ip theft is way bigger than tariffs, and i think we've got to get the ip protection right, and tariffs is really the short-term sensationalism of what's covering up a bigger issue with respect to ip protection we're dealing with a culture in china that has never really been about innovation they are the fast follower and

copycater and don't know how to innovate, and they rely on the stealing of ip to grow their economy, and so this is a real difficult issue that we have to tackle at some point the longer we put it of course, you know, the more pain we'll have to deal with in getting things back to a fairer place. >> max, can you own apple going to this weekend with so much at stake on the trade faux? >> sure, can you always own it it's got a lot of appeal on a number of levels i think there's going to be bumps in the road coming up. i think trade news is going to be a major concern across the tax base, and i would highlight that for us when we try to break down the risks and rewards companies have major exposure because they produce and export from china and they have the ebb push you're needing to sell into china and part of what the tariff debate has done is we need to update our opinions so china is about to become one of trying to be the global heard in ai, a leader in a whole bunch of

e-commerce and it's important both as a producer and goods and services coming from the american company and it's a vital part of the growth story for a lot of national champions or the terminology was treasures and we've crowd our investment dollars in the etf age here so very important on a number of levels. >> max, which of the other big u.s. companies that you think are going to be hit hard or harder by this debate that haven't perhaps seen that share price fall yet >> we're pretty concerned about hpq here and others. there's national champions in china and names that the chinese would like to promote, including promotion of national champions, and if we look at the history of various nations that experienced trade difficulty with china, we don't need to look much further than recent difficulties that south korea-based companies had, and we've seen that the real

risk exposure for international companies having difficulty in their trade relations with the chinese are not always restricted to tariffs, but often non-tariff barriers and campaigns against foreign companies and foreign interests have proved very effective and painful. for instance, there are multiple south korean industries stilling reeling from 3 and 4-year-old non-tariff trade disputes from authorities and being quite problem make the for those companies in the largest growth market in the world. >> david, just want to go to one company that you flagged as potentially being at risk which would be starbucks, and it's interesting because so far it's been kind of insulated, and i think there's been an assumption that the chinese authorities would be loathe to kind of clamp down on anything that their own consumers would feel it's a luxury and kind of aspiring to a better life-style. do you see this at risk in its whole trade fight?

>> anything that the chinese think that they can or may do on their own, they may favor those internal or local or indigenous national champions in the long term the china wants to see china be successful they don't necessarily want to see u.s. companies be successful to navigate china well, you have to look for companies, as you do in all investing real, that have stateable really strong competitive advantages, and at the end of the day, you know, chinese people could get caught up for anything. nothing sustainable about making coffee or making phones or the glass for corning. it's about businesses that can compete with china because at the end of the day we're competing with them and their internal national champions whom they will favor a great deal as much as they can when the chips are down. >> we'll see what happens this weekend. guys, thank you, for weighing in on the stock market impact.

>> coming up, we'll look to see if this rally is real or a head mke for theart. mike santoli at the telestrator coming up. obvious. sometimes, they just drop in. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities. cme group - how the world advances.

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whai tell clients, etfs can follow an index, but which ones target your goals? it's not about quantity. it's about quality. no trendy stuff. i want etfs backed by research. is it built for the long-term? my reputation depends on it. flexshares etfs are designed and managed around investor objectives. so you can advise with confidence. before investing, consider the fund's investment objectives, risks, charges and expenses. go to flexshares.com for a prospectus containing this information. read it carefully. welcome back let's take a look at how we finished the day on wall street. s&p up 2.3% and the nasdaq led the way, um nearly 3%, but all sectors apart from utilities participated and all sizes of companies as well.

the russell was up 2.5%. time now for a broader cnbc update with sue herera. >> hello, wilf, thank you. here's what's happening at this hour challenges ahead for nancy pelosi house democrats voted 203-32 in a closed door session for her to be house speaker, but she will need more support to survive a full floor vote early next year. she will need 218 votes if all republicans vote against her as it likely. the white house did not block cia director gena haspel for briefing in the senate about the war in yemen, the yay spokesman saying the notion that anyone told her not to attend was ridiculous however, many senators couldn't understand why she wasn't there for the briefing. >> not having gina haspel is a

cover-up to the critical questions that the members of the senate have in the murder of jamal khashoggi and a question on the u.s./saudi relationships. >> that's the update i'll send it back down to you. >> sue, thank you. the s&p 500 had a rally, the second best day so far this year and many investors are wondering whether the market can sustain it mike santoli watching the levels on the s&p to see if there could be a pullback on the horizon. >> yeah. i think it's a little too early to say we're prime for a pullback this was an impressive day you definitely overcame some of the doubt. it's about the ability of the market to sustain a real, and i want to talk about where we've been so far this year. year to date, two lines drawn, 2750 and closed today at 2743. this is the last few days. that's a nice sharp real, good

angle. really makes this look like they built a little bit of a base, and wilf will not like that. i do want to point out a couple of things in this zone how many times the market has stalled out there, one, two, this whole phase right here, three, four, so four times this year when we basically got up into this general area it's been a reason for the market to pause. still not there. i still think 2800 is a place that you can kind of look towards right here these aren't magic levels. saying that's a great-looking rally and weren't these as well? it stock you a while to take those higher seasonal values. >> i tried to stand there the last couple of weeks very tricky, your drawings. >> don't patronize me, wilf. >> we get the point that we're not at the key level of 2800. >> yeah, i don't even know that that's a level where it's seemed

very obvious that the market has taken a pause at least no, we're not there yet. >> i always enjoy the telestrators. >> always. >> the charts are always very insightful the drawing is tricky. it's the insight that matters. >> stocks rallying after fed chair powell says rates are neutral. could inflation concerns force the fed to keep raising rates. >> later, find out why facebook is sitting out today's rally despite a nearly 3% iny e ga bth tech sector as large

fed chair jay powell moving the market today after speaking about fed policy at the economic club of new york here's what he said. >> we know that moving too fast would risk shortening the expansion. we also know that moving too slowly, keeping interest rates too low for too long, could risk other distortions in the form of hire inflation or destabilizing financial imbalances our path of gradual increases has been designed to balance these two risks, both of which we must take seriously >> is that the right plan of action joining us now to discuss is

jason furman, former chair of the white house council of economic advisers and has an op-ed in "the wall street journal. the case for pausing the interest rate climb and also with us, fred mishkin who says the fed should stay the course and keep hiking, a very good afternoon to you both. jason, if i start with you, clearly slightly dovish set of comments from jerome powell today. were they dovish enough for you, and do you think they will still hike in december >> you know, i think they will probably hike in december. i don't think they should. you know, he's right about the balance, but the market is helping them to get to that balance already. the market has tightened the global economy is slowing. inflation is only 1.6% the core cpi in the last three months i think they should take a break and i don't think it's a disaster if they don't do that, but certainly next year they really need to slow down the pace of those increases. >> rick, you totally disagree.

why? >> well, i don't want to say totally but issue here is we need to see the way the data evolves, and we can't be complacent we're running a very high pressure economy right now that -- that inflation has come back up. it's still at a very good number for us and not too high, but, on the other hand, we're running at full employment and possibly more than full employment we haven't had labor markets like this for a very, very long time, and the problem is that things can start to spin out of control. this happened in the 1960s this could possibly happen again. that doesn't mean it will, but i think that the real thing that we have to look at right now is that the federal reserve still is really not quite at neutral in terms of where the interest rates are, so with an economy that's growing very rapidly, with, you know, very shrill slack in the economy, that there is a danger that inflation could get high, so i think the good news is that the ned is doing

exactly the right thing by saying we no longer have a commitment to particular policy paths and have to look at what the data is. complacency is very dangerous right now. the fed could be in a difficult situation where inflation could be a problem. >> jason, do you find the concept of a neutral rate useful in that context and what can you say about how we estimate it, that you know it when you get to it because the economy close down. >> yeah, i think that the neutral rate is almost a whole lot more than it was 10 or 20 years ago, and you saw it lower before the crisis. it's not something that the central banks have caused. it's a reality that was imposed on them. i don't think minknows where it is we're probably below neutral but i'm not sure right now i think we're more likely above full employment than below, by think that's fine.

there's a lot of repairing in the labor market that we need to do making up for those many, many years below full employment and running a bit extra hot is an experiment, you know, i think that's an experiment worth trying. >> sounds like a bottom line in this debate and all sorts of opinion on wall street and it sounds like the market may be telling a different story than the data which means are we overheating or are we cooling down if you think inflation is pick up, how do you read the housing numbers, another bad number that we got on new home sales, what's happening in the auto sector some of the signs in the semiconductor market and prices and put all together and paint a pick tour of an economy that doesn't look like it's overheating. >> well, it depends what you mean the growth is going to be slowing down from 3%, it's not sustainable, so that's something that we expect to happen, but the key point is even with growth slow from 3%, we're still expected to have the

unemployment rail fall, and we are in territory where sometimes inflation can get out of control, so i think that the issue here is that we have to be very cognizant of what the numbers are doing and not take a strong stance. i think the fed actually doing some further rises in interest rates makes sense given the strength of the economy, and so i don't see that the economy is showing weak numbers just basically can't be roaring along at this 3% rate when in fact the growth of potential gdp is actually much lower than that that's just the reality of this situation right now. >> jason, how real is the threat of a global slowdown outside of the u.s., infecting the u.s. growth outlook next year and giving that in london and the uk there's still brexit on the horizon. >> i agree with rick most of what we're seeing is an economy moving towards a more normal growth rate

i'm not panicked by the growth slowdown in the united states. we're going to be growing in a year or two from now we'd be happy with a 1.75%growth rate. that's about what our potential is set of downside risks, brexit is one of them but u.s. trade wars, but i don't think that should be the central concern of monetary policy, but its central concern is data dependant, and if in september you thought you wanted one more hike this year, the markets already did that hike. the long-term rate is up, the dollar is up and the stock market is down we just don't need the hike that back in september it seemed like we need and it's already been done and i think there's a gentle titration exercise, but not a panic of warding off a slowdown. >> all right guys, i think we'll be talking a lot more about what the data is telling us for a data dependant fed. thanks for joining us today.

>> it's a good debate. i need to know which one of those guys is taller though to give the nod. >> who you get credit forks one of them was on the fed. the nasdaq climb more than 2% today while facebook climbed 1% we'll talk about the social media's underperformance next. >> the twitter poll asking who will be the better fed chief, me at 6'5" or sara at 5'3". >> so ridiculous. >> go online i need the help. i'm trailing >> you know why? >> because based on height is the a ridiculous concept. >> oh, is it, thanks i've been thinking all day since the president tweeted that that was the case back in a couple of minutes. chasing after short-term returns? instead if getting caught up with the crowd, the investment managers at pgim take a long term view. uncovering opportunities for alpha across public and private markets, while anticipating unforeseen risk,

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the platform, price and service that gives you the edge you need. looks like we have a couple seconds left. let's do some card twirling twirling cards e*trade. the original place to invest online. welcome back stocks rallying today, but one notable name lagging behind, facebook climbing more than 1% today but, therefore, still an underperformer julia boorstin with why social media, the facebook stock in particular, is underperforming julia? >> reporter: facebook finished the day higher, but it fell as much as 2% earlier today, this after a senate hearing on ftc oversight in which it highlighted the growing specter of both antitrust and privacy regulation democratic senator richard blumenthal, who is working with republican senator jerry moran on federal privacy regulation, warning facebook and google that it's not just privacy regulation that they should be watching

>> big tech maybe is no longer entitled to be as big as it is misuse of bigness can be in violation of antitrust laws. >> there's no update from the ftc on its investigation into facebook's handling of cambridge analytica, but there's speculation that they could fine facebook well over $1 billion. this is one of the many issues weighing on facebook the hearing on disinformation and fake news in the uk grilled a facebook executive in london yesterday, says he plans to release internal facebook documents he seized as part of an investigation into the company. also yesterday, a former facebook employee posted on the social network that the company has a, quote, black people problem due to its lack of diversity, and sheryl sandberg is going on an apology tour talking to one of the groups that was targeted by the d.c.-based consulting firm that

facebook recently fired. >> julia boorstin for us in los angeles. meantime, a report on tribune media. >> stock up 6% as apollo is leading a byrd for the company to buy out the company with northwest broadcasting so you can see it there apollo and northwest broadcasting look to buy tribune media according to a reuters report that just came out. still to come, news on apple as they defend one of its iphone models those details after the break. see that's funny, i thought you traded options. i'm not really a wall street guy. what's the hesitation? eh, it just feels too complicated, you know? well sure, at first, but jj can help you with that. jj, will you break it down for this gentleman?

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wove got a news alert on apple. eric chemi with the details. >> sarah, apple telling c nabz

nbc that the xr modland or the xr is best selling iphone since the launch in mid-september. this as they said they would discontinue sales figures in the earnings report. there was analyst speculation about the weakness of the phone and if they have to reduce the guidance based on the sales figureses. that's what apple is telling cnbc this afternoon. >> eric, thank you very much that 3.85% move today. xr is the cheaper model. >> yeah. >> i guess you would rather have the more expensive model. >> that would be expected. >> from apple's perspective they think it validates the strategy of introducing a lower priced phone at the same time you can never know how many buyers of the phone would have been paying 200 or $300 more. >> the story of the narrative since the quarter has been around demand for iphones, is it

weakens what is the fact that they don't want to talk about the shipments about? does this provide clarity. >> i don't think it does it's impressionistic best selling phone every day did we think it was not the case it's more muddle i don't think apple had the real expectation they were getting out of the trap of always having to kind of address the volume demands. but here they are. >> we will watch apple shares moving a little in the after market a little higher. we asked and you told us who would be the better fed chief me or wilfred obviously well you know the answer excuse me two minutes left i need a late surge. >> height and iq. >> you're saying you have a higher iq. is is a different debate. >>t'not a valid basis. >> we're back in two is the fund built to sell or built to last? etfs are only part of a portfolio. so make it easy to explain. give me a quality fund

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we don't stand often on the show but at the top of the hour we highlight add quote from the "washington post" interview wit president trump, where the post was reporting that president trump did not choosejanet yellen to continue on as fed chair because she wasn't tall enough to lead.

>> which we know is a silly reason we took it and ran with it we took to twitter and asked you who you thought would make a better fed chair me at 6'5". and sarah 5'3". >> they don't go with the president that height matters with fed chair it's brain power. >> oh. a few points to make in my defense i think our viewers they know that legally i'm not allowed to be the fed chair. 37% that's remarkable. >> i think that's not the question it's who would make a better fed chair. >> who is nominates. >> that is annoying and another damns factor for the result. >> mike santoli. -- i want the definitive. >> i think in the extremes i think in the middle somewhere there is a height that might be optimal. man alan green span.

>> my favorite is mario droggi five 1'1". i don't know how call mr. corodo but 5'9". >> i do know toll powell is taller it's not working out well for him with the president. >> also this economy doesn't seem like it's the rates would be extreme. >> it's better i stand out of the race that's the only reason why this came together. >> bottom line powell is the biggest factor behind the rally today. the dow soaring 600 points. >> i also don't have my heels on but i continue, mike especially into the xi meeting. >> the market? in a better spot the action today tells you last week a probably lo process i don't think we are going up 2.5% a day but it was compressed enough that it needed softening of language from jay powell that's

impressive. >> another potential for a boost if we get trade positivity. >> i think it has more chance of a surprise on the negative side. they want the g20 out of the zbla we also get fed minutes tomorrow. >> and enough for "closing bell." thanks for watching. >> "fast money" starts now. "fast money" starts right now. riff from the nasdaq market site over looking new york city's times square trades it pete harjen. steve grasso and guy adami tonight on fastest everything is awesome. according to the federal reserve. jerome powell sparking a epic rally after pacifying concerns, the dow surging 600 points the s&p jumping 2% the nasdaq up a whopping 3%. and jonathan golub who was there will tell us why the market is going higher