now it is up five bucks. david: herbalife kicking back to life. >> up almost 40% in 52 weeks. there is buyout talks. we'll see what happens. [closing bell ringing] david: charlie gasparino keeping us abreast of that of. bells are ringing on wall street. we have all negatives of the we were flirting with at least one of those indexes in the positive. that would have been the dow but towards the last half hour of trading it lost the steam there, despite not withstanding caterpillar earnings which continue to be very good. that stock is up over 5%. all of the indices are down. look at nasdaq down. small and mid-sized caps, cheryl, very much like emerging markets. they're getting hurt bad. cheryl: really quick to the point, david. talking about low volume. that would explain incredible volatility we had. vix hitting highs not seen since october. volume story. david. thanks. front page headlines for you. economic news coming in as well. new home sales dropped more than

expected last month falling 7% to an annual rate of 414,000 units. one reason for the decline, the cold-snap hitting the northeast. did you hear about it? david: keeps getting snappier. earnings reports beat wall street estimates and unveiled better than forecast preliminary profit outlook. cheryl: united technology considering strategic options for the sikorsky unit which makes black hawk helicopters. options for sikorsky include a sale, spin-off or a merger. david: john mall lien, the media mowing gel -- mogul we all love will buy the dutch company, zig go. -- ziggo. the deal is worth $9 billion. cheryl: expect laptop shipments to fall 1.3 million units partly because of a growing trend of tap r tablets with big screen devices including a new device

from apple. david: when will we get the device? ford is claiming the ford focus compact is top selling number. basing numbers on rl polk. toyota will probably be challenging ford's analysis. it has done that before. "after the bell" starts right now. cheryl: break down today's action, david. loomis sayles and company equity portfolio manager says we're overdue for a market correction. scott bauer is in the pits of the cme. let's start really with scott. i do want to pick up if we don't mind, scott, with the volatility issue today. what is your take on what we're seeing? >> i think today was actually a real good thing for the market. we didn't really see a big follow-through from last week. we had this humongous, humongous down day on friday. tremendous volatility. vix up over 40%. follow-through over the weekend

overseas. this morning we were up a little bit, down a little bit, pretty much around the flat line all day. we saw the vix trade in a range all the way up to the high 18s and down almost to 17. what is really interesting, guys i was on a little over a week ago and we talked about the volatility of the vix, right? this is week ago friday. even though the vix was trading 12 the volatility of the vix was trending higher. that to me was a signal that uh-oh, there is caution in the winds. maybe something is going on here. now that has stablized. the volatility of the vix has stablized. i'm not saying this selloff is over by any means but i will tell you things were really calm today. things were almost back to normal. like you said a few minutes ago, david. volume was pretty light. i think that is a really good thing following up what happened at the end of last week. david: they're waiting for what the fed decides and the fed is coming out with its decision on wednesday. david, we had a guy from the

stock almanac talking about the january barometer. it has been right 85% of the time in the history of the stock market. you really take that january barometer seriously. tell us about it. >> well, ultimately fundamentals will matter. what are earnings doing? revenue growth? what valuation are stocks selling at. you can not ignore the track record of the january barometer. here we with just a few days to go in january, stocks are down, 3, 4% year-to-date. it is rare that stocks are down in january and they are still up for the calendar year. 2009 is the most recent example where the market rallied after its pitiful start to the year. let's at least acknowledge it but i'll still waiver in and say fundamentals. what stocks are trading at on a p-e basis. earnings and sales, so far so good. better than expected for fourth quarter numbers and just simply that companies are much smarter deploying their capital and their use of cash.

i think that will ultimately prevail 242014 but very nervous about that january barometer. cheryl: talk about things to do here. let's bring in joel johnson. he has three ways to play the volatile market. i do want to ask you overall are you changing allocation strategy now, joel, that we're frankly looking what has been a down day? we had five down sessions here in a row. does this tell you pull back on equities or jump higher into equities? >> no. i think the market is definitely under pressure the uptrend has definitely been broken here. even though we're not short-term market prognosticators if you will, we believe there will be a lot of volatility going forward. we can't have four tremendous years without some pullback, i think the market may have gotten ahead of itself. our allocation is 60-mix, 40% high yield bonds. not industrial grade. >> that is pretty aggressive mix.

not for our clients. not for our clients. our clients are three to five-year investors. we're not traders at our firm. david: david, let me talk about one stock in particular, we've seen a pull back last couple years. that happened and has been up recently, you have the conviction of something like carl icahn. he's buying more shares. just bought another 500 million-dollar tranche of apple stock last week. that is what he told our charlie gasparino. you like qualcomm which is a way of playing apple. why not go directly into apple itself? >> better market share at qualcomm simply put. while apple sells at a more discounted valuation to qualcomm at 14 to 15 p-e ratio on this year's realistic earnings estimates, favorable cash flow growth, growing the dividend in excess of 30% -- david: let me stop you there. forgive me for interrupting. apple's pe is 11. doesn't that sound more inviting?

>> not in the case of if you just simply look at pe. yes, apple looks compelling, if you look at market share qualcomm controls and they sell to everybody, not just apple i think that's what makes qualcomm more compelling as a tech stock. it is not a vote against apple. it is more of a vote in favor of qualcomm. david: gotcha. cheryl: scott bauer, certainly a lot to watch. apple is a stock to watch. 20 minutes or so we get the report. what if the guidance isn't that strong from a company like apple? what if guidance trends to the downside for many companies, what do you say? >> well you're going to have big players come into the marketplace around the 520 level if we see numbers that aren't so great. the market is pricing in, the option market is pricing in a 6% move which on the downside brings it to the 520 level which is some major support. hedge funds, big funds will be licking their chops. it will be like almost charity work trying to buy the stock at

520. if it can't hold there, look out below! my guess there is so much money on the sidelines waiting to get in apple, we would see at least a short-term support area right there. now, outside of that, december numbers are really important. if we get decent guidance, revenues around that 46, $47 billion number next quarter i think you will see the stock pop, maybe not 6%. think you see it pop 2 to 3% on upside. david: joel, we have queasiness what is happening to the stock market in general but look at the numbers caterpillar came out with, really strong numbers. the stock all of the dow benefiting because it is such a big component of the dow. is there hope that the world economy will grow stronger despite bad numbers from china? doesn't that give you hope what caterpillar did today. >> well it does and i like to look at big companies like caterpillar, ford, united technologies these big industrial companies that sell

big-ticket items to other businesses and we're very encouraged by what we see from caterpillar that is the kind of stocks we like. we're not necessarily buyers of caterpillar but big blue chip dividend-paying stocks because most of our clients are individuals who are interested in decent, you know, rate of returns, david but not necessarily the trading type of mentality. if we own a big stock that pays a nice dividend, pays us to own it we like that. i was very encouraged by caterpillar's earnings. cheryl: joel, thank you for being here. david sowerby as well. scott bauer, we'll check in a few minutes for s&p futures close. david: it will be a busy day. we're about to cover apple. it will be announcing its earnings about 20 minutes from now. iphone, ipad and of course died kahn, the big three is as apple gets set to release earnings. we'll go behind the numbers to tell you whether now is the right time to jump in like icahn. cheryl: there is an i in apple? what? we're watching this for you,

polar vortex 2.0. dangerously cold temperatures hitting parts of the country, forcing school closures, flight cancellations, how bad is it? we'll get the latest for you. david: a lot of reason why the volume wasn't so heavy today, they're waiting on this guy. it is his last meeting. the fed starts its two-day meeting. will the recent market downturn put tapering on hold? how closely is mr. bernanke and rest of them following the market? do they take their clues from the market? we want you to tweet us at fbn-atb. your answers later this hour. ♪ [ male announcer ] what if a small company

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cheryl: lululemon shares sinking into the red falling to the lowest level in three years. let head back to nicole petallides on floor of the new york stock exchange. more lulu news. >> more lulu news. we've watched lulu run to the highs, these 100 plus dollar pants did so well so long, yoga maker act lettic wear. they were plagued by so many pr problems and whether or not they were really worth it. guess what? they have intense competition from the gap. the gap's line happens to be opening more and more stores.

the analyst at january any capital expects that they are going to open stores at the rate of 40 to 50 a year for next several years. as a result what they're doing they're actually cutting lululemon. they don't think it's a buy any longer. as a matter of fact we launched lululemon dealing dealing with everything with pants too sheer and tough talk from the ceo. so they have had to really battle this out and get the stock back on board. the stock hit a new low today, annual low of 54.54. in over 52 weeks, it is down over 30%, clearly underperforming the major averages. back to you. cheryl: well at least gap is doing something well with athleta. david: s&p futures closing right now. 30 seconds from now. let's go back to scott bauer. what does it look like from the close, scott? still selling? >> no. traders are flattening out the

positions. if anything they lean ad little long because they cover themselves optionwise because volatility was cheap. volatility is expensive. they see nothing but flat positions. they don't want any position ahead of wednesday's comments from bernanke. david: tomorrow, tonight they case themselves in concrete and break out of that shell on wednesday. we, scott because, thank you very much. cheryl: thank you, scott. whoever said that the polar vortex was once in a lifetime event was completely wrong. the chicago and the midwest and chicago area and midwest are experiencing worse weather than they did even two weeks ago. david: it's a cold winter, let's face it. we go through these every now and then. temperatures in chicago expected to remain below 30 degrees many cases below zero forcing schools to close. jeff flock with the latest on the frigid weather. has it gotten above zero yet there? >> no, no it has not. it is getting very old to be

very frank and honest with you, ladies and gentlemen. the snow, not just the cold but is snow. look at this pile of snow here. this is millennium park. look how high the snow gets. cheese and crackers up here. this is what we're dealing with this year in chicago. extraordinary. here are the headlines. you talked about the schools being close. well, that is coming too. the worst is yet to come. it will only be colder tonight than it is now. schools will close for a second day tomorrow. windchill advisory, we'll have that all day tomorrow. all night tonight. into wednesday morning, with the windchill advisory and flights canceled and delayed at o'hare and midway airports. actually all across the midwest. look at numbers, the latest flight cancellation and delay numbers. that is not pretty either out there. we've got some pictures also. i think down along the lakefront, we spent part of the day out there. that arctic sea smoke, we rarely

see in chicago actually in evidence in lake michigan as this cold air came in. and headline, tomorrow, is this is going to reach even farther to the south, all the way down to like new orleans. all the way from the texas coast to the carolinas. going to be in the teeth of it tomorrow. i think buy natural gas you think. especially may be a buying opportunity today. natural gas hit a 43-month high. sold off a little bit today. i don't know. this cold weather, every time we think it is going away, they pulls us back in. david: great segue. we do have a segment on natural gas, now is the time to buy. by the way, 20 bucks, jeff if you stick your tongue to the metal pole behind you. cheryl: don't do it, jeff, no! david: all right. cheryl: thank you, jeff. very lonely, i don't think i ever seen the streets of chicago

so empty as i have today. david: pretty hardy there, even chicagoans are pushed away. with mercury plummeting all over, today's big selloff in natural gas is down 5%, is it the right time to get in. >> we'll bring you the gameplan if you're interested in natural gas coming next. cheryl: we're minutes away from apple's big reveal. tim cook's hotly-anticipated earnings report. will he be the toast of wall street or will an icahn be mentioned in the conference call? we'll find out in just a few moments. ♪ announcer: where can an investor

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cheryl: time for a quick speed read of today's headlines, five stories one minute. google reportedly paying $400 million for the company. new survey from the national association of business economics shows that companies expect to perform better this year but do not plan to hire more workers. of 64 members surveyed, 43% expect their firms to raise selling prices, highest percentage in more than a year. at&t does not intend to make an over for britain's vodafone group. the offer coming after months of speculation in the telecom industry about a potentially massive takeover deal. first-class stamps costing 3 cents more today. the price hike will help the u.s. postal service recoup

billions of dollars it lost in the downturn. largest rise in 11 years. 10-day royal caribbean cruise ship will return early after an outbreak of illness. 540 passengers and crewmembers reported being sick. that is today's "speed read." i can mess up because i have four seconds left. [buzzer] david: i bought all the forever stamps. cheryl: i need more. david: talk about natural gas. it saw a big pullback today after it jumped 9.6% on friday. last week it gained almost 20%. major winter storms of course brought freezing cold temperatures to much of the northeast. that caused inventories to fall. so is today's big pullback a good time to get in? john laforge, davis research commodity strategist and our very own sandra smith. good to see you both. john, i want to go to you first. the pull back today, is now the time to get in? was it profit-taking or what is

going on? >> i wouldn't get in. natural gas is condition one of our favorite commodities in 2014. expect a pull back. wait for 4.50 before i get in. david: what about that, sandy. >> i've been digging through all the research. it is not just where the storage levels are today, which is about 13% below the five-year average so where they will be next year. citigroup put out a note saying natural gas prices could go to $15 per btu. that would be three times where they are today based on storage levels at end of this season, they are saying they could be uncomfortably low for next season that would be a big factor. david: john, talk about supply, huge natural gas explosion, one. pipelines in canada. that was in winnipeg, canada, will that slow up the supply at all? >> short term, like a weather-related event. so it could but i really shy away from weather-related events. i wouldn't short nat-gas. general theory in commodity land

don't short a weather-related event. long term we have have a lot of supply. i understand short term production numbers. production could come on pretty quickly. i wouldn't worry about next year seeing 15. that seems like an extreme case to me. we have a lot of natural gas in the u.s. and that supply can come on pretty quickly. david: but we also have the question of demand, john. i know a lost real estate agents i talk to who say that they can't house that is don't have natural gases. if a house does have natural gas, a much older house, it is much easytory sell. is demand pushing natural gas right right now? >> it a absolutely is. we demand in the u.s. 71 billion cubic feet. we produce 67. the difference comes roughly out of storage. we have plenty of demand, the issue is right now weather-related storage as we said earlier. but the big issue is production. year-over-year it is flat. you look at oil production, it is up 16% year-over-year.

everyone knows about the story of all the oil we found. gas production has come down but that doesn't mean we can't increase it and next year you could easily see the flat production of nat-gas move up 16, 17% where oil is today. so we like it long term. in fact it is one of our longer term plays, three to five years. we really like natural gas. bucks here for it. david: sandy, there is question of about power plants. the obama administration doesn't like coal. they have been killing a lot of coal projects in terms of some of the mines on the back end. what's going to happen? is there enough of a switch from coal powered plants to natural gas powered plants to meet supply. >> hedge funds love natural gas. they have been accumulating long positions in natural gas for quite some time. i was looking at latest cftc report there long position. big bet is we'll consume more. don't forget about the export story. barclays is predicting we'll be

net exporters of natural gas by 2016. that is -- david: what will that do to the price. >> that should drive it up. less natural gas for us to consume at home. that is going overseas and that will push prices higher. one other thing, to take it in the bears defense, david, exploration and production companies right now are trying to lock prices in right where they are today. so they're betting prices are going to fall. david: john, very quickly, how do we buy natural gas? may not be at price level now to buy in, would you get ung or what? >> not ung because it plays the curve. much more interested in something like fcg. or individual stocks. something natural gas heavy. chesapeake is natural gas heavy. i would be definitely long the e&p names longer term. be worried about the next couple weeks. these are weather-related events. they don't last very long typically. they pull back and there is opportunity. david: sandy, do you agree. >> big storage report on thursday. market will watch that. >> watch thursday, gang.

john laforge, sandy smith, good stuff. appreciate it. cheryl? >> thanks. cheryl: we're eagerly awaiting apple's earnings report that will be released in a few minutes. we have a all-star panel to break down the numbers. that will be next. plus it is a scary selloff in the world's emerging market last week. wait until you hear what buying opportunities are still out there for investors overseas. those litt things still get you.

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david: okay. apple numbers are just out right now. we are getting numbers. looks like a slight beat on both bottom and top line and after-hours though, we do see a drop in the stock value. quite a bit. it ended the day at $550. looks like it is trading at $529. cheryl: they generated 22.7 billion in cash flow from operations in the first quarter. pretty strong. david: dennis kneale is looking a the numbers. dennis, what have you got? >> we have a nice beat on both or at least a little bit after beat after growth concerns at apple. we have earnings $14.50 a share. wall street was looking for $14.07. a nice little bid. up more than 2% from the 13.81 a year ago. revenue also a beat. $56.7 billion. wall street was looking for a little less, $56.4 billion. growth is back at apple. we'll see what they did on iphone. that is a key number. david: by the way, their ipad

numbers are a little disappointing. some estimates at 27.5 million of ipads. actually sold 26 million. that is loss in terms of unit sales. we're waiting for unit sales of iphones. cheryl? >> mac sales look better. mac has been one of the biggest problems for the company. that has been sliding. 4.1 million a year ago on mac but now it is 4.8 million. that looks a little better there. >> sure. apple, macintosh doesn't almost matter anymore. it is iphones, 51 million sales in the quarter. all-time record. just got in my ear from one of our producers. remember this is the first full quarter where you've got the iphone 5s and the 5-c. in the current quarter -- in middle of something. current quarter they're also -- david: unit sales, dennis. calm down. unit sales of. >> i was in the middle of something. david: 51 million is what they have but they were expecting as much as 58.5 million.

that is what we needed to get in there. that may be one reason why we see the stock slide. go ahead, dennis. >> all-time record of 51 million. it is first quarter with 5 s and 5c. china kicks in this current quarter which is why people are thinking the current quarter which is usually a weak one for apple could actually surprise to the upside because of china. david: again, you see the market slide. that is what is happening right now. probably on the fact, go to mark spooner, "laptop" magazine. mark, is probably some people were expecting 58.5 million in unit sales and 51 million is quite a loss in terms of expectations. mark, are you there? >> keep in mind where apple was a year ago. so they were at 47 million. going up to 51 is a nice little bump but not as much given they had two new devices and they're pushing into china. we might not see the fruits of that labor until the next quarter.

mark, real quick, i want to ask you about the dividend. one of the things that carl icahn is so -- return to shareholders, $305 for a cash dividend. the copies giving back a little to shareholders -- $3.05. how much times carl icahn's name comes up. is this number you want to see. will this give carl icahn a moment to pause in your opinion? >> perhaps. think about how much cash they're sitting on at 141 million, billion. they wanted to see action with that, whether repurchasing the stock or reinvesting in some startups. apple has been more conservative than some competitors to investing in the future and they tend to pick off smaller companies and figure out ways to do something with them like siri. i like to see them get a little bit more aggressive in 2014 especially with google purchasing artificial intelligence company and making big moves there i would like them to make a splash in terms of jump-starting innovation. david: go to tom forte, telsey

advisory group. i saw your estimate. you were expecting unit sales of the iphone, 58.5 million. it came in at 51 million s that why we're seeing the stock slide after hours? >> you know, i would have to agree with that assessment. look at numbers and revenue better than expected, i think that suggests to me that they had stronger sales of the higher-priced 5s where the 5 consider was likely weaker. which is why you would have less than expected units sold but greater than expected revenue. i also thought the ipad number was a little on the light side as well. so i do think unsales for both iphone and ipad, when you look at guidance for the next quarter, 44 to 42 billion revenue versus consensus number of 46 billion, that is why you're seeing the stock under pressure. cheryl: it was guidance. i was about to ask you for guidance next fiscal quarter. you think that is where the issue going on with the stock action after-hours. there is pressure.

gross margin between 37 and 38% and operating expenses 4.3 billion to 4.4 billion. is it just the revenue guidance that you're focusing on or is there other factors involved? >> i mean there are other factors but i think primarily the revenue, 44 -- 42 to 44 billion versus 46. in the past apple was incredibly conservative when they gave guidance. last couple quarters they tried to be more what they call realistic. yes the quarter revenue was better than expected but unit sales on the iphone is on lower side but really iphones drive the stock. david: they might want to rethink the new strategy, tom? not working so well today, their lowered guidance that is? >> yeah. sure the guidance there is nothing wrong with the way that they're giving guidance. i think the marquardter as someone indicated before will be stronger than it should be because of the china mobile agreement. the question is, what are they going to do late they are year? refinements they will make to

the smartphone to hopefully result in some higher unit sales? cheryl: you know, mark, i'm looking at the, again, ipad revenues for the first quarter, $11.5 billion, certainly, mark, that is good to see. many are forecasting and discussing for the future we'll get ipad pro. the concern the ipad, they're going to eat into the margins of each product. do you think that is concern with revenue we are seeing revenue for ipad in the first quarter no. >> not necessarily. i do think i think as phone screen sizes increase, that could be a concern latter half of the year. rumor that the iphone 6 is going to have a five inch display. there has been pressure on other manufacturers, when it comes to tablet sales as the so-called fablets are coming to market. there is less concern of getting a tablet with a big screen phone.

they could have lot more wins in the enterprise and potentially put more pressure on microsoft and windows 8. david: let me go back to tom and talk about carl icahn for a second. we got news in charlie gasparino's conversation with icon last week he just bought $500 million worth of the stock. according to my calculations, the stock is down now about 4.5%. that means he had about a 20 million-dollar paper loss today. how soon will it take to get that back? >> i think he has done reasonably well since he made his first investment and i'm confident the stock will do well over next 12 months and carl icahn will be more than fine. david: now you have a $650 price target on the stock. did today's unit sales numbers worry you perhaps it won't get up to that? >> again, i think when you look at sales better than expected but iphones units being weaker the question is the problem the 5c, not the 5s? if the come is the not the 5c

but the 5s? the 5s will have robert marr begins. i think if they do enterprise tablet that would be great for margins standpoint. cheryl: the stock again in after-hours trade something down. about 521 and change. i had an analyst on earlier say, 520 is the sweet spot if you're looking to buy shares of apple, tom. would you add to your positions at this point. >> yeah. i think our core thesis on the next 12 months is okay to the extent that the december quarter i think was the full quarter of the 5s and 5c i would like full details how each performed. and china mobile agreement. second half of fiscal' 14 iwatch, television, something new additive to the top and bottom line. david: mark, what about the iphone 6, what have you heard about that? >> in addition to having a bigger screen there is rumor they will use sapphire crystal display that might have solar

cells embedded would allow to you do solar charging. i think also going to be having that bigger display in general. a lot of people who are buying and scooping up android devices like samsung because they want to have the extra real estate. there are some enhancements coming to the camera. despite the fact nokia is out there with a 41 megapixel camera, we put them head to head, and apple still won. a lot of people care about the mem riffs and i sigh apple pushing that. cheryl: dennis kneale in the newsroom. you have more details you want to bring in. >> looking for silver linings here. it ain't over for apple. the ipad faces stiffer competition from ever before really. amazon came up killing it in the ads kindle hd is better. sold million more extra ipads. 26 million. wall street looking for 24.88 million. that is over an additional extra million of ipads at a time they have been under relentless pressure from amazon and the

kindle. david: headline is what you're looking at on your screen, which is a big loss after-hours. we're seeing a drop of almost 5% after-hours as a result of a miss on unit sales. that is the best that we can figure out why the stock is dropping right now. we had estimates from tom forte of 58.5 million for iphone unit sales. only got 51 billion. also a loss on. ipad in terms of that those unit sales. apparently that is moving market. cheryl: you're absolutely right. well behind what the street was looking for. tom, mark, dennis thank you. david: thank you, folks. cheryl: ugly world in emerging markets. where is the smart money going and could all the turmoil create buying opportunities for investors overseas? david: we'll see.

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the risk of stroke with pradaxa. cheryl: emerging markets rock the investors in emerging markets countries.

investors pulled 2.4 billion from emerging markets funds largest outflow in five weeks and 13thk of withdrawals. david: are the markets facing even deeper crisis? we have mark field asset management chairman and ceo. good to see you, michael. thank you. >> good evening. david: conventional wisdom is not always right and in fact often wrong but fed tapering is leading edge of falling emerging marketings. you say that is bunk, why? >> that is not true. we haven't started tapering yet and just about started tapering. em is underperforming over two years and simplest thing is. u.s. bond market has been rallying over last couple days while em is selling off. this is being driven by i say domestic incompetence within the emerging market complex. cheryl: you're saying in other countries? >> yes. cheryl: what you think the fall is, and emerging markets have been a strong bet until the last two years because of growth in

these economies especially population growth. >> but population growth doesn't really help. what you really had in the end was a really good economic cycle which turned into a less healthy cycle 2009-10, very much fueled by credit. you have started to unwind that on a country by country basis. i think we're in the middle of 2/3 of the way through really messing unwinded. international investors u.s. and elsewhere are very resistant that the story is over. that is typical after real bear market. david: you said in confidence. i assume what you mean, people like the president of argentina who has made a mess of things in terms of export market and taxes, et cetera. hugo chavez's legacy in venezuela, new leader in brazil is that the kind of incompetence you're talking about. >> and central banking. most central banks in emerging markets, not all but most of them have had faulty monetary policy. david: what have they been doing wrong? >> they responded to the u.s.

slowdown and euro crisis by massively expanding money supply. they allowed a credit cycle to get out of control and they have been struggling ever since. cheryl: we know investors could pick specific regions and avoid others. give me something you're bullish on? >> if you told me i had to be em, be in parts of em linked to the developed economies. we're bullish about developed economies, u.s. and japan. mexico is tied to us here. eastern europe ex-russia tied to the strong domestic german economy. eastern europe it is in asia and probably south korea. probably south korea is okay. david: we talked about the devaluations of currency in argentina, venezuela. so forth. there's a danger of competitive devaluations what they used to call beggar thy neighbor. if you make the currency cheaper it helps your export market. will we see sort after devaluation war? >> more a danger of contagion.

i don't think this is orderly and planned discounting of currencies. south african rand is down 60% last three years. i don't think they deliberately had happen. turkish lira is down 50%. they clearly didn't do that because they have emergency meeting. there is danger of '97, '98 type run of investor run on emerging market currencies. that is not competitive devaluation. cheryl: michael, great topic. thank you very much. >> thank you. david: thanks for coming in. well the feddbeginning its two-day policy meeting tomorrow. with a recent downturn in the markets will the fed put tapering on hold? there is some indication it might. other people say absolutely not. we'll get into all that coming next. here's a word you should keep in mind "unbiased". some brokerage firms are but way too many aren't. why? because selling thfunds makes them more money. whicmakes you wonder. isn't at a conflict? search "proprietary mutual funds". yikes!! then go to e*trade. we've got over 8,000 mutual funds and not one of them has our name on it. we're in the business of nding the right investments for u.

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cheryl: federal reserve policymakers begin a two-day meeting tomorrow. it is the first one since the fed began tapering its asset purchase program and first since it happened this month. david: peter barnes on latest expectations what we can expect. peter, whether the markets downturn or the downturn on friday will affect their decision in any way. what do you hear. >> david, that's right, and that's the question right now because if the taper which got announced back in december just finally spooked investors, this

past week, could the fed put the taper on hold this week because of the big drop in stocks? not likely say many of the fed-watchers that i have talked to and e-mailed. december's decision to taper in part reflected that the fed's belief the economy was getting stronger and could start to wind down its billions each month in qe bond purchases and since december, most of the economic data has kept coming in strong enough to justify more tapering this week, these fed-watchers say. besides, last week's 3% pullback in stocks, comes after a 30% run up last year. >> i think the sensitivities we'll get discussion and certainly bear watching as we move forward but, you know, again on balance, the u.s. data has certainly confirmed their hopes and, so far so good. >> coronado thinks a 10% correction could get the fed's

correction, not necessarily because of a direct hit on investor but it could hurt consumer sentiment for example and any big drop in consumer confidence could hurt economic growth. but also remember, as number of these analysts pointed out to me with this downturn in stocks this past week, bonds have rallied pushing interest rates back down which the fed likes and that helps the economy. david and cheryl. cheryl: peter barnes, thank you, peter. david: thanks, peter. >> you bet. david: are you looking to escape all these brutally cold temperatures? cheryl: yes. david: everybody says yes. one state that is used to dealing with arctic air and lots of snow is actually bucking the deep freeze trend. which state is that? we have details next. cheryl: can i go there? we asked you on twitter if you think the recent market downturn will put tapering on hold? your answers will be coming up. ♪ welcome back. how is everything?

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this is where america's electricity comes from. a diversity of energy sources helps ensure the electricity we need is reliable. take the energy quiz. energy lives here. time to go "off the desk." national weather service says brutally cold weather across the nation. where do you escape the polar vortex? not florida, but alaska. on multiple days last month temperatures are warmer in alaska than texas, louisiana and much of the atlantic coast including florida.

fairbanks reaching a high of 40 degrees. who would have thunk. melissa: we asked you on facebook and twitter if market downturn will but put tapering on hold? james said the downturn should encourage to stop qe the market needs correction. stop propping it up with funny money. david: jamie said, no way, taper is here to stay. >> number one thing to watch tomorrow is going to be apple. the stock is trending to the downside. currently down 5%. as we were reporting, david, certainly a miss on iphone sales and ipad sales as well. david: got a beat on top and bottom lines in terms of earnings and revenue but they were expecting a 58.5, a lot of analysts said 58.5 iphones. they only sold 51. >> they were light. 42 to 44 billion for the second quarter. unfortunately that forecast as tom forte was telling us earlier is light. that is not what they were looking for the guidance. the guidance is a problem as well for apple. david: they have also changed

the expectations games. they used to really low ball the expectations. they have been bringing them up. maybe a lot of traders were used to the old style. they have a new style. >> "money" with melissa francis starts right now. melissa: the haves and have-nots. we've been talking about a lot here on "money." now just in time for the president's state of the union, a new report lays out how his health care law redistributes income. surprised? hear from the author hyped it and then business titan, mort zuckerman. even when they say it's not, it is always about money. is melissa: if you're among the top 80% of earners in the country this hits you scarily in the wallet. a new study on obamacare by the brookings institution, all but the 20% poorest will see annual