charles: i gotta say, folks, i really like what i'm seeing from market. i know everyone's saying you don't fight the fed, but if powell is really concerned about his place in history, he can look like a ham-fested -- fisted baby healey using the excuse they only have one tool. listen, i understand why he's afraid to give wall street an inch, and i don't blame them for that, but when the account is settled and they're making entries into the record book, he's going to get all the glory or all the blame. over to you, liz. liz: yeah. that's like us. all the glory -- [laughter] all the blame, right? we begin with a fox market alert. well, it looks like the pressure valve is easing on stocks as we head into the final hour of trade. and what do we see here? a broad-based rally. the dow hitting session highs just moments ago, right now it's

up 242 points, the s&p better by 59, the nasdaq up 45. and the -- 245. and the small caps up 24 points. with the tech industry far and away the leading sector here, the nasdaq is in the lead when it comes to percentages right now. it's up 2.25%. and the name at the very top of the charge, netflix. netflix is skyrocketing after handily beating subscriber growth estimates. but there is a problem, and it's not the fact that the stock is jumping 7.5% right now. a big chunking of its subs are free loading. yes, you know who you are, right? coming up, michael pachter is with us on whether netflix can figure out how to get those who are password sharing to pay up. netflix is not the only one in the tech world lifting the techland stocks. shares of alphabet at the moment are popping 5%, plus hitting the tape early with this headline,

ceo telling employees the google parent will cut 12,000 jobs, that's about 6.4% of its work force, citing the hiring spree during covid versus today's economic slowdown conditions. and here's how he put it, quote: we hired a different economic reality than the one we face today. pretty creative, i guess. check the stocks of silicon valley behemoths who have already announced major layoffs. we're talking about microsoft, which announced wednesday 10,000 employees will be cut, it's up 3.24%. amazon up 3.25% as well and meta platforms up 2.5%. let's look at the s&p, names populating the s&p leaders include silicon valley bank financial group, signature bank. again, net will flicks, of course, the number three -- netflix, synchrony and lincoln national. what is lagging at the moment? goldman sachs, yes, is down

about 2.25% after the consumer bank part of it is now part of a probe and an investigation by the federal reserve. we're going to have more on that with charlie gasparino coming up in the show. weakest s&p sectors, industrials followed by consumer discretionary, financials. but it is not just big tech's data shine. the entire month, folks, of january has been ultra-kind to the subsectors within february. look at year to -- within tech. this is the nasdaq's internet index. while it was down about 35s intk at it for the month, you'll see that it has had an extraordinarily decent start to january. semiconductors rearing hair heads. the -- their heads. chip makers and chip equipment makers up 8.66%. actually with, now it's 9.6% year to date. so it has had a really nice move

after a very bad 022. even social media looks healthy. the global social media etf which counts tencent and meta as its top holdings jumping about 14% year to date. and after tech got hammered last year, look at everything looking so healthy now. could it really be that simple? is tech suddenly back envogue? tech and growth versus value? let's get to the floor show, scott9 bauer and keith fitzgerald. guys, a bunch of fedheads, we've got to mention, using this last day before the central bank goes quiet ahead of its first meeting, to get out there and chatter. they all pretty much said same message with a slightly different font, as my son likes to say. esther george, christopher waller out there either doing a mea culpa or self-flagellating about missing the transitory thing, but that's why we want to go longer about tech. keith fitzgerald, you were buying at the lows of the entire

year last year. is this a bump? is it valuable? is it real or is it a bear in a bull's suit? >> you know, that's an interesting term. i'm going to have to borrow that, a bear in a bull's suit. no, this is the real deal because investors are becoming more thoughtful about what they're buying, and they're beginning to understand that there's the an end to this mess. never mind the fed, i think that the shift of in sentiment is key, it's important, and it's very sustainable if the fed if can stay out of everybody else's way. liz: yeah. well, just a note here, the dow just hit session highs, up about 25 the 2 points -- 252. high of the session a gain of 25 the 5. the s&p -- 25 the 5. wow, nice move for the s&p, now up 61 points. nasdaq also at session highs. this is an important hour. we've got 55 minutes left to trade. scott bauer, you do see a connection to the tech move

today and, i guess, last year when you talk about post-layoffs, right, with the federal reserve and what it did over past year and a half. >> yeah, exactly, liz. and i liken the explosion that we saw over the last couple years in hiring in tech world, and now the layoffs to what the fed is doing. they just, they couldn't get out of their own way. they overshot, okay? and that's exactly what many of these tech firms did especially during our shutdown. they didn't plan accordingly, they're now adjusting. and we've seen an initial very bullish reaction in most cases which, i believe, is somewhat overdone here. and i think that some of these stocks that have gained on the layoff news, they're going to get back some of these gains in the short run, but in the long return -- run, liz, they're going to help beaten-down stocks. we could start seeing double-digit gains again, and the layoffs are going to increase margins as the tech sector multiples are already

well below their 5-year average. so, you know, three stocks in particular that i have picked at over the last month or so, netflix. that one was just a trade the which i got out of today. that was just, you know, ahead of earnings. palo alto, i'm finally into green on this one. i've taken a little heat, but i love one, and i think we can get back up to 175-180 area because cybersecurity is not going anywhere. liz: 146 right now. 146 and change. if yeah. >> exactly, on palo alto. my cost basis is about 145 on that one. but tsf, taiwan semi, that one i'm in for the long run. liz: just like buffett. keith, you have actual puts on netflix, correct? >> i did. i liked the action today from a contrarian standpoint because everybody went away from cable television because they didn't like advertising, and now suddenly we're supposed to to give to the company that didn't

have advertising and celebrate the fact that that heir going to? i -- they're going to? it's a trade, it's not a -- liz: can i just -- >> i'm with scott, longer term, that's the key. liz: can i just bring up apple? keith, you were buying apple a lot last year, and i believe late in the year. that looks like a pretty smart trade, i think. but apple's the one holdout when it comes to layoffs, when it comes to big tech announcing these very large layoffs. do you think it joins google and microsoft and amazon and meta eventually? does it have to? >> you know, that's a tough call because, obviously, or i'm not privy to everything going on inside hq down will in cupertino. apple had a very measured hiring pace through covid, so i think there's a good chance they're going to continue on business as usual. that's good for the business. they know their margins, they know their business strategy very, very well. i'm optimistic and i'm hopeful that, in fact, the buying that i

did do does turn out to be smart. liz: it's up 6 month to date can. and over the three months down 4.5%, so there's a lot more movement here. but, yeah, dow jones industrials right now up 257 points. folks, we do have quite a rally. in the afternoon market, i just should mention, oil is up more than a buck. as we continue to watch all of this market action, much of it green, doesn't seem to be much hand-wringing on wall street about hitting the debt limit. but the fight over the national debt is making market watchers very nervous. sheila bair was the head of the fdic when one of the biggest brawls over debt limit broke open and out many d.c. we're going to ask her why our government can't seem to get right and the dangers she thinks are just around the corner. it's a fox business exclusive. closing bell, 51 minutes away. and, yes, lots of green on the screen, and the russell's

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liz: breaking news, let's show you a live picture right now at the white house. today a marks president joe biden's second is anniversary in office. he is speaking right now to the visiting conference of mayors. his term has been quite an interesting time for the markets. since january 20th, 2020 -- that, of course, is the inauguration -- the dow has gained 6.5%, and the s&p up nearly 3%. but the nasdaq has tumbled 17.25%. that is the third worst

percentage loss for any president. while the nasdaq aims to recover, martial debt spiraling out of -- national debt spiraling owl out of control surpassing hits limit concern its limit yesterday, and as it continues to spin higher as we see on lovely chart, a divided congress is squabbling with biden administration over raising it in order to insure government pays its bills, urging congress to come to an agreement, treasury secretary janet yellen said thursday that the treasury county -- department is now taking extraordinary measures to prevent the government from defaulting. i want to bring in sheila bair who in 2011 was at the helm of federal deposit insurance corporation, she's here in a fox business exclusive. well, shea rah, i -- sheila, i do have to tell you, you have seen this movie before, and i just want you to tell us how important it is not to have a sequel. >> yeah, it's really important

not to have a sequel, you know? this idea of undermining our fiscal responsibility by claiming to be promoting fiscal responsibility by, you know, messing around with the debt limit just is completely wrongheaded. so i'm sympathetic with the house republicans about the need for a serious discussion on spending reductions. we are on an unsustainable path. but to tie that to the debt limit or suggest that somehow the debt limit would not pass unless the there is an acceptable agreement to them is really irresponsible. but i do think also the biden administration should come to the table and talk with them, you know? there should be no question that they are going to pass a debt limit increase, but having robust discussion around spending and constraining spending would be a very healthy thing. liz: well, sure. but, you know, yesterday right here on this show jpmorgan's chief global strategist david kelly came on, and he said holding the debt limit hostage is akin to burning the factory

down. and i, you know, as you look at what happened back in 2011 when you were at fdic which, of course, makes sure banks are stable, you can see what the markets did just between july and september. they plummeted. >> yep. liz: 14%, i think on one single day in august the s&p fell 5%? what was it like at that time, and, you know -- [inaudible] [laughter] >> after going lu in the terrible financial crisis, we had this self-imposed volatility disruption imposed on us. it was not a good thing, it was horribly irresponsible by all parties involved. and one would think you would go back to that experience and understand why this really is so very dangerous. i do think, i have -- can because of that experience and because i think it's generally well understood now i that we cannot mess around with the debt limit. we have to pay our bills, we have to stand by our debt or it would be financial armageddon

just not in this country, but the entire world. i think people understand that. even the grandstanders in the house gop, i think hay really do understand that. which is i -- why mitch mcconnell said we will pass it, and they will. it may be shorter, it may not be as generous as the biden people want, but they will pass it. i really don't think we'll go that close again. i just would be shocked if we did, and i'd be really disillusioned with our government if they allow that to happen. liz: how might battle or discussion or whatever you want to call it play in if it gets close enough to what we see on the horizon or at least many strategists see on the horizon as a recession? may be mild, but it can't be helpful to that picture. >> well, no, it can't. government's going to need, frankly, room to issue even more debt. because if we go into a recession, what happens in recessions? tax revenues plummet. the cost of unemployment insurance and other safety net programs go up.

so in the near term, our government needs to have a lot of flexibility to issue debt, raise debt, to make good on the obligations that have already been committed anticipating the that in a recession tax are revenues will decline as well. it's the not a pretty picture, but that's likely could very well happen this year and also needs to be the taken into the equation. longer term we have got to get our house in order. this spending is just, you know, it's not even thoughtful anymore. there's concern. [laughter] a lot of waste. so much of it, student debt, so much of it goes to the intermediaries. it's not actually benefiting the end user, the public, and just more thoughtful design of these programs could really do a lot to, you know, control the government purse in a way that would not hurt the american public or working families. but we're not even having that discussion can right now, and that's really sad. liz: yeah. and that's where the democrats have been intransigent. so you assign blame to both

sides. >> [inaudible] liz: i want to ask you from having run the fdic, the health of the banks right now. we keep hearing they are in a much better position, certainly, than they were back in 2007-2008, 2009, maybe 2011. except that you do have banks warning that that they are starting to see certain problems. and even the credit card companies, discover financial yesterday came out and said that it's its net chargeoffs, which is basically what they are owed by some of their cardholders but they've written off as losses, doubled over the last quarter. that seems to be worrisome, does it not? and then you've got goldman sachs with the fed breathing down its neck saying, you know what? your consumer banking unit didn't have the right protections involved when you started to ramp up lending to consumers. >> yeah. well, you're right. and unsecured consumer department is frequently where distress starts to emerge. now, i think it is worth

pointing out that a delinquency and default rates are still at historic lows, so to some extent as they go up, it's a bit of a normalization. i don't take a lot of comfort out of that, but i think that fact does need to be placed on the table. also the banks now have much more aggressive reserve requirements, so they need to start booking reserves against anticipated loans, loan defaults far in advance from where are they used to have to start reserving and setting aside that money back. so that's part of this too. i do think goldman sachss, some of it's idiosyncratic. it sounds to me like they tried to grow too fast, didn't know what they were doing. they're a wall street bank, they're not a main street bank. they wanted to get into it, they tried, they're still going to try to keep that alive, but i think some was mishandling and rapid growth getting away from their risk management controls. i think we're going to have a recession. i don't want to understate that.. i'm hoping it's going to be

mild, but you're right, these are early warning signs, but the banks have a lot more capital than they did before so fingers crossed. liz: well, let's hope somebody's listening in washington d.c. [laughter] on all of these subjects, sheila. pick up the phone, call your old friends there. [laughter] laugh thanks so much for joining us. >> thanks, liz. bye-bye. liz: former head of the fdic, sheila bair. billionaire elon musk -- by the way, we're watching this closely -- he's expected to take the stand soon at san francisco trial over his controversial funding secured tweet. we'll go straight out to the golden state for up to the minute details on what is going on inside the court. closing bell, we're about 38 minutes away. the dow just popped a minute ago above 300 points to the upside. still up # 79 at the moment -- 279. s&p up 65. the nasdaq's percentage winner far and away, up 2.5% or gaining 2 the 70 points. we are coming right back.

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♪ ♪ wow, we're crunching tons of polygons here! what's going on? where's regina? hi, i'm ladonna. i invest in invesco qqq, a fund that gives me access to the nasdaq-100 innovations, like real time cgi. okay... yeah... oh. don't worry i got it! become an agent of innovation with invesco qqq liz: more questions being raised at this hour after the fresh revelation elon musk sold an additional $3.6 billion worth of tesla shares, and it's the timing that's raising eyebrows. now, tesla's moving higher by 4.33% right now, but the billionaire reportedly sold the shares in december, three weeks before tesla released its fourth

quarter report that showed deliveries well below the most recent forecast. and as you see right here, the stock then took a dive on that news. now investors are wondering did the tesla ceo sell the shares knowing they would plunge? that speculation adding to the billionaire's problems. he's on the witness list to take the stand today over a tweet he sent in 2018 incorrectly stating he had secured funding to take tesla private. kelly o'grady is in los angeles as we wait for the billionaire to take stand in the san francisco courtroom. is this gonna happen? is he close, do you think? >> reporter: well, liz are, i have some breaking news for you, we are learning from court officials that musk is expected to testify today as soon as about an hour or so. but given the timing constraints, the court is expected to wrap up around 5 p.m. eastern, that testimony will likely spill over into monday. we have confirmed the plaintiff's counsel will call the billionaire next, and that is expected to last over two

hours. we've been monitoring court closely and have reports that his security is already present. thus far today we've heard from two witnesses, timothy shared how the billionaire's tweets convinced him to invest in tesla, as well as an expert witness from harvard law school testifying how musk's conduct deviated from what a typical management if buyout would look like. that second testimony has been quite interesting. a number of pieces of evidence including e-mails with potential investors have been dissected before jury, and there's been a lot of comparison being drawn to the dell deal back in 2013 that a transaction of this magnitude, which would have been over $70 billion, would take month, even a year whereas the tesla process took 30 days to come together according to musk's team. i can also confirm from my own experience that these deals take months and months. from the opening statements, we can expect musk's testimony today and potentially monday to argue he believed he had financing from saudi backers and

that fearing leaks to the media, musk's counsel alleges he tried to protect the everyday shareholder by bringing them into the loops with those betweens, not misleading them. and -- tweets. and i just want to highlight the jury instructions. the judge has already ruled the statements were untrue, and the jury is being instructed to assume that as well, and then from there determine if the statement statements were material and if loan knew they were untrue. and that's important, liz, because often these trials do come down to how hose instructions are worded. we will let you know if missing walks in the door. liz: yeah, please do. thank you very much. interrupt us, that's fine. we want to see this happen because as we watch tesla and all of these stories swirling, it is a big investment that a lot of our viewers are interested in, thanks. fox business alert, let's look at the markets and, again, we just hit brand new session highs a few minutes ago, touched them and then moved slightly lower. we have a new high for the dow, a gain of 318 points. right now at the moment we're up

288. s&p, new high, a gain of 71 points. we're up 66. and the nasdaq, still the the star shining away, up 266 at the moment, high of the session a gain of 2 the 86. so green on the screen. now let's take it to barclays who is naming what it says is the most fashionable stock in the fashion the industry. the bank calls ralph lauren best in class, upgrading the stock to equal -- from equal to overweight because they say it's got a proven track record and brand elevation. polo ralph lauren up 2.75%. analysts see continued growth in the apparel market's international and direct to consumer segments. and why do we have pbh up there? barclays is also raising the calvin klein parent to overweight from equal weight seeing early signs of success in its north american market as the company takes full ownership of its licensed businesses. not all good news in the retail

sector. nordstrom's struggling after announcing holiday sales were softer than expected. if you look at this intraday chart, it is the well off the lows of the session and even just about an hour ago punched into the green. right now it's lower by just a fraction here. ceo eric nordstrom warns that even wealthier consumers are becoming more selective with their spending. the company downgraded its financial forecast for if fiscal 2022 to the low end of its previous forecast of 5-7% revenue growth. chinese travel company trip.com, this one is hitting a 52-week high as the reopening in china and easing of covid restrictions there has boosted travel appetites. the stock is up 1.7% at moment to $38.22. so we thought, well, let's check u.s. travel names. they're also moving higher. experiod -- expedia up 3.5%, and we've got try having go up 3%. investors chirping a happy

tune after rovio entertainment, the company behind angry birds, received a new takeover proposal. the deal would value the finnish company at $813.5 million. no previous offer had been published, but the israeli-based platika said it made a lower proposal back on november 16th. the stock up 7% at the moment. netflix sitting in the pole position at this hour after its fourth quarter subscribers sent it to the winner's circle. one of the nation's top media analysts, michael pachter, is here with the postrace analysis and the yell elope flags that might be waving -- yellow flags that might be waving ahead. closing bell is 27 minutes away and the dow punching back very close to 300 points to the upside. we're moving very fast here so stay with us. ♪ ♪

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liz: i have some breaking news for cobra kai fans, that would be me. the emmy-nominated hit -- [laughter] which i love, returns to the dojo for a sixth and final season. netflix has not given a premiere date for the karate kid saga, yes, starring john -- oh. but said it's coming soon, and fans should prepare for the biggest season yet. now, the stock at $340 and change, it is up about 105% from its 52-week closing low of 166 and change back on may 11th of last year. as investors cheer 06789g. stream ther -- o.g. streamer many its fourth quarter blowing away the street's expectation, that brings netflix's total subs

to 230.75 million to round out 2022. netflix did miss on earnings. it matched revenue estimates, but streamer's new ad tier seemingly is saling the show. in his first -- stealing the show. top media analyst and web bush securities managing director michael pachter joins us. michael, are you familiar with cobra kai? >> i taught pat morita's daughter how to swim concern. liz: no! >> i did, i cross my heart. but i haven't watched cobra kai. [laughter] liz: well, it's my personal favorite on netflix. however, that said, give me your top line, you know, 30,000 feet on the earnings. we know that already came out yesterday after the bell, but what really has jumped out at you? >> i mean, you know, they actually crushed on operating profits. so the earnings disappointment was on currency translation. but the big, the big news is that cash flow was $1.6 billion

for the year, and they expect it to double this year. so, you know, the knock on the stock from me for the prior ten years was they didn't generate any if cash, and when they decided to start doing it, heir doing it with, you know, with a gusher of cash. and it shows you that they're focused on expense control, they're focused on driving profitable revenue growth, and that's the kind of company you want to invest in. liz: and there was one almost squishy or maybe a better word so pick number, but market -- opaque number, but the market is gleaning positive things from it. they did not break out their numbers for the new ad-supported tier which a lot of people had been pushing for them to do. hay finally did it. hay didn't give out the numbers, however, there's an organization that i know you're familiar with, they were able to deduce that the introconduction of the new ad tier -- introduction of the new ad tier, right around that time sign-ups shot up more than 50% during the first few days that this ad tier was made

available. what do you extract from that? >> well, they did actually give us the metrics that you could interpret if you did the work. i did. their average revenue per user was down in every single region. and by an average of, you know, 4% or so. what that a really tells yous is that they only -- tells you is they only grew subscribers by 3%. so pretty much all of the new subscribers signed up at a low price plan. that's really what it means. which means of the 7.6 million new subscribers, they probably added 7.6 million ad-supported subscribers. and that's fine. they're not monetizing that yet. heir going to monetize that -- they're going to monetize that beyond the $6.99 a month they're charging by selling ads. and if you look at hulu's numbers, about $10 per month per subscriber. i'm pretty confident that

engagement on netflix is higher hand on hulu, so i expect netflix would get to $10 pretty quickly and suddenly see average revenue per user go up, so i really like the story this year. they're growing subs, they offer a low-price plan and they're going to monetize. liz: but wouldn't it then make sense that they've the had success here that they would then go to put out a free ad tier? >> it's a good question. i mean, free, free is tough when you have 230 million subscribers. i think if you're starting from scratch, that might make some sense, but it's hard because they've been charging $5.49 -- 15.49 for so long that i don't think the people who pay premium would take that very kindly. i think they'd resent fact that they're giving it away. $6.99 plus ads is fine. have to literally deliver 12-18 minutes of ad to make free make any sense at all, and i think you'd with alienate your

high-end subscribers so, no, i don't expect it. liz: let's get to some yellow flags that are waving. one of them, when i talk to analysts and people who look at this company very closely, they say that netflix does not have a subscriber problem, it has a monetization problem. they are unable to monetize a huge chunk of their subscribers because those subscribers are freeloading. they're operating and piggybacking off other people's passwords. and netflix needs to do something bigger about, does it not? and until it does, what kind of money are they watching flow out the window? >> that's absolutely fair. and, you know, it's kind of reminiscent of music-sharing services in the last century, you know, the napsters. and the solution was to make it so inexpensive to buy songs that people stopped stealing them, and that's where itunes came in, at the time, 99 cents. so if you offer people password sharing as an option but you make it inexpensive, i think

most people are honorable, and they'll do it. model is spotify. so spotify is $10 for one person, $13 for two and $16 for up to six. so you take the net if flicks subscription, maybe make it $20 and say up to four individual accounts no matter where they're located. i'm not going to share with my neighbors, but i am going to share with my if adult children. my kids are 22, so when they finally finish college and move out, absolutely, i will add them to a family plan. we're on a spotify family plan now. so it's something we're used to doing. we're on a cellular family plan as well. so i think that's the model, i think that's what netflix is going to do, and i think it's going to work. liz: okay. and, you know, we've got the management change, reed hastings gown upstairs to executive -- going upstairs to executive chair though knowing reed hastings, he's going to be the tie breaker between the new two-ceo and then, of course, ted who's already there. tell me how you think that's

going to work, and reed had said if netflix were ever to get into sports, that they would want to own the whole piece of that. what's your prediction there? >> well, i'd like to see reed go to twitter, because i think he's a very good ceo and twitter right now needs some leadership. i don't think that netflix will ever compete in expensive live programming. i don't know how they can do it. they're not going to come up with billions of dollars a year for an nfl package. and netflix is not a by-appointment type service. they're an on demand service. so, you know, i think amazon's noodling around with this, and is i don't think it's the particularly successful. i don't think it's driving prime memberships to watch thursday night football. maybe netflix will do something like one of the european soccer leagues or something like cycling, but i don't see them participating in sports at all. my prediction on the co-ceos, i think, unfortunately, reed does make mistakes, and he surrounds himself with sycophants. he's the emperor, and if he puts

on a naked suit is, they'll tell him how great he looks. [laughter] i don't think that changes. rick peters is as wad as -- as bad as ted in doing that. it would be mice to see if they get some new thinking at the company, and it took them a long time to acknowledge maybe an ad-supported tier would work. so we'll see. liz: long time. that is true. so you taught pat morita's daughter how to swim. i babb bysat -- babysat tori spelling. >> my mom dated aaron spelling, so will you go. [laughter] liz: well, six degrees of separation. we should stop there. good to see you, michael. [laughter] thank you so much for joining us. >> thank you, liz. liz: have a good one. you got it. all right, goldman sachs having a horrible, terrible, no good, very bad week except for one day, yesterday. first getting clobbered by its quarterly earnings miss, now there is news of a federal probe into its consumer banking arm. charlie's going to break some

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liz: it's been an atrocious week for goldman sachs, a dreadful earnings report tuesday followed bane investigation into its consumer banking unit. and that sparked a federal probe. let's get to charlie gas a relationship oh. charlie: . it's not been a great week for the embattled ceo. the revolt is about this marcus business, the consumer bank. a lot of traditional goldman sachs people are saying why are we getting involved in consumer

banking. it's not working and it's being hit with what we confirmed is a federal probe. be careful about this. the market might be overreacting. this could be a $250,000 fine or $2 billion fine. we don't know. the fed is camped out in every bank. it probes everything involved with consumer banking, everything. this could be a trip wire. it could be nothing. i have seen these sort of federal reserve investigations before and they peter out, based on an explanation. and they often look at everything. consumer banking is one of the most heavily regulated activities out there. let's just get to why they are under investigation. i have been able to piece this together to talk to people outside the company.

if you look at how they ramped it up and grew the business, they grew fairly substantially. lots of people use markets. it grew really fast. so fast it surprised people at other come pete p -- ought other competors. now getting retail banking clients, it's the quick ramp up of this thing which probably is at heart of this probe. whether they in that rampup, did they dot every "i" and cross every "t"? you kind of crossed the line a little bit, it will spark an investigation. that's what the fed does. there are two stories in my view. there is this story, then there is a story about david solomon.

this was leaked internally by somebody in my view. this is why we are seeing this. goldman put out a statement, gave us a statement which said they don't talk about these sort of things. but i am telling you that this is -- the timing of this is pretty obvious. david solomon under a lot of the pressure. something about markets people are trying to blame on him, the short comings of it. like i said, the feds probe everything all the time on these banks. this could be a nothing burger. but just keep that in mind. particularly if you are trading the stock on this. liz, back to you. liz: it's been very, very difficult to do that because people might have thought all the bad things were out of the way and then this happens. charlie, thank you very much.

closing bell ringing in four minutes. the major averages up today. this certainly helped them for the week. the dow and s&p are snapping a two week losing streak. the nasdaq appears to be up. let's call eight volatile week on trading for all the major indifficult sees. roth will mayfield is joining us. what are you thinking about the last couple weeks which looked good, the january effect, maybe. >> yeah, i think certainly a relief. but had the macro picture changed that much. the answer is a little bit. they are starting to change their tone about the accelerating pace and the 25

point basis point hike. you are starting to see light at the end of the tunnel for the fed and inflation. we are not there yet. but i think some of those things are helping the market boost. the fed is very, very, very content on getting this done. if the labor market remains tight, we may see it get more aggressive. liz: the fed is promising something, people better listen. so, you have four sectors you really like, and i notice tech is not one of them. let's tell our viewer was they are and why you are still not picking tech. >> i think you could broadly sum it up as a value versus growth trade. you like things like materials. we think a soft landing in the economy will boost the

cyclicals. something like industrials or materials. there is longer-term tail winds from infrastructure spending and ramped up spindling on defense. we like those sectors independent of what we view as a slightly higher rate and inflation environment that should benefit value. on the flip side, tech and growth, i think there is more to this story. if you use 2001, 2002 as a comparison. it took almost a decade to get back there. there is time to get out of the bubble, even if the pain is priced in. liz: i have got to bring up energy. it's certainly the big winner last year. you still see so opportunity here? does it all depend on how high

oil goes? >> we still like energy. i think a bit of a pause is probably narrative given the incredible run it went on. it might not be the outperformer we saw last year. there is still structural tightness on the supply side and opec plus and the volatility from the situation in ukraine ukraine. liz: ross mayfield, thank you for joining us. as he finishes, so do the markets session highs. larry: welcome to kudlow, i'm larry kudlow. permit me to continue our conversation from last night's town hall meeting, the theme of whic