russ koesterich and michael yoshikami. >>> up next "on the money," the foreign policy expert who says the biggest threat to america does not come from abroad, but from within. what he means and why he said it. >>> and later, celebrity chef mario batali serving up new projects. the owner of some 24 restaurants around the globe tells me what's on consumers' menus in the food world today. as we take a break, take a look at how the stock market ended the week. back in a moment. >>> welcome back. he is the president of the council of foreign relations, and he has served in four administrations for both democrats and republicans. but now richard haass is focusing on domestic issues and says the biggest threat to america right now does not come from abroad but from within. he is the author of a new book "foreign policy begins at home: the case for putting the house in order." good to have you. >> thanks very having me. >> it's an intriguing title. you said the biggest threat to america is not from abroad but within our own home. what do you mean by that? >> first of all, two things. there is

michael yoshikami, everyone's talking cyclicals right now. are you as well, very quickly? >> yeah. we have actually moved a bit of money towards cyclicals. we bought a company recently, adidas, for example, which is more of a cyclical retail name. so, yes, we are actually moving towards cyclicals. we're still keeping a core of defensive, bill, because the market has rallied significantly so. >> last one to heather here. i'm going to ask where you're going. everyone's going to cyclicals. is that a crowded trade for you, or are you going there too? >> we don't feel that trade is crowded, no. >> so you go there as well? >> we would be moving into cyclicals among other things. >> okay. thanks, everybody. >>> heading towards the close with 50 minutes left in the trading day. the dow was up 150 points at the peak and down 50 points right now. a 200-point trade on this fed day. >> do you like blackjack? >> i do. >> so do i. after the break, we will talk in an exclusive interview with the ceo of mgm resorts. his stock up better than 50% over the last year. you might be surprised to find wh

in today's exchange, we have michael yoshikami, dan from janney capital markets, peter costa on the floor of the exchange from empire executions, and welcome back, rick santelli, from a well-deserved week off. and when you come back, ten-year yields are at a year-high and that two-year note auction didn't go so well today. doesn't hurt the stock market, though. >> no, and that really is the issue. it might not have hurt the stock market, but maybe it gave us a little taste of what rising rates can go to the stock market or the pressure it might put on the fed to try to clear up what's, to me, very unclear. if we look at two-year note yields, you know, they were 19 basis points on the second of may. they're now at 28. if we -- these are the highest yields, should we close here, bill, since early november of last year. five-year note yields touched 1%. haven't seen that since april of last year. and by the way, beginning of may, they were at 64 basis points. the ten-year at 213, the high yield of the day, that was at 163 on the second of may and also, the highest levels since early april of

shelly villry is with us, michael yoshikami as well as jeff cox from cnbc.com and our own rick santelli. welcome to all of you dapper-looking guys out there. sandy, we just keep going higher here. >> keep going higher. but if you look at it, the market is still cheap. we're 14.5 times forward. the medium over the last 20 years is 16.6 times. i think there's still of room on the upside. a lot of cash sitting on the sidelines. a study by schwab said about 26% of their clients had money in cash. >> last week we saw the first positive week for equity inflows in i believe eight weeks. we're still waiting for data tomorrow. but when i talk to traders, they say, most of that is still coming from cash. have we seen that rotation start at all? >> we've had a trillion dollars come into bond funds over the last five years. 650 billion come out of kt funds. so 40, 50 billion have come into equity funds year-to-date. there's still a lot more to come and people are still negative even though we're in the 51st month of a bull market. >> and we're all watching the fed like hawks as well, or doves, as t