what the fed did was twofold.supplied liquidity, through ordinary open-market operations and through use of the discount window -- very standard techniques of supplying liquidity. but, under the guidance of chairman greenspan, they also sought to reduce the demand for liquidity, in other words, to use what you might call tender persuasion to convince people that they needn't go seeking liquidity, bidding for liquidity, that it would be there. schoumacher: in 1929, the fed tightened the money supply. this time, greenspan did the opposite -- the fed's message was, whatever you need, we'll give you. greenspan had said the magic words, but was anyone listening? on tuesday morning, the market continued its dive, plunging 225 points. by noon, the market was approaching complete meltdown. buying was at a virtual standstill. then, buy orders began trickling in, like water upon parched land. the buying trend accelerated, and wednesday morning, the world awoke to headlines touting the largest rally in the big board's histor

the fed watches something the cme keeps out. the fed percentage possibilities of a fed rate hike. march 2014 meeting a year away, and 8% chance. in october 201432% chance. you have to go to the june meeting of 2015 before you get more than a 50% chance of a rate hike. what are the possibilities it will be a half a point where three quarters of a point or a point. we can break that down for you up there now. there wasn't a lot of trading, but going forward, the trading has increased, the volumes have increased, a possibility that perhaps the economy recovers and the fed someday does something positive and hikes rates, but right now you see what you see. lori: if you buy the fed fund future targets, that is when we will see the unemployment targets 6.5%, at least that is what the fed has been telling us. jeff flock, many thanks. let's talk earnings, a bellwether for the economy, talking about fedex saying customers are getting cheap and it is costing them missing earnings expectations by a whopping $0.16 per share. down 5% on the news now down 6% or $6.43, but the worst decline in 1

the fed would not stand by.raised its scountate to force banks to increase the rate of inrest paid to depositors. the result--foreign investors earned more interest and left their money in u.s. banks. that ended the gold drain. but raising thdiscount re had other, less fortunate, consequences. if the federal reserve raises the discount rate, that transmits a message to banks and the money market that it wants to be restrictive. for the economy as a whole, the result was disastrous. high interest rates discouraged borrowing, choking off business credit. more businesses failed, more jobs lost, and more banks collapsed. the country was pushed deeper into the great depression. well, professor, if you graded the fed-- a, b, c, d, f-- what would it be in the 1930s? i would grade it as an "f" applying today's standards. probably a "d," applying even the standards-- the most advanced standards of that day. sure, you can criticize the fed. it made mistakes. but what it did wrong was a matter of degree, mostly, rather tha

has ae fed >>> the fed has a new decision time, 2:00 p.m. eastern on the dot.s are on as we await word from fed chief ben bernanke. keep it right here on cnbc. >> and we know that's where bill gross of pimco is patching. he was not available to talk today but it doesn't mean he wasn't available to comment. he did tweet. he said central bankers a century apart. lend freely at a penalty rate. bernanke, lend freely at a subsidized rate. even the fed is pumping up the action today with this tweet. watch live today, a fed tweet! 2:30 p.m. press conference with fomc chairman bernanke. let's welcome back our panel as we count down to the fed decision. ben white, josh boak, kneel nein and michael santoli. does bernanke have any real dissenters on this fed board and who is it if he does is it. >> he has esther george, the president of the kansas city fed who is dissenting this year. i suspect she will again today and then some of the people not voting are very much in the hawkish camp. that's richard fisher, charlie plosser. the thing is bernanke for now has control ove

cheryl: you been talking about the fed today. obviously the decision from the fed chairman.n for years of the fed just pushing liquidity do you think that the markets would survive if and when we got a pullback from the fed on qe? >> i almost think that would be the best thing for the markets over longer-term perspective. for the fiscal policy makers to finally make some decisions and we could start to make some longer-term progress in terms of economic growth and move to a new secular bull market as long as the fed is supporting the market and is pumping liquidity into the market. that may it that much harder for the fiscal policy makers to step up to the plate and make the tough decisions that need to be made. cheryl: obviously watching the dollar. gold, gold is still something you would recommend. >> longer-term yen. we have pretty much every major central bank looking for ways to build more liquidity in the market. cheryl: okay. in business strategist. he's not sweating the last few minutes, but we certainly are looking at the closing bell as we get close to 4:00 p.m. ea

the fed, i'm interested to hear santelli's comments coming up, but the fed, as we know, is easing. and with our debt at $16.5 trillion, in theory, if interest rates were to rise, just 1%, only 1%, that would then increase our interest costs, in theory, $165 billion. >> right. >> that does cause for concern down here across the street in d.c., as far as a budget deficit problem, and interest costs headed higher as interest rates tick higher. >> let me bring in a special guest here to the conversation, fresh from ringing the closing bell, alfred e. smith, the fourth wall street veteran and founder of a.e. smith associates. he's also the great grandson of the four-time governor of the state of new york, serving as chairman of the famed annual dinner, named after his great grandfather and his son. maybe he lead the new york st. patrick's day parade as grand marshal. good to see you, al! thank you so much. i know your parade is on saturday. al, let me ask you, back to the floor, what feels different to you? and you've seen and participated in lots of rallies and lots of sell-offs if you

former fed governor wayne angell tell us us what fed policies he would put in place to get our economylly growing as it should in a fox business exclusive. lauren: can't wait to hear that. despite fauks of a potential bank run, one economist says europe says europe presents great options and some of his picks might really surprise you. ♪ girl vo: i'm pretty conservative. very logical thinker. (laughs) i'm telling you right now, the girl back at home would absolutely not have taken a zip line in the jungle. (screams) i'm reallylad that girl stayed at home. vo: expedia helps 30 million travelers a month find what they're looking for. one traveler at a time. expedia. find yours. today is gonna be an important day for us. you ready? we wanna be our brother's keeper. what's number two we wanna ? bring it up to 90 decatherms. how bout ya, joe? let's go ahead and bring it online. tention on site, attention on site. now starting unit nine. some of the world's cleanest gas turbines are now powering some of america's biggest cities. siemens. answers. but that doesn't mean i don't want to make mo

to me it may say more in that fed way that only the fed can do. which is this, in determining a size, pace, and composition of asset purchases, the committee will continue to take appropriate account of the likely efficacy and costs of such purchases as well as the extent of progress toward its economic objectives fon me, and tell me if it's wrong, that suggests the fed is now thinking about how much this is really working or it's worth. >> i think that might be right, brian. i have to say until you said that, my answer was going to be i have no clue. so i am glomming onto your interpretation right there. i think that might be it, that there's some discussion about that. now, i can add perhaps the notion of politics, that there's a contingent inside the federal reserve that is concerned about this and wants a little bit more concentration on costs and they were given this line, and i think we're going to have to interpret it maybe as to whether or not it's working. that might be the best interpretation, brian, so good on you, as mandy would say. >

so you can say it's the feds, the fed, the fed. but at the same time, wealth is increasing. and the game right now is to say, what is going to jar investor faith and confidence? what is going to force p.e. multiples to contract? and frankly, it could happen out of the blue, but it hasn't happened yet. and we do have actual improvement in some pretty key areas in the economy, construction, et cetera. >> let me go to mr. mark and rick santelli. put them all together for us here. it's been very much a risk on day. the euro has gone higher, the treasuries have gone lower in terms of price. what do you make of the market and the message today here? >> well win look at a two-year 25-year basis points, it really hasn't moved. i look at a five year at 79.8, which is exactly where it was before any of the fed activity. 195 ten-year, the 30-year at 318. dollar index has marginally improved to smaller loss. and stocks, by far and away, have held on to about 20 points a gain they didn't have. i don't know. down on this floor, they say ben's an honorable guy, but a little bit of plagiari

why the fed might dial back.h he need to monitor this. >> look at the output, i don't think steve is wearing a watch. >> not wearing a watch. that's for later on in a segment in the show. >>> okay. heading to the teflon world, housing stocks hitting the highest in years. dia diana olick is in florida. >> reporter: that's right. the housing numbers were good. very good, not great. we have to remember, when we look at home builder sentiment yesterday, it ticked down two points. the builders are talking about problems finding land and higher costs for land and material and they are talking about credit, mortgages for the buyers and credit for them to build. we take a look at the housing start numbers today. single housing ticked up half a percentage point. multihousing was better. you see the permit numbers ticked up a lot are mo. single family, up 2.7%. multifamily, up over 8%. and that's the point i want to make here. multifamily has been driving this market. we're here in miami talking about this new condo boom b

fed, ecb.idity. >> there's plenty of money. >> that doesn't mean there's no risk in the market. smart investors shouldn't try to time things but look at high quality dividend paying stocks. matt and i were talking beforehand. we both agree that's the best place to be. the thing you should be doing right now in terms of paring back risks. >> did he give away your schpiel there? >> if you look at a stock leading s&p year to date it's netflix. 14 times price to book. in cincinnati we say that's a little bit overvalued. look at dividend paying stocks. they're cheaper from a pe perspective, price book perspective. they're paying you more to own them. i think there's going to be rotation into the higher quality names. i just don't know what the catalyst is. >> we keep hearing it. this is very much a stock picker's market. you got to be mindful of individual stox and not try and look at the overall market. >> this is a momentum based market. today volatility starts to pick up. i think we'll see more v

a lot of fed speak today. we'll hear the from greg and get his thoughts on that. rick santelli is still with us. and kevin carowny will be joining us in just a moment. okay, we have all these head winds, but we've come so far, so fast in that market. >> that's right. >> and you still think there is that much left, that we're at 14,500 right you, you see another 1,500 points on the dow? >> absolutely. you're going to see the logic of saying, we've come this far, this fast, so you're due for a pullback, that's what everyone's saying. corporate balance sheets are healthy. you talk about stock buybacks nearly every day on the set. and then you have to look at everything else that's out there. there's nothing else that's pushing this market down, where it's going to keep it down. and clearly this issue in cyprus is obviously a nonevent. >> but greg ip, i don't think you think it's a nonevent, do you? >> no. well, it's very hard to know, sue, exactly how to price a cyprus event. the fact that we got a bailout pack,

are changing at the fed. 1:50 p.m. so t10:00 to 2:00. >>> it fell short of street's estimates. shares of fedex are down 5% this morning and there's a look at the chart so what does it mean for the broader transports here? let's bring in jim corridor of s&p capital iq and he has a strong buy on fedex and a $129 price target. ? good morning. >> good morning. >> what's your biggest takeaway from the report this morning? >> certainly operating margins declined more than we were expecting, but it happened for a reason that we already knew and that fedex has identified and that's that international trade networks are moving more toward deferred and it's impacting margins and the company has a plan in place to take care of that. they're expanding on the plan today and they're redesigning their international networks and you think they're on top of the issue. >> why aren't you more concerned about the shift away from premium customers and also the international air weakness. those are two important metrics and you so

on the fed. >> we are seeing more of a buzz.utiful ferraris, just like when you driving, one of italy's most winding roads, you have to be careful here. as we see this gold has come down, i want it use my best all state voice, protect your profits. so you will see this technical target in the s&p. only about a percent away. we should see them with this technical target but it is time to protect. >> have you ever really been on that road you were talking about or just read about it somewhere? >> i have, buddy. in a ferrari. you should come with me next time. >> i will come with you next time. have a great afternoon, guys. ty, back to you. >> we are talking about stocks lightly to lead us up or down into the close. when we come back in two minutes, as we round out this remarkable week.

what happens to stocks when the fed starts raising rates?istory and try to answer it right here on street signs. >>> and find out what women can do to better bust through the glass ceiling. and how student loan debt may be hurting the housing market. >> and we will ask, what is the single best airline stock to own? >> if the douw holds its head above water, it will have said hello to its first seventh straight day of gains. and we have only ten points before it cracks its own record high. and something we have not seen since 2007. the vix trading below 12. want to get to you on the core of the new york stock exchange. we have volume that is low. what does this say about general sentiments out there? >> you have got a really interesting shift in sentiment. people still don't like this rally but they believe in it. and they really don't see any catalyst that will bring it down. the one thing that looked ba ee for the end of the month. now starting to look a little better. we do have this winning streak. you're seeing it across the board in ter

apologist for the fed.o you stick up for these -- >> i'm not sticking up for anything. >> experimentation. >> saying what the policy is and the reason for the policy, and over four years, rick, i've yet to hear a better answer from you. >> this economy doesn't need wise men from ivory towers. >> we'll let you go at this point, but we just did notice, at least you guys are wearing the same suit today so you agree on something. good to see you both. you did not disappoint. >> thank you, guys. have a good weekend. >> heading towards the close with 40 minutes left and we're heading higher again. the dow was up 83 points. that euphoric rally on the open this morning following the jobs number, it has since pulled back but still a healthy gain of 60 points. any positive close is a new record today. >> have you looked at your 401(k) lately, bill? >> as a matter of fact i have. >> this market rally making people very happy to open that 401(k) statement. most are back and then some from the depths of this crisis. com

let's talk about the fed. dagen: republicans worst nightmare, tax reform done by the democrats really don't get rid of the tax rates, we don't lower rates, they get rid of some of the deductions and we wind up a lot of people paying higher taxes. dagen: the true definition is broad enough base, lower the rates. you have to avoid that. connell: don't think we're moree optimistic than we were before, but good to see you. dagen: good to see you, my man. connell: we said we would talk about the fed, less than three hours from the federal reserve notes and whether or not it continues stimulating the economy at the current levels, keeps propping things up. why don't you just pick up from where we left off because talking about washington related to the bigger picture scenario not assist early today but the role the federal reserve plays in all of this as long as interest rates stay as low as they are, what do you think? >> the fed plays a big role keeping interest rates low. i heard on the fiscal side, you're right,

when we see a fed official suggest that maybe the fed will slow down the pace of these purchases thatll the money to the system, the equity market sells off alongside the bond market. there is definitely some feeling if we lost that support from the fed, some of the gains at very least we see from the equity market might not be sustained. liz: this brings up the question. when they were getting closer to deciding, it will be time, clearly, michelle, they will be so careful, like treading on eggshells, as whether are are or how they will telegraph this to the market guess what it is time, people. for months and months in advance would you expect this? in what form? scaling back qe. then what? when they finally pull the trigger how will we all react? >> it will be a very stance parent process just like you said. they are going to move particularly beginning cycle change about stopping or slowing purchases. even that will happen in stages. they will gradually reduce the amount of buys each month so by the end hopefully it is a very smooth transition in terms of market doesn't sort of not

on the fed minutes. we're reading every word, you know, and looking for nuance and shape as to what's going on inside the u.s. bet. the smallest little glimmer of what they may do has driven huge interest rate volume trades around the world. so it looks like it's right for a lot of increased activity. it's just going to be, when can we get those signals? >> given this run-up that we're seeing in stock prices, are you seeing a rotation out of fixed income? everybody's talking about this great rotation, but then there's an argument that's been made that this new money is coming from cash. so is it coming from cash or is it coming from bonds? >> you know, i only have limited visibility, but what we've seen is that it's not a rotation yet. it doesn't mean there won't be one. right now there's a lot of money sitting on the sidelines. as a public company, we've been thrilled to watch just our own stock price performance, as well as the pieers that i follow in y industry, but it doesn't really seem to be coming

you have the fed underneath.tor, which, again, some people want to trade against. i don't think it's a wise call yet. there's a lot of money flow that can come into the market, and justifiably so based on where equities are valued right now. that's a tough trade to be involved in. >> what are you doing right now with this market? >> right now, i'm comfortable long. if i'm a long-term investor, if i'm from my trading account, i don't want to go home long this weekend. i think you get a chance to buy them a little bit cheaper monday. but, again, as i said, first day of the month is monday. i would rather go home short tuesday than today. >> all right, thank you, my friend. let you get ready to trade the close here. what a first quarter. th

>> we're going to handicap the fed. what is the fed trade tomorrow ahead of the press conference? and it is the biggest week for ipos. fascinating, huh? you didn't know. biggest week for ipos. so we are going to watch what to watch. they called out groupon before they went public, so they're one of the few firms on the street who said with groupon there could be -- >> why do we think we're getting this record number of ipos now? are they trying to clear the decks and fear the markets could become unstable? >> because we're in a bull run. even though we are down today, we're in a bull run. companies want to get out there when the markets are doing well. >> let's just -- speaking of markets doing well, we're now down 42 points. so we've had a big swing in the course of the conversation. we were able to rebound nicely at the open as cyprus fears were pushed to one side. now, down 44 on the dow. the s&p falling to 1,542. so failing really to gain upward traction to say the least, as you can see. negative territory. if we're able to break that down, i think financials were doing reason

with all the fed-induced stimulus.ted yapping about hopium two years ago and the dow is up 2,000 points. clearly, mandy, two lessons here. one, always watch "street signs." two, history, as we said, littered with those who tried to fight the fed. because remember, america, their printing press is a lot bigger than yours. we're back after this. tdd#: 1-800-345-2550 i've been doing a few things for a while that i really love-- tdd#: 1-800-345-2550 playing this and trading. tdd#: 1-800-345-2550 and the better i am at them, the more i enjoy them. tdd#: 1-800-345-2550 so i'm always looking to take 'em up a notch or two. tdd#: 1-800-345-2550 and schwab really helps me step up my trading. tdd#: 1-800-345-2550 they've now put their most powerful platform, tdd#: 1-800-345-2550 streetsmart edge, in the cloud. tdd#: 1-800-345-2550 so i can use it on the web, tdd#: 1-800-345-2550 where i trade from most of the time. tdd#: 1-800-345-2550 which means i get schwab's most advanced tools tdd#: 1-800-345-2550 on whatever computer i'm on

i have laid out why the fed has fuld the rally.u buy a stock, you're buying a share of its earnings. the price to earnings ratio used to figure out the value of a stock is still low. let's take a look here. i want to show our viewers. the s&p 500 is seeing average earnings of 15. that's the bottom bar. that's half of where they were. lower than where they were five years ago when the dow was trading at about where they are now. that makes me think this isn't just the federal reserve. what do you think? >> it isn't. as a matter of fact, the fear that's in people's hearts right at the moment, it reminds me of rodney dangerfield. the market has no respect. nobody has respect for this market that it is real. clearly we're seeing the public and institutions, i might point out, have been lowering their equity exposure. the the public only has 30% in ek equities. 47% don't even invest in the stock market, which i think in my 40 years being in the business is the craziest thing i have ever heard of. the final point right at the moment, the

>> the fed, yes.o be making clear that they are going to be at this for a while, i mean, in the years, not in the months. >> doesn't it bode well for the stock market? >> it does, and people forget ben bernanke's term is up in january of 2014, and we don't know for sure, but it looks like janet yellin has a very good chance to take his place, and she's of the same view. we may be in the sweet spot of not great corporate earnings, not a great economy, but dos en won't last forever. >> yeah. but this brings me to the next question and that is if bernanke is not going to be here when it's time to clean up. >> he's not. >> what does this mean? he put all the stimulus in place and he leaves and somebody else comes in. i rec noise that they are in the same mindset on this stuff, but janet yellin is not the person who started this qe, and is this going to end badly in. >> it might. let's put it this way. we don't have any experience on how this ends because in our lifetime we've never seen a fed this aggress

the fed saying that it sees unemployment falling to 6.85% is in in 2014. that's the first time since the fed has been forecasting and making those public that it's been below 7%, a quicker pace of improvement in the unemployment rate could bring a near end to the fed's effort to stimulate the economy. and the fed chairman made comments about what's going on in cyprus and the economic and financial diiculties in that small country. so t of uncertainties and questions about how the way cyprus has created for other countries and the like. it does have some consequence. having said that, you know, the vote failed and the markets are up today. and i don't think that the impact has been enormous. >> finally, the federal reserve in its statement for the first time made mention of fiscal restraint, which is another way of saying the sequestration that many analysts did not think was going to happen. fed chairman did say that he has concerns that reducing federal spending could reduce economic growth. back to you guys. >> well, two big companies that could be consi

the fed is 80% of it. as far as how that relationship works, you much more often see people earn stocks when earnings are slow. they perceive it's much slower. >> here's another question for you, jeff. if the corporate section is doing so well, how come the federal reserve won't stop the stimulus? >> why not ease back? >> well, you made the case that it's profits. you made the case that it's profits. >> it's a great -- look. here's the thing. there's this terrible disconnect right now. bernanke talks about it all the time. between the corporate sector, the stock market, and the rest of the economy. jobs, incomes, the kind of indicators that actually mean the most for pocketbook issues. and that's what bernanke is targeting. that's the answer to your question. it's not a $64,000 question. we have a growth and jobs problem. that's what the fed is targeting. >> why do we have a growth problem if we have $1.9 trillion on the balance sheets of corporate america that's just sitting there? >> that's a good questi

the fed inflation target is 2%. it is the -- it is easy to imagine we come out of this with your 3% are 1% because the fed misti. they can missing either direction. the inflation hawks only talk about one direction, that the fed was still too slowly and we will get too much inflation. i think pretty symmetric danger on the other side. i can even imagine a range from four to two, two percentage point error. i have hard time imagining much more than that because of the need back that the fed will constantly be getting. so to think as you here sometime that we will come out of this with double-digit inflation because of all this money that's been created and won't be destroyed, that's a bet on the degree of incompetence by the federal reserve that i just don't see any evidence for. >> [inaudible] >> i appeal to the judge. >> my name is justin and am also an ordinary citizen. i have a question for you about something that you touched on earlier, i think also the new book, about the lack of prosecution towards offenders

the first fed official to say the fed is not easy enough and he's basing his calls essentially on -- his easier policy calls on the economic forecast. i want to show you what the three fed officials, they put their forecast. they're all saying unemployment will be above 7%, pretty well above it, in 2013. not coming down to 7% until 2014. kocherlakota said it would be down to 7% in 2014. if the labor market continues to be solid and my economic outlook remains favorable, i could then see a basis for slowing the pace of asset purchases, says sandra pianalto. that does seem very much in line with what fed chairman ben bernanke said at his press conference last week. so the doves taking to the air. and now we know that kocherlakota is not among those centrists that some people were worrying about, perhaps more in favor of considering the costs of qe rather the benefits. bill? >> steve liesman with his finger to the wind in federal reserve land. thanks, steve. see you later. >>> heading toward the close, here we go. is today finally the day? we have an all-time high for the s&p. right now

and it's not the fed. the fed is almost a barrier. with balance sheets that are strong, good profits, really done a great job in the last four or five years. what you have to worry about is smaller business, unincorporated businesses, which we touched on earlier, they're the ones not benefitting from 0 percent interest rates. like the soviet union, the food was free, but you couldn't get any. >> we pretend to work, you pretend to pay us. >> what i'm concerned about the fed is the punch bowl is great, but the fed balance sheet could get to $4 trillion. think of that as a percentage of our gdp. the concern we better start talking about is how is the fed eventually going to unwind thissel balance sheet. that is a concern. >> is that a stock market concern presently? >> no. >> and would you go in and buy bank stocks right now? >> look, i would buy financials. financials are benefiting from the improving economy, the improvement to housing. the fact that deflation is really coming off the table as a risk. i would own financials, and i like

fbfh is the fed bull from hell. that's my new term on how so many people are focused on when the fed is going to stop buying the bonds it accumulates every single month to keep your interest rates low, your mortgage low. and when is the fed going to start selling its to stock boosting in the stock market. so many prognosticators think in one of these meetings, maybe this one, bernanke will signal that things have, oh, no, gotten better. and that's code, that's code for the great unwind is upon us that the fed bull from hell is unleashed from on high and nobody ever made a dime getting hit by lightning. so if we sell off in wednesday's meeting you know it's the fear or the fbfh at work, okay? repeat after me. when the fed starts selling its bonds, that's the end of the world. isn't that what people say? except for fuddy duddy old me. we're trying to make money or save money. you know i like tech. it's the part of the stock market that's still cheap. has been buying a bunch of tech stocks. but there's one sector of te

>> more fed induced than anything else. people are desperate for yield, and they have pushed us in a more risk-on assets, and that's what's happening. >> is there a danger to that? i mean, a lot of people worry that the fed at some point, you know, with all of this free money, it's going to end badly. what's your take on the implications? >> i don't know the answer to that and no one does. gone from 1 trillion to 3 trillion. >> in the balance sheet. >> and we're to go to 4 at the end of this year on the current plan of 85 a month so obviously it's scary, uncharted territory, but the fed chairman seems to think he has the way to unwind this at the right time without severe consequences. let's enjoy the party. >> and when you're talking to management teams, i know you're working with a whole host of companies right now, when you talk to management teams, do they feel like this is a positive for them? do they not worry about stock prices? is there a wealth effect? what do they say about it? >> maria, the best way to look at th

meet the fed less.ook, the fed doesn't want to be where it is by any stretch of the imagination. it would much prefer ton buy $85 million in bonds every month and prefer the government not be in the process of cutting spending, not leaving all of the stimulus to the federal reserve. if we get into position where those things turn around with, you can imagine the market being okay with that. >> thank you gentlemen, very much. >> stocks at all-time highs sue, someone might make them go higher. see who has the power to do it and when they may be likely to pull the trigger. if you'd like vc money. who wouldn't? don't move. >> coming up, power pitch. start-ups that give us their 60-second pitch. >> my name is nathan richardson. i'm the co-founder of way wire. >> we give you the fast pitch of venture capitol. >> i think my primary concern is in the execution. >> do these founders have what it takes? >> in or out on waywire? >> stay tuned it find out. [ indistinct shouting ] ♪ [ indistinct shouting ] [ male an

. >> it gets a little wonky, but the fed chairman did point out, we fed governors, we're sort of learning as we go along here. they're making this up, because this is unprecedented, this bond buying program, this quantitative easing, as it's known, that they've been going through. they're refining the policy as they go, and i think they are certainly mindful of the impact they could have, if they suddenly put the brakes on this plan, rather than kind of tapering it off, which is what they're starting to signal they're going to do. >> they're signaling that. although you read the headline, they could slow it down or stop it at any time, but they can continue it as far as they want to as well. so they didn't give a real clear indication, but i think what they're doing, they're telling you that they're focusing in on that, and that's something they're going to be mindful of. >> bottom line for you as a trader? you're going to hang in here with this rally continuing? >> obviously. the higher you go, the more trepidation you'll have, but i would be a buyer on any of the little pullbacks we're

- >> it doesn't. >> people rebel against the fed. they rebelled against the fed in the late '70s. don't forget, j. william miller, then chairman to have the federal reserve, had this idea if you only printed more dollars, things would become better. they didn't. then markets rebelled and interest rates went up and up and up, and then came paul volcker, with the most draconian policy to put things right, with terrific attention to human suffering. it seems to me something like that will happen now. markets are enthralled to these central bankers. it's astonishing after so many years of demonstrated human error on the part of these mandarins, people still seemingly trust them. but they do, for now. they won't always. >> well, we'll be watching that. you hope it doesn't end as badly, but certainly, we've got history on that side. jim, good to have you on the program. >> thank you, maria. >> thank you for your brackets and your analogy to march madness. >>> up next, nike is named after the greek goddess of victory. do they have victoriou

the fed meeting kicking off today.a housing rebound with starts rising last month and permits rising to the highest levels in '08 and as for the picture in europe. german confidence hitting the highest level in three months and everyone will focus cyprus and what will happen in three hours' time when there is expected to be a vote. a major bounce in japan with expectations running high ahead of the leadership change ahead of the boj tomorrow. >> the bull keeps on going after yesterday's 69-point loss and a bounce expected today as investors look to the fed. it kicks off its two-day meeting today with the best conference tomorrow. meantime, the vote is scheduled in cyprus hours from now and the latest deposit tax scheme. happy anniversary, apple dividend and it was a year ago when the tech giant announced its dividend in 17 years. will apple succumb to the bigger payout as it faces stiffer competition from samsung. lululemon doing the downward facing dog with the transparency with the iconic black yoga pants prompting t

a lot depends on the fed. fed is feeding this economy and market on morphine, but there comes a point where more morphine is doing harm to the patient. and the big question is, when and if the fed is going to withdraw the morphine dose in order to save the patient. >> is it doing more harm than good right now? >> i think it's going to and it's crowding small companies out of investment. there's no return. people with these falsely low interest rates, i think, are actually hurting the economy now. if we bought time for the restructuring of the economy, but the government's hindering restructuring. >> michael? >> i think that john certainly makes sense. and these short-term calls are always dicey. but if you're going to say which direction the most likely next 500 points is, i'm going to say stick with the trend and it's going higher. not necessarily, as john has said, for good reasons. i mean, i remember, there was this pretty girl in high school who said she'd go out with me one night, only because if she stay

the fed did speak. they're using one of the measuring sticks of how they're gonna keep this liquidity going which is unemployment. that 6 and a half percent mark is where we're looking. we are not there yet by any means but again, we're gonna watch that existing home sales number coming out this morning and see if that's gonna be a catalyst for further upside because the housing sector has been and was very active yesterday and we're gonna see if that continues today. > >what do you think about oracle? the company missed on revenues. > > yeah, they actually missed on software licensing and that's a very important part because that's where the growth was coming in previous earnings. and also it looks like a byproduct of what's going on in europe and in asia. especially in europe where, again, they have a lot of diverse offerings other than the clout. and those earnings got hit over there because obviously we keep getting the headlines out of the eu and that impacted oracle and they missed. > >and as a ma

you just said the fed expects it to rise. tell me why. >> because what we expect to happen, there's some decline in participation there because there are people who are retired. they're leaving the workforce as they age. that's expected. but there's a bunch of people who are out of the workforce and completely stopped looking for work because they're discouraged. a better jobs market should pull them back in, increase the participation rate, and make it harder for the unemployment rate to decline because there's more workers. >> mike santoli what keeps the rally from moving higher? what's the one thing out there that you're worried about? if the fundamentals of the economy continue to show improvement to the way they are, you've got the fed backstop always in the game, what is it out there right now that worries you? >> think i it's theact that we've had a couple of sequential declines in reported earnings and i think what we're going to have, i want to see how the market absorbs this. as the march ends and we get into april,

the fed saying that the biggest u.s. banks have enough capital to with stand a severe economic downturn. get this, only allied financial didn't pass this round of stress tests. the lender didn't mean the minimum hurdle of a 5% capital buffer. next week, regulators are going to announce whether banks can start returning mope to shareholders in the form of dividends and buybacks. kayla tausche will join us with more on the details of the stress tests in just a couple of minutes. ally criticized the fed. how do you criticize your regulator? you don't understand how that works. >> they feel like they have to tas say something. this is allied, which is the old gm. >> it's all the ads. >> you've seen the ads with the kids saying we're the brand new one. where they don't treat the kids fairly. one gets an ice cream and the other doesn't. >> cdw has reportedly hired banks for an ipo later this year. the company was taken private by equity partners for $7.3 billion in 2007 been we're going to see how that ipo is openly valid. and

they're still below the pace of the fed. the fed buying at $85 billion.hey also lengthened out the timeline of the federal reserve, as you'll see in the next chart here. this is when they thought they were going to stop qe, in november of 2013. that was in our january survey. and now, all the way over here, they've added about six months that they think qe will be going on for. however, they do believe the fed will taper those purchases. that tapering, originally, we thought, was going to start in december of 2013. and now they've moved that ahead again. now it's more of a january. that's the average of all of the responses. how about the more important question about when will they finally hike interest rates or sell assets? sell assets, that's moved actually back. it's the only one that's sort of a tightening, although i will tell you in a separate question, half of the people think the fed will not sell any assets whatsoever. how about hiking rates? that's come down at about the same place it was, just the fourth quarter of 2015 average response is wha

bb&t did not pass muster with the fed.n executives will be on capitol hill this morning and they will address a senate mantle on the london whale losses. the bank ignored warnings and cost it $6.2 billion. it is a discussion we have had already around this table and we will continue this hour >> another carnival cruise ship is dealing with a problem. legend will have to skip a stop because of a propulsion number which has cut its speed. it is expected to address its recent problems during a conference call. live from the miami port. that in just a few minutes. boeing sees its grounded 787 jets returning to commercial service sooner than many had thought. we will see if they actually get there. >> the impact everybody used to put a good team under this, find out what the problems are and quickly move through it. >> chief project engineer made those comments during a visit to tokyo. he said a new battery design has multiple safety guards to prevent overheating. boeing completed a third of the safety tests scheduled. >>> one

so much so the chairman to the fed when he faced a similar crisis and recognize the role of the fed and contraction ary monetary policy. that shows avoiding one mistake does not prevent others. hence peter wallison book, a task no less daunting than that faced by a lew friedman and shorts facing an economic disaster and the lessons learned that led to policies and institutions institutions, that must change, will bring on for their calamity. i applaud the effort and i appreciate the format of the book. when i first got it i thought a couple hundred pages of new ridings from peter that i thought this is stuff i have already read but there is new stuff in there to. these essays are important because it was written while the crisis was unfolding, and begin when then it can't -- kindling was set, lighting the match match, a finning the flames, letting the embers smolder and not put them all. what do we love to have similar as aids one negative essays from friedman and shorts after the depression? they were looking backwards. we have the opportunity to live with essays that talk about and co

and how will the fed and how much will the fed taper? >> i think the unemployment rate could still be around 7.5%. i think what they'll be looking at. remember, it's the outlook, not where unemployment is today. and what they need to see is gdp consistently performing above frie trend, which is about 3.2%, if they believe gdp is consistently growing in excess of 3%, that's enough to improve the outlook for the labor market. and i think, you know, by the second half or, you know, by the third quarter even, we'll have some convincing evidence that at least we're on the right path. >> okay. so the tapering, what -- how do you think that will look like? will it be by a lot? at that point, if that is what comes to pass, your forecast, how much will -- >> i think initially it'll be very small because i think the fed is concerned about a backup in the treasury yields. i think they'll try to do everything in their power to make that transition as gradual as possible. i don't think it will work. i think the market will try to front run them the s

he can't let the fed's part in the drama be repeated.therwise he'd go down as the fed chief who never got the economy going and put it back in a recession, a recession in a great recession. only world war ii ended the depression. and bernanke is not banking on being rescued by that kind of catastrophe. some people who don't know history are pressing him to do so. he's cognizant that we have seen the economy get hot and each time it's fizzled. he knows that things can be more fragile than they seem. he set the goal of 6.5% unemployment, nowhere near where we're right now and he'll wait until we get there until he decides to tighten. don't you wish you go back to 1937 and you could undo what the fed did then? i know bernanke would love to go back there. the depression would have ended years earlier. bernanke knows that's no do over. he'll play it safe the way his predecessors should have played it 76 years ago. consider what we heard today. i was on the street signs with brian and mandy and an intelligent guy thought cyprus would be the ne