it is a range of opinion that was at the fomc. it range from five percent to six percent. we remain well above that. some broader measures of the labor market overfocus on the unemployment rate. the degree of involuntary part-time employment remains exceptionally high at five percent of the labor force. broader measures of unemployment are even more elevated, relative to normal and standard unemployment rates. there is an unusually high incidence of long spells of unemployment. via number of measures, our economy is not back, and the labor is not back to normal. >> the chair recognizes the chairman from alabama for five minutes. >> thank you. last week the governor appeared before the committee and said that the clo ownership issues was at the top of the issue for the interagency working group. what additional information do you need to resolve the clo issue and clarify how legacy securities will be treated under volcker? >> this is something a number of banking organizations have asked the regulators to look at. regulators recently issued a ruling, and this is something t

she has not been running the fomc.k only get to march, will get a little bit more out of her in subsequent hearings. but tomorrow, i think she needs to be rather cautious. >> the feds economic forecast them a if it is off, will she be able to him and congress that they will pivot if conditions warrant it? >> i think she needs to convince the markets and investors more than congress. she has to be deferential to congress, but i don't think they are her target audience. this is where she needs to walk a tightrope explaining why the fed's forecasts are credible, and at the same time saying that they will use other tools if necessary and doing that without spooking the markets at the same time. that is a rather delicate balance. but i think she's up to the task. >> employment is close to that six point five percent threshold that the fed said under ben bernanke. michael just alluded to that. but the central bank is still easing its policy and buying bonds at a reduced rate. what might that forward guidance under janet yell

my colleagues on the fomc believe that unemployment will expand this year and next. the unemployment rate will continue to decline toward a longer run sustainable level, and inflation will move back toward 2% over the coming years. we have been watching closely the recent volatility in global financial markets. our sense is, at this stage, these developments do not impose a substantial risk to the u.s. economic outlook. we will, of course, continue to monitor the situation. turning to monetary policy, let me emphasize that i expect a great deal of continuity in the fomc's approach to monetary policy. i served on the committee as we formulated our current policy strategy. and i strongly support the strategy, which is designed to fulfill the federal reserve's statutory mandate of maximum employment and price stability. prior to the financial crisis, the fomc carried that monetary policy by adjusting the target for the federal funds rate. with that rate near zero since late 2008, we relied on to less traditional tools, asset purchases and forward guidance, to help the e

>> you have to watch the fomc minutes, out at to :00 eastern, there was a time when earnings and newceo diagram nated the economy,,these days federal reserve. >> parameters, what will move the market? if they hint at we'll reneg on ben bernanke's promise. stock market doos what? >> any hint that taper is off, i think you could see the stock market move higher, in the indication that the harrow inis back -- hero kno heroin is back on. >> i agree, watch economic data, you look at fomc minutes, at the housing starts, you look at ppi for any hint that soft patch we're seeing in the economic data is weather related, and growth continues, you need to watch tesla earnings tomorrow night, they are grand-daddy of all momentum stocks, if they do well, that should keep some valuations lofty, if they don't you get a halo effect. charles: i disagree with jonathan at this ., i think if fed goes back to their decision they pump the prime to pump it more, i think that street will be disappointed, at this ., i am seeing good news senses market up, bad news send its down, there has to be a . where mar

my colleagues on the fomc and i anticipate that economic activity and employment will expand at a moderate pace this year and next. the unemployment rate will continue to decline toward its longer-run sustainable level, and inflation will move back toward 2% over coming years. we have been watching closely the recent volatility in global financial markets. our sense is that at this stage these developments do not pose a substantial risk to the u.s. economic outlook. we will, of course, continue to monitor the situation. mr. chairman, let me add as an aside that since my appearance before the house committee, a number of data releases have pointed to softer spending than many analysts had expected. part of that softness may reflect adverse weather conditions. but at this point it's difficult to discern exactly how much. in the weeks and months ahead, my colleagues and i will be attentive to signals that indicate whether the recovery is progressing in line with our earlier expectations. turning to monetary policy, let me emphasize that i expect a great deal of continuity in the fomc's approa

chair yellen you just selfed that, quote, i expect a great deal of continuity on the fomc's approach to monetary policies. i'll ask the obvious question, important guidance, which has been somewhat anchored in the evans rule seemingly said monetary policy will not tighten until unemployment drops below 6.5%. now chairman bernanke announced that or he described this as a taylor-like rule, although professor taylor, who we'll hear from later, may not agree, be that as it may. we stand on that threshold, and so i also see in your testimony where you said crossing one of these tlesh holds will not automatically prompt an increase in federal funds rate. i guess to some extent the editorial writers in "the wall street journal" anticipated this and opined two days ago in respect to the evans rule, quote, perhaps the open market committee should have called it the evans suggestion. quote the mistake was telling markets there was a fixed rule and the only sure thing at the fed is more improvisation. so who's right here? is "the wall street journal" that we are -- that these thresholds are ee

for us, after yesterday's fomc minutes, there's this battle going on between the two groups in the fomc, the u3 unemployment rate, that's what matters. the other says look at broader measures of unemployment. i don't know how we settle that dispute in the near term, steve. it seems to me we have to look to the cpi data and other inflation data to do that. if the folks who focus on the u3 unemployment rate, inflation should be ticking up here. we should see upward pressure on wages. i haven't been able to dig into the details of the report. as you suggest -- >> there is none. >> we're not seeing that. >> 1.6 year on year for core is below the target, of course. it's been hovering for eight of the last ten months. something seems to be more than transistor transitory. there's broader weakness in the economy, in the labor market than people, maybe the more hawkish members of the fomc believe. >> hey, rick -- >> yes. >> rick, i don't think the fed men to the signal it was going to be raising rates any time sooner. i know the stock market got up upset by this. when i look at how the fixed in

identify think that's something that the fomc and chairman yellen will be struggling with.ay to articulate this. they'll see how the labor market evolves before the next meeting or just the next month before the next meeting. and they'll be thinking about other indicators, so my guess is eventually we're going to get there but not immediately. >> when you think about, randy, the closing remarks on regulation, some people in the market took that as a throwaway, she had to mention it because people in congress are very concerned about that but it does seem like she has very specific benchmarks there as well for the leverage ratio putting that into place. do you think that there will be a considerable amount of time spent on that in the "q" and "a" portion? >> i think so. if you look back at the confirmation testimony last fall it seemed to me there was more time spent on the regulatory issues rather than the monetary policy issues and these are front-and-center issues right now. there are a lot of different approaches. the fed has one approach. the banking industry has anothe

>> you have to watch the fomc minutes, out at to :00 eastern, there was a time when earnings and new the economy,,these days federal reserve. >> paramets, what will move the market? if they hint at we'll reneg on ben bernanke's promise. stock market doos what? >> any hint that taper is off, i think you could see the stock maet move higher, i t indication that the harrow inis back --ero k heroin is back on. >> i agree, watch economic data, you look at fomc minutes, at the housing starts, you look at ppi for any hint that soft patch we're seeing in the economic data is weather related, and growth continues, you need to watch tesla earnings tomorrow night, the are grand-daddy of all momentum stos, if they do well, that should keep some valuations lofty, if hey don't you get a halo effect. charle i disagree with jonathan athis ., i think if fed goes back to their decisn they pump the prime to pump it more, i think that street will be disappointed, at this ., i am seeing good news senses market up, bad news send its down, there has to be a . where market trades on good news. >>t is -- not

. >> i expect a great deal of continuity in the fomc's approach to monetary policy. i served on the committee as we formulated our strategy. i strongly support that strategy. >> as you know, republicans have promised some very strong peter: republicans promised strong oversight, the first year in charge of the central bank, the 100th anniversary of the fed. they started this morning with some tough questions. back to you. dagen: she is getting her capitol hill legs. slowly, but surely. connell: the stock market seems to like it so far with the dow up nearly 100 points. nicole petallides joining us from the new york stock exchange. nicole: good morning. the testimony came out earlier. we are getting much of what we expected. she talks about economic signals and the economic growth that we need. 50,893, posting gains of 1/2% for each, the fear index is to the downside by 4% so the markets here, they are buying everything. transports oil services, etc.. dagen: for more on janet yellen's testimony, what it means for the future of federal reserve policy. senior fed econom

based on the last meeting it seems that the fomc had a significant discussion about revising down the forward guidance which originally stated and considering raising interest rates once the employment fell below the threshold of 6-5. in her testimony before the house, you indicated earlier this month that the threshold would not be the only factor that is taken into account. policymakers would be looking at what you called a broad range of data on the creation and other indications. so it seems to me that they offer a more positive approach rather than the threshold of 6 6-5. given the importance of the guidance which is these days more than ever into the reality that to be effective the guidance must be trusted by the market, what you agree with the president who said that he would favor discarding the threshold and much more work towards the qualitative approach and giving more flexibility if still get the market guidance? >> there are many different views in the committee about what the right way is to cast forward guidance and this is something we have been dating for a long time

with dimensions of inflation, the fomc had certainly changed its focus.mber, the rate plunged to zero. they were urging more, faster, we need to get on this. within three months, a great deal had been done. since then, we have been trying to do it. fedome sense, i think the has responded. to your credit, you look better in those minutes than some of your colleagues did. that is the past. you look at the future. i want to follow-up on some of the too big to fail questions. you said addressing too big to fail is among the most important goals. you mentioned capital and resolution authority and long-term debt requirements and supplemental leverage ratio and a living will to break up institutions that they impose upon a grave threat to the financial system. despite all that, the nation's foremost expert on banking r governors, you ar said on tuesday that we are, "not even close" to ending too big to fail. it has been five years since the crisis. you have the tools. why's it taking so long and when is this going to be resolved echo when cad? when will the amer

of course, there's still some confusion from the fomc statement today.xactly certain myself what's going to happen next, but clearly they're going to have to come with a mechanism that's not static. anytime you assign a static number to the u.s. dynamic economy, you're going to have to revise it. >> but this is what's so ironic. we went through this whole exercise about how we needed to have targets. charles evans was like we have to quantify this so people understand what we're doing. they're like that worked for a while but it's not going to work anymore. what comes next? >> i take the same view here. it's a work in progress. again, this is a relatively new concept for the fed. the economy has got a lot of moving parts. i do think that them calling audibles along the way is something we should expect. >> it's like when an analyst puts a price target on a stock and it hits it. now what are you going to do? we're gets close to the 6.5% bogey on unemployment -- let's go to the breaking news. nbc's pete williams has more on what -- there may be a terror th

all of this, building up to the fomc minutes. the analysts will gesticulate. the economist will bloviate, investors will speculate, but peter barnes articulate what it means to your money. peter? >> adam, without a big change in its economic outlook the fed plans to keep the taper on track. that is the big headline from the minutes of the fed's last policy meeting. that was ben bernanke's last meeting as chairman by the way. at the end of january when the fed voted to keep tapering its billions of dollars of monthly quantitative easing bond, bond purchases. the minutes say that several participants argued, quote, in the absence of an appreciable change in the economic outlook there should be a clear presumption in favor of continuing to reduce the pace of purchases. fed members also talked about changing their other main policy tool, their forward guidance on the likely direction of interest rates. they have been saying that they will keep short-term rate, the fed fund rate, low, well past the point, the unemployment rate hits 6.5% but quote, participants agre

i don't want to speculate on what our future fomc statements are look like. i will put in some perspective. when we introduce a threshold there were various time/date threshold and unemployment threshold. there was uncertainty about what we were thinking, what our policy plans were. i think that the threshold really served us well. now in a current situation where the economy is doing better, my own view is we should move back to more of a verbal description used, projections, speeches. our statements are qualitatively guide the public about what our views are and not rely on some kind of marker or hard numbers to, you know, in our statements. i think it's a sign of success. we've got unemployment down to closer to full employment. still got a ways to go. but i think it's time to move away from the numerical mackers and go back to a more qualitative description. >> scott -- >> steve, thanks so much. president williams, have a couple questions for you. how would you say the fed is thinking about the taper as it relates to some of the issues that have taken pla

my colleagues on the fomc and i anticipate that economic activity and employment will expand at a moderate pace this year and next. the unemployment rate will continue to decline toward its longer-run sustainable level, and inflation will move back toward 2% over coming years. we have been watching closely the recent volatility in global financial markets. our sense is that at this stage these developments do not pose a substantial risk to the u.s. economic outlook. we will, of course, continue to monitor the situation. mr. chairman, let me add as an aside that since my appearance before the house committee, a number of data releases have pointed to softer spending than many analysts had expected. part of that softness may reflect adverse weather conditions. but at this point it's difficult to discern exactly how much. in the weeks and months ahead, my colleagues and i will be attentive to signals that indicate whether the recovery is progressing in line with our earlier expectations. turning to monetary policy, let me emphasize that i expect a great deal of continuity in the fomc's approa

the fomc minutes for january's meeting will be released. wednesday, the president will be attending the north american leaders summit in next co. >> on friday, existing home sales for the month of january. >> sd >>> finally, the numbers you need to know for derrick jeet terse retirement. 250, the nest egg he has built for his retirement. the second number, $1,153. within a few hours of his facebook announcement wednesday that he would be retiring at the end of the 2014 season, that was the average price of one ticket to the captain's last home game in the bronx, barring a trip to the postseason. these numbers were all on resale sites. the yankees will put single game tickets on sale on tuesday. >>> that's the show for today. i'm becky quick. thank you so much for joining me. each week, you can keep it right here. we are "on the money." i'll see you next weekend. >> narrator: in this episode of "american greed"... solomon dwek is an expert flimflammer. >> here was a guy that ran a $400 million real-estate ponzi scheme in his head and on the

prior to the financial crisis the fomc carried out monetary policy by adjusting its target to the federalfund rate. with that rate near zero since late 2008 we have relied on to less traditional tools, asset purchases and for guidance. to help the economy move toward maximum employment and price stability. both tools put downward pressure on longer-term interest rates and support asset prices. in turn these more accommodative financial conditions support consumer spending, business investment, and housing construction adding impetus to the recovery. our current program of asset purchases began in september september 2012 amid signs that the recovery was weakening and progress in the labour market have slowed sphere. the committee said that it would continue the program until there was a substantial improvement in the outlook of the labour market in the context of price stability. in mid 2013 the committee indicated that if progress toward its objectives continued as expected in moderation in the monthly pace of purchases would like to become appropriate later in the year. in december the

that's what i was about to say, the other main message she conveyed, i've been sitting at that same fomc table for many years, the san francisco fed, advice chair of the fed, don't be surprised when i tell you we're going to have continuity with what's going on. >> the federal reserve, it's really shown in the last five years the ability to stand up and be the adult in the room when congress wouldn't be. but in the end when you look at our problems of income inequality, of people struggling to get in the middle class and in many cases slipping out of the middle class, this is policy that is more specific and gran i couldn't lar than the fed can actually direct. >> i agree with that. to your credit, ali, you've been saying that long before, now everyone is saying that, but you were saying that years ago before that ever became a major issue. i think you're right. the fed is doing what it should be doing. it's acting as an adult, it's trying to keep the economy going, but it's tools are pretty limited. they're pretty crude. and fiscal policy and just the private sector recovering on its ow

guillen will cheer her first fomc meeting in march. an us stocks of bob rose following a yell and testimony. the dow jones industrial average closed at fifteen thousand nine hundred and ninety four up one point two percent the nasdaq closing at four thousand one hundred ninety one also up more than one percent the second hive tokyo share prices are starting this wednesday morning for that in the military joins us from the tokyo stock exchange mean good morning out with some catching up to hear and touch after the holiday on tuesday and a key figure was up before markets opened on cars more about that exactly live in a catch up to do and we had to japan's machinery orders the dinner just before markets open. which was down fifteen point seven percent for december. not a lot of analysts of may to analyze that and say that that was a reaction to the surge. we saw in november. let's look at the opening doubles for today every twelfth and pretty positive so far up almost one percent for the nikkei fourteen thousand eight hundred and fifty f

if she doesn't, then there could be some real concern that the fomc about the slowing u.s. data. elsewhere in corporate news, keep an eye on dealt yachlt interesting they're changing the frequent flyer program. it's not now how many miles you travel, it's about how much you spend. and this is following what other airlines have done in the u.s. around about 4% of delta flyers actually have 25% of revenue their the ones that delta wants to recognize and reward going forward in 2015. >> absolutely. americans love their delta sky miles. that's for sure. so that will be a big come uppance for a lot of people who rely on those to cash in on those miles. steve this got our attention. boeing unveiling this spy phone. >> yeah. boeing making phones. it's not something manufacture would you say have associate with. but it's very james bond like. this is tamper proof. it incrypts phone calls as well. if you try break open the casing, apparently deleets all the data as well. this is very interesting. we heard from fcc filing that's it's going to be aimed at governments and government contract

was about to say is the other main mention that she conveyed was, i have been sitting at that same fomc table for many many years. the san francisco fed, vice chair of the fed. don't be surprised i am telling you we are going to have continuity with what's been going on. >> austin, the federal reserve, it has shown in the last five years the ability to step up and be the adult in the room when congress wouldn't be. but in the end, when you look at our problems of income inequality, of people struggling to get into the middle class and in many indications, slipping back out of the middle class, this is -- this is policy that is more specific and granular direct. >> i agree with that. and to your credit, ali, you have been saying that long -- now, everybody is saying that, but you awere say that years ag before that ever became a major issue. i think you are absolutely right. the fed is doing what it should be doing. it's acting as an adult. it's trying to keep the economy going, but its tools are limited and crude and fiscal policy and just the private sector recovering on its own are fa

. -- fomc. you would have to bet against it. there would be questions to ask. you would want to know not how much slack they think but can they wait until it gets higher without going into too much ego speak? can they let inflation run a little ahead of itself? do they feel they have to get in front of it? what is her philosophy? >> when you take a look at what congress is saying, are the even thinking about inflation? >> they do care about inflation. some republicans will raise the threat of inflation down the road. they been talking about it for a while. the thing i'm going to be watching for most closely is the performance. the firstke, i member couple of times he testified there was a little bit of a lip quiver. she has testified a bunch. i am not sure what kind of janet yellen we get. she's the kind of person that can tell markets. >> you bring up a very interesting point. i just wonder, this is the first female head of the central reserve. dan clifton, how much of that comes in? when the fed tries to respond or not respond to a taper tantrum, the fact tha

of the latest fomc meeting last month. time now for futures in focus. shrugs off weaker than estimated housing data. for more on the world's third seniordely used metal, a comedy broker on the floor of the cme. phil, a lot of the recent misses blamed on the cold weather. is that the feeling on the floor this morning? >> if you look at the market like copper, you have not seen any kind of impact whatsoever. the market has been rising significantly in coming off of its lows. what i'm looking at doing is establishing long-term positions to the upside in the copper market. some of the fundamentals currently, the london metals exchange. stock isles have been down 75% since last march. you also have a ban on exports from indonesia. it is creating a lot of tightness in the global copper stockpiles. china, although they have been doing some tightening and they had mixed activity, they have been building stock piles quite aggressively and i think they are concerned about the shrinking supply that is out there. so i think copper prices with the rising volume, the

number two, the forecast of the current fomc long-term forecast for the interest rate is 4%. combine that with the 2% inflation target, 2% real interest rate, that is exactly what the rove recommended 20 years ago. there's a consensus now that the reaction of the central bank and the fed in particular should be greater than one when inflation picks up. there is debate about what the reaction should be in the case of a recession. some argue it should be larger, some smaller. that is a difference of opinion. it before the reason why i think we are in a position to move in this direction more so in the past is statements of chair yellen herself. she has indicated that policy rules like this are sensible, good, they work well. she emphasizes that in normal times. these are not yet normal times. there's debate about when we will get back to normal, or whether we all are already back to normal but it seems to me therefore that the debate is not over whether we should follow a policy role like this, it's about when. thank you, mr. chairman. >> dr. calabria, you are now recognized. >

the minutes up from the latest fomc meetings says the fed is on track to continue with gradual taperingier, i asked kevin from ifel if this is a signal for investors to leave the market. collect the returns from here probably will not be as great as they were the last few years. that's for sure. the economies growing and we have better than 8% growth and that is a big surprise that not many are talking about. that's not really a big stretch. i don't see a real reason to run from the market. >> today's insight and action, they took a look at the case for investing in equities. the most compelling argument beating him bullish all year i'm sharing with insight and action brought to us from a strategist over at rbc. he went back 40 years and found an incredible correlation. gdp, gross move in domestic product, leading to a 2.5%ent growth of sales -- growth in the s&p 500. this is what you call operating leverage. in his own words, here you go. if gdp accelerates later this year, consensus estimates are too low especially for the banks and industrials. banks make loans and they are levered.

and in the minutes from the last fm omc -- fomc meeting, they were looking for a clear presumption inavor of continuing to reduce the pace of the fed bond purchases at each meeting. those are the top headlines. back to you. >> ok, thanks so much. let's get back to our top story, tesla and the earnings release. the company hit a record stock price yesterday. i published report said a member head of met with the tesla, elon musk. is there any truth to that rumor? for more, we bring in bloomberg's hard guy, matt miller, and an automotive joins us. he is publisher and editorial director of 9-to-5. are from near manchester, vermont. matt, i am going to kick it off with you. we have been talking about this momentum for a day or two to leo. is there any momentum behind this? >> absolutely not. but it is fun to talk about. in journalism is a real key to a fun friday, and i guess it is only one day, but, look. unlikely, but it is so much fun. it is like the net butter and chocolate. it would be good if tesla used the apple operating system. like a superhero. he could be the new steve jobs. tha

all of this, building up to the fomc minutes. the analysts will gesticulate.ans to your money. peter? >> adam, without a big change in its economic outlook the fed plans to keep the taper on track. that is the big headline from the minutes of the fed's last policy meeting. that was ben bernanke's last meeting as chairman by the way. at the end of january when the fed voted to keep tapering its billions of dollars of monthly quantitative easing bond, bond purchases. the minutes say that several participants argued, quote, in the absence of an appreciable change in the economic outlook there should be a clear presumption in favor of continuing to reduce the pace of purchases. fed members also talked about changing their other main policy tool, their forward guidance on the likely direction of interest rates. they hav

to the fomc, the tale does not wag the dog. >> what else is on the agenda? >> growth.ve seen an improvement, but how many people are convinced by it? the issue going forward is that we have seen broad-based tightening and emerging-market economies. central banks are raising interest rates. how does that feed into global growth? outside of p.m., the data has hardly been inspiring. there is a lot of concern about what is going on in china. are fivem line is, we years since the financial crisis began. monetary policy is still center stage. you so much, jonathan ferro with the latest on the g 20. joining me now for his views on is the head of emerging markets cross asset strategy at ubs. great to have you on the program. we will get to ukraine very quickly but i want to get your take on the g 20. first of all, the g 20 also comes under a lot of pressure. it is still important to meet and talk face to face. we knew what the fed was doing. it was very clear. they couldn't have signposted it any better. >> i think it is especially strange that central bankers across emerging

still not seeing employment being driven to the degree that we would like to see it at the fomc, but has improved. recovering 90% of the jobs lost in the great recession. >> we are definitely seeing sentiment improving, but wouldn't say sentiment is great. whether it is a formal cataract or dodd-frank which is still hampering a lot of businesses from probably hiring, from expanding. still trying to figure out how this is watering through the economy. we have the weather affect. yet another polar vortex bearing down on the united states, so the economic data smooth this out over the next couple of months how much i'll back we seen in recent spending and how much in the shift of the economy. one other thing missing is natural gas and propane prices have absolutely skyrocketed. average american is paying a lot more this year than they were last year for these fuel costs. hoping for some sort of relief but probably causing them to tighten down on their spending a little bit so we need to see what the effects of this are. probably why the fed is not aggressively doing ttpering right now b

>> the fomc minutes out at 2:00 eastern. when the earnings their product development dominated thefede economy. so those minutes are market movers.t >> so if we go on to the promise the economy has not turned a corner the stock market does what?th to make any sense the tapere is awfully concede that move significantly higher with the indication that the hair a win is back >> everybody likes said until they tell. [laughter] >> i agree. look at the fomcou l you look at the housing starts, it for any hint thatda this soft batch is weather related but i also think watched the tesla earnings tomorrow that is the granddaddy of all but some stocks.e if they do well it shouldt keep the valuations lofty otherwise you will have the halo effect. >> i disagree if the fed goes back to prime the pump the street will be disappointed. but at some point there has to be reality. i know it is old-fashionedt i thought the kid you help me? >> no. a as long as the fed continues to taper they will all they do it if the economy is sound dated if th

you one of my 5 rit, i think, biassed will below upside, we'll watch fomc, thank you, thank you forevethank you for watching. lou: president obama seems to have settled into his rule by fiat, today mr. obama advanced his global warming agenda orders epa is create fuel regulations for big trucks. tonight, protests turning violence and deadly on streets of key aantigust demonstrator clashed with ukrainian police. the conflict between the ukrainian different and the demonstrators has reach a critical poin. it i point, is u.s. government negotiating with terrorists? reports that negotiation are issue way for release of only remaining p.o.w. in afghanistan, taliban demanding release of a gay da guantanamo bay terrorist. >> tonight, president orders epa to develop new fuel efficiency standards for heavy duty trucks. mr. obama took a moment to brag about his recent actions. >> over the past 3 weeks i've required federal contract or to pay their employees a fair wage of at $10.10 an hour, i directed treasury secretary to crade my ira. we brought together business leaders who committed to help more

i expect a great deal of continuity in the fomc's approach to monetary policy, specifically on assetg information broadly supports committee expectations of ongoing improvement in the labor market conditions and inflation, the committee will likely reduce the pace of asset purchases in future measured steps at future meetings, however, chairman yellen says, purchases are not on a preset course. decisions about the pace will remain contingent on the outlook for the labor market and inflation. as far as the fed funds rate policy and the targets, the targets are for 6.5% unemployment and 2% inflation, remains. however, again, chairman yellen saying crossing one of these thresho thresholds. turning to the broader economy, the economy recovery gained traction in the second half of last year. nevertheless, the labor market is far from complete as far as the recovery there. the housing sector recovery slowed in the wake of mortgage rate hikes last year. overall, economic activity and employment will expand at a moderate pace this year and next says the fomc. they also say they've been close

to that, you can add that the tapering process seems to be going full steam ahead, according to the fomc. to me, that clearly indicates that not only is the federal reserve not understanding what's really going on in the world, but in the short-term, i think gold will sell off from this level. so it's partly technical. it's certainly driven by fundamentals, real rates going up, and now finally yesterday we saw a little bit to my surprise, tapering is not even being questioned among the majority of the fomc members. >> steven, if you want to have a safety cushion for your investment, do you invest into cash? what are the other safe havens out there? >> i think cash is underestimated. because sometimes the best and the best return you're going to have is just doing nothing. we are too predicated on trying to have active management at all times. but coming up a year where most people saw 25%, 30%, i don't think it costs you that much for being cash for two to three, five months, see what the summer brings in terms of economic development. see whether this rebalancing i talked about earlier

we're waiting for fomc meeting minutes from ben bernanke's last meeting that comes out at 2:00 p.m. wednesday. looking at commodities right now, oil is trading up .62%. gold was trading at .79%. nice green arrows there. in europe look at markets. ftse was up but the cac and dax were actually down and hang seng was actually up 1%. so good news over in asia. adam, back to you. adam: jo, thank you very very m. let's talk about volkswagen and the employees who reject addition to organize at the german automakers plant in chatting into tennessee. that will have major impact on labor unions and their future. rich edson is live in chattanooga to bring us up to speed. rich, i can imagine some are calling this a big victory and others are calling it an important loss. >> absolute live of the fight will continue here, adam. the reason antiunion groups are claiming such victory on this was really the best opportunity for the uaw to organize workers here in the southeast for foreign auto plants. when you look at what the uaw had available to it, almost a partnership with volkswagen of the compa

it appears that the fomc is going to be continuing that. it appears i will be reading the tea leaves with the chair woman today. it is tied up with a bow today. the next powerball winner will be one, two, three, four, five, six. as we are moving forward. i wonder if anyone is going to comment on that. i want to get something on the impact of low and moderate income. >> so that is their strategy and it is good to have a strategy. you saw what happened on may and june. you could quarrel whether that is too specific. i congratulate them with moving ahead with some kind of strategy. >> but you would rather have a strategy laid out like that? >> yes, much better. you have seen the market's better reaction than last june. >> let me also echo that. i would prefer to see tapering at a faster rate. i think it is an appropriate direction. with extra caps that portfolio very slowly gives the market things to tolerate. >> the market seems surprised. and then in january. when the next crunch came not that surprised. >> certainly people have been trying

>> well i think she delivered just the same message that the fed has been doing, after previous fomc meetings. so it was very reassuring to the market and to others there is no bankrupt change and she made it clear she intends to continue the process that she's been a part of as vice chairman. melissa: professor feldstein, you heard michelle say that she's concerned down the line that there are problems coming. maybe five years from now we see negative fallout from all of this easy money. do you share that fear? what do you think that, that could be? >> yes i very much do. that's why i have been calling for the tapering to the end of the bond buying. i'm glad to see they're on track to keep doing that because i think it's, not only is it potential for puffing up certain asset prices, equity markets, rose 30% last year because of the interest rate was very, very low. surprisingly when the interest rate started back up, at least until january, we didn't see any negative reaction in the equity markets. it is more than that. there are land prices. there are investment in emerging market

. >> my colleagues on the fomc and i anticipate that economic activity and employment will expand atyear and next. the unemployment rate will continue to decline toward its longer run sustainable level. let me emphasize that i expect a great deal of continuity in the fmoc approach to monetary policy. >> co-anchor of cnbc's "power lunch". sue, it seems like the street thoroughly enjoyed what janet yellen had to say. >> it's a big sigh of relief because this was her first testimony as the new chairperson and wall street thought that they knew that she was aligned with ben bernanke, but once they heard her testimony and her reand you are shns rass that the fed will stay the course in cutting back on its stimulus because the economy is getting better, they were very relieved that basically they have another what they call dove on the fed which means that they will keep monetary policy steady and slightly lower and looser than what is called a hawk, which would be someone who would favor higher interest rates or tighter monetary policy. so as a result, we have a triple digit gain in the d

. >> i expect a great deal of continuity in the fomc's approach to monitoring policy. i served on the committee as we formulated our current policy strategy. and i strongly support that strategy. >> wall street welcomed yellen's words today. the dow gains 193. the s&p 500 was up 20. the nasdaq finished ahead 43. >>> up next, president obama warns, don't cross him or he'll bring down a ton of bricks. we'll explain. >>> but first, here's what some of our fox affiliates across the country are covering tonight. fox 5 in new york with the fbi launching a reward program there and in other cities to deter people from pointing lasers at aircraft. this is salive look at atlanta, the big story there tonight, preparations for what is being called a catastrophic winter storm in the south. you'll remember what happened there just a couple weeks ago. president obama has already declared an emergency in georgia. and this is a live look at philadelphia from fox 29. they're preparing for more snow and bad weather throughout the entire northeast. that's tonight's live look outside the b

there will be reports at the fomc committee. i wouldn't be surprised if in the march meeting or shortly afterwards the fed does come out with a new set of labor market targets which it thinks is more in tune with how tight the economy is. we just can't look at the unemployment report. you know, now when we have the obamacare estimates coming out, we have the cancellation of extended unemployment insurance, those are wreaking havoc with some of those figures. the fed is moving away, it is searching for a new labor market indicator. hopefully, we'll get it in a few weeks. liz: professor jeremy siegel of the wharton school of business and peter barnes, thank you so much. all day long peter's been giving us his assessment of what has been a very bullish sign for the markets. both janet yellen as you heard professor siegel say from wharton, don't count out that there may be a debt deal in washington. both of hose things are creating a very -- those things are creating a nice, fertile atmosphere for stocks right now. and the closing b

set as new excise tax on large financial firms that the federal fomc, not the fsoc, cues excuse me, gettingfied as systematically important. 3.5% tax on any value above $500 billion. profits on u.s. innov whether manufactured hire or abroad. that is to prevent comppnies shifting intellectual property overseas to avoid u.s. tax sakes. reduces carried interest. that is what investment managers use, get taxed at capital gains rate as opposed to income tax rates. camp says when you lower the rates and generate -- eliminate deductions you generate economic growth. >> we'll see nearly 2 million new jobs created. there will be up to a $700 billion in additional federal revenues that they can use to lower taxes even further or reduce the debt. >> as for the chances of passage, first house speaker john boehner while embracing the idea of tax reform refused to endorse what camp is doing here. top republican in the senate says there is no chance that tax reform is happening this year in congress. so camp coming out. he did work with the senate finance committee chairman max baucus. the president appoi

the fomc statement is now six paragraphs long for investors to digest.hings to think about. multiple caveats about if inflation is this or if unemployment is this it is too much. we need investors to focus on what thee do best, which is putting capital at risk where they see returns. david: todd, go ahead. >> let's not fool ourselves. the market, the equity market, the bond market, they like money from the fed. now maybe they shouldn't. maybe in the long run it is not a good thing. what i can't understand, david. is why so many economists and pundits were convinced the economy was strong at this moment. the economy has not been strong. christmas sales were awful. you know, there are three things over the course of the last year the american consumer has been willing to buy. number one, automobiles. number two, homes. number three, greek yogurt. and the problem was, don't laugh, you go to my house. got three daughters and my wife, you open up the subzero and chibani rolls out on the floor. the problem, automobiles an homes are pillars that supported econo

from today is how much janet yellen owned the words of the policy that were used by bernanke in the fomc and how much she was involved in creating them. either that or she deserves an oscar for the acting she did. i think when the market heard her speak, they heard her speak words she was familiar with. if we're looking for a reason for the rally, we lost whatever residual risk was out there about this transition from bernanke to yellen. >> the market's reassured. if we did this with bernanke, there were times bernanke's voice got so shaky, it almost -- >> it changed. >> there were times it felt he was going to break down and cry. i don't mean that as an insult. there are times he got very sort of agitated and shaky and you're thinking -- >> you didn't see that. her cadence was pretty much consistent. >> she was boom. >> if there was any question, she knows this stuff. she knows this stuff. maybe you disagree with her points of view which a lot of people do. >> got to leave it there. >>> on deck, a total dude segment. why steel must and slim jims are driving today's market. >>> plus, we

you know, the fomc in the minutes that they just released this week, they were also cautious on housingr. they think there might be some fundamental problems. people talk about all kinds of issues when it comes to housing, will first-time home buyers come back to the table, will rising rates hurt buyers in the marketplace? will people opt to get into apartments and rentals instead of full-time housing? seems like there's a lot of headwinds, but you remain bullish. you say this can propel broader economic growth to higher levels. tell us about that. >> yes. i was going to say all of those things that you just listed are things which can affect kind of the contour of how housing recovers, but none of those things are of sufficient magnitude in terms of headwinds to stop the housing recovery. they'll just change exactly when it occurs, how much it occurs and in what shape it occurs, whether it's single-family housing, multi-family, owner-occupied or rental. but the fundamentals are the housing stock is aging more rapidly than it has -- gerri: we need more houses -- >> -- since the early 19

unemployment is well above where the fomc wants it to be for the mandate.ull recovery is far from complete and it's almost a re-tapping of the board in terms of where we are with these rates at least as long as this remains above 6.5%. meeting, below six and a half percent. talking about the long-term who wantd, the workers more work. >> market reaction in a word? --tch janet also basically >> janet basically said -- >> she won him over with a smile. yellen's comments boosting confidence. john dawson dawson is in hong kong with the details. >> continuity was the main buzzword today. also reassurance and relief. four and a half hours and convincing them that there will be no change from the burning key moves. that's a relief. the u.s. and latin american markets, nothing dramatic. best two day game ends five months. the nikkei said today and again. the rest are pretty flat. half a percent gain so nothing dramatic. thus performers of the day down to the chinese trade. reassurance and then wonderf ul word, continuity. it's a great word. >> imports and exports b

the minutes out from latest fomc meeting show the fed is on track to continue with its gradual tapering if he the near record highs we approached today and the back off as a signal of investors? nothe returns are probably going to be as great as they were, that's for sure will stop but the fundamentals seem relatively good. the economy is growing. when you look at valuations trading at 15 times earnings on the s&p, it's not a big stretch. todon't see any real reason run from the market. we're looking to add his editions will stop >> he's not the only one bullish on stocks. adam johnson took a look at the case for investing inequities. >> the most compelling argument i've heard for being lush all from therought to us strategy at rbc. years and found that incredible correlation. he determined a study one percent move in grossed must it product led to a 2.5% move for sales on the s&p 500 cup these. a sixranslated into percent move for stocks. that's why the big picture matters and that's what you call operating leverage. if economists are right and gpx or aides later this year, estimates a

we had a whole line of fomc officials say, it is an outlier.d to for them to take account for this? a couple of things i have been looking at, there is a big buzz about this, it is not just the weather. the u.s. retail sales, we saw internet sales down. that is people sitting at home shopping on the computer. less people doing that. is that really the cold? if you look at the confidence data as well, big declines across all regions. the biggest plunge was in the west. i am not qualified to say that it is not the weather but i am here to ask the question, is it just the weather? is it something else? recovery on what is the federal reserve think about it? >> u.s. data missing estimates by the most in three months. john, give me a number. how many times -- i'm going to say four. how many times in the fed minutes will they mention the words "emerging markets?" i will say four. >> it could give couplet hit it. >> what are we talking about here? >> four is a good number. >> what happens if they talk about china, brazil, turkey? >> it has to be those