two years ago when fomc began this purchase program, the unemployment rate stood at 8.1%.rogress in lowering it was expected to be much lower than desired -- slower than desired without additional accommodation. the intent of the program was to achieve a substantial improvement in the outlook of the labor market and to ensure inflation was moving back toward the committee's longer run goal of 2%. in light of the cumulative ingress toward that maximum the labor market since the beginning of the program, and progress the minutes somewhat, we have reduced our purchases again at the -- at this meeting. starting next month, we will be per month,16 billion down 10 billion per month from the current rate. this supports the committee's expectation of ongoing improvement in the labor market and inflation moving back over time to its 2% longer run objective. the committee will end this program at our next meeting if it stays on schedule. the committee will continue investing proceeds for maturing securities and principal holdings for debt and nds. the committee's sizable holdings of

first, was it debated at the fomc as whether or not it should be included?nd i'm sorry we've been over this before, what does it meantime wise? i have just a couple more here. finally, how do you square this idea of a date when you and others on the fomc have continuously said that you're data dependent to the point where if the data were to turn, would it not necessarily be a considerable time until you raise rates? thank you. >> so, of course, the committee discussed its forward guidance today, and it discusses what the appropriate forward guidance is at every meeting. this is part of our assessment of economic conditions and the appropriate stance of monetary policy. i -- in terms of what the term considerable time means, the committee decided that based on its assessment of economic conditions that characterization remains appropriate, and it was comfortable with it. i think if you look, for example, at the projections of individual participants that are revealed in the sep, well, that's the view of each participant and, again, i'd emphasize not a commit

was it debated at the fomc? what does it mean timewise? is the statement of forward guidance and how do you square this idea of a date when you and others have continuously said you're data dependent to the point where if the data were to turn would it not necessarily be a considerable time until you raised rates? thank you. >> so, of course, the committee discussed its forward guidance today and it discusses what the appropriate forward guidance is at every meeting. this is part of our assessment of economic conditions and the appropriate stance of monetary policy. in terms of what the term considerable time means the committee decided that based on its assessment of economic conditions, that characterization remains appropriate and it was comfortable with it. i think if you look, for example, at the projections of individual participants that are revealed in the sep, the view of each participant, again, i'd emphasize not a committee collective view, there's relatively little change in the assessment of the outlook by participants between

fomc isebated at the whether it should be included ?as was indicated in our policy ? what does it mean time wise? statement of forward guidance in how to square the idea of the date when you and others on the fomc have continuously said you are data dependent to the point where if the data were to turn, would it not necessarily the a considerable time to raise rates? >> of course, the committee discussed his forward guidance today and it discusses what the appropriate forward guidance is at every meeting. this is part of our assessment of economic conditions and the appropriate stance of monetary policy. in terms of what the term "considerable time" means, the committee decided that based on the assessment of economic conditions, that characterization remains appropriate and it was comfortable with this. example, at the projections of individual ,articipants that are revealed it's the view of each participant and i would emphasize it's not a committee collective view. there is relatively little change in the assessment of the outlook i participants between this meetin

you really know people are going to be nervous ahead of the fomc meeting.y cautious at this point knowing when we get that change in direction in terms of guidance for interest rates, it's going to have a big impact on the market. we don't think that may come in and out. but you can feel that nervousness in the market. >> why maply tech movers yesterday, then, if it was spurreded by the fomc meeting yesterday? >> probably not so clear why it might be tech. in general, we like sectors like tech. if you look, especially in the u.s., where sector valuations there, it's more the high yielding sectors, utahs, parts of financials that have been stressed as we transition to higher .rates we think those are the sectors likely to operate and seshths like tech will probably do better. >> but in the long-term, do you see tech outperforming? if you look at history, tech tends to outperform. >> exactly. we think it's still a good environment for cyclicals. so tech in general within yeah, we think it is good. >> i would think, you know, rates are rising because we are se

melissa: tune in tomorrow, live coverage of the all-important fomc statement with fed chair janet yellen. that is the news conference she will be speaking at tomorrow. you don't want to miss. that it always moves the markets. you can't afford to miss it. we'll be right there. >>> the tiff heard around the country. a football player's 20-cent tip is raking in dough online. >>> dire drought conditions taking a toll on california's economy. will the rain and relief ever come? do you ever have too much money? ♪ you're driving along, having a perfectly nice day, when out of nowhere a pick-up truck slams into your brand new car. one second it wasn't there and the next second... boom! you've had your first accident. now you have to make your first claim. so you talk to your insurance company and... boom! you're blindsided for a second time. they won't give you enough money to replace your brand new car. don't those people know you're already shaken up? liberty mutual's new car replacement will pay for the entire value of your car plus depreciation. call and for drivers with accident forgiveness

there until the fomc.t happened this morning, someone was selling the vix september 18 x, an etfting the vx that loosely tracks vix, and b uying the 88 strike calls. >> why? >> vix options expire wednesday morning. selling those options that do not capture the fomc. in strike,re equal he is buying those and not paying any money. it is an interesting way to capture the fomc spike. >> which tends to happen. more volatility around those announcements. another stock that has been volatile is ebal. -- is ebay. that is because of the announcement of apple pay. investors questioning what is this going to meet for a company like ebay, which owns paypal. how is the options market reacting? >> a lot of positive sentiment giving the stocks selling off a lot on ebay and paypal potentially getting devastated from ebay. the stock rallied and at that point we saw last week people buying puts in ebay. puts that expire this week. >> they were anticipating. >> today, we saw with the stock down as much as it is, people buyin

this week's fomc, the dollar is bidding against the euro and the yen, equities come back. bond yields are rising, everything is set you will for fed action or inaction that will lead to greater things down the road. the market may think the market is going to tighten. at least in the middle of the year if at all. >> the middle of 2015. a long time frame for you. gentlemen, appreciate your time. the dow sitting at 17,076. higher by 62 points now back to liz for more of our exclusive look at greylock partners, liz. liz: what's fascinating, cheryl, they have thousands of people try and get in the doors every single year. only 20 officially get a pitch meeting and fewer than half will end up getting greylock money. what is the secret that you have to have when you are pitching that? by the way, over the years of the hundreds, i don't want to say thousands, they are very selective. of the hundreds of companies they have given money to, 150 have launched ipos. that doesn't include the ones that have eventually been acquired. the guys have a way of spotting the winners. in the ne

i'm sure you read the fomc meeting minutes. what do you take away from the report? >> the fed is being very cautious here. they did not change the considerable time, their commitment not to raise rates after concluding the asset purchases. they are getting ready to change their stance over time. janet yellen was saying over and over again, this is all that data dependency. we have not changed anything. we are getting more ready to change our stance later on. >> we are not changing right now, but we are getting ready to change. what does this do to the job of people like you? >> it's a wonderful proof statement of the value of a liberal arts education. we are talking about monetary policy. we are parsing sentences and talking about word choices. i think this fed considers communication to be as potent a policy tool as interest rate policy. there is no change in the pace or the path of fed policy today. if anything, the fed is try to recalibrate market expectations a little bit. the 2017 dot chart helped -- >> explain that. pointillism and 2017. 2017 seems like a long

there's room for more volatility especially next week with the fomc.as you said, carolin and wilfred if there is more hawkish words in that statement. >>> cnbc has learned the fed could make an important change to its policy statement at its meeting next week. the change being debated is whether to drop the term considerable period after asset buying ends, ud isly indicating a hike in the next few months. considerable time has generally been interpreted to mean at least six months. log on to cnbc.com to read the full story ahead of next week's fomc meeting. >>> now, carter worth joins us now. it seems like the only way is up for the u.s. dollar. has it got further to go? sglts quite incredible. if there is a concept of latent potential and then the follow-up concept of exploitation of potential, the ricochet, the huge move in the dollar, it's quite exploitative. it's going to be fallow. so after a powerful three, four-month move like this, the presumption is that you have a backing and filling, a normal consolidation after a powerful move like that. yo

>> right, next tuesday, we've got the fomc meeting, we have cpi and ppi, the market is telling you it's anticipating the fed is going to start raising rates. that's what we have to look at. other than that, the stock market still today is lower, but within 1.5% of record highs. you know people are anticipating when is this going to turn? they're trying to get in front of it? tuesday's meeting, we've been waiting for something to move the market, tuesday might create a catalyst. liz: well, the announcement comes wednesday. the tuesday meeting. >> right. liz: the excitement happens in the 2:00 p.m. eastern hour on fox business, but janet yellen will, of course face the press and the media just around that time and spills over into this show wednesday. mark it down on the google calendar, darlings. jeff grossman, looking at the numbers in oil and natural gas and gasoline, rbob moving lower, no inflation at all. >> certainly not from the energy sector. i don't talk about food and drugs and things like that, leave that to everyone else. let's put it this way, what we've had in the last coupl

elsewhere, we are seeing some reasonable gains just ahead of the fomc. so the market, once again, is positioning itself for a dovish outcome at the fed this week. are we going to see that? well, it's anyone's guess, isn't it? carolin, wilfred, back to you now. >>> now, the 19th may be dead and gone, but you can still have a coffee at central perk. details after the break. how much money do you have in your pocket right now? i have $40, $21. could something that small make an impact on something as big as your retirement? i don't think so. well if you start putting that towards your retirement every week and let it grow over time, for twenty to thirty years, that retirement challenge might not seem so big after all. ♪ >>> welcome back to the show. i want to bring you comments from the ceo of sony. they broke down the entire amount of google in that segment. it says we're now revising our strategy. this is according to the ceo. he says we'll now focus on achieving stable profits in the mobile division. and they're cutting 15% of staff in that fiscal year t

happens, remember, if you take a look at the fed fund's futures market they are below the rates that the fomc members believe are going to prevail at the end of 2015 and 16. >> markets are to some extent already planning on earlier appointments with higher rates, the cnbc fed survey showed the 37 economists strategists fund managers, seeing the first rate hike coming in june of 2015. the second survey in a row that they brought nearer for the date, the first hike. they see the fed hitting the higher rates in 2016 than the prior survey. whatever the outcome it seems the market has new faith in the new fed chairman janet yellin. 30% think they can execute the monetary policies smoothly, up 10% from the last poll, just 7% believe it will end badly with the stock market. half the surveys. and the fed chair gets higher marks for being clear, even better marks then her predecessor. will it last? yellin has a tough month to go, and she will need every bit of market faith she can gain to be successful. for "nightly business report," i'm steve liesman. >>> he is an economist at the center for policy p

. >>> on tuesday, the fomc kicks offer the two day meeting on monetary policy. >>> on tuesday, alley back bah prices shares for what could be the largest public offer ago ever. >>> on wednesday we get the consumer price index for august. >>> thursday, housing index figures. also thursday, scotland will hold a vote on whether to separate from the united kingdom. >>> on friday iphone 6 hits stores. >>> should i stay or go in it's a question many are thinking about. choosing to retire in place or move to a new location could make or break your nest egg sharon is here for up temperatures on what to do. she's got tips on the best cities. >> thanks for having me. >> it's a huge question. baby boomers are fact this. big and small expenses. what do you need to break down before you decide to move or not? >> simple things like moving expenses. that could be like $10,000 depending on where and how far you're moving, how much of packing you do yourself. that's something to consider. also the price to sell is. what do you need to do to fix up your home to get it ready to sell. you love this home

they were gravitating towards the more dovish elements in the fomc yesterday. see the dollar, though, power ahead once again. the six-year high for that cross and that helps to really power the export sector in the broader nikkei lead to go that. the gain at the settlement of more than 1%. however, there was one notable drag and that, of course, was sony. shares were down by 10% at one point during the session after they warned off a 2.15 billion dollar loss in the year march 31st. essentially, the s&p putting sony's ratings on the credit watch negative. elsewhere, china markets, a little bit of weakness there. property developers, but all in all, it's a pro risk day today, everyone. back to you in london. >> thank you very much, sri. >> it's steady as you go for the fed. rates will continue to stay near historic lows well after its ends its bond buying program next no. the fed capped the phrase for considerable time in its post meeting statement. janet yellen noting the economic forecast hasn't changed much since their last forecast in june. >> i want to empha

they squawk, but not amplified by having a vote on the the fomc, and that's really important. >> stevew, carl -- >> go ahead. go ahead, steve. >> the one thing i think is the fed is very comfortable fighting inflation and uncomfortable fighting deflation. i think that tends to let them continue the existing policy. they are not worried. if they see inflation, they are comfortable. they know how to fight that, but fighting deflation's a very different thing, and i don't think they want to move early or the hawks win the argument. i think rates stay lower for longer than anyone thinks. >> in terms of stocks, i want to get this in quickly. telecom and utilities out perform in terms of s&p groups, is that the strategy in the low rates world? >> well, you know, actually, high ying ecstasy income securities are weak, they continue to be weak today, and telecom and utilities are not the yielders. look at bdcs, where they go for 8, 9, 10 % yes, stocks have been weak. under the impression they are going higher, it's a misconstrued fear and stocks will be bought. i look to buy higher yielding eq

but she really did hold onto her views and separated her views from the rest of the fomc. she didn't say too much about them but i think it's very clear who holds the gavel in that room. chair yellen holds the gavel. this is really a very important issue. when we're splitting hairs talking about which month the fed may raise rates, we're all pretty sure the fed next year we hope will get to that point of raising rates. if they do it sooner, all the better. >> steve, one second. let me get to jim bianco here on the actionable side of this. i'm curious what you think the message to investors should be? is this a, it's time to position for higher rates even though they're not till next year? or should people look at the cyclical parts of the market? >> i think the market has been rallying the last couple of days, expecting considerable time it was going to stay. it did. it saw this meeting as being more dovish. the fed is going to continue to stimulate. it's going to continue to stay positive for risk assets. and i think that's going to be the case right now. stocks are going

that might have been slightly overblown, but we have seen, we saw monday prior to the fomc and thegotday piece in the "wall street i -- journal" on tuesday, some internet type names have really underperformed. >> what does that tell you? >> we think a lot of people who will have to buy into alibaba, a can't-miss trade in people's minds, they had to clear the decks. >> firms which is t. rowe price, as fidelity,s well examples, these are companies, financial brokerages and banks that said they want at least $1 billion worth fo -- of alibaba stock. le we have heard people, peop with $1 billion books wanting $300 million worth. >> someone on the telephone said that? >> not on the telephone, but we have gotten that. i don't know if that is true across the entire book. we're not involved in the process, but there is a lot of demand. >> the book building process, you said the process involved six large financial institutions, taking a variety of coordination. describe what you believe could happen tomorrow at 9:30 a.m. when the market opens? >> it will be right when the market opens. the new

. >> day one of the fomc meeting. >> futures nowhere. nymex crude gets my attention. vix, showing some of the sogginess. continued weaker ruble -dollar. canada weaker. this is a log charg. only in september. of johns hopkins university would get this. see the gentle curve? >> that is not gentle at all. in a currencyove against log axis. >> you are scaling it to show percentages. so you see reality rather than emotion. just 4% and change. it still has a radical curve up. toi will not compare zimbabwe. getting the elements of currency depreciation. >> what was it? 15 years ago, five rubles to the dollar, now 38. >> you have your morning must read involving nato. the front pages are fascinating. we did not even know where to begin. up where you left off, according to the oecd, world economies face a triple shock. cutting growth forecasts for the biggest developed economies. the reasons why are what you just showed us, increased risks in ukraine, the middle east, and the scottish vote. the backdrop is subdued european inflation. is theres interesting is no front page on a

that means lots of binders and presentations by the expert to come with all of the members of the fomcanet yellen is famously over meetings.or these she was such a great economics student and she was at yale that evil saved her study notes and pass them on to student to student. >> did you ever get any of janet yellen notes? >> i did not. >> you know people like that. you went to school to earn your degree. tell us about the mindset of someone like that. famous for over preparing myself, so in a way, i can relate. but in talking about the meeting tomorrow, clearly, there is a lot of preparation that goes into it. the action we should be seeing is some sort of change in forward guidance. my take is that it had been date dependent thus far. i think we will see a shift to data dependent. we know that qe already was data dependent, but it was -- it is now about reconsidering the considerable amount of time, while the fed still keeps rates low after the qe ends. exclamationo get an tomorrow -- explanation tomorrow in the press conference. >> what do you expect them to say? i don't mean to a

monetaryse of the fomc policy statement -- this set is expected to reduce monthly bond purchases by anotherion , down to $15 billion. according to economist surveyed by bloomberg, janet yellen will follow the release with the news conference. on thursday, foreign affairs will be the theme. hold a referendum on independence from the u.k. the latest polls show a tight battle there. ndc, president obama will host ukrainian president poroshenko at the white house. it also marks the alibaba ipo day. china's largest e-commerce company has received enough investor interest that it plans to stop taking orders for the sale early. for u.s. investors, that means 4:00 p.m. on tuesday. alibaba has a fundraising goal of $21.1 billion and will begin trading on friday on the new york stock exchange. also in stock news, it will include earnings from adobe, fedex, general mills, and oracle. that is you look at what is happening next week. >> thank you so much. have a good weekend. another check of the market is on the other side of this break. ♪ >> get the latest headlines at the top of the hour on bloomberg

so we're still very much in a strong dollar environment as we head towards the fomc. back to you now. >> sri, thank you very much. as sri just mentioned, chinese consumer inflation fell to 2%, weaker than indicated. neutral monetary policy starts were blamed for the decline. eunice at the world economic forum is joining us. >> hey, wilfred. just talking more about those consumer price numbers, what we're seeing is quite a bit of slack in the housing market. and that's filtering in to consumer prices. there's, there's a lot of discussion about how excess capacity is weighing on industry here and that filtered through to producer prices. now, all of that is just more evidence to the weakness in the chinese economy and one of the reasons why we've been hearing a lot today about how chinese -- the chinese slowdown poses a risk to the global economy. now, we also heard from the chinese premier who spent some time at the world economic forum here to really try and reassure some of the business leaders at this high profile event. he was talking about how the economy is doing

there's a big sense on what the fomc members are projecting for the rate. i think that goes to the fed is focused a lot on the labor market. they've pointed everybody to the labor market. and the labor market to me has been unambiguously strong. we have 1% growth in the first half of the year. and the unemployment rate fell three quarters of a percent. so jobless claims are down. just about everything is strong. and that suggests to me that tightening is probably going to come in june or maybe sooner and the market's pricing somewhat later. you're right, becky. there probably will be some reckoning. i don't think it's going to be like the taper tantrum. yields aren't as crazy low as they were before. but i think there will be some adjustment. but remember, if the fed's tightening because the economy's strong, that's not usually bad for the stock markets. if it's because inflation's high, that's real bad. >> i know that we all seem to think and janet yellen has been honest about this. she's also been adamant about when she does start raising rates, it won't

. >> i just don't see how you can really interpret that fomc meeting or any yellen fomc meeting as hawkishis is the fifth meeting where she repeated in the statement verbatim a very long, complex statement. it's 38 words long, nobody focused on it. everybody focuses on just the considerable time thing. but these 38 words are the key. these 38 words say that even years in the future, when the economy is completely back to more than normal, maximum employment, stable prices, that policy will still be looser than normal. she's promising that this easy fed will be easy forever. all you have to be able to do is read 38 words. it's like the great poet, maya angelou said when people tell you who they are, believe them. >> understood. yellen, the dove. i get that. as stocks move higher, value agdz is going to become a concern. we've seen that in the tech sector. that's one of the reasons the so-called momentum stocks have been under pressure over the past couple of months. what are your thoughts there on valuation? >> well, i agree. i'm delighted to see the alibaba ipo and it's a great success for

that's why we've got some fomc members saying that really the market is behind the curve.ually think the fed is behind the curve. but maybe this time the market is a little behind the curve over here. so i do think there's some room for some volatility in the market over the next week when they realize that, yeah, this period of zero rates is going to end. but if you take a look at the big picture, rates are still so extraordinarily low that money i think will continue to flow into equities. >> professor, i'm hoping you can weigh in and maybe larry as well this morning. i argued this is the most important story of the morning. which is calipers announcing they're going to get out of hedge funds. they're going to take $4 billion out. and the question is whether this is the beginning of a trend. whether we'll see other public pension funds or even private funds take money out of hedge funds and what it all means and whether it's the right decision. >> well, the hedge funds have lagged considerably. they've generally been way to bearish on the stock market. the stock market h

there is a series of events last week that should be interpreted as good news from the fomc to baba to the iphone to scotland no vote and calpers walks away from hedge funds at probably the most important time to have it. i own puts. i think it is the right move on a trading basis right now and i'll stay with that until i'm taken by a new high. >> historically if joe wants to trade for the next month or six week i see reason the buy. we're looking just a couple points below the s&p. did it mark a top for the market two days ago? absolutely not. alibaba is not a top for the market. could we correct? gentlemen. but look at the action. look at go pro today. they are having a great day at all time high. facebook. trading off its all time high. i think there is more in the market. >> two-thirds of the people that we've asked to vote as we are having this conversation is no they have not marked the top. and people have been trying to call the top for some time looking for whatever they can find. i can suggest okay, earnings are still growing the economy is improving and the fed is still in t

evans's comments, he's a voting member on the fomc next year. we are almost through the year of the hawk versus the dove because dallas fed president fisher and placer from switzerland will be leaving. mid-year 2015 interest rates hikes will be slow and steady, and you will have dissenting opinions, doves dissenting with other doves about the pace and the level of the interest rates. that's giving a look to the market. overall, liz, i would say i can make a bull case or a bear case for pulling back some, i don't think we're going to get new highs or 10% correction in the offing any time soon until we get through the middle or late october. liz: i'm surprised you're saying that about new highs, looks and feels like we might. you could be right. everybody stay tuned to chris later on in the show, put aside september, it's novand december, you have to what are he has to say. alan, right in front of me, big tech looks unbelievably healthy. financial services all green, industrials, except for ge pretty much all green and the consumer names, this is

fisher, interest rate increases might go sooner than june of 2015 even though he is not a voter on the fomcar. the dollar is punishing market. hitting three sectors, materials, industrials and energy. >> i heard a lot of news about russia. pertaining to what they may do in retaliation of recent sanctions. you hear anything about that? >> the only thing you hear about russia, they're getting playful shall we say with flight incursions over baltic states. anybody that thought vladmir putin would take up his ball and go home because we slapped sanctions on him they're fooling themselves. that is a story that has legs. we'll keep eye on it. i think things pointed out earlier are buffeting the market. >> we've broken through ski support levels. that is it. we'll toss it back to you guys. down 242 points. melissa: nicole, thank you very much. president obama back at united nations urging a global response to the ebola outbreak that has now killed 2900 people. >> if ever there were a public health emergency deserving an urgent, strong and coordinated international response, this is it. but this is

dollars a year, even with the divergence within the central banks, meaning the ecb compared to the fomc. another thing, we have to look at asset class volatility. not just equities. although that matters. look at foreign currency, energy, et cetera. all of them are trading between 10 to 15 percentile low. that suggests by investors, by people who have money at risk, that all is well with the world right now, no matter what the headlines happen to say. david: by the way, there is historical statistic, ryan, i teased your introduction here by suggesting you might have it, five straight months we've had records on the s&p. that has happened before. explain why that's significant now. >> sure. what i looked at was we have five straight months of gains on the s&p 500. we were down last month. but up five straight months. what's that mean? since 1950 it only happened 22 types. the results after up five months, out three and six months, better than at anytime return. just because you're up a lot that isn't bearish. out of these 22 times, year later after up five straight months the s&p was hig

the fomc sticking to all-important language, rates will stay low for, quote, a considerable time. that was the language and it stays. after bond buying stimulus wraps up. if you watched "countdown" you heard jon hilsenrath get it right. market reaction, stocks initially jumped at 2:00 p.m. eastern when the report was issued by the federal reserve there would be no change. you see the intraday chart and what happened in the markets jumped and fell and stayed pretty high. up 52 points for the dow industrials. it was up 20 points before the decision came out. it shot up to a new intraday record high of 17,221. right now you see 17,182.7. the other major averages behave pretty much the same way. the nasdaq moving up and down and slightly around. you have the russell 2000, everything is green on the screen just to let you know, up about 6 points, the russell better my five. look at the transports, up 106 points. that is a big gain even for the transports at 8,676. looking at the 10-year yield, i find the dollar more interesting. the 10-year yield up 2.61% back where it was a few days a

we've got the fomc meeting, and we'll all be looking at the wording. we expect no changes., will they give us another clue as to the when they're going to cut back on interest rates or start raising them? and then, of course, we've got the scottish independence vote which has a whole new thing going. i didn't realize it, if scotland votes to leave, they leave nato. i had no idea. they're out of the e.u. i had no idea on that. so this is more than just money, this is what's going to happen there. and then, of course, you've got a year and a half to be able to figure out what the bank of england, how they get the money over to scotland should they do it, but that's if they do it. so i think traders are sidelined. this all happens on the 17th and 18th, basically. i think you've got to be very careful going into this. liz: well, i would definitely say and to see the u.k. pound at $1.62 when at the beginning of the summer it was at $1.72, you see a big weakness because of the uncertainty. peter, talking about what comes out of scotland, north sea oil. they control that. is there

you had apple, you had alibaba, you had scotland no vote, t the fomc, basically letting the markets be comfortable and you had bad price action. i think that just tells you something. it it tells you something about what steven is talking about. maybe we are in an environment over the next couple weeks where equities, risk assets are going to gravitate towards a correction. i believe that. i'm positioning for that. six months from now i think they're going to be higher. we could call this nothing more than a trade. i'm focused on the russell, on the nasdaq, they're both breaking down. that's where i own puts. >> you talk about where sentiment was last week and look at today. existing home sales, weak. china data, soft. emerging markets, almost across the board weak. >> you know what's interesting, i was with the ceo of a company on friday morning and he's one of the most important players in the housing business in terms of mortgages, buying and originating them, and he doesn't buy into the fact that we've got more to go into housing. he thinks it's weak with the exception of selective

help a whole lot because right now traders are, basically, very anxious waiting for next wednesday's fomcwith that in mind, any kind of news -- especially something so big as apple -- could really affect the market. so i think you're spot on with apple and the effect to the market right now. cheryl: paul, today's market action in particular within the last half hour, you had a lot of volatility in really the dow and the nasdaq pushing session lows. we somewhat came back. you're looking for a big correction. did something happen today that kind of reinforces your belief that we're going to lose more points? >> well, i don't think two days makes a correction, but i do believe we will see a correction in the next eight weeks, and here's why. i mean, we're value investors at fairfax global markets, and we can't find any value stocks that meet our screen. so there are just no undervalued stocks in this market. the second thing is september and october have historically been the worst months for performance in the history of the stock market. and lastly, earnings drive markets. and we have to t

one thing we do worry about is the fomc has to transition, the u.s. market towards rate hikes. we think that meeting on september 17th could be that meeting in which they do that, which could create volatility. >> bob, would you agree with that? >> well, we certainly agree that the ecb did the right thing. we thought they needed to do something material and they did. and the markets are reacting accordingly. we're probably in a different camp with regard to the fed. we don't think they need a pivot relative to what's pricing the forward curve if anything we think they'll take their time and they're not going to put the recovery at risk by moving earlier than they need to. that's one of the reasons why we've remained overweight risk assets. we think not only the ecb but the fed will remain accommodative for some period of time by any historical standard. >> talk to me about those risk assets. you like high yield. but where in high yield? and what other areas would you be putting new money to work in given the environment that you just laid out? >> well, overall we like credit an

we have apple -- fomc meeting. on friday and a bunch of housing market data so the a lot of information for the market to digesting. that plus scottish independence and more rumblings out of catalonia. just a preview of that. people squaring, getting ready for later on in the week. not much today. i things will rev up tomorrow and friday. you see that in volatility numbers hitting higher notes as we yap up here. david: lincoln ellis, brilliant strategist. thank you very much. appreciate it. liz: raise your prices, lincoln. david gave awe commercial. david: he's good. he's good. liz: the u.s. dollar fell from its 14-month highs from its peers but the currency has been climbing for nine weeks. that is the longest rally in 17 years. david: but the strong dollar may actually hurt some companies this coming earnings season. so which companies will feel the pinch, which will benefit and how will the scottish independence vote impact the pound sterling? joining us ceo wolfgang coaster. wolfgang, good to see you. let me ta

release ofere is the the fomc monetary policy statement.pected to reduce monthly bond purchases by another $10 billion, down to the team billion dollars, according to economists surveyed by bloomberg -- down to $15 billion, according to economists surveyed by bloomberg. thursday also marks the alibaba ipo day, but according to people with knowledge of the matter, they have received another investor interest that they planned to stop taking orders for the sale early. alibaba has a fundraising goal and will begin trading on friday ,n the new york stock exchange and we also have earnings this week from adobe, fedex, general mills, and oracle, and we will have all of that for you on bloomberg television. back to you. >> that was yang yang right there, taking a look at the key events in the u.s. this week. ipo takes place soon, and they roll into hong kong. before the roadshow is even finished. any chance that maybe the valuations could go up? >> market is so high. they are looking at where the investor demand is coming from. mutual funds, for e

fomc.'s get back to the it will not raise interest rates anytime soon. fed's monetary policy. the pace will be pretty quick when they do get going. weseems what we could -- could have five rate rises in 2015? >> it has been lifted by 25 basis points. 2015.e eight meetings in if we raise it only five aces points. the market is scratching its head. that does not feel to me like a considerable time. slightly frustratingly confusing. ridiculous. look at the dispersion of those dots. one near zero and one near 3%. i do not know which official is which. do you put much weight on them? >> the fed did in its report two ands ago and went into debt why they market is not believing the dots and it is much more dovish than the median of those suggests. janet yellen has been clear and they have been given prominence. i think they're trying to make .he market anchor >> she is keeping the considerable time frame and whatever that might be saying that the labor market is that where she wants it so everyone knows it is not imminent. the market does not terrifyingly sell

it is telling the same story, the people are somewhat complacent going into this fomc. >> perhaps youey on individual names. you have a trade for us, specifically on costco. >> i like roscoe a lot. let's talk about the [indiscernible] right away. i'm going for the january 1 28 call spread -- 128 call spread. [indiscernible] a lot of things going for costco. the stock is showing nice technical patterns. also, you have most stores that they are opening, they are seeing bigger traffic. each sales order is higher. they are at a higher income group. you for joining us. we will be on the markets again in 30. ♪ . . welcome to "money clip" where we tie together the best stories, videos and interviews. i'm adam johnson. scotland gets to cast the vote that will have huge indications for the british parliament and scotland's most prized export. can you guess what that is question mark we got our hands on apple's newest iphones in the reviews are -- we will tell you. spacex to drive to infinity and beyond. in media, the roosevelts -- ken burns has tackled

taking a look at their books and setting up for the next big event, which is september 15 when the fomcoming out on friday as well. >> we have had multiple instances of those without much action in the markets. you see there is some activity that is concentrated in individual sect or's. sectors. -- other thans that, at a macro level we are not seeing much positioning, even with pfizer trading off of the highs. individuallk about stocks. as i'm looking at the most active option, intel is up near the top of the list and it is trading near a 10-year high. what are we seeing here as it gets up to those types of levels? >> we are seeing activity in the calls, september expiration, 36 strike calls appear to be sold around 70,000 times. it appears to me when the stock had the momentum on the way up around a month and a half ago, a lot of investors bought those calls. sustained rally. instead, the stock sort of settled down at this current level. what they are doing is cutting their losses and getting rid of those options, those call options they bought earlier. we are seeing a lot of closing s

vote next week, and that is the black swan event, if it does arrive -- incidentally, that will happen fomcef the announcement next week. looking at potential volatility on both sides of the atlantic. if we were to get a yes or, looking at once a political uncertainty as edinburgh and london get locked into a lengthy political negotiations, separating the nation's assets, liabilities, showing the bank of england, and the regulator for scottish banks. that will have an impact on business confidence in an impact on the cost of doing business in and out of scotland. it will certainly impact the probability of u.k. saying within the eu during the next parliament. >> one of the things i think about is we are single world now as it becomes more digital, global economy that the nationstate boundaries just aren't as significant as they used to be. it is and just what is going on in scotland and you take, which is cute -- huge, but look at other parts of the world. the influence of other entities. it could be large global corporations, protest groups. the twoas much power as governments in those coun

it will depend on whether you look at the dots coming from the individual fomc members of the fed, whether listen to the words that janet yellen said. with your take on the strength of the economy at the moment -- wha'tt's your take? >> we are getting the third testament of the second quarter gdp. we expect them to be at 5% which would be a positive upside revision compared to 4.2 or sent in the second release. -- 4.2%. they rebounded after the very weak number we got in the first quarter and q3 looks to be would be% but that very good back-to-back growth in the u.s. >> i saw jobless claims on yesterday continuing to point to strengthen the underlying market . do we think the august nonfarm payroll number that was so week was just a one-off? do we still see underlying strength in u.s. labor? claimsial jobless numbers are very positive. they are back to numbers we use get before the financial crisis which means there are not that many layoffs now in the market. on the flip side, we had a week nonfarm payroll but it followed a stretch of very strong numbers. it's not something i would be con

risethe fomc put a rate coming in with the dots under 4% in the long-term.u will get that in the u.k. given the amount of debt that we have in the household sector. i don't think the market is badly mispricing. i just think now that we have got this behind us, the debate will shift from being all about the timing of the first hike here to the timing of the first hike in the u.s., and then about how high rates will eventually go. i think both of those are over the medium-term, negative to certain. >> what is the better trade? do i take the dollar trade to sterling or look at europe? where am i going to get the biggest eye and for my buck or pound? >> they are all slightly different in terms of where they are. the market is very bearish on the euro. the position looks very short in the euro. they are not liking the euro. the in short it is a familiar position. we have no kind of a short covering rally in the last couple weeks in euro. torling is back up from 1.60 1.65. euro-dollar went back up. the positions are quite stretched. the ltro was disappointing. >>

in the asian markets as we round off this week and look ahead to the major risk event that is the fomc. so we're still very much in the strong dollar environment. yes, the weaker yen is benefiting the nikkei. made to run of 16,000. didn't quite get there. pretty tough hurdle to cross on the market. elsewhere, a focus on the democraticer china market. as we head into the weekend, we have a major risk event in the form of data breaking on saturday which includes fixed asset investments, industrial production and retail sales for the month of august. the shanghai composite, oddly enough, you would have thought that there was a lot of caution in the greater china markets. but shanghai is one of the top performers today. hang seng, though, lagging by about three technical%. we get closer to the data deluge over the weekend. perhaps the shanghai market is running the prospects of more calibrated stimulus. remember, wilfred, inflation data. the consumer level and the factory was relatively subdued. that's where we stand right now as we round off the week. back to you now, sir. >> many thanks

the next fomc meeting is on september 16th and 17th. >>> home builders hovnanian and el pollo loco. >> what do you make of the market levels right now? the s&p is about 15, 16, it's not too expensive, is it? >> not too expensive on a whole. we're looking at different sectors within the s&p. i think if you look at consumer staples and utilities, they are the classic dividend substitution. investors who can't buy bonds. i think those are fairley overvalued. but if you look at the story, maybe consumer discretionary, we've talked about autos, look at some of the airlines, look at the industrials. those are some of the places we think is good to start adding money to. >> the fed is tapering and they're looking at tightingen probably next year. it seems as though everything is driven by qe and that lists all the boats at the tide. is it stopped because of the markets or not? >> i think going forward, it will be much more because if the fed does raise rates, if the employment numbers keep coming out strong, what you're going to see if we're going to train on fundamentals, we're not going to

the second problem you have is we have 17 members right now of participants of the fomc.ot of are a lover country. the ability to get all the group precise to agree on paths of interest rates under the baseline versus other forecast, i think that would be actually quite difficult to do in a timely way. is a stretch.unum >> central banks around the world who have actually published forecast, typically, they have a monetary policy committee that is quite small and usually located in one place. the fed can maintain inflation expectations at 50%, rates of employment, unemployment, to help strengthen the compensation for the pores workers? -- poorest workers? >> i could imagine a scenario where the unemployment rate dips below what we view as maximal sustainable employment. i would be the mechanism to push it back up to 15% objective. right now, with inflation running below 2%, we need the economy to run hot for some time to actually push inflation up to our objectives. it is possible. with the objections released last week, they show that for , theparticipants unemployment ra