last september the fomc issued its statement on policy normalization principles, and plants. a statement provides information about the committees like the approach to raising short-term interest rates and reducing the federal reserve security holdings. as is always the case of the community we will determine the timing and pace of policy normalization so as to promote its statutory mandate to foster maximum employment and price stability. the fomc intends to adjust the stance of monetary policy during normalization primarily by changing its target range for the federal funds rate and not by actively managing the federal reserve balance sheet. the committee is confident that it has the tools that it needs to read -- raise short-term interest rates when appropriate to do so to maintain reasonable control of the level short-term interest rates is policy continues to firm thereafter given the level of reserves held by depository institutions is likely to diminish only gradually. the primary means of raising the federal funds rate we will be to increase community we will also use

the fomc in january described the economic recovery as solid. crisis has been over for a long time. and there is it's not as though there's no price to be paid by having this unbelievably accommodative policy. most immediately, i see the problem incured by my constituents who may have spent a lifetime working hard sacrificing, saving, foregoing a vacation, foregoing a splurge here and there and buy a cd have some money on deposit at a bank and use that to supplement a modest pension. of course their reward now is they get nothing. zero. that's what they earned on their savings. meanwhile, we have the risks associated with this. the risk of bubbles forming. i would argue the fixed income markets are a huge bubble at the moment. we have the inhibition of price discovery. we facilitate excess deficits because they look so manageable. and what are the benefits? the benefits are at best a timing shift in economic activity. at best, we're moving economic activity that would otherwise occur in the future closer to the present as we all know if artifici

if the fomc does not wait, what are the potential consequences?> senator, our objective is price stability, which we have defined as 2% inflation. as i indicated before beginning to raise rates the committee needs to be reasonably confident that over the medium-term, inflation will move up to its 2% objective. i don't want to sit down any single criterion that is necessary for that to occur. the committee does look at wage growth with not yet seeing hints or significant a cup in wage growth. there are a number of different factors that affect the inflation outlook. we will be considering carefully a range of evidence that pertains to the inflation outlook. we will determine the confidence we feel in our forecast and fission will move back up to 2%. we are seeing continued improvement in the labor market and that adds to that confidence. it would add to our confidence also that wages will pick up overtime. our objective is to percent inflation and we will look at a wide range of evidence. >> do you feel the worry of rampant inflation above 2% infla

last september the fomc issued its statement on policy. it provides information about the committee's likely approach to raising short-term interest rates and reducing the federal reserve's security holdings. as is always the case insighting policy, the committee will determine the timing and pace of policy normalization so as to promote its statutory mandate to foster maximum employment and price stability. the fomc will adjust the stance of the policy during normalization by changing its target range for the federal funds rate and not actively managing the federal reserves balance sheet. it has the tools it needs to raise short-term interest rates when it becomes appropriate to do so. and to maintain reasonable control of the level of short-term interest rates as policy continues to firm thereafter, even though the level of reserves held by deposit tower institutions is likely to diminish only gradually. the primary means of raising the federal funds rate will be to increase the rate of interest paid on excess reserves. the committee wil

last september the fomc issued its statement on policy normalization principles and plans.formation about the committee's likely approach to raising short-term interest rates and reducing the federal reserve security holdings. as is always the case in setting policy, the committee will determine the timing and pace of policy normalization so as to promote its statutory mandate to foster maximum employment and price stability. the fomc intends to adjust the stance of monetary policy during normalization primarily by changing its target range for the federal funds rate and not by actively managing the federal reserve's balance sheet. the committee is confident that it has the tools it needs to raise short-term interest rates when it becomes appropriate to do so and to maintain reasonable control of the level of short-term interest rates as policy continues to firm thereafter even though the level of reserves held by depository institutions are likely to residual only slowly. if federal funds rate will be to increase the rate of interest paid on excess reserves. the committee

last september the fomc issued its statement on policy. it provides information about the committee's likely approach to raising short-term interest rates and reducing the federal reserve's security holdings. as is always the case insighting policy, the committee will determine the timing and pace of policy normalization so as to promote its statutory mandate to foster maximum employment and price stability. the fomc will adjust the stance of the policy during normalization by changing its target range for the federal funds rate and not actively managing the federal reserves balance sheet. it has the tools it needs to raise short-term interest rates when it becomes appropriate to do so. and to maintain reasonable control of the level of short-term interest rates as policy continues to firm thereafter even though the level of reserves held by deposit tower institutions is likely to diminish only gradually. the primary means of raising the federal funds rate will be to increase the rate of interest paid on excess reserves. the committee will

and if the fomc doesn't wait, what are the potential consequences? >> well, for, our objective is price stability, which we've defined as 2% inflation, and as i indicated before beginning to raise rates, the committee needs to be reasonably confident that over the medium term, inflation will move up towards its 2% objective. i don't want to sit down any single cry tear yan that's necessary for that to occur. the committee does look at wage growth. we've not yet seen, there are perhaps hints, but we've not yet seen any significant pick up in wage growth, but there are a number of different factors that affect the inflation outlook and we will be considering carefully a range of evidence that pertains to the inflation outlook and will determine the confidence that we feel in our -- we forecasted inflation will move back up to 2%. certainly seeing continued improvement in the labor market, adds to that confidence and it would add it to our confidence also that over time, wages will pick up. but our objective is 2% inflation. and we will look at a wide r

you add the jobs report, the conversation of the labor and the fomc later. confused -- after the wages and thank you so much, jonathan ferro. wages, the boe, andy fed later. guy: we did the boe, we are waiting for the fed and we are waiting for greece. we have been asking you what you think is the answer to the question what should rolls-royce name its new suv? they do not want to call it an suv. i have a winner. an e-mail, just tweeted through -- "the off-color." francine: we also said overpriced. we had some pretty good responses. keep them coming. that is it for "the pulse." guy: off-color. tom keene is next with "surveillance." for our viewers in europe, we will be talking to the ceo of spain's electricity coming iberdrola that is coming up shortly. ♪ >> this is bloomberg "surveillance." tom: war continues amid cease-fire in ukraine. kiev evacuates 80% of soldiers from debeltseve. the ukrainian currency depreciates. s&p 500 drives to a record high as well as of worry come tumbling down. the careful pricing of luxury is aspirational. america would not be

will warrant an increase in the target range for the federal funds rate for at least the next couple fomc meetings. >> yellin told the senate banking committee, she's upbeat about the improving job market inflation is still weak in the u.s. europe and other regions face economic difficulties. yellin said fed officials will begin looking at the idea of raising rates on a meeting by meeting basis if the u.s. economy keeps improving. she suggested the fed will change the patient wording before it considers a rate hike. greece got the official nod from eurozone finance ministers for a four-month extension of its bailout reform plan. finance ministers of the 19 member eurozone approved the list of reform measures presented by greek authorities. the minister said in a statement, the list is a valid starting point but concerns remain. they're calling on greece to further develop and broaden the list in consultation with other eurozone nations. greece's structural reform plans are intended to rebuild the economy, boost growth and increase revenue. the plan calls for reducing the number of governm

conditions will warrant an increase in the range for the federal funds rate for at least the next couple of fomc meetings. >> reporter: it was an essentially neutral message that saw as dovish. the fed won't hike rates in june but it could just as well have been seen as preserving the fed's flexibility to decide at the march meeting to signal rate hikes this summer. yellin maintained an upbeat view on the economy and said oil prices would be a net benefit for consumers but said there's still room for improvement citing slow wage growth and inflation running below the fed's 2% target. yellin was grilled as expected by democratic senator from massachusetts, elizabeth warren. this time over the issue of what warren said were criticisms of a dodd frank financial reform bill by the fed's chief council, scott alvarez. >> do his criticisms reflect your criticisms or the the criticisms of the federal board? >> i think i personally and the board considers dodd frank to be a very important piece of legislation. this has provided a road map for us to put in place regulations. >> i appreciate that madam cha

. >> the fomc statement.one for, what i used to like a long, languid, liquid lunch. $300,000. on a lunch. for anybody who is not sure who this is it is shane smith, the ceo of vice media. it went from being -- gawker wrote a piece on the employees that they were not well paid. they rebuffed it and said they gave lots of things, benefits and vacation and bonuses. it was at the bellagio. >> $300000. we will talk all things greece and ukraine. stay with us. ♪ >> pressure mounts on greece as european officials reach a rescue deal. and the ecb grants cash-strapped banks a small increase in funds. we are at a critical and sensitive point in negotiations. we are submitting proposals and we hope we will turn this corner. >> fed fears u.s. officials indicate they will keep interest rates low for longer. given worries about the strong dollar and sluggish housing markets. >> the u.k. defense secretary of a real and present danger of a russian campaign of undercover attacks to destabilize baltic states. good morning and

the fomc minutes, i thought they were dovish. today yellin in my mind was definitely dovish. i have a stronger opinion about that than i think maybe nick or steve liesman, but, you know in my mind our official stance is we're going to see a hike at some point this summer. now, you, that could be june to september. really you're splitting hairs whether it's june or september. what you really want to know what the market needs to know is how quickly are they going to raise rates? are they going to do it fast? are they going to skip a few meetingsed, which i think they certainly will after they start. that to me magnitude and speed, that's what we really want to know, but janet yellin i thought really today i was thinking did she -- does she want the marketed to say, hey, the minutes were not as dovish as what some people thought or not, and in my opinion dove all the way. >> it certainly seems, scott, as if she's playing it very safe very true to nature. scott, do you agree with nick that the u.s. is still the same for play -- still better to stay in the u.s. than to europe or

>> i think the fomc is generally. the labor market has tightened.e are beginning to see wage growth picking up. of course, the economy is doing relatively well. the last couple of months, a bit of uncertainty. if you take a longer period the economy, is growing above trend. i was surprised to hear -- i was not surprised to hear what the fed chair was saying yesterday. then what we're looking at is an end to that section of guidance. we are looking at the data. >> you think the fed is navigating successfully away from a period of strong forward guidance to one where watching the data is the mantra. >> absolutely. normality is beginning -- that means the fed has to divide less direct guidance and be more swayed with what is going on with the data. not just the jobs report, but also gdp, wage data and the science of price pressure as well. >> i know that anna is our politics lady, but i think this article is great on bloomberg.com which is that we are in for a state of chaos, according to the latest opinion poll in the u.k. they will be devilish deals

we have the fomc minutes coming up. we asked our partners what typically happens to stocks and bonds on a day like this and it's very interesting. the movement really is in the treasury area. ten-year yields trade up higher. 77% of the time. that's since may 2013 when the fed first started talking about raising rates. the average return 1.2%. that's a few basis points in the ten-year. unfortunately, the s&p 500 and most of the stock market kind of indeterminate. it's only up 53% of the time on these days. the average return only 0.15%. i don't think that's very statistically significant. however, guys i do think it's interesting that the ten-year yield is up most of the time. guys back to you. >> all right. okay. bob, you mentioned let's get to dominik chew for more on that exxonmobil refinery. dom. >> we've got new information here with regard to what's happening. first of all exxonmobil has acknowledged that there was an incident at their torrence california, refinery earlier today at approximately 8:50 a.m. pacific t

. >> the fomc is it that it can begin to normalize policy means that it is unlikely the economic conditions will warrant an increase in the target federal funds rate for at least the next couple: meetings. cory: yellen also strongly criticized congressional efforts toward monetary policies say it would politicize the process. cory: meanwhile, christine lagarde and ecb president mario draghi both say that more strength is needed for great reforms. president obama has vetoed a bill approving the production of the keystone pipeline. the senate will vote to override it the veto. votes are needed to override in both houses. the pipeline would go through oklahoma, and nebraska. the fbi is offering a reward for the fugitives related to the hacking. he is the hacker known for the game over zeus virus that got over $100 million from victims. olbermann has been it taken off air from ees be a -- espn. he continued to send it twitters . after criticizing their difficulty with the english language than all apologized. espn called the exchange completely inappropriate. hewlett and packard's meg whitman s

he is a voting member of the fomc. it could be a potentially very important speech.will wait to see if the response in any way to the jobs report, any hints on whether they are likely to drop the word "patient" in a language and he is ready for the midyear liftoff. he could be a good indicator of how the overall view of the f one c is portrayed. -- fomc is per trade. matt: i believe we have from mike mckee really in the week -- no, we do not have it. professor krueger, he was saying we are not where we should be as far as interest rates are concerned. do you think the fed still has room to hold with great numbers?i think alan: this is a terrific report and to suggest that last month stint in wages was an anomaly. this is consistent with the employment cost index, which showed a mild increase in employee wages. that is very positive for the economy. if i were making monetary policy i would view the risks as a bit asymmetric. it is ok to run the economy a little bit strong. nonetheless, if we keep up on this path it seems to me that made it next year and maybe a little

flex the fomc is it that it can be -- it can begin to normalize policy means that it is unlikely the economic conditions will warrant an increase in the target federal funds rate for at least the next couple: meetings. cory: yellen also strongly criticized congressional efforts toward monetary policies say it would put aside the process -- the politicize the process. david kelly jpmorgan chief global strategist is not optimistic about the outlook. correct given the state of the -- grexit given the state of the greek economy and the strategy in the last few years, bring greece along long enough for the rest of the periphery and the european economy to get healthy and for the european banks to get healthy. and we are moving a good deal along that road right now. cory: meanwhile, christine lagarde and ecb president mario draghi both say that more is needed -- more strength is need for great reforms. ukraine accuses the progression rebels of using the truce to reinforce other lines of attack on the ukrainian troops. meanwhile, foreign ministers from russia france, and germany met today t

one of the fed presidents says that he thinks that they should drop the word patient at the march fomc meeting. is it that time to drop that language? >> they want flexibility. they want the option to make decisions as the data flows in. at this point cutting the words or not cutting the words it really is more directed towards observing the option and i do not think that it tells us much about the timing of the policy move and when it will take place. >> we think that anytime towards 2016. there is no way to know. mark: david, gentlemen, it is always a privilege to have you on the broadcast. >> thank you. mark: there is a new twist in the executive action over immigration. a federal judge in texas has temporarily blocked the orders for 5 million undocumented immigrants. peter cook has more on the decision and its implications. peter, how big a blow is this to the obama administration? or is it? : -- peter: those who support the president see it as a temporary setback. but they are confident in their legal position. outlined in a decision from judge andrew cannon, it blocks the adminis

we may not find out more till the fomc meeting on the 18th, however. >> the employment mandate.we get to what we assume to be the natural rate of unemployment that we are also waiting for the labor poor's -- force participation to rise. do we keep moving the goalposts? >> that seems to be the tendency. when i look at the wages and salary component it is consistent with what we see in the overall economy and the american consumer. the economy is moving ahead and the american consumer is moving ahead. >> we are going to be coming back to janet yellen all morning long. coming up, we are talking about china's great urban meyer gratian. it is not as great as it used to be. this is "bloomberg surveillance." ♪ >> good morning, everyone. "bloomberg surveillance." we look at single best chart. >> we are in one of china's golden weeks. this is important in a society where so many people have moved away from their hometowns. the great urban migration is the subject of today's single best chart courtesy of cardinal weinberg -- carl weinberg. we are looking in a slight change to the story we

mark: tony, all eyes are on that march 18 fomc meeting. chair yellen was careful not to give indication of where the fed would move during her days of testimony on the hill. she did not say if they are prepared to remove that patient language from the statement. have markets made it too much of the language? tony: probably not, because it is the fed's on doing. they said they wouldn't move on rates until a certain amount of time. interestingly, in share yellen's testimony, 800 47 words, about 300 of those were devoted to the word "patient," a single work, because it wants to soothe markets in terms of what it might do on march 18. one could look to the testimony for verbatim excerpts for perhaps what will be in the march 18 statement or whenever it is. if the fed says don't worry, we are not going to move now but we want you to understand that it is on a meeting to meeting basis, every meeting is live in terms of what and when we might move -- mark: the anticipation of a rate hike absent the patient language, is that giving the markets and

. >> on wednesday, tomorrow we're going to get the fomc minutes. you have a lot of people sitting on the sidelines waiting to hear if they change the language in tomorrow's statements. if they take the word patient out, what does that mean? does that mean that june is a go, or does that mean potentially june is a go? >> 1.6%. 2.1% on the ten-year. that's got my attention. >> all right, guys. let's take a look at those yields. this is a big move that we're seeing in the treasury space right now. three points away from 2% once again on the ten-year notes, and also moves in the 30-year and the shorted end of the curve as well. let's get back to the equity side because it looks like some of the money might be rotating into stock markets. we have two bulls joining us now. we have phil chief equity strategist and jeff chief investment strategist at raymond james. both of you have some pretty lofty targets there for the s&p. >> by our measurements, there are oodles of internal energy here for a sustainable move. very fast up through 2200 on the s&p. >> yo

a lot depending how the markets reashth to the first interest rate increases by the fomc.er revised down 2.2% from 2.6. but the internals are okay. consumption remained a strong 4.2%. business investment revised up. equipment up. the downward adjustment to the inventory number, that means less of the inventory to work off, 25 billion or so less. this question outlet for interest rates, outlook for fed policy and the outlook for growth part of the interview i have coming up with stan fischer, 3:15 p.m. this afternoon. >> i'm excited for that steve liesman. don't get to hear from stan too often. the maestro of monetary economics. we'll look forward to that later on. >> i wouldn't call him -- sara i wouldn't use that term because the last time somebody was called maestro, it didn't work out too good. >> the great adult. that was his nickname. >> that works. >> that works. >>> retail now. tale of two turnarounds, different paths here. jcpenney missing estimates, while gap beat. both companies detailing path to profitability for investors on conference calls yesterday. courtney

looking at that average hourly earning number and moving to the fomc announcement next month and the press conference that comes from fed chair yellen. >> is the treasury trading on that fundamental information now? are we at a point where it can pay more attention to fundamentals than fed policy? >> i think it has to pay attention to both, obviously. if the fed raises rates, that lifts rates across the curve. we think with this environment, you know inflation as well as it is well below their target with negative yields in europe and deflationary pressures from abroad. so yeah clearly normally when the fed raises rates it's because the economy is overheating, not because we barely got to 2% on hourly earnings. >> that's what we'll have alan greenspan weigh in on as well. nobody wants to talk about energy. oil has a move lower that might be impacting the market and they are just waiting on this rebound, waiting for it to move back up. >> listen i think we're in a bottoming action. i this i we waste too much time on energy. we're going to have to wait until the average retail-type ame

i was surprised last week to see the fomc came out. i thought it was relatively dovish. i don't quite get that. where are you on that? >> i would completely agree. if the fed does any type of rate movement this year, it's going to be a token 25 basis point trial balloon. i would have to air on the side of, you wanted to liquefy the banks balance sheets. that makes no sense to me. >> apple and these other companies are doing it because they're taking advantage of low rates. >> i would say our outlook right now is 1.5 to 2.5%. the downside caveat being if quantitative easing in europe is a failure or some other major event. but rates could go down. >> it's interesting. people forget how far things can be taken beyond historical norms. a lot of portfolio managers said bonds have been a drag because stocks are doing so well, maybe i'll lighten up further. this is the kind of thing that can go on, especially when you look where they are in europe with negative rates. how extreme though for u.s. bonds is extreme? how close are we to looking like switzerland for example? are we

is my good friend bill dudley, whoever the president in new york is, gets to be vice chair of the fomc cleveland votes every two years as well as chicago. this is not 1936 any longer. it's not the 19 60s. population trends change. federal reserve district has grown total over a period of 1970 to today by 9%. our federal reserve district 121% of population and san francisco fed 112%. >> we need to reflect that. >> my idea was to take away the steam from this and we can talk about it later, but giving all six presidents a vote, six governors a vote, rotate so you have every two years all 12 presidents vote, and then make the vice chair every two years would be one of the federal reserve bank presidents. >> okay. >> rather than the new york fed. >> read about this online. thank you for joining us. richard is going to stay guys to talk about the other controversial issue in washington, which is the issue of auditing the fed. we'll bring you what he says about that in the 3:00 hour. brian, back to you, i guess, in houston. dallas to houston, buddy. >> thank you very much, thank you mr. fish

and what that does is change the dynamic, it changes the nature of the conversation with the fomc.s an opportunity for politics to enter into the debate about policy. and i think debate's fine, but don't put at risk the decision making process. keep the debates on the outside. >> reporter: so you're worried that politicians could, for example, keep the fed from raising or lowering short-term interest rates because of political intimidation? >> well, intimidation may be too strong a world, but certainly have the ability to sort of say we're going to audit -- we don't like this decision, so we're going to audit you. if that happens in realtime, imagine the nature of the conversation within the fo to mc room saying, well, are we going to be audited for this decision or not? >> reporter: could have a chilling effect. >> it could have a very chilling effect. >> reporter: let's talk about the interest rates, and right on time our friend jon hilsenrath at "the wall street journal" has this article: fed chorus grows louder on potential june rate hike. we heard your colleague from the cleve

. >> number one thing, fomc meeting. minutes of january meeting come out on wednesday.se what the fed's thinking. we know they want to raise rates. they, didn't say one thing publicly and said another thing privately but in these minutes you get a much richer picture what everyone with is thinking there. that is the big thing to watch. throughout europe you will get consumer price reports an producer price reports of all countries in the eurozone. gives you idea where the inflation, deflation picture stands in europe. that is a big story. those are two big economic things. david: sticking with the first one, warren buffett with liz and other people have said that the dollar is so strong right now, that it would be the worst time to raise rates because it would strengthen the dollar even more and hurt exporters. will we get a sense of their feelings about the dollar? >> that is the big thing. the market is starting to get the idea in its head, situation is changing, the fed will have to push things back. the fed has not intimated that. you want to know if they're talking

what was striking to me is when we got the fomc minutes a week or so ago, banks sold off on notion that rates would remain lower for longer. today we get the same message and we have a rally in banks. why the discrepancy? >> a broader market rally. well, i mean, we're going to talk about jpmorgan. so let's sort of shelve that for a second. >> it's its own little -- >> i think that helped as well. a lot of these housing numbers also i think help the banks. i don't think people believe by the way that the yield curve is not going to move to their benefit. thing are a lot of people in the camp that rates are going higher. i'm not one of the people. i think the tlt bottomed last week. i think we see a move lower in rates. does that mean banks decouple? i don't think so. i think banks might be getting . one was the leadership of jpmorgan today. >> do we stay long tlt at this point? did yellin give the all clear to remain long tlt for a little bit longer? >> well, you know, it does make you wonder. obviously, we all think this thing got pushed out. and she talked about patience being one of t

. >> the fomc's assessment that it can be patient in beginning to normalize policy means that the committee considers it unlikely that economic conditions will warrant an increase in the target range for the federal funds rate for at least the next couple of f.o.m.c. meetings. >> ifill: also today, eece greece staved off bankruptcy as european creditors agreed to extend its bailout by four months. that came after the new greek government pledged to fight corruption, and guaranteed new social spending will not bust its budget. bombers struck with deadly effect today in two widely separated countries. in iraq, at least 40 people died in car bombings and other attacks in and near baghdad. "islamic state" militants were suspected. and suicide bombers in nigeria killed at least 26 people. authorities blamed boko haram. also in nigeria, an american missionary, reverend phyllis sortor was kidnapped last night. the "free methodist church" said she was taken from a school compound in kogi state, possibly for ransom. and islamic state forces have abducted at least 70 christians in northeastern syria.

i find it interesting after fomc meetings, for sure, the fed said spring. where did they say that?nflation? >> just anytime, when you go to breakfast tomorrow, anyone can tell you there is inflation. starts at beginning of the day all the way through. >> you have a big show tomorrow night. you will be live in orlando, florida, at the money show. >> yes. >> called the money show. a huge audience. 500 people. they will ask you whatever they want to ask you. what will come up? >> that is very exciting. i used to take my company every year. i spoke in front of 3,000 people. they say it will be 700 tomorrow. i think we'll hit it. they want to be in control of their investing lives. to your point they want to filter out this stuff. at end of the day i'm 40 years old. i don't care if the fed raising rates next week. i want to own quality american companies and live in my golden years and have my kids a honest shot in this country. david: you are patriotic. watch your show at 6:00 p.m. >> lots of earnings to go through besides gopro, guys. david: absolutely. an important night to see charl

remember the fomc statement said we may get more aggressive if the economic data is better than expectedet a little less aggressive it isn't. what they're going to be looking for is some indication which side she's leaning on. we will get some indication what's going on fairly shortly. >> all right. thank you, guys. have a great weekend. appreciate it. all right. ty, over to you. >> thanks sue. there are spies on wall street. the department of justice stepping up efforts to demonstrate just how foreign intelligence services are trying to penetrate firms and institutions. this in the wake of last week's takedown of the russian spy ring that tried to do just that. eamon javers spoke with the department of justice assistant u.s. attorney general for national security john carlin. eamon. >> i talked to john carlin this morning in the wake of that russian spy ring takedown just last week. the department of justice now has a new warning for wall street saying that foreign intelligence services are active on wall street and they want the secrets inside wall street firms. i started by asking car

she has unanimity among the fomc, the voting members, so given that she's got that behind her until youtart seeing a lot of people depart from that she's got all the ammo she needses. >> coming up, what's ailing snab after a huge ipo the stock having a rough year thus far, top tech analyst bob peck has a buy on alibaba. is he keeping it? then, are the traders not drinking enough sam adams? the stock is down big today. we have the trade coming up. as the nasdaq nears its all-time high, gets closer to 5,000, should you you be nervous about a bubble? we talk to a former google employee. venture capitalist who has three reasons why this is not the same as 2000. all straight ahead on the half. there's a difference when you trade with fidelity. one you won't find anywhere else. one-second trade execution. guaranteed. did you see it? in one second, he made a trade, we looked for the best price, and the trade went through. do the other guys guarantee that? didn't think so. open an account and find more of the expertise you need to be a better investor. sometimes, at last doesn't happen at first

we will get the fomc statement letter -- i'm sorry, minutes for january.e there? underlying instability in these markets, but equity is acting well. >> how do you position yourself given all of that? >> we want to get incrementally long but do it in a way that respects the fact that there is underlying instability. then we will talk about the option strategies that make sense in this type of environment. what i mean by that is a higher floor for volatility. one of those is just overriding and that means you a stock and sell calls that represent the same size of the underlying position. it's just a strategy to increase the yield of your underlying position. a great strategy that fell by the wayside when vix was 1012 at his -- at its florida great way to generate yield on underlying long stock's editions stop the other is stock replacements will stop a name like netflix -- we have screen the s&p 500 for names that have performed year to date that are at or near their consensus price target. so, fully valued, arguably. if you are long stock and there's not an

the fomc is providing forward guidance that offers information about our outlook and expectations for the future cap or the enteral -- federal funds rate. the committee judges that it can't be patient and beginning to raise the federal funds rate. this reflects thef fact that inflation runs below this. the fomc's assessment that it can't be patient and beginning to normalize policy means that the city believes it will warrant an increase in the target range for at least the next couple of meetings. >> if you miss this he can watch it online at c-span. work. henry cuellar is our guest here and welcome back. guest: thank you so much. host: the senate republican leadership has decided they will hold two separate votes. later in the week they will have a separate vote on the executive action on immigration. it do you democrat should support a clean home and land security bill? host:guest: without a doubt. we have been doing lending for hundreds of years. one of our basic responsibilities as a congress is to pass a budget. if we have a disagreement with a policy issue, that is a separate t

considers that i'm likely to be economic conditions will be in a target range for the next couple of fomc

it does seem that there seems to be many members of the fomc who are concerned about the implicationsse and what that would mean for what appears to be a fairly robust recovery. what are your thoughts and when we will see the first hike from the fed? >> i don't think it will be this year. i think the fed is looking in detail at the labor market. the data from the labor market is not so bullish as the data and the general economy. a very high proportion of the new jobs that were created with the recovery are in the oil-producing states. that is an indicator that the labor market has not recovered completely. i don't think that the fed will want to do anything that will make the recovery of the labor market more difficult. that is one indication. the issue has to do with the strengthening of the dollar which is very marked at this moment. increasing the interest rate may create capital inflows and affect the dollar even more. on current information we are not going to see increasing interest rates very quick. >> is this more to do with the fed saying, we are not ready or this currency w

we are going to get minutes from the last fomc meeting next week.ro finance minister meeting. we will have humphrey hawkins testimony in two weeks. all these catalysts that can rattle the consensus thinking. you want to be present should -- you want to be positioned fairly defensively. >> a retail sales the port -- a retail sales report today was pretty disappointing. and a lot of companies will be reporting earnings next week. >> foreign exchange, travel agents, another big headwind, the holiday sales haven't turned out as great as they have come especially for big-box retailers. i like a defensive strategy in the frt, which is a retail etf. the 94.88 spread is a cheap way to position for downside in the retailers. i think that is a smart player. >> so far, you are looking to profit if the index goes down. what we have done from the companies anecdotally is that things looked ok in the holiday season. >> i think that plays into my strategy. i think sentiment is a little bit euphoric. you had double-digit percentage moves. so there is some positive

maybe if we get comments from janet yellen tomorrow or at the march of the fomc..s., when we look at risk premiums government bonds are expensive. it does not mean they cannot go lower and yields per you have to have circumstances play out. you need inflation expectations falling, you need global and u.s. growth falling. we are seeing a meandering economy that seems to be percolate upwards. not as much as we had hoped for. inflation expectations have come down. we think that is more temporary relative to oil. it will probably start to move higher towards the second half of the year. i'd argue we in a sweet spot for treasuries. they might grind a little higher but i don't expect them to move much higher. olivia: you know where there is inflation, disney world. the cost of admission is up over $100. jim caron, fixed income portfolio manager from morgan stanley investment management. as we head to the break, i would love to hear from you. answer our twitter question. do the oscars matter today? did you love dakota johnson's dress. we want to know. tweet us. this is b

neil: those that are bullish on bonds, the doves on the fomc, go down the list. the u.s. economy is growing around 3% and that is more than enough to keep pushing the unemployment rate down and the fed, by their own admission, as for themselves in a corner -- have put themselves in the quarter. that is why they are having so much consternation about what will happen after they removed the patient language. patient language -- alix: will they offset that in some capacity? neil: they made. the big risk for the fed is how do we keep the markets from pricing in the full tightening cycle after the first volley? stephanie: whoa, whoa, whoa walk us through that. neil: how do they avoid a taper tantrum? more people are going to expect rate hikes and a more aggressive pace of rate hikes. there will be problematic for fixed income investors. alix: what are the chances we will see smaller increases? not 25%. 0.08 or something, very marginal? michael: they haven't done that since the early 1990's. whether or not they would go beyond that in language is the real question. do they tell

what the fomc is thinking and how they're analyzing this very difficult problem set remains a mystery, however. yet some continue to dismiss calls for change or more transparency at the fed. i would argue, however, that there's an even greater need for additional oversight by congress and further reforms. our centralback is expanding its influence over households businesses and markets in recent years. not only has it pushed the boundaries of traditional monetary policy but it's also consolidated unmatched authority as a financial regulator. as the fed grose larger and more powerful, much of this authority has become more concentrated in washington, d.c. nand new york. the fed emerged from the financial crisis as a super regulator, with unprecedented power over industries it had not previously overseen. with such a delegation of authority comes a highn't re-- responsibility i believe, for congress to know the impact these new requirements place on our economy as a whole. the role of congress is not to serve on the federal open market committee. but it is to provide strong oversight an

we're going to into march focused around the fed's fomc meeting and talking about getting off of zeron. for the bond market that's not priced in. a big disconnect shorter maturities, that's your source of market volatility as we reprice fed expectations. >> i guess the point there would be the question to whether the market will accurately price when the european central bank is about to start buying bonds majorly. what is it $70 billion a month as of next thursday, i mean that's when potentially they could come through the announcement. yields driven negatively in europe. that's got to keep the yields suppressed here which argue what you foresee may not be realized. >> i'm not sure about that. that's the popular narrative that negative yields the rest of the world, what the ecb's doing, has to hold u.s. interest rates down. i think we've got to be very careful about thinking about the global impact balanced against what the fed is going to done what janet yellen emphasized yesterday is the means to which they're going to raise interest rates is something very different. this time is

. >> i think you've got three voting members of the fomc saying june would be a good time for lift-offrepared for this? that's the biggest question. >> you know i think markets probably still are looking at some of the recent you know u.s. economic data which disappointed around the edges, and probably going maybe the fed's lifting off a little bit early. said it enough times where markets are prepared for some rate hikes this year but that being said if they were to do something, you know aggressive i think that might catch markets off guard. i think at this point, june or september's baked into where consensus is. >> would you agree you believe that the fed will raise rates in the summer, in june what do you think the market reaction to that will be? >> no actually we think that the fed might be on hold for much longer. in fact most likely for all of 2015. what we are watching in particular is the fact that the fed has inserted the term international developments at the last statement and that could, of course, refer to many different things but most likely refer to the developments

one, after the january fomc meetings, in your readouts, one of the items you mentioned were international developments. obviously disruption, potential in europe with the ongoing struggles with greece. china's slowing economy. can you rank or how will these international developments affect the fed's decision on timing on monetary policy? >> there are a broad range of international developments that we monitor and they do affect the performance, the likely performance of the u.s. economy and factor both into our economic forecasts and our assessment of risks. growth in europe has been very slow. growth in china is slowing. the huge decline we've seen in oil prices has had repercussions all over the globe. in some areas, very positive. in other areas, negative. it affects our outlook, these developments, both through trade flows and through developments in financial markets. the attempts of many central banks to add monetary policy accommodation is pushing down longer run interest rates in many parts of the world and that's, as i mentioned in my testimony, spilling over to the united state

. >> rotate the fomc chair now held by the new york federal reserve bank that has a permanent vote.istrict bank president vote and six governors vote right now those bank presidents are on a rotating chair. the fed chair would vote to break a tie. then regulars late the big important financial snugs in separate districts from the ones where they are head quartereded. >> fisher is bringing up an important point. this federal reserve system as it was structured came from 1913 and then again it was overhauled in the 1930s. i think this in part it's time to change it. there are two banks in missouri as you know. the west is under represented. the south underrepresented. the northeast probably overrepresented. he talks a lot about that distribution. in terms of being more of a democratic organization, the fed should be overhauled. >> the general island branch. don't get into that. >> thank you, steve. up next did rite aid make a wrong move? we'll debate that with point counter point, and fresh video that includes tax season doesn't bring out the best in all of us. oh, wow. power lunch ri

>> and for me it's the fomc minutes that will come out on wednesday. >> i'll leave it right there.ppy valentine's day. thanks for joining us on this friday. >> i have to go. i have some shopping to do. >> you have been discovered. now we know the secret of your success as well. that does it for us on "closing bell." "fast money" begins right now. >> "fast money" starts right now. live from the nasdaq market site overlooking the market square. i'm sara eisen in for melissa lee. here's what's coming up on "fast." alibaba releasing into kor son dense. we'll break down the china trade. and netflix closing up 2% today after one analyst said the company would be making a $5 billion bet on content. but we'll start with today's record breaking market move. u.s. stock at all-time highs. the s&p 500 and