no great divergence from what janet yellen was talking about. it seems that most of the committee members were with her in terms of patients, so they will lift off at april at the earliest, if conditions hold as they are now. >> our chief washington correspondent peter cook. peter, thank you. let's look and see if there is market reaction to the release of the fed meetings. julie hyman joins us. what a couple of days make on wall street. >> yes, and the minutes do not initially appeared to be making much of a different spirit if you look at treasuries, not an enormous amount of difference in where we were a few minutes ago before the minutes came out. they do seem as peter was talking about, to reemphasize the message the fed had already put out there. there is more work in the details, but not necessarily any large surprises. you have to keep in mind the context. the rebound that we are seeing in stocks is off a fall the worst we've seen about 13 months. you might have investors coming in and going, maybe some of this outlook for rates going up

janet yellen or tim cook at apple. mark zuckerberg of facebook or boeing which came out with decent numbers this morning? the federal reserve just released its statement. the buzzword everyone was watching for was patience, which just describes the fed's state of mind in determining when to raise interest rates. the word remained, however, the fed suggested economic activity was now solid, which seemed to cause a market sell-off after a big jump, initial jump, after investors feared an investment hike would come in june of this year. ceo tim cook caught off guard calling the iphone six sale, quote, staggering. can his might us touch rub off on mike zuckerberg? investors will want to see how mobile app sales are adding up. what about instagram? are they monetizing on that. how much is zuckerberg spending? boeing, forecasting a big jump in cash flow from $4.3 billion to 6.2 billion, sending shares of this dow component sharply higher. what are investors watching in the most closely? what can we expect from facebook after

i did not vote for janet yellen. i knew her history. she was a very lax regulator, i thought. others did, too. she has been there, what? a year now? we will see about the federal reserve. what matters now, the portfolio of the fed. all of those bonds, the securities they bought, what are they going to do with them? how are they going to deleverage? this is unprecedented. >> so, you are looking at oversight on whether they can do those securities, quantitative easing? >> absolutely. >> what about legislation? we have senator paul talking about -- >> i am very interested in the fed, especially the portfolio. i do not want to be a member of the federal board of governors. but as oversight, we should make sure that they are doing right. no other questions about the portfolio of the fed. >> can you have an audit of the fed that does not pass the metal of -- >> it depends on how you define"mettle." what we're talking about our substantive things. >> what about fannie mae and freddie mac? you were big critics about them before the financial crisis. what about the plan to unwind them?

>> driven by janet yellen turning a dial at the fed. david: it's not hurting overstock. you were up 60% over the past six months? >> well, you asked me about the market. i don't care about the stock price. what's gone on is we're patient with a bad root canal and we have a dentist giving us bigger and bigger doses of novocaine, and novocaine is okay, you want it but you want someone to dig out and fix the problem and there is nothing fixed. david: they're not getting to heart of the problem, i assume you don't think the european plan to buy up government bonds, the european central bank just came out on is going to do good over there. >> it will do good. it is novocaine. it will do good in the short run. i support the greek left. you are my friend, milton friedman. he used to describe the european union as intrinsically unworkable. it's a fiscal unification, it's a monetary union but not a fiscal or political union, so it doesn't have the mechanisms where you can have internal adjustment like you do in the united states, he thought it was doomed to failure, the greek lef

patience is still the word for janet yellen and the fed. patience remains the fed's key word on raising interest rates. the fed's statement noted that economic activity in the u.s. had been expanding at a solid pace, and that inflation would rise gradually towards 29% in the medium term. >> a renewed vow of patience from the fed could prevent the biggest two-day sell off in the dow in a year. weaker oil prices took energy stocks lower and multi-nationals, p & g, dew point and pfizer cited concerns about the strongest dollar in a decade. >> another central banker the bank of england governor has been more effusive in his language talking about the euro and the eurozone. he says the european central bank's ban on stimulus package will not be enough on its own to solve the problems. he suggests action is unfinished. >> there is mcchange at the top. that was terrible. mcdonald's is replacing its c.e.o. as the u.s. chain's sales sunk to a worst in a decade. british born executive steve easterbroork will step up after the current c.e.o. leaves. s

italy can grow even without complete transformation. >> janet yellen's world changed. not have a ruben dollar yet. >> think about how much the dollar came down and how much things have gone back. you have lost a lot of ground against the yen. it is above parity. chinese currency has been stable since the dollar. >> you cannot believe the food cost. can i stop the show to say a bowl of soup is $22? i am not kidding. >> you study this for decades. we need to do it better. do you see any impediment to us in the future? things get messed up and we fix it. >> for all of the things we look at, it is amazing how unbalanced. there is an issue in our health care system. we would be better off if we were not throwing away a 10th of gdp away on wasteful health care. kids in the less welldoing schools are getting hurt. with greece or italy, that is not everything. >> let me bring it back to what we saw in the ecb. we will buy negative interest rate bonds. that is not in the books i studied. what does it signal that a bank will manipulate, purchase, or hold a bond that is priced so

that is the difference the janet yellen faces today. >> we will see whether it has the desired effect. this is just a things the central bank can do. whether it will have an effect that will be interesting. >> we will have full coverage through the afternoon on what your federal reserve does. to apple. they simply made history yesterday. brian weiser joins us from portland oregon. we will talk about the cupertino cash machine in a bit. the fed. >> it is the first do no harm type of fed meeting. the could just make slight upgrades to the economic assessment and walk away and that would be a successful meeting. we are growing at a 5% annualized rate over the last two quarters. >> let's look at the debate. simon kennedy's quote. the basic idea is that morgan stanley says, we are going to delay. the lowflation expectation presents a persistent downside risk to the u.s. outlook. she is front and center, isn't she? >> absolutely. the fed is trying to be patient. financial conditions are already tightening given the strong appreciation of the dollar. the stronger dollar is going to weigh on

do you agree with janet yellen? >> i believe the fed should not raise rates until and unless there is clear evidence of rising inflation. whatever happens to the real economy. i do not think we have yet seen any evidence of rising inflation. if anything, the evidence is pointing to, in the medium-term a reduction. janet yellen is right to say it has to hinge on the data. she is right to say the fed is going to be flexible and respond as events come >> you read the data different than she does? >> i don't know. i think we both read at this moment. -- read it the same at this moment. i'm not sure how they will rbgh have. -- read the data. i would not raise interest rates as i thought the economy was overheating because it had grown fast. i want to see the proof in what is happening to inflation before it would be appropriate to raise rates. the reason i think that is if we let the, inflation raise slightly. we have seen it before. we know how to control it. if we allow deflation to happen that is potentially catastrop

that is why janet yellen is saying, we need to look beyond that.here is a year or six months where there is a very low reading. what you hope is that it stimulates more demand because the fall in the oil price, let's be clear, is a significant transfer from savers to borrowers. from the savers in the middle east to the borrowers who use the product. >> we obsess over inflation in europe. let's talk about it in asia after the break. we will take the conversation eased. weaker data out of china stoking expectations that the government may ease more. black rocks big question, will they move to devalue that currency? ♪ >> welcome back. i'm jonathan ferro live in the city of london. china inflation extended a record drop of decline. is this another sign that the chinese government may be ready to do more on the easing side? big question for you, will they devalue this year? will they have to devalue the currency? >> the dollar is important part of the equation. i think the calculus is this, if you let the currency move down which is what they would do r

let's not, by the way, forget this is janet yellen we are talking about, right?sh fed overall. they would rather be lakes to the party then run the risk that they shoot the dollar up even higher and hurt exports and this economy and send us back into recession. so it may not be the best policy right now, but it is all we have, and they will likely staying the course. >> trish is focusing on an important point here -- taking away the punch bowl. you can take away the punch bowl in a number of ways. one is through fed rate hikes. the other is through a stronger currency. manager conditions are tightening as a result of the stronger dollar. it is doing a lot of work for the fed. >> trish mentioned weaker inflation. let us assume for the sake of argument that we are halfway through 2015 and inflation is still below the 2015 target. does that mean the fed would necessarily not move on raising interest rates because of the? >> it does not mean necessarily they will not move. they have talked about taking the leap of faith and confidence inflation will turn around. we s

>> we learn the fed is going to stick with the plan that janet yellen laid out in the press conferencen december. she said they are not going to raise rates until april at the earliest. a lot of those messages were reinforced. >> can they do that or our markets tell them what to do? >> the fed is still reacting to the taper tantrum of 2013. everything about this is designed to be methodical. the markets are not methodical but they are trying to get them to be. >> please, you are killing me. >> the events are overtaking the fed gas prices among them. oil falling is good for the consumers but below $50, it starts to signal something terrible for the economy. >> the fed sees the risk as balance between the doubt -- between the downside. they are hedging their bets. this will have an effect on the american economy eventually. it's still an american domestic and driven consumption. >> i don't mean to interrupt but the only place that does more on the other hand that the council on foreign relations is the federal reserve. >> when tom says i don't mean to interrupt, it means i am going to in

you see janet yellen talking about the measure and if it were to hit 6% or 5% or closer to a naturalate, i think a lot of people would argue it's significantly worse than that. you have a record number of veteran employees who have dropped out of the labor force. they are not exactly saying but i lost my job but the dow broke 18,000 so my 401(k) will be okay. i am not getting income but capital appreciation. you are not seeing that. you are seeing more evidence of income inequality and the have did having more and the have-nots having less than we have seen in thesince the 1920s. there has not been a populist backlash with this. there is still this sense of learned helplessness across the country. people who have jobs want to hang on to the jobs. host: the issue of under employed, left the marketplace, but let me share this one tweet from a viewer who sends this comment a lot and it's recommend vant to what we are talking about today with $18 trillion in fed debt. servicing that debt paying interest rate at below 1% interest eating up 6% of the budget he says. guest: 6% of the budget

janet yellen is speaking with consensus behind her. >> only one country. lisa, thank you again.onday have a wedding in your future or perhaps you know somebody who does? the website isn't spending -- is expanding looking for new ways to connect consumers to wedding planners. in the meantime, have yourselves a great weekend. it feels like we just had one yesterday. it is great to have another. see you monday. ♪ >> it is 56 past the hour. bloomberg television is "on the markets." let's take a quick look at the major averages. the markets started the new year off in green but has given back all its gains. stocks jumped out of the gate with the downed gaining 128 points. now the major averages find themselves in the red. joining is the chief operating officer at keene on the market. what is the action on the vix look like today? >> happy new year. we are seeing the vix continued to move higher over 19 while futures are trading over 1850. the last day of the year was volatile with the downside move in the s&p 500. like a lot of these moves we have seen over the past few weeks in the

is janet yellen glued to her bloomberg terminal at the fed? is that a shameless plug?no sound the backs for shameless plug's. >> the fed focuses on global events on the extent they outlook the impact for u.s. inflation or growth. at some level, decoupling is not feasible. the u.s. will not -- >> were way to get into that says, you would not have decoupling. you have a strong dollar that lowers deflation and commodity prices. that challenges the fed as they want to start hiking in the year when prices may be falling. >> oil as it drops below $46. we keep asking you for a number at which things will start to change and you keep saying, we do not really know. i am going back to the well. >> will they change here? will chevron, will they change their behavior this morning? >> in q1, we will see the press releases, and we will get a flavor for what that capital spending is going to be like for 2015. they are resetting their priorities around for a higher return inventory. even with cuts -- even with cuts you will see the resiliency of aspects. you are resetting expectations

janet yellen not looking like she's going to raise rates any time soon.e printing more money. that's what some investors think, and investors love. the dow industrials up 283. all-time highs, home depot and walmart never higher than where they are now. oil off its lows $48.58 where it is now, maybe it's coming off the low, maybe it's formed a bottom we shall see. u.s. ten-year treasury the yield back at 2.01%. staying on your money. here's charlie gasparino. stocks are riding high. do you think this is all about the federal reserve and janet yellen beats the terror threat from paris? . >> there is an aspect from the terror threat which we should talk about. when you looked at the stuff that came out yesterday from the fed, the fed minutes and what they were talking about is the potential for a global slowdown. and that's what got the -- and the potential if there is a significant global slowdown to re-evaluate current policy which is to raise short-term rates in the near future. when the market saw that literally, when the headlines were crossing the tape

. >> and my personal pick is stanley fisher vice chair of the federal reserve more than janet yellen is determining when and how fast they raise interest rates. we'll watch him. that's it for this week's show and thank you to my panel. i'm paul gigot and we hope to see you here next week. >>> new tensions between new york city mayor bill de blasio and his police form. welcome to "america's news headquarters." i'm arthel neville. once again officers turned their back to bill de blasio at the wake of wenjian liu. he was one of two officers killed in cold blood last month in brooklyn. funeral arrangements were delayed so family

today, janet yellen fed chair indicates rates won't be going up anytime soon. don't know what she will say. we'll find out later this afternoon. maybe we have a strong jobs report on friday. maybe those two factors helping the market. what do you say, mary? >> any ral i you see today is based on a hope somehow central bankers will swoop in and save the day. it might have something to do with the fact we had such a steep fall earlier in the week. traders may have come in saying that was overshot. one thing to note, it isn't just janet yellen, earlier this week the san francisco fed chair came out and also say, rate rises are in the future. if and when that happens it will be gradual. stuart: that drop in the price of oil really changed things a lot. >> it has. a huge change. stuart: president obama the obstructionist? already threatening two vetoes barely one day into the new countries. and speaking of the new congress, i give you awkward picture of the week, of the day. there it is. on the front of "the wall street journal" this morning. speaker boehner nancy p

when janet yellen sounded bullish on the u.s. economy, the markets are pushing that first interest rate hike further out but still this is a question very much on investors minds. you're seeing that play out again in this session over here in europe. so you're seeing it underwater. >> indeed let's look at bonds. that fed statement yesterday was accompanied by general risk off sentiment and u.s. bonds going up yields going down 1.75%. that's where they have been since the meeting last week moving in the other direction of course greek yields. 11.3% we're currently looking at on the tenure. that's another big move from where it closed yesterday. five years now at 14.6% up the best part of 3% today and the three year is up 4% today at 18.1% so the short end of the greek curve moving very sharply. fears of course on a debt default following the election of the government. the u.s. dollar moves following the fed meeting yesterday. slightly muted. not too much happening there but as you can see the biggest mover today is the dollar up

later after janet yellen's press conference, they looked at it a little more hashishly.ooking under the hood with the minutes that could hurt stocks more if they believe the fed will be more active in the year 2015 or could see a little bit of a relief rally if we believe the fed is on hold for a little longer which i think ultimate backdrop selling it you. david: todd, thank you very much. markets dropped precisely when oil began tanking again. maybe this is what is spooking markets. last time it fell this fast right before the great recession in 2009. is that where we're heading now? we have jared levy, profitable trading.com chief risk manager, larry shover, sfg chief alternativeses chief investment officer and tracy byrnes. could we be headed -- we have to fix your mic. larry, let me go to you, could we be headed for a recession? >> i don't think so. not because of oil. look at last 40 years, there have been seven episodes of 35% declines or more in very quick fashion and you can't say equities have done one thing or another in those seven episodes. it is really abou

. >> my personal stanley fisher obscure, voice chairman of the federal reserve, more than janet yellenredibility in financial markets and will be a crucial voice at the fed in determining when and how fast the federal reserve raises interest rates. so we'll watch him. that's it for this week's show. thanks to my panel and all of you for watching i'm paul gigot, we hope to see you right here next week. >>> an amazing story of survival, a 7-year-old girl in kentucky miraculously walking away from a plane crash. four of her family members on board were killed. the faa says the small plane reported engine trouble and minutes later lost contact with air traffic control. hello, welcome to "america's news headquarters. >> we're learning now that 30 minutes after the tragic crash the young girl was able to walk away, kept her compose you're and find help on her own by knocking on a door. will carr is live in los angeles with the latest on

janet yellen and her cohorts will release a statement tonight in terms of the language they use. that, it wobbles. it shook the market. it shook the equity market down 300 points. caterpillar, microsoft, all talking about a strong dollar. 300 points isn't enough to stop the juggernaut that is the dollar. goldman sachs say, by the dips. the trajectory of this currency is still on the upside. if you wondered who was the busiest, it is of course the fx desk. currency trading was at a record. the highest level since 2004. not to be left out of the party, aussie dollar makes a comeback. 80, hello 80. they've got inflation. higher inflation than the market originally anticipated. that is why you see a rate cut from the aussies next week. how quickly the trade has changed. 1.7% now. hello, 80. >> thanks, manus. these are the bloomberg top headlines. apple has reported one of the biggest quarterly profits ever made. it enjoyed a net income of $18 billion after revenues jumped 30%. the better than expected numbers were fueled by strong iphone sales. apple shares rose by as much as 6.7% in

it might be the janet yellen needs to stay on autopilot.whole lot that needs to be done. >> the story of the economy is that there is no story. solid gains, but nothing is so hot that it is causing anyone any problems. >> joe, you cannot admit that on tv. [laughter] >> oh right. the most important jobs report in a long time. [laughter] >> the ecb is no test piloting what it would be like to put together a plan for quantitative easing. what if we started with $500 billion? are they pushing on a string? if they move the german five-year negative, what is pushing bond yields lower? what is that going to achieve? >> i have heard no compelling arguments that this is going to make a big difference. it is very sad. we got the number of 500 billion. it reminded me very much of qe2 come on when the fed preannounced how much it was going to buy. then they said they should have done something more like they did later. the ecb's several years behind where the fed was in terms of using policy. >> way behind the curve. >> we had two big days of gains. th

janet yellen has made it clear she is going to look at wage growth.if we see a pickup, it's nowhere close to the 4% she talked about. i think the fed will probably be the first central bank to raise. all these other central banks will be affected by the strengthening of the dollar but i don't see a rise maybe towards the end of 2015, but not for a while. they will watch wage growth. >> is that a possibility? >> it's certainly possible. i think it's possible that we will not get a fed rate hike until late 2015. maybe we won't get one until 2016. i think they want to raise rates as they would like to get off zero. they would like to exit the many years of extraordinary low rates and look for an opportunity to do so. they will say maybe we are not there on wages but there is clearly momentum in the economy. there is certainly the possibility they will look at inflation numbers and wage numbers and say there is no rush. >> thank you so much. we will be back in two minutes on "in the loop." ♪ >> as we mentioned, mario cuomo has died at the age of 82, a pol

fed chair janet yellen has said that means at least two meetings for rate hikes. not only global uncertainty but declining inflation spurred by lower oil prices and weak overseas growth. there's also no hint of wage inflation. so while some are sticking to their prior calls that the fed will hike this summer, they still believe the fed will move very cautiously once it starts. >> i think it is facing this uncertainty between a healing u.s. economy and a weakening global economy. and let's not forget also the geopolitical factor i still think hike in the summer they'll go very slowly. >> what's clear is the majority of the fed had plan to raise interest rates this year that could still happen. but the data to support a hike stable to rising inflation and rising wages is so far failing to cooperate. for "nightly business report," i'm steve liesman. >> so let's turn now to our two experts for more on the fed, the markets and the economy. john man li, chief equity strategist with wells fargo funds joins us and chief economist at fact and opinion economics. welcome gen

we are awaiting the fomc statement janet yellen and her board. there she is.k at the euro dollar and it was always weaker. then we got the pop. we are up and going a little lower again. it is off of the 2003 high in the dollar index. can the u.s. tolerate a stronger dollar question mark -- dollar question mark -- dollar? the yields are low but higher. -- are a little bit higher. maybe that is a little bit more remarkable. if you want to talk markets you can follow me on twitter. good luck for the rest of your day. ♪ >> apple reports a record profit. shady merchants. and, renegotiating with the eu. greece's new cabinet has to work. the first clash may start with russian sanctions. welcome to "the pulse" live from bloomberg's european headquarters in london. i'm francine lacqua. apples $18 billion profit. the tech giant

janet yellen says that the inflation should move up as employment strengthens.despread as suggested by the statement by the fomc. now, we know that the fed's preferred inflation gauge, personal consumption- expenditures price index has remained below target for 31 straight months. 1.2%. core prices serving of food and energy at 1.4%. take a look at this chart. policymakers are struggling to explain a drop in expectations for future inflation. this is a measure of inflation expectations five years from now. it is called the five-year forward break even inflation rate. look at the bottom right-hand corner of your screen. it is currently at 1.9%, the lowest reading in 14 years. the fed did discussion inflation expectations according to the minutes without any firm conclusionss except that the issue required more time and more analysis. i will let you draw your conclusions from that chart. now, back to the eurozone. >> deflation dangers in the eurozone are a fact now. bank of finland, and when will the bank hiked rates? one man knows who thing or two about the nuanc

quicktime i'm in the janet yellen cap that things the larger -- >> i'm in the janet yellen came thatical movement is that you don't see prices rising to the flack has drawn. we are not there yet. we are close. >> it is time to answer the twitter question of the day. i hope you watched the state of the union last night. what did you think? that is our question. our first answer, there was a certain forcefulness to his tone and speech that was new. he was laying the groundwork for 2016. >> i heard that, too. he is framing what hillary clinton will have to do in two years. >> people say this is what he does best, basically election speech. the second answer of the day president obama -- president obama's stone will be partnership killer for remaining years in office. >> i don't know what you can feel that has not already been killed. that has done killed. >> and a very inspiring one, president obama spoke about hope. let's go to davos. i assume you were not watching the state of the union. i assume you were at the piano bar. what are you excited about coming up today? >> we were at the

does this change janet yellen's thinking for lift off? >> there are a number of factors.g. morgan stanley's housecall is that it is going to between be 16. we think the economy is fine, but the fed will marked on their own forecast a little bit for the year. >> your shop has the outlier call. every day, he looks smarter and smarter and smarter. >> the housecall is definitely later. my sense is that they will wait also. the expectations for earnings of come down sharply. >> nine out of 10 sectors have revised down. >> it is really important. if you are an energy analyst and you did not cut your earnings in earnings season, you are pretty lazy. but nobody has raised estimates in the areas that benefit. i think retail sales will be stronger in january because the oil price is accelerating and they are not perfectly accurate as far as consumer spending. i am optimistic. as far as discretionary spending. >> the stock market will not go down. it is the most hated bull market ever. how do you suggest that this continues? >> there is always going to be corrections. >> know there

-- janet yellen?> if you have global growth coming down, it will be hard to justify hiking rates sooner. >> up next, bill gates predict there will be historic improvement in the lives of the poor. highlights from his exclusive interview with erik schatzker when "bottom line" continues in just a moment. ♪ >> welcome back. this is "bottom line" on bloomberg television. i'm mark crumpton. bill gates changed the world with microsoft and he spent the past 15 years try to change it in a different way with the bill and melinda gates foundation. it has given up more than $30 billion in grants to projects fighting disease and poverty in the developing world. they released their annual report. conditions for the worlds poorest people will increase as improved dramatically over the next fitting is. erik schatzker spoke to mr. gates about the letter. >> there is a lot in the pipeline, whether it's medicines or the way people a bank or get educated. we are seeing that people care about these issues and our ability

what does that mean for janet yellen? >> it is interesting to watch. opposite of the federal reserve. we seem to over telegraph everything we are going to do. you do need to keep a bit of mystery. the fed tells us every single step of the way what they're going to do. there is a danger in that. the markets become over reliant on this communication. increasingly dependent on the fed continuing to be there. >> too much transparency is a bad thing? >> in some ways, it could be. in some ways, we are all for transparency. but maybe you want to keep a little bit of mystery because it keeps the market and investors on edge. they have to value an asset for what that asset is really worth as opposed to the fed being there to support it. >> a great lineup with richard branson. >> i will be speaking with sir richard branson about his latest project helping to create the largest ever satellite network. i will be speaking to the former senator from new hampshire, judd gregg. that is coming up at 3:00. in the former football player -- some interesting hormone therap

. >> what grade would you give janet yellen? >> i think she has done a very good job. think ben bernanke did a spectacular job. i think he reinvented the fed to some extent and deserves credit for doing things during the crisis in pursuing a state of easing. i think janet yellen has done a good job following a lot of what he did. >> david, we will end on that note. >> my pleasure, thank you very much. >> david rubenstein, cofounder and co-ceo of the carlyle group. >> we have a lot more. stay with us. when we return,'s changing the way we speak about the banks. one of the cofounders of paypal. stay with us. you are watching' "market makers " very special doubles addition. ♪ >> welcome back to "market makers." we are live from switzerland. i am erik schatzker. >> and i am stephanie ruhle. we are joined by one of my favorite guest. max levchin cofounded paypal peavy he is with a company built on the premise that the u.s. credit system is broken. he is with us now to talk about the way big banks have it all wrong. max, welcome. we have spoken about this before. you believe

i -- that's not to suggestinging that janet yellen is not following in his path. i think she is.ou need the central bank because when they raise interest rates much like the taper tantrum or suggesting they are going to raise interest rates, it could have a high level of -- she will raise interest rates in july or august i think but it will be very slow. the curve suggests in 2019 february, they will finally reach 2% in terms of the fed funds rate. and i think that's about right. but it will take us three or four years to get there. >> bill, do you think phoenix now and then the 10-year treasury could test the 2012 low yield of 13? >> to me eric, that's a stretch. although and let me just hedge a tiny bit. you know, our treasures are compared to german money and u.k. money on a competitive global basis it's true that the current yield of 176 is this much more attractive than the yield on the german bund. so u.s. rates will be dependant on where the u.k. goes and german -- they are negative so if they get down to 10 years or go negative like it has in switzerland, then our rates g

. >> did janet yellen create a bubble? >> no, she is managing the process. process will stop you have a debt that is in the process of unwinding. the debt is owned by government -- >> we all knew this. all of that is fine, but then if you get an outside or exogenous shot like oil, does that upset janet yellen's presumed applecart? >> what it does is be the catalyst of rate hikes. certainly within the context of a 5% gdp in the third quarter. >> what to did you see yesterday in the equity markets? how would you interpret the weight that we saw as we went negative three something yesterday? >> it was rather orderly, actually. >> i agree. >> people do not know what to do right now the beginning of the year. perhaps the markets ran further than -- >> this is critical. you brilliantly say this is an orderly retreat in the markets. how is that distinctive from a cathartic shark moves -- cathartic shock move? >> a cathartic shock is what we might see in the next couple of weeks in the oil market, really panic setting in there below $50, but for the equity market yo

what's happened with mario draghi is basically -- he's kind of wrestled down janet yellen. charles: you mean, angela merkel? >> no janet. that's why we have europe -- charles: if mario draghi is in control of our fed too? >> yes. that's what is so incredible. matt: no. i don't believe it, but i like it because of the markets. >> the european banks will eat the debt. the european taxpayers owe a great deal of this debt from the ecb and imf. germany and others will take a hard stance on greece. very resolute. they don't want contagion ireland and portugal to say -- italy would be next. i hope greece despite getting office with certain promises will find the middle ground. i hope and expect. charles: when you say the taxpayers, the ecb debt, so does that mean americans own the fed's debt? >> taxpayer -- charles: they didn't park it in a mountain somewhere where it will rot -- >> we taxpayers own our debt just as the europeans own their respective debt. charles: we took the risk, but get none of the return. >> yes. matt: we look at the greece situation, the creditors don't want

the market now focus owes when janet yellen could first raise rates. joining us from america is anthony chan chief economist at jp morgan chase. very good morning to you and happy new year. >> happy new year to you. >> let's talk about that big question. when will we see rates rise and when will that mean for markets? it's important to distinguish what the reason is for the rates going up as its effect on equity markets. >> well i think that's true. it's very important to ask the question why are they raising rates? because the u.s. economy is improving, labor markets getting tighter and it is not because they face high inflation. as you know the whole world is under a sea of disinflation trend. but when they will raise rates is important and i think sometimes along the middle of this year the federal reserve will start raising rates. but even more important than that, i think the pace will be gradual. i don't think it's going to distort or upset financial markets all that much. >> let's look at the performance we've seep. we've got a chart that you se

in the u.s., janet yellen's talking about looking through the treasury effect of low oil prices.e still think the fed will raise rates am a in june maybe september, it is hard to see -- >> it is either tracking a low growth, low inflation story or money pouring into dollars in denominated assets, which one? >> it may be a bit of both because you have that low inflation story and bond yields don't need to go up but also the ecb didn't seem to do qe and the bank of japan has doing it aggressively for more than 12 months. some of that liquidity is undoubtedly finding its way into the u.s. treasure market and that is bringing yields down. >> do you think they will go higher? it won't happen gradually? it could happen just like that. >> there is always a risk that markets get carried away and people are focusing on the deflationary impact of lower oil and people talking more about the positive growth story. >> low-inflation on the back of lower commodities, there is a debate going on right now, the one set of people saying we are flirting with deflation and this is bad in the other si

that is what janet yellen and her colleagues have been looking at. >> anything in the beige book that might move the fed's liftoff date? >> nothing i can see it here that will surprise them or alter their outlook as they continue to watch what is happening with the data and inflation expectations and of course what is happening with wages. the numbers we got this morning on retail sales were a disappointment. the anecdotal evidence suggests something else is happening out there. my guess is they will put more stock in the actual numbers they got this morning. >> what about investor anticipation of what could come? scarlet fu is at the breaking news desk with the fallout in the financial market. >> good afternoon. even before the beige book, we had the selloff in what he as investors anticipate what is to come. remember -- let's show you what's going on here. this is the dow, the hype watermark came at about 10:15 a.m. since then, it has been downhill. supporting losses of at least 1%. for the s&p 500, this is a one-month low. for the dow, 28 out of 30 members lower. the worst performe

there is no janet yellen news conference this month.ead everything we can out of that statement. the latest read on mortgage applications will be released at the top of the last hour.

janet yellen the same thing.oming up, they're going to do their best to make sure we're successful. pushes up financial asset prices, bonds and stocks both. lou: and crude oil $48 after a 5% rally. what are the prospects, and what will be the end result? >> supply and demand from people whoain lot more about it than i do, tell me we may be coming to a bottoming process. we've gone to half where we were several months ago, if we continue to get the slowdown in exploration, we'll have 40 50 for an extended period of time. lou: michael holland, always good to see you. >> are you running for president or not? lou: i'm going set up a committee and explore and my wife will say don't think about it. how about you? >> no my wife said no also. lou: there's that. we would have been good too, you know? >> i'll be vice president. lou: well. tough spot i love that. great to see you my friend. listen to my financial reports three times a day coast-to-coast on the salem radio network. we're coming right back. first forget the g

the cure for cancer, biotechs even janet yellen talked about biotechs, that they may be too fluffy atoint. this was the year for biotechnology. the indexes have gone up and many of those biostocks but people are chasing companies that don't really have earnings. that's the hardest part. gerri: i've heard this story before. i've heard it ends badly. >> and we've seen them crash absolutely. gerri: so radius health osteoporosis sis treatment. book value of 23 million -- >> but there are no earnings. gerri: big zero. >> yeah. negative. so people are buying hope. gerri: tough year for commodities, in particular iced coffee? >> no, no, iced coffee did very well, but most of that was made in the first three months of the year. we took that trade using the exchange-traded fund. the commodity indexes are down over 20%. commodities have been deflating. so every once in a while you'll get a pop -- gerri: iced coffee? >> no, ice exchange which trades the futures contract for -- gerri: i was completely confused by that because i had never heard of a commodity. okay. i think the big takeaway was if

quite since janet yellen has taken helmet at the fed, there has been a push back toward raising interestmoving forward she will use the inflation argument the dollar risk argument, the global growth argument, as an environment where circumstances are indicating that growth is moving forward, but as long as inflation is at 1.3%, 1.4% there really is no reason whatsoever for her to adjust interest rates, and if you look at job growth in the absolute, yes, the three-month moving average is 290,000. the 12-month is 255. that is ok, not blowing it out of the park. odds are increasing that we are going to come to october of 2015, probably have unemployment at 5.2% 5.3%, and rates will still be at zero. >> still a very low participation rate at least historically and we have not seen the wage growth we have been hoping for. >> that is the bugaboo in this report. if you look at the lack of substantive wage growth -- the biggest squawk on the board is talking about sluggish wage growth. >> october is when we get a possible rate hike? >> we are probably going to come to october and be in the same

we have these two indicators which have been extremely well communicated and identified by janet yellen who has done a terrific job in communicating and getting the right anticipations to market operators. i think that is good news in and of itself. the consequences will be a different story. there will be side effects, spillover effects, and volatility. this is unavoidable. in terms of the sheer raising interest it is clearly a good sign. it is clearly an indication that the u.s. is growing, that it is reducing unemployment, and that prices are on the upside. >> gary, you disagree. [laughter] given what we just heard, you think the fed will not raise rates. does that mean we should be worried? >> no, i think the u.s. is growing. that is a non-debatable fact. what i am concerned about is the actual ability of the u.s. to raise rates with what is going on with the rest of the world. when you look at the policy measures going on in europe and what is going to go on, and what you look at what is going on in japan, the interest rate differential already exists. there is enormous spread betw

tonight on the show i'm going to talk to an economic forecaster who said that a forecaster and chair janet yellen cannot raise rates because we're in a world where they understand we're going to have more frequent recessions a with rates as low as they are that's one of the only things in the federal reserve's toolbox to lower rates. what happens if we work ourselves into a recession again? remember it was bad weather and we were in recession what would the feds have done when the feds' toolbox only includes lowering rates. what happens when the rates are really low and the economy doesn't grow there is nothing that you can to goose it. the thinking, the theory is that the fed needs to raise rates now while it can afford to. even though it may be premature just so they have rates to lower if the economy turns bad again. it's a very interesting little bit wonky but it's going to effect your credit card rate, your student loan and what you pay for a house just so the fed can be equipped the next time there is a recession. we have to remember it's been five years to talk about it, five years six yea

janet yellen or tim cook at apple. came out with decent numbers this morning? the federal reserve just released its statement. the buzzword everyone was watching for was patience which just describes the fed's state of mind in determining when to raise interest rates. the word remained, however, the fed suggested economic activity was now solid, which seemed to cause a market sell-off after a big jump initial jump, after investors f

janet yellen will tighten if the market looks better. we saw good data come out today. at the same time she felt us saying, be patient. right now, i think we're discounting the fed. charles: no doubt, this will be sloppy. some people in the market only because of the fed. but if we have a strong economy, and that's the backdrop for investing in the market, that goes back to investing ten, 101. coach up, kate spade up, even michael kors up, do you like them? is this going to help you get back on board. these are convincing -- >> they are lower estimates. coach sales are down in north america. he didn't beat on earnings. they were down 38%. kate spade, i like kate spade, but they're also -- charles: on the bottom line or not on the top line? >> they beat on the bottom line. charles: okay. >> that's a good thing. the problem is, they're still -- their estimates were already low to begin with. they didn't really meet anany of those expectations. when someone says, we're expecting this with coach, they beat on the high end. that's a good sign. this is not a good sign. charle

in the meantime, do not think you feeling terrible will keep janet yellen from pulling the trigger. tumbling oil and gas prices might prompt rates going up sooner than later. to the fox biz all-stars. >> yeah, the market could fall. interest rates going up -- neil: even if it's well-telegraphed. >> yeah. the word on wall street does act like kryptonite. rate hike. the question is when. the fed funds future predicts -- they're saying 80% chance in december. we talked about quarter point rate heights but not in the first half or the second half. so the question now is of timing. because the fed doesn't want to be seen as derailing any recovery. neil: what do you make of what they're saying, that by looking at the potential, i guess inflationary effect right now is going to add a lot of juice to the economy but not pay attention to the other polls that show wages stagnant all the other stuff. >> there are deep structural problems. median income is staggering. it's at 1995 levels. real unemployment, that's a terrible picture as well. 113one third of americans have given up looking for w

this is a pure janet yellen fed from here on out. >> i think it has to find a bottom. start putting my toe in the water on oil stocks. >> i saw a couple of them acting good, whiting in the green, you ask about it every day, we're getting hammered on it. fantastic show, thanks a lot. meet you in aspen. catch us here, 6:00 p.m. if you can't see the show, dvr it. you don't want to miss a moment of "making money." 9:00 a.m. i'm hosting opening bell, lot to talk about, i'll go through the data we talked about. leave you in the ever capable hands of the man himself, lou dobbs. this is fox business. lou: good evening, everybody. the republican controlled 114th congress and u.s. senate sworn into service today. president obama didn't even wait for results of the speaker's election to start issuing veto threats, a bipartisan senate bill to authorize the construction of the keystone pipeline has enough cosponsors to break a filibuster and has the support of nearly 70% of the american public. but the white house not budging and acting quickly. press secretary josh earnest confirm