for more reaction, i'm joined from stamford, connecticut, by michelle girard, chief u.s.conomist at rbs securities. >> thank you for having me. >> chairman yellen said the recession officially ended five years ago, but the u.s. economy needs stimulus because unemployment and inflation are well short of the fed's goals. is this what investors wanted to hear? >> they wanted to make sure nothing has changed from the message the fed has been sending. employmentrong number, and a weak gdp number. most people think it will be revised into negative territory, and the question is has anything changed since the meeting given the new data, and the only thing that is clear is that the fed is sending the same signals and the views have not changed. it is hard to thread a needle between suggesting the economy is strong enough to warrant the tapering of qe, and at the same time not have anyone worry that the fed might be thinking about hiking rates. >> the chairman noted the data showed solid growth, and that supports the case for faster expansion this year. do you see that as well, wi

joining us now, michelle girard and zach karabell, president at twice river research. thank you both for joining us this morning. this week, we thought janet yellin testifying before the house and senate and she basically said the economy is improving, but it still needs help. do you agree with her comments and were either of you surprised by market reaction? zach? >> her comments are consistent with what they have been all along and what her predecess predecessor's, ben bernanke, have been. the only thing, changes in grammar and a comma going in one place and the other. i think that speaks to fragile market psychological, looking around a little bit deer in the headlights, post-traumatic stress syndrome from the 2008, 2009 crisis. the fed has said they're going to have a loose, accommodative, easy, supportive policy. maybe not as much as it has been in the form of the bond buying, but other than that, that's what they've been saying. that's what she keeps saying and the market seems to have a hard time fully digesting that. >> we did see the markets enjoying what she

joining us now is michelle girard, chief economist at rbs and author of the new book, the leading indicators. zack, michelle, thank you both for join us this morning. this week we saw janet yellen testifying before the house and senate and she basically said the economy is improving, but it still needs help. the markets seemed to like what she said and do you agree with the comments and were either of you surprised by the market reaction? zack, why don't we start out with you? >> her comments were consistently with what her comments have been all along and ben bernanke's comments. the only thing that hasn't been consistent is the way the mar t markets have reacted to the changes in grammar and a comma going to fr one to the other and it speaks to a fragile economy which is looking at a rather a little bit like deer in headlights from the 2008 and 2009 crisis. nothing is particularly surprising. the fed has said they will have an extremely loose, accommodative, easy, supportive policy and not quite as much as it has been in the form of the bond buying they've been doing, but either than that,

. >> i assume people know that you're michelle girard, chief economist at rbs. there may be some people who think you're michelle -- >> here we go. >> you came on when you were 6 the first time. >> i appreciate that. i appreciate that. >> we can do -- would you -- are you predicting a forehandle on one of these quarters. >> we actually are probably looking the aa better than 3% second quarter number although the first quarter, we might get the first quarter number revised into negative territory. >> not up. >> no. >> again, what we all -- the only thing we know so far yesterday, construction data was out. it was a lot weaker than assumed. that would put us down slightly. we'll see how the trade numbers look next week. the thing is even if you get four and you average this week, you're still looking at a 2% growth pace. even if we get four, how meaningful necessarily is that. i'm still not convinced the underlying trend has changed a whole lot from 2, 2.5%. >> i would think 215, even if i buy, the gdp number is more of a lagging indicator than employment numbers.

joining us now from chicago is lou breen, and onset with us is michelle girard.ou, we are sitting at new highs for the s&p, for the dow. you're looking at the levels, what makes you nervous about this, though? >> the one thing, like you say, we are just a couple percent off the high for the s&p. the thing that makes me a little nervous on this is that the nasdaq and various biotech and things have ramped up a lot and have come off 8% to 10% reminiscent of what happened in 2000, except it was the other way. the dow peaked in january of 2000 and fell about 18% to 20% while the nasdaq went up a final 25% in just two months. also, i think as we -- sorry, as we discussed before, the five-year anniversary of this rally. and over the last three-and-a-half decades, five years has been a limit for rallies, so i'm keeping an eye on that as well. >> when did you start getting nervous, lou? >> i'm always nervous. additionally, things, other market things that may be indicating a little bit of trouble is the ten-year note at 2.5%. and the yen at a recent low around 101.20 thi