as the fed meets today to consider u.s. , greece is certainly one of the things they are considering in assessing the economic outlook. if the greeks don't make a deal they're likely going to default on 1.5 billion payment on the 30th. the bailout program expires that day which pushes the crisis to a whole, new level. either one of the factors could push the ecb to stop supporting the greek banks. reuters reports that its wednesday meeting the ecb did agree to support banks to 1.1 billion euros. anonymous reports suggest 400 million euros per day have been withdrawn by greek depositors over last several days as people grow increasingly nervous about what could happen if there's no deal. >> thank you, michelle. feels like neither side wants to blink first. >>> anticipation of a rate hike some time this year continues to push up banking stocks. bob pisani live at the new york stock exchange with that story. lay it all out for us. >> bank stocks have been strong. buy bank stocks when rates go up it generally helps them. you can

we know we'll be fighting the feds. al when we do it and bonds will be sold. those can be very very dangerous -- maybe then we should just cover the topic that i know many of you may be thinking given that fighting the fed can be very difficult, real tough job, even though a better economy will produce better profits. so this is something i never talk about. let's cover short selling. now, i never recommend a short sell. i may not like the company, but i won't bet against it. i can't use puts. but you know what? when i was at the hedge fund where karen cramer was, yes, the shortage got us. it was her strength she loved the short side and hated the long side. here is what i will do a long long time ago she wrote short-selling rules to live by. i dug them up and will give them to you. not much commentary just straight out. they are timeless even if some of the examples now seem a tad quaint. rule number one has a bit of dust on it. she called it the business week cover rule. at the time, they jumped to move stocks always o

she is not saying the fed should never raise rates. there is a solid argument there are no signs of real inflation. she is saying a lot of people think the first rate hike will be in september so why not wait a few extra months? i think debate -- i think you could debate but it is not like a radically different proposal. stephanie: policymakers are praying that growth is going to get us out of this whole. as we get more data, it does not look like data will get us out of it, it looks like they're getting panicky. carl: these are explicit instructions and i think it is unhelpful because it is trying to paint the fed into a corner. the fed's mandate is to steer the u.s. economy and do what is best in the interest of growth, full employment and price stability to be potentially sacrificing what is best for the u.s. economy is not the fed's mandate. erik: stan fisher the fed should take that into consideration. take these issues into consideration but their mandate from congress is full employment and price stability. this appropriate? carl

the size of the fed balance sheet is important. since lehman brothers went bust the balance sheet increased 3.6 trillion. i am assuming they will hold their balance sheet to current levels. if they start to reduce the size of the balance sheet, that is something we have to watch carefully, that would be negative for markets. the statement from the fed underpins markets for the moment. i think it is interesting, coming back to the swiss bank, a number of the external stress points are either swiss bank or gold are not moving that much. guy: we will talk more about the rate trajectory. merkel is still speaking in berlin. hands -- hans was talking about the greek communication with the german people this morning. this is her putting the german point of view clearly across she is talking about russia right now. we will get back to that. coming up, carry on -- we will carry on the conversation about the fed. we will speak to randy kroszner and get his sense of where yellen is going to take us. we will talk about these with national bank

that was in the market before the fed. stay with the market. >> if you look at the u.s. dollar weakening significantly on the back of that. is that consistent? >> well i don't think rates did anything of note today. and i would suggest to you that the dollar is range trading. nothing going on with the dollar. at this point in time more focused on tomorrow and europe and greece than it is the fed. there was nothing in the fed today that has significantly changed the dollar or the bond trajectory yet. >> well certainly a reaction. almost 1% move in the u.s. dollar. a little bit surprised on the dove-ish side. she said that we have to see more decisive evidence was the quotation that there's progress on the labor market on wages and the slack in the economy like long-term unemployment and more progress on inflation. also mentioned international concerns and there's potential for there to be disruption from grease if there's no deal reached. she didn't overplay it but did say you could see spillover from the economic effects t

and the fed says, we don't really know. unk in or is the market still looking for hidden clues? guest: market will be looking for those hidden clues but they are really the fed interpretation of economic data. the dot plot i don't think we'll move that much today but one of the things that will change is the 2015 gdp forecast. the fed is saying to hit 2.5% given the lousy economy, we have to go 3.5% in each of the next three quarters. tom: what is important is that you have not had the dreaded s word. slack. here is a great chart of slack in the economy. in the old days people got jobs quickly when they were unemployed. boy has that changed. economic blather around the reality that half of america is flat on its back. guest: it we are not seeing significant wage inflation yet it is still above the neutral rate. you keep your foot on the gas pedal. that is in the dot plot with a late start and a slow trajectory. we are going to be slower in this cycle then passed cycles. there are two critical keys. number one, all the econom

perhaps on the perception the fed will tell us today. ber rate rises in the works the yield at 2.38%. taking a look at the dollar, not seeing much action in the dollar. an interesting column out today that tries to handicap the winners and losers when rates do eventually go up. the dollar is listed as one of the potential winners. i wanted to get a check on oil prices today. one of the few aspect -- asset classes that is not moving in direct reaction. we are seeing it down 1.5%. we got the inventories report aday that so -- showed drawdown in inventories. refiners were refining at a lower rate. does that mean we won't continue to see that drawdown? does it indicate a bit of weakening of demand? that appears to be the conclusion that traders are drawing today. we are seeing oil prices selloff. mark: julie hyman, thank you so much. look at today's market close in europe. no signs of compromise in greece. the very opposite, in fact. the stock exchange down 3% at the moment. it has dropped as much as 9% over the past two days. we've had all s

the fed has advised the bank of japan. they are always telling smaller countries what to do with their economies. we should get over it. they listen though? does janet yellen say, yeah, let's talk about this? that yellent think is going to consider what christine lagarde has said it all. i do not think it will have any impact on policy, but i did not find it that ridiculous. we did wind up seeing a reaction in the bond market. year yields were up 1%. we had the 10 year up at its highest level since october and it kind of reversed. we came up from that. the yield continuing to grind lower here. there is more money into the safety from inflation space. joe: we have that crazy today move in then it faded a little bit. -- when i first saw this, i was really stunned. then i pushed over to the other side. the other point is the argument from the pew were data perspective. for the fed to tighten too soon and that if they're going to be data dependent, wait a few more months. but they are kind of right. the fed has missed its infl

the fed has to break the cycle and raise interest rates.e have a redistributionist monetary policy going on to complement the fiscal policy, keep interest rates low for the borrowers, yes, it hurts the wealthy americans with money to lend. everything i've seen out of the entire administration for seven years says it's going to be a one-way ticket downward on interest rates. there's no increase in interest rates. i find it very hard to believe we're going to get an increase in interest rates out of this group. liz: and you know what? warren buffett said the same thing, not going to happen this year. michael, i like what you said, we may not see one until after the election, 16, 17 months from now. we'll keep the conversation going. thank you for joining us. michael cox. >>> what happens to the markets? now suddenly heading closer to the flat line and what happens to your money when we see the teeny tiny rate tightening. we're joined by kevin and mark matson ceo of matson money. mark, to you first, if she hasn't telegraphed we're going to see

is well aware of that area as we go into the fed meeting, june is theoretically in play but the fed is not going to pull the trigger, especially not ahead of the greek resolution in europe. what the fed does is the tinker with their economic effect -- assessment. they moved in a negative direction last meeting. this time they will backtrack that somewhat. they will need to adjust their growth forecast for the year. currently they are looking for 2.5 percent gdp growth area that requires the economy to grow 3.5% per quarter in the current quarter and following two quarters later this year. that does not seem feasible given what we are seeing in the data. they will have to scale that down. see howam excited to the adjust inflation. we're looking at the cpi versus tce. what do you think the fed will wind up saying about inflation? they keep saying it is transitory but the pce continues to be way down. this economy is strong enough and the potential growth is lower because you have got less labor supply and less productivity growth. you do not need 180,000 jobs per month to keep the une

it takes a while for people to digest what the fed has said. we have the press conference coming in 25 minutes now. you will continue to see volatility. and takert with rates a look at what's going on with the 10 year note. trending lower. still higher on the day, but taking a leg lower after the fomc statement coming out. note trading0-year with the yield of 2.36%. coming off its highs of the day. it was rising substantially. we have to take a look at what's going on with the u.s. dollar here. one of the assets that could benefit as rates start to go up. lower.seeing the euro go -- the dollar index going lower as well. interesting reaction there. we can take a quick check on oil. we have seen oil prices trending lower all day long. they took a bit of a leg up when the statement came out. still, lower on the session. reaction as weet continue to have people offer statements. parsing of the statement and looking ahead at this news conference. we're back with more reaction to today's fed decision. lisa, let me start with you. julie just used the f

alix: and the elephant in the room, the fed. e seen the balance sheet we saw and at one point, it almost hit $2000, so what happens when the rate cycle begins? >> a lot will depend on currency, we have the view that the market may be in its final phase, according to foreign exchange research. if you look at historical data, in the last four cycles, when the fed gets around to increasing rate, the dollar tends to pull back. if that happens again, but if it does happen again, it is likely to support gold. at least in the gold market, like every other market, the fed hike, when it does come, has been placed in the market, so i don't expect it will be a great blow. alix: real rates are still negative, so when that happens, coal is still an investment. >> that is a good point. it is a by no means just a u.s. centric game. alix: what is fascinating is have -- u.s. point buyers dropped off the face of the earth. long does that last, what changes that? >> there is a level of price sensitivity, even in one market. the claim market is rese

the fed keeps talking about raising rates. t has not believed the fed is going to raise rates. something lisa and i have talked about. the imf said do not raise rates until the middle of 16 -- the middle 2016. the market was thinking that anyway. it is not that it is shocking news. it is shocking who said it. stephanie: publicly. erik: this is a statement by the imf. i wanted to share with you more of what has come out of this. the imf says u.s. public finances are on an unsustainable path. the fed should wait for tangible signs of wage and price inflation before acting. the imf has cut its 2015 forecast for the u.s. economy and furthermore, the imf says there are potentially serious risks to financial stability in the fed great height going back to the point -- the fed right hike. what you make of that? jim: i think the first half is boilerplate. financial stability. that could be the only reason they want to have the fed stay still especially an organization like the imf. street thinking is they are not very good at predictin

so the fed is focused on the united staeconomy, period full stop. and there are times and this may be one of them where it would be better for the whole world econ wouldn't raise interest rates so early or even so quickly. but that is not going to move the fed. the fed is focused on the u.s. >> all right. professoblinder, always great to see you. thank you fo welcome. >>> and now an issue the markets are watching closely. greece. the deadline to reach agreement with creditors is fast approachin and today greece's finance minister said a deal was unlikely to be reached as the euro group meeting scheduled for tomorrow. meanwhile in athens protesters to the streets for the government and against changers. >>> fed ex reported disappoint fourt quarter results today,su coming in below wall street estimates. and disappointing current qu guidance. despite the muted growth outlook, the company does plan to increase capital spending by 7% to keep up with rising demand for online shopping. shares dropped today about 3%. >> tie a record fine for at&t. 100 milli

the data remains very fluid. this speaks to market volatility. fedicials have been going out of their way to tell the markets, stop obsessing about the date of the first rate hike. this will be the loosest tightening in history. comments,with the imf the question of the date is back front and center and that imparts additional volatility to financial markets. mm: what do you believe the effect would have been if christine lagarde had not come out with the specific date? >> i would have expected the imf to say something along the line that the fed should because this about the timing of its first rate hike because the u.s. economy remains fragile. there is no inflation on the horizon and the international situation is far from stable. by going much further and specifying a date, you saw the movement. the 10 year in the united states moved 17 basis points in an hour this morning. that is a huge move for a benchmark that determines pricing and so many other markets. alix: most believe the fed will raise rates in september. watching on this volatile day.

speaking of the fed, it's useful to look at what's happened since the last fed presser. ear yields are generally up. u.s. stock market small moves up in the s&p but not good. german stock markets peaked out the second week in march. the real big rally has been in crude. crude bottomed in the middle of march and has staged a spectacular rally. low 40s into the below 60 range. there's the big move up although it hasn't resulted in a big move up in emergency stocks. what's going on with the fed? they're data dependent. let's look at the data. misses recently? industrial production, housing starts consumer spending missed but there have been some beets. nonfarm payrolls. ism manufacturing, retail sales were inline. and building permits also had a nice beat yesterday offsetting the slightly weaker numbers on housing starts. it's a bit of a wash for them. i think the fed has three problems. greece is a major problem for them. very interesting to see what they have to say about that and if they will acknowledge whether a resolution of the greek issue would make it easier to rais

it seems the fed has waited a very long time. the markets probably get hit a little bit with the way -- with the rate hikes, but if we cannot face a small increase, we all have big problems. betty: christine lagarde just set the world on a bigger -- we are already watching the fed, watching them even more. i hear what you're saying, mike, that likely they will still go in september. it does not really change very much. but she just made it a whole lot harder for janet yellen. didn't she? mike: i don't think so. when you think about what the fed cares about, the fed will give lip service to international the developments. it but that phrase in the statement of publishers ago, but it does not -- the fed cares about the financial markets. if something goes badly overseas, the fed will pay attention. it did in 1998. 2008 you could argue was a huge global meltdown. the fed is u.s. focused front and center. by the imf picking up, it did not make it that much more difficult for the fed. at, why isle look the imf talking about the u.s. no

the fed playing cautious on the u.s. economy. s are saying one interest rate will be enough this year. they are advocating aglow slow -- a go slow policy. yellen notes wage growth is subdued and says there is weakness in the labor market. fitbit begins trading this morning on the new york stock exchange. pircrices its shares above the market range yesterday. it raised $7432 million at the ipo. jpmorgan vice chairman jimmy lee is being remembered this morning as a rainmaker who put together some of wall street's biggest deals. lee died yesterday morning and is connecticut home. he pioneered the use of leverage loans to fund takeovers. lee advised on such deals as comcast and nbc and gm's ipo. jamie dimon said simply he was an incomparable force of nature. jimmy lee dead at 62. brendan: it is been extraordinary to look at the anecdotes people have been offering up. i went back and looked at the first time he was mentioned in american banker in 1997. there were some canadian banks trying to put together a hockey game and they said no

should the fed delay the cycle?it start in september, or should it wait because of the greek crisis? some americans are worried about this. the u.s. treasury secretary phoning alexis the press warning he needs to get serious about some of the reforms. -- alexis tsipras. we have a number of speakers in the spotlight. the ecb will meet to talk about emergency liquidity assistance. will the greek banks continue to make the grade to be allowed to have that emergency assistance? we get that decision from the federal reserve followed by a press conference from janet yellen. and then madame lagarde will speak later. this a day after tsipras said the emf bears critical responsibility for the situation. a big day, and that paves the way for the meeting we have tomorrow and luxembourg. tomorrow he will put that in perspective. let's begin with the greek story. the pensions are -- tensions are rising as the deadline to find a solution to the debt crisis rises. our international correspondent joins us from berlin. how has it ts

she being the fed chair with respect to the office obviously. you think that she, janet yellen lays the ground work for a fed rate hike later this year? >> i think that potentially she's more dovish than we expect her to be. which would not be consistent with the strategy that you're asking me for. i don't -- >> you think she's going to be more dove snish. >> she might be. >> she might be concerned. she might be concerned about what's going on with greece. but i think the reality of what the next six to nine months are going to present for the markets is going to have to have the federal reserve move on rates. i want folks to be prepared for that i don't think the market believes her any more. i think they have to move. when you look at the labor markets and the modest uptick in inflation, think the federal reserve is going to move at the end of the year and i think rates are going to reflect that. >> pete? >> depending on the economy. i think you'll hear a lot less about greece and you'll hear more about the economy the first quarter. >> you kn

carl: the fed is sensitive to the dot plot. erik: kelly bring a block of again -- back up again? k at what it shows fed policymakers inc. that over time, we are going to get back to some of the 4% environment. bill gross makes the case that there is a new neutral. that the most we will get or the average we will get up to in the long run is to 75. carl: it tells of the rate is about drifting a little lower at 350 is said 375. out of the cable fall further below that because we are seeing firming affirming in the economy but certainly, dot plot is not in line with his pimco. richard cohen part of the reason is people listen to bill gross as much as they do is for the part that you are making before. erik: hasn't the fed, in a sense , because it is not following economic fundamentals outsource some of the judgment in the financial markets? richard: who are they conducting monetary policy for anyway if not at least to that channel for the financial market? erik: they are sensitive because of the dramatic tightening of financial does heavy lifting. olivia: by the going to downgrade u.

a war and come you are focused on the fed. lauren: absolutely, sandra appeared how many hikes will receive this year? train to nicole, you are looking at the battle with the fed. nicole: metlife taking on the government about its designation too big to fail. maria bartiromo will cover that. sandra: first is an breaking news. major floods in texas as the remnants of tropical storm bill move across the state. is it expect it the same region that was hit by the deadly floods during memorial day weekend. some parts of the state could see up to 12 inches of rain. forecasters say the system will generate intense rain and eastern half of texas and oklahoma, missouri as well as arkansas in coming days. the golden state warriors are nba champs. they clinched the title, beating cleveland cavaliers 10521097 -- 197. andrÉ was named series mvp. he and beth curry had 25 points each and defeated lebron james for 32 points for the cavs. federal reserve policy makers wrapping up their two-day meeting today. lauren has three things to watch. lau

the fed seems to focus on potential negatives. i would like to talk about whether you envision on intended benefits of higher rates. one of the things i am thinking about is that savers have suffered many years of miserly returns and maybe absolutely anticipating a positive way a better return on their investment. thank you. chair yellen: celeb he say to my mind the most important positives -- so, let me say to my mind that the most important positives to the decision to raise rates was signify very clearly that the u.s. economy has made great progress, and recovering from the trauma of , i thinkcial crisis overly doubt be something that in many be confident households and businesses. from the point of view of the savers, of course this has been a very difficult period. mainly retirees -- and i hear from some almost every day -- are really suffering from low rates that they had anticipated would holster their retirement income. obviously, has been one of the adverse consequences of a period of low rates. we have a good reason for h

actually dipt going into the fed statement. , we had gotten the latest gdp were bit -- revision which had shown the weakness in the first quarter. what about the meeting before that? that was sort of, let's take a look here. this was more a classic fed day where you really see no activity . and then the big movement once the fed statement comes out, this was march 18. at that time, it says the data does not suggest a lot of growth in that growth in fact had moderated. then people pushed expectations be for when the fed would raising rates. we saw a big surge in stocks and -- higher.or 2% hot now it's look and see where it is trading today. we do not have a lot of action, though it is pushing higher going into the press conference, 2.37% is where we are now. the dollar as well. we heard earlier from joe of bloomberg news. he and lisa writing a winners and losers column going into the fed statement. the dollar could be one of the winners. it is little changed right now, saying that when rates go up, the dollar could -- continue to

one is the job situation, the economy, the fed, all that stuff. e other one, today's opec meeting in what is going on with oil, and greece. with us we have chad morgan lander, portfolio manager, and green to be-- eric securities.- of tb guest: great to see you. alix: you did not nail it. but yesterdayot, we had christine lagarde saying the data says we should wait until text -- 2016. today's data point undermined that. what do you think? >> but i think of jobs and when the fed is going to raise rates, i don't look at rates or inflation. inflation is moving as we expected, moving higher. jobs, 175,000 to 225,000 is to get the fed off zero. to me it is the consumer spending, durable goods orders to see is more of a lift off going to the third quarter. it is happening. confidence that jobs can be around that level is rising. alix: what might have been perceived as more negative was the temporary workers. fromy increase to 20,000 16,000. they are relatively high. i wonder if that is a choice, people want to work part-time, or if it is because companies

so the fed had to be the grown up in the room. whether the wealth is spread out democratically, level less than v half own stocks, less than half own homes. it's not 95% of americans have jobs, it is really in the 60s of the people who can or should be actually working. but even that job creation, that lower of unemployment you're talk about, what we're seeing in the last few years is remarkable wage stagnation. so we haven't created wealth or prosperity for the least among us. >> no, that's right. i mean the recovery is still far from complete. and you see that in the wage numbers you just referenced. i mean sort of nominal wage growth not even adjusted for inflation is running just over 2%, been that way for the past two years, not a lot of pickup i'm firmly convinced it would have been worse had the fed not have done what it did. the monetary response to the crisis aftermath is it's just kind of uncertain about how much of an effect it had and it's a pretty uncertain tool so again it is not the optimal response. i would have ha

the fed remains data dependent. it appears to be increasingly comfortable that a notion of a modest increase. wasn't that always the plan? projections as low as five basis points. clearly, the market expects the fed to remain fairly tame. >> it was about the dot plot yesterday. there were not any big surprises. the market really focused on where so many of those dots came down. a lot of us were surprised or interested to see that the fed held so firm to its view that is likely to be to rate hikes this year. matt: a good-looking dot plot. i like the forward years. the fed itself will say it doesn't have much faith in such forward guidance. olivia: it looks like battleship. it's in the trajectory of rate rises. more gradual than we previously thought. one thing i want to ask you about -- matt: it's amazing how much janet yellen precipitates this by saying exactly what we are extrapolating now every single time she speaks. josh: a candidate for getting onto the $10 bill. she is in charge here. olivia: it has to be a wom

wage growth is in los angeles, is that really going to make the fed feel better? lisa: the bond market actually agrees with joe. you have spawned levels rising to the highest levels since september, the 10 year highest since october and you saw a real soft this in the credit market. people are getting nervous and people are saying this could be the real thing. this could be the time the fed looks at this data and yes, your point does get enough comfort that they can start their hiking process which will be problematic, particularly for credit and emerging markets which have been hammered recently. these are some of the dynamics for the market. it was bad for the bond market. michael: it seems like even a few weeks ago they were saying it's going to be a while before the rate hike. how do youseptember, see the fed hiking rates -- when do you see the fed hiking rates? michael: my answer is not this year. i'm still a skeptic on wages. one issue with wages, and i think this is a global did wages, how much really come down during the recession? did they really come down

the fed has been saying the same thing for a year now. we are going to go slowly, gradually, rates are going to be low. in my view that baseline scenario may come under pressure next year. in which case, the stock market is going to come under pressure. vonnie: the pricing of the else would help the fed. u.s. equities are not moving on the greece tsipras-- news. neil: at the end of the day it comes down to corporate earnings and productivity. and u.s. productivity has been very weak. at the same time, wages are rising. so there is a risk that compensation growth translates a bit more quickly into higher selling prices, and that is not a good scenario. tom: oliver chen will be with us. on gap and j. crew. i want to talk about the nerd moment which is we are not consuming what we used to and we are saving. the marginal propensity to consume has gone down. tutti by -- do you buy the idea that americans are going to save more? nieil: i do not think the rhetoric that is put out there is accurate. it is amusing, actually, with home sales hittin

stocks as the fed has press conference. s over greek capital controls mount with the central bank issuing a warning over a grexit plus a field of thieves. the fbi investigates allegations of hacking in major league baseball. >> vladimir putin announced plans to put more than 40 new mistels into service this year. it will aim at territories where threats come from. the move drew sharp criticism from nato. they amount to nuclear rattling and was unjustified and dangerous. >> once russia's biggest private oil company was last year legally seized from its corporate owner and standed back to the state. a court also placed the chairman under house arrest as part of a money laundering probe. the rulings were seen by many as representative of the rix of investing in the company. jeff caught up with the ceo for an exclusive interview and asked how painful the experience was for his company. >> things like that happen in any country and any economy. those situations arise and you have to deal with them. i think one of the important fa

and the fed wants higher inflation. ave wages that are at the moment higher than inflation, so you have real income for middle income people. if we were at the fed rate of 2% they would have negative real income. so why is that good? >> but what is it that you think the fed should be doing? they should have raised interest rates before? >> at least they should be doing it now. a quarter percent will make no difference other than saying, okay, we're on our way now the market will anticipate that and get closer to the rate. but the feds should not be buying anymore securities at all. they should let maturities occur, pay downs should you know, be there. and they should reduce their -- they shouldn't grow their portfolio at and you would. >> what do you make of christine lagarde yesterday trying to tell the united states to not raise interest rates? >> well, europe has issues. >> but we're the united states. >> but she's french so -- >> so you would disagree i'm assuming. >> yes. >> what are the prospects for commercial ban

coming up, the feds in focus. reaction to janet yellen's comments with our next guest who seems best season signs of a turnaround. you are watching "first of. up." ♪ angie: checking headlines around the world. tempers have flared in hong kong as rival groups and protesters faced off outside the territories where pro-democracy lawmakers said they would reject the china backed election plan. on vote is expected later thursday. after six hours of debate wednesday, none of the legislative council pro-democracy members say they would support the plan. the bill would allow a citywide election for the next chief executive in 2017 from a list of candidates approved by beijing. continuing and parts of southern china following record rainfall last weekend. swollen rivers have why still he and caused landslides. heavy rain also caused flash flooding in shanghai, prompting a social media storm about the poor drainage system. final testing is underway on high-speed rail. the $7 billion line runs from a city in the north from --

when i listen to yellen i think the feds took her seriously. plenty of people who come on and don't care about the direction of the stock market or want stocks to go lower because they're short. i part ways with these wind bags because, i think it would have bhn totally irresponsible for feds to act without waiting to see what happens with greece. where does it all leave us? couple places. first we're done worried about what the feds will do for the rest of the summer. we will hear from individual feds as the summer go on and that will be negative. if greece solves without disaster plenty of fed heads. business as usual. fact is though we really don't know how strong our economy is, despite what you hear. we do know that it will be a lot less strong if europe is isthrown back in the recession. if you asked what is the second most important about the economy it is that fed ex told you things are not so hot. holy cow they have as good handle on commerce has the fed does. not reassuring. third statement, very week results from oracle. you don't get

that is a problem for the fed. ve, no one will care with the inflation rate is. people will just assume inflation will happen. the fed may be in this situation where inflation is low and it may accelerate rapidly and they not worried about what the imf says. tom: breaking news right now and let us go to that. this is with indiana. vonnie: opec is keeping production unchanged. saudi is saying that opec decided to keep the target unchanged. oil prices are trading at $61.99. pretty exciting. it sounds like opec doesn't really have any power anyways. tom: using that several few. what is the difference? vonnie: is the cartel over? can we use that word anymore? richard: the cartel was saudi. they shocked us around thanksgiving saying that we would not cut back production. the cartel is saudi arabia in 11 other folks around the country. tom: i have to jump in. brendan: the saudi oil minister says that it was opec's most amicable meeting. eating doughnuts and jerking copies drinking coffee. the situation is not changing for

lisa: it's not just the fed. we're talking about inflation data with economic growth improving their. when you have a strengthening dollar, that means a weakening of currencies and other places. do they have to sell their reserves to potentially bolster their currency and what does that mean for u.s. assets because a lot of their reserves have been held in u.s. assets. could this add to the weakness in credit markets in general? this is a big concern because once you get a real shift, people are concerned money is going to start flying around and it could be violent really quick. joe: one of the things that was brought up is this rising correlation between bonds and equities, so there's no place to hedge. what are people on the street doing about it? lisa: more cash allocations, people are looking for corners of markets that are not as correlated, but it is a tricky science. this is why you see record flows into unconstrained funds. the question is whether they are really uncorrelated or not. alix: stick with me.

moving back towards the fed's 2% level. going to be hit next year according to this panel. 2.3% is the estimate for next year. that's up 0.3% from the april survey. remember, the cpi runs hotter. what we see is that most of our panelists, median forecast is for a september rate hike. some like you just heard are forecasting a later hike. >> exactly. let's dig into this more. thank you, steve liesman. with regard to what yellen and the fed do tomorrow joining us is ted peters chairman and ceo of bluestone financial institutions, a former member of the board of the philly fed. and ethan harris who spent nine years at the fed, wrote a book on bernanke. ted, let me begin with you. what is your expectation for tomorrow and when that first, key first rate hike happens? >> i'm projecting we are going to see an increase in september. we are going to see an increase in december. they are going to come out and pave the way for that. one thing janet yellen does not want is a big surprise. that won't spook the markets. i think we'll pro

this is really the issue, especially if the fed hikes and it slows the economy down. what will that do to these companies relying on a pretty steady acceleration of u.s. growth? joe: all right, one of the most amazing market moves of the week has to have been what we saw in china. the chinese stock market has had an incredible run this year and the last two days absolutely getting clobbered, including last night. 7% down. scott, are your clients interested in china and what do you make of this seesaw market? scott: retail investors are underinvested internationally and that is probably what you mentioned happened with the chinese market. for me, emerging markets, they are going to be volatile. that is what is going to happen. those markets are developing markets. they do not have much liquidity. you need to have a long-term view, and i am not talking 2, 3, 4 years. you need to be looking out five, 10 plus. you need to close your eyes and let it ride. you might adjust it a little bit on the way. emerging markets will be very volatile. if that scares you, you probably s

the fed has some confidence. they are not always right. but i think things are getting better. i think the cyclical market has more room to run. as we have done the last 40 years with our clients, when we see market pullbacks, we want them stepping in to buy stocks. areil investors underinvested. they need to take advantage of downside volatility. concern isnk the big becoming credit risk. that these companies that maybe should not have existed, should not be able to finance themselves a all of this money cheap levels.-- this is really the issue, especially if the fed hikes and it slows the economy down. what will that do to these companies relying on a pretty steady acceleration of u.s. growth? right, one of the most amazing market lives of the week has to have been what we saw in china. market has hadck an incredible run this year and the last two days absolutely getting clobbered, including last night. 7% down. scott, are your clients interested in china and what do you make of this seesaw market? investors are underinvested internationally and that is probably what you menti

even when the fed raises them, they will remain low on the historical standard. estimation and my colleagues at wharton, a lower discount rate means a higher average valuation for the stock market, so i certainly don't believe that this is overvalued at current levels. >> that is a key point, at what or where do you think the funds will peak once the federal reserve is at the apex of the tightening cycle? >> my belief is, and here, one of the rare times i agree with the bill gross, we haven't disagreed over the last 5-6 years, but he named the new neutral fed funds rate at 2%, and my own populations confirmed that. that the average fund rate over the next decade will remain at 2%. it does not mean that at the peak of tightening it will not be above 2%, it could get to 3-4%. but then it will be brought down below 2%. that is when the economy softens. we will have a lower average level of interest rates, certainly the fed rates could peak above 2%. but it will not be the 4% that we know the fed has in its dock, that it puts out every quarter in protection. >> in te

the fed needs the opportunity to build credibility.he conversation was free well exposed in that timeframe. where you will end up between here and the end of the year is that they will have to put in place not just for his, but actions. a rate hike is likely in september. but the reality is that it is still data dependent. joe: the state of the economy right now, we've had a pretty strong jobs pick up. janet yellen mentioned we had a rebound. the call from earlier this we're thehis year was that transitory was pretty indicated. where do you see growth moving? 2.5% inher: it -- carl: the current quarter. to hit the fed target we have to be about 3% growth in the next two quarters, q3 and q4. i'm not sure we can get all the way to 3%. it's a tall order. alix: i will have to leave it there. we will be right back. ♪ alix: welcome back. i'm alix steel. we want to get back to some big news today for wall street. jpmorgan vice chairman jimmy lee has unexpectedly died. morning at 62 years old. reportedly he had some shortness of breath while e

. >> what the investors care about is the fed and when the central bank may move on rates. today the head of the monetary fund said not so fast. lagarde said she wants to delay raising the rates until next year. and she's not alone. others express concerns about moving too soon. steve liesman has more. >> the i monetar fund not mincing words asking the hold of raising interest rate rates until 2016. saying they should raise until rates and inflation starts to rise. >> a suggestion that a interest raten wait a little and such interest rate hike can wait until 2016. forward governor hail brainerd said the economic weakness may not be all temporary. and issued caution in rate hikes. he is uncertain about whether the we tempora but there are more questions about the economy now than this time ted is looking at two criteria. first whether the job market is improving and er moving back toward the 2% target. but recent economic suggests there is a third criteria. officials are waiting to see if the economy can handle what they call rate normalization, or consistent march hire rati

it seems everyone has an opinion on the fed. the imf has waded into the debate about the timing of a rise. we are joined by su keenan in new york. this is very unique. su: a very big voice and you are correct. all kinds of investors and strategists that engage in a game, when do you think the fed will raise rates. mixthe imf to way into the is unusual but it does come as part of the annual view on what the fed economy is doing. and the market are giving his weight -- word they are giving is wait. higher policy rates could lead to market volatility with stability consequences that go beyond u.s. borders. weighing risks, we think that for waiting to raise rates until there are more tangible signs of wage and price inflation then our currently evident -- are currently evident. in other words, we believe that a rate hike would be better off in early 2016. specifically, we'd for the first half of 2016. an elegant way of saying u.s. fed, do not rock the boat. su: imf saying that they took the forecast for the second time. they are conc

for the fed to do that. rate droppedent 2/10 of a percent. would raise an interesting theory, that is this. we have seen some tremendous steepening of the u.s. treasury yields. it has been trailing in the billing market. keep in mind when the fed does eventually get to raising rates, we think they will do it in september. they raise front-end rates when the curb is steve. -- steep. yield spreads flatter, around 1:25. this selloff in bonds, we think it is a welcome event by fed policymakers. we saw u.s. stocks climb. and we saw 10 year treasury yields. bonds falling. yields rising. so, in a fact what does this mean for the traditional market sense of things? couple of things. first of all, what bond yields globally, believes in treasuries , at the end of january, we are much too low. they price dan a rather depressing environment globally. what we have seen in february and march, and we are starting to see in early may, is the data isn't as bad as the bond markets priced. there is a repricing going on. space, thend equity s&p can find a good ba

this confusion over the fed yesterday. p and goldman going in opposite directions in terms of the perception of what is going to happen. citigroup is saying september, not september. that encapsulates that even with the fed trying to provide clarity, the market is not taking clarity. scarlet: the fed thinks two rate increases this year on top of that. i can forgiveness the latest. and hang seng, both lower. one big story out of the region is demand returning to china's residential property market. stephen engle's reports from hong kong. relaxation is's seating into a home price recovery as new unit prices fell in fewer cities for a third month in a row. 40 one out of 70 cities tracked saw prices decline and 20 cities saw higher prices. an improvement over march and april. buyers are getting back into the market thanks to mortgage and the down payment rules and incentives like free porsches. scarlet: stephen engle in hong kong. there are reports that lester holt will become the permanent anchor of nbc's nightly news. hold re

really, you could blame this on the fed. yes, things are getting better, but they could be better. that fueled pessimism that ironically field stocks. a three-day rally, the s&p and the dow having their days in months. all of those sectors finishing in the green. here is joe weisenthal. joe: really driving home that points -- you look at the classics, animal spirits, leading the way. a great indication the bull is back for now. was ironic, we had a lower dollar despite all of the andeek, that came out that did well for the multinational companies like gm, like dow. you had kroger beating estimates as well enough you'll be general optimism in the market. joe: green across the board. alix: and greases the word today. let's talk about the crazy rhetoric. christine lagarde saying we need adults in the room. there is an emergency deal with the big guys in brussels. joe: it was not good. a lot of negative rhetoric. the eurogroup.om >> we are very committed to a different sensual scenario, which is getting a credible solution for a future for greece inside the euro. they are one of our par