Transcripts For CNBC Closing Bell 20140107

Closing bell. Im kelly evans. Im bill griffeths. Fourth time was a charm. This is our first rally of 2014 after declines. Pretty good Economic Data, the trade deficit number was strong enough. Thats 10 of our economy. So that bumped up the growth estimates for the quarter. The trade deficit figures were a big deal. Very excited about trade deficit. You can talk about the Immediate Impact to the Fourth Quarter gdp numbers. 2. 4 to 3. 3 on that report alone. Could you talk about what it means for the u. S. Energy story. Could you talk about what it means for the u. S. Dollar because the trade gap which is part of the current account is shrinking quickly. Were here to talk about the rally. The dow is up 114 points. Not far from the high of the day, but we got a ways to go before an alltime high. As bad a start as weve had to the year, were only 40 points off the closing high for the Dow Jones Industrial average. Were only 10 or 11 points for the s p 500. Its the Rolling Stone article thats gone viral. Five Economic Reforms millennials should be fighting for. Guaranteed work, guaranteed money, making everything owned by everybody. The millennial who wrote this will make his case to kevin oleary. That will be great. The millennials are all fed up. They cant find a job so theyve got a solution for all of that, and kevin is going to join us to talk about the other side of that trade. Also, another madoff settlement without any Single Person taking the fall, and this time it involves Jpmorgan Chase. The institution is in the crosshairs, of course, settling criminal charges, but wasnt it individuals inside jpmorgan who did not alert authorities to what madoff was doing . So why does this keep happening . We still dont have individuals who are being helt accoud accou. The question becomes are shareholders being punished for the actions of individuals. Here is a look at markets right now. The dow is up 115 points or 0. 7 . It was 15,576, 336 points off the record closing high right now. Look at the nasdaq as well which is adding 40 points this hour. Almost 1 for this index. The s p 500 is up about 11. 1848 is the closing high for the s p. Its currently at 1838. Again, three bad days but were not far from record highs. Lets talk about it in todays closing bell ex chain. John manly who said im knnot coming on until this market rallies. Anton bear from up Capital Management and joe bela from shapers investment research. John, we definitely saw a lack of momentum beginning 2014, very different from what we saw last year at this time. What do you make of this right now . Youre still bullish on this market. I am bullish. Its not encouraging. Id rather see the market go up because theres a natural ten n tendency for it to go up and there has to be some explanation it didnt. I tend to ascribe it to the last few weeks of 2013. I think we may have robbed from peter to pay paul, but thats temporary. Joe, what about you . Lots of focus on the behavior of the market at the tart of tstar month. Do you think we could be facing a rocky month, a rocky year regardless of todays rally still . No, i dont think so at all. I think the other guest described it perfectly. We had a lot of strong momentum in late december of last year, so it sort of makes sense we would have a little bit of a breather for the market here, perhaps a correction in time or consolidation, and then perhaps a nice you be leg in january. I think one of the things we were looking at is Short Interest. We had one of the strongest years in the s p 500 in quite some time and yet Short Interest on the components or the stocks within the s p 500 at its highest level since june of 2012. A heavy amount of skepticism from the short sellers, which are betting on those components. Thats generally and historically has been a bullish combination. We alaska amy woo. We got the wires warmed up enough that she could join us right now. You have been watching sentiment through options trading action. What are you seeing right now as we begin this new year . Well, hi, guys, and happy new year. Happy new year. Happy new year. Kind of echoing what joe said as well from the options perspective. Your skew levels, your term structure, your sentiment is still more bullish than bearish. Even with payrolls coming up, were pricing in a very ho hum plus or minus 1 move. Id say really investors on the options front are much more focused on earnings. Much more focused on single name volatility as we head into earnings season. It really hasnt been that much about the macro, that much about the downside. We have one after the other lining up this week, anton, in terms of event risk if you wanted to look at it that way. We have on wednesday the Federal Reserve minutes. Thursday we get alcoas report. Friday we get the jobs report. Which of those is going to be most important in terms of figuring out where the market goes from here do you think . Yeah, since 2007, the feds have been such a dominant factor for investors, and so i will pick the feds report. Thats going to be very, very important. Theyve had major impacts on investors sentiment. Every time they make a change in the announcement or their monetary policy, the market responds immediately. So im going to be paying attention to the feds policy and their announcements. John, you have established youre still bullish. Do you though change what youre bullish about . Do you look to other sectors for the new year compared to what you were investing in late last year . Not from late last year but from early last year, yes. Were getting more cyclical. Were sort of following whats going on in the economy and trying to get ahead of it. I think the economy of the United States is still improving. I think europe is about to improve. How far can the emerging markets be behind . We want to own things like technology, like industrials, and even big energy. Are you worried that technology has been a laggard to begin this year . Well, again, what i say doesnt happen immediately. I always get worried. But having said that, no. I think the fundamentals will out over a period of time. Corporations are as profitable as they are because of technology. They will spend more on that, they will upgrade further. I think its still a very good story. Joe, its actually tech that remains one of the undervalued sectors whereas health care is extremely overvalued at a time ironically when pricing across the Health Care Industry is under pressure and declining. Do you Like Health Care here and how do you feel about technology . Im not a big fan of health care. I think in general all the sectors are going to trend higher if the u. S. Equities trend higher. Big fan of technology in general. I also like energy and some of the basic materials. I think perhaps they underperformed in early 2013. All of a sudden took a leadership role in late 2013. I like the sort of sentiment price action backdrop on those names. I think some of those names, especially talking about earnings season coming up, energy and the coal names, they have the least expectations in the entire market. Joe, its funny you bring that up because coal has been an overlooked but extremely important area both for the energy story and to look at a peabody down 30 year on year at a time when the u. S. And overseas more of our energy needs will have to be met by coal at least for now. Why hasnt that name done better and is it possible 2014 could be a better year for the likes of peabody . Possibly peabody. Its in a similar industry but i think the price action is a little stronger is cliffs natural resources, clf. During the past couple months its all of a sudden made a longer term bottom on perhaps the weekly or monthly charts but daily charts momentum has been incredibly strong. You see a lot of doubt surrounding those names. Analysts, the majority of them arent recommending buying them. I think theres upgrade potentially. Short seller targeting coal names. Amy, speaking of earnings season, typically it becomes a gauntlet that causes volatility. We didnt see that a lot last year perhaps because the market was enjoying the morphine drip of quantitative easing from the Federal Reserve but now we know theyre going to taper, are we going back to that volatile period we typically get every time corporations start releasing their reports . Thats a great question, and its one that were watching very closely because as the tapering starts to come and we remove the yellin put or the bernanke put, so to speak, were really questioning whether this reverts to normalization. One sector i would fach is financi financials. 50 of all financial weights come off and well see from a volatility perspective if that ticks pup. 2014 will be the year of the old normal. You dont believe in secular stagnation. Secular stagnation, let me think about that for a little while. Wow. Were going to tease it for the next block. I know. Well get your answer. Thank you so much. Stocks have bounced back with a vengeance. We want to get over to dom chu. Lets start with google which hit a record high earlier. Jpmorgan has an overweight rating. Rather august 2014 the ipo was 85 bucks a year. Johnson johnson moving higher after their blood center drug succeeded in a late stage trial. Thats helping boost shares. Comcast hitting a record high after the ceo said it sees its first video Customer Growth in six years in this past Fourth Quarter. Comcast is the Parent Network of nbc universe ideal which runs cnbc. Then theres herbalife and new skin after the fda did not name them. They fell after the agency said it would make an announcement regarding fad weight loss produc products. On the downside, netflix taking a hit as Morgan Stanley down grades the stock to an underweight from an equal weight citing increased competition from the likes of amazon prime and hulu. Heading toward the close, look at this. Pretty good rally. If you havent been watching at all so far in 2014 and this is your furs time, youre going to think, were we go again. Far be it. Were finally getting a rally. Despite todays big rally, bob dahl says he thinks the market is getting ready for a big selloff. Also, the Energy Industry is lobbying congress to overturn the ban on exporting domestic crude oil, but one of our next guests says exporting oil would send gasoline prices skyrocketing here in the United States. Well hear from both sides of what has been a controversial issue. Plenty of analysts have been jumping on cocacolas bandwagon. Find out if you should follow their lead or stay away from this underperforming stock. Our sarah eyssen has a coke and a smile just ahead. [ male announcer ] legalzoom has helped start over 1 million businesses. If you have a business idea, we have a personalized legal solution thats right for you. With easy stepbystep guidance, were here to help you turn your dream into a reality. Start your Business Today with legalzoom. Afghanistan, in 2009. On the u. S. S. Saratoga in 1982. [ male announcer ] once its earned, usaa Auto Insurance is often handed down from generation to generation. Because it offers a superior level of protection. And because usaas commitment to serve current and former military members and their families is without equal. Begin your legacy. Get an Auto Insurance quote. Usaa. We know what it means to serve. Open to innovation. Open to ambition. Open to bold ideas. Thats why new york has a new plan dozens of tax free zones all across the state. Move here, expand here, or start a new business here and pay no taxes for ten years. Were new york. If theres something that creates more jobs, and grows more businesses. Were open to it. Start a taxfree business at startupny. Com. If you have a business idea, we have a personalized legal solution thats right for you. With easy stepbystep guidance, were here to help you turn your dream into a reality. Start your Business Today with legalzoom. Welcome back. Well, you may have noticed that gas prices have come down a bit lately due in large part to the countrys ramped up domestic oil production. Now the oil industry wants to export some of that domestic oil and make some money on global marks. The problem is theres a longstanding ban on exporting domestic oil. So the industry itself is lobbying congress to lift that ban. Good idea . Bad idea . Lets talk about it. Tyler slocum is director of the Energy Program at Public Citizen. Chris faulkner. Tyler, whats wrong with if we have much more energy now than we can use, whats wrong with exporting it . First of all, we are using it, just its a question of discrete areas in the United States where weve got some surplus of oil, and so that surplus helps drive down the price for refiners and that leads to slightly lower gasoline prices. If were taking that raw crude oil and instead of having a surplus for u. S. Refiners, forcing u. S. Refiners to compete with chinese refiners, thats going to push the price up, and its going to raise prices for gasoline. This is business 101, and the issue is should the United States export a raw product Like Crude Oil or should we be utilizing our Manufacturing Base and allowing our refiners and our chemical processors to turn that petroleum into the finished product and then export that finished product rather than the raw crude oil. What we do right now. Chris, is the real issue here the shortage of Refining Capacity in this country . Theres two issues. Number one, infrastructure. Thats true. I think the next thing is the refineries here are built for sour heavy crude from south america, from the middle east. Theres going to be an issue where were going to have lack of investment dollars being plowed into the ground to continue this Oil Revolution thats taking place. Were already exporting crude to canada, which you failed to mention. 100,000 barrels a day up from zero in 2007. The reality is america is on the road to energy independence. Our usage of oil has fallen 6 Million Barrels a day. If we have an excess why can we not compete on the Global Markets like we do with coal what youre saying is youre actually arguing for American Energy dependence but dependence in other words on crude being exported and being more intertwined with the global system as opposed to trying to create this sort of oasis where we just produce and consume internally. No what, i, what im arguing this embargo went into place it was built on fear and scarcity. Were exporting more distillate fuels than were using. It will continue to invest in the Oil Revolution. Gasoline prices are geared on the global market, not on the United States market. Gasoline will still continue at the level it is today. Latin america, china demand has to be factored in there. You cant use fear and scare to say, oh, the United States cant be exporting its crude oil. Its hogwash. I was going to bring that up because every time i hear the argument that prices are going to go down if we deregulate or something, i think back to the Airline Deregulation of 80s. Ticket prices were supposed to go down and we know what happened there. We beholden to the Refining Capacity in this country. Which is at max. Actually, no. Biexporting oy keeping the o will that keep prices down if we cant refine it fast enough. Actually we can refine it fast enough. The Refining Capacity exceeds domestic not for light, sweet crude. Since 2008, domestic demand has been dropping and flat lining in the United States due to higher fuel economy standards for vehicles and slower Economic Growth. In fact, u. S. Refiners are exporting 3 Million Barrels of Refined Products a day because they cant sell it in the u. S. Market. But the surplus of crude oil allows u. S. Refiners to buy it at a discount relative to china, and so the fact is that youve got a split within the oil industry. Youve got the big heavy hitting producers like the exxonmobils that want to export the raw, crude oil and then you have the independent refiners like vel lair row that sound like Public Citizen. They want to keep the export ban in place and the fact is that you never know when global commodity disruptions are going to occur. Just because things are smooth and easy right now, in a matter of days or weeks, you could have a serious issue in the middle east or china. Chris, go ahead. Reality is were going to face an issue in in country which Public Citizen wants us to face. We have to sell the oil at a heavy discount which could make it uneconomical to produce or stop investing it is not going to make it uneconomical to produce. Absolutely they are still earning you guys are scared of hydrocarbons coming out of the ground, period. This is a way to scare the American People that they think gas is going to skyrocket we should put a ban on oil. Let me tell you something about the oil industry. Theyre making a fortune you dont know anything about it for starters. This is an issue of whether or not they want to make youre chris, let tyson make his case. The fact is that the oil industry is making huge profits with this crude Oil Export Ban in place. With the ban in place, exxonmobil prodistripredicts by the United States will be the Biggest Oil Producer on the planet. The ban does not discourage oil development, but removing that ban is absolutely going to impact gasoline prices for americans. You have to look at the supply demand fundamentals. Youre absolutely incorrect. You dont make any sense. You want us to be more like nigeria and russia and adopt the nigerian model of Economic Growth. That can refine our oil and we cant refine it here. We refine it here. Were exporting absolutely you dont even know what were talking about. Tyson, one question. Are you opposed if the administration were to make it easier for more refiners to get into the game, to refine the crude that is produced and consumed in this country, are you opposed to that for any reason . Well, i mean, the industry is not going to build any new grassroots refineries. You say so. Theyve done additions to Refining Capacity and retooling refineries to deal with more of the oil coming out of the bachan and eagle ford but no one in the marketplace is talking about building new refineries from scratch. This will create more jobs and the president s own Energy Secretary said it needs to be looked at and lifted. What youre saying does not make any sense. Whats happening in america now is causing a big divergence. There are markets around the world that need this oil. It would create a 17 billion to 20 billion increase in revenue for our country. Why can we export natural gas and coal but not oil . It does not make any sense. We got to go, guys. Were out of time. I suspect you guys would be fun to have lunch with sometime. Great seeing you again, tyson. Take care. Thanks very much. Appreciate it. We have 40 minutes left to go before the close and were turning around here from the selloff that is marked the first three trading days of the year. Were up 114 points. Were only about 40 points now, bill, below the alltime closing high of the Dow Jones Industrial average. Have you noticed coke stock, it has popped and fizzled over the past year. Where is it going in 2014 . We have a good oldfashioned stock brawl coming up. And guaranteed work and universal basic income even if you choose not to work. Those are two of the five Economic Reforms millennials should apparently be fighting for according to the author of a controversial new Rolling Stone piece. Kevin oleary attempts an intervention later on the closing bell. Fedex one rate. Really makes my life easier. Maybe a promotion is in order. Good news. I got a new title. And a raise . Management couldnt make that happen. [ male announcer ] introducing fedex one rate. Simple, flat rate shipping with the reliability of fedex. Stock brawl coming up. Intervention later on the im phyllis and i have diabetic nerve pain. When i first felt the diabetic nerve pain, stock brawl coming up. 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Dont drive or use machinery until you know how lyrica affects you. Those who have had a drug or alcohol problem may be more likely to misuse lyrica. Having less pain its a wonderful feeling. [ female announcer ] ask your doctor about lyrica today. Its specific treatment for diabetic nerve pain. To hear more of phylliss story, visit lyrica. Com. The dow is up nearly 24 over the past year as you know, but cocacola has really underperformed its blue chip peers gaining just 8 over the same period of time. More wall street analysts are starting to jump on the coke bandwagon. What has changed . Good question. Its become somewhat of a darling for analysts and part of it is it just looks cheap. Underperformed its peers like pepsi. And some of the other consumer staples. If you look at the valuation and then you think about the bullish story, analysts say, look, what happened last year, you had some temporary factors at work. You had unusually wet weather. You had economic slowdowns particularly sharp in the emerging markets. Remember the fear of tapering led to that exodus from some of the emerging market stocks, bonds, and currency. That impacted coke. You also have another bunch of factors working toward coke people liked pepsi over coke because they felt like they were more diversified smack business. Choosing healthier drink options. Coke is really the Industry Leader when it comes to soda, and that could be a good thing this year because there is an expectation that is they will innovate. Its been six years since coke zero. Working on new products, lower calories, more naturally sweetened. You also have the world cup. Theyre a lead sponsor which is a Marketing Campaign but actually if you look back historically on south africa and germany before that, coke saw sales boost as a result of the world cup. Its also lead sponsor of the olympics. You have those factors working in favor. And you have a booming middle class. No matter what you have seen, these trends in place since the late 90s, less soda consumption, you have a growing middle class around the world. International is the longterm growth story. You start to see these economies doing better and that could really help coke. We have the back story from sara eyssen. Lets talk whether its ready to break out and pop for investors. Took one for the team there. Jonathan thinks theres huge opportunity in the stock. Abigail doolittle thinks could leave you flat. Shocking. Thank you to both of you for being here. Jonathan, why do you like coke here . Well, i think theres a huge Global Growth opportunity thats remained but gotten out of focus. La theres going to be 700 million new members of the middle class over the next 10 or 15 years. Thats Something Like three new american middle classes. A lot of people are focused on the declining consumptions in north america but, you know, thats really small potatoes if thats town 10 , up 10 over that time. Whats happened in the past happens in the future with carbonated soft drink consumption hand in hand with Economic Growth in a lot of these hot places where people would love to have a cold coke with more spending money. This will be a great stock and a great Growth Opportunity almost regardless of what happens in developed markets. Abigail, are you worried more about the fundamentals or the technicals on cocacola. A little bit of both here, bill. All i can say is i wore red for this occasion. Its appropriate for cocacola at this point for more reasons than one when we look at fourn. When we look back at 2013, it has been a rough year. Revenues have declined, Earnings Growth has fallen into the low single digits, and as weve heard, most investors tend to think that the bad news is priced in. Theyre focusing on Growth Opportunities abroad. I say not so fast. When we have negative Inflection Point of revenues falling on a yearoveryear basis, thats a big ship to turn. That takes time. I think investors could be disappointed going into the first part of 2014. Valuation, it actually looks expensive to me. These shares are trading at 20 times earnings. Thats at a premium to pepsi relative to low single digit growth right now. I think were going to see a bout of profit taking here in cocacola. Jonathan, im guessing the dividend is part of the story here for a certain class of investors for coke. 2. 8 which is flirting with where the tenyear is right now. If rates continue to rise in 2014, do you think coke punches back, does something bigger with its dividend . Well, certainly thats possible. Its a very cash jen ray tiff company. First of all, all the infrastructure for this Global Growth overseas a laid. Theres a lot of companies talking about increasing penetration of their businesses. Theres not a lot of them that have been in the emerging markets for 50 or 60 years and are sitting and waiting for people to get a buck in their pocket and do what their parents did and buy more coke. The second thing is the cost savings opportunity domestically. Anheuserbusch after its acquisition by inbev saw over 2 billion in cost savings. This company has talked about 600 million in cost savings. I think there could be a lot more than that and we could start to hear more about that as they grapple with the more constrained growth in north america and get rational about it even in the sex snext six we. Got to go, folks. I dont know how high up you are abigail, i think i saw a cloud go by in the window. Thank you both for your thoughts. It is a chilly wind out there. Up 114 on the dow. Kind of holding here. It looks like even though were how many points away. About 40 points from the alltime high, we have a pretty good rally finally under way for 2014. Incredible. And by the way, remember this guy . Take a look. Hes the american executive held hostage for six days by workers at his factory in china last june. He will join us next to talk about a similar situation that just happened to goodyear managers in france. Its happened again. Jpmorgan shares getting hit after paying 1. 7 billion to settle charges related to its role in not flagging Bernie Madoffs massive ponzi scheme. We will have a full report on that, and should the government be prosecuting individuals as well, not Just Companies . Let us know what you think on this controversial issue. Well reveal your best tweets coming up later on the closing bell. Cnbc sector sort is sponsored by sector spyder etfs. [ bagpipes play ] make it happen with fidelity active trader pro. Its one more innovative reason serious investors are choosing fidelity. Call or click to open your fidelity account today. Theres a saying around here, you stand behind what you say. Around here you dont make excuses. You make commitments. And when you cant live up to them, you own up, and make it right. Some people think the kind of accountability that thrives on so many streets in this country has gone missing in the places where its needed most. But i know youll still find it when you know where to look. Welcome back. Lets start with a look across the indexes as the dow has 120 points. The nasdaq popping more than 1 . The first positive trading day of the year. The s p 500 is ten points off its alltime record closing high. 1839, up about 12. Theyre fast kicking to the close as we like to say. Track and field here. We have 25 minutes left to go. A scary situation over in france. On monday workers at Goodyear Tire and rubber factory blocked a door and held two managers hostage. The managers were released earlier today before the situation got too much out of hand. Lets bring in someone who has had firsthand experience in dealing with this kind of situation which across the globe is not that uncommon. Chip starns is the ceo who was held hostage by his own workers in china last year. Remember that story . Well, hes with us now. Hes working for a Different Company presumably with employees that wont take him hostage, and we welcome our own colleague from cnbc asia, eunice, who is joining us in the United States for the week here. Were thrilled to have you with us, eunice. She covered that story last year. Chip, let me start with you. Thinking back, now weve got these goodyear executives who are being held hostage. What is going on . Is that an effective strategy . Did it work for your employees when they did this last year . No, absolutely not. It didnt work and im surprised to hear this is almost like an epidemic thats going from now around the world continent to continent. In our particular situation, it shut the entire facility down, its insolvent now. Looking into today what happened with the goodyear situation, i dont understand what the positive outcome will be in terms of negotiations like that and what i experienced in china. Youre absolutely right. Theres a term for this, its called boss napping and its happened notably in the depths of the recession when a lot of people were losing their jobs. France in particular has tough laws about not laying off employees. Its a different situation in china. The workers to some extent feel as though they are in charge or can exert sort of their say. I wonder what happened after this episode in china . What was the reaction both from bottom to top . There were a lot of people who were really mulling over chip starns case. People who were wondering what are some of the lessons learned. What is interesting is because the economy is slowing down, people are worried theyre going to see more of these type of boss napping situations, there have been a lot of discussions as to what maybe could be done better. They were saying that for american ceos, if they do want to lay off their own workers in china, that they shouldnt put themselves into a situation where they actually are alone with the workers in the factories. They were saying a lot of people were saying either dont do it at all, have the local people, your local managers do it for you, or if you yourself feel that need to go in and lay off the workers themselves and talk to them, bring them to a hotel that is centrally located in a city so that in case things go bad, you have a way out. Chip, in your view, is this are these cases countries that are just going through growing pains as they try to get used to capitalist ways of doing business . France has existed for some time. But in china your employees were worried they were going to lose their jobs and look what happened. They were right. They lost their jobs. Was it because of what they did or was it just inevitable because business was not supporting that factory . Well, i think it was actually in our particular case in china we were actually going to leave a segment of the business there. We were only going to move the plastic Injection Molding site to india, but the wetside of the business was staying. In that particular case we had a riot not a riot but they unionized and sat an our equipment so they wouldnt allow the equipment to be packaged and leave. And they actually started demanding the same severance package that the other workers that were being laid off, they wanted the same. And so in our case a rumor spread the whole factory was shutting down. But they were right. Well, i guess they were in a sense they were right. But we didnt have any idea or any thoughts of moving the wet side of the business. But the bad thing about it is for people like us, Investment Business gentlemen, we invest, deploy capital around the world, when we do this and disagreements may come around, segments of the business may have to move, where is the support from the police, from the local government . Did anything happen to the individuals that held me captive for seven days . Is it going to be considered a crime in france for what just happened for the gentlemen that got held for the last couple days . When you think of all these corporations that want to move, set new factories up, et cetera, you know, are these the intangibles we have to take into account. Eunice, we have to go but do you think this will make an executive who a couple years ago would have thought whats the quickest way i can get to china rethink that . I think it will. I thought what was really interesting about what chip was saying was in france the police did intervene, but in his case and in a lot of cases in china, the police were on the side of the locals, and a lot of that is because the police are nervous if they are to clamp down on these workers too harshly because theyre not so sophisticated in where to direct their anger, the anger can be directed to the authorities. That was the real difference i saw there. Chip, good to see you out from behind bars. Thanks for joining us. Eunice, we look forward to working with you this week. Eunice down here tomorrow, in fact. Looking forward. 20 minutes left to go before the close. Weve come off the highs just a touch. The dow is about 108 points at 16,533 at this hour. The ripple effects of Bernie Madoff still being felt five years later. Now with Jpmorgan Chase. Theyre taking a multibillion dollar hit. We have details on that coming up. Plus, we want to get your tweets on this, your thoughts. Tell us if you think the government should be going after individuals instead of just institutions like Jpmorgan Chase. And after the bell, its millennials on the march. From protests to petitions to a new manifesto demanding guaranteed jobs for everybody for life. The author of that article will join us to defend his generation. Keep it right here. [ male announcer ] this is the story of the little room over the pizza place on Chestnut Street the modest first floor bedroom in tallinn, estonia and the southbound bus barreling down i95. This magic moment it is the story of where every great idea begins. And of those who believed they had the power to do more. Dell is honored to be part of some of the worlds great stories. That began much the same way ours did. In a little dorm room 2713. This magic moment this magic moment but with less energy, moodiness, and a low sex drive, i had to do something. I saw my doctor. A blood test showed it was low testosterone, not age. We talked about axiron the only underarm low t treatment that can restore t levels to normal in about two weeks in most men. Axiron is not for use in women or anyone younger than 18 or men with prostate or breast cancer. Women, especially those who are or who may become pregnant, and children should avoid contact where axiron is applied as unexpected signs of puberty in children or changes in body hair or increased acne in women may occur. Report these symptoms to your doctor. Tell your doctor about all medical conditions and medications. Serious side effects could include increased risk of prostate cancer, worsening prostate symptoms, decreased sperm count, ankle, feet or body swelling, enlarged or painful breasts, problems breathing while sleeping and blood clots in the legs. Common side effects include skin redness or irritation where applied, increased red blood cell count, headache, diarrhea, vomiting, and increase in psa. Ask your doctor about axiron. Welcome back. U. S. Authorities and Jpmorgan Chase announcing a settlement over the banks alleged role in the Bernard Madoff ponzi scheme. Its much nicer here. Anywhere inside today. It was cold. So we know now if there was any doubt before that in order for Bernie Madoff to pull off his massive fraud and keep it going for so long, he needed Jpmorgan Chase. They were madoffs banker for more than 20 years. The bank was in a position to know all but if it did, it didnt tell. No matter the bank has been in regulators sights almost since madoff confessed. They are agreeing to one of the largest penalties ever for violating u. S. Banking laws and they will have to make major reforms to head off criminal prosecution. But no individuals charged which Preet Bharara defends. This is about an institutional failure. The statement of fact recites in great detail some of the roles various individuals played in connection with the overall systemic failure but the interests of justice here, you have to look at every case individually. The overall cost to the bank a little less than two weeks revenue. They will pay 1. 7 billion to the justice department, 350 million to the Treasury Office of the comptroller of the currency and half a billion to settle private suits, including the one by bankruptcy trust yi Irving Picard in 2010 that offered a road map for prosecutions including this case. Virtually all of this money will go to madoff victims, some of it as soon as this year. Were asking our viewers their thoughts on why no individuals have been prosecuted at this point. Why do you think that is . Its a good question. One of the things that Preet Bharara said when we asked him about that is this Bank Secrecy Act the bank is accused of violating is an institutional statute, but at the same time as he said, there are all kinds of facts out there about what individuals were talking about as far back as 2007 and before that, individuals that are quoted but no individuals charged, and the basic reason could very well be that they couldnt make a case against any individual that they intentionally tried to defraud anybody. This is exactly the judges oped, weve discussed it on the air. Hes a sitting judge, tried some of these cases. He says its a central flaw of todays system that its basically the institution and not the individuals who are punished. What youre Say Something this is now almost been institutionalized because of things like the Bank Secrecy Act which are making it easier anyhow for it to be an institutional level breach. And what the judge said, and we talked to him after the article and reported on that, he said that its in a way sort of mutually exclusive to go after individuals or go after the institution. If you go after the institution, the individuals are tipped off. But in a sense, yes. Look, bharara or u. S. Authorities could have charged individuals with fraud if they could make that case. But its hard basically. It takes resources. It is hard. Youre going not for the government but for the investors, for the victims, and so this was a settlement, and by the nature of a legal settlem t settlement, no one is ever completely happy. Scott, as always, good stuff. Thank you. See you later. We want to know what you think. If the government should be going after individuals as opposed to companies when it comes to financial crimes. Tweet us your thoughts cnbctheclosingbell. 12 minutes left in the trading session with the dow in rally mode. All the major averages in fact. The dow up 115 points at this hour. Drama in vegas. A big time hollywood mogul walking off stage. A rival ceo escorted out of a party. And thats just day one. Whats happening today . We will have a live report coming up. Dont forget to watch the premiere of shark tank on cnbc 8 00 p. M. Eastern time. One of those sharks, kevin oleary, probably the tough he is shark on the panel, he will be on kellys panel coming up in the next hour of the closing bell. Looking forward to it. Aflac aflac got em. Yeah, hes clean, boss. Now listen to me, duck. I have an associate that met with, uh, an unfortunate accident. While hes been incapacitated, somebodys been paying him cash. Now, is this your doing . Aflac . Now, if i met with some such accident, would aflac pay me . Nice. This is your stop. [ male announcer ] find out what aflac can do for you and your family. Aflac . [ male announcer ]. At aflac. Com. We are the thinkers. The job jugglers. The up allnighters. And the ones who turn ideas into action. Weve made our passions our lifes work. We strive for the moments where we can say, i did it we are entrepreneurs who started it all. With a signature. Legalzoom has helped start over 1 million businesses, turning dreamers into business owners. And were here to help start yours. Welcome back. Yes, its true, a rally on wall street, first one of 2014. The dow up 121 points as we head toward the close with about eight minutes left. Joining me, kenny from oneill securities. Whats your version of why we had this stutter step to begin the new year . Because i think people waited until the beginning of the new year to take some profits because you saw that right away in the first couple days. Why would people have sold stocks right at the end of last year and had to pay the taxes in april . They wait two or three days and they make the sale, put the taxes off for another 16 months. Thats number one. The market goes back to 1825, finds some support and it rallies back. Were stuck in a tight range. Earnings are coming out, no reason to jump in front until you get a sense of what theyre going to be. Those who care about volume care about the fact ths beits pretty light. Today theres a little more volume. Which could be considered bullish, right . Very good. It tells you theres more institutional participation. The last couple weeks certainly into christmas and all that, a lot of the institutional guys just took a breather, right . But we still havent had a 10 correction in forever. Im not so sure youre going to get a 10 correction. I think the most we get is the 5 , 6 range. Which is all we had last year. The global story of 2014 is actually really true, right . U. S. Economy getting better, european economy getting better. Its a slow process but i think it is moving in that way. So, therefore, i dont think youre going to get that big, big correction because i think a lot of people are waiting for any correction to put more money to work. So what are you going to buy here . What do you like . If you believe in that story in the turnaround, i like infrastructure names. I like technology, i like certainly the financials although that story today in the paper about financials was not such a positive one, but its one that causes a little bit of concern. If you believe in that story, the Big Industrial type names, right . Which i do. Those are kind of the areas im looking at. The only guy who speaks with his hands more than i do. Thank you, sir. Youre welcome. How much longer . Well, its only seven days. Im going to try to give it another four days to see how it works. Our makeup staff loves that, by the way. Heading toward the close. Well come back with a closing countdown for this tuesday and then guaranteed jobs, universal basic income, all sounds great, right . But who pays for it . Thats the question kelly will ask the author of a controversial new Rolling Stone article. He is a millennial and he says thats something that millennials should fight for right now. Very interesting coming up in the the closing bell. Youre watching cnbc, first in business worldwide. About the most tracktested is ever. But the truth is. We dont have to. The experts have spoken. Now its your move. Now its your move. Those little Cialis Tadalafil for daily use helps you be Ready Anytime the moment is right. Cialis is also the only daily ed tablet approved to treat symptoms of bph, like needing to go frequently. Tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. Do not take cialis if you take nitrates for chest pain, as it may cause an unsafe drop in blood pressure. Do not drink alcohol in excess. Side effects may include headache, upset stomach, delayed backache or muscle ache. 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Change in aftermarket trading. All the tech stocks with a market cap. Of at least 50 billion. Are up on the day. 12 lowvolume stocks. Breaking into 52week highs. Six upcoming earnings plays. That recently gapped up. [ male announcer ] now the world is your Trading Floor. Get realtime market scanning wherever you are with the mobile trader app. From td ameritrade. 2 30. Look at this. A rally. Only took four days to get one off the ground. The dow right from the start you know, the Economic Data this morning, the trade gap number was very good, and it automatically had some of the houses on wall street upping their gdp estimates for the Fourth Quarter pretty substantially. That played well and then after that sideways move. Were finishing up here over 100 points so far with a gain of 0. 62 on the dow industrial average. Bob pisani is with me. Were going to look at the Home Builders which as youre pointing out, we saw a collapse for that group on an otherwise up day today. The only unfortunate thing is i was very happy in the middle of the day and they slowly moved to the downside. This is a little bit of a disappointment because this group was down 2. 5 on Interest Rate concerns for 2014. This is a very disappointing outcome but overall im pretty optimistic. We were talking about health care. Health care has joined financials. Health care is positive as a sector for the year. We had positive comments from one of the hospitals today about obamacare and the impact on the hospitals today. Thats helping overall. Everybody is picking health care again. It was a big thing today because nobody could quite figure out what the impact of obamacare is on a lot of these firms. Cyh came out and said even though their revenues will be disappointing a little bit, the negative impact of obamacare on the hospitals may not be as bad as people thought. Energy stocks are still lagging. Oil is still a little bit of a problem, but a lot of the exploration and production stocks are a little higher because natural gas is doing so well on very bullish report on natural gas today in terms of demand. It went up 30 today compared to yesterday just because of the record cold. By the way, the volatility index still going lower. Thats not bullish. For it to be that low. I have been wrong about this. I was anticipating as we came out of the holidays and the vix was down, it would move up a little and stay over 15 hasnt happened. We havent been volatile at all. I know people were worried about the stock market but the market has moved in a very narrow range, about 150 points on the dow in the last four or five days. Materials havent done much. This is one of the concerns over china. Thank you, bob. See you later. Thats it. Were finishing our first rally of 2014. Can it continue . That remains to be seen. Hour two of the closing bell with kelly evans and company. Ill see you tomorrow. And welcome to the closing bell. Im kelly evans. Take a look at how were finishing across the major indecks or indices for the gra marians out there on twitter. The dow is up 105 points. Thats off the highs of the session but its still a triple digit gain. Its 16,529, puts us not too far from the alltime high of 16,576. Across the nasdaq as well a stronger Performance Today up almost 1 . Adding 40 points there. The s p 500 adding about 11 points to 1837 and for its part the closing high is 1848 so were only off by 11 points. On that note, lets get straight to todays panel. Im joined by our very own Sharon Epperson and kate kelly. Cnbc contributor carol roth and shark tank investor kevin oleary. Shark tank is on tonight at 8 00 p. M. Eastern. Kevin, were so glad you could join us for this. Look, i just want to kick things off with some of the ladies sitting right next to me who can tell me about the energy story in this country, sharon, and how much of an affect, for example, we have Natural Gas Usage at a record high but thats because theres freezing weather. We have the fact the trade deficit just closed significantly. Fourth quarter gdp looks like its going to be great. Does it feel like 2014 is the year america becomes a story of selfsustained energy fueled economic revivalism . Weve already been on this trend, of course, and this is a trend thats likely to continue. You look at the latest report from the Energy Department today on their shortterm outlook, and were going to continue to see record levels of production of natural gas. Were going to continue to see boom in production of oil as well. This shale production is really having a significant impact. What were seeing right now though, of course, is a big increase in demand, and were looking at a 30 increase in demand here in the northeast for natural gas just since yesterday. And some of these numbers. The really cold temperatures were seeing. Thats contributed to the rise weve seen in natural gas. We have seen that over november and december. Thats why today futures are flat. So were looking at natural gas right there up about half a percent, which is an increase but nothing like what you would expect for the fact that we just hit 134 keep in mind though, we saw natural gas futures up 30 in 2013 best performing commodity. These are futures. So traders are anticipating what its going to be like. Everybody knows its cold in january and we knew we would see frigid temperatures. Thats part of the reason why were not seeing as much of a gain right now because weve already had it. Cash prices for nat gas are very right now. They are certainly high because of the pipeline capacity. Theres a concern about getting some here is why i ask, too. You could almost argue that energy if its on the natural gas side is going to sap some of the Consumer Spending power. Were getting some of the retail numbers in and like the com score ecommerce stuff was softer. Maybe the holiday period wasnt as great. Was it the cold weather . Yet wall street is up 100 points today. Well find out about that very, very soon, on thursday when we get com store sales and what im really concerned about there, kelly, is i think the ones that do post a really good top line, it may be at the expense of profits. There was a lot of heavy discounting and that was trying to make up for the lack of traffic. I dont know if it was the cold weather. I dont know if people were just feeling overspent, no pun intended, but i think that thats really been a challenge for them, and so i think once we get those numbers on thursday, its a big week between that and the jobs number. Youre going to see a lot of ups and downs potentially and a lot of volatility for the rest of the week. You know what i think . I think people are really optimistic about the month of january. I was talking to Hedge Fund Managers yesterday getting more of a feel for what are they going to do this year, how do they feel coming off such an ebullient 2013. They said were starting from scratch. Were willing to take risks because we have 11 months to make it up if things dont go well. Ohoh. There are some concerns i know. It will be an interesting few weeks. I want to know what the shark says. Kevin oleary, 105 points on the dow. Whats your take on all this . Im pretty happy with it but im sort of a top down guy. Here is the way i look at it. I think were good for 2 to 2. 2 dividend yield on the s p 500. So youre guaranteed that. The market is going to give me around 8 . Id be ecstatic with that. If we get pee pan ee expansion, get some more. Im kind of bullish on whats going to happen. Kevin, dont you think theres a fair degree of con n consensus we will have pe expansion this year . I dont think thats in the can because theres always Political Risk here. Weve got some issues that politicians havent finished with yet. I dont like whats happening with the financials. You know, 17 pe trailing, are we going to get back to 23 . I dont think so. Not only that im just thinking on a sicyclically adjusted basis its the price of the stocks relative to their earnings. If this is one of the year where the price is going up but the earnings arent there and what that all means not only that, market cap to sales. Weve been talking about earnings but we know theres been a lot of Financial Engineering behind that. Market cap to sales at about 60 above average right now which says to me this is a very nice, full valuation. Im not going to say its bubble valuation. But in terms of getting expansion on that, i think that thats a big bet. Carol, i have heard that point, too, although i do think an economic recovery is going to probably float a lot of other boats. I was speaking to a banking che executive to said when gdp gets to that pointed, statistically the heat comes off banks from a Public Opinion standpoint. People are happier with the banks. Thats actually why i wondered and i was floating this theory before. If were shifting from occupy wall street to more of an occupy the board room mentality, kevin, where youre starting to see sharks, if i could use that phrase, circling companies saying youre sitting on a ton of cash, we want you to put it to use, higher wages or fatter dividends or want you to make acquisitions or want you to do something with that money, what would you say to ceos who are sitting in the board room feeling the heat . I love activist investors. I like performance with ceos, cfos. I think you should be given a 36month reign. If you dont deliver, i think you should get whacked. Im ecstatic with the way the world is working that way. My only concern regarding the market is that most of the s p 500 companies have found their growth not in america. Theyve got 47 of their sales abroad now. So i have to take on more of a global risk that i didnt have to do ten years ago. So i have a little bit in terms of, you know, dialing in my enthusiasm while i wait and see what happens in brazil, india, and china because half of my sales are coming from there. And japan. A lot of investors, a lot of Retail Investors arent paying attention to those global numbers smps thas much as they. Dont you think thats the key for them to understand how much of these companies have depended on their Global Growth and what thats going to mean for them . They cant just look at the stock price alone. No, i think thats correct. And thats whats different about this next decade. But so far so good. You know, were sitting in a sub3 gdp growth environment and were getting Earnings Growth with s p 500 of 6 . That means theyre working a whole lot better than our government is. They figured out how to get growth we cant find at home. Guys, stay right there. Joe, i want to bring steve grasso into this conversation. Everyone has been waiting for this pull back forever now, but no one wants to sell this market, kelly, ahead of earnings. I think youre going to started to see us take out those old highs and it might be the obvious trade that wins once again. Is that because so Many Companies have lowered the bar that everyone is expecting them to clear it and generate upward momentum throughout the season . Everyone has been so afraid. Analysts have been so afraid ever since the financial crisis of setting that bar too high. So thats become cause and effect why you see a lot of this rally. Steve, here is a question about market psychology. Everyone i talked to, my small sample poll, seems to think its going to be a good 2014. A solid one, 10 , maybe even 20 . However, i did talk to one fellow yesterday who thinks in his group theyre talking about a correction sometime in the First Quarter that could be substantial. Are you hearing that as well . Well, we are all looking for that selloff late in the year. Were all looking for it in the First Quarter. There definitely has to be a correction. Whether its 5 to 7 , i think its a healthy correction. And, yes, im hearing the same thing. This guy even said 10 or more. 10 is going to be shocking. Steve, this is carol. I wanted to jump in on the momentum stocks, too, because it seems like Morgan Stanley and some other banks have been downgrading some of the big names where weve seen a lot of movement end of the last year. Is that something that youre seeing or hearing where you think theres going to be a rotation out of some of the big high flyers from last year into perhaps maybe some of the more defensive names . If you think about it, when were you going to sell that high flyer . You didnt want to sell it in december and pay taxes immediately. The time to sell it is january. That seems like the obvious trade. The guys that have been downgrading those high flyers, theyve been downgrading them for the last quarter of the year. So theyve been wrong and they have to keep pushing their position. Every time they get a little momentum they pile up on them again. Were seeing a lot of down grades. In other words it went further than we think it should be. Im personally long twitter and going into earnings nobody has any guess what earnings will be. I will tell you one thing, no one wants to be caught short going into twitter earnings. And we should note that stock was down another 7 today. So it just is big moves to the downside as we saw to the upside. Thanks for stopping by. You can catch steve coming up on fast money at 5 00 p. M. Everyone else says with me. Coming up ahead, wall streets first rally of the year. Bob dahl will tell us why he says another good year ahead despite his forecast for a 10 correction. The bulls then charging once again. Doll will make his case coming up next. Later five Economic Reforms millennials shb fighting for. Thats the title of a Rolling Stone piece penned by a millennial. Wait until you see whats in it. Lets say kevin oleary is hoping to set him straight. Keep it right here. Youre watching cnbc, first in business worldwide. Hoping to set him straight. Wait until you see whats in it. Welcome back. Well, it took four sessions in 2014 but the dow pocketing its first solid rally of the year. Lets start off with Micron Technology rising in the after hours session. The company posting First Quarter earnings of 77 cents a share which may not compare to analyst estimates for 44 cents. Still, revenues, sales, came in at 4 billion versus estimates of 3. 7 billion. Those shares on the rise. A programming note, micron Ceo Mark Durcan will be live on squawk box tomorrow. Moving on, the Container Store moving lower after hours. Posting an 11 cent gain. Profits came in at 11 cents. Sales coming in light at 188 merchandise. Web md moving higher late in the session on a report it sees growing mobile demand and is looking for acquisition opportunities and were going to end with macao gaming stocks. Raising its 12 month price targets for wynn, mgm, and Las Vegas Sands saying chinese high rollers will continue to love macao because its morphing from a casinoonly environment to more of an entertainment hub kind of like what vegas is. Nice moves for those gaming stocks. Dom, thanks very much. If bob doll is right, u. S. Equities will see a 10 correction in 2014 but still finish the year higher. He joins me to talk about his predictions. Welcome. Thank you. Lets talk about the selloff. The number of people who expected double digit decline may be coming may be upon us. Thats your call for the First Quarter of this year . Honest truth, i havent a clue when. My better guess is first half than the second half but lets face it, markets have been easy. 2013 was straight up. Thats not normal. Having a pullback of roughly 10 is a very normal occurrence in the context of a good year. My point is to suggest this is going to be a more normal year, a bumpier year than last year. Where the market goes both up and down. We havent had a correction since 2011. Its now 2014. Does that set off alarm bells for you . Not necessarily, although i would argue short term the market does feel a lyle tired. The advance decline line, the new high, new low list if i can be a technician for a minute and my guess is that could be part of the seeds that sow some sort of pull back. Bigger pull back you foresee is in gold. Its had a decent start to the year. If that tells us about where were going, does that make you rethink the bearish case . Not really. If the dollar is moving up, which is our case, real Interest Rates moving up, the world healing, normalizing, thats hardly an environment for gold to do well. Look, people bought gold, they were concerned about inflation, not a problem at least that i can see. And that the system might fall apart. Neither of those things happened. Its no surprise that gold finally had a tumble. I dont think weve seen the low yet. Socgen said 2013 was the year we tested the taper. 2014 will be the year markets test the feds forward guidance. We have a big jobs report on friday. Do you think this is a case where we have a speed up scare where its the falling unemployment rate, that the fed has to communicate whats going on in the labor force . Easily could happen. If we get 3 real growth, inflation of 1. 5 perhaps heading towards 2 , were looking at 5 nominal growth. That is not consistent with fed funds at zero. So i do think the debate between, if you will, the markets and the fed will come to how can you keep rates at zero for the foreseeable future. Do you think the markets will force the feds hand . I do. I think were going to get to the point look, the fed has worked overtime. They staked their reputation on protecting us from the deflation. Theyre not going to give up early. If im concerned about the fed doing something wrong, it will be too late. They will wait for the markets to force their hand. I think they want people like you to have that concern. Youre absolutely right they do. Maybe theyre behind the curve. Talking specifically you also like Municipal Bonds here . Theres some value perhaps in the big selloff 2013 has created . Yes. We think Interest Rates drift higher, but within that that munis outperform treasuries. Thehe headlines on puerto rico d detroit. It suggests to us that the spread, which is very wide, between muni yeds on an after tax basis and taxables will narrow. I have to give you a hard time about that and saying you think active investments will outperform passive ones. Because to some extent, thats the business. Thats what were looking for. We active guys have done a horrible job in the last few years. As the world normalizes, as correlations fall, active managers are starting to do a better job. In the Third Quarter 51 of us outperformed the indexes. I think theres more of that to come. Its 51 sounds mathematically like its almost a truism. Well, but most of the time or i should say in recent years the numbers were lower than that. At the prove only 21 of active managers outperform. Horrible job. No wonder index funds and passive have gotten so much money. Perhaps that does change this year. Well watch where people are putting their money. Bob doll, thanks for joining us to explain what you think lies ahead. What happens in vegas is not just staying in vegas this week. Find out why hollywood director michael bey of transformers fame walked off the stage during a live presentation. And the tmobile ceo was escorted out of an at t party. Well get more details on whats going on when we come back. 24 7. Im sorry, im just really reluctant to try new things. Really . Whats wrong with trying new things . Look mommys new vacuum cat screech you feel that in your muscles . I do. Drink water. Its a long story. Well, not having branches lets us give you great rates and service. Id like that. A new way to bank. A better way to save. Ally bank. Your money needs an ally. [ male announcer ] heres a question for you is your tv powered by coal . Natural gas . Nuclear . Or renewables like solar. And wind . Lets find out. This is where americas electricity comes from. A diversity of Energy Sources helps ensure the electricity we need is reliable. Take the energy quiz. Energy lives here. Theres nothing like being your own boss and my customers are really liking your flat rate shipping. Fedex one rate. Really makes my life easier. Maybe a promotion is in order. Good news. I got a new title. And a raise . Management couldnt make that happen. [ male announcer ] introducing fedex one rate. Simple, flat rate shipping with the reliability of fedex. Welcome back. This years Consumer Electronics show in vegas is attracting more than 150,000 techno files from all corner the world. Theres been plenty of drama in the first day. Jou julia and jon are there in the middle of it. Julia, you just wrapped up an exclusive. Approval of a proposed merger which would create the largest ad agency in the world is moving faster than expected. Telling us he expects good news from the eu sometime this week. Here is why he says ces is crucial to his business. There is always something which is impacting the life of the consumer. So its extremely important if you want to help the brand and the advertisers to connect correctly with the consumer to be at the latest stage of state of the art innovation. Publicis drives more than 40 of its revenue from digital. It has deals with google and twitter. Tomorrow levy will speak on stage with twitters ceo. Twitter plays a role as an accelerator of information. It doesnt build over time. It builds immediately. Facebook is playing a role which is much more on a longterm relationship. Beyond the usual suspects, facebook, google, twitter, levy says two companies that his brands are moving more money into right now are linkedin and spotify. Interesting stuff. Back over to you. Julia, stay right there. We want to turn to jon fortt to talk about some of the drama. There was michael bey walking off stage although drawing attention to samsung. Then john ledger who escorted out of the at t party. It seems like the point is were talking about the people, not the products, by the way. A little bit of both. Both of those things were surprises, but very different kinds of surprises. In michael beys case it seems like that wasnt quite calculated enough. With these big presentations, it seems like theyre all natural, like theyre there for a chat but usually these are highly orchestrated rehearsed things. Didnt seem like they rehearsed that. Bey wasnt in a position to ad lib and walked off. In the case of john legere, he said he just wanted to see the macklemore concert. Something tells me when he crashed that party, he knew something might happen. Thats a great point. Stick around. I think we had to lose julia. I want to bring the panel in on this. Consumer electronics show, theres been a lot of discussion about whether 2013 was a lost year for tech and whether in 2014 where are the big products . Where is the excitement . Have you guys been following it, following along looking at, you know, the smart plan and getting excited . Before i answer that, i have to say this is the best thing i have ever seen from michael bey on film ever, ever. Touche. But i think that the challenge with a show like ces is that anybody who has a really big, important product rollout were going to be talking about are doing these proprietary oneonone events. So i think ces has kind of become a lot of sizzle and maybe not enough steak when it comes to the product rollouts. Thats why were talking about john legere and michael bey because the things you have to have are getting proprietary roll y0u9out approximates. Hes talking about being the uncarrier, catering to a younger crowd which crashing a party and getting carted away is a very youth move. Yes, i agree, its a bit of a ploy. But at the same time hes talking about a new ideology, isnt he . He is. And its all about personality. When youre talking about these conferences, that is what people are drawn to. What are other people using . We were having that discussion about whats the neck thing i should have . Its not necessarily because of what the product looks like in the presentation but who has it. I think a lot of personality around this whole conference is something people are watching very carefully and jon did a great job in making people look at tmobile again. Jon, what do you say to all that . This isnt so much a place to launch mind boggling products. Keep in mind, its happening in january right after the big holiday season. This is a place to sell. Youve got buyers from walmart, literally hundreds roaming the floors looking for the things theyre going to stock in the stores in the back half of the year. There are some big ideas here but theyre from the little companies. Theyre from the folks who are trying to get this Iris Scan Technology down and attract the attention of a retailer. The Bigger Companies like your samsungs, apple is not even here. Sony. Yeah, they might throw their own event to do their big launch because they know they can draw the press, but the little guys are trying to catch you on the floor. What is the little guy to watch . Where should we be looking next . I wonder whats going to be next on shark tank, too. Go ahead, fortt. Reporter i dont know if i have seen any one thing thats going to be the big brand or the Big Technology to make smart home take off but a lot of the big players here in distribution, in retail are sniffing around some of the concepts where you have sensors all over your house that turn on your lights i love that. Activate your alarm system, get your coffee brew pentagon. Do you like where this is headed . Would you invest in a lot of Smart Home Products . Ces today is a boneyard for investors. Theres nothing for me to do there. This is a giant behemoth war between sony and microsoft for control of the living room and the whole wearable computing thing. The truth is it was a decade ago when i used to be able to find Small Companies on the booths around the corners, interesting technology. You dont find that anymore. This thing is a lot of sizzle and where do you find it . And zero steak. You know where im finding them now . Im finding them on shark tank. We have 40,000 applications. I dont know though, kevin. You talk to diana olick, and she says that the Smart Home Technology is one of the biggest trends on her beat, that people are excited about it. And to jons point, that is a huge and nascent market that were talking about. Couldnt there be some interesting innovations there that are seeking capital . Briefly . Here is the problem, those technologies, and believe me weve seen four or five of them this year on shark tank require massive distribution and back end systems to monitor them. The only way to make any money is tyme getting a Distribution Deal with a black decker or somebody else that can actually put the product to market. And that squeezes you out. Its not that lucrative to be a first round investor in those technologies. By the way, its a very competitive space. Got to go. Kevin, great point. Jon, thank you so much for joining us, and please keep us abreast of anything else thats, you know, that goes down this evening basically. Katie couric will be on the stage. Thats interesting. What are your thoughts on michael bey. You have to deal with a teleprompter every day. What was your Free Association when you saw that . I laugh because they were talking about sort of this meltdown. Im sure everyone in the control room back at hq is going this is not a meltdown. This is nothing compared to what happens on Cable Television every day. So it is i guess more id like to think its more of a skill than people realize. Not one thats always well executed. Must have been a new years resolution. The federal trade commission going after companies for false advertising in weight loss. Plus the millennial leading the charge for change. Hes pushing for guaranteed jobs and guaranteed income even if you decide not to take your guaranteed job and hes not kidding. Hell state his case and well find out if kevenin olearys hd explodes. Carols might too. Thats coming up. Guaranteed job and hes not aflac got em. Yeah, hes clean, boss. Now listen to me, duck. I have an associate that met with, uh, an unfortunate accident. While hes been incapacitated, somebodys been paying him cash. Now, is this your doing . Aflac . Now, if i met with some such accident, would aflac pay me . Nice. This is your stop. [ male announcer ] find out what aflac can do for you and your family. Aflac . [ male announcer ]. At aflac. Com. Welcome back. We have a market flash. What can you tell us about chuck e. Cheese . Cec entertainment. If you have a parent you are obviously familiar with this company. Reuters is reporting that the restaurant and Entertainment Company is exploring a possible sale to private equity. Now, the irving, texas, based company which has a Market Company of around three quarters of a billion dollars. Reuters is saying everyone is declining comment here, so cec certainly on the move, kelly. Back over to you. Occupy the board room strikes again. Its that time of year millions of americans are dieting and exercising to shed unwanted holiday pounds. The federal trade commission is watching their backs and waistlines going after four companies for what they describe as deceptive advertising. Eamon javers is the latest on this story. Fdc officials this morning saying some of those Weight Loss Products you see advertised on tv might just be a little too good to be true. Take a listen. Consumers who base their new yearss resolutions on the promises of quick and easy weight loss that these products make will be very disappointed. The claims simply arent supported by the evidence. So what did the fdc do today . They singled out the makers of four products who have been charged with deceptive advertising claims. Part of an ongoing effort to stop misleading weight loss claims in advertising and marketing. In total these weight loss marketers will pay nearly 34 million to settle these charges. So who is involved here . The products involved include sensa which was marketed as a product that consumers could simply sprinkle, eat, and lose weight. Those makers will pay 26. 5 million to settle charges. Also a Company Called loccitane. They will pay 450,000. Lean spa. They will surrender assets total be 3. 7 million and hcg diet direct marketed an unproven human hormone. The judgment in this case was suspended due to an inability to pay. Cnbc has reached out to the makers of all of these products and asked them for comment. We havent heard back from any of them but the fdc also saying today that they werent banning any of these products. They were just saying these guys needed to stop doing what the ftc called misleading advertising in marketing. I cant imagine where the sprinkle and lose weight came from. Thank you. Appreciate it. Im going to the gym. Hes doing it the oldfashioned way. Were joined my mary engle from the ftc. Happy to be here. First of all, why these products in particular . Is this just because theyre the only four or the most agregregi to you are . Theyre certainly not the only four and we have more investigations under way but they represent the range of products that are making deceptive weight loss claims and also in the case of sensa it was a very widespread advertising campaign. Couldnt miss it if you watch tv, looked at magazines, and the sales were very large. So for you guys, it does matter how big the scope of these Advertising Campaigns is . In other words, if its going to reach several Million Consumers as opposed to just a few, its more likely to catch your attention. Well, thats right. We want to put a stop to largescale deceptive Advertising Campaigns, but we may also look at smaller ones as well on the internet that may be preying on particularly vulnerable consumers. What do these companies as soon as you come out and say theyve made deceptive claims, they do not have to cease selling the product, but they have to immediately cease the advertising. They have to change the advertising so they stop making deceptive claims. Do you have an open investigation into herbalife . The ftc as a matter of policy cannot confirm or deny any nonpublic investigation so i cant answer that question. I would just imagine that for a product thats so widely both used by millions and millions of people and also, of course, debated here on wall street that you would have to be taking a look. As i said, i cant really comment on that. How often should we expect announcements from your agency . Do you typically announce things just around the start of the year when people are more likely to be using these products or is this something we could expect, say, further announcements as you admit you have other open investigations within a period of weeks or months . You can expect further announcements throughout the course of the year. We had a few that came together at the same time and we thought it was a good time of year to announce these, particularly weight loss cases, but they will be announced throughout the year. And last question, what would your main piece of advice be for americans who are trying to shed those pounds in this case then . Should they just take what youre saying into account when it comes to any kind of advertising for these kinds of products. Basically dont believe any ad that claims quick and easy weight loss. Its not quick and its not easy and you have to eat less and probably exercise more. So thats the unfortunately, its not new advice. Its not easy. Its not fun but thats the way it works. Thank you so much for joining us. Director of ftcs advertising practices division. Five Economic Reforms millennials should be fighting for. The millennial who wrote a controversial Rolling Stone piece. Hell explain what he means by Social Security for all and make everything owned by everybody. Stick around, right after this. [ male announcer ] once, there was a man who found a magic seashell. It told him what was happening on the Trading Floor in real time. The shell brought him great fame. But then, one day, he noticed that everybody could have a magic seashell. [ indistinct talking ] [ male announcer ] right there in their Trading Platform. [ indistinct talking continues ] [ male announcer ] so the magic shell went back to being a. Shell. Get live squawks right in your Trading Platform with think or swim from td ameritrade. Over the pizza place on Chestnut Street the modest first floor bedroom in tallinn, estonia and the southbound bus barreling down i95. This magic moment it is the story of where every great idea begins. And of those who believed they had the power to do more. Dell is honored to be part of some of the worlds great stories. That began much the same way ours did. In a little dorm room 2713. This magic moment afghanistan, in 2009. On the u. S. S. Saratoga in 1982. [ male announcer ] once its earned, usaa Auto Insurance is often handed down from generation to generation. Because it offers a superior level of protection. And because usaas commitment to serve current and former military members and their families is without equal. Begin your legacy. Get an Auto Insurance quote. Usaa. We know what it means to serve. Welcome back. This Rolling Stone article getting a ton of buzz. Five Economic Reforms millennials should be fighting for. Those five according to jesse mireson include guaranteed work for everyone. A universal basic income, taking back the land, make everything owned by everybody, and a public bank in every state. We appreciate you even graced wall street in presence given you were occupying it how long ago . Constantly it feels like. Constantly. What spurred this article and are you serious about these five things weve just laid out . Yeah, absolutely. Look, we have a lot of unemployment, right, obviously, and we live in the age of selfreplicating robots, robots making robots and theres not so much need theres decreasing need for human living labor. We have to figure out a graceful transition away from there is people have a way of contributing to society and producing culture and Community Without going broke and starving and getting evicted. Kevin oleary, whats wrong with that . Jesse, thank goodness you and i have met. They tried this experiment once before. It was called the soviet union and it ended very, very badly. You can just google it and see everybody ended up down by the river eating government cheese. Why do you think this is going to work . Well, i dont know exactly what this youre referring to is, but each of the five reforms that i have proposed are currently in the world. Four of them in the United States in the come communist hel hoels of alaska and north dakota. It goes around the cost of education. One of your concepts here seems to have a premise that an education is a right, not a privilege. And i have a huge problem with that because anytime a loan is extended from a Government Agency or supporting an educational activity that doesnt reflect the market cost, i have a problem because im paying that bill. Ill give you an example. If you want to spend seven years getting a philosophy degree and you want to borrow the money and then come out and sit on wall street complaining, you deserve to go to debtors prison because you know with certainty youre not going to get a job. I will charge you 18 plus i want your parents home as security. Theres a freedomloving individual. Look, i will say this. I didnt write anything about education so im not totally sure what youre referring to. But the fact that i mean, there basically already youre complaining young people have a lot of debt. Most of it comes from educational debt. Thats where they find themselves in a horrific position. You didnt read the piece did you . College is way too expensive and people have taken on too much debt. I would like to jump in here because i think, you know, i know you have been taking a lot of flack. I am possibly not going to beat up. Bring it. This is sort of a learning opportunity because i think there are a lot of things millennials need to be concerned about and debt is certainly one of them. I think student debt is a huge issue. The 17 trillion and growing of debt that the government has that youre going to be left with, and then a lot of the other things that are coming about, the fact that obamacare is asking Young Healthy people like yourself and your peers to pay for people who are older and more sick. I think there are a lot of things for you to get rallied around, but i dont understand as kevin said sort of the i am owed a job, im owed this, im owed that. Have you been learning perhaps some other things that you should be thinking about as youve gone through this process . Well, you know, none of these ideas are marxist. Theyre smith and ricardo basically. Universal basic income is similar to what murray and freedman proposed as a negative income tax and land value tax proposed by henry george who was a famous libertarian. None of these are marxist which is the main criticism. I think jesse who wrote a very intelligent thoughtful peace a getting a lot of paternalistic push back. I think the idea of a universal income of people who work or not is a tough sell but there are other interesting ideas including a revival of the new deal. How would you suggest your age group like advocates for it . What is the next step because i think some of this is a tough sell. Thats a great question. The political effort to get this done is going to be extremely difficult obviously. I propose it will probably take Something Like 15 to 20 years of really bitter political struggle to get any of these things passed which is part of the reason why i wanted to address millennials. I hate that term but thats why i decided to address us because in 15 to 20 years were going to be the group that makes up the sort of political dominant class in the country. So, you know, a lot of it is things like this, getting the word out and whatever. I squaus want just wanted to ma know i didnt propose everybody is owed a job. I think it would benefit everybody if everybody had income. It would provide people with means of support and a way to live and a way to produce community and culture and whatever people produce. Jesse, do you concern yourself let me let sharon get in here. I was just going to say that your generation is also great at creating jobs and thats one thing you dont really talk about as much in there. I think one of the things that really needs to be thought about with your generation, with millennials, with everyone, this is an entrepreneurial society. You cant think about how youre going to create your own opportunity and thats an opportunity that you had in that first point you made to really underscore while you have this political movenlt going on, there really needs to be a wholehearted economic effort to really get entrepreneurialism to build skills. Thats the one place it fell short here. You dont have a lot of economic background. Youre learning as youre going. The one thing thats key here is you talked a lot about getting the job but you didnt talk about the skills. This isnt just about raising wages by transferring money from one place to another. This is about innovation, creating the job guarantee i think spurs that sort of thing. If its run through the private sector im sorry, the not for profit sector, it acts like sort of a Public Interest fellowship where you could if somebody identified a communitys need and wrote up a credible proposal for how to meet it and wrote about how many jobs would be created in the process, they could obtain funding. Thats very entrepreneurial. Thats putting too much onus on jesses graduation. I graduated into a much better economy and i worked in college i said there were a lot of things they need to be concerned about i want to get kevin back into this if theyre not getting the training they need go ahead, kevin. Jesse, quick question. Just a concept here because im trying to work with you to figure out if theres any merit in any of these ideas, okay . Because i think you deserve that there is in all of them. It caused a lot of controversy. If youre guaranteed a job in your utopia, what reason would you have to perform . What would make you get up in the morning and do a better job than the day before if youre guaranteed the job . How can that possibly work in our capitalist society thats made us so great over the last 200 years . Or what if you did bad job . Do you have any sort of performance obligations . Novice that i am, i can refer you to some economic literature on this if youd like. The vcenter for full employment and price stability at the university of missouri at kansas city has a vast literature on how a job guarantee would work including answering your questions. I would look there. But in any case i would note that mostly what motivates people to do their job isnt the prospect of getting rich. For the guitarist the motivation is the standing ovation. For the artist, the motivation is the good review. For the coder, the motivation is putting out a the good review. For the coder, the motivation is putting out a viral piece of technology. And if people have the resources, the resource question settled and they know theyre not going to starve if they do a bad job, they have a lot more freedom to strike out on their own and be entrepreneurial in that way. Jesse, im going to make you an open offer. Last word, kevin. Listen to me for a second. Im going to make you an open offer. Come and work at one of my companies for six months and i will fix you. Okay . Not going to happen. Ill make you an offer. Come occupy wall street with me and ill fix you. I hate the temperature. Its terrible. I dont want to sit outside and freeze. We have to go, guys. Jesse, thank you so much for being here. Very interesting discussion. And the panel will stay with me. Theres lots we can read his piece, if you havent had a chance to online. You can catch more of kevin oleary on tuesday nights, starts with shark tank tonight. 8 00 p. M. Eastern. Thats all coming up in just a couple of hours. It is freezing outside. But the websites burning up. Stick around. The stories topping our hot list are next. And should the government going after individuals in wall street cases and not just the companies. Your best thoughts, on air, when we come back. Around here you dont make excuses. You make commitments. And when you cant live up to them, you own up, and make it right. Some people think the kind of accountability that thrives on so many streets in this country has gone missing in the places where its needed most. But i know youll still find it when you know where to look. Fifteen minutes could save you fifteen percent or more on car insurance. Yeah. Everybody knows that. Did you know there is an oldest trick in the book . What . Trick number one. Lookest over there. Ha ha. Madeest thou look. So endeth the trick. Hey. Yes. Geico. Fifteen minutes could save you. Well, you know. Welcome back. Its nice and cozy on our website, unlike the weather thats across most of the country right now. Allen wastler, whats leading the hot list right now . Whats heating us up is outrage clicks. Our number one story is the story about nearly 100 expolicemen and firefighters being accused of a broad disability scam. And i think the reason. Were getting 200 readers a minute diving into this story that was put together for us by our investigation team. I think the reason is it includes pictures like this one. This is one of the accused. Hes accused by the manhattan d. A. Of having about over 200,000 worth of disability claims. And there he is, pulling in a sail fish. You can understand why readers are diving into that. Number two, you just interviewed him. Bob doll. We have his predictions for the year. And three, it was bill nye the science guy. He was talking about the polar vortex. Surely thats not an outrage click. Its not. But were getting a social push from it. So many people are saying, i remember seeing him on the kids show. I do, too. Allen, we just interviewed jesse myerson. Did you catch that interview . How is that going to play online . My guess is its going to generate a lot of discussion. The fun part of that is going to be in the comments because the cnbc readership is going to have a lot to say about his point of view. People are already asking theyre saying, how would all this work with his employer . Of course, hes a freelancer and doesnt have an employer. He didnt ask if he would support these claims or not. Its interesting. A lot of comments already on cnbc. Well keep an eye out for it. Well check in with you tomorrow. Send us your tweets in the meantime. We want to know if the government should go after individuals not just the companies in wall street crime. Tweet us. [ male announcer ] the Wright Brothers started in a garage. Amazon started in a garage. Hewlett packard, and disney both started in garages. Mattel started in a garage. The ramones started in a garage. My point . 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We see this theme of where was the s. E. C. Amid the jpm thing keeps coming up. There was a whistleblower. They were told what to do. The governments not accountable for anything. One of the biggest issues we have facing us as a nation. No fiduciary duty. Every company has fiduciary duty and we do not at the government level. Kevin, thank you for joining us. Sorry we couldnt make it back here. Well be looking out for you on shark tank, every tuesday night, starting this tuesday night at 8 00 p. M. Eastern time. The new season kicks off tonight. Thanks to all of you for being here. Fascinating discussion now. Fast money coming up now. What have you got . Excuse me. Marissa myers, going through her remarks and tell us how to trade it. Over to you guys. Fast money starts right now. Watching the markets at new yorks times square. The momentum names. Forget tesla, linkedin. Were looking at to 14. And some of them may not be so sexy. Yahoo s ceo speaking out at the Consumer Electronics show in vegas. We have the highlights. And one 3d