Transcripts For CNBC Closing Bell 20140414

Expected earnings from citigroup and those retail sales from march that were better than expected that have been the driving force for the most part behind this rally, although were off the highs for the dow. It was up 159 point and now a gain of just 81 points. Keeping a close eye on the tenyear as well. Thats what art cashin would tell us. This rally is not the only thing happening. Basketball legend Shaquille Oneal in the house teaming up with macys for a new menwear line. That interview is coming up in a bit. Really looking forward to talking to shaq. Can answer anything about anything so well talk about his mens line and whatever else he wants to talk about. In the markets right now, shall we show you, rally on the open right now. Kind of held there, but weve been losing altitude for a couple of hours now. The dow up 78 points right here at 16,105. Yeah. Meanwhile, the nasdaq, as we mentioned, look at this, up about 4, a critical one to watch going into the close. Sharp focus on the ibb index. The s p 500 of his part for 7 points to give you an idea broadly of the kind of trading action. We have renee norris from urban wealth management, steve east and sam stovald and anthony chance with chase, of course, and Rick Santelli joins us from chicago. Renee norris, weve got this rally today, but you dont think the selling is over yet, do you . No, i dont. Hi there, thanks for having me. I do think that this is going to be a tipping point, and the selling thats particularly taking place and the social media and ecommerce is going to get us to the point where we finally will have the correction that weve all been waiting for. Anthony chan, over the weekend the situation in ukraine escalated catching traders off guard and we heard from mario draghi talking about keeping and trying to fight the strength in the euro. That kind of talk about more am days, those two crosscurrents here, how do we figure out, you know, and then the retail report, the strong retail sales report this morning from the u. S. , is that why markets are casting around for direction here because theres such conflicting evidence . No doubt that the weather improving is going to lead to Stronger Economic statistics but one thing to keep in mind from Central Banks around the world, and that is that they are in a mood to seep supporting the overall economy. We can debate until the end of time whether its the right thing or the wrong thing to do, but whether its the bank of japan, whether its the federal reserve, well hear from janet yellen later this week or whether its mario draghi doing a simulation about quantitative easing or in fact talking about a possibility of a negative deposit rate. The bottom line, kelly, they are there to support economies, whether we like it or not and thats a good thing. Well, they say they are anyway. And i think they are. I think they are sincere. Every time we hear something from them, especially mario draghi, he goes one additional step. I know youre itching to respond to that, rick, but first sam, earnings, less than a week of reports under our belt. How are we doing so far . Thats right, bill. Well, s p capital iq consensus numbers are actually going in the wrong direction, in my upon, showing a 1. 2 decline year over year as compared with a gain that was anticipated of about 3 at the beginning of the quarters reporting period, so maybe it will turn around. Thats our expectation. However, right now its causing investors to be concerned. Okay. And Rick Santelli, what signals can we glean here from whats happening in rates . We can talk about the u. S. Dollar, and by the way how about that budget report . Yeah. The budget deficit is down to something in the range of 2 of gdp. Well, i think theres a couple of things about the budget deficit, and, of course, the u. S. Economy and higher taxes temporarily will make this better and we know the u. S. Economy is doing better, and probably the reason the quality of the inputs gives you the quality of the outputs and all you have to do is look no farther than the Affordable Care act. Doesnt matter how many people sign up. Its like stock. The advancers versus decliners. What is the net change and how many new people have insurance that wouldnt have been involved in this process to begin with . Thats the only issue that matters, and all this truth will eventually hit. As far as the markets, Interest Rates are basically unchanged. The equity market says to Pay Attention to Interest Rates, but issue is tinkering, mario draghi, whether we like it or not, we can debate it all day, they are here to tinker. To make the aggregate decisions the market makes, its unemotional. When you get politicians, its about question dense, its about making a decision that may hurt a group and help a group. They dont do that well, and then all the influence peddling in d. C. And lobbyists, no way that any of this can turn out better than the market doing it itself. As we know, they are trying to prop up the economy, not the markets per se. Marks are going in a different direction. While rick was talking nasdaq turned negative for the first time today. Here we go again. On a watch for a lot of support levels that traders watch so much for. What are you watching right now . What are you inclined to buy these dips here, or will you wait it out here . Well, i would be inclined to ladder into the dips. I mean, not jump in, but buy a little bit. The narrative was lots of fiscal drag in 2013. That goes away in 2014. The economy gets better, but we had a weather event, and i think that if investors hang with it, they will see the economy get better as this weather effect stage. We saw it in the employment report, especially in hours worked and retail sales. Things will get better and the markets should turn around. I wont try to call this bottom of this little correction, it could go further and if you have any longer term time horizon you need to at least be nibbling on days like this and days like last week. Heres one line, guys, from a trader report earlier. Until we get a day where the volume is above average and the major index has posted a gain of more than 3 461 , thats the point that you think about stepping back in and more strength to confirm that kind of movement rene, not only are we not getting that today, theres potentially a breakdown on the breakdown going into the close. What are you waiting for . What do you do here . I think that a lot of the ecommerce and social media issues are clustered right on the nasdaq so it falls right into my feeling and thesis that theres such a huge overvaluation that thats got to be corrected, so until that happens, its not going to really represent a buying opportunity in that group, but there are other opportunities out there in the Broader Market i think that make a lot more sense. Such as . Are you getting defensive and going after some of the dividend names . How are you rotating in this environment . Yeah, i think thats a great, great point, kelly. At the end. Day there is a huge the Technology Sector as an example, its a huge sector, and i think hey lot of people are taking a brush and painting the entire sector as if they are overvalued. We have some Legacy Technology issues that are big contributors as far as dividend growers, not just dividend payers but dividend growers, and were seeing theres a lot of opportunity in that space. I like that space and like injuring. Do you like an intel, like a google both of which will report later this week. I do, i do, and i also like to take a look at Cyber Security issues. Thats an issue that will never go away. Still a growing area. Some of these issues are overvalued, but i would definitely be taking a look in that arena. Anthony chen, after the minutes of the fed meeting last year, we know the tenyear yield went down, and a lot of questions about is the support there. Are they going to hang on longer than janet yellen suggested before they start raising rates. Whats your expectations into and whats the tenyear telling you . Bill, right now we know that the central bank is being very, very supportive, and i say that because even though when janet yellen says that she thinks full employment is between 5. 2 and 5. 6 , the end game of the fed funds rate is still almost half of what their formal 4 number, they have a 2. 25 number even when the Unemployment Rate goes down to 5. 2 . What kelly indicated, a lot of geopolitical unrest, the ukraine situation, the russian situation. An environment where, again, some people disagree, but an environment where the value bank wants to be supportive. Lets go back to nasdaq for just a Movement Show us the intraday for nasdaq. I want to show steve this trading pattern real quick. Keep that in mind. Now, show us an intraday of Ticker Symbol ibb, and watch the correlation here. Yeah. I know. Were listening to our technician type it in. There it is, look at that. Thats the reason the nasdaq is where it is right now. Heres the question for everybody. Since when and why did the ibb become the new market gauge . What does it reflect . Is it just taking some of the pain out of the market more broadly or something specific to this market, steve, sam, rick, anybody who wants to jim in here, why here . How much of a tale is this for the Broader Market . Hey, kelly, this is sam. Ill jump in. What its basically showing is were seeing a rotation where investors are basically taking their profits, and a lot of these momentum areas, biotech being one. You can also say regionally doing this with japan in terms of cab size and doing this with small caps so really sort of rotating away from these higher momentum areas and focusing more on the Higher Quality companies that will be growing their dividends and earnings. And to follow up on what sam is saying, if you look the price earnings ratio in that sector, they were much, much higher in the overall market multiple so that rotation i think is healthy, and, in fact, it does tell us that the market will go a little bit further as you see that rotation from the very high multiple stock to those that are much cheaper. Thats whats healthy. Real quick, what are they saying about this in the pits . You know, in the pits they are basically saying that when you look to protect your nest egg, youre probably going to take the momentum side and liquidate it first, but eventually they suspect that everything is going to come closer to home so the froth is going to get scooped off and thats where they believe the Interest Rate market is saying with regard to the outlook of the economy, seen through the prism of the stock market. Thanks very much. We should point out Shaquille Oneal has made it to the floor of the new york stock exchange. I happen to see on his twitter account that he claims he did 7,000 autographs yesterday. Wow. And now hes adding to that count today as the traders of the floor make their way over, and well be talking to shaq a little later this hour about his new mens wear line. His kings won last night. Listen to you. All right. Now to the budget we talked about, the Congressional Budget Office cutting its estimate of the u. S. Deficit to 492 billion for this year. Again, another piece of news in a different market environment could be cited as a rone to rally. That was thanks to lowered expect the outlays for obamacare. Im an javers has the latest from washington. Reporter according to the Cbo Obamacare care costs will be a lot less than previously projected. Take a look at some of the numbers come out of the cbo in this analysis today. They are saying the projected costs will be 36 billion in 2014. Thats 5 billion less than proje projected, 1. 3 trillion two 2024. Thats 104 billion less than earlier projected. The white house in the person of jay carney, the spokesman, wasted no time in taking some credit for this today. Take a listen. The Affordable Care act is working. It shows that Marketplace Health care costs have gone down because premium estimates have gone down. Additionally, the effort to constrain Health Care Costs more broadly is showing continued momentum as evidenced by the further reduction in projected medicare spending. Now why is all this happening . The cbo said partly because some of the plans offered on the exchanges are more narrow than previously expected so that means that the costs to subsidize those will be less. Also, they said that the expectation is that over time the pool of people who enter this market are going to be a little bit healthier than the people we saw at the outset, so, guys, some stuff there for the Obama Administration to hang its hat on. Thats for sure, eamon. On the back of that, with everything going on about the euro over the weekend, japanese yen, the dollar index is almost unchanged at 79. 75 and a look at whats happening with the dow. The dow is starting to feel the pressure that the nasdaq has been feeling, that the biotech index has been leading the group up. The dow was up 150 points at its peak an hour ago and now a gain of just 32. Well keep a close eye on this as we head to the close with 45 minutes left in the trading session. Much more on the markets ahead. Plus big surprise. We could be on pace for record recalls this year in the auto market. The big question is whether that will drive customers away from showrooms all together. The pros will talk it out next. And facing new banks. As the old guard post quarterly earnings, social media giant facebook is now awaiting Regulatory Approval to provide emoney Services Like storing money, exchanging it with others and making payments and so forth. Well talk about the potential threat of new banking to the old guard coming up. And as we mentioned, as you just saw, shaq is in the house. Find out how the basketball legend is reinventing himself and suiting up for big business over at macys. And hes signing 7,000 more autographs right now on the floor. Well be right back. Ll be ri. In a world thats changing faster than ever, ll be ri. We believe outshining the competition tomorrow requires challenging your Business Inside and out today. At cognizant, we help forwardlooking Companies Run better and run different to give your customers every reason to keep looking for you. So if youre ready to see opportunities and see them through, we say lets get to work. Because the future belongs to those who challenge the present. Ameriprise asked people a simple question in retirement, will you outlive your money . Uhhh. No, that cant happen. Thats the thing, you dont know how long it has to last. Everyone has retirement questions. So ameriprise created the exclusive. Confident retirement approach. Now you and your ameripise advisor can get the real answers you need. Well, knowing gives you confidence. Start building your confident retirement today. Matteo pelucchi matteo pelucchi. Welcome back. A Major Development in the market right now. The dow was up 160 points at its peak today, but weve been watching the selling in the Biotech Sector which has taken the nasdaq into negative territory and has taken the rest of the market with it, so now the dow with about 43 minutes left in the trading session is up only 37 points, so were watching some key support levels. Obviously, kelly, nasdaq is now comfortably below that 4,000 level that weve been watching so carefully. Not a lot of strong correlations in this market that will keep people what may be happening in the hedge fund space. Dominic chu has been tracking todays big movers. Thought we might get a difference after the weekend, but not so sure. Losing a bunch of steam going towards the close, nasdaq turning lowering, big names, microsoft, facebook, apple, even tesla, one of the momentum names weve been talking about for quite some time. Like bill said, biotechs also falling. These are the big names, ishares, bioshares index, etf attracts them and on the flip side web md soaring after it said it expected First Quarter results to top its previous forecast due to an improvement in sales and mastercard and visa, gaining ground after a couple of positives from analyst on wall street and well end on began motors, the management shakeup continues as people in charge of Human Resources and Public Relations have left the company in the wake of the companys ignition switch issue, so gm certainly a focus not just because of the stock because its auto show week here in new york. Guys, over to you. Thats right, dom, thank you. 2014 is xweerg up to be a record setter when it comes to auto recalls and here we thought those were all in the past. Gm and toyota, take a look. Two of the companies, a look at the headlines lately. And if this pace continues, the u. S. Is on track to break the recall record, a dubose record indeed which could cause concerns for investors of these companies and possibly scare off car buyers for the same time. For just how this is all affecting the auto sector were joined by the car coach, auto analyst and Senior Analyst at kel kelly blue book. Thanks for joining us. Eric, youre all about values and prices on cars. Could we see a dampening effect on all the recalls on the value of cars, especially when you consider how robust the used car market has been the last few years . Well, yes. Thanks for having me on your show. So far i think its too soon to tell exactly how gm is going to be impacted by the recalls. Sales down 2. 3 through the First Quarter of the year. At the same time, the industry was up by 1. 3 . However, most of the decline for gm was based on a cutback in rental volume which was a decision that was totally voluntary on the part of gm. Okay. You know, lauren, heres the interesting thing. At the same time weve had these record headlines, record recalls in all of that, the auto Sales Numbers last month are really strong. Yeah. True. I mean, there was a lot of incentives involved as well so thats something that you have to take into calculation, that if there were no incentives, you know, what would consumers be purchasing in the incentives are a very big part of getting people into the showroom floors. The old profitless prosperity. Moving inventory but not making any money, right, lauren . If youre looking at a new corvette, a super high demand and they will sell them out. Looking at the new porsche, gt3, same type of thing, everyday driver cars that people are owning to get them into the showroom and get rid of the cars that they have, you kind of need an incentive, and if youre not going to do it, your competitor will, and thats what youre seeing happen right now the. Thats what i was going to ask, eric. To what other extent are other brands coming up pressure because they have to offer incentive or capitalize on what may be some nervousness around the buying public . No doubt there is increased competition this year. We are seeing incentives going up, but at the start of the year we were projecting 16. 3 million in total sales for 2014, and that would represent an increase of about 4. 5 over the 2013 levels, so we think that auto sales still remain strong. Yeah, they have got to, lauren, to meet some of these estimates. Morgan stanley when they downgraded gm the other day among other factors said the reason is because they thought theu auto sector was deep. I dont think theres a huge dive in sales. Consumers need cars. They have kept their cars longer on average than they have in the past, and the results of that is that cars need to be replaced, plus theres some great quality product thats on the market. Theres a lot of researched brands, specifically the chrysler lineup. Every vehicle in their lineup has been refaced and if it has been it will be after the new york auto show. The stream of auto shows are going to help i would think from the marketing standpoint. 35 minutes to go now into the close, bill. The dow is up about 55 , the s p 500 up 3. 5 and the nasdaq is dying down five points. 39. 94 is the level there. Would you trust your money with facebook . When we come back, wait until you hear which Banking Service the social networking giant wants to get into. Shaquille oneal wearing new clothes. Find out how the basketball legend is getting into the fashion business with dollar signs in his eyes. Be right back. [ male announcer ] when fixed income experts. Work with equity experts. Who work with regional experts. Who work with Portfolio Management experts, thats when expertise happens. Mfs. Because there is no expertise without collaboration. [ dog barks ] [ male announcer ] imagine the cars we drive. Being able to see so clearly. To respond so intelligently and so quickly, they can help protect us from a world of unseen danger. Its the stuff of science fiction. Minus the fiction. And it is mercedesbenz. Today. See your authorized dealer for exceptional offers through mercedesbenz Financial Services. Thats why i got a new windows 2 in 1. It has exactly what i need for half of what i thought id pay. And i dont need to be online for it to work. It runs office, so i can do schedules and budgets and even menu changes. But its fun, too with touch, and tons of great apps for stuff like music, cause a good playlist is good for business. I need the bosss signature for this. Im the boss. Honestly i wanna see you be brave welcome back. Theres a look at citigroup. The earnings parade continues. 10 of the s p reporting and citi is surging after surging a solid earnings. Kay lar tausla tausche, how rest of the week shaping up . Some mixed, jpmorgan not so great and citi soaring on their First Quarter. Beat of the street on the top and bottom line and within the business theres good, bad and ugly to report. The good, improving credit let citi release more from its market reserves and also revenue at citis bad banks soared. The bad though, weakness across the board in the Consumer Bank where head count will be cut by 4,000 at the rest of the year and ceo will be fighting for a shrinking pie. Analysts focused on the ugly. Two issues came to light in q1. Fraud in the banks mexico unit still under investigation and the second is the failure of the banks stress test and Ceo Michael Corbat said hes responsible. Its in my scorecard and something for which im sure the board will hold me accountable for in 2014 when they reflect upon the year, and im accountable for it and accountable for fixing it. He said the bank added 6,000 people for audit compliance in what he called the fixable problems and went rush to submit it till next year. Highlights we have a mixed value across the board for the baines and not easy to predict how they will go. Casebycase basis, Morgan Stanley on wednesday and Goldman Sachs on thursday. Really hard to see how they will continue. As investors try to digest jpm, thats the weakest component on the dow today. More as she said later this week. The Traditional Financial Services companies, you know, theres a wellknown tech brand looking to encoach on their space. You can add it to the list of potential concerns. Talk is old versus news, facebook is getting ready to launch Financial Services in ireland first. That would allow people, users of facebook, to make payments, store money, all using the social network. Richard hunt from Consumer Banksers Association Says facebook has no business getting into finance, while kevin r 0 sse thinks this is a great move for the social media giant. They have a gazillion users and want to monetize them somehow. Literally going into doing that by going into monetary services. We will compete anywhere, any time, any place against anyone. I noticed they went overseas first to start their brand of banking, but its not really banking in the traditional sense. What im saying is once they enter the United States they should become a bank and have the same rules and regulations that all 7,000 banks have. We must have a level Playing Field in this country. Wait a minute, kevin, can you explain what they are actually doing here. Is this payments, something thats more of a threat to paypal . The kind of thing we see mobile companies in other parts of the world getting in on, or is this actual banking where they would need to be a bank company . Official details havent been released yet, a preliminary phased experiment but from what we understand facebook is getting into a peertopeer Volume Exchange system. I could send you money. You could send me money. This has been an extremely popular money. Mobile banking is huge in the developing world in places like africa and india where people dont have access to a lot of traditional Banking Services and facebook has more than 1 billion members. Makes a lot of sense for them to try to do Something Like this. Richard, can you comparify what a bank is versus a Payment Company . Well, think about when you wouldnt facebook still need to use a bank, right, to affect these Financial Services and payments . Yeah, they would today. However, if they entered the Traditional Bank system where they received the positive in bank loans and had to come under the regulation of the fdic and the occ then thats a different entity. You mentioned earlier where does paypal fall in that category . Right now they are not a Traditional Bank, not receiving deposits, passing money from one person to another. Mobile technology is big in the United States, even though we have Traditional Banking systems here and seeing a major transformation in banking take place right before our eyes so dont think that a bank, whether its large or small, can get into the digital space. Yeah. Many banks right now are doing that. Are we overthinking this. Maybe they are going after the paypals of the world, not the citigroups or jpmorgans . I dont think anyone will get their mortgages from facebook any time soon. I dont think thats a Business Model that facebook wants to emulate. Whats interesting is that facebook has tried Something Like this. Had a Payment System called facebook credits that got shut down because no one was using it, and part of the reason no one was using it is you couldnt do the sort of peertopeer transaction, only for buying things on facebook apps, and it wasnt all that popular. This time around they have to get a lot smarter about the fees they are changing and the way people can get money in and out of system and the security of it. Can you make money doing this . Sure, if you shave off a few basis points of every transaction, thats thats millions of dollars a year. You know, our current mobile banking system, if the size is any indication. Im sure facebook is not last word, richard. Facebook sees money in this. They wont do it out of generosity of their hearts. I get that, but theres a lot of things they dont do out of the generosity of their heart and doesnt make as much money as they want, facebook credit being an example of that. Thank you. 30 minutes left in the trading session. Holding at these levels and well off the highs of the day. The dow is up 85 after having been up almost 160 points. Nasdaqs been flirting one changed for the last hour. It is now up five points, but it did hit 3985 and then bounced off that level. Starting to head higher. If we close in the red, it will be a four and a half month low. Ipo anxiety, a number of companies expected highs this week, on the heels of last weeks jittery markets. And after the break, he was around here a second ago. Where did he go . Shaq attack is here at the new york stock exchange. The basketball legend talks about his latest business play at the worlds Biggest Department store. Hes coming up after taking a few selfies after this. Tdd 18886282419 searching for trade ideas that spark your curiosity tdd 18886282419 can take you in many directions. Tdd 18886282419 you read this. Watch that. Tdd 18886282419 you look for whats next. 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Thits not the limit yoursh hard earned cash back card. Its not the confused by rotating categories card. Its the nocategorygaming, nolookpassing, clearthelaneim goingupstrong, backboardbreaking, cash back card. This is the quicksilver cash back card from capital one. Unlimited 1. 5 cash back on every purchase, every single day. Ill ask again. Whats in your wallet . 24 minutes left here. The dow up 77. Nasdaq barely holding on. The s p is up about 6. 5 point, well off the highs set earlier today. Now the big tax deadly tomorrow, its april 15th and that got us thinking. Who gets paid more, ceos, big focus of the New York Times over the weekend, or professional athletes . Mary thompson has been crunching the numbers. What did you find . Reporter it looks like athletes win by a long shot, off the tee or on the court. Much of their money comes from endorsements, not from salaries or tournament. For ceos their pay is tied very closely to the per fomance of their stock, over half of their pay is exdid ibased. Lets look at the number and names. According to forbes the highest paid athlete is tiger woods who makes 78 million on year on par with oracles ceo larry ellison. Second on the list, disneys bob eager, he earned 40 million less than ellison at just over 34 million, a much wider gap than the one that exists between woods and tennis great roger federer, the second highest paid at let netting 7 million less than woods in 2013. At the number three spot for the athletes, nba star kobe breezy point who makes close to 62 million a year, 36 million more than the third highest paid ceo, that being Rupert Murdoch. 21st century foxs ceo. He made just over 26 million last year. Wouldnt be a bad take for anyone though, on any level. Back to you guys. Somebody standing here just said that. Would that be shaquille . That would be shaq over here, sits in both of those categories, call him a ceo athlete i guess. Right. I was one of the first ones. I originated my whole brand after Magic Johnson and what he was could go. I was going to ask you who your mentor was . Magic was the guy that set the tone for you . Magic in 1992, and his words were to me was its okay to be famous but you want to start owning things and i was an early investor in google, and i wanted to start doing things. Youre the Warren Buffett of basketball clear ly. I also love that i have to look up to you. I could have worn much taller heels here. Getting used to that. The mens wear line at macys. Tell us about that. A lot of people think its a big man line. Not a big mans line. Fits me, too. As a big man i would go into macys and couldnt get the cool stuff and had a conversation with my partner who makes all the suits in the world. We wanted to do something very, very call. Even though im 71, im an all type of guy, so all types of people can go from 32 to 60. Why macys . Because macys is one of the number one brands, Number One Stores in america. I shop there, you know, for the kid, for the family and i couldnt find anything to fit me so i had a conversation with them, like, hey, big guys, regular guys, wide guys, small guys, any guys, all guys, i didnt mean to call you wide. Conor is getting it. We could use a little of this on the womens side, by the way, if i might add. There you go. Can i ask, by the way, when it comes to marketing. Saturday night live, what a powerhouse, when they do Something Like you and barkleys skit, how much of a boon is that for business . I think its hilarious and funny. I use a lot of humor to do commercials. Humor is a big reliever of stress, and anxiety and certain things so all my commercials use humor in them so saturday night live, thank you. Its just more funny talking about barkley than about me, but i like it. Do rich people pay too much in taxes . Im not rich, so i have no idea. You are rich. What do you consider rich . Im mentally rich. What is the threshold for being rich in this country . Always been mentally rich, never been a guy that tlifs hrin money. I meet a lot of people, have a lot of nice things and want to keep educating myself and keep having fun. Ive never been one of those guys. We just showed the list, the top three highest pate athletes and ceos in this country. What do you think when you see that list . Its very impressive, but a lot of guys such as myself we dont really like to tell people what redo and how much we make. Im sure Rupert Murdoch makes more than 21. 9 million, really . Thats on his pay stub. Yeah, thats on his pay stub. I do a lot of things that you know, i dont like bragging to the world. Im very blessed. Im just trying to learn every day and trying to meet people every day. Speaking of which youve been getting these guys to say whats going on here. Do you invest . Do you know whats going on back here . I dabble a little bit. I do penny stocks here and there. Penny stocks. Get into the big caps. Eve ever since watching wolf of wall street. Oh, come on. I just like to have fun. Had kobe here a couple of weeks ago. Hes investing in this sports drink business, and i said you should put your face on the bottle, you know, be a part of it. He said this is an investment. This is not an endorsement. Where do you stand on investments versus endorsements . You had a human brand, you know, even though youre investing, you should be on the cover of something . Ill do investments, endorsements and partnerships. A lot of times, if i really, really believe in a company ill say, okay, ill do an endorsement, but you dont have to be pay me, i want to be a partner in your company. Let me grow with you, and i dont really do a lot of endorsement deals, deals that im partnered up with the companies. Which puts you above that number that tiger got. Something like had a. Where do you stand on kobe these days . What do you mean. You guys, there was a big new yorker article on him that talked about the rivalry you guys have had over the years. Never had a rivalry. Just have to understand when youre dealing with leadership, you have to worry about the relationship and me being the leadership of the organization, you have to focus on the task. Look at it in real life situations there is no problem. Given whats going on with the lakethers year, phil jackson got away, off to the knicks he went, the buss family, time for them to sell the laker franchise . I would say no. They just need to put the right people in place, you know. A lot of times, for example, like ive always thrived on hiring people smarter than me, you know, jim is capable and gene is capable but where they thrived is when they hired the jerry west and other people like that. I think its time they evaluated and maybe hired somebody smarter or do things a little different. All right. Nice to see you again. This is our dance in high school. Me and mike. My guy from high school. From h. Conor is going viral tonight. I love that. Shaq, great to see you, buddy. Thanks so much. Really appreciate it. Thanks for stopping by. Need we tell you who this is. Here he is. Wherever you immediate to go, get more basketballs to sign. Take care. Thank you very much. Where were we now . Up 100 points on the dow and 15 minutes to go into the close. Well see what happens with the nasdaq, up 8 points and s p up 8 points. The fever pitch for Public Offerings may have broke. When we come back, seema mody runs through the diminished list of companies slated to go public this week. And later hold the beef. Beef prices are rising near a three decade high. We want to know how that will affect your summer barbecue plans. Your thoughts on air when we come back. Wheres my phone . Wheres my. You are feeling powerful with a 4cylinder engine. [ male announcer ] open your eyes. To the 6cylinder, 8speed lexus gs. With more standard horsepower than any of its german competitors. This is a wakeup call. [ banker ] sydney needed some Financial Guidance so she could take her dream to the next level. So we talked about her options. Her valuable assets were staying. And selling her car wouldnt fly. We helped sydney manage her debt and prioritize her goals, so she could really turn up the volume on her dreams today. And tomorrow. So lets see what we can do about that. Remodel. Motorcycle. [ female announcer ] some questions take more than a bank. They take a banker. Make a my financial priorities appointment today. Because when people talk, great things happen. Make a my financial priorities appointment today. Could save you fifteen percent or more on car insurance. S Everybody Knows that. Well, did you know bad news doesnt always travel fast . clears throat hi mister tompkins. Todd . Youre fired. Well, gotta run. Geico. Fifteen minutes could save you fifteen percent or more. music defiance is in our bones. Defiance never grows old. Citracal maximum. Calcium citrate plus d. Time to take care of business with century links Global Broadband network and cloud infrastructure. We constantly evolve to meet your needs every day of the week. Okay. Where were we . Ipo jitters. The number of companies expecting to go public this week has dropped. Thats in the wake of last weeks market it your mill. To seema mody for the details on that. Thats right. 16 companies were expecting the price last week but six postponed their listings. Oppenheimer says the delays dawe to the recent volatility in the stock market and a growing number of ipos are pricing below their price range. Last month 29 Companies Went public. Of those five priced above their expected range and two came in below. Already this month, 16 deals have come to market. Only one of those priced above the expected range and five priced below. Some highprofile ipos disappointing investors, king Digital Trading down 23 from its opening trade and high Life Financial which priced at the bottom of its expected range so shares fall on 4 of day one and continue to trade lower and select names are in big demand. A smallcap tries at at top end of the range and shares continue to trade higher than the ipo price. There are 11 companies expected to price this week, including an investment form and sabre taken private in 2007 and waybo, the twitter of china. Kelly and bill . Yeah. A huge some big names, seema. If it werent for last week, bill, you can imagine the excitement, a little more trepidation, but not just earnings we have to watch. Look what the market is doing right now. Its coming back. Thats a shoaq raly. Up 124 points on the dow so its come back. Nasdaq, boy, art cashin came by a little while ago and said watch 3985 on the nasdaq. If it can hold there you might have something, and guess what, thats exactly where it held, and look at that. Hit that number and bounced back, and were back in positive territory on the nasdaq composite index. Up 51 at the highs of the day so well see what happens as we have ten minute left to go until the closing bell. If youre lucky getting a tax refund, well talk about ways to put that money to work in the next hour of the closing bell. Cant afford to miss it. Be right back. Be right back. Especially if youre thinking of moving an old 401 k to a fidelity ira. It gives you a wide range of investment options. And the free help you need to make sure your investments fit your goals and what youre really investing for. Tap into the full power of your fidelity green line. Call today and well make it easy to move that old 401 k to a fidelity rollover ira. No matter what kind of business you own, at t Business Experts can help keep it running. Seamlessly. So you can get back to what you love. When everyone and everything works together, business just sings. Im taking off, but, uh, dont worry. Im gonna leave the tv on for you. And if anything happens, dont forget about the new xfinity my account app. You can troubleshoot technical issues here. If you make an appointment, you can check out the status here. You can pay the bill, too. But dont worry about that right now. Okay. How do i look . Thanks. [ male announcer ] troubleshoot, manage appointments, and bill pay from your phone. Introducing the xfinity my account app. About eight minutes left. Dom, look at the markets come back. Whats going on . Crazy, right, bill . Thought we were making that slow grind down towards negative territory and rebounded right back again. The dow, 16,184, only 20 points away from the days highs on the dow. If you look at the nasdaq, s p 500, it did briefly flirt with negative territory but back up on the day. Whats interesting here, bill, look at the sectors driving the s p 500 performance, technology, energy and material stocks. Three sensitive cyclical sectors on the rise. The laggards still in the green are telecoms and health care sector. The cyclicals certainly leading the way higher. Back over to you. Joining me to talk about the markets, crazy market right now, bob gelfon, traders love this market. What about money manageers . Do you like this kind of volatility . We dont. More longterm types of traders and sometimes that can create opportunities, do. Has this selloff created anything that you found . I think that with fed policy being continuings for as far as the eye can see it will put a floor under the stock prices so some of the weakness here is probably a good time. Doesnt mean that were in a correction or maybe something worse, still to be determined, but i i dont think were going to have a catastrophe just yet. I know youre long term. You likely to make switches to the defensive sectors right now, like so many are doing with the food and utilities, the health care and things like that, or do you just stay the course . Were more macro guys, so our philosophy is that we have to be diversified and keeping things like bonds that will do well if things get bad again is an important diverse fire for somebodys portfolio. Bob, stay right there. Well come back and get to the close countdown. Bob pisani will join us in a moment as well, and then more to come here. He runs one of the largest ad agencies in the country, martin sor sorrell. Sorrell. You need a permit. To be this awesome. And you. Rent from national. Because only national lets you choose any car in the aisle. And go. 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Then expanded . Or their new product tanked . Or not . What if they embrace new technology instead . Imagine a companys future with the future of trading. Company profile. A Research Tool on thinkorswim. From td ameritrade. Crazy, crazy market. Again, well point out. Art cashin, the dean of the floor guys here at the new york stock exchange, and he came over to us when the market was around here. This is the nasdaq today, and he said watch 3985. That will be the support level, and if we can hold that, we may be able to hold this market here. It went down to 3986 and change and bounced back, and now were positive and continuing higher as we go into the close. Biotech has been calling the shots today, as we pointed out. As far as nasdaq goes, the ibb, one of the etfs weve been following here, tick for tick bounced off its low and trying to turn positive here as we head towards the close. Bob pisani and bob gelfon join us, longterm investor, do you like biotech . Is that a longterm sector you like . We tend not to focus on particular markets, but i think theres still a lot of risk coming into the market as long as we avoid any catastrophes or in ukraine or china or anything like that, so i think that will have all the high data names. Boy, you really are macro, arent you . Very macro. I can see that. On the micro level, what about what were getting here, bob pisani . The only point i would make is the volume has been on the light side and what weve seen heavy volume, ibb, very heavy volume, a little bit concerned that the other Market Leader, airlines had a great year. They also rolled over in the middle of the day and thats a Market Leader you cant say is overvalued. See that on biotechs. Im a little worried about that. Other than that i guess the question is what of what inning of the biotechs are we in, some say the fourth inning, some say sixth or seven, even though they are down 20 , they are still on the downside. Still a debate going on. Today, given the light volume, a little disappointing we rolled over in the middle of the day. Spring break, youll get that kind of volatility and volume. Retail sales were excellent. There was no particular reason for a big selloff. I thought it was time for a bound. Thanks for joining us. Bob pisani, well see you later. Were heading back to the highs of the session for all the major, average. What a turnaround day. What does this mean for tomorrow . Stay tuned for the second hour of the closing bell with kelly evans and company. Ill see you tomorrow. And thats the closing bell, and im kelly evans. Welcome, everybody. Heres how were finishing up the day on wall street. Looks like stocks made a comeback after last weeks sharp selloff. Weakness late in the day. The dow adding 146 points at the close. Thats almost 1 , the nasdaq adding 22 after being down to 39. 85, as we said, not more than half an hour ago, and the s p 500 adding 15 points to 1830. Now lets get straight to it. With todays panel. Joining me now is no, im kidding, Shaquille Oneal has left the house, Anthony Scaramucci is here, elan here from the Washington Post. Finally found someone at all. And congratulations to the Washington Post on their pulitzer prize. Fast money contributor jon najarian in the house along with our own Robert Franks and fast money trader brian kelly. Welcome, everybody. We have to take a second and pause, dr. J. , and figure out just what happened. Did we learn something from the sharper balance off the lows . Sglerlier i was talking about it being a don draper market from mad men, just as it ended, not going to be a spoil, but as the music went out hanging on was the song, and hanging on, thats what the market did last week. Fact we were able to hang on again today, and weve got loan servicers just screaming to the upside here. Drillers, offshore drillers doing exceedingly well. Theres a number of sectors, you mentioned biotech already, and a nice vshaped bottom that that put in. It looked like it gave up the ghost and it looked like it was heading south in a big hurry, turned it around and the nasdaq got back over 4000 as well. Those were all big positives. We just put in the lows here for a while, what do you think . I think well probably head lower than where we were, but i do think theres a conversion going on in the market right now, as we transition from a liquiditybased bull market into what i call a fundamentally based one. I like that. The last leg of this story is not done yet, and this market is going to trade higher. Liquidity to fundamental. Yeah. Heres the interesting thing about the action, robert frank. Well talk about this all week in, fact. Why is it that were seeing some of these wacky correlations . Why is it parts of the market are getting hit so hard. Is it kind of what anthony is talking about . Do you think were making that transition . But if it happens successfully, it will really be the First Time Since the fed embarked on this whole quantitative easing, wont it . Impressive the way this rotation has been fairly calm and strategic. Sort of Surgical Strike as opposed to carpet bombing, but i was surprised this morning that very few people seemed to be concerned about what happened in the ukraine. I saw that news this morning i saw that the u. N. Security Council Meeting yesterday and what looked like an emerging crisis, and i just thought this would be a bad day in the marks, and its not, and the other thing thats interesting. Weve now had two homes sell for more than 100 million in the United States in the past month. Thats never happened before. Oh, my gosh. Lots of factors that are kind of outliers, which means theres a lot of competent cap toll at all out there. Means something. Elan, i want to get into that for a second, but, first, in the last three, four trading sessions, news that jobless claims hit a sevenyear low and todays retail sales report wasnt strong for march. February, one of the month of the cold shocks, was higher, so to anthonys point it supports the idea that perhaps the u. S. Economy will pick up some momentum. One thing i found really encouraging, not just about consumers, but also when you look into the details, we saw the Home Furnishings sector up, building and garden material up and you saw auto sales actually very strong, and theres a very strong correlation between light truck sales driving the auto sales and Housing Market, and so what im hoping for is that youre not only seeing the Consumer Market pick up but theres relation to the Housing Market and well see some interest there. To Roberts Point there about ukraine and sort of the situation in the emerging markets. One thing weve heard last week is that emerging markets are now more concerned about fill back rather than fill over. Fed policy may not have effects on emerging markets but how the feds withdrawal of its easy money policies will affect the u. S. Economy and if they mess up there, that could have broader impacts for not only u. S. Are always getting whipped around by the capital flows. B. K. , what do you buy here . Nothing. I dont think you have to run out tomorrow and buy this market. Weve had one good day here, up 150 points on the dow. I mean, im not sure what markets you guys are trading over there, but this has been a pretty crazy rotation. Biotechs have gotten killed. All the high multiple stocks down 30 , 40 , 50 . This has been pretty wild so it will take some time. Fairness, bear market from the ibbs, off 20 from february 25th but the question is was that it . Was that it . Did we just see the move . I dont think we know yet. And this is a real important week. Well see how the market reacts to better economic news, because, remember, part of this big selloff started when we actually had better than expected jobless numbers so the markets started about are they going to raise rates too quickly. As the week goes on, cpi tomorrow, thats a big number. I dont think you have to just go all in tomorrow and pick that absolutely pinpoint top. But brian, over the next six month, the federal Balance Sheet is going up possibly as much as 600 billion. Do you think this market is really going to trade down with the fed increasing its Balance Sheet by over half a trillion dollars . I mean, we all know that thats happening. Do you think the market is going to trade down . If people think that the fed is going to raise rates quicker than it already priced in, yes, this market will trade down. And that is whats interesting to watch in some of the commentary after the retail sales report so maybe looking at a 1 to 2, maybe better than a 2 for the First Quarter of gdp. Elan, its what barclays thinks the rate is going to be, september too aggress sniff. The important thing the fed is not changing its reaction function but to the extent the economy is improving they have to put that reaction function into place. Right. So if the federal moves more quickly because of an improving economy, that is a good thing at the end of the day. Dr. J. , what are you buying here . A lot of those names that i talked about already, loan servicers. I was heartened last week and did buy nsm. As far as in that space i think a number of them look very attra attractive. Leaf looks attractive as well. On the list, looks like lps, asps, i bought rig, esv and Diamond Offshore. There were a whole bunch of stocks that i was buying, especially on the little bit of a dip that we had in the last hour. Able to get a lot of these stocks at better prices into the close. Is that a fundamental play, or is that kind of a positioning play . In other words, a rotation, or belief in kind of the story that they are there for the longer term . We sort of had very strong activity in shale plays this morning so i went for a lot of those early on, and then as they rotated from those, as they kind of got extended pretty good, a lot of folks went after, like i said, Diamond Offshore or transocean or rig so i scrambled into those. My question for you guys. Do you see any value in the biotech, in the tech . I mean, are there any buys here in this carnage, or do we just not know what the bottom is for these stocks so you dont want to catch them pulling off, or even the emerging markets . I would stay away from biotechs specifically, some lower tech stocks that are okay, dow chemical, pepsi, sothebys, aig are all being activated by shareholder activists, particularly on the hedge fund sides. Those names will power up over the section six months. An activist play to some extent. The fundamentals, abilityvism, cash on the Balance Sheet, and do i think the economy is getting better, and youre seeing a rotation away from people who have traded this market based on liquidity, and now youll see people really be stock selective. This is a little scary to me that very few people on our air or elsewhere are talking about value in the carnage right now, and that just tells me at least in biotech, tech and the high fliers hand momentum side we could still go down a lot more. So much of the discussion is about positions, people potentially getting wiped out in the hedge fund space and that sort of thing. How would you describe the last couple of weeks relative to the last 10, 15 years, how serious is it . I think its been painful, but i dont think its super serious. A lot of people have been hedged better than you would have thought. If you look at the long shore portfolios, kelly, they are doing okay, and we track about 1,200 of these names. I think as the fed pulls out better for the Hedge Fund Managers, particularly the long short guys and frankly their shorts will start to work better in that environment. They have worked in the last six weeks, but in the last five years they really have not worked, and thats been the real issue for the underperformance in general in the hedge fund industry. Thats a good point. Thanks, guys. Leave it there. Thank you, brian. Catch hip am the rest of the fast money crew coming up at 5 00 pl. I mentioned we have a market flash. Lets send it over to dominic chu. One of the moment mum names, tesla down nearly 3 , closed today, closed below 200 bucks a share for the First Time Since february 19. Remember though, this is a stock thats still up 31 this year, and thats after a huge gain in 2013, and on another front here, related but not really, elan musks space launch was scrubbed due to an unnamed technical issue. Space x is cancelling its scheduled flight for today. Kelly barks back over to you. Stocks rebounding a little bit today, but the major averages are still blown away by the performance of emerging markets this year. Are you better off looking overseas for better opportunities or keep it home in the u. S. . That discussion next and they say death and taxes are the only certainties in life. Uncle sam will come calling for the latter tomorrow. Higher tax bills have been a major factor in the markets weakness and sticker shock at the grocery store. Beef prices hitting the highest level since, yes, 1987. Well tell you whats behind the price spike and if theres any relief in sight and how will that affect your summer barbecue plans. Keep it right here. Youre watching cnbc first in Business World woide. Ness worlde with frontwhe d elrive. You are feeling powerful with a 4cylinder engine. [ male announcer ] open your eyes. To the 6cylinder, 8speed lexus gs. With more standard horsepower than any of its german competitors. This is a wakeup call. [ male announcer ] when fixed income experts. Work with equity experts. Who work with regional experts. Who work with Portfolio Management experts, thats when expertise happens. Mfs. Because there is no expertise without collaboration. Welcome back. Heres how we finished up on wall street, this despite the crisis in ukraine heating up again. Pentagon correspondent Jim Miklaszewski joins us now with the latest. Jim . Reporter most troubling developments over the past few days occurred in Eastern Ukraine where bands of prorussian civilians ostensibly stormed several government buildings and police stations in about three Eastern Ukraine cities. Now, according to samantha pours, the u. N. Ambassador from the u. S. , she claims that this was all orchestrated, organized, planned by the russians suggesting that if those three cities were to fall into chaos that would be an excuse for the russians to invade so in this case its loselose for ukraine. If they sit back and watch, they risk losing a big part of Eastern Ukraine. If they take proactive military action, they risk an invasion from the russians, and also today a russian aircraft, a russian fighter jet buzzed a u. S. Destroyer that is on maneuvers there in the black sea and has a show of support for ukraine and the rest of the baltic states. The plane was unarmed, made about a dozen passes while the pentagon calls it a provocative unprofessional act. They are trying to play down that incident, but in the most bizarre development, the white house today acknowledged, admitted that cia director john brennan made a secret visit to kiev over the weekend under an assumed name. The russians picked that up claiming that this was obviously the cia working hand in glove with the ukrainians to come up with some kind of military strategy against the russians. Jay carney, the white house spokesman, called that charge absurd and claimed that they were just sharing intelligence, information and tactics. So over the past few days a lot of smoke, some fires, but people in this building are keeping a close eye on all these developments. Kelly . Yes, as is the rest of the surrounding region. Jim miklaszewski, thanks so much for us at the pentagon this afternoon. Despite this unrest, investors are returning to emerging markets and to the tune of almost 2. 5 billion. Thats according to fund flow data, the beginning of april marking the first time money has poured into the funds since last october. Have investors regained their Risk Appetite for emerging markets . Joining us now is simon hart from blackwell. Headlines in from ukraine has people on edge and what about emerging markets, are they holding up . Emerging markets are a way to look for opportunities. Weve avoided it for many years but have changed and evolved our view and found good Hunting Grounds in emerging markets. We shouldnt be so quick to lump them all together. Russia being one of the original bricks and today when most people think emerging markets are thinking china, india, those kinds of places. Where are you . Turkey, india, the brazils of the world are still, you know, in a tricky situation economically, but they are probably where europe was two years ago. In fact, in some respects they could be better positioned on the periphery, and were looking at some of the markets and finding some opportunities, especially in mexico, with Companies Like semex which are recovery plays, both domestically and u. S. Infrastructure plays. I would imagine they benefit from some changes, major mega mergers going on in that space, could reduce the number of markets. They have been struggling with a large debt load and that more or less cleans that up which gives them scope to take some of the assets over the next year or so. As you go back into some of the fragile five markets, some are called that because they are running current account deficits and they will rely on the external financing. That could make them vulnerable again when the tide goes back out. How long term are these investments going to be . I think you have to pick your stocks carefully and note fundamentals very well so you can deal with the volatility. Theres no doubt that the e. M. Will be volatile over the next year or so. Three elections coming up in, brazil, india and indonesia so well get volatility, but i think thats more likely to be taken advantage of from investors like myself. And were seeing this in the slow data. Interesting to hear you say some of the markets is where europe was two years ago and some are saying europe is where the u. S. Was two years ago. If what youre saying is the case, were talking about a five year, 200 , 100 raly. Right. Do you think the opportunity is quite that clear at this point . Not yet, still a little bit early, but im a stock picker at heart so i prefer to look at individual opportunities, you know, try and monitor the risk politically and economically and make sure the valuation is correct, and then i think you can live with them. Picking up any names in russia, eastern europe. Not particularly, mexico, picking up names in the last few years. Does that have to do with the political change . The election calls are very inact rat in india given the large population, but then the market is already run up ahead of the election but if it comes back and modi is elected thats a good Hunting Ground for opportunity. Chinese financial, dabbling there . Some of the stateowned entities are attractive, petrobras in brazil is very attractive. Its funny you mentioned brazil, the subject of of page 1 treatment again over the weekend in terms of the infrastructure, White Elephants they have built. Will they be ready for the world cup and the olympics in two years time . How relevant are those factors when youre picking stocks . All relevant because you have to deal with the volatility. At the end of the day know the valuation and what youre paying for the business you can live through the volatility and treat it as an opportunity to buy more. For investors to deal with the headline the headline risk, shall we say, there and everywhere for now. Nigel hart, thank you very much. Appreciate if. Uncle sam wants you and your taxes, why tomorrows april 15th tax deadline could be a major factor in the markets recent weakness, plus why does he head one of the Worlds Largest advertising firms right now and want the company to be known as a data provider . Wpp ceo Martin Sorrell will join me live coming up on the closing bell. Closing bell. A. I dont even know how to answer that. I mean, no one knows how long their money is going to last. I try not to worry, but you worry. What happens when your paychecks stop . Because everyone has retirement questions. Ameriprise created the exclusive confident retirement approach. To get the real answers you need. Start building your confident retirement today. Time to take care of business with century links Global Broadband network and cloud infrastructure. We constantly evolve to meet your needs every day of the week. Welcome back, so april 15th, the tax deadline is tomorrow and with higher tax bills how many are taking profits to pay off the bills and how many are reusing or investing their tax refunds into the markets . The panel is with us to weigh in on us. Mark, how much of a factor is taxrelated selling in the marketplace latest weakness, do you think . Well, i think that plays into part of it, shelly, and in fact over the last few weeks ive carefully looked at my clients portfolios as i always do in a taxmanaged approach, in a very efficient way, to see where we could harvest losses and then also take some gains, but at the same time have the money ready, the funds to wire based on the advice and instructions from my clients accountants. So, in other words, they are just moving the money around, its not coming out of the market . Well, it is coming out of the market, and in some cases many clients have significant cash on the sidelines, working mostly with High Net Worth and some cases they are moving money from cash that hasnt been invested, and in other cases were selling and began selling at the earlier part of april when we had a better feel from the accountants as to what our clients needed to to owe the irs. We had some guests last week suggesting that the market is going to rally on april 16th, as soon as this is all past us. Do you buy that . Not really. Very skeptical of the whole explanation that the markets would turn down because people are selling their stocks to pay their taxes. Started to speak to a lot of advisers like mark. A lot of people, a, are surprised how little liquidity the wealthy actually have. A lot is in assets that they want to grow, and you have a double whammy on the tax front, higher tax rates which seem like a long time ago and coming into effect right now, plus all of the great Capital Gains from last years 30 market increase. They have have to pay those in april as opposed to being deducted. So a lot of the wealthy im talking to are suddenly looking at their tax bill today and over the weekend saying oh, wow. They wait till the very last minute. Absolutely. The value of money. Time and money, so they are just looking at it over the weekend saying i would rather not give cash. I want to save that on the sidelines, rather take some out of already an iffy stock market. Anthony, what say you . You know, definitely some of that. I think most of the tax stuff happens at the end of the year planning into the next year. Right. But i think that the bigger issue is not the tax driving the sales, but its the overall tax and the dampening effect that the taxes have on the economy. Lets just face t. Taxes are a price. When it goes up, it slows peoples demands down. Just that simple. Could be part of the First Quarter, but certainly seems like the latest reports point towards strength, that the Economic Data is looking a little bit better. I do think taxes are helping the deficit. Massively. Theres a tradeoff on both. Im not here as a tact activist. I have a question for you about one issue thats very big in washington which is paying for the Affordable Care act and medicare surtax that went into effect for the 2013 tax season. Is that an issue for your clients at all, and how are you seeing that impact they are planning on paying their taxes . A topic of conversation ever since we know they would be paying for that but clearly not an issue. The bigger issue is that they are paying more taxes at this time of the year than they have in recent years, and they are beginning to become even more concerned. Until they see the meaning leaving the account, they are really not as vocal as they are. Its all theory, but once that money starts to get wired out of the account and they hear from their accountants, directly from them or through me, then its a big surprise and theres a lot of discussion and obamacare and Everything Else thats related to their higher tax bracket starts to come into conversation. Keep in mind for the top 1 , they are seeing 40,000 more paid per taxes this year on average than they paid last year. Thats a lot of money. 40,000 to the 1 is like not even how many decimal points. Its a lot like this, at least for our clients, and we saw the bulls and bears fight to a draw going into the end of march, and they basically have that twoweek period up until, you know, last friday really to get the money ready so that they can wire it out or put the check attached to the irs because we, of course, despite filing for an extensi extension, you owe the money now, so the fact that they fought to a draw, bulls and bears, now they owe the taxes we thought could have some impact. Not significant, but given that the market was hitting bids. Right. And people were getting out. Yes. People were forced to basically accelerate the selling to get out and to go to cash, so that they would have the money for taxes. We thought that that was a contributing factor. Not the reason we rolled over, but a contributing factor. To emphasize johns point. The people who have capital frankly are the wealthy. Look at the top 1 , according to the National Taxpayers union. Top 1 is paying 36 of the income taxes in the United States. Thats going to keep going up. That will go up and will have an inpact on the stock market. It has to. And theres psychology. A lot of that taxing is Capital Gains taxing. What about research . Robert, you wrote a story about this that shows the more money people make, the more willing they are to pay more in taxes. Yes. But basically was that point from the Obama Administration . But the reality check there is they still, everybody wants a tax rate thats lower than what they currently pay. Mark, what do you happen april 16 . I think the market continues to climb higher, to be perfectly higher. Once investors get used to the fact that the money is gone and they are living with a reality in a higher tax environment, we get back to doing what we do best and thats making money for our clients. The loss drives them to make a bigger profit. Thats interesting. Thats exactly right, and its behavioral. That money has to be earmarked for tomorrow. If its not, you start paying interest and affluent clients, any clients dont want to pay interest or penalties later in the year. Lets not forget they are also making estimated quarterly tax payments for 2014 starting now. Yeah. Thank you, mark. Thank you, kelly. Fascinating. Youll all be fired up hearing one story lighting up cnbc. Com today, about a Hedge Fund Manager beating the system, the subway system. That story with the cnbc. Com hot lies coming up next. Lies coming. Honestly, im pouring everything i have into this place. Thats why i got a new windows 2 in 1. It has exactly what i need for half of what i thought id pay. And i dont need to be online for it to work. It runs office, so i can do schedules and budgets and even menu changes. But its fun, too with touch, and tons of great apps for stuff like music, cause a good playlist is good for business. I need the bosss signature for this. Im the boss. Honestly i wanna see you be brave one story heating up the hot list, a hedge fund maven who didnt move when they found scamming the system. Youre european burro set it up quickly. Everybody is reading that one. Hedge fund manager over in london, apparently for five years had figured out how to do subway transfer arbitrage on the tube and basically figured it was cheaper for him to pay the fine for not tapping in with a ticket to enter the system than it was to pay the full fare . They finally cat up with him and said, hey, you owe us big time and did it in like three days. Nothing to him. Still, really, anyway, people love that story. Also concerned in some of the more serious stuff, a market writeup that we have, looks at three factors, sort of responsible for the turnaround today. Basically the citigroup earnings, retail sales and some mellow dovish sounds out of europe. I want to know which of those happened at about 3 47 p. M. Sort of playing it more. Hedge fund guy give anybody cancer . Anthony scaramucci wants to know did he robert frank, your story is doing dynamite on the website right there. Got at least 400 people at a time reading it at any given moment. Put taxes and rich in the headline, its gold. Is it the case, while i have you both, the cutoff for income. For individuals its a little bit higher for couples. But whats important here is that even individuals making 250 and couples making 250 are affected because its again those health cared aones that come into play this year. Wanted to apologize for my cheekiness, to those folks 40,000 would be a big deal and i can understand the hit that that would have on their allocation decisions. Back to the Hedge Fund Guys causing cancer and jumping over turnstiles in london. The british just assume that no one would ever cheat, why would you . Why is the fine for not paying a ticket . In britain no one is going to cheat. Thats not necessarily the case. Most people who dont have the money wont have the money for a fine. No point in making it that much higher. Wondering if its a store clerk, how big that store would be. This just tells you contrary to recent commentary the banker hedge fund bashing isnt over yet and it reflects the times. You have to acknowledge that. Some of it is well deserved and some overbaked. If you improve your returns it would be a better number. The Hedge Fund Community broadly. Im not allowed to talk about the returns on the shelf but were doing fine and i want to thank our clients for that. Theres a reason theres 11 billion. And thats because hes doing well. Thank you, john. If you feel like your grocery bill is growing. Youre not alone. Tight crop supplies are to blame. Are farmers planting enough . That story next and a major beef over beef prices because they are now selling at levels not seen in 28 years. We want to know if and how they will impact your summer barbecue plans. 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Just a tap away on the geico app. At your ford dealer think . They think about tires. And what theyve been through lately. Polar vortexes, road construction, and gaping potholes. So with all that behind you, you might want to make sure youre safe and in control. Ford technicians are ready to find the right tires for your vehicle. Get up to 120 in mailin rebates on four select tires when you use the Ford Service Credit card at the big tire event. See what the ford experts think about your tires. At your ford dealer. Welcome back. Jackie deangelis joins us now with a breakdown. Enough to ease the crop supply crunch, jackie . Good afternoon, kell de, an interesting question. The usda recently revised its estimates for last year for 2013. This is an important report, the first one looking forward that will tell us whats happening to prices as we move forward and also what will happen at the supermarket. Corn plantings occurred at a pace of 3 so far this year. That is in line with consensus estimates, but keep in mind that this is well below the fiveyear average of roughly 6 , but, still, analysts are staying its very early and we need to watch this closely. Weve seen planting issues early on in the season before, and we have been able to weather the storm, pardon my pun. The usda said 34 of winter wheat was in good or excellent continue, in line with seasonal norms, so that was good news as well. Whats interesting here though is beef prices are at their highest levels since 1987. Thats because less corn last year meant less feed for cattle. That brought beef supplies down, so couple that with an increase in export demand and weve seen beef prices up about 25 cents since january, and analysts are saying there could be more hikes to come, of course, just in time for grilling season. Kelly, back to you. Jackie, thanks very much. On that note we want to ask how rising beef prices are impacting the consumer. Ed to simon joins us now. Senior Vice President as omaha steak so if anyone is sensitive to any change in beef prices you would. How big are we talking here . You know, weve seen prices pretty much in line with what your Previous Report said. You know, one of the interesting things about the beef business though it goes up and down intramonth and intraquarter so there are still a lot of opportunities if consumers are keeping their eyes open to take advantage of lower prices when there are opportunity . Right, so if were talking about a 28year high, are you seeing already a substitute to that, people looking for other products . You know whats happening there, theres also a shortage in the pork market and the poultry market hasnt really caught up so the entire protein complex will see some higher prices this season. One. Things were telling consumers to do is watch for sales and stock up . Yeah. I wonder though, you know, if were seeing, you talked about the protein complex, are you seeing the rotation on the other side thats hurting beef prices where so many people it seems are shifting away from red meet towards white meat, fish or chicken, is that kind of offsetting these cost pressures on the upside . Weve seen in our business at observing had a steaks, weve seen consumers are buying beef but they are also buying the poultry and seafood items that we offer as well. We havent seep a tremendous shift. Im not sure i can comment on that but maybe some of your experts have an idea. Are you seeing that, dr. J. . I swore off for lent red meat but ill be right back in there for omaha steaks on sunday but up until then ill be on the sidelines, kelly. The question i have is theres no Wage Inflation. Right. So when you get Price Inflation in any product without Wage Inflation it hurts demand but omaha seems to be at the top end of the scale. You guys have a terrific product. Is it just the group of consumers that you guys are targeting . Well, its not necessarily that were not feeling it. Its just that really what were seeing is consumers emphasize quality over quantity, especially when prices go up. When prices go up, they want to get the good stuff because its not such a big spread between the good stuff and average stuff so were seeing continued demand for high quality beef and were also seeing a shift away from people eating out to people eating at home which provides a much more economical way to eat the best Quality Foods you can buy. So i think those two together have really tried to keep this business on track . Interesting, todd. How much have you increased prices here. Can you give us some examples. Well, we do we make a big effort to try to keep prices fairly tent year to year, and the way we do that, you know, we buy brief and produce it and since we sell frozen beef were able to put it into the marketplace in a more consistent way, so, you know, weve seen prices go up and down a little bit on average, but its not more than lower singledigit percentages. What youre saying is because prices have been volatile, even at 20year high, you have a stockpile thats going to see you through this period. Now, i would imagine that that means that you expect the volatility to stop. What happens if thats not the case though . Any possibility that, you know, cattle shortage, weather changes, what have you, could make this a bigger effect for you in the months ahead. Those will always affect the business, and, you know, our goal is to really do the very best for our customers so what we try to do is offer great value assortments, those are always available on our website and it gives our consumers a way to stock up and take themselves through the whole Summer Season without seeing tremendous volatility. Thank you, todd. Thank you. Appreciate it. Beef prices heating up, will you skip the steak and hamburgers for your summer barbecue in favor of Something Else . Wont believe what the panel has to say about this when we come back and also want your take. cnbc is how to reach us. Back in two. Back in two. [ tires screech ] chewleys finds itself in a sticky situation today after recalling its new gum. [ male announcer ] stick it to the market before you get stuck. Get the most extensive charting wherever you are with the mobile trader app from td ameritrade. Theres a look at live cattle prices. Amc shares are dropping today, after last nights season premiere of madmen, came in below expectations. In fact the season had its lowest season premiere and brought in only 2. 3 million viewers. Shares just fractionally lower. The industry has changed since the days of don draper. No one knows better than wpp ceo sir Martin Sorrell. Good to see you on the new set. This applause has been around, as has wpp. How much disruption is there in the ad market thanks to the players like buzzfeed . I wouldnt sort of highlight buzzfeed beyond anybody else. Start with google and facebook and twitter and instagram and pinterest. I mean, buzzfeed has some implications in terms of a news feed but if you look in a mad men sense, don draper sense, he wouldnt recognize 75 of our business, revenues 18 billion, if you include associates, 29 boston of 21 billion and 4 billion is in Media Management and investment, Media Planning and buying and 5 billion in data and 6 billion in digital, so thats about 15 billion out of the 18 or 21 that is accounted for by things that in don drapers era really werent significant as that. Classic creative in the draper sense is probably about 4 billion. But is it the point, not necessarily the point, advertising still at its core, a creative conclusisolution to maa product . No, theres a lot of things that we change. When you phrase that question you phrase it in the sense that the only people created are the people in don drapers creative department. Even financial drapers can be creative. Creativity rests in media departments. In planning and buying. It rests in digital departments. It rests in pr and branding and identity and health care communications. Obviously in the whole world in display or mobile or social or video. So creativity is a much broader context and concept than don draper ever envisioned. Phrasing the question about creativity, we do strategic thinking, creative execution and distribution. That has become more complex. Google is now our biggest media relationship. We have a 75 billion media book and our largest media relationship is now with google as opposed to history say with the news corp or cbs. Yes. Its more complex and via google instead of televisionch but you still have to create and district a message for a company do you not. You have to be careful. Google to me is a media owner. Same would apply to facebook and twitter. Because google sells google and twitter sells twitter. Its a bit like saying ill hand my media plan to 21st century fox. They have a vested interest in promoting their media. re agnos. Should it be 85 billion or 65 billion. Where do you disperse that . The truth is that 20 billion of, 20 of the worldwide media spend is now online and mobile. The other point is consumers spend about 1 3 of their time online and mobile. So still they have not achieved the custom that the consumer use it has. Newspapers and magazines take 20 of media budgets of the industry. But we know the consumers only spend 10 of their time with legacy media. So those two disconnects have to all thor overtime. Radio is about right. Those two big discontinue youties are the things that have to happen. Are you shifting any spend away from twitter, away from some of the social media sites having been somewhat aggressive and getting involved and seeing any sense of declining . No. I think they continue to be sexy and because of low absolute costs and because of the focus on reducing costs, most of the Companies Make their numbers by cutting costs and the rise of finance and procurement in opposition in many senses to marketing means theres a tremendous focus on cost and the advantage of online is certainly cheaper than the 30second commercial on the super bowl. 3 million a pop or whatever it is. People can say i can reduce my costs and invest in websites. But the interesting question, last week one client felt who i had an interaction with that the aura around online had become overblown. Generally thats not the case. Google went from 2 billion to 2 1 2 billion in 2013. If you look at our spending with facebook, it will be up to maybe 700 million or 800 million. And twitter is somewhere small but growing rapidly. These cans of communication, media are becoming more and more important and their growth hand progress will continue to develop. In a word i know this will be tough maybe three or four. Do you think that the secular decline in advertising prices owed to the proliferation of online media is ended . Do you think were at a turning point . It was not a decline in price. Price is up by about 7 or 8 . Mobile web based i mean . I think the fragmentation and the growing fragmentation is there will be new facebooks. Thats the 360 billion strong company. I think the increasing fragmentation will have an impact on online price. Keep it low for good . You could never say for good. We see with our zaxus platform that gives us opportunity to get premium inventory at a good cost. Sir martin, thank you so much for being here. Thank you. Always get to get your perspective on whats happening in the ad world. Get ready to grill. The summer barbecue season is fast approaching. How will sky high beef prices force you to change your menu . Your best tweets coming up after a quick break. Today is monday today, we greet you. 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With more standard horsepower than any of its german competitors. This is a wakeup call. Beef prices are on the rise. We have been asking how that will impact your summer barbecue this year. Tweeting this barbecue will not be affected by higher prices. I will not allow it. Jeff tweets, beef, its not whats for dinner with higher prices. Chicken and fish, fair game. My cat loves those meats. Anyone here changing their barbecue plans . No. Anyone here barbecue . All the time. Do you . I usually do red meat but switched over to pork. All i can do is toast white bread. Thats about it. Youve got to have a bacon for that blt. Final thought. Robert . Look, im interested in what happens with other Asset Classes this week. The real estate. Im going to see the money coming to the u. S. Goes away from stocks. Dr. J. If they continue to sell in to any bounce to the upside then theyll get caught short. The Washington Post, Public Service and to elie for reporting. If that is still in the game, stay long in the market. Thank you. Its been fun this afternoon. Fast money is coming up in just a few seconds. This use twitter is coming. We have no plans to sell. Our traders will weigh in the answers will surprise you. Guarantee it. All right. And martin says theyre still increasing their ad spend. Fast money starts right now. Outside of new york citys times square. Dan, brian, kelly and guy. Weve got the latest details in the battle between google and facebook. Over one drone maker. City, a wild day in the markets. Helping city have its best day since 2012 and the report lifting a number of the other financials higher. Karen, you have been holding on to citi and now its bounced . Its lower t