Transcripts For CNBC Closing Bell 20141121

Thats right. Several sessions adding points and adding eight. Talking about the effect of the stimulus and people at the same time talking about as a currency race to the bottom. Round number five or six i think we are on. Expiration day, too. May be complications. Art cashin saying the bias so far to the upside and could change. The dow up half a percent and the s p 500 sitting at a level unbelievable, 2061. A lot of forecasts coming into the year closing at 2014 was aggressive. Now the nasdaq up about 9 and underperformer on the session hovering around 4711. Less than 300 points away from nasdaq 5000, too. Getting there. Lets talk about it in the closing bell exchange. With us this friday, hank smith, john wilson, peter chicini, christine short and rick s santelli in chicago. The sugar rush didnt last long for the markets. What happened, do you think . Well, you know, first of all, keep in mind, we have had a sugar rush going on and we pretty much cut the pattern with regard to quantitative easing and not surprising that, you know, the european markets did a bit better but i do think that embedded in that is a very interesting notion. I talked about it a great length today that capital flows potentially into the underdogs like the european economy and underdogs referring the state of the economy from a true fundamental Vantage Point is going to get outweighed by the liquidity so the capital flows could be moving out of the u. S. And various sectors. I dont know that anybody is anticipated that. It could do things but the fixed income market looks like the effect early on but its not. It looks to close between 230 and 238 in 10s and the 30year bond up to 32 days between 303 and 310 and breaking under that range. So i think maybe it might have siphoned off on the equity side a bit and looking at the spread relationship at 14year wides of a boon and a 10year. Unbelievable some of the levels of the european bonds. Let me correct something i said. Im sure there were people yelling at the Television Screen when i said that the bank of japan cut rates. It was the peoples bank of china. We knew what you meant. You knew that but it didnt come out of my mouth. We want that to be right. Could have a lot to do with the bank of japan. If youre an asian economy and reacting to the yen and you have to wonder maybe korea or india might have to start thinking about a similar policy. John wilson, what do you think about the moves overnight we saw in central bank land and where it leaves the u. S. Semihere . Well, we are fiat positive on the u. S. Economy but when you think of people talk about with the fed potentially moving rates next year, the common line is thats a good thing because it means that the economys better. I think the converse is also true which is the bank of china not cutting rates in china because everything is rosy. They have a slowing growth problem and trying to react to that. Christine, you were mindful of the multinationals reporting earnings this past cycle and saying they were concerned about the slowdown in europe. Are you taking comfort or do you think they will take comfort from the actions of mario draghi this morning, as well . Yeah. Thats true. The concern of 25 of s p 500 companies that reported at this point have said europe was a biggest concern and you have to remember about 10 of s p 500 sales comes from europe so i certainly find solace in the fact that something is happening. I think the big question mark is, is it too little too late . Will it work the same way as the u. S. And i think Companies Take solace in this going into 2015 and takes time to come into effect but seeing, you know, big names such as johnson johnson, cola cola among those that said europe is weakening and a weaker picture for the Fourth Quarter, look at todays move and be sort of positive about the economy going forward. I wonder we put up the chart and have people take a look at whats happening here and we hit kind of a milestone. S p capital iq saying the estimate of Third Quarter results, hitting 30 a share. When you add up all the s p 500 stocks, they earned an aggregate of 30 a share. Exactly. A steady march as you can see since the recession. Two components to where its trading. Hank smith and then theres the multiple on top of that. Both of those are in expansion mode and do you think theyll continue next year . Well, look. I dont know how much more multiple expansion were going to get. You could make the argument that you could get maybe another point or two of multiple expansion given the low level of Interest Rates and inflation. But i do buy into the fact that the u. S. Economys growth rate accelerating, perhaps to the 3 range. That means corporate profits are going to inch up maybe to high single digit levels and that adds up to a good year we think next year for the market. On top of that, you have always had positive returns one year after midterm elections since world war ii, positive returns with years ending in 5 going back to 1835. The 5 again. The 5 indicator. And the third year of a president ial cycles a good one so no reason not to be bullish. Peter, if i read your notes properly, youre a little skeptical of the rallies here lately. You dont think the technicals are confirming this market here, right . Yeah. Well, you know, we sort of got ahead of the selloff in october by noting that nyse cumulative advance decline diverging of s p price. And were actually seeing similar divergences in breadth right now, continuing in the s p breadth. S p breadth itself. A divergence of russell breadth and price. Fewer stocks are going up than down. More stocks going down as the averages going higher here. Correct. Participation is flagging. Put it that way. What do you think is going on here . Are we setting ourselves up for a top here . Well, i very much think so right here. And i think todays actually pretty interest day from a technical standpoint and seems on a lot of charts including russell and the s p into very important resistance levels so from a technical standpoint, the way of the volatility surface looks, i see a steep skew with market tops. Im not all that bullish on earnings next year. Margins already at 10 on the s p. Thats very close to historical highs. Im a mean reversion guy. I think in cycle that is will tend to revert and moreover in terms of election cycles and 5year cycles and the other things, if the causeality isnt there, then perhap this iss just really strong coincidence that we go back and look at the data and make it fit the reality. Wow. Rick, how much further can the dollar move go and whats the implication for the u. S. Economy . Do you think its an equivalent of tightening of Monetary Policy . I think i stick with my baseline forecast that if you want to know how high the dollars going to go, just look at the yen and the euro. And i think in the euros case in particular theres more room. I think when it comes to the yen and china, i think you need to start looking at the way their two currencies core late and sticking with the 120 level and the dollaryen with resistance so i think that the biggest part of the 12plus percent depression yags of 2014 thus far is close to the biggest number to see for the rest of the year. You know, peter just threw out there one of the least bullish forecasts that i think we have heard in quite a while here. Thats true. Hank, christine, who wants to take the other side of the trade right now . He laid down the gauntlet, hes drawn a line in the sand for the market at this point. I wont take the other side. Ill say i think the multiple is more problems than the earnings. I think earnings, we think, are set up to do quite well moving into next year but you started the segment talking about the market is complete lly focused d the journey is qe3 is over and turning the language to be about rate hikes and i think that is a problem for the multiple. What are you buying here . Whats attractive to you . Sure. Lock. I think the markets been giving you an opportunity and a couple sectors with that big selloff back in october. Industrials where you had almost a bear market type of selloff so you can buy names like united technologies, like eaton, like general electric. That have that arent at the 52week highs that will benefit if were right about an economy accelerating and particularly if europe picks up with some quantitative easing and youre getting paid a better than bondlike dividend yield so youre getting paid while you wait. Thats a nice combination. All right. Got to go at this point, folks. They all for joining us. Have a great holiday, as well. See you later. Thank you. Mega terrell is covering the moves for us with something of a faded rally, meg. Hey, bill. We begin with dow chemical, the company agreed to add four independent directors to the board as part of an agreement with the Third Point Hedge Fund avoiding a proxy battle and trading up 2. 3 and caterpillar higher, as well. Steeple began coverage with buy rating. Now trading up about 3. 7 and petrobras is on the rebound. Dow jones citing the brazilian media saying the top con tenners are market friendly. Trading up about 12 on the flip side, aruba networks, falling after the revenue guidance below street views. The stock trading down about 13 . And we end with intel losing ground after clsa downgraded the stock a day after the investors meeting saying guidance for growth was too optimistic. Back the you guys. All right. Thank you. And that caterpillar rally helping the markets. Dow up about 82. Still looks like were going to go out on a strong neote here. And it was the bank of chinas surprise rate cut that fueled the early rally today. Will chinas move slow down what our fed might do when it comes to raising our Interest Rates . Steve liesman and chief economist mark zandi taking that topic when we come back here. Speaking of the fed, rhode island senator jack reed wants to make the head of the new york fed a president ial appointee subject to Senate Approval and speaks with us exclusively coming up. Dont go anywhere. trader vo i search. I research. I dig. And dig some more. 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In part maybe large part to the easing that occurred that we had the Interest Rate cut by the peoples bank of china overnight, the quantitative easing by the ecb this morning and our market was up 176 points on the dow but were well off that high and record territory for the dow and the s p and the nasdaqs at a 14 1 2year high right now. Stocks initially jumped on the news of that. First the china rate cut. First cut in over two years. Was our Federal Reserve paying attention . Well, will janet yellen raise rates . Joining us is mark zandi with our very own steve liesman. Steve, why dont you begin here . Well, let me start with some news we got. Citi sending out a note saying that theyve pushed ahead their date for hiking Interest Rates from september 2015 and they were already late and now theyre in december. So i think theres an effect of what were seeing and hard to know because other Central Banks are easing further or because of concern about Global Economic weakness . Were starting to hear that. I think the way to think about this is the fed is okay walking point on patrol but it doesnt want to be too far ahead of the rest of the squad. They were ahead coming to easing and i think theyll be ahead coming to tightening and not too far ahead. Mark, what do you think . Janet yellen said its data dependent when theyll start to raise Interest Rates. But the question now is, whose data are we talking about, ours or europes and asias . I think it is ours. You know, i think it is all about the u. S. Job market. If we continue to create jobs at the current pace, 225,000 per month, labor market will tighten rapidly and start getting substantive wage growth and then i think that matters. Thats the catalyst for a rate hike and i think june is much more likely than december and events overseas matter but they have to have big moves overseas before they matter in a significant way to our economy and to Monetary Policy so i think its all about our economy, much less overseas. Im glad you raise this issue of wages, the one everybodys watching closely and perhaps now another wrinkle. I want you to listen to what jason furman had to say yesterday on this topic of the president s move of immigration and some believe will keep wages down. I asked the chairman of the council of economic advisers. Take a listen. Is it probable in the near term to depress wages on the low end of the labor market . No, i dont believe this would happen. We did a massive experiment on this. It increased the labor force by 7 in miami with lowskilled workers. Economists didnt find an adverse effect on wages of workers there. If anything, they went up as the new people helped the economy complimented the work. Mark, do you agree with that view if anything this would be a net positive for wages or will it at least near term put Downside Pressure on that part of the labor market . No. I think he is exactly right. Most of the executive action that was taken last night by the president centers around helping to promote the immigration of more skilled highly educated workers and theyre going to be entrepreneurs, innovators by risk takers from their country to our country and more jobs and more demand. No. I dont think it depresses wages. Longer run, immigration is critically vital to our long term growth. If we dont have immigration and more immigration and highly skilled immigrants, the Growth Prospects dim. Take a look at japan and europe. A big difference of going on there and here is significant immigration. What do you think, steve . I think thats right. If im not mistaken, most of the people affected by this probably already working in an illegal fashion or some fashion not on the books and i dont think thats a net addition to supply to the labor market here but i wanted to disagree with something mark said and i know this is against the theory here. I believe that americans want to work and want to work in greater numbers than theyre working now. Mark, i could see this strong job growth continue with an extended period of without wage gains. We have been sitting here calling for the wage gains year after year and we have been wrong and maybe its time to give up the ghost on this. I think theres a vast and vaster pool of labor slack than those worried of wage gains are willing to admit. I think the Participation Rate is lower than it should be and will be and i also think the millions of longterm unemployed and i believe these people come back to the workforce they will exert downward pressure on wages. Mark . Yeah, no. Reasonable debate. I mean, i do think theres still considerable slack in the labor market and a reason is you have people that stepped out of the workforce and will step back in with more job opportunity and wage prospects do begin to pick up. Right now, best guesstimate says 1 to 1. 5 of the labor force and assuming stronger growth and absorb it over the next year or year and a half and starting to see signs of wage pressure and, you know, ill take a bet, steve. Next spring, lets pick the month of may, by the month of may i well concur that theres been a definitive acceleration of wage growth and feel it in the labor market. You can feel it . Id be happy to lose that bet. I can feel it. Steak dinner on the other end of it. Buying or receiving. With a good bottle of wine. Big on corn bdogs on this show. Time to update. A little class on the show, griffith. Those are classy. In brooklyn. The original premise before you go. You seem to suggest even with that kind of wage growth we would not see the fed raise rates sooner than later because of overseas, as well . Thats a part of it. I think janet yellen wants to run the economy hot an i think thats something that is a matter of judgment, whether or not she can end up allowing that to happen, i think she wants to do catch up in wages. We have had wages running below productictivit productivity, inflation. Zero to negative over a period of time and a pickup recently and inflations come down and i think janet yellen would like to have workers be able to have time to fake up whats lost and not inflationary. Theres pressure and people screaming. The fed behind the curve and yellen will say, exactly. All right. Well see. Thanks, guys. Thank you both very much. Have a good weekend. Steve, were sending you a corndog. With them, if you use the grey poupon mustard, it can be a classy dish. 40 minutes to go. And 82 points higher on the dow where we stand. Look at that. Just barely back above i shouldnt say back, only today were trading here. 17,800. That level keeping an eye on and the s p adds almost 10 points on the session. Just as were getting used to gasoline under 3 a gallon in many parts of the country, will opec cut production next week when they meet . Plus, a new way to invest in china, Exchange Traded fund manager talking up a new china etf focusing on bonds and who should be invested in this right now . Well talk about that coming up. Stay tuned. Mpetition 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. Mheres our new trainer ensure active heart health. Heart im going to focus on the heart. I minimize my sodium and fat. Gotta keep it lean and mean. Pear uhoh. Heart i maximize good stuff like my potassium. And phytosterols, which may help lower cholesterol. Major im feeling energized already. Avo new delicious ensure active heart Health Supports your heart and body, so you stay active and strong. Ensure. Take life in. Ameriprise asked people a simple question in retirement, will you have enough money to live life on your terms . I sure hope so. With healthcare costs, who knows. Umm. 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. Start building your confident retirement today. West texas intermediate crude back above 75 a barrel today, in part, fears of opec cutting production next week in the meeting. Jackie deangelis has that story for us. Thats right. A wait an see approach and a pop on wti today and nothing major. Two big catalysts traders watching next week, the first is on monday when theres a selfimposed deadline for Nuclear Talks with iran to finally settle. Traders are looking forward to say if we have an agreement here oil could come back on the marketplace and then see prices continue to decline from there. And then you have the opec meeting on thursday. Everybody watching that one while were eating turkey and then looking for opec not to cut supply and may cut it at this point. Thats what the market is thinking. A very small amount. Take that in context. Producing 30 Million Barrels a day and shows that maybe some of the members of opec with more influence on the american me believes especially saudi arabia. Thats significant. Bottom line, could be a light come volume holiday week but crude could be volatile. Back over to you. Yeah. We expect that. Looking forward to that meeting and dramatic. Thank you. Will opec actually cut Oil Production next week . Lets ask chad brown and peter amandio. Welcome to you both. Chad, do you expect cuts at the meeting next week . Ill tell you why they wont cut it. Because they have the issue of the sunni of shiite iran issue and they shouldnt because they have u. S. Market tons heels right now. See the counts go down. The Corporate Board rooms are stagnant and a reason they shouldnt and wont cut it. Peter, what do you talk about on the floor . They have been talking about lower prices and i would assume talking about lower prices so they could get rid of their competition, such as north american shale and canadian producers and cost is higher and get rid of the high cost production. You dont think they will eater . I dont think theres going to be a cut. I think they want to see lower prices to get the competition out of the market. Theres announcement, peter, next week they dont cut, what do you think the price of oil does . Fall a couple dollars. One of the things we were seeing today is option premiums very soft which are insurance in the beginning of the day. As we got near the close, all of a sudden puts, the right to get short, got very high telling me that theyre already fearful of a gap open lower. This is fascinating maybe showing how soft the oil market is right now. How much further could the price of oil fall . I said on the show last time 75 is a 100. You have an issue of russians against the saudis. You have opec whos been delivering 8 Million Barrels to the u. S. Historically and now 3. Theyre not cutting production. Theyre going to hope the u. S. Sits on the rigs and u. S. From 1,900 rigs at these prices and flowing the oil and in very good shape with the u. S. Stagnant over two quarters. Talk about that impact will be on the booming shale industry here in the United States and up in canada. Theyre going to have to deal with lower prices because the cost of production is so high relative to the pries right now. Do we see consolidation or what do you think will happen . A big m a strategy in 2015. A rig count down 10 to 15 . The Corporate Boards in america cant allocate costs of drilling when they dont know the prices in three quarters an endoing that the beginning of the year, see Corporate Boards out in all allaying. Theres still meaningful production but not the rate of 2014. That seems like thats happening anyway, peter. A final question is how much does this opec meeting and opec itself matter to the course of oil prices and production in this country in the months ahead . I think it means a lot but if you were looking at the different producers, i think what you have to look at by the companies is whos hedging . Who protected themselves . Who protected the shareholders . Continental said they wont hedge the prices and its a fascinating week next week. Yes, it will be. Good stuff. Hey, guys, thank you. Appreciate it. Youre welcome. Thanks for joining us today. Thank you. Appreciate it. 30 minutes to go here. We are off the highs of the session. We had big jumps and the dow up almost 170 points higher and come off the level and holding up here with half an hour to go up 90 points and record highs. You is question right now. Is the u. S. Economy booming . Were not kidding. Somebody here is joining us here shortly thinks we are ignoring the signs of an economic boom. Well take his case next an we want to know if you think were in a boom. Some people are already voting. Click on cnbc. Com vote, cast your vote as we talk about it when we come back. Senator jack reed, his proposal on making the fed head of the new york fed a senate appointment. Dont miss it all straight ahead. Its more than the driver. Its more than the car. For lotus f1 team, the Competitive Edge is the cloud. Powered by microsoft dynamics, azure, and office 365, the team can gain Real Time Insights and instantly share information around the globe. When every millisecond counts, staying competitive begins with the cloud. This is the microsoft cloud. Seeing more truth in the market. This is an expiration day. Futures and options off the board on the close today and might get volatility and volume. Dow up 96 points right now. Both in record territory and the nasdaq is up 15 points. Yeah, the dow starting to flirt with 18,000 mark. Is this a sign that the economy is booming . Before the break, we asked what you thought on this. Polls are open right now. Cnbc. Com vote. Let us know if you think the economy is, in fact, booming. While youre multitasking there, lets talk about this with Steve Englander and says theres a decent chance that the economy is booming right now. Derrick kinny, meanwhile srks a bit skeptical of that call. So, steve, make the case. Describe the booming economy you think may be underway right now. Three factors that put the risk to the upside. First, even though the u. S. Economys off perceived being a fragile flower, over the last 18 months we had the taper tantrum, the government slowdown, the worst winter since the ice age. U. S. Economys doing just fine showing no signs of any kind of slowing. Second factor go ahead. And indications of whether its filly fed, the pace of leading indicators is picking up, the Way Investment is going, fulltime jobs are growing, these are indications we havent seen since of cycle highs and not in a long time. And very, very briefly, just that oil prices down. Tremendous global liquidity. They do it because theyre weak. No way we needed it right now and the benefit of it anyway. Derrick, do you think the economy is strong but not that strong or take issue with the whole idea . Yeah, kelly, lets cut to the chase. I think of investors think that the market is red hot and the economys red hot theyre in a big disappointment. We are far away from booming right now. If we are, we need to redefine booming right now. Kelly, its a tale of two streets. Wall street and main street. Wall street is teetering on 18,000 on the dow. Things look very good there. But on main street, we got concern, worry, nervousness of the average person, their personal economy is not reaping the benefit of this economy right now. I dont think the numbers substantiate a booming economy at all and further to that point, concern about geo police call issues and a lot of countries right now around the world in bad shape and if it affects our country that could drag our economy down, as well. Well, no. But derrick i cant say booming right now. Listen. But ill go back to steve on this and curious of your reaction but is it possible its because the world is doing so poorly its masking the strength of the u. S. . Honestly, could be enhancing it. Theres a possibility of that. Steve first. 1998, 99 or what we saw was the asia crisis which everyone thought was going to be catastrophic. In fact, the u. S. Came out of it very, very well. We are not that exposed an economy. The Global Growth could drop by 2 Percentage Points and would beoff set by the 20 price in the drop of oil in terms of u. S. Activity. Derrick, it doesnt feel like a boom but looking at the benchmark measurements. Unemployment below 6 . The aggregate earnings of the s p 500 index for the Third Quarter at a record of 30 a share. I mean, those are some pretty impressive numbers right now, arent they . Yeah, bill. I think when you say the economy, is the economy good right now . Y yes. Is it booming . The case is out. When i talk to retail consumers in dallas, we want to see consistency for the long haul. How long will this boom potential last . And i think we want the look at a couple things. When you think about the debt this country has, theres a lot of issues dragging the economy down right now and people are questioning is our economy truly standing on its own and not just the fed supporting it . Good spot . Yes. Booming right now i think is a stretch for most people. Fair enough. Steve, one of the interesting points came up in conversation with greg yesterday is this idea that contrary of what happens in your typical or previous cycles in this one the u. S. Economy and payroll growth and these things seem to be gaining momentum instead of losing that momentum. If thats the case, is it possible that to your point of the boom, the index up for almost 6 analyzed year to date are telling us that actually were going to continue to see the economy picking up . Is that somebody that anybody anticipates . Is it possible . Not priced into the fixed income market and the commentary you hear. I would agree. Last thing to add is that we have never been in this far in the cycle. Its not like this is an old Business Cycle by any means. Boom may be a word thats going to get a lot of attention but, you know, we have a good economy on our hands, steve, so why arent Inflation Expectations higher right now . We have f we have a boom going, typically you would think that would connote the kind of consumption that would lead to higher prices and not seeing right now in the aggregate. Look. You know, what were seeing is conflation expectations come down. I looked at michigan yesterday. Were getting a lot of impulses of abroad and i think mainly through the dollar and food and energy but it doesnt look like the internally that the domestic value added prices, wages are not falling but picking up slowly. Prices are not falling. They seem they keep the margins. Not a sign of an economy of a shortfall. We have been let me real add. Hang on a second. Let me point out the viewers agree with you, as a matter of fact. We have been conducting an unscientific poll. People choose to vote. Not the other way around. 69 of them, 70 now say they dont believe the u. S. Economy is booming and that goes back to the feel indicator right now. You know . Some of the numbers may suggest that were doing very well and doesnt feel that way for some reason. Why is that . Bill, thats exactly the point. The numbers may show one thing but how the consumer, makes up two thirds of the economy, feels is what dictates the progress of spending their money. The Holiday Season is a great barometer of this. Feeling good about the job, making the house payment, thats better barometer of their economy. Booming, no. Good, yes. We need to see it for several quarter it is really say the economy is on the uptick. The bottom line is that you and i and the average consumer feel like they cant save money, thats a problem right now. Fear and doubt and we dont need that in the economy. Derrick, steven, thank you both this hour. Really appreciate it. A pleasure. Provocative thought there. 18 minutes left in the trading session. The dow up 92 points. Any positive close there pretty much is an alltime high. Same thing for the s p up 10 points right now. Look. We could go out with a triple digit gain after all. Since the october bottom, this is one of the best runs for stocks in a long time and surprised just how well equities have done. Back in a moment with the eyepopping details. The Equipment Tracking system will get you to the loading dock. There should be a truck leaving now. I got it. Now jump off the bridge. What . In 3. 2. 1. Are you kidding me . Go. Right on time. Right now, over 20,000 trains are running reliably. We call that predictable. Thrillingly predictable. Maestro of project management. Baron of the buildout. 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. You can even take a fullsize or above, and still pay the midsize price. aaron purrrfect. vo meeeow, business pro. Meeeow. Go national. Go like a pro. Get to the terminal across town. Are all the green lights you . No. Its called grid iq. The 4 51 is leaving at 4 51. They cut the power. Itll fix itself. Powers back on. Quick thinking traffic lights and self correcting power grids make the world predictable. Thrillingly predictable. Wild market swings took us to the lowest levels for equities. Meg terrell has a look at whens turning into a rather historic rally since the lows in october. Right, meg . Thats right. S p 500 touched a sixmonth low on october 15th. Since then, up 13 . Led by industrials, health care and tech. All posting gains of 11. 8 or more. This rebound is the fourth we have seen this year and the largest. Taking a welcome at the numbers, buy the dip mentality holds true with each of the pullbacks turning into buying opportunities and market bounced back more than it fell. First decline, financials, Consumer Discretionary and then the market rebounded 9 led by materials and energy. Second, health care and financial stock that is led a drop of 4 in a week before tech, energy and health care were the big winners on the way back up. Third pullback with utilities and telecom leading the way back and then the last and biggest pullback saw a drop of 10 . Today 6 out of 10 s p sectors at new 52week highs. Back the you guys. Meg, thank you very much. See you later. Heading towards the close, you said this on the air . Yeah. We could have a triple digit day here when we go out. We were at 99 and change. It is expiration day and could get more volatility in the close here. The dow and s p in record territory right now. Later, a new way to invest in china if you want to. Exchange traded fund manager with a bond etf saying its less risky than u. S. Bonds. Really . Well examine that claim after the bell. Stay tuned. For tapping into a wealth of experience. For access to one of the top Wealth Management firms in the country. For a team of Financial Professionals who provide customized solutions. For all of your Wealth Management and retirement goals, discover how pnc Wealth Management can help you achieve. Visit pnc. Com wealthsolutions to find out more. Tn minutes left in the trading session on a friday. The dow up 87 points. Was up 176 on the open. Well talk about that in a moment. The dow and s p trading in record territory right now. Joining me, we got dave darst and steve. Working on the november beard. Not working on it. Not coming in. Why didnt we hold on to those gains. European markets up 2 this morning. Yep. Finished very strong. We are not. What happened . Im going to throw out technical things here. We are getting a little top pi. The index to watch here is not s p or dow but the russell 2000. Russell 2000, okay. Experienced a double top this year. We look at march at 1213. We look at what we did over the summer. Getting back to the highs of november, pierce that and shoot through that, then well challenge that top and right now thats worrying sign. Dragging the market. The russell led since 2013 and will lead us down. Keep an eye on the level especially next week. Should we be encouraged or worried about this rate cut in china overnight, david . Good thing, bill. Very, very happy to see japan do it a week ago. Right. China coming. European central bank beginning to broad out the scheme of asset purchases. I think the big number this week was the Philadelphia Fed index that came in. Strongest in 20 years . 40. 8, tremendous number. So i think you can look and take heart of china paying attention. If they let it drip, so for them to come down to a 560, they took the lending rate down by 40 basis points, deposit rate down by 25 basis points. So you basically see them paying attention. You got europe, china, japan paying attention. All of that plays out very well. Going to keiths point, 80 of the s p 500 stocks are above their 50day moving average and another indicator of toppishness to the market. And you can expect the market to come in here a little bit and a very good time to add some stocks in. Medtronic, abbott, johnson johnson. Im thinking youre not adding. No. Im neutral on the market all the way around. The counter balance point to the top piness and the russell 2000 is fundament things in the marketplace we tell you that money should flow into the smaller cap stocks and most notab notably, the Stronger Economic data here in the u. S. And the strong dollar and only see that and money flow into companies that predominantly do business here in the u. S. Opposed to large multinationals like apple and coke and ibm and the fundamental case for it. We have been talking earlier about how s p capital iq points out first time the aggregate earnings for the Standard Poors hit 35 a shir. Thats right. Expected to be 31 something for the Fourth Quarter of this year. So earnings dont seem to be a problem at least right now. Well, they dont. But still, i think the market is driven by so much more than just pure earnings and this is the great debate thats raged now for the last two years. And a lot of things affect my Decision Making on that. Most notably, Central Banks take action, the market pops on that. Tend to stay up. So those are some of the things to combat with. Its very difficult right now to digest the information. Thats one of the things you are pointing out. Well come back and talk about more with these guys and closing countdown and coming in a little bit. The dow up 80 points here in the close and after the bell, democratic senator jack reed talks with kelly about his bill to make the new york fed president a president ial apint tee just like the fed chairman is. Something to subject to Senate Approval. Find out if hes getting pushback and who from. 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. Open port twentytwoohoneseven on the firewall for customer db access. Install version twopointthree of db connector and ensure verbose flag is set in case of problems. clapping sound isnt the cloud supposed to make business easier . Get the one that can connect to the systems that you already have. Today theres a new way to work. And its made with ibm. About three minutes left here. A review of what happened. By the way, you are hearing cheers and boos and things going on. We have a rivalry commemorated on the close today. Its the football rivalry between lehigh and lafayette college. They met in football 150 years ago and the big game is tomorrow at yankee stadium. We have alumni of both schools here and been a loud, raucous time. Let me tell you. The rally started in china with the rate cut there and in europe, you saw a huge move there. The german index, the stock market was up 2. 6 . Our market started a big rally this morning and 2 would have been a big gain but as much as we started the rally this morning, it fell, lost steam right away and weve been kind of meandering toward the close with the dow up 76. Next week, the price of oil, opec meets on thursday. The talk is maybe they could cut production but as you heard from those traders we talked to last hour the expectation is that they will not cut production and let prices continue to fall and prices were higher today up 1 back above 76. David . This is a very good thing, bill. A 50 billion tax cut. With oil coming down. Like this. And gasoline prices. Personal income and consumption. Durable goods orders. You get the case sheller price. Consumer confidence. A detailed look at the economy. I think this is a taylor swift market. Shake it off. Shake it off. Shake it off. Well done. I mean, not that we have any great insights of opecs thinking. They could cut production and protect their price or leave production where it is and then take it out on the shale producers in the United States. Im the cynic on the story. Im number two of what you described. I think theyre manipulating the price. Wouldnt surprise me. We dont have oil as oversold inside of our work. How much lower . 70 and below easily and, listen, if opec turns on the spi gots more and get out of the way that will happen. Im with him on this. We are at the point now where Lower Oil Prices are helping. Very, very helpful. John f. Kennedy, we miss you. Ken cramer, jim cramers father, we miss you. For sure. Thank you. Have a great weekend and holiday if we dont see you before thanksgiving. Going out with the gains. 83point gape on the dow and the s p for record highs on this day commemorating that 150yearold rivalry between lehigh and lafayette. Have a good weekend, everybody. Hour number two of closing bell with kelly evans. Thank you, bill. Welcome to the closing bell and mascots this afternoon. Im kelly evans. Another strong week for wall street and dow. Trying to add 100 points falling shy of that level going out with a gain, still, of about 88. Up half a percent and the s p 500 adding 10 points and, yes, these are record closing highs and look at that, the dow closing above 17, 800 for the first time. The nasdaq meanwhile still trying to make another go back up towards 5,000. It was the laggard of the session today up about a quarter of 1 . Lets bring in the panel now. Recap the week. Look ahead to next week. Zachary carabel with kayla. Nath Nathan Bachrach and what did we learn today . The market will go up with quantitative easing somewhere in the world and china is quantitative easing the way we know it. Cheap money. In europe, the hope of quantitative easing and here qe for quality earnings. Because our corporations are doing fabulous. Its qe all around the world. You have to pick your terms. By the way, i wont believe theyre doing quantitative easing in germany until i see mario draghi come out with Angela Merkel saying im in favor of it, too. Otherwise hes a financial pinnochio. Zachary, do you agree . We live in a world of ample, ample liquidity and my thought is if the fed contracts, this is more of massive pockets looking for places to go. And then thats true for years. That doesnt mean that the markets are bolstered for years and just means that the stuff the receding tide is nowhere in the cards. I mean, you will have potentially the scandinavian countries, sweden, who knows what theyll do . Kayla, your money on lafayette or lehigh . I have to just go ahead and say that im not familiar with the rivalry. Im sure a correlation of probably a graduate of one of the schools. No doubt that the Central Banks pushed the market higher today. Every head attributed the reason for the u. S. Markets to rally. Thinking of the gains, you have energy and materials up today and obviously part of that has to do with Oil Prices Rising slightly. And the china rate cut but when you look at the last year, those are the two worst performing sectors and even though were seeing gains today, you cant lose sight of the fact that as well as weakening China Economy has bigger circumstances for the economy than just todays comments. Exactly. Ross, should people be buying the bounce across the space and buying china or should they be looking to the prouder picture of what kayla laid out and the downside of the trades to go . Were not buying china or oil at this point because i do think that china has a lot more to do to stimulate the economy and has to do with the corruption theyre cracking down on causing a lot less spending in china and we went to see how that plays out. How much lower for oil . I mean, you know, just looking at supply and demand, i say it could go 10 lower. Im a stock guy an i look at it as the average consumer is getting a ton of money in the pocket to spend. Every dollar oil lower, more money that we have to spend supporting our economy. We want to be in the u. S. Markets. Were the best market in the world. Retail names, too, here . What do you want to buy then . I dont buy too many retail stocks. I dont like the business. But you guys know, im an apple guy. You know . How many times can i tell you this . Up 17 since the last time i was on the show. Theyre going to have the best christmas of anybody. We like video games and the movie business right now with disney and imax. The entertainment business and travel. I actually looked at an airline the other day, believe it or not and might even invest in one. So airplanes are the new retail. Exactly. Virgin america, a great company. They destroy the competition. I have to say theyre the leader in the category. They just went public. Very nice cabin lighting. If youre i would say on rosss point that the consumer aspect of Lower Energy Prices is frequently talked about as a one to one, if you spend less money in the tank, more to buy lattes are gifts. It doesnt always work that way and theres not as much of a correlation as we think but for companies of airlines and industrial companies. Why not . Its not shown up. Its been talked about. You spend it. Thats what americans do. I tell you where i like it. I like retail. As we survey 1,000 people across the country with a simply money Xavier University survey. First off, people are satisfied with their pay which goes contrary to they are . Yeah. Feeling better than they have, alltime high. And job security and the job environment are also at highs and youll find a willingness to overspend this Holiday Season. Greater than before. Meantime, macys, our Hometown Team in cincinnati going out in the Third Quarter of a small inventory. I think you might see retail finding themselves able to command much higher prices and learn something from the airlines as we get towards christmas. Shop early. Hang on. Fast money trader steve grasso is joining us fresh off the floor. Steve, is this rally today, the volume seeing anything to do with the volume expiration . Of course. Thats the bulk of the volume. China Interest Rate cut got the bid underneath all those energy stocks. Industrials. So the materials names, the big thing, though, kelly, opec meeting next week. Thats going to be the big fork in the road for all Energy Related stocks. And most people are not waiting, you know, not holding their breath waiting for the cut of opec. Im wondering, steve, were closed for thanksgiving holiday here, how are people positioning for it . Actually covering shortterm into this rally in energy. Obviously, a lot of m an activity with the service names, that was the catalyst for a lot of people to start covering. Many of their shorts so beaten up but youre going to see that data, half data after thanksgiving, usually light volume day. But, you know, i could see that being a busier day than most, obviously, on the heels of opec meeting. Black friday, too, zach. Steve, are people positioning for 65 oil by the end of the year . Where are the bets going . I speak to as you know a lot of energy specific funds and they think that the bottom in oil is right here. So somewhere around the 70 range. Is that because theyre energy specific funds . It could be but you have to remember that longshort they make money on both sides. For them they dont have a vested interest in seeing oil sit right here. Obviously, for a lot of the eps cutting capx and seen the firms getting hit on earnings and truth of the matter is, you could see break the mark and technically holding 70. If it does, 65s not much support here. Thats not what the Energy Complex wants to say. Ceo of halliburton called the fairway where they need it to be to help the consumer but also make sure that their Business Models arent completely killed for the time being. You know, thats actually very honest because, you know, this last six months we have heard a lot of guys say they could make oil depending on the region theyre in, make money, the businesses down to 40, 45, 50. The truth of the matter is we used to hear that number be 70 dr. It was 80. We know i assume its higher than here. Like keystone, right, which was so in the news. That oil sand, heavy tar sand oil above 90 to be feasible. 100 . We have to remember, oil used to trade at 25 a barrel for a very long time. And the price of oil is sort of arbitrary to some degree based off supply and demand. Fact of the matter is, kelly, 250 million a day in the consumers pocket and i say it gets to you heard ross. He doesnt like the retail story and we have heard this from macys itself. They said its health care, tech. Might have been Home Furnishings and dont specialize in. You have to get jon fortt off the show. Talking about tech kathie lee. The behaviors have changed and we saw it last kris ms and this christmas. The Big Box Stores just dont appeal to most shoppers today. I ask you, kelly, where will you go shopping . Will you walk around soho or macys . We are at the Stamford Town Center next friday. Thats a different story. Williams sonoma. Im fascinating by nathans survey data which is so contrary to exit polling data from the election a couple of weeks ago. But not contrary to the quits rate and Consumer Confidence and theres an interesting disconnect where if you ask people about personal finances or economy, theyre much more upbeat than the direction of the country. But when you think of retailers sounding the bullish horn about their customer, its t. J. Maxx stores and gap, urban outfitters, macys warning for the full year saying its below expectations so even though they have more money, they want it at a discount retailer. You think the cool kids are buying tech. Steve . Another thing to factor is in how much spending going on on etsi and not tracked and spending online sites that are small retailers and other people that arent even really tracked and a company like etsi doing a ton of business on trafting and homemade goods and theyre still thinking like the old days and people just are different. In the aggregate retail stores, up strongly. Its increasing rate of 7 or 8 and year on year. I was going to ask a possibly controversial question and important one and goes back to health care an ento what extent are premiums related to obamacare and happens this time of year, only second year of this massive activity hitting just entering the Holiday Season. How much is that potentially taking a bite out of Consumer Spending . To me, theres so much noise and so many contrasting statistics. We dont know how many people are enrolling. They dont know the baseline. Enrollments are uncertain. Congress, you know, whethers going to happen state by state mandates . The moving parts are in my view almost impossible to gain. Amounts to a wash or a real impact, say . Than . An impact on the economy. On the question of health care right now, they are very satisfied with their health care and i think a warning two years from now. Arent the clients of yours relatively well off people or a wide sampling of the u. S. Population . The surveys 1,000 people across the country. Both client standpoint and nationally, people are pretty happy with the health care and people, 6 million, or 7 million, people didnt have it before. Look at what insurers the last year. Steve grasso, just last word before we go . I think you bring up a great point. Corporations are bearing the brunt of the cost. They are happy they have health care because theyre not paying for it. Business owners are paying for it. You bring up the point of the premiums, how much gobbling up from the benefit of lower oil. Thats a great point. Try to circle back to it. Catch steve grasso coming up with the crew at 5 00 talking to ceo of red robin why that stock is on a tear over the past month up 30 and red robins new holiday red wine, yes, milk shakes and ross gerber cant wait to get his hands on. Thank you, ross. Good to see you this afternoon. The dow and s p 500 closing at alltime highs again and this before any santa claus rally. Our top two wall street pros weigh in, two top wall street you know what im saying. Chinas surprise rate cut giving stocks in the u. S. A boost. Is this a tremendous buying opportunity in china . Thats also coming up. Robot butler, can you shut the shades . Oh and could you turn on air conditioning im starting to sweat. Ill just do it myself. Useless. Thats nice. Sets the mood. Have your entire house within reach, even when your devices arent. Introducing relay by wink its like a robot butler, but not as awkward. First impressions are important. Youve got to make every second count. Banking designed for the way you live your life. So you can welcome your family home. For the first time. Chase. So you can. Welcome back. The dow, s p 500 closing again at a record high. I feel like a broken record. Mary thompson, what drove the day . Transports, kelly. Rate cut in china as well as expectations of the ecb buying sovereign debt and a lift to the u. S. Markets. As you might expect seeing lower rates in the worlds second largest economy, that benefits material, energy and industrial stocks. The leaders in the broader markets rally today and also posting gains today were some of the etfs of countries commodities based and they could see higher demand of china for the commodities they produce. Brazil as well as south america and of course the china, the largest chinese etf, xfi also trading higher in heavy volume in todays session. The news of the retailers today, mixed. Stand dwrout is ross stores with better than expected results and lowered the outlook for the Fourth Quarter, its stock got a nice boost today. The gap lowered the fullyear outlook and ann taylor and missed in the Third Quarter and aushs comments of the Fourth Quarter, as well. Foot locker turned lower and the fresh market, a Grocery Store and absorbed the higher cost of food and stock got hit and the dow ended up 91 points. Back the you. Yes, it did. Thank you. Fifth higher close week in a row we should say. Lets bring in two guests. Jeff, well start with you. How much can equities go here and when do we hit dow 18,000 . Probably between now and year end. I have learned its difficult between thanksgiving and christmas to put the market down. It just seems to be the ebb lens of the Holiday Season and since 1950, december up 48 times and down 14 times and you have a seasonal upward bias here. Whys the market so strong . Whats driving all of this . We are in the midst of a credit boon. We have a scary selloff every once in a while and the pattern is the same, greek crisis or the fiscal cliff or the end of qe3. We selloff like it lease the end of the world and the buybacks and credit buying pick up and since the bottom of a month ago, Credit Investors brought almost a quarter trillion of corporate bonds. 352 billion as of yesterday. Probably over the top today. Financial engineering. 70 billion of stock buybacks since the bottom was put in and this is probably going to accelerate into next year. That, jeff, would tell you what about just what kind of equity performance to see in 2015 . Well, i came into this year thinking that even this despite the tapering announcement that the feds Balance Sheet expands 10 to 12 and earnings up 10 to 12 and i said at the beginning of the year likely with a high r squared or correlation that the s p up 10 to 12 . I would say the same thing of next year, quarter. I have to ask you both a question i hear all day long. Oh, market had the helloth guy, a high every five days this year. Im sitting on the sideline in cash. Now what do i do given what you have said. Brian . Well, the credit market is acting as if the s p is well over 3,000 for over a year now. So over time were going to go higher. We will still have the selloffs. Some point the fed will start to debate tightening and another panicked selloff next year like we did in october. But over time, the stock market goes significantly higher. We know that most Institutional Investors are overweighted in stocks and then start to catch up to the credit market and more invested. All right. So my well call it the russell 2000 question, why small caps lagged so dramatically and talking like 10 Percentage Points. Thats an extraordinary gap. And of course, the question is, is that because institutional money is going to index funds or catch up or whats going on in your views . People hate stocks and most investors selling stocks. They have been companies themselves and most companies in the russell 2000 too small to access the credit market. Like alibaba came in with a 8 billion deal yesterday and there were 57 billion worth of bids. So for a russell 2000 company to come in and try to issue a bond, its too small for people to notice and they dont have the ammunition to drive the stock price higher so that means when people try to sell stocks, they go for the russell 2000 and only 20 of the stock market. The 80 of the stock market which is represented by the s p 500 is being propelled higher by engineering. And the credit boom is going to intensify over next couple of years because pensions bring in more money to the credit market. Look at illinois today. Dragged up by the Financial Engineering but thats going to take some time and the russell 2000 is not any way, shape or form set to lead in the next couple of months. It is the big caps right now do you concur . What are you telling clients to be buying here . Well, i just got back from europe and the europeans all wanted to talk about is emerging markets stocks and about u. S. Stocks and theyre not interested in the russell 2000 for the most part. Theyre interested in the big cap and the big names that they know over there. I would also point out that the russell is still fairly expensive. On a historic pe ratio basis. But i think youre at the stage of a secular bull market where everything is going to work because i think you have 8 to 10 years left in this thing. Eight to ten years . Well, secular bull markets tend to last 15 years and return at 16 per year. Do you agree, brian, about that time frame . Brian, do you agree the pensions have driven the Financial Markets for 25 years, theyre bringing in more money the try to cure the underfunding. Theyre raising assessments on the cities and town that is contribute to them and lasting for a number of years longer. Equity investors, they keep betting on the end, betting on the end being right around the corner. So you get the sickening downturns that feels like the world is ending but once the seling runs the course, we go back to the highs and then a long, strong run after that and thats where we are right now. Incredible to think it keeps going. Thank you both. Jeff, brian, this afternoon, a lot to think about over the weekend, for sure. Federal reserve governors including the chair yellen is confirmed by the senate. The next guest wants the same process for the head of the new york fed which oversees wall street banks. Senator jack reed here to explain why hes trying to make that the law and House Speaker john boehner says president obamas executive order is sabotaged hopes for bipartisan reform. Is hope for issues lost . Chuck todd joins us later on the closing bell. vo rush hour around here starts at 6 30 a. M. On the nose. But for me, it starts with the opening bell. And the rush i get, lasts way more than an hour. announcer at scottrade, we share your passion for trading. Thats why weve built powerful technology to alert you to your next opportunity. Because at scottrade, our passion is to power yours. For tapping into a wealth of experience. For access to one of the top Wealth Management firms in the country. For a team of Financial Professionals who provide customized solutions. For all of your Wealth Management and retirement goals, discover how pnc Wealth Management can help you achieve. Visit pnc. Com wealthsolutions to find out more. You know how fast you were going . About 55. Where you headed at such an appropriate speed . Across the country to enhance the nations most reliable 4g lte network. Hows it working for ya . Better than ever. Howd you do it . Added cell sites. Increased capacity. And your point is. So you can download music, games, and directions for the road when you need them. Whos this guy . Oh thats charlie. You ever put pepper spray on your burrito . I like it spicy but not like uggggh spicy. He always like this . You have no idea. At t. The nations most reliable 4g lte network. Welcome back. If my next guest has his way the head of the new york fed could be subject of senate confirmation. Senator jack reed says the new york fed needs to be held accountable for the actions. He joins me now with the latest on the push. Senator, great to see you this afternoon. Thank you. Can we begin with the hearing today, this question, this notion was put to new york fed president dudley. Were you satisfied with the respon response . President dudley expressed no reservation or objection to having the legislation passed. He was quite clear about that. He said it was up to congress. This is a proposal that i not only made and included Senate Version of the doddfrank bill four years ago and about creating a structure that will inspire confidence across the not only the American Public but also the Financial Firms that the person there has significant responsiblies for regulation and also has clearly responsibility to the nation and to good economic order. Senator, do you think that if bill dudley had been nominated by the president and the process he wouldnt have made it through, that somebody else would have been at the helm of the new york fed and handled matters quite differently . I dont think, again, this is about mr. Dudley. I proposed this four years ago and he was on the scene. This is about going forward. This is about dispelling in one respect the perception that many people have. In fact, its growing with some of the revelations that theres no difference between the regulator and the regulated. That the regulated has been captured. I think we have to dispel that and i think one way to do it in a procedural and principle way is to have the process as done for every other major federal financial regulator in which the president nominates and the senate confirms. I think that would give the individual whoever it is the additional i think credibility that he is in a process not exclusive just to new york, frankly. Also, by the way, raise the spector of this process held up in the confirmation process which you know happens time and again because its so politicized. Would you be comfortable if theres no head of the new york fed . Well, you know, the process applies the board of governors. My sense is that two of the seats are still open as i understand. They are still open. Theyre waiting i think not only on nomination and confirmation but i think this is a situation where if you look at every other major federal regulator, comptroller and others, they have to go through the process and we recognize and we should recognize that if we establish this we have the responsibility to fill these positions and thats something i think that we hopefully will recognize if we pass this legislation. Right. But you do see what im saying that it sounds like this idea could hold up, keep anybody from running the agency that because were having this conversation has demonstrated how vital it actually is. No. I dont think it will. Again, we have federal regulators in place. There is, in fact, there would be pressure, huge pressure publicly and through other ways if the vacancy was open for an extended period of time. Part of this is making sure the process works and in a way in which the individual is perceived to be clearly responsible to ultimately the American Public, not to particular entity or sector. Thats why every major regulatory position in the federal government and most state governments is subject some type of political appointment and confirmation. Understood, senator. Just to back out from the narrow issue to more broadly banking regulation, there are a lot of different agencies who we have been pressing for weeks now, the cftc, the piecemeal fashion of which theyre regulated itself is part of the problem, is there anything thats going to resolve that . I dont think theres anything immediately thats going to resolve that. Some of doddfrank was designed to try to coordinate better the existing agencies but to be honest and candid, i think we are in a situation now where our best approach is to move some of the regulations that were sponsored or created by doddfrank, get them on the books, give Financial Institution and the public more certainty. Thats i think the immediate step. Yes. Its been going on five years now. Most of those rules, many of them anyway, still not written. Senator jack reed, doing his part to try and make sure that theres more oversight, at least of this new york fed position. Thank you, senator, for being here this afternoon. Happy thanksgiving. Thank you. U. S. Federal reserve may be on the verge of cutting rates but china cut. Should you be investing in china . Thats yex. Will president obama and democrats feel a backlash of voters as the immigration executive order if it ends up depressing lower end wages . Meet the press Moderator Chuck Todd weighs in on this one. 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This cloud turns data into excitement. This is the microsoft cloud. Welcome back. Surprise move, china cut the lending rate first time in two years and u. S. Firms watching chinese based etfs. It is different in that it takes aim at the onshore bond market. Bruna dalama says it may be a less risk of a u. S. Based etf. Welcome. Are you saying less risky than the u. S. Bond market . Definitely not saying that. I dont think i would claim that at all. Its really just an i think fantastic story from an access perspective. It is unusual of a 5 trillion Capital Market thats essentially untapped for u. S. Investors, institutional and retail. This is a vehicle that allows access to a market that before was just not available. Lets talk about that. We have a planned economy in china, a nice way of saying a dictatorship playing with capitalism. You never know what you get. 2 billion people with a change of attitude, we could see things go differently. What happens if the chinese currency will rise . This is yuan denominated fund and what investors like. Looking at it since 2004, its appreciated about 25 . Since 2011 about 11 . So you potentially get an additional pickup. What if it goes the other way . You take the risk. Clearly, thats an exposure with the fund and it could for or against you over long term our perspective and expectation is that the yuan will appreciate. But it could work against you. I would probably take a different tact that its not a dictatorship of capitalism. Its an autocratic government. Sounds so nice. I feel better already. You know, believe it or not, u. S. Capital markets are not highly predictable in spite of the fact we like to hold that out. I have the question of how much liquidity really is there. Its a much more constrained bond market. May be 5 trillion in access but not 5 trillion is not accessible in an open market to foreign investors. Its surprisingly extremely liquid so when you think about liquidity for the fixed income market in china theres two segments of the market to trade it. On an exchange. Thats about 5 of the liquidity. 95 is on the intrabank market. Very difficult to get approved there. We have an approval for the fund through thats what i meant. May be liquid internally but not foreign investors. Correct. This is exclusively really a domestic market with the 5 trillion invested in the market. Its all really onshore investors, only now that for investors through the vehicles. How much can you absorb . Everybody decided this is great, how much can this etf actually absorb . Yeah. The etf can be massive. You look at sort of a penetration of etfs different Capital Markets, typically a 5 penetration, brazil etf, 3 of the domestic Market Capital and 5 of 5 trillion is enormous capacity. The other side is theres a rumor some day Interest Rates here in the u. S. Are going to start to go up. What do you think happens in the fund to see Interest Rates in this country rising . Thats the other risk to understand as an investor before i put a dime anywhere. Yeah. I think thats when, you know, we designed the product talking to Institutional Investors and like about the fund the diversification, the correlation of the Central Bank Actions in the u. S. And china and when i go on a roller coaster, lie toi like to figuref i need dramamine before i go on it. When Interest Rates start to rise in the u. S. , you know, doesnt necessarily have an impact in the u. S. These economies are connected, a lot of trade between them, but really whens a bigger driver of Interest Rates in china is whats happening today, growth rates. Accelerating in china. Thats slightly to cause a reduction of Interest Rates and even as we see Interest Rates rising in the u. S. Our expectation is more likely to see rates going down in china. We have to leave it there. It is going to be probably that concern about a slowdown that keeps some people on the fence in this one. But bruno, here to explain why they should think about jumping in. Thank you so much for being here. Republicans say president obama sabotaged all hopes of working together with an executive order on immigration. Meet the press Moderator Chuck Todd is here to talk about that. Latebreaking developments in ferguson, missouri. Thats right after this. One you wont find anywhere else. Onesecond trade execution. Guaranteed. Did you see it . In one second, he made a trade, we looked for the best price, and the trade went through. Do the other guys guarantee that . Didnt think so. Open an account and find more of the expertise you need to be a better investor. You are gonna need a wingman. And with my cash back, you are money. Forget him. My Airline Miles will take your game worldwide. What im really looking for is i got two words for you rewards. Theres got to be better cards than this. [ male announcer ] theres a better way with creditcards. Com. Compare hundreds of cards from all the major banks to find the one thats right for you. Its simple. Search, compare, and apply at creditcards. Com. First rounds on me. Welcome back. President obama is in las vegas signing an executive order to overhaul certain immigration standards. Meanwhile, speaker of the house boehner and other prominent republicans taking a hard line against the president s action. John harwood has the details from washington. Reporter hi, kelly. President obama went on the road today to las vegas to build support for the order he outlined on National Television last night, he went to a high school in las vegas meeting with a cheering crowd of latinos and he himself seemed liberated by the idea of years of congressional gridlock on this topic hes finally done something and moved ahead. Weve known about this for years. And we have known we can do better and for years we havent done much about it. Well, today we are doing something about it. Reporter now, president obama said the solution for republicans who dont like what he did is to pass a bill. He repeated that again and again and mocked the inability of the house to move the bill and seems clear passing the bill is not what john boehner the House Speaker in his Statement Today had in mind. With this action, the president has chosen to deliberately sabotage any chance of enacting bipartisan reforms he claims to seek and as i told the president yesterday, hes damaging the presidency itself. Reporter now, the question is where do we go from here . The house finally after announcing the intention to sue the president over obamacare did so today. Its not clear the legal action of the courts venue chosen for house republicans. There are other ways through the appropriations process to try to tie the president s hands and clearly looking at a big fight over the next few weeks and months, guys. Well brace for it. Thank you for now. It was widely expecting the congress and democrat in the white house good in terms of gridlock for the stock market. With tensions of immigration reaching a fever pitch, quould the gop do something to retaliate to turn the market on the head . Joining me now is chuck todd, moderator of meet the press. Great to see you again, chuck. Lets begin there with the executive action and whether as Mitch Mcconnell was saying we will take action in retaliation on this. Is that this suing the president over obamacare or more to come . I think they would they need to try to find something. I think thats what Mitch Mcconnell is trying to say. Now, the lawsuit isnt enough. I think mcconnell and boehner know they have a base of the party that wants a political retaliation or retribution but they cant agree on what that is. I think secretly they hope that a state because the lawsuits that i have heard about that could be filed against the president and his action could come from, say, the state of texas or the state of oklahoma, two states where the attorneys general or governor openly talked about it, the social services being overburdened and sue under that guise. The problem, kelly, is the politics is so complicated. The president put the republicans in a box. The easiest way is to pass a bill, and even veto for higher ground, but they cant agree on a bill. Well, and do you mean the bill on immigration, chuck . I do. Border security or even on a piece of it. Yeah. Thats a problem for them. They dont have a piece of the bill to say, mr. President , we did pass something. You didnt negotiate with us. Thats not the case here and so republicans dont have very high ground to be standing on, on this issue. Zach . Hey man. Why the timing . Why not wait three months, say, hey, you know, call a photoop, meeting at the white house, talk about immigration and then clearly doesnt happen, you then have an announcement. Why now . Look, zach, thats what i thought they would do. Have the president say by the way, dating this june 1st, 2015. Republicans, you have six months and if nothing happens, it goes into effect. The white house argument says we have already delayed. We have delayed as far as the hispanic communitys concerned. Theyve been postponing them for five years. They keep saying wait until you next year, wait until next year. The call collision on the white houses part is running out of time, credibilitywise with hispanic activists on this issue. Sounds, chuck, like something that could have been brought to the public as early as labor day and then the president waited until after the midterms anyway and it does feel like this is going to become a galvanizing issue and more executive orders becoming more galvanizing issues and just building a todo list for the gop to things to overturn on day one if a republican president comes into office. Perhaps. I have to tell you. The irony of what the president announced hes doing and calling for onpacted on this, most republicans and everybody agrees is going to be the policy once something is passed. Meaning, there is going to be some form of amnesty for the people that are already here and not deported. Maybe they dont ever become legal u. S. Citizens. But they become legal in some form or another and they certainly arent deported so i dont know if youll ever have a republican president rescind this policy, kelly. I dont believe it. I wonder, chuck, to pivot and talk about an issue that threatens to overwhelm this into the weekend, of course, talking about the grand jury verdict in ferguson, missouri. Right. Can you update us on what you have heard in terms of how many protests there are planned across the country, whens responsible for the timing of this decision and what the fallout politically might be and just in terms of National Dialogue in this country . I have to say i think its sort of a sad leadership that we have seen and i put leadership in quotes to declare a state of emergency as the governor of missouri did before anything happens. Is a pretty pessimistic way and you could argue almost encouraging there to be unrest by saying, oh boy, youre batten down the hatches. Here we come. Rather than a message of, look, this is going through the Legal Process and that so i think that i have to say that i think some of the decisions by how public this is a state of emergency, Law Enforcement putting out warnings in a weird way may be sending the wrong message. Sure. Chuck, im hearing theyre closing schools there next week. Right. And it just its a it feels self fulfilling in a way that, again, a throwback to the way leadership might have acted in the 60s or 70s. The 21st century, this seems out of date. Im sure you will be covering this. We are. And the show planned for this immigration topic. Thank you for joining us this afternoon. Chuck todd, appreciate it. Chuck will be joined by the panel and experts to discuss the president s latest move on immigration and the longterm implications a fen that ferguson decision comes down theyll be covering that, as well. Local listings have your show time. Straight ahead, immigration is not the only hot topic in washington today. Far from it. House republicans suing the government over obamacare. That story and more when we come back. Monday, we talk with retired neuro surgeon and critic of president obama, dr. Ben carson. You wont want to miss that. Your old 401k is rolled over into a Td Ameritrade ira. Yes so no set up fees wooh yeah so i get help from rollover consultants . Wooh yes no rollover hassle. Great. Woah oh, were spiking things, robbie. For all the confidence you need. Thats better Td Ameritrade. You got this. Just how fuel efficient is that ford f150 made of aluminum . Thats whats burning up the hot list with alan. Hows it going, kelly . People love pickup trucks. Phil lebeau wrote this wonderful good news, bad news piece for ford. The good news is their new aluminum f150 is actually going to get better gas mileage than it used to because aluminums lighter, so its going to go from an average of what was about 19, its going to go up to 22. Good news. Bad news, thats not going to make it the best pickup truck in the category. That still goes to chryslers dodge ram. Which will get 23 on average. Oh, come on. 22, 23. The point is if youre buying a big honking pickup truck, are you really caring about gas mileage . Exactly. I love pickup trucks, too, by the way. Carry on. But speaking of costs, dan mangon wrote a wonderful piece looking at the outofpocket cost for obamacare. A lot of people dont realize, they go in and get their bonds plan, it covers 60 of their medical costs, but only after they hit a 5,000 deductible. Ouch. 70 , 3,000 deductible on average. But job base plan, 1,200 deductibility on average. Hopefully theyll read dans article and get a clue. We were talking about this impact on the consumer wallet earlier on the show, so its definitely worth checking out. Speaking of disappointing prices, our third one, tech crunch reported this today. We wrote up the tech crunch report. Its looking at fab. Com. Remember that site, it was all the rage. It started out as a gay dating site and morphed into a home decor site. Everyone said this is going to be the bomb. Well, turns out now theyre getting ready to sell it for anywhere between 50 million and 15 million, which is quite a drop down. So much for startup craze. Exactly. So many of our stories have been going in the other direction, so well see what happened in this case. But alan, thank you. Sure thing, kelly. Have a great weekend. You, too. Dow 18,000 next week . The panels final thoughts when we come right back. Tdd 18003452550 [ male announcer ] your love for trading never stops, tdd 18003452550 even on the go. Tdd 18003452550 open a schwab account, and you could earn tdd 18003452550 300 commissionfree online trades. Tdd 18003452550 so if you get a trade idea, schwab can help you take it on. Tdd 18003452550 were getting a lot of questions tdd 18003452550 about organic food stocks. 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For access to one of the top Wealth Management firms in the country. For a team of Financial Professionals who provide customized solutions. For all of your Wealth Management and retirement goals, discover how pnc Wealth Management can help you achieve. Visit pnc. Com wealthsolutions to find out more. Welcome back. Time now for some final thoughts with the panel. Kayla . Im going to eat a lot of turkey next week. A lot of it. On thursday. And maybe watch the opec meetings. Yeah. Somehow live tweeted. Thats what everybody does at thanksgiving at my house. Youre not shopping on your ipad, you are watching the opec meeting. Is anybody going to go to the stores on thanksgiving . The answer better be no. No. The best deals are on monday. Or thanksgiving. Im telling you. I hate to be the one to tell you. Monday or thursday. You can get them on the internet. Is that how you shop . Thanksgiving week normally is up three quarters of a percent on average in the week, when typically the market is only up about 17 basis points, if you can slice a percentage point that small, and we actually calculated in the american household. We actually heard jeff come on earlier and say he never likes to try and short the market this time of year. Is that your view here as well . This year, this market, no. You get run over trying to do it. Im long. Im still very enthusiastic. Im looking at china. Im looking at europe. Im very much worried about middle of next year. But right now, im good. Three years ago right about now that the market and the Financial Markets had their last major convulsion. A little bit in june 2012. And then that passed. And look at where the tenyear spanish yield was today. 2. 03 . Italian tenyear. 0. 77 . As an investor, lets remember one thing. When the stock market pushes some money at you, take a little of the privacy. You need income, take it now, put it away. It was so funny, the time of the year where people say how could we never borrow at three . Now its borrowing at two. What happens next . In ten seconds. Barring a massive seizure of the credit markets, were in a lowmarket environment as far as the eye can see. Its so hard to fathom what happens next. Thank you all for being here and have a great weekend. Fast money coming up in just a few moments with melissa lee. Whats on tap, melissa . Two of my favorite beverages, milkshakes and red wine. What would happen if you combine the two . Is this a new product, by the way . I saw the teaser to this. I couldnt believe it. Red wine milkshake. Oh, my gosh. Red robin gourmet burgers. Weve got the ceo on. It is a stock up about 30 over the past month. Is it just cherry . All right, over to you guys. Ill let you know. Thanks, kelly. Its fast money friday. Live from new york citys times square, im melissa lee. Tim, steve, brian, and guy. Tonights top story, chinas big move. Peoples bank of china cutting Interest Rates today, sending stocks to intraday highs after bank of japans surprise stimulus just a few weeks ago. So add into that a little mario draghi comments, in terms of easing Central Banks around the world. What do we have here . You definitely have fx wars going on. I think china is doing this for reasons that are domestic