Transcripts For CNBC Closing Bell 20160318

To raise rates it could increase in inflation. He doesnt conclude that would happen but we need to think about that. He repeats kind of the normal argue amount for raising rates and says f1 policy remains extreme and inflation is close to target. Not strictly endorsing but saying thats the normal argument for why rates should be normalized. Former Federal Reserve chairman ben bernanke out with a blog about negative Interest Rates and says the fed is not out of ammunition but there are signs Monetary Policy is reaching its limits. They include lowering rates but not much to do there. A quarter point. Forward guidance could be powerful. More quantityive easing and negative Interest Rates. What does he say sna that evidence from europe suggests they might be more powerful than had previously been thought and argues anxiety over negative rates could be overdone. Banks could still earn a profit by charging a higher rate than they pay. Bernanke also says negative rates have modest benefits and manageable costs but points out there are legal issues and could hurt money market funds and probability of negative rates are low in the u. S. In the foreseeable future. Bill, a theer receipt cal thing about this new idea that the rate you said gives inflation you said and ben bernanke weighing in on this controversial issue. Steve. How much of a change in tone is this, milton freedmans 90th Birthday Party or speeches largely address s bank of japan at the time but saying were sorry we did it, were sorry, wont let it happen again, referring to the Great Depression. But also kind of saying quite confidently, Central Banks are never out of ammunitions. I do wonder just how tempered his confidence has been over the past 12 years. I think reality has intruded on the theory as you remember. When he wrote that he was barely a Federal Reserve governor. Its so interesting you bring this up. I happened to interview him when he talked about the helicopter idea and i think ben is a lot wiser when it comes to the practice of Monetary Policy. And hes sort of tempering or changing his thinking with the reality of it and sees issues out there. He is sort of still theoretically saying you know what, the costs are manageable and benefits are there and it may be more powerful. What he hasnt seen in europe is this big whole sale move to cash and that gives encourage. They could be potentially used and one of the things hes arguing, were reaching the end of the tools we use and should think of other tools in case we have another downturn. We should never forget that economic theories constantly evolve. They joke that economics is the only discipline where things work in practice but then dont work in theory. There you are. As i said to you yesterday when we were talking about this, thats why god gave us two hands, on the one hand and other hand. Before we let you go. Remind us again. Is bullardmore hawkish or dovish side. He has been in the middle but some of the theoretical work has been an intellectual pulling guard for the Federal Reserve. His ideas can become policy for the fed so we watch them closely and leaned hawk esh and dovish depending on the latest theory. A little all over the place on this one. We need to think about this idea. This for kelly im saying this, brought up by cochran in case youre interested in you want to look it up online. For kelly, not for bill. No offense, for kelly. Way too deep apparently. I agree. I was thinking back to the old joke about economists it was like, how do you get an economist to fix a lightbulb, assume it is fixed and it was Something Like that. We are in unchartered territories, a huge source of criticism and they are trying to figure out what makes things go and bull ard is bringing up issue, weve been at zero for a long time. It should have caused inflation. Maybe this idea the Interest Rate we set will give us inflation is something we ought to be thinking about as far as he goes there. Thats what critics have been saying for years, hes lending them so credibility here. Thank you very much. Have a good weekend. Harvey from wells fargo and ben willis from princeton securities and Performance Trust Capital Partners from the cme. Ben willis, whats the rally been about, delayed one day after the fed didnt do anything and big rally yesterday, continues today, whats going on here . I think its a followthrough first through the trading side of the equation and when we saw the fed pull back on their expectation of rates. We looked back and see what happened in the Energy Sector in particular. You saw massive short covering, thats telling you trading money, very smart money that had ridden this bear market down in particularly in oil and that changed the whole mentality offered sideline. Were seeing money flow in the marketplace particularly in the consumer side. Still safety issues, seeing money flow into utilities as well. You follow these numbers and i follow out of etf global some of the research on etf side. Youre seeing that money go into those sectors, and bullard put out with the idea that raising Interest Rates may force markets into do something or force inflation ary pressures. The idea that he quoted reality intruded on theory, it was perfect. I will use that one for the rest of my life. It takes me back to my economics class and professor saying please dont talk youve been in the real world, im trying to teach economics here. Speaking of the real world. What about the expirations well witness on the close today . Really a nonevent. The real event was the fed announcement the surprise wasnt that she a low energy trade today were quiet five weeks in a row and two things ben bernanke has to know, the paper on debt deflation cycles look that up on google machine and bernanke has to look at japan. Were exiting policy so this exit will be experimental and a lot of chatter and add to uncertainty. Were going to be all watching the the Central Banks going forward. Were going back to economics classes this week after and notably to the Great Depression too. I guess. Whats a treasury market to do now . Theyve been anticipating a rate hike at some point this year but maybe they wont get one until june, maybe not until december . What are you going to do with this market . I think we may get one rate increase and second half of the year and treasuries to me are still in a trading range. What the fed is doing in the shortened of the curve doesnt have much to do with the 10year. I think the 10year is still in a 1. 5, 2. 45 trading range and the fed has given the all clear for a little bit of speculative end. By the way, what do you like here when we start to look how you play markets in this volatile and unprecedented period for Central Banks . Well, i think that some parts of the equity market are attractive and utilities which has been a real surprise for investors will continue to be an attractive area. They have growth that i think will be competitive with other sectors and i think the Consumer Sectors discretionary resulted to housing and autos will continue to be strong. I think consumer staples. Those areas will continue to be good. I think in health care, some of the tools and devices and Services Companies will be good. They dont have the price fallout that the pharma side does. What are you expecting from this expiration . Brian says maybe a nonevent. I know volume is already very heavy from the open this morning. This is the first big expiration of the year. What do you think will happen over the next 15 minutes. Big volume. I think the bias is to the upside going to the idea of large institutions that are short, forced to cover into this and going back to the segment prior on the dividend side, theres a realignment of the vig etf, the dividend etf. Youll see some plays in particular with these stocks no longer in that group with some pressure coming out. And Trading Opportunities inside if you will and bigger number youll hear from art cashin im sure youll hear to the buy side as we continue with this market. From individual stocks, should have good dynamics. We appreciate everybody being here. With about 50 minutes to go in a market with a dow up 120 points. Week five of this rally from the recent lows and s p up 9 and nasdaq up 22. Starwood now agreeing today to sell itself to a Chinese Company and calling off the deal with marriott. Well take a closer look at all of the foreign money piling into the United States this year, the numbers will surprise you. Also ahead, oil has been on a fiveweek tear along with the stock market, we have someone who says all of the signs are pointing to a sell for crude and hell explain why coming out first in business worldwide. Opportunities arent always obvious. Sometimes they just drop in. Cme group can help you navigate risks and capture opportunities. We enable you to reach Global Markets and drive forward with broader possibilities. Cme group how the world advances. Our cosmetics line was a hit. The orders were rushing in. I could feel our deadlines racing towards us. We didnt need a loan. We needed shortterm funding fast. Building 18 homes in 4 ½ months . That was a leap. But i knew i could rely on American Express to help me buy those building materials. Amex helped me buy the inventory i needed. Our amex helped us fill the orders. Just like that. Another step on the journey. Will you be ready when growth presents itself . Realize your buying power at open. Com man 1 he just got fired. Man 2 why . Man 1 network breach. Man 2 since when do they fire ceos for computer problems . Man 1 they got in through a vendor. Man 1 do you know how many vendors have access to our systems . Man 2 no. Man 1 hundreds, if you dont count the freelancers. Man 2 should i be worried . Man 1 you are the ceo. Its not just security. Its defense. Bae systems. Im a Customer Relationship im roy gmanager. Ith pg e. Anderson Valley Brewing company is definitely a leader in the adoption of energy efficiency. Pg e is a strong supporter of solar energy. We focus on helping our customers understand it and be able to apply it in the best way possible. Not only is it good for the environment, its good for the businesses bottom line. These are our neighbors. These are the people that we work with. That matters to me. I have three children that are going to grow up here and i want them to be able to enjoy all the things that i was able to enjoy. Together, were building a better california. Dow is up 130 points and s p is bumping up against what some traders feel is todays resistance level 2050 and the nasdaq is up half a percent. If youre real good, kelly will tell another economist joke sometime over the next couple of hours. Lets talk about tiffany, rising on better than expected earnings however full year earnings will be unchanged from last year as the lackluster Global Economy has hurt sales, stock up 2. 25 right now. Starwood hotels reaching a deal. 13 billion in cash topping marriotts offer by 15 . Marriott says its takeover offer is still the best. Theyll have to raise it if they want to get into the story. Dominic chu has a look at the surge in Foreign Companies doing deals here in the United States. Big numbers, dom. To add on the starwood discussion, one of the big shareholders, john paulson, Big Hedge Fund manager, just come out according to reuters with comments saying that he welcomes shocking right, this idea of another bitter looking at Starwood Hotels and good for the overall process. Thats breaking in the last few moments or so. Lets get back to the overall picture for it has been a pretty big year for 2016 year to date for cross border deals, specifically the ones targeting u. S. Based companies. Look at the broader stats, according to Richard Peterson at Global Market intelligence, they had about 250 billion in u. S. Volume so far year to date. 250 billion worth. 116 billion, thereabouts involve foreign buyers of those u. S. Assets. Thats about 46 . So nearly half of it is Foreign Companies trying to buys u. S. Companies or units. If you look at some of the biggest yields weve seen so far this year, among the top ten, around seven of them are Foreign Companies targeting the u. S. Ones here. Take a look at the biggest ones out here, shire looking to take over baxalta, anbang insurance trying to take over starwood. Trans canada yesterday trying to buy columbia pipe line, 14 billion. And fortis, looking to buy itc and hna buying ingram micro. Theres not enough room of course heyer trying to buy ges appliance unit and heavy industry in china as well. A big part of this picture so far but a lot of Foreign Companies trying to buy u. S. Assets driving the activity so far in 2016. All right, dom, thank you very much. Lets talk about why more foreign money is coming into the u. S. When it is. Joining our friend rich peterson from Global Market intelligence. Ris stick that jumps out of the top six all time chinese acquisitions in the u. S. , five have occurred this year. Thats amazing. Why now though . These are incredible numbers. I was pondering the data, deal trends and looked at the big deals. Obviously the starwood of anbang in lodging. Back in 2013, Chinese Group bout smithfield food and Package Goods and also recently deals in the entertainment business. I think these are bets on the consumer and still the growing middle class globally and not in the United States, not in asia, worldwide. These entities are looking to make bets on growing middle class worldwide. When chinese are cracking down on people transferring personal wealth out of the country, whether the companies are looking for the same type of diverse fiction. We dont know whats going on in terms of internal politics of these Firm Relationship to the chinese government. But the fact is we talked about as dominic chu said, of the top u. S. Deals this year, seven involve foreign buyers. In canada, the largest ever canadian acquisition in the u. S. Energy sector yesterday with transcanada making the bid for columbia pipeline. Last year record volume, 2. 3 trillion, 450 billion came from u. S. Companies buying abroad. Of the big chunk was pfizer making a bid for allergan. If you extrapolate year to date, well have a record year for foreign acquisitions in the United States. Are they getting a good deal . Ive been hearing a lot of chatter reminding people about the 1980s when the japanese were buying up u. S. Assets at that time and years later had to sell them back at pennies on dollar. Is that likely to happen this time around or are they getting a good value this time . You go back into the way back machine and the japanese were buying Rockefeller Center or pebble beach, buying luxury items in terms of Rockefeller Center, thats a commercial property. Maybe as opposed to now with starwood, more of a Residential Property and going back to my thesis, more of a bid on the middle class, looking at the different times, these numbers are phenomenal. How much more do you expect them to pick up . Were only midway through march here. The fact is theres rumors that German Chemical Company was maybe looking at breaking up the dow chemical dupont bid. A lot of companies in the world of negative Interest Rates, where are you going to put your money . Maybe in u. S. Assets. All of the deals better have good breakup fees, they are going to be needed. Leave that to the lawyers. Thanks, good to see you. Rich peterson. As we head towards the big expiration of the year, this third friday of the month of march, the dow up 128 points off the highs and s p stick holding at that 2050 level. What a tough week for Valeant Pharmaceuticals wiping out more than half its value, meg terrell will tell us if the worst is over. Financials are higher thanks to stock buyback increases at two the biggest banks, well look at the financials maybe have finally turned a corner coming up. Another strong rally day, interestingly it is the strongest of the three averages, both the s p and nasdaq half a percent higher. S p up 10 and nasdaq 23. Heres a look where the strength and weakness is in terms of sectors, industrials leading the way this week. Not just today but this week. You might wonder about names like caterpillar, you know some of the material industrial space thats been outperforming latedy. 3. 5 gain for industrials and 2. 5 higher for materials, and health care is the one in the red down about 2 this week. Lets look at other mover for this friday. Wynn resorts trading higher. Citing a new generation of vip gamblers coming into the area, expects this years Gross Revenue to fall only by 6 compared to the previous forecast of a 13 decline. Adobe systems notching gains today. You heard about it late yesterday. Reported better than expected earnings also gave up beat guidance for the Current Quarter as Digital Media sales surged at adobe shares of valeant are down again today. Meg terrell has a run through of challenges facing this troubled drug company. It has been a nightmare of a week for valeant and shareholders, if i loork at actually health care, this is the biotech etf mapped over that. Analysts are saying rest of health care has gotten hit whats going on with valeant. It is the only sector thats lost this week. Just to recap what was so bad with valeant this week and on tuesday they gave their Fourth Quarter earnings and forecast that was drastically lower than people expected and no clarity when theyll be able to file their 10k, that has a lot of implications for their 30 billion in debt. So that is what people are worried about right now. Mike pearson sending a memo saying some expressed concerns whether the company is on the verge of bankruptcy. I can assure you we are not. That has to do with time lines for filing a 10k, what is next for valeant . Anything that comes out as to what they are negotiating with their lenders over extending deadlines to file and potentially asset sales. The Company Plans to die vest of noncore assets to pay down debt faster. People will look for what assets there are and what type of terms they are going to go. That will affect sentiment, pretty much as bad as it can get right now. The journal pointed out too, the fact they have 17 billion in good will on the Balance Sheet looks suspect, the whole thing is only worth 10. 5 billion so. It will be interesting to see if people looking at the stock as long having fallen so much can push the valuation back up. Ive been asking around trying to find out if theres anybody that sees it as a long right now. Ill continue to make calls. Tough time to be selling assets at this time. Theres no way youll get a pretty penny for any of those and you wonder the fear could be that they are going to sell valuable assets that would help them grow in the future. A lot of people say the most valuable looking assets is something they probably shouldnt sell. Things they dont want, why would anyone else want them too. They are speculating over what it is that can be sold and valuations weve been seeing speculated on. There was a note from bmo which said one of the assets, female sexual dysfunction drug bought for a 1 billion maybe has a value little more than 300 million. Pretty distressed assets. Welcome back to the job, michael pearson, tough right now. Thanks so much, meg tirrell. We start with breaking news that were following out of belgium. An active Police Operation is under way in the town of mollenbeek. New vitd video from vtm shows an apparent arrest from todays raid. Its unclear if the person taken into custody is abdeslam or someone else. Police are at least looking for one more suspect. Two large explosions have been heard near the house where abdeslam was arrested. He had been on the run since cape escaping capture last november. Authorities believe he was the driver of the car that tooked armed gunmen to the bataclan theater in paris where 89 were killed. Todays operation follows another raid earlier in week also near brussels which resulted in the death of another man whose profile matches that of an isis fighter who wanted to be a suicide attacker according to documents obtained by nbc news. Were expecting to hear from belgiums prosecutor on todays events and in a few moments they will hold a News Conference. Well bring you any headlines when it occurs. But the operation is still ongoing, there are still riot police on the gound there in mollenbeek. The dow up 131 points today and s p up 9, transports having a good session. Nasdaq up 20. That 2050 number, traders were telling me to keep an eye on, still sitting right there. A leading trader will tell us what hes watching into the close next. A debatd over whether or not oils rally can last. We found a bull and bear. Well bring them together when we come back on closing bell after this. He has a sharp wit. A winning smile. And no chance of getting an athletic scholarship. And that is why you invest. The best returns arent just measured in dollars. Td ameritrade. The transports are having a nice rally day today. That index, about 122 points at the moment. American up 2 and delta up 3 . A lot of names and the rally continues to change. Were 26 minutes left in this trading session. Ive got kenny from oneill securities with me on the Trading Floor as we head towards the end of the first big expiration of the year, this day and already heavy volume. What do are you expecting to happen in the next 20 minutes . Theres going to be heavier volume. Huge imbalances, theyve been talking about 2. 3 billion to buy moc now starting to flip and its going to be big either way in terms of the volume but i think the market will hold right here, 2050 is the strike price. Were not going to 2070 or 2030. Well trade a lot of volume and the last minute of the day and the day will be over. Thats the pivot right there. You can feel it. Its right here all day hugging around that line. What was this rally about this week . How much of it was the relief rally about the fed and how much of it was getting ready for the xpoirgs . I would say 70 30, much more about the fed than the expiration. If the fed had maintained the line and still talked about four rate increases we wouldnt be trading here and would have found a different pivot point. But we got to here and found this level where theres decent resistance and thats where its going to pair off. Five weeks of gains, now what . I think over next week and a half until earnings season, we churn and got 2020 on the downside which was resistance now support. And i think we got right here, 2050, maybe 2070 as upside resistance but well be tight in the range until earnings season. Ill let you get ready for the expiration. See you. One gauge to watch is oil. Its been up for the past five weeks, 50 since february 12th. It seems to be a matter for debate. Larry mcdonald is acg analytics and cnbc contributor, president of lippow oil associates. Youre not a big fan, you think this is a sell at the moment . Bullish a month and a half ago on cnbc very vocally. What im disappointed in, we have a giant surge in oil but the spread between double b bonds and high yield bond market and triple cs is still 1,000 basis points. So credit is not buying in to a large degree relative to equities, number one. Number two, the producers, the guys chevrons of the world, guys that should know are aggressively selling on hedges and under hedge for 2016 and number three, youve got 3 to 4 trillion of debt. 3 to 4 trillion of debt thats tied to oil and emerging markets. As oil rises, people have to pay coupons and they have to increase production at a level where historically they wouldnt have to do so much of that because of debt. They have to increase production at these levels. Andy, like stocks, oil has had a pretty good five weeks here, big rallies and how much higher if youre bullish, how much higher could we go do you think . I think we can get to 50 a barrel at the end of the year for a couple of reasons. First weve got iranian oil. Its back in the market. But probably less volume than the market is expected. We continue to see u. S. Production declining and i think its going to decline more than people expect. And i dont think the banks will be lendsing as much as they like and the third thing, were seeing a significant amount of supply disruptions between nigeria and iraq taking barrels off the market. Do you know where the missing 800,000 barrels a day are . Are you familiar with this . What do you think is going on . What it could be really is that the iea is understating demand at the same time they are overstating what the supply is. And theyll make a revision later on in the year and what were seeing actually is not really a 2 million barrel a day surplus because the Market Structure is certainly not deep enough to recognize that kind of oversupply. Were certainly not seeing that amount of ves sells storing crude oil. I know you went through a litany of pretty sophisticated reasons why you think oil is going to go lower. Couldnt it be as simple as supply and demand . Supply is coming down and all opec has had to do is jaw bone this market. Threatening they are going to freeze production. Weve already seen a number of companies go offline here in the United States and demand, the api numbers, tremendous demand for gasoline and for oil out there right now. Wouldnt that push prices higher. The one thing thats going to impact demand is the fed. Economists have lectured us how strong this economy is for a year. And the fed still has two hikes in the dots and average economist thinks the fed will hike two to three times this year across the street. That means that you know, its march, that means the market will have to start pricing in hikes and what weve seen over and over again is the credit will veto the fed policy path. In other words as they start to price in hikes, oil dollar will move higher again as we saw all last year and beginning of this year, higher dollar, lower oil and whole cycle keeps repeating itself. How quickly do you think supply could get back up and running as oil prices do rise . As they do towards the 50 mark. Some say it could come online in a second and others say between people having left the industry and capital depreciating that wouldnt happen and price would be able to shoot much higher. I think its going to take a good six or eight months. Its not like oil prices will rise and were going to bring on all of these unkpleelted wells all at once. You have to get the worker and rigs and mobilize people in the field. One thing ill point out on nand demand, seasonally demand will go up 2 Million Barrels a day and oversupply which will give the market a new look on prices. Past the recent lows . The this is a secular bear, other side of the mountain. They end in long valley and back to 30 to 32. Look at the gold market. Gold bounced on bottom for 18 months and then we sought coming into a real bull market. Good discussion. Larry mcdonald, good to see you. 20 minutes to go and were hanging on to gains, well watch again to see what kind of volume were talking about on the close. And dow is up 135 points and s p nearly 10. At 2050. Big Banks Banking on themselves, bank of america, latest to join the list of financials buying back their own stock and bob pisani will break that down. You may be forbidden from taking a selfie at the Australian Open or running with the bulls in pamplona but it may be the new and easy way to shop on amazon. Well see if this is the end of western civilization or brilliant e commerce. Ashley bryant, you are a teacher of small children. Thats right. I have read it is the hardest job in the world. Thats why im here. Can you. I can offer advice from the accumulated knowledge of other educators. Thats wonderful but. I can tailor a curriculum for each student by crossreferencing aptitude, development, geography. Sorry to interrupt. But i just have one question how do i keep them quiet . pause watson . There is no known solution. Yeah, i was just talking uhabout yourico . Emergency Roadside Service and how its available 24 7 and then our car overheated. What are the chances . Can you send a tow truck please . Uh, the location . Youre not going to believe this but its um. Its in a tree. I wish i was joking, mate, but its literally stuck in a tree. car horn honking a chainsaw . No, no, all we really need is a tow truck. Day or night, geicos emergency Roadside Service is there for you. Hey, jesse. Who are you . Im vern, the orange money retirement rabbit from voya. Orange money represents the money you put away for retirement. Over time, your money could multiply. Hello, all of you. Get organized at voya. Com. The dow up 128 and s p up 9 and sea World Entertainment is jump and wells fargo upgraded the stock to outperform citing the new path to improved attendance. You have probably heard they would stop breeding killer whales and forcing them to perform tricks at its theme parks. Attendance fell after the 2013 documentary called black fish was released. It was critical of sea worlds orka program. I didnt realize they can live 50 years, existing ones. I had no idea. Financials are the best performance, both are buying back stock here. Lets bring in bob pisani. They are all up. It may be a vote of confidence in the banks by the Federal Reserve. First jp morgan, buyback 1. 8 billion. Remember they had a 6. 4 billion buyback they authorized just last year. So that stock is trading on the upside and jp morgan the highest level since january. You see the interday moves. Whats going on with Bank Buybacks here. Wells fargo had one back in january. It is a positive sign. The feds have to give nods to Bank Buybacks and i think it implies capital base is stronger for banks and they can afford to spend money to reduce their share account. Come back to me a minute. Bank of america also authorized a shared buyback, up 3 . 800 million. They had a 400 million Share Repurchase but also said that they are offsetting a share count dilute gs and not reducing the actual share account out there. Look at the banks, all trading up. Remember the banks have lagged this week because generally rates have been done. Bond yields have been done and thats hurt the banks but today all of them are out performing very nicely. Finally, i want to make you away, we have a rebalancing at the s p at the close. Four or five or six stocks having shared count reductions, all of these are having shared count reductions. Youll see a lot of volume. This will probably be the biggest volume day of the year. And what was monday . Monday would be the second biggest it was the lowest volume day of the year. We started with the lowest and well finish with the biggest one, that kind of week. Thank you. Sorry, i didnt mean to trip him up yet. It has been pretty light around here. The dow is up 129 points and paced by the financials and goldman and jp morgan up 3 and s p up 10 points. When the market seeing green 12 of the last 14 days, our next guest says the rally is just getting started. Hell explain when we come back. I invest with e trade, where investors can investigate and invest in vests. Or not in vests. This is my retirement. Retiring retired tires. And i never get tired of it. Are you entirely prepared to retire . Plan your never tiring retiring retired tires retirement with e trade. Plan your never tiring retiring retired tires retirement our cosmetics line was a hit. The orders were rushing in. I could feel our deadlines racing towards us. We didnt need a loan. We needed shortterm funding fast. Building 18 homes in 4 ½ months . That was a leap. But i knew i could rely on American Express to help me buy those building materials. Amex helped me buy the inventory i needed. Our amex helped us fill the orders. Just like that. Another step on the journey. Will you be ready when growth presents itself . Realize your buying power at open. Com as we head to the close with the huge expiration, art cashin pointed out we have 1. 6 billion to buy on close orders, thats the imbalance right now. Kenny thinks a lot of that will pair off. The s p still sitting on the 2050 strike price as we head towards the expiration. Joining us here on the floor, david from matrix asset management. We were talking about the buybacks and you like the financials. But arent you supposed to like those when the fed will raise rates . The fed will ultimately raise rates. The market up 12 in the last six weeks and factors that have taken it up will kick in with the banks. We think theres going to be a lot of catchup and more selling at 10, 11 times earnings. Energy portfolios will be bad with energy pliss rebounding. Would you be selective . We have goldman and morgan and regional banks on oil exposure have gotten hit. Go to the money center banks. Are there any particular parts of the Banking Sector you do and dont like . We think the Group Overall will come up. We like the jp morgan and wells fargo best and Morgan Stanley and goldman sachs. Here we are at the end of the five weeks of rallies, five weeks of gains for the tomorrow. We quoted you in the tease as saying you think the rally is just getting started. Weve been saying buy you said five weeks ago. We were on the air saying buy aggressively on the dips. We think its going to be a 9 to 11 year with a great deal of volatility. We had a 12 jump. We think it will slow down and youll have ups and downs, the next 5 pull back, when things look very bad, usually you can put money to work and make money. We wouldnt chase this rally. When theres a pullback, buy because stocks end up 9, 11 . Would you go with leaders from the recent lows, materials and industrials and transport kind of names or a space Like Health Care thats been harder hit . We think the industrials that have started the turnup will do better. So we like a company like Johnson Controls and united technologies. In terms of health care, much more selected, a gilead will do well and zimer. We wouldnt buy it whole sale. One group we are weary of, utilities, we would be taking money out of utilities. If you look at them on a valuation basis, selling 17 or 18 times earnings, even though yields are okay, thats the extreme over the last you anticipated my question. They have been leading this market and continue to be unloved in many cases, theres a lot of skepticism. I would go with growth someone is buying them. The etfs, theres a lot of flow of money and when they get money have to put it to work immediately and we can see the stocks moving up without a lot of strength. Thank you so much. Were coming back with a closing countdown as we head towards the expiration. Dow up 121 points. If a new 4inch iphone sends a chill up your spine or smaller ipad has you excited, monday will be for you. Well preview both stories coming up. Youre watching cnbc, first in business worldwide. Trolling for a gig with braindrone . Cant blame you. Its a drone you control with your brain, which controls your thumbs, which control this joystick. No, im actually over at the ge booth. Were creating the operating system for industry. Its called predix. Its gonna change the way the world works. Ok, im telling my brain to tell the drone to get you a copy of my resume. Umm, maybe keep your hands on the controller. Look out ohhhhhhhhhh. You know what, im just gonna email it to you. Yeah thats probably safer. Ok, cool. In new york state, we believe tomorrow starts today. All across the state, the economy is growing, with creative new business incentives, the lowest taxes in decades, and new infrastructure for a new generation attracting the talent and companies of tomorrow. Like in rochester, with worldclass botox. And in buffalo, where medicine meets the future. Let us help grow your companys tomorrow today at business. Ny. Gov i am benedict arnold, the infamous traitor. And i know a thing or two about trading. So i trade with e trade, where true traders trade on a trademarked trade platform that has all the. Get off the computer traitor i wont. cannon sound mobility is very important to me. Thats why i use e trade mobile. Its on all my mobile devices, so it suits my mobile lifestyle. And it keeps my investments fully mobile. Even when im on the move. Ahhh. Three minutes left, im going to go to the twitter sphere with that one, talking about the 10,000 bill. Is it still in circulation . Let us know. On the cover on the face of the 10,000 bill. We go back to february 11th and weve had five consecutive weeks of gains for the stock market and in that time bob pisani, the dow is up more than 10 . Were finishing the week at the highs for the year. Any positive wti crude a little lower today in the fiveweek period we had a gain of 43 . Is that what that says . Just under 40 a barrel. The 10year yield in that fiveweek time as stocks and oil were going lower, were also moving higher at 1. 87 on that 10year and the vix boy has that gotten clobbered. Were now below just dropped below 14. Here we go, two minutes left, a lot of volume coming in. Well do this may be the biggest volume day of the whole year, maybe throughout the remaining nine months or so. Well probably do a billion shares right at the close. As far as the week goes, this was the week for the dollar and the weak dollar put up the dollar down over 1 for the week. And that helps fuel a big rally in material stocks and Energy Stocks as well as in industrial stocks. A lot of chatter whether theres coordinated activity going on among Central Banks to push that lower. Interesting pictures of janet yellen talking to central bankers and jack lew, no formal statements but this is out there. Its in the best interest of the economy to have a strong dollar. Thats absolutely true. Thats what we always hear. Heres the key stocks to watch at the close, a number of big names are having share count reductions due to buyback programs we had. Ge and apple and mcdonalds, the name of the game is reduce the share count but did not influence the price. Theres a lot of machinations going on. All you want to do is move around a lot of volume here and shares. Facebook is having an addition rather significant add to their waiting in the s p 500. Right here at close, right at the highs for the week and s p now in positive territory for the year. The only debate is whether or not this weakness in the dollar will continue. As we get closer to june more likely fed hike will that weak dollar continue to hold. Thats what were keying off off. Thank you, macys is ringing the closing bell. At the nasdaq, its the new York City Mission society. Stay tuned for the second hour of closing bell with kelly evans and company. Enjoy your weekend. [ applause ] welcome to closing bell. Lets look how markets went out with big volume on the bell there. Its an options expiration day, dow up 113 points paced by financials and jp morgan and goldman. Another strong session and broad market s p 500 could be quite close, were watching that level in the market and s p up 8 points,. 4 . Same kind of gain for nasdaq there which closed up 20. Joining todays panel, senior markets commentator mike santoli and for more on todays market action, tim seymour joins us as well. Five weeks of gains from the lows. Five weeks of gains, first time we had five weeks which each was up 1 . Since the very beginning of the bull market in april of 2009. Really applauding kind of impressively resilient performance. We did close out right hugging that 2050 mark. No surprise given it was an options expiration. I think the talk now has to be comparing this rally to the rally we saw at the end of the september into early november. Exactly the same magnitude, 12 on the s p 500, got up to a lower high. Vix went down to 14. A lot of stuff fits. I dont think that means it fails badly but its going a long way in a hurry. It does seem they have been sharp and swift. Every time we had a correction its come roaring back. We may have the biggest turnaround for the quarter. Remember back in february and january and china and u. S. Economy, we were all freaking out, markets were entirely freaking out. Those predictions of doom did not happen but i must say that the conditions in in place across the Global Economy with Central Banks pumping and pumping with deflation and problems in china, i dont think the major macro problems have been resolved in five weeks. It seems like we were bailed out by the better u. S. Economic data and if we were looking to the central bank or bank of japan, are they achieving what they are trying to achieve here . We know in terms of weakening currencies, its not working. Thats one of the reasons why the dollar is weakening. Youve almost got to acknowledgement from the ecb, maybe even bank of japan that theres limited sponsor reaction. Negative Interest Rates didnt work. Are they stepping back from aggressive ecb said we have to lower rates. My phone going off here, sorry. Thedy vergence between Central Banks not as great as people thought, thats pushing the dollar down because the fed doesnt have to be more aggressive than everyone else. Industrial output out of europe has been fantastic. You had empire fed and this week you had philly fed which were much better, maybe getting a bounce on the industrial side. Everybody that said recession and credit disaster and china yuan, these are things that really you cant play for a credit event as an Equity Investor and people overtraded this market. The problem though a lot of momentum, playing into the growth story here and its going to be hard to get much better for improvement to keep building. You have that factor and issues out of china which the first time we see evidence that the outflows are picking up again, you could get the whole negative psychology. What youre playing is the swings in perception of an Economic Situation that real sli isnt changing that radically. The markets are moving more dramatically than conditions fundamentally and you got this rally that unwound a lot of first fears but get to this level and say did the market get cheap . Not really. Did big things get fixed . No, you about they werent as broken as we thought they may have been at the low. It doesnt mean again that we cant stretch it higher. If you have a fed thats a more measured pace and Economic Data continue to come through, we can bridge ourselves right to the earnings reporting season and guess what, they dont have to blame the dollar any more. We mentioned a lot of people seem to be taking money out of the big winners last year, amazon, netflix, alphabets of the world and putting them in a broader basket of stocks, including transports and industrials look at caterpillar after it really lowered its outlook. It seems like a corner is being turned there. So far this year, you know, i really find it interesting whether the market will respond with the intensity on the downside. If there are upside surprises about u. S. Economy, perhaps you see inflation in europe which is kind of a fantasy but lets say you do see that and see positive things out of china. Will there be a positive surprise . Were almost elated here but lets keep in mind that the u. S. Stock markets are basically flat for the year. It seems up but its really flat. Were back where we started in january. Economic conditions remain as my Great College says, were suffering from a chronic condition and not acute condition, chronic condition of low Economic Growth around the world. No surprise, that has pushed people into parts of the market like utilities and dividend payers where they perceive they are a little safer and ride out the storms and get a good yield which you cant find in the fixed income space. These parts of the market are becoming expensive. Very expensive. What would you do when youre faced with paying up for those areas or going to more parts that could be more vulnerable . Im not sure you have much value left, but i could make an argument that the stock market should be trading expensive based upon where fixed income yields are. The s p in the defensive and personal household goods, some of the food products, cokes and mcdonalds, these are not cheap stocks but when you consider the dividend yield and Balance Sheet of these companies, i would argue that they may still trade expensive and should trade expensive. The bar bell that has been those stocks and emerging markets and industrials and the things you talked about largely worked. To suddenly say they are not going to work is to try to overtrade this market. Everybody is saying either the economy is not that good and everybody has been wrong in terms of where this thing is going. Actually, lets get more on that. Just so everybody knows, art cashin said we did more than a billion on the close, an indication of finally seeing real pickup in volume in this market. To what tim was just talking about, everyone being wrong into the year it has been a brutal period for hedge funds for a lot of active management strategies. How bad . The favorite stocks of hedge funds as measured by Goldman Sacks down 6 into this week. Were at about a flat market. Obviously lots of crowded trades got punished. We know bill ackman got buried in Valeant Pharmaceuticals and kef griffin, his biggest strategy, down through march 11th. These are relatively big losses. When you ask why not just favorite stocks underperformed and gone down but least owned stocks have been the best performing. Utilities, consumer staples, big boring dividend stocks. The question is, is this a passing storm or just their strategies are out of favor . I think you got a market last year very picked over and no longer cheap and the credit market rebelled a little bit. Therefore the activist and Financial Engineering strategies didnt go so well. You have a lot of people crowded into a hand hl of ideas they thought could work. There are a lot of Pension Funds and all of this kind of money tied up in Hedge Fund Strategies supposed to help them right oud storms. Those are getting increasingly uncomfortable with the amount in hedge funds. Big numbers still going in there but percentage is on the decline. I expect around kentucky kerr by time, first saturday in may, kelly, for us to be talking about hedge fund withdrawals. And end of the quarter at march, there might be a few weeks of notice about withdrawals and redemptions and perhaps mid april into may well be talking about hedge funds redemptions. I wonder how much is locked up for pershing or one or all of the funds, only can withdraw an eighth of the money at a time. They are trying to make it trickier pershing is unique. They were able to set terms with their investors when they had all of the power. They do not have that leverage and i expect to be a lot of discussion about Hedge Fund Redemptions and closures. Beyond this move as well, the response would be for the funds themselves to Start Playing around the with fees they are charging and maybe say were not justifying two and 20. Then what . Thats been the story for a while. As dennis suggested, funds folded up. If they dont catch lightning in a bottle. They would rather just followd and start again. Bigger funds for bigger clients they will negotiate fees, not a flat take it or leave it thing. In general its a luxury good. Part of the sales proposition, we only make money when you make money. Give us resources to do that and well get it done. A percentage of inflows going to the most established funds. Its tough to be a startup hedge fund right now. Alignment of interest is very important. Ive been a Hedge Fund Manager for the past few years, its all about i get paid when you perform. I think the Fee Structure is coming down but to say that a lot of these guys are packing up shop, i think the big are getting bigger and therefore they are not doing as well. The other problem with the market right now, theres too much index huggers and etfization has meant that they are trading around the index. Hedge funds should outperform that market. If you with pick stocks and noncorrelated. Thats the best way to outperform. When everything is going up, hedge funds will underperform because they are paid to be hedging off risks that tlarnlgly over the course of five or six or seven years wasnt really there. I think they under perform because they are beating themselves up at the lows. Of course we saw in the beginning of this year hedge funds were supposed to be providing protection. They did not. They over underperformed if i may use that term. I dont know if thats been the case so far. Im not sure we can judge hedge funds until the end of the quarter at the minimum. If youre judging on a month to month basis which a lot are paid to do, a lot of guys may have overtraded but i would imagine the First Quarter unless you were in a crowded trade like long dollar, short high yield, you probably did protect risk for investors in that quarter. Thanks for joining us. Be sure to stick around for fast money at 5 00. Guy adami gets a look inside dominos 17 rally this month. There he is in the kitchen. Dont miss it. We have a news alert ahead of next weeks primaries, whats happening . We have a new statement from former republican president ial candidate mitt romney weighing in on the side of ted cruz now ahead of the utah caucus vote next tuesday. Heres what mitt romney had to say in the statement he put out within the past couple of minutes. At this stage, the only way we can reach an open convention is for senator cruz to be successful in as many of the remaining nominating elections as possible. He says i like governor john kasich, i would have voted for him in ohio but a vote for governor kasich in future contests makes it extremely likely that trumpism can prevail. Almost endorsing ted cruz saying that he likes john kasich. Why is this important . Well see that caucus in utah on tuesday. Obviously in utah theres a substantial mormon vote and many of those voters may look to mitt romney for guidance how to vote and arizona voting on tuesday as well. Mitt romney trying to tip scales in favor of ted cruz at least temporarily and get to an open convention which he says is the goal here. Does mitt romney have any pull outside of perhaps state of utah . Do people care what he has to say . I dont think the voters who are voting for donald trump dont care what mitt romney has to say. Youre right. In utah there could be a distinction and thats coming up on tuesday. The timing is so interesting. The question i have, how convoluted this voting strategy is and the end game for the trump campaign, folks who dont want to see donald trump at all, tell being people who like john case itch, they should vote and getting john kasich down the line in an open convention which maybe could happen is a string of ifs and what ifs and therefores thats complicated for voters to follow. They are used to voting for the candidate they want to see as president of the United States. Whether this will work or not is an open question. Interesting twist on the eve of utahs primary. Its not just tim cook saying the fbi is overstepping bounds. Up next, well tell you who else the tech giant is refusing to work with the government. You can pay with your phone and watch and soon might be able seriously to pay with your face, amazon wants to patent a pay by selfie technology. The risks and rewards of that system coming up. Sales event is on. With extraordinary offers on the exhilarating is. The thrilling gs. And the powerful rc coupe. This is the pursuit of perfection. Man 1 he just got fired. Man 2 why . Man 1 network breach. Man 2 since when do they fire ceos for computer problems . Man 1 they got in through a vendor. Man 1 do you know how many vendors have access to our systems . Man 2 no. Man 1 hundreds, if you dont count the freelancers. Man 2 should i be worried . Man 1 you are the ceo. Its not just security. Its defense. Bae systems. The fbi facing head winds in the fight to help apple hack into the shooters iphone. Even if they win in court there could be another roadblock eamon has those details. Big story raising this intriguing possibility here in the apple versus fbi fight and possibility is this, that if apple were to lose in court over the issue of whether or not they should create new software to unlock the iphone of the San Bernardino shooter farook, if they lose that case in court, some apple engineers cohen gauge in Software Version of civil diso bead yens and quit jobs at apple in order to not have to comply with the governments demand. Apple said it would take six to ten years a month to write the government operating system or government os. They say that would be relatively doable and tim cook has said that if apple loses in court, it would comply ultimately with what the court is asking apple to do. The risk here is not to engineers. The Software Market is so hot for programmers in Silicon Valley. These people could likely find other jobs at other firms and would be snapped up quickly. The potential is foredamage actually to apple if they lose their top programming talent over this fight with the government. A fascinating wrinkle in whether or not well see Silicon Valley civil disobedience that could be an intriguing point. Thank you again. Before apple heads to court tuesday, having an event on monday expected to introduce a new iphone and ipad. The stock is up 10 but the except tickism that the new products will do much for shareholders going forward. Brian white, global head of technology of hardware and software and max wolf at manhattan venture partners. I know you like the company and the product line. But why are these two properties in particular going to resonate here, smaller new iphone and new ipad . This is he vent is a stepping stone to a recovery in apple stock and were looking forward to the iphone 7 in september. Theres incremental positives. One is the mid range smartphone market, apple cant tap into that. They tried with a 5c, price point only 100 cheaper and features werent there. I think the iphone 6c can tap into the markets. 80 is coming from asia this decade. Do you think its the right strategy to try this one again . I think its worth another shot. I think that apple is a premium phone provider and foras into Everything Else can be more sort of mixed than we would have expected. Theres a risk well see a slightly underweming event. Any time you have an event and part of the excitement is watch bands im not sure its an edge of the seats scenario. I do think its probably positive. I think the stock is oversold like apple where its headed dont know if im totally bought in on the idea the event is a big game changer. Whats your price target . 200 price target and thats based on 18 times our 2017 estimate plus net cash per share. If you look at the d. C. F model, you can get over 200. This is one of the cheapest tech stocks in the world which has been true for a while. It has been true. People just view it as this is a nokia, motorola, theyll go by the wayside. Thats not happening. The competitors have been struggling and its going to be tough today and in tomorrow and the future. Do you know there will be any precedent of the market looking at the Largest Company in the market and getting it wrong by 100 in terms of valuation . I would say this. Forget about the absolute cap because apple is gobbling up industries, right. Books, camera, although market cap is being concentrated under the apple umbrella in my vi view. Im talking about how plausible, most widely followed in the world to be that badly understood . Sfwl i think the valuation will expand. I have no doubt in my mind this multiple can expand from this level. I think its a bit oversold. I dont see it going above 145 or 150 unless they show she can get into another industry and dominate. The watch still kind of not quite clear and ipad taking on a little bit of water. It would be nice to see better news. He think apple is still the leader and still luxury in the space. But i also think the truth is and were beginning to see the age of the smartphone as the new product is probably a bit long in the tooth. We need to see them dominate what comes next, vr or augmented realty or something else. They are not yet a motorola, if they dont come up with something in the next couple of months, well look back on the good old days. That would certainly be a stretch. Guys, thank you. Brian white and max woefl. Apples big event is monday. Tif, tax increment financing, a town in utah that pulled itself back from the brink. And known for stunning visual and sound equipment, looking at the science and engineering that goes on in their labs, 100 plus of them. Something youll want to see and more importantly hear later on the closing bell. Eres a lot s you never want to see 7. 95. [ beep ] but youll be glad to see it here. Fidelity where smarter investors will always be. If only the signs were as obvious when you trade. Fidelitys active trader pro can help you find smarter entry and exit points and can help protect your potential profits. Fidelity where smarter investors will always be. Tavi gevinson. Trendsetter, tastemaker, and teenager. Watson, you sound like a fan. Millions look to you for advice. I know. I cant believe it. I am learning to analyze social media to spot trends and predict demand. Sounds like you spend a lot of time online . I constantly absorb online content to follow shifts in pop culture. So. Youre learning to think like a teenager . Yes. How am i doing . Well. Uh. We have a news alert. An update on the xpengs of two ceos from two Different Companies pepsi ceo and 2015, total compensation, 26. 4 million, thats up from the 22. 5 million she made in 2014. Keep in mind shares of pepsi during the year of 2015 gaining 3. 5 . Lets switch focus to larry fink, blackrock the biggest investor with 4. 6 trillion in assets, up 8 , 25. 8 million versus the 23. 9 million fink made in 2014. Kelly . A fugitive suspected of the terror attacks in paris was captured in belgium today. Belgiums Prime Minister and french president Francois Hollande just wrapping up a big News Conference moments ago confirmed details about todays raid in the plussels suburb of mollenbeek. Among the headlines, Authorities Say two others in addition to abdeslam were taken into custody. Hollande said hell seek quick extradition of the paris suspect for interrogation. The french president warning the threat of terror is very high, add gs there are more people involved with the november attack than anyone previously thought. Just before the News Conference, dramatic video from belgium tv station vtm, which was released which appears to show an arrest from that particular raid as of now its unclear whether the person you see there taken into custody was abdeslam or someone else. However that person was shot in the leg. The paris suspect had been on the run from authorities since escaping capture last november at the french belgian border. They believe he was the driver of the car that tooked arm gunmen to the bataclan where 89 were killed. The white house said it is closely monitoring the situation and was in close contact with its Counter Terrorism partners in europe. Belgiums Prime Minister tweeting a photo of him on the phone with president obama. And kelly, one of the last things the french president said, pretty chilly, the Terror Network is extremely large. It covers several countries. And that was how they closed out the News Conference. So pretty chilling words there and they are going to continue looking. Theres still one more suspect at large. Back to you. Wow. Chilling indeed. Thank you so much, sue herrera. Facial recognition, thats what amazon is betting on in the latest way to pay. How secure is this technology . Thats when we come right back. Stay tuned all across the state, the economy is growing, with creative new business incentives, the lowest taxes in decades, and new infrastructure for a new generation attracting the talent and companies of tomorrow. Like in rochester, with worldclass botox. And in buffalo, where medicine meets the future. Let us help grow your companys tomorrow today at business. Ny. Gov man 1 i came as fast as i man 2 this isnt public yet. Man 1 what isnt . Man 2 weve been attacked. Man 1 the network . Man 2 shhhh. Man 1 when did this happen . Man 2 over the last six months. Man 1 how did we miss it . Man 2 we caught it, just not in time. Man 1 who . How . Man 2 not sure, probably offshore, foreign, pros. Man 1 what did they get . Man 2 what didnt they get. Man 1 i need to call mike. Man 2 dont use your phone. Its not just security, its defense. Bae systems. We talked about the hedge fund weakness, our next guest is sticking with them, president of bria college in kentucky. Invests 15 with hedge funds and joins us with more. When we spoke about how your endowment keeps College Tuition free. This is a critical issue, how this 15 of your portfolio is doing. Whats your view on hedge funds in light of recent performance here. Thank you for welcoming me back. Our view any time one of our positions is lagging is thats not a good thing but on the other hand those hedge funds were important to us in the recent down turn. They did less poorly than the other investments. Are you referring to the o 8 09 period. I was referring to the most recent, the last several months in our case while the whole market was down almost 10 our hedge funds were down only about 4. You dont have a problem paying, lyle, what kind of fees are we talking about here . I dont know the fees im talking about. Thats how we look at things. And can we put it in context today, the Market Selling off and they are contributing what to your performance here . Well, they actually held up better as i said than the rest of the market during december and january and as a result we were able to i was hoping that wouldnt happen. There were some technical difficulties. Lyle, one more question, are you going to stick with hedge funds here going forwards . Got any concerns in light of the recent performance and headlines, anything like that . No, were long term investors and we have a sense that hedge funds play an important part in our portfolio, reducing volatility and hopefully achieving market returns. And i think he made his point. We appreciate you joining us there. Working on those technical difficulties. From enhanced sounds and colors and monitoring body temps in theaters, dolby is making sin mattic experiences feel real, including tvs that listen to you. Hey ho hello. So much more of my tour of the dolby labs is next. Youre watching cnbc, first in business worldwide. Those new glasses . They are. Do i look smarter . Yeah, a little. Youre making money now, are you investing . Well, ive been doing some research. Let me introduce you to our broker. How much does he charge . I dont know. Okay. Uh, do you get your fees back if youre not happy . dad laughs wow, youre laughing. Thats not the way the world works. Well, the worlds changing. Are you asking enough questions about the way your wealth is managed . Wealth management, at charles schwab. Our cosmetics line was a hit. The orders were rushing in. I could feel our deadlines racing towards us. We didnt need a loan. We needed shortterm funding fast. Building 18 homes in 4 ½ months . That was a leap. But i knew i could rely on American Express to help me buy those building materials. Amex helped me buy the inventory i needed. Our amex helped us fill the orders. Just like that. Another step on the journey. Will you be ready when growth presents itself . Realize your buying power at open. Com amazon filing a Patent Application for pay by selfie, to make purchasing safer by relying on images of themselves rather than a password. Jason delray joins us from recode. How feasible is this . Do you think its going to work . I think its definitely feasible. A couple of companies are working on it master card and alibabas payment affiliate and amazon and other security companies. I think the main goal for amazon is a, making the buying experience on mobile as quick and easy as possible. If this is easier than typing in a pass word, it would do it. Then b, making Online Shopping safer at a time when a lot of fraud that was happening in brick and Mortar Stores is now coming online. I use the amazon app on my phone partly because it is so easy. Once you log into the app its actually very straight forward. I dont think id want to have to take a selfie frankly. Is this for people who would be using it for a browser or something . I think theres a couple of pieces of context that are important. One is the original this originally serviced in 2012. This was before Fingerprint Technology on phones was common. And so theres a chance that theyve moved past this and fingerprints the way to go. But i think there are other i think there are plenty of people who dont own a phone where you know, fingerprint is common. And then the other piece is there are people who are not regular amazon shoppers that dont shop through the app. So perhaps theres a browser way for this to work. Well, its amazing to see it. It seems eventually biometrics will take over. It seems inevitable. But it is remarkable as well when you consider, were so concerned about the fbi getting access to our information but weve nonetheless made this bargain, whether conscious of it or not, the companies have a tremendous amount of information about us and whether its a biometric face or thumb print, we somehow seem to trust them and giving them more power and information than the government themselv them s themself. Its true, going on for a while. Facebook is one big example. Amazon has my payment information, my address, my history of my life essentially. So i dont see that being a huge hurdle here if they wanted to do it. Another potential application is im covering another Patent Application a year ago involving physical stores related to amazon and the idea you would walk out of a store potentially an amazon store with an item without stopping to pay at a checkout counter. There was some mention of cameras in that, which is sounds even more creepier than this. But its something im keeping sort of in the back of my mind when i talk to my sources over there and former amazon employees. Jason, maybe to push back a little bit on this idea it is really so ominous, any time youre giving a password, youre essentially authentic ating information youve already given to them, correct . Youre saying yes, this in fact is me so they are going to match my selfie to something on file . Exactly. Youre right. I wouldnt argue with that. Well, whether its used in stores or on phones what here the angle you take a selfie, the picture can come out very different, a lot of chin or forehead in there. Jason, thanks very much. Its not just amazon using cutting edge technology, jackie chan cinema adding dolby theater screens in their theaters, i took a closer look at the Science Behind sight and sound. Weve brought to life dolb vision projection system, which creates levels of contrast never experienced. People are paying upwards of 20 a ticket, do you feel theyll pay even more for your experience . If you invest in the quality of the experience, it will bring people back to the cinema. Its an amazing experience xbl p of us watching movies and videos on our phones. The color quality isnt that great. Are you going to try to change that too . Absolutely. Were doing that today on the sound side. We have a number of partners like lg, lenovo and amazon incorporating our technologies and see that as an continued area of focus and growth. Im excited to try it out myself. Were entering the studio, our laser lab and were going to introduce you to the magic behind dolby cinema. This is a 500 pound door. No one can escape or get in. Were going to do a side by side. You can see blacks become truly black and we still have the ability to do those bright highlights. So you can imagine a star wars scene in space where youve got the deep, deep blacks and still the full brightness when im watching movies i can kind of see the screen im watching it on. Thats right. That was not the case when you were showing us most things, the fire blast or the text, it was more hilike watching it weve been doing demonstrations with augmented reality. Is it going to be mainly for lasers or move on to different screens . Wherever theres an audio visual experience, we believe we can make it better. On the left, this is what youre working on . Thats right. This is bringing High Contrast experience to the living room. You have some partners in terms of now all of these tv makers trying to incorporate this technology . Absolutely. In fact, vizio is shipping a Dolby Vision Television today . How much does it cost . That tv is about 4,000. Welcome to our physiology lab. What does that mean . Wait a minute. You can see us there. Our mission is to create these really compelling experiences. That all starts with the science of sight and sound. For us that literally starts with understanding how the brain processes sight and sound. This is the kind of thing when people are watching the revenant and saying they felt so cold, that the fisology of what were talking about . Absolutely. On your head we put an eg sensor and we have 32 channels that are able to capture small neural responses. We have on your hand youre wearing a sensor that allows us to capture your heart rate. We can capture small changes in the conductance of your sweat glands and that tells us about changes in the excitement that youre experiencing when youre watching. Well take these technologies and sit side by side with the artist and directors and sound designers and we generally dont wire them up like this. But we know were on to something when they say, wow, i can shoot shots and ive ways to tell my story i did not have before. Kelly, were on the floor dedicated to our broadcast team. And the art installation on this floor is an interactive one. You know, you clap or make noise and youll see that the monitors respond and its just meant the tvs are listening to us . Hey, ho i know this is an art exhibit but obviously if it can detect noise and respond to it, it can use that in a host of other ways. Its meant to be interactive and helps you think about how sight and sound affects your life. A lot of us havent thought about dolby since the surround system system days. Whats interesting the company realized and not just about sound but vision, contrast is a big thing. You can buy a tv with 4k technology and focus on the contrast element of the images they are working on the outcome is vastly different as you can even see through the shouts we were taking. They have to preserve the specialness or just kind of raise the bar constantly. I remember when surround sound was a thing and in theaters, superman in the 70s. Each person is visiting the cinema less and hanging over everything is virtual reality. Why do you need to go see all of those screens when you can sit at home with a set on your head . I think the point is they want you to still go to the theater and put the set on your head. As long as theres innovation and technology hes making the case that the cutting edge place to experience that is still perhaps in a theater. I dont know if thats true but there might be an argument that the image quality and whole experience, you probably arent going to have the equipment at home you might be able to access in a place like that. Certainly something to watch. You can check out much more on the spark cnbc. Com thespark. One utah town was once on the brink of desolation, which ones are taking advantage of the towns successful renaissance when we come right back. On our disciplined approach to find long term value. So wherever your Retirement Journey takes you, we can help you reach your goals. Call a t. Rowe price retirement specialist or your advisor. To see how we can help make the most of your retirement savings. T. Rowe price. Invest with confidence. When youre on hold, your business is on hold. Thats why comcast business doesnt leave you there. When you call, a Small Business expert will answer you in about 30 seconds. No annoying hold music. Just a real person, real fast. Whenever you need them. Great, thats what i said. So your business can get back to business. Sounds like my rides ready. Dont get stuck on hold. Reach an expert fast. Comcast business. Built for business. Theres a lot of places you never want to see 7. 95. [ beep ] but youll be glad to see it here. Fidelity where smarter investors will always be. If only the signs were as obvious when you trade. Fidelitys active trader pro can help you find smarter entry and exit points and can help protect your potential profits. Fidelity where smarter investors will always be. Welcome back. As first day of spring approaches we head to ogden utah, they have been springing back thanks to patient cooperative and careful reinvestment by the government and business and investors. Mary thompsons joins us from Union Station. What do you find, mary . Reporter im standing outside standing outside of Union Station because it was railroads that used to be the engine that drove ogdens economy, an economy that had fallen into disrepair until 16 years ago when the city embarked upon renaissance plan aimed at bringing businesses back to ogden and ogden back from the brink. In the shadow. Wasatch mountains, one of ogden, utahs latest project is under construction. This is what we call a lifestyle park. Reporter known as the Business Exchange the home of the citys former stockyard will soon house some of its former 30 Outdoor Recreation firms, firms like the makers of bike parts and products. The park is part of a decades long plan to revive ogden which relies and for a set times, schools and other taxing entries in the projects district give up taxes derived from any increases in Property Values and the money used for improvements like widening roads and removing blight all in the aim of making the location better for business. The School District benefits and the county benefits and we benefit. Reporter among the benefits, an Unemployment Rate of just over 4 and a 20 increase in the citys Median Income since 2000. Now its also earned ogden accolades including being named one of forbes best place for businesses and careers. Companies agree they are among the businesses that have operations here in ogden. Way cheaper than california. Mar he, did you get to try a fatfire bike . Reporter i wanted to because the trails running alongside the wasatch mountains are beautiful. The setting is stunning. Weve got a reporter on the ground. Whats the word on the president ial primary there . Mitt romney waded into the battle and said he was supporting trutz. What do you hear . Reporter you know, people are pretty quiet about their political views, at least the people ive been speaking to. I think a lot of people are a little bit surprised at what were seeing at this time. Thats what ive heard from some of the people that ive spoken to. Yeah. Reporter but i didnt get the sense one way or another which way they are leaning but we do know it tends to lean republican, utah does. I was going to say probably its staying mum is good for business. Mary thompson out in ogden. Try a fat tire bike. Never mind a computer or phone. What gadget the fbi is saying is increasingly vulnerable to hacking when we come back. Arti. Arti. In less than a second. speaking japanese i can understand euphemisms, idiosyncrasy and complex metaphors. I know every detail of every public Quarterly Report in the last 20 years. And im just getting warmed up. Hello. My name is watson. Together we can outthink the limits of whats possible. Welcome to the cognitive era. Steve, other than making im here atme move stuff,rade trader offices. What are you working on . Let me show you. Okay. Our thinkorswim Trading Platform aggregates all the options data you need in one place and lets you visualize that information for any options series. Okay, cool. Hang on a second. You can even see the anticipated range of a stock expecting earnings. Impressive. Whats up, tim. Td ameritrade. Welcome back. Well, that smart car may seem convenient, but the fbi and nits are warning carmakers and vehicles are at increased risk of hacking. Hackers would be able to gain control of functions like starting the engine, unlocking the doors, hitting the brakes. Remember, in 2014 wired magazine demonstrated a car hack using a jeep cherokee. The point being, making the point earlier, the more we hand over the technology the more vulnerable that makes us. Its pretty amazing, and its going to be so fun and cool for some 16yearolds a few years in the future to really do this well. Its not like hacking a coffeemaker or a pacemaker which people have tried to do as well, but this is going to be a serious issue. Why do you need to break into a car if you can put a few codes into your computer . Thats why we need to take the Mike Santolli approach, staying away from social feedia. From facebook. And the dumb car. The smart part of it is the problem. I didnt even know this is unauthorized surveillance. My 8yearold took this of me. I was driving my 12yearold volvo. What i like about this, might be the last model of car that came standard, when i clicked over 125,000 miles with a cassette player. Yes, it has a cd player and regular stereo and has a cassette player. Convinced theres no electronics in that volvo. I think its an operating system beyond the reach of todays hackers. Can we see a premium for dumb cars versus smart ones . See it being the turntable, right, not in the main, but there will be a certain connoisseurs approach to traveling . By the way, opening up cuba. They make aftermarket parts for all these 1950s american car and people are excited because it increases the capacity for a lot of old cars. Back to the future but just the old part. Gains five straight weeks in the market which we havent seen since the market bottoms. Weve got key housing numbers on tap. New and existing home sales and the housing index from jan and reports from nike, cabee toys and restoration hardware. Perhaps some positive attention from the sneaker that can tie itself. Well see if anybody hacks that, mike. Really become a tell on the Global Consumer and, of course, its really been a big howard. The s p saying its the oneyear anniversary when apple replaced at t in the Dow Jones Industrial average. The swap has cost the dow 187 points because apple down, at t up. I sit on that committee. Come on, dennis. I dont blame you whatsoever for doing it. But i think one thing to keep in mind, of course, is the dollar and nike very sensitive to where the dollar trades. Its been coming down so that helps big sort of exporting Companies Like nike a lot. Probably the headline that should be the headline. Talking about the market. Were talking about oil and the flip side to a lot of these trades has been the dollar. 95 is the dollar index right now. Its fallen by several Percentage Points from its recent highs. Thats a question for a lot of people. The main driver, kind of ties all different trades together, commodities and fixed interest and everything. When the japanese yen rallies thats not good for risky assets or good for stocks that. Relationship has come apart a little bit recently. The thing next week that im paying most attention to is oil. Energy overall, pretty strong rally this week. Can that be sustained . Might we see actual cuts or evidence of cuts . Thats going to weigh largely on the markets, too. The housing data which we mentioned we have a lot on tap, i cant remember the last time that was really moving the market one way or the other. The housing sector has been left as kind of the narrative of the past. Oil becoming the key to the future. The supply demand figures for there, the rig counts being down as much as they are, and questions of how quickly they will come back online. A lot of people dont have enough money to bring that supply back online. A wave of 3wru79ies will move through the emp sector that will happen even more and whether its iran, russia, saudi arabia, the opec guys, how they are going to play this game. Saudi arabia is setting up for a long haul and this right now, oil is moving higher. Yeah. Mike . I totally agreed, and i think that because stocks yes, today deed a little bit, if youre discussing the bold case in stocks after a 12 move, have you to be comfortable with the oil chart which is up basically 35 , 40 in a month. Like a shadow. Still cant shake it one way or the other. Guys, thanks so much for joining me. Have a good weekend. That does it for us on closing bell. Fast money begins right now. Fast money does start right now. Live from the Nasdaq Market site overlooking new york citys times square im melissa lee. Traders are tim seymour, steve grasso, brian kelly and guy adami. Tonight on fast apple is quietly doing something very interesting ahead of its major announcement monday. Well tell you what it is and how you can profit from the big event. Plus, valeant ceo has a simple message for his employees. We aint broke. Did he just break one of the oldest rules in the book . Well explain and how would you like to buy shares of mcdonalds for less than a cost of a happy meal . How to do that, first markets and historic week for stocks, both the dow and s p closing out in the green for 2016. On track for the