They make of this activity. Earnings looked pretty good this morning. Kind of mixed. Retail sales figures for december okay. Decent. Not horrible, but okay. And we had a lot of fed speak as well today. Charles plaser saying it is clear that the fed is tapering and is going to do away with quantitative easing but theyre in no hurry to raise Interest Rates. And a couple big interviews coming up on the show. Wells fargo among the banks kicking off a flurry of financial earnings this week. That company beating estimates. Mortgage loans fell to levels not seen in five years. How much of a worry is that . Well ask tim sloan in just a bit. Look forward to that. And tesla has been a huge winner an reporting much better an expected Fourth Quarter sales numbers, but buckle up. Weve got ceo elon musk coming along to tell us about those record numbers as well as the automakers do you use the word . Recall . Upgrade. Its never easy with elon musk. According to the federal trade commission, its a recall. But he says they need to recall that word. Its not a recall. But well talk about that coming up. Yes, we will. Well talk about that stock today up big. If you google the term big brother, meanwhile, the result might well be google. Well look at the companys latest acquisition of a startup called nest and how it could mean google will know when youre home, what youre doing at home. How much could google profit or use that information . Stay with us. And what are they up to right now . What arent they seems to be the question. Its amazing. Lets show you whats happening today. Rally day from the getgo. Were near the highs of the session right now with the dow up 91 points at 16,349. The nasdaq doing very well, up 1. 5 . Gaining backplus what it lost yesterday. And the s p up almost a percent now, 17 points at 1836. Joining us in our the Closing Bell Exchange is ra beck that patterson, david kudlow from mainstay capital management, rob morgan from fulcrum securities, and chris retzler. Rebecca, lets start with you. When the bell rang on december 31 and we moved into 2014, it just felt like something changed, didnt it to you as well . No, its been a very frustrating start to the year, especially for equities, and i think in periods like this today certainly feels better. Periods like this, its always going to take a step back and say has something fundamentally changed . Has my thesis changed or is this just consolidation . At the end of the day i think it was just consolidation. Im still very optimistic about equities this year. The data is still moving in the right direction. Look at today. Small Business Sentiment better. Retail sales okay. Data out of europe and japan both better than expected. So the fundamentals are telling us that this was just a lull, nothing is broken. Rob morgan, alcoa missed and shares were hit on that report, but what about jpmorgan and wells here . Kind of a decent quarter. Does that stand out to you in terms of pointing a market direction . I would agree with rebecca. We just came off one of the best years in basically two decades in stocks. We had some profit taking or consolidation. We didnt really have any catalyst to drive stocks upward until earnings season which just started. As you pointed out, alcoa missed, but its just the First Company that reports. It doesnt represent the whole, you know but, yeah, wells fargo and jpmorgan today. You get a couple good earnings reports and we get the dow up the way were seeing it. David, you have got an interesting perspective. Last year modest economy, but a stellar stock market. You think its going to be the other way around this year, right . Yeah. We think last year we had a great stock market and a modest economy represent at this of the anemic growth weve had in this recovery for the most part. We think this coming year, 2014, we get a great economy or a much better economy, growth expanding a lot of what weve seen over the previous four years of this recovery, and the stock market more modest returns, but still on the order of about 10 to 12 . 10 to 12 at this point, you know, probably sounds okay to folks. Chris, im curious, when you look at the people who are buying in for example to the bond space, the people who would find something below 3 attractive, overseas investors, pension funds. How important is that going to be here in terms of keeping yields low and what kind of boost does that provide to the stocks longer term . Well, we think that as rates go up, that theres going to be a rotation out of fixed income into equities. So were here at the Needham Growth Conference today and were seeing a host of companies that are generally optimistic about 2014. It doesnt mean we wont have a potential correction here in the next few weeks which would probably be very healthy for the longterm direction of this bull market that weve been in. Im going to steal notes from a guest you have coming up in the next hour. Weve gone 830 trading days without a 10 correction. Thats just astounding, rebecca, when you consider was that all fed fueled do you think . No, not at all. The fed is a big component of this and watching how the fed evolves under janet yellin will be important, but keep in mind weve had a tremendous amount of net stock buybacks over the last year. Weve had people focused more on stocks for dividends, and we have had at least a reduction, i wont say a resolution, but a reduction of global risks out there. I think for the u. S. In particular, we cannot underestimate how important fracking and horizontal drilling have been. If you look at the trade report we got out of the u. S. Last week, our oil imports are collapsing. Thats a direct positive to gdp and a really important support for the u. S. Consumer, and i think that could take this u. S. Economy above 3 this year potentially, and thats above expectations. And, rob, whats so interesting, too, is at the same time its not the best news to the energy sector. You guys are underweight. We see crude under pressure today. Where does it go from here . I would agree with rebecca the long term dynamics for energy look pretty good. Just in the short run we think as rates go up, the dollar is probably going to go up, and thats going to be not so good for the energy and material space and gold and oil probably in a year lower in price. Just to be clear, oil today is rallying, so were up about 0. 7 . Some of those names doing a little better. So why do you stay away from the space in the longer term . For a very long term investor, some of those dynamics that rebecca mentioned with fracking, you know, theres a theory that really this is going to lead to the whole manufacturing renaissance of america and i kind of subscribe to that theory, but that probably doesnt really happen until 10, 20 years down the road and investors are worried more on a quarter to quarter type how have you done for me lately . David, maybe im being impatient, but if youre expecting a better economy this year, shouldnt long rates be going up more than they are . The tenyear cant get above 3 right now, and there are plenty of people who feel it should be around 3. 5 given the economy at the moment. Yeah. We think weve still got further to go before rates reach what we consider normalized levels at 3. 5 to 4 on the tenyear. And we saw a pullback of about 20 basis points here just recently thats the point. Whats the message of the market if its pulling back like that . If were seeing a reluctance to push rates above that 3 level . Look where weve come from. At the beginning of may, down around 1. 6 on the tenyear. Rates went up quite a bit, up to 3 . We had taper scare in september, came back to 2. 5 . Were going to have kind of two steps forward, a step back, but the longterm direction over the next year or two rates are going higher. Were going to see rates break above 3 , stay above, and head towards four on the tenyear over the next year or two. All right. Folks, got to go at this point. Thank you very much for your thoughts today. Appreciate it very much. Thanks, bill, kelly. Thanks. Stocks recouping some of yesterdays big losses. Whats driving the come back . Lets start out with the electric car business snp tesla was 20 higher than the estimate it gave at the end of the Third Quarter. Elon musk will be live on the closing bell. Regeneron reporting u. S. Sales of its idrug will hit 1. 4 billion for the year. Its ceo is saying theres plenty of room to grow. Hes going to be on mad money with jim cramer at 6 00 p. M. And 11 00 p. M. Eastern. And a strong day for Intuitive Surgical as well. The company is delivering Fourth Quarter revenue guidance above wall street estimates. On the down side we have boeing. This after battery problems resurfaced on the 787 dreamliner. It released some gas from the battery. It was discovered during a scheduled maintenance exam hours before the Japan Airlines flight was to take off, and a tough day for game stop. This after the video Game Retailer forecast Fourth Quarter profits below street expectations and we end with Intercept Pharmaceuticals dropping another 32 after gaining more than 500 last week. Bill, back over to you. What a round turn that has been. Incredible. Straight up, straight down. Thanks, dom. Elsewhere, theres an Important Development in that big nfl concussion settlement that was reached recently. A judge now says not so fast. Mary thompson has our details. Judge anita brody declining to give preliminary approval for the settlement fearing the price tag may not be enough to compensate affected player. Brody wrote, i am primarily concerned not all retired nfl Football Players who ultimately received a qualifying diagnosis or their related claim ents will be paid. Under the terms of the sett settleme settlement, former players diagnosed with ailments stemming from concussions would receive Cash Payments ranging from 1. 5 million to 5 million. Brody laid out a hypothetical situation where the 760 million would fall far short of covering potential claims that could occur over the 65 year life of the fund. Brody wants to see more documentation proving the 760 million is enough. In statements a lawyer for the retired players said hes confident the settlement will be approved. The nfl called the settlement fair and said they will work to supply the Additional Information brody has requested. Very unusual. Both sides feel its enough but the judge says not so fast. Thanks, mary. Well, its a classic turnaround tuesday. Yesterday at this time we were talking about a selloff we hadnt seen in three months, but now were up 95 points on the dow and the nasdaq has gained back what it lost yesterday. What are individual investors doing after the choppy start . Wisdom is waying in. Theyve had a big year. New evidence that Rising Interest Rates and new regulations may be hurting the Mortgage Market. When we come back, well find out how that affects the nations largest Mortgage Originator when we talk to that man, wells fargo chief Financial Officer tim sloan joining us once again. And google already knows pretty much everything you do online with your android smartphones, and now they might know what youre going when youre at home and when youre not technically online, like when youre sleeping how hot you keep your house. Is google becoming a big brother. We want to know what you think. Tweets on this subject will be revealed later on the closing bell. Youre watching cnbc, first in business worldwide. We want to know what you think. We want to know what you think. But well do our best to help you connect to what is. [ male announcer ] what kind of energy is so abundant, it can help provide the power for all this . Natural gas. More than ever before, americas electricity is generated by it. Exxonmobil uses advanced visualization and Drilling Technologies to produce natural gas. Powering our lives. While reducing emissions by up to 60 . Energy lives here. Amazon started in a garage. Hewlett packard, and disney both started in garages. Mattel started in a garage. The ramones started in a garage. My point . You never know what kind of greatness can come out of an american garage. Introducing the 2014 motor trend car of the year. The all new cadillac cts. Aint garages great . Right now in trenton, new jersey, governor Chris Christie is about to deliver his annual state of the state address. A lot of governors do this about this time of year. Of course, a lot of focus on him right now because of what has become known as bridgegate with all of the revelations last week about his senior staff taking revenge against the mayor of ft. Lee, new jersey, back in september for not endorsing governor christie for reelection and closing up lanes on the George Washington bridge, the most heavily trafficked bridge in the world, and that, of course, caused the mother of all traffic jams in ft. Lee, new jersey. Governor christie went on to do a mea culpa News Conference last week. He fired one his senior staff members, and now were waiting to see what he has to say about all of this. Well get a sense of that though from his speech. I guess he is going to acknowledge it, that it was a blow that his administration took. There will be a lot of people watching, of course, to see how he continues to handle the limelight and whether, again, this issue becomes something important enough to start influencing and shaping the race for president the next time around. He is certainly a gregarious kind of guy. Well see what he has to say in a little bit. Wells fargo shares have been under pressure just slightly. Now it is actually trading a little higher, but not commensurate with the rally were seeing today. A little better than expected increase in Fourth Quarter profits to the tune of 11th, but investors are concerned about that 60 yearoveryear decline in the banks mortgage lending and a new forecast suggests that may not get better anytime soon, right, diana olick . Thats right, bill. It will not. Not with rising rates and more mortgage regulation. The Mortgage Bankers association today lowered its 2014 forecast for originations by 57 billion to 1. 12 trm 1. 12 trillion for t. Its not just refis. They lower their purchase loans to 677 billion. This after they saw a 60 drop in originations. Jpmorgan not much better down 54 . Refinance volume has been hit the hardest, but mortgage purchase applications have also been way down, down 16 last week from the same time a year ago according to the mba. The mba has been warning against the new lending rules that went in effect last week from the Consumer Financial protection bureau. We get Weekly Mortgage applications numbers out tomorrow morning. It will be very interesting to see how the changes have started to play out. More Online Realty check. Cnbc. Com. Thank you so much. And in a first on cnbc, we are joined by wells fargo cfo tim sloan. He is also a member of the cnbc global cfo council. Its great to have you here. And we look forward to hearing a little bit more about the quarter. Lets start with this issue that diana raised. What about the Mortgage Business and the decline in revenues you have seen from 2012 . Kelly, bill, its great to be here. Good to see you, tim. We have seen a decline in the Mortgage Business. Its something that we candidly have been expecting for a while because of the fact that a year ago the disproportionate share of our mortgage originations were refinance. The refinance bubble has waned. I think the important thing if you look at our results for the quarter is that notwithstanding a 38 decline in our mortgage originations, we were able to report 10 yearoveryear Earnings Growth, our 16th consecutive quarter of Earnings Growth and our 11 consecutive quarter of record earnings. Its not dependent on any one business in particular. To some extent, you have to read the mind of a person who is going to take out a mortgage or wants to buy a house, and its clear were coming off these record lows weve been at for a few years now, and people are not going to want to buy a house, certainly theyre not going to refinance if theyve got those record lows already on the book. But at what point do you think theyll become comfortable enough to want to come back into this market in a little bigger way . Well, theyre coming back every day. We originated 50 billion worth of mortgages in the Fourth Quarter, which was terrific volume from our perspective. Its just down a bit from the Third Quarter and clearly down from the refinanced driven volume we saw in the second half of 2012 and the first half of 2013. So is this the new normal we should get used to . I think its more likely to be closer to the new normal than what we saw a year ago, but, remember, the housing affordability, what it costs for a Median Income in terms of a purchase for a house, is still very, very attractive and at historic lows. We continue to believe well see a very attractive business in our Mortgage Business, but, again, the important thing is thats just one of the many things we do at wells fargo, and we saw great growth in many of our other businesses, whether it was retail brokerage or credit card or auto or Investment Banking in this quarter. And certainly the growth in loans to commercial and industrial organizations catching peoples attention and i wonder what you can tell us about who exactly these borrowers are, whats driving the increase, and how much of an increase you expect in 2014. Well, i dont know the answer in terms of exactly what the increase will be in 2014, but we do believ