160 points at the low of the session, and that was within the last hour or so. the s&p down 16 and the nasdaq down 46 there. >> a lot of people watching the ten-year treasury yield as well, looking to that as they have for weeks now. >> right. >> kind of a broader reflected gauge of where we stand in the economy, where is this all headed and to what extent, if you look at the performance of these markets since the federal reserve meeting over the last eight sessions or so, that's really where you've seen the rotation from growth into value. how much does it have to do with the tapering and tightening if you want to call it that. >> a day that when they sell the stocks they buy the bonds because the yields on the long end of the curve have been come down today. let talk about it and get to our "closing bell" exchange. quincy crosby and anthony chan from chase, michael guyette from pension partners and winner, by the way, of the 2014 dell aware and samir samano and jim lacamp from ubs and gordon charlotte from rosenblatt securities gives us a traders eeye view. gordon, what's going on and let's take it back a few days beyond that? you know, this selloff is accelerating, if anything else. why? >> aksccelerated through friday and into the morning, bill, but, you know, almost get a sense that maybe we're starting to stabilize a little bit certainly off of the dead lows from a couple hours ago. we're sort of in no-man's-land until we get to earnings season, and i think what you see generally is a little bit of a risk-off situation, and you were talking about that, kelly talking about it before with the ten-year. the rubber meets the road when earnings comes out and we'll see what this market has. >> michael, how are you positioning? rotating into value along with it seems the rest of the market? >> we actually rotate it had to treasuries. bill, you mentioned defensive plays. mother of all defensive sectors is utilities, and in the intermarket rotation to beta rotation, my partner and i showed since 1926 when utilities lead the market, when they outperform they tend to precede periods of high volatility and corrections. what's the best performing sector this year? utilities. what's happening to bonds? they are rallying. yields are falling despite fed tapering. what's happened to emerging markets, the honey badger moved overseas. this is a risk dark off environment if you're looking at everything except emerging markets. looking at emerging markets, looks like they are starting to price out that crisis that never existed. >> jim lacamp, what do you see happening here? we've blown through support levels here the last few trading sessions. >> we have. >> go ahead. >> we have, bill, and that's what makes -- that's what makes this selloff more harsh than what we've seen over the last several quarters, and as you mentioned it's the harshest selloff since 2011 but look at what's happened. you've seen consumer discretionary which was leading the market. it's down about 14% from its highs, you look at technology, down over 14% from its highs. you look at the biotech index. so it's these growthy areas, mid-caps, small caps and high growth names that have been hit far harder than the averages have, but they are not finding support. we've found support on these names at the 50-day moving average in february and all throughout last year. now we're seeing more selling. that suggests to me that we've got a bigger selloff afoot. let's not forget at every mid-term election year we've had corrections going all the way back through the last century, on average about 20%, so it shouldn't surprise anybody that the market is hesitating here. >> quincy, are you guys raising cash levels? what are you doing here? >> well, we've been telling clients all along that we were due for an important correction. 5%, 6%, 7% is not an important correction, it's norm a. it's the kind of pruning that you have to do to get to and have the levels that you have commensurate with valuations. so we have been putting clients in very good quality stocks. ones that, by the way, have been cheaper than the high momentum stocks, and we've had a diversified portfolio accordingly, and it's selling off, but we're telling clients to get their lists ready because there will be more of an opportunity. >> quincy, what are some of the names? >> we like some of the bank stocks being hit right now, but we do think that the economic data get better, that the yield curve sweetens a bit and the banks and insurance companies will get a nice bear. >> you're calling for a further correction, even though you think the fundamentals are improving. >> yes, absolutely. i'll tell you something. credit markets right now are telling us that ultimately this will be a buy on the dip, but we're not yet there. >> anthony chan, will those fundamentals get better? is the economy improving? >> well, guess what, bill, not only will they get better, they are already getting better. today we got interesting data showing delinquencies are down 30% on a year over year basis. as that magical event occurs, namely spring, we're starting to see the economic data roaring back. we saw car sales. we are starting to see that this week when we get the consumer sentiment numbers on friday, i think it will be important because it will tell us what retail sales will do for the month of march. i think consumer spending will end with a bang, rather than a whimper. i expect retail sales to be double the growth pace we saw last month. >> let me push back a little bit. housing has been spotty, and the job growth, while good, is not great. we're not really seeing a pickup in that area yet. those are two very important parts of the economy. >> well, guess what, bill, looking at that employment report, it was a lot better than what we've seen over the last couple of months. even the number of discouraged workers, seen that number at multi-year lows. seen the number -- >> they weren't good numbers though. they were not good numbers, and we're not seeing any aks accelerati acceleration, any escape velocity. we've been hearing calls for this economy to take off. >> one at a time. >> look at the yield curve. the yield curve is saying -- flattening out, saying that the economic data is very soft here, and those jobs numbers weren't good. they were better than some expected in some components of it, but they -- there wasn't a good number there. >> it was improving from the numbers that we've seen over the last couple of months. remember, we came from a financial crisis. when you come from a financial crisis, you don't see miracles right away. >> samir, we haven't forgeten you. have so jump in once in a while. where do you stand on all of this? >> i would take a different tact saying it's way too early to say it's a risk dark off move. fixed income marks, spreads haven't blown out or anything along those lines. two, one of the guests mentioned emerging markets which are holding very well. this really isn't a risk-off move. there's a little bit of rotation. you're seeing some of the high-flying names come back, and that's really all it is, and it's an opportunity to buy stocks. >> all the same, samir, it's interesting to look at the financials today, american express down 2%. why do you think that, you know, if we had a day where they were outperforming the market, i could understand your point, but why do you think they are lagging here today? >> well, i think that they are lagging because you have to sell something. >> samir first. hang on. >> sure. it's just -- it's normal profit-taking. i wouldn't read too much into this. i go back if you look at the broad indices they are holding up pretty well and above their support levels. it's only when you look at the industry groups, internet-related stocks or biotech that you've gone through support. everything is pretty much intact, trends there and a great chance to sell forecastsed income at low yields when you get to rotating the stocks. what could be better. >> go ahead, quincey. >> inflation would be better. >> go ahead. >> well, what i was going to say is if you take a look at loan growth we started to see a nice pickup, not great, not stellar but a pickup in loan growth for commercial real estate. we started to see it in commercial and industrial loans. that is always a very good sign that the economy is gaining some demand, and this is all about demand. >> and quincey, when you see cni roll over, guess what happens afterwards. >> the economy is getting better. >> hang on, one at a time. >> commies at the stock market. >> exactly. >> when you see cci loans accelerating, that usually means employment growth will pick up. one last point with regard to the employment report. when you look at the payroll income proxy, how many more workers than wages, it was running at 3.5% in the fourth quarter. now we are seeing that number run is at 4%. >> jim lacamp. >> not run together races, but 4% seems to me -- >> okay. the economy is getting better, we're five years into a correction, five years into a correction. we've printed now $3.7 trillion since 2007, and so we have some traction, some improving economy. it's not enough. we need to do a lot better and stocks have had a five-year bull market in the meantime, yes, we're due a correction and i don't see how you can possibly say it's not a risk-off correction. it is a risk-off correction because every group has been hammered. >> let me go back to something you said off the top, michael. samir said don't make too much of this, not a risk dark off event but you said that's what it is. >> when toltal return treasury indices outperform on the long end, the next month ends up being quite volatile for stocks. there's talk about credit spreads and how they are still tight, not indicative of a risk-off. may 2012, credit spreads blew out towards the latter part of the month. stocks falling for several weeks. could see a period like this. a notion that you have to have ved it spreads blow out first and then a correction, quite the opposite. credit spreads can begin to widen which is really risk darkoff. >> and that would suggest we're more towards the beginning than the end. >> exactly. >> gordon, before you go, thoughts on the last hour of trade. lately real on the open in the morning and then it sells off the rest of the day. today it's sort of the opposite and we're coming back a little bit. >> that's the way it's acting to me. want to point out one more thing. the panel made a lot of great points. one of the things we've noticed is the calendar is full, had a good run last week with a bunch of new names that were oversubscribed and looking for more action out here this week. when you look at today, you start to see them stabilize here. i wouldn't be surprised if they held them at this level, maybe reverse them a little bit more right into the bell. you get a sense we came in friday with that sense that we're going to continue to sell into monday. they have done that. it's over. we may be finding a level of support here and whether it's risk on or risk off, still feels like we may have found a level here right now. >> all right. we'll see. thank you all. appreciate your thoughts on today's market. >> lively. >> just below the 1850 level, important psychologically perhaps if that can hold as we head into the close. >> exactly. >> 50 minutes to go. the dow at this moment off 123 point, .75 of 1%. and the nasdaq off more than 1%. >> remember the dotcom bust nearly 15 years ago? two wall street heavyweights tell us they think this is the start of something similar to that or if it's just a healthy correction that you need to be buying. plus, we'll speak with two stock womeners to find out what's on their shopping list these days. >> and later a tale of two housing markets. vacation homes are selling like hot cakes once again and first-time home buyers are having a tougher time getting in. this has a lot to do with who is in the stock market and who isn't. more on that when we come back. tall the building is, or how ornate the halls are. it doesn't matter if there are granite statues, or big mahogany desks. when working with an investment firm, what's really important is whether the people behind the desks actually stand behind what they say. introducing the schwab accountability guarantee. if you're not happy with one of our participating investment advisory services, we'll refund your program fee from the previous quarter. it's no guarantee against loss and other fees and expenses may still apply. chuck vo: standing by your word, that's what matters the most. afghanistan, in 2009. orbiting the moon in 1971. [ male announcer ] once it's earned, usaa auto insurance is often handed down from generation to generation. because it offers a superior level of protection. and because usaa's commitment to serve current and former military members and their families is without equal. begin your legacy. get an auto insurance quote. usaa. we know what it means to serve. ♪ ...work with equity experts... who work with regional experts... that's when expertise happens. mfs. because there is no expertise without collaboration. welcome back. another tough session for markets today. not necessarily shaking off any anxiety over the weekend. instead the dow is off more than 100 points. off the session lows. >> what did you say, it was down 72 at one point? >> cut it in half right now. sciola modi, give us a roundup of the movers. >> seeing selling across the board here. let's begin with pfizer falling despite reporting some positive trial data for its breast cancer drug. investors, we're hoping for better results from the phase two study. now a tough debut for land's end, the stock taking a hit on its first day of trade after being spun off by sears, not very much better. world wrestling entertainment plummeted despite saying it's on track to getting 1 million subscribers for its network by the end of the year, baron saying that might not be enough to counteract the drop in pay-per-view event revenue. intel shares are moving higher after pacific crest upgraded the chip-maker to outperform from sector perform noted improving pc demand and will end on procter & gamble gaining ground after increasing its quarterly dividend to 63 cents a share. bill and kelly. >> thanks very much, seem avrnlgt the bright side to a couple of sessions like this that some stocks will be unfairly punished by the broader falling market. >> call them sort of the babies in the bath water stock. the key is knowing how to spot them, of course. our next two guests say they have feel like they have identified some names that fit that category. joining us, david sieberg and craig hodges, co-portfolio manager of the hodges small-cap fund. david, does that suggest that there's an irrational selloff going on right now if they are selling everything. >> selling things broad-based. it's an orderly selloff but there's a risk-off mentality going on and it seems to be more broad-based. when you look at different sectors you have to break it down in an intelligent way. look at tech. tech, is you know, a general risk-off, sore institutional holders sell these names and go into more value tech names. biotech, large-cap biotech extremely difficult. not seeing the core holders take money off the table. maybe trimming here and there, but we're not seeing them bolt out of those names. not seeing broad-based selling. i think it's a very different way to look at the two sectors. my two picks, gilad and biogen. should be bought here and bought aggressively. >> gilad, the one that started this whole thing when henry waxman and congress questioned their pricing of a drug, right? >> yeah, absolutely. the stock's come back. stock came in from what, roughly, i don't know, sub 71 from 85. stock is going higher. got a $95 target on this stock. >> okay. >> and i'll tell you, this drug that they have is a very, very -- it eradcates hep-c, pricing shouldn't be an issue. >> in the meantime -- sorry, go ahead. >> i said pricing shouldn't be an icing, kelly. >> yeah. craig, what's interesting to me about one of your picks is almost important. it has the ticker hero. i'm assuming that's just a coincidence. >> hercules offshore. what we see is we need a correction. we need, you know, it's been i guess two and a half years since we've had a 10% correction. i thought that was a long time, but i noticed there was no 10% corrections between '90 and '97, and there wasn't one between '03 and early '08, so these things can go on forever, but it appears the market is running out of buyers here, so a good correction i think would bring in a lot more buyers. there's parts of the market are very expensive, but there's -- there's a big majority of the market that's not. >> talk to us about a couple of the places that you see value. >> sure, sure you. >> mentioned herculez offshore. stocks pretty close to its 52-week low. they are a jackup rig company in the gulf, mostly in the gulf. i mean, the deep water rates are soft, but the jack-up market is pretty good. the executives there have been insider buying. stocks around 4.5. they see the outlook for gulf the strongest they have seen in over30 years. >> down 36% in the past year. >> yeah. >> so i guess if you liked it before, you love it now, is that the idea? >> it should earn 60 cents this year, so the stock is extremely cheap from that standpoint. we also think you ought to be -- you know, the strongest stocks that were in the market before this selloff, you know, kind of focus on those. >> okay. >> stay away from the high multiple stocks. we've been a proponent of american airlines before that u.s. airlines for a couple of years. we think we could see $7 earnings out a couple years, so the stock at 35 is about five times earnings. we think that that's a good growth vehicle. >> david, just to zoom back out for a movement you mentioned a couple weeks ago the fact that this market wasn't very hedged. do you think it's something to do with the aggressive selling that we've seen, especially when you look at the hedge fund returns for the first quarter. don't look that great. tech funds really, really hit hard in march. what does that tell us? what is the message there? >> well, i mean, kelly, the tech funds, they were hit hard. a lot of guys, they were short the value names to buy the fund -- to fund the growth newspapers and that trend reversed on them so they got crushed and got it from both sides. look, i think that -- no, i don't think people are really hedged right now. a lot of the selling that we've seen has been, you know, let's say a manager is taking a percentage of their weighting in certain indexes down a little bit specifically in biotech. etfs have been a big culprit of this, and i don't hear a lot of people talking about this, but etfs have been a major culprit. >> how so? >> because you'll have people that i call renter, right, that own the ibbs or own, let's say, the large-cap biotech space or the biotech index. they are getting exposure, right? getting exposure to this space but they are not core holders of the name, like the institutional holders that we have. the institutional holders aren't blowing out of it. it's the renters. it's the people who have exposure through etfs who have taken risk off a little bit here or taken profits maybe in the sector so it's a very different way to look at it, and that's why i'm telling you, i think biotech in general, the two names i cited, i think are very good long-term bets. >> okay. one of them gilad is higher today on a day like toyed. >> relatively outperforming. >> when we set a selloff like this, your shopping list grows. that's how that works. thanks for your thoughts today. >> thanks, guys. >> we are coming back. the dow down 160 points, now a decline of 108 and the most dramatic comeback has been for the nasdaq which was down 72 points, as you pointed out earlier today. >> two pros will give us the takes, how long will it last and if they are buying the dips. >> talk about a hedge being clipped, with a guilty plea, steven cohen's s.e.c. capital is adopting a new name. kate kelly with the details of the teflon heggie coming up. he. huh, fifteen minutes he. could save you fifteen percent or more on car insurance. everybody knows that. well, did you know bad news doesn't always travel fast? (clears throat) hi mister tompkins. todd? you're fired. well, gotta run. geico. fifteen minutes could save you fifteen percent or more. . welcome back. 35 minutes to go before the close. the dow is off 106. the s&p by about 13. remember, about 1848 is the dividing line between the black and red for the year, so watch that carefully while the nasdaq has cut its losses and is only off about 32. only tells you a lot about this market, bill. >> it's the end of an era of sorts in the hedge fund industry with a guilty plea to securities fraud charges now behind it. steven a. cohen's hedge fund s.a.c. capital is doing business under a new name with a new business model. >> kate kelly has the details for us now. kate? >> thanks so much, kelly. s.a.c. is now point 27 and only managing the money belonging to steve cohen, his family members and former employees. the firm is still managing about $9 billion and today's shift comes after a criminal insider trading settlement that forced s.a.c. to play a total of $1.8 billion and return its public investment money. that pact is expected to be formally approved in time for the courtroom sentencing this thursday. so far point 72 is off to a good start with performance through march of close to 10%. still more hurdles to clear. cohen continues to face failure to supervise charges by the s.a.c. which i'm told he would like to settle and the last year has been tough on the fund's portfolio managers, some who have been jumping ship in spite of sweeter compensation packages. point 72 president this morning acknowledged the turmoil. at its best, he wrote, s.a.c. was looked upon as the industry's leading long short hedge fund, the place where everyone wanted to work and be. our goal, certainly my goal, he writes, is to see us reach those height at point 72 but in a manner no one can claim is anything other than a result of your hard work, integrity and smarts. makes sense, kelly and bill, after all that's happened to strike that tone. >> elementary question first, when i heard this name, what's point 72 for those who doesn't know? >> stamford, connecticut flag ship office is at 72 cummings point road so point 72 is a twistup of that location, but also remind me a little bit of point state which is the hedge fund that sort of was created in the wake of stanley druckenmiller's retirement. he now has a family office. >> what every client would want to play. >> it's not the expense structure. >> one of the jokes in the hedge fund business is how hard it is to name a new fund, all the domain fund is taken, everybody uses their initials or go for something from classical mythology. >> how about steve cohen's other fund? >> s.cacof. >> 2.0. >> 30 minutes to go until the close. told you where the index stands. off 112 on the dow. >> nasdaq having a worse day than the dow and s&p on a percentage basis. we'll show you this heat map here of the nasdaq 100, all 100 components of the nasdaq 100 but all that means is it's ice cold. we'll talk to two tech pros when relief may be in sight and if they are buying in this downturn. >> never mind the recent pullback. what if we told you, recent stats show the best way to get a vacation home is by being in the stock market. that's coming up later on on the "closing bell." 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(all) awesome! i love logistics. these days, everything is done on the internet. and tomorrow you'll do even more. that's what comcast business was built for. slow dsl from the phone company was built for stuff like this. switch to comcast business internet. then add voice and tv for just $34.90 more per month. and you'll be ready for tomorrow today. comcast business. built for business. markets have started to come back a little bit, especially the technology stocks which we'll talk about in a little bi. nasdaq down over 72 point, now a 32-point decline. s&p down 13 right now. the dow down 160 points, a decline of 112 right now. traders have been referring to as a risk-off trading day here. >> washington working to develop the next wave of startups. it's an effort being led by the president's new task force of 11 businessmen and women called the presidential ambassadors for global entrepreneurship. >> yeah. commerce secretary penny pritzker is leading the effort with that. pleased that she's with us, just finished their news conference and along with the secretary are two ambassadors in this, fashion designer tory by itch and zillow co-founder richard barton. good to see all of you. madam secretary, what's behoointd hind this initiative? give us the goal quickly. >> what's so exciting about this initiative it's a real effort for us to take american entrepreneurialism and take it not just around the united states but around the world, and our ambassadors have agreed to work with the administration and the federal government to help us really teach people about how to be an entrepreneur, share their ideas, share their histories and give their best advice to budding entrepreneurs all around the united states and the world. >> rich, you know this better than anybody. a lot of this entrepreneurship and innovation seems to happen organically, and every time in this country or others where there's an effort towards incubation, it never seems to work. what is the magic formula for success if we want to encourage more startups? >> entrepreneurship is a bottom's up endeavor, not a top down endeavor which is what i think the president's ambassador for global entrepreneurship is all b.not the government coming down saying this should be done, it's us, we, the entrepreneurs like tory and myself going around the world and carrying that message to all of those eager folks. i was lucky enough to be at the kuala lumpur at the global entrepreneurship summer last october. secretary pritzker asked me to do a keynote and i saw entrepreneurs trying to make a better life for themselves and their mothers and if we connection port this kind of spirit this, entrepreneurial spirit, we increase freedom around the world. that's exciting. >> tory, clearly you've been wildly successful. you are now a human brand name. which raises expectations would i think for any young entrepreneur thinking about not just getting into your business but any business. ourying -- are expectations too high? what do you do when somebody want to start their business? >> i think i'm a rare person who succeeded when i why. i started my company ten years ago, 37 at the time, so for me it was something i never imagined possible. if i could talk to some of the entrepreneurs and talk to them about my journey and what we have faced, thinking about expectations, being careful, but telling them that it's portion i think that that would be a great thing. >> and how important is it for you to be a publicly listed company? we've had people like the ceo of ever note come through and tell us they think it's a moral issue to be publicly listed so, you know, tell us -- you've clearly within through the startup phase of this business. what's next and what's the ultimate goal here? >> we have so much next, and an ipo is not part of the program any time soon. for us it's about keeping your head to the ground and building the business, and as we expand in different markets, asia, europe, we have so much ahead of us, we feel like we're just starting on many levels. >> rich, you're like a serial entrepreneur, not just about sillo and expedia and other areas of technology. so many people who i know have lost a job and graduated college and are thinking about trying to find a job. almost starting a business of their own as the fallback. it's well, i can't find a job. might as well start my own business. do we have that backwards in. >> isn't it great that we can do that here though? great that we can do that here in this country, that we have the soil of good government. we have this kind of rain of talent that's constantly providing nourishment and the sunshine of money as well, and this creates an environment where we can grow these companies so i think it's downit's fantastic. now we've got to do that elsewhere as well. >> richard, real quick before we go. be remiss not to ask you here, is the tech bubble bursting? are we witnessing round two of some sort of technology collapse here? >> i think if we're asking that question, we're probably not -- we're probably not in it. i detect a tremendous amount of excitement out of the entrepreneurs that i deal with every day. i think the -- the hope and possibility and dreams they have are huge. i actually just got back from a week in china with my partners at benchmark capital where we visited all the major internet companies in china, and i will tell you that incredible things on a scale that is mind-boggling to us here in the united states is happening there. i can't see this ending any time soon. >> all right. tory, rich, good to see you both and madam secretary, we wish you well with this new initiative. thanks for being with us today. >> thank you very much. >> really appreciate it. >> thank you. >> 23 minutes to go until the close here. so, index is making a little bit of a comeback, but now kind of signature at these levels. the dow is now off 113 points, the s&p 14 and nasdaq by 34 at this point. >> the nasdaq, clearly the index that's taking the brunt of the heels of friday's drubbing. a sea of red in the nasdaq 100 as you can see mostly red. >> owners of the jacob internet fund feeling a good deal of pain right now. later the head of the fund tells me if he's buying this downturn. don't miss it. that's all straight ahead. all , i just want to say, i combined home and auto with state farm, saved 760 bucks. love this guy. okay, does it bother anybody else that the mime is talking? 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(whispering) what? get our everyday price match guarantee plus a $100 rebate on 4 select tires from your tire experts. chevy certified service. anbe a name and not a number?tor scottrade. ron: i'm never alone with scottrade. i can always call or stop by my local office. they're nearby and ready to help. so when i have questions, i can talk to someone who knows exactly how i trade. because i don't trade like everybody. i trade like me. that's why i'm with scottrade. announcer: ranked highest in investor satisfaction with self-directed services by j.d. power and associates. welcome back, the nasdaq has been the worst performer today and friday. sheila has been keeping a close eye on what's happening over at the nasdaq for us and some pain for tech investors. what's happening? >> reporter: it's been quite a day at the nasdaq, bouncing off the session lows and clawing our way back as we head into the close. remember, we actually started out the day in the green, dipped down as much as 1% and now seeing a bounceback. about the two sectors we talked about over and over, the momentum stocks and biotech sector. take a look at two stocks that mimic the nasdaq action, as you can see, started out in the green, made the dip and bounced back as we head into the close. same thing with biotech. definitely seeing buying momentum as we head towards the closing bell. this is exacts actly the type of trading action that people are paying very, very close attention to. as we head to the close and even for tomorrow morning, if we can hold on to the bottoms and see some sort of confirmation at the bottom. traders will feel a lot less nervous. what got them going this morning is we couldn't hold on to the rally in the morning. a lot of people seeing if we can stay at these levels. having said that despite the bounceback, the anatomy of the bounceback, still not looking so great for the year. looking down more than 2%, take a look at the 14% high from march, down 6% from that level. a lot of names are def in italy in bear market territory and technically we did slice through the 50 and 100-day moving average. what's showing the nasdaq higher, what's in the green. microsoft, intel, cisco, all value tech names which shows you where the value of the trader s.traders encouraged by the little bounce we're seeing. the question now is can we hold? >> that would be a good question, sheila. thanks. let's talk more about the nasdaq and technology stocks may be headed. bring in larry haggerty and robert peck with internet management research. good to see you both. larry, what's your version of what's happening here? does this present a buying opportunity, or are you still standing back and letting this knife fall further? >> i think in consumer-facing tech which is the momentum stocks that you talk about, there's been a parallel unive e universe, and the parameters around the parallel universe are changing. none of these companies are particularly mystical. they eat by collecting sub fees, add fees and sometimes like amazon they sell stuff, and the question is how fast are they doing it? it's revenue growth. how fast is that being converted to ebitda and how much do you have to pay for it? if you look at amazon and netflix on a return on equity at market, you're buying these companies that's somewhere between 1% and 3% return. the numbers that they are generating historically in the most recent quarters and perfectively don't indicate paying that even if rates are low and heaven forbid if rates are up you could be in a lot of trouble. as mr. graham would say in the securities analysis there's no margin of safety for investors. >> right. >> i think the stocks could fall another 20%, 25% easily. >> and earnings were referring, larry talked ebitda, 20%, 25%, does that sound about right? the decline of some of the names, 100 points for some of the higher flyers. in the period of some cases 10, 15 sessions. what does that tell you? >> well, what's interesting, we've seen a dichotomy in our spies with the higher multiple names hit more recently. take like a yelp or pandora down over the last month. over the last month the more lower multiple names on ebay and aol, et cetera, have fared okay, down 5%, 10% so we're seeing the die could the any myoright now of investors getting out of higher multiple names and shifting to the lower multiple. >> has the move run its course? is it going to go much further, and to what extent should we be drawing comparisons to the experience of the nasdaq collapse in 2000? >> seeing clients now start to cherry pick and look for strong names, platforms on the internet with deep moates and a lot of growth potential in front of it and names like google, facebook, people dipping into here, linked-in, et cetera. names coming back like yelp or pandora. you're talking on average names trading 5 to 15 times sales give or talk, an average fall of ten times. looking back to the bubble days, there weren't even multiples so you couldn't even compare the two. different world. >> layer, you're clearly expecting a bigger selloff here from here, but are you starting to nibble, buying anything? >> only in a couple stocks, bill. most of the stocks, as rob says, are pretty fairly priced. i think the one that's going to rear its head upward first is going to be facebook because they figured out mobile advertising. mobile advertising is going to grow very rapidly and facebook converts a lot of incremental revenue in mobile advertising to operating cash flow so i'm looking at a pretty good quarter for facebook, and facebook may grow into its valuation. that's going to i think lead the pack up. amazon and netflix are more problematic because their markets are getting more competitive. >> right. >> people are not going to let netflix go from 44 million subs to 100 million without getting into the pie, and -- and production in the tv area is increasing. i can't count how many new serialized content shows are on cable. >> and that's what's so interesting. >> larry, jumping in, look, you have what's in this case happening, there's deflation. there's rampant deflation across the tech sector. would you touch any, for example, of the cloud computing names? >> i only look in the -- in the consumer end, kelly, and -- and that's where my expertise is, and -- and we know how fast these markets grow. we know their size. i can't really size the cloud industry. i'm not much help to you there. >> it does become commoditized as many of them do, that's for sure. >> good to see you both. thanks for joining us. >> thank you. >> yeah. heading towards the close, 13 minutes left in the trading session. starting to zip a little bit lower, the dow down 143 point right now and the nasdaq now down 40. >> now, that's a perfect segue to our twitter question. tweet us what you think is happening. we'll reveal your best tweets coming up later in the program. . aflac. ♪ aflac, aflac, aflac! ♪ [ both sigh ] ♪ ugh! ♪ you told me he was good, dude. yeah he stinks at golf. but he was great at getting my claim paid fast. how fast? mine got paid in 4 days. wow. that's awesome. is that legal? big fat no. [ male announcer ] find out how fast aflac can pay you at aflac.com. about ten minutes left in the trading session. the dow kind of holding its own. down 147 points at 16,265. it's the nasdaq once again today that has gotten hit the hardest, down 44 point right now at 4408. flowers in her hair. >> april showers bring may flowers. this is an opportunity to buy the markets? what makes you so sure? >> well, when you look at the valuations. market, they are really not stretched, and i really love that you're having a lot of guest on that are very bearish be a markets don't top out when you see so many bears, whether they are talking about the ipo market, excessive m & a activity and pockets that are expensive, certainly a hit in the biotech and internet stocks. only makes up about 8% of the market cap of a market. we still find value in the energy sector. it's one of the most oppressed sectors, industrials and technologies, other select technology. >> i will admit we're quick to point out when there's a selloff of this magnitude, oh, this must be the beginning of the correction. always quick to point that out, but we are, let not forget, in the mid of a five-year bull run here, and lately we haven't had a pretty good correction. i mean, this could be a big one to begin with here, couldn't it? >> it's big in terms of the stocks you see going down. some are down 20%. i don't think you're going to see a market go down 20%. we do a survey at bank of america and merrill lynch called the global fund management survey and clients are sitting on cash, 4.8%. you don't see markets go down even 10% when there's that much cash on the sidelines. >> isn't it the case that some of the herd is getting back in lately. >> i don't know if a lot of the herd is getting in. i think people are getting very nervous. with the pocket that i would really take a look at is emerging marks. that had gotten hammered. some of the markets are down near their '08 lows. big short positions and we're actually seeing contra moves in the emerging markets. >> is that where you're putting money to work? >> select countries tactically you can kind of nibble at some of the emerging markets. >> like? >> we take a look at mexico. >> okay. i would even take a look at brazil. turkey still has some political issues but certainly down to levels that look interesting. valuations are there and very depressed currencies. >> stick around. want to see how this market will close. we'll take a look at what's been a pretty ugly day for the bulls so far. >> after the bell you've got to be in it to win it, and we're talking about the spike in vacation home sales and what's behind it. people are selling high-flying stocks and buying a summer home. is that part of the reason why we're seeing a little bit of weakness here in the markets? >> everyone is in florida. we'll investigate. you're watching cnbc, first in business worldwide. >> snowbird investing. nowbird i. gunderman group. gunderman group is growing. getting in a groove. growth is gratifying. goal is to grow. gotta get greater growth. growth? growth. i just talked to ups. they've got a lot of great ideas. like smart pick ups. they'll only show up when you print a label and it's automatic. we save time and money. time? money? time and money. awesome. awesome! awesome! awesome! awesome! awesome! awesome! awesome! 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[ male announcer ] stick it to the market before you get stuck. get the most extensive charting wherever you are with the mobile trader app from td ameritrade. welcome back. about four minute left in the trading session. let me show you a little perspective. going back five days until last tuesday. dow sideways action until friday when this selloff began in earnest. this has been today's action, so in the last five trading sessions, the dow's down roughly 1.25%. the nasdaq, as we've already established, has been the harder hit. it was the more volatile, had the best gains of the upside and now it's the most to the downside. almost a 3% decline for the nasdaq in this five-day period. its selloff began sooner than they did for the dow, an here we are now at the 4080 level and biotech zeroing in on more on one sector that's been pretty hard hit lately. it was the highest flying group. going to be hardest hit. it's down 4% in this five-day period here, now although today it's up a little bit, even as the market is lower. maryann bartell, what about biotech? a risky group, not one you would put rent money in but one you would want to dip into. >> we're getting some pe multiple contraction, but technically we don't see anything really broken. yeah, i think you can go in and nibble at some of these stocks. everybody looking for a correction, but it's really hard for them to actually buy when things go down because the news is never good, but we do believe this is a buying opportunity. bring up a good point, not broken. fundamentally things have not changed really much about the market. people are in the mood to sell now compared to when they were in the mood to buy. >> i think they are pricing maybe little higher interest rates. the interness net stocks very high multiples, getting a multiple contraction. has the story changed? has the economy changed? we don't think so. >> defensive plays where people start to go in a mart. food stocks doing relatively well and utility stocks doing well. would you go there as well in. >> if you're looking for income, there are sources of income. we prefer the staples because they are dividend growers, but for long-term growth, not the sectors that we would really nibble at. think that industrials look very attractive. i mentioned the energy sector and select technology stocks. >> and the dividend growers fell out of favor. for a while they were the hottest stock. everybody looking towards that dividend play to get that income while you watched your stock grow and then they fell completely out of favor, so is that a contrary play for you right now? >> i can tell from going out and seeing merrill lynch client, everybody is looking for yield, whether it's ultra high yield or dividend grower. we see very high demand to bring equity. >> what about the place to get in and what about you guys? >> if you're willing to take on a little bit more risk, not a cheap part of the market, but what we find is when interest rates rise high-yielding bonds don't go down as much. we're recommending it for select clients. >> i find it interesting, two days talking about the selloff and we haven't mentioned the fed at all. are they to blame for the selloff as they continue to taper? >> i think the dot plot is when they put in their forecasts for '15 and '16 but it's not official. the market is focused on that, but i don't think the fed is really to blame for that. >> good to see you. >> thank you. >> we go out now with a clunk. we are seeing selling pick up pace here as we head toward the close. is this the end of it, a very save panel coming up to talk about that on the second hour of the "closing bell" with kelly evans and company. see you tomorrow. >> thank you, bill. welcome to the "closing bell." i'm kelly evans on a monday where we continued the selling pressure. we saw on friday that it continued in asia and europe and extends to the u.s. for another day. how we're finishing up the day on wall street. could have been worse. the nasdaq was off as much as 70 points towards the end of the session, looks like we're closing down 50. a rough day at 1.2%. now the broader index, the s&p 500 off 20 to 1845 so not closing above that 1850 level that was being closely read. we're close to the level of the year at 1848. the dow jones industrial average, the blue chips off a percent, 166 to 16,246. got to talk about some of the weakness in the financials today as well. let's bring in today's panel. joining me is author of the new book "all the president's bankers," marcus lemonis and jim gottfried and our very own dominic chu. there's ways to figure out if there's corrections happening in the broader markets or a broader risk-off move. you would like to see them rallying to have a sense that this is contained. >> the conventional wisdom, hit the nail on the head. the conventional wisdom is that technology stocks and financials should lead the way higher or lower for stocks. this there's a good reason, tech and financial represent the bulk of the s&p 500 and would make sense that they would have the most impact. talk about the bank stocks, that's important and what's even more important is whether or not people are rotating out of certain sectors and into others. right now can you not say -- i mean, it's only been a few days, few percentage points that got people spooked and you heard bill griffith talking about it earlier, it's the utility stocks. they have been standout gainers, though modestly, modestly for the past few days, that's the reason why it's important. maybe people are seeking at least right now a little bit of shelter in some of the more defensive and less economically sensitive names >> you know what's telling perhaps is the fact that we actually made intraday highs on the s&p as real entally as friday and lock at how quickly the mentality and momentum has changed. >> it's important at times like these to keep context on these falls and also look for opportunities, and one way which is looking very interesting at the moment is the fact that we've seen a lot of selling in etfs which is broad and good names are being sold along with the more poor and vulnerable names and we're looking at this as a point to go in where valuations have held us back and built up on positions. >> we've been asking people throughout the day whether they have a shopping list, whether they start to nibble here. do you pick up the financials? loves goldman, jpmorgan, all of the big names, right, nomi? >> i think the general instability and financial stocks is part of the bigger picture and the fact that they have rallied quite substantially on a lot of subsidies from the government and more attention that's been focused on them from investors, you know, they still have a lot of problems. they still have a lot of stuff on their books that's rot erng and the fact that qe even still exists, tapered as it is, indicates there are still problems there. in terms of the bigger tech sector and that going down right now, two weeks ago the market was down as well. we're in a period of volatility, and to play it, you really have to be on both sides almost all the time and kind of go in and out. that's why the etfs are seeing the volume they are seeing. that is the safer way to play either side depending on your view. >> let's bring in brian kelly on this point, too, "fast money" trader extraordinaire. brian, what about this? where do you see the selling pressure coming from in. >> it looks as though some of the selling pressure and momentum names have let up and it's now spreading to the names like the financials that you're talking about, some of the retail names, lowe's and home depot and tractor supply, some of the big names that everybody has been in, crowded trades and that's the concern you have here, a lot of psychological damage done over the last couple of weeks, and we'll see if it's fatal or not, but it's a little too early for that, but it is concerning that it's starting to spread to other sectors. >> marcus, what's an investor to do? >> if i'm an investor in this market i'm looking to flee to safety, things with great balance sheets and great earnings. part of what we're seeing on the nasdaq side is the multiples in my opinion are out of control, just too high. >> so much of the focus is comparing the sharp drop that we've seen and the valuations -- the price and valuations of some of these names. two examples in the past. let's bring in peter, president of empire executions. peter, you went through the dotcom peak and crash. >> yes. >> how much of a metaphor or how much of a comparison would you draw to today's action? >> today's action, just like we've heard, it's a little more broad-based. i think that's what's significant, and if we really look at it. a lot of momentum stocks, everybody calls it a momentum stock when it's going up, but there's momentum stocks on the way down as well, so you know what? there's going to be a little more damage, you know, you're talking about very high pe stocks that probably need to get back to reality a little bit, and you know what? i don't think that this is a long-term situation. i think that we're still -- still probably do have more room on the downside. i don't think it's much, but i do think you'll see the momentum stocks and this is negative moment momentum. >> this isn't a couple day event. we're talking about names like at least tesla, amazon, pandora, talking about names off 20% in the last couple of trading sessions. it happens preeti quickly. >> i think the issue is people are tired of the what ifs and what cobs and want to know what's happening right now and while the teslas of the world will be fine, a number of the stocks really need to get in line with these valuations. balance sheets are strong and the earnings just aren't there. >> isn't there also a point about where we've seen, for example, a lot of ipos have come to market. if you look at tech secretary ork the value of ipos is higher than it was at this point last year. however, there are fewer ipos, which is also showing that the amount of hype that we've seen has been concentrated, particularly in the large-cam names and also to try to have the shakeouts and become more realistic on profit growth going forward. >> you getting interested in some of the small caps because that has been an area that's taken it on the chin? >> that's an area where you can potentially get interesting levels of growth but without the hype. companies are still cash rich and also have a strategy for profits, and that's in a lot of tech companies that's what's been missing. >> you know what happens 24 hours from today? alcoa reports, okay, so kind of the unofficial way of kicking off the earnings season which by depending on whose gauge you use is anything from slightly negative to perhaps a gain of 1% for the quarter, that's from a year earlier, so we're certainly not talking about the potential necessarily for some big catalyst. if anything, i wonder the extent to which some concerns about say tech earnings coming up have something to do with the selling pressure here. >> first of all, kelly, you're right, because what happens over the course of the last few weeks is analysts have taken down the earnings growth expectations for the s&p 500 down to just this, 1.1% earnings growth over the same time last year. sales growth a little bit better, about 2.5%, that's what thompson reuters is saying. what it comes down to at a market like there,at a market crossroads, there will be a huge, huge spotlight shown on these companies because like marcus just said, maybe it's a valuation concern. will these companies report numbers that actually say that they are filling into these valuations, or are these valuations so stretched that they cannot catch up with them? >> p.k., go ahead and what's also important is we've had this massive selloff so the bar is very low as we head into the earnings season. they priced in probably the worst case scenario here. >> peter, you think that that's the case? >> i do, i agree 100%, and we'll see what happens by the end of the week. you'll start getting some sort of feel for the earnings, and next week will be very important. obviously friday is extremely important because the financial stock report. >> jpmorgan and wells on friday. marcus? >> as these earnings numbers come out i want to focus on the sales number and see what's happening on the margin side. lapsing big numbers from a year ago or even two years ago. let's see if companies are compressing margins in order to conflate their sales pressure. that's a big deal for me. >> what's quite interesting is in has been one of the most unloved market rallies, and, therefore, it's been one of the most loved pullbacks coming into the earnings season. >> underparticipated in. nomi? >> what you see is the volume that comes in or out, it's morning volume, very sporadic, very weighed to its large orders and that's not indicative of a market where everybody is participating, trying to be the hero and pick the small stock right now, even if the market is ultimately going up because it still has a lot of federal support and fed support and so forth, is still a dangerous play. >> yeah. jim, a real quick -- thinking through this and whether this is just about some of the overextended plays or not, i mean, when you have earnings down 2.5% today, you're talking about the suppliers in the gold rush kind of thing, so i think it tells you more about the weakness across tech include apple and chip names and this cycle more broadly than the fact that facebook paid $19 million for everybody's favorite example. >> although we remain confident in the longer term we knew there would be volume tilts and dips short of attorney. looking where we were last year, the broadest market rally for over two decade, needed to come back and have the shakeout and return to specifics and fundamentals and that's what we're seeing. investor patience starting to wear thin and some of the fundamentals need to come and support the valuations. >> hope that the valuations stick around for a long time. >> brian kelly coming up with the rest of the "fast money" crew at 5:00 p.m. text stocks getting crashed for a third. it is, in fact, the biggest three-day drop since 2007. some say this pullback will be short lived because the economy is ready to take off. vacation sales red hot. what's behind the tale of two housing markets? it all comes back to the stock market, and it's all coming up on the "closing bell." keep it right here. you're watching cnbc, first in business worldwide. take a closer look at your fidelity green line and you'll see just how much it has to offer, especially if you're thinking of moving an old 401(k) to a fidelity ira. it gives you a wide range of investment options... and the free help you need to make sure your investments fit your goals -- and what you're really investing for. tap into the full power of your fidelity green line. call today and we'll make it easy to move that old 401(k) to a fidelity rollover ira. afghanistan, in 2009. orbiting the moon in 1971. [ male announcer ] once it's earned, usaa auto insurance is often handed down from generation to generation. because it offers a superior level of protection. and because usaa's commitment to serve current and former military members and their families is without equal. begin your legacy. get an auto insurance quote. usaa. we know what it means to serve. welcome back. so a new week and a familiar theme from markets which took it on the chin today, including some late-day selling pressure. seema mody, what's behind the selling pressure? >> a tough day for stocks. dow hit session lows at the end of the trade, leading the way down pfizer, goldman sachs, american express, disney and nike. other big losers, visa and mastercard, both losing ground today after reuters said large retailers are muscling into the competitive mobile payment market. mankind slumping after the company said the fda extended the review date of its inhaled insulin treatment by three months and looked like it would be a tough name for big day tech stocks but that isn't until the last hour of stock until the stocks moved off their lows and google and amazon ended the day lower. >> staying with this theme, the nasdaq posting its biggest three-day drop since end of 2011. are investors getting worried here? how much are we impacted? joining me along with the panel is ryan jack on, portfolio manager of the internet fund. ryan, welcome back. we talked on friday when we saw real selling pressure. it's extended into today. are you personally having to, you know, liquidate positions, for example? do you see others doing the same? >> no. i think there's clearly some liquidation pressures in the market. we wouldn't have the kind of velocity of decline that we've seepch we're trying to be constructive here. actually adding to some positions, especially in the smaller cap thames that have taken the brunt of this decline. >> i want to bring in the panel because that's something that gemma was talking about. give us some examples. i can't imagine there's many places where you'd really want to dabble here. >> well, you know, you see, you know, it's very difficult, and some of the smaller cap names, the valuations had gotten a bit ahead of themselves and now we're seeing such a vicious decline that the multiples are still a little on the high side but given the growth rates we're seeing, you know, it really makes sense to be constructive. it's very, very difficult to try to time when the bottom will come, you know, through this correction, and as scary as it is, it just makes sense to participate. >> also, ryan, just a question on that. isn't it also important to remain specific on names? obviously the small-cap sector, one theme within, that you need to focus on those companies that are cash rich, that have the strategies that will be able to profit. >> yeah, we can't really talk about individual names that we've been buying over the last couple of days for compliance reasons. you know, we can say the smaller cap names, obviously tech heavy in our mutual fund, the jacob internet fund, it's tech focused so obviously we feel that sector has been oversold here in the near term, but even some of our broader funds in the health care space and some of the consumer names we're seeing opportunities. >> it's one thing, this is the way you run a fund, an institutional amount of money here, but for the average retail investor out there, how do you exactly navigate through this? mean, it's one thing to say that, yes, we think the sector will hold up, but how do you think the retail investor the average investor should be approaching investing in these types of names? is there a hint of caution that you need when you go into some of these internet stocks? >> you know, i think this kind of volatility is the price of admission. i mean, these are high growth, aggressive, high valued aggressive growth companies growing 50%, 60%, 70% or even 100% a year. trying to come up with valuations is very difficult. >> go ahead. >> as individual investors i think in the same way that you have to be disciplined when the market gets ahead of itself, when you have these kinds of corrections, you have to really have the same type of discipline to not be afraid to add a little bit. again, being selective and not too quick, but to be constru constructive. >> these names could be down another 20%, 25%. do you disagree or do you add to your positions regardless or do you just not have a choice in the matter? >> we don't know. the honest answer is we don't know when the bottom will hit, but what i can tell you is when the market does bottom out, because i do think we're seeing liquidation-related selling, the snabback will probably be pretty significant, so the idea that you'll be able to time this bottom or we'll have a bottom in the market and it will settle down for a while is a bit unrealistic, and for that reason i think you just have to be constructive in small increments and we had some money raised coming into this year and we started to put that back to work. >> nomi, real quick. >> i get that you're being cautious without getting back in, but being as you're doing that, wouldn't investing in a group of names, and i know you can't name which ones rather than very specific targets for the close future where things are going down be more of a short-term play versus a longer term one? >> i'll tell you what i'm struggling with. you sound very philosophical to me. i know you for regulatory purposes can't be specific, but what are you seeing in the short term versus the long term and what are you seeing at the canary in a coal mine? i say something as a canary in the coal mine which is the first to go in and the first to come out? can you be more specific? as investor myself, are these valuations out of control, or should i get on the ride and see what happens? >> clearly the valuations got a bit ahead of themselves and that's why we see we earring a valuation-based correction. take a step back and see how we end the year, improving economy, low interest rate and a fed with a distinctive easy money policy. none of that has changed so i think that will create this undercurrent of demand at certain levels. >> none of it has changed but multiples in the 30s aren't going to work. multiples in the 30s aren't going to work, i don't care how much the growth strategy, is so my question is are you look for multiples in 209s that's safe or multiples in the 30s that's safe? in depends on the company and the growth rate. being a manager is trying to assess risk versus return opportunity. some of our best return opportunities are also the riskiest names, and -- and, you know, we're not going to be perfect. that's why portfolio approach or a fund approach makes sense but in the long term our winners should well outperform our losers. >> that's the idea. thank you, ryan. >> ryan jacob. it's not just tech that's in the red lately. we want to know whether you think the market is in the stages of a healthy pullback. tweet us your thoughts. that's straight ahead. the market had been betting on the economy growing at a decent clip, but did the market bet wrong? both side of this debate coming up, and how much is washington really influenced by wall street? a new book by one of our panelists has some explosive details. you'll want to stay tuned. t to e challenge. they're the days to take care of business. when possibilities become reality. with centurylink as your trusted partner, our visionary cloud infrastructure and global broadband network free you to focus on what matters. with custom communications solutions and responsive, dedicated support, we constantly evolve to meet your needs. every day of the week. centurylink® your link to what's next. ♪ ...work with equity experts... who work with regional experts... that's when expertise happens. mfs. welcome back. so there's a look at the unemployment rate in this country, 6.7%. the improvement on the household side of the survey in friday's jobs report, one reason why economists are feeling better about the growth rate. moody's mark zandi predicting as much as 3% growth still for 2014. for more on if that's an attainable and likely forecast let's bring in two voices, the david malpass and ben white, chief economic correspondent for politico. welcome to you both. are we going to make it? >> we can do that in the second quarter. what we've seen is commercial loans. lending has been picking up, and you saw strong auto sales in march and the household survey jobs were strong, so i think that means that small businesses are beginning to get involved. >> okay. ben, what about you? what do you think? >> i wish i could say i agree with that. i don't really. small business is the key. if we get small business spending picking up, that could change the forecast, but we've been looking for that for a while and it hasn't happened. obviously we've got the market selling off. the housing market is slowing down a little bit. rates going up a little bit. consumers won't have a lot of money to spend. love to see 3% growth, just don't know where it's going to come from. >> i wonder if the markets aren't telling us all we need by the fact that the fed has moved toward a tighter policy than in the past and you can see the reaction in markets. the yield curve has flattened a little bit. gotten some tightening and selloff across stocks. david, you can't ignore that evidence, can you? >> no, we need to look at markets, but i would phrase it, you know, glass half full because equities just hit and all-time high on thursday so we haven't come off very much on that, and i'm actually pleased with what the fed is doing. they are slowing their bond-buying and talking about rate hikes, and, still, we've got a new market high on thursday so that's pretty decent reaction. >> i would say on the market front, we've had markets hitting highs for a while and still had pretty tepid growth and not a lot of consumer excitement, not translating to how people are dealing with their daily life. if they are not seeing gains in their house, not feeling wetty, doesn't matter that the stock market is going up in terms of the economy. >> david, is there a disconnect there or not? >> no. i think the news changed in january so the fed is tapering and commercial and industrial lending is growing at an 18% annual rate so you're beginning to have small business loans made and that's going to help the small business sector, and you're seeing it in the house hold survey where the -- where there's been a big upturn over the last six months in -- in household survey jobs. that's the survey that picks up changes in small business, so i'm -- i think we're on the right track there. >> i think there's some sort of drinking game revolving around small business, david, here, that -- >> yeah, i feel like i've heard this story a lot, kelly, and i'll be looking for the end fib number. >> end fib, explain what you're talking about. >> national federation of independent businesses, that's what they will look for, like the white elephant we're looking for, businesses spending. >> i haven't looked for the upturn so the change here is important. the fed is now tapering so it's reducing the -- the bond buying and that's a positive, so i agree though that nfib indicator, business confidence will be important in confirming this upturn. >> and we don't get it. the other thing i would say, kelly, just in terms of a little more on the glass half full, not there, i'm not that guy, but i do think the -- >> in life generally, ben, or in this case. >> i'm an optimist by nature, but i would say washington is not as big a drag as it was. we don't have the tax increases or the fiscal fights. if there's a time for small business to sort of come out of hibernation, start spending money, buying new cars, new equipment, all this stuff you would like to see to get the growth rate up, this would be it. d.c. won't crash the economy like it has before. >> david? >> ben's over on this side. truck sales were really strong in march. that's good for small businesses. >> so i'm guessing -- david, are you -- are you the glass half full side generally? >> i'm glass half full and i would simply cite that we really went through almost a near recession in 2012 related in part to the risk of the big tax increase, and it's very good to have that off the table, and now we have the fed moving towards normalization, so -- and the euro crisis is -- is at least -- was addressed in 2011 so those are good big things that are making progress. >> and would i say i'm not a glass half empty, like the glass is meh, don't know either way and continue to stumble along which is a couple hundred thousand jobs a month, jobless rate stays where it is, wageless rates don't go up very much. the economy we is there is the economy we're going to get and it ain't that great. >> the volatility in markets certainly reflect the gyrations between the two outcomes. will have to simply wait for a bit more data. >> kelly, thank you. >> does wall street, not washington, really have control over our nation? that's what nomi prins' new book says. our panel weighs in and vacation home sales are heating up of the summer season. rest of the home sales not so much and why this all has to do with the stock market later on the "closing bell." e "closing b" we did a 27-point inspection on your chevy,ce, you got new tires and our price match guarantee. who's this little guy? that's birney. oh, i bet that cone gives him supersonic hearing. watch what you say around him. i've been talking a lot about his procedure... 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(announcer) ranked highest in investor satisfaction with self-directed services by j.d. power and associates. welcome back. there it is, all the president's bankers. that's nomi prins' new book where she explores how much influence the white house has. what's the take? >> going back to the research i looked, i went to all the presidential libraries, and what i found is in their documents and their letters and their correspondence with all of the biggest bankers of their day, there was a tremendous amount of personal relationships with bankers that presidents had relationships with bankers, through marriages and protege and mentor relationships and this is what was going on behind the scenes throughout a lot of america's history and gotten us to where with you are today. >> it would be unusual if any empire would come about without a deeply woven nexus between government and money, would it not? >> absolutely. the difference is we elect the people in washington, and a lot of times the bankers and the families that you talk about in the network and hierarchy have been in their offices in power and in their banks and institutions through multiple decades, and in some cases almost for a century whereas presidents are kind of in and out even though some families of presidents. >> not sure anymore. >> you've got bushes and clintons, that's changing a little bit, but there's certainly a longer term presence through the families and the larger banking institutions. >> the takeaway, is that a bad thing or good thing? it's not clear whether you think that that's a good thing or bad thing that that existed? >> a bad thing in the times when there's the most risk and there's less counterbalance to reduce that risk, so, for example, into the crash of 1929, there was alliances, but we'll do our thing and you do your thing. not on the same team in terms of the economic stability overall and we had a tremendous crash. through the years after that, from the '30s to the '60s, lbj had bankers at his ranch and all that stuff happened and more alignment in terms of restraining the risk and growing the whole economy and all of the incomes throughout americans, not just at top echelon, and now we've gone back to where we were before the panic in 1907. >> these bankers are dictating policy for the citizens and in the bad times they are protecting their wealth. >> they are always protecting their wealth and always trying to increase their wealth and in the better times, in the more stable times for everyone, there is more of a walking and chewing gum sort of situation where they can also see the greater good in the public interest and the presidents were good at their jobs where good politicians can utilize that and put for the more stabilizing policies. >> as an investors, in terms of what's the future outlook for the banking sector and the relationship for government, in that respected, how much government is going to interfere and how much they can regulate the financial institutions. the consensus is that financial institutions are becoming from this pressure, are becoming more stable and less profitable, you know, what's your view on that? >> i don't think the biggest institutions are more stable, and i don't think they are less profitable. if you look at just how much stocks and banks have gone up since early 2009 when the fed opened up its qe program which now has the federal reserve books at over $4 drillion, $1.6 trillion have bought mortgage securities and so forth, the longest period of zero interest rate policy that we've ever had in our nation's history, there is a lot of help there but it doesn't mean there's a lot of inherent stability. as an investor i would be concerned as to what amount of the perceived health is related to the paving over in the government subsidies and what's real? >> you can suddenly see more curveballs coming out there. you can see there are inherent risks that could hit the financial markets and hit financial institutions and we should be aware of that as an investor? >> absolutely. talk about the fed, as long as it's tanker and buying a substantial amount of mortgage securities, those are coming from somewhere, and they are coming from books where they are hurting the banks of books and where banks are continuing on and need to be purchased. >> this is cyclical, as you go through the banker and presidential relationships, there are ebbs and flows, public scrutiny over banks and the administration. does that mean sometime in the future we go back towards another time in the market that we maybe have seen sometime already in the past? >> i think because we haven't really reformed -- yes, we have regulations, but they are minor and they are lobbied and they are discussed ad nauseum, but we don't have a real restructuring of the banking industry when fdr and republican bankers running chase and national citi bank have survived, now jpmorgan and part of citi group, worked together to create, for example, the glass/steagall act which wasn't an act of congress like people think. it was a political, financial policy that was done to stabilize the banks for themselves, and as we know that worked, they are still here, but also the greater population for longer times so i think things might not get worse in the very near future but because things haven't been reformed they have the potential of us seeing a really big crisis, bigger than the 2008 crisis before we have a long-term stable pullback. >> so your focus is very much on self-interests, and, therefore, we need to be forecastused on where that interest is coming from, the personalities in play. >> there is a tremendous amount of personality. in the '60s there was a lot of alignment, bankers wanted to be rich and there was a little bit more stability because people were working to the. now it's a little every institution for their own and they are still joined at the hip. >> ben franklin is still running the country. >> nomi, thanks. >> the weather is heating up. the top three web stories are just ahead. up next we'll tell you how the stock market is fueling a vacation home buying binge. ome . huh, fifteen minutes ome . could save you fifteen percent or more on car insurance. everybody knows that. well, did you know bad news doesn't always travel fast? 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(all) awesome! i love logistics. welcome back. we've known for some time now that cash is king and that certainly seems to be the case for home buying of late. diana olick joining us now with some surprising details from this part of the mortgage market. diana? >> reporter: a new report saying nearly half of all home sales are in cash and that mortgage lending is now at the lowest level in 14 years. that from black knight financial services. blame some of that on a plunge in refinances due to the jump in rates last year. refi applications are down 67% from a year ago, but to buy a house those mortgage applications are down 17% from a year ago. now i spoke to paul miller at fbr who has been revising his numbers down for mortgage volume every month. he was at 1.5 trillion worth for 2014. now he's down to 1.1. compare that to 1.9 trillion worth of mortgages made in 2013 so besides higher rate, what's the problem? credit standards which usually come down when refi demand drops off. it's not easing. only about 20% of 2013 loans went to borrowers with a fica score lower than 720. despite what we heard of wells fargo dipping back into the subprime, that's a small subset only through a. miller says other banks said no way will they go below 700 fica because they are too concerned if loans go bad they will have to pay up to fannie, freddie and the fha. kelly. >> diana, thanks very much. meanwhile, an entirely different story for the second home buyers' market. sales jumping 30%. reason, investors who have had a part of the bull run in the stock market are using the profits for a beach house. joining me now to discuss along with the panel is ryan sirhan. you might recognize him from bravo's reality show "million dollar listing," after my bedtime, ripe, but welcome. >> thank you. thanks for having me. >> the new york market a little bit idiosyncratic. how is the market influencing buying trends? >> by a lot, more so this quarter than i've seen in a long, long time. i think that as people come home with more disposable income, they are looking to place it in greater assets and i'm seeing a lot of buyers purchasing vacation homes, not to take them now but to take advantage of the good deals out there now thinking that the market will continue in the upward trend in the next 12 to 24 months. >> ryan, two questions. number one, how much is being driven by this fear that the good rates are going to go away, a how much is being driven by the fact that you have 12,000 people a day turning 50 years old and that's their future home? >> sure. you have a lot of people who are driven by fear. fear drives consumer confidence one way or the other, so if everybody is purchasing because they are nervous about interest rates, then everybody is going to follow leader. as interest rates will continue to plateau, i think then we'll see these numbers start to decline. >> but if they are buying on cash, what is -- what is the connection -- for those cautious buyers to interest rates i? understand the ones coming in who might be trying, to but what's -- what's the cash? are they scared, or are they simply looking to expand or some combination? >> i think it's a mixture of both? everyone purchases real estate for a different reason. not everyone is a flipper, someone looking to invest. a lot of people now and what i'm seeing now as i run around the city with buyers and in our offices in the hamptons and in los angeles, that there are people who have have just been sitting on money, still. not everybody came back into the market into 2013 which we're now looking back as the year the market came back, so you still have a lot of people who have just been sitting on cash looking for a place to put it and now deciding to put it into real estate instead of waiting any longer. >> speaking of follow the leader, i was just out in the hamptons this past weekend, and i've got to tell you every third -- >> were you property searching? >> i was not property searching. i'm not the hamptonsish kind of guy but i will tell you what i say impeerkically. every third house i drove by had a for sale sign. is there a concern that the market will overwhelm whatever bid there was last year carrying into this year? >> it's possible, and in the hamptons, you're dealing with a somewhat different animal because you're now seeing prices finally pick back up. i mean, the market came back in new york city last year tenfold but the hamptons took a little bit longer time. now as the supply and demand is basically shifting on that see-saw i think you're seeing people saying, okay the market is good now. i don't know where it's going to be in six months, i don't know where i'll be in six months, sell it now, cash out and at least i'll be okay because i don't want to find myself in another 2009. >> ryan, got to hop, but last question. how would you describe the market for second home or vacation homes generally? is it underheated, relatively normal or overheated? >> i would think that it's still slightly underheated. i think that the average price for an apartment in manhattan only just surpassed the height in 2008, so the second home market, we're going to see that probably the next 12 months so if you're looking to buy a second home, do it now before prices get really crazy. >> we understand that you can tweet or message ryan to buy properties these days, too, big trend separately. thank you, ryan, so much for joining us this afternoon. >> thank you. >> appreciate it. >> we've got some breaking news on the federal reserve. eamon javers has the latest. >> that's right. the federal reserve is giving banks an additional extension on a piece of the volcker rule. let me explain to you what the fed is just saying in a release. they say they will give banking entities two additional one--year extensions to conform their ownership interest in and sponsorship of certain collateralized loan obligations. that's a piece of the volcker rule so banks will have a little bit more time here to get right with volcker, that's probably going to be a relieve for some of those people responsible for implementing that very complicated rule making process. kelly? >> eamon, thanks very much. a quick reaction from the panel. nomi, seems like the obvious place to go here. >> kind of exactly what we were saying in the last segment. things aren't that healthy. on the one hand banks using any power or any muscle that they have to extend any aspect of the volcker rule. on the other hand, you're talking about the area that's related to loans, that's related to mortgages which is still a hangover from what we experienced in 2008 and 2009 so this is just an indication that things aren't healthy as well as the muscle coming into extend that longer. >> i will just say it's been interesting to watch this space because all the while we're focused on what's happening in the stock market, on the credit side there's been a lot of activity lately, pes legs any collateralized loan obligation space. these are bundled loans. last week was the busiest week so far this year, and there's a lot of people looking for demand for credit product. to some extend it could maybe help kind of get the financial lifeblood moving that we need. >> but there's a reason why, kelly, a zero interest rate policy. everyone is reaching for yield. going for collateralized debt obligations and collateralized loan obligations because that's where you can get the extra bit of juice you can have. >> part of the rules have been aimed at clarifying what you put in a clo. there's lots of different kinds of bonds and loan products in the past so these should be more pure vanilla names. whether that includes things like securitized nigerian loans, for example, is another story, caveat emptor. gemma? >> isn't there a risk that a lot of investors are missing. a while back, sns, and their debt was actually bailed in, and bailed in, it means that the subordinated debt of this financial institution was basically cancelled, and the reason why this is so important is that it meant cds protection no longer counted, no longer bonds that could be swapped for the cds payout and that means there was a lot of unprotected risks in the market and a lot of traders aren't there aren't able to hedge their risks so if they are forced to sell they can't wait this out any longer and this is something that's very crucial if we continue to see volatility in the markets. >> to the extent that they are sort of open for business on this front, it's a more encouraging sign for what's happening on the stock market with regard to how far and deep the correction might go than if the door had been slammed shut by participants in the market or if this had gone completely away. in any case, kind of a specific wonky thing happening this afternoon but an important one nonetheless. up next the cnbc.com hot list and tomorrow earnings seasons returns. alcoa is up first and we'll get the inside view. that's all starting in 24 hours. we'll be right back. pags to be this awesome. and you...rent from national. because only national lets you choose any car in the aisle... and go. and only national is ranked highest in car rental customer satisfaction by j.d. power. 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(vo) meee-ow, business pro. meee-ow. go national. go like a pro. the owner of a vehicle, with a bumper sticker, "turrible" your lights are on. you wanna get that genius? not mine. on the passenger seat, there is a collection of charles barkley highlight dvds. must be a big fan. and the license plate reads "sir charles." i'm gonna get some drinks with my capital one venture card. be right back. earn unlimited double miles with no blackout dates from the capital one venture card. forgetting something, sir charles? what's in your wallet? . welcome back to the market selloff. the top three stories, let's bring in managing editor alan and so it's still holding people. if anything it's probably more interesting that it continued today than it was contained or rebound? >> rolling on. rolling on. the readers, you look at the traffic patterns on our site and it's a quest for why. patty dom saying that the shakeout in stock is likely to continue. her main thesis is the economic numbers and gains we have seen isn't enough to outwrestle what the fed is doing, slowly withdrawing stimulus. she talked to a lot of traders today kind of supporting and bringing out her argument. we have also seen the wise man affect on the website. he says the market is likely oversold. but that doesn't mean it won't keep still selling down. he's concerned about etfs unwinding. when you dump one, the formed have to dump too. so on and so on. there's be a lot of argument about is the government doing the right thing. he argues that in fact they are. they're tightening their fiscal belt and the feds doing just the right thing at the right pace to get out of the market. interesting fight going on on the website. trying to figure out what's going on, kelly. >> thank you, alan. >> take care. >> appreciate it. we had ron on last week. i think it was thursday calling for a 15% to 20% correction and i was saying today? and he said yes. so these the extent of the debate is how much, how long, how much further? >> remember back in 2011 and we were talking about this a couple hours ago, back in 2011 we saw an 18% drop from i want to say around april to october. and people thought that was the end. that was the top of the market. fed couldn't do anymore. we were going to roll over. yet we did not. >> but that had to come back -- >> and you're right. but nobody knows exactly whats the future is going to be. marion bartell before this hour of programming, she said nothing fundamentally changed. you've got to wonder whether or not some other traders are seeing a real reason. >> people are saying we went from an 11 month trend of 200 k now down to 191. there are some people who will say we have lost momentum here and these what the weakness is telling us. >> i think it's more about -- this is bringing the conversation we held earlier on well the glass is half full or empty. i would say there's that joke that the optimist and pessimist. well, you were arguing about the glass of water and i drank it. there are fantastic opportunities being thrown up. instead of focusing on how much longer have we got to go down before we go up, it's about focusing on what do you want to buy any way. >> and that's a perfect place to tease your final thoughts. it's twitter time. we have been asking if you think the market is in a healthy pullback. some thoughts. with centurylink as your trusted partner, our visionary cloud infrastructure and global broadband network free you to focus on what matters. with custom communications solutions and responsive, dedicated support, we constantly evolve to meet your needs. every day of the week. centurylink® your link to what's next. 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[ male announcer ] open your eyes... to the 6-cylinder, 8-speed lexus gs. with more standard horsepower than any of its german competitors. this is a wake-up call. ♪ so taking the retail investor we asked to tweet us is this is the beginning of healthy pull back efforts. one saying this has been one of the most pull backs in years. and one, it's only healthy for gamblers and traders and not long term investors. finally, markets are going into a healthy pullback great for young investors like myself. you agree? >> i do. we have some stocks that have gotten ahead of themselves riding on exuberance coming back to the fundamentals and getting focused. for a young investor it's great to study the balance sheets of these companies. >> i suspect in a couple years you're going to go in there and have to tell them how to clean it up. >> small businesses are spending money. unlike the report you did earlier, the spa is lending healthier than they were five years ago. are they more conservative, of course. but they have spending money. >> i think this is a market rally in which most of america isn't participating in outside to their economic personal environment. the fed may be tapering but still will have a $12 million book at the end of the year. there's a lot of cash coming in and there's the real people in the real world that's going to continue to be on the other side of that. >> it's a five second thought. after all, dom? >> i like finding stuff on sale. that's six. i'm sorry. >> i'd re-examine what you mean by risk and safety. we're rotating from the core of europe where you see better growth and up side and it's safer. >> thank you all for being here. "fast money" coming up now. melissa straight over to you. >> we start off with the market ale alert. "fast money" starts right now. the selloff has spread far beyond the tech names. even pharma companies being get today. there are other sekt tos showing cause of concern. perhaps it's concerning because people might be ringing the re

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