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tv   Closing Bell  CNBC  November 14, 2013 3:00pm-4:01pm EST

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>> i pick it up off the sidewalk. >> lovely. we'll look forward to that garbage. meantime, markets are moving higher today. sitting on record highs right out of the gate. there you go. up by -- >> where's your christmas spirit? >> you're the one who said you're not buying anyone anything. >> thank you for watching "street signs," everybody. even you, jacob marly. >> "closing bell" with a much better attitude is next. hi, everybody. good afternoon. welcome to the "closing bell." i'm maria bartiromo. we're going for another record close. >> all we need are plus signs for the dow and s&p. i'm bill griffith. markets responding positively to the testimony of janet yellen before the senate banking committee as they consider her for the new job of fed chairman. and she was as dovish as we knew she would be, maria. that pushed interest rates lower
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today and stock prices higher. by ifthe way, the dow would be lot higher if it weren't for cisco. earnings you were talking about last night. >> that's right. two big news making interviews coming up. u.s. commerce secretary penny pritzker on the program. so much to speak to her about. from the health care law to her priorities now for businesses. how to get them to spend their money on hiring instead of things like buybacks. that's exactly what we spoke as well about last night. also ahead, legendary actist investor cliff robbins of the blue harbour group. don't miss that. speaking of health care, you saw live here on cnbc the president today making some administrative changes to the health care law. now you really can keep your plan if you like it. but only for one year. and only if insurance companies can reverse everything before the end of the year. in fact, those insurance companies are telling us here at cnbc they feel like the white house has left them holding the bag on this one. and they are not happy. we have a lot more on that story coming up in a little bit here.
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>> for sure. we'll look at the impact. first, let's check the markets as we are once again in record territory. dow jones industrial average hitting an all time high yesterday. now above that by 40 points. about a quarter of a percent higher at 15,862. nasdaq composite also showing gains today, though not as strong. up just a fraction. 3.5 points. s&p 500, again, record territory here with a gain in the session of seven points. about a third of a percent at 1788. >> let's talk about the latest market action in our closing bell exchange with danny hughes from divine capital. lindsay from stern agee. ron mullencamp. keith fitzgerald from money map press joining us as well. lindsay, no surprises, i guess, from the janet yellen testimony today. she's dovish and she wants to continue policy right now, right? >> that's exactly right. no surprises. which is exactly why the confirmation process and the transition of power from bernanke to yellen is likely to be seamless.
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as expected she continued to champion the policies of the fed that are already in place and continued to expect further accommodation as the economy gains more momentum. she did point out the recent improvements as of late but has said against the backdrop of a still heightened unemployment rate, there was still room for improvement. overall she gave off a great presence. she was calm, she was articulate and gave the market no surprise with a very dovish tone and testimony. >> so what do you do, then, from an investment standpoint, ron? do you still buy stocks here and are you able to find good values where we are currently? >> we always look for good companies at cheap prices. it's getting very hard to do it. my encouragement this summer was it looked like the fed would be able to taper and they didn't. what we all thought was a temporary process has been temporary now for five years. it looks like it's ongoing further. as you know, treasuries went from 1.6 to 2.6 in about two months and went on to 3. that's about 80% of where they should be. 10 year should be on the order
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of 3.5%. it gave the fed a great chance to start pulling back and they're not. so we're faced with -- with manipulated markets going forward. which is in my opinion, that's why companies aren't buying nor building. they don't know what the rules are. >> what would you be doing if you're janet yellen today? do you want to raise cash or are you still invested? >> we're playing it on a stock by stock basis. as long as the earnings come through and revenues come through in ways we believe are okay -- it's hard to find good values. we're playing what we hold on a stock by stock basis. >> keith fitzgerald, if anything you think it's possible janet ye yellen might increase the amount they're buying as part of quantitative easing, not taper right now. why? >> i do. i'll tell you, i think she's focused on statistics that are more cooked than the christmas goose. unemployment, for example, there's a lot of people leaving the work force which means the number is below what it should be. i think at the same time, corporate earnings which are still growing are slowing. the fed is the only one with the playbook capable of making up
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this gap. i would not be surprised to see her actually take $85 billion a month up to $90 billion, even $100 billion on the outside. >> what would that do to interest rates, do you think? >> it's hard to say. i think she's going to try to hold interest rates low. i think we'll see them through 2017, maybe even 2018 if the fed is successful in doing this. again, they're trying to engineer a recovery when in reality i'm getting increasingly concerned they're building another bubble. i'm a reluctant, reluctant bull at this point. >> what about you? >> you have to be in this market, maria. you saw what the market is doing today. it's going to continue to do that. what he can can really expect is that the s&p is trading now a little higher than average. about 15 times forward earnings. it's not that expensive. money managers are having a hard time finding out if i sell this, what am i going to buy? you have to participate. companies are borrowing money at zero and buying back their stock. we're going to continue to see buybacks go through the roof. because that's the only real way they can continue to attract
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investors. there's no reason for companies to actually, you know, put out infrastructure or invest in real productive assets right now. there's really no legislation behind it. until there is, we're not going to see that happen. >> dani, why in the world does the stock market go higher when you have important companies like cisco with the kind of guidance they provided? we can provide some other names during this earnings season. i mean, for the most part, yes, earnings have been pretty good. you had some important companies that were providing some lower guidance here. showing that they're expecting order flow to be slower than they had anticipated. that stock is getting killed today. >> right. >> yet we're here at all time highs. >> because companies are finding it very hard to increase earnings at the rate that they have since 2009. the only way that they can really do that is by borrowing money, buying back their stock and making acquisitions so that they can actually get that bump in eps that they need in order to attract investment. that's why the market, at least for a short term time, you still have to play this market. because that's where all the
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action is. you can't put the money in the bank. >> ron? >> $85 billion a month has to go some place. >> right. what about international? i continue to hear that the valuations are better in europe. that people want to find opportunities in some of these beaten up areas. is that a place, do you think, to park money while we see this market settle out? >> i don't know any place you can park money. if you're a little bit adventurous and understand what's going on in europe, things are no longer getting worse there. they are probably turned. that's probably a place you can shop should you want to. >> lindsay, could you see the fed increasing its bond buying program as keith suggests? >> you know, i really don't. unless the economy took a very sizable misstep. unless we saw a reversal in the trend of the unemployment rate. if we saw monthly job creation fall below 50,000. maybe if growth teetered with .1 or tenths of growth near negative territory. the most thing from the testimony is she's able to keep accommodation in place. current accommodation in place.
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she's also pointed out one of the key mandates of the fed is financial market stability. he's also keeping an eye on the fact that a potential bubble could be created from inflated asset prices. right now i think she's willing to hold at 85 unless we risk falling into recessionary territory. >> the fed is never on time. that's what we learn. the fed never times it exactly right. don't look to the fed for that timing. >> always playing catchup, that's for sure. >> we'll leave it there. thanks, everybody. stocks do continue to head into unchartered territory. dominic chu. >> thanks so much, bill. we're going to begin with cisco systems moving lower. also as its first quarter sales came in about $300 million below consensus forecast. to make matters worse, the networking equipment company warned of an 8% to 10% drop in second quarter sales because of weak demand in the emerging markets. now, department store retailer kohl's to the downside after posting weaker than expected
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third quarter earnings and sales. same store sales were down 1.6% from the same time last year. hue lewlett-packard lost ground after it halted sales of chromebook 11. two companies making their debut on wall street a successful one. tandem diabetes care soared. and the textbook publisher emerging from bankruptcy last year now public and to the upside. maria and bill, back over to you guys. we're in the final stretch of trading. we've got the market higher, in record territory, with about 50 minutes before the closing bell. dow industrial up 47 points. president obama saying now you can really keep your health care plan if you like it. but insurance companies, can they even do that at this late date after they've already canceled many of those plans. we'll talk about that coming up.
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also, will obama bm cacare impact american businesses? an exclusive interview. stay with us. vo: two years of grad school. 20 years with the company. thousands of presentations. and one hard earned partnership. it took a lot of work to get this far. so now i'm supposed to take a back seat when it comes to my investments? there's zero chance of that happening. avo: when you work with a schwab financial consultant, you'll get the guidance you need with the control you want. talk to us today.
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welcome back. new details are emerging now about a potential jpmorgan settlement with the country sfwl the long awaited deal between jpmorgan and the justice apartment appears close to completion. i'm told it's all but done and is in the process of being finalized. we may see it announced as early as next week. apparently the justice department and other agencies involved are currently debating the timing and where and when of how to announce it. this accord would be a $13 billion settlement to settle issues that jpmorgan adopted or took part in shoddy lending and mortgage management standards in terms of selling mortgage-backed securities before the housing
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boom crashed. and it would have a $2 billion penalty portion. the rest of it, the $11 billion, would likely be tax deductible. one other key point that's been resolved in recent weeks was that j prgs morgan has agreed not to pursue a washington mutual receivership to recoup of the costs it has incurred as a result of bad loans originally handled by wamu, now, of course, part of jpmorgan, bill and ma rhee wra. a number of loose ends having been tied up. sounds like we're fairly close to seeing this come public. could be next week at the earliest. >> very good. kate kelly, thanks very much. bob pi ssani, i liked art cashin's line. talking about janet yellen, he said they were so nice to her, they did everything but buy her a corsage. >> i thought bob corker was going to ask her on a date at one point. what happened the upshot of the janet yellen snooze fest, i say that with respect, it was a masterful performance, the upshot is they're going to give
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her time to continue the bond buying programs until she's satisfied the economy is turning around to her satisfaction. i don't think that's going to be forever. these will get a little more contentious as time goes on. she clearly bought herself some time. the upshot for the stock market is what i call the beta trades are kind of back on. for example, stuff that's gotten beaten up a lot. internet stocks. high beta stocks. chinese internet stocks. emerging market stocks. put up the eem today. that thing is down about 8%, heavens, in the last six, seven, eight days. it's got a nice rise today all throughout the morning as janet yellen's testimony was on. see that bounceback today? that was happening as janet yellen -- the beta names. stuff that moves more than the markets definitely back on today. >> under normal circumstances, though, an earnings report like we got from cisco last night, which has taken a toll on that stock today, that would have affected the whole market today. >> that's right. >> but you got the fed -- the
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quantitative easing impact that's still affecting the stock market. >> that's right. right now sienna is affecting a particular part of the market. any of the networking stocks. look at a stock like sienna or stuff that sells into the internet equipment -- the networking equipment space. ffiv is out there. their stocks are down. networkers are down. even outside of that, most of the tech areas is not down anywhere near as much. they're moving along with janet yellen, assuring everybody that the market for the time being can assume we're going to continue the bond buying program. >> yes, indeed. bob, thanks very much. we'll be checking back with you later. maria? the commerce department had been without a permanent head for over a year before penny pritzger was sworn in this summer. at a time when businesses in the country are facing head winds from an economy that hasn't kicked into high gear just yet, she's sent a loud message with this sign on her office door. it simply says "open for business." joining me now in a cnbc exclusive is the new secretary
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of commerce, penny pritzger. good to have you on the program. >> maria, it's great to be here with you. i am so happy to be here. you know, it's -- i've been in this position now for about four months. i wake up every day. i think about how do we create the conditions for the economy to grow and create jobs? and so i'm so pleased to be able to talk about our open for business agenda. >> when i want to hear your top priorities. then i want to come back to you and ask you a little bit about some of the ideas we are hearing from ceos like john chambers was on the show last night. he keeps pouring money into these stock buyback plans. and we want to find out how we're going to see some of that money used from corporate america that they're sitting on to create jobs as opposed to buybacks. why don't you take us through your top priorities in this role right now, secretary. >> absolutely. so our top priorities include trade and investment, innovation and data.
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we need to create an economy that is exporting more and attracting more foreign direct investment. and we have a great opportunity to do both. the commerce department provides an enormous amount of support for exporters. and we are -- now have a new program that we just have been implementing called select usa, helping companies come to the united states. so with those two plus additional free trade agreements, i think trade and investment is a great opportunity for growth for our country. in terms of investments, manufacturing. we need to continue to invest in manufacturing in this country. it is where innovation comes from and innovation is what can drive growth in our country. as well as our digital economy. we need to protect our digital economy. keep it free. keep it open so that we can continue to innovate. as well as skilled labor. really important that we invest in our workforce. so they have the skills that
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businesses need. i heard from business leaders that one of their number one challenges that they face is finding enough skilled labor. >> right. >> finally, data. the department of commerce is a treasure-trove of data. we provide just at our national oceanic and atmospheric administration, we provide two terabytes of data daily that supports a very large multibillion dollar industry that provides weather information. whether it's the weather channel all the way to, you know, weather apps that are on your smartphone. and we have so much more data than that. -- terabytes more data that we could be making available. we have data at our census burro. we have data from the american community survey. >> what can we say that's going to do? how can we capitalize and use that data best then? explain why this data is so important. >> what we know from what we've seen with our weather data is that if we make that data
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available, there are entrepreneurs all over this country who know how to use that information to create new decisioning tools or new industries that can be used to help american businesses grow, to help consumers get access to information, or to just protect our communities if the weather is bad. and so it is -- that's an opportunity. and we're beginning to work with the private sector to figure out how can we take advantage of what is a treasure-trove of information. >> that is terrific. and your priorities are very straightforward. you've gone through these priorities. but i want to talk about two things that keep coming up from business. because i think everything you just said, we can all buy into. and we recognize that, yes, of course, we need to invest in our manufacturing. yes, of course we have to bring jobs to america. and at the same time, companies are sitting on trillions of
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dollars in cash, and when given the opportunity, they're actually using that cash to buy back stock, you know, that's been a consistent theme. and they are not creating jobs. so health care, the expense of health care and tax policy. got to get your thoughts on these two things. because that's what we keep hearing needs to be done. john shachambers last night saie need to have a policy that allows and enables and encouraging businesses to take all the money they've got abroad and bring it home to america and not get killed in taxes. can you come up with any solution to that? >> well, this administration supports business tax reform. the president has come out very much in favor of lowering corporate tax rates and encouraging investment in the country as well as supporting infrastructure investment through business tax reform. and so there's an enormous opportunity, and it's something that we need to do so that our businesses can be globally competitive. and this administration is behind those kinds of changes.
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>> so you think we'll see that? you think we'll see that materialize, then, a tax reform? we've been talking about this for a long time. >> well, i'm very hopeful. because i see businesses coming together. so as opposed to supporting their individual sector or parochial interest, they're saying, no, no. we need a collective change in order to keep our competitive edge globally. >> yep, yep. the otherish shoo issue, of cou health care. many businesses, particularly medium and small businesses have said the new health care law will impact their investments in people and in expansion. how do you think that concern can be addressed and removed? how do we get people to look at the health care reform and, in fact, not feel like it's a burdensome expense? >> well, look, health care, i've run a number of businesses. i've started a number of businesses. health care cost volatility can wreak havoc on a business. so one of the goals of the health care bill is to be able to have a more predictable
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health care cost. make sure everyone's covered, and make sure we have a predictable health care cost. what we've seen is, we see cost growth moderating. that's helpful for business. that allows businesses to plan, to know how much money they have available to invest in their business, or to use for other purposes or to pay people more. so i think that we have to get this, you know, implemented so that we can have -- reap the benefits from the bill. >> have you been meeting with business leaders, secretary? >> yes, i have. i've met with hundreds of business leaders. i went on a listening tour during my first couple of months in office. and i was everywhere from albany to orlando, nashville, portland. i was in denver. i was down in new orleans, in houston. all over the country. and i heard from -- my -- the agenda of the department of commerce that we've rolled out today was very much informed by the hundreds of business leaders that we met with all over the
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country. and they're very much in concurrence. they've said, trade. number one priority. give us free trade agreements. help us export. help bring more jobs to america by getting foreign companies to invest here. >> yep. >> you know, immigration reform. they support immigration reform. they want investment and infrastructure. these are things that we're behind in this administration. >> secretary pritzker, we'll be watching the developments. thanks so much for sharing your priorities with us today as you launch it. we appreciate your time. >> thank you, maria. thank you for having me. >> we'll see you soon. secretary penny pritzker joining us. bill? 35 minutes left in the trading session here. holding steady, the dow in positive territory. record territory. up 47 points. the s&p also in record territory at this hour. meanwhile, the retail sector has been red hot. up more than 40% this year. but up next, sam stovall says there are only a handful of retail stocks still worth buying. his shopping list coming up. boeing union members in
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washington state overwhelmingly rejected a new contract proposal that would have guaranteed their jobs for years but also would have raised their health care costs and eliminated their pensions. now those jobs could be heading to another state as a result. union workers are mad at everybody right now. boeing and their own unions. that story still ahead on "closing bell." the american dream is of a better future, a confident retirement. those dreams, there's just no way we're going to let them die. ♪ like they helped millions of others. by listening. planning. working one on one. that's what ameriprise financial does. that's what they can do with you. that's how ameriprise puts more within reach. ♪
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bny mellon. welcome back. walmart edging higher today despite a mixed earnings report. courtney reagan wrapping up the numbers. >> the magic of macy's, that
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seems to have just kind of stayed there. competitor kohl's reporting disappointing sales. walmart's quarterly results aren't inspiring a whole lot of confidence either. the world's largest retailer did beat profit expectations by a penny with eps of $1.14 a share. revenues short of expectations. the key u.s. same store sales measure fell 0.3% from last year. the full year guidance a bit muddy with some negative impacts from closing stores and closing business units. still, though, shy of consensus. walmart u.s. ceo bill simon saying unemployment, job stability, those are top of consumer concerns for the retailer. saying that while gas prices have fallen, it's still a big piece of the budget for shoppers at walmart. simon did say walmart is encouraged by the momentum coming out of the third quarter and that comps and traffic improved through the quarter. walmart shares have reversed their early losses. mid market macy's was strong. lower end walmart was week. where will the high end fall? we got a clue today with nordstrom. they report after the bell.
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street looking for earnings of 67 cents a share on $2.87 billion in revenue. same store sales are expected to fall slightly. bill and maria, back to you. >> thank you very much. should investors be loading up on retail stock like a snonordsm or walmart? >> sam stovall still sees opportunities. he says you need to be far more selective in the sector. first off, give us the headline. you and i were just talking about this a moment ago. going into year end, what do you see for retail stocks? >> well, the headline is that if you use history as a guide, obviously it's not gospel, that you end up seeing the retailers underperform the market. six of the nine retail subindustries in the s&p consumer discretionary sector have beaten the market. only 30% of the time or less in december. whereas flip that on its head. nine out of nine have beaten the market about 60% of the time or
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more in march. so usually there's weakness just as investors are expecting to see better holiday sales, et cetera. so in a sense, buy on the rumor, sell on the news. >> we're just looking there. happy news. 40 days, 8 hours, 30 minutes, 15 seconds left before christmas here. let's show the list of stocks you consider bargains right now. what's the theme here? it's a pretty eclectic mix. >> it is, bill. i'm waiting to find out what you got me for the holidays. anyway, what i did was since my focus is on the market and on the sectors doing the historical studies, i leave the stock picking to our analysts. but i'm also the kind of guy who likes to wear a belt and suspenders. so i look to our stars, which is our qualitatively analyst driven recommendation system and fair value, which is our quantitatively system. my thought is that if i can get a buy recommendation on both of those, then those are the stocks that i'm going to be suggesting.
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so in this fwrugroup, the stock that typically underperform in december are specialty retailers. pet smart on staples could be a good buying opportunity in december if we end up getting the same kind of soft sales and soft prices then. ditto for nordstrom which is going to be reporting at the end of today. we like them. but traditionally the department stores tend to underperform in december. >> well, i mean, you know, you've got a big mix here. but are there categories that you believe will do better than others going into the holidays? in other words, the high end has been doing quite well, right? look at the auction we saw the other day. southeby's and christie's. break it down in terms of categories. what you think will perform well and what will underperform. >> i think that when you look at things that also contribute to the retailing space, we think that coach should do relatively well. so there being a high end
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category. a lot of names that are on the list are not necessarily your high end companies. i think a lot of those have already been bid up. so we're looking for those companies that could benefit from cost cutting efforts, could benefit from margin improvements as well as market share gains. and so that's why we have other names. also in the auto retail space like carmax, like auto nation. this is a group that bucks the trend typically has beaten the market 75% of the time in december. >> all right, sam, thanks. good to see you. >> thanks a lot, bill. thanks, maria. the final stretch of trading. about 30 minutes until the closing bell sounds for the day. a market that is creeping higher. up another -- in record territory, 51 points right now. 15,873. of course, most people believe this historic rally has been fueled by the fed. a new study surprisingly states the fed's easy money policies have had no, that's right, no impact on stocks. coming up, we'll hear from the co-author of that study. >> come on. >> you're going to talk to him
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here. as well as dennis gartman. who's like you. he says to put it politely he begs to differ with the results. just a few hours ago the president presented a fix for his health care law. and the insurance industry is not happy about it. in fact, some have told cnbc this is a joke. this is no laughing matter. we'll tell you why next. (announcer) scottrade knows our clients trade and invest their own way. with scottrade's smart text, i can quickly understand my charts, and spend more time trading. their quick trade bar lets my account follow me online so i can react in real-time. plus, my local scottrade office is there to help. because they know i don't trade like everybody. i trade like me. i'm with scottrade. (announcer) ranked highest in investor satisfaction with self-directed services by j.d. power and associates.
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it was facing potential democratic defections for a new house vote on obama care tomorrow. the president made a move to quell that dissatisfaction on capitol hill and main street. in doing so he seems to have firmly left the insurance industry dissatisfied. john harwood has details. >> reporter: they are extremely dissatisfied. there are two parts of what the president sadid today. one is this fix. he told states and insurance companies that they have the latitude under obama care to extend policies that don't comply with the affordable care act into 2015. as late as the end of september 2015. that's nine months longer than they currently can do that. but insurers have priced their products for 2014 based on the new structure, the new benefit
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structure. and they've also sent out those letters. so it's very difficult to accomplish. we've seen both the american association of health insurance plans and individual companies like etna saying we need more relief in order to make this happen. because of what the rate structure has implied for their business in 2014. now, the second part of what the president did was try to apologize even more fulsomely than he has before for the messed up rollout of the law. he turned -- he's a sports guy. he turned to a sports analogy for what went wrong. >> i think it's legitimate for them to expect me to have to win back some credibility on this health care law in particular. and on a whole range of these issues in general. and, you know, that's on me. i mean, we fumbled the rollout on this health care law. >> and that fumble is what the
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administration is going to spend the next several months trying to recover from. not clear whether the fix is going to change anything because important to remember, bill and maria, it does not compel state insurance commissioners or companies to do anything. it just says they can do it if they want to. and a lot of them don't want to. >> you were tweeting, john, that a lot of them were saying this is a joke. that word was used. right? >> reporter: yes. an industry source i talked to said this is a joke because all it does is try to point the finger of blame away from obama care toward the companies by saying, well, the companies can extend them if they want to. their argument is, because of the changes in insurance regulation under obama care, we don't want to and it doesn't make any sense for us to extend them. because we're moving into the new world of the new kinds of policies. so this has opened up a breach between those two. the administration made it as a part of their strategy to try to work closely with the tri. because of this political backlash, they've now split.
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>> john, thank you. the president's announcement left a lot of unanswered questions. including if insurance companies can put the tooth paste back in the tube on those canceled insurance plans. >> joining us now to talk about it, howard dean, former governor of vermont, of course. cnbc contributor now. also stan hutfeld is a former ce,of integress health, a hospital company. good to see you both. stan, let me start with you. broadly speaking, is it possible for insurance companies to extend these policies that they've already sent cancellation notices out on? >> well, certainly it's possible. the logistic of doing it with just a few days left in the policy year, of course, are extremely difficult. i'm no big fan of health insurance companies. but the fact is, we put them almost in an untenable position. it strikes me to continue the football analogy that this is sort of a hail mary pass at the very end to do what i think the insurance companies are complaining of. that's shift the blame and make them the culprits. there's a whole issue -- >> are they dumping it on the
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insurance companies now? >> i don't really feel like that. >> well, is this a good fix? >> not particularly. look, we actually had the same company that got this federal website in all this trouble in vermont. what our governor did, which i thought was really smart. he recognized the problem early. he knew it wasn't going to get fixed any time soon. what they've done is, one, cooperate with the insurance industry. they're not giving the insurance industry more time to sell policies that aren't very good. those policies that are getting discontinued mostly aren't good insurance policies. what they are doing is going right to the insurance companies and helping them sign people up. that's what we should be doing. and the other thing we ought to do, if the website's down, i get that. a lot of tech rollouts don't go well the first time around. use toll-free lines and paper and pencil and get these people signed up. that can be done and should be done. >> how come it's not being done. that's so obvious. >> i don't know why. i think it's a volume problem more than anything else. it's got to be done. >> howard, politically, has this -- is this going to work for the president? i mean -- >> no. >> -- he had a number of
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democrats in the house who were -- and they're meeting today, as a matter of fact. they were going to tell him, you know, we need something. because they face re-election next year at this time. they can't go back to their constituents and say they're in favor of all of this without some sort of a fix. >> i think the whole thing, this is a washington dialogue. this is terrified politicians that are all worried about re-election. the best way to guarantee democrats they're going to get re-elected is to make this thing work. they've got till about march or april to do that. i believe when obama care is in effect, people really are going to be satisfied with it and happy with it. i do. it wasn't my idea of how to do this. but it can work. and it could work. and it should work. but you're going to have to abandon the website. not entirely. we did fine as a country before we had the internet. we need to go back to the basics. >> all we've done is bring adverse election front and forward. under the new plan where people have the option, if they do take
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that option, do we have the old and sick choosing the affordable care act credentials and the young and healthy keeping the old plan? we've made it even more striking in terms of the possibility of adverse selection and making prices for the insurance companies even more difficult. >> are they even going to be able to implement it in 30 days? >> no. >> i don't see any way they could implement it thoroughly with any kind of comprehensiveness. >> in fact, we talked to the national association of insurance commissioners. a lot of the industry is trying to still figure this thing out. this has sort of caught them blind sided here. the statement from the naic is that this decision continues different rules for different policies and threatens to undermine the new market and may lead to higher premiums and market disruptions. >> look -- >> people are still behind the eight ball. >> that's exaggeration. this is -- you know, we didn't need an individual mandate. the insurance company likes that idea. we didn't. suppose 10 million kids don't sign up. they're frankly going to contribute so little to this it's not -- i don't believe it's
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going to have a structural, ak warl, bad effect on insurance companies. the problem is people thought this was going to be in effect on january 1st and it's not. do what you're supposed to do. get the old fashioned ways of doing this. put in call centers. put in paper and pencil. get people signed up. that's what we should focus on. >> go ahead, stan. >> well, the real intellectual underpinnings of this is you'll have two classes of people. those that choose the old plan and those that -- >> for a year, that's true. >> it's an untenable -- so it's sort of like the debt ceiling argument. let's do it a year. then let's be back here a year from now. >> no. >> making the exact same argument. it makes absolutely no sense. >> we're just going to extend a broken system for an extra year. >> you hope. >> i think it's a bad idea. i don't think we need to do it. >> is this bill clinton who moved obama's hand on this? >> i have no where had what the political calculus was. >> president clinton said this this week. >> he did. he did say that. i can't tell you if they're connected or not. >> i think it's more the vote they faced in the house tomorrow
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that moved his hand on this one. >> the house is irrelevant. upton's bill is just more republican obstructionism. it doesn't mean anything. nobody's going to pay it any attention. >> howard, these guys were going to be put on the record as having voted against the president in this particular case. they didn't want to have to do that. >> right. this is all washington politics, though. i'm looking at the structural changes in the insurance market. i think we can still do this. i don't like the idea of delaying it. i think we can make a lot of progress, paper, pencil and call lines. and i think we can still make this thing work. >> we'll see. >> howard, good to talk with you. thank you so much, stan. gentlemen, thanks zblmpk sthank 15 minutes before the closing bell sounds for the day. a market in record territory. >> it is 40 days until christmas. if you're hoping for a santa claus rally for the holidays, your wish may come true. at the nasdaq, at least. we'll tell you why coming up. after the bell, we'll tell you about what could be one of the biggest sellers for christmas. the new playstation 4.
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the nasdaq marching steadily toward 4,000. >> why history indicates that march will continue. right, sheila? >> hey there, guys. talking about nasdaq 4,000, we are now just 25 points away from that level. a fresh 13 year high for the nasdaq composite. this is despite the fact we had the big loss from cisco today. things really on a roll here at the tech heavy index. if history repeats itself, that role could continue especially at tend of the year. we're talking about the santa claus rally. the propensity for stocks to trade higher at the end of the year. santa has historically been nice to the nasdaq. since 1980 the nasdaq posted a 1.6% gain during the santa claus rally and positive 77% of the time. last year santa was especially nice at the nasdaq. in fact, we saw a 3% pop during
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the end of the year. so a lot of momentum here at the nasdaq. speaking of momentum, want to talk about a little bit of the movement we are seeing in momentum stocks today. naks like priceline, facebook, baidu, all those stocks are higher on the day. traders are telling me, look, that's a good sign. these are the same high beta tech momentum names that drove the nasdaq higher. so the fact that we are continuing to see new momentum in them today could be a good sign. until then, 25 points away from nasdaq 4,000, we're on 4k watch here. >> sheila, thanks very much. what a market. really on fire. we've just got about ten minutes before the closing bell sounds. we're in record territory. art cashin did just stop by, bill, and tell me it's about $150 million for sale. relatively speaking that's a small number. does not seem to be a factor at all. looks like we have that record today. >> have this late rally like we've had lately here. we're just continuing to incrementally go higher. when we come back, dan brew remains very bullish on this market. in fact, he doesn't think a pullback in the short term is even possible.
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welcome back. we're in the final ten minutes of trading. dow jones industrial average is in record territory again. so is the s&p 500. up 52 points right now, bill. even though there is an imbalance to the sell side. not a big factor. it's a small number. >> so far. joining us on the floor, sandy vilerry. dan veru. it's been a while. you don't see a correction any time soon. why? >> i just think there's too much cash on the sidelines at this point, bill. a lot of the money that's come out of bond funds is really just sitting in cash right now waiting for the market to correct. i just don't see we're going to see it before sometime perhaps next year. >> did you learn anything today from janet yellen? i mean, we realize there were no surprises. but what does this mean for your investment strategy, sandy? >> yeah. i think interest rates are going to stay low for a long time. now you've got oil that's gone from $110 to $79.5.
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>> even though valuations have come up? >> i think stock picking is going to be extremely important. that's basically what i'm focused on. i think the market is going to be flat looking out to 2014. stock picking is going to be very critical. >> i know we look at valuations and say, gee, we're not overvalued. this is not a bubble. the quantitative easing the fed policy has essentially done is it takes out the normal ebb and flow of this market where we get a push higher if we're in a bull market. then a correction. then another push higher. because that's how supply and demand works. we've taken -- we've suspended that, dan very. how is this not a bubble if we aren't seeing the normal give and take in a market cycle? >> because they're telling you that they are going to take the liquidity away when the economic statistics and numbers point to that. we think that that's a 2014 event. but i think it's going to be rooted in sound growth in our economy. and i think you're seeing that from the dramatic outperformance of small cap stocks.
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remember, those are a measure of domestic opportunities in the u.s. and i think the differential that you're seeing between russell returns and the s&p bode well for expanding growth in 2014 and beyond. >> sandy, dan, good to have you on the program. >> thanks, guys. >> appreciate it. thank you. we'll take a break here with the dow continuing to move higher. have the closing countdown in just a moment with the dow up 50 points. think the fed has fueled this record rally? think again. that's what a brand-new study says. a study that actually spent money on says the fed's easy money hassed that no effect on the stock market. really? >> yeah, right. >> this you have to hear later on on "closing bell." back in a moment. opportunities aren't always obvious. sometimes they just drop in. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities. cme group: how the world advances.
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with the mobile trader app. from td ameritrade. okay. two minutes left here. very quickly, this was the kind of day we had. with janet yellen testifying. in fact, they released her testimony last night. interest rates started to drop immediately. remember, the dow -- the 10 year yield was up to 2.75 for a time. got to 2.78. then it fell. today we're at 2.70. they're taking to heart that maybe we won't see tapering any time soon. the dow continues higher. it and the s&p in record territory. despite the disappointing earnings from cisco last night, which itself down 10% right now, was down 14% earlier. ben willis of albert freed, if you get a bad earnings report from an important company like
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cisco, ordinarily that would have an impact on the whole market. but it completely ignores that kind of a report today. >> well, looks like janet yellen is going to be taking the place of ben bernanke whenever she speaks, it'll move the market. interestingly enough, she made it very clear that the risk matrix that the fed looks at, they're not seeing any worrisome inflation or bubble effect in the equity markets. that was our stamp to go ahead. >> what would be the headwind that would stop this rally? what do you think? >> well, there's not much of a headwind in this market, oddly enough. the market is tired by a lot of technical indicators. we've lost some momentum as we go into these record highs. the money continues to seem to be rotating in traditionally some more -- higher beta issues. some of the material stocks and some of the purer industrial plays, which tells you they believe the economy is going to improve. particularly on a basic level. so the concern for professional traders is it just seems tired. but if you tried to short this market, you got hurt pretty
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good. >> we've been hitting singles a lot lately. thanks very much. dow, s&p both positive. enough for record highs. the nasdaq makes it ever closer to the 4,000 level. that's it for the first hour of the "closing bell." stick around. more on the second hour of "closing bell" with maria bartiromo. i'll see you tomorrow. it's 4:00 on wall street. do you know where your money is? hi, everybody. welcome back to the "closing bell." i'm maria bartiromo on the floor of the new york stock exchange. dow and s&p 500 closing at yet another record high tonight. unchartered territory for this market. on the street today, post janet yellen's confirmation hearing commentary, dow industrial average up 55 points at the close. 15,876. all time closing high for the blue chip average. nasdaq picked up seven


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