the fed could be saying, releasing their minutes, but at the same time, fed president evans said he's got to see 200,000 jobs a month for six months. well, when is that going to happen? no time soon. and i think what the market really said today, hey, more of the same. we're going to have more money. forget what the minutes say. we're still going to see easing for a long time. >> all right, everybody, thanks so much. appreciate your time today. we're in the final stretch of trading here. we had a high of 152 points on the dow jones industrial average. we're still in the triple digits in record territory, but up 129 on the dow, bill? >> question being asked today, how in the world could the fed have accidentally released those minutes from the latest meeting a day early. and did anybody profit from that? former fed governor randle kroezier is with us. we'll get his thoughts on fed policy going forward as well. >>> also, the stock market and the real estate market, how can both go higher at the same time? billionaire investor sam zell will tell us where he's putting his money to work ri

and complaints from people saying, how can the fed say there no inflation? the big wild things are not in the personal consumption. >> the first thing i want to say is that when the fed thinks inflation and underlying inflationary pressures in the economy, we don't just monitor one single index and blind ourselves to what is going on with the others. we routinely look to become -- at the consumer price index, and a variety of other indices. -- of inflation that try to give a good sense of what the underlying inflationary pressures are on the economy. we defined our longer run objective to be concrete in terms of the pce, we by no means focus solely on one number and not look -- we look at a whole variety of indices. overecond thing is that most periods, all of these indices tell the same story. and they give roughly the same signals about what inflationary pressures are in the economy. the cbi that you focus on most of the time and the pce index really move together very closely. the cpi is produced by the labor department. it is the best known index. the pc

it's something the fed chief warned about earlier this year. you talk about the unemployment rate dropping. it dropped because 496,000 people dropped out of the labor force. the participation rate now the lowest since 1969. >> let's be careful about the unemployment rate. it measures a moving target. it measures those people who are participating in the labor force. it's a smaller percentage, but it's measuring a smaller overall number of people. >> that right there is the participation rate, the people in it. a few bright spots. professional business services added jobs, so did health care. >> which we always do. >> but we saw losses in retail. they're discussing whether you have seen the expiration of the pay roll tax holiday that didn't have an affect, maybe it was starting to bite, and that could be reflected in the retail jobs or maybe there's some reason, sequester talk, all kinds of things happening in the economy, europe, that people are feeling less confident and that's translating into fewer retail jobs. there's something called the u

and the fed is helping us. i think it was jim cramer said -- >> ron, how do you allocate capital, then, right now? i know you like the dividend payers. they've been working. where are the areas we should be exposed to? >> they've been working very well. we're starting to move money from the people who are paying the dividends to the people who are trying to. apple's trying very hard to pay a dividend efficiently. that is without paying 35% tax up in front of it. i think you mentioned on the lead in, if you're looking at a five-year horizon we love all the things that will benefit from cheap natural gas. >> what about you, michael? where would you put money to work right now if you don't think we're going to get a meaningful correction in may like we did last year? >> it's interesting. maria's right, there's been no correction. behaviorally that which leads in corrections have led. defensive sectors, bond yields have fallen. this strange disconnect -- >> we just highlighted utilities at a five-year high. >> cons

fed. so in terms of allocating capital today, how would you do it? >> well, we're looking strongly at u.s. industrials, especially in what we call the ema energy, manufacturing, and agriculture sectors. and also, we strongly believe that every portfolio ought to have 5% to 10% in gold, especially gold mining stocks -- >> i would have lost my money if -- >> yes, but you've got to look at it as a hedge. today it did fine, or it was earlier today. it does, it's a hedge against all the things north korea, all the things you've been talking about daily. >> maria, i would like to jump in here real quick, if i can. >> yes, please? >> it's fascinating to me that we're seeing increased volatility, the market got bit up again from the lows today. but we're seeing now these shock waves and we're ultimately seeing the same thing play out that we've seen in the last three years. we've seen an incredible start to the year, the first three months, i come on the show, you know, everybody gets all bullish,

you can give credit to the fed read the fed don't shoot expanded, so goes equities. they have done beautifully, you can see the numbers pretty much the yellow one just a ballooning and equities doing just as well. am i moving money by simply being at least treasuries at this point? >> yes, quite frankly. liz: people, listen to what he says. he is not a bond hater. >> if you sit on the treasury curve at this point in time, it is a terrible mistake. would you want to do is substitute specific bond picking for the bond market itself. liz: which brings me to the bond fund. all allocated, 10.8% versus the benchmark from which they judge you. you have canadian bonds and intel bonds. >> you are talking my business, yes. what you do have to do, what you do have to do is substitute the specific item selection. we're in a period of time rising interest rates are far more likely to go up than down. it could continue perhaps for another 20 years, none of us know. we are laying the base for that sort of thing. you have mentioned many times, sis what happens with the expansion of

economy if the fed stops printing now? >> you're facilitating that debt by continuing to print that money and to keep interest rates artificially low. paul volcker knew better than this. he would not monetize the debt in the way we are doing now. >> paul volcker faced a very different problem. and they're actually using these low rates to deleverage. households continue to pay down debt. and that's exactly what they needed to do. and they're reaching levels that look a lot healthier. so, it looks to me like, you know, the u.s. economy is the shining star of the globe right now. and i think that's in large part thanks not qe policy. >> rick santelli, i know you want to get in on this. and you haven't exactly been shy about retiring the fed policy. what do you think? >> i think it's a shame. i think our first guest has it. she has it right. it's either do it the wrong way or experience pain and do it the right way. and nobody wants to experience pain. but the problem is, maria, that your comment is right, but it's wrong. bec

>> the fed will stop when the markets tell the fed to stop. i don't think they will ever declare victory. we have done enough and we will go away now. they keep going until the markets say enough, please stop. >> jim, i got to ask, it's not like the ten year treasuries at 4%. we still have a lot of buyers. people are still afraid of something. >> the fed is buying treasuries. the fed is the big player. >> yes, but they're not the only buyer. >> bill gross has treasury exposures. >> he just started. but the fact of the matter is the buyer on the margin is the fed. they're setting the price. they're buying $40 billion a month of treasuries. do we think that the treasury and the stock market would have a huge reaction? of course it would. yes there might be money coming in from europe. you're not going to get that giant rise in yields. >> we have got to leave it there. more coming out of jamie diamond's annual share to holders. >> that's right. always a dense and meaty document. it's interesting to note that jamie diamond in his letter says that

it's expected the fed will keep borrowing costs low, but a bigger question seems to be whether the fed will keep pumping more money into the economy through its bond-buying program. meanwhile, the parlor game has started in washington and on wall street over whether fed chief ben bernanke will stay for another term, and if not who might replace him. our next guest is the author of "the alchemist: three central bankers and a world on fire clotfire ." welcome. >> the economy is not growing very fast. the march jobs number was terrible. yet i don't see virtually anyone who thinks that the fed is likely to expand its bond buying program to stimulate the economy. you're in that camp. why not? >> yeah, they've been doing $85 billion in bond purchases every month, trying to pump money into the economy, keep mortgage rates low. and they're going to stay the course on that. if you remember just a few weeks ago after that last meeting, some of the officials were talking about tapering off the purchases. i think the bad data has been enough in to end that talk of tapering. but at the same time th

the rich already know they are roiled fed. i don't know what point the rich are finally paying a fair share but they're not there yet. they're not even close. mr. president, what will it be to let rich folks be? if not a combined top rate of 50% now, what will it take? 60%? 70%. back to the good ol' days of 90%? hard to say this much is not. you say you don't want to fix our spending problem on the backs of the middle class. so you clearly decided to keep hitting up the rich and kick them in the ass. at least while you still have them because at the rate you're going, mr. president, you won't for long. none of this is surprise to hear house speaker john boehner tell it, reacted this way. >> he does deserve some credit for some incremental entitlement reforms. they outlined in his budget but i would hope that he would not hold who stands these modest reforms for his demand for bigger tax hikes. neil: somewhere boehner has to cobble together or somehow, some sort of a deal with the president who simply won't budge on those taxes

bonds have still been okay, because of the fed. so the incremental fed tightening, even if it's a slowdown in the purchase rate of government securities, may mean bond buyers or bond owners start moving out of bonds for an allocation perspective and drive equity markets even higher. that could possibly happen. >> dean, how do you see it? >> economic growth is a double-edged sword for the fed. this is the perfect storm where we have mixed economic results, decent news, but not overwhelmingly good. because anything really, really good might force the fed to stop this ultra-accommodative policy. so i agree with rick. we're not going to see a stop to the fed's actions. >> and let me just make one looking ahead point here. tomorrow morning, we get retail sales for march. this is a very important report. we've seen a lot of supply side indicators like the manufacturing and the employment numbers disappoint for the month of march. you might be able to blame that on an early easter. harder to make that case if we get lousy retail sales. if

nothing the fed has to do. for the fed, it's steady as she goes. you have the fed governors come out and talk the talk. bottom line is they haven't done anything new. everything's come from japan, their massive stimulus. >> i don't necessarily agree with you. i think one of the things affects the market is policy. the other pig thing that's happened is wall streetms to firmly believe now that qe will continue into 2014. we asked that question for the first time. and the average amount of qe expected in 2014 is now $370 billion. the stopping of qe doesn't happen until july. that number can move or that date can move back and forth dough pending onhe outlook for the unemployment rate and other economic figures. but that seems to be where the market is right now. >> if that's the truth then, if that bears out to be true, what the respondents to steve's survey say, then sell in may doesn't necessarily have to happen. >> no. >> why would it happen? >> sell in may doesn't have to happen. and i think the street is correctly looking to steve's point at the

i still think the fed is full steam ahead, but about a better forecast among some fed members. you have to be on your toes on the trade here. >> certainly, steve. thank you so much. it seems today people are taking a view that the fed is not going anywhere. because i should point out that the dow has crossed 14,800. so we are not that far away from dow 15,000. before we talk about that, let's go to aimen jabbers, when it comes to high freerktcy trading, every second counts. we are live in new jersey where cme and nasdaq are partners to move down transition exchanges. this affects all the investors watching our show. >> reporter: that's right. albert einstein said the speed of light is the faster speed, but we have got on the the point where the speed of light as it transfers over a fiberoptic cable is not fast enough for high freerktcy traders. that's why nasdaq and the cme partnered to build a series of towers across the country connecting markets in new jersey with those in chicago and the tower you see here behind me, a 128-foot tall bohemuth from the top you can see the man

inflation is still quite contained in the 2% target that the fed is aiming for. that said, they have to be vigilant. the successor, depending upon whether he retires or steps down ten months from now, that is going to be job number one. >> host: do you think that in general our economy, the european economies, how it to japan in a minute, relied too much of a central bank and not enough on other weapons and economic policy? >> guest: absolutely. the last two years is as damaging the degree to which the central banks have been the only game in town in dealing with what else the world economy. you know, i don't think that the reserve -- they have been doing different forms of easing and defense strategies. we were not comfortable with that. there would love to see a world in which the fiscal authorities are pumping money to the economy and they can be the ones ready to apply the brakes if we start missing in place are getting into a dangerous situation. that is there natural stance. central bankers don't go into that line of work because their activists and want to

and we're hearing all this fed speak. are there dangers, downside risks to all of this free money years out? >> the obvious answer is it creates inflation. i'm not as worried about creating tremendous inflation in the system. i think there are a series of reasons. commodity prices are coming down over the long cycle. i'm not that worried about inflation. it will pick up -- you know, you're starting to see a bit of velocity because the banks are lending. the thing that i worry about is you're creating excess. people chasing for investments, people starting to put leverage on investments now, because you have to chase yield. you have to chase return. pension funds and insurance companies trying to match your liability stream. you've got to take more risks to try and do it. and i worry the longer this goes on, you're creating that extreme that i would argue is not necessarily necessary at this point. >> but there are many alternatives with rates where they are. >> and that's part of the problem. and i describe it a lot, as y

we went to the fed to say, are you guys putting -- twisting arms here? the fed declined to comment. back to you, michelle. >> thank you so much, john. and one company all too familiar with the fed's requirements, bb&t. the lender got a rejection from the federal reserve on some parts of its capital plan following the last round of stress tests back in march. >> and then today, bb&t stock is under pressure on the heels of its first quarter earnings, as net income took a hit, due to a charge tied to a disputed tax liability, which the bank warned us was coming. joining us right now, we're pleased to welcome in a cnbc exclusive, ceo and chairman kelly king. mr. king, welcome back to you. >> thank you, glad to be with you. >> before we get to the earnings results, let's get to the reaction on john's reports on capital requirements. obviously, debt got to be such a problem before the capital crisis, there was too much debt everywhere in the economy. are we going the opposite direction? are the capital requirements too onerous on banks right now, in juni your view? >> well, i think the pr

the fed is going thereby. >> the fed's already there. but isn't the bottom line also that when the individual investor starts to become bullish, we start to see flows into the market. >> do you think we're there already? >> we're starting to already see that. don't you think that's really, actually, the start of maybe a bit of euphoria capturing the this market. and the first guest talked about -- the second guest talked about that the market was fairly valued. well, fairly valued is not a discount. i mean, if you're playing a momentum market because of the fed, the fed's not going to be here forever. when the fed goes away -- >> when are they going to go away? let's face it -- >> that's why we're up 10% right now, maria. >> exactly. how much more -- >> how far can the patient run who's dead on adrenaline. yeah, he'll run far -- >> jim moffett, jump in here. how are you allocating capital right here? >> i'm sorry, what? >> how are you allocate ing capital here? >> well, as a firm, we like the united states. we still think that's driving

no way the fed is slowing down. and in a sense, in a -- in a sense, that's easier money. >> it is easier money. one of the trickier things that's going to happen next month with increase in tax receipts and is a cut in spending, the government actually has to issue less debt. and that's going to make the fed have to be a little more -- >> by ten minutes. because it's coming back in the third quarter. trust me. >> i agree. but in the next couple of months, you're going to have less supply, they're going to feel more aggressive with what they're buying. we'll see what that does to the ten-year. i think there are a lot of people waiting to see how that plays out. >> speed of the bond market. apple. talk to me about apple. >> it is amazing, isn't it, that the company with that much money actually has to issue debt? it's an environment where you can, right. obviously, a great rating so they can get it easy. it's the largest debt deal in u.s. history, and yet they were able to do it overnight. wasn't a lot of heavy liftin

and when you start to look at the fed, where the fed was in 2004, versus where we are today, when you look at credit spreads and where they were in 2004 on high yield corporate bonds and where we are today, it really looks very similar. >> where was the fed in 2004? still easy policy? >> the fed had just started thinking about reversing policy. now we're nowhere near that at this point. so i think if you look at 2004 as a model and you say, what happened between 2004 and seven, which is we saw the beginning of an asset bubble, we started to -- we continued to see equities move on about 30% to 35% for the next three years. you know, we saw credit spreads continue to tighten because of the easy policy. if you recall what had happened there, greenspan had attempted to take back liquidity in a very measured way. five years later people were criticizing him for following behind the curve, we had too much liquidity in the system and that caused a housing bubble. you know, as mark twain said, history doesn't repeat itself. it just rhymes. >> do you think they will have a hard time getting ou

it's rigged to is that what the banks do all the money the fed pulls until. they buy stock futures how can you have a stock market. all time. where consumer becomes flattening when the labor force just station right is collapsing because there's no jobs with retail sales or the cloudy or the what is the basis for this market and we've had these amazing collapses we had one the beginning of the century we had a lot of weight and there's a lot of no pity it's just a question of what sets it all alright well we're going to leave it there dr paul craig roberts thanks so much for being on the kaiser report. maybe max all right and that's going to do it for this edition of the kaiser report with me max kaiser and stacey herbert my guest paul craig roberts his web site is paul craig roberts dot org if you'd like to send us an e-mail please do so at kaiser reported r t t v dot argue until next time nice guys are saying buy off. a clear image of iraq to. twenty day taxi trip through the country. the roads. clear evidence from north to south. the roots of iraqi tragedy

it's rigged to is that what the banks do all the money that the fed funnels until. they're buy stock futures look how can you have a stock market an all time high. when considering becomes a plotting when the labor force participation rate is collapsing because there's no jobs when retail sales are the cloudy or that what is the basis for this market and we've had these amazing collapse that you know we had the one of the beginning of this century we had a lot of the oh wait and there's one now pending it's just a question what sets it all right well we're going to leave it there dr paul craig roberts thanks so much survey out on the report at least maybe the max. all right and that's going to do it for this edition of the kaiser report with me max geyser and stacy herbert my guest paul craig roberts his website is paul craig roberts dot org if you'd like to send us an e-mail please do so at kaiser reported r t t v dot are you. sick to multiply here. it's very profitable to invest in colombia we did a very profitable is a very high return on investment. but i've bee

the fed has played a key role. it's not enough. and i think mohammed makes a good point about the fact that the fed is preventing us from slipping into another recession. we have yet to reach velocity. >> you're still optimistic. are you? >> a little less and i'll explain why. the dynamics of the economy is every month we don't see rapid growth, it it makes it it harder. why? a couple of reasons. one, the international environment is getting trickier. it's getting more challenge iin. so the head winds we face coming from outside are very large. secondly, fundamentally we are structurally impaired. you use the example of a hospital. we came out of the hospital, but we are structurally impaired so we cannot run. and every month we delay in dealing with a structural impairment means we cannot run as fast. and i worry about that because of youth unemployment, income distribution. so i am more cautious than diane. >> what's your sense of how we fix this going forward? >> i think we are poised to have a good growth year or two provided t

i want the fed in the back growth fund. i'm putting the fed in the background. the congressional staffers put it in the background and now i've got it and i'm focused on the ten times earnings stocks. china is not falling apart. >> all right. so there may be some sort of a shift from let's call it really safe money into the cyclicals. >> yes. that is the gold call by goldman. they're saying short gold. i always love short gold. gold is what you buy when you think things are not that certain. goldman is saying things are much more certain. it's kind of a gutsy call, but it would explain why you would want to rotate into clemens. alcoa did say that china was on course. the trucks that use a huge amount of aluminum did talk about the aerospace numbers. alcoa gave you the green light to buy everything other than an alcoa. you saw the cyclicals start with that. and then you got the chinese number despite what 60 minutes says about open housing and then you get the number that they're importing. i say good-bye to cyclicals. >> right here. right now. all right. >> the

accidentally released minutes which signaled a major change of policy the minute suggest the fed may possibly wind down quantitative easing what do you think of this dr roberts i don't see how they can do it because if they do unwind it. what happened when france is the one with a one trillion dollar federal budget deficit and if they do one wind it what supports the bond crisis one whole reason for quantitative easing is to drive up the prices of the debt related to root it was all the banks too big to fail books and so they're trapped if they if they stop quantitative easing and they're not supporting bond prices that interest rates will rot us and the the shall see the banks worsen will cause the prices of their assets in the bank's books world class. course if interest rates rose and the bond market collapses stuck organ collapses so i don't believe we're on what. qualitative easing i don't know how they'll get out of it now i'm not exactly clear on the dates but were you in the reagan administration during the plaza accord because i believe that was the last time international c

., and that's the fed. and i don't see the fed going anywhere anytime soon and i still see cheap money. no, this is not the beginning of a collapse or the beginning of a correction. absolutely not. >> look, we heard reports earlier. we heard from the official at the san francisco federal reserve, the suggestion that we are actually going to see the federal reserve ending the buying of treasuries and bonds at the end of this year, possibly as soon as the summer. >> maria, you're right. and that would be great. it would say, gee, we've finally gotten our big boy pants on. >> it's not going to be great for equities. >> a great win overall. >> what do you mean -- >> at some point, we're going to have to take our medicine, maria. that's the only way we'll be able to do it. finally getting the fed to take its foot off the throat of this market, a free market. not the artificial market. >> i don't disagree with that. i'm just saying, is the market really prepared for that? yes, you're right, it's totally manipulat

all of them are set by the fed. all of the fast money traders are trading against the fed. we are in a mother of all bond crisis. connell: eventually, a big bubble burst and we all come crashing down. is he crazy? dad on? somewhere in between? charles: i do not disagree that on a day to day basis that trading can under inflate or over and play. my problem is they have existed for a long time. no one is in the market because you scared the hell out of them. what is your game plan? if you keep scaring people, you have to take the responsibility on the other end. if that feller, these same great companies, their stocks may go down. where is the responsibility aspect of it? connell: when it first, there will be no new round of bailouts like the ones thinks that in 2008. instead, america will decide into an era of zero-sum austerity and virulent political conflict, establishing even today's feeble remnants of economic growth. charles: if i am reading him clearly, we should take the pain when the pain comes. we should not dedicated. every landing has to be a soft landing. there i

it's rigged to is that what the banks do all the money that the fed funnels until. stock futures look how can you have a stock market at all time high. when considering becomes a cloudy when the labor force participation rate is collapsing because there's no jobs when retail sales are the cloudy or that what is the basis for this market and we've had these amazing collapses you know we had the one the beginning of this century we had a lot of the overweight and there's one now pending it's just a question what sets it off all right well we're going to leave it there dr paul craig roberts thanks so much survey out on the casa report lisa's baby max. all right and that's going to do it for this edition of the kaiser report with me max geyser and stacy herbert my guest paul craig roberts his website is paul craig roberts dot org if you'd like to send us an e-mail please do so at kaiser reported r t t v dot argue until next time nice guys are saying buy a. victim's multiply here. it's very profitable to invest in colombia we did a very profitable the it is a very high r

because the fed has... >> jon: 0%. they're floating them >> the fed on its foot on the neck of millions of slavers in america today. you get half a percent if you have a savings account. the deposits cost nothing. they go out and they buy... >> jon: our economy is flipped in that they now value the investment class over work. investment now is... i mean that's been 40 years, capital gains the whole thing. we have to take a break. we're going to discuss page by page the great deformation. it's on the book shelves now. you stick around and we'll talk a little... >> can we get to chapter 2 then. jon: believe me. this is no big fun. ÑÑÑÑÑÑÑ

the fed? >> i will answer first. there is an answer that is laid out in great detail in my book. go back to the vision of the founders. carter glass is the greatest financial statesman to serve in the last century. he was the author of the federal reserve. his version was a bankers' bank. they did not have an open-market committee. -- y were not followed by allowed to buy government debt. they could not manage or micromanage the interest rate paid at a heavy discount window. if real banks who were member needed cash, they could bring good collateral, cut inventory loans, receivable loans to the window, have them examined, and if it was good quality, they could get a loan, with a penalty interest rate above the market rate, and a market rate was set by the free market of savers in the various banking markets of the country. that is all we needed. that keeps the banking system liquid. that allows the free enterprise economy to drive how much money we need him how much liquidity we need. we did n

when we return, one of the biggest areas that the fed weighs in on the fed's early send error. several pubically held companies have done it. you hit send before you. the new face of detroit michigan after the break. ♪ [ laughter ] ♪ [ female announcer ] each one of us is our own boss. ♪ and no matter where you are in life, ask your financial professional how lincoln financial can help you take charge of your future. ♪ can help you take charge of your future. are you still sleeping? just wanted to check and make sure that we were on schedule. the first technology of its kind... mom and dad, i have great news. is now providing answers families need. siemens. answers. welcnew york state, where cutting taxes for families and businesses is our business. we've reduced taxes and lowered costs to save businesses more than two billion dollars to grow jobs, cut middle class income taxes to the lowest rate in sixty years, and we're creating tax free zones for business startups. the new new york is working creating tens of thousands of new businesses, and we're just getting starte

the fed still protects them it's still a protection racket your thoughts well that's right but critics run the fair don't when they run the treasury is to save executors who calls the financial crisis the run the treasury ruggieri says and in the stroke course their parent or dr roberts just prior to the smashing gold prices by naked short selling illegal short selling the fed accidentally released minutes which signaled a major change of policy the minutes suggest the fed may possibly wind down quantitative easing what do you think of this dr roberts i don't see how they can do it. because if they do and why do. what happened what finances the one and one trillion dollar federal budget deficit and if they do one why do what supports the bond crisis the whole reason for quantitative easing is to drive up the prices of the debt related to root it was all the banks too big to fail books and so they're trapped if they if they stop quantitative easing and they're not supporting bond prices that interest rates will rise and the the solid the banks will worsen will cause the prices of the as

dennis: is the fed inflating a new housing bubble? ed joins us melissa and lori on his warning call in today's "wall street journal." that's in the next hour of markets now. cheryl: the fed minutes. released early, it was a mistake. the market didn't seem to mind. some people are probably trading on it right now. we'll see what else helped us reach the intra day highs. cheryl: medical marijuana clinics are ahead. why banks won't take his legally earned money. cheryl: on the s&p 500 now, big names are making big moves. micron, apollo and more. new intra day high for the s&p 500 today. all stations come over to mission a for a final go. this is for real this time. step seven point two one two. rify and lock. command is locked. five seconds. three, two, one. standing by for capture. the most innovative software on the planet... dragon is captured. is connecting today's leading companies to places beyond it. siemens. answers. >> announcer: you never know when, but thieves can steal your identity and turn your life upside down. >> hi. >> h

there's a phrase on wall street, don't fight the fed, and the fed, clark, the fed itself has told us that they're going to keep rates low as long as they need to, until the job market improves. so that would suggest to me you've got a stock market where the path to least resistance is higher. >> as long as corporate earnings are strong, to this point, corporate earnings have continued to be very healthy, and barring a severe u-turn really in the economy, there really is a clear path to corporate america continuing to report good earnings, and in turn, that would support the stock prices. >> good earnings, they got a lot of money in the bank, they're not necessarily hiring people with all that money and that's the thing that really confounds the half of america, terry, who aren't in the stock market. recent cnn/orc poll found 55% investing in the stock market was a bad idea. how do you change the attitude toward investing so more americans can take part in wealth building? you look at for example the lottery. you can't win if you don't play. could you say the same thing about the stoc

for more fed officials tomorrow will be speaking in public. joining us now with his perspective, chief economist for moody's economist. anyway we could stop them from talking tomorrow? >> no way. that is their job, and we need to do whatever we can to reduce the unemployment rate. lou: doing pretty much what they can. 85 billion a month in purchases of to get as somewhere. is not getting a city where fast. you think that the fed president would like to have his comments back? a little declaratory. >> forecasting is a dangerous business. in this case there is no way of knowing if the economy will improve so that we can afford to phase out t program. lou: he ignored the less experienced. minutes were misinterpreted initially by the market. yet to come out and say, ts is why we meant to say as he tried said divine our discussion. someone will have too it. >> sometimes silence is golden. lou: unless you are in a particular line of work. we enjoy a folks who helped them along. your view right now, a presells sell-off. 4-1 margin on advancers gettin

that was the fed funds rate. in this case, likely will have fed funds rate rising, might have them reducing the qe operation. the twist operation type deal. but what you're looking at here, we would expect it will be rather well timed, looking for the fed to definitely telegraph it. and then in addition to that, we have some time ahead, we saw with the payroll number on friday, even with the good initial jobless claims today, the environment it's a slow recovery, but it is a recovery. >> in terms of the sectors that you flagged as outperformers in a an environment where rates are steady, versus rates rising, there's a lot of overlap there actually. >> yes, there is. i brought the list with me to read it. it's energy, utilities, materials, telecommunications, and tech. -- i'm sorry. did best when rates were rising. on the other hand, the ones that did the worst were tech, health care, and both consumers. >> all right, so materials and energy to me, this is nonintuitive because you think would that materials are se

not just this fed but three other feds around the world. first time ever, you can't fight four feds. so i think this is the only game in town. i agree with the other guests. they're not going to do much because unemployment is staying, high. i don't think we expect much from the fed and i think people will be exiting bond and cash finally getting into the stock market and that is not necessarily the right thing to do. david: we mentioned the fed, ecb, the european central bank is coming out with their meeting notes and information about what they're plan tock do with their currency on thursday as well. so it's a big week for central banks. larry, focus on a little positive news, japan the "wall street journal" had a piece today about how some gloom and doom in japan is fading away and there's a lot of optimism now. do you believe in japan? >> long-term term i don't believe in japan because i believe the fundamentals behind all this is a lot of smoke and mirrors. what is propelling a lot of this right now is what we call the carry trade. the

how much of this is the unwind of the fed trade fears out there that the fed will start unwinding or tapering back sometime this year. >> they don't have to do anything. >> the expectation has gun on the u.s. side. it is offset by what is happening in japan. japan is . >> before they make up their minds they will be going into cash money is going into australian bonds. it is going into brazil, which is very rich in terms of the yield that it provides you. all of these are benefitting al also. >> we have to leave it there. >> thank you and your divining rod. up next on street signs. the other piece of this sell-off may be the federal reserve. we'll explain why. >> the vix up 25%, trading just over the 15 mark and the markets are continuing to sell off right now. >>> could the fed have something to do with the sell-off. not ended, but wind it down. >> and that survey told us that primary dealers and these are the cream de la creme of wall street. they actually think they will be done sooner. a lot of people think they will be done by the end of this year. what we have learned is that t

so the monkeys is on the fed's back. every other time ben bernanke speaks, you hear him say, guys, help me. fiscal policy, i need you to help. we do need some help there. in the meantime aside from the recent slowdown the economy is irregularly improving. not good enough because we still have deleveraging in the system. neil: you know, i always refer to you guys the experts, brad, a lot people ask me to explain why is our market doing so well, i would say that by comparison we look pretty good. so that is sort of like being the tallest midget in the room. you're still a midget, but you just a tad taller and more appealing than the others. that is hardly ringing endorsement but it is what it is. europe's mess what they are. that's what we face but i don't know how long that kind of thing can last? >> as an investor though i think as you look at other choices as bad as choices may be here i think we're quite a bit taller than the other midgets in the room. neil: two inches, three? >> could be six. >> to add to brad's point

and i think you can't fight the fed in here. and i think with the data we've seen recently, which has been softening and not making a lot of progress in economic growth, i think they're still in place. i think ten-year rates could go down to about 145 from here, which is going to put you close to the 135 handle in futures. so i do think that the trend is continuing and this past week has just been a pause within that. >> joe tanias, if that happens, what happens to stocks? you're looking for bargains right now, aren't you? >> i am laooking for bargains. economic data over the past couple of weeks has been soft and we don't want to sugar coat that, but that's all it is, it's been soft. it's nothing more sinister. we still see economic growth this year to outperform what we saw last year. and in the first quarter, when you saw risk assets rally the amount they've rallied, it's expected you're going to see a bit of a breather. i think what's going on this week is just a lot of digestion. there's also going on around the world and i

the fed? >> i will answer first. there is an answer that is laid out in great detail in my book. go back to the vision of the founders. carter glass is the greatest financial statesman to serve in the last century. he was the author of the federal reserve. his version was a bankers' bank. they did not have an open- market committee. they were not followed by government debt. ory could not manage micromanage the interest rate paid at a heavy discount window. member banks who were needed cash, they could bring good collateral, cut inventory loans, receivable loans to the window, have them examined, and if it was good quality, they could get a loan, with a penalty interest rate above the market rate, and a market rate was set by the free market of savers in the various banking markets of the country. that is all we needed. that keeps the banking system liquid. that allows the free enterprise economy to drive how much money we need him how much liquidity we need. we did not have any central planne

whether the fed's money printing programs just aren't working. we'll reed your responses a little later on this hour. >>> plus the president has released some details of his new budget. not only does it go after upper earnings but savvy investors and perhaps your 401(k). could the government get involved with that? well the president wants to. we'll tell you how. we're live from the white house with details. >>> we're heading back to liz claman live on the raymond james trading floor with some very special guests of liz, who is coming up? >> in fact the, david, the man who called the eightsy seven -- '87 crash correctly and called the market low of 2009 in march is on the trading floor. jeff saut is the chief investment strategist here at raymond james. what he is calling for next. stay tuned we're live never st. petersburg, florida, where they're thinking all things money. stay tuned. we're coming right back with jeff saut. ♪ . [ male announcer ] at his current pace, bob will retire when he's 153, which would be fine if bob were a vampire. but