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tv   Countdown to the Closing Bell  FOX Business  January 30, 2013 3:00pm-4:00pm EST

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it's not rocket science. it's just common sense. from td ameritrade. liz: status quo again at the federal reserve. ben bernanke he's seen walking and talking here, but it's pretty much staying in place, staying the course on monetary policy again. no end to quantitative easing as it's known in the foreseeable future. so time to move on to the friday jobs report perhaps. we're always looking at the next thing here on countdown to the closing bell. good afternoon everybody. i'm liz claman. this is the last hour of trade. arguably the most important hour because it's how the market ends, not how it begins. the fed made it pretty clear to the markets that rates are not going up any time soon. asset purchases that it's been making will continue. but the reaction in stocks, what do we see? a bit of selling pressure in the
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wake of the no decision decision. dow jones industrials down about 23 points at the moment. but when you take it in the bigger picture, trading near five year highs. if the blue chips were to finish the day in the plus column, it would be the 7th day of gains out of the past 8. a nice stringing together, but, you know, yesterday kind of interrupted that. now the dow is just about 1 1/2% from its all-time high. all time closing high, we should stress going back to october 9 of 07. that was as you see on the screen we showed it to you yesterday 14,164.53. every little bit counts; right? and what about what we are seeing in the treasury market here. ten year note yields at 2.0% here -- 2.0% here. some investors believe we could see big allocation shift from fund managers into stocks from bonds, keep in mind we have already started to see that over
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the past weeks, several billions going into mutual stock funds. fireworks continue in the currency market. open season on the dollar. 1.3565 now that's what it takes to buy a euro. looking stronger and stronger each day. the federal reserve holding firm leaving the fund rate at exceptionally low level. peter barnes with the details. they must have known that the gdp had slowed down; right? peter: listen, they are going to continue their -- the quantitative easing, 85 billion a month in bond purchases. keep the fed funds rate at 0 to quarter percent, that's going to continue. we go to the statement for the reasons why. it says quote information received since the last meeting
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in december, quote, suggests that growth in economic activity paused in recent months, in large part of weather-related disruptions and other transitory factors. employment has continued to expand at moderate pace but the unemployment rate remains elevated. as owe know the fed -- as we know the fed wants to keep the foot on the gas pedal here until the unemployment rate gets down to 6 1/2%, as long as inflation doesn't rise. one other thing that economists are looking at here, is the possible disruptions and the costs that could be caused by this 85 billion dollars a month in bond purchases. such as disruptions in the mortgage backed securities market. and other markets. take a listen: >> another potential cost is the possibility of inducing additional asset bubbles. they are going to be carefully looking at that. there are a couple of asset categories already where prices are high, farmland being one example. and they certainly don't want to continue a program that's going to create financial instability.
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peter: liz back to you. liz: one tenth of a percent shrinkage but some of that has to do with government spending dropping. 6.6%, you look at that and you say well that's what happens when you cut government spending. maybe the economy slows down a little bit peter. peter: that's right. a big chunk of that was defense spending and the questions about the fiscal cliff and all these other things that combine to inventory. listen, but the inventory number in the gdp report, there was a shrinkage there that was unexpected. that means that eventually everybody has to increase their inventories; right? so that's good going forward. that means economic activity going forward. liz: silver lining here. listen, i don't have to search hard for it. i don't think it was that bad. it stuns people to see the minus sign and the.1. when you do see the government spending down, defense down 22%.
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consumer looked better, the best since we have seen i guess since q1 of 2012. thanks peter very much. let's get to the floor show and get the real reaction from the traders themselves. new york stock exchange, cme group and the nymex. let's go to john brady at the cme. what reaction did you immediately see? give us the inside scoop, that prism through which you are looking where you said wait a minute this particular reaction is interesting to me. >> liz, earlier in the day, about an hour before the fed came out with their statement, you know, the seven year note was auctioned off right around 1:41 or so, and a bit of a sloppy auction, slightly higher than expected. right on the fed announcement saw that same seven year yield drop immediately to 1.37 1/2 and started to back up a little bit. what you are seeing, the offsets from this, in fixed income land, there are currently two trades, one, move down the credit ladder and try and pick up additional yield or sell volatility.
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that's the trade that came through immediately after the fed. implied volatility here on exchange and treasury and fixed income products was immediately sold with the idea the fed policy is going to continue at least for the immediate future. liz: we showed the ten year yield at 2.01% there, john brady. if we breach that ceiling and we continue to stay there, you see more puts out there in the open market? >> well, i think there's a lot of -- there's a lot of money within the real money domestic industry. large pension funds, asset managers, state pension funds, have a need for yield and duration pick-up. so if ten year treasuries, 2.10 or so, we will probably look to probably better receiving or buying of bonds. the key level for ten year treasuries in the coming weeks and months will be 2.37 1/2. that was the high yield of march from last year. if we get above that, then it is look out, yields will scream higher. liz: doreen, you would have thought if they were looking for yield elsewhere and not the
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treasury market, it would have gone into the equity market, we are not seeing that right now. what are you sensing on the floor when it comes to assets like equity? >> i have to tell you, i'm surprised to see the markets holding up as well as it has been. the gdp number alone should have i think given us much more room to the down side and a lot of technicians are thinking for a pullback after all these days of going up up every day. liz: not from that doreen. this number and i would argue that a minus 1/10 of a percent while scary as it is written on the printed page, when you pick it apart, we just talked about it with peter barnes did not look as bad. this is what happens when you cut government spending. >> yes, but obviously it's not as bad because the market held up very well -- very well. when you combine that when i think do allocations will go back into equities through retail investors alone, inflow in mutual funds through the last month, i think people are feeling things are getting better. liz: i'm looking at natural gas right now, up 2%. quickly on the energy market, what do you see?
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>> quickly, liz, i tell you what, i see the gas market being really strong, natural gas and the gasoline market, those spreads moved out versus crude. above $95 here. i see a slow climb to $100. not out of the question. we are $2 away. i think above $95, you have to stay long. $97, what did we trade just below 98 bucks here. looking at $100 not in the very distant future, in a week or so. you are going to see $100. we are going to have some pressure there. but i think the market wants to go higher -- go higher. keeps drifting to the high end. look at the gasoline market today, inventory numbers, big build in crude and slight draw in gasoline, just with that slight draw. i think you are going to see market trade higher. liz: in gasoline they were expecting a build, they got a draw. that was a surprise. not a surprise to see that move. gentlemen and doreen, thank you very much. >> thank you. >> thank you very much.
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liz: for giving us the real feel of what's going on in the trading floors in response to what ben bernanke and company said or didn't say. while rates remain near 0, again, and quantitative easing still in the works, what is the best way for you to make money? one of the most respected people on the street, jpmorgan chief equity strategist tom lee standing right here in studio. we so appreciate you coming in. >> thanks for having me liz. liz: the gdp number, it put a negative in front of it, to the down side? >> one, we have to remember gdp reports are yesterday's news. because we had fourth quarter numbers coming in as we speak. and what we're seeing is companies, revenue growth accelerated from the third quarter. earnings accelerated. companies are beating numbers. we know payroll throughout the fourth quarter were actually positive. if government spending is negative and we have these kind of private sector numbers, i'm okay with that. liz: you came out with a forecast to the street that said dow 20,000, but in four years. mark a few points on the
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calendar for us. what do we expect mid year this year? four years is a long-term outlook. what can we expect the sort of closer on the street here? >> well, you know, we think we're still in a bull market. it started in 09. so this is the fifth year. fifth years are a little tough in the first half. liz: when does the correction come? >> we think we're maybe four to six weeks away. i think investors shouldn't go to cash yet or get defensive. there's still sort of positive momentum in the market. we don't think enough investors own enough stock, so that's why the market sort of levitates from here. liz: now is not the time to sort of build up because in four to six weeks you expect how much of a correction? >> that's the tougher part. there's an argument that can be made that could be quite shallow, 3, 4 percent which anyone could bear or it could be more severe of the 10 percent kind. i think it depends on how extended we get over the next four to six weeks. liz: are you surprised things settled down in europe, settled down after the fiscal cliff drama at the end of the year and
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the market is still holding up well in light of at least headline news that looks a little frightening? >> yes and no. i think the fact we have had some bad news and the market has taken it in stride is really highlighting how underinvested most investors are. liz: tell us how to get more invested once we're through that correction that you do predict. where would you be putting money? >> well, i think investors should think about housing strengthening, europe turning, china stabilizing, which means you want to buy smokestacks, basic materials, energy, technology stocks, you know, financials, things that are involved as these economies start to recover. liz: let's make that list, basic materials, financials, energy -- >> technology. liz: technology. what would you avoid then? >> i think what you want to avoid which will underperform doesn't mean they will go straight down are things that people have bought for safety. so i think things with steady dividends won't do as well. so utilities, telecom services.
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liz: we had somebody on yesterday saying still go for the dividend players. and payers. >> now if they were, they'd be extraordinarily lucky because in the fifth year of a bull market, it is rare that those sectors actually work. liz: okay, i would see that. your s&p target, once we get through the correction for 2013? >> yes. liz: looking at that, about 50 to 80 points away from that; correct? >> yes, i think sometime before the summer, we will pull back and then 1580 looks like a big move because it is going to represent a double digit gain. liz: i don't know what is going to get us there. what do you think will get us there? >> i think it is possible that investors worry about inflation, as the ten year sort of goes towards 2, 2 1/2, we start to say where is there some level here where losses trigger people getting worried about owning assets? the other could be just economic data doesn't come out as consistent. liz: if you change your forecast, come running and screaming back to fox. we would love to hear your opinion.
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>> sure. liz: thank you very much. >> thanks for having me. liz: tom lee is jpmorgan chief equity strategist here on fox business in studio. the closing bell is about 48 minutes away. this is a question that we have for you. how would you rate the fed's work? well, the stock market clearly over the past two years has given it a thumbs up. we've seen very nice rallies here. with all the liquidity, all the help being injected into the system, but what about main street? is all this money printing, although the fed would argue it's actual printing, but is all this money having a big impact on the real economy? is the fed's quote artificial economy hurting us? well, that's the title that a former dallas fed vice president is giving it in a fox business exclusive. find out why he thinks central bank policy is flawed. what sign posts you need to watch out for for your own money to protect. and wait till you hear what he says about interest rates and when we should be tightening them. sooner rather than later. put on the battle gear, you
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liz: shares of blackberry, yes, they changed the name from rimm
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which used to stand for research in motion, looking very bleak. it's a huge disappointment for the company because they had this highly anticipated product launch of the blackberry 10. let's head to nicole petallides on the floor of the new york stock exchange with more. down nearly 10% right now. nicole: the question is, is this a huge problem with the new blackberry 10 that we've waited 18 months for? or is this sell on the news? is this a product that won't be competitive to samsung and apple and the like? here it is down 9.5%. this stock this morning was trading as high as 16.62. this was so much anticipation. in that hour right after the 10:00 a.m. hour you saw the extreme drop-off. we were up 5%. and now seeing it down 10%. also the other thing we should talk about is the volume. volume today is approaching 200 million shares. that's a nine year high, heavy volume on blackberry today. back to you. liz: look what i brought,
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nicole. i brought my current blackberry because you and i are the same. we can't let go of these guys. that's my current one. all right. it's pretty -- relatively new. but i have saved mine from 2001. look at how thick this thing is. nicole: does it have the roller on the side? liz: i have it right here. nicole: liz, you know, you and i are, we are destined to be great friends. big buttons, love it, never dies. if you drop it, the screen doesn't crack like the iphone. that's a great product too, the iphone. liz: it weighs a pound and a half. thank you nicole very much. precious metals -- we're exactly the same here. precious metals holding on to gains after the fed announced its plans to keep interest rates unchanged. sandra smith knows everything about this. she has more on what's happening there at the cme group. sandra: hey liz, i'm still cracking up, you can do it, you can move past the roller
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blackberry. we are looking at those precious metals and believe it or not, the precious metals go into the a lot of the cell phones that we do use every day. silver prices skyrocketing. post fed, they rose to their highs of the session. they were up more than 4%. they've since come back just a little bit. but up nearly 3% on the session. remember, we've been seeing a big sell-off in the precious metals markets of late. when you get the fed saying it is going to continue its asset purchases, the bond buying program, the concern about the dollar and traders start buying those precious metals. natural gas a big winner, rbob gasoline, soybean prices, corn prices, pretty much every commodity that trades at the cme group today up as a result of? what? a weaker dollar. after the fed's announcement the u.s. dollar reached a 14 month low against the euro. of course as we continue to speculate on how much this is going to devalue our currency here at home. and also, liz, i want to point sout that the long end -- i want to point out that the long end of the yield curve, the 30 year yield reaching a nine month
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high -- or sorry, a nine month low. so we continue to see a lot of movement in the treasury market, again, getting mixed up because liz as i toss it back to you, we have seen so much undoing of the trade that we saw post fed that these markets really are struggling to find direction. they don't know what the fed is going to do next. trying to put new trades on post fed announcement. back to you. liz: john brady in the pits with you was saying he's seeing a lot of puts out there for treasuries, which means sell, sell. thank you very much sandra smith. >> thank you. liz: my next guest would give the fed an f if he were rating its work. he says policy is very much part of the problem and it is time to trip the rate wire already, hike those rates and raise interest rates sooner rather than the 2015 date that they have put on the calendar. cato institute senior fellow and former dallas federal reserve vice president, joining me now in a fox business exclusive from
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reno nevada. gerry, an f? i understand how you feel about this especially because you talked once and you say this is an artificial rebound that they have engineered. let's use that word. and yet i would say that a lot of smart people have given ben bernanke a thumbs up in many cases, for example, lou dobbs who feels they did what they had to do. i was talking to some russians who are big in business overseas, they said central bank saved us. but why do you feel they deserve an f grade? does that go for all 13 semesters that we have passed over the past several years? >> well, i don't know if i said an f. but look, they did the right thing in 08. you know, back in the lehman failure and so on. they provided liquidity to the market. but now what they are doing is making whole asset classes and segments of the economy dependent on more stimulus. and the problem is it's going to take more and more stimulus to run an economy on fumes, basically. now, of course there are underlying factors, normal
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market factors that are helping the economy recover. so two things are going on. but i think the housing is already worrisome, housing prices. and they reflect some special factors. so -- and the low interest rates are great for borrowers if they can get the money, but they don't motivate creditors to lend the money. liz: so it's almost a net-net neutral; right? you are saying which in essence what john taylor said in the "wall street journal" yesterday near 0 is great because yes it makes people want to borrow, it doesn't want to make lenders lend because they are not getting a great rate on the money they get. but they are at least getting something. so then my question becomes, if not 2015, when should they tighten rates? and i have tried to push a lot of people on this, i can't get a straight answer, maybe i can from you, how would the world and the markets react the minute the fed telegraphs we're ready to tighten rates? >> oh i think you will have a sell off the minute they telegraph they are going to raise rates. not the minute they raise rates
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but the minute they telegraph. i will tell you when i think they will raise rates not until they see the whites of the eyes of inflation and by that i mean i would be amazed if they turned around on rates before inflation is in the 3 to 3 1/2 percent range, possibly higher. liz: i don't want to get too in the weeds about this, but when you look at something that our own charlie brady from our assignment desk pointed out that was st. louis fed adjusted monetary base, this is as if you took an entire steaming melting pot and threw in everything the fed has done and you superimposed it over the dow jones industrials, they pretty much mirror each other. so it is propping up what's happening, forcing people into assets like equities. you know, would that overlay completely switch out? >> i mean i have not seen that analysis, but it doesn't surprise me. yeah, i mean it's what i'm trying to say. the stock market, the asset and
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whole segments of the economy are dependent on not just continually stimulus but going into the future, it will take more to do the same thing. liz: okay. gerry o'driscoll of the cato institute, a senior fellow and also the former dallas federal reserve vice president. thank you very much. we will be right back. dow jones industrials increasing losses, now down about 45 points. all stations come over to mission a for a final go.
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liz: shares of embattled boeing, a lot of you own this stock. it is a dow component. well, they are moving higher today. about 1% higher, after posting better than expected quarterly earnings. why are they embattled? well, the aerospace maker now remains focused on fixing its 787 dreamliners weeks after regulators grounded them all due to problems with batteries overheating. billionaire entrepreneur is weighing in today, the founder of space flight company saying
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quote: liz: he wrote that to a blog. not everybody is concerned about this. last week in davos switzerland i sat down with the chairman of chinese airline conglomerate hna group who told me exclusively why he still really likes the dreamliner. listen. >> the dreamliner is a good aircraft. liz: he has 42 ordered. he's still waiting for delivery. he's very excited, but he said, yeah, they keep delaying it. he's had the same problem as a lot of other companies. but right few he runs -- but right now he runs 14 different
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regional airlines in china, operates 11 airports. he is sticking by the boeing dreamliner. what is the biggest bidding war on wall street? no it is not the deal to take dell private. it is the deal to take -- -- it is the deal to take khuz private. charlie gasparino is joining us now. >> khuzami is a very experienced lawyer. worked for mary jo white. head of the enforcement division for four years. he's going to resign in february. what we understanding is there's an interesting bidding war, a lot of firms are interested in
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hiring bob khuzami for obvious reasons. what we know is this, he's likely to go to a new york based law firm, maybe a washington office, maybe stays in washington, but likely to be a new york based law firm as opposed to going back to a wall street firm. why is that? we're hearing this from people close to him, he's very worried about the sort of conflict of interest working for a wall street firm. even though when you work for one of these major law firms, right -- liz: you're representing the wall street guys anyway. >> right. he doesn't want to go back. he got a little -- he got some criticism because he worked for deutsche bank, right, before he came to the sec. he was the general counsel of deutsche bank at a time when the financial crisis was going on. so what i understand, his first stop, he may go back to wall street, but his first -- at least this is what he's telling people, who knows. when you throw a lot of money at people, they do crazy things -- is a law firm, preferably in new york. who is he going to be replaced by at the sec? the name we keep hearing is his
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assistant. what's interesting about this at the sec, i have been covering sec now for over 20 years, they usually had a lot of homegrown talent particularly go to the enforcement division. like steve cutler became enforcement director after bill mclucas and dave walker, they all came through the ranks of the enforcement division. this is different. what you have now is guys like him who used to work for mary jo white at the u.s. attorneys office. it is like the u.s. attorneys office from manhattan has taken over the enforcement division at sec. kind of interesting dynamic. you know, people talking about it. a little bit of insider baseball. what does that mean for investors? what does that mean for the company? you know, you are going to see a much more -- it will be continued -- it will continue to be an activist agenda there, particularly on enforcement actions. bob khuzami ramped up the enforcement actions, record years in 11 and maybe even 12. liz: he was highly regarded.
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>> highly regarded. with his assistant in there, likely to be appointed, not been finalized yet. mary jo white has been appointed by president obama. she needs to be confirmed i believe by the senate. you are going to see that same mindset continue. wall street should expect these enforcement actions to basically keep coming. liz: separate of that, i've seen a lot of questions about this, that the sec when they nail certain wall street firms, they get their fines, but there's no admission of guilt or anything like that or denial, just here's the money. should that change? >> i don't know. there's two ways of looking at it. you really do want the wall street firms to pay up -- liz: to pay up. >> if they admitted wrong doing, that would open the floodgates for civil civil litigation where
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they would be put out of business. is that right? this is a debate we can have all day. the financial crisis occurred. there was some fraud involved. it's always been my opinion. but the reality is guess what? irrational exuberance is not a crime. that thing was based on a lot of hype and bubble mentality. that is usually stupidity, not crimes. liz: a lot of people got swept up in it, not just the financial firms. the one problem is only a certain portion got bailed out. >> that's another thing and why they got bailed out is because we needed a banking system. we can debate that. anyway bob khuzami is probably going to make a ton of money. liz: he's always welcome on this show. i gave you the ticker symbol robert khuz. >> did i spell his name right? liz: you got it right. you got your shirt, tie and the jacket wrong. >> i'm going to change in a minute. liz: too many stripes going on. >> i know.
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liz: thank you very much. we will be right back. and again, continued acceleration in losses for the market, all red on the screen now with the dow down 45 points. we're coming right back. stay tuned. tdd#: 1-800-345-2550 when i'm trading, i'm so into it,
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liz: the corporate debt market may seem a little bit like unfamiliar territory some of you, but here's why you the investor should care. corporate debt, corporate bonds often a key tell for the stock market. case in point, look at the performance of something called the spy etf, a proxy for the s&p 500 and then you compare it to lqd, that etf which is the blue line obviously outperforms.
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that's for investment grade debt, the corporate bonds, practically mirrors the image except there's a bit more strength. will the strength continue? and where can you find some opportunities? mark kiesel is pimco managing director. he is a five star super manager. to watch all the accolades that come in for you from very quality sources, we are really happy to have you here. thank you very much for coming on. >> thank you. liz: and because we care so much about our viewers is why we wanted to have you on. you have had some great returns for your investment grade corporate bond fund. let's get right to it. you know, do you feel that this is a trade that does continue to grow for people? >> well, i think we've seen is a lot of outperformance by equities and credit over the last several years. i think now we're in more of a range bound environment where investors should expect to earn yields, not too much more price appreciation, so we're looking at more of a 3, 4, 5 percent return for corporate bonds which
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is much lower than what we have seen over the last couple of years. liz: are you positive about the american economy? i'm understating it, in essence you are absolutely thrilled about how america is doing, you are bullish on america. i don't know if you saw the top of our show, gerry o'driscoll, the former fed insider was telling us he thinks this is an all artificial recovery. i presume you take the opposite of that trade? >> well, we're looking at 2% real growth and 4% nominal. so we're still in a below trend growth, but there are some bright spots. and we would point to housing and energy. housing because we're recovering off of very low base. and we will get double digit growth rates in housing sector. so we like a lot of companies there. liz: how much will housing contribute to real gdp there? i mean what are you expecting? >> so really there's a direct and an indirect component. directly through residential investment spending, we're looking at at least half a percent contribution to growth this year. the indirect effects would be higher home prices, potentially
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leading to a modest wealth effect in helping the consumer indirectly through higher consumer spending. liz: what do you say to the bears who say that this impressive move on behalf of housing -- of housing over the past year is really just a bounce off of very low spongey bottom? >> i think we're in beginning stages of what will be a multiyear recovery. i don't agree with that. because the inventories are basically at 11 year lows for existing homes. they are at near 20 year lows for new homes. and so basically we're so depressed that you can grow for several years, double digit growth rates, just to get back to a 50 year trend line. you're still looking at several years of growth ahead. liz: well, let's say you are right, and i happen to be on the side that believes you are very much in part right, what trade would you make there? would you do the actual homebuilders? or would you do the sort of as we call them the derivative plays where it involves the actual materials for this, like a lumber play or things like that?
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>> right, we like the derivative plays better. we like companies like weyerhaeuser which is a company that has 6.3 million acres of timberlands. a company that's 75% of its earnings geared to a recovery in housing. we like building materials companies, like masco, companies like usg. companies like whirlpool, one of the largest appliance manufacturers in the world. so it's the derivative plays that we think make the most sense. liz: okay. we're leaving these up here so people can look at them. because again i remind people over the past three years your fund has had 11% annualized rate. he came out number one out of 530 funds in his category. this is why we're listening to him. here's the one year chart. looks very healthy. what would you avoid? what scares you? >> well, what scares us right now is long maturity bonds, long
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maturity treasuries. we ultimately think the fed is going to win the war, and we're going to see gradually higher inflation over time. the economy is gradually improving, and so what that means is that interest rates over time and this could take a year or so, will likely head higher. and we think inflation gradually, there's going to be an upward bias. so longer maturity bonds don't make much sense to us right now. we prefer more intermediate part of the curve. we like taking less interest rate risk, and we like taking a little more credit risk. but again, you have to be more selective now within the credit markets because a lot of the returns have been made in the market. liz: there's a little bit of warning there from mark kiesel. we really appreciate it. thank you for coming on. >> thank you. liz: he is pimco managing director, five star rated fund, michigan wolverine, what's not to love; right? thank you mark very much. down about 48 points for the dow jones industrials with 15
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liz: this is some, not all, but some of the homebuilder stocks are struggling today despite several of the companies reporting solid earnings this week. nicole, i'm looking at kb homes. that's in the green, but a couple of others are down. nicole: that's right. kb home actually hit a 52 week high. we should take this in two parts liz. the first part is how the homebuilders are faring today. with the exception of kb homes you are seeing a majority of them lower, toll brothers, lennar, also hovnanian all under pressure. however, for the latest year, over 52 weeks some of these stocks have actually doubled. for example hovnanian is up 155% in the last 52 weeks. our latest numbers that we've seen for pending home sales, existing home sales has been a
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little bit weak but on the one case they were saying that may be because more of a tight supply than it was slack demand. year over year you have seen homes improvement overall right with prices and sales for that matter and the stocks have run up along with it. when i talk to traders they obviously note that some of these stocks have doubled and maybe it's time to take a little breather. so right now we are seeing some of these homebuilders pulling back with the exception of kb homes with the upgrade today. liz: can you imagine if you're a trader on the floor and nicole comes up and says tell me about the homes. okay, whatever she says. she gets them to tell it all. thank you very much nicole. facebook, okay, start the clock, set to report earnings after the bell today. for the magic number to watch for, stick with us, we will tell you is once again the mobile ad revenue, but shibani, i would argue that revenue in its entirety is also important; correct? shibani: absolutely. this is another important earnings report coming out of facebook. quarterly check and a status
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report where everyone is going to gauge whether or not this company is making strides in that mobile arena. we're looking at 15 cents per share in revenues of 1.53 billion dollars. what's kind of astounding about that revenue number, that it is a 34% jump from the previous quarter. so they are doing something right. some key revenue drivers and things that we're going to be looking out for in the way of factor, social ads, payments, mobile, mobile, mobile. it is all about mobile. 14% came from mobile in terms of overall sales. you need that number to grow a whole heck of a lot more to actually prove to investors that it is taking advantage of the fact that more than half of its monthly users actually access the site on mobile. the other thing, the stuff that it dreams up in its facebook labs i call it, i've been playing around and got on a beta test this week, that's pretty cool, the poke application that came out, even promoting posts and gifts, we want to know what these sort of outside endeavors do for the bottom line.
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a lot of big questions, but mobile is the central theme. liz: the last time it was 14%. you said they need to see it a lot more? shibani: yeah, i think i was reading 24% is what sort of the whisper number is. liz: hopefully they got to work on that one. we will be watching. thank you very much. by the way, we're going to have full coverage of facebook earnings out after the bell today. facebook, we also have qualcomm, electronic arts starting 4:00 p.m. eastern. do not miss it. david asman and i will have all these numbers the second they come out. speaking of seconds, six minutes and about 50 seconds left before the closing bell rings. some old economy names are taking quite a hit. quite a pullback for things like trains planes, even truckers. we have the details for you when countdown returns. stay tuned.
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liz: so early this morning when the gdp number for q4 came out and it was minus 1/10 of a percent, the transports started to reverse. now, they have just hit a record high recently. and you can see this one year chart looks absolutely fantastic. then today you see the pullback of 1 2/3 percent as that weaker gdp number than expected made people question the durability of the recovery. flip over to what's in the transports. you have planes trains automobiles truckers. you have union pacific and norfolk southern, the railroads, pulling back, they're sort of the bigger leaders in the fall of the transports today, fedex is another one in the transports along with ups. that's down about 1%. but we're waiting on names like qualcomm, like facebook for earnings. it's coming up right now as soon as we get those numbers, david asman is going to have them along with -- david: a fascinating market
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today, particularly when you look at things like rimm which initially was up about 4% but then as soon as the products came out, boom, it went down. let's go to nicole petallides at the new york stock exchange. liz: nicole? nicole: all right. research in motion, let's start with that, up about 5%. they actually released the blackberry 10 finally after 18 months. and everybody is disappointed for a number of reasons. and then you see the stock sinking 10%. not what blackberry had been hoping for. david: yeah, that's the thing. and clearly this is the highest volume they have had in nine years right now, research in motion. by the way, they have got a new name, february 3rd i think is when -- february 4th is when the new stock symbol comes in. nicole: i have to say one thing, the phones aren't coming out till march and april, and a lot of analysts are saying they will lose what little momentum they have gained just by this launch. liz: let's get to facebook because it is moving higher. getting

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