Fact, 121. 3 degrees fahrenheit in south australia, feel like a weather girl. They have had to add new colors to the weather map in australia and its purple. Thanks for watching street signs, everybody. It is warm. Closing bell is next. Welcome to the closing bell. Im Bill Griffith at the New York Stock Exchange where the dow is trying to start off this shortened holiday trading week on a winning note. Yeah. Were at the highs of the session right now. We are, a pattern weve seen for the past couple of days. Im Michelle Carusocabrera maria is in davos. Well hear from her in a little bit and huge earnings due in one hour. Topping the list, google and ibm. These are the numbers that could drive the entire market tomorrow. Were going to have what you need to know the moment they come out tonight. Also, look forward to Texas Instruments numbers out tonight as well and a new tax on every share of stock you trade. She loves this story. Looking more likely in europe. Could it be a coming to wall street as well . The cd of Td Ameritrade will be joining us for that, among other things. Earnings and lots more to talk with fred about. Retail and whether investors are coming back. Big nightmare for boeing, the dreamliner with problems and its stock still down. Right now the news is not getting any better for the aircraftmaker. Weve noticed a trend lately. You see some selling in the morning and then buying in the afternoon, and we have often thought of the afternoon trade as the smart money. And you see it right there on the intraday chart. I am so old, phil, i remember we introduced the infraday chart, a phenomenon that we could see what what is happening tick bytic, and there you see the pattern. And im so old we were handwriting the intradate chart. Nasdaq doing the same thing. Back in positive territory after spending much of the day negative. Up three points right now at 3138, and the s p, any positive close for the dow in the s p today will be another fiveyear high. So the markets are holding on to the steady gains so far. Let take a closer look at the moves at this point. In todays closing bell exchange. Carol roth author of the entrepreneur equation and steve saks and michael from Janney Montgomery smith. Good to have you here. Let me start with you, scott. What do you think about this move . Are we going to get more of this . Is this just the beginning, or are we in for pullbacks considering what could be coming to washington the next couple of months . I think pullbacks are norm a. Lets face it, the last couple of months have been a big party. Ben bernanke invited us and i dont think the punch bowl goes away. The fed is the key issue right now. Does that trump the fundamentals, all the earnings were getting, you pay more attention to the fed . You think we have low growth and quite frankly investors are starved for air. They have been holding their breath for four years. There is no oxygen in any other market. Theres no place to go for yield. Therefore, essentially i think ben is terroristing it to the point to where they got to jump into risk assets and thats what were seeing. David, does that make you bullish as well . David . We do have a david as well. David steinberg. That would be steve saks now. Does that make you bull strategic defense initiative. We had a change in guests. Yes, we did. Changed at the last minute, i guess. Theres a lot of factors that make me bullish right now. The Macro Economic picture is definitely one of them. You know, you nailed it with the fact that the fed is still printing money and despite the language that we saw in the last minutes, theres no clear sign that thats going to end in 13. Well have a much better picture in the next couple of weeks. Its pretty good. Fact of the matter, valuations and u. S. Equities are pretty attractive right now. My dear friend carol roth, you have been skeptical of this market as we continue to go higher and higher and higher. Were at fiveyear highs right now. I guess we should all say its time to tell when you go bullish, is that it . Thats probably right, bill, but i feel like everybody is drinking the socalled punch or the socalled koolaid so why not join the party for the time being. I dont think theres any good fundamental reason here, but, look, theres nowhere else for anyone to put their money. Theres a lot of Financial Engineering opportunities here. Theres still strong balance sheets. Youll see more buybacks. Well see more dividends based on the way the fiscal cliff shook out here, so i think that youre going to see at least in the interim some good growth. However, there are certain sectors that im very concerned about. Such as . Restaurants being one of those. Restaurant is one of those sectors. I think from obama care to the cost of cattle, to the fact that consumers are seeing less in their paychecks, especially in the crashual dining sector, thats one to watch. What are you thinking at this point . We still have mark, dont we . Yes, you do, michelle and happy to weigh in. Hate to sound like the consensus, but i think the fact of the matter is even putting aside the feds manipulation of the Interest Rate curve the economic fundamentals continue to show dose ent outcomes. In fact, were projecting that they will continue to improve over the course of 2013, so from a sector perspective, while i would agree with the other guests in terms of the pressure being put on consumer wallets, other sectors Like Technology that we think is going tonight benfector of a release by pentup demand by business spending which has been paralyzed by the prospects of the fiscal cliff. Can you name specific names that you like . Sure. Within the text Space Company by the name of qualcomm, obviously a play on the smartphones and the expansion of a tablet market. Even though its gotten crushed here recently, intel trading with a fourplus dividend yield and microsoft remains a very high Free Cash Flow and flowyield story, above market dividend yield and once again part of the business suites, so all three i think are good for capital aration and or income here, for that matter. Would you buy apple . Most definitely, bill. I we did just last week. At 500 a share it looks extremely appealing to us on a number of valuation measures. Scott, you talked about the struggle to find yield. Correct. So many stocks out there in the s p 500, the stock actually yields more than the debt, and even though people have been piling into dividendpaying stocks, still high yields. Historically you would have to go back a long way to find the s p yielding in excess of the bond yields of those same companies. In fact, it makes no sense, because dividends can go up over time. You can have growth of the investment and you cant get that in the bond market. That underlying asset doesnt necessarily appreciate the way stock can. I grew up a bond person, but right now i find they few reasons why i would want to be in highgrade bonds. What are you buying at this point in time . I think asia is maybe a better place to look. Its not that we have a punch bowl here. We have a punch bowl globally. Japan is getting bigger now, yes. We have competition for materials. Materials have a lot of move on the upside. We saw freeport come this morning with earnings. They beat earnings handley. They are getting into the oil business. Some people agree. Some people dont agreement lets face it. The drawdown on copper and other building materials, not only in the United States but over in asia, youll have competition for those goods and a Monetary Policy thats flooding the system with currenty. Steve sax, your best investment idea right now . I think sectorwise, i hate to do it, but i have to agree on tech. I think its an area that obviously had good performance in 2012. We think that continues, although the first couple of years have been a little rough. Look at the other sector you know, that have performed well late last year, financials, and then were seeing, you know, industrials and materials pick up this year as well. Consumer discretionary which we touched on is an area that i would take a look at. Its been tough to make money shorting the American Consumer over the long term and the pickup in the Consumer Discretionary secretary ore probably continues, at least the first half of this year. Carol, you told us what you dont like. Restaurants. What do you like . And for how long . So i love the multilevel marketers that everybody else seems to hate and fair disclosure here. Ive got a position in herbalife, but i think that these Business Models have been fundamentally misunderstood. They sell entrepreneurship, and entrepreneurs do fail at a high rate, but that doesnt make it a bad business model. Just like franchising isnt a bad business model. They are undervalued. They have got great cash flow positions. They are trading at really reasonable valuations, and i think that new skin, herbalifes of the world, great options. They have got huge exposure internationally. Very little in the u. S. , so i am going to say even though they have been up, up, up, i still like both herbalife and newskin. Thanks for your thoughts on the markets today. Thank you. Dave, thank you wherever you are. Google highlighting a big day for earnings after the bell. A preview of the numbers google has to focus on. Looming issues and growth in the core search business has been fantastic, and in youtube, too, but as the computing world shifts to mobile margins are under attack on the multiple fronts. Two main numbers. A tricky nim number. Currency numbers will make it look worse than it is and google makes less money from mobile ads that pc ads and more people are going mobile. And hardware. Samsung is spreading the android gospel worldwide which is good for ads and making it tough for googles motorola unit to make a prompt another big loss in q4, analyst will have a lot of questions about cuts. The headline, the street wants revenue around 12. 36 billion and 10. 52 eps. Jon fortt will have those numbers after the bell. Look forward to that. Breaking news on the israeli election with tyler. . Thank you very much. The early exit polls in israel indicate that Benjamin Netanyahu has won a third term as Prime Minister of that country. Those terms have not been continuous or contiguous, i should say. Hes projected to win though a center left party, a relatively new one, has made surprising gains according to news reports and that could make the coalitionbuilding over there a little more tricky. Right now the prediction is that Benjamin Netanyahus likud party has won about 31 seat in the in the parliament and will take the lead in forming the government. Netanyahu had called these elections in a way as a reflection of his policies on the west bank and settlements, the quelling of the uprising in gaza and, of course, israeli relations or lack of relations, i should say, with iran. Many people and political observers there believe that this will then continue his relatively more hardline rightleaning policies on all of those three issues. Netanyahu, according to exit polls, will once again be Prime Minister in israel. Thanks, tyler. Heading towards the close. About 50 minutes left in the trading session just off the highs of the day. A reminder. Any positive close for the dow and s p, new fiveyear highs. Ameritrade getting a boost in trade today despite a drop in profits. Stock is up 23 over the past three months. Right after the break the ceo joins us with the real story behind this quarter and his concern of a proposed trading tax in europe and whether it could make its way here to america. Also. Big Earnings Reports after the bell coming your way. Do not miss the numbers from google and ibm. They have the potential to shake the Technology World and the important trading day for tomorrow. All the numbers coming up for you right here on the closing bell. Stay tuned. [ male announcer ] it was designed to escape the ordinary. It feels like it can escape gravity. The 2013 cclass coupe. Starting at 37,800. Executor of efficiency. You can spot an amateur from a mile away. While going shoeless and metalfree in seconds. And you. Rent from national. Because only national lets you choose any car in the aisle. And go. You can even take a fullsize or above, and still pay the midsize price. Now this. Will work. [ male announcer ] just like you, business pro. Just like you. Go national. Go like a pro. Just like you. Itbut sleep trains huge foryeais ending soon. Models for a short time, save hundreds on tempurpedic mattresses. Get the most highlyrecommended bed in america at closeout prices. Plus, get interestfree financing and free sameday delivery. Why wait for the new models . Sleep trains year end clearance is ending soon. Superior service, best selection, lowest price, guaranteed. Sleep train your ticket to a better nights sleep as you can see, Td Ameritrade stock up about 3 , a little less than that right now. This morning the Company Reported firstquarters earnings actually slipped a little bit but results better than what wall street expected. Well talk about that, plus the talk that europe is expected to move forward now with plans to impose a new tax on all Financial Market transactions as a revenue generator, right . Could that be a preview of coming attractions for us in the United States . Certainly wouldnt be welcome news to our next guest. Joining us on set and a first on cnbc interview is the ceo and president of ameritrade. I do want to get to your trade and the stock and the Earnings Reports and everything else. This trading tax, this idea, do you think its a good idea, a bad idea . What would happen to you if they did it here in the United States . Possible it could happen in the United States . I think its a dumb idea, and history would prove that thats true basically. If you put tax in one country and not another, the trading will all move away and weve seen experiences of that around the world. I think its a bad idea. Im not sure what its trying to do other than penalize an industry. And i think in the United States, i think weve kind of moved past that on to other topics. Its not coming up on the radar screen right now. I dont see that happening, do you . No. Here, i mean. I think its going to happen in europe. The thought of penalizing the Banking System and wanting to tax everything in sight. People have to trade, trade what . People have to invest. Thats what they do with their money. If theres a financial transaction tax, would they not invest . They will trade differently. The trade flows and investments will move to different parts of the world is the Retail Investor coming back . The Retail Investor is slowly coming back. We had an average of 335,000 trades, pretty low for. 5. 8 activity rate. Low. Improved since january. The Investment Movement index said investors were increasingly bullish going into the year end. Weve seen that so far in january. So far in january every trading day our clients have been net buyers as well. Can we bring up the bar chart about the new asset class. New asset buying is climbing sharply. Thats right. Yet trading is down. Whats better for you, assets under management getting bigger or trading getting bigger . Ideally youd like both . Absolutely. I think in the short term the trading makes a big difference to the shortterm tradings and the asset gathering over time makes a big difference. The number that caught my attention was 80 billion clients are holding in cash. Its 90 billion now. 80 in cash, youre right. Whereas what, in 2007 it was only 45 billion. I mean, you have very cautious clientele right now. That is so telling. And your stock, because you cant charge them interest on those cash on the money markets. Because they would go elsewhere. I bet. Youre losing money on those accounts, right . The reality its grown so much because of the strong asset gathering, weve been doing the last two years over 40 billion. The reality is the percentage of client cash to total assets is actually still in the range of 15 to 20 . It hasnt moved. Whats going to bring them back then . Go back to that first question michelle was asking what. Will get that 90 billion to be put to work again, do you think . I do believe that what we have right now is the economy is getting better. The equity markets have improved. Standard poors 500 was up. The s p 500 was up 13 , 14 , up 4 year to date. Right. The economy is starting to show good signs. As long as we dont have it derailed in washington. I was just going to ask. I think things could get better. Could washington still screw this up . Absolutely. I dont think it takes much to have another debt ceiling debate and debacle would not be helpful here. I think theres so much minon the sidelines between the Retail Investor and the Corporate America today, has so much money to invest. Get rid of some of that uncertainty and this economy will go. Im quite bullish about that. Can you provide guidance for this year without knowing exactly what washington is going to come up with . We gave a range. We dont give guidance. We give a range on a conservative side and optimistic side. Were right inside that range. Had a great start to the year. Were ahead of consensus. We her record asset gathering and record guidance sales and great control. Had a great start. Had a good three months in the stock as well at this point. Fred, always good to see you. Thanks for coming by. The president of amayor trade joining us today. Dell shares sharply higher today. After david faber broke the news that microsoft is now in talks to help finance that buyout of dell. David joins us now with more details. They are getting a party together, arent they . Yes, they may very well indeed do that. There are still talks, bill. Its not a done deal, that is, until the terms of the lbl itself or microsofts investor. We reported microsoft is cont contemplating between a 1 billion and 3 billion investment. Not in exyou but considered a mezzanine financing similar between debt and equity having the name of a preferred, unclear whether its ever convertible into a equity stake, but people might understand why microsoft would at least have interest. Of course, it has 66 billion worth of cash. Much of that is overseas and there might be a possibility using the overseas cash without paying significant penalties on the use of it. Of course, it has an interest in one of its biggest customers continuing to do well. All of this, of course, would add to the overall financing for this huge lbo of dell which, again, as we reported earlier and can tell you now continues to be moving along a path towards completion. Any sources are telling me until the by the end of the week. This is not a done deal by any means, even in terms of an actual price that we know at this point, but it does appear to be getting closer. Microsofts involvement, certainly yet another piece of an overall pie here involving silver lake and what would probably be a 2 billion overall equity check from silver lake and perhaps some other investors, not microsoft. They wouldnt be they wouldnt be supplying the equity so to speak here for a deal, of course, that would be one of the largest that weve seen in technology in a very, very long time, bill. We shall see. Microsoft does have a history of making these kinds of investments, at least here and there along the way when it does see an opportunity, and for a company thats not earning that much in its cash flow, expected very least the return it would get if in fact dell does go private and says fiscally sounds would be a good one. Do you think michael dell just wants more flexibility by going private strategically . I mean, that would seem to be the case but yet if they add more and more and more partners in this whole deal that theoretically means less flexibility and the debt as well. Interesting, of course. Microsoft didnt own equity as i reported it would not. A debt security of some kind. He would still control 50 of the overall equity in private dell. That would give him enormous power, along with silver lake to do whatever it is he wants. One of the key considerations here will be our shareholders interests being looked out for by the special committee of dell right now in terms of allowing him to pay them what should be the highest possible number that they can get. For their shares. Right. Thanks, david. All right. Good stuff. See you later. Did he say hed do the balcony in the orchestra financeing . Only mezzanine, not the rest of it. 37 minutes before the close bell. The Dow Jones Industrial average is higher by 47 points as we head into the close. Do you think michael dell likes opera . Dont answer that. A private joke. Thank you. Who has more creative fees right now . Did you hear about southwest asking for 40 if you want to board first. Some people are actually paying that, so should you love the stock . Symbol luv love coming up next. No end in sight to Boeings Dreamliner nightmare. Top anrists weigh in on whether the stock is in danger of being permanently grounded, later on the closing bell. [ male announcer ] heres a word that could give you peace of mind. Unbiased. Some Brokerage Firms are. But way too many arent. Some of the ones that push mutual funds with their names on them arent. Why . Because selling their funds makes them more money. Which makes you wonder isnt that a conflict . Am i in the best fund for me, or them . Search proprietary mutual funds. Yikes, its best for them. Then go to etrade. Weve got over 8,000 mutual funds and not one of them has our name on it. Why . Because thats not the business were in. Were in the business of finding the right investments for you. Etrade. Less for us. More for you. But im still stubbed up. [ male announcer ] truth is, nyquil doesnt unstuff your nose. What . [ male announcer ] alkaseltzer plus liquid gels speeds relief to your worst cold symptoms plus has a decongestant for your stuffy nose. Thanks. Thats the cold truth the dow transport soaring hitting another alltime high for the fifth straight day. Bertha coombs has more of the details. Ber somewhat . Reporter michelle, one of the things that the bulls and dow theorists look for when you get the Dow Jones Industrial average hitting a new high, make things, followed by services along with transport, people that move people and thing. The best percentage gainer, kansas city southern. Fresh alltime high for the stock after its earnings were much better than expected. New highs as well for delta. Up 18 year to date. Southwest, up 12 year to date and j. P. Hunt, historic high along with Union Pacific railway. Bill . What a transition. Thanks you very much. Delta shares hit a new solid twoyear high and airlines one of the hottest sectors in the past years so should you get on board with delta, for example, or are you better off with a discount carrier like southwest which is pushing the boundaries with new fees . Now introducing this new 40 charge if you would like to board early and make sure you have room to store your carryonbag. Today on the technical side, carter worth, chief Market Technologies on oppenheimer. On the fundamental side, zachary kas kas karabell. Who do you like . Delta or southwest . In principal, group moves are the best kind of moves in the markets, and in this case all airlines are working. Lagged other transports such as rails and truckers, and the group is on the move. We like them both to the long side. They look like they have got plenty more in them. Zach, what about you fundamentally speaking . You know, i mean, they certainly have been on fire. Very different types of names. Delta is doing quite well relative to its competition like american which is emerging out of bankruptcy. Southwest you can buy a ticket but you have to pay extra to wear your clothes on the flight. I think the problem with the airlines is that they are such a volatile name that is so susceptible to trading activity and momentum buying by traders and not saying that as a negative but as an investment, i find these names incredibly difficult to be in in addition to their susceptibility to various macro headwinds from International Terrorism to the price of fuel. Right. So unless youre really sure of the trading metrics i would not easily be in any of these names. Thats exactly right. Almost that, trading chips. Not investments. Almost uninvestable and long term, of course, none have been very prosperous, but theres a lot of momentum and money flow and they have lagged the other transports to such a degree that i think the momentum here continues. Thats right. On that really simply, bill, these are an example if youre very comfortable with the trading metrix, go ahead, be right, be wrong, but dont invest in them because you think theres a thesis that will line up because of longterm fundamentals. All remember Warren Buffett swore after he sold the shares that hed never buy it as an investment. Thank you both for talking numbers today. S p also in positive territory, more numbers coming you have before the closing bell. Home sales declined this month. Well look at more of that coming up. And stick around for an earnings parade from google, ibm and Texas Instruments, a trifecta of tech. An instant analysis of all the numbers coming up on the closing bell. Tdd 18003452550 when im trading, im totally focused. 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Reporter sales down month over month, but they beat expectations and the reason being theres not much out there to buy. 1. 82 million homes on the markets right now. Down 22 from a year ago. A 4. 4month supply at the current sales pace, the lowest since may of 2005 according to the realtors n. Raw numbers the fewest homes for sale in over a decade y. . 10. 7 million borrowers under water and another 1. 3 million with less than 5 equity so those folks are stuck in place and investors are eating up much of the distressed inventory and bidding up whats left. Banks are Still Holding a backlog of Distressed Properties not getting them and builders ramping up through less the Housing Starts. That lack of boom is pushing prices higher. Competition for all cash investors is high. Like in phoenix, up 22 according to zillo. Nationally, home values up 26 in 2012 from 2011. Thats the largest annual gain since august of 2006. The peak of the housing bubble. Now a healthy Housing Market sees annual gains of around 3 , so this, believe it or not, is not good. We want to see home prices recover, but we dont want them to go faster than we see recovery in the overall economy, job growth and income. For more, of course, its on the blog realitycheck. Cnbc. Com. Guys . Diana, thank you very much. Is u. S. Housing the linchpin to this economic recovery were looking at . Cnbc chief writer jeff cox says yes and janes us to make the case and john mays says stronger headwinds are heading our way. Jeff, you say well have an economic recovery and housing will have to lead the way. Explain, and is it doing so . Remember that old admonition, if not us, who and if not now, when . That applies to the Housing Market. If not housing what . I mean, were seeing economist expectations of about 3 , maybe 2. 5 , 3 growth in the u. S. This year. If thats going to happen, its going to have to happen on the backs of the Housing Market. I heard some of the concerns that diane expressed. I dont think inventory will be that big of a problem going forward. So many houses that are had in the distress market pipeline. A couple of other quick points. Very quickly. Wealth effect that ben bernanke talks about is most prevalent in housing. Housing prices get pressured up, thats going to help the wealth effect. Okay. Finally the stock market historically tells us when Housing Starts are up more than 25 in the previous year, the next year equity market gains about 9 so thats an important metric to consider as well. All right. Well, john, lets talk about that housing recovery. You dont think that its real. Why . The housing recovery has been real. Weve had a nice move. I just dont think its going to continue for two reasons. One, we have had a nice move so weve discounted all the good news that jeff is talking about, and secondly i think the u. S. Economy is going to slow sharply this year. Housing has done okay with a 2 underlying growth rate, and a lot of help from the fed and a lot of help from fiscal stimu s stimulus, but the stimulus that weve had in the past pushing us as a tail wind has been 2 of gdp and this year it will be minus 1 to 2 so a huge swing to the negative in fiscal stimulus, so the feelgood factor in the Housing Market goes away as the economy drips down under 1 growth by midcareer. What the underlying premise that housing led us into the boom, it led us into the bust, it will have to lead us out again. Do we real very to accept that . I mean, there could be other things, right . Does it have to be housing that suddenly changes everything . Weve had dotcom booms and oil booms, does it have to be houseing . Isnt that what got us into trouble as being a huge part of the economy . Yes, thats a good point. Look. Stocks have risen in value so weve had a positive wealth effect there. I think i think if were saying lets go back to the economy the way it was before 2006, its got to be housing. Corollary is were not going back there. Its not going to be housing. Too many people are shy about about putting too much into a house. The percentage increases in housing prices in some markets are high, but they are from a dreadly low base. Yeah. So i think weve seen a nice recovery, but i think its probably pretty much there or overdone, and when we are searching weaker economic data, the fed is tapped out on qe and a big drag from fiscal policy. House will go actually probably go down. Of course, jeff, housing can only go so far without more job growth, dont you agree . Yeah. But, i mean, i think the federal reserves telling us that they are just going to go out there and pump and pump and pump until they get down to 6. 5 , so, you know, again, i think youre making a recession case if youre saying that the Housing Market isnt going to come back. Another number that i wanted to look at, that diana tal in terms of negative equity on the home. Did see 100,000 more homeowners get into positive equity territory the past quarter which i think is important. But, they have come from negative equity and they thought that the house was going to be the big asset. As for the fed, you know, they can say they want to get the Unemployment Rate down to 6. 5 , but right now its at 7. 8 and probably isnt heading lower very fast. I dont think anybody is talking about rapid growth. Im certainly not. Im just saying if were going to have economic recovery this year or Economic Growth period, and i think we will, i think its got to be housing, and i do think that that is going to be the place, if we can continue to get this continued growth, thank you. I have and j, thank you, jeff and john, good to see you. 20 minutes left in the trading session, and the dow is stuck here. Up 50 point. Again, ill remind everybody that just joined us, any positive close today for the dow and s p, another fiveyear high. Get your party hats. All right. Two of wall streets biggest bulls join us next. And golf great Phil Phil Mickelson in hot water over the comments he made over the weekend about taxes in california. Hes apologize being, but he may not be alone with how he feels. Find out how wealthy people really react when taxed to the max, and heres a hint. Moving trucks may be involved. What we need are people prepared for the careers of our new economy. By 2025 we could have 20 million jobs without enough College Graduates to fill them. Thats why at devry university, were teaming up with Companies Like cisco to help make sure everyone is ready with the knowhow we need for a new tomorrow. [ male announcer ] make sure americas ready. Make sure youre ready. At devry. Edu knowhow. And having an investment expert Like Northern trust by your side makes all the difference. 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Our next guests are a couple of the biggest market bulls out there. With us today, brian belsky from bmo and Richard Bernstein and our own courtney reagan. Brian, what are you bullish here . Well, we think, first off, that the u. S. Is exquisitely positioned as an asset with respect to equities. We believe the next cycle will be defined by multiple expansion as investors come back and buy the stability of u. S. Stocks. The upside will be driven by surprise u. S. Domestic recovery, the second half of the year, michelle, and as Business Volumes come back to america, manufacturing capacity comes back. We have a cap x revival and u. S. Stocks lead the way. And, rich, i know brian is reading the same script you are, but are we getting ahead of ourselves. I mean, you have been a raging bull for a while now. I mean, youre talking generational bull market here, but are we getting ahead of ourselves with the kind of gains weve seen the last couple of months . There could be. In the very short term, not very good about the very short term. Theres no doubt that people have gotten a little more bullish, but lets remember where we were that people were so horrifically bearish, end of the world and even still you have a lot of doubters out there. I think the time to really wore frea Strategic Point of view or even from a text call point of view is when people believe the bull market is not going to stop. I think well all agree were a long way from that. So contrary indicator, when everybody is worried. Courtney, what are you hearing from investors about whats moving the market . Need more cat lifts to really get involved here, and i think a lot of this is relative. Again near net 1,500 mark on the s p, but its been five years since weve been there so were sort of creeping back higher. Yes, earnings are so far a little better than expected, but that bar is relatively low, so, again, its all about these relative expectations. I think theres a bit more cautiousness. Also, you know, we just inaugurated president obama again yesterday, and in his speech, didnt really mention much about the economy. Its all very social. Im not sure that wall street really heard what they wanted to hear from that yesterday, so i think theres still some questions there. Or people who want jobs either. Brian . Exactly. Well, we think that were heading into a similar type of move from 82 to 2000. Heres the difference. The markets are rarely linear. Down years in those period, just like we did with volatility in 1987 and 1994. We were marketing in europe and saw a lot of institutional accounts, and from a contrarian basis well tell that you european clients are once again bowled up on europe. They are extremely reluctant buyers of u. S. Stocks, and, again, a lot of local market bias when you talk to european institutional clients, but we think its very key to understand that the u. S. Is quite bitter, itching to buy europe and thats another reason to be bullish longer term. I dont think people should be making shorter calls on longterm markets. In the longer term we think the market here in the United States will outperform. Rich, whats going to take us higher from here . What would you buy . Brian kind of mentioned this before. I mean, were very big fanses of small and midcap industrial u. S. Focused companies. These companies are gaining market share from from overseas. In fact, jeff immelt was quoted about six months ago of saying that outsourcing may be an obsolete model of business, and whats happening is that now companies are increasingly beginning to look at the total cost, not just labor costs, but transportation costs, energy costs, Political Risk costs, all those type of things and they are realizing, hey, maybe manufacturing in the United States isnt so bad after all, and so actually small and midcap Industrial Companies and manufacturing companies, the stocks are doing exceptionally well, and nobody cares. That anything to stay away from, rich . Id personally stay away from the emerging markets. Everybody loves emerging markets. Just had massive inflows and record inflows into emerging markets. Many of the major emerging markets are caught between inflation and growth. I dont know if anybody saw wholesale food prices in china this morning. They came out much higher than expected. Thats exactly the next step here. They are starting to juice up growth and inflation is quickly coming back. Thats the problem that you have in india, the problem you have in many of the emerging markets. Brian, you were nodding your head in agreement he said avoid. We tend to stick with the last dance parter too much and stick with whats working. Growth the last ten years has been defined by emerging markets. Think of growth as mashed potatoes and gravy. We think its going to be the inverse the next five years. Technologies and Energy Companies benefit and we have to rethink, the developed market, especially the u. S. Will be the mashed potatoes part of the growth. All right. Very growth. Rich, brian, apparently youre joined at the hip strategically. Brian wouldnt have lunch with me today though. He cancelled on me. Because he knew who would have to pick up the check maybe, i dont know. See you guys later. Courtney, see you later. Get red for the big Earnings Reports coming out at the top of the hour. 12 minutes before the closing bell. Dow jones industrial average higher by 42 points and the nasdaq is up one point. The nasdaq is up one point. Objection i was looking at the right thing. When we come back, were heading to the World Economic forum in davos, swit land. A preview of all the wall street heavyweights she will be talking to this week. And despite fears of massive spending cuts defense stocks keep rallying. Find out if the sector can rocket even higher when earnings kick off tomorrow. [ male announcer ] you are a business pro. Omnipotent of opportunity. You know how to mix business. With business. And you. Rent from national. Because only national lets you choose any car in the aisle. And go. You can even take a fullsize or above. And still pay the midsize price. I could get used to this. [ male announcer ] yes, you could business pro. Yes, you could. Go national. Go like a pr [ construction sounds ] [ watch ticking ] [ engine revs ] come in. Got the coffee. That was fast. Were outta here. [ engine revs ] per tradition, Global Leaders and the biggest names in business are gathering at the World Economic for number in davos, spits land and are, of course, talking to my partner maria bartiromo. Maria right there now with a preview of what she will be bringing us all this week. Maria . Hi there, bill. Thanks so much. Coming to you from davos, switzerland and the World Economic forum has officially kicked off here in davos. We are gearing up to talk to some boldfaced names. Weve got leaders from around the world gathered here to talk about the economy, talking about the issues of the day and their businesses. Let me give you a a heads up on who were talking to this week. Check out this lineup, bill. First up, well talk to investor george soros and find out how he is allocating capital around the world right now, particularly in europe where were still talking about the european debt crisis. Well also talk to the man who led the worlds most profit kabl bank in 2012. Yes, jpmorgan ceo jimmie dimeon. Both of those interviews tomorrow. Citis new commander in chief, michael corbat, the first ever ceo and the worlds second wealthiest man bill gates talking to me on friday. These interviews you cannot afford to miss. Hope youll be joining us for all of that, get a real window into how business is going and what these folks are expecting for 2013. Meantime, bill, ill send it back to you. Looking forward to that very much. Some of the big ceos mingle with those politicians, and you know Angela Merkel will be there. Shes a big proponent of that financial transaction tax that everybody is talking about. I bet the american ceos might be egging her on, because if they do that over there, do you know what that means for Financial Transactions . They come over here. Move from other parts of the world. Germany, want to do a financial transaction, Deutsche Bank is thrilled with that. Go ahead. And one of the savviest investors around george soreio, interested to where he sees some value right now, if its time to get into europe in a big way right new. And hes going to be thrill. His candidate just won here in the United States. Hes a very political person here as well. Yes, he is. Love hearing from george soros, just my fave. Youre a big fan. Look forward to all those interviews that maria does from davos every year. He thinks hedge funds should be regulated but the minute they are he changes it so they are not regulated. I could go on. Whats coming up, michelle . Up next, coming back with the closing countdown. And moment away from two huge Earnings Report that could drive this market the rest of the week. We vin stant analysis on the numbers of goingle, which the numbers have just come down, and ibm moments away. Youre watching cnbc, first in business worldwide. [ male announcer ] dont just reject convention. Drown it out. Introducing the allnew 2013 lexus ls f sport. An entirely new pursuit. Introducing the allnew 2013 lexus ls f sport. Hes going to apply testosterone to his underarm. Axiron, the only underarm treatment for low t, can restore testosterone levels back to normal in most men. Axiron is not for use in women or anyone younger than 18. Axiron can transfer to others through direct contact. Women, especially those who are or who may become pregnant, and children should avoid contact where axiron is applied as unexpected signs of puberty in children or changes in body hair or increased acne in women may occur. Report these signs and symptoms to your doctor if they occur. 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Read and consider it carefully before investing. Risk includes possible loss of principal. [ male announcer ] this is karen and jeremiah. They dont know it yet, but theyre gonna fall in love, get married, have a couple of kids, [ children laughing ] move to the country, and live a long, happy life together where they almost never fight about money. [ dog barks ] because right after they get married, theyll find some retirement people who are paid on salary, not commission. Theyll get straightforward guidance and be able to focus on other things, like each other, which isnt rocket science. Its just common sense. From Td Ameritrade. Welcome back. Three minutes before the closing bell rings. Want to show you this trading pattern. This has been typical for the last few weeks now where you get the selloff in the morning and then we drift higher the rest of the day, and the feeling, prevailing wisdom is that its the Late Afternoon trade, that thats the smart money coming into the market here, and once again that seems to be whats happening here. Were finishing neither highs of the day with the dow gaining about 56, 57 points and, again, any positive close for the dow and s p a new fiveyear high. Then we wait for more numbers or the bell. Google starting to roll over near the close. Estimates for their earnings were coming down. Initially we heard 10. 47. Now its down to 10. 42 for googles earnings. Well see what those look like and ibm will be out about the same time, and as you see, ibm is moving higher towards the close. Estimates there, 5. 25 per share. Around 4 30 eastern time texas instrument will be announcing its earnings. Its coming off those lows and were starting to move higher, back to neutrality. Texas instruments is looking for 37 cents per share. Brian belsky, like any of those stocks . We at bmo upgraded Texas Instruments recently to an outperform rating. Heres the problem with technology, bill, probably the most hated sector when you talk toins tuesdays, the largest sector on the market and most managers are extrapolating the perceived issues with apple on the entire sector. We think thats from a contrarian basis to be very positive and from a fundamental perspective stocks