Transcripts For CNBC Closing Bell 20140207

About 15,700 to be in the green for the week. We are well in that territory right now with this 140point gain. And why are stocks higher with another anemic jobs report . Is the street discounting the number due to the bad weather weve had . Is it betting janet yellen will taper the taper because the economy isnt where it needs to be . Well get a team of top minds making sense of all this including former chair of the White House Council of economic advise errs cris errs christina. And smash burger expanding across the ghuntcountry in a bi. Why they have confidence to grow and create more jobs when others are seeing red flags. Lets recap where we stand as we head into the final hour of trade. The dow up 140 points at 15,771. That leaves it in positive territory for the week. Take a look at the nasdaq, up 60 points to 4117. And finally the s p 500, pretty strong rally adding 20 points. Its now 1,793. So here we go. Final hour of trading in what has been a very volatile week. Joining us in todays closing bell exchange. Eric, ken, paul, and, of course, our own rick santelli. Patti edwards, youre a savvy trader. What is the message of the markets today . Why is it able to mount a rally on such seemingly anemic jobs numbers today . Whats it telling us . You know, i think what people are finally coming down to is the fact that the market actually trades on earnings, and earnings have not been that bad. They have not been phenomenal and we have had some serious missteps, but earnings in general have been pretty good. Were all talking about jobs and the market is thinking about earnings today . You know, the jobs actually do make a difference, but if you look at the underlying numbers in there, manufacturing was up twice what was expected, maybe even a little more than that. And the disappointments were not in areas that you would have expected to see them. So you would have expected that retail would be weak. You would expect that the government would be weak. You would expect that construction would be strong. We saw all that. You know, ken, a lot of people now looking at the action yesterday surprised that were Still Holding up okay today, that it wasnt more of a high bar disappointment kind of story. What do you think is really going on here . I think the market kind of likes the numbers in a weird way that maybe tapering gets pushed off. I recall being on this set the second tradesing ding day of th and i remember how giddy investors were and how quickly it seemed. The sentiment changed from euphoria to worry. To be clear. Youre saying the positive reaction is sort of a bad news phenomena, that its weak and the fed will have to do more. Thats a pretty strong view. At this point theyre kind of discounting a lot going forward. In the end i agree with the other guests that earnings will eke out and thats where people should focus. Is the economy good enough for not good enough . Its right back to that kind of not too hot, not too cold, that kind of goldilocks where were running around that 2. 5 gdp. Maybe with taper it will slow down a tad. Its in that goldilocks environment. Eric, the russell 2000 was near the 10 correction level earlier this week. Now we get this rally. Is the correction over . Is this it for now do you think . Well, i think you have to understand the market coming into this year was a lot more optimistic about the economic environment. I think youll see a lot of volatility based on Economic Data that comes in and disappoints. I dont know if the correction is over, but i suspect that the market tendency is up because of the Strong Economy that were seeing in the u. S. None of the Economic Data we have seen globally is pushing us off of a 3 growth rate in the u. S. , 3. 5 globally. Does that mean the correction has run its course. No way. I think well have a lot more volatility. From a global perspective some countries are actually tapering like the u. S. And brazil, and then youve got japan thats actually loosening. You have got that and then youve got earnings. And earnings actually have been really good to pattis point, but historically Profit Margins are 70 higher than theyve ever been before. Thats not really sustainable over the long term. So i think were going to see a little bit of a churn over the rest of the course of the first half. But that doesnt mean that we cant come out very well from a corporate perspective. But good news is bad news and bad news is good news, so its really you got to kind of flip it on its head. Dani, i am going to pick on you because youre on camera right now. If earnings are that good, then why arent corporations doing more hiring . For a couple reasons. Whats their incentive. The government and legislation has not been there to push it to corporations to invecentivize tm to hire. Theres a lot of reasons why corporations have become more efficient and are holding onto that cash and not hiring like they used to. Want to get paul into this conversation as well. Paul, so what is the verdict from markets today . Are we in a bad news is good news period or not . Because, frankly, it seems like the benefit of the doubt here is what investors are giving this jobs report, giving this market, saying, you know what . Maybe its good enough and not necessarily expecting anything more from the fed. What do you think . I think you have to make a distinction. The economy is doing well. Corporate fundamentals are actually doing well but we have a jobless recovery, and you have to look at three trends. The first trend in joblessness is that as the Unemployment Rate has gone down over the last six months as much because of Labor Participation, people dropping out of the market, as we are growing jobs. And thats going to continue because we have 3 of the population retiring as baby boomers and we only have 1 population growth. The second thing is that we basically have higher productivity. According to Thomson Reuters, we have 9. 2 Earnings Growth for the Fourth Quarter that beats most analysts estimates. So companies are doing really well with fewer workers. And the third trend is we have a government that is putting up barriers to job creation and not giving incentives for job creation. So i think were going to see a continued slow jobless recovery while at the same time the underlying economy is going to do well so what do you do as an investor, paul . Where do you put your money then . I put my money in the stock market. I think we still got a little bit more to go on our correction, but i think this correction was needed and long overdo, and i think there are some real opportunities out there right now. Meanwhile, the dow is up 154 at the high. Rick santelli, have we set it up for you on this one. Is the treasury market the only investment class that actually paid attention to that jobs report this morning . I think so, but i think our panelists gave us a lot of clues as to the problem. The first, the last gentleman said a jobless recovery. Hes right. And then dani hughes said, well, the government doesnt make it easy to hire, but yet theyre both bullish stocks. Here is the problem is that i can understand a jobless recovery and i can understand a globalization process, but we dont need to hire people and still have some companies doing better. But in the end the government is the issue. The government cant deal with all this joblessness and their corrective measures will end up eating through all the dynamics that make it possible to be bullish the stock market under that scenario. The second issue is we have an eye issue, its called blinking. The Supreme Court in germany blinked today, the chinese blinked, and many think the fed is going to blink. That empowers them to continue to think that the punch bowl will not only stay but it might refill. One last thing that doesnt really have anything to do with it but its important, if we look what happened to moodys today, two notches lower on puerto rico. Following s p on the 4th, one notch, both in junk territory. If you look at the etf for munis, it hardly noticed. If you look at a oneyear chart, its hardly noticed, but i think this is going to be an issue to Pay Attention to, and especially for the distressed security guys that are going to be jumping into this to see if they can find some straw to turn into gold. Crazy. They might be, packtti, but what should investors do about the puerto rico issue . I think if youve been in puerto rico you have not been paying attention to the headlines. Puerto rico is unto itself. There are still some we think fantastic bargains in moounicip bonds but know the municipalities had youre buying. Dont just buy the etf. You want to own the individual bonds. Every following indicator is like the january barometer, the super bowl indicator, the afc team won. Im going to go with the groundhog. He didnt see its shadow, six more weeks of a correction. Groundhog didnt see his shadow because he were dropped. Because he couldnt get out of his hole. There was too much snow on the ground. Thank you. Have a great weekend. Everybody watch the olympics. How are you, partner. What a day this has been, huh . Bill, i miss you. You got to get down here. I will get back there. Weve got 50 minutes left in the trading session and look at this. If you just tuned in, you missed the jobs report this morning, and the market is, too. Its up 154 points right now. Good point. Investors are shrugging off a disappointing payrolls figure anyhow. When will bad Economic News go back to being bad news for the market . What is going on here . Well talk about that coming up. Also, well look at whether the market is betting two straight months of weak jobs data will force the fed to taper the taper or blink as rick was suggesting or if the wave of snowstorms across the country is the culprit in making the labor market look worse than it really is. And we want to know how much you think the weather has affected the jobs report. Thats your assignment today. Tweet us with your thoughts coming up. Yes. cnbcclosingbell, thats how it reach us. And next well hear from a company thats hiring a bunch of workers. The ceo of smash burger tells us about whats behind his companys rapid expansion. Make it happen with fidelity active trader pro. Its one more innovative reason serious investors are choosing fidelity. Call or click to open your fidelity account today. Well, if our next guest is concerned about the economy, hes got a funny way of showing it. The fast casual burger joint sm smash burger is planning to open more locations this year. Wi with us now is the ceo, scott crane. Thanks for having me. Can you explain at a time when people say theres no middle class, no middle market in this country, who is your customer and why do they keep coming to smashburger, paying up for your products when theyre potentially under so much pressure . Sure. I think the fast casual segment as a whole is growing as part of the economy. Certainly in the restaurant industry. You see nar ra, were the young, Better Burger category. Where do you stand on pay . Theres a movement in the ku country and mcdonalds is taking a lot of heat. Some folks who are making 8 plus an hour at mcdonalds want 15 an hour and mcdonalds is blanching at that kind of number. Where do you stand . Should you be paying a living wage . Ill let the government decide what the living wage should be. But at smashburger we index ourselves against our competitors and we pay well above minimum wage. One of the issues this week thats been getting a lot of attention is how much the cost of obamacare is affecting companies. I understand you guys have a good bit of a portion of what you do as a franchise model. Talk us through 2014. What kind of increases are you facing if increases at all, and do you have to do things to offset that cost elsewhere . 2014 very minimal, if any, cost increases. We are looking at obviously every business should, what the effects are ongoing and certainly in the next the few outyears. But we look at whether its the offerings we have, were still hiring the right number of employees at every restaurant, and then what can we do with our vendors. The one thing we have an advantage over a lot of companies right now is our growth rate. So each year we get bigger and bigger economies of scale as were adding 70 to 80 restaurants this year. That will certainly help. Costs are going up. Were throwing all these problems at you. Its nothing new to you im sure. Raw material costs are going up. Commodities are going up. Do you have to pass it on to the customer . How do you deal with that right now . Weve kept the same base burger price for seven years. Were seeing such buying power increase exponentially over the years. Youre able to buy at a lower cost because of the amount youre buying right now. Absolutely correct. Who is your typical customer . Very broad. You know, we see the age demography from the teenagers all the way to retired age. We see we have about 50 men and women. Lots and lots of children with children with their families. So its really a broad segment. Burgers being 100 billion category, were only 250 million of that. Weve got a whole lot of white space. We have a huge opportunity in the next several years to get to 500plus. I was just going to say as you do that, im curious, whether the nature of a job as its changing while youre expanding, do you think of hiring in terms of number of employees or do you think of hiring in terms of how do we cover this number of hours and, you know, those might be a lot of parttime positions . Sure. So both. We find the right employee and if that employee is a parttime employee, we have to find more parttime employees. We like fook for the right peop the right positions. We have a great story to tell our employees once we get on board that were adding 2500 jobs in 14, 200 to 500 management jobs and thats a great story to tell and a Great Development path for our team. Weve spent all this time, we havent even had you sell your burger yet. Why smashburger. There are those out west who want to go to in and out burgers, the five guys are doing so hot. Why smashburger. Fat, never frozen, smash cooked to order. Artisan buns. Five cheeses. We serve chicken and salad, hand spun haagendazs shakes. Casual dining in a quicker atmosphere. We serve beer and wine in most locations. The consumers are really telling the industry as a whole midteen digit growth last year in the fast casual segment. Theyre talking with their wallets. Were sorry about the super bowl. Yeah, thanks. That was painful. At least you can tell a better story for denver right now. Yes. Thank you very much. Good to see you this afternoon. Thank you. I appreciate it. Theres one company that is hiring. And, bill, we have 40 minutes to go to the close with the dow staging 145point rally building on the gains, about 180 points, that we saw yesterday. Wiping out the losses from mondays 300point drubbing. That is just incredible over the last five days. Will the real economy please stand up . Youd think this weak jobs report would spark a market selloff. Instead, we are rallying. What is going on with the market. Steve liesman will try to make sense of it coming up here. Also bitcoin prices, a big drop today. They plunged earlier in the day. Now making a reversal. What has sparked the comeback . Well talk about the volatile moves later on the closing bell. Body pain . Back pain . Try bayer back and body. Its bayer aspirin plus a special pain relief booster, to relieve sore backs and soothe aching muscles fast. Get moving again, with bayer back and body. To manage your money. R guy around 2 percent thats not much, you think except its 2 percent every year. Go to e trade and find out how much our advice and guidance costs. Spoiler alert. Its low. Its guidance on your terms not ours. E trade. Less for us, more for you. A 401 k is the most sound way to go. Lets talk asset allocation. Sure. You seem knowledgeable, professional. Would you trust me as your Financial Advisor . I would. I would indeed. Well, lets be clear here. Im actually a dj. [ dance music plays ] [laughs] no way i have no Financial Experience at all. That really is you . If theyre not a cfp pro, you just dont know. Find a certified Financial Planner professional whos thoroughly vetted at letsmakeaplan. Org. Cfp work with the highest standard. So which is the real economy . Please, stand up, somebody. Yet another jobs report skewed by historically severe Winter Weather or was it . Is the u. S. Economy on the right track or not right now . With us to try to answer that allimportant question, jeff kay from bassman sanford rose associates. Dean baker from the center for Economic Policy economic and policy research and our own steve liesman. Its great to see all of you. Jeff, first to you. How does this report square with what youre seeing firsthand . I think its probably a tale of three cities, if you will, or three job markets. If youre a professional, College Degree, youre loving this. Cozy and warm, its 3 unemployment and really full employment for you. On the other hand, if youre not college educated, not Even High School educated, youre closer to 10 unemployment, very different circumstance, and if youre part of this economic longterm structural unemployed, you have been in the cold so long youre kind of numb all those figures did get a little better. It did and shrank that number. Is this one of those reports where the headline really doesnt tell the whole story . I think thats right. And i think there is a little bit of weather in this report and theres a little bit of weakness in this report. And i think both of those things are true. You did have strong growth in the third and Fourth Quarters of last year. That seems to be pretty clear, and its not unusual to have a little bit of a fall off in that as you work off high inventories. On the other hand, there are a couple areas where you might see some you might be seeing some weather effects. For example, maybe in some of the education workers, some of the Furniture Retail workers, and also theres a big drop in Sporting Goods and hobby stores, almost 22,000 down in that retail category. So perhaps that was a little weather related. Unfortunately, bill, the answer is it this or is it that, i have to offer a third answer, it was both. Is it this or is it that, the answer is yes. Its interesting to look at the report which saw the Unemployment Rate dropping for the quote, unquote, right reason. There was an increase in the labor force and yet it still came down. Does this give you more confidence in the health of the labor market . Weve been getting strange numbers. We had a big falloff last month. What happens with the numbers, the Household Survey is very erratic. I think its noise, in other words, i did want to correct that earlier comment about full employment for people with a College Degree. Im old enough to remember before the recession it was 1. 8 unemployment. So they still are seeing a big percentage increase in their own unemployment. Still much better off than people without a College Degree but thats far from full employment. Wait, are you saying that for people with a College Degree, 3 , 3. 5 is not full employment . Thats right. If you look back to before the recession or if you want to go back as far as the late 90s, we were down around 1. 6 , 1. 7 . They have always had much lower Unemployment Rates. We had 4 overall unemployment as a year round average in 2000. You know, kelly, there was a paper presented in philly if i can get an economic wonk hat on bring it on. Theres been a decline in innovation which means there hasnt been as much need for brains how do you know theres been a decline in innovation . Because theres been a huge decline in the spending on innovation. There are some wow products out there, but overall the innovation pace is pretty stagnant and the result of that is College Degree people are taking jobs that used to be held by people without College Degrees and thats pushed them out of the workforce. Its a movement down. Thats interesting. I have had three people tell me just today, a business owner, an economist, and a market trader, all of them said essentially the same thing. That this is the kind of job growth we need to get used to. This is the new normal, jeff. We shouldnt get used to it. Its an unacceptable rate of job growth. I would say this is bad policy. We need something to boost the economy. It could be stimulus if thats out of style which could be on the net export side. We have to boost the economy. The idea weve had bad Economic Policy and say, okay, nothing we can do about that, that shouldnt be acceptable. Jeff . I think it really depends on the industry youre in. I do think the new normal is its been gradual unemployment rebound which who knows, maybe its better than niethese gigan swings were used to. I use a quick example. Apple has 45,000 employees. 30,000 of them are in retail. They got tanked today because of online and the cold. That leaves 15,000. Fox con in china, 3 million. 300,000 just make the iphone 5s. If youre one of the 300,000 in that world, sales, marketing, communications, and all the industry that is support that, construction, energy, Even Financial Services and Health Care Despite some of the regulations, and by the way, recruiting firms and professional services firms, had ep them with those challenges. I think it really depends on what section of the economy youre speaking to and that really dictates it. It kind of gets back to your point which is to this point because there hasnt been pretty much anything happening with fiscal policy or theres been austerity or whatever for the last couple years, its been up to the blunt instrument of Monetary Policy. Are we at a point now where that needs to be shifted into something more targeted towards the industries or the class of people who are suffering most . I have an answer for that. I think you get to a point where, you know, Monetary Policy is helpful but should definitely not be the main tool, especially when you talk about the longterm unemployed who have a real proclivity for dropping out of the workforce and especially now that weve gotten rid of the Unemployment Benefits which makes them now more likely to drop out of the workforce. These are serious fiscal policy issues im betting if you went and told the fed were going to do something to help the longterm unemployed, theyd stand up and say thank you for taking this job away because weve been the only ones concentrating on it. Thats exactly right. Thats what we need. Unfortunately, in washington, its not likely well get it. That is what we need. Id love to see something on the trade side which means getting the dollar down to boost net exports. We have a very bad number this week, two days ago, but thats really what we have to look to to get back to if you look at the japanese yen which has been hammered and that hasnt made that much of a difference in terms of export volumes over the past 5, 10, 15 years. I cant speak that well for japans economy. I think in general you will find that, the relationship, but i certainly could speak for the u. S. Economy. If you look at our nonoil trade deficit against the value of the dollar lag two years you will find a solid relationship you can beat it up anyway you want. Gentlemen, got to go at this point. Thank you all for your insights today. Appreciate it very much. Appreciate it. See you. 30 minutes to go. The dow hanging on to some gains here i think. Yes, it is. Up 150 points. Thank you. Im not down there. And the s p up 22. The nasdaq adding 64 at this hour. Pretty broad based rally. Stocks may be higher today, but the dow is still down 5 so far this year. So are individual investors finding buying opportunities after this pull back . Well hear from a top Td Ameritrade check tiff executive. Investors are pulled more out of emerging markets in january and february than they did in all of 2013. Is there any end in sight to this emerging market meltdown . Coming up. Ow auctioneers make bad Grocery Store clerks . Thatll be 23. 50. Now. 75, 23. 75, hold em. Hey now do i hear 23. 75 . 24 hey 24 dollar, 24 and a quarter, quarter, now half, 24 and a half and. 75 25 now a quarter, hey 26 and a quarter, do you wanna pay now, you wanna do it, 25 and a quarter sold to the man in the khaki jacket geico. Fifteen minutes could save you. Well, you know. Welcome back. So as noted, stocks are in rally mode today despite the weak payrolls report for january. Courtney reagan, which stocks are leading this market higher . Its actually been a pretty good friday. Lets begin though with athena health. The Health Care Software provider reporting better than expected Fourth Quarter earnings and revenue. You can see shares sharply higher there. Expedia hit a record high on the heels of strong quarterly earnings. Other Online Travel agencies rose in sympathy as you might understand. Trip adviser, price lyline and orbitz all up nicely. Twitter rebounding. Up more than 7 , almost 8 at this point. If you recall, investors were spooked by the fact that user growth had slowed, but that was yesterdays concern, not today. Weve moved on. Linkedin plum nettimeting news s quarter projections were lower than expectations. And bit coyne cicoin cited r it looks like down slightly here for the day. Kelly . All right. Court, thanks very much. Were heading into the final stretch here. Bill, 25 minutes left to go. 155 points higher on the dow, and some pretty good signs across the indexes. If it closed right here, wed be up 86 points for the dow this week. Even with that 300point selloff on monday. Who would have thought on monday . Why is this market rallying today . Do investors think the weak jobs data will force the fed to taper the taper . Or are they betting that weather really did hurt the Employment Data and that the labor market is in better shape than these numbers suggest . We want to know how much of an impact do you think the weather had on the jobs report based on your oks, whatbservati whats happening in your neck of the world . Out there. In here. Tdd 18886486021 out there, tdd 18886486021 there are stocks on the move. Tdd 18886486021 in here, streetsmart edge has tdd 18886486021 chart pattern recognition tdd 18886486021 which shows you which ones are bullish or bearish. Tdd 18886486021 now, earn 300 commissionfree online trades. Tdd 18886486021 call 18886486021 tdd 18886486021 or go to schwab. Com trading to learn how. Tdd 18886486021 our trading specialists can tdd 18886486021 help you set up your platform. Tdd 18886486021 because when your tools look the way you want tdd 18886486021 and work the way you think, you can trade at your best. Tdd 18886486021 get it all with no trade minimum. Tdd 18886486021 and only 8. 95 a trade. Tdd 18886486021 open an account and earn 300 commissionfree online trades. Tdd 18886486021 call 18886486021 to learn more. Tdd 18886486021 so you can take charge tdd 18886486021 of your trading. And it feels like your lifeate revolves around your symptoms, ask your gastroenterologist about humira adalimumab. Humira has been proven to work for adults who have tried other medications but still experience the symptoms of moderate to severe crohns disease. In clinical studies, the majority of patients on humira saw significant symptom relief, and many achieved remission. Humira can lower your ability to fight infections, including tuberculosis. Serious, sometimes fatal events, such as infections, lymphoma, or other types of cancer, have happened. Blood, liver and nervous system problems, serious allergic reactions, and new or worsening Heart Failure have occurred. Before starting humira, your doctor should test you for tb. Ask your doctor if you live in or have been to a region where certain fungal infections are common. Tell your doctor if you have had tb, hepatitis b, are prone to infections, or have symptoms such as fever, fatigue, cough, or sores. You should not start humira if you have any kind of infection. Ask your gastroenterologist about humira today. Remission is possible. So if youre just joining us, we had a mixed jobs report this morning, 113,000 new nonfarm payroll jobs. The market though moving higher on the news. Some Market Mavens say investors may be betting on the fed tapering the taper. Others say that maybe theyre dismissing it as an outlier, another one. Can you have two outliers in a row . No, then its just a liar or something. Exactly. Joining us with their take, David Rosenberg and jim bianco. Also joining us, cnbcs very own dominic chu. Great to see all of you. David, you have been notably more bullish on the u. S. Economy of late. Do you change your mind after a couple weak job reports . The answer, kelly, is no. The other question is which report do you want to Pay Attention to . Because there are actually two reports that came out today. There was the nonfarm payroll report report, the plus 113,000, but also the Household Survey which for the second month in a row was a blowout number. That was up 638,000. Although the f jim, do you agree . We had that horrible number in december. We thought the january number is going to help clear things up for us and it just clouded the picture. If youre just looking at the payroll number. Yeah, the payroll number was not good. On top of that, if you look at the report, they also have this thing called persons not working because of bad weather. 262,000. And the average for all of january is 415,000. That was below average right now. So you sum it up and the payroll number is not a good number. Ill disagree with david a little bit in that the household number was good but that diverges all the time from the payroll number. I think this is more about the market maybe hoping that the fed might reconsider on its taper and why not . The fed had restarted after qe1, restarted after qe2. Theyre in the business of caving when it comes to tapering. The market is about to ask the fed for more. Dom, this slight disagreement between the two of them, whether its a strong number or not, depending which part of the report youre talking about, seems to be exactly what the market is struggling with today. But you can say struggle because, yes, there is that kind of debate about whether or not the economic fundamentals justify the market, but the market has been moving higher. Its positive on the week. Its gotten back everything it lost on that steep drop for the dow and s p on monday. John over at marine equity says the bias is to the upside. Could you have had a very, very big downside shock if investors chose to follow through with it. They chose not to. The bulls came right back in. Its a market cliche but the jur jury, the market, says it believes the market should still be headed higher. David, how do you explain the bond market, the treasury markets response . Treasuries moved higher, so it brought the yields down today which would suggest that they saw weakness in the jobs report. Okay. So in like three seconds after the numbers are out, treasury yields rally six, seven basis points and then very quickly they gave up that rally. So were down a couple basis points on the day but reality is from the lowest yield activity on the day, were actually up from there. And, you know,bianco and i are good friends and i respect what he has to say about the number i hear a however. There is a however. The however is basically this, even when you go into the nonfarm payroll number, the goods producing segment, the meat and potatoes, was up 76,000. Doesnt sound like a lot. Thats the goods producing part of the economy. That was the best goods produ producing number weve had in seven years. The real shortfall in the nonfarm payroll number was in services and the Service Number was completely out of line with what we saw with the ism nonmanufacturi nonmanufacturing component. When you look at what drives what, the Service Producing part of the economy follows the goods producers. The Services Service the goods. The goods dont goods the services. So i think the markets are realizing that the Service Sector is going to follow goods producing. Look at the data. You will find when you look at the meat and potatoes part of that nonfarm payroll number, it was not that bad at all. How do you answer your good friend there, jim . David, come on now. We know if we look at a monthly report, we could find good things and we could find bad things. What we have now is we have a huge stock market rally. We have a bond market rally. We have a gold rally, and we dont have the dollar doing much of anything. Thats not consistent with a risk on environment that, oh, the economy is Getting Better, lets reverse what weve done over the last five weeks. We have the stock market reversing. We dont have the rest of the markets reversing. So it is an inconclusive report. It is up in the air right now. Its kind of a rorschach test. Everyone can see into it what they want for the moment and the stock market sees bullishness but the bond market does not. Jim, if i could weigh in, the market did not start to go down in midjanuary because of the fed. The taper was in the market towards the last several weeks of 2013. This was really mostly about the nervousness over emerging markets, maybe some nervousness over the vers aacity of the u. S economy. I know you can focus on the nonfarm payroll number but its the whole report. Its not just one report, its two reports, and its not conclusive that the labor market is really losing steam here. Theres lots of good news beneath the surface of that 113 headline nonfarm number. I will say, guys, newly minted fed chairman janet yellen has one more big jobs report left before she has that first big Rate Decision come march. So, i mean theres another data point. She testifies before Congress Next week. Im sure somebody will ask her about it. I want an encore. Thanks very much. Its an important debate. Gets down to the heart of it right there. Were 15 minutes away from the close. The dow industrials, everybody is rallying today. The industrial average up 163 points right now. Well, she used to be front and center for the white house on past job reports. Coming up, well get christina romers take on todays unemployment figures and what it means for the economy. Dont go anywhere. Re consolidates the ratings of up to 10 independent Research Providers into a single score thats weighted based on how accurate theyve been in the past. Im Howard Spielberg of fidelity investments. The equity summary score is one more innovative reason serious investors are choosing fidelity. Call or click to open your fidelity account today. Afghanistan, in 2009. Orbiting the moon in 1971. [ male announcer ] once its earned, usaa Auto Insurance is often handed down from generation to generation. Because it offers a superior level of protection. And because usaas commitment to serve current and former military members and their families is without equal. Begin your legacy. Get an Auto Insurance quote. Usaa. We know what it means to serve. Heading to the close, we had an anemic jobs report this morning, 113,000 nonfarm payroll jobs created in january. Far below the expectations of 189,000. Decembers very weak number, 74,000 was revised up by 1,000. So, of course, the market would be rallying today. The dow is up 165 points. Or to dave rosenbergs point to the household side of things of that survey looked, bill, pretty good. Or as jim said, its like a rorschach test, you can read into it what you want. Finally here somebody to explain to us why the market is rallying. There he is, david darst. Sir, why, besides the old answer more buyers than sellers, is the market rallying today . Bill, i think, and kelly, you had a snap back in the japanese stock market. This tuesday it fell 4 . People got very nervous, very upset. You have had a very nice calming down in china and in the emerging markets, okay . Turkey, all of these have had a little bit of a bounce. That was one of the things driving the nervousness we were just oversold. We were badly oversold way oversold. This has been a phenomenal reaction to what could have been inpterpreted as bad news. You can parse it whichever way you wish. However, you want to wash two things. They both start with the letter y, yellen and yen, okay . And the yen is basically an indicator of japans continued attempts to cheapen their currency. Can they succeed in that . The consensus is for the inflation, bill and kelly, to be 2 over there this year. The last few years its been negative 0. 1 . Its been in deflation, if they can achieve that, thats a major vactory. You want to watch that. Also, the banks. The banks have been outperforming the market. The market is off 3 , 4 now. The banks are only off a couple percent. In both europe and the United States. Keep your eye on yellen, the yen, the banks, profits. Profits have been coming through pretty good. The revenues not so good. Third quarter was up 2. 9 . Fourth quarter thus far is up only 0. 8 . So you want to watch how the banks do. But our bear market checklist is the economy slowing . No. Is the fed tightening . No. Are valuations stretched . No. Is investor euphoria present . Are banks underperforming . Theyre outperforming. And finally are the spreads widening . No, theyre hanging in there. If people are finally buying this dip, art cashin just said we have Something Like 1 billion of buy orders on the close. Holy cow. Theres money potentially coming into the market. Is the correction over . You want to be careful. This could be weve had a series of mild colds. Nobody has caught the flu. You got to go all the way back to the fall of 2011, which was just after the Standard Poors lowered the debt rating of the United States from aaa to aa plus, and the market fell about 10 from peak to trough in that selloff. We have not had a correction that deep. And we still havent. The dow was down 7 whenever that was. This has been a mild correction. Could we get a more serious correction . Of course we could. But things seem to have calmed down. Finally, europe. The bond yields of greece are now below 8 . Theyre 7. 75 . Spain and italy are 3. 75 , and even the japanese tenyear bond yield is at 0. 62 . I would like to see that one actually a little higher indicating their economy and the inflation is picking up there. So this is basically a period of calm, calm. A bird would sit on the waters to lay its eggs during the six to ten days and these are halcyon days. Will that be on the midterm, professor . I want to wish our u. S. Olympic team at the winter olympics, Jamie Anderson is this slope style skier, keep an eye on jamie and all of her teammates and may they bring home plenty of gold. We wish them well. Indeed. We like to import more gold in this country. Finally, all the men watching the show, if she says dont get me a valentine, she does not mean it, gentlemen. Are you talking about jamie . Everybody. All women hes talking about. Have a good weekend, david. Thank you. Were coming back with a closing countdown for this friday. And are Retail Investors buying back into this market after a rough start to the year . The president of Td Ameritrades Retail Business will be joining us on the closing bell. Keep it right here. Youre watching cnbc, first in business worldwide. We talked about axiron the only underarm low t treatment that can restore t levels to normal in about two weeks in most men. Axiron is not for use in women or anyone younger than 18 or men with prostate or breast cancer. 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 symptoms to your doctor. Tell your doctor about all medical conditions and medications. Serious side effects could include increased risk of prostate cancer, worsening prostate symptoms, decreased sperm count, ankle, feet or body swelling, enlarged or painful breasts, problems breathing while sleeping and blood clots in the legs. Common side effects include skin redness or irritation where applied, increased red blood cell count, headache, diarrhea, vomiting, and increase in psa. Ask your doctor about axiron. Cozy or cool meow or woof . Exactly the way you want it. Until boom your mattress a battleground of thwarted desire. Enter the sleep number bed. An innovative design that lets couples sleep together in individualized comfort. Hes the softy his sleep number setting is 35. Youre the rock, at 60. As your needs change, you can adjust your sleep number bed, so you can sleep better together. The ultimate sleep number event is on now only at a sleep number store. With queen mattresses as low as 599. 99 know better sleep with sleep number. About 3 30 left in the trading session, so what a week. The beginning of the week we thought here we go, were heading to the downside. They were thinking maybe we were heading to a 10 correction in the market was that 300point decline, and then things turned around. A weekly chart of the dow shows where we finished, and we will finish positive for the week after all is said and done. The rallies of the latter part of the week putting us back into the green for that. As for the tenyear treasury for the week, we will be down. Today were yielding 2. 68 . Just about where we started the week as a matter of fact. So it looks like it will be about unchanged there. With us our friend warren myers. Youre watching the constant ebb and flow of this market. What is this market telling us about is it even a comment on the jobs report this morning or not . Ill tell you, i think everyone was anticipating the number and waiting for it to decide what to do and at the end of the day i dont think it meant all that much. I think this Market Reaction we saw on the selloff the last week or so and then that buyback the last few days have been very technical. I think thats what really has been driving this market. Stand by, warren. I have breaking news from the Treasury Department. Eamon javers has that. Were seeing a variety of reports that the treasury secretary has sent some communication to capitol hill saying the debt ceiling the deadline for that was today but now theyre extending into these emergency measures and the question is how long can that last . Reports are now that the treasury secretary is saying those measures can last to february 27th. Not a whole lot of time here. Thats largely because the Treasury Department doesnt have access to the kind of revenue because theyre paying out tax refunds at this time of year. So when the debt ceiling falls at this time of year, theyve got a little less running room than they traditionally have had in the past with the socalled extraordinary measures. Thank you. Warren myers, thats the kind of news that debt ceiling issue again has spooked the market in the past. Its not this time. Whats going on there . I think after the way the republicans finally handled things last time, i think people are finally realizing that partisan politics is not going to be the running course in d. C. And people are going to want to get this thing done, and i think the anticipation and expectation is both sides will come together and resolve this before it gets pushed out too far. Is this market telling us that the correction is over for now again . I believe if you look at it technically, i think its telling you that. Everything im looking at and reading tells me we might be on the precipice of a huge push up, maybe an overextension on the upside and if that happens, thats when you really have to watch out because that might lead into that big correction. So we could be getting close to a blowoff at some point youre talking about. Yeah, we very well could be. The way the market acted this week when we sold off, hit the Technical Levels and had a strong bounce is a strong indication we might pop up to some new highs and thats when you have to be careful. Something to think about. Warren, thanks. Have a good weekend. Thank you. What a week were closing out with. Art cashin mentioning we had 1 billion to buy. A very strong market on the close. What to make of it . Lets do that now. The second hour of the closing bell with kelly evans and company. Have a good weekend, kelly. Ill see you monday. Thank you, bill. And welcome to the second hour of the closing bell on this friday afternoon as we close out a week that started with a massive selloff and now has a nice rally despite a weak payrolls report this morning. Yes, mondays selloff looking like ancient history following the biggest twoday gain on wall street since october. Thats what were just finishing up here. The dow adding 161 points after adding points yesterday. The s p 500 up 23. So weve got rallies of better than 1 again across all three. Lets get straight to it with todays panel. Joining me now to talk about the big rally, the debt ceiling, our very own Morgan Brennan and robert frank, private investor evan newmark and from fast money is tim seymour. Welcome to all of you. And, look, evan, we talked to your credit, from the beginning youre giving me some kelly. You did not love the market. Did not. Do you like it better here . Not really. Basically since we were on a couple weeks ago, not much has happened, although the world did not end with the turkish lira like you claimed it would. I did not its important people understand the risks. I still see the market basically reacting to no news as far as i can tell, the economy is still growing pretty slowly. I dont see why the market should be up so big today, but maybe the market knows something i dont. Car difficudiffcardiff, i th encouraged by the payroll report and we are getting maybe a rally in response to that. Its possible. I think it was a confusing report but if anything it might have given at least some relief that the december jobs report was something of a fluke. That being said, its tough to know what to make of it. Household and Establishment Surveys going in opposite directions again. If you put it in context with all the other Economic Indicators, we came into the year with a lot of enthusiasm. The conditions were in place for better growth. Since then weve had disappointing vehicle sales, durable sales, construction spending, trade, ism. It takes a long time to discern bigger swings in economic momentum. I dont think this report helped that much. That said, nobody really expected it to. So in that sense i guess it did meet expectations. Im a little surprised people are willing to be so long this market going into Janet Yellens first testimony as fed chair next week. Perhaps guessing if anything shes more likely to be reassuring about the feds involvement as opposed to hawkish. Yeah. And i am so the flashbacks today to last year when we had some relatively weak news in the job market being good for the stock market so we were in that kind of bad news is good news territory again where i just start to wonder is the fed still really driving this market . And also if that was the only correction were going to get, which was the end of last week, beginning of this week, a correction is a terrible thing to waste. And we might need more to really get it paus past it. We havent really weaned ourselves off the fed. Yellen will be critical. Tim, by the way, were talking about a 7 i think pink to trough drop in markets. Was that it . Was that the bottom . Has the correction run its course and how relevant is the fed here and the turkish lira by the way . I think its all relevant when you look at some technical factors. Emerging market currencies had blowoff tops. You saw a lot of things settle back in. I think the fed is very relevant. As robert talked about, im disappointed dbad news isnt ba news for the stock market. I think this was very healthy. Look at the shake out in a lot of risk flows and look at the fund flows. When i look at a lot of things that i think people are looking at on this program, look at the bounce at nike at 70. Look at procter gamble. I got to a place where extreme positioning was really what the market was reacting to. Todays labor report not great, but, again, who said that this data wasnt going to be choppy . Yeah, and morgan, theres plenty we can read into it. Cant ignore that earnings season is also happening at the same time. The earnings side of things look okay. If you look at the Thomson Reuters figures, were talking about the best quarter in some time. Yeah, the revenue figure isnt great, but, you know, i guess it goes almost back to the jobs report. You can make of it what you will, but it certainly hasnt derailed the market today. Thats right. Jobs report wasnt as good as analysts were hoping for, but it also wasnt nearly as bad as it was in december. December was only revised up 1,000. Thats not great. Going back to the Household Survey, the fact we saw Labor Participation increase even though ever so slightly and that Unemployment Rate decrease, i think thats extremely promising. The other thing i think thats extremely promising is the fact that we saw a slight decrease in the number of longterm unemployed. I think those are both very hopeful numbers in a very murky report. I dont see has there been any Economic Data over the last few weeks, kelly, that suggests some robust 3. 5 gdp growth per annum recovery . There was a lot in the months leading into the year, so you cant just take a single month im not but im i think if you were to say have we learned anything in the last couple weeks, i think we started out the year thinking its morning in america again and we came off the strongest twoquarter period in the recovery and then wait a minute, maybe its not. Weve worked through it to a maybe it is again . Is that a fair characterization . You dont hear from anybody that things are going really well anywhere. Right. So its a lot of more of the same. Isnt that good for the stock market . I think it might be good for the stock market, but to me and why im a little cautious is, you know what . So twitter lost 20 day, but it still has a 24 billion market cap. People are still paying up for growth. But the market was trading in the Fourth Quarter as if it would be a 3. 5 or better year this year and weve now realized its probably going to be a 3 year. And i think thats the adjustment that everyone has made. Certainly going to be better than last year, but 3 as opp e opposed to 3. 5 . I think its also still really early to take a look because lets not forget, we had two snowstorms here on the east coast alone this week. I was following weather and its Economic Impacts all week in places like iowa and i think its really putting a crimp into the data we are getting out. Thats another thing that investors are not necessarily making big jumps because theyre waiting to see how much of this is weather. A little trickier to tell. Tim talk to us about the Market Action in the last couple days. Massive outflows from emerging markets. Do you think people are deciding that maybe the u. S. Does look like a better place to invest when the rest of the world looks a little more uncertain . I think people are reacting stock by stock, too. Look at the earnings numbers and so people want to say, again, i agree that the market in the Fourth Quarter was trading and things might have been better, but it was stock by stock, sector by sector. A lot of high flying tech names have been destroyed also. Its been on both sides. For every expedia theres a twitter. People are reacting stock by stock. Thats very healthy because the positioning was extreme. Tim in the last couple days i think some normalcy has come back into the sensationalism that was in peoples attitude. You said these tech stocks have been destroyed. Linkedin was down 5 . Is that getting destroyed . Im talking about amazon what im saying is people are judging stock by stock. I would say on the whole theyve all behaved quite while. The chinese internet stocks have come back but you cant tell me people didnt punish amazon with that valuation. They didnt punish twitter with that valuation. Theres some other stocks that are more expensive. A pandora, yelp, these are names people rewarded. I think google surpassed exxon to be the second most valuable company. Google is a different story, a more Mature Company with levers. So your argument so long as some of these tech names are trading on incredibly high priced pes it just looks expensive. You dont get big selloffs of either individual stocks or the market overall on the basis purely of valuation but its hard for me to look and go theres been a correction because linkedin is down 6 or because twitter is down its still over your problem is you cant figure out who is buying today, right . Is that your issue . I want to know who is buying twitter at 54 bucks. Show yourselves. What a bargain. Yeah, what a bargain it is here. But people want growth in a world where back to the point we were saying earlier, the recovery is intact. Were constantly reassured about that but were not necessarily looking around and seeing a lot of top line expansion. Thats true and that will be a problem if it persists. We still have the prospect of less fiscal drag this year. It looks like the deleveraging cycle is still over. The Housing Market is very much likely to be stronger this year than last year. Theres still some good news out there. To pretend we know what the economy is going to do this year after a single month of Economic Indicators i think is crazy. Its still very early. Policy could evolve in a certain way i was going to ask about the debt ceiling in particular. I love how everyone is saying its going to be fine. They cant be that stupid, right . Were saying it again. The debt ceiling was suspended for quite some time with regard to one of the latest deals that resolved the government shutdown. Its now been reinstated. What jack lew is doing is giving us an update on how long the treasury has until it hits the new level until it catches up to the inflation adjusted rate from last time around. I think i made that crystal clear. Its true that the complacency is the biggest threat. The last time we went through it, the market didnt detectably price in any big catastrophe. The most it priced in was a short term selective default. Otherwise, i mean, there was no noticeable pricing in which means there was no spur to action. If we get closer to the end date again, theres a possibility of an accident but i still think its unlikely. Talking about accidents, tim, a lot of people were reluctant to go into the weekend long when they were worried about big currency moves that could come back and hurt markets here. What has changed, especially when you have Something Like puerto rico getting another downgrade. People reminded a little bit about contagion risk that may be underpriced. I cant hear anything. I think we lost tim. I think we lost tim. Is he still talking . Well, well have plenty more of tim coming up in the next hour. Does anyone want to comment on this real quick . I think the contagion thing is a red herring. I think largely a red herring. Would you have said that in 1996 . 1997 . Were you born in 1997 . He was in russia in 1997. And by the way, thats what caused the crisis. We know that now. I think the bigger issue is a question of global growth. And the impact that has on earnings and thats what i would focus on much rather than be distracted by puerto rico. And china is really, you know, the 600 million question here as most all the other things which are a distraction. The china growth story, the shadow banking, whether its a hard landing, thats the issue. Our thanks to tim. You can stick around and catch him coming up on fast money at 5 00 p. M. And in the meantime, has wall streets roller coaster week left investors with a bad case of vertigo . The head of Td Ameritrade retail giving us the pulse of Retail Investors. And whether bad news about the economy is good news for stocks or yes or no. Christina romer speaking with me exclusively in a little bit. Well talk about the employment figures and whether Mother Nature is masking an economic comeback or a slowdown. You are watching cnbc, first in business worldwide. [ male announcer ] the new new york is open. Open to innovation. Open to ambition. Open to bold ideas. Thats why new york has a new plan dozens of tax free zones all across the state. Move here, expand here, or start a new business here and pay no taxes for ten years. Were new york. If theres something that creates more jobs, and grows more businesses. Were open to it. Start a taxfree business at startupny. Com. Bulldog mattress discounters bulldog president s day sale ending . Get a queensize sealy gel memory Foam Mattress for just 497 and get four years interestfree financing on the entire tempurpedic cloud collection. Mattress discounters welcome back. A yoyo week for stocks. Dominic chu recapping the ups an downs for us. Lets talk about this because i have been talking to a number of traders. Its a cliche. Buy the dips. We had a massive selloff on monday but we have managed to on the week get all of those losses back and more and that means that for the year the dow is down about 5 . The nasdaq is down about 1 . The s p is down about 3 . So were climbing back towards that at least positive territory on the year. Now, overall, you take a look at some of the real movers in this particular week, check out some of the home builder and materials related stocks, namely usg. Also vulcan materials. Both having pretty good earnings numbers. Also want to point out here some of the big ones in terms of the leaders in retail financials, housing, airlines. Also on that retail theme, there were some really, really good reports in terms of the overall picture for retail. Check out the shares this week of Companies Like michael kors, gap stores and tiffany. Overall, off market that seems like it wants to rally, and that seems to be the path of least resistanr resistan resistance. Youre going to have hiccups, but overall a nice week recovering for stocks. Never is a straight line, dom. Thank you so much. With such a volatile week, we want to know if investors are pulling money out of the market. Who better to ask than the president of retail distribution at Td Ameritrade, tom bradley. Nice to be here. What can you tell us about how the Retail Investor has reacted to this market . Kelly, i think were seeing investors act in a very calm fashion. Theyre acting intelligently, and we havent seen any hint whatsoever of any kind of a panic. So its completely different from how you might have seen investors react 10, 15 years ago. We noted this actually on monday when we were down 350 points. Everyone was calm around here. We spoke to some brokers saying our phones arent ringing at all. Is this just specific to this market or has something changed with the way that retail guys are investing . I think investors today are much more intelligent than they have been in the past, the distant past, and there are good reasons for that. Number one, there is so much more educational materials out there for investors today. And, for example, on our website, we have hundreds of hours of education material thats available to investors for free and theyre taking advantage of that. Theyre also theres also plenty of technology so investors can very easily access market information, their accounts, and place trades. 12 of our trades today are done on mobile devices. Are they really . I want to bring the panel in with a couple questions as well. I want to know is the best indication that the Retail Investor finally gets it the fact that so much money has gone into passive funds over the past couple years and isnt that basically the best proxy for what Retail Investors are doing nowadays . Well, i think thats an excellent point and a significant amount of dollars have gone into passive funds, but were also seeing individual investors buy stocks. Were also seeing individual investors utilize options. 34 of our transactions now are options are they really . Yes. And individuals are writing cover calls and doing more sophisticated strategies. Some spreads. Some are getting into iron condors and butterfly spreads. Tom, its robert frank. I cover High Net Worth investors and theres a curious thing happening now where theyre accumulating a lot of cash, and if they are investing it, theyre putting a large amount into hard assets, collectibles, were talking about cars, fine art, basically hard things that are tangible and that are not going to be so volatile in price because they just had enough of this market. Do you see any equivalent with the sort of retail mass investor where they want more tangible assets that are going to be less volatile in these markets . Well, we havent really seen any change amongst the extremely wealthy investors. In fact, wealthy investors will always pull money out to put funds into real estate and to invest in their businesses. However, we still see wealthy investors invest in stocks. Regarding cash though, in our Retail Business roughly 20 of our Retail Assets are in cash. 20 . And its been in the low 20s for quite some time. Still some money on the sidelines. Whats normal . What used to be normal during the go go days of the market for cash . Well, the teens would have been quote, unquote, normal if you go back a ways. But the 20 levels, weve been seeing that for the last five to ten years. Wow. I have a question. Out of curiosity, what is the typical profiler of a Retail Investor . What does that look like and has that changed . Yeah. Its a great question. Typically the Retail Investors that were dealing with are the mass affluent. Our average account would be in the 75,000 to 100,000 range. Of course, we have High Net Worth investors and a lot of smaller accounts, typically younger investors that are just getting into the market and beginning to save. Tom, i have got a question because im curious to know how you would reconcile what youd say about retail sophistication and the huge raimoves into etfs particular. Last summer many were following the retail data, and if they were they got an exaggerated, distorted sense of how bad the selloff was in emerging markets. That may be happening again now, but it suggests Retail Investors suggest a lot differently than Institutional Investors and im curious to know how you would square that. I think we have a very interesting retail client base. Its a mix of longterm investors and traders. So you do see a lot of activity as market volatility increases from our trader base, and its very typical to see the traders buying on the dips and selling on the rebounds. So its very common. Well, tom, thank you so much for coming and shedding some light on this situation. It sounds like time will still tell as to whether the Retail Investor gets more involved finally with this market. I hope so. Appreciate it. Thanks, kelly. How much of a speed bump is todays jobs report. Christina romer, the former council of economic advisers chair weighs in next. Well hear what she thinks about the weathers impact on the economy. Plus, shell weigh on on whether the fed should taper the taper. Stake with us. Well be right back. Well be right back. Ha ha. Madeest thou look. So endeth the trick. Hey. Yes. Geico. Fifteen minutes could save you. Well, you know. How did edward jones get so big . Let me just put this away. Could you teach our kids that trick . [ male announcer ] by not acting that way. Its how edward jones makes sense of investing. [ ding ] i sense youve overpacked, your stomach. Try pepto togo. Its peptobismol that fits in your pocket. Relief can be yours, but your peanuts. Are mine. [ squirrel ] its pepto togo. Tgif. Its been another head spinning week for stocks. Courty reagan rounds up the movers. We begin with google which became the second biggest company. Netflix hit a record high that dates back to its ipo in may of 2002. Merck moved higher on news it will pay 100 million to resolve all u. S. Product liability lawsuits involving its contraceptive device. And a strong day for lululemon. Upgraded to upperform saying the worst is over for the retailer. On the flip side Fairway Holdings group, the fresh food retailer, reported weaker than expected Third Quarter results. It announced changes in management. Shares down almost 29 . A big move lower. Thanks. My next guest was chair of the president s council of economic advisers during president obamas first term. In response to todays jobs report, she says the fed should be thinking about how it can be more helpful. Joining us now in an exclusive interview is christina romer, professor of economics at the university of california. Berkeley. Its wonderful to be with you. What do you make of this jobs report . I dont think theres a clear take as to whether the economy is Getting Better or force . I think youre exactly right, and i think thats kind of inherent. Its a complicated report and it didnt give us any clear message. One of the things that is true in this country, as we measure the health of the labor force by two surveys, usually they give us a similar answer. This month they gave us very different answers. The Household Survey showed some real strength, but the payroll or the Establishment Survey, the survey of businesses, was a much more muted report, and i think most economists and certainly most forecasters think the Establishment Survey is more accurate, and so that certainly gives me a sense of caution about todays report. Well, i love that as well because it is the Unemployment Rate that the fed is targeting, and put the 6. 5 number out there, now were so close to that threshold. What do they do, and by they i specifically mean janet yellen, who you vocally supported for this position as chair of the fed. What does she do now . The first thing to say is certainly that the Unemployment Rate is sort of today kind of a uniquely bad indicator of the health the labor market. We know weve had sort of lots of drops in the labor force, not this month but certainly in the previous couple of years, and so its just a very sort of poor and noisy indicator of whats going on in the labor market and probably gives more of a sense of health than is really there. So what does the fed do . I think the big picture is unemployment even with this pretty questionable measure is still well above what anyone thinks is healthy. Inflation is certainly coming down much lower than the fed has said is its target. Its closer to 1 than their target of 2 . I think in that sort of, you know with those two facts, that very much says the fed should be thinking about how do we help the economy, not how do we take back some of the help thats been there. Do you put the onus on the fed because your experience in washington tells you fiscal policy is not going to be an option here . I mean, that is implicitly what i keep thinking. So, of course, we could do a much better fiscal policy. If we did a fis coloncal policy had longterm reduction but more for the economy, maybe an infrastructure program, that would clearly be helpful, that would clearly be smart for the economy. It would be good for groelt in the long run. It would put people back to work now and like everybody, i dont think thats going to happen. And that does leave the federal reserve. Theyre the only game in town, unfortunately. Theyve embarked on this path of tapering and given theyre down that path, it probably would cause a fair amount of consternation if they were to stop or reverse themselves, but thats why i keep saying they need to be thinking about, well, if not that, what else . So do they, for example, change their Forward Guidance . You mentioned they have this, well start thinking about raising the funds rate when we get to 6. 5 unemployment. Well, maybe that number should be lowered to something much more plausible like 6 or even below that. I think that would be a very sensible move. I dont know whats going to happen. Well get a read from chair yellen when she testifies this week. It will be interesting what advice do you have for her . Well, im sure she has many people advising her. You know, i think just sitting where im sitting is to just keep that big picture in your mind, that the economy is failing sort of on both the directions that the fed, you know, cares about, unemployment and inflation, in the direction that says do more. So my main advice would be, be creative. If the fed has decided they dont want to keep with qe3, think of something else. Look at what is going on in the uk. Could you do that in the United States . Could more aggressive Forward Guidance be helpful . I hope somebody is thinking even bigger picture. Do we need a nominal gdp target, some other way of formulating Monetary Policy. The fed should be thinking big, not little, not conservative. You know, professor roam mer but you sound as though you think the taper has been a big mistake. I think its unfortunate. Certainly i think the big mistake was made back in june when they started talking about it the first time. I think once you do that, you know, this all sort of played out as it has. But it certainly was premature at the time. All right. And id love to know when you talk think big, what kind of ideas were talking about. Well have to pick up the discussion another time and leave it there for now as professor christina romer, really appreciate your time this afternoon. Nice to be with you. A different message than were getting from a lot of people certainly here on all street. A shocking statistic or maybe not given the state of things lately. Emerging Market Equity Fund outflows have already surpassed last years and were still in february. Two market pros up next on whether the selling is overdone. Dont go anywhere. Thats why new york has a new plan dozens of tax free zones all across the state. Move here, expand here, or start a new business here and pay no taxes for ten years. Were new york. If theres something that creates more jobs, and grows more businesses. Were open to it. Start a taxfree business at startupny. Com. Make it happen with fidelity active trader pro. Its one more innovative reason serious investors are choosing fidelity. Call or click to open your fidelity account today. Afghanistan, in 2009. Orbiting the moon in 1971. [ male announcer ] once its earned, usaa Auto Insurance is often handed down from generation to generation. Because it offers a superior level of protection. And because usaas commitment to serve current and former military members and their families is without equal. Begin your legacy. Get an Auto Insurance quote. Usaa. We know what it means to serve. Bulldog whats this . Bulldog mattress discounters president s day sale ending . But mattress discounters has the Largest Selection of memory Foam Mattresses under one roof comforpedic, icomfort, optimum. Even a queensize sealy gel memory Foam Mattress for just 497. And wow four years interestfree financing on the entire tempurpedic cloud collection. [yawns] the president s day sale is ending soon. Mattress discounters welcome back. Investors rushing for the exits in emerging markets. See mahmoma mody has the story. Were only five weeks in the year and outflows out of emerging Market Equity Funds have surpassed outflows in all of 2013. 18. 6 billion versus 15. 2 billion according to epfr. The biggest had outflows this week. The reason, continued emerging market volatility. The potential rise in u. S. Interest rates makes u. S. Yields relatively more attractive. Now, the emerging markets continue to underperform u. S. Equities in 2014 and experts say even with calmer trading today, this trend could continue, especially if the fed ramps up its tapering plan. Josh brown says that could result in a larger exodus out of emerging markets. Paul christopher also sees further Downside Risk for emerging markets. Thats why hes recommending clients to reduce exposure to emerging markets as he sees better prospects for u. S. Equities. Seema, thanks very much. Lets talk about these prospects. Joining us chris and daniel rosen, principle at the rhodium group. Great to have you with me along with the panel. Daniel, first to you. China is you know more about this than anyone. Its been closed celebrating the lunar new year. When markets reopen, what kind of concern do you expect them to reflect about how strong and fundamentally strong that economy is . The first thing people are concerned about is that china could get sort of carried away in the general emerging market anxiety right away. Lot of reasons to be worried about emerging markets. Chinas slowdown has nothing to do with it. The fact that things are slowing there is actually pretty good news beyond the very short term. Thats because you think china needs structural reform, correct, and this is effectively the only way to push that . Everybody knows china needs structural reform. They bought a lot of growth in the past through policies which arent working the same way today that they were before. The new leadership has made a very clear commitment theyre going to try to change business as usual. Theyre making down payments on that. Were already starting to see a turn up in terms of stronger Service Sector activity and other little bits of light on the horizon that are going to turn into a much more positive story as the year goes on. Krishna, thats a much more encouraging take than we tend to hear from people opining china is on the verge of complete collapse. Its extremely important for the u. S. , for emerging markets. How precarious is the situation for some ever these smaller economies that depend on chinas growth . Look, i am long term bullish on emerging markets but i think in general there is reason to be concerned that there could be further weakness in the weeks ahead. Why . Theres essentially three things going on that all add up in my view to a derating of these emerging markets. First, as the other guest rightly pointed out, china is altering both its growth level and its growth mix. That is longterm good, shortterm creates risks for the other economies that are related to it. Secondly, were discovering that many of these economies essentially squandered the last few years of easy money globally, just expanded local credit, didnt get the hard work of Structural Reforms done. That leaves them more vulnerable in a tighter financial environment. Thirdly, the fed is moving towards policy normalization, albeit at a very gradual pace. Its not just the level of rates that obviously over time will move higher. Its also the feds risk umbrella. Thats coming in just a little bit. Risk umbrella. Yes. Which is an interesting way to think about it, guys. One question i have for daniel, one of the most amazing and startling things im looking a in the china right now is the leakage of wealth out of that country. More than a half trillion dollars last year by chinese wealthy overseas. 60 of chinese millionaires have either moved overseas or planned to move overseas. Thats a lot of capital leaving that country that may not come back. Does that concern you . A lot of people are talking about that. Were doing a ton of work looking at chinas outbound investment. If you said 60 of wealthy new yorkers had some Assets Overseas from the bbi, nobody would be surpri surprised. But theyre moving. Theyre choosing to start spreading it around a bit. It makes pretty good sense from a portfolio diversification perspective and the bulk of that is by companies setting up productive assets in countries like the United States. Theyre not so worrisome as some people would think. Is there any reason why Retail Investors should be that concerned or focused on anything but china . I mean, we looked at those emerging market outflows, 18 billion. Its a lot of money, but in the scheme, apple bought back 1. 5 billion worth of shares in a couple weeks. In the scheme of the overall Capital Markets and outside of china, should we really be losing any sleep over turkey or some of the other countries . Krishna . Fundamentally i think we have to remember an economy like turkey is not a particularly large part of the global economy. We also must remember that this time around the emerging markets almost all have Floating Exchange rates. That means they can sort of ride out, use the currency as a bit of a shock absorber. It makes it less likely we get this domino effect weve seen in systemic crises in the past. One word of caution, a number of countries corporates have been borrowing aggressively overseas in foreign exchange, in dollar terms such as . This is a case in turkey, a lot of their corporates have currency debt, india, also a lot of corporates have foreign currency debt, sometimes associated with acquisitions, productive assets. And that was what did thailand in is that so many of the corporates in and companies in thailand were borrowing in dollars which is fine when they had a peg. When the peg broke, it all fell apart. So it is similar, isnt it . Its a currency mismatch. It works differently when you have a more continue with Us Exchange Rate movement rather than a peg that holds, holds, holds and then breaks but its still something we need to watch. More of a problem for some of these markets than potentially for here. Guys, thanks very much. Important views on this story as we head into the weekend. Huge pleasure. Thank you. And this years tough winter could be putting job growth on ice. We want to know what you think about this. Tweet us cnbcclosingbell with your thoughts about the labor market, how is the weather affecting jobs. Thats coming up on the air at the end of the show. Up next, David Gregory, moderator of meet the press chiming in on the latest flap sparked by a Congressional Budget Office report. The cbo saying the equivalent of 2. 4 million jobs could disappear because of obamacare. Tdd 18886282419 at schwab, we can help turn inspiration into action tdd 18886282419 boost your trading iq with the help of tdd 18886282419 our live online workshops tdd 18886282419 like identifying market trends. Tdd 18886282419 now, earn 300 commissionfree online trades. Call 18886282419 or go to schwab. Com trading to learn how. Tdd 18886282419 sharpen your instincts with Market Insight from schwab tdd 18886282419 experts like Liz Ann Sonders and randy frederick. Tdd 18886282419 get support and talk through your ideas with our tdd 18886282419 trading specialists. Tdd 18886282419 all with no trade minimum. And only 8. 95 a trade. Tdd 18886282419 open an account and earn 300 commissionfree online trades. Call 18886282419 to learn more. Tdd 18886282419 so you can take charge of your trading. Ive got a nice long life ahead. Big plans. So when i found out medicare doesnt pay all my medical expenses, i got a Medicare Supplement insurance plan. [ male announcer ] if youre eligible for medicare, you may know it only covers about 80 of your part b medical expenses. The rest is up to you. Call now and find out about an aarp Medicare Supplement insurance plan, insured by unitedhealthcare insurance company. Like all standardized Medicare Supplement insurance plans, it could save you in outofpocket medical costs. Call now to request your free decision guide. Ive been with my doctor for 12 years. Now i know ill be able to stick with him. [ male announcer ] youll be able to visit any doctor or hospital that accepts medicare patients. Plus, there are no networks, and virtually no referrals needed. See why millions of people have already enrolled in the only Medicare Supplement insurance plans endorsed by aarp. Dont wait. Call now. So it didnt take long. The Congressional Budget Office released its report on the impact of obamacare on tuesday and attack ads have already hit the air waves charging millions of jobs will be lost. Meet the press moderator David Gregory tracking the political storm and he joins us now from washington. David, this has been ammunition for the gop giving them perhaps even more momentum in a year they think they can make some big gains in the midterm elections. I think one of the things that struck me watching the politics this week in washington is how any glimmer of hope around the state of the union and some cooperation has fallen away and weve gotten right back to Election Year politics. You see it playing out with conservatives on capitol hill and congress. They dont want to talk about immigration even though there may be room to get something done. Theyre likely to back off a debt ceiling fight. They want to talk about health care. And the cbo number talking about the impact when it comes to the labor market, even though there is different interpretations of what the cbo was saying, theres no question there is an impact on the labor market, and while it can be spun different ways, the impact is there. Its so interesting because this was in a report from the cbo, nonpartisan, et cetera, that was otherwise providing an update on how much better the budget sways has gotten which has been one of the strongest selling points of the gop over the last couple years. But that was completely overshadowed by this update on how much weaker Economic Growth will be, bigger the deficit will be because of the equivalent in terms of hours worked, 2. 5 million jobs over the next decade. Why would the cbo be this specific with regard to the impact when they didnt even really cite any reason why their rationale had changed so dramatically . They would tell you they call it as they see it as they begin the analysis on the impact of obamacare. To me it underscores a real problem with obamacare politically. Im talking about the politics here. Republicans and democrats, neither one really understand the impact on the marketplace, what its going to mean for companies, for employees, and for the economy overall, and on the labor force. Now, look, we know what the facts are about the impact on the 2 million jobs. There could be people who stay in a job just to get the health care, they dont have to do that anymore, as well as those who are out of a job who can get health care and thats a big selling point of obama care. But we know the other side of it, too. More parttime workers, less fewer Companies Hiring fulltime employees. Maybe they want to push people into the exchanges in their states or maybe theyre just changing the structure of their health plans in a way that makes it more difficult for consumers or employees. All of these things are happening and having a real impact. And, you know, david, it happens today as the debt ceiling is reinstated, and people up here have been saying, you know what, washington . Were hearing happy talk. It sounds like theyre going to resolve it, its going to be okay, but obamacare and perhaps keystone could play in to gop demands relating to raising that ceiling, could they not . They could. Ive been talking to white house advisers who say the president is still not going to deal. Thats the official position and thats likely to stay. That doesnt mean there arent some measures that they could put in that hes willing to talk about. I dont think keystone is one of them. I dont think he wants to have his hand forced on this just yet. Not abundantly clear why thats the case after the state Department Gave a green light in their report, but i think thats still the case. Look, i dont think republicans want to go to the brink, which we understand will be about february 27th on the debt ceiling from treasury. After the impact that they have felt from shutting down the government and all the blowback over obamacare. I dont think its going to come to that. It doesnt mean there wont be pressure to try to negotiate. Right. And continued discussions about obamacare the more we get reports like this. David, its great to see you. Thank you for your time. Appreciate it. Catch senators Chuck Schumer and rob portman on meet the press this sunday. You can check your local listings for the show time. Now, whats clicking on our website as we ride into the weekend . The hot list is coming up next. Weve been asking what impact do you think weather has on the economy and specifically last months jobs report. Tweet us cnbcclosingbell. Your thoughts on air in just a bit. Metimes life trips us up. Sometimes we trip ourselves up. And although the mistakes may seem to just keep coming at you, so do the solutions. Like multipolicy discounts from Liberty Mutual insurance. Save up to 10 just for combining your auto and home insurance. Call Liberty Mutual insurance at. [ thump ] to speak with an Insurance Expert and ask about all the personalized savings available for when you get married, move into a new house, or add a car to your policy. Personalized coverage and savings. All the things humans need to make our world a little less imperfect. Call. And ask about all the ways you could save. Liberty mutual insurance. Responsibility. Whats your policy . Olets say you pay your tguy around 2 percent to manage your money. Thats not much, you think except its 2 percent every year. Does that make a difference . Search cost of Financial Advisors ouch over time it really adds up. Then go to e trade and find out how much our advice costs. Spoiler alert. Its low. Really . Yes, really. E trade offers Investment Advice and guidance from dedicated professional financial consultants. Its guidance on your terms not ours thats how our system works. E trade. Less for us, more for you. Welcome back. When all is said and done it looks like the up and down week is ending up on an up note, but lets get whats lighting up the hot list. Ben berkowitz joins us from headquarters. Great to see you. Nothing like breaking news on a friday afternoon to stir people up thats what we have today. We have jack lew Warning Congress in afternoon that the debt ceiling is approaching much more quickly than we expected. Hes been saying february some time. We dont know when. Now hes telling congress february 27th is the day. Thats when the money runs out. All right. Tremendous interest in that this afternoon. 170 something tweets already. Really big poll. People are worried about this one. What else . Beyond that, we tried to explain what went wrong or right in the market today. The market was still up 150 points. I love how people are whats the matter, what happened . Good news, bad news, i dont know. Our explanation is more people are working, discouraged workers are getting back into the work force. Its not all bad. The other big one from today, its a really interesting story. Katie little has done a nice piece on the subway. There was a story yesterday about the yoga ruggbber ingredit in their bread and it turns out mcdonalds, arbys, chickfila, a bunch of fast food chains are using that exact same ingredient in the bread. What have the others said about what they are or arent doing in continuing to use the product . Some are saying theyre phasing it out. Some of them are saying nothing, frankly. Yeah. Well, they always try to get by doing nothing. Ben, thank you very much. Have a great weekend. Thanks. I want to ask the panel. This is that youd expect, if this ingredient which is banned in europe and other parts of the country is being used in subway, it is probably being used throughout the Food Industry. First we had pink slime and now we have yoga rubber in our buns. Is in an overreaction . But seriously, people dont realize this ingredient is in all these breads that people make. Just weird. I think this is indicative of a much larger trend we are seeing with consumers and this hes theres the part youre starting to see the nastier, uglier ingredients in our food. This comes on the heels of cheerios phasing out think how heavily regulated the fast Food Industry is. Okay. I dont know anything about the what is it called yoga rubber . Yeah. Not the sicientific. I can assure you if we were going to drop dead from it, we would. Didnt jared lose 100 pounds on that tight . Because of that. The new yoga rubber diet. Just eat the yoga rubber. Yeah. All right. Get the tweets in. We asked how much you think bad weather impacted the jobs report. Your thoughts are coming up next. Would you trust me as your Financial Advisor . I would. I would indeed. Well, lets be clear here. Im actually a dj. [ dance music plays ] [laughs] no way i have no Financial Experience at all. That really is you . If theyre not a cfp pro, you just dont know. Find a certified Financial Planner professional whos thoroughly vetted at letsmakeaplan. Org. Cfp work with the highest standard. Open to innovation. Open to ambition. Open to bold ideas. Thats why new york has a new plan dozens of tax free zones all across the state. Move here, expand here, or start a new business here and pay no taxes for ten years. Were new york. If theres something that creates more jobs, and grows more businesses. Were open to it. Start a taxfree business at startupny. Com. Anbe a name and not a number . Tor scottrade. Ron im never alone with scottrade. I can always call or stop by my local office. Theyre nearby and ready to help. So when i have questions, i can talk to someone who knows exactly how i trade. Because i dont trade like everybody. I trade like me. Thats why im with scottrade. Announcer ranked highest in Investor Satisfaction with selfdirected services by j. D. Power and associates. Welcome back. So we wanted to know how much do you think weather impacted the jobs report today . Danny tweets, 10 . Just a bad economy. How could it not impact it when half the country is at minus 20 degrees. Not much gets done in the housing sector. No, let it be. The economy is on a long and winding road back to recovery. So mixed emotions. But can we talk about subway sand witches . Why do you insist on this . Are we going to talk about the frito sandwich . I think you made an interesting point. Isnt the greater evil the Subway Sandwich with the frito lay chips in it . I dont know if id use the term evil. But as a parent, i would question my sons judgment if he shovelled that in his mouth. Thats different from eating a yoga mat rubber. No, he can have that as much as he wants. But the fritos on the sandwich ill tight back to the jobs report, if they are or ant adding jobs in the cold weather. But when people are going into next week, thinking of janet yellen, shes testifying in front of the fed, why would she be so quick to taper the taper on a couple of reports like this . Well, first of all, we are going to get one more payrolls report before the fomc meeting. But next weeks meeting is from the january meeting so there might be something newsworthy there. My sense is we dont know about much more about the labor market slack and its a useless flesh hold its useless, but the fed is still targeting it. If they consider it, they might consider either lowering it or are you saying, kelly evans, the market may be trying to feel out if yellen will go soft . I think it is. I think people who expect her to go soft, look, im going to say this is not a fed i think that wants its first message out of the gate to be a dovish one. You can go back to the emerging market, this could be people going into u. S. Equities. Guys, thank you for joining me on this friday. Making it a fun one. Its been a crazy week. We want to hand it over to fast money. What do you have going on, melissa lee . Apple exile. We have the ceo of the bitcoin that got gotted from the apple app store. Wow. A lot more. Well, stay tuned. Thanks. Over to you guys. Fast money starts right now. Live from times square, im melissa lee. Im our traders tonight are steve bosso and we are talking to the ceo whose app was banned from the apple store. The top story, the s p scored the best score in the second straight day despite a disappointing jobs report this morning. Is this the end of all that correction talk . Guy, what is that phrase