Welcome to the closing bell. Im kelly evans in for Maria Bartiromo down at the new york stock exchange. And im bill griffith, but apparently i have a new nickname on twitter. The mayor, thats right. I hear that his name around these parts. No idea what that means. Right now were not giving back that 300point rally from yesterday but news from the fed an hour ago right now that some members of the fed would want the free money to come to an end sooner rather than later. That has slowed things down. You can guess where that news hit on this chart right at 2 00 eastern time. A gain became a loss, and were still down about seven points on the industrial average at 13,404. Were going to go over those fed minutes in just a minute. Nasdaq also off the low, down sixplus points at 3105, and the s p 500 index at this hour is down a point and change at 1460. Thats right. Most of this reaction, as bill said, to word that some in the Federal Reserve want to slow down or end the bondbuying program before the 2013. How quickly weve gone from talking about qe infinity to maybe the end of it within the calendar year. The group potentially worried the massive stimulus could have a destabilizing impact on the economy so in todays Closing Bell Exchange steve wood, doug cote from ing investment manager, larry glaze e from mayor flower advisers and our very own rick santelli. Rick, lets kick it off with you. Whats been the reaction in the bond pits . Well, first of all, people on this floor say be careful. A little dissension doesnt break the trio of power as bill gross pointed out, but the movement was fast and furious. We touched a 190 yield. At three and a half month high yields and immediately comped us back to early may we means we have an eightmonth high should we close at 190. Saw gold move down which makes sense because qe is a dollar buster but here traders dont like the program, dont think we need it, dont think its doing a lot of good but they like making money longing s ps, dow futures and their own personal opinion is be careful about drawing hard and fast conclusions on the minutes. If we didnt need this program though, wouldnt the Market Reaction be more positive . Sure. What i think is the fed needs to get out of the way, the sooner the better. They are interfering with the price signal of markets. Arguably in the backdrop of negative fundamentals, the fed is covering up a lot of bad news. The sooner they get out, the sooner we get back to norm a. I think its a good thing so i applaud it. Steve wood, what do you think . Is it time . Could the economy and the markets withstand a phasing out of quantitative easing at this point . I think it really doesnt matter because we know what the fed is going to do. I was at the Bernanke Speech a couple weeks ago. He was very, very clear. Well, first off, hes clear that hes frustrated by politicians in d. C. And secondly they are going to wait for that 6. 5 unemployment level and they will make sure that inflation is in check. After that has been accomplished, they are going to wait and see, so fiscal policy will be accommodative after they achieve their goals so i think thats the environment we have to invest in for the foreseeable future. Not there on the unemployment number, not even clear. I want to bring layery in here. Whats your take. Is the market overreacting . Right, well, i dont think the market is overreacting. I think this is a reminder of why we shouldnt get too giddy after a big twoday equity market rally because any number of things can set the market off in another direction. Never mind the dysfunction in washington that will return and when it does so will volatility. Change in fed policy not just bad for the bond market. Utilities and dividends have been driving a lot of investors thirst for income. Very sensitive to higher Interest Rates so a change this policy is something that could be a game georges bank changer. Need to be very findful how we tread around this. Lets bring in economic reporter Steve Liesman who has the day off but is doing what he loves to do, poring over fed minutes while his family waits for him. Are we are we taking this out of context . Are we getting this right, the market feerk that aring that we to see an end of quantitative easing sooner or later. Maybe just a little bit, bill. Okay. Let me go back and explain. Remember, there have always been two different criteria in the fed statement. The first one is the 6. 5 Unemployment Rate relates to raising Interest Rates. The second one is the quantitative easing which the fed has said if the outlook for later market does not improve substantially, the committee will continue essentially with quantitative easing, so what youre picking up here essentially is a disagreement in the first order its about qe. Thats what the market cares about, but ultimately its about improvement in the labor market, and what youre picking up here is a disagreement over some in the committee are clearly saying they believe the labor market will improv somewhere around the middle 2013 to the point where they will feel comfortable backing off on quantitative easing. This uncertainty was always out there. We tried to push the chairman into explaining the criteria of what was going on and why they would why they would end qe, but they havent done it. Steve, if anything, that means that the real event is tomorrows jobs report. A very important event is tomorrows jobs report, kelly, youre right. The key tomorrow is going to be watching the decline of the Unemployment Rate, and what trajectory the fed feels like its on as a result. If i could, another key event is going to be the news from st. Louis around 1 00. That will be very important because well get his feel what is the unemployment number going to tell us . Remember, theres a lot of people on the fed that feel like an improving jobs market will cause the Unemployment Rate to rise because it will bring back in discouraged workers. Let me push back a little bit here. Go ahead, rick. You know what . I dont think anybody, including the fed, and i think they said it in the press conference, believes that 2013 were going to get down to 6. 5 . Right. So im not sure. Listen, im not buying into the notion that rick, youre right about that. Rick, i was just looking at the at the expectations on the fed. You are correct. There are very few theres a huge amount of anxiety that when the exit doesnt end well, and theres a lot of focus on the fed members, they are rethinking a 4 trillion balance sheet. Rick, youre making the mistake. 6. 5 was never the trigger for question. It never was. That was my first question. The 6. 5 is the trigger for Interest Rates, not for qe. Right. Its the trigger for the trigger. Im glad they made that all so transparent and clear for most of us. Thats why youre gainfully employed, rick. Listen, steve. They are getting nervous about all the buying. Thats the reality and members on the floor are sympathetic to that, but they still dont see it ending significantly sooner. Another year at best. Lets talk very quickly about expectations for the jobs number tomorrow. Doug cote, some of the tea leaves this week had shown that maybe were going to get a decent report, and some on the street have been raising their estimates for what kind of job growth well get for december. What are your expectations . I agree. I think well have a positive surprise. Hey, we had a great adp report today, 215,000. I think initially it will be much better than expected and on the lower end, and i think the Unemployment Rate is actually artificially high. I think we have good numbers and we could get a nice big boost. Look at housing. Look at whats going on in energy. Look at our trade exports are at the highest level. Retail sales at the highest level. I think the consumer is the gamechanger that will boost a lot of this unexpected employment. Just want to go to bill, bill just jump in here. I disagree. I think theres been damage done because of the psychology related to the fiscal cliff that weve seen leading up to the end of the year. A lot of Small Businesses really held back and you might see that play out in tomorrows jobs report. Certainly did see it in the Consumer Behavior with mixed retail sales. Youll see some impact, and name pact will continue over the next 60 days and will come back with a vigor as washington comes back so i dont know that were its all rosy and champagne corks for the new year. I think weve got tough sledding to work through, including in the jobs report. We did see the chicago fed Employment Index dropped ten points, an indication that at least there has been a confidence drop. There will be a lot of choppy data. Had the storm last fall, how weve got the fiscal cliff. Theres a lot of Business Investment and Consumer Behavior that didnt happen in the last two quarters of 2012 which is going to ripple into 2013, but that said, were looking for a stabilizing economy. No great shakes but low to mid 2 . Inflation is probably in check, and i think perhaps from a longer term perspective the Federal Reserve is going to move from a qe regime probably end of 2015, but after that youre still going to be looking at historically very low Interest Rates so the outlook for Interest RatesGoing Forward is going to be extremely accommodative for a good long while. A ways to go there. Steve liesman, last thought to you. Rick is absolutely right. There is no fed member predicting a 6. 5 employment rate in 2013, even very few into 2014 so thats the first thing. The second thing is we have to push bernanke. Bernanke and the fed have to come forward and give us a better metric for what will keep qe in place. What does substantial improve in the in the labor market mean. Its clear that the market is very ses sucseptibeptembe su now. Do i believe that the bulk of the board is in favor of keeping qe in place for the bulk of this year. Hardly a huge selloff with this word out today, but, steve, thanks for stepping back in. Gentlemen, thank you all for your thoughts. Well see you later as well. Now lets get out to bob pins who rode the wave of yesterdays rally and was on the floor when the fed hit news about an hour ago. Whats reaction . Lets take a look at dow. Look, this has been a great day for the market. Very quiet digestion on the big gains yesterday, a little bit on either side of positive or negative is really good and the fed minutes havent change that had picture, kelly. We lost 40 or 50 points as we got the minutes out and some were talking about ending asset purchases stopping purchases for the end of 2013, but only 40 or 50 points. Weve moved sideways since that. What did happen is we got a move up in the dollar. Take a look at the dollar, and that caused a little bit of flouriying in certain parts of the stock market. Theres the dollar index. Did move up on the dollar, believe it or not that caused commodities, of course, to move. Take a look at gold and we did see some movement in gold and commodities to the downside. Big material names moved down because a lot of these stocks, of course, affected by any change in commodity pricing as u. S. Steel is moving to the downside. By and large though i maintain either side a positive or negative today. Take a look at the major sectors. Not a lot of big movements here, and thats good news when you want to consolidate all the gains. On a separate note. There was a slowdown in a couple of feeds that nasdaq put out that affected the pricing for nasdaq stocks here. Thats been resolved, but it did result in stale quotes for a while. Thats been resolved. Gold stocks sharply lower following the release of those fed minutes. Jackie dangelis has details on that. We started the session with gold lower on dollar strength, but the release of the December Fomc minutes pushing the gold higher as well as gold stocks much higher. Federal reserve policymakers expressed broad support last month for the feds plan to buy bonds but differed over the time period. Also remember gold is a noninterestbearing assets. If rates were to rise, then other Asset Classes would be preferred. Take a look at some of these stocks today. Gold corp getting hit and also the gld taking a hit. Bill . Jackie, thank you very much. So, here we go. Last hour of the trading day. Lets see what the market has in store for us this time. Weve got about 15 minutes to go, and the dow is down 20 points. Thats right. Yesterday this was about the time the rally really kicked into gear. Well see how markets move today, but up next we have a new congress, but the battle lines remain the same. Well talk to one lawmaker about the next big fight on the hit barreling towards us, yes, the debt ceiling, and this one could hit the market hard. Then its the better of the value menus. Windys is making a move that did not work for mcdonalds. Will it be any different this time, and which Fast Food Company is healthier for your portfolio . Well look at the charts coming up. And after the bell, gap is making a big bet on luxury that. Stop is up more than 70 over the past year. Does this move put those gains at risk . All that and much more coming up on the most important hour of the trading day. [ male announcer ] how could a luminous protein in jellyfish, impact Life Expectancy in the u. S. , real estate in hong kong, and the optics industry in germany . At t. Rowe price, we understand the connections of a complex, global economy. Its just one reason over 75 of our mutual funds beat their 10year lipper average. T. Rowe price. Invest with confidence. Request a prospectus or summary prospectus with investment information, risks, fees and expenses to read and consider carefully before investing. A day of tradition and pageantry in washington today. 1913th congress was sworn n. John boehner retained his speakership, and while the fiscal cliff in its original form may be in the rear view mirror, lawmakers still have some very big issues to work out. Our Hampton Pearson is following all the action for us. Hampton . Reporter how you doing, bill in the opening 16913th congress featuring all eyes on the incoming house of representatives. 233 republicans, 200 democrats. As you mentioned, and as expected, ohios john boehner was elected to a second term as speaker of the house turning the page from a congress that just barely averted the fiscal cliff to a challenge to his fellow members to take on the dual challenges of too much debt and too few jobs. Our government has built up too much debt. Our economy is not producing enough jobs, and these are not separate problems. At 16 trillion and rising, our National Debt is draining Free Enterprise and weakening the ship of state. Reporter now heres a by the numbers look at the makeup of both houses of the new congress. 12 new source, including eight democrats and 3 republicans and an independent, 8 it now husband members, 47 democrats, 35 republicans, and 81 of those 435 house members will be women. Now after the inauguration in two weeks this, congress will be tested right away doing battle with the white house over the debt limit and then on to those spending cuts. Back to you guys. All right, hampton, thank you very much. The battle lines are already being drawn for the upcoming debt limit debate. Heres what Senate Minority leader Mitch Mcconnell had to say in an oped piece on yahoo . No idea they had oped pieces on yahoo . Heres what he wrote. The president is already claiming that his tax hike on the rich isnt enough. I have news for him, says the senator, it was the last word on taxes. That debate is over. Now the conversation turns to cutting spending on the Government Programs that are the real source of the nations fiscal imbalance, and the upcoming debate he continues on the debt limit is the perfect time to have that discussion that. From Mitch Mcconnell. Discussion, yes. Yes. Just how will this play out. Representative mo brooks is a republican from alabama who voted against the fiscal cliff deal and jim necessariel is a former republican representative from iowa and the former director of office of management and budget and now president and c. O. O. Of growth energy. How do you do all those things . Good afternoon, gentlemen. I imagine you share Mitch Mcconnells sentiment here of no more taxes, but would you at least make more concessions if it meant true entitlement reform . I dont have any reservations about the no new taxes of what needs to be done. Higher taxes hurt the economy. The more you hurt the economy, the less Economic Activity there is. Fewer money being generated, lower taxes, so the solution to this is to grow the economy on the one hand or to have very significant spending cuts on the other. I agree with senator Mitch Mcconnell. If the president of the United States wants to talk about tax increases, look it up in the history books because its not coming during 1913th session of the United States congress. How significant are the spending cuts that youre talking about . What would it take to get to you raise the debt ceiling . Two things that would have to occur, either one of which would cause me to raise the debt ceiling, one is a balanced budget constitutional amendment phased in over a period of time that would force washington to deal with this issue in a serious way. And the alternative, there would have to be spending cuts, real spending cuts, first year in excess of 100 billion. 100 billion. Okay. Constitutional amendment in a long time. Jim newsel, you called the fiscal cliff deal to this point a fiasco. What had your High Expectations for whats to come on the spending and the debt limit that they have to deal with in