Fiveyear highs right now. Moving to the upside. Seems as if weve got like a 78point rally going on there on the dow. Moving towards the close. One more hour of trading. All right, everybody. Get on facebook and be sad. Ill see you tomorrow. Closing bell is next. She lip synched the thing . I had no idea. Far more humble pie, come on. Welcome to closing bell. Im Bill Griffith here at the new york stock exchange. Another winning day for stocks so far. They all lip synch. Im michelle carusocabrera. Following another big market move today. The dow and s p 500 on track to close at fresh fiveyear highs and we keep saying that day after day. The dow is within 400 points of an alltime high. Plus, maria is going to be bringing us some cant miss reports out of daffio, including her interview with jamie dimon, and hes all fired up about the heat that the Banking Industry is taking. His comments making waves all over the world. Maria with jamie dimon coming up. Also with us here at the new york stock exchange. The ceo of coach, lou frankfurt. Big miss on earnings. That stock among the worst per formers on the s p 500 which is ironic since lou last year was named the ceo that created the most value for shareholders in 2012. Today hes biggest the biggest decliner among the s ps. Well talk to lou frankfurt coming up in just a few minutes here. And then theres apple. The Earnings Report everyone is watching and waiting for. Some think this could be a watershed moment for the iconic company. Well be doing special coverage when apple reports. Lets show you how the markets are trading. No lip synching here. Dow up 75 points, just off a high that was set a moment ago. Up 79, but, again, getting ever closer to that 14,000 number which we havent seen since december of 2007 and were at about 400 points away from the alltime high which was set in the fall of 70. The s p. The same thing. The dow and the s p, fiveyear highs. The nasdaq, thats up 13 points and theres the s p now very, very close to 1,500. A gain of about three points at this hour. The dow starting to sniff, not just fiveyear high territory, but a few points away from an alltime high. I think i said that. In todays aim sorry. I was lip synching. Michael pento with us and jim bianco of Bianco Research and Robert Zagunis from oregon, jensen management, and thanks so much for joining us. Michael, i have to start with you. Youve been 50 in cash all this time, and we ear setting these highs. Sorry. In january we went almost 90 long in stocks. And enjoying this right up and ill tell you why. Money supply is growing at a 10 annualized rate, up 8. 9 year over year. Where is the money going to go . Not in the bond market. Going to the stock market. The republicans are incapable of embracing austerity. The government is borrowing the feds money into existence, and its driving another bubble in stock prices, what a surprise. All of which were the reasons why you were staying away from the market so now youre throwing in the towel on the political agenda. It wasnt so much driven into investors heads that congress was incapable of embracing austerity. Now we know. Look, the sequestration was supposed to happen january 1st. Punt on that one. Debt ceiling, supposed to hit that. Now it will be steve 19. Theres no austerity. What michael is saying in a very longwinded way is dont fight the fed. Not fighting the fed. The fed, europe, japans now with b to go hog wild. Sure, sure. The whole world is printing new money. Abe, the new Prime Minister of japan, japan is at least discussing a new quantitative easing scheme for them. They are going to be printing a lot of yen. The point is all that tends to be good for assets like stocks . Very stimulative. Europe will have to start printing money as well to deal with their issues so you dont want to fight that liquidity. Earnings dont matter then . Earnings do matter. I think probably revenue will matter a lot more than earnings by the end of 2013. Earnings matter and fundamentals matter but the backdrop is we know what we think may not be relevant or what bernanke thinks is relative, hell keep this a liquid environment for the foreseeable future. Jim bianco, earnings matter. Steves liked to the earnings so far calling them robust. Youre not so impressed though, are you . No. Weve got 3 Earnings Growth maybe for the Fourth Quarter. Estimates are for the Fourth Quarter on a year over year basis of Something Like 2 . 70 of companies have beaten estimates, the average since the end of the Great Recession in 2009. Its 72 . Revenues are growing at around 3 . Thats these are not great numbers. 5 , 6 . Why is the market going higher then . What the other guests have said. Moneyprinting. The fed, the bank of japan. You know, back in july when draghi said whatever it takes, they were the loosest central bank and now they are the tightest central bank and everybody has moved out of them even though they havent changed anything. Moneyprinting matters. Youre right. Once you get past it. I dont see anything in earnings or revenues. What does that mean you do right now . What do you do . You buy stocks or dont you . Buy them on a trade because the market is being pushed higher by easy central bank policy. Thats been the case for the whole recession. You have to buy stocks now. Go ahead, robert. If you take a look at the history of the growth in the United States from 1950 through 1999, the average growth was 3. 6 , Something Like that annualized. Since then its been less than 2 . Now, theres been a little bit of a perk up, but but the direction is positive, and if you start looking at how the businesses and the economy is doing and juxtapose that against the politicians who arent behaving very well, you have to be positive regarding the situation for the future stocks. So you like stocks more for the fundamentals than you do for any fed or congressional action right now. Am i reading that right . Absolutely, absolutely. I mean, for the Third Quarter of last year our stocks had earnings of over 6 which compares very favorable, and, you know, were looking into the future and then we compare that to the general growth rates of the u. S. Economy, and theres no question they are going to outperform so it has an impact. The imf lowered Global Growth numbers today, nobody seems to care because the money has to go some place and its not going into the bond market. Point well taken. In the past you talked about gold. Was that long winded . Were about 15 , 20 in gold right now. Listen, this is a stagflationry environment. Going to get a lot worse. You have to own gold and oil. Be globally diversified and multiasset strategy. Get engaged in security selection, stock research. As we move into the decelerating earnings cycle stock picking will matter. Youve got to be more disciplined in that multiasset. You like health care, consumer discretionary, aclittle defensive with some of your plays. A little bit but leaning a little bit into that cyclical recovery. A 2 , 2. 5 gdp, not a double dip recession in our estimation. Ecb is taking a lot of the current lehmanlike risk out of europe so that means fundamentals can bubble up to the top. Security matters. Let me be clear. Were living on borrowed time here. The government is so stupid not only in europe, japan and the United States, this is what they did. They took all of the debt on the private sector on to the public sectors Balance Sheet. I know. The Central Banks bought all that debt and monetized and guess what they want to do now, the governments want to create inflation, talk about a bubble in bonds waiting to burst. The question is when . Youve got to go short. 2015. Good to sigh, michael. Thank you, gentlemen, for your thoughts on the markets. Appreciate it very much. Apple and netflix set to report, after the bell. The results could be big market movers. Julia boorstin and jon fortt with numbers to watch. Jon, you first. The number for apple is iphone unit sales and the street would be happening with anything above 48 million units. Ite phone is highest marketed product in apples stable so when it outperforms or underperforms it stwings margins and eps pretty high. Other numbers to watch, ipad sales and asiapacific revenue, a decent proxy for emerging Market Growth before we get the china numbers on the call. Julia, what are you looking at with netflix . Jon, the netflix, the number were watching is streaming subscriber numbers. Wall street is expecting 27 million streaming subscribers and 5. 5 million subscribers in the Fourth Quarter. Wall street is projecting growth will be 7 and earnings per share will swing to a loss on Higher International costs. Ill be back after the bell to break down netflixs numbers and tomorrow morning well have our exclusive interview with ceo reed hastings. Bill, back to you. That will be on squawk box and look forward to that tomorrow morning on cnbc. Markets holding on to gains. Near the highs of the day with the dow up 79 points and the s p, what, about three points right now, but both very close to new benchmarks here. Coming up, maria is in davos talking to ubs chairman axel weber and Jpmorgans Jamie Dimon about how the big banks are dealing with the brave new world of more regulations and thinner profit margins. Why isnt jamie wearing an overcoat in. Thats old video. Have retailers have enough of luxury shopping, well talk to ceo lew frankfort and see whats happening in an interview youll see right here only on cnbc. And dont take your eyes off companile. Company set to report earnings at 4 30, all the instant analysis you need right now. Why wouldnt you want to watch us right now . I watch every day. Thank you. With fidelitys new options platform, weve completely integrated every step of the process, making it easier to try filters and strategies. To get a list of equity options. Evaluate them with our p l calculator. And execute faster with our more intuitive trade ticket. Im greg stevens and i helped create fidelitys options platform. Its one more innovative reason serious investors are choosing fidelity. Now get 200 free trades when you open an account. Coach is by far the worst performing stock in the s p 500 today. Shares taking a big hit after holiday revenue numbers for the Second Quarter fell short of wall street forecasts. The stock is off by more than 15, almost 16 . Sales in its biggest market, north america, dropped by 2 , although thats only the Third Quarterly decline they have seen in 11 years, so whats the story behind these numbers . Joining us as he does, were so closed he does on a quarterly base is, on an exclusive basis. Welcome back ceo lew frankfort. Glad to be here. Cut to the chase. Here in north america, womens sales, saw lousy foot traffic in the quarter, didnt you . Thats right. What happened . We were affected by a confluence of factors. First, mall and street traffic was down for everybody. Second, it was a very promotional season, and we did not participate beyond our normal limited level of promotion. So everybody else is discounting, and youre not . Most people are discounting. Okay. In their full price propositions. In addition, we decks appearance intensified competition, especially in our Department Store channel here in the u. S. Can i ask you something . Look, shoppers are so fickle, right . And the fashion world is filled with examples in the past that when a product becomes so ubiquitous people dont want it anymore, right . We can look at fashion icon yves st. Laurent, its why armani never wanted to go public because you have to grow and grow and grow and you get to the point where people are saying everybody else is wearing, that i dont want it anymore. Have you hit that dangerous inflexion point because coach is so pervasive in north america . Nothing in our research or in our experience suggests that thats the case. First were in a very different category than the brands that you mentioned. Were in the accessory category. Its an extremely grand loyal category. Second, we have a very diverse consumer, all ages, all attitudes. We also satisfy a very broad use of functions, and we have different expressions of coach, so we have product thats limited edition, thats only available in flagship stores. We sell many bags of well over 400. In fact, about 15 of our sales this past quarter were was was over 200 while our average bag is less than 300 and some bags are as low as 150. What did you learn from that . I found that interesting. Your higherpriced bags did better than some of the lower price points but yet were in an environment where were told the consumer is only looking for value right now or at least a cheaper price point. I know you can spin value one way or the other. Look. The truth of it is that coach offers an incredibly affordable product for what is in the product and people perceive us as an excellent value. Our products are made out of the best materials, highly well crafted, durable. They last a long time and one of our brand equities is that we do represent a good value so someone can purchase a coach bag at 400, 500 and a like bag from an International Band would be much higher. So what do you have to do this quarter so that we dont see the same kind of deal you saw this last quarter, what changes . Well, first, for context, were an international brand. We have a thriving mens business which is on track to grow by more than 50 this year. Our asian business, International Business was up 12 fueled by china. It was up by more than 40 . Our Digital Business is growing rapidly so we do have many things in place to provide our growth platforms, both in the near term and long term. With regard to north america womens, we are introducing a transformational footwear assortment in over half of our stores. What does that mean, transformational footwear . Weve recently brought in a new designer Merchandising Group to help create a much broader expression of footwear across all usages. Previously weve been largely casual footwear brand, and today our footwear is going to cover day use, weekend play and the like and well market it heavily. You know what caught my attention in your Conference Call with analysts, the word mobile. We hear that more and more among all retailers, and anybody we feel the heat here in television as well. Its not enough to come up with a compelling product. Youve got to work the channels to find the consumer. Absolutely. Where they are doing the shopping, and they are shopping for coach using mobile technology as well. Remarkably, 40 of the consumers who visited us on the internet to look at our fullpriced products came via mobile devices. 40 . Wow, wow. Its more than double last year, even though our sales from these consumers were in the area of 10 to 15 so it helps inform them. They brows and many go to a store but increasingly they buy online. Im going to ask you a political question. Sure. Your fco on the call says a year ago you reported certain items, your tax rate was a lot lower than normal. 12 million. What you did was, she said, was you made actual contributions to charity instead of delivering it to the bottom line and to shareholders. Why did you do that . Was that political . Is that because of this situation right now the way were talking about taxes in america . The short answer is no. We feel a responsibility to return to our community and for everything that they do, and we have created a foundation, and we focus on education. We focus on helping eliminate poverty in america, and we have very structured programs where we match employee gifts, and were proud to save. You dont think the shareholders were angry about that or upset with that, or your first duty isnt to the shareholder . The shareholders would not have received would have received this and would have gone into our cash flow and more generally we have very substantial cash flow. We have no doubt. Were able to invest at the levels we want. Okay. Were in a situation where we are able to return to our communities across america. I should have probably asked this first, but im going ask you as you let it go here. Youre down 15 plus . What do you make of that and say to the Share Holders who have been fleeing today . Would i say its a moment in time and stay tuned. Who is morphicle, a shareholder or a shop cher. I would say shareholders are morphicle than shoppers. All right. Good to see you. Head together close, about 40 minutes left here. Still holding to the gains. The list of groups aposing new york city sugary drinks ban growing by the day. Today a court is hearing arguments about whether the ban is even legal. A live update next. Speaking of sugary drinks, cocacola is underperforming the dow so far this year, but mcdonalds is eating up the competiti competition. Find out which blue chip stock is the better bet for your portfolio coming up in just a moment here. Plus, fireworks on capitol hill today. 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