Transcripts For CNBC Closing Bell 20130905

Frank blake, weighing in on the housing market, state of the American Consumer and well hear from fdic sheila bair. Find out why she believes yellen is the best join over larry summers. Looking at the dow up about 23 points, almost 24, at 14,954. Nasdaq this morning talking about someone who normally does the morning show up 13 points at 3664. S p, a close eye on the final hour as it is up 4. 5 or so. David koogal, rob wiener, chris rough key from bank of tokyo mitts bushy and our own rick santelli. Thanks for joining us. Great to be here. Today is quiet given the jewish holidays. David do you use this to buy into the market or do you think theres trouble ahead given the events to come. We have plenty of events to come in the next couple months, in september and october with taper talk, the debt ceiling discussions that will go on and what will come about with syria. Hae had an august where a lot of the taper talk has been factored, we think investors can look through points on selloffs that they can add to positions or establish positions because this stock market has further to go on the upside as the market digests and takes in this rise in rates. Ron, what happened today at 10 00 with the ism . Why is the market looking more at the prospect of a taper more than the idea that the economy is grabbing a real head of steam . You go through this every cycle. Interest rates start going up, people get scared. Its good for the economy. They taper if they want to taper. That means its good for the economy. There may be bumps in the road, but the long term is theres a reason theyre cutting tapering. Its because they feel things are better. I dont care what happens for an hour. It seems like things are Getting Better for sure. Ron, last time we spoke, we were talking about the u. S. Verses the international story. Where are you on that at this point . You were firmly in the u. S. Camp at that time. We talked about it off camera. I got beat up pretty good, people saying youve got to be in the emerging markets, its all coming back. So far it looks like the u. S. Is still doing better. However, youre going to be happy with a 24month hold of an emerging market, probably a basket. Too many individual things going on that i dont want to call a country. I think youll also probably do better 24 months in the u. S. And europe. However, europes got a lot of banking issues. A lot of political issues. Its not as easy a bet to us as the u. S. Were still going to stay mostly in the u. S. , but were leaning a little more to foreign markets. Rick, obviously a lot of eyes today on the tenyear as we hover beneath the 3 level. How easy will it be to get there . What happens when we do . I think markets always do what i call the dance when you get to key levels, whether its stocks, the fixed income market. Today what i found interesting, carl, is whether you look at fives, tens, thirties, that once we escalate up toward the higher end of the range, close to 3 for a ten, it stayed in a very tight range, bumping right up against it. My own personal feeling is that the dance isnt going to last long. I think were going to go through 3 like a hot knife through butter. Its interesting you say that. 3 was something i think scared investors and people have been expecting, but not so fast. How were you surprised when we hit 3 given that we havent seen that number, rick, in so long . No, no. We havent closed above it since july 25th of 2011. I personally think that, as our guests pointed out, things are Getting Better. He likes stocks. I dont disagree, but i dont have a gps. Once we start winding down these programs, i think well have a much better sense that with the best ism Service Sector since december of 05, should stocks have been up more . Well, maybe stocks should have been at 12,000. The fed put it up at 15,000. So we dont know. I do think things are improving. The question of how much theyre improving or the sustainability can only be answered when we see the markets for what they really are. Rick, i think your point is that things are improving. And Interest Rates are moving higher for that reason. Absolutely. For the fed to taper and to normalize Monetary Policy as a natural thing to be happening over these next several months. I dont disagree. I think the unnatural thing is that the fed is the 800pound gorilla in the marketplace. I think that chapter needs to be closed, personally. But bonds are not the place to be right now. In fact, ive been on record now about nine months about bond funds. Scary as can be. The easy trade was the bond trade. I think people are stuck about where to go because when they look at their bond funds or bonds every month, its going down. Those are the skittish investors to start with. Thats the levels of the onion that will come off no matter what the data says. You nailed it. Redemptions are going to go up every threshold when they see three, 3. 25. I think its almost an involuntary reaction to whats going on. Chris, we still have to get through tomorrow. Some looking at the Employment Index today in ism and saying it implies 250 or Something Better than 200. Do you think its going to be that good. If it is, do stocks suffer this taper fear again tomorrow . I think stocks will eventually get used to the taper. Its coming. The market tends to discount these things. It is a difficult day to talk about the market because were less than 24 hours away from the most important economic status nick the world, payroll jobs coming out tomorrow. Theres some evidence given the employment part of the services and initial employment claims down at 323,000. It could be something like, if the trend is 200,000, it was 160 below trend last month. Maybe it catches up and does indeed go 240,000 tomorrow. But, boy, theres going its a difficult call right now at this stage. Always a difficult number to guess and make sense of after the fact. David, would it be really weird, almost perverse to have a good number tomorrow, something above 200 and watch stocks sell off . If we go back to good news is bad news, weve been moving into this environment where good news is good news again. I think we expect to taper in september. We think its 10 to 15 billion. Its a matter in how much of treasury verses mortgagebacked securities. Thats where we get started. I think thats what the market is expecting, not that its all priced in, but i would like to see a good number, stocks continue to do well and just a recognition that its time for Monetary Policy. Were beyond the crisis. We move back to a normalized Monetary Policy. Thats a tenyear that continues to move above 3 . There are sectors and there are sectors, not just the market. There are places in the market that even in tapering you can do okay. Real quick, whats the trade as Interest Rates go up. What do you want to own . Technology i think. Theyre an underprize v priced sector. If the world is Getting Better, theyll be cap x. If you pick them all, thats probably the one place and probably a basket. Nobody knows which one is going to make it. In this case instead of an individual stock, id probably go with a bgt or something and play that for a while. Thanks everybody. Appreciate your time. Speaking of the stocks, sheila breaks it down for us. We have some mna action driving todays gains. Louisiana pacific, one of the big winners of the day. That stock up. The price tag 1. 1 billion. Louisiana pacific played a 30 premium. As for why its buying ins worth, more importantly about getting access to asia. If you take a look at ainsworth, about 12 goes to japan. Retail and consumer stocks added to the gains as well. This morning we got august same store sales number. Good news as folks head back to school. One of the big winners, in fact, was costco, up more than 2. 5 on the day august same store sales rose 5 , handily beating expectations. Walgreens was another bright spot, stocks up 1. 5 after august samestore sales also beat expectations. I want to stick with this theme of strong august numbers. We did see how that helped fastenal today. They sell industrial and construction supplies. August sales jumped 2. 5 helping out todays rally. Maria . Sheila, thanks so much. Well check in again. Weve got the final stretch here, a market higher with about 50 minutes before the closing bell. Meantime bit coins could be used for Campaign Donations if supporters win a vote on capitol hill. Isnt the general use of bitcoin being investigated by state governments . Well get to the bottom of this with former president ial candidate howard dean. Dont miss our interview with home depot ceo frank blake. Well find out what hes doing to appeal to female customers and if he regrets the decision to leave china. That and more coming up on that and more coming up on closing bell. [ male announcer ] staying warm and dry has never been our priority. Our priority is, was and always will be serving you, the american people. So we improved Priority Mail flat rate to give you a more reliable way to ship. Now with tracking up to eleven scans, specified delivery dates, and free insurance up to 50 all for the same low rate. [ woman ] we are the United States postal service. [ man ] we are the United States postal service. [ male announcer ] and our priority is you. Go to usps. Com® and try it today. [ male announcer ] and our priority is you. announcer at scottrade, our cexactly how they want. T with scottrades online banking, i get one view of my bank and brokerage accounts with one login. To easily move my money when i need to. Plus, when i call my local scottrade office, i can talk to someone who knows how i trade. Because i dont trade like everybody. I trade like me. Im with scottrade. announcer scottrade. Awarded fivestars from smartmoney magazine. [ male announcer ] some things are designed to draw crowds. Others are designed to leave them behind. The allnew 2014 lexus is. Its your move. Welcome back. Bitcoin a Virtual Currency that continues to grab real headlines. Last month it garnered unwanted attention. New york states top banking regulator issuing more than 20 subpoenas to bitcoin businesses due to concerns about the black market use of bitcoins. Today its back in the news. The federal Election Commission is nearing a decision to allow bitcoins as Campaign Donations. Governor, how would this work given it can fluctuate in value . Well, the fluctuation in value is not an enormous problem if they spent the money in a timely way. You can make some regulations about that so that that shouldnt be the problem. The problem, concern i would love to hear what david has to say about this, the potential for laundering money this way. That is something new york state is looking into. What id mostly be concerned about is using bitcoin as a way to get foreign money into american campaigns which is against the law. Im generally in fave vosh of bitcoins. I think its this is an at stemt by the fec to get ahead of the curve. I want to be really careful we dont make whats already a pretty shaky Campaign Finance regulation thanks to the Supreme Court even more shaky. Thats a great point. David, how do you respond to that . You think its a good thing, right . I think governor dean brings up a good point. Theres a real place for this. Especially the real problems are the soft money loopholes. If you wanted to distort politics, thats how youd turn. I think bit coin is just impractical for largescale manipulations. The only real practical effect is to allow small individual contributors who frankly feel disenfranchised by the current system. I think theres a place for politics as well. This is a good thing to get more people to contribute on small donations. I completely agree this has to be done in a way that anticipates the problems and resolves around them. You think the Election Commission is doing this because they see this as a real possibility, that this is going to happen in time . I dont know why theyre doing it. I was very, very surprised to be honest to get the call of the producer of this show to come on and talk about this so soon. I do believe bitcoins have come a long way in a short period of time. Theres going to be fallout. Theres fallout for the traditional currencies when people try to corner the market in various krern sees which theyve done taking a run at the malaysian ring and things like that. So its not unreasonable to suspect that at some time somebody is going to figure out how to manipulate this market and drive it in certain directions. Market manipulation isnt so much the issue. I would say trying to understand how this sort of impacts the ability for new donors to come to the market who currently feel that, due to sort of buying with a traceable currency, that that puts them on sort of a list for contributing and expressing their political affiliation. I think this is the ageold dilemma is, is Campaign Contribution as corrupting influence or a constitutionally protected free speech . It is definitely a complex issue. The question i have based on what you just said, you really arent supposed to be able to conceal who you are under the minimum Campaign Finance laws we have left after Citizens United basically shredded all that. Does this mean theres going to be less transparency if we use bitkoins and people can go on and make minimum contributions . Some would argue thats a good thing. I think the key goal is to keep large amounts of distorting money out but encouraging small donors, even in a small way is anonymous support. Ive got real problems with anonymous donors. Lets talk about that for a second, governor. David, you have donated to president obamas campaign. Would you do that using bitcoin . I think the goal of this isnt so much to enable people who are open about their affiliations, but recognizing that some people feel uncomfortable. I understand that even if not our goal isnt necessarily to do this just because we support it. Its about supporting those people who cant really support themselves. We asked david if he would contribute in bitcoin. If you were still running, if you were running this fall, would you be accepting bitcoin . Oh, sure. Are you kidding . This is an invention of 23yearolds. 23yearolds came of age in our campaign. It was the First Campaign of this new generation. Of course wed try to figure it out. I would be very uncomfortable taking a lot of anonymous donations. The reason you dont want to make donations anonymously, i think its fair for the public to know who is backing candidates. My great fear is actually that the Koch Brothers would figure out how to give tons of money anonymously and thats the perversion of the system. Thats the real concern right now. Thats where our echl fa sis would be, is identifying and preventing this activity while allowing small, individual donations. Well leave it there. Great analysis. Thanks so much. 40 minutes before the closing bell. Dow is up about 19, 20 points or so. A andp is up 3 1 2 points. Blackberry trying to speed up the sail of the company. Well hear from somebody who says that could speed up a rally in the stock. The nfl season kicks off tonight on nbc. Coming up well get predictions on both the season and the markets from a pair of former nfl players who have taken their skills to the streechlt dont forget to watch Opening Night of nfl tonight, nbc, the super bowl champion ravens take on the broncos. 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. Amelia. Neil and buzz for teaching us that you cant create the future. By clinging to the past. And with that youre history. Instead of looking behind. Delta is looking beyond. 80 thousand of us investing billions. In everything from the best experiences below. To the finest comforts above. Were not simply saluting history. Were making it. Blackberry is a big winner on the street. Seema mody is here to explain why. Blackberry, the struggling phone maker is still on the hunt to find a buyer. Reports indicate it has narrowed down possible bidders which includes canada pen investment more, as well as lenovo. The wall street journal reports theres no guarantee this will materialize into any serious bids. The blackberry is said to be wrapping up the auction process by november. Shares hovering close to the 11 mark. Since blackberry announced that its exploring strategic alternatives, shares have gained 19 . Maria and carl back to you. Is blackberrys for sale sign good for invest. Abigail doolittle with the sea port group. Steve cortez is with vary cues tjm. Steve, lets talk fundamentals first. Are you a buyer or seller . Im a buyer. The only berry hotter than blackberry right now is halle berry. This stock has really been moving lately and for good reason. It got down to fundamentally Intrinsic Value pricing. The patents this Company Holds are worth a conservatively estimated 2. 5 billion. When you throw in the cash and shortterm cash holdings, thats another 2. 5 billion. Thats a market cap of 5 billion. The company is trading just north of there. You essentially get the phone business for free. I think you get in a sense a free call option on anything that does well in the phone business. One thing i would point out about phones, i know theyre losing market share. Those are known knowns. For organizations that really care about security, for instance, u. S. Government, pentagon, blackberry is still the goto phone provider. I think a lot of value here. Abigail, lets talk charts. Im with steve. Im a buyer of blackberry. Blackberry is going higher. When we pull up a threeyear weekly, we see how rough its been for this stock over the last few years. But i love this chart. Why . Its putting in a longterm base. Buyers stepped up to support the stock after the disaster of its last quarter, sending shares toward the top of a trading range. I would say somewhere between 15 and 18. This is a great stock to buy on strength. Again, im a buyer of blackberry, very, very bullish. Does it matter to you, steve, who the buyer uflt matly is . It doesnt. I do think, look, because i think private equity sees Intrinsic Value here, my guess is this company is actually going private rather than being taken over by a private company. Regardless, i think theres a lot of value here. Its a hard company to love. I can see that. It doesnt make money. I used to trade about six times this price. Theres a lot of negatives. Clearly i think theyre more than priced into the stock. I think the risk rewards favors the longs. Thanks to you both. Appreciate your time. In the final stretch, 35 minutes before the closing bell sounds, quiet day here, jewish holiday, up 14. 5 points on the Dow Jones Industrial average. 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Hps Technology Helps us turn millions of tweets, posts and stories into realtime Business Insights that help nascar win with our fans. Welcome back. Students loans are no longer making the ban grade for banks. Kayla tausche on the story. Oh, lets check in with courtney reagan. Thank you very much, maria. In new york city courtroom, jc penney is still fighting with macys over who has the right to sell the Martha Stewart products that are branded at least in certain categories. But the judge hasnt decided on the case even though the case itself has wrapped. There was a case that jc penney ceo mike ullman is dropping ma that stewart products. Though jc penney says its waiting on the judges decision. Martha stewart media says, our agreement with them is in force. We are committed to working with them to design high quality, beautiful and affordable products for consumers around the country. Court proceedings revealed how important the Martha Stewart partnership was to former ceo ron johnson in his home transformation. Current ceo mike ullman expressed disappointment for sales in the revamped Jc Penney Home department. Many analysts think if jc penney does ultimately lose those ma that stewart products by choice or court order, it will have a marginal impact on the bids. Carl . Courtney, thank you to much. Courtney reagan talking jc penney. Walmart is not struggling with any major product lines, but today is dealing with a labor struggle. The nagtions private employer s facing an expanded union president. Rick berman, rick, good afternoon. Hello, carl. How worrisome is it that workers are having these concerns and taking it essenti l essentially to the streets . Most of the people protesting are not the workers. These are people brought in by the union, to rent the mob in some of these cases, where its not the union staff and theyre bringing in Union Members from competitors to walmart. This has been going on for ten years. I remember being on these shows ten years ago talking about walmart watch, wake up walmart. Its the same thing. The big question is why dont these people petition for an election and see whether or not the employees want to unionize. They never want to go that route. Lets face it. The walmart workers say the wages are not enough to survive, to live on. Why shouldnt the largest retailer pay a livable wage to these workers. The question is why does somebody take this job in the first place . They knew what the job was, what the salary was. If people are unhappy with it, they should have applied for a job someplace else. Walmart and a lot of other retailers, theyre not the only ones, are lowcost for the somer and lowwage jobs. These are understood to not be hightech, highpaid jobs. Theres no surprise to the employees working there. In some states, rick, the minimum wage is about 15,000 a year in pay. Thats not a lot of money. I wonder if you, your organization or walmart classifies that as a livable wage. I dont know what a livable wage is because for different people its a different number. There are so many people who are working at the minimum wage who are not the primary wage earner in the family. The average Family Income of a minimum wage income is 53,000 a year. So its clear that most people working at the minimum wage are not sole providers of their family. What happens if the minimum wage goes up . What happens if it goes up . Yes. What youre finding now is that there are more people who cant get a job because companies go to more technology. There are fewer people who are working in these stores than their used to be. Even costco, which is held up as a higher wage employer in some of these retail sectors, cosco brags about the fact that they dont have that many salespeople. But wouldnt it be better its even better for walmart if the minimum wage goes up. Yes, walmart is paying more, but their customers are making more, presumably allowing them to spend more at walmart. Then everybody should be getting 25 an hour and well all be rich. Its silly to be making those arguments, maria, because what youre presuming is everybody can pay whatever the customer is forced to pay. Customers are not forced to pay anything. I wonder, when wu we look at we always look at sg a. Does walmart argue that raising their wages would affect the prices theyre able to sell products snore. I dont know what walmart argues in that regard. I dont work for walmart. I dont represent walmart. But the facts are that most of these retailers theyre all competitive with each other. Most of these retailers are paying people at what you would consider to be a relatively low wage in this economy because these are nonskilled jobs, low skill jobs. Again, if these people are unhappy and i wouldnt necessarily want to be working in those jobs trying to support a family, but i would be looking for a different job that paid more money. All right. Well leave it there. Good to have you on the program. Thanks very much. Thank you. Well get the other side of the story after the short break. Well talk to an employee of walmart to talk about those issues. She was just arrested today. She was arrested because she was protesting. Well be back with that interview. 15 minutes before the closing bell sounds. Meanwhile the market up about five points. Volume on the light side. Well look at whether it could spell big trouble for stocks. After the bell, former fdic chair sheila bair is with us. 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Associates from all across the u. S. We went because of concerns in our store and about the company. We wanted our voices to be heard. They unfortunately did not speak with us. Not only did they not speak with us, but they retaliated against us by firing some of us and by writing some of us up and still harassing others. So we reached out to the board of directors and tried to get them to help us speak with walmart. They also ignored us. So we decided that we were going to go to reach out to him one more time and not take no for an answer. Again, he refused to speak with us. So they arrested us for not leaving. Your main gripe is your salary. Tell us what you do and whats your hourly pay . I make 10 an hour. I stock overnights. I put the freight on the shelf. Ive worked for walmart for 4 1 2 years. Im 45 years old and i cant support myself on that salary. Do you have benefits . I do have some benefits, yes. What are you hoping to accomplish with the strike . You must want to work for walmart for some reason. Otherwise you would have looked for a job elsewhere a long time ago. I work for the largest employer, retailer in the world. As that, i know my company can do so much more, but they choose not to be. They retaliate against us when the associates speak out. And so i hope that they will realize that what theyve done, they will reinstate the fired workers and will take off the coachings to the associates, the unexcused absences and that they will realize with the economy today, that their associates cannot live off of 8. 81 an hour. Were not asking for 20 an hour. Were just asking to be able to support our families. We talked to rick berman. He said why dont they just go work somewhere else. Why havent you just left . This is not a new story. Everybody criticizes walmart for the hourly pay. So how come youre still working there . One, with the unemployment rate, what are you going to do with 1. 4 million associates if we all try to quit. Have you tried to find another job . Yes. The thing is, walmart there are a lot of businesses that follow their business model. So i could leave walmart, yes. But going to work for another company, its going to be the just the same thing because of their influence on other retailers. Do you shop at walmart . Yes, i do. Do you think they have the best prices . For the most part, yes. Does it ever occur to you that maybe the reason the prices are so low is because theyre disciplined about what they pay their workers . Does one thing not feed the other . Yes. Im not really an economist, but yes, to some degree i agree with that. How hardest to get as many hours youd like out of them. If you get 40 hours if you want or can you get overtime . Are they pressuring you to be part time verses full time . Im lucky enough to be full time. However, they do cut our hours on a regular basis. Sometimes i will get 36 hours or 30 hours depending on the time of year. So saying that youre full time is not necessarily a guarantee that youre getting 40 hours unfortunately. Are you afraid that being on television right now with us is going to further worsen your situation at walmart . Well, of course yes, im afraid they might fire me. But again, i really i have faith in walmart. I believe in what sam walton founded his company on, and i think that weve just strayed off of it, and i hope that the waltons would realize that and get back on track. So youre asking for what . You make 10 now. What kind of raise would you like . You say not 20. I would like to make at least povertylevel wages which is 25,000 a year. I think thats fair. Im not asking for anything more than just that. Barbara, thank you for coming in and talking about it. Sorry you had such a tough jail. Glad youre out of jail, Barbara Gertz. Glad youre here and safe. The dow on wall street clinging to gains. We have given up much of the earlier rally. Lets check in with mary thompson. One stock has been a winner all week, jc penney higher again today. A couple other hedge funds taking big stakes in the company today. Stock moving higher on the news that its basically dumping Martha Stewarts line after disappointing sales according to one report. Another stock were keeping watch on, kayden. Price tag there up more than 22 . On the downside, some of the other miners under pressure because of the pressure on gold. It is off just about 4 . Then we end with sprint, the Telecommunications Company going to the junk market, going to be borrowing 6. 5 billion in two different trun chs, one an eightyear, one a tenyear. It will pay Interest Rates of over 7 . The dow clinging to a very, very slight gain right now, up just about four points. Lost almost all the rally. S p less than two points. Still coming up, bond funds flowing into stocks. Well talk about if the market can head higher despite all the global uncertainty. Back in a moment. Has its ups and downs. Seasonal. Doesnt begin to describe it. My cashflow can literally change with the weather. Anything that gives me some breathing room makes a big difference. The plum card from American Express gives your business flexibility. Get 1. 5 discount for paying early, or up to 60 days to pay without interest, or both each month. Im Nelson Gutierrez and im a member of the smarter money. This is what membership is. This is what membership does. Farmers presents fifteen seconds of smart. So you want to drive more safely . Stop eating. Take deep breaths. Avoid bad weather. [ whispers ] get eight hours. [ shouts over music ] turn it down and, of course, talk to farmers. Hi. Hi. We are farmers bum pa dum, bum bum bum bum the dow has made it a slow fade all day long. Krechtly up 1. 5 points after being up much earlier. Ben willis joins us. What went wrong at 10 00, ben . I think toefr all picture is that money is still trying to find the right application inside the market. Im taking a very large picture. Money is still leaving the bond fun on the financial side. The industrials are doing well today which is one of the traditional leaders. Basic materials, but going back to the old school. Youre seeing the telecons and utilities, some of the safe haven stocks being hit. I think the market is still trying to find the right trajectory for a higher end of year. A lot of uncertainties toward end of year. The debt ceiling, obviously the fed tapering as well as the new chairman. How do you navigate these things as a portfolio manager. Chad, what are you doing . Today is a directionless market. What we or doing is moving up the quality spectrum in regard to equities. Were actually, though, bringing in our duration on the bond portfolio because the economy is starting to get to a point where were beginning to escape velocity. That is one direction that were going in. But the market at this Inflection Point could correct. Were looking for about a 4 to 5 correction going intercept and october. What are you doing then . Were selling the small caps, the lowerquality companies. A lot of companies are starting to hit our price target so were raising cash. An investor should probably be more balanced and not overweight equities. We had a nice down payment on the s p in regard to total return in the overall market. You think a correction of 1575 not out of the question on with some of this data looking as it does . Youre at a point where earnings arent getting a good lift. Earns up 2. 5 . Revenues up 1. 5 . Even though were getting a modicum of good numbers in regard to Economic Data as well as overseas, youre not seeing that in the learnings. Valuations are forward looking 15 times multiple. Ben, big jobs number out tomorrow. How do you position yourself . What are you expecting and what do you want to do . Ive been looking into that correction for two months. Weve started that process, and the dow jones was down about 4. 5 . Were getting close to that number, the 15. 50, whatever number you want to pick is where we are. Right now protection, i like to buy the vixes. Other than that, i want to the mlp a very hot topic. Despite carl eye khan. If youre looking to put money to work, you get both the potential of upside year principle but good dividends. The expectation is 175,000. If we get a number around 180,000 jobs, is that good news or does that mean the Federal Reserve begins the tapering . I think the Federal Reserve tapers no matter what the number is, whether its 5 billion or 20 billion that will be the discussion. The market tends to overreact no matter what. Ill expect an overreaction when the taper starts. The numbers themselves, i dont think you can put too much faith in the one number. It will be an indication of trend in the number. There is some chatter that tomorrow could be a blowout if you extrapolate some of the employment indices we saw this week. Youre having a very good trend in regard to employment. It could be a positive 200 k number if you get that bond market well above 3 and its marching towards that 3. 25 number. The Federal Reserve will taper september, october. Thats in the cards. One wants to at this point i think pair back their risk exposure. Weve had a very nice run courtesy of the liquidity wave. So youre also expecting the tapering to begin this month . Absolutely or in october. You give your duration keep the duration five years or less. You want to bring it in and dont want to be a cowboy at this point in time. Ben, where do you see the conviction here . Where do you see the consistent buyers and consistent sellers . Utilities, technology. These are the buyers . Excuse me. Not utilities. The basic materials, the oil and gas, the more traditional Building Blocks of an economy that is improving, albeit we know its slow in its improvement. Were seeing that rotation once again today. Utilities and telecoms are under pressure, basic material, oil and gas, industrials. I have to throw in some of the technology names. Microsoft is just as much industrial as honeywell is. Its part of that whole theory that the World Economy is improving, not anywhere near the trajectory we have seen in previous recoveries, but it is. Thats where were seeing it. Chad, ben, thanks guys. Up next well come back with the closing countdown. After the bell stick around for two big interviews. Home depot chairman and ceo frank blake will be with me telling us whether higher Interest Rates will spur homeowners to remodel or upgrade . Then sheila bair will explain why janet yellen should succeed ben bernanke. Youre watching the closing bell. D always will be serving you, the american people. So we improved Priority Mail flat rate to give you a more reliable way to ship. Now with tracking up to eleven scans, specified delivery dates, and free insurance up to 50 all for the same low rate. 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[ indistinct shouting ] [ male announcer ] time and sales data. Splitsecond stats. [ indistinct shouting ] its so close to the options floor. [ indistinct shouting, bell dinging ]. Youll bust your brain box. All on thinkorswim from td ameritrade. A couple minutes before the bell here t. Dow, the nasdaq everything doing its best to be as flat as it can going into jobs tomorrow. Take a look at hat the dow is doing up 2. 25 points. Nasdaq up 8. 7 or so and the s p about 1. 5. Back with us on the floor, keith bliss from catona company. Directionless, low volume, jewish holiday. It adds up to a bit of a sloppy market today. Not a a lot of volume. What we had with rates moving up, bouncing close to the 3 is pretty good Economic Data. What well do is wait till tomorrow to get the third piece of the trifecta of Economic Data that may push fed policy. I believe they will taper. Well see a good payroll number tomorrow which will drive the decision. Whats the number you worry about in terms of the ten year right now. Is it 3 or is it much higher than that . Its remarkable. 3 is the magic number of what a lot of traders are thinking. Thats still historically a very low number. I think what we see a lot in the equity markets is a kneejerk reaction. It will normalize. 3 is telling us its a pretty good economy. Money will start to come back in. Do you have a sense as to where the pain threshold is for the economy . Is it more like 4, more like 3. 5, 3. 25 . The overall high number is up above seven. If we get 3. 5, 4, people will take note. One thing to be concerned about, you look at the productivity numbers and the what weve got in the cost numbers, still getting a lot of productivity out of the worker but not paying them a lot more. At some point thats going to break because consumers will stop spending as much as they are now. Let me ask you what i asked ben willis, the conviction, the continual buyers and sellers. Where do you see the conviction in this market . Theres not a lot of conviction right now. Any sectors that you see consistent see . It moves back and forth. You see the tenyear move up and you see the sectors that traditionally will pay out when rates are low, like utilities, dividend pairs. I think its really people searching for that direction and waiting for that fed move. I honestly believe that. Well see a directionless market for the next few weeks. Im going to head up to the set for the next hour. We have frank blake, the ceo from home depot. Talk about one stock that can tell you a big mac crow picture. Is the next trade going to be about moving into a caterpillar as opposed to General Mills . So much of the year was about those staples and utilities. Is that trade over for good . I dont think its over for good. Youll have to be nimble and quick. If we get Good Economic Development coming out of not only the u. S. Policy, the emerging sectors, yes, those big construction, industrial and basic material names, they should rally in here in this market. One thing we havent mentioned this afternoon is syria. Were in for a few more days here of essentially vote counting even though we think we may know what the house or smat is going to do. I think the way theyve telegraphed anything theyll do, i think it will be a nonevent for the equities market. Theyve signaled a lot of spanking if you will. We wont go in there in a great way. I dont think the u. S. Getting dragged into a quagmire. Famous last words. If thats the case, i suspect we wont see equity markets react all that worse. Some historians have tried to argue post kosovo, post libya, post somalia, bosnia, the market tended to be higher a month or so out. Thats right. They receive seen were not going to put battalions of troops in there and get involved in the situation. Well go in there, show what we wanted to show and then well get out. An important day. Tomorrow will be a lot more important with the jobs number. Again, stocks took that spill around 10 00 with the ism services number, 58. 6. The estimate was just 55, a sense that the economy here may be gathering a head of steam. Lets send it over to maria and the closing bell. And it is 4 00 on wall street. Do you know where your money is . Welcome back to the closing bell. Im Maria Bartiroma on the floor of the new york stock exchange. This market trying to close higher for a Third Straight session t. Dow jones industrial average up six points at the end of the day, giving up much of an earlier rally, 14,937. Nasdaq up ten points at 3,658. S p finishes at 1,655. Home depot still at the