Jetblue David Neeleman joins us. Lots to speak with him about and his newest project which has nothing to do with airlines. Instead it centers on genetically driven health care. Always interesting with David Neeleman so stay tuned for that one. Apple stock continues to climb after splitting 7 for 1 and there are reports now that could make the 3 billion beats deal make a lot more sense. Is apple about to change the head phone port on its devices so that all older head phones are obsolete . Story is getting a lot of buzz and making a lot of people angry. Well have that story ahead on closing bell. Take a look at the markets. Dow down 13 points for the last several hours. And as we continue to follow the major averages. Theres the nasdaq up about 40 points. Joining our closing bell exchange, weve got monica meta, doug sandler from river front Investment Group and marty from premiere Wealth Management and Kenny Polcari here. Welcome to everybody. Kenny, concerned about markets here, encouraged by them . Has everyone thrown in the towel and say maybe we do get a leg up . I think weve had that leg up. I think the action that were seeing today and the action that we even saw yesterday where the market is churning, right, no reason at the moment for it to push higher. The news is out. The ecb news is out. Waiting for retail numbers on thursday for some further direction but the market just feels tired at the moment. Its got to catch up. Either going to churn here and wait for the data to catch up or by no noens meameans were ng for a big selloff. I was going to ask rob morgan the question is the market tired or simply just taking a breath . Well, rob morgan is not here. Why dont you answer that, kenny. Feels tired to me. Can you feel the last couple of days, theres not a lot of volume. Theres not a lot of excitement. Theres excitement in one sector, m a for sure, but Everything Else kind of teams to be just trudging along, right, as the market churns. Thats exactly what were going to see for a while. Monica, there were a couple of Interesting Development in the data this morning. The first was job openings looked pretty good recently. Small business cementment, both improved and the prices index indicates a little bit of pricing pressure in the pipeline. How do you invest that . How do you if you like this story, how do you think it might be sustainable . Whats an investor to do . I think its telling you various aspect of the economy have a little bit more confidence, but as far as Small Business owners go, confidence doesnt help them grow their business. Money helps them grow their business and liquidity continues to be a big problem for this sector of the economy. You had a story just a few minutes back about housing and how housing prices seemed to have stagnated and when you look at the Small Business community, 28 million Small Business owners in america, its always been hard for them to get mortgages and since january its become even hard we are Income Verification standards so while you may be looking at all of this data thinking there are pockets of opportunity, i think the real crux where job creation comes into Small Business owners, still scratching their head and trying to find liquid tis and money and until we have a solid basis you wont see that engine turning. One of the issues is its hard to find bargains. People dont know where to look. The market has gone up so much that maybe they are afraid to put their toe in the water at these levels. And sometimes youve got to pay reasonable price for a great company, and i think thats the environment were in. Buffet has that great quote where he says id rather buy a company at a fair price than a fair company at a wonderful price. Weve got great Profit Margins and balance sheet. I dont think youll get them cheaper so the economy is just starting to turn. I would note on the Small Business lending that were actual hi starting to see alleged go up as well and banks are always late to react. Were in the early cycle there so theres not a lot not to like. Finish the thought, sorry, doug. The fact that you have to pay a fair price and cant get a bargain anymore that doesnt mean the market wont keep going up. I think youll pay an expensive price one or two years from now and thats what were trying to get ahead of. A point many people have made here market. Kind of relates to what i was going to ask about, but today it looks like weve hit a new alltime low in terms of yield on the junk bond index. I knew would you work that in. Look, i realize its not front and center but it should be because this does tell you something, especially if this rally across stocks, across the credit market, mark, has further to go. Do you think theres froth . Are these companies are we basically propping up Zombie Companies in the u. S. . Is the corporate sub prime, or is it healthy . What do you make of this development . I believe its healthy, and, in fact, i like the high yield muni bond market. The inflows there have reached about 22 consecutive weeks at about 4. 7 billion. So i think rates, yes, are going up rates, coming down, prices going up, but i like fixed income across all categories. Even at these levels, wow. I do, and i think its important and advise my clients to be well diversified with fixed income because we all would agree on this panel and i think you would as well, kelly. There will be a pullback. We see a pullback coming and that pullback could occur sometime this somewhere, somewhere in the range between 5 and 6 , so how do you mitigate risk . You mitigate risk by being well diversified i dont mean to harp on this point, but this is whats so interesting. To some extent youre trying to mitigate a risk thats yet to pan out by going into something that may be riskier because the yields have never been lower and the quality may be deteriorating . Quality is not a is not that much of an issue when youre dealing with your advisors and professional institutional money managers, especially on the mixed income side. They are trained and their analysts know what credit quality looks like so i still think fixed income is a place to be, but i like where were at currently with the equities market, and i see it grinding higher. Kenny, does more money have to come out of bonds for stocks to go higher . I do, absolutely, but it will come out very cautiously. I dont think people will be going all in. I think people remain cautious. Almost feels like that they think theres another shoe to drop and the way they wait the more it gets away were them and then you play catchup which is exactly when i think you shouldnt be running into the market, right . Dont you think some are making headlines for saying that were getting into an area finally of above friend growth. If that really is the case and its sustainable, wont you have a lot of money coming out of fixed income into stocks . I think you will, but what will happen is people will have to wait and be really convinced that thats what they see, right, have to be convinced that the job market is getting bet r better, their own personal situation is Getting Better and the Housing Market is stabilized. This whole housing story coming up, listen, talking about it for a while. Even the town where i live in, the houses are sitting there, not moving at all and theres a lot of them on the market, so until people feel more comfortable youll have this cautiousness. Thanks, everybody. One last word, mark . As you well know thats not the same in the manhattan market. Yeah. You try to locate inventory in the one to three bedroom range and its scarce. Thats not the case in texas either. In texas real estate, particularly residential, still zooming up. Housing is very, very regional. I think thats also very important. What bill was saying here as well. Miss you, bill. Got about 52 minutes to go. Thanks again, everybody, before the close here. The dow gone slightly negative and same for the s p and nasdaq. Feels like yesterday to some extent. Markets under a little bit of pressure. Like almost every day. Even on the days where weve set new highs, slow grind mostly higher. I think theres only been what, i dont know, three down s p down for the third time in a weeks. Yikes. John hatzus says the economy and Housing Markets have turned a corner, what we were talking about a second ago, citing the fastest growth in a pry prity indicator. He makes the case next. Hes sitting or standing right there waiting to walk up on the set. Also coming up, whats really behind Mark Zuckerbergs hiring paypals president. Did you hear this take earlier today on squawk box. Tic a listen. If facebook hires the guy just running it, what does that tell you about facebooks intentions . Hes coming here to do messaging. Really . Are they going to generate a lot of revenue off that, or are they going to be one of three companies thats trying to buy ebay and they just wanted to have the guy running it sitting in the house. That was bill speed, and he will return to make the case. Could zuckerberg now be buying ebay. Plus, doctor in the house. Jetblue founder David Neeleman and his physician discuss analyzing your genetic code to live longer. Not just the stuff of new age pulp and science fiction. Dont miss it and well ask him about jetblues big move into first class. Would he have done that . So what im saying is, people like options. When you take geico, you can call them anytime you feel like saving money. It dont matter, day or night. Use your computer, your smartphone, your tablet, whatever. The point is, you have options. Oh, how convenient. Hey. Crab cakes, what are you looking at . Geico. Fifteen minutes could save you fifteen percent or more on car insurance. Take a look at the major averages. In the red across the board. I was saying to kell before the break, the dow and s p are down for just the third time in the last three weeks. Thats the kind of market its been. Were waiting for dow 17,000 and waiting for s p 2000, and it appears as though well have to wait for yet at least another day. Our next guest had wall street chattering with his bullish outlook on the u. S. Economy. Joining us now. The chief economist at goldman sachs. This was a big call, welcome. Above trend growth for the First Time Since the Great Recession five years ago. Yeah. I think as a statement of where weve been over the last year, when we look at our sort of summery indicator of economic activity, up 2. 7 over the last several months and thats the highest weve seen since the criesies. What happens now . I think we can probably see a little more acceleration from here. I think the main thing is house ing coming back. Activity has been pretty weak and i think that probably comes back as the impact of the big increase in Mortgage Rates last year comes to an end. Youre not getting irrationally exuberant over what may be the snapback from the frozen win the their we all suffered through, are you . Thats always a risk. When you are trying to predict the future that you either irrationally despondent or exuberant but i dont think so because when you focus on the yeartoyear rates in these kind of indicators youre washing out both the weakness during the winter and the snapbacks so i dont think thats really an issue. How important that housing rebounds for all of this to pan out . I dont know if you caught wells fargo at an industry conference with the cfo saying nobody is buying houses right now. We do need some snapback or else i dont think well see much further acceleration from here. I mean, even staying in the sort of high 2s would be better than what weve seen, you know, for most of this recovery, but for further acceleration we probably do need some further improvement from housing, but i would say im reasonably optimistic that housing will recover because i do think changes in Mortgage Rates make a pretty big difference and that impact should be turning a little more positive. What does this moan for the fed and when the fed may raise Interest Rates if the economy is in fact gaining steam a little more than most expected. At the margin it obviously does pull that forward potentially, but i would say its still been fairly close to what weve been expecting, and i think even with this kind of growth i still think its going to be late because theres still quite a lot of slack in the economy. I think the best measure of that is probably not so much the Unemployment Rate but the wage numbers, the fact that wages are still growing 2 in nominal terms if you cut through all the different indicateors. I think its telling you that theres still quite a bit of slack that can late. What does late exit mean, 2015 calendar year or beyond . Early 2016 though late 15 is possible. The risks are a little on the outside but even that would be relative late relative to where we are now. It was suggested yesterday that the fed is behind the curve and the scenario is for an earlier exit than you think. I think theres a more hawkish view on the appropriate Monetary Policy. I think his current view or at least the one that he articulated most recently was early 2015 for the first rake hike. For various reasons i think partly its an issue of how much a decline the Labor Force Participation is structural rather than cyclical and im sure theres lots of other differences as well but clearly has a more hawkish view wonder what the risks are in this whole scenario. Housing has had a nice snapback and maybe prices have risen too fast. Sort of seeing that in various markets across the country. I think on the price side youre right. I would say that the kind of price increases that weve seen which have been double digit on average, i wouldnt expect those to be sustained. They tend to lag a little bit more. Activity has been a little bit weaker and i think well also see a slowdown in house price appreciation but the most important factor for Economic Growth is, you know, how many new homes are we building and what does that moan for residential investment and gdp ultimately . Investors have been caught between two scenarios they see at odds with each oh, one is pimco saying new normal Interest Rates are going to be lower and ben bernanke is out there saying Interest Rates are going to be lower han were used to and you guys seem to take the other view which is, no, you know, things arent quite so different and the tenyear yield will rise back above 3 by the end of this year. Is there a fundamental difference between your reading of the economy and those who believe in this new normal concept . Not so much in the short term i think but but i think in the longer term my view is that while i think the the average shortterm Interest Rate five years out, ten years out i think is probably going to be somewhat lower than it has been historically, i dont think its necessarily going to be dramatically lower. When you look historically at where the funds rate has been in real terms on average, been about 2 . If you look outside the u. S. Or go back further in u. S. History, you also find similar numbers over very long averages, and i dont think were necessarily going to be that far below 2 in in real terms which basically means 4 or thereabouts in follow nal charge. What happens if theres a big pullback in the stock market as we gauge where we are approaching the new highs if theres a correction of some magnitude is there a cause and effect on the economy and could that throw a stone in your growth projection . Thats always a risk. If you get big changes in asset markets, that means financial conditions tighten, downturn in the stock market, widening credit spreads or Something Like that, then you may have to shave something out of the growth forecast. Can be a little frustrating for investors because they dont really appreciate it if economists say, you know, the market just went down a lot and now the Growth Outlook is worse, but that is the reality that these things are hard to forecast what happens to markets and when they do move in surprising ways you do need to take that into account. The wealth effect has an impact on economic spending. What do you think the odds are of the fed doing a surprise rate hike next week . Zero . Ive learned not to say zero about anything but its very, very low. Thanks very much for being here. 40 minutes to go before the bell rings. Dow actually its moving back towards the flat line. Down only three points. Any close positive would be a record close for the dow. Its practically been a reframe of the last couple of weeks. Wild swings in Keurig Green Mountain shares. Well speak with keurigien mountain watchers coming up. And is apple thinking of disc the standard head phone jack, thats the buzz and already creating an uproar. Well talk pros and cons and wait until you hear jetblue founder David Neelemans reaction to his former airline creating a first class cabin and if it strays too far from the original knitting a. Were back in a movement but, manufacturing in the United States means advanced technology. We learned that Technology Allows us to be craft oriented. No ones losing their job. Theres no beer robot that has suddenly chased them out. The technology is actually creating new jobs. Siemens designed and built the right tools and resources to get the job done. First day of my life by bright eyes youre not just looking for a house. Youre looking for a place for your life to happen. The porter was so incredibly. Careful. Careless. 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