Pressure we saw on the dow all morning has leavitted. The industrial average is up 25 points, although the nasdaq struggling to stay positive. Early selling gave way to some buying in the afternoon, once again. Yeah. An upanddown day and a big week for economic news. We have the jobs report on friday. Before that, on wednesday, we get fed day. Amid word of growing descent among hawkish members of Janet Yellens gang. Well talk about that with jim grant in a little bit. Plus, the tax inversion debate continues, the talk from washington to wall street. The president has upped the ante in his campaign to stop u. S. Companies from moving out of the country to save on taxes. This has a former treasury official now saying that the president , if he wanted to, could tie the hands of these companies with a single stroke of the pen. Is that true . And if it were, wouldnt president obama actually be doing that . Were going to get to both sides of that very interesting twist in the story, coming up here. Yes. And as mentioned, the dow is now about 25 points, still shy of the 17,000 mark that it has punched through this year. The nasdaq up about a point, the s p 500 up about two, right at the 1,980 mark, as people are sorting through the news flow, micro and macro, to figure out what the next move is here. Lets talk about all that, shall we . Its our Closing Bell Exchange with Peter Anderson from Congress Wealth management, cnbc contributor Richard Bernstein from Richard Bernstein advisors. Weve got jason pride from glen immediate, kim forrest from fort pitt capital group, and our own Rick Santelli joining us as well. Rich bernstein, i know youre a big bull in this market, and you know, this seems to be the typical teflon market right now, geopolitics, the earnings, all the other things that have been out there lately are not stopping this market, is it . Well, i think, bill, we have to kind of look at the backdrop here, sentiment. You know, the secular sentiment, forget the reports that come out every week, but the secular backdrop, people remain extraordinarily cautious. Right. And thats why this market appears to be teflon, because people already defensively positioned for the most part. So, you have to have something thats worse than what people are already expecting. I dont think were going to see that. Do you think gdp could qualify . There is talk out there after the negative First Quarter, the Second Quarter isnt looking all that great either. Granted, its a little bit of history now, but could that be the bad news youre referring to . Well, kelly, i would say yes. I mean, in the shortterm, the gdp report could have an impact positively or negatively, but remember, whats more important than gdp is corporate profits. The reporting period right now is coming in at least reasonably well, one would have to argue. So, i would say over the next three, six months, its earnings that are much more important than just gdp. And we just put up a chart there i want to show people. This goes back to the discussion on friday, talking with bob pisani about the growth rate. I said i thought the firstquarter growth had actually been much stronger than what it shook out to. You can see on your screen, it was 3. 4 . Now were on track for 8. 3 growth in the Second Quarter. You take the financials out of that, and were actually looking at about 10 . You hit that 10 that rich peterson was talking about on friday. Peter anderson, what are you doing in this market right now . Are you still buying at these levels . Well, you know, i run a pretty concentrated portfolio of about 21 stocks right now, and just prior to this segment, i just checked again, and more than half of those stocks are trading at valuations that are very attractive. You know, when you look at a peg ratio, for instance, half of those names are trading at a peg of about one. So, to me, bill, that says theres still legs left in this market. Peg being . Peg being, you know, the price earnings to earnings growth. Peg legs. That ratio, all right . It does have peg legs, in other words, those stocks do, yes. [ laughter ] you coined a new phrase, kelly. I like that. Cant resist. So, kim, what about you . I see youre expressing some concern still about what happened with ipad sales and that Apple Earnings report. Read through here for the broader tech sector. Well, the ipad is kind of a weird case here. Its used a lot in business, but its also used a lot in just regular consumers. So, its unclear whats happening there. But i did look at the deal between ibm and apple, and i still think ibms going to get more traction out of that announcement than apple will. But it does look like apple is probably more than happy to get that announcement and maybe drag some more sales in from large corporations buying into their device. Are you saying youd buy ibm but not apple here . Yeah, i think thats what im saying, especially for the long haul. Ibm is able to entrench itself into institutions in a myriad of ways. And its still apple is not that well entrenched in the corporate environment. Im curious, before we get to you, mr. Santelli, if anybody here is buying amazon on the weakness that we saw friday or a name like apple or even a starbucks, because we did have kind of a trio of disappointing moves in those names. How about you, jason pride, are you . Were not very active in each of those names. We are active more broadly. You know, our perspective here is that we are in this transitioning phase from the early stages or the early portion of an economic expansion to the latter portion. The fed is starting to have to tighten a little bit, vary ever so slightly, the markets are starting to recognize that were a little bit overvalued. Were not dramatically overvalued. Were kind of right in the middle of historical ranges. And the gains from here are a little likely a little bit more likely to be in that modest range than the extraordinary gains that weve seen before. So, investors are going to have to start repositioning themselves. It doesnt mean that its an end to the bull market. It doesnt mean that there are opportunities like an amazon or an apple that you can buy individual individually, but it does mean that the returns are likely going to be lower Going Forward and perhaps the volatility picks up a little bit. So, rick, you know, this week the fed meets, and in six months time that janet yellen has been in office and were sort of assessing how shes done so far, i know you like to give a grade to each of the treasury auctions when they come out quarterly. And i know who im talking to. What grade would you give janet yellen so far . Well, i guess i would give her an incomplete. I dont really see that shes brought anything to the table that i can draw any serious conclusions about. As a matter of fact, theres a bury democrat bureaucratic feel to it that ive lost whatever gps i had. And when it comes to how the economy is doing, i cant remember which guest pointed out in terms of corporate profitability, but exfinancials 10 , you know . Its like retail sales, exautos, exgas, inflation, exfood, exenergy. Well, we dont live in an ex world. We live in a world where its all put together. And wheres this big kickoff, you know . Its so interesting to watch all these debates quarter over quarter, have so many argue with me as to what the Second Quarter will be joe lovorni pops into head. Im not seeing a 4handle and its questionable whether well have a 3handle wednesday. So, when i look at the Interest Rate complex, were still basically under 2. 5 , under that in spain, close to 1 on the bund. I think that the sovereign market ive just described outside of spain has everything pretty much correct. And i continue to say that jobs do impress, but its the type of jobs thats much harder to define when it comes to all the different policy issues of the day. Well, its the fire extinguisher. Whether its john harwood and entitlements, whether its inversion, these are old, old, old issues that we failed to address. Now we have to hurry up and blame people. It makes no sense. Rich bernstein, do you want to respond to that . Well, rick and i obviously are going to look at this a little bit differently. All i would say is i think one of the reasons that the tenyear is still below 2. 5 , clearly, gdp growth was weaker than people expected. But also, a lot of people are worried about whats going on around the world. And part of our story has been that throughout this bull market, the United States would benefit from the rest of the worlds problems. And i think to some extent, thats what were seeing. You know, the fact that people are scared about whats going on in the middle east or scared about whats going on in russia, if that has a positive effect on longterm Interest Rates, the u. S. Is going to benefit from that, and i dont see whats so bad about that. Rick, is he right . Well, alls i know is most of the entire day we were talking about how the markets seemed to avoid geopolitics, but when its convenient, of course, we bring it into the discussion to explain low Interest Rates, because it seems as though its not very american to say theyre low, because we now need to grade on a curve for the United States of america economy. And i think grading on a curve is a real lame excuse for the fact that we have subpar growth. I dont think it makes any difference. I think we should just accept that we have a tenyear below 2. 50 well, some people will just accept and others will be more proactive. I mean, 2. 50 has to benefit the economy more than 3. It has to. Why cant we just accept that . What was growth after the recession in the 90s . Wed always get to around 3. 5 , 4 , wouldnt we . Rick, youre missing the point. No, i think youre missing the point. Rick, the economy continues to improve gradually. Right, gradually. And by the time im 70, well probably get up to the growth we should have had if we addressed some of these problems. But as an investor, you want gradual improvement. Booms are good for politicians, but bad for investors. No, you can speak for investors, but as a citizen, i want much better growth so we can have a better shot, have the same standard of living you were privileged enough to have. Im not disagreeing it sounds like you are. Sounds like youre disagreeing with me. What im saying is that i have to think like an investor, not like a politician, not like an economist. An investor likes gradual improvement. Booms are very good well, actually, youre not speaking as an investor. Youre speaking as somebody who informs investors. My firm runs 300 billion, of course im an investor. Well go with that point at this time. Very instructive, good conversation there and i appreciate it very much. Rick bernstein playing the part appreciate. And the New York Times pointing out that the typical Household Wealth has fallen behind in the last decade. Fallen behind, huh . Because we talk about income, but wealth in general has taken the hit on the tens of thousands of dollars on average after that slow growth decade we were discussing. A little Wealth Creation today, though. The dow is up see what i did there . That was nice . The dow up 22 points now. The dow was down 80, but weve come back. So, selloff in the morning, buying in the afternoon. Thats when weve seen. And the s p 500 still positive, nasdaq slightly negative this hour. Weve got about 45 minutes to go. Busy week ahead, though, on the economics front. We mentioned the jobs report on friday. And before that, the fed decision day on wednesday. And it all comes as some in the fed may be testing Janet Yellens leadership. Steve liesman has that part of the story coming up and what it means for your portfolio and your wallet. Also ahead, jim grant, founder and editor of the widely read newsletter bearing his name speaking with us xluveexclusive. Well talk fed policy, geeold a global instability. How is jim grant playing it . Well find out. Up next, though, could president obama actually stop companies from domiciling overseas to pay less taxes without congressional approval, that is . And if the president could do that, would he do it . The pros will weigh in on this controversial issue when kelly and i come back after this. 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And the russell, Janet Yellens favorite index, down a fraction today so far at 1,140. Perhaps it has her in mind. A report today, meanwhile, quoting a former u. S. Treasury official saying president obama could act on his own to stop American Companies from merging with foreign firms to avoid u. S. Taxes, and its by invoking a 45yearold law that would limit the financial incentives to do such a deal. Like so many issues, tax inversions have gone unaddressed due to an impasse between congress and the white house. So, if the president could, in fact, fix this issue by himself with a stroke of the pen, as has been suggested, would he . Joining us to talk about it, eamon javers and james, money and politics contributor. Steven shay has worked in treasury for both the Reagan Administration and the obama administration. Hes now at harvard law. This guys got the chops. He should know what hes talking about. Have we heard from the white house in response to what he has said here . You know, bill, i emailed the white house earlier to ask them about this, and they said nothing about it. They referred me to the treasury department, which hasnt said anything publicly either. So, theyre not saying just yet whether they believe this analysis, but the president has said that he wants congress to do this. Hes calling on congress to act here. And of course, theres some politics in all of this, because the likelihood of Congress Acting any time soon is probably pretty small. Conventional wisdom here in washington is we are not going to see a tax inversion deal between now and the end of the year, even though the white house is making a full court press to get congress to do something. Whether they can do it on their own or not is not something theyre saying, whether they endorse this Political Legal theory at this point. One thing about this, james stharks it might reveal how far president obama wants to go on this issue. In other words, is it a better play for him politically to say he wants to do something about it than to actually try and do something about it . It kind of reminds me about the debate about that trilliondollar platinum coin, where they wouldnt quite say, like they have their in their hip pocket. They wont say could we do it, could we not. They wanted congress to think about it, but i think its a political issue. Its a good issue with them. Probably like their holy trinity of tax reform, you have the interest, the jet plane deduction and now the corporate inversions. They think it really works for them as economic populism and i think theyd hate to throw away that going into a very difficult midterm election. Im going to sound naive here, jimmy, but who would be against closing a Corporate Tax loophole, if it meant more for the government coffer as here . Other than well, for one thing, this is a catalyst for Corporate Tax reform. Everyone knows the systems broken. Listen, there was just a st. Louis fed study that came out today, said the ideal tax rate would be 12 , not 35 , so we want to get this done, anything that takes pressure off congress on this issue, you could say is moving in the wrong direction. So people are clear what were talk being, eamon as well, there are two pieces of the inversion thing. When a Company Moves its address overseas, one is so it only pays taxes in the u. S. On sales here instead of sales everywhere, and the other piece is it can then make loans from the Foreign Company to the u. S. Company and then deduct the interest for u. S. Tax purposes, and its the latter piece that steven shea is talking about, that the president could maybe do something about it. And again, how likely in your view is it that he will . And kind of to bills point, who does this play well politically for ahead of the midterm elections, do you think . Well, look, the president and the white house clearly think that this idea of economic patriotism, which is said on our air, we heard treasury secretary jack lew use that term at the delivering alpha conference. Theyre talking again today about this in an op ed in the washington post. They think this is just basic common sense thats going to resonate with voters, particularly in an election year. Its a midterm year. The president s been raising a lot of money. He wants droots do well. He wants to stem some of those sixyear losses that we traditionally see president s have. So, they think this is good politics for them. Whether or not they agree with that legal analysis, though, and whether they think they could actually do away with this with a stroke of the pen is another question. Jack lew making the case today that the companies that are doing this are removing millions from the treasury and are hoisting that burden on to mnge average americans who have to pay for things that benefit those companies, like military and courts and the rule of law. Keep in mind that Corporate Tax revenues