Dow having a pretty good day. Its the Big Industrial names that would be more impacted by an economic slowdown of any sort of magnitude. Intel is holding up today ahead of the earnings. Chips killed lately. Those are the next best performers out of the dow today. I would suggest thats much more important than a chevron which is towards the low end sliding on oil. United health is a Big Hedge Fund trade and maybe selling there. Cocacola, staple. Home depot is a bad performer today and downgraded. Jpmorgan off the earnings. You raise the point and one the need talk about with the group coming up here but to what extent is pressure on the hedge funds writ large responsible for some of the market declines we have been seeing . I looked this morning and you saw even in the face of an up market that a lot of the most Popular Hedge Fund names were down and suggested they were selling the name and when the overall market bounced they got a bounce, too. Remember yesterday things looked decent at this time, too. The russell was green and closed to the negative and considerably so for the dow and watching to see if any similar pattern holds today. Art cashin telling us theres talk of sell orders on the close. Stocks rebounded a bit after yesterdays wild finish. For now. We want to know if you think the worst is over for the markets go. To cnbc. Com vote now and let us know what you think. Joining the exchange now, rob morgan, meg green, ken moray and very own rick santelli. Rick, we start with you. Bond traders got back to work this morning and hammered rates. How much of a tell is that still for the Broader Market . You know, i continue to think that the rate game is far from over. And we could debate the exact bottom but i think a better debate is i dont see any big sustainable selloffs in the future and coming to whats going on around the globe, much of whats moving the u. S. Markets are global affects. Many of the global affects in europe of how effective mario draghi is, we dont know the answer the at this point and with regard to the u. S. Economy, well get more clues tomorrow with retail sales and empire but i would look for all the dynamics to continue and on energy down here, they keep it simple. Listen. The u. S. Is just barrelling along in terms of the independence of the potential production. It diminishes anybody else that we need from an import perspective and demand around the globe and every arena is down so it shouldnt be so shocking. I think the treasury complex is lockstep of the energy complex. What do you think of jeff gunlock told me, the 220 should be the lowend rate . I think theres a bit of a bounce but i dont think in the grand scheme of things in three, four months looking back, 220 is going to be the low yield of this move. Why not . I just think that the dynamics havent changed. We are now starting to see markets that can get pushled around like equities and the fundamentals of the globe are having a bigger presence in that push and i dont see them diminishing. I see them picking up. Gundlach say there iss no reason for rates at 220 now. They should be 180, lower theres no reason, boon yields wont approach japanese Government Bond yields. What if draghi and the speculation that he promises with regard to what he can do in a qetype environment doesnt pan out and the germans dont sign the checks . Theres a lot of unknowns here. Listen. Who am i to go against mr. G . I dont think its that easy to handicap. Proven that right over the last 12 months, thats for darn sure. Rob morgan, what about you and against the backdrop, the comments of John Williams today of the Federal Reserve indicating here for the first time that disinflationary conditions persist, the fed, yes, may begin another round of asset purchases . Well, sure. I think its wise for the fed to be on the lookout for that but i think right now the expectation is that we will get qe out of europe and at some point next year our fed will start raising rates and been saying all along. The dollar continues to go up. This is going to continue to hurt commodities and i have had an underweight on energy and materials for quite a while but at the same time the u. S. Economy is healing. People say that the rising dollar going to hit the gdp and trade and will a little bit. Keep in mind, the expansion of the 80s when we saw the economy as well as the stock market go up so dramatically, the dollar tripled. I still like stocks here. I think this is a buying opportunity. I do not like the energy space, though. Rob, why do you think oil is getting hammered to the magnitude that it is . Down 4 . I mean, relatively speaking, thats as if the dow went down 600 points. Scott, i think actually its a combination of a few factors. You talked about the fact that hedge funds camping in the energy trade. I think the stocks were overbought to begin with. I think there was a lot of ignoring of the fact that the u. S. Is awash in oil. And also, too, theres a realization that, okay, europe is going to do qe next year and the dollars probably going to be strong. All three of those factors kind of combined all at once to just really hammer crude. Meg green, give us your take here as people are voting live right now, same question. Is the worst over for the stock market here . You know, i dont know what the worst is but i know that volatility is here. Every time when they stopped, you know, buying bonds when qe stopped last year when they were threatening the market volatility was horrendous. So now we know theyre ending this month and i hope they do. Europe needs to start giving us a little juice over there. Thats the problem. And oil, you dont have opec agreeing. Theyre all just floundering out the oil they can. Russia is producing. So, you know, everybodys on the same path. That makes lower prices. Its supply and demand and theres tons of supply around. But the markets, you know, i like small caps here. Are they in dangerous territory . You know, were going to have a bounce back with small caps. Well have a bounce back with the market. We dont know how soon and what kind of a ride it will be in between. But yeah. I like the market. Its an opportunity to get in right now. Ken, i want to quickly get you in here before we move on. Can you address whether you think small caps are in buy territory . You know, i think that we have to always be careful about what the bond market is saying and not ignore it. Its doesnt seem to make sense if the economy is doing so well, the stock market is rising because of that, but yet, Interest Rates are going down. They should be going up if the economy is better, shouldnt they . I think the bond market is telling us theres trouble ahead. It is reminiscent to me a little bit of late 2007. My belief system is to always build defensive strategies into the investment portfolio. It is like if you have a tornado warning, bad clouds and doesnt mean the tornado will hit you and does mean you should take precautions and right now the market is very reminiscent to me of late 2007 when we told our clients to sell and we said to stay out for all of 2008 and the bear market came. This is are you saying, so you think were heading into a bear market . Do you think as we did then that its a recession . No. Its artificially low Interest Rates, a mountain of debt and i dont know how whether its a facade or not. Do you think were heading into a recession . Bull markets generally end in a recession. No. Theres a possibility we are and especially if europe takes us down with it. Im not suggesting that we are ready to sell or that theres a bear market coming. What im saying is that a prudent investor needs to protect from that because the signs are there its a high possibility right now. Lets get a take right now and stay there from jim bianco joining us with his take. If you could start on the move of the bond mrkt. The bond market move i think is somewhat understandable. If you look around the globe and domestically, i dont know why yields should go up. The economy is lackluster for years. I think its more of the same this year. Earnings are not that great. Theyre going to be low single digit growth rates of 4 , 5 , thats nothing to write home about when the longterm average is 10 and inflation is low. Yields are microscopic in europe. And there should be a capital flow into the u. S. Theres only one reason that yields should go up right now. That would be a return of inflation which we dont have and if we ever did get a return of inflation, the yields go up, it would hammer the stock market. The bonds have been the best return, the best investment in 2014 which no one has had. The 30year bond returning 23 this year. Probably continue that way as everybody continues to diss the bond market because the fundamentals are still there. The dollar is so strong. Jim, you dont think the economy is Getting Better . We have one of the worst quarters ever in the first quaerlt. The economy yeah, right. We know about that. Because of a largely due to the weather. Thats old news. After 64 months, we put together four good months or five good months of the economy. We have not bounced back from the weather yet. We wind up with a bad year and this is the repeat of the story that we have had year after year. 2011 we said exactly the same thing. We had a bad winter then. Well bounce back from that. We never did. 2012, 2013, same thing. I dont see the economy as getting ready to go to another level. Everybodys been calling for it. Since basically 2009. Its just more of the same. Kind of a lackluster, if you want to grade on it, a cminus kind of economy. Not a recession and very constructive for the bond mrkt. Meg, we have to go. We have several guest s shaking their heads. Meg . Well, theres trillions of dollars on the sidelines. Companies are hiring. Lower oil is good for the consumer. We may have a santa claus rally. I happen to think Jeremy Siegel is right on the dow 18,000. I dont know when but for people who are looking at this and getting scared and saying, hey, it is a bear market, no. Theres going to be volatility. Wait. I want to say that at the beginning of this year and on this show i said the dow at 18,000 to year. I havent backed away from that but nobody has a crystal ball or certainty. No, of course not. Im saying it is better, a better strategy to plan for the worst and hope for the best. I think this is a correction. I dont think its going to create a bear market. But all the signs are there. The buildup into the y2k bear market was a i thought you were saying its a bear market just like 2007 and talking about a u. S. Recession. Im saying that guidance are there . Im saying that my goodness. The possibility right now is as high as its been since the bear market started. We have a 200 rise since the low in the market in march of 09. Thats twice the rise that led into the bear market of y2k, the bear market of 08. We average a bear market every three years. This is five, almost six years since the last bear market ended. I think it is better to plan for the worst and hope for the best than just to hope everythings going to turn out. Rob, lets ask you. As were fading here as we have been. As were, you know, getting further along into the last hour of the trade, how important is it for the stock market today to close positive after you had really nice bounce earlier in the day, pretty good earnings from the banks and Johnson Johnson, pretty good commentary out of some of the financial ceos . How important is it to close positive today to confirm some kind of a higher move . I mean, scott, we have had some bad technical damage here regardless of where the dow closes today or the s p. But just let me respond a little bit. We had six straight months of 200,000 job growth and then basically a little blip that didnt meet that. Thats the best we have had since the 1990s and then as far as the job openings, best in ten years. You have two president s of banks today, dimon and wells fargo, saying the economy is improving. I just dont get it how anybody can say that this is just a lackluster economy. This is a healing economy. Stocks are nowhere near as expensive as 2007. Look at income. If you want to answer that, look at middle class income. Look at the biggest swath of americans. Thats been a 30year trend, rick. Doesnt matter if its 100year trend. We have to deal with it today. Just like entitlements. Not the president s fault that it is. It needs to be dealt with. We havent had a 30year recession. Rick, look. Just spoke to rick and jim and respectfully, the data which would certainly suggest the u. S. Economy is better than you both and others give it credit for. Im not suggesting better than it was and not like it used to be. Not saying a robust economy. Thats what jims saying. Not as dire as one of you suggest. No. The economy whys the fed have 100basis point overnight rate. The economy is always best right before the party ends. I mean jim, sir, a last word of response here. Talking about small cap stocks 9 for the year. Disastrous year. Interest rates falling through the floor. Great year for the bond market. Commodities are collapsing. Thats a recipe for a very weak economy. The data, the markets are reading the data and consistently from the currency markets to Interest Rate markets, the stock market, theyre all trading as if the data is rather weak and lackluster. You have stocks down. You have got yields down. Commodities down. This is last six weeks. We were hitting record highs. Before this correction started. Whatever. Well debate it some other time. Thank you, everybody, for being here this afternoon. And by the way, the poll for those following along, the worst ever, yes. It was neck and neck the entire discussion and now about 45 minutes to go until the close. The dow up 18. The s p trying to stay positive. The russell, scott, watching closely still up 1 . Much more ahead on the markets and the selloff especially in oil. What it means to you and the economy. Speaking with oil traders. Plus wells fargo slipping on higher expenses. The chief Financial Officer is here. It is a first on cnbc interview. Well find out how the Mortgage Business is going. Plus, asking him about an email, one an employee sent to the ceo asking for a raise. Oh, and copied the entire company, too. Yes, he did. Also coming up, csx making a deal . Well ask michael ward joining us and intel cfo right after thor andings drop. Cant wait to hear straight from that chipmaker as the sector is under pressure. Stay tuned. All of that coming up. You got the bargain kind . You would need like a bunch of those to clean this mess. [ kc ] youre probably right. Hi, cascade kitchen counselor. 1 pac of cascade complete cleans tough food better than 6 pacs of the bargain brand combined. Cascade. Beyond clean and shine. Every time. All right. Welcome back. Theres a look at the major averages. Yeah, were fading as we have been in the last several days, especially yesterday was one of the wild days where once we started to go down, we started to go down really fast. Not saying thats going to happen this time but the point is over these next 40 minutes things can get quite volatile. We dont know. We dont. But dominic chu is covering the big movers for us today. I certainly am. We have stories to talk about. Lets start with netflix on the rebound. Analysts upgrading the stock here site overseas expansion plans and shares up in the trade so far. Also skyworks solutions, apple supplier raising the forecast. Shares trading up by nearly 8 and darden restaurants, naming jeff smith, jeffrey smith, as its chairman and companys coo jean lee as the interim ceo. Darden up by about 2. 5 . Flip side, Signet Jewelers losing ground after the ceo barnes resigned and replaced by president and coo mark lite. See the shares down 3. 5 and end with one of the Major Bank Earnings for the season. Wells for fargo matching for estimates. The shares you can see there down by 3. 5 . A bigger decliner on the overall session. Back over to you. Thank you for now. Lets dig deep sbeer the numbers. Joining us now is john shusberry. Nice to be here. Interesting quarter. You matched, obviously. Margins clearly seem to be the biggest issue. Im just wondering sort of what visibility you have in this economy, what Interest Rates is telling us and affecting your business. Sure. Well, first of all, with respect to the quarter, it was a great quarter with profit, loans were higher across all categories and deposits higher, as well. So we feel great about that and set up nicely i think for the coming period. Interest rates and the bond market have come down sharply. Seems like every time we get towards 2. 5 on the 10year, we get a retrenchment and yields go lower. We are equipped for that. Our Business Model works such that we have something for each point in the cycle, equity market dependent, Mortgage Business, certainly. Right. But we like the way were positioned. Clearly, the way that rates have moved so dramatically within this quarter alone, that has to directly impact your loan business, net interest margins, the key metric of profitability that a lot of people look at for the banks. Theres a dramatic effect by these the rates and the way theyre falling and what it means. Im not im just i guess a little surprised that would havent a more dramatic impact Going Forward if the pattern holds. If yields stay low like they have for sometime, the business performs very well. Sometimes the Mortgage Business does better when yields are lower. Bond portfolio performs better with lower yields. Less likely to deploy liquid markets but if things stay this way the Business Model produces, performs fine. Its a very diversified set of outcomes that perform well in the cycle and whether or not rates go higher isnt the most immediate concern. We are set up well if rates go higher and thats true of most banks these days with asset sensitive balance sheets. You know, john, we remember a couple of quarters ago and jamie dimon said you were outmortgaging him in the business and fighting back now and going to quote an industry publication here saying that while the originations healthy, they were roughly flat and jpm up 26 . Do you think they outmortgaged you . Well, i dont know. 48 billion worth of mortgage production is a good number, and the profit generated from that business actually did very well in the quarter. Our business, its more of a purchase market and set up with that on the mortgage side. We like where we are and how they perform or how all other competitors perf