>> N. FACEBOOK THINKING THE
MARKET OF TIME TODAY.
COMPANIES UPON THE PRICE OF OIL
AROUND THE WORLD.
AARON GIBBS BACK WITH US AS WE
HEAD INTO THE FINAL HOUR OF
TRADING.
WE BEEN HERE BEFORE AND WERE
ABOUT 120 POINTS OFF THE WORST
SPIRIT FEELS LIKE THERE'S ALWAYS
SOME SORT OF COMING IN NOW,
WHATEVER I'M A LITTLE BIT OF
DIPPING AROUND TO SEE IF IT
TRIGGERS SOMETHING AS FAR AS
HIGHLY UNLIKELY TODAY.
IN FACT, THE QUESTION IS WHAT
CAN TURN US AROUND SINCE THERE'S
NOT A LOT OF BIG ECONOMIC DATA
AND EARNINGS SEASON IS OVER.
>> YEAH, WE'VE GOT THE RETAILERS
REPORTING.
WE SEE SOME REAL POSITIVE
NUMBERS COMING OUT OF THE
HOLIDAY SALES SEASON THAT MIGHT
TURN THINGS AROUND.
WE MIGHT GET A LITTLE BIT OF A
SANTA CLAUS RALLY MAYBE IN
DECEMBER AFTER THE HOLIDAYS.
RIGHT NOW IT REALLY LOOKS LIKE
INVESTORS ARE FOCUSING ON ANY
NEGATIVE NEWS.
JUST LIKE TODAY WE SAW THE
NEGATIVE NEWS ABOUT APPLE THAT
THE ENTIRE BRACKET IS REELING.
>> IT WASN'T NEWS PER SE.
THE STOCK AUTHORITY UNDER
PRESSURE.
>> AVAILS LIKE INVESTORS ARE
LOOKING FOR NEXT USE TO GO
NEGATIVE.
FOR US THIS IS GOING TO HAVE TO
WASH OUT.
I THINK IT'S ABOUT INVESTORS
REASSESSING WHAT THEY'RE WILLING
TO PAY FOR STOCKS, WHAT TYPE OF
VOLATILITY THEY'RE WILLING TO
HAVE FOR SLOWER GROWTH.
EVENTUALLY WE'LL FIND THE
BOTTOM.
I THINK WE'RE GETTING CLOSE TO
IT.
FOR NOW INVESTORS WANT TO FOCUS
ON THE NEGATIVE HEADLINE.
LIZ: THERE'S NO DOUBT THAT ALL
OF THIS IS HAPPENING BUT GOOD
NEWS DOESN'T GO VERY FAR AND BAD
NEWS HAS DAMNING CONSEQUENCE.
WE SEE COMPANIES THAT MISSED BY
A PENNY AND GIVE LOWER GUIDANCE
ABSOLUTELY ANNIHILATED IN EVERY
INDUSTRY.
FOR AN INVESTOR LIKE YOU AND I
THINK MOST OF OUR AUDIENCE OR
LONGER-TERM, HOW DO YOU RIDE
THIS OUT AND HOW DO YOU WONDERS
AND MAYBE THE PRICE DISCOVERY,
WHAT IT MEANS WHEN WE COME OUT
ON THE OTHER SIDE.
>> OVER THE LONG RUN, LOOK, IF
YOU HAVE PROFITS FROM AMAZON,
NETFLIX AND GOOGLE, THE EASIEST
PLACE TO TAKE PROFIT.
WHEN YOU LAST THE QUESTION
WHETHER SOMEONE DO NEXT AS A
LONG-TERM INVESTOR, PEOPLE ARE
TAKING PROFITS WHERE THE MONEY
HAS BEEN MADE IN THE GROWTH AND
MOMENTUM STOCKS AND THEY MOVE IT
TO CONSUMER DISCRETIONARY OR
MORE DEFENSIVE AREAS.
BACKGROUND 3% ON THE 10 YEAR
PERIOD YOU ARE SEEING PEOPLE
FLIGHT TO SAFETY, QUALITY,
MCDONALD'S, HOLDING UP BETTER
THAN THE BROADER MARKET BECAUSE
EVEN IF WE DO GET AN ECONOMIC
SLOWDOWN, PEOPLE ARE STILL GOING
TO BUY EVEN MORE SO.
LIZ: SPEAKING OF THE 10 YEAR,
FEBRUARY STARTED GOING UP.
IT WAS IN AT%, BUT IT WRECKED
THE MARKET FOR A LITTLE WHILE
AND THEN A CRACK TO 3% HERE WE
WERE OKAY WITH IT BUT THE LAST
RUNWAY BECAME AFRAID AGAIN.
NOW I'M HEARING AS THE GILLS
COME DOWN THAT'S ABOUT TIME FOR
THE ECONOMY.
I FEEL LIKE WE ARE IN A NO-WIN
SITUATION WITH THE 10 YEAR BOND.
>> YEAH, THERE HAVE BEEN SOME
POSITIVE NEWS WITHIN BASICALLY
THE INVESTMENT CORPORATE ABOVE
ARE STARTING TO SEE SOME LOWER
CRACKS.
AND YES AGAIN IT IS A TOUGH
PLACE WHERE WERE ACTUALLY SEEING
NEGATIVE DAYS IN THE MARKETS AS
WELL.
LIZ: $120 BILLION CAME OUT OF
CORPORATE BONDS, THE
HIGH-YIELDING, HIGHER RISK.
WHAT IS THAT SAYING, IS THAT A
WARNING SIGN ABOUT CORPORATION
AND THEIR INDEBTEDNESS?
>> IN GENERAL WE SEE AS
INVESTORS WANT TO TAKE SOME RISK
OFF THE TABLE JUST LIKE EQUITY
MARKETS WHERE YOU GET OUT OF
HIGHER-PRICED STOCK.
ALSO THEY'RE NOT AS WILLING TO
LOAN TO THE LESS QUALIFIED
COMPANIES AND ALSO PARTIALLY
WITH OIL BEING A BIGGER CONCERN.
IT IS JUST A LOWER APPETITE FOR
RISK.
LIZ: HAVE THERE, IS THE MARKET
TELLING YOU THAT OR IS THIS AN
ADJUSTMENT MOSTLY BASED ON
VALUATION AND A READJUSTMENT
PERHAPS THE LEADERSHIP.
>> YEAH, WE ARE IN A SLOWER
GROWTH ENVIRONMENT.
INVESTORS ARE ALL SAYING WE ARE
IN THE LATE CYCLE INNINGS OF A
NINE INNING GAME.
LARRY SUMMERS TREASURY SAYING WE
ARE IN THE SEVENTH INNING AND
HAS A 60% CHANGEOVER SESSION BY
2020 IN THE NEXT TWO CARES.
THAT'S NOT POSITIVE.
ON THE OTHER HAND YOU HAVE BANKS
LIKE JPMORGAN JAMIE DIMON
FRAMEWORK COMMON IS A SHORT-TERM
FOCUS AND YES THERE ARE CONCERNS
OVER RECESSION OVER THE NEXT TWO
YEARS BUT IF THE MARKETS DOWN
400-POINT TODAY WE MIGHT BE UP
TO 400 POINTS TOMORROW.
I THINK THE AVERAGE INVESTOR WE
WANT TO FIND A BOTTOM IN THIS
MARKET UNLESS YOU'RE A TRAITOR
OF THE VOLATILITY IS VERY
UNNERVING.
YOU KNOW, AND ALL EYES ARE ON
TWO THINGS.
THE FED IN DECEMBER IN TRADE.