Transcripts For CNBC Closing Bell 20140428

Thats dragging the market lower, the socalled momentum stocks that saw so much selling in february. Seeing it again. The amazons, the netflixes, the pandoras, tes larks you name it. They are heading lower today. Yeah. The question still becomes is there something bigger going on here, or is it just about the individual stories . Speaking of which, after the bell, it may be the battleground stock, creating more disagreements among investors than almost any over. Talking about herbalife, reporting earnings after the bell. Results and analysis when it hits. Shares today up 2. 5 . And the heat being turned up on Los Angeles Clippers owner Donald Sterling. Several sponsors now have dropped his team after alleged racist comments were made public this weekend. Will he be forced to sell the franchise eventually . Well be speaking exclusively to legendary attorney bob bennett. One of the great power players in washington history. He represented president clinton. He also represented the late marge schott when baseball forced her out as the owner of the Cincinnati Reds years ago after she was accused of racism. It will be very interesting to hear how mr. Bennett feels this will all come to an end a little bit later. Thats right. Lets show you the markets, shall we. As we mentioned, the dow is up, bill, 23 points. This is index that still hasnt reclined its high, december 31st the end of last year is when he had the close high. Had an intraday high. Like a team that cant hold the lead. Up 100 points on the open, and we see where it is right now. Nasdaq, thats the big loser today. Momentum stocks to blame. Once again, the story there hasnt changed, it seems, in the last couple of weeks and the s p 500 index, off two points to 1861, and were looking at a more defensive tone to this market as we enter the final hour. A lot to talk about with our closing bell exchange. Peter, give us some of the hits, runs and the errors here today. Yes. Once again the dow is higher on the open and then it fades into the afternoon. Well, you know what i think . Were at a point in the market where i think it might be a little tired, so you know what . We had a decent rally this morning, you know, with the housing numbers, and i think after that ran out of steam there was some talk about, you know, some actions in the ukraine that might have precipitated the selloff, but i think its more about, you know, the more it gets tired. Not ilott of volume, even if the market is up a little bit, nothing is happening. Doesnt it tell you something the way the market is holding in here, not to mention the geopolitics of all of it and the data this morning on existing houses was good. The data was god, but i agree with peter. The market acts kind of tired. Its been trying to go through, you know, conflicting information. I dont think the earnings numbers have been that great. I think everybody has been waiting for a rise in Interest Rates, and thats not happened yet, and i think theres a frustration setting in there and we continue to churn sideways without doing much of anything. You think fed tapering is having an impact here, dont you . I do, i do, and, as a matter of fact, i like to liken it to a training wheel kind of an economy. The fed has been loud and clear about the fact that they will be tapering. Like teaching your kid how to ride a bike. Put the training wheels on, let them know youll talking the wheels of course, let the wheels come out and they they might fall a few times before they get up and go again. I think were getting to a point where we need to stand on our own two feet. Do you think well go through. I dont think so. As far as Earnings Seasons are concerned the projections and guidance have been very muted, low and uninviting. A few outliers but for the most part nothing really to drive this. I think most will come lieu in the Second Quarter where well start to see the wheels really come off and companies starting to really stand on their own two feet. Todd, what do you make of financials here, the fact that bank of america is down or does it tell you about the strength of these institutions and their ability to return capital. I think youre seeing a classic rotation and place here in the equity market. Starting to see investors tilt towards values and materials and energy and telling away from the high flyers and high valuation and small caps. Youre seeing it take place. Its a rotation that we like and are in front of. Joe, i think you agree with renee that well so a pickup down the road. I think we are. So far this year markets have just been struggling to find any meaningful direction. Of course, the Economic Data out of the First Quarter was almost week and well see it translate into a very inspiring earnings number. Having said that, seeing signs that the ice cube is thawing. Things will puck up and now we have this continued text between russia and the ukraine weighing on investor minds and between now and year end data is going to accelerate and looking at russia we hope that the situation there will deescalate. Jim, this goes back to a point of how you made a point that your own research said pretty much everybody surveyed, you think you talked to five dozen guys on the street, every Single Person expects rates to go hour and thats been the case for months here as rates have consistently not going higher. 67 economists were surveyed at the beginning of april. Look, everybody wants to buy a message. Just short the bond market because everybody is concerned its going up in price and down in yield. Would you really . No, i think therein lies the problem. The pride has already happened. What do people say when they are all bearish . Already sold. No more selling left, and thats why yields are not going lower anymore and all the talk of Economic Growth and Everything Else is not getting a rise in yield because that trade has already occurred. How doik a Million Dollars in commodity, you start with 2 million. Ukraine, if that happened right now, theres still of thought who says. I would like to say no because i want to be on the opposite side of that. If you look at the companies that actually have involvement with russia and ukraine. U. S. Based companies, no a whole lot of them. There is pressure but if you look at the overall u. S. Economy, its part of it. Its a small mart of it. You look at the companies that do business with the ukraine and russia. Their percentage of what they do with them is very small. I hate to interrupt, but the thinking goes like this. Its having a great impact on europe because. Potential economic problems they could have fef they pull back, they being russia, on their Energy Supply to that continent and, they are, they are selling over there. If you look at it, we will be able to replace that the russians have been the more chances the more opportunities we can replace the natural gas and im they get from russia. If its a slow process the European Union will be okay but if its a quick problem thats a different situation. I think the russians will be in this for the very, very long term, and thats where the benefit of the u. S. Backing europe is going to be very important. Before we go, renee, what are you buying . Are you buying anything here . Im really taking advantage of the a lot of the valueoriented stocks. Dividend day paying issues are for proxy now and that makes a lot of sense to me and i also like a lot of Cyber Security issues and i like the strilts. Joh johnson controls, one of the few outliers with extremely good earnings. Theme of an improving economy. Just need the tenyear to confirm it. Thank you. Good to see everybody. 50 minute left in the trading session. Really is good to have you back. Very nice. Look at this. The markets are rallying, up 55 point right now. The dow was up 100. We turned negative and now were headed higher again. Coming up, bank of america getting clobbered. Mentioned this briefly after stopping a stock buyback and shares down 6 , and how does this happen with regulators inside b of as offices . One regulator will weigh in on that. Hes not happy. Who is happy about that. Incredible how that happened. Also ahead, pfizer, as we know, is offering nearly 100 billion to buy the uks astrazeneca and one big reason, lower Corporate Tax flates britain. What does that say about our tax code when u. S. Giants are willing to spend billions overseas for tax relief . Well talk to the tax pros about fixing our tax code. And up next i dont see your views. I wasnt raised the way you were raised. Well then, if you dont feel it, dont come do my games. Dont bring black people and dont come. Do you know that you have a whole team thats black that plays for you . Plays for you . Companies pulling the plugs on sponsorship to the Los Angeles Clippers. Will clippers owner Donald Sterling go the way of former Cincinnati Reds owner marge schott who was ousted from Major League Baseball after making racist remarks. Famed attorney Robert Bennett is with us. He represented schott years ago. Also represented president clinton during the Monica Lewinsky investigation. Hell speak with us excleesive when we come back on closing bell. Bell. With all the opinions about stocks out there, how do you know which ones to follow . The equity summary score consolidates the ratings of up to 10 independent Research Providers into a single score thats weighted based on how accurate theyve been in the past. Im Howard Spielberg of fidelity investments. 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Its your last chance to get three years interestfree financing on beautyrest black, stearns foster, serta icomfort; even tempurpedic. Plus, get free delivery, and sleep trains 100day low price guarantee. But hurry sleep trains interest free for 3 event, ends sunday. Sleep train your ticket to a better nights sleep welcome back. Look at this Market Making a comeback late day here. The dow just a rea, up 100 points on the open this morning, and immediately started to see it fade. We were in negative territory about an hour ago, and now were coming back again, and look at the nasdaq. That was down 1. 4 for a time today. Its down just four points at this point. Almost round trip. Well keep an eye on that. Weve had m a news. Tomorrow is turnaround tuesday. Already happening right now. Maybe were borrowing from that this hour. The Los Angeles Clippers have begun losing corporate sponsors due to some racist comments hes allegedly made. From main street to wall street, the talk all weekend. Talk about a turnaround tuesday, the clippers and Donald Sterling may need one because the fallout continues over clippers owner Donald Sterling allegedly racially charged phone conversation released over the weekend by tmz and deadspin. Take a listen to some of the highlights here. People call you and tell you that i have black people on my instagram and it bothers. You yeah, it bothers me a lot. If you want to broadcast that youre associating with black people. Do you have to . Now we are a Business Network so heres the businessage. Sponsors are starting to pull out one by one. Earlier today car max said they were ending their nineyear relationship sponsor with the clippers. Virgin america also pulling the plug on their relationship as well. Then you have state farm, kia saying they are pausing and suspending their relationship and the list is expected to grow. Just recently, in the last few minutes here, others have come out and said they will suspend their sponsorship as well. Thats the red bull brand. The nba is also announcing that the commissioner adam silver will hold a press Conference Tomorrow at 2 00 p. M. Eastern and the clippers head back to the Staples Center for game five and yesterday the team wore their uniforms, you can see them inside out and black socks and armbands to protest their owners remarks, the warmup uniforms. Everyone from president obama to nba greats like michael jordan, magic johnson, lebron james, have all weighed in on this, speaking out against sterlings alleged comments. This is silvers first big test since taking over as commissioner of the nba for david stern in february. A lot of moving parts right now, but well it be to monitor this story. Obviously one that has everyones attention. Bill and kell, back to you. Including our next guest. Our next guest is uniquely qualified to comment on this situation. He has been for decades, and a member of the power elite in washington, d. C. He represented president clinton years ago, defense secretary cap weinberger in the early 90s, it was marge schott who owned baseballs Cincinnati Reds. She was accused of making racial comments at that time, and baseball eventually forced her to sell the team. Mr. Bennett represented her in that case as well. Yes. Joining us now is bob bennett. Now a partner at Hogan Lovells law firm and its great to see you. Thank you so much for being here. Thank you. Glad to be here. So i guess the main question, considering the nba, what is at stake here, we can talk a little bit about what privacy laws that may involve and the divorce donald stearn is going to get through here. Will he have to get rid of the team here . No, i dont think so. I dont think the commissioner would really have that power, and dont forget the other owners dont want to creed that power to the commissioner because they could find themselves in a situation. Now, it may well be that the economic pressures by the withdrawal of sponsorships and so forth could cause a resolution where the team was sold. If you remember i believe that mr. Sterling bought the clippers in the early 80s for something over 12 million. Right. And its now worth 700 million or 800 million, so i dont think a lot of pressure would have to be put on him to sell. And actually forbes has been out with an evaluation around 500 million. If you dont feel he would be forced to sell the team, which marge schott was forced to do eventually, it took a few years and it happened eventually in Major League Baseball, what about the reaction of nba players and former players over the weekend . Magic johnson, Kareem Abduljabbar and on and on. Kevin johnson, former great, now the mayor of sacramento called this a defining moment for the National Basketball association. I mean, it is clear players are not going to settle for anything less than him getting the maximum penalty. What do you think that should be . Well, you know, its not for me to decide that, you know. I think initially there will be a fine and maybe a period of suspension. Of course, its pretty hard to fine somebody worth close to 2 billion, but i think there will be a lot of pressure behind the scenes for him to sell the team. And, you know, thats going to raise some questions as well about, you know, to what extent were talking about somebody who is going through a difficult divorce. The way in which this recording came about in the first place. How relevant is that going to be to the way that this is played out, leaving the court of Public Opinion aside. Was that a legal recording to make . And how is that process carried out . One of the problems is the commissioner is going to have to decide whether, first of all, this is an authentic tape. As i understand it, it came to light because of a defendant in a civil litigation matter against mr. Sterling. Secondly, depending on where it was record, and i believe it was california, it may be an illegal ly obtained tape so it would be hard for the commissioner to place the fine based on Something Like that. You know the toothpaste is already out of tube and the court Public Opinion has been heard. I mean, adam silvers hands are pretty well tied in that regard, arent they . Tied in one respect because they are not tied as to the penalty and thats, you know, it could be from a to z, but i think whats going to happen, and i dont have a crystal ball, but having been involved in matters like this, theres going to be a tremendous amount of pressure to sell the team, to get to get him out, and you can be sure as we are talking, some of the other owners are going to be calling him and saying that he should take one for the team. You know, look, i grew up in los angeles. For decades the clippers were the doormats of l. A. Behind in the shadow of the lakers, okay. Now ironically they are a contender this year. What do you think is going through his mind . You knew marge schott very well. You represented her. She was sort of in denial for a while. She didnt want to sell that team by any means. Do you think hes thinking the same thing, that he can get through this . I dont want you to psychoanalyze Donald Sterling, but what do you think hes going through if you can compare him to marge schott . Well, i dont know if its a fair comparison. Im sure one of the things hes thinking is how can they do this to me when at the very same time the naacp is giving me an award. Which they have now cancelled, by the way, but, still, he received an early award and, you know, hes likely to say, well, judge me by my actions, not by my words, and, you know, look. It was well known in basketball that he was inclined to say things like this, you know. There was a big Justice Department lawsuit against him, so, you know, its like the old casablanca movie, you mean theres gambling here. I know this isnt relevant, but thats whats so troubling about this. You know, in cases like this, and its come up with Public Officials over time as well, when an incident comes to light and everybody locks at each other and goes, yeah, you know, were not surprised. I guess theres nothing anybody can do until theres that smoking gun, but it doesnt make it any easier for anybody to come to terms with it simply because it was known about him. That makes it even worse. Well, you know, i dont disagree with that. Its a very of what penalties they will try to impose and how much opposition he will put up, and i think that youre going to see an amicable resolution of this because theres too much to be lost by everyone . Yeah. But dont forget basketball has has to go through a certain due process procedure. Right. Or process to which its due, and my guess is that basketball is going to want to get this resolved sooner rather than later, and a lot will depend on whether mr. Sterling used all of the arrows to put them to the test. My guess is he will not. My guess is that everyone will realize that it makes sense to get this resolved and get it resolved quickly. Commissioner silver has called a News Conference for tomorrow before the next game between the warriors and the clippers, so presumably well get some sort of resolution at that time, maybe. Well see. Mr. Bennett, a pleasure to have you. Thank you for joining us today. My pleasure, thank you. And now back to markets. With 35 minutes to go to close in the dow, look at this. Round turn. Triple digits, a big chunk of that owed to pfizer on some big deal talk, and we eel talk about that. The s p 500 is up about where to go. The nasdaq 5. The 100 billion pharmaceutical buyout in the works driven in part by lower Corporate Tax rates in the uk of all places. Sort of ironic. Will Congress Finally fix the tax code to stop that kind of financial maneuvering . Well talk about that coming up. Twitter talking about its stock ahead of earnings today. More on that when closing bell comes right back. [ male announcer ] this is the age of knowing what youre made of. Why let erectile dysfunction get in your way . Talk to your doctor about viagra. Ask if your heart is healthy enough for sex. Do not take viagra if you take nitrates for chest pain. It may cause an unsafe drop in blood pressure. Side effects include headache, flushing, upset stomach, and abnormal vision. To avoid long term injury, seek immediate medical help for an erection lasting more than four hours. Stop taking viagra and call your doctor right away if you experience a sudden decrease or loss in vision or hearing. This is the age of taking action. Viagra. Talk to your doctor. If your doctor decides viagra is right for you, you can fill your prescription at your pharmacy. Or, check out viagra home delivery, a convenient place to fill your prescription online and have it shipped at no additional cost straight to your door. Viagra home delivery. Get started at viagra. Com. Welcome back. Take a look at these two companies. Ukbased at csonka is surging on pfizer ears 99 takeover offer eamon javers, tell us more about this story. Critics today are calling this proposed deal outrageous because in the deal pfizer would be endajing in whats called a tax inversion. Thats when one company buys a subsidiary overseas and inverts its Corporate Structure so the Mother Company is now a sub of the overseas company. Thats what would happen under the deal. Heres how pfizer laid it out this morning. Pfizer saying the transaction, if consummated is expected to result in the combination of the two companies under a new ukincorporated holding company. Why is that important. Well, taxes in the uk are lower corporate rise than they are here in the United States. Pfizers defenders argue that the fault here is simply in the u. S. Tax coated and taxes in the United States are too high and forces Companies Overseas to engage in transactions like this. I spoke to pfizer earlier today saying they are seeking the most efficient tax struck two, the word they use for it, and have 28 days now where they have to figure out whether or not they are actually going to go forward with this astrazeneca deal. We can expect to see some more estimates from pfizer about what its tax savings will be once they decide to go further with the deal. Eamon, thank you for now. Lets talk more about the tax aspects of this deal because just how broke seine our tax code if its causing one of our major american companies, like pfizer, bill, to effectively jump ship. Joining us to talk about it, representative jack young, republican of indiana, and a member of the taxwriting house ways and means and jared bernstein, senior fellow on american budget policies. Weve contacted several democratic congressmen who declined our invitation to appear today and jarred, youre an economist as well. Right. Do you blame a company like pfizer for wanting to do a deal like this if their Corporate Taxes in the United States are too high . You dont set tax policy in a vacuum. Internationally it makes more sense to go overseas. Its a great question, and its a fair question. I do think that this doesnt smell very good from the perspective of the average american or to me either because they are really renouncing their american citizenship to avoid to engage in tax avoidance, and i think thats wrong. On the other hand, the rationale is very clear. We do have a disfunctional International Tax system, and if i were a congressman on the taxwriting committee i would try to do something about it. Congressman young, what are you going to do about it . Well, its clear that mr. Bernstein and myself agree on the need to fundamentally reform the system. Our Corporate Tax rates are the highest in the industrialized world at 35 . We double tax profits that are earned overseas and our r d treatment is adverse as compared to our international competitors, so i think we need to move forward on each of those fronts. We all know, to be clear, but theres been no action, a im sorry for every day that passes, every session of congress that passes, this you are seeing this is a major deal, a major u. S. Company that is now doing this because you guys. Indeed. Have failed to get ahead of this issue so what are you going to do about it now . Allow me to agree with you, perhaps with more stray densy than you put it forward. We need to in a bipartisan way to overhaul the tax code and need to find areas of agreement if we cant overhaul the code and bring down the corporate rate and improve how we treat overseas profits. Lets deal with the r d portion which well do in the ways and Means Committee tomorrow, well make that r d credit more generous. Do you think thats going to change pfizers mind . No. Do you think that will scrap the deal . Absolutely no. We need to go far further and why ive been pushing and other members of the committee on the republican side to overhaul the entire code, not just the corporate side but for also for small and mediumsized businesses. I would estimate that mr. Bernstein would agree on the need to do this. Jarred, what would you do . Look, i would i would very much pursue a broaden the base, lower the rate and the interesting thing is that the white house itself has put forth precisely such a plan the congressman says hes in favor of such a plan. I think a lot of people are Walking Around on a day like this and very much share the urgency of the voices of everyone in this segment, Walking Around and scratching their heads and saying why arent we doing something about this . International taxation is a huge problem, and we have to coordinate our actions with our countries to really tamp down. That will make it quick if were coordinating with other countries. Theres nothing else to do. Thats a fair point, but i do think, and lets be clear about this, fooirpfizer is engaging i legal tax avoidance given the code and understandable and if congress is not working on fixing this international problem, then they are simply not focusing on whats important for american competitiveness. This is a year divisible by two. Are you really itsbly going to be able to do tax reform in an Election Year . I think were doing our part on the ways and Means Committee putting forth a tax plan that will attract more investment and disincentivize this inversion. We believe you need tax relief not just for the largest corporations headquartered here in america but also for small and mediumsized businesses and thats where myself and mr. Bernstein disagree. Congressman, you have 28 days. Quickly. Weve got to go. Ill be very quick. Congressman, i understand that we can find areas of disagreement, thats easy. Weve shown were good at that. Lets sit down with both sides and find areas of agreement because this situation is very urgent. Well, if you go and solve the easy problems early, which is the corporate rate, and it is easier as compared to the individual rate paid by smaller businesses you forgo an opportunity to provide relief to families and small and mediumsized businesses, and i think you know that. Sounds like a recipe for gridlock. Theres got to be a way to make some headway to avoid this happening any further. Well leave it there. Thank you very much. Thank you very much for joining us. Thank you. Meantime, dow is holding on neither highs of the day. This has been incredible. What a day. What an hour. And on a monday. The dow up 106 points and back to the highs of the session that we set on the open this morning. The nasdaq, which was down 1. 4 , maybe a little more than that at its low of the session and now positive. Well see if it can hold on. 25 minutes to go, and bake of america putting the kibosh on a stock buyback and dividend increase, one of the stocks weighing on the market all because of a mistake made during the fed stress test process. How this all happened and who should take the break coming up. After the break, why brooks running loves billionaire Vice President , brooks running ceo, jogs into your living room. Dont touch that remote. Uch tha. [ male announcer ] the Wright Brothers started in a garage. Mattel started in a garage. Disney started in a garage. Amazon started in a garage. The ramones started in a garage. My point . Some of the most innovative things in the world come out of american garages. Introducing the lighter, faster cadillac cts. 2014 motor trend car of the year. Aint garages great . [ male announcer ] when fixed income experts. Work with equity experts. Who work with regional experts. Who work with Portfolio Management experts, thats when expertise happens. Mfs. Because there is no expertise without collaboration. An eventful volatile day on wall street. A 100point gain on the open this morning faded fast. Negative for a time and now were back up 100 points. The nasdaq has erased a 1. 4 deficit. Back up seven points at this hour. Crazy day. If youre wondering that rascal pfizer is one of the reasons the dow is doing so well, up 4 , a big move for that. What else is moving markets today is this. The smallcap stocks bouncing off their 200day average. Apple continues to move higher after its Earnings Report, stock hitting levels it hasnt seen since december of 2012. Ibm, big blue, one of the dows biggest gainers on news it will launch its own cloud Market Players to bridge the gap between the cloudy service and existing customers. A tough day for socalled momentum stocks though they came off their lows, priceline, netfl netflix, amazon at session lows. And a planned increase in its income after miscalculating certain securities obtained through the acquisition of Merrill Lynch back in 2009. A generally very volatile day for stocks. When Berkshire Hathaway shareholders attend the meetings this weekend they wont be running any old sneaker. This limited Edition Sneaker is available exclusively at the meeting which comes up this weekend, by the way, on the insole, you guessed it, a picture of Warren Buffett himself. And they say no one tramples on him. With us exclusively is james weber, brooks running ceo which is also celebrating its 100year anniversary this may. Welcome in. Good to have you. What did Warren Buffett think when he saw the sneakers . Thanks for having me. You know, warren loves these sneakers, loves them most when we sell a lot of them. Our best technology and new shoe we Just Launched in january. Hes excited to have his image on the shoe. We all know you took the company over, what, 15, 14 years ago. It was nearly bankrupt. You decided to focus specifically on a running shoe, and its taken off from there because everybody is running these days. How much longer does that go . Is it cyclical or is the trend still growing strong . How is it working for you here . You know, i think the thing that makes running special and unique, its people really investing in themselves. The sport is the soul of it but it becomes much more than that. In our second decade of participation running. Marathons have hit 540,000 finishers in the u. S. Alone, up 45 and this is a global phenomenon. People are investing in their own health, wellness and fite necessary. I remember in high School Getting a bear of brooks because they had some sort of weird running alignment thing but they are a big heavy shoe. Where does that leave brooks in terms of being relevant to todays runner . You know, ill say i dont think weve ever been more develop rant to to todays runner and the some people like lightweight shoes and other people like a lot of cushion, and weve got a full range of shoes that work no matter how you run and what experience youre looking for, and i think were actually on the leading edge of that technology, so, you know, no matter how you run, we want to be out there with you, and well try to build gear that keeps you going. What did brooks make 100 years ago . I cant picture my ancestors jogging. Weve been all over the map from football, baseball cleats and, of course, running shoes. Weve run the gamut, but right now, you know, we want to be your choice when you go out for run, brooks gear. Very good. Well done. Good to see you. Congratulations on your success. By the way, speaking of anniversaries, as part of cnbcs 25th anniversary celebration well be unveiling the top 25 businesses and political influencers over the past 25 years starting tomorrow morning at 7 00 a. M. Eastern time and closing bell will be joined by a very special guest. One of these top 25 influencers. Those guests will be appearing on cnbc throughout the day tomorrow so hang around with us throughout the day and see all 25. The lineup is incredible. Of course it is. Kind of need to be a part of it. 15 minutes to go on the close and the dow holding up 112 point. The s p 500, the broad index up 10 and the nasdaq has turned around from sharp losses to down around 7 points. What to expect from two giants posting results tomorrow. Ebay and twitter. Thats coming up after the break. Plus, killer tornadoes are slamming several states. The latest developments are coming up in the next however the show. Keep it right here. T right here. Its what you love about her. But your erectile dysfunction that could be a question of blood flow. Cialis tadalafil for daily use helps you be Ready Anytime the moments right. You can be more confident in your ability to be ready. And the same cialis is the only daily ed tablet approved to treat ed and symptoms of bph, like needing to go frequently or urgently. Tell your doctor about all your medical conditions and medications, and ask if your heart is healthy enough for sexual activity. Do not take cialis if you take nitrates for chest pain, as this may cause an unsafe drop in blood pressure. Do not drink alcohol in excess with cialis. Side effects may include headache, upset stomach, delayed backache or muscle ache. To avoid longterm injury, seek immediate medical help for an erection lasting more than 4 hours. If you have any sudden decrease or loss in hearing or vision, or if you have any allergic reactions such as rash, hives, swelling of the lips, tongue or throat, or difficulty breathing or swallowing, stop taking cialis and get medical help right away. Ask your doctor about cialis for daily use and a 30tablet free trial. Thats why i got a new windows 2 in 1. It has exactly what i need for half of what i thought id pay. And i dont need to be online for it to work. It runs office, so i can do schedules and budgets and even menu changes. But its fun, too with touch, and tons of great apps for stuff like music, cause a good playlist is good for business. I need the bosss signature for this. Im the boss. Honestly i wanna see you be brave welcome back. Another week, another fleury of earnings here. Seema mody is previewing two of the heavy hitters reporting tomorrow, ebay and twitter. Seema. Thats right. Bill, lets start with twitter. Analysts estimating revenue of 240 million. Analysts say the key metric will be user growth, specifically monthly active users. Can this number beat expectations and support the still lofty multiple which the Company Trades at . Twitters Earnings Report comes ahead of the companys first major stock lockup expiration on may 5 when roughly 500 million shares will be eligible for sale. Now on to ebay set to report q1 Earnings Reporting earnings of 67 cents share of revenue of 4. 2 billion which would be a 13 jump year over year. The boost expected to come from the ecommerce and payments business. Kelly and bill. And that stock, too, such a battleground. Well be talking about some of the battle grounds when herbalife stock reports after the close. Pulling back a little bit from the highs of the day but the dow a healthy gain of 107 points and the nasdaq a victory of sorts, just being positive, any positive close right now. The tenyear still exactly where it was when i left. Nothing will move this thing. Incredible. Yeah. Were going to go live to arkansas coming up. Gotten an update on the deadly tornadoes that are sweeping across several states, doing a tremendous amount of damage. Well be right back. Be right ba. Peace of mind is important when youre running a successful business. So we provide it services you can rely on. With centurylink as your trusted it partner, youll experience reliable uptime for the network and services you depend on. Multilayered Security Solutions keep your information safe, and secure. And responsive dedicated support meets your needs, and eases your mind. Centurylink. Your link to whats next. The traders are glad kelly is back. Weve got eight minutes left. The dow is up 105. Joining us is sam stoval from capital iq. Depending on who you ask, weve had a lackluster season or its been better than expected because we keep beating expectations. Actually they are improving. S p capital iq numbers are showing a 1. 1 increase in this First Quarter. We were down as far as a minus 1. 2, and now were seeing technology, industrials, health care back in positive care try, so i would tend to say that, you know, maybe give credit to todays action on the earnings. For all of the work that it seems to take to achieve the growth. All it takes one movement back or forgot to move the market on a time. Well, i think because the most uncertain factor in the whole fact is what is boutin going to do and whats the response globally as a result of that, so i would say if he moves back to the border hed have another round of uncertainty and downward moves in the market. And earnings still to come. Were halfway through. Where are we . About halfway through right now. The expectation for the full year came down and then went back up. Its now a little bit above 7 for the full year, and were expecting to see Revenue Growth of about 3. 8 for the first half and then 4. 4 for the second half of this year, so good earnings and revenue numbers. Yeah. If we hit those numbers, especially on the revenue side. We know the pattern is typically look out to the second half of the year and everything looks rosie and as it approaches you mark everything down and you beat the lower bar. And then like wait until next year. Sounds like the brooklyn dodgers. Exactly. If thats what weve been doing the last couple of years and the market has been doing exceptionally well. The beginning of the year were looking out four to five quarters and feeling fairly optimistic. Now we have that uncertain period heading into the midterm elections and usually the best three quarters in the 16quarter president ial cycle is immediately thereafter. Comprehensive tax reform on the way, too. Within 28 days, bill, im sure of it. Thank you, sam. Thank you so much. Well come back with the closing countdown in just a moment as well. After the bell, bank of america shares are taking a big hit today. Thats the nasdaq, off 5 to 6 , suspending a planned dividend hike and the stock buyback over a mistake made during the feds stress test process. Process. Be right back. Youre watching cnbc, first in business worldwide. Back to the floor we go. Flo. [ male announcer ] great rates for great rides. Geico motorcycle, see how much you could save. To prove to you that aleve is the better choice for him, hes agreed to give it up. Thats today . [ male announcer ] well be with him all day as he goes back to taking tylenol. I was okay, but after lunch my knee started to hurt again. And now ive got to take more pills. Yup. Another pill stop. Can i get my aleve back yet . For my pain, i want my aleve. [ male announcer ] look for the easyopen red arthritis cap. Wbecame your business. Passion. At t can help simplify how you manage it. So you can focus on what you love most. When everyone and everything works together, business just sings. Who found a magic seashell. It told him what was happening on the Trading Floor in real time. The shell brought him great fame. But then, one day, he noticed that everybody could have a magic seashell. [ indistinct talking ] [ male announcer ] right there in their Trading Platform. [ indistinct talking continues ] [ male announcer ] so the magic shell went back to being a. Shell. Get live squawks right in your Trading Platform with think or swim from td ameritrade. Coming up on the last two minutes and a craze day on wall street. This is the definition of a round turn. That 100point rally on the open this morning kind of gaining back what we lost on friday and then it immediately sold. We were down for a time today and then gave it back. Up about 87 points off the highs right now. More stark with the nasdaq because for a time today after that little rally on the open we were down 1. 4 at the lows of the session before turning positive briefly for the time so a crazy day. Herbalife reports after the bell tonight. Been a lightning rod for controversy for the past year. Up 1. 6 ahead of those Earnings Reports coming out and bob pisani. Youre looking at ibm . Well, new tech versus old tech. Two twitter down and pandora down. Ibm up 1. 9 . A big reason why theres such a big move up in the dow. Theres 28 points for that. A big blue rally today. Thats right. A nice rally late in the day. Last hour and a half, there were reports out there that russia moved troops back to their barracks after supposedly the ukraine promised not to use force, so you can see little influences that the ukraine has, very hard to figure out the effects on the market and every once in a while you get a headline and suddenly the market moves on that. Still obviously and influence and nice that we bounced because 1 30 it looked like we were heading down pretty severely. Another day where the market was unable to hold on to a rally. We remember that the morning session is largely influenced by international traders, and then were left to our own devices the rest of the day. And pending home sales very good. Expecting 1 , had better than 3 gains. And that really helped overall in the morning. So you later, going out with a gain after a very volatile day. Big earningsnous coming out tomorrow morning from ebay and twitter. Herbalife coming up in just a morning. Hour number two. Shes back. Kelly evans and Company Coming your way right now. See you tomorrow, kelly. Thank you, bill. Welcome to the closing bell, everybody. Its 4 00 here. Were taking a look at how we finished up the day on wall street. The Dow Jones Industrial average staging a pretty nice comeback but not holding on to the highs of the session. Looking at 86 points, helped in pfizer in particular. The s p 500 adding 6 for the broad market, and the nasdaq which was all over the place today, down as much as 1. 5 , closing slightly negative. Losing about a point, 40. 74 is the level there. Noing joining me now our guests. Couple to all of you. I dont even know where to begin. At least there was merger monday news. How much animal spirits do you think that is going town leash into the markets . Saw the animal spirits at the open of the market, news not only from pfizer but the Comcast Charter deal for the 3. The million subscribers providing a lift underneath the market. Really the technicals midday that caused a bit of a breakdown and resurgence of optimism going into the close which is what carried us through to the end but the merger monday stuff, i mean, it was big but not enough to sustain the rally throughout the day. Art cashin was drawing attention to key levels, and it was interesting because the narrative seemed to change. This has been the case now for weeks, right . Every half hour it seems like people are writing the story for the day to tear it up having to go to something new. What do you make of the market overall here though . A sign of weakness or strength . Yeah. It really depends on the moment, doesnt it . But weve got geopolitical concerns and that news is coming in realtime and thats affecting Investment Managers and investors in how they want to address this market. Plus youve got earnings and a transforming fed and youve got some real big numbers coming up this week so i think thats whats driving it. I want to ask you about the fed in particular. Got to talk about whats happening along the border with ukraine. As much as we want to focus on earnings and the fed meeting. The market is sensitive to every foot and meter that troops seem to be approaching or withdrawing. We know they are not all that reliable. The economist said today war is peace. In a way its amazing that markets had been so relaxed over what could be perceived as an escalation towards war and the sanctions that the white house announced today, that treasury announced, tightened the noose a little bit but i was surprised how few oligarchs were on the list which suggests they are trying to hold back their fire for what could be some serious, you know, decisions down the road so i just dont think theres any good outcome in ukraine. The good news is there wasnt any terrible news or any mass troop movements but theres no good way out of this and it will just get worse. Markets are holding up reasonably well if you want to call that, and then throw the pending home sales on top of that and throw in the Federal Reserve on what they might do and how they might respond. How are we to read the macro tea leaves here . Keep a close eye on things like ukraine, russia, and it is as everyone else is saying very hard to predict day to day how that will play out. You have to keep that in the back of your mind, but when we look at the u. S. Economy in particular, there is a nice drum roll now that things are improving and from lower expectations from the end of the last quarter, so pending home sales nice. Theres a smaller data release, texas manufacturing. Look, you want to take a broad net and look at all the data point you can and dritriagnulat and leading indicators better than also expected, equipment and new orders. Steve grasso is just joining us off the floor as well. What do you make of the leadership in this market . Is it normal rotation into more normal parts as the bull market continues, or are they saying theres something to be worried about that the financial are lacking . A couple weeks ago we were saying how people were reaching for utilities and thought it was a sill thing, but the market was still moving up a little bit higher. Now we see people reaching for utilities out of safety, so i dont think its necessarily reaching for more mature names, more old school names or value. People are truly scared. They have no clue what to do with their money right now. Its all ukrainebased. All right. Youll ukrainebased. What did you make of the bank of america stuff, steve . Coming from a guy who has been long and got out of name last week, dumb luck, and today actually middle of the day i got back in. Really . Thinking that it was overdone. Look at it on a chart. It hasnt been through that 200day moving average since the middle of 2012 so for me risk reward, got back in. Only got back in 50 of the position that i had. Just thinking about maybe we get a pop. This could have happened to any other bank. This is a work in progress. No one has any idea what these metrics are. And every single career it gets harder and harder and even if you think you have it figured out you really dont as bank of america, citigroup, a lot of companies have started to think, but when you look at the overall financials, those were the biggest names of 2013 when the market was on a tear, when all the data looked like it was going in the right direction and the consumer, we thought, would borrow again. There would be a good demand for loans. This would be the year. We just didnt see, that so there really isnt much to like about the financials because of what we saw in earnings and because of this body data, not the place that a lot of investors, want to be right now. You dont think the m a activity wont make up for whats happening on the consumer loans . I think youll see some of that, big Bond Offerings and equity issues if someone like pfizer gains astrazeneca and the comcast time warner deal, a whole lot of banks splitting up that pie and if the regulatory landscape doesnt clear for at least a year, they wont get paid tomorrow. Even the reports about the omnicom deal. You cant count on it until it hits the account. When you see a large issuer cut their dividend, thats such a run for the hills moment, especially with bac, and i think investors are really getting a little dicy about a lot of the other issues like citigroup and thinking to themselves how can it sustain itself in the light of what the federal government is doing in light of all the backandforth negotiations with respect to major fines of fraud, et cetera, so its very disconcerting. Weve been underweight financials in our portfolio now for some time, and that has certainly not hurt us in terms of performance. My favorite part of the bank of america story today was the structured notes that was behind this restatement, and those are just the devils in the details. Youve got document that can literally be 60 to 100 pages of disclosures, and have you to read all the fine print. Looks like b of a inherited some of those, not reading some of the fine print early enough. Some are saying it let them off the hook and danny saying it made them run for the hills . Hitting the bank Balance Sheets, i dont think we can be confident were done with that. And this is not a real audit. They are not going over it with a finefoote comb, so to your statement how on earth, this is almost like lip service to the banks, you know, market capitalization. Youre not looking at something thats ft. Knocks anymore. Right. All on a relative basis. And to dannys point. Run for the hills point, the banks are too complicated to manage now. Having to weighed through 60 pages having to figure out your cap ratio, thats a scary thing and it goes back to the broader issue, are they too big and too complicated to manage and should shareholders just stay away . Some of the structured products was thought to be left for dead. It was thought to be kind of removed on. Gotten past this, kayla, clearly not the case so whose fault, and well talk more about this. Whose fault is it that its so complicated . What should the correct response be and where should the outrage be directed in that . This is something thats legacy from Merrill Lynch, not something that bank of america underwrote, something they inherited and you would think during the merger you know how quickly they tried to do Due Diligence on this company so quickly that as of a few weeks ago they are still getting sued. Five years, thats amazing. It is, but one of the things if you dont have to deal with it head on when you actually take it on, something youre basically just servicing and paying into and have in a portfolio somewhere, you dont have to revisit it all that often, so if youre not familiar with it when you buy it in the first place, no reason to go back and revisit it over the course of a few years. The question you have to ask yourself is are these banks capitalized enough in case theres a real shock that hits, and i think we can all agree upon that they are. Not something where we dont think that they are solid enough to maintain. We dont know what the next cataclysmic shock is going to be, but i would say that our bank system is as strong as its ever been. Hear that quite a bit. The disappointment of some shareholders here as well who wanted more capital return. Well leave it there for the time being. Thank you. Stick around and catch more of steve grasso coming up with more of the fast money crew at 5 00 p. M. Meantime, we need to get a check on the devastating tornadoes that have struck the midwest in the last 24 hours. More is spotted today. Nbcs jay gray is in arkansas with a look at the destruction. Jay . Reporter hey there, yeah, kelly. Want to give you a firsthand look at that devastation. This is the kind of debris field that stretches from miles across several states. Standing in what was the front door of an rv and auto center. You can see the debris piled up here. Believe it or not, there were three employees inside as the tornado started to move n. Rushed through the business, along with a stray cat it a they had been taking care of, opened this door and ran down into the basement. All of them survived. Thats the good news. When they walked out though, this is what they saw, very little left of the building, the lot where they had more than 60 vehicles, very little left there other than twisted metal, shattered glass and splintered wood, and, again this, scene is playing out across several states right now, and concern, kelly, that the worst of the Severe Weather is not over. Forecasters warning today that more tornadoes are likely over the next several days in an area from louisiana all the way through ohio so as they start to clean up here and as they continue to mourn those lost, they also have an eye towards the sky here to see what may come next. Its a tough go right now. And it must be such a tough feeling as well, jay. Thank you very much. Appreciate the coverage. Yeah. Bank of america suspending its stock buyback, dividend hike plans that miscalculated some numbers when working on the fed stress test. Shares taking a hit today on the news and as we discuss who at the company should be held responsible, more on that next. Herbalife earnings are due out any moment now. Instant analysis of the results. Herb greenberg will give us his take on the numbers. You do not want to miss that. Youre watching cnbc, first in business worldwide. Ss worldwide. Welcome back. Buffalo wild wings out with earnings. Dominic has results. Dom . Check out whats happened with the stock because the stock has moved higher in the after hours after the Company Posted better than expected earnings and sales and also raised Earnings Growth estimates for the full year. You can see the stock is currently trading up about 5 in the after market trade. A different story for the container store. I have survived the Buffalo Wild Wings challenge on numerous occasions. Thank you, dom. Sure. Kayla, i want to talk in particular about what weve learned about the capital at this company, one of the biggest u. S. Banks today. We were just discussing this issue. Bank of america coming out this morning and suspending its capital plan. Steve grasso mentioned that the u. S. Banking system is better capitalized than its ever been, and i want to pull up some charts. Still 8. 5 for bank of america, down three capital levels. If you can pull up the chart in the rundown there. There you go. Tier one capital becomes 9 , down by about 27 basis points and tier one common down to 1. 6 and down by about as much. Down by whats required by regulators so right now they are still completely well capitalized and still a safe bank. The problem is the fed in its stress test makes them really stress their portfolios and if stocks fell by 50 , if unemployment fell, what would happen to the portfolio in a really extreme portfolio. If theres a chance that this might cause you to fail the test, may not use that to get it back to shareholders. Not that bank of america is in any more of a dangerous situation because of the way that this particular type of note is valued. It actually might cause them to in effect fail the test. 30 days to figure it out and some analysts have come out and said that they believe bank of america will pass when they resubmit and others say they wont and we dont know until we hear what the fed says on this. Mike mayo joins us, good to see you. Is bank of america going to pass the stress test . Lets look at the bigger issue here. Two weeks ago bank of america had earnings that report showed less earnings power and you mentioned that. One week ago there was reports of a possible legal adjustment at the Justice Department and today we find that bank of america annual meeting in charlotte on april 7th and ill be asking the question is bank of america too big and complex to manage . Thats the bigger issue . The point robert frank was just making. I guess i wonder. Do you think somebody else should be in moynihans chair right now or is it structurally these are too big . Are you implying that somebody else could do a better job . Since the crisis were relying on the regulators, and i think thats a middle ground and thats to better hold the board of directors more accountable. The chairman, what is he doing, what did he know and when did he know it . After seeing several rooms over the course of several decades, at some point you say what are the people overseeing the ceos doing to reassure investors . Quick question for you. You know, bank of america right now is negotiating with the Justice Department and they said we want to fine you 20 billion and they are going back to the drawing board. Does this issue light that on file . Does this make the regulators go back and say we maybe should up the ante because of whats happening . I dont know how as an analyst thats covered the industry for 25 years youre supposed to model in our earnings skimts these legal charges. They are so lumpy. You saw bank of america preannounce a couple billion dollars. Have they mattered, because so much still seems to go back to how the economy is and where the tenyear is . Its multifactorial. The question is bank of america kwutdor cutting fad and some of its meets and some of its controls . Thats the question. Pretty soon youre talking 20 billion. Make of america has always been so conservative because they knew the legal charges were waiting out there in the wings and almost every other quarter we see one of the settlements completely wipe away what they were supposed to have earned that quarter. Now we see them with this 4 billion buyback. Upping their dividend to a nickel for the First Time Since the crisis. How did bank of america get so ahead of itself when its been trying to be so conservative for the last several years . Well, that goes back to the first question. Bank of america has 2 trillion of assets. Its been multiples bigger than it was a decade ago precrisis. How can you get your arms around a company such as that. Trying to be conservative. Just dont think they are able to do so. You cant take the legal charges until they are likely and you can estimate them so i still think theres more charges still to come. Are you going to lay the blame at the feet of the chairman, he should have responsibility for this or is it strictly unmanageable in. We need to hold accountable the board of directors and the chairman to see what kind of assurance he can provide. The ceo and management dealt a bad hand, a tough position to manage. Having said that, could they have done better and done better with investors in the excfo of bank of america settled with the government for not disclosing more of the losses at Merrill Lynch. This isnt the first time that bank of america has got ebb its numbers wrong. Bottom line, mike, what should investors do here. Exactly. Briefly here. Sell bank of america. And buy what . Buy citigroup, 80 discount to tangible book and bank of america at a premium. We could keep this going so much longer. Thank you for your time. Appreciate it. That was mike mayo. Always considered a fiscal dove so why do many think her fed will be more aggressive hiking Interest Rates more so than previously thought and the white house slapping new sanctions on russian president Vladimir Putin and his closest allies . Well discuss whether the only way to stop the aggression is by punishing putin personally . Well be right back. Out there, e right ba1 tdd 18886486021 there are stocks on the move. Tdd 18886486021 in here, streetsmart edge has tdd 18886486021 chart pattern recognition tdd 18886486021 which shows you which ones are bullish or bearish. Tdd 18886486021 now, earn 300 commissionfree online trades. Tdd 18886486021 call 18886486021 tdd 18886486021 or go to schwab. 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Find your sleep number setting only at a sleep number store. Know better sleep with sleep number. Theyre the days to take care of business. When possibilities become reality. With centurylink as your trusted partner, our visionary Cloud Infrastructure and Global Broadband network free you to focus on what matters. With Custom Communications solutions and responsive, dedicated support, we constantly evolve to meet your needs. Every day of the week. Centurylink® your link to whats next. Welcome back. Fed chair janet yellen generally viewed as dovish when it comes to policy and why are they being viewed more hawkish now . Steve liesman joins us now. What does the new survey tell us . Tells us were looking at higher rates than the last survey. What you see here is that were now looking for a 1 fed funds rate in 2015. Thats up from 0. 82. By the way, it goes along with the feds own increase and their own outlook, what we get from the Economic Projections that the fed puts out. First rake hike, july 15, about where we thought it was prior surveys. Take a look another place where they are somewhat more hawkish. We ask people if youre wrong about the federal forecast, how do you think youre wrong . Will the fed be more dovish than you expect, more hawkish or is it balanced . 50 think that the fed in 14 and 15 could be more dover than they expect but look at here, 15, 40 compared to 21 are worried about a more hawkish fed in 2015. Perhaps thats because of growth. Take a look at some of our results from Economic Growth projections. The lowest probably that weve ever recorded in the entire years that weve been doing the survey, 14. 6 , average probably of recession in the next 12 months. That goes along, guys, with somewhat higher growth forecasts for next year, along with this year here. Go to the next one, 3. 7 , there it is right there, 2. 7 growth forecast for this year, going up to 3 next year. That would make sense to go along with a somewhat higher forecast for the fed funds rate. Back to you. Yeah, it certainly would, steve. Thank you. Rebecca, just pointing out as well. A lot of different ways of trying to gauge what consensus is here. How does what the cnbc survey, how does that parry with what your own expectations are here . Steve highlight that had his survey is more hawkish than past months and also probably the broader consensus. Fed fund futures, so the markets view is well have a market rate of 74 basis points at the end of 2015. Steve, i think you said your survey said thats coming sooner. One thing thats interesting about what the fed itself is doing. Its changing its questions every month. So its trying to really get inside whats driving peoples expectations . Is that new . I havent been a very longtime participant but to the degree ive been participating, somewhat new to me. Trying to understand if Inflation Expectations are x, whats driving the view they are getting there . You can tell things from the questions. Are they asking about expectations now . Trying to get a handle on i mean, the fed is looking at not actual expectation but also Inflation Expectation so it wants to know what are the variables that will change my expectations so they are trying to get a leading indicate orr on a leading indicator . What i can tell is a person who designs the survey. Trying to figure out what Market Expectations are for something that cant be quantified. The reason we launched this survey three years ago is because the fed funds rate future market didnt matter anymore, okay . And there was no way to gauge Market Expectations for what the fed would do. Only by polling the street can we come up with what people expect for the Balance Sheet and for total qe and just for the record were expecting a decline in the Balance Sheet next year of 150 billion so thats something well have to follow as gauging Market Expectations for the fed. Its not just when the fed funds start going up but when does the Balance Sheet start coming down and by how much . Right. I think thats a great question. Another policy term. The fed has been doing this and changing its survey from them. Taken stuff from them and we from them. We release our fed survey results before the results. And with the fed meeting coming up and starting tomorrow and ending wednesday, what do people expect from this one . I think its going to be a little bit pedestrian i guess is the best way to put it. Not a lot of huge headlines. Looking at if they need to tweak it forward, maybe some comments on the labor market will be interesting, but what weve seen and gotten conditioned to is big changes will happen because the fed wants to answer questions about them. Thank you, steve. Pleasure. Lets send it over to dominic for a market flash. Inflight wifi, its losing ground on news that at t is planning on launching a high speed lte, longterm evolutionbased Economy Service for airlines and its passengers. It will happen by late 2015. Gogo shares down 15 in afterhours trading, 77,000 shares trading so far. At t, the action there up very marginally. Call it flat and gogo under pressure on Inflight Connectivity from the likes of at t. Back to you, kelly. President obama announcing a new round of sanctions against top russian officials but once again they dont personally impact president Vladimir Putin. Why is that, and will he need to feel the pain before we stops aggression and guess who will cash in on aflac. Aflac, aflac, aflac [ both sigh ] ugh you told me he was good, dude. Yeah he stinks at golf. But he was great at getting my claim paid fast. How fast . Mine got paid in 4 days. Wow. Thats awesome. Is that legal . Big fat no. [ male announcer ] find out how fast aflac can pay you at aflac. Com. [ maltoday is mondayind out how fast aflac can pay you today, we greet you. Treat you. Care for you. Today, you can come to Cleveland Clinic for anything, everything or just to get that thing checked out. Big, small, and yes, the best heart care in the nation. Its here everyday, for everyone. Thats the power the power, thats the power of today. Cleveland clinic. Call today, for an appointment today. Herbalifes Quarterly Earnings result are out and dominic has the numbers. Herbalife shares, you should know right now are up about 3 on 120,000 shares of volume in the after hours trade. The headline number is 1. 50 in terms of earnings per share beating the average estimate and sales come in slightly better 1. 26 billion versus 1. 24 billion. With regard to next quarter, the current quarter, their earnings per share guidance comes in a little bit below analyst estimates but the full year comes in for an estimate of between 610 to 630 per share versus analyst estimates of 6. 04, so better fullyear Earnings Guidance than analysts were expecting. Also full year Net Sales Growth expected to be between 10 and 12 versus 10 estimates from wall street analysts and herbalife has suspended its dividend, so, again, earnings beat, sales slight beat and fullyear forecast beat on both sales and on profits, and herbalife is suspending its dividend. Kell, back over to you. Dom, thank you very much. We also have a tweet from carl icahn saying great move by hlf to suspend its dividend and buyback shares. It accelerates the return to shareholders. Confirms confidence in the future. Lets see if his comments are echoed by herb greenberg, cnbc contributor who we bring in now. Looking through the results now, herb, what do you make of it . If you were just looking at this from a headline number perspective and suspect if you want the buyback and prefer that to the dividend, wow, heck of a quarter and i keep saying with the under and overlay with Everything Else going on, whether the company had missed, beat or exceeded expectations, you would just say or just met expectations you would say it doesnt matter because we still have to see how these numbers are generated and whether the Business Model that they were generated by is a Business Model that can be sustained once the investigations are over. So, herb, what youre saying, we still have to see. Do we have to see what happens from the federal governments point of view, regulators point of view or just the earnings power of this business . No. We know what the earnings power of the business as it stands now is, and im looking at other numbers in here, including the the average the growth and active sales leaders. 40 growth in china which is a big Growth Market for them. 9 growth in north america. Both good results for them. That doesnt matter if the government comes in and does nothing more than revise the rules as they apply to multilevel marketers and cause them to have to reset their Business Models because that would cause all this growth to perhaps change. Certainly in north america and in the United States. But, herb which is 20 of the business. The fact that they are trading their dividend for a buyback at this point would signal to the market that they believe their shares are undervalued. They are raising their guidance for the full year. It seems that they have confidence in their business and maybe they believe that the investigation will turn up nothing. I mean, what do you make of the news of how they are switching up the shareholder returns . Well, kayla, of course they would say that and, of course, they would think that. You have to if i were running the business, i guess i would do the same thing, except how Many Companies have we seen that use the same buyback ploy and announce a buyback of shares. How many times have we seen that and then we look back a long time later and see that they really didnt do that that was a peak of a market and by the way, just because you say youre going to buy back shares, doesnt mean youll buy back shares. Sound like what youre saying its a Good Business until its declared illegal basically. What do you make of when were switching to bill ackman for a little bit heer and i wonder to what extent he could become a victim of his own success. Got the news out that hes paying a former herbalife employee or could be potentially millions of dollars over a tenyear period which raises some questions about whether hes sort of spending too much and influencing government and people too much on his crusade on the short side. Well, i think, you know, his tactics are bills tactics. Not something certainly a journalist would do, but i think that maybe the perspective of is that information correct . When im looking at it i just want to know so the ends justify the means for you. Whats that . Well, in this case with this company trying to find out if theres really something going on, you know, thats up to him to determine how hes going to do it. I just want to know something. I want to know if this company is on the you and up. Ackman as this documentary hell put out on friday with a big presentation, showing people talking about, according to the trailer, how much money they have lost trying to engage in the herbalife business. Look, there are two sides to this, but we know that theres some significant questions based even on the cnbc investigation into this. It is kind of amazing though amidst all of this the business is so Strong Quarter in and quarter out. I want to point that out. Take Everything Else away, you say heck, heck of a business. Thank you, herb. That may explain why the shares are up a tenth of 1 responding to that earnings beat. The Obama Administration unveiling another round of sanctions targeting russian government officials and companies linked to russian president Vladimir Putin and his inner circle. John harwood has the details for us from the nations capital. Reporter kelly, the new sanctions confirm, in case there was any doubt, that that agreement to deescalate between the United States, russia, the eu and ukraine a couple of weeks ago was worthless because russia wasnt interested in deescalating at all. So whats now happened is seven additional individuals close to Vladimir Putin, though not putin himself, 17 entities close to some of those people and people who had been sanctioned earlier, are also subject to sanctions. The United States is barring the export of some hightech defense equipment to russia, which might contribute to their military capabilities, and jack lew, the treasury secretary, told our Andrea Mitchell this afternoon that this is an attempt, even though they havent deterred russia so far, to gradually increase the pressure. These are very important sanctions. They are sanctioned that will get their attention. I think that our goal is to move in a systematic way in, a careful way, in a way that also gives them a chance to change their policy and take a different course. Our goal here is obviously not to hurt the russian people. Its to get them to change their policy. Now the end game, if russia does not change its policies, is broad sectoral sanctions, especially on the energy sector. Europe has not been willing to go that far yet. The United States hasnt been either, but if they cross the red line, the United States has been painting in eastern ukraine, having lost the advantage or the ability to reverse the invasion of crimea, then that will be put to the test and well see whether or not that can be effective . While sanctions may be in place, doesnt mean that putin will feel their effect. The New York Times today has a story about putins billions saying he could be the wealthiest head of state in the world. If youre a regular cnbc viewer you know our own robert frank has been way ahead of this story so will putin be feeling enough of a pinch even with the new sanctions . Its interesting, and i wonder what john thinks of this. Initially there was a lot of focus on the fortune of putin and going after the oligarchs and now they have pulled back. Some oligarchs floated over the weekend that didnt get named and now they are talking about sort of Public Officials that will be sanctioned, not companies or oligarchs, and it just seems to me, jack lews statement saying we are not going after putin himself, putting that right out there, that were not going to target him and his fortune. John, i wonder what you think, whether there may be a slight shift away from that perhaps as an olive branch to allow him room to change his position here . Well, everything, robert, about the u. S. Strategy has been consistent with the idea that a gradual ratcheting up is going to be more effective than in essence firing all your ammunition at once. Hasnt worked so far. It may be taking a toll on the russian economy. Certainly some of the financial analysts weve talked to think its hurting the russian economy, but its not producing shortterm results so how long can the United States hold out from doing something more severe . Thats going to be tested the next few days. The trouble, of course, is any sanctions that hurt russias economy by definition are going to hurt especially europe and the global economy. Its an unfortunate situation. Not like youre trying to isolate a country like iran thats less intertwined with the economy and less big as a share of gdp in general. Exactly. No, with any other economy already at this point we would have so much pressure on the leader, russias stock market down more than 20 year to date. The russian ruble collapsing and the central bank being forced to hike rates very aggressively. Russia is likely to have a recession, possibly a deep one this year, but to Roberts Point earlier, if most of the people who handle russias money have gotten a good chunk of that money overseas, do they care really who this hurts, its the middle class or those who could afford to have a few local shares. How long does it take before they take on putin because right now his popularity is very, very high. John . Well, look, if you inflict severe enough pain on the russian economy overall, eventually that is going to have an impact on the leader of the country, whether its a democracy or not. No, but does it turn his people, john, against him . What rebecca is saying, if anything, this has coalesced support for putin. Not like iran where all of a sudden you have rouhani that comes into power as a result. Thats my point. It takes some time so theres an immediate real around Vladimir Putin effect, just like in our country when you have a military confrontation. People rally around the commander in chief. The same thing is happening in russia. The question is whats the duration of that and how long does it take . My point is if you do inflict sustained damage on the economy, i think thats ultimately going to put pressure on putin, even if hes not a democratically elected leader in the way we think of a democracy. Just not a normal economy. So much wealth in russia is concentrated among 50 billionaires that unless you target those 50 people, youre just not going to have a big impact on thats whats going on in that economy. Does seem tonight direction that this is headed. Thank you, john and robert. You bet. Back at least on television. He hasnt been heard of since he left his postas coshow at pimco but theres the hot list fire today and still ahead. Another comeback in the making, manufacturing in the United States. Well have the how and why coming after this. Ngfter this. [ man 1 ] were now in the approach phase, everything looking good. Velocity 1,200 feet per second. [ man 2 ] youre looking great to us, eagle. 2,000 feet. Still looking very good. 1,400 feet. [ male announcer ] a funny thing happens when you shoot for the moon. Ahh, thats affirmative. [ male announcer ] you get there. Youre a go for landing, over. [ male announcer ] the all new cadillac cts, the 2014 motor trend car of the year. Welcome back. Stocks may be headed to a rude awakening according to the former ceo of pimco. For more we welcome back allen wasler from vacation, werent in the same place, it should be noted. Whats on the hot list . Surprise popped up in the last hour here. Did a pickup from our partners at usa today. They went through all the Earnings Reports and where most of us concentrate on growth, they looked at shrinkage, and they have a list of 11 companies that are the great shrinking companies over the last three years, so, you know, names like staples, best buy, avon in there, interesting little piece and our readers are just diving into it. Now, you mentioned mohammed el alaran. We have him partnered up with one of the chiefs from apollo, Joshua Harris. Both of them are warning that the markets sort of arent pricing in some things and that, you know, stocks can get a rude awakening on mohammeds part and for Joshua Harris he says everything is overvalued. Boast those stories are pulling tremendously and i expect them to pull all the way into the evening because thats what it looks like right now. Quick question, when were talking about companies which have shrunk, were not talking about the share flow but the actual businesses. Measuring mostly revenue takes for each year and have done a little bit of seasonality to level the results. Pretty fascinating. Investors always get obsessed by growth but want to check your portfolio to see whats not growing so well anymore. Good to see you. Thank you, kelly. Its been said that the United States doesnt make anything anymore. Well, a new study contends that thats changing and that the u. S. May be set for a manufacturing comeback. Thats next. And you voted. We counted. Tomorrow all day as part of cnbcs 25th anniversary well reveal the first 25. That list of influential leaders who have influenced businesses over the past quarter century. So dont miss a moment of it. Well be right back. I bought a car, comes over. And youre like. If youre getting. A good deal or not. Led up. Truecar. Com. All the information. You should be paying. You know, and with truecar. Com, my feeling is that. We got a fair price. Theres no buyers remorse, you know. Im happy with my purchase. Its the truth. When youre ready to buy a car, save time, save money, and never overpay. Visit truecar. Com dewhos got twond rhooves and just got ae. Claim status update from geico . This guy, thats who. Sfx bing. And i just got a. Oh no, thats mom. Sorry. Claim status updates. Just a tap away on the geico app. Also growing that list here mercedesbenz is also suspending at least for the time being its Marketing Relationship with the clippers. Youve also got other big names as well, including sprint, the Telecom Giant here in the u. S. Thats also for the time being suspending its Marketing Relationship with the l. A. Clippers, so the list just keeps on growing. More details for all of these companies. Remember, tune into this show tomorrow because on the closing bell we will have sprint ceo dan hessey who will be first on cnbc tomorrow on kwebclosing b hell talk about some concerns about sprint and what it feels about the l. A. Clippers Donald Sterling situation so well all be tuned in for that interview. Tomorrow and every other day. Lets bring in the man behind the report, Boston Consultant Group senior partner hal sirkin. This is a theme out there for quite some time. Youre saying the cost gap between china and the u. S. Has narrowed to just five points and thats before transportation costs so effectively its cheaper to make things here. Seen a massive change. Used to be a few years ago that china was 14 or 15point advantage and now its down to four or five points and its starting to change the way manufacturers behave. Well, the trouble though its not moving the needle quite enough on the employment front. We still peaked in this country around 17. 5 Million Manufacturing jobs in 1998. At 12 million today, hal. Do you think that that will start to follow, or is it just that were starting to get the gdp benefit but not the Employment Benefit . Already seen manufacturing jobs increase so were seeing some increase already and youve got to recognize that it will take three, three and a half years to get a manufacturing plant up and running in the United States so we have a long way to go before you see the full impact of whats taking place, but that cost difference is dramatic and it will change economics around the world. This is a dynamic equation, of course. If we get the dollar strengthening along with rights yields in the u. S. , now china looks like its trying to actually weaken, its really the first time they have done this in a material way since 2005 or before, how quickly could that change the findings . Well, of course, economics change all the time. On the other hand, china still has a currency that most economists believe is not valued correctly so they will have to do something about that, and, of course, Interest Rates will make some differences, but countries tend to adjust to each other. Hal, when you looked at your report, as to what specific factors were helping the u. S. , you cited Natural Gas Prices as the big one and also basically stable or some would say stagnant wages. Right. So rank those two for me and what else is helping the u. S. Right now . We really have four things that are helping the u. S. One something that is relatively stable wages and the other is growth in productivity. You have Exchange Rates that are favorable, and we have electricity and all energy costs that are also part of this so they all come together for a very good tailwind for the u. S. , at least for now. No four horsemen there. Thank you, hal. Thank you. Good to see you and having someone trying to quantify this discussion. Up next, final thoughts on today and what to watch for in markets tomorrow, including earnings from social media giant twitter, the online retailer ebay. Well be right back. Be right ba. First day of my life by bright eyes be right ba. Youre not just looking for a house. Youre looking for a place for your life to happen. [ female announcer ] the sun powers life. And now it powers our latest innovation. Introducing the worlds only solarpowered home energy system, which can cut your heating and cooling bills in half. Call now to get up to 1,700 dollars back or special financing on select lennox home comfort systems. Offer ends june 13th. Plus download our free lennox mobile app with an energysavings calculator. If your Current System is 10 years or older, start planning now and take advantage of special financing. So call now to get up to 1,700 dollars back or special financing on select lennox home comfort systems. Offer ends june 13th. And download our free lennox mobile app. Lennox. Innovation never felt so good. Welcome back. More news. Lets send it to dominick. Check out zillow climbing about 4 . Hedge fund tiger disclosed a 9. 5 stake in the company. Zillow up about 4 in the after market trade. Back over to you. Want to get final thought from the panel. Is it the fed meeting . I think its the markets. I think its equity specifically. I would say im staying over u. S. Equities. I think if russia gets worse the u. S. Is relatively less exposed. All of these kind of sages are coming out and saying theyre concerned. Thats what makes a market. There are parts that are topee. Some small stocks are undervalued. You have to look under the hood. Whats under the hood . Look at the ip market, thats really tailed off. I think we still got to make the play. The u. S. Equity market is the place to be. Probably time to take a good look and maybe doubletriple down. Wow. A lot of this will depend on what happens with russia. Yeah. I think the market is not pricing in a total collapse of the russian economy. Which is possible. It will be interesting to see if we see a breakout this week. Fast money is coming up. Melissa lee, are you talking ten year, the vicks . Hello. Thats a good looking dress, kelly. The free willys theme song. Heres what were talking about, theres been a lot of pharma and biotech. We have got three names and well tell you whether or not the options activity backs them up as potential targets. Over to you guys. Fast money starts right now. In new york citys times square. Our traders tonight. Coming up. Well get the latest move from dennis and hes been changing his strategy over the last month as the market has become more volatile. Still be pleasantly long. Not