Transcripts For CNBC Closing Bell 20141008

Rallying and the 10year moving high owner the fact that the fed if anything worried about inflation and growth move, i mean, try to put it altogether and create a coherent narrative. I cant. Maybe the panel can. We have other news but first of all keep an eye on this level. 1962 was yesterdays high on the s p 500 index. Write that down. We took out yesterdays low on the open this morning. If we were to close above yesterdays high, technicians call ate key reversal day and would put a potentially bullish move for the markets. If we get a push higher here in the hour and see what apples doing because carl icahn put out now very sophisticated with the tweets. He is tweeting of what to tweet about. Well, thats true. Thats true. Almost like we have to watch his communication strategy as much as he tweeted out to send an open letter to tim cook, ceo tim cook, tomorrow. With all of the agitation at apple, the stock is up 50 in the time. Hes going to send an open letter to tim cook tomorrow and he said should be interesting. And the stock is up 2 right now so well see what thats about tomorrow. And will be on fast money tomorrow, as well. That should also be interesting. Thats coming up tomorrow. As we get into the final hour of trade here, market with the dow up 205 points. Again, after yesterdays decline of about 270. Lets see what our panel has to make of all of this. Lets get to the Closing Bell Exchange with dear friends. Keith fitzgerald, jack barucian, kim forrest and we have Steve Liesman and Rick Santelli standing by. Steve. I start with you. Give us the hits, runs and errors of the fed minutes ma sent the market higher. A couple quick takeaways, bill. The concern of global output and the impact of the dollar, and that potentially lowers the inflation which the unsuccessfully hitting a target and not making it and then an appreciating dollar could make it harder. Note that the fed staff, something we follow closely, they said that the fed may not hit the 2 inflation target for several years and could be below that number and changes the outlook. I think what it does, bill, my estimation, takes off the table that spring rate hike the market was concerned about. Probably reasserts the consensus being mid2015 assuming the economy doesnt take a big tidal wave of overseas with the economic weakness there. Lets take the u. S. Dollar and the impact all this might have. Rick santelli, maybe you can explain it. We were arguing about it a little while ago. Is the u. S. Dollar rallying because the fed is expected the move quickly, rallying because the u. S. Looks like the only place for growth in the world and continue this effect, do you think . Well, you know, a lot of the economies in europe in quicksand pretty soon will only see the top of their bowlers and just like were the cleanest shirt in the hamper, dollars cleanest currency in the hamper, sort to speak. Ill contend milt freedman, i dont care, take the dismal scientists, the reason there isnt higher prices because higher prices are going to be brought along with better growth. Okay . And lower prices are going to be brought along with weaker growth as in europe. Michelle ka carusocabrera said it best. We need to prevent them from going down. I defy anybody to go through the minutes of the last meeting or, excuse me, go through the statement of the last meeting or the press conference that the minutes released to today. Boy, the dollar and the european markets not underscored and highlighted and the central case of the conversation which means that they were right, the fed finding anything not to norm normalize rates. We have waded through the weeds. Lets make it meaningful to investors now. Keith fitzgerald, are you going to were you buying yesterdays selloff or are you selling todays rally . What are you doing there . Well, certainly is a conundrum. I think this is all about the fed, bill. Never met a Printing Press they didnt like and a dove they didnt want to set free. I think the market likes that. Good ceos are moving ahead. I think profits are still there. Profits translate. I think we may have a little run higher after all this. One day does not a trend make so im cautious in here. Jack, you agree . I do. In fact, yesterdays action indicative of a bull market break. You see fear and panic and then de doomsdayers. Corporate america is still strong. The earnings season is the key and tell us whether we will have a run in the last couple of months up to 2150 or maybe a move to 20, 2012. Were looking at a buying opportunity a. Vshaped bottom. Every three months this happens. This is another Good Opportunity to find value. Yeah. I mean, we keep wondering whether 5 is the new 10 in terms of defining corrections and whether today is a bottom. Well know in the fullness of time. Kim, what about oil and its role . It continues lower. Is that good for the market . Is it bad for the market . What are you doing with energy right now . I think energy is probably the most confusing. Actually, no. Energy and gold are just very, very confusing. Arent they . Yep. From a demand perspective, i dont know that the developing world is really demanding oil and thats certainly pushing the worldwide price down. In the u. S. , we have the shale phenomenon. Its adding to, you know, the problem about pushing the prices down. But its extremely interesting and it really does take pressure off of the consumer which i think for stock pickers you have to Pay Attention to that. That really is one of the Drivers Behind the light inflation is, you know, the basics like oil going down. That makes everybody who drives have a little sigh of relief. I know i do. Sure. Yeah. So, you know, you really have to Pay Attention to that. Rick and we are. And sorry, kim. I was just you made me think of something weve been talking about with rick, as well. We have the u. S. Economy, rick, performing so well and inflation just isnt there and perhaps it is partly because of whens going on around the world but i wonder what do you think the response then should be from the central bank or the federal government or nobody . Do we just connect in the fullness of time it comes back and dont worry about it or not qu what . Me . It was for rick. Sorry. Go ahead. I think higher prices or lower prices are a byproduct of growth or no growth. As simple of that. I think with regard to what you said about a u. S. Economy, yeah, its doing pretty good, kelly, but based on six years after and other postrecession activity, it really doesnt stack up and i think that the best evidence to give you being in the weeds like i am, bill, is the fact that we dont have productivity like we used to have and starts to build up and get stored and thats what the problem with the japanese economy is. Theyre never going to be able to tinker with enough levers. Kelly . Wait a second. Kelly . Like to just with due respect to my excellent colleague in chicago, id like to point out theres not a lot of evidence that growth is per se inflationary. Quoting larry kudlow. Steve, whatever. That growth can be actually deflationary and creating capacity. Yeah, sure. And the other side lack of growth that could be inflationary destroying capacity. Im not sure thats the test tube to put it in. Great. Defend, defend. Actually, kim, you have ideas about productivity, ways to play the space. What do you see out there . Productivity never, ever goes out of style. So, we look to tech and especially tech that is focused on corporate sort of solutions and then industrials. You know . Both of those are all about making a worker more productive and i dont think that ever, ever goes out of fashion. What were you going to say, jack . You know, one of the things i was going to say is im worried that the yield in the 10year and treasuries to do what its been doing all year and keeping people out of stocks and rick and i have had this debate back and forth. People can walk and chew gum, jack. Cant they belong to both . You believe that but not everybody else. The biggest competition. Come on. Capital is the fixed income market. You know that. Yeah. Thats one of the reasons that every time this happens, you end up with people out of the market. Thats one of the reasons why this jack, isnt there something helping snout. Theres a simpler explanation. In the sense that the stocks rise with this sense of all the money in the bond market thats seeking shelter and thats actually a Building Block for the bull market. Again, a lot of unbelievers out there. Right. Thats good for stocks. Youre also talking about people losing purchasing power, parody with equities. If they stay in cash or bonds which is all risk and no return at these levels. Come on. Middle class, doesnt have a position no, no, in. In either market. Its not position in either market. Jack, jack, it is not all risk and return listening to rick. He has a 180 bottom call on the 10, dont you, rick . Capital preservation at this point. Thats all it is. Keith . Dont forget theres a third element here. You know, the individual consumer is still scared. Jobs are still scared. Job parody, wages. Of course. Its economic cracks in the market. What this is all about is the fed pushing money into the big banks and the system and provides liquidity that chairman bernanke and yellen tried all right. Tim . Its all about confidence. We cant get loans out. You know . Loans arent going. Hello . Ben cant get aloer. The middle class keeps voting in the lyiberals that make the rich get richer. Ironic situation in history. Stop me there. Too close to a election. Were way over time and we have to ask about apple and what carl icahn may have up his sleeve. Kim, what is your view of apple . What do you think hes doing with the position of his . I think icahn at the huge pile of cash that apple says and give me some. Im a shareholder. I dont believe tim cook is going to bow to that but i love to see the drama play out. We dont own apple at this point. You know, i like a little more i dont know less dependence on consumers in my Technology Port foal yes. All right. I like to see apple at 70. Who said at 70 . Me, keith. Id love to see it at 70. The company doesnt have innovation left and see the weeds knocked out of it. Cut the lawn. Get back to real value and then start moving forward. All right. Understood. Thats what makes a market. Thank you, everybody. Thank you. Dont forget carl icahn with scott tomorrow. Right here at 3 00 eastern time, the rally continues. The dow with 50 minutes left in trading, up 210. Healthy gain of 1. 25 . The action yesterday has us wondering, are shorts tryinging to win or in danger of getting squeezed here . Well talk about positioning coming up. Jcpenney with the First Investor day in three years and hear from somebody that says investors would be smart to shop for shares of that retailer. What she says are cheap. Plus, ask you, do you think jcpenney will achieve their turn around . Your chance to vote on cnbc. Com vote is just ahead. Up next, he turned down a kings random from time warner because they wanted too much control. Vice ceo shane smith after the break. Stay with us. You know what my business philosophy is, reynolds . No. Not exactly. To attain success, one must project success. Thats why we use fedex one rate. Their flat rate shipping. Exactly. It makes us look topnotch but we know its affordable. [ garage door opening ] [ sighs ] honey, havent i asked you to please use the we dont have a reception entrance. [ male announcer ] ship a pak via Fedex Express saver® for as low as 7. 50. And youll see just how much it has to offer, especially if youre thinking of moving an old 401 k to a fidelity ira. It gives you a wide range of investment options. And the free help you need to make sure your investments fit your goals and what youre really investing for. Tap into the full power of your fidelity green line. Call today and well make it easy to move that old 401 k to a fidelity rollover ira. Ghave a nice flight r bag right here. Traveling can feel like one big mystery. Youre never quite sure what is coming your way. But when youve got an entire company who knows that the most ontime flights are nothing if we cant get your things there too. Its no wonder more People Choose delta than any other airline. Welcome back. Some sad news of dallas today. The ebola patient in that city dying from that virus. Meg terrell is covering that story in a great way. She has the latest now. She is in philadelphia where a pe meeting is taking place. Meg . Reporter thats right, guys. We learned this morning that thomas eric duncan, the only patient to have been diagnosed with ebola on u. S. Soil passed away today. Now, we have been talking with a lot of Infectious Disease specialists here in philadelphia, noting the length of time before mr. Duncan was treated was problematic and a lot of questions raised about why he was initially turned away from the hospital. It wasnt until sunday he was admitted and treated for ebola. Cdc said thats a teachable moment for the United States. We spoke this morning with a doctor of Emery University treating a few of the u. S. Ebola patients saying hospitals have catching up to do in terms of emergency preparedness. A lot of medical centers around the world are just in the planning stage, and so, we are likely to see additional patients slip through the cracks while people are implementing their protocols. Reporter now, its important to note that none of mr. Duncans contacts showed symptoms. Its been ten days since he was admitted to the hospital and questions of how to prevent spread in the United States. The cdc director said only way to limit the outbreak is stop the outbreak in west africa. Theres enhanced screenings coming in from west africa. Those airports are new yorks jfk handling the most travelers coming in from those countries, washingtondulles, new york, chicagoohare and atlanta international. Back the you. Thank you. Meg, do you know how that affects passengers generally . Will they see so what kind of screening . Have they said yet will take place at these airports . Reporter they have some guidelines. Looking at passports. If they have come in from those three countries in west africa, which are guinea, sierra leone and liberia, theyll be taken to a screening place, temperatures taken, questioned. Showing signs and similar tolls they will go through further procedures. Shouldnt affect people. Not yet. Meg, thank you. Thanks. Also this week, we have been highlighting the top leaders and inmany va or thes on the cnbc next list, a list of people to change the face of business over the next 25 years. Joining us is our own Andrew Ross Sorkin with the cofounder and ceo of vice media, shane smith, part of the next list. Andrew . Thank you, bill, for that introduction. Shane is here. We were talking about ebola because theyve done great work. We have a few theories. You have quarantined your team. It is not a not something you mess around with. Were careful. Working with the cdc an theyre under quarantine now. Its a tragedy. Talking business if we could segue there at all. Youre on their list, our next list. Sure. Congratulations. Thank you very much. Congratulations even more importantly, you raised some money, 500 million bucks. Yeah. Valuing the company at 2. 5 billion. Premoney. Premoney. Sure. Explain to what vice is supposed to look like in five or ten years to make that valuation make sense. Well, i think, you know, our concentration is going to be on mobile. Which is where the majority of growth is coming from in audience so weve made a lot of investments. We bought care creative, 50 of the best engineers on the east coast and mobile is a focus and looking at tv and online and three screens, one screen, ott. We want to be everywhere. Is it possible to truly scale this business . You have a you have a brand and you have a Great Program on hbo, for example, a lot of people watch. You do all sorts of stuff online. Is there enough, can you create enough Quality Programming to feed the beast if you will. Yes of networks not not just the u. S. Network but potentially networks around the world and what you are trying to do internationally. Yeah. Thats what we realized. Selling tv bits and bobs and selling in 28 countries and we realize generating so much content. 35 offices around the world. 1,800 staff and theyre cranking out this great stuff, same stuff online, on hbo. We won the emmy. When everyone throws around preemup content, thats the Gold Standard of tv and we believe we can do that. The next generation that watches your stuff online, will they watch it on tv . Tv proper. Hbo is progressive so they have hbo go, investing in tech for the ott business, as well. So we have were one of the new shows on hbo that has its good ratings on tv but crazy ratings on demand and ott and all that stuff. Bill back at hq has a question. Go. Shane, how are you doing . Im curious. Good. How are you . You guys in Digital Media have free rein on content and no government regulations. Are we past the point of no return for governments to have a say on what is or is not were at the time now the fcc more concerned about the nickname of the Washington Football Team than anything else, so could you ever see governments try to rein in you guys in Digital Media or free rein down the road . Well, i would hope that we have free rein but, you know, if you look at it, the fcc exists because of television. Television pays for the fcc and i think that going forward, as online usurps television more and more, no offense, the fcc to stay alive, to keep, you know, the lights on has to start regulating in some Fashion Online because otherwise, you know, it is a dwindling stream of money for them for their existence. I think that its sad that that will happen because i think tv is overly regulated and if you look at online, it has been a lot more democratic and a lot more free. Shane, you had a comment earlier this year about cnn saying its a disaster, spiraling into a word i cant use on our network. I swear like a sailor on shore leave. What do you think about the next political election and how tv networks, Traditional Tv Networks cover them and the next generation that you have historically appealed to. How would you cover that differently . I think that news in america for whatever reason, theres a lot of reasons, has sort of splintered into talk radio on the right and sort of comedians pointing at the talk radio guys on the left. Its become so politicized that the big white space is go to liberia and press record. You know . So we look at providing just, you know, straightup heres whats happening. We dont follow the news cycle. We have stories from around the world. You think it rates better than what is on tv today . Id like to say im sure it will but yes. Im sure it will. For my demographic, i mean, fox and, you know, those guys, they have the 68yearolds and they can have them and we take geny and see who wins in the end. You have a new show, what . We cant use the word. Its a food show, guys. Its f thats delicious. I watched it last night. You know the f part. Yes. Its delicious. And the fcc would not approve. Correct. Correct. Great stuff. Andrew, thank you. Shane, good to see you. Thank you. Shane smith, ceo of vice putting us all on notice. The dow up almost entirely offsetting the sharp declines of yesterday. The s p right now above yesterdays closing highs so if we were to close at that level, that would be whats called a key reversal and a bullish move there. Jcpenney shares getting crushed today. A guest is salivating at the chance to buy that dip. Hell explain why he says the stock is too cheap to pass up and we want the know whether you think jcpenney is really on the mend and due for a turnaround. Your chance to vote at cnbc. Com vote straight ahead. Later, the man who used to run the cia and pentagon laying out his take on isis right now and how the u. S. Is containingll be. Leon panetta here. Stay with us. When change is in the air you see things in a whole new way. Its in this spirit that ing u. S. Is becoming a new kind of company. One that helps you think differently about whats ahead, and whats possible when you get things organized. Ing u. S. Is now voya. Changing the way you think of retirement. This is kathleen. Setting up the perfect wedding day begins with arthritis pain and two pills. Afternoon arrives and feeling good, but her knee pain returns. Thats two more pills. The evenings event brings laughter, joy, and more pain. When jamie says. Whats that like six pills today . Yeah. I can take 2 aleve for all day relief. Really, and. And thats it. This is kathleen. For my arthritis pain, i now choose aleve. Get all day arthritis pain relief with an easyopen cap. Jcpenney holding the First Investor day in three years. How are investors responding to the strategy . Courtney reagan has the details. Hi, courtney. Hi there, kelly and bill. For the most part it was somewhat of a victory lap here in a Company Sponsored analyst day in more than three years going through how far they have come since things were really so serious about three years ago but the stock has fallen fairly precipitously today and mainly on the comments of what happened in september or this Current Quarter three where they are lowering their comp guidance to low Single Digits from mid Single Digits, things didnt go as robustly as they hoped and still did reiterate the previous full years guidance and they laid out those longterm financial projections for the first time in a long time saying by the year 2017 they should have 14. 5 billion in the top line revenues coming in. We spoke to mike allman afterwards and said a number of things about the Succession Plan and said its not appropriate to speak about a board matter but thrilled to stay as long as necessary and also what he told me later is what he told the board initially that they never really was a set time line for how long he was going to be needed at the helm of jcpenney. Coming to store closure, i asked if they were planning a massive store closure. He said it is not the fastest path to Freedom People think it is. We evaluate it at all times and nothing new to announce coming to store closure. As far as back to school goes, he said they did make their plan, they could have done more. They always would like to do more and there were a number of veiled references in the presentations both from mr. Ullman and the executives of what ron johnson did that didnt work and the cmo started the presentation with a fine line between love and hate because so much had been said about how johnson had treated his current consumers. Kelly and bill, back to you. All right. Koutny, thank you very much. So we what we want to talk about is whether jcpenney can turn things around. Should investors bet on that right now . While were talking about it here, wed like you to go our website. You can multitask, right . Go to cnbc. Com vote and tell us if you think jcpenney is able to turn things around and seeing the vote as its happening talking about it right now. Lets get the arguments of max snyder and mark haight. Im sorry. I hate to interrupt, kelly. Mark, you look especially well dressed today. Thats a nice outfit youre wearing. Yeah. I have a jacket from stafford. Thats a jcpenney brand. I have to go to a wedding on friday and a shirt and a belt. I had to go i had to buy all this stuff. I dont buy clothes and cost less than 200 bucks so its a pretty good deal. From jcpenney. Look at that. Yeah. I love their stuff. You know . Id buy a lot of stuff there. I bought furniture there, too. Mark, you like the shares, too. You know since the last time you were on laying out the bullish case they have been negative. They have come down another couple bucks. Yeah. Look. This stock is completely unhinged from its real and true value. Completely unhinged. All right . The only reason why the stock fell today is because maybe theyll miss 20 or 50 million worth of sales for one month but theyre already reiterated to cover what their expected Free Cash Flow is for the quarter. I have three points to make here. This is a huge operating leverage story. A slight increase in sales over time and theyre expecting a large increase in sales over the next three years. Okay. Leads to a big profit. Right. Rick, you are not so convinced . Well, i think marks right. But i think the i think theyre hoping for a big increase in sales and i think its very difficult out there and im not sure if they just because of competition or the brand is tarnished or what . You know, where do you think they are in that whole process . I think theyre getting the customer back. I think the brand is somewhat revitalized. I just think its very difficult out there. Theres competition and the plan this they laid out was about a 5. 5 compound annual comp to 2017. And theres not a retailer, not a Department Store out there putting out those kind of comps. You have a hold on the shares. Yes. Mark, where do you think shares deserve to be valued here . Completely missing the whole point and that is theyre gaining their old customers back. All right . Thats mainly what theyre doing. All right . And people are coming in and buying stuff and new customers like me. I never used to go to jcpenney but theyre gaining new customers and their old customers. All right . So thats fine. Now what price are you expecting it to hit at some point . Whens fair value for jcpenney . Lets just talk basics here. The book value of the stock is 8. 50. Why is it selling below book average . The average of the market is 2. 5 times that. Its priced as if it is or should go out of business. They have already taken care of their debt issues. It should be worth at least 1. 4 or 1. 5 times book value. At least a 12 to 13 stock because its an inherent value right now and completely unhinged. And then if you discount from the future its probably worth close to 15, 16 from 2017. All right. And then lastly i want to make more point. Very quickly then. Its a takeover story. Do you agree . Hang on, mark. No, i dont think theres anybody out there to take over jcpenney and do a better deal. I dont think its a takeover. Who would take over jcpenney, mark . Quickly. Im out of time. Private equity funds, foreign buyers, anybody in the Retail Sector that wants to consolidate and maybe a management buyout at some point if theyre sick and tired of what the markets doing to this stock. Stranger things have happened in this sector. All right. Thats for sure. By the way, the poll closed, 61 of people said it will turn around. Not scientific. Gives you a sense. Rick, would you rule out four possiblies in terms of jcpenney . You can never rule anything out. But i think theyre highly unlikely. Thank you. Thank you as always. Not wearing a jcpenney outfit, are you, rick . No. Enjoy the wedding, mark. Handsome man there. There will be no filibuster on that, obviously, at that rate. Dow up 250. About the high of the day there. And again, so thats a 1. 5 gain. The s p, we could get a key reversal day taking out the low on the open this morning. If we closed here, take out yesterdays high. That would be a bullish i could k indicator. Whos winning . 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Yesterday around this time down by a similar amount. Green arrows across the board. Gains of 2 for the nasdaq. Stocks today notwithstanding jeff cox says the shorts may have been winning this market battle. Jeff, even with todays green arrows you are saying that . Yes, bill, well, you know, you have to be careful of deriving too much. You dont want to short the short sellers. This might be the best message here. After a year of the most shorted stocks best performers, thats changed recently. Now instead the most shorted stocks have been worthy of this title and measured by an Investment Group from a positive performer to 9 loss since september 18th and meantime the least shorted stocks, up more than 3 for the year. Why . Its all about risk. Now, investors feel confident, theyll look for high, Short Interest names as a contrarian play and conversely in risk off times they trend towards some of the safer names. So in this spate of volatility we see the vix up so much and unless it comes out of the market and expect those short companies to live up to their names. Back the you guys. Jeff, thank you. Stay right there. Well bring in john and brad. Welcome to you both. Brad, you agree with what jeff is talking about . Yes, somewhat. I definitely think that, you know, we had a really good pop in the market. Today were up. Yesterday we were down. I think the main object that we should be looking at is the amount of deterioration thats occurring within inside of a lot of key stocks. You like the volatility rising. Its tough to short a market thats just kind of gradually moving higher. It wasnt going much anywhere. It does. Now the volatility of the swings right now. Its great. Cover some stuff when its down and one thing that a rising market does do and not as strong as the last couple of years and when youre starting the move higher, the relative strength of names were shorting give us a lot of direction if theyre starting to get weak underneath the surface. We were short cons and sea world and certainly exhibiting weak patterns individually. Do you think the bears are an endangered species generally speaking . Yeah. You have to fight the fed, the ecb and bank of japan and problematic in and of itself. Last night japan yields down 50 basis points. Portugal, yeah. Obviously, thats hard to fight. Especially the fact that the fed came out again in the minutes and said well be lower for longer as a 5year forward continues to fall, yeah, we cant hike rates and looking at the december 2015 fed funds, theyre 60 basis points so you have a fed fund hurdle to beat and you have a raging bull market so in order to short that, i think its very difficult and problematic. Specific stocks are a different story but i think otherwise jeff . Thats an important point to make about the specific stocks. You dont need to be interested in the shorts in the portfolio short the market. Remember that i really think eni think you are seeing this between yesterday and todays behavior a market thats going to have a lot of these big swings. Those swings open up good opportunities for people looking to hedge and one way to hedge is, of course, shorting and, you know, we watched that vix on a relative basis. Gone up so much over the year and correlation important story here and not all risk off, risk on kind of days and opportunities to pick individual stocks and look for chances of, you know, where you can short. Quickly, brad . Totally agree with that. Yeah. Absolutely. Super moon, kelly. Thats why the vix is higher and thats why its down to 15. Everybody get up this morning to see the blood moon . Not supposed to look at it. A bad omen. Now you tell me. I hope youre not short, as well. Im short next to her. Thats all i know. Thank you, everybody. About 17 minutes left in the trading session. We are back, above now where we were yesterday. After yesterdays big selloff. Now the dow is up 281 points. Were above yesterdays high and were the same thing for the s p. A set of minutes from a meeting a couple of weeks ago basically telling us what we knew was happening an the market reacts like that. Its working big time right now. Also ahead, alcoa set for the kickoff to earnings season. 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If you have any sudden decrease or loss in hearing or vision, or any symptoms of an allergic reaction, stop taking cialis and get medical help right away. Ask your doctor about cialis for daily use and a free 30tablet trial. 13 minutes left. Wow. The dow up 269. Thats off the high, actually. It was up 280 a moment ago. Art cashin walked by and signaled to us theres 800 million of stock to buy. We saw yesterday with the impact of about half a billion dollars to sell on the close is things took a turn for the worse. Yep. So well see. They could pair off. But it sort of looks like a strong close here going in. Pretty much entirely offsetting yesterday. Bob pisani, whenats going on . The fed has a new mandate. People are saying, i thought the Federal Reserve is concerned with inflation and stability in the u. S. Economy. About job growth. We thought that was the mandate. Suddenly now in the minutes popping up theyre concerned about the global slowdown, the Global Economy. Suddenly the fed appears to have a new mandate. Im exaggerating a little bit but look at the s p 500. The markets looking like the fed is the protector of a global slowdown in some way and i think its worthy of a lot of discussion. It was a bit of a surprise to see them expand the areas of concern and why the market is up. Take a look at the sectors. Right across the board, really. Straight ahead rally here. 3 Percentage Points rallies and bio tech is up. Theres your emerging markets. China is up. Gold is up fractionally, as well. In terms of sectors on the s p, right across the board. Health care strong. Tech strong. Financial stocks are up. Industrial stocks are up. Everythings up 1. 3 to 2. 5 . That broad rally there in the broad, biggest sectors of the s p 500. Still even Energy Stocks rallied today and mentioning 52week lows in some of the big names, the drillers. Theyve even turned around. This is 52week lows. Theres transocean in positive territory. Quite a move here. We were saying oil pushed Energy Stocks lower and the Energy Stocks are higher. Exxon and chevron. In just a word, i mean, is this a good kind of rally or are we back to the bad old rally taking the fed coming out there with the dovish tone just to get us make up for what was going to be lost ground . It was a brilliant series of comments by the fed. Theyre concerned inflation is really low. Theyre concerned about the Global Economy was the real shock to me. I dont understand that. But they certainly said everything to make the market go up. Has an impact on the u. S. They cant not take it into consideration. Of course they have to take it into consideration, yeah. But it was the global comment that moved things. A big move it is. Thank you very much here. 287 points higher now after yesterdays 272point selloff with 10 minutes to go. Theyre buying, thats for sure. Coming up here, former defense secretary and cia director leon panetta making headlines with his take on the president s foreign policy. Thats next hour. Alcoa earnings on tap. Well be right back. Ameriprise asked people a simple question in retirement, will you have enough money to live life on your terms . I sure hope so. With healthcare costs, who knows. Umm. Everyone has retirement questions. So ameriprise created the exclusive confident retirement approach. Now you and your ameripise advisor. Can get the real answers you need. Start building your confident retirement today. Big day . Ah, the usual. Moved some new cars. Hauled a bunch of steel. Kept the supermarket shelves stocked. Made sure everyone got their latest gadgets. Whats up for the next shift . Ah, nothing much. Just keeping the lights on. laugh nice. Doing the big things that move an economy. See you tomorrow, mac. See you tomorrow, sam. Just another day at norfolk southern. Rally day with a few minutes left. The dow up 272 points. Boy, its look at the nasdaq. Thats the strength right there. So true. 1. 9 right now. Morgan brennan keeping an eye on some of the biggest movers for us today. Well begin with apple moving higher. Carl icahn tweeting hell send an open letter to apple ceo tim cook tomorrow and he believes it will be very quote interesting and carl, his son and David Schechter will be on cnbc. Different story for sears. Lower on a bloomberg report that a vendor holding shipments due to insurers reducing coverage and sears said it had the Financial Flexibility to meet its obligations. And amgen higher on the copycat of a blockbuster drug humira succeeded. Back to you. Morgan, thank you very much. Were coming back. That is wild close for the closing koubd. And then right after the bell, alcoa is moments away from resulting. And chairman and ceo Klaus Kleinfeld will be here exclus e exclusively to break down the numbers. Mystery. Youre never quite sure what is coming your way. 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That is twoday chart of the s p here and that would be a bullish move for some technicians meaning what they call a key reversal move there. Throwing it out there, letting you know the phenomenon happened today and alcoa to report tonight. Its part of the rally today. Earnings of 23 cents expected on revenue of 5. 8, 5 billion dollars. Paul shotz is here with us. What do you think . Bullish move . Following the fed . Its certainly a bullish move. A nice broad based rally. I wish the internals were stronger but a pretty good rally. Finished negative seasonal period. October normally reverses september. Were in this murky period and the market is groping for a bottom. I think it puts it in now. Retested. 5 move is all we can expect here . In a bull market, the bulls step up. Down 5 and then down 10 . The bull market is still intact. I think from here from year end, 5 or 10 higher. The market is loving the feds new mandate and concerned about the Global Economy. It was a surprise and traders going, jokes down here. Four more years. We want more of that talk. Alcoa after the clez. The f150 truck, aluminum and alcoa supplies it. May have a great future for aluminum in cars. Thank you for joining us here. As we go out. Just off the highs and quibbling here, still a decent gain, incredible gain after yesterdays big selloff. Stay tuned. Much, much more to come. Alco ceo on the Earnings Report coming out and leon panetta with a lot to talk about with kelly evans coming up on the second hour of the closing bell. And welcome to the closing bell. What a reversal. Yesterday, the Dow Jones Industrial average down 270 points. Today making up almost that entire loss, 270 points higher. 1. 6 . The nasdaq up almost 2 . S p with one of the best days in a year. Lets talk about it quickly here with views of the panel. Dr. J, whats it say to you . Well, lower for longer. Thats pretty obvious. Hang on. Small caps, reacting to it. We already have breaking news hitting the tape with courtney reagan. Whens happening . Yeah. Thats right, kelly. Big news, gap ceo and chairman glen murphy is stepping down, retiring from both of those roles effective february 1st. The president of growth, innovation and technical is taking over as that position of gap ceo effective february 1st. The new chairman of the board will be bob fisher. He founded the company with his parents, has been involved for some 35 years. Now, i just spoke to both glenn murphy and art peck. And glenn murphy tells me i informed the board that i couldnt make another longterm commitment to the company. Im proud of the teams accomplishment but i cant be here long enough to architect more strategies and see them through. Mr. Peck says that there wont be any big changes in strategy. He and murphy have worked very close together in the seven years that murphy has been there. Art peck has been at the gap since 2005 and he has been the leader in the digital space, a key growth area for the gap and lots of Movement Today and again just to reiterate the headline, glenn murphy is retiring effective february 1st. Same store sales flat for the month of september. Back to you. All right. Kout courtney, thank you. Is it just that time of year or a real weak Consumer Retail traditional retail spend story going on here . Im sure more details are forthcoming and at the same time the lang wang, the description of why he left, i dont want to speculate. Sounds like theres something going on on the personal side that prevented him from staying. It is a difficult period for retail and Holiday Season always crucial is probably more so this year so it wouldnt be surprising to change directions. I feel like every time i come on here somebody else is retiring or leaving the company. I feel like if you want to be a ceo nows the time to raise your hand because pretty much everybody is just leaving. Its interesting. Coming out of the piper jaf ri Retail Survey yesterday seeing that the millennials didnt see gap as interesting of a brand as perhaps they did in previous years, some of the other brands on the upswing and paints a picture of even though gap has done very well recently there are challenges ahead and so i think just that wording that she was mentioning is important. Dr. J, gap shares after market dropped 7 . How do you trade it . Well, you know, when you get a surprise like this, because this was not telegraphed, id deal ideally, they like to telegraph this that the chairman is thinking about pursuing other interests. But when it happens like that, thats a slap in the face and tells you theres either a massive disagreement on the board to your point or theres personal issues. Personal issues wouldnt be as bad as a bigtime fight in the boardroom. Exactly. Something going on behind the scenes. I was wondering, i dont know if courtney is with us but curious if it was telegraphed in other ways or chatter behind the scenes. Lets get back to that. Alcoa earnings hitting the tape and Morgan Brennan has the numbers for us. I do. We have a beat across the board for alcoa. 31 cents, earnings per share. Ex items. Revenues of 6. 42 billion versus 5. 85 billion that the street was expecting. That was revenue numbers represent a 7 increase over the earlier quarter and an 8 increase year over year but i want to pull out actually the upstream businesses for alcoa. Aluminum. Real, again, a highlight and a surprise beat there. Much like we saw in the last quarter and i know you will have the ceo on in a few moments but just a quick quote from him right now. This quarter is a clear data point that the transformation is delivering. We talked about that last week when we were at their new facility. Primary metals performed at levels not seen since before the downturn. We are seeing that stock up nearnear ly 1 in the after hours trade. Thank you. Well be speaking with kleinfeld in a couple of minutes. Lets bring in jim cramer for his take on the huge market moves. This gap news. Alcoa earnings. Jim, you start with whatever jumps out to you most here. I was surprised to hear that a Federal Reserve minute that comes out which says, listen, we are going to be data dependent, not going to lockstep raise rates was a shocker to the market. Given the thakt thats very consistent what they have been saying. The same time the market was looking for some good news. So it took it for good news and i think what we saw was a lot of short scramblinscrambling, longe sidelines saying maybe enough is enough. A lot of stocks reached good prices and a nice rally. I do not expect anything except earnings to determine whether the rally continues and alcoa would say theres some legs to this rally. Right. Im just curious talking about trading ranges. A lot of guys as you know pitting on the trade positioning for higher rates thinking that was kind of a scenario here to think about into next year. Now thats not the case. Look at the Consumer Staples today. One of the best days in seven months. Basically anything with a yield looks all the more attractive here, does it snot do you think people will kind of unwind some of those higher rate plays, the financials and pivot back towards a stuff that just looks like a healthy payout right now in this environment . I think we have to be careful. Theres a funnel. The funnels going to the consumer package good and Utility Companies with high yields. If you have a high yield and connected at all with an industrial, connected with auto, oil, it is being discounted. People dont trust it. I think tomorrow well see a resumption of the money away from those faux bond market equivalents meaning theres principle risk and continue to the absurd levels of the cocacolas and chloroxes and very little growth and true bonds. Theyre actual bonds. They have very little growth and do pay and thats what the market wants. That is risk aversion an amazing. It is amazing, jim. You mentioned chlorox and like your take on the gap news. The ceo out. Shares down 7 after hours and just the latest in a number of retailers seeing turnover up top or struggle of sales heading into the critical Holiday Season. I have to you never want to disagree with an aftermarket and obvious its for sale. Why did we love glenn murphy . Stock down 7 . He came from a drugstore business from canada. He did a couple of things that brought back a lot of stock, delivered completely inconsistent earnings, month to month was terrible. This up 6, this down 3. Thises a guy were unhappy he leaves . I dont know. I like consistent earnings. There you go. Theyre inconsistent. Im surprised that this stock is down as much as it is. I dont think he has that many friends and could be an incorrect reaction. Jim, thank you. Lets pivot to earnings season with alcoa releasing Third Quarter numbers and we want to now in klaus clean feld, chairman and ceo of alcoa. Welcome, first of all, and wow, this is a much healthier quarter than the market was even expecting here. 6. 24 billion in revenue. Thats about 300 million, 400 million more than expected at a time when theres so much and heard it from the Federal Reserve, imf, concern of global growth. Is there a discrepancy . What are you seeing in your business . Well, its a standout quarter. I mean, you basically just mentioned it. I mean, great performance on the profitability and great performance also on the growth side. And the good news is we have grown 8 year over year and half of it is organic growth in spite of the closings that we did. And if you look at the profitability, really comes from all businesses. Our downstream business is humming, record profits on an absolute basis. Record profitability. Look at the midstream year over year profitability up 45 . And also, positive one on the downstream side. I mean, the best performance since the market basically came down 2008. So, overall, im very happy. We have our jim cramer here. Jim, please go ahead. Sure, klaus, great to see you. Good to see you, jim. Something struck me in this class. I want to make a full circle. The demand for aluminum is up. The price for the actual raw good is up for the first time in a long time. It seems to be that it cant be all coincidence that you and your Great Company have created new uses of aluminum that have displaced other metals. Is it possible that the actual increase in the price of aluminum and the price of the raw is responding to the fact that there are new uses for the price of the process . Well, jim, i mean, youre absolutely right. There is much more demand for aluminum and we basically keep our aluminum demand growth projection for this year for 7 worldwide and see it every week. Last week, i mean, we opened up on aluminum lithium facility here in lafayette. In vienna, brand new facility and aluminum lithium. We won record sales. I mean, coming in two large contracts, each one over a billion dollars. One coming from pratt and whitney for engine materials and boeing. 1 billion plus. Aluminum is there to stay and aerospace and growing in places like automotive and others and good news supported also by the growth in our end markets. I mean, we are seeing that particularly in the u. S. Where were very strong. I mean, the Aerospace Market is strong. We see automotive growing and were upping our projections. We also see a very strong growth in the commercial truck and trailer market an we see the building and Construction Market comes back and also i mean we saw for the first time for a long time some tail winds coming through the lme and as you know, jim, better than anybody, we dont bet on the external forces but take what we can control ourselves and also what we saw in the productivitproductivity. You see productivity of more than 800 million year to date and its not over. I expect the Fourth Quarter for productivity coming from all businesses, all businesses participating. Hows it possible when the world feels that europe is pushing us back down again, that europe is teetering on a recession that you can deliver these kind of numbers and be as optimistic as you are given the fact that we expect a lot of ceos to say given the tensions in europe were not going to be able to make the number that is you think we can . Well, i think that we are as i just described we are in quite a number of relative healthy or rebounding end markets, and our strength in the u. S. Certainly helps us. The u. S. Is growing, it is growing even more than most people have expected and the growth projects for next year is positive. Asia even though its might be slower is stable and europe isnt as bad as many people describe it. Right . So and on top of it thats the end markets. We have a material or a set of materials that is penetrating more and more entries. Aluminum is one of those but we have been growing into other lightweight metals and we are creating these two things, the lightweight materials innovation powerhouse and creating a globally competitive commodities business and go very well together adds you saw again reflected in the quarter numbers. Klaus, can you comment on the strength of the u. S. Dollar. It is a concern raised of companies and now prominently by the Federal Reserve . Yes. Well, for us its actually a positive. You see it reflected in the numbers, particularly positive with the upstream market because our commodities are sold in dollars so if the dollar appreciate, the price goes up. At the same time when you look at most of the production is, its in those places where the denomination has gone down and the price goes down and the price goes up and a good combination and helping us. Taking a look at share price of ford and other automakers and despite the healthiness in the u. S. Market we know about and as you said maybe not so bad overseas, their shares tanked lately. Youre working with them of vehicles with aluminum bodies and can you explain what you see going on in the auto space right now as the concerns swirl out there . Well, look. I mean, ford has early this year launched their made public that theyre changing over the best selling car in the u. S. For the last 35 years. The f15 into an all aluminum vehicle. Thats a big statement and i believe thats a statement thats very well thought through. The cars are coming into the showroom by the end of the year. You will see that finally the revenues are also ticking up and the profits with that, too, so thats good news for us. The second thing that you have seen is the debate and the whole automotive industry, more so here in the u. S. Because in other places this discussion has happened and people here are now beginning to understand the enormously fundamental advantages and starting with lightweighting you bring the emissions down and you get fuel efficiency and secondary positives come also that count a lot for the customer. I mean, basically meaning you can get the same traction, you can use a smaller motor if its lighter weight, a shorter stopping distance. The safety elements so theres a lot of positives and i think thats sinking into the understanding also of most of the major u. S. Players and already very well understood i think by the customers. And by investors here who looking at the quarter thinking this through sending shares higher after hours. Thanks to you. Jim cramer, our thanks to you. Catch more of klaus coming up tonight at 6 00 p. M. Eastern. Former treasury secretary geithners memory appears to be not what it used to be and testifying again for a second day today in the ag bailouts with a lot of i dont remembers. Fed chairman ben bernanke following tomorrow. More details on this important trial later. Still to come, Container Store trying to keep a lid on the investor unrest. Ceo kip tindell joining us exclusively coming up. Welcome back. Dont call it a comeback but stocks logged the best oneday gains of the year. The dow adding 274, a complete reversal from what we saw yesterday. And this held across the board strong gains. S p 500, there it is. Up 33 points. Nasdaq up almost 2 points. Same for the russell small caps. I think dr. J called it a face ripper. It was. Pretty strong and encouraging. Key numbers, not 200 day around 1904 and did get down there and to whatever 1925ish area. Thats where a lot of people jumped in and the minutes couldnt have come out a better time if youre long or worst if youre short. Hi, morgan. Hey, shares of ruby tuesday soaring in the afterhours. Theyre posting better than expected First Quarter earnings of 4 cents a share. The street looking for a 12cent loss. Same store sales better than expected up 1 and sending shares of ruby tuesday almost 18 higher in the afterhours. Back to you. All right. We should mention trading at 7 bucks an ena surprise and the shares are responding well. Third day of testimony today in the aig trial. Former treasury secretary tim geithner taking the stand a second day. Ben bernanke following him soon. Mary thompson with a front row seat at the courthouse. Mary, seems to be the phrase of yesterday repeated again yesterday. I dont remember, i dont recall. Reporter that was mostly yesterday, kelly. This is the third week of the second or the third day of the second week of this trial. And today what we have seen from the former treasury secretary is facing three hours of direct questioning earlier this morning from the plaintiffs attorney followed by what is now the third hour of direct questioning or cross i should say from the governments attorney. He was defending the governments actions saying we set the powerful path for leaders in the actions that the government took during the financial bailout. Now, during the morning, plaintiffs attorney david boise questioned geithner of the government powers and the terms on the aig bailout and whether it forced losses on the shareholders. Geithner said we forced losses on hair shareholders that were proportional to the mistakes of the firm and he was pressed on a mildly Testy Exchange of the two if Bank Shareholders face similar losses after government assistance. Now, the subject of these high Interest Rates on aig loans also coming up, as well, during the days testimony. One memo describing them as crazily high. Geithner said he set the rate and now the cross now to discourage other firms of seeking similar assistance or preventing moral hazard and geithner said that private firms couldnt offer assistance because the insurers mix of risk too great, the needs too high and the woods were burning all around them. As you mentioned we are expecting Federal Reserve chairman ben bernanke and as it stands right now probably finishing the cross at 5 00 today and the redirect in the morning and that raises questions of whether mr. Bernanke can testify in the morning. We might see his testimony moved off to friday or another later day an ill have an update when we know. Back to you. Mary, thank you. Well have more coverage on aig tomorrow. The Container Store may be feeling boxed in. Up next, the ceo of the Company Joining us to pack up the companys woes and still ahead leon panetta joining me for a one on one interrue to talk about his new memory. [ male announcer ] ours was the first modern airliner, revolutionary by every standard. And that became our passion. To always build something better, airplanes that fly cleaner and farther on less fuel. That redefine comfort and connect the world like never before. After all, you cant turn dreams into airplanes unless your passion for innovation is nonstop. Its in this spirit that ingu u. S. Is becoming a new kind of company. Unless your passion for innovation is nonstop. One that helps you think differently about whats ahead, and whats possible when you get things organized. Ing u. S. Is now voya. 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Shares falling to new lows last year beaten down this week after 2015 guidance that was a bit lower than expectations. Here to discuss that as well as his new book uncontainible. Chairman and ceo kip tindell in a cnbc exclusive. Welcome. Hi, kelly. You rang the closing bell. What was that experience like . Great. Almost a year ago and did the ipo, too, and pretty special up there to do that. Were you shocked by the reaction yesterday in terms of double digit share price decline here . Well, yes. I mean, we Comp Store Sales down. 4 and so that was a little surprising. Yes, it was. But, you know, this doing the ipo, being public has been wonderful and terrible and good and bad and everything in between. Its sometimes a little surprising. I want to bring in the panel in a second. A question coming up reading about this and the way you intentionally try to be quirky and cultivate the Company People want to work at. The quirk might come naturally. Do you have a nolayoff policy . Yes. We fire people for not being excellent all the time but never just a systemic and the Great Recession we were able to you have to match revenue and thats the easiest way to do it. Having people Work Together and talking them through that, lowering everything from toilet paper to computer leasing equipment by the amount of the revenues down, we got the same thing and much more engaged and happy and secure employees. You know, im just curious from an anecdotal perspective, how does it feel Consumer Confidence is right now and people reenergized and doing business in the Holiday Season . Im the incoming chairman of a National Retail federation and supposed to comment on such thin things and know about them but the consumer can fool an old retailer. Weve been off 1 for a couple quarters in a row and that was noticed yesterday on our stock price but i think the consumers being a little bit cautious. After the Great Recession, we came become and had banner years, great increases and then with the still uneven recovery theres softness. I dont know that many retailers, theres a new but most are not thrilled with the Comp Store Sales right now and paying attention to really good gross margin, watching s ga and comp store sale number is a smidge weak. How do you feel about the Holiday Season . Thinking about this this year to last year. You have a longer Holiday Season. One day. Its important. You dont have the Government Shutdown hanging over your head. Thats big. Do you have a better feel about whens going to happen and feel like theres going to be a more competent consumer in the holidays . I do. You have weather and the two big weekend that we had in the constricted calendar last year for retail so a lot of people didnt get their Holiday Shopping done. They just they gave up because of the weather and the short calendar. And thats terrible. They wont let that happen again. I have never seen that in my career people said i didnt get it all done. Who doesnt fail to get the shopping done . Half of america. I think for that reason retail will have a significantly better Holiday Season this year and the chances of having a once in 30 years weather thing are pretty low, too. As far as new stores, you mentioned that, as well. Thats one of the thing that wall wl and publicly traded stock now and focus on when you have sales not quite as robust and will you cut back on store ownings and so forth and growth. Are you . No. Were growing at 12 Square Footage growth and right now in retail is very, very, very fast, among the higher in the industry and new stores never done as well as theyre doing now. We are getting 23 four walls ebitda first year and a wonderful business opportunity. So the new stores catch the wind at their backs when they open with pentup demand in the area . Theyre doing great and more wanted by the best real estate Shopping Centers in the country. Before the Great Recession, like we have come of age. Everybody want it is container. We get the best locations at the best price. We are laser focused on the really the traffic down about a point and a half to where we thought it would be. These last couple of quarters in a row and we have three giant initiatives designed to fix that but they have to get implemented. Its going to take another two quarters or so for those to be implemented. Every week that goes by theyre implemented with an athome closet thing in your home and organize your closet. Doing a solid builtin closet we call it tsc closets and our pop Affinity Program and doing a frequency program. Loyalty prime minister. That doesnt give away needless margin but gives hugs and communication and thats already making a difference in traffic which is what its designed to do. Wall street is eager to see the fruits of those results. Kip, learning firsthand the roller coaster ride it can be as a publicly traded company and his book has much more about the self professed quirkiness of the man and the company. Thank you so much. Thank you. Really appreciate it. Got a minute . Thats all it takes to shore up a skill set for a new career boost. That story is next. And former defense secretary leon panetta making news this week with the comments of president obama. He may make more headlines just ahead. He is here on closing bell. Relief. A cure. Today, we believe every life deserves worldclass care. As one of the top four hospitals in the nation, over 100,000 people from around the world come to Cleveland Clinic for care each year. And were ready for you with a Second Opinion or a sameday appointment today today today and everyday. Call today, for an appointment today. You just have to win 70 of your points at net. And keep unforced errors under 10 . 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A way to better wages could be just 60 seconds awe and thats thanks to a new Startup Company that kate rogers is looking at looking to solve the skills gap. Labor Participation Rate at the lowest in more than three dekids and hourly wages stagnant despite a low unemployment rate. Some say the growing skills gap in the American Work force is to blame. Researcher of Mckenzie Global Institute suggests a shortage of 16 million and 18 million high skill workers by 2020. Naturally startups are lining up to cash in. But is grovo looking a technology and more than 3 Million People have taken it short videos at most 90 seconds long. You can see i took a test drive on it today completing the quiz, we wont talk about how i did on it and 4,500 lessons on everything from Cloud Computing and the startup itself raised 7 million in funding of big names including partners and udacity raising 35 million for its Nanodegree Program and while not everyone is on board with it, the trend seems to be of short and sweet coming to learning. Back do you you. If it helps close the skill and wage gap, kate, the more the better. Thank you. Thank you. A new book has the attention of the white house and the nation today. Leon panetta being called disloyal to the president by some. Well get his reaction to that and much more coming up next. And apple announcing a quote special event for october 16th. Cnbc. Com reporting its the unveiling of the new i pads. A popular story today. Later well see if it was popular enough to crack the hot list. Stay with us. Ok, if youre up there, i could use some help. Smart sarah. Seeking guidance. Just like with your investments. That sets you apart. It does . It does. Youre type e. And seeking another perspective is what type e s do. Oh, and your next handhold. Is there. You dont have to go it alone. E trade gives you the support and guidance to make informed decisions. Are you type e . Where the reward was that what if tnew car smelledit card and the freedom of the open road . A card that gave you that im 16 and just got my first car feeling. Presenting the buypower card from capital one. Redeem earnings toward part or even all of a new chevrolet, buick, gmc or cadillac with no limits. So every time you use it, youre not just shopping for goods. Youre shopping for something great. So i can reach ally bank 24 7, but there are24 7branches . Its just im a little reluctant to try new things. Whats wrong with trying new things . Feel that in your muscles . Yeah. I do. Try a new way to bank, where no branches equals great rates. Next guest held so many vitally important jobs in government its hard to pinpoint one. He was president obamas secretary of defense. Before that he was director of the cia. President clintons chief of staff and director of the office of management and budget and now he can add author. Hes written a new book worthy fights and joining me now is leon panetta. Mr. Secretary, welcome. Thank you for being here. Nice to be with you, kelly. You have generated plenty of headlines and press for the book. But your motive here really seems to be not so much about the sales but the two and a half years of president obamas term which you think could make or break his presidency. What do you think he needs to do right now to address the threat of terror in the mist and how urgent is the situation as you see it . On the issue of confronting isis and the threat of terrorism that were facing in that part of the world, i think the president is taking the right steps. We are going to war against isis. Weve deployed forces there to try to develop and train the Iraqi Security forces. Weve developed a very Strong Coalition that can work with us in that effort. Were doing air strikes. I think its very important for the president to make this a comprehensive effort against terrorism because i see this as part of a long continuum that goes back to 9 11 and that isis just represents another form of al qaeda that threatens this country and for that reason we have to address in a very comprehensive way terrorism in our time and i hope the president does that. Youve said comprehensive twice now. So do you mean going beyond air strikes, putting u. S. Boots on the ground . I think its important to understand that if were going to do air strikes and i think we should that in order to make air strikes work, you have got to have targets and know where the targets are so the key is having people on the ground who can define what those targets are. Now, in iraq, obviously, the Iraqi Security forces can play that role hopefully. We do have our forces there that can assist, as well. In syria, its a much more difficult situation. Because were dealing with a rebel force that we still have yet to train and arm and put in places so that we can make them effective in terms of being able to detect targets. So i do think that when it comes to syria, you know, we need to listen to our military, advise the president of whats necessary to make sure that the air attacks in syria are effective. Understood. Listen. You wrote this book not because youre happy with the strategy right now but, again, because you sense a you are sen ji and a change that needs to happen in a white house that you and many other former members of it have been critical of, very early on, very early on from leaving key posts in that white house. Theres clearly a pattern here and in which theres dissatisfaction to the point of hysteria of whats happening and do you regret the timing or the decision to km out with this book . Is there anything youd like to more clearly say to the American Public than indicated here . No. Look. This is about the next two years. I mean, this is not about the past. Whatever mistakes were made in the past this is about the future. And i think the concern i have is a bigger concern about the kind of gridlock were facing in washington. And when we talk about our National Security, perhaps one of the biggest threats to our National Security is the dysfunction in washington because we have a very divided washington. Its very partisan. Its in gridlock, stalemate. And the result is that were giving up on dealing with critical issues. Developing a budget deal that can help confront the deficit in these next few years, dealing with Immigration Reform and infrastructure funding and trade and the ability to expand trade. Dealing with energy. All of those issues are critical. Not only to our National Security but the economy. So the rare challenge for the president and the congress is to come together and provide the leadership necessary to deal with those issues. That said, the gist of your comments, your sense that this white house has contributed to the u. S. Appearing weak on the global stage, president obama backing down from the red lines he outlined in syria, you have prompted the response of former obama spokesman and bill burton and said in the twilight of your career, dishonorable, sad, small and petty. Well, you know, ive presented an honest description of my life, really. This is not just this isnt about president obama. Its about leon panetta and the challenges that i faced and the worthy fights that i engaged in during my career. And i think ive been very fair and honest about the approach. I mean, look. The reality is in the four years i served president obama he strongly supported our operations at cia. Supported the bin laden raid. Supported the efforts that i did at the defense department. And today, i think with the actions hes taken against isis i think he is on the right track to try to reassert that leadership. I really believe that all of us, all of us need to Work Together to try to see if we can put this country on a better track towards the future in order to make sure that our children, children like me, sons of immigrants and others, have a chance of living the american dream. And you have a terrific tale that you tell in this book about your father coming to the u. S. , the restaurant that he and your mother ran, the experience you had on the walnut farm and how important your faith has been to you in those key moments including the takeout of osama bin laden. I want to change tact slightly from that to a report of the u. S. Monitoring data breaches into jpmorgan this summer. We could be in for a cyber pearl harbor. Can you explain the depth of your concerns when you meanwhile have the director of the cia likening these chinese hackers, for example, to burglars stumbling around . Look. You know, were facing a very troubled world and facing a number of threats from isis to iran to north korea to challenges from russia and china and elsewhere. One of the challenges were facing is the threat of a cyber attack. We have confronted that in terms of denial of service attacks on industry. We have confronted it when they have, you know, in effect obtained intellectual property from Many Companies here. And they also have the potential to destroy. We saw iran attack the oil and take down and destroy Something Like in excess of 30,000 computers. They have the dcapability to tae down the grid system, power grid, government and Financial Systems and virtually cripple this country. We have got to be working together, both did government and the private sector, in order to effectively confront the threat of cyber attacks. I think this is this is the battlefield of the future. And one that i hope from your experience you can reassure us is well reinforced . I think i think we have among the best people in the world in terms of their capability and knowledge and experience with regards to this technology. I think we can confront this effectively. Just a couple of quick questions before you go. The first Warren Buffett here made it clear that he thinks Hillary Clinton is and should be the next president or its likely that she will be. Your assessment of her, i take, to be broadly positive. Is that a fair way to characterize and do you think shed be aleader of this country . I do. I have known her a long time. I found her to be somebody whens very dedicated to the future of this country. Has the experience, has the toughness necessary to be able to serve as president of the United States so i think she would be. Okay. Is ebola a Security Threat to the u. S. Here . Have you been concerned by the handling . I worry about the ebola threat just like im sure everyone does because we dont have a cure for ebola. And we live in a very interconnected world in which this kind of disease can spread rapidly. So, the challenge here is to contain it. I think steps are being taken, deploying troops there to try to do what we can to contain it in africa. But we are all going to have to learn an awful lot more and do a lot more to make sure that we are able to control what i think is not only a threat to the physical welfare of people, but a threat to our security, as well. And finally, mr. Secretary, have you heard from president obama since publishing the book . I have not but ive been running pretty fast and hard with doing these kind of interviews for the book. Yes, you have. We really appreciate your time and your candor here. We wish you luck with it and, again, thank you for being here. Leon panetta. Thank you. Up next, scouring cnbc. Com to see what stories you helped make the hot list today. Tomorrow, halloween is near. This is not about a trick or treat. Hershey is changin changing to talk about his sweet stock. Well be right back. You make a great team. Its been that way since the day you met. But your erectile dysfunction it 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. 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Its jeff coxs story about the shorts, highly shorted stocks getting hammered and so the shorts bet on them doing well. People have jumped into that. The market stuff and winning and losing, thats been a big pull for a couple of reasons. Carl icahns tweet of having an interesting open letter for tim cook at apple. That, of course putting up an apple story, people flood into it. Another one is humorous piece by the former high flying Hedge Fund Manager and looked at the wl wall stunts hes seen and sort of ties into the filthy rich show on the network at 10 00. Oh brother. And biggest funny one is he did in a sky box and throwing money out to the people down below. Just to see if they notice or not. Crazy stuff. Oh, allen, thank you. We have results of alcoa today. Tomorrow family and pepsi and what the panel is expecting from earnings season. Well be right back. I make a lot of purchases for my business. And i get a lot in return with ink plus from chase. Like 70,000 bonus points when i spent 5,000 in the first 3 months after i opened my account. And i earn 5 times the rewards on internet, phone services and at Office Supply stores. With ink plus i can choose how to redeem my points. Travel, gift cards even cash back. And my rewards points wont expire. So you can make owning a business even more rewarding. Ink from chase. So you can. Welcome back. A couple of minutes for final thoughts with the panel. I dont know where to begin. Kate . Wow. Well, im looking at commodities and coffee the best performing futures contract of majors up 98 and consumers have already you just the blood drained out of your face. Yeah. Doubling. It is, it is. Consumers are already seeing higher prices in stores and starbucks. I will confess i paid 2. 50 for coffee. I felt terrible. No one should. Was it good . Very good. That is good. It was very good. The issue is if i may for one more second these bean that is are the most flavorible, mild coffee that people like in this country are replaced which are grown in vietnam and not subject to the same seasonal issues of brazil and may be degrading the quality of the cup. All right. Im on high alert for this. I wont pay 2. 50 and degraded. Prices are sweeping the nations. This conversation back to the fed. I had an opportunity to host a panel where there was a senior economist from the fed on it in chicago, and a couple of interesting takeaways from him. Theyre far more concerned about deflation than inflation. And theyre far more concerned about being they would rather be ahead of the curve than behind the curve. Vice versa . They dont want early. They want to be late. In terms of the fed having an impact on the market, theyre as dovish as can be. That would be a charlie evans. Not that the president of the chicago fed persuades the entire yeah. It wasnt charlie. It was one of the Staff Members and takes some stuff from charlie and talking on a broader scale of the things theyre hearing trickling down. Coffee prices. I know. Well, yeah. That and leveraged loans. Sorry. Thats all right. Janet yellen has points of concern. Lets get serious here. Commodities have been one in general. Watch tesla. They have that event tomorrow. Elon musk talked about it. Probably dual drive trains for the cars and chips like sky works because they go into the ipads and so forth. How much of a tell is alcoa today . That was a pretty good beat. That was huge. The demand out of sector that is havent traditionally used it as much like rail cars and like ford trucks and so forth. But that makes me think its idiosyncratic. Its a great story and hopefully a constructive earnings season and same token as you said theyre taking customers of a base not tapped before. They have done a great job and in this particular case its evaluation issue. Right. A great spot with aluminum supply and some dynamics in the market here meant we have to hop. If klaus says things are better as much with the business improvement. He is thats the way i took it, well. Thanks. Fast money in a few moments on the major market day, melissa lee. We have a lot to trade here. Alcoa, gap crushed dean new ceo i spoke to earlier this year and venture capitalist extraordinaire to weigh in on the correction we have seen in bitcoin. All right. No delay. Straight over to you. Thank you. Fast money starts right now. From new york stock exchange, im melissa lee. Stocks having the best day of the year today. Well tell you how to make sense of the volatile market. Traders are pete, brian, karen and guy. Shares of the gap falling after hours on news that the ceo is leaving. Well look at the replacement art peck. We start with the fedfueled rally. The fed was concerned about global weakness and the strength of the u. S. Dollar. Even the transports taking a hit for the third day in a row. They reverse course on the heels