Transcripts For CNBC Closing Bell 20141009

About, right . Probably most concerned about german policy makers. In other words, not the ones at the central bank. Its mario draghi saying to the european governments, its up to you. You have to take the ball here. Meanwhile, in the u. S. The deficit is down below 3 of the gdp. Well go into the crucial final hour of trade. The dow down 319 points. At the low it was down about 345. The s p down 38 points today. Weve taken out obviously yesterdays lows. Now at 1930 and change. The nasdaq composite is down almost 1. 9 . Thats down 2 1 3 . 1071. Weve also been watching oil which today closed at a twoyear low. The price of wti crude here in for delivery around 85 a barrel. Now i see it at 84. In the electronic trading it continues lower. You know from the electronic trading figures, the futures, that we can follow oil is in a bear market. Down 20 from its highs just this summer. So talking about that. Keeping an eye on Interest Rates. Lets get to it now in our closing bell exchange. Joining us kevin koran, jim lowell, Heather Hughes from sun American Funds and our own rick santelli. So welcome one and all. Jim lowell, why the selloff here today . How would you describe, summarize this market . Whats going on . Well, first of all, i dont think its all that surprising that the markets are pulling back. I think its surprising its taken them this long to do so. Obviously comments from draghi about secular not cyclical issues. Attending the eurozone where we think and have been talking about it sliding into a mild and recoverable session. Looked a little bit closer than they did 24 hours ago. Ultimately we like what we see. The smaller cap indexes are in correction territory. Thats where youd expect the brunt of the selling to be. The megacaps are basically holding their own, giving up a little bit today. So long as this market sells on fundamentals, we think at the end of the day it will be a buying not selling opportunity. Peter anderson, warren buffet said on mondays big selloff he was in buying on that day. Are you buying on these selloff days as well right now . Well, as you know, i usually do. I have to tell you, this week has been kind of perplexing. I think its been one of the most challenging weeks for managers. Yes, glad you said it. Just in general. Lets just layoff some of these things. I dont know about everybody else, but i was really surprised about the minutes. I didnt expect that kind of direction that the minutes took. Then of course you get what surprised you the most about the minutes . They were dovish. They showed concern about the rising dollar, the slack in the allegra market but what surprised you . Well, you know, the fed is supposed to have whats called a dual mandate, right . Theyre supposed to be looking at unemployment and Interest Rates. In our office were now saying well maybe the fed has a quad mandate beside those two factors its also looking at the u. S. Dollar and the european conditions. So its kind of expanded in our opinion. Thats not true. Its all look, the dual mandate, all that comes down to the fed trying to gauge growth and react to it, you know, correspondingly, inflation, too. They would be crazy not to take the global considerations into effect and take the move of the u. S. Dollar into effect, peter. Point taken, but ill tell you this, that the first and foremost in my opinion is the u. S. Economy, and, you know, kelly, i think u. S. Economy is doing just fine. I expected them to say that the first half of next year there would certainly be, well, not this strong words but that they would still consistently hint that rates would be rising. They would raise rates in the first half. And that was absent. Then today you get some of the regional president s like the one out of st. Louis kind of backing backfilling that and saying maybe we do need to raise rates. But, peter its very confusing. Peter, i would say that yesterdays rally does still make the case in point that the market is correlated to stimulus or keeping rates longer lower for a longer period of time. Do you think that correlation still holds true as we continue . Its a correlation that is frustrating to me because i think that what we should have is a steady drum beat of increasing rates to reflect the fact that at least the u. S. Economy by almost all measures seems to be getting stronger, and i agree with you. The correlation does not make sense to me right now. If the economy is getting stronger, and i hope youre right, what is concerning to me is that oil may be a leading indicator of the economy. It tends to move before stocks, real estate, bond indication if the economy is getting stronger. The fact that oil is at twoyear lows right now is somewhat concerning also. I want to know why oil is not participating. Youre seeing the Energy Stocks take a hit today and to jim lowes point, the Consumer Staples are down also but relative to the rest of the market youre seeing that flight to quality, the safe haven and the megacap large value sector such as the Consumer Staples. Kevin coron, why dont you take that oil question and what it says. Yeah. Energy stocks certainly have suffered as a result, but it can be good for the economy obviously especially for the consumer here. Yeah, in fact i think that explains all of this, the twospeed Global Economy were dealing with. You have europe thats essentially growing at zero or not growing at all, germany contracted in the last quarter, you have japan trying to stoke growth, you have china growth is decelerating, meanwhile you have this island of improvement here in the United States. So what you have is weak Global Growth thats affecting the Commodity Markets including the oil price. Theres a lot of supply out there and then the dollar is explained, too, by that. Right. The fed needs to let the Dollar Strengthen somewhat to put some purchasing power in American Consumers pockets to buy from all of these other places around the world that are struggling. So this is a very interesting dance. Its somewhat different than what weve seen in the last few years. Im not at all surprised to see this causing confusion among investors. Then, again, getting different messages out of the fed like we did today from Stanley Fisher and jim bullard versus yesterdays minutes, this is all very confusing. By the way, just to interject. Stanley fisher, the new vice chair of the fed said today he put a time frame on the phrase considerable period of time. He said its anywhere from two months to one year. And you can imagine how much differently those comments could have moved markets against a different back drop here. The original clarification of six months created a big selloff over the summer before she walked that back. He now trying to expand it. Any time you put two months out there. Rick santelli, let me pick on a phrase kevin used. Island of improvement. Can the u. S. Remain this island of improvement if the Global Economy continues to weaken . Well, i think that investors can think that. I think theyre going to be in denial if they dont already know the answer. You know, super mario draghi has been demoted to a luigi plus. Im sorry. But when he made a Statement Today that we will do whatever it takes, im paraphrasing, the market is only interested in define we. I still say quantitative easing american style may not be something that mario draghi could pull off but it doesnt matter. And as to the minutes, my guests just nailed it. We all heard that meeting. What was the main center piece of the press conference in the minutes . Ill tell you what it was, about considerable period. I dont recall the Dollar Strength or the european weakness being a mainstay, but it was a mainstay in the headlines yesterday. I think the fact that the market whitewashed all of that shows that whats going on in europe, they have an export economy, we have a consumption economy so wheres the transmission . Think credits, think banks, think spanish, think italian yield. Think of their loan portfolios that glow in the dark and its a bit toxic and theres your transmission. Thats what we need to Pay Attention to. Keep watching the dax and the cac. It didnt hold the bounce. The dax is under 9,000. Watch how fast it takes to get to 75 bases points on that boom. I was going to ask you about that. For those who dont know, the ten year in germany hit an alltime low today. What was it, 89 . Or 83. 86. 86 but it popped back up a bit. So you think it goes to 75 and what does that do to our own ten year . How much lower . Were at 228 or 203 or something today. You know, i think u. S. Rates can continue to go down. I know leon cooperman was so smart today. He said historically rates need to look at 2 1 2 growth, add in the inflation. Thats where the ten year should be. Where would stocks be if we had a ten year 2 1 2 . I think well continue to spread against european rates, not one for one but if they go lower i certainly think well go lower. If equities go lower, i suspect u. S. Rates will go lower as well. Jim lowell, just a question as well. Rick, when i asked him if we could stay an island of improvement here, he said i think we already know the answer. Your answer seems to be yes in that youre behind the weakness because you say this has been a selloff of fear and not fundamentals. Why do you think the u. S. Economy can continue to hold up its momentum here . Well, well get a very good read not just in terms of rates of Earnings Growth but also guidance. That will be absolutely mission critical. Also, it is clear that the fed, like us, should be a little bit worried about a stronger dollar, strengthening dollar, its toll on the exports. We continue to look at the battleship ballot blue chip sheets. They have cash in the coiffeurs. This is a buying opportunity so long as the fundamentals hold for true longterm investors. For traders, this is a very different kind of marketplace where you really do have to trade amidst confusion. For longterm investors, this is the same scene that set the stage. Everybody stay right there. We have a treat for everybody. Youll love the closing bell exchange. Were going to extend it into the next segment because of whats going on. Were going to add one more person. Well add larry kudlow to the conversation coming up in a few minutes. All of that with 50 minutes to go. The dow near the low. Off 332 points on some pretty decent volume. The nasdaq is off almost 2 . Art cashman telling us 1925. 1929 is the level right now. Even a day like this cannot keep a good ipo down. Check out hub spot. It defied the downturn and it is trading 20 above its opening price today. Its an Online Marketing software company. The ceo will be joining us exclusively in just a few minutes. Also on the docket, a trio of heavy hitters. Hershey ceo and ragu rajan. Market reaction all ahead. Dont miss it. Opportunities arent always obvious. Sometimes they just drop in. Cme group can help you navigate risks and capture opportunities. We enable you to reach Global Markets and drive forward with broader possibilities. Cme group how the world advances. Dad,thank you mom for said this oftprotecting my future. You. Thank you for being my hero and my dad. Military families are uniquely thankful for many things, the legacy of usaa Auto Insurance could be one of them. If youre a current or former military member or their family, get an Auto Insurance quote and see why 92 of our members plan to stay for life. I was out for a bike ride. I didnt think id have a heart attack. But i did. Im mike, and im very much alive. Now my doctor recommends a bayer aspirin regimen to help prevent another heart attack. Be sure to talk to your doctor before you begin an aspirin regimen. If youre just joining us here, if you wanted to see if yesterdays rally continued, the answer briefly, no. For various reasons. Down 318 points. The leader to the down side, down 2. 3 . I havent seen what the transports are doing. Theyre down 200 points as well. So minus signs very much across the board for the stock market today. On the same day that oil is selling off significantly. One of the weakest links of this entire space and continuing our special coverage of this massive market selloff. Larry kudlow joining us along with our closing bell exchange. Good to see you, larry. Earlier this week you were telling everybody, stop losing your heads. What do you make of this action . Not pretty. This is a great time to add to your 401 ks and iras and whatever accounts you have. Terrific time. There is no recession. There is no inflation. Energy prices are coming down. King dollar is nice and hefty and strong. All of thats a good sign. You saw unemployment claims this morning, jobless claims, what were they, 287,000. Right. Businesses are investing. All im saying is the fundamentals, corrections come and go. Octobers a pretty tricky month, i get that. Just ride it out. Add to your retirement account. But, larry, is this selloff about our economy or is it about the european economy . Is mario draghi signaling that hes pointing to member nations that they have to do their part to solve the problems on the continent right now . Isnt that partly to a good degree why were selling off and why were seeing yields continue lower on the ten year . You know, bill griffeth, all the years ive known you, let me just say the answer to your question is i dont know. Okay . I have no idea. Look so noted. Mario draghi is going to do whatever it takes to keep europe solvent. If that means pumping in more money and buying bonds no matter what the germans say, draghi should probably increase the money supply. Europe has a lot of other issues. They tax too much. They spend too much. They entitle too much. We could go on forever. Europe hasnt grown in two decades. Lets be honest. The more interesting question to me, our biggest export partners, i want to make this point, our biggest export partners are canada and mexico. Dont forget that. And a half at that trade is 1 3 of our total trade. And you know what, canada and mexico are doing pretty darn good. So, again, i dont know whats cooking today. I cant figure it out. Im glad you brought up the jobless claims stay with it. Peter respond here. Please tell us as well whether you think this is the right opportunity for people who might have been on the sidelines for the last leg higher to get involved. Well, you know, larry itemizes a lot of positive things, right . And i have to agree with him. Lets just take some of that stuff in a vacuum. If i told you, say, two or three years ago that by now we would be almost at the verge of declaring ourselves energy independent, we would think thats fantastic, right . And so the fact that Energy Prices are decreasing for some reason today we think thats a bearish statement. But if you isolate that, that is a very, very bullish statement on a number of levels, right . Youve got a tax on society, for instance. So that will be a decreased tax level and you also have independence from the other countries in terms of generating energy. So i think its all very positive. For some reason the market has taken a very negative tone on all these items hes mentioned. Because of central banks. The fed doesnt want a strong dollar. They dont want the average guy to be able to buy more. They dont like when prices go down. They are a central bank. Who are they working for . Banks. Thats why. Look, rick san it does not help their inflation expectations, larry. I want to get back to other panelists, when you have king dollar, you dont have the inflation rate that the fed wants to achieve right now. Good. Good. The down side to that. No, thats terrific. Larry, you dont want them to keep stimulating. Theyll keep the cheap money policy in place until they get it. Thats the wrong answer. I dont think so. By the way, i dont like what the fed says. I agree with my pal rick santelli. The fed, they look at labor market indicators, they think too many people working causes inflation. Thats really stupid. But you know what, ill give yellen some credit here, how about this for a first . She is ending qe and they are going to gradually and slowly raise Interest Rates next year. And that is exactly what they should do. If i had one wish in the entire world for the american economy, i would say slash the Corporate Tax rate which will give the fed cover to snuggle up their shortterm rates and normalize. By the way, the republicans are going to take the senate and theyre going to put a Corporate Tax cut on the president s desk early next year. Larry, it is i completely agree. It is absolutely unpatriotic, not that we are undergoing tax inversion, but the unpatriotic stems from having the highest Corporate Tax rate in the world. Right. We used to be at least lower than japan and thats no longer the case. Hold that thought. Thats where i think we are being unpatriotic. Hold that thought. No, thats a great thought. I think i just heard a Nobel Prize Winning thought. There you are. Lets bring it back to the individual investor. Kevin caron, is this an opportunity to buy or an opportunity to take some money off the table and take some profits if you have them . I think its an opportunity to buy but i think you want to be looking for very high quality stocks because if you think about whats happened in the last two years, this market has roared ahead relentlessly. Its been led by lower quality, high beta stocks. You add selectively to Great Companies with fantastic balance sheets, consistent profitability, reasonable price, all that stuff is good. Keep in mind, the market is only down Something Like 4 from the peak. Most of the data is moving in the right direction. This is why were fundamentally bullish. Were tilted more towards equities. I would look at price and look very closely at quality of the holdings in the portfolio. More investment is coming. Thats a very positive thing for the future. Can i make just one quick stock market math real quick. At 120 a share youre at 16 times earnings, all right . Thats not ultra cheap but its not very expensive. At 16 times earnings your forward earnings yield is about 6 1 4 . Thats a very hefty premium over other Interest Rates and so forth. Thats why i cant get excited about this. Look, markets go up and down, dipsy doodle, dipsy doodle. It goes up, larry. We have a long ways to go. We have to go in a second. Jim lowell, isnt it fair to say that the reason we focus on the market on a day or a week like this, a lot of times when we, the people writing the articles cant figure out whats going on, the information from the market itself tells us something. This is the news, in other words. I guess so its less about sort of is this justified and more about trying to figure out why this is happening and what Predictive Power it may have. Fair enough. Its pretty clear that why todays selloff is happening is directly correlated to fears that the global slowdown is going to have a contagion effect on our own relatively slow economy. Bank of japan, while they may not ride to every rescue, theyre clearly capable of putting a pro found safety net under longterm equity investors. Thats why i dont worry about walking out on todays high wire although it was clearly wobbling a week ago. All right. Everybody, thank you so much for sticking around. We enjoyed the conversation. Larry, dairy say its always fun having you on being the straw stirring the drink as well, if i may use that metaphor, my friend. Okay. Any time. See ya later. Thanks. Weve got 35 minutes left in the trading session. The dows come back to some degree. I guess you can call it were only off a hundred points right now. You can call it progress. The level that art cashan identified, 1925 on the s p has held. Were at 1932. He will be joining us in a moment. Yes, he will. Were watching hubspot. Here at the new york stock exchan exchange, up 23 . The Online Marketing Software Firm ceo making the case for his company. How he plans to put 120 million raised from this ipo to work. Thats straight ahead. Also ahead, more information on the whiplash stock market. Well be joined by hersheys ceo and sprints former ceo and indias bank governor. Goal is to grow. Gotta get greater growth. I just talked to ups. They got expert advise, special discounts, new technologies. Like smart pick ups. Theyll only show up when you print a label and its automatic. We save time and money. Time . Money . Time and money. Awesome. Awesome awesome awesome awesome all awesome i love logistics. Welcome back. Not every day you see a decline of 300 points in the dow. We seemed to have a couple of those lately. I think this is the 12 triple digit move bill in 18 sessions, Something Like that. Volatility has picked up. The vix is up at a level of almost 19 and declines across the board especially in the small caps and energy. All the stats weve been keeping have been written down in pencil. We have to keep erasing them. Dominic chu is moving up the board today. The big loser today in all of that sea of red is gap stores. This is after the surprise announcement, the ceo is leaving the company. Theyre off by 12 on the day. Then theres a positive health story. Gentiva Health Services is bucking the news and Kindred Healthcare will buy it. Its 19. 5 per share. Theyre moving higher in todays sea of red. A tough day for Energy Stocks as Oil Prices Hit their lowest level since december of 2012. The majors, exxon mobil, chevron, also other names like anadarko, halliburton. Two Companies Making their wall street debut. Mol global plummeting at 12. 5 a share. Theyre down at 8. 30. A different story for hubspot. It soared as much as 31 after the marketing and Sales Company priced 5 million shares at 25 a share. The market volatility not just for established stocks but, kelly, bill, for the new issues. Great point, dom. Lets talk more about hubspots first day of trading. Joining us cnbc exclusive, brian halligan. I saw you looking over there. I was looking. Planning an ipo is like planning a wedding. It rained today but you still stayed dry, didnt you . Thats exactly right. It did rain. Were thrilled to be here. Thrilled to be here on the exchange. Why are you going public . What do you need the capital for . Were growing fast. Coming out with new products. Doing tuck m and a. We grew 48 last quarter. Business is growing good. We want to keep going. Are you immune to the Economic Conditions . Things seem to be slowing down right now no matter whether its here or overseas. Are you going to be affected by that . I think well be in good shape. The idea behind hubspot is your success is much more like the width of your brain than the width of your wallet. We help people use their brain and pulling customers in. I think it works either side up or down. Whats the need that youre solving out there and how has the grateful dead helped . We help customers grow. The grateful dead have been immensely helpful because theyre the ones that have decided were going to give all of our music away for free. People are going to share that music widely. When they like the music, theyre going to start coming to our concerts and buying the tickets. The grateful dead were very early on the idea of giving away content and using it as a magnet to fuel customers coming in. Written a book about this which is why i bring it up. Marking lessons from the grateful dead. Are you an ad agency or are you the company thats going to kill the ad agencies . Neither. Were software platform. Oftentimes agencies do their work on top of our platform. Theyll build a new website, blog and do the social on behalf of the customer through the software. We had the head of one of the large agencies here recently. We talked about whether or not its much easier for Small Companies who cant afford an expensive ad campaign to use technology thats available to do their own advertising. I suspect youre a part of that. It absolutely is. Its a great time to be a startup. Great time to be an attacker. The internet is sort of disproportionately helping the attacker and the person growing. The person on the way up relative to the defender because, like i said before, your success is more about the width of your brain than the width of your wallet. You dont need a lot of money to get attention online and pull customers in. The dynamics have changed. I just looked for you. Its still up 23 . Youre okay. Thank you. Brian halligan, cofounder of hubspot. Thank you for being here. Half an hour to go. Go ahead. 273 point selloff, thats not as bad as it was heading into the hour. Well see again lately on the close weve seen things accelerate one way or the other. Well check in with market veteran art fashion. Well see if he thinks were in for a rebound. Hes seen it all. We dont get nervous until he does. This is typically when we check in with him on the commercial break. Were going to do it on the air for you folks. Plus, find out how hersheys ceo is determining if this market is a speed bump . Plus what about the coco prices. 60 of the coco comes from west africa. Well talk about that coming up. Try a new way to bank, where no branches equals great rates. Watch this. Sam always gives you the good news in person, bad news in email. Good news fedex has flat rate shipping. Its called fedex one rate. And its affordable. Sounds great. [ cell phone typing ] [ typing continues ] [ whoosh ] [ cell phones buzz, chirp ] and we have to work the weekend. Great. More good news its friday woo [ male announcer ] ship a pak via Fedex Express saver® for as low as 7. 50. [ male announcer ] ship a pak via Fedex Express saver® today could be the day. The day we give you hope. 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. So ally bank really has no hidden fethats right. Accounts . Its just that im worried about you know hidden things. Ok, whys that . No hidden fees, from the bank where no branches equals great rates. Im supposed to tell you whats going on with the markets. Art, you talked about volume. It looks heavier than usual. A couple of things are going on. Were trying to bounce here. The early look on closers is neutral. If it stays that way, youll get a little room here. What happened was we came in this morning, another round of bad Economic Data out of germany. They sold off. They were trying to get their circle the wagons and along came mr. Draghi. He said he couldnt perform any further easing until they got fiscal reform and Everybody Knows theyre not going to get fiscal reform so that was an empty plate that he brought and we sold off pretty heavily. But were in a period of this volatility here. Have we completely forgotten about the fed minutes from yesterday . I mean, can we have it both ways here . Not forgotten but draghi the threat there is less about straight what it means to europe but a divergence between the central banks. They were all rowing in the same direction. If hes not going to be able to move his little skiff along, then it can present problems to the fed, maybe even to japan. So with that uncertainty it popped up. And then you have the background noise, which is negative. Ebola. Yes. There were stories around today about what happens if it comes to the western hemisphere. Fear that isis is going to take that kurdish town and then maybe move on baghdad. Thats not directly pushing things down but it is inhibiting some risk taking. Real quick you said 1925 level to watch on the s p. Looks like were holding on 1935. Why is that level so critical than any other . Well, we tested it. We did 1926 last thursday. We did 1925 in the more recent low so the real theory would be if it came down, hit 1925 and held, you might really get an appreciable rally from that. People would say, wow, a threetime test, that really looks good. We didnt get exactly to it. We got within hailing distance, 1927, i think. I would have liked them to get to 1925. Im check on market on closing. We look forward to that. Thank you, art. Appreciate it. Despite todays selloff, consumers are looking at our next guests company with halloween quickly approaching. We are talking about hershey. Ceobilbrey is joining us. Corporate responsibility is why youre here. We have to talk markets here. What do you think is going on with the markets, j. P. . Well, you know, i think that were pretty positive, actually, you know, about the things that are happening. We have a longterm view. You know, we go out. We try to execute hard every day. For our company, we offer accessible indulgences. So really products that are for the mass consumers. People may give up a lot of other things, but they still have the ability to afford a hershey bar, participate in a category. The category is done well. Coco prices we all know have gone higher. What many people may not know is where the coco comes from. And weve highlighted here that 60 of the worlds coco comes from west africa, not liberia, but ghana and the ivory coast. Are you concerned at all about the price going even higher or even just getting the coco out of that country out of that part of the world if god forbid the ebola continues more . Sure. One of the things that you may not know is, is that coco is a pretty structured market. We have the ability to buy forward quite a bit and, you know, weve had a very good rainfall, very good crops this year and a significant percentage of our 2015 needs, in fact, are already in our control. Theyre in the u. S. Or in the other places where well be processing that so from a supply chain standpoint, we would not expect any interruption. Obviously were following, you know, the ebola situation very closely, but we wouldnt anticipate any supply issues. The markets pulled back a little bit on those fundamentals down around 3,000. Right. Been higher than that. And just speaking of the supply chain, thats what youre in new york for, the commit to a responsible culture and supply chain forum. So how important is that issue to you . And i guess, j. P. , should people expect higher prices for their trick or treat candy this year . Well, you know, halloween is basically sold in. Weve had great response from retailers. Merchandising is good. Pricing is not going to change. In fact, on our seasonal events we sell well ahead so, you know, we shouldnt see any impact from pricing to the consumer really until next year. We did have a price increase this year, but the way that that works is is that the instant consumables tend to go up right away but the balance of the brands and merchandising is protected. The consumer wont see anything unique from a purchasing standpoint. Shes already thinking about mothers day next year. Well past halloween. J. P. Bilbrey. Youre very smart. We know how all of that works with you guys, manufacturers. Thank you for joining us. Appreciate it. Hey, thank you so much. You bet. Byebye. 18 minutes left in the trading session. The dow looks like were going to whoevhover with a decline. Big markets. Dom chu will show us how volatile its been since october 31 1st. Later levin Portfolio Manager is telling us how hes navigating these choppy markets. 200 million to sell so a little bit to the sell side here. Former ceo of sprint dan hesse will give us his first interview since being ousted. That should be interesting. Stick around for that on the closing bell. Design safer cars. Faster computers. Smarter grids and smarter phones. Think up new ways to produce energy. Be an engineer. Solve problems the world needs solved. What are you waiting for . Changing the world is part of the job description. [ male announcer ] join the scientists and engineers of exxonmobil in inspiring americas future engineers. Energy lives here. 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. 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It may not look it but over the course of the past week its been a spooky october. For the past week were just about flat. Were down. 7 of 1 . That doesnt tell you about all the ups and downs weve had. This is, again, going to be the Third Straight time weve moved up or down by at least 200 points in the Dow Jones Industrial average. Just for reference, the last time we had this many days at least of these kinds of swings, 200 points or more, was back in august 8th through 11th of 2011. That was a monday through thursday. The reason why that date is important is because the previous friday was a day that Standard Poors downgraded the u. S. s Credit Rating from aaa down to aa. That caused all the volatility last time. This time were not seeing that kind of catalyst. Back then the dow was around 11,000. These big moves meant a lot more in percentage terms back then. Take a look so far at whats been moving the way. Leading the way is caterpillar, chevron, Johnson Johnson. Exxon mobil and goldman sachs. Focus on goldman sachs, Johnson Johnson and maybe exxon mobil and cat to a certain degree. Those have the highest prices in the dow. The dow is a price weighted index. The higher the stock prices, the more weight the stocks carry. These guys leading to the down side. Now if you look at our market ped come to ter, how many steps weve taken, up and down, up and down, its like a game of chutes and ladders. Weve seen the market move by a total number of steps, or points if you will, of around 2,000. That means weve gone up or down by quite a bit. Down 360, up 425, up 344, down 316. Its been a very volatile october. Remember, some traders have been expecting this, kelly, bill, because remember we heard from howard silver over at S P Dow Jones indices. Of the times theyve posted gains or losses 6 . 25 have come just where, in the month of october . Back to you. Not our imagination. Art cashman came by and signaled. The amount to sell in this market on the close is growing. Were up to 500 million. Down 322 points. Do we hit 340 . 345. Near the low. Not quite there. I think it was monday or tuesday where we saw the previous sharp decline pretty much on the bell. Keep it here. 12 minutes to go until then. Later we have an update on the deadly ebola virus in america. Thats another thing were watching very carefully. Stay tuned. vo rush hour around here starts at 6 30 a. M. On the nose. But for me, it starts with the opening bell. And the rush i get, lasts way more than an hour. announcer at scottrade, we share your passion for trading. Thats why weve built powerful technology to alert you to your next opportunity. Because at scottrade, our passion is to power yours. I was out for a bike ride. I didnt think id have a heart attack. But i did. Im mike, and im very much alive. Now my doctor recommends a bayer aspirin regimen to help prevent another heart attack. Be sure to talk to your doctor before you begin an aspirin regimen. Everyone is looking for ways while to cut expenses. S unique, and thats where pg es Online Business Energy Checkup tool can really help. You can use it to track your Actual Energy use. Find rebates that make equipment upgrades more affordable. Even develop a Customized Energy plan for your company. Think of it as a way to take more control over your operating costs. And yet another Energy Saving opportunity from pg e. Find new ways to save energy and money with pg es Business Energy checkup. Welcome back. About 9 minutes left in the trading session. We are seeing the evidence of that selling that art cashman was talking about. 500 million to sell on the close. The dow now down 330 points approaching the lows of the day as are all the major averages here. Our bob pasani knows about the trend you like to reference. Bill, the point is are we seeing the panic . Are we seeing the capitulation . By that gauge we would say no. Say hello to Larry Mcdonald from new west. I apologize. So caught up with the market. Weve been discussing things. Well catch everybody up. The trade index, it measures the amount of volume going to up stocks versus down stocks. Theres a lot more volume going to stocks. Its usually a negative indicator for the moment. Were not really bouncing here so that would make a lot of sense. What are you making of this, larry . The thing ive been asking everybody, are you seeing this volatility as a buying opportunity or a selling opportunity . Well, were going to have great buying trading moves. Weve had a lot of those over the last couple of weeks. One thing i noticed is weve had three consecutive days with two standard deviation moves back to back, three consecutive. That hasnt happened thats only happened four times in the last 30 years. 87, 2011, 2013 and today. 12 total days the markets been down eight of these 12 with a lot more volatility. Youre expecting more volatility. I would get ready to trade this market. I fear, real fear, were not quite at capitulation fear and sell the rallies for the next two weeks. Were pretty oversold. Were talking about Exploration Production stocks. Were seeing 20 declines in seven or eight trading sessions this month in some of the big shale names weve seen. Obviously theres a concern that these companies become uneconomical when oil gets near 80. Oversold, you talk about standard deviations. Were maybe three standard deviations. The best trade on the board in terms of oversold, the coal names are a spectacular buy down here because if the republicans take the senate, youre talking about pushing back on obamas clean air initiatives. Thats a big win for coal. A lot of people wouldnt want to make a trade predicated on that especially the way the numbers look lately. We think were at 65, 70 chance of the gop taking the senate. Right now the number is 53 seats. Well take a quick break. Well bring larry and bob back. Well see how we do when we get to the closing bell. Family dollar after the bell. Earning season gets underway here. Youre watching cnbc, first in business worldwide. E financial noise financial noise financial noise financial noise maestro of project management. Baron of the buildout. You need a permit. To be this awesome. And you. Rent from national. Because only national lets you choose any car in the aisle. And go. And only national is ranked highest in car rental Customer Satisfaction by j. D. Power. aaron purrrfect. vo meeeow, business pro. Meeeow. Go national. Go like a pro. People find out state farm does car loans as well as they do insurance, our bank is through. Good point. Grab an edge. Look theres two guys on the state farm borrow Better Banking sign. Nope for real theres two dudes on the state farm borrow Better Banking sign. [ reporter ] breaking news from the state farm borrow Better Banking sign. Were seeing two men that have climbed the borrow Better Banking sign gentlemen please get down from the state farm borrow Better Banking sign. Phil get the hose. Okay hes getting the hose. Alright, lets go. [ male announcer ] talk to a state farm agent about car loans that can save you hundreds. Thats borrowing better. Quick recap of what has happened today. Yesterday, 270 point gain on the dow. Today selling. Just intensified as the day went on, in part because of those comments from mario draghi looking to members nations of the eu to help him revive the economy. Here we are near the low of the session. Down 345 a couple times. Now down 300 points as we head toward the close. The ten year yield, yields we havent seen since june of last year. We were at 228. What about oil and are you looking . Is that a contrary buy right now for Energy Stocks do you think . Is it time to look at that . Oil has a way to go. It has 8 dozen. 8 on the down side. Oil in the 30year bond, 30 year is about to break 3 . 30 year telling us that china, japan, and europe are all in recession. If you get a 30 year recession at 3 and oil at down 2 . Demand for oil overseas is such that its going to bring that oil price continued lower he here. Theyll come over and buy our treasuries. Small caps have been the most annihilated. I want to start looking at the regional banks. Theres a contradiction going on. Very hard to reconcile what were seeing. You should be u. S. Centric. We know the u. S. Economy is getting better. Dropping oil is great news for us. Thats the problem, everybody has been saying that for 6, 9, 10 months so everybody is crowded into the u. S. Trade and as the world slows down, that slowing down the u. S. , you have a crowded trade and more value, potentially lower earnings as the world slows down the u. S. Even as oil continues, it would seemingly benefit the most is moving sharply lower. There you have the ebola factoring in. You have all kinds of strikes at laguardia. Thats hurting the transports. But im looking at some of the regional banks versus the big banks over the next 12 months because of regulation. Thats a value place. 1945 is at a low. Larry, thank you very much. Bob. Thank you. Thats it for the first hour. You do not want to miss the next hour. Its the second hour of the closing bell with kelly evans. Thank you, bill. Welcome to the closing bell. Another incredible day at the new york stock exchange. The Dow Jones Industrial average going off the decline of 331 points or almost 2 . In fact, the other major average is hitting that 2 mark with the s p giving up 40 points. Just about the worst day since early february. In fact, the very dejan net yellen took office. That was the other day we saw decline on the s p. The russell 2000 hit hard. Bill said, lets try to make sense. Nom nomiaprins, michelle, how much of this is Mario Draghis fault . I think a lot of it is mario draghi. He has been saying forever, i can do my part, but when we have economies in europe that are calcified due to too much regulation, too many labor problems, they cant grow. I cant fix a problematic economy. I can fix Monetary Policy. So theyve got to do their park. Do you blame Angela Merkel then . I would blame the italians, the greeks, the portuguese. All of them. Even the germans. Blame all of them. But mario draghi also said price stability is his mandate. That works when inflation is happening and when deflation is happening. Hes going to do what he needs to do. It just might be scary as we get to that needing to do point. I see you shaking your head, andrew. I want to say so Everybody Knows in terms of deflation, prices are 0. 3 year on year. Inflation has been on their target for 20 months. They have a problem. They have a big problem. If people dont understand inflation, very simple. Why would i buy anything today if i know its going to be cheaper next week . I wont buy a car today because in a month it will be cheaper. A house will get cheaper. Hang on, everybody. We have a news alert with dominic chu back at headquarters. Dom. Friend of corporate divorces continues here. Weve got some news on symantic will split itself into two publicly traded companies. The board of directors has unanimously separating. One will focus on security and one will focus on Information Management. The separation follows an extensive Business Review of the companys strategy and structure. They believe creating two stand alone businesses will allow them to maximize their Growth Opportunity and drive greater shareholder value. Symantic following the trend of value into two companies. Symantic will be one company to focus on Cyber Security and one focusing on Information Management. At the close theyre down 2 1 2 with the rest of the market. Well see what happens on this news pending hold. Back to you. Symantic had been rumored, speculated, that they would be next after hewlettpackard. Comments on that . The broader trend or if you want to take us back to the markets . Lets talk about everything, kel. Thats the way i roll. Symantic bounced off of that 18 level when the ceo resigned. You can see this stock has woefully underperformed. This is probably a good thing. Who knows, i mean, intel has mca if mcafee embedded in there. Ibm is comprised basically of five publicly traded companies. I think you could spin two of those off. Were in an environment where you can absolutely see that happening. In terms of the broad jerel market when i was with you last i said 1970 was when support becomes resistant. Look what we traded up to yesterday and failed at in the s p. Ive been in this sort of 1904 camp. Were obviously closer to that than we were yesterday. Okay. Ive been saying for a while that the russell has been the warning sign. The weakness in the russell absolutely continues. Yeah. We saw by the way in terms of companies weighing often the dow, it was across the board. We had names like caterpillar. We had names like visa and goldman sachs. How much of this is about whether the u. S. In the midst of everything weve been talking about continues to see strong growth . I dont think that the job today is just about what happens in europe. Theres been slow growth in europe going on. This is just another plea for help. Zero Interest Rate policy, cheap money, bond buying in the u. S. , negative Interest Rates in europe, questions about bond buying, that cannot continue to plug the holes of an overall economy that simply isnt growing. Thats whats coming in. Most of the s p 500 are using their profits to buy stocks and pay dividends to their shareholders to keep markets up. Heres the thing that makes this all so confusing. Look at the jobless claims numbers today. Incredibly strong. I understand that that has a lot to do with weve already had quite a few layoffs. There isnt a lot of supply to go. In the last year, thats one of the strongest periods weve had since 1999. There is some genuinely strong data. It is. You have geopolitical risk in the ukraine, ebola concerns, earnings coming up. Speaking of ebola, we have developing news with a man jab beers. What can you tell us . Hi, kelly. Wanted to give you an opportunity to listen to some comments. They were made earlier in the week by general john kelly. Hes a ma ryan corps general head of u. S. Southern command. He made comments about ebola and the potential spread into the western hemisphere. Theres no way we can keep ebola in west africa. Its going to run its course for some period of time. If ebola breaks out in haiti or central america, i think it is literally barring the door in terms of the mass migration of Central Americans into the United States. General kelly went on to say in those comments earlier this week that Central Americans and south americans who get infected by ebola if that happens, which he thinks is a possibility, will be fleeing either the fear of ebola or the actual infection itself and wanting to get to the United States as a safe harbor or as a way to get better treatment and better medical facilities here in the United States. He says thats the nightmare scenario. He thinks it may be just around the corner. Now that contrasts fairly starkly with the reassuring message that weve been hearing from the white house including in the press conference in which a number of white house officials said the United States is fully prepared to handle this. No discussion of course from the white house about fears of mass migration from central and south america due to ebola. I spoke with the white house about this. They said that they continue to feel that the chances of an outbreak of ebola on any significant scale here in the United States are slim but clearly differing points of view and people who are preparing for whatever might happen. Ayman, thank you for bringing that to us. The gist of his comments have been contributing to the selloff. That was ayman jab beers from washington. Lets get people to weigh in. Dennis, first of all, how concerned are you and how concerned should investors be about ebola and the threat of it spreading further in the west as the general just indicated . Well, i think that investors have to be concerned about it. I think this is getting ridiculously overplayed. I think the media has run amuck with it. General kelly made these comments several days ago. I understand why they have to make them. The odds of ebola becoming an epidemic are minuscule. Compared to what happened in 1918 with pandemic flu, compared to other problems weve seen 4e89 wise in the 19th century, early 20th century, ebola is a small problem. It could become a large one. Right now its weighing heavily on investors psychology. Never discount the psychology. I think its overblown. But the point there, dennis, being from what youre saying, any time we see the selloffs, if its on, for example, fears of ebola, that should be a buying opportunity because its on fears, not fundamentals, is that right . No. I would tell you right now things are fearful enough, the manner in which the stock market traded today, i have to tell you i came in this morning after yesterdays rally and bought a little bit. Within the first hour i pitched it immediately because we didnt respond the way we should have. This market the way it closed this afternoon is still going down a long way, im afraid. Im very dismayed. This is very discouraging. Wow. How much further, dennis . Why was today so discouraging . Kelly, today the manner in which we closed today with a reversal and opening weaker and closing on the highs, you should have followed through and there was no follow through. Draghis comments dragged upon this stock market egregiously today. And how far how much lower can it go . Write this down. It will go down until it stops. It will go down until we get panick panicked. It will go down until the public throws up on its trades. Im afraid today was a very discouraging circumstance. I trade only from my own account. I bought stuff early and i pitched it midday because we simply did not trade the manner in which we should have. This was a very, very bad trading session. Lets bring in greg to see if he could give us a sense as to why, greg . What do you think is going on . Is our market right to be so fearful. Are the fundamentals theyre so fearful about right . You have continued signs of pretty good strength in the United States. The recent data suggesting that Job Vacancies are declining. You have a labor market that seems to be tightening up, reaching the criteria that the fed has laid down for when to start tightening. That alone is reason for people to pause and reassess the assessment that Interest Rates will be zero forever. That collides with bad news coming out of europe. We have an economy as big as america, as big as japan like circumstances and the central back trying hard to fix it but manifestly not able to do it all by itself. Those two things i think are prompting people to ask, number one, do you have tension between the u. S. Situation and the european situation causing the dollar to rally . You have uncertainty about the Interest Rates that create volatility. I think a growth question, fundamental question, can the United States continue to grow as strongly as it does when so many other major growth Economic Centers are flagging. Kelly, i think everybody just needs to take a deep breath. Take a look at the ebola virus. 36,000 people a year in the United States die from the flu. 8,000 people globally have the ebola virus. 4,000 have died. We can take common sense precautions without shutting down the entire country and without the markets going into an absolute crazy, crazy guy rags. Nahomi . I agree with dennis. The ebola virus has nothing to do with the downplay. You cannot plug general economic and regulatory holes with cheap money forever globally. That these problems if they are not fixed continue to exist. You can plaster for so long. The plaster comes off. The market comes down. What do you take in terms of a response . I think companies, for example, have to acknowledge the fact that theyve used money to prop up their stock. We know that. They have to start thinking about investments. The jobs were getting are low paying jobs. Not increasing the average wage. People cant go out and buy things. The confidence will go down and theres a ton of debt that will have problems that will make the mortgage price which is one sector look like a component of what could be a ten year price. Well, im encouraged now. Very ugly. Were still bailing out 2008. Exactly. E havent completely got over that. Europe obviously has to get their house in order before the rest of the world. Well have to see. Wait for europe forever. Forever. Greg, do you think anybody in europe has the ability . I mean, can italy ever right its ship . I dont know. Well, you know theyre unbelievable. Lets remember, italy has been in a quasi recession for a decade so i think that what tells us, thats a terrible situation for the italians. The world grew just fine the first part of that decade. Italy can continue to come along without fixing the problems if we can get europe to grow if we can get the rest of the economy to grow a modest rate. We are not expecting barn burner rates. The situation in the United States, weve been getting up side, not down side based on the economy. Lets keep something in mind. Weve had absurdly low volatility for a number of years now. Part of whats happening, were trying to get a normal volatility. That will push the equity risk premium up. That will make valuations come down. That may be a healthy thing. We have to go. Greg, i will give you a hat tip. You told us weeks ago thats what was going to happen. We are seeing it play out. The ball is in the policy makers court here. Thanks, dennis and greg. Everybody keep us posted on your thoughts on the markets. Guy, well let you go. Guys coming up with the fast money crew at 5 00 p. M. Theyll talk about the black hole the black gold is falling into. Its an energy wreck. Investors getting motion sickness from the market volatility. What should investors be doing right now. How should they put their money to work . John levin is here to weigh in on that. Thats next. Stay tuned. To retire. Not if. Sometimes they just drop in. Always obvious. Cme group can help you navigate risks and capture opportunities. We enable you to reach Global Markets and drive forward with broader possibilities. Cme group how the world advances. For over 60,000 extra curricular activities help provide a sense of identity and a path to success. Joining the soccer team. Getting help with math. Going to prom. I want to learn to swim. Its hard to feel normal, when you cant do the normal things. To help, sleep train is collecting donations for the extra activities that, for most kids, are a normal part of growing up. Not everyone can be a foster parent. But anyone can help a foster child. And if enough werent happening, now Family Dollars results have hit the tape. Come to is looking through it. What can you say . Were sifting through this. Right now the stock is down by 2 1 4 on very light volume. About 1700 shares have traded. The headlines coming out here, first of all, Family Dollar reports earnings of 73 cents a share. That misses the average analyst estimate of 77 cents a share. Revenues, however, come in slightly better. 2. 61 billion. Analysts were expecting 2. 58 billion. They also did say that q4 Comp Store Sales were up. 3 of 1 versus up. 1 . So better Comp Store Sales. Also, no guidance will be provided for the pending possible deal with dollar tree on that merger and acquisition front. Again, a miss on the bottom line narrowly. A slight beat on the top line. Comp store sales slightly better. What we have here is a stock, again, thats down marginally about 2 1 4 but about 8,000 shares of volume. Very light trade so far kelly for Family Dollar. Back over to you. I think everybody is taking a breather, dom. Thank you. Speaking of that, my guest has been managing money for better than a decade. John levin, ceo of levin capital strategist. Im sure you can tell us. That is not what i came to discuss. We will talk aig in a second. I think listening and being on the exchange and being with you, i think for quite a number of months the market has tended to ignore certain kinds of problems and tended to move up while it emphasized some of the favorable factors, and i think in a broad sense it was overdue. The negatives are well known. So in terms of today, it wasnt startling new news and in terms of yesterday, the fed had a statement. But the market is incredibly building up its volatility based on is it the good news of continued easing and liquidity or bad news . Its not bad news but there are several things going on that are giving people pause. One is definitely the rise in the dollar, which is shading revenue estimates for the Major Companies and shading earnings. Its known. Its been going on for weeks. Professional investors are talking about it. If the market goes down, its something people can focus on. The other thing i think is disconcerting is the phenomenal break in certain Commodity Prices which is a sign of weakness in china and some of the emerging markets. Ive not talked about the international arena. United states business continues to be moving ahead. Let me ask in a word before you go onto the topic youre here to talk about, aig. Is it the kind of market that you sell into the weakness or do you buy into it . Our general strategy has been for years is to buy quality weakness when we can. Okay. And weakness is generally a buying opportunity on a selective basis. Stay right there. The other story were watching here closely is the aig bailout lawsuit. John with you earlier this week with some strong views. Theres a lot happening today in this case which our Mary Thompson has been watching in washington for us. Today was former fed chair ben bernanke taking the hot seat, mary. Mr. Bernankes first turn in the chair was far less cordial than tim geithners. He appeared slightly combative and vaguely annoyed from the questioning from david boyce mostly providing curt responses like yes, sir, i dont recall. They got an exchange of aid package and loans and commitments. Asking bernanke, as you understood it in 2008, did rates include equity . Bernanke, i dont recall. They claim it violated their fifth amendment rights by not compensating them for that. Geithner and paulsen is trying to paint the officials as forcing a slap dash agreement that failed to properly value the company and unfairly punish its shareholders. As for why the equity stake was taken, bernanke did have an answer to that telling the court it was taken for the public saying, i know the equity component was additional compensation to the taxpayer for the risk being taken. Mr. Bernanke had to leave court around 3 15 today. He will be back tomorrow morning for more questioning and well be here to cover it. Kelly, back to you. Mary, thank you so much. We really appreciate following the story, one that john levin is following closely. You were one of those shareholders back in 2008. You remain dissatisfied with the handling of this entire episode, dont you . Correct. In view of the time im going to make four simple points. The preface to the point is a lot of us believe despite the goodwill and the expertise and the problems of the man running the country, that there was an abuse of process and an abuse of law and favoritism was paid. The first point is that the terms that were imposed on aig were punitive. None of the counter parties suffered the same thing. Citi corp and the others, lower rates. Different policies. Bear stearns, citi corp, fannie mae. Second point is we dont believe the law was followed. Aig is different than fann fannie mae. Aig is a state chartered company. On the new york stock exchange. Many opportunities for a shareholder vote. The third point is the board was supine. Once the money was in they could have negotiated better terms. Right. And they could have had a shareholder vote. The third point i want to read from mr. Paulsens book, the beginning of it, because i think this characterizes part of the problem. Mr. Paulsen said the president bush asked me, he said, the very first words of chapter one, do they know its coming, hank . Question mark. Mr. President , i said, were going to move quickly and take them by surprise. The first sound here is their heads hitting the floor. This is how fannie mae and freddie mac went under. This is the process that scares people. Aig has nobody to blame except themselves. The federal government didnt want to put 182 billion of taxpayer money at risk. For aig and mr. Greenberg to say, gee, these terms are too onerous. They could have followed the process. Follow due process, absolutely. If you didnt give them the money theyre gone and god knows what happens to the economy. For them to be complaining i agree on the complaint and there should have been a better process. The reality was aig was being downgraded. Because it was downgraded it could not ensure all of the contracts it had with the largest banks in the company and their codependent banks. The first chunk of money went to pay off the margin calls to these banks. Exactly. It was a funneling through the banks. That should have been considered. The whole thing should have been considered. That is my point. In my view, aig first and foremost, everybody for the money through aig. That doesnt invalidate. Less money would have been required if the terms of payout had been different. Its whatever the necessity, that didnt apply what should the Interest Rate have been, 20 . It should have been something punitive as a moral hazard to make sure they dont engage in this reckless activity that got them into this position in the first place. The only question is whats aig saying, the terms were too on ner sflous we couldnt make good on our debts but the terms are too onerous. I think the lawsuit is frivolous but the federal judge will decide. Michelle. Question about due process or general principal . They were incredibly onerous. I dont know if you recall, capital fled the market. People around the world said, oh, my god but theyre not 14 Interest Rate. A 14 Interest Rate is probably what should have been charged. It wasnt because of the Interest Rate, the system was failing. The money was going out because the realization there was so much codependency. The Interest Rate the Interest Rate Interest Rate had nothing to do with saving the system. Nothing. Exactly. Interest rate was a political judgment in my view before the election for congress and the politics. Citi corp after the election got 8 . What was the alternative . Should we have simply given them an interest free loan and you got in trouble in the first place. You know what, goldman sachs, youre not going to get 100 cents on the dollar. We are on the cusp of a Global Worldwide depression. The government had to act quickly. Did they prevent it . Yes, they did. They prevented a Global Worldwide depression. We are still in it. If i can say respectfully, that is the most fabulous point because i believe always that legal and appropriate process is necessary. The governments just cant take arbitrary action under the thing that they say the system, picking winners and losers. But at that time i think its different. No. And its clearer how many years, five, six years were pretty much at square one. John levin, youre so right. Thank you so much for being here. I appreciate it. Well have much more as we follow Ben Bernankes testimony. Right now well send it back out to dominic chu for a market flash. Dom. It is seven minutes past when symantic shares reopened. One company is focusing on Information Management and the other on Cyber Security. Theyre up 2 1 2 . Again, we have a trade. Shares are up 2 1 2 on news it will split itself into two separate publicly trade the zblps another breakup rewarded, dom. Sprint stock seeing a down day today on this market. Theres a new pricing plan, a new ceo trying to boost the companys fortunes in the wake of ceo dan hesses departure. Well get his take here exclusive exclusively. It is his first interview coming up since leaving sprint. Also indias stock market has been blowing away the rest of the emerging world. This year a 26 gain has a lot to do with this man. Later the head of Indias Central Bank here to talk the Global Economy and markets in a rare interview. Stay with us. S that capture their emissions. Build bridges that fix themselves. Get more clean water to everyone. Whos going to take the leap . Whos going to write the code . Whos going to do it . Engineers. Thats who. Thats what i want to do. Be an engineer. [ male announcer ] join the scientists and engineers of exxonmobil in inspiring americas future engineers. Energy lives here. receptionist Gunderman Group is growing. Getting in a groove. Growth is gratifying. Goal is to grow. Gotta get greater growth. I just talked to ups. They got expert advise, special discounts, new technologies. Like smart pick ups. Theyll only show up when you print a label and its automatic. We save time and money. Time . Money . Time and money. Awesome. Awesome awesome awesome awesome all awesome i love logistics. Welcome back. We begin with dominic chu. A very busy day, dom. Very busy day. Focus on the oil side of things. Crude oil, west texas intermediate. It continues to fall in the after hours. In the evening session, its currently trading right below or around 85 a barrel. It did dip below 85 a barrel since november 15th of 2012. Almost a twoyear span. Oil down 83. 71 right now. Oil, kelly, trades below 85 per barrel. West texas intermediate for the First Time Since november of 2012. Back over to you. Ouch. Thats all you can really say for oil today for the markets generally. Were taking the pulse of markets in the economy. Lets bring in somebody who was at the helm in the face of one of the major Wireless Companies in america. Former ceo daniel hesse, welcome back. Good to see you again. Good to see you, kelly. Thank you. How are things . And you can take that wherever you want. Personally, with the u. S. Economy right now. Well, personally, theyre great. Im getting to spend time with family and friends and traveling. Based upon the stock market today, im no expert with respect to the stock market, but things could be going a little bit better. The u. S. Economy seems strong but there are concerns with the Global Economy as well as its impact on u. S. Exports, isis, ebola, a few other issues. Things are good with me. I want to talk a little bit about what happened at sprint. Do you have any regrets about leaving the company and what do you think about where its heading today . Well, from what i can see, i think sprint and marcel are making the right moves. It was a great move. We had a transition a little over a year ago. The transition was mutual and very amicable. Im pleased with how sprint is doing. Do you think the wireless market in the u. S. Is competitive and needs to stay competitive . Or should there be tieups allowed, for example, between some of the smaller players . Well, from a pricing perspective, i think as the consumers look at it, they do see a lot of competition in the area of pricing. The real question is how sustainable is that if more consolidation isnt allowed in the industry. For example, sprint, tmobile and others. At t and verizon is very large. They almost have monopoly power in the industry. There is a question long term if the level of price competition that consumers are enjoying now is sustained. Do you want to answer to john lejare who love to take issue with the framily plan. His whole tact is to attack your strategy. That is johns strategy. John and i used to Work Together at at t years ago. So i know him pretty well. So it does not surprise you . No. Thats his thats his personality and, quite frankly, hes been quite effective. When you look at the product that apple is launching here, iphone 6, are you going to buy one . Is this going to continue to put pressure, create opportunity of other Wireless Companies, do you think . Well, from what i can tell, and i dont have any inside information, but the iphone 6 has been extremely successful. Actually, significant change from the 5s. Im very happy with my current phone so and im not upgrade eligible yet. Now that im not working at sprint i have to worry about things like that. Yes, those percs do matter. Finally, whats next for you . Whats on the docket . I dont know, im going to take six months or more just to relax. Ill use the time to think about what i want to do next. I havent made any decisions. There seems to be no shortage of ceo opportunities out there lately. So much turmoil and transition in the u. S. Space, u. S. Consumer space. Daniel hesse joining us after he left sprint. Daniel, thank you so much for your time. Thank you, kelly. Todays market selloff may be in part due to concerns about the Global Economy. Up next well get a view about how important part of the world is when we hear from the bank of india. Another 200 plus points in the tegtive. Some of the hardest hit stocks today. Well be right back. [light instrumental music] female announcer recycle your old fridge and get 50. Schedule your free pickup at hes one of the smartest minds in economics. Theyre up more than 25 this year unlike here in the u. S. The reserve bank of india is resolving to keep Interest Rates high. They have a problem with the Interest Rate hovering around 7 . I see steve sitting down for a rare interview with the governor of indias reserve bank. Steve . Lets just say i followed his work closely, steve. For years. 4. The governor of theback of india, thanks for joining us. We covered u. S. Reporters at the university of chicago. We learned a lot from you. Today the markets u. S. Is one places strengthening. How important is that for the reach a skate velocity. What if it doesnt . Were hoping that the u. S. R there. Unfortunately every year at the beginning of the year we think by the end of the year itse1 d] took 2. One of the things i thought i knew about Monetary Policy, centrale1nri] bankers could get inflation rate. I look . ; around the world and i see key central bankers losing this war onni disinflation or deflation. They cant seem to get the inflation. Whats going on in the world in your opinion that these Inflation Numbers keep coming any lower while they keep putting on the accelerator more whe i ie comes to Monetary Policy . Essentially Monetary Policy has limits. Xd every time you press the accelerator you pump more banks are not lending and increasing credit. Then Monetary Policyco is pushi on the strength. Many countries are in that situation now. eqiq . We in india dont have that problem. I want to talk about india in just a second because its astonishing how different it is from the rest of the world. I want to focus on the globe for one more question here. This issue of Monetary Policy and the ability to get traction and get out of the current trap that they seem to be in right now, do you think that europe and mario draghi has the ability place or are the politics just too difficult . Well, i dont know. I thinke1 mario draghi has time3 europeju the political system has to take that forward through the reforms that are needed in what we have to wait and see ise getting now to india. One of the things youve spoken about is your concern about u. S. Rate hikes. Is it still something that concerns you and the effectni o indias3ni youve said we have nojf longer cooperation. Is that still true . We hit the temper tantrums in july of last year. Since that time weve had two other episodes. Argentina hadi] problems. E1ni india came through very safely india was relatively calm at that time. My sense is were in a much better situation relative to them because there have been major changes in indias macro stability. Weve got a lower fiscal deficit, lower infuu jjy whats your inflation rate . People arent going to believe that. What is your inflation rate there . E17. 8 as of the last count. Everybody else is near zero. You have 7. 8 . Yes. Its been coming down . Its been coming down. People are beginning toni believe sometime next year youre going to cut Interest Rates. Well, we believe that. I canti] enlighten them on tha now. As far as reaching our target of 6 by the end of next year goals, but if the data come in more friendly well be in a position to cut rates. If theyre morexdni hostile to inflation targets wellnr have raise corates. Were deeply dependent as the fed would say. Person here in the United States s hes very pro business. When you, at him, what is your view of the effect it will have on 8ocv the Indian Economy . Stable governmentc is a very bi plus for india. There was a lot of politicalco uncertainty that has been removed by the vast majority that the government has. Secretary, its a businessi] friendly government. Its working at the micro level, clearing out the regulations, dr ah ar as say taxation goes. So thelpco number of places whe theyre trying toconr improve t business environment, they have a goal of bringingo[ india on t world bank scale down from 130c on how easy it is to do business to the 50th country on that list. Lets see how it works out. Action is happening. Thank you for joining us. Ill see you when youre back in chicago several years from now. Thank you very much. Kelly back to you. Rock star in the economic world. Rock star in the political world. Exciting times in india. Steve, thank you very much for that interview. Some think ebola fears are contributing to the worldzvxd mt economy. Theyre saying ebola could have serious economic costs. . ; serious economic costs. . ; well have more come back. Stay with us. I see how youve been investing. Setting long term goals. Diversifying. Dip you got our attention. We did . Of course. Youre type e well, i have been researching retirement strategies. Well thats what type e s do. Welcome home. Taking control of your retirement . E trade gives you the tools and resources to get it right. Are you type e . vo solver of the slice. Pro. Teacher of the unteachable. You lower handicaps. And raise hopes. And you. Rent from national. Because only national lets you choose any car in the aisle. And go. You can even take a fullsize or above, and still pay the midsize price. pro nice drive. vo well played, business pro. Well played. Go national. Go like a pro. No sector is left up touched by todays selloff. Contributing to the airline ebola fears taking a turn for the worse. Our meg turrell is back from e1 dallas. The first death from ebola happened yesterday. She joins xdnus. Thats right. Yesterday the u. S. Announced enhanced entry e1screen. They handle 94 of allxd travels coming in from the three affected t countries. Today weve learned the u. K. Also plans to ramp up screenings at londons airports. The cdc has advisedqe1 from blocking flights saying it will be counter productive. The virusxd is taking ane1 econ toll as well. The World Bank Says ebolast Financial Impact could be e1 32 million by 2015 if thei] epidem affects neighboring countries. Its severe in liberia, sierra leone and guinea could be catastrophic. Key stakeholders met onw3 ebola today in washington. Is based onnr the notion that w dont get these services in place, and if we dont, cases will start to move to other countries. 32. 6 million is not because of the virus itself. 80 to w390 itself is the aversn behavior. People dont go to work, people dont go to school. No flightse1fa coming in. Trade slows dowaf cdc director tom frieden says hes hearing from people thatxd theres been a reduction inok africa that are no way involved with the outbreak. This morning he compared ebola to another virus. In the 30 years ive been working in public health, the only thing is not the worlds n aids. Today, more than 8,000 cases of ebola primarily in liberia, and see jere leone and guinea and nearly 3,800 deaths which the World Health Organization says is underreported. Well, that comparison to the aids is going to raise concerns. Thank you, meg. That story is front and center in the market of the 300point selloff today. Much more when we come back right back. vo watching. Waiting. 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Well, kelly, lets go through the whole thing the dow is wiping all of the big gains by the end of the day. And you have leading the way caterpillar, and goldman saks and john johnson and walt disney and united tech. And again, vodafone this afternoon, and they cut the rating on the mobile communication stock to reduce from the neutral competition. And the weakest sector in the s p 500 was oil, and exxon and chevron and majors and anadarco, and halliburton and neighbabors also jcpenney getting hit hard in the Third Quarter session after sales warning, and so a lot of red letters across the board and especially in the Energy Stocks, kelly. Well, mark hagan is not happy today. Or maybe he is filling the boots with a cheaper jcpenney. Thank you. And next week, we will have a panel with the review preview. We will be right back. [ male as 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. Unless your passion for innovat on is nonstop. train horn vo wherever our trains go, the economy comes to life. Norfolk southern. One line, infinite possibilities. I lochecked bag. Free with my united mileageplus explorer card. I have saved 75 in checked bag fees. Priority boarding is really important to us. You can just get on the plane and relax. I love to travel, no foreign transaction fees means real savings. We can go to any country and spend money the way we would in the us. When i spend money on this card i can see brazil in my future. I use the explorer card to earn miles in order to go visit my family which means a lot to me. Welcome back, and a final thought from the panel where oil went to 84 and on a remarkable slide s. That good news for the people at the gas pump filling up more cheaply . I think it is, sure. And i think that it is. And the next three days every central banker known to man will be at the imf meeting and listen for the dutch and the austrian and finnish banners, do can they support mario draw gi or the fed . We will have real market moving headlines. Yes, out of places that people would not expect . Yes. Naomi . We will see the down moves regardless of next week. They can cat tall iize catalyze with the u. S. And the Global Economy is not going to be restored by cheap bonds. It is going down. And do you think that the u. S. Reserve was called out in the meeting . Well, the reserves not being used in productive measures and he said it in a different way, but 2. 5 trillion for the banks to use and they have done nothing to grow. Nothing. And that is the problem. And pushing the strings. Well, i am dying to see the end of the aig trial and i cant see any scenario where they prevail, and it is the classic case of the kid who kills both of the parents and then cries that he is an or fa and it is the ultimate of chutzpah. And he is a lawyer. So encouraging the fiesty debate, i encourage you the go watch. And we will hear more from chief ben bernanke, and the fed would like to hear some thoughts on the Monetary Policy at this juncture. Well a good lawyer would at least ask. What does it mean for us now . Well, you need him on the show. And we are dealing with the legacy of all of this, and thank you for joining us this hour, and a 300point drop in the dow jones today. We head over to melissa lee, and what are you making of it . Well, thank you, kelly. And talking about the big drop in crude oil which is in its own bear level since summer levels and we have an expert and you dont believe where he is headed next by november in fact. All right. Over to you guys. All right. Fast money starts right now, and live from the nasdaq marketsite life in times square, im melissa lee. And now the today, closing out all of the gains yesterday and closing out in the lowest levels in three months. And also ahead, we will have one underperforming internet stock that could be a safety play, and we will look at the ebola treatments, and separate the fact from the fiction, and of course, we start with the return of the volatility, and the s p 500 is moving 1 in three Straight Days and more than a year that has happened and the volatile si rising 24 . Dan nay