Transcripts For CNBC Closing Bell 20150211

Well have the numbers the moment they cross and the best analysis in Business News. Of course we are waiting for president obama during this hour to speak at the white house. Set to speak about his request for congress to authorize money and power to fight isis abroad before they infiltrate the United States. Well bring you, of course his comments live as soon as he takes the podium. Lets have a look at exactly where we are on the markets right now. The dow at its lows was down 109 points. Its quite a strong comeback although i guess for your Broader Market the s p still negative for now the third time in four sessions. We keep trying to make a hit at 2,068 and keep failing on that. Were five points higher than our recent range. The nasdaq is higher. This is the third decline in four sessions for the dow and the s p 500. Okay. Lets bring in our contributing panelists today. They include Keith Fitzgerald from money map press, Jack Bouroudjian with us from index Financial Partners jeff reeves of investor place. Com, meg green from Meg Green Associates and, of course our very own rick san tale santelli. Jeff, you really like the markets. Yes i think which jeff . I think the numbers were strong from the jobs number. Weve seen an uptick in oil. The pessimism over greece is a little overblown. I think investors have a short memory. I think were pretty good right now if you look at the grander scheme of things. Earnings have been okay. The blended growth rate is 3 . Im pretty optimistic. In the meantime we keep coming up on the s p 500 against this 2,068 level. We approach it and fall back and thats been very much kind of the situation for most of the year. Why do you think were unable to make further gains at the moment . Well, i think its partly just investor sentiment. I think investors are kind of waiting for the other shoe to drop, but i do think, again, long term investors dont have a lot to look beyond the volatility of january. I think we have to have a catalyst to get us out of this funk but earnings have been pretty strong. The blended growth rate is 3 . In some subsectors of energy were negative 20 yearoveryear earnings growth. I think to put q4 numbers up that are modestly okay and a lot of people have beat expectations considering the big head winds weve seen i think all well need is a little more good news and some more reassurance from the fed and i think were going to see a strong finish to 2015. Jack with all this hand wringing over greece and whether they will finally be able to strike a deal or answer oon extensionex an extension, here are some refreshing thoughts greece an exit doesnt really matter. Can you say that with confidence . Sara look and simon, weve talked about this two or three years ago i remember because we were talking about an implosion in europe at the time. All of us know that the economy in greece doesnt really matter in the overall grand scheme of things. Its more of a structural issue. Its adding into the greek bonds. Its the structural issue that is are the problem. If we were sitting here talking about germany leaving the eurozone, then we would have a serious issue on our hands, but the reality is if greece leaves guess what . Its not going to be that big a deal. And if it was going to be a bigger deal, we would see a lot more volatile in the markets. The fact is the subdued trade were seeing and it is subdued, tells us the market doesnt think its a big deal. Meg, where are you on munis . A lot of people say perhaps the taxfree. Where were you suggesting clients go . We love the muni market right now. People are looking for yield. We also like the stock market dont get me wrong, and worldwide theres a good market coming, but munis are basically funding 75 of our infrastructure. States are doing much better. Remember a lot of them can raise taxes themselves. So if people are looking for yield and theyre afraid to go too far out, although i dont happen to think Interest Rates will be going up so fast not by the fed anyway but i think if you really are looking for some yield and youre looking to save a few taxes and youre going to the intermediate muni area and youre careful about it i think you can really have a nice safe return there. Thats not the exciting bit thats in the market. Right. Well no. Speaking of yields rick santelli, had a pretty decent bond auction. Above 2 on the 10year. Was that notable . I think its notable because its a psychological level but, trust me i think at least in my opinion, theres very very great chance were going to be spending a lot more time in the next few sessions above 2 than below even though it might not be big, but what is big is the fact we settled here at 2. 17 . With regard to greece, obviously that meeting is going on now and i agree with jack it isnt about greece but greece is super important. Anybody who is a parent understands why. If you let greece get by with a couple things here and a couple things there portugal is going to want it spain is going to want it france is going to want it. Thats why they need to draw the line. Its not about the size of the economy, its about the size of their notable demands for more for less. Maybe they should start collecting some taxes. Spoken like a true german rick. Now youre talking. Who said that . To me guys greece is like a bug in search of a windshield. They have a lot of obligations, they lied to get in thee u, they mismanaged themselves for year, now they want to renege on their obligations and then some. The question is not like greece itself. Its like letting montana go out of business. Its a dizaisy chain of collateral traders hang on hackng on. Youre really confusing me. Most of the greek debt is held by governments or Public Institutions like the ecb. I think for most people i dont want to dwell on greece forever, but weve got to do it its in the news and its merckingaking headlines. Its more about the run on the banks. Whether the greece people pull their money out of the banks. Thats the fire isnt it, that might not be contained here . Well i would take issue with that. I think thats certainly an issue if youre local and if youre in greece. I think the other issue is much broader than that. I think its the derivative traders who have offset the risk. The worldwide Financial System has rehypothecated eight or nine times. Nobody knows who has got it. If theres a run on the banks, everybody will be looking for that buck and thats going to be what the shortterm disruption is to the market. If greece debt settles, if they get a deal there will be a sigh of relief. If greek debt gunt go look whats happening. Traders are subdued because nobody knows where the risks lie until everybody comes out of that meeting. Jeff what also happened but argentina defoughtfaulted and it wasnt the end of the world. They didnt have all the eu backing it. Right. It wasnt that cascading effect it could happen to others. Jeff, i want to turn it back to u. S. Markets right now. Were seeing utilities lagging again, tech and health care outperforming and Energy Continues to swing around here with what were seeing in terms of crude oil. Do you see that as a big factor as a big drag on the overall equity market or have we gotten past that point . Is it really only going to move the Energy Stocks . There are Energy Stocks that have actually kind of bounced back a little bit lately. So again i think it depends what time frame youre looking at whether its the last week versus yeartodate. But if you want to get forward looking about this one sector i think is coming into vogue right now amongst tactics its pretty important to talk about is Cyber Security with all the stuff we saw with aetna or im sorry not aetna, i want to say athena anthem. Yes, with anthem. And on the heels of sony and on the heels of target on the heels of Everything Else i think Cyber Security is kind of getting in fashion right now. If investors want to look at a segment of Technology Stocks i think Cyber Security offers a lot. Meg, what do you like in the stock market . We covered the munis. You say you still like stocks. Which part of the market . I like the broad market. I really do. Im always a small cap girl and sometimes i lag behind, but i like the small caps, but techs did not do that well except for apple flying so were looking at a really good tech rally and they keep knocking things down for Interest Rates. I dont think this market is being volatile about greece. I think its all about Interest Rates. I remember a year and a half ago when we were worried about the taper and everybody was fearful what was going to happen when the fed tapered and it kept everybody off balance. Right. Well thats done and now theyre saying when are the rates going to raise. Every time you think a rate is going to go up the utilities get knocked. They were great last year. Utilities are getting hammered again. Down 2 . Utilities are not just about income. There are a lot of utilities that have a lot going on thats far above and beyond just the yield. People look at utilities and say Interest Rates are going up, knock down the utilities, knock down the preferred stocks. I think you have to look beyond that. Theres an awful lot going on in the utility world. A lot that has to do with new energy looking for different places to so you cant just take utilities and put it in a broad brush. But thats why i say that the Interest Rate scare of raising the Interest Rates, and i dont see the reason for them a couple reasons but, you know, i think that thats whats spooking the market. I remember that taper was the big spook. So, you know, take a look and say utilities are still utilities. You cant ever deny yield if you are a longterm investor and you want to have utilities in the portfolio, you want to have yield, and with these Interest Rates being the way they are, look at microsoft. Went out 40 years on a bond. Microsoft is borrowing money. Apple is borrowing money. What is that telling you . Theyre going to be buying back their stock so you love the stock market and you love the economy but Interest Rates have to remain at zero for you to keep that love going. Well rick youre talking about corporations that are making money. Look at the earnings that are coming out rick. How can you then the fed should have no problem. They should have raise rates like three seconds ago. This has become the inspite of stock market rally. In spite of the fact that people are scared we the economy has improved in spite of all it. I think its more like a country dance, one step forward and two steps back. Were going to leave it there. A fiery discussion. Thank you for your time. Have a great evening. That was exciting. Less than 50 minutes to go before the closing bell and were looking at the dow now down less than 40 points. The nasdaq remaining in positive territory as apple makes new highs up another 2 today. The s p 500 is pretty much flat. Up next a big guest, howard lu lutnick speaking exclusively with cnbc. When he thinks the fed will raise rates. Plus the earnings parade continues. Cisco, metlife, tesla, and whole foods among those companies reporting. We will bring you the numbers as soon as they hit the tape. Were awaiting president obamas statement on the authorization for military force against Islamic State. The president expected any minute now. Stay with us. Female announcer through president s day, get 36 months interestfree financing, and save up to 300 on beautyrest and posturepedic. Even get three years interestfree financing on tempurpedic. Plus, free delivery, set up and removal of your old set. And sleep trains 100day money back guarantee. Keep more president s in your wallet. This special financing offer ends president s day at sleep train. Guaranteed sleep train your ticket to a better nights sleep a live shot of the white house where we are expecting president obama to address the nation make a statement on his request from the u. S. Congress where he sent a letter today to authorize military force to, quote, degrade and defeat the Islamic State forces in the middle east without sustained largescale u. S. Ground combat operations. Of course, this is stirring a lot of debate within congress and lawmakers, and, of course it will put them on a path to a vote. Lets take a look at how the markets are doing as we head into the closing bell a little less than 45 minutes to go. Were still seeing declines with the dow down 45 points. The nasdaq has remained in positive territory. If we close lower third day in four sessions of declines for the s p. Okay. Threequarters of an hour until we shut up shop. Lets see whats moving with dom chu. Lets start with apple. Another record high in trading today. Activist investor carl icahn is tweeting he thinks apple is worth 216 a share in todays mark and even more if they introduce a Television Product in 2016 or 2017. He anticipates a Capital Program will include a large increase to shares. Pepsico reported better than expected earnings. The pipeline of new products is perhaps the strongest in its history. Bgc partners reported earnings slightly better than estimates. Shares are negative. The interdealer brokerage and Real Estate Company says it expects fiscal First Quarter pretax earnings to be between 68 million to 80 million. The Fiscal Services business improved and the real estate business continues to benefit from positive trends. Back over to you guys. Thanks. Were going to pick it up right there. Break down those results with the man in charge. Joining us now exclusively is bgc partners chairman and ceo howard lutnick. Its good to see you again, howard. Great to see you guys. You posted an 18 million loss in the Fourth Quarter despite better revenues increased volatility which you like. What do you attribute the loss to . Look we settled a longrunning lawsuit. That was just our gap earnings. If you look at the operating earnings of the company, we had our second record in a row, and were guiding for our third record in a row. Revenues were up 20 . Profits were up 50 on the quarter. So we just had one settlement to try to wash out the past and just resolve this stuff, but the company is really hitting on all cylinders. Its really doing great. So its a great opportunity. We also announced we expect to raise our dividend next quarter which usually your viewers kind of like to hear. Theres no doubt about that mr. Lu tnick. Where are we on gfi group, the new york brokerage that youre trying to get your hands on for just shy of 800 million. Have you got enough people signed up for that because i see that your sixth deadline looms. So close, so close. So last week we need 45 , 45 at 6. 10. Last week we got 43. 3 . So we said, okay this thursday thursday in a week february 19th we expect enough shareholders to come and we will cross the 45 line. So were very excited about it very optimistic. We were up from 30 about a month ago to 43. 3 , so come on. Its so close. Yeah. Howard are you going to have to push the extension farther than next thursday if you cant get to that number . Look right now from my opinion, i cant imagine that the shareholders dont come across the line. You know i dont know that people expected us to get so close. You know they had a deal management had a deal with the cme. That was voted down. Were the only deal. Its 25 cents higher than theirs was anyway. Its all cash. I think next thursday is going to be a good day for the company. Were going to cross the 45 and off we go. I guess you might not have got enough acceptances yet because there are these reports that mickey gooch, who you know extremely well clearly doesnt want to get it go and he may be working with icap or other people to try and get some sort of counteroffer again on the table. Why would people kind of sell out now if there are those sorts of reports around that hes doing his best . I like the way the New York Times took it. They put a space and they wrote, seriously, put another space and big question marks. This has been going on for six months. If anybody else had any interest they would have come a long time ago. The difference between bgc and all these other guys we have the money. We have liquidity of 820 million. We have 20 of the Nasdaq Stock Market which is worth 625 million. We are a really really rich Strong Company capable of buyingg fbuying gfi for cash. Its a good transition for everybody. I think the management will come around to it. I think the shareholders are coming around. So i would expect that we should cross the 45 and move onto the next level. Company is hitting on all cylinders. Real estate business loves the low Interest Rates. With the company raising its dividend, i think were in great shape. Our yield was 5. 5 today. Next quarter off it goes higher. Why is your cfo stepping down . We learned Graham Sadler who has been with the company for a yew ears is going to be leaving. Does this have anything to do with the takeover battle you have been dealing with . I think it has to do with his 59th birthday. Hes retiring. He was the cfo of bear stearns europe. Hes a great guy, and, you know, hes 59 years of age, and he said, look ill stay as long as youd like. Id like to find my replacement. Hes involved in the search. This is a lovely retirement with a retirement party. Anything to the contrary is just silly. Hey howard what do you think of the markets . Well look low Interest Rates are great for a whole variety of categories. The u. S. Economy is growing much faster than people think. 3. 5 to 4 . But the end of tapering, right, with the tapering means we have the easiest Monetary Policy in the history of the world. You have europe falling off a cliff. You have to assume stocks will continue to perform well because we have low Interest Rates. If the fed raises in june or october, it doesnt matter. It would only be a quarter of a percent. Low Interest Rates means stocks melt upward and nice growth in the u. S. Economy. Feels good. It just feels right here. I like the markets. All the action howard is in the currency market. Highest volatility in nearly two decades. How are you capitalizing on that . Are you growing your Foreign Exchange business . I know you have recently started to do more in terms of trading and that was in the results today. So the bebsst part is we have a fully electronic Foreign Exchange business. The Foreign Exchange business we were up 50 in revenues and 80 79 in profits last quarter, this quarter, the Fourth Quarter. So just incredible numbers. Great volatility. You know our fully electronic business, people dont really think about the fact that you take a business like ours in the wholesale Financial Markets and move it electronic the profits explode. Thats why earnings were up 50 . We love the currency markets. Were in a great spot electronically. Volatility is a friend of the company. We hate boring but we love when its chaotic. Aint that the truth. I love how fired up you are. Howard lutnick, always good to see you. Chairman and ceo of bgc partners. Lets have a look at where we are on the markets. Down 23 on the dow. We continue to cut those losses sara. Were awaiting a statement from president obama any minute now. The president pushing for congress to authorize the use of military force against isis. Well bring it to you live as soon as he starts to speak. 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A new investing and Banking Experience with personalized guidance and online tools. Visit a branch, call or go online today. Youre watching the closing bell on cnbc. A shot there of the white house where president obama is expected to speak any minute now. He just asked the u. S. Congress to authorize military force to degrade and defeat the Islamic State. We will continue to monitor that shot for you and as soon as the president comes, well take it for you live. Okay. Its time now for our weekly beat the street segment where we highlight a fund manager who is outperforming their respected bench mark. This weeks fund is the schroders tax aware value bond fund. Its actually up about 14 over the past year against the benchmark the barclays Municipal Bond index which is up 9 . Proof positive that if you wait around long enough two britons will turn up. Joining us is the fund manager, schroders. Thanks for having me. The name of the fund tells it all. We target the maximum after tax total return whether its in Municipal Bonds or Corporate Bonds so we combine a team of specialists on the credit and the muni side, try and take a longterm strategic view ignore the noise as best we can when you say noise, do you mean Federal Reserve Interest Rate hikes. Its a bit early for that question. Yeah, your previous guest talked about it. I think theres a lot of focus on the fed and what theyre going to do. We expect them to raise rates in the middle of the year. But at the end of the year it might be 50 75 basis points. Theres an interesting statistic, the market has been predicting rate rises for the last five years. For us that shouldnt be the only focus. Theres a lot more things to work with. Within the elements you invest in what do you think is going to do best moving forward . Well certainly the last 12 months munis was the place to be. Going forward we think munis are beginning to look a little bit richer. Youre seeing supply of munis increase, first time in seven years that net supply is going to be positive in the muni world whilst Corporate Credit has cheapened up. Even on an aftertax basis in some sectors like energy it makes sense to take an interest in that sector. If youre taking advantage of these crazy oil moves weve seen and the cornage within the Corporate Bond market how do you pick a high quality credit in that environment . We use the resources we have internally. We have to call all the different people involved in the Energy Sector from the equity guys the high yield guys. The resounding conclusion was that the most likely winners will be the high quality Investment Grade names with access to capital. So weve seen all the bonds and the bondlike stocks kind of moving and doing extremely well recently because weve had rates plunging. I mean in essence why do you think that is . Why are rates so low . Is it about the economys being so bad . I think rates here are certainly impacted by what is happening in the rest of the world. The front end may well be policy dominated. The longer end you have pension plans, you have overseas investors. Theres 9. 7 trillion of Central Bank Balance sheet thats got to go somewhere. Question on munis. I know they had a great year last year. I think they almost actually outperformed stocks, the s p 500 in terms of returns. This year there was some concern that there would be too much issuance, too much supply. Do you see that . I think thats certainly a concern. We think that the seasonals will have a bigger impact this year when suecoupon flows come in january and june. There may be volatility before that. The one comment about the fed, the real opportunity in the muni market was in 13 with the taper tantrum in the muni market. Thats clearly going to be a risk for this year. We want to have a balanced kind of exposure to both credit and municipals. Unless of course as was said yesterday they actually dont raise rates until 2016. Well, yeah. Would you subscribe to that . Our house view isnt that. Certainly the risk the danger of forecasting Interest Rates, its a bit of a tricky game even if youre a central banker. Even if youre a central banker. Good to see you, andy. Thank you very much. By the way, the major averages have just turned positive after the dow was down as much as 100 points earlier. Now the dow in positive territory as we march toward the close. Thats a sharp move on the dow. I imagine something may have triggered that. We probably climbed 40 or 50 appointments within a few minutes. And the s p and nasdaq both positive. Much more to come on the closing bell as we await the president who is set to take the podium. First, lets get to sue herera with a cnbc Business News update. Sue . Thank you so much simon. Here is whats happening at this hour. The captain of the Costa Concordia has been sentenced to 16 years in prison for causing that fatal shipwreck. 32 people were killed when the cruise ship crashed in 2012. The house is expected to begin voting next hour on the Senate Approved Keystone Pipeline legislation. It is expected to pass but the president has vowed to veto it. It takes a twothirds vote by both houses to override a president ial veto. And we are waiting for the president to speak regarding his request to congress to authorize the use of military force against isis. It is expected any moment now and when it happens, you can see it right here on cnbc. Meantime coming up on fast money, Michael Burns will discuss the companys new stock agreement with john malone and stars. More closing bell in just a couple minutes. Have you heard of the new dialing procedure for for the 415 and 628 area codes . No what is it . Starting february 21, 2015 if you have a 415 or 628 number youll need to dial. 1 plus the area code plus the phone number for all calls. Okay, but what if i have a 415 number, and im calling a 415 number . Youll still need to dial. 1 plus the area code plus the phone number. So when in doubt, dial it out still awaiting the president. Theres your live shot inside the white house where he is set to speak any minute now, simon on the threat of isis and what the u. S. Is going to do about it and what he is asking congress to do about it authorize another attack. In the meantime though were keeping an eye on the markets. Its quite interesting. Whats happening at the moment appears to be on the s p 500. The dow is going in and out of negative territory. The s p keeps trying to make a run at 2,068, and it keeps failing and falling back bringing the whole market down. We have probably done that four or five times now on the session overall. We just cant inch higher though we are about five points higher than the top of the range weve had more recently. Watching in terms of the major groups it looks like we have utilities at the bottom of the group as we have seen along with energy as we have seen the price of crude oil slip. On top, Consumer Staples and information technology. Lets bring in cnbc contributor middle east expert David Phillips as we await the president with the twominute warning. What are you expecting the president to say as this has become very political what hes asking congress to do . Hes going to state the apparent, which is isis is a threat. The u. S. Needs to respond. If we had any hope of degrading and destroying the Islamic State fighters, were going to need more than just air attacks. For the u. S. To consider boots on the ground the white house is going to need congressional authorization. My understanding is that hes very anxious to limit the view that this will be significant boots on the ground not the least for his own party, mr. Phillips. That goes without saying. The administration has maintained all along no u. S. Troops, but the moment that we start intensifying our efforts against isis its a slippery slope. Were going to need more special forces to complement kurds and other iraqis who are fighting the Islamic State. Its inevitable we will have more u. S. Troops on the ground in iraq and syria. So lets assume he gets this through congress. How will that change what happens given that were now six months into the campaign anyway. Forgive me, we have the president about to speak. Good afternoon. Today as part of an International Coalition of some 60 nations including arab countries, our men and women in uniform continue to fight against isil in iraq and in syria. More than 2,000 Coalition Air strikes have pounded these terrorists. Were disrupting their command and control and supply lines, making it harder for them to move. Were destroying their fighting positions, their tanks, their vehicles, their barracks their training camps, and the oil and gas facilities and infrastructure that fund their operations. Were taking out their commanders, their fighters, and their leaders. In iraq local forces have largely held the line and in some places have pushed isil back. In syria isil failed in its major push to take the town of kobani losing countless fighters in the process. Fighters who will never again threaten innocent civilians. Weve seen reports of sinking morale among isil fighters as they see the futility of their cause. Make no mistake, this is a difficult mission, and it will remain difficult for some time. Its going to take time to dislodge these terrorists, especially from urban areas. But our coalition is on the offensive. Isil is on the defensive, and isil is going to lose. The barbaric murders of so many people, including american hostages, are a desperate and revolting attempt to strike fear in the hearts of people it can never win over by its ideas and ideology because it offers nothing but misery and death and destruction. With vial groups like this there is only one option we are going to degrade and ultimately destroy this terrorist group. When i announced our strategy against isil in september, i said that we are strongest as a nation when the president and Congress Work together. Today my administration submitted a draft resolution to congress to authorize the use of force against isil. I want to be very clear about what it does and what it does not do. Of this resolution reflects our core objective, to destroy isil. It supports the comprehensive strategy we have been pursuing. A systemic and sustained campaign of air strikes against isil, support and training for local forces on the ground including the moderate syrian opposition, preventing isil attacks in the region and beyond including by foreign terrorist fighters who try to threaten our countries. Regional and International Support for an inclusive Iraqi Government that unites the iraqi people and strengthens iraqi forces against isil. Humanitarian assistance for the innocent civilians of iraq and syria who are suffering so terribly under isils reign of horror. I want to thank Vice President biden, secretaries kerry and hagel, and general Marty Dempsey for their leadership in advancing our strategy. As we meet this challenge in iraq and syria, we all agree one of our weapons against terrorists like isil a critical part of our strategy is the values we live here at home. One of the best antidotes to the hateful ideologies that try to recruit and radicalize people to violent extremism is our own example as a diverse and Tolerant Society that welcomes the contributions of all people including people of all faiths. The resolution weve submitted today does not call for the deployment of u. S. Ground combat forces to iraq or syria. It is not the authorization of another ground war like afghanistan or iraq. The 2600 american troops in iraq today largely serve on bases, and, yes, they face the risk that is come with service in any dangerous environment, but they do not have a combat mission. They are focused on training iraqi forces including kurdish forces. As i have said before im convinced that the United States should not get dragged back into another prolonged ground war in the middle east. Thats not in our National Security interest and its not necessary for us to defeat isil. Local forces on the ground who know their countries best are best positioned to take the ground fight to isil and thats what theyre doing. At the same time this resolution strikes the Necessary Balance by giving us the flexibility we need for unforeseen circumstances. For example, if we had actionable intelligence about a gathering of isil leaders and our partners didnt have the capacity to get them i would be prepared to order our special forces to take action because i will not allow these terrorists to have a safe haven. So we need flexibility, but we also have to be careful and deliberate, and theres no heavier decision than asking our men and women in uniform to risk their lives on our behalf. As commander in chief i will only send our troops into harms way when it is absolutely necessary for our National Security. Finally, this resolution repeals the 2002 authorization of force for the invasion of iraq and limits this new authorization to three years. I do not believe americas interests are served by endless war or by remaining on a perpetual war footing. As a nation, we need to ask the difficult and necessary questions about when why, and how we use military force. After all, it is our troops who bear the costs of our decisions, and we owe them a Clear Strategy and the support they need to get the job done. So this resolution will give our armed forces and our coalition the continuity we need for the next three years. It is not a time table. It is not announcing that the mission is completed at any given period. What it is saying is that congress should revisit the issue at the beginning of the next president s term. Its conceivable that the mission is completed earlier. Its conceivable that after deliberation, debate and evaluation, that there are additional tasks to be carried out in this area and the peoples representatives with a new president should be able to have that discussion. In closing, i want to say in crafting this resolution we have consulted with and listened to both republicans and democrats in congress. Weve made a sincere effort to address difficult issues that weve discussed together. In the days and weeks ahead, well continue to work closely with leaders and members of congress on both sides of the aisle. I believe this resolution can grow stronger with the thoughtful debate this moment demands. Im optimistic it can win strong bipartisan support and we can show our troops and the world that americans are united in this mission. Today our men and women in uniform continue the fight against isil and we salute them for their courageous service. We pray for their safety. We stand with their families who miss them and who are sacrificing here at home. But know this, our coalition is strong. Our cause is just, and our mission will succeed. And long after the terrorists we face today are destroyed and forgotten, america will continue to stand free and tall and strong. May god bless our troops and may god bless the United States of america. Thank you very much, everybody. And so the president explaining his request to Congress Today for a new threeyear authorization for the use of force against Islamic State. It doesnt involve largescale boots on the ground he says. It wont involve a ground war, though he would allow special forces in. Lets brickng in john harwood. As the president said he doesnt have this is the beginning of a negotiation. There are those like Speaker Boehner who believes it doesnt actually go far enough. Is it a done deal . No its not a done deal. In fact, its going to take a while, weeks or maybe months to finish this. A lot of negotiation. There will be some hairy moments along the way, but i think eventually the president will get the authority that hes seeking today for a simple reason. Republicans control the congress. Theyve been urging him to take the fight against the Islamic State, and its not tenable for them to block it at least a Critical Mass of republicans. And on the democratic side there will be many democratic opponents to this people who think it hasnt tied the president s hands enough but ultimately there are going to be enough democrats who are not willing to undercut their own partys commander in chief that this is eventually going to pass both houses. You know what . Lets bring back cnbc contributor middle east expert David Phillips into this conversation. David, with your expertise on the region on the Islamic State, on the threat it poses, is this president ial solution for now enough to fight isis or isil as the president calls it . Its a big step forward, but there are two fundamental flaws in the approach. I was just in Iraqi Kurdistan and the peshmerga say they are not receiving the right weapons from the United States. Were giving them guns and bullets but not the heavy weaponingsweapon weapons they need to counter the heavy armor isil seized. The second flaw is the idea of a unified iraq as part of the response. We need to face the fact that iraq is a failed state, and as long as we somehow condition our support to iraqis on the presumption that theyre going to get together and find some reconciliation, were not simply going to be able to move forward. We need to know who our friends are in iraq. Those are the iraqi kurds. We need to support them more fully and we need a steelyeyed assessment of the politics on the ground. Just to give us a political view on that if you would, or political analysis of whats being said there by david, arming the kurds and where that would leave the president. Obviously, he would prefer that the kurds didnt go off and attack other people i guess is the point here. Sure. And i think its fascinateing that the debate has reached this discussion. Remember that a partition of iraq was what joe biden, now the Vice President talked about during the run up to the 2008 campaign. A lot of people ridiculed him for being sort of way out there and unrealistic with that kind of approach but given whats happened in iraq that issue is back on the table. I dont know if thats going to be the longrun solution. I think we cant fail to note the drama really of whats going on today because this is a president who, of course rose to prominence initially by opposing the iraq war. Now seeking not just the buyin and the imprimatur of the Republican Congress for military action but it will put his own stamp on that military action. It will make it in a way more than he is right now, going to make him the owner of this conflict and that puts burdens on him that i think he never imagined he would be assuming. Yeah. No doubt about it. All right thank you for now, john harwood, outside the white house and, of course to our cnbc contributor David Phillips for weighing in. 11 minutes to trade on the session. Weve cut a lot of losses during the course of the session and still trying to break higher towards what would be highs of the year. About 1 below the record alltime high on the s p. A storm of earnings heading our way. Cisco, metlife, and tesla among the biggies. We will deliver their numbers as soon as they hit the tape for you with instant analysis. Your moms got your back. Your friends have your back. Your dogs definitely got your back. But whos got your back when you need legal help . We do. Were legalzoom, and over the last 10 years, weve helped millions of people protect their families and run their businesses. We have the right people onhand to answer your questions backed by a trusted network of attorneys. So visit us today for legal help you can count on. Legalzoom. Legal help is here. lowe hi. Im rob lowe. And i have directv. hs lowe and im peaked in high school rob lowe. And i have cable. lowe directv is wireless, so you can put your tvs anywhere without having to look at those ugly wires and boxes in every room. hs lowe cable isnt wireless but you just gotta put something in front of them. lowe im still in awe of how great my tvs look. hs lowe and im still captain of the team. lowe dont be like this me. Get rid of cable and upgrade to directv. Call 1800directv. Moments until we close trade here. Were down 32 points on the dow. Art cashin fromu ubs told me as we put it pared for the close. Lets bring in Frank Braddock of jhs Capital Advisers and our own bob pisani. Were short on time so just a minute each. The important thing is were waiting on whats going on in brussels. The eurozone finance minister is meeting with the new greek finance minister. They should be out with a declaration. We were hopeful it would be before the market closes. Theres been nothing. Theres peace talks going on in minsk about ukraine. It looks like were down 30 points on the dow. We havent gone two days backtoback without triple digit moves on the dow. This would be one but so far in 2015, volatility is the name of the game. And folks really shouldnt be surprised about that. If you sit and look at the vix, were exactly where we should be. Were back to normal. In the last year were down around 10 now up around 19. No big surprise approximates. This has enabled a lot of traders to get long and short the markets very quickly. You play the trend. Oil stocks one day up one day down. A lot of people are doing very very trading the stocks. The problem is theres still not a longterm trend. Are markets taking their cue or any asset class . It seems were breaking some of the correlations. When the dollars stops going up and oil stops going down and bond yields stop going down when that stopped at the end of the january, thats when the market stabilized. We have to take a quick break. Well be back shortly with the closing countdown on closing bell. And brace yourself for a flood of earnings right after the bell. Tesla, whole foods among the big names well be watching. Youre watching cnbc, first in business worldwide. Or stop to find a bathroom . Cialis for daily use is approved to treat both erectile dysfunction and the urinary symptoms of bph, like needing to go frequently, day or night. Tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. Do not take cialis if you take nitrates for chest pain as it may cause an unsafe drop in blood pressure. Do not drink alcohol in excess. Side effects may include headache, upset stomach, delayed backache or muscle ache. To avoid longterm injury, get medical help right away for an erection lasting more than four hours. 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. What makes it an suv is what you can get into it. What makes it an nx is what you can get out of it. Introducing the firstever lexus nx turbo and hybrid. Once you go beyond utility theres no going back. Kid hey dad, who was that man . Dad hes our broker. He helps looks after all our money. Kid do you pay him . Dad of course. Kid how much . Dad i dont know exactly. Kid what if youre not happy . Does he have to pay you back . Dad nope. Kid why not . Dad it doesnt work that way. Kid why not . Vo are you asking enough questions about the way your wealth is managed . Wealth management at Charles Schwab oil was a big mover err again today. We moved in a fivepoint trading range. Lets take a look at the chart. We were as low as almost 48. That was right after the market opened and we went almost even on the day up to 50. Were, again were routinely moving in these 5 ranges and we had a big move to the downside and that was on the weekly inventory numbers that came out in the middle of the day but it bounced back once we got the numbers. Can you put me up a chart of the s p 500. I want to demonstrate where were brownsingouncing. Were at 2067. Were five points higher from the tops that weve had so far this year. But still unable to break substantially to the upside. Can we do this . I think were going higher. Were going to have volatility. Were going to have spikes but the market at the end of the day will head higher. The internals are good. Why will it go higher . I think folks want it to go higher and really right now we have syria, we have the whole thing in greece, the whole thing in ukraine. Folks are getting numb getting tired of it not paying attention to it anymore. 73 of the s p beating on earnings. And here is whats important about this chart. Here is where we started bottoming and this is when bond yields stopped dropping so much. We saw oil starting moving into a trading range, and we saw some other things including europe start to stabilize. When those things happen the market calms down. A lot of people a lot of really respected analysts are still saying oil hasnt bottomed and we may not bottom until well after the summer. Can we rally if oil doesnt stabilize. It will be difficult it Oil Moves Back below the level. 45 is the level. Thats a lower level that oil has established. Its now in a trading range between 45 and the low 50s. As long as it stays there, i think the market will be all right. Later in the year most traders feel oil will be higher. There is a delay in terms of gasoline. Yeah. What were seeing now is dramatic cuts in capital expenditures. I think the important thing here is the market is responding very very quickly. The great thing about the shale plays is they can shut down production really fast. A lot faster than other production around the world. U. S. Shale plays very dynamic. Turn it on turn it off really fast. Frank, if i was to give you 1,000 to invest for five years, where would you put it . Frontier markets, not the u. S. And not traditional emerging markets. Smaller countries growing faster. Lots of excitement. Also lots of problems. Middle eastern banks. No question but you have a small correlation between these countries. Okay. There we go. The bells are ringing. Frank, bob, thank you. The closing bell continues with sara and simon. In today for kelly evans. Sim mon simon hobbs will be back on set in a moment. Were talking dow component cisco as well as tesla and, of course, whole foods. Here is how were finishing the day up on wall street. It was a choppy one today. The dow ending the day pretty much flat. Down less than ten points. The s p 500 also unchanged on the day. The nasdaq an outperformer throughout the day. Apple going higher and the nasdaq finishing the day up 0. 3 . Lets get straight to it with todays panel. Stephanie link Nathan Bachrach from simply money. Our own kate kelly and fast money trader guy adami from the nasdaq. So guy, this was a choppy day and it turns out we ended with barely a move on the dow and the s p 500. Are you worried about greece . I think you have to be. If youre not worried about it i think youre just burying your head in the sand because if things go pear shaped there, you have the trickle down with portugal and italy. So, yeah i think you have to be worried, but, you know, you have to also respect the resilience of the Broader Market. The s p had every opportunity to sell off today, didnt do it rallied back to unchanged. It was positive a little portion of the day. What im most encouraged by and most impressed with is the continued resilience of the Broader Market. Yeah. Nathan, the resilience of the Broader Market. Its a good point, had the opportunity to sell off on lack of headlines or a deal. We stayed in there. Is it corporate earnings . I think what it is is confidence in america and we look at the rest of the world and we go im okay. You im not so sure about. Weve been able to get rid of the noise. I think this morning when the head of Deutsche Bank came on squawk box and said we have a lot less risk in the Banking System to greek debt theyre starting to set the table to say, if things dont go the way we want i think well be okay. Interest rates i believe are still whats driving everybody. I wish janet yellen would just say, you know something . Im raising the rates and were done with it. Just as we saw with qe the tapering of qe were worrying about it. Just get it out of the system. Just get it done with already and rates are not going up terribly high. Stephanie, what do i buy . Whats good value here . I think you use kind of the choppiness of the market to buy good earnings. Companies that have reported but they fall on a Headline News from greece. So look at pepsi, organic growth of 5 . Look at mondelez guiding for double digit earnings. 80 international really getting hurt by the currencies. But offset by lower commodity costs and restructuring. Go back to starbucks. Reported a very good number. Look at some of the banks that have fallen off now that the 10year has stabilized. I like morgan stanley, Goldman Sachs. Theyre talking about better trading activity in the most recent weeks. I think you can look at specific companies, stories. When the headline hits them thats where you go. I think to some extent were seeing a continuation of trends that have been choppy but ongoing for a while. For example, you saw today that junk bonds are seeing inflows. People are still searching for yields. Yields are higher than they were in june. Theres still an idea that we cant get any yield out of the developed country bonds so we have to go elsewhere for it even if theres a lot of trouble in the energy patch. In terms of greece clearly theres a lot of legitimate concern. I was looking at dan loebs latest third point hedge doesnt letter. He tends to be an interesting observer, has a greek fund. Hes basically constructive. He thinks the germany has the motivation to make a deal with greece as long as theres some reasonable alternative to austerity. A greek fund of what . He invests in greek bonds. I guess provided they stay in, they get bought by the ecb in two months time. I think stephanie makes a good point. You look to market leadership. If the yield curve is going to steepen again, the financials look interesting. A name like blackstone people dont talk about. They reported a pretty solid quarter. Is that stock recently made alltime highs. I think big cap pharma still works. Look how pfizer has rallied. They announced a 5 billion accelerated program. A bit of good news. Pfizer works. I like the biotechs although they have gotten beaten up a little bit on some marginally bad news. I think somebody was trying to get out of the space entirely. There are single stocks that work and those stories have been impervious to what has been a choppy tape. Were getting whole foods earnings. Courtney reagan has those results for us. Courtney . Thats right, sara. Whole foods turning in their First Quarter earnings. 36 cents. That is a penny better than what analysts were expecting on revenue of 4. 67 billion, exactly in line with what wall street was looking for. Whole foods also reiterating 2015 guidance, this again for the First Quarter. Sara, back to you. Looks like thats positive reaction in terms of the after hours, stephanie link. You dont own whole foods, correct . No, but we have in the past. Its turning around. It is turning around. I think the expectations are very low. I think theyre seeing some tailwinds from lower oil. They have done some Company Specific things. Theyve lowered prices. And i think theyre now more competitive because we have been seeing competition from the krogers of the world but i think expectations were so low for this name that just an in line report is good news. You mentioned theyre going to have to get a new nickname. Theyre still called whole paycheck out in the midwest. Thats the reputation. Kroger is in the space, theyre growing revenue at 10 . Theyre growing profit at 18 . Theyre getting the same multiple and you look at kroger if you had a chance between buying one or the other, i will go with kroger over whole foods. Although it has been going up and up. We just got cisco quarterbackly results. Jon fortt has those. Well it looks like a beat on the top and bottom lines. Revenue came in at 11. 94 billion. The street was looking for 11. 8 billion. Eps nongap came in at 53 cents. The street was looking for 51 cents, and gross margin came in at 61. 7 . Cisco had guided to a range of 61 to 62 . The street was hoping for 61. 9 so thats just about in line. Should also mention repurchase stock repurchases were 1. 2 billion in the quarter. A little bit lower than in prior quarters, but then again the stock has appreciated quite a bit lately. Also the dividend is up 2 cents to 21 cents. They did all that in the quarter. So overall looks like a decent quarter but guidance comes on the call so expect a lot more action then sara. Interesting. Jon, stay with us for more on ciscos earnings. Lets bring in daniel ives. Youre absorbing this as everybody else does. What are your initial thoughts . I think its a stark contrast to what weve seen in large cap tech with the softness out of microsoft, ibm and s. A. P. At this point with a lot of these traditional stalwarts in tech, its about a race to the cloud. Theyre all trying to transform with cisco, ibm, microsoft, among others. Thats what investors are focused on. Which of these large cap tech names will be able to successfully make the leap into 2015 on cloud, and that could be through organic as well as through acquisitions and Cyber Security, big data as well as cloud. Dan i have a question for you. When does this stock really going to trade on those Growth Initiatives as you mentioned, data center collaboration, security versus the switching and the router business which everyone seems to be fixated on given that the margins have been under pressure in those two segments . I think this is really what a lot of large cap tech investors sure the conundrum they face is youre looking at the next jen trendsgen trends. As investors feel like theyve started to cross the chasm, thats where i think you see more of the multiple and valuation, a lot of these large cap tech names get the respect as they go to the next gen trends. I think its still prove me stories across large cap tech but this is for investors a contrast to what we saw with ibm and microsoft. I think investors feel good going into sort of post earnings season, the outlook into 2015. Leaves some hopes for optimism. And theyre raising their quarterly dividend. As a shareholder you like that. And they have easy comparisons to the next upcoming quarter. The stock really does trade though on guidance guys. So we have to get do you like it . We own it we like it and we like it because i do think eventually we are going to get that appreciation and maybe a rerating as people do focus on the cloud and on security. Security right now is about 23 of total revenue. So if that really kicks in as well as the next generation switches, i think that bodes well for the story and the stock is still very attractive. At the end of the day you look at the large necktologyTechnology Stocks and you have to ask a question do i buy technology or buy individual issues. In this case you have to say to yourself theyre really going to get into the cloud and get momentum and im not sure i see that even though i love John Chambers and cisco. Jon fortt, what do you have . Something else i should mention, not specifically in this release but having to do with the cloud. A new threat to cisco. Facebook coming out today saying they have designed even further a piece of networking equipment. The reason why this is important is what facebook tends to do its done to some extent with servers and now also with networking equipment, is they design this equipment for their own huge data centers and then they allow these blueprints to be used for free by anybody who wants to use them. Microsoft, facebook the likes of apple, google and others are huge customers now in this cloud era and there are certain areas theyre choosing to come mod advertise. You might hear questions from anesthetists to cisco about players now like facebook coming in with their own designs threatening to come momd advertise a high margin business. Will that be your foremost question . I think jon hit the nail on the head. Theres a convergence across the data center with Cyber Security with next Gen Data Center and investors are really starting to look into 2015 and trying to understand which path this is going to take across this next Gen Data Center. Who is going to be successful as well as how fast this convergence is happening, especially in Cyber Security and networking. Thats a key theme tech investors are focused on. You have to big Cyber Security guy, fire eye reporting tonight as well. Thats a big theme in tech for 15. I want to ask you, guy, from a traders perspective, are you a buyer . It looks like a positive reaction. The stock is up 20 over the past year more than 9 over the past 3 months. Do you like this mega cap tech infrastructure. You know, what i found interesting was last quarter. Stephanie can speak to this. I didnt think it was a great quarter but the stock reacted really well, and to her point now, you got to wait and hear what the cats have to say because this thing moves a lot. With that said its not expensive. I dont think there are better beta plays if you want to go into Cyber Security which is what i heard you folks talking about. Names Like Palo Alto Networks has been a monster. If youre looking for beta, i think they will provide you with that. On the stock in particular when John Chambers used to give guidance, he could move the entire stock market two or three years ago. Is that still the case . Maybe not as much. I think his credibility has been kind of hit over the years, but i think the company is back on track, and this is kind of a like a turnaround for cisco specific. This is them figuring out what the Growth Drivers are, what the end market is where they want to be. Trying to position themselves to see margin stabilization in some of the more commoditylike businesses. I think theyre doing a really good job. The last couple quarters have shown theyre executing better. So its encouraging. To guys point on the security companies, fire eye just reported a very good number. Thats a really great story there, and i think thats if you really do want security you want to go to the peer plays. Stephanie, guys thank you very much. Well be back shortly. Teslas earnings supposed to be out about now, but ceo elon musk delaying that until the top of the hour due to the spacex rocket launch. Its good to be the boss i guess. Well take a closer look at tesla next. Will the numbers now turn it around . And oil touching a new record with supply reaching an 80year high. Were talking about ibnventories. Where is oil headed . Well try to figure it out. Youre watching cnbc, first in business worldwide. Well try to figure it out. Female announcer get 36 months interestfree financing, and save up to 300 on beautyrest and posturepedic. Even get three years interestfree financing on tempurpedic. And of course, free sameday delivery. But only through president s day at sleep train. We were just talking about Cyber Security stocks. Lets send it other to kate rogers for a quick earns alerted on fire eye. Beating Fourth Quarter estimates reporting a loss of 38 cents a share. Thats compared to estimates of 49 cents. Revenue copping in at 149 million versus estimates of 149 million. The stock taking a sharp dive on the results then rebounding 6 . Its currently trading up 5. 5 on heavy volume. Lots of earnings. And simon, teslas Quarterly Results would have normally come out but elon musk moved them to the top of the next hour. These earnings getting a lot of attention as the stock has been under some pressure for the last few months. Lets double back on fire eye because stephanie link you had seen those results, you already reacting to them as being good. Is this its a great story. Cyber security is a really powerful thing for 2015. And weve all been talking about it for the last several months but i think this company is starting to deliver more consistently. Its been up and down but i like their guidance. I think theyre in the sweet spot. I expect to see m a in the space. And a presue ofview of what we can expect when elon musk gives us the results. Are you a buyer . No were not. At best we are a holder of the stock. I think expectations are a little too high when you look at it compared to the rest of the market. Lets face it, a couple months ago elon musk told us the company is overvalued. I think 2015 will be a year of struggles. Looking forward, margins are coming down revenues have been coming down on a yearoveryear basis. The sweet spot for this company in terms of growth i think has passed and theyre starting to find out how tough it is to compete. Even elon musk himself said last year he thought his stocks valuations were getting a little sky high a little too much but just curious, how would you size up the competition from some other luxury carmakers that want to compete with teslas electronic vehicle . Electric vehicle rather. Are they posing real threats . Is it just the sheer number of competitors that are getting in the space or how would you assess that in terms of looking at the year to come . Im sorry, that question is to me . Yes. To carson sorry. Go ahead. Carter why dont you answer that question from kate kelly. How do you sum up the competition and where it leaves elon musk . I think its still pretty early on to size up truly who the competitors are. Bmw clearly with the i3 and the i7. Audi will come out with a couple models. I have had the question posed to me if the bolt is a true competing vehicle. I think once you see the model 3 come out i would be more concerned about competition. Right now theyre in the sweet spot. Model s is still selling steadily. The key for me is the model s. Does it remain on track for a production ramp thats commensurate with the expectations out there today. I agree the next couple quarters it will be a little bit hazy in terms of what the next catalyst is but if the model x remains on track, i think thats the next major catalyst. Carter can they get to 50 Production Growth for 2015 in your view . Oh, yes. Even with the hiccup in china, very publicly elon musk is disappointed with the start in china. He said on last quarter, if we dont tell one vehicle in china, we can grow 50 year on year. We have a personality in musk and we have a gig ga factory and they also happen to make cars and who cares. 25 of the cars they sell. That person also owns a toyota. You want a conservative approach go buy a toyota stock and leave it at that. But other than the gig ga factory, tell me long term where this place goes. You also got to nathan, let mebuild on that. You just made the comparison between whole foods and kroger. I think the exact same thing is going on here with tesla and the other automakers. You know the whole paycheck idea. Tesla at some point will get out of the niche market and they will have to get down and dirty and compete with toyota. Theyre going to come out and other Car Companies are going to expand. Im right with you there. Outside of the giga factory what else is there. The bull case is its the battery and the battery kansas city power other cars and make deals like they have been making with bwm and others and then they will make them more efficiently in the giga factory. Why are you not convinced of that . You think the other carmakers will go at it alone . Lets not i think the other carmakers will go at it along. Chris, go ahead. I think the other carmakers will go at it alone. I think there are other alternatives. We need to look at c and g market. North of cincinnati weve now got a cng depot there. Ford has come out, mercedesbenz has come out and said we think this is an interesting alternative. Cng meaning come presscompressed natural gas . Yes. I know its abundant and relatively cheap in the u. S. Especially after this winter that was colder much later than expected so now we have such oversupply, arent we years away from having the infrastructure to really make that work . You got to love the idea from an environmental perspective, but still. I think you will see it let me jump in there for a second much faster. The electric im sorry. Go ahead, carter. I was going to give carter the last word. You have been trying to get in. Natural gas is i think from the trucking perspective makes a lot more sense. With light duty vehicles, you must have dramatically much better infrastructure. Id be more concerned about people who had a much more protracted approach like bmw, like daimler. I think they have a two to three year lead on Technology Battery costs, the range perspective and the wow factor. I think that has a lot of legs. All right. Well leave it there as we await the results. Gentlemen, thank you very much. Thank you. Meantime Oil Continues to confound. After a brief rebound, Oil Prices Falling again below 50 a barrel on wti after u. S. Stockpiles hit new record highs. Could those calls earlier this week for 20 oil be actually correct . Well talk about it next. And he was instrumental in wiping out General Motors bondholders during the automotive makers governmentbacked bankruptcy. Now this guy harry wilson is an activist investor who wants gm to buy back 8 billion of its own stock. But is he doing it to help gm shareholders or the United Autoworkers Union . Some here have a very different take. And if you think this looks like a holocaust uniform, youre not alone. Why is one major retailer calling this item which some are calling deeply offensive . That story is later on the closing bell. You total your brand new car. Nobodys hurt,but there will still be pain. It comes when your Insurance Company says theyll only pay threequarters of what it takes to replace it. What are you supposed to do, drive threequarters of a car . Now if you had a Liberty Mutual new car replacement, youd get your whole car back. I guess they dont want you driving around on three wheels. Smart. 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We enable you to reach Global Markets and drive forward with broader possibilities. Cme group how the world advances. Lets send it over to kate rogers for another earnings alert on a busy afternoon. Thats right, sara. Zhuo lili missing on the top and bottom line this afternoon. Earnings coppingming in at 11 cents versus the estimates of 14 cents. Revenue reported at 391 million versus estimates of 407 million. The online retailers shares getting crushed in the afterhours. They were down more than 20 initially. They are down 16 right now. Zhuoulily also issuing light guidance for the First Quarter and the full year as well. Back over to you guys. Okay. Thank you very much. Crude oil falling, down more than 2 on the day back below 50 a barrel with gas prices on the rise. Will this slow their climb higher . Joining us now to discuss, jef kilburg, kevin oleary of shark tank along with the closing bell panel. Jeff curry, the chief commodities analyst at Goldman Sachs threw out a three handle. He had said essentially his target was in the low 40 range. This is a target they dropped by a huge margin just in january from like 80 to 40 for the Second Quarter. Hes still saying hes looking at about 40 in august. He thinks the oversupply issues we have really around the world but particularly in the u. S. Are going to persist for another 6 to 12 months but he said today sara, he thinks we could see 35, high 30s in that period of time while we continue to work out the supply issues. Jeff what happened today . Well shortterm i think to goldmans point, we are seeing crude levelinventoryies rise. The highest level we have seen in 80 years at this time of year. We feel like the momentum is going lower but volatility will persist. Were seeing 4 5 movement in the crude oil space. One is there was all this thinking going into the opec meeting, would they cut their production quota which was 30 Million Barrels a day. As it turns out not only did they not cut it which sent oil way lower in domestic and overseas market theyre actually producing at 30 million and change right now which they recently reported. The other thing is and this came up with curry but also other people recently is that the rig count, even though its way down its down like 18 yearoveryear according to baker hughes were not seeing a slowdown in production because the nature of the rig cancellations is such that the highly productive wells are still going. What happens when you pour oil in a shark tank kevin. Whats your view here . I think what happens over the next 60 days is were going to find out to an interesting question what is the value of an incremental barrel of oil where theres nowhere to store it . Is it zero . Because if you bring oil out of the ground and you physically have nowhere to put it no container ships, no physical inventory unless you build more were going to find that out when we get to 7 Million Barrels which will happen in the next 60 days. So if youre in the camp that says the increment barrel is worthless if you cant store it, youre going to see that price sometime in the next two months, and that could have a three handle on it a low four, but all of this optimism about rig count down from 1600 to 1200 maybe it goes to 1,000, it doesnt matter. The production keeps rising and theres just more oil to put to storage. Nowhere to put it. To kevins point im bearish. Youre right. You are bearish, kevin. Talk about the rig count being mitigated by supply. When you see the job owning by opec and that doesnt have any effect. Kev is right, chomp, chomp from chicago. Jeff how much higher can inventories go at this point . I think that number today was a surprise to even those that were expecting these high inventories. Sara youre right. Exactly. Its going to go to 7 Million Barrels. What did you say, kevin . Its going to go to 7 million and there will be nowhere to put it. You will be awash in oil. It will be free oil by the cup anywhere you want it. Kevin, i think youre raising a key point. The oversupply that we are projected to have by later this year, i think its 400 Million Barrels, something of that nature is about what we have in terms of available storage. So you take andy hall the respected oil trader he said recently its a coin toss whether well have enough storage or not. Obviously if we run out, youre talking about cheap oil from there. Just hang on a minute. If we and a lot of the people that you speak to have been storing oil, thats been the deal, thats what theyre doing. If you then have no more room to store the oil, the price of oil falls, what happens to what is in storage, jeff . Presumably that too falls. What happens . Does this become like a cumulative kind of overspill . It does. But right now the future structure is allowing that trade. You are allowed to go out farther down the road and store that but youre write, to kevins point, when we run out of that storage, it will cost a lot of money to bring the storage vehicles overseas. Right now the supply puts Everything Else to rest. We are seeing 38 oil and the research we do in the short term but right now the supply cant be mitigated by any other rig count, opec job owning. Theres nothing that stops the supply which to kevins point is gushing out of the ground. In the whole conversation the consumer is going really . I like that. Its getting cheaper at the pump. Americans dont budget. We have surveyed them. Eventually it will leach into the question. It will be good things for the consumer and were going to have to trade off cheaper gas prices and what it does to the Energy Sector and to bonds that have been issued backed by the Energy Sector with what its doing for the consumer and the stocks that theyre spending their buying. This is why i highlighted pepsi and mondelez. Consumer, auto parts. I think you can own a lot of specialty retailers. I think theres a lot of momentum still in this sector and i think and the pepsi cfo told us today it sometimes takes a few months lag. Six months. I was going to ask about that because havent we seen so far people are paying down debt or saving money . When do we expect the extra Howard Schultz at 125rstarbucks said they havent seen it yet and he doesnt expect it until the Second Quarter or second half of the year. Five months. Its a lagging effect. And the hedges too. We havent seen qe start in europe. Thats a good point. Weve to leave it there. Were not going to mention the d word. Jeff, kevin, always good to see you both. Coming up which retailer is selling this item which looks shockingly like the uniform holocaust prisoners were required to wear . That sounds like a disaster for the company, but that story is coming up next. First, sue herera has a news update. Hi, sue. Hi simon. Here is whats happening at this hour. President obama says it will be a difficult mission, but he is asking congress to authorize the use of military force to defeat Islamic State forces in the middle east. Mr. Obamas request does not involve deployment of ground forces. However, the president says he could deploy special forces if the u. S. Had what he calls actionable intelligence about the location of isis leaders. The spacex launch of a deep space observatory is a go but the company has scrapped the attempt to land the booster rocket on a platform in the ocean. Rough seas are to plame. Kb said it received almost 1500 orders in the quarter 2345 ended last woke. Coming up ciscos ceo John Chambers at 6 00 p. M. Eastern time. More closing bell after a quick break. Y are we so committed to keeping you connected . Why combine performance with a conscience . Why innovate for a future without accidents . Why do any of it . Why do all of it . Because if it matters to you its everything to us. The xc60 crossover. From volvo. Lease the wellequipped volvo xc60 today. Visit your local volvo showroom for details. Know that chasing performance can mean lower returns and fewer choices in retirement. Know that proper allocation could help increase returns so you can enjoy that second home sooner. Know the right Financial Planning can help you save for college and retirement. Know where you stand with pnc total insight. A new investing and Banking Experience with personalized guidance and online tools. Visit a branch, call or go online today. [ male announcer ] your love for trading never stops. So open an account with schwab. And when a market move affects, say a Cloud Computing stock youre holding, we can help you decide what to do. With tools that help you see how market activity is affecting your positions. So when the time comes to decide whether to scale in or scale out. You can make your move wherever you are. And start working on your next big idea. Weve got some breaking news. Michelle carusocabrera, what can you tell us . I have a source familiar with the situation going on in the meeting in brussels and that source tells me that greece has reached an agreement in principal with the eu with the other finance ministers, but discussions are going to continue through monday. So once again, an agreement in principal, but it is not a done deal yet. It could fall apart. There will be more technical discussions and hopefully it will be finalized on monday. One of the concessions apparently greece has made is they are going to stay in the very hated bailout program. They were trying to get that completely revoked and theyre going to say in an eu bailout program. What isnt clear is whether or not there would be some changes to that when it comes to extension of matureitiesmaturities. I am told they were told it is out of the question at the moment. But it seems theres some kind of agreement in principle and perhaps well finally have something done and signed on monday. And if we can perhaps take a look at where we are on the euro which after hours would most likely be what we would see shifting here. I think a lot of people will be surprised that this has moved so fast given an absence of market stress. Well that may be why it moved so fast. That may be why step by step simon, you may have seen the finance minister of greece has been forced to back pedal on nearly everything. If hes backpedaled even more within these negotiations, that would be consistent with what we have seen. Hes going to come out and talk in front of the cameras at some point we assume so lets see how he characterizes the situation and perhaps he thinks hes getting something. Maybe theres going to be some kind of shifting within the bailout program, within the reforms that hes comfortable with. But right now it looks as if maybe he didnt get a lot of what he was trying to get. And we are seeing the euro come off the worst levels of the session. Its come back to the flat line 1 1. 1313. We dont know what the deal looks like or the technicals of renegotiation, but the important point for investors, there is something on the table, they are making progress, and it looks like theyre going to be able to come to some sort of agreement. And that greece also committed to saying within the eurozone. Correct. Pushing their exit aside. Michelle, can i ask you this question . Can we say about greece theres nothing that focuses the mind quite like an immediate hanging . I suppose. I mean i think the situation with the banks really had begun to corner them because thempy were running out of breathing room when it came to cash. If at some point the ecb got even more stern with them, they were facing a situation like cyprus where they were going to have to deal with capital controls, the inability to withdrew money from atms, not paying suppliers. It would push them into a corner and that could be why he maybe didnt get what he was wanted or maybe was willing to give in more than he wanted. I want to point out we are seeing a move in the afterhours trading. S p futures were higher. Theyre spiking up a little bit on this and the euro is going to the flat line. Michelle its kate. I wanted to say so much for a broad mandate of reforms in terms of greece and their economic programs. Were not seeing a whole lot of change in terms of how youre hearing this is playing out. Now, that probably doesnt surprise the Investment Community entirely but it may surprise some of the greek voters that voted in in new group. Thats a key point. Were going to have to see how the voters in greece react to this, whether and whether the coalition that the current government has can hold together based on this. And i want to caution, this is one source. Yes. Whats going to happen with this meeting is all of these finance ministers will come out, all of their undersecretaries will come doubtout. Everybody will Start Talking and well start to get details and spin as well. What is it 20 to 1 00 local time in brussels at the moment. As far as the public of greece is concerned, theyre getting exactly what they wanted because if theres an agreement in principle, they will stay in the euro, thats what 75 of greeks wanted. The question is where the rubber meets the road. What the austerity will be and what the other terms of any agreement will be. Im surprised that theyve agreed in principle to agree without actually having nailed that down. I dont know michelle. Yeah. I mean lets see. I want to definitely hear what the greek finance minister says when he comes out because thats going to give us a lot of clarity on those very issues youre talking about, simon. Weve also got christine lagarde, the head of the imf in the meetings at this point. Thei 346789 f imf is one of the creditors. The ecb is a creditor. The germans are a big creditor. Here we are again going late into the night with the euro group meetings. Yes, yes. And so lets see we understand that theyre preparing a statement at this moment and lets see the statement when it finally comes out. Why do you think we wont see a finalization until monday michelle . Its kate again. They had to work out the Technical Details of the extension of the current program. And why there are more Technical Details to be worked out, i could not get clarity on. Yeah. All right. Well leave it there for now. Thank you, michelle for bringing us that. Were seeing the euro go into positive territory. 1. 1325. We saw a little pop in s p futures. This is the kind of reaction investors were looking for. Thats a great scoop for michelle. I was looking at the ft and other sites and nobody seems to be reporting this yet. Well see what happens when the finance ministers come out. Harry wilson pushing General Motors to push that 8 million share buyback. But one watcher says the move may be in the best interest of the united autoworkers, not gm shareholders. The case will be made straight ahead. Tigers . Dont be modest. 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 . Weve got a rally going on for cisco shares in the afterhours. Jon fortt has more on the companys results. Thats right. The stock up more than 3 after hours after John Chambers gave guidance on the call. Unusual, normally he doesnt give it. The guidance was in line with analysts expectations. A lot of big enterprise players had taken the opportunity to guide down given fx and other headwinds and because cisco is known to sandbag their guidance chambers talking about how strong cisco has been over the last six quarters saying they have gone from negative 6 to 7 growth in q2 and saying we remain cautiously optimistic. We continue to listen to the call. The stock up nearly 4 . You mentioned europe middle east africa why would they have done so well . Its not clear. And so analysts will certainly want to know on the call because chambers said they even had growth in Southern Europe which John Chambers was not slow to point out was unusual in the enterprise enterprise. They had had trouble there along with everyone else but theyre managing to find growth in that region and also in asia at large, though china was down 19 , overall i think he was saying in the region it was down just 1 . Thanks john. At first it seemed like it was just another activist investors at work but our next guest says Something Else is in play here. Were talking about harry wilson, the restructuring expert who served on president obamas Auto Industry task force during the financial crisis and was instrumental in bringing gm out of bankruptcy. Now wilson is a gm activist investor and represents Hedge Funds Holding a total of 34 million shares asking General Motors Ceo Mary Barra for a seat on the board and is pressing for a stock buyback. Our next guest is a former gm bondholder who says the company isnt so financially healthy it should burn through its reserves and believes wilsons move is designed to boost the United Autoworkers Union and more he says than the gm shareholders. Mark joins us. Hes an associate fellow at the National Legal and policy center. Also with us kevin oleary, chairman of oleary funds and more importantly than all, a shark tank investor. Mark, make your case, if you would. Hello, simon. I think this is just a farce and the first evidence is look at gms performance since the ipo which is a little over four years ago. Underperformed the s p 500 by close to 70 . So the idea that this underperformance is coming because they have too much cash on their Balance Sheet is nonsense. So now we have harry wilson reentering the scene. Mr. Wilson best known as one of president obamas men on the auto task force, helped crush the individual bondholders to the benefit of the uaw. Since then the teamsters insisted he join yrc, worldwides board, to help with their negotiations in restructuring. Now hes coming back to gm to spend more of the taxpayer supplied money. Coincidentally, uaw still owns about 5 billion worth of gm common shares. Im betting those are the shares that are going to be purchased at a premium or at the least they can start selling those as this is run up. Hedge funds benefit, mr. Wilson benefits uaw benefits. It looks like a big pump and dump. Thats certainly one view. Kevin oleary, whats your take and are you shareholder . No im not. I would never buy gm shares because i actually think something very unholy occurred in the restructuring of gm. Instead of letting the natural darwinian forces of the market actually take these assets, completely cleanse them through bankruptcy, the way it should have occurred we took my money as a taxpayer, your money, and allowed it to go through a very evil and unholy restructuring. Didnt cleanse i look at it this way. Claims the legacy cost mark hang on. Kevin to the point thats being made here do you think it would be to the benefit of shareholders now if that cash was returned . They dont return enough cash to the shareholders and after all, it does belong to them. The Business Model is broken. We should have bankrupt that relationship put it through a cleansing so that it started as a new company, competitively on a global basis, and went out there and competed. The reason youre seeing it underperform continually and even now is because it bears legacy costs that were not shed through the bankruptcy. It was a huge mistake and you paid for it as an american taxpayer. I paid for it as a taxpayer. Im outraged. Weve got to leave it there. It is a heated discussion. An ongoing one. Wellsaid. Thank you very much. 2015 certainly has not been kind to the tech sector so far. But can tech turn it around . Weve got the bull and bear case. Thats next on closing bell. What makes it an suv is what you can get into it. What makes it an nx is what you can get out of it. Introducing the firstever lexus nx turbo and hybrid. Once you go beyond utility theres no going back. The sector has been one of the worst per forlers so far in 2015. Can tech turn it around this year . Possibly we could see this turned around. Red hat, semantic all of those leading the gains and thats putting it merely in line with the broader s p 500s performance year to date. You can see that right here. A number of experts like tech in 2015. Black rock chief investment strategist russ costrich thinks the sector is not cheap, looks reasonable. He says these are cyclical stocks that tend to have low debt and farewell in a rising rate environment. However, the sector is still facing strong headwinds from currency since an estimated 60 of tech revenues are coming from overseas, and thats why other folks are more bearish this year. So mike orourke at jones trading is particularly worried about large caps that are exposed to slowing Global Growth and a strengthening u. S. Dollar. Names like microsoft and intel that were outperformers last year in 2014. You can see here on weak guidance during the earnings season. It remains to be seen, whos right, the bulls or the bears but heres why it matters so much. According to orourke the tech sector drove the majority of the s ps gains for the past two years. You can see that right here. 29 in 2014. And 17 in 2013. So keeping an eye on the tech sector. Guys, back to you. Morgan, thank you. More closing bell after this. Startupny. Its working for new york state. Already 55 companies are investing over 98 Million Dollars and creating over 2100 jobs. From long island to all across upstate new york, more businesses are coming to new york. They are paying no property taxes no corporate taxes no sales taxes. 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We know that they have this suv, but its also going to be a high end luxury aielectric car. This is the mass market product. And so if theres any pushout, and we dont get real clarity on the model three, this is whats going to drive the stock right here. So to me i think you have to way. I dont think you buy the stock right here. I think if it goes down a whole heck of a lot if there is the disappointment, then it could be a good buy back towards that 180 level. Whats the options move . Theyre expecting a significant move. To dans point, on a selloff down underneath 200, i think its a buy. I think you have to be very