Transcripts For CNBC Squawk On The Street 20141216

Judge highs, low prices not helping the german economy. It begins with volatility in the market, russia fails to stabilize its currency. We do have it sparking in m a, buy iing towsman. Boeing ups its buyback. Cocacola updating the guidance for 2015. Below 2,000 for the first time. Russias central bank hiking rates 6 1 2 points. That has not stopped the ruble to sliding to record lows. The moscow stock market tumbling, all of this as the fed begins the twoday policy meeting today, which brings up an interesting point. If the discuss today, jim, is about considerable period, does the fed step on the gas here, when we know what that would do to emerging markets . The fed is very data friendly. They look at the things we are looking at. I i think the old fed before bebangie would ignore this stuff and say weve got to think about the next 5 to 10 years. This fed recognizes that the world doesnt work like that. I expect that there will be people who interpret yellen as saying that, look, shes changing it and theyre going to tighten, but i think yellen is such a reasonable individual. Shes very worried about inflation when it spiked. Clearly that was a good call, even cattle is down now. Thats the last remaining commodity, remember, russia wont take our beef. So, you know what . I dont think theyll come out and say, you know what . Its a doover. I think theyll be considerate and say were just monitoring the situation. I dont think they want to knock down emerging markets. I think they are smart people. I dont think theyre like the old days where they would sigh the guys on cnbc is too short term, were thinking about 2020. They dont think about 2020. But they have to be thinking about in particular lets called it the brazil russia certainly at this point. Russia, of course is our focus this morning, given that incredible move in the ruble despite their attempts to defend it with that 6. 5 increase in Interest Rates overnight. Since that began not too long ago, weve got talking about the positives and the negatives and how the market would interpret them. The positive, of course, being that huge tax cut of enormous proportions, movement of wealth, nonetheless the jean opolitical risk, were saling today it in russia, or the risk of transmission of a problem in currency to other assets, what that means, and weve been talking a lot about credit, and credit is interesting. The credit guys i talked to are more worried than the equity guys. As always. In credit you have to unlimit your down side. But youve got to Pay Attention. I remember when the credit guys were way more worried in august of 07. I dont think thats a fair comparison, jim, but its an interesting time here. Right now those who are worried about the fall in oil and all of the impact of it seem to be winning the argument in the equity markets, at least so far. You should be worried about europe. There are lenders to russia, austria is a big lender to russia. Italy is a big lender to russia. A lot of our companies. I was speak to dave coatie from a lot of our companies are very smart about it. A lot of Companies Like honeywell, like boeing, saying listen, this is a big tax cut. Heres the 9 05 mention of the g. E. , which goes into a company that went into the financial crisis basically as a bank, and is now going into the energy crisis. I thought that piece was disturbing, but known. It is known. Thats why g. E. Stock has been suffering, not as badly as others, not as badri as those that operate in russia. Did you see pepsi . I think its the speed of a move. Im looking at a piece by Morgan Stanley. Its june 26, 2014, schlumberger introducing a bull case, and Morgan Stanley goes all in, saying listen, guys, this is your chance. Let me show it canvas 200. 200 bull case, and ari is a very good analyst, and a nor american emp, cutting the deck again, saying the energy will take many quarters, so its the speed, a june piece saying this is your last chance, all aboard, and then a december piece saying this is your last chance to get out. Is that a good sign . And the answer is if they could isnt it likely that well, its different analysts. Could they be as wrong on the down side . Absolutely they could. Although, you know, any of of the guests we have brought on will tell you im not going to predict. You cant necessarily predict, nobody wants to calf a falling knife, which is what it seems to be crude is right now, not to mention the ruble. Fall safe, as cashin described coal yesterday. 2010 was the low for exxon. Chevron was 2009. Oxi was a downgrade. You have these are youve got to be careful about the independence. That is the best company in the industry, so halliburton was at 14. You look at these and say, you know what . If Oil Continues to plummet, which i think it can go right through 52, are we goods to revisit some of these prices . I dont know buy not. Why wouldnt you . They all spike after the downturn. I think the velocity of the decline is what people are worried about. I thought it was a great people. Meanwhile, companies trying to run their own businesses, dow component boeing announcing an increase of bitesback. Koch says it doesnt expe cok meantime Shareholder Wintergreen Advisers calls for the company to replay the ceo saying he is, quote, incapable of leading cokes turn around. Theres that story. A div hike as well. Cody, honeywell, these guys are saying and in russia, but you know what . In the end when oil comes down this much, you will restart growth in the second half the 2015. So lets not lose you could sigh that sfing, jim mci northwesterny and jim say they have not idea. I would come back and say theyre americas best, so maybe they do. Theyre no fools. The dust will settle here in this current volatile period where were dealing with an incredible move down in a key commodity, but the dust will settle theres a lot of craziness, but yeah. And then well take it from there. Honeydayold well and boeing. Boeing has a beautiful 2020. Honeywell, year one of a fiveyear, so i mean they are stuck with the idea of how to handle longer term. Theyre saying, listen, you know, its hard to imagine that with oil back to where it was before the headwind of 100 cody was saying, listen, 5060, maybe 40 60, then it goes to 100 and you guys in the media are saying thats fine. That was the headwind. When you remove the headwind, it is not bad. When you get the other cunning, hes talking about how there will be a renaissance, europe will pick up. What hes looking at, hes not looking at our screens. Hes trying to figure out whats happening in 2018. Clearly our screens are not reflecting that. Do you think that muktar kent comes in and says, you dont have the horses, partner . He might not put it like that. Hes ensconced. If heic take the heed i think hes good. You did raise the specter of this stronger and stronger dollar, to a certain extent. Is that having an impact on some of these stocks as we had. We will see a headwind, not a tailwind for some time here so people are looking at the revenues, looking at the earnings, and making judgments, even if its a currency, lets back it out. Right now theyre still letting you back out. That may not be the convey a quarter or two from now. Canadas tal manse energy if being agreed to be saying it would boost Oil Production by 76 , increase the reserves 55 . Yes, you heard me right, there is a fairly large deal in the energy sector, an oil Company Buying another one. There is those who say this is the time, if you are a major, for example, an exxon or chevron. You know, why not buy something at 60 instead of 120 . Remember bob davis . I do. In fact i saw bob davis a bit ago. Why do you mention bob . In 2000, he had a Company Called lycos. What happened with it . Do you remember . I do. A spanish company, not unlike repsol, the company was called terra, it paid 12. 5 billion for lycos in 2000, and then it was sold to the south korean in 2004 for 95 million. Im calling it early. I go back to 2000, maybe repsol is a better company, but that was the top. I think thats too early. What are any of those companies from that time . There is actually something in the ground here that has value. But isnt there capital structure . There is a very good note this morning well, im being too kind, a barclays note, which talks about funding problems for a bunch of company. They could be in trouble by the way, which suspended the dividend yesterday. Remember, theyre down 80 . Is that an early call . Talisman was down a lot, too. It was. All right, so exxon shouldnt buy anadarko now, they should wait in or they should have bought it when it was 120 . Theres nothing wrong with waiting. You might or you might not do it. Most often you run scared and then you look back and regret it. Thats afc the story of m a. I like that whole repsol terra thing. You did a lot of research this morning. Thats way back. Thats why they pay me the big bucks, while you guys are watching new orleans if youre exxon and take a longterm view, but anadarko doesnt want to. Of course not. Who would want to sell off a low . We are watching a developing story out of pakistan. Officials say uniformed militants attacked a school there, killing at least 126 people, most of them children, taking hostages. The Pakistani Taliban claiming responsibility for that assault. Pakistan Security Officials telling nbc news there were six attackers in total. We will continue to follow those developments. What do land lines and sears have in problem . Well chair what the chairman had to say. Walter isaacson, author of the innovators. Well talk about tech and on squawk alley this morning. It is still early. A lot more squawk on the street from post 9 in a minute. What can your fidelity greenline do for you . Just take a closer look. It works how you want to work. With a Fidelity Investment professional. Or managing your investments on your own. Helping you find new ways to plan for retirement. And save on taxes where you can. So you can invest in the life that you want today. Tap into the full power of your fidelity greenline. Call or come in today for a free oneonone review. Appointment when my teethntist a free are ready . Review. [girl] can it tell the doctor how long i have to wear this thing . [man] can it tell the Flight Attendant to please not wake me this time . The answer is yes, it can. So, the question your customers are really asking is, can your business deliver . Dollar, as jim tweeted earlier this morning, the collapse of an economic . A lot more on the more when we come back. [ 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. All right. Weve got about nine minutes before the opening bell on trading of what will be a tumultuous tuesday, im going to call it. Yes, indeed. Eog, buy the hold, and hess now buy the hess . Now buy the hold . Really . Im just reading. Dont tell me you would have done it here. No, im not saying i would have done it here, or maybe they were thinking here . You know, i want to look at it versus oil. I talked a lot about elliott, about their successful proxy. But you know what . At the end of the day, i find myself wondering, did it matter at all, jim . Or was it simply about oil going up . And oil going down. Versus eog, which is actually up, because this is production growth. I think the answer is, david, theres not a lot of first eog, where theres production growth. Youll see this stock is up for a year. All we really wanted was a growth stock in the end. By the way, oxi dismantled, too. So, i think you have a good point. Did it matter . In the end when youre selling a commodity, no, and remember, they guys, they dont know where everyone presumed there would be a market. They forgot about 2009, they forgot about these periodic i remember 1984, Dome Petroleum, like a 400, and then Dome Petroleum disappears, so weve seen a lot of boom busts in oil, and we seem to forget there are busts. There are. And activist plays, such as his, the activists have had a rough ergo of it. Im curious to see their performance numbers for this full year. Elliott did very well for a time, but theyre still in this stock, of course we talked about the really dark side being cliffs natural resources. And thats one where bhp and rio ban to close cliffs. They always come out and say listen were going to wipe out the marginal producer. To me thats kind of like a cartel. I think cliffs is the most vulnerable. They will tell you, david you dont know what theyre very sanguine, theyre happy people. Back to the research that started this conversation. Crude is roughly 50 lower than it was in june, and now youre telling me to go to hold. Look, im not telling you not you, this analyst. Is there any value whatsoever in a call like that . No more than the schlumberger remember fracking sand . A lot of people were bullish about those. Really, the schlumberger, 200 call, a bull case on Free Cash Flow june 26th. If you look at that, that is the top. I think what youre saying is, well wow, see, okay. Right here we fell in love with schlumberger, im just saying, yes, all these, though, if we use a 2009 paradigm, they could go lower, but then they bounce whether there suddenly becomes some discipline to the market. Right now theres no discipline to the market. Everyone is just pumping like mad. Were going to be watching the price of oil, of course, which is right around cut in half since june, watching the ruble and oh, yeah, weve got that opening bell. Well be watching an awful lot of stocks. Were back on squawk on the street right after this. You dont need to think about the energy that makes our lives possible. Because we do. Were exxonmobil and powering the world responsibly is our job. Because boiling an egg. Isnt as simple as just boiling an egg. Life takes energy. Energy lives here. Youre watching squawk on the street. The open bell in just about three minutes, with so much happening, most of it in other parts of the world. The russian economy in severe turmoil as they hike rates in the middle of the night to 17 , trying to rescue the ruble, so far not having much of an effect. Were watching the tenyear closely here. Gulf markets got smoked. Dubai, oman, saudi arabia down by as much as 8 , and germany a new 18month low. Not yes. I mean, theres a lot of people who overreached. All im saying is you dont need to be first. Were just now getting number cuts in the oil, just now, so wait a little. This was your point after exxon got downgraded earlier . Just wait a little. Theres no point in rushing in to buy anything right now. Let things come in. Its fine. Is that okay . Yeah. Dont want to lose sight of the credit markets, which i do feel are incredibly important here. We talked about it any number of times. Spreads continue to widen there, with, of course, as carl said, the treasury, and its its actually the liquid names that are being sold now, which are not energy. Energy, youre not going to get anything done there. So youre starting to see some of these bonds that are not energy related. Horizon . Well, theyre not theyre in the index. But get sold. You know, there may be some opportunities there, some are telling me, but theres also that concern, because high yield in equity do tend to track each other. Also, front of f. T. , says a trillion of production is at risk . At the same time goldman puts out a piece recommending bulk and materials saying look, oil is 10 of the construction, and then theres the recent. So its yin and yang. That piece, thats the cbi, thats the floor not nor floor, but flr, and look, thousands products shouldnt be done. No reason to build these projects when you can drill in the permian, if you just keep your ballard dry. Theres the bell. A look at the s p at the top of your green. Ingals and snyder celebrating its anniversary, a provide of i like it you know, last night 9 futures at 330 were up 8, but oil was done 150, give me a break, who is doing that . But when you get hit if we go back to the futures where they were around 7, down 17, then you look a little. Speaking of being down and now up, boeing is the best s p gainer. Down about 11 last week, but hiking the buyback by 2 billion to 12 billion. Does that undo some of the longterm concerns . Lets wash 2 look. What i like about mcinernie, hes not saying no one is going to buy our planes. What he is saying is, look, its very hard to get planes, weve got a tenyear view, try to get a plain in 2020. I was worried about airbus and the dollar versus the europo, but mcnerney is making a statement. I wish the defense part of boeing was doing better, but that was an execution issue. Maybe hes got that fixed. I dont like to bet again him. Ford was downgraded yesterday, r b is cutting gm. I like the dividend there at gm. I think it will be boosted in january. I just think the panic in the market you know, theres a lot of panic, but i can get a 4 yield with a cash flow going up. Im comfortable with that. Obviously gm goes down anything goes down on a downgrade. I thought range resource, you know sell at a hold. What happens is anything that holds the sell theres a lot of panic in the market, but i see you have to go through this pain. You have to go through this pain, because you dont know whether some Austrian Bank or some italian Bank Announces tonight i was reading a piece about templeton. They have a young gun. I dont really want to own ukraine paper, given the fact that ukraine is asking for billions from the west. Boy, the west got played by ukraine. Im sorry. I hate putin, but the west got played. The west went all in at the absolute top. Remember, if you want to know the velocity. Carl you took a trip in february. To sochi. Did you would you go now with the ruble . Somebody said if you have a siberian vacation, if thats your dream, now is the time. Now is the time for ukraine to invade russia, if theyre going to do that. Do you think you get an upgrade, like im going to give you a king, now im going to give you a suite. People went to sochi. Now thats unimaginable. Thats the ped. I dont like the speed. Things should slow down. Of what they dont know being reminiscent of most likely it wont, but we dont know the answer. When you have a destabilizing event where a 50 move down in oil since june, the tendency especially in this period over the last month is you just pull back and try to assess. Weve known that russia was in potential dire straits. That seems to be coming true. We dont know if theres any transmission mechanism, as we like to say, from russia and the fall of the ruble to any Large Hedge Fund or anything else that might have an impact. Im worried about petrobras. And rightly you should be. Their breakeven is higher than from here. Does this mean that you buy grub hub on the goldman yaw, goldman upping to buy or just buy the ten year. I saw that upgrade by goldman. I was thinking, you know, this company, bristolmyers t. Grub hub . Grub hub . I mean, but grub hub . To my, this is not the time to upgrade grub hub. Im not sure its the time to buy the tenyear, either. The tenyear doesnt seen when you have the german bund yielding 57 basis points. But it is impossible im neonot crying for rich people who cant get income, but thats why you have to find i think gm will sure love european, they have latin, but they have good cash flow. Im not saying buy gm today. That would being foolish. Today is a down dahl day. How about the rsx . Its think youre early. You want to play that game. Cvs announces great numbers today. The last i look i cannot use those machines at the checkout where you have to swipe it yourself. I think thats horrible, and i dont smoke, but if i did smoke, i would be anticvs, but cvs is not in russia, largely domestic. The Dollar Stores are not in russia. Nope. If you can bet in some retailers that are good we have a bifurcated market. Lets watch the transports, because they do have this jet fuel, or they do have fuel, and its coming down. Yeah. One big reasons futures spilled, according to traders here, was vidaman over at the ecb arguing again that sovereign purchases will not be part of the the merkel in a pantsuit dynamic is still intact. I cant say enough bad things about germany. They are just trying to balance that budget. The great engineer, our president herbert hoover, was very concerned about that balanced budget during that period 29 and 30. I think that he was early when worrying about the balanced budget. There are people on the wrong side of history. Our country is always urging china to do more still his. Why dont we tell them stimulate, right now. No, we dont do that. We treat them with great reverence. It seems to be happening very slowly, and a lot of cunning, by the way, control the price of gasoline. They havent even cut it. But i do think that germany should be buoyed by that. Klaus kleinfeld, to knows more about germany than i do, hes say, listen, dont write off germany. It could have a turn. Okay. I wont. Again, klaus kleinfeld, cody, these guys are really smart guys. They have seen things. Theyre not Hedge Fund Managers who just got who deliver alpha and say rates are going to 4 . Theyre not 4 ers. Well, just a few days after we almost hit 18,000 on the dow, were now 100 points from 17,000. Bob pisani is on the floor. Once again energy is leading to the down side. Tech also down. Im a little surprised to see that. Financials are also weak. Consumer discretionary also down, but these arent big declines. You want to look at some of the major names, objections dental, all down fractionally. This is modest compared to the declines we have seen. I tell you what you want to watch. You said to watch the end carry trade. Thats the classic safe haven play. So much money is any reversal of trend is something that the traders watch. Middle eastern markets have been down, too. I put them up there. You can eabu dhabi, and the big thing i want to mention is that yen carry trade. Theres the dollar yen. 116 here. A lot of money is here, so thats whats got everybodys attention. This is the safe haven trade in the world are world. Yen strengthening, thats a bit of an issue along the way. I want to show you some of the Collateral Damage from the decline in oil. Jim look at Chicago Bridge iron. This is a big Company Involved in Construction Products for the energy industry, included liquefied gas. They got a downgrade from ste stevele yesterday. About 40 of their revenues come from the oil and gas business. That was 67 a few weeks ago. You can see some of the class real damage associated with the decline. Meantime high yield, sort of the poster child that weve been pulling out down fractionally again, but the steepness of the decline a little smaller than its been. Mark zandy was talking about 100 million tax cuts from lower oil. Thats great news. I was thinking, you know, the beneficiaries would be the people that thoo americans are spending money on. Buy silicon valley. That is not happening today. Even some of the big tech names are down to the down side. I thought generally they were very positive news. Honey honeywell last night keeping the guidance, and boeing, that 125 increase in the dividend. A little better than 2 percent. I would say theyre higher than average at this point. Heres the thing that i thought was very interesting about their comments. Look at the organic revenue growth, the projections for 2015. Im talking organic revenue growth, all talking about the same thing. 3m is implying 3 to 6 organic growth. Honeywell 4 . Folks, i think that is pretty respectable. We are in a slow growth world. That means 1 or 2 . When youre talking about 4 to 6 organic revenue growth, those are not bad numbers given the Global Nature of both of these companies. Jim, i thought the comments from both of them today, both of those companies were very encouraging. Right now the dow down 60 points, back to you. I was talking to dave cody, 4 growth in a world thats growing . People do like it. If you can do 5 , 6 , and these guys are very good at their jobs . Better than weedman in germany . Smokin weedman, thats what we all to call him. Lets get to the bond pits. Tenyears around 205. Hey, rick. Hi, carl. You know, there is a threat of this as we begin a twoday fed day that goes right to the heart of creating liquidity, at the qe variable, how it pushes investing in areas where all of a sudden its the hunt for yield, the hunt for return. And then it all goes crazy. Whether its the leverage and carry trade as bob talked about. Here we sit, as carl just said, at 205, down a little more than a half a dozen basis points, a twoday shatter shows, like a lot of markets, we know somewhat why this is happens, deleveraging, the notion of oil and all the revenues that have been amplified, but technically people are still trying to pick bottoms, whether its in yield or energy. Like what happened when we traded under the low. Its now, 19 months, the spring of 2013. On the long end its an even more dramatic move. Looking at a 30year chart, basically around the time school was starting in 2012, about 27 months ago since we settled at these areas. Bunds, yes, theres plenty of reasons to look for it to go do you think, but it accelerated. Right around 150 basis points, thats another big reason dragging our rates down. Foreign exchange. How many months be talked about the dollar is king. Well, it is, but maybe its a shadow boxes monarch at best. Because one, the carry trade which helped propel that, when it reverses, bob pill sannist is spot on. The yen is at the highest level against the greenback, but theres another carry trade here. Its called the euro, but every bit holding a place on the chessboard of the leverage game, and we are at the best levels on the euro versus the greenback, and you want to continue to Pay Attention to some of these areas right around november for the pound, because the pound is getting caught up in the cross trades between all the european currencies. How will this end . I cant tell you, but its fairly interested to think that the fed will be talking about tightening rates, maybe that windows has long closed. Back to you. Rick, thank you very much. Whether we come back, facebook calls cookie james the game of the year. Can it overtake candy crush with help from a china strategy . Were going to talk to myspace cofounder chris dewolfe. Take a look at the sixmonth chart i believe. Thats a long way from 107. 73. Well be right back. This is a burrito made with chocolate, soybeans, and apricots. What kind of chef comes up with this . A chef working with ibm watson, on the cloud. Ingredients are just data. Watson turns big data into new ideas. And not just for food. Watson is working with doctors and bankers to help transform their industries. Today theres a new way to work. And its made with ibm. I take prilosec otc each morning for my frequent heartburn. Because it gives me. Zero heartburn prilosec otc. The number 1 doctorrecommended frequent heartburn medicine for 9 straight years. One pill each morning. 24 hours. Zero heartburn. Alright, so this tylenol arthritis lasts 8 hours, but aleve can last 12 hours. And aleve is proven to work better on pain than tylenol arthritis. So why am i still thinking about this . How are you . Aleve, proven better on pain. Speaking out about his companys struggles, eddy lamp certificate comparing the retail landscape to land line phones. In a blog posthe writing in virtually every city across the country, theyre trying to figure out what to do with large windowless buildings. Similarly some of our stores are simply too large for our needs, girch the population shift, new roads are built and new retail areas opened constantly. Rear storing them to profitability has a challenge. Man, does that sum stuff up. One of the things the Restoration Hardware said to me over and over again, plants die in malls. Ant dont want to build a store where a plant cant live. Theyve been building these museums, galleries, Restoration Hardware being eddie lamper will not open sears i way they do this is showcases for restoration. In some ways i would say that sears is trapped. Theyre in those big buildings. They say theyre going to be more proracketive, more flexible in dealing with those spaces, selling some of them where theres a demand for that, or splitting them. If he telling us that youre would you then go buy a verizon building from eddie . No. What i wonder about is, can he truly transform this company which continues to have losses each year. Theyve done a good job of shepherding without having a crisis in confidence, but when jimmy writing armed with more information than ever about how members want to show were going to use these insights to adapt to where Member Experience will be paramount. I dont exactly know what that means. Omni, if you have an omnichannel with all these places to bring back stuff, they should have an advantage. They do have this members business. Hes trying. But in some ways, this was not the time, just closing bad kmart shows. It was years ago. Sometimes ur just too late. Just could be too late. They were writing that stories in the 90s. I dont know, but lands end didnt have good numbers. They obviously spun off and sears has a lot of balls in the air. I do come back and say, you know what . They are exactly who they its like a danny green situation, we are who they said we are. Hes saying that as coach of the cardinals i feel like eddie is saying basically were not good, and were not good, but dont worry, because well be good. Okay. Wait until next year. The mets are going to be good next year. When we come back, well get stock trading with jim. Even with some of these losses paired, this is the lowest level for the dow since about halloween. 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Just about all you need is a finely tuned. Pen. Get zero due at signing, zero down, zero deposit, and zero first months payment on select new volkswagen models. Thats why i always choose the fastest intern. R slow. The fastest printer. The fastest lunch. Turkey club. The fastest pencil sharpener. The fastest elevator. The fastest speed dial. The Fastest Office plant. So why wouldnt i choose the fastest wifi . I would. Switch to comcast business and get the fastest wifi with the most coverage. Comcast business. Built for business. Time for cramer and stock trading. This is not an oilrelated call, though oiling is bouncing. One of mere Favorite Companies is ver i phone. They have the brandnew technology. Were going from pin to slide. I thought it was interesting in the comps call, they talked about how applepay, remember that, is increasing demand. So takable from verifone. I say p. A. Y. Should be bought right here, right now. Whats on mad tinen tonight . Eddie lamper, Restoration Hardware, gary friedman, tom farrell, building outed liquefied natural plant, and timothy boyle. I love that story as much as i love deckers. Its a very exciting night. Remember, gary please, before you watch the show, he did his Conference Call as a video. Its so beautiful. Like i said its the homeland of Conference Calls. There is no haqan i want at do you worry about what russia does . Why doesnt the central bank get together with putin and come up with a strategy . It just seems so disorganized over there. Were seeing some interesting stuff. Cattle may have thats going up. Theyre seeing some interesting action in positive areas on oil going down. Its the first dame ive seen people saying, you know what . This is a benefit that i think dave cody says well be talking about. Nicer house than mine, and he as had pools and never invited me to the parties. Simon, whats up next . The head of bank of americas Commodity Research called oil to Francisco Blanch will be here again in five minutes. The ceo of coupens. Com, and will russia stay the hand of the Federal Reserve at the twoday meeting . Hour two of squawk on the street. New cadillac. My baby drove up in a brand new cadillac. Look here, daddy, im never coming back. Discover the new spirit of cadillac and the best offers of the season. Lease this 2015 standard collection srx for around 359 a month. Im spending too much time hiring and not enough time in my kitchen. [ female announcer ] need to hire fast . Go to ziprecruiter. Com and post your job to over 30 of the webs leading job boards with a single click; then simply select the best candidates from one easy to review list. You put up one post and the next day you have all these candidates. Makes my job a lot easier. 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Tdd 18003452550 so you can make your move, wherever you are, tdd 18003452550 and start working on your next big idea. Tdd 18003452550 tdd 18003452550 open a schwab account and you could earn tdd 18003452550 300 commissionfree online trades. Tdd 18003452550 call 18776703357. Tdd 18003452550 or visit schwab. Com trading. Tdd 18003452550 schwab trading services. Tdd 18003452550 your goto for trading knowhow. Tdd 18003452550 good morning, welcome back for sdwoik squawk on the street. Were here at post 9 much the new york stock exchange. Sara eisen is off this morning. The focus is on the ruble, but oil trying to stage somewhat of a comeback here. Awfully close to 55 on the west texas. We have some sdpirations on brent today. Okay. Lets get to or road map this morning. Stocks in the red. The ruble falling to record lows, the dow and s p down now for a sixth time in seven days. Plus oil still at 5 1 2 year lows, well talk to the head of commodity reserve at bank of american. Investors looking for clarity on the timing and the size of Interest Rate hikes. Coming up a bit later with a little over week under christmas, how can retailers take advantage of lastminute shoppers. The ceo of coupens. Com will join us live. The ruble falling to alltime lows today. Michelle carusocabrera has more on that. Interesting times. Simon, late breaking news, president medvedev, an emergency meeting with the head of the Russia Central Bank along with the finance minister and economics minister. If youre just waking up on the west coast, its been a dramatic morning. In the middle of the night, 1 00 a. M. Moscow time, the Russia Central Bank raised Interest Rates from 10. 5 to 17 . Investors, not to mention russians themselves have been abandoning the russian currency due to rising risks there. The central bank offered to pay a much higher Interest Rate, a whopping 17 in the world of near zero in much safer places. It did not work. It fell to almost 80 ruble to the dollar, 79. 66 better recovering to the left you see there. These are huge potential destabilizing moves. Why is this happens . Primary right now the decline in the price of oil, citi estimates when oil falls 10 per barrel, russias gdp falls 4. 5 for 2015. Appear on top of that the sapgss imposed by the west, that prohibits Western Banks and corporations from rolling over more than 100 billion in debt due coming next year. Thats a whole lot hard tore pay back if you owe dollars, but get paid in ever weakening rubles. There is a lot of key differences between now and then. First currencies used to be fix, now they float, so the markets can adjust in real time rischa back then and a lot of currencies in asia have much higher levels of reserves so they can defend their currency. Russia has 4 billion in reserves, though the liquidity is debated. Their corporations a. Weve highlighted, may be in trouble due to difficulties in rolling over debt. Secretary of state kerry is out with comments, saying in his words there are signs of constructive choices by russia in the hopes that it is days ahead we did get a clear defined path by all parties on ukraine. Says hes confident that the u. S. And europeans will respond on sanctions if in fact russia continues to move constructively. Ultimately what we said to know, right . Do all of these pressure us force putin to react differently. Hes appeared to be tougher and tougher in the past. At what point does he finally get pushed into some corner where he acts differently . Im not sure anybody knows at this point. Thank you, michelle. The santa claus rally is dead in its tracks at the moment really not materializing as russia today weighs on stocks. Joining us is month goply stocks, and Deutsche Bank chief economist and cnbc contributor, john la vornier. The response from the feds was to cut Interest Rates. They cut in september, cut in october. Greece was given an impromptu press conference and anowed the rate cut and then they cut in november. Because of russia. Yeah, well, remember too the equity market was down about 20 over a sixweek period back in the summer, so there was a real fear that global contagion would slow growth. The economy boomed on the back. We grew 4 , and the fed was raising rates. I understand the point youre making. I want to point out what may not have been transmitted or understood. Lets show a chart of where we can where the ruble has gone against the price of oil. What you have is the fact that oil produces currencies are plunging, means that theyre actually making more in local currency terms from the barrel of oil than they otherwise would have done. So domestically this is not a problem. Theyre getting more rubles from their oil around the world. The problem is the u. S. Dollar denominated debt, not just russia. It could be those in latin america, those in africa, or indeed those in other emerging markets. The question is do we have a contagion that the fed needs to worry about . Remember, russia was also intertwined with longterm capital. So you had a lot of leverage in the system. Certainly theres been a reach for yield in this cycle. You dont have the hedge fund leverage. So we dont have a leveraged system like we had back in 98. Mark, what is your advise to investors . The strategy remains the same. We had a test of this back in september to october. And it encouraged a corrective phase, which i think were in the midst of today, which may ultimately repeat Something Like we had in september or october, in the midst of a u. S. Economy that continues to elicit signs of strengthening, we think it ought to be used opportunistically. And. Really quickly, guys, i want to interrupt here. Were getting a note actually from former Florida Governor jeb bush, who said over the holiday i had a long conversation with the family, and as a result of the conversations, i have decided to actively explore the possibility of running for president of the United States. I plan to establish a leadership pac to help him facilitate conversations with citizens across america. In the coming months i hope to visit with many of you and restoring the promise of america. A lot of people will be very excited by that prospect as well, a third bush to run. Can i come back to the fomc meeting. For many people what they do and say tomorrow is incredibly important. Do they have the tenacity to say the Financial Markets dont matter, i am focused on the very Strong Economy in this country which will get stronger, and therefore we have to talk about raising Interest Rates at some point next year . Yeah. Weve wasted a considerable amount of time and energy debating considerable time. I hope so, simon. You hope they i hope they do what you just said, which is focus on the economy, realize this oil cut, while hurting a lot of people generally is very positive for the u. S. Its more likely theyll get unemployment lower. Wage pressure and ultimately foreign inflation higher, but again this fed has generally aired on the side of being dovish, and they have chickened out a few times, so well see. This is why people like joe argue like they do. This is a oneoff fall in the price of oil, which eventually will fall youve had figures, andic have core inflation. Theyre supposed to be setting rates. Do you think equities will fall out of bet if they do take considerable time out of the message together . I dont think so. I think its widely anticipated. A recent survey suggested about 60 of those respondents are thinking that considerable time will be removed. Stanley fisher recently made some comments to almost sit that i think theyre focused domestically gives them the cover to remove that language and hint that perhaps that market pants pants another expectations perhaps may be appropriate, such as mid 2015. If the santa claus rally has canceled for now, does it show up somewhere else . Does it emerge, say, in january . It could very well, simon. I think theres a lot of factors, sort of confluence that Market Participants are attempting to digest, again in the context of full valuations. So in the absence of the u. S. Importing some of the weak growth abroad, to suggest were teetering on the verge of recession, think i they the equity market gets their legs back. If not before christmas, soob after the new year because of data that suggests that comp Profit Growth ought to remain you have to worry more about multinationals in terms of their business abroad, but that said, i think for the most part, equities remain the asset class of choice. Thank you both. Thanks, simon. A market flash here, simon . So were watching shares of the russian stocks that trade here in the United States. Theyre all getting hit hard as the russia ruble, the currency crumbles here. The google of russia here, online payment provide, and telecommunication provider are all plummeting. So a rough day for the russian traded issues, carl, in the United States. Dom, thanks a lot. When we come back, oil prices continuing their dramatic plunge. Just how low can we go . The head of Commodity Research from bank of america will join us. Tesla just broke 200. Back in just a minute. S generat with natural gas instead of todays most used source, how much are co2 emissions reduced . Up to 30 . 45 . 60 . The answer is. Up to 60 less. And thats a big reason why the u. S. Is a world leader in reducing co2 emissions. Take the energy quiz round 2. Energy lives here. Oil continues to take a hit on Global Markets and currencies. Joining us today is b of as head of Commodity Research who recently changed the oil forecast. Good to see you again. Thank you for having me again. After that last opec meeting, you loyered your target, saying brent could go to 60. Does texas hit 50 now . Yeah, i think we are three or four dollars away, so i think we could see some downside pressure. The question really is where does it stop . The absence from i think in the last we had, we talked about how this incredibly bearish for oil markets, and also how much volatility we were going to see, and i think weve seen both elements. A huge amount of volume tilts. Why have they been so stubborn in their comments . Why do they not seem to blanch at the prospect of 40 . I think theres geopolitics involved, a market share issue involved. I think however they are taking this to an extreme. This is a poker game of high stakes for saudi, as you were talking in your prior section, the russian currency, as well as the russian assets are falling out of bed. Obviously iran is in the doldrums. Other oilproducing nations are going to be struggling here. And frankly lower oil prices, while theyre good for main street, theyre not great for wall street. Theyre actually hurting the stock market too. So its starting to hurt. The question is, i think, will saudi step in if we have a on the screen. Will they be able to take it and i think probably yes. Francisco, what is wrong with the oil market . I asked this question yesterday, and i make no apologies for asking it again. Were basically half the price of oil from the highs in the summer. Youre trying to clear 1. 5 to 2 to 2. 5 to a supply demand imbalance. Its a tiny imbalance in the market overall, but we have dropped half the price. I mean, why is demand and supply so unresponsive to price that nothing shifts . Or were the prices of oiling rigged artificially high in the first place . Its a combination of both. Prices were high remember, up until this summer, we have the most stable Production Profile in the markets history, because the saudis were accommodating supply shocks, but they have stopped doing that. The mac is cash costs are very, very low, so in order to push producers out, if they are not doing so just takes a very painful price on the screen. Remember, cash costs are in the 30 lower range. Back in 2008, we did not see even canadian mine projects shut down, so why would they do this why would they do it at this time . Cash costs are really low. Thats the real issue in oil. Just like we have in frankly many other commodity markets. They can also be very volume tile. On the other hand, you do argue that the faster and steeper the dropoff, the stronger the rebound will be potential in q1. Do we still have that . Probably looking at the second half of 2015 for a rebound. Remember that, to your point, we only have to figure out 1. 5 at most, i think, for the supply demand imbalance. One of the things thats going to happen is supply is going to start to drop. Again, were looking at six, nine months out. Similarly well see demand pick up, also within the same time frame, so it suggests that it takes about 6 to 9 months for this thing that play out, but youll have exactly supply going down, demand going up. And of course theres also the risk of geopolitics which i think is increasing by the minute here. Buckle up, Francisco Blanch. Thank you. We just jumped about 70 points on the dow in a few minutes. What we have, simon, is al symptom, the french Power Company is close to settling wlakd be the largest ever bribery case with the u. S. Justice department. The numbers right now rho, according to multiple reports are they could be settling a bribery charge. What the Justice Department had been alleges with the French Company al stom, one of their officials had try to do bribe officials for power projects. Back in the summer, they agreed to sell much of their turbine company to general electric. Al stom very much in focus, and comes on this day when of course, this is aural analyst day in new york. Up next on the program, there are now only eight shopping days left until christmas. That means crunch time for the retailers. How can they take advantage of those lastminute shoppers . Well talk to the ceo of coupons. Com about the benefit of digit at deals. Im angela, and i quit smoking with chantix. People who know me, they say i never thought you would quit. but chantix helped me do it. Along with support, Chantix Varenicline is proven to help people quit smoking. It gave me the power to overcome the urge to smoke. 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Ask your doctor if chantix is right for you. Until christmas now, which has retailers turning to digital and mobile deals in order to drive those instore sales. Joining us is ceo steven boel. Thanks for having me back. This digital system connects to the point of sale, be that dolan general or walgreens . That is absolutely one of the drivers and the primary driver for our business. But you said it right, this year its all about digital and all about mobile shopping. When i say mobile shopping, i mean were seeing the two at the gnome nons. One, people are using their mobile phones to investigate products, and were also seeing people do purchasing. Though, in fairness, if i look back to your results, youve said that you think most retailers pull that into the third quarter, so you were guiding slightly lower from where we are now. What we want was that we saw manufacturers, and thats primarily for grossly have pulled some of those promotion dollars into q3 from q4. Steven, we need to talk about your stock price. Youve had a phenomenal year since you ipod at march, the stock rocketed higher and youve lost about half of your market cap since then. Goldman sachs, as youre aware, retreat it says the stock could go down to 12 a share because of the multipap you are at and at competition of new retailers. How do you react . From a competitive perspective, we dont see any companies that provide the breadth of service we do at scale. Then when it cups to, you know, an annual its recommendation, youll be a much better expert at understanding a business than i am from a financial perspective, but we spend a lot more time with mark ma hain quli, and matt schindler, and i would direct you to those reports to get a better understanding of our business. Fair enough. Obviously youre trying to make as much could you fit into a Larger Organization as a technology, 1. 2 billion, where might you fit, do you think, further down the line . Where might there be some m a . Were really, as you said, were focused on building a big sustainable, durable business. Were only, you know, 10 into the conversion of couponing from the physical offline world to the online world, and were responsible for approximately 10 of all coupon redemption in the u. S. With 90 more to go, the focus is just on continuing to build a business, as youve said, weve had a phenomenal year. Steven, have a great holiday. You too. President and ceo of coupons. Com. Thank you. Straight ahead, before the break, a check on the dow going positive here, s p 1992. Well be right back. The Holiday Season is here, which means its time for the volkswagen signthendrive event. For practically just your signature, you could drive home for the holidays in a germanengineered volkswagen. Like the sporty, advanced new jetta. And the 2015 motor trend car of the year allnew golf. If youre wishing for a new volkswagen this season. Just about all you need is a finely tuned. Pen. Get zero due at signing, zero down, zero deposit, and zero first months payment on select new volkswagen models. As nations develop over the next heres a 25 years,for you the world will have almost twice as many cars. How much fuel will be needed to power them . About the same as today . 50 more . 100 more . The answer is. About the same as today. By 2040, advances in fuels and vehicles could enable about 75 better fuel economy than today. Take the energy quiz round 2. Energy lives here. Thank you. Ordering chinese food is a very predictable experience. I order b14. I get b14. No surprises. Buying business internet, on the other hand, can be a roller coaster White Knuckle thrill ride. Youre promised one speed. But do you consistently get it . You do with comcast business. And often even more. Its reliable. Just like kung pao fish. Thank you, ping. Reliably fast internet starts at 89. 95 a month. Comcast business. Built for business. One hour into trading, here are some stories were watching. Cvs health up about 4 , the drug story change raising the different 27 , projecting up to 16 earns growth. Boeing is the biggest gainer on the dow. Hiking its dividend by 25 , and goog the class a share, a new 52 puff week low, down almost 14 in the past three months. Stocks have seen sizable gains so far this year. Whats to come down . Steve liesman has the detail on that in the results of his exclusive cnbc fed survey. Simon, it looks like theres more gains to come. This group has become optimistic. I dont know if thats a sell or buy signal, but the average for 2093 for june 2015, thats a 5 gain for the first half of the year. Not too shah beeny. Moving on and looking for the full year 2194, thats an 11 gain. Theyre theyre looking for a 17 gain, so not too bad. We have a story of higher stock prices, but we also have a story of xh concern about a correction here of a 10 correction being 45 , so thats less than half. What i want to show you, outlook here for higher stock prices, but also lower yields. This outlook has come down and down and down. It was 3. 5 back in april 2000 back in april of this year for 2015, now its 2. 63 . You can see across the spectrum going out as we lay out the outlying years, under 3 is the current outlook for the tenyear, moving on and looking further down the line. And also what you see when you look at the fed funds rate, that has also come down quite a bit. 2018 is the number for that. We just wants to show you one more chart, the effect of oil prices on the economy. Who theyre looking for here, i think it haus 0. 4 of a for the gdp and reduces inflation. So this group right now, carl, is looking for better economic outcomes from oil, though i will tell you, the number one concern for the u. S. Expansion is europe and geopolitical risk, carl. On the other hand, as they like to say. Thank you very much, steve. Markets inching into positive territory here. Hes bring in art cashin, man, do we need to see you today. Thank you. Subtle 98 all over again . Well, i dont think so. Theres a lot of Different Things thats not quite as leveraged as stuffs. You remember we had kind of a cascading waterfae effect. And then in the meantime the fed was petrified of y2k. So we had all of that stuff coming together. Anything can happen. You know, weve discussed this before, not just the currency. Mr. Putin may try to surprise everyone with some dramatic attempt. So geopolitics is still out there. Dramatic attempts mean militarily, meaning Central Bank Moves . What do you mean in the realm probably militarily, somewhere else in the region. I think he quite honestly believes and with some credibility that nato would not make any military move against him. He might face a new round of sanctions, but probably can do what he wants or go where he wants to go. It is all about popularity and keeping your image up. You pointed out 9 seasonals, which have not been helping the past few days, are getting better. The day is before a fed announcement has an upward bias, too. We have several things going for us. Maybe thats why were pulling slightly into the plus territory, though the other thing is finally oil looks like its trying to stable. I think despite the protestation, theyll be worried about whats happening in europe, possibly whats happening in china. Things may be getting worse there than what it looks. So i think they may delay a bit. You know, talk about given Global Economics being the way they are, will extend out a bit longer. Do you think thats the right thing for them to do . At this point yet. Not only financially, but geopolitically, we went from the sydney hostage thing yesterday to a school in pakistan today. Geopolitics may break out on us at any time. I think you want to be a bit careful. Lets talk some hash marks. What level constitutes success for the bulls today, if any. Well, you know they have violated the 100day moving average in both the dow and the s p, but it hasnt produced any trap door selling, so you can say they may be trying to test these areas. That would be about 17,080 in the dow, down around 1978, i think, in the s p. All right. Do you believe europe is a big source of selling this morning . I think we had some come in. The volume for the first 30 minutes was over 150 million shares p ordinary it will be between 90 and 100 million shares. That usually signified some activity from offshore. I was surprised in your notes today, the world is in shock, you used the word shock, to describe the rate hike over the night. Think prit much it is. This is a huge move in that currency, and we have to see what el preverberations are. Hey, robert. Well, they built the biggest yachts, the most expensive mansions, and often bid for the top artwork in the world, but now the billionaire russian old i oligarchs are getting squeezed. We dont know whats happening in dollar terms, but this crisis could cause some dramatic wealth destruction in russia. Take a look. The first guy, hes a close ally of putin, worth around 10 billion, a target of sanctions, in a gas producer in which he has a large stake, has lost more than a third of its value. Hes also the target of a Money Laundering probe. S and another former putin judo partner, and his Construction Companies have made billions from construction projects. Unclear whether the government will be able to fund all those infrastructure projects. He also has the issue of the Italian Police just seized some of his villas in air did nottia, as well as a hotel in rome. And also losing a third of the value in recent months, with billions in foreign since can i set. Thats the big issue as the ruble falls, those debts become nor expensive. That could hit i gore sechen, considered the most powerful in russia next to putin. He had to sell his company to statecontrolled rosnet. Its actually less than they bought his company for, but he is now safe, and russias richest man made his original fortune in metals and mining, but some of his companies have fallen dramatically in value, but get this, guys, hes more than made up for that whats happening in russia with his stake in alibaba. It will be hard to find someone who plays the violins for all the they guys. It shows another impact of this crisis. Robert back at hq, thanks. Whether we cull back, Walter Isaacson will join us on squawk alley. Well talk some tech and jeb bush and russia. Tdd 18003452550 [ male announcer ] your love for trading never stops, tdd 18003452550 even on the go. Tdd 18003452550 open a schwab account, and you could earn tdd 18003452550 300 commissionfree online trades. Tdd 18003452550 so when a market move affects one of your positions, tdd 18003452550 schwab can help you decide what to do. 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Believe it or not, energy is the biggest gainer as investors look for the beaten down plays in the sector. The overall sector is down about 13 , leading the way higher, you have a range of companies. Its worth noting, carl, there are 39 new 52week lows, 25 of them are energy stocks, and theres been a lot of unsuccessful bottom picking so far this quarter. Back over to you, carl. Thanks a on lot. Lets check in with rick santelli. Good morning, carl. I would like to welcome or special guest charles beaderman, hes head of trim tabs, recently received a five start rating from morningstar. Thanks, charles, for showing up this crazy oil tuesday happy holidays to you and to your lovely producer leslie. Thank you. Listen, charles, is it too much of a stretch when i look at 30plus total year return on a 30year with principally appreciate in yield, close to 10 on a ten and say that the fed by creating some of these programs has taken the premier denominator and pushed it to a level where all the other adjustment has caused some of the issue that is we see metastasizing in the crude market . Theres no question in my mind that the zero Interest Rate policy has created a boom in Interest Rate, which holds demand for the future, creating a tremendous amount of supply of commodity, such as oil, and all other commodities necessary to build what people thought was a Sustainable Growth rate, but it isnt. So zero Interest Rate policy by the Central Banks around the world is creating a global recession. For those who arent as smart as you, lets look at it this way, if theres easy money around for the very affluent, and they said a return, the money has to go somewhere. We see it goes in stocks, commodities, even like growing sassen eventually make a reality. What happened in the in are field with all that point. Wasnt that really the orphan of the government, but really one of the real growth areas out there. It just got punished by too many of a good thing. Does that cover it . In part. You have to remember the supply and demand. Wrestle in the United States and in europe antigrowth governments in place, refusing to let free markets work and create growth so when elf zero Interest Rates policy boosting supply and no increase in demand, what weve got is what weve got. So when you hear many say look at cpi, ppi, nothing to look at there, why adopt they ever point to whats going on in other areas as you just pointed out like the appreciation of Financial Assets like stocks . People dont listen for themselves. The fed is saying the economy is going to improve for foryears. You and i and jim have been said bond prices are going up. Next year i think well see one on the ten, two on the 30, absent some major shift which i cant see happening. Now, we do both agree on one thing. I dont disagree with the direction of Interest Rates, but i personally am sticking to the notion were going to close yields higher than we are today. You see a yearend bounce in equities, do you not . Theres a huge amount of cash valuable to buy stocks. Assuming there is no major bankruptcy, you know, financial dislocation uncovered in the next day or two. Huge amounts of buybacks, cash takeovers, lots of new money to chase fewer shares, we could have a major multiup in prices over the between now and the january, just based on supply and demand of the stock and money. Okay. And my final comment here, charles, i want you to expand on in the last 20 seconds, being a portfolio manager, what are the areas you would try to bottom fish here and what are the areas you would avoid . If i had an ongoing need to energy, i would look as some of the back months, maybe trying to lock this in. Is that the dynamic that will turn energy . Yes. Im not a pro in the energy areas. I have some friends who know what theyre doing, so i would follow them. What i would be buying here is we have a Global Broadband boom, and the leaders of that will grow regardless of what the economies do. Charles, thark you very much. If i dont i dont see you, have a happy holiday. Thank you. Simon, its all yours, as we continue to try to figure out exactly what the next chapter in this Energy Reversal is. Fascinating. False fating, rick. Thank you. Up next, this 17yearold High School Student claimed he had made 72 million trading stocks. Well, not exactly. Well have the inside story on that, after the break. How do you beat the number one seed . You just have to win 70 of your points at net. And keep unforced errors under 10 . On the ibm cloud, the us open analyzes 41 million data points from 8 years of competition to uncover key insights. Data can help show you how to win, no matter what business youre in. Today theres a new way to work. And its made with ibm. Thank you. Ordering chinese food is a very predictable experience. I order b14. I get b14. No surprises. Buying business internet, on the other hand, can be a roller coaster White Knuckle thrill ride. Youre promised one speed. But do you consistently get it . You do with comcast business. And often even more. Its reliable. Just like kung pao fish. Thank you, ping. Reliably fast internet starts at 89. 95 a month. Comcast business. Built for business. Welcome back to squawk on the street. Were watchi ining shares of cv health move sharply higher after it increased its dividend by 21 . And also announced a stock buyback and expects 2015 to be another year of growth. Shares up 4 and a half . And this is important. They are one of the biggest sellers of precipitation drugs in the u. S. Chen a 17yearold High School Student was reported to earn 7 million trading stocks. And turned out he made it all up. He was the first to report that the 72 million figure was not true. Weve all been high schoolers, all told fibs that got out of control. What what happened yesterday. Like everybody else we saw the article in new York Magazine and we were interested in how a High School Student was able to make this kind of money at only 17 years of age. We invited him out to cnbc for an interview on the halftime show yesterday. And like everybody else, of course, we were wondering whether this passed had smell test or not. So when he got out here. We asked him a number of typical questions that you would ask with an air of skepticism about it. If he could produce any Trading Statements she asked him what trades worked best for him. He couldnt say. He then went upstairs with his investing partner and talked to a couple of executives. And at the end of that meeting decided he didnt want to come on television. And i then met with with him. And at which time he told me the 72 million number was in fact not true. And we were just wondering, okay how you open a brokerage account under the age of 18 wrsmt did the initial sum of money come from that you could build that into 72 million. What is your biggest winner and just couldnt come up with anything. Admitted the number was false. And later on in the evening admitted to the new York Observer that the entire thing was in fact a fabrication. And they have a pr person working with them now and released this Statement Last night which is interesting. It says the new York Magazine article is inaccurate. While he runs an Investment Club which simulates trades, his millions are about as real at monopoly money. At the end of the day this teenage boy simply didnt realize the consequences of his actions. Everybody was talk about this over the last 24 hours wondering how it could even be possible that such a young guy could be doing this on his lunch break or whatever. And come one that some of money. Its amazing it got that far. When going to cnbc you have madge youre going to be asked about how it all happen pd. All though its new York Magazine who they cant really let this get out of control. They continued ed td t ed d the story. And then we found out there was nothing but monopoly style money at play here. And now you have an embarrassed 17yearold and a bunch of people asking questions about as you said the original story and how it even got this far in the first place. At lof tweets coming in, leave the kid alone. Which i think sums up how a lot of us feel. Yeah. Amazing 24 hours in that story. He is only 17. Lets send it over to jon fortt. Quite a show coming up for you. Live from moscow talk about the rup rupales collapse. And the Walt Isaacson talks about his big tech idea for 2015 and the cofounder of myspace talking about his efforts with gaming. All that and more coming up on squawk alley. Gentlemen, meet our new cloud expert. [speaking indecipherable irish] my names mccloud. Get your totty business onto the cloud. Its like hee haw. You cant even beat em. I didnt understand a word he said. Yes, the cloud is difficult to understand. Mccloud. But we already have a cloud expert, cdw. They provide comprehensive multivendor Cloud Solutions that reduce it costs and enable innovation. Mccloud just said that. Good morning, it is 8 00 a. M. At apple headquarters in cupertino california. 11 00 a. M. Here an wall street. Squawk alley is live. A special guest joining us this morning. Aspen institute ceo author of the innovators. Walter isaacson is here. Good to see you. Good to see you. What a day. Especially with what happened in russia overnight. The dow has flipped positive. Session low is down 99 and a third points. Currently up 80. Oil trying to make a run out of it. And a little more stability today. And i think that is the important thing were seeing. I want to show you sectors that have been horribly over sold in the last month or so. So any of the metal stocks have been dramatically over sold. They are bouncing today. Thene