That yield. Yield does go thats yield. Yield goes higher. Crude oil is the key to this market. Geez. I say that before my friend to the right of me says it. Wow. Were above 50, jim. Thats a move. Its for real. And that seems to be having a broad impact as you might expect on so many markets which we will get to as we start the road map this morning. Glencore higher in the premarket. It plans to cut production, but alcoa lower on weaker than expected results. Tesla gets a downgrade while elon musk lobs a put down at apple. Oh, yeah. A bit of a smackdown. And gap shares are down almost 8 in the early trading. That on declining samestore sales. Well, oil prices as we said, extending gains. Crude on track to post the largest weekly increase percentage wise in six years. Shares of glencore also up. That after the Company Announced plans to cut annual zinc production by a third. And alcoas falling after it posted weaker than expected quarterly results, in part due to lower aluminum prices. Last night on mad money, jim was told alcoas outlook has optimism. Our experts press injected a deficit for next year in aluminum. Then we have seen the stock price, whats in warehouses coming down to levels that are below the levels that we have seen before. I think there could be a lot of optimism in there. How much does alcoa predict what is going on . If alcoa is splitting into two different part, and then this upstream business, basical basically aluminum and balcite. Claus was saying this Aluminum Company that everyone seems to hate today, if it were separate, it would be like freeport, up 30 , 40 , if glencore is cutting back zinc. Were hearing rationalization to valet. Bhp and rio have had big weeks. He said this would be the pure commodity play would like. He said it is a welltimed split. Pure play aluminum we would love it because the quarter wasnt good. People think this is the trough, david. We hear trough in so many Different Minerals because the rationalization is coming in with glencore finally blinking in a zinc market thats so horrendous. If they blink you mentioned glencore. They announced a half 500,000 ton reduction of contained zi e metals mine production, main rain to preserve the reserves in the ground at a time of low zinc and lead prices, which does not correctly value the scarce nature of the resources. Glencore, you can see whats happened with that stock. Thats the adr. When you look at what has happened to it, it is up sharply over the last couple of weeks as they start to fight back after that 29 down day a week ago friday. This is important. Last monday. Two weekses a ago, you go of water cooler talk. I cant buy stocks because of this glencore. I cant buy stocks. Oil is going up. The real, which is one of the worst performing currencies, you and i should go to brazil and buy a couple mansions, the reale is strong. Relative strength in over a week or so . Im talking about two weeks ago you could only buy onesixth pack of pbr if you had a share of pbr, now you can buy two six packs. Thats facetious. The pbr is the same as my favorite beer pabst blue ribbon. People say the dollar is peaking worldwide against everything. You are hearing that. When cfos talk, one thing people will be saying is the dollar that peaked, our currency fx is not as big. Look at pepsico. We did not talk about the fact that they are saying the dollar that peaked. They have russia. The ruble has been good. Ruble strength is up since oil is up. A lot of this goes back to oil. Everything goes back to oil. Oil was the worst commodity in the third quarter. I was dealing with Oil Executives coming into town. The oil story theyre talking is not we only had a 5 decline in production in our country, theyre talking about a 20 to 30 production for next year. So is 50 here to stay . Nobody will be talking about 30 bucks anymore . In spring when the oil had the run up to the 60s, Companies Got faked up. Then it got brought down on the goldman call on the 30s. Theres been a lot of shut in. A lot of equipment taken out. For some time you were saying its not cut as much as you would have anticipated. In the last four weeks, the cutbacks have been amazing. You dont want to be in the Oil Pipeline Business either. Nat Gas Production is soaring. You dont want to be in any of those businesses. Nat gas you do because of the share take. All right. Coal. Williams ships a lot of nat gas. Not wanted on that stock. Now you do. Now you do. Over the last week i have wanted to. You have the deal i have done a massive amount of work with my friends at rbn about the Energy Transfer and williams, they will own the natural gas business. They will export 5 to 8 of our natural gas in this country. They need all the pipe they can get. But the oil pipes are running 50 full. The natural gas pipes are r running 100 full. If youre in the oil business, not so hot. If youre in the nat gas business, demand is everywhere. Were talking now about those that transport natural gas but also that produce is . This is coal. Where are we on this . Natural gas at a 15year low. Thank you. 2. 49. David, the utilities, coal, forget it. Its not going to be 2020. Its 2018. Coal is going out of production. If Hillary Clinton is elected, all the companies that think theyll be okay, the utilities, forget about it. Theyre going natural gas and renewab renewables. You still need baseline, baseline is coal and natural gas. General electric very levered to the switch to natural gas. General electric has had one of its best weeks in years. Number one performing industrial in this country. Ge closes yesterday at 28. 03. The secret started in the mid 24s. Can i tell that you nelson peltz and jieff immelt, its nelson peltz influences jeff immelt to buy more stock back. Thats why ge will be a good stock to own. Dont forget, 19 of this company is oil in china. Im not convinced yet that i like oil as a bottoming story. I like china as a bottoming story. Therefore people are playing ge as a way to bottom. Ge had another great week. That was the week think announced the decision to divest most assets of ge capital. It did not sustain. It did not sustain because of the price of oil and the lowdown in china you think its different this time . I think the Balance Sheet is different. I think its underlevered company and it wont be circumstances, siffy, it can buy back more stock than people think. Ge, i hope it comes in so people can get in. What a week weve had. This is the same week that Ellen Kullman was fired. It happened this week. Exactly. Its been an amazing week and its not over because tonight tonight, 9 45. We can watch the mets beat the dodgers. Jake that, jane wells. Lets talk about another west coast company. Tesla receiving another downgrade at barclays. They go to underweight from equal weight. The firm saying they see many challenges ahead for the electric carmaker especially in regard to the musk has taken a shot at apple when saying apple is hiring teslas engineers. He said they have hired people we have fired. We call apple the tesla graveyard. If you dont make it at tesla, you go work at apple. Im not kidding. The tesla graveyard. Getting crowded. You always talked about it being a cult stock. Barclays saying they dont know if they can ramp up the output. Did you see that piece. Reality check on margins, future stream and delivery. Model x yeah, the x launch reinforces three risks. But the wrong flow of data points. This piece is far more negative than people realize because theyre really talking about the production is going to be much lower. Big production miss. I dont know, david. Its a cult stock. Leave it like that. It is. Do you believe apple is a graveyard for tesla employees . It i they may have removed the head stones, but they didnt remove the bodies. I think that if anything, this is a poeltltergeist for apple. Everything growth has been horrendo horrendous. Look at google. Cant apple fall into its trading at 11 times earnings, but the source of funds for csx and union pacific, not for tesla. Go figure. Coal, coal is not coming back. Coal is not coming back. Coal is a bad story. Were talking about some positives here, all of this could come to a screeching halt when we talk about congress. Republican congressional leaders set to meet this morning to discuss the selection of a new speaker of the house after Majority Leader Kevin Mccarthy stunned the gop by dropping out of the race. Ohio congressman john boehner who is the speaker announced plans to retire at the end of this month. He says he will stay on as speaker until a replacement is found. Why is all of this important . Jim, i hate to say that on november 5th we have to have the debt ceiling raised. And then, by the way, in december were talking about the budget. And we could be facing an impasse again. Its hard to imagine. If boehner keeps the job through the end of the year, that seems a positive. Thats how i was looking at it, until you put the negative spin on it. But the turmoil in the fact that we dont have a speaker yet, mccarthy is not there. The idea that something could be more conservative than he is worries those who belief a shutdown is more likely. Shutdown does hurt earnings. I can show you shutdown would be bad. You have to scale back the international. Theres a lot travel. A lot has to be scaled back. United reported a good number. Would sell the airlines on a shutdown. We know that. So, no, we have to watch it again. Remember, it does get built in. By the time you get to the shutdown, the second day you have to buy the stocks. Daryl issa was a member on squawk box this morning. Lets hear what he said. Im considering whether or not to put my name in the hat. To be honest, i probably am better suited to be the republican leader or committee chairman. But thats not a question of suiting. At this point or even experience. Its a question of can we come together . Come together, we should get that button made . That again . It work well. Hey. Was what was it . Rise above . Rise above. My president bloomberg 2016 pin. I felt like wearing that last night. Do you . Second day in a row i listened to mayor bloomberg. I know. I saw your tweets. I thought i was day behind. Im talking him. I love to listen to him. This is not in the market. A shutdown is not in the market. Were oblivious to it in the market. So does endlessly buying the industrials. Fed lockhart, rate hike still likely. Where is bullard, hes sanguine. Those guys are what i call outlyers, but they love microphones. They walk a mile for a camera, those guys. With the 20pound pack i would be shaking. I would be shaking. They could come down and get me. Im right down here. Post nine. I was very peaceful. I was very sanguine about the whole interaction. I dont know. The wife didnt like the way i got a beat down. Really . Yeah, she want mess s me to her the wife already. We have two empty seats. The guy went to titan in 2007. Bullard can come sit next to us. Coming up, bad news on the gap, at least if you own the stock. Also ahead, an exclusive interview with new york fed president bill dudley as the Interest Rate debate rages on. Lets look at futures. We are back with squawk on the street after this quick break. [announcer] right now at sleep train, get up to 48 months interestfree financing on tempurpedic. Save 300 on beautyrest and posturepedic. Or choose 300 in free gifts with stearns foster. The triple choice sale ends soon at sleep train. Gap shares are falling in the premarket. The retailer reporting comps down 1 in september, hurt by a 10 decline at banana republic. Comps at old navy up 4 . But the head of that division is leaving to become the ceo of ralph lauren. That will take place next month. Gap got crushed when that was announced. Did you see what art peck said . No. He said that he blamed poor fitting womens clothing. Poor fitting. Not the women. Disappointing womens product. Banana republic, it doesnt fit well. Its not flattering. Do you want to have your wife shop at a place where the ceo says dont buy our clothes, theyre not flattering. Thats when that fella, who ran Abercrombie Fitch didnt wasnt any people overweight go to his stores. Jeffries. These are things you dont say. My clothes are illfitting. The stock, which frankly was in the mid 40s in the spring or close to the spring, is obviously down sharply from there. We talk a lot about the mixed picture in retail. Yes. You cannot paint it with one brush. You cannot also invest across the sector and expect the same results. Well this is yet another indication of that. Elle brands, those numbers were extraordinary. Costco, 8 comp. A lot of good little chatter about retail. Jcpenney, ralph lauren, since the Management Change up 20 points. Then the illfitting guy. Youre giving positives, but there are plenty of negatives. Its not just gap. No, its a mixed picture. I dont think cokohls is readyo move. I think nordstrom is. I dont think you can say illfitting clothes, and say the clothes are illfitting, down 40 , ill go look bad. What do you do. Fire some people. Theres ways you can turn it around. I dont want to fall into the stock by any means. By the way i got that. Ascena shows you what happens if you stick around long enough. David jaffey comes on money all the time, hasnt been doing well, then golden gate bridges the gap there. You got them all. 9 stake in Ascena Retail group. Golden gate capital is what jim is referring to they own the dress barn, lane bryant. Yeah. They own maurice. Ann taylor. I think that ascena is very undervalued, they made a series of acquisitions that have not worked out. They also had style issues with justice, a division of theirs. Not the department of justice, but it sells as many clothes as the department of justice. They need a shakeup there. David jaffey has tried but youre not a midnight toeker, are you . Excuse me . You said youre maurice. No this is not the steve miller band. This is the david jaffey band. Got it. Were going to have cramers mad dash coming up next as we count down to the opening bell on this friday. Its been quite a week. Were not done yet. By the way, joining us is new york fed president , bill dudley, he speaks to steve liesman, thats an exclusive interview coming up shortly. Were right back on squawk on the street. [engine revving] a 401 k is the most sound way to go. Lets talk asset allocation. Sure. You seem knowledgeable, professional. Would you trust me as your Financial Advisor . I would. I would indeed. Well, lets be clear here. Im actually a dj. [ dance music plays ] [laughs] no way i have no Financial Experience at all. That really is you . If theyre not a cfp pro, you just dont know. Find a certified Financial Planner professional whos thoroughly vetted at letsmakeaplan. Org. Cfp work with the highest standard. Some people call me the space cowboy some call me the gangster of love some people call me maurice there it is. All right. Maurice numbers, samestore sale numbers not that good. Steve miller made up the word pomptous. Still not in the dictionary. We have a mad dash. Where are we headed . One of the worst performing retailers, talking about walmart. Trying to make a change. Yields 2. 93. Has a little protection. Changed at the top. Cfo, what does that mean . Cfo, an important position in what is one of the Largest Companies in the world. I can remember a few of them through the year the. They are very important and help to drive sort of the financial direction of the company. That said, Doug Mcmillan obviously firmly in control as he tries to wrestle this thing to the ground and bring significant change. Well see. Its been tough. 59yearold mr. Holly stepping away at the end of the year for a younger gentleman who will be taking over as cfo. Walmart challenged like amazon. Amazon may dispute the numbers that came out from anchannel advisory. In other words, that amazon will get a boost. I regard amazon as the real enemy of walmart. Walmart likes to order and pick up. I dont think the order and pick up has the attraction. We want to order and have it come to our house. Yeah. Sometime now in the same day. I had that happen. I got sameday. I got sameday household, toiletries. How did that happen . More coming up. patrick 1 whats it like to be the boss of you . patrick 2 pretty great. patrick 1 how about a 10 raise . patrick 2 how about 20 . patrick 1 how about done . patrick 2 thats the kind of control i like. And thats what they give me at national car rental. I can choose any car in the aisle i want without having to ask anyone. Who better to be the boss of you. patrick 1 than me. I mean, you. Us. vo go national. Go like a pro. He can not see through doors. His speed, anything but superhuman. But when it comes to health care options, george found helpful information and resources at aarphealth. Com this makes him feel unstoppable. Well, almost unstoppable. Discover real possibilities at aarphealth. Com today and tomorrow take on the world. All right. There it is. The applause building for this friday as we close out the week. We have the opening bell about to ring on the new york stock exchange. The realtime exchange about to compose itself. Hopefully end up with a few more green. At the big board, by the way, Kennedy Wilson holdings, a Real Estate Investment and services company. At the nasdaq, it was cpi card group. Thats a provider of credit cards and debit cards celebrating its ipo. They do the chip on the card. They went they were going to price between 16 and 18 in september. Then they lowered it to 12 or 13 on wednesday. Then it was delayed. Then they priced last night at 10. Holy cow. On the eve of first data and albertsons, 10. Wow. Had to get the deal done that badly. Had to get it done. The market is so overbought. Money is plowing into the boeings of the world, but they do not want to touch this new merchandise. First data is probably the thing to watch. A large offering, of course. Having been an enormous lbo from quite some time back. Its aged. Its time now for it to be public again. Kkr behind that. They brought in a new ceo. What are you hearing. Well see. This is not the greatest ipo market. This is the strongest for the s p this year. The worst ipo market of the year. What is that saying . People want value. That means if youre going to do value, lower the price of some of these offering. Earlier this week, a company i liked very much. Against emc, but its a growth stock. People, david if you looked between 215 and 230 the futures went up big. Once the futures were up to 230, sellers were turned to the growth stocks. Other than netflix where they put through the dollar price increase. The rest of them, google could not catch a break yesterday. The biotechs barely turned. They dont like growth. They like value. Unless first data price first data, do the buyers a favor and price this lower. They want to get this thing out. Theyve been waiting so many years to try to start to monetize, not that theyre back to break even yet. Im not sure they are at kkr. The company is doing well. Company is doing fine. I know theyll say why didnt you mention were doing well. Im talking about the pricing. Right now people would rather own freeport because betting that theres disciplined return after glencore, then they want to own first data. Probably at kkr saying this is incredible how out of favor the whole whether its the biotechsthe techs in the ipo market, theyre horrible. Or as you say growth. Yesterday you and i sat and talked about ebay, which was down as much as 8 at one point. Not a rebound today. We were talking about walmart and amazon, that stock getting crushed yesterday as a result of this same service. You asked me how accurate it is. Its good for one part, but the Amazon Web Services people like at am s at amazon. Im concerned about the ipo market it says that the regular market is overbought but theres no new money coming in. Its overbought with rotation out of high growth. Did you see skyworks yesterday . No. Skyworks up for the year. Avago down again. They were the ones to love, cell phones. What do they love now . Pc tech. What is that about . Skyworks has not done well since saying they would acquire pcm sierra. The down performance has been the 5 qacquire of a stock. When that turns, you cant argue that its turned completely at this point, but it was that dialogue deal, it was ete for williams, those folks, to be fair, have been up sharply. Thats because of yield. This deal. Theres been a number of them. Were not seeing that premium be afforded the acquiring stock price that could have a negative effect in terms of more deals. David aldridge came on mad money. In that announcement when he bought pcm sierra, the stock has gone down, down, down. Avago, the inquisitors tried to put in a down point. They are all doing badly. What do people want . They want huntsman chemical. At least for now. Yeah. What happens, watch alcoa. Thats the key to the market. Alcoa did report a bad quarter. The stock was down badly. Now stock going down. I think you have to watch the metals. The glencore news today about the zichnc, thats so good for vale. Are you saying something positive about vale . You have to get real about the reale. I will focus on getting real about that. Why . Israeliing. Are they out of the woods . No, but petrobas and glencore kept me up at night, now netflix keeps me up at night. Did you see the story in the New York Times . 1. 04, drops to 1. 02, can you imagine the stock up 12 points off a dollar increase . No sense at all they would do this. There is no david, you pay 15 a month if you got to watch narcos. I might. I might. I was at best buy last week. None of the guys have tvs. What do they have . 65 million members. At netflix. A lot of money. Look what are their programming coasts . How much of this is a result of them being able to pay that bill . 4 billion, 5 billion. David, they know i asked about narcos, im talking about a show that i think everyone should be watching. I need some good recommendations. Narcos. An algorhythmic show based on breaking bad and scar face. They do tv where you dont have to worry about sponsors. You can do a darker form of tv. A form of tv more like real life it doesnt end with the Big Bang Theory what is that. I dont know. They are great shows, some of them. We dont know how popular they are because they dont share those numbers. No, but crouching tiger hidden dragon ii is coming out in china. They could spend a fortune on marco polo and tell everybody it did well. It did well you dont know. Youre just listening to them what does well mean . Who am i supposed to listen to . We spent a billion dollars to buy it. Who am i supposed to listen to from netflix other than netflix . Are you going to bet against Reid Hastings . No. They could just say it did well. Theyre not giving you numbers. Thats true. Thank you. Im going to take that and run with it. Mary thompson is on the floor. Shes got more on whats moving. Modest gains for the markets on the heels of yesterdays Late Afternoon rally based on the dovish notes from the last fed meeting. Right now the dow jones is up 31 points. We want to look at energy. This is expected to be a factor in the gains today. We have oil above 50 a barrel. As you can see, energy seconds tending its rally this week. Its the best performing sector this week, which is very strong week for the markets. Up over 8 . Again, adding modestly to those gains right now. Materials expected benefit. You heard jim talking about it. Glencore cutting production of zinc. Materials has been the second best performing zesector within the s p 500 this week. Drug stocks remain under pressure this morning. This is the worst performing sector this week. Down again right now. Overall the dow is up 3 this week. The s p 500 expected to post its best Weekly Performance since october of 2014. The nasdaq again, because of the concerns about the biotech area, has been the weakest performer. Though still up 2 . Look at the russell. Up over 4 this week. Extending their gains in early trading, up about just over a point now. But its close to exiting the correction. Its still down over call it 10. 2 from its alltime high. Quickly want to check on the transports. They had a big move yesterday. Theyre extending that move today. Despite Higher Oil Prices expected to get a lift from ual, united airlines, raising the forecast in large part because of the credit card deal. Up just about 0. 9 . Very strong week for the dow jones transports. Their best week since october of 2012. Right now the dow is up 44 points. David, back to you. Thank you very much, mary thompson. Want to update a couple deals im following closely led by beer. We are moving closer to the put up or shut up deadline which will be next wednesday at noon here in the states for sab to say, okay, abi, were willing to talk to you. Therefore we will extend this deadline or the possibility that it will not be extended and that abi will essentially go away with its current proposal to acquire sab in what would be a 1 104 billion deal involving broad divestitures around the globe. Today carlos brito is in new york meeting with investors, trying to tell them about the merits of the transaction and the synergies brought to bear as a result of it. For its part, yes, this morning, sab increased its own coast savisav cost savings, not on a deal, but on their own. Some analysts are saying that was already in our numbers. We anticipated significant increase in cost savings at sab is it can be viewed a couple ways. It can be viewed as a negative saying they are undertaking things they believe will be showing more value or saying, come on, were worth more, but thats all theyre doing. Its a high stakes negotiation, anybody can you can figure out what odds are that they will get something done. As i pointed out in my first reports on this potential deal, one of the keys of the Santo Domingo family, led by alejandro Santo Domingo. Others have focused on that in the press. At every opportunity abi is out there saying investors of sab, please, pressure them. We may not have that much more money left. Please, pressure them. Brito will be saying the same thing today. Altria has been going up, which is my tell on whether this things can happen. Altria has been incredibly strong stock. Not op cigarette growth, but that additional money that would come their way. More buyback. Finally, i did want to also hit emc. We talked about it a great deal yesterday as we shared the details of a potential deal under which dell would buy the company. He emc stock up a bit today. The deal is above 27. The question is how much and what the composition of said deal would be. As i reported yesterday, it would rely enormously on the credit markets to complete this deal. Dell would have to borrow at least 40 billion in the credit markets, have 50 billion plus in debt on its own Balance Sheet. The leverage ratios, you can work them out. Its not crazy. It gets up there. Maybe four times or so, but not beyond the pale. That said, its asking a lot of the credit markets. Even with this idea of hybrid approach. Right now theyre still working on the credit market side of this. People familiar with the situation tell me they have not gotten it locked up on the credit markets yet and the debt they would need. Still negotiating. One thing is i can share is vm ware. Dell intends to maintain control of that company. But there is the expectation they can use some of that 80 , 81 stake and spin some of it off to Share Holders as part of the consideration for your emc shares, so you would get some number in cash, and certain amount in vmware stock, which would be done potentially in a taxfree manner. If dell were to simply buy it and sell vmware shares, thats not a tax efficient way to do it. This might be. So this deal might be largely cash and this stub of vmware given to emc shareholders, all of which they hope will combine to a price where they will say, okay. You dont want the traditional array business of emc, the storage business what about the offshore cash . Bid could go much higher. Its not clear they can access that cash in an effective manner. I never put it pass a lot of these tax lawyers to figure out ways go about doing it, but that does not seem to be part of what theyre aiming for. You can borrow against it, thats helpful. This is one where i was telling people on mad money that i feel the upside is complete on emc, but you tell me there could be more. We will see. If you end up with a deal worth 30, 31, do Share Holders of emc say thats enough . What does elliott say . They are only a 2 holder, but they can agitate. I dont have all the answers. As we didnt yesterday. But this is still moving ahead. We may see something sooner rather than later. This is one where it did help the valuations of others, hewlettpackard, jim stewart with the evaluation of hewlettpackard. A lot of chatter that microsoft is reigniting the pc world. When i spent time out at microsoft, there is great enthusiasm for the surface. The surface. Surface . The surface. The surface okay. Lets get to Rick Santelli now in chicago. Good morning. There were a lot of investor and trading questions and issues after yesterdays minutes. The way the market behaved, the way the dollar behaved. If you look at an intraday of tens, unchanged up. Twoday you can see we firmed up dramatically. Up 11 basis points on the week. 12, by the way. Settled at 199. Another issue traders had yesterday was that if this was catalyst by the feds minutes, why didnt the dollar act weaker . It dropped yesterday. On the intraday, its the twoday chart what happened after yesterday, late in the day, last night has given it momentum. Theres an easy answer here. Its not only the fed, its the fed, the effects on the dollar, and the commodity cycle may be bottoming because if you go back to the last time the crb was at this level, which was the end of july, and you overlay a tenyear note yield, all of a sundadden,e issue dragging it up is the commodity situation. Peter bookfare has written grit pieces on this. Its more about the recalibration of supply. Free markets are still wonderful. Can you imagine if governments were trying to tinker with this . Theyre making adjustments, commodities, suppliers, growers, theyre all making adjustments here. Now well get a better demand picture. David faber, back to you. Thank you very much, Rick Santelli. It was nine years ago today that google agreed to buy youtube. At the time the companys largest acquisition. What does the future hold for youtube rival vinheo. And a onetime publicist for steve jobs is portrayed in the new movie. We will talk were Andy Cunningham about what it was like to work with jobs. Awe believe active management can protect capital long term. Active management can tap global insights. Active management can take calculated risks. Active management can seek to outperform. Because active Investment Management isnt reactive. Its active. Thats the power of active management. Prge a manufacturer. Well thats why i dug this out for you. Its your grandpappys hammer and he would have wanted you to have it. It meant a lot to him. Yes, ge makes powerful machines. But ill be writing the code that will allow those machines to share information with each other. Ill be changing the way the world works. interrupting you cant pick it up, can you . Go ahead. He cant lift the hammer. Its okay though youre going to change the world. Dentist appointment when my teeth are ready . Can it tell the doctor how long you have to wear this thing . 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 . Steve jobs, the movie, opens today. Reviews mostly positive a favorable 91 rating on rotten tomatoes. Some reviews, the best thing about steve jobs, the thing that makes it work is both tribute and critique is how messy it is. Peter travers, fassbender gives a towering performance of savage wit and limele leimitless firep. All right. Stock doing well. Disney coming back as well. Cost cutting concerns which were hitting all of media hard have abated a bit. They dont know cufocus on broadband. Stop trading with jim after this. It lets you trade stocks, options, futures. Even advanced orders. And it offers more charts than a lot of the other competitors do in desktop. You work so late. I guess you dont see your family very much . I see them all the time. Did you finish your derivative pricing model, honey . For all the confidence you need. Td ameritrade. You got this. Bob dylan. To improve my language skills, ive read all of your lyrics. Youve read all of my lyrics . I can read 800 million pages per second. Thats fast. My Analysis Shows your major themes are that time passes. And love fades. That sounds about right. I have never known love. Maybe we should write a song together. I can sing. You can sing . Do be bop. Be bop do. Do be do be do. Do do do be do. Im a senior Field Technician for pg e here in san jose. Pg e is using new technology to improve our system, replacing pipelines throughout the city of san jose, to provide safe and reliable services. Raising a family here in the city of san jose has been a wonderful experience. My oldest son now works for pg e. When i do get a chance, an opportunity to work with him, its always a pleasure. I love my job and i care about the work i do. I know how hard our crews work for our customers. I want them to know that they do have a safe and reliable system. Together, were building a better california. With jim. Theres so much to talk about, whether its the gravitas of the eli lilly upgrade today. Probably the cheapest of the big pharmas. International paper cutting back, discipline on the supply side. Last night on mad money, dominos is not yum. Look. Listen to me on this. Pizza hut down huge in india. Up big in india is big for dominos because they have a vegetarian pizza. The fact the costs of making pizza is down and revenues do not worry about supply chain. Did he explain the franchise question . Yes. Why it was not it had do with the fact that when food costs come down, they get a vig. But it does hurt the revenue, but not the bottom line. I like dominos here. I think theres theres a big bond deal theyre doing. 900 million theyre freeing up. We did not talk about that. Look at the capital structure of dominos. Its happening now. I would not seldom knl dominos. I still dont have conviction on yum. Stay away. I order via emoji for dominos. Banana peppers. Extraordinarily good. Got it. What do we have on mad tonight. Im reviewing all of these ipos. It will be the coliseum of ipos. Whats already been whats coming or . One that has happened and im giving you a preview. Some of these deals, well be talking about these deals. Next week is big earnings season but also ipo season. If the ipos dont do well, your market wont do well. That means no more cash coming in lets stay focused on commodity producers, on whether biotech can bounce and what happens to the rollups. Beautiful. Good luck tonight. Thank you. Well need it. Well need it against mr. Kershaw. Coming up, an exclusive interview with new york fed president bill dudley. We all know that directvs better at this whole tv thing. So, to beat them, were gonna get bigger. Were gonna merge with cableworld. exec 1 cableworld . I cant stand those guys. exec 2 theyre the worst. exec 3 theyre totally incompetent. exec 4 that company stinks and i mean they smell. I used to work there. I had to breathe through my mouth the whole time. cole shh, shh, shh, theyre here. newhart this is gonna be fun, firing everyone. vo get rid of cable and switch to directv. Call 1800directv. Good morning, welcome to squawk on the street, im david faber along with sara eisen and simon hobbs. Carl hat day off today. Lets give you a look at markets and oil, which seems to be such an important component of all the markets. Certainly adding to what has been a good week for the broader equity markets. We continue that trend thus far early in the session. Lets get to Rick Santelli with breaking news on wholesale trade. Rick . Yes. Wholesale inventories and sales for august, which means spot in the middle of the third quarter, last quarter, up 0. 1 on inventories. Last month it was down 0. 1. The first minus number since may of 2013. It is a positive read and better than expectations. Could have some subtle, subtle changes to the gdp, considering the revision to july, it will be taking away based on that alone. Sales were down 1 . This is a surprise. Much more than double what we were expecting. Last month unrevised down 0. 3. So inventories, well, important. But you need to move the inventories and the sales number is not pushing it in that direction. Simon, back to you. Thank you very much. So the market is managing to hold gains. In less than two weeks, the s p has gained 7 that cuts the loss year to date to just 2 . Jason pirdy and Michael Hanson join us now. Jason this is a strong rally we have here. You know, it is. But so the circumstances that were having is the market is trying to decide between whether this correction we recently experienced is one that will be associated with a recession or one thats not. Theres a dramatic divergence in where there is a perceived scare, and then the economy and markets figure out were not in as dad of shape as what could have possibly been. In those scenarios the market tends to find its way on average back to the previous highs within seven months. It seems like were ahead of track based on the markets path. Jason, just help us understand exactly whats happened over the past two weeks. You will be aware, because its got traction today, that bank of america has a note out where theyre noting that 53 billion has gone into money market funds, cash. The conclusion from that, they say, is that this is pure and simply a shortcovering rally. That may be preempttive to what youre talking about, but thats where we are. This is a shortcovering rally, isnt it . Its no surprise when you have a 10 market drop that you have a fall off in sentiment and a pick up in conservativism by investors. That partially creates that 10 move and what is the aftermath of the reaction in the markets. Thats a normal environment. In terms of what has been happening, people are really trying to die just two primary pieces of information. One is the impact that the energy drop and decline in that sector is having on the global economy. And the second piece, which is probably bigger in peoples minds is what exactly is the impact that chinas manufacturing slowdown is having as it filters through. The imf made an interesting Statement Last week. Christine lagard coming out saying the numbers for this year and next year are at risk. There are estimates that it could be 0. 5 sit from the chinese situation. Our take is were still in a growth environment. You have that hit coming through. Okay. That magnitude seems about right to us. And investors should be using this as an opportunity to buy in the middle of a longer Term Economic expansion. Let me show you one place theyre buying. An ipo has just opened on the nasdaq. The company is cpi card group, a provider of credit and debit cards. Its soaring. Up 19 . It lowered its ipo price to 10 per share on thursday. It set a range between 16 and 18 in september. Keep in mind, this is somewhat of a bumpy of an ipo market with purestorage coming out of the gate lower. This is up higher now 23 for cpi card group. I wonder if its a sign that, you know, in slow growth environments, when these ipos are hot and investors like them, they soar. In the nearterm, theres a bit of a concern of growth. Third quarter growth in the u. S. Will be relatively soft. It looks like some very significant drag on the trade side. And also that inventory correction discussed earlier. If look through to time domestic demand, its doing well. With the lag, that should be supported for some more cap expending down the road. Were not seeing it now. Thats a Glass Half Full attitude it may be perfectly correct, but lets not forget where we are on this rally. This rally is predicated on a soft jobs number we had out in the employment report and the idea that the fed dare not raise Interest Rates until next year. Theres a survey out today that suggests the risk of recession in this country over the next 12 months has risen to 15 . Its an indication of the fear that people have of where the economy is going. What would you say to that . Theres obviously some risk of recession out there at any given point in time. Its not especially high. This is a recovery thats had a very slow build. Im not sure were on the verge of a downtown. Fed Officials Say they think things are good enough to support as have to communicate why they think that, why they think the economy can handle a rate hike and we have a couple months before they can make that decision. Ultimately, as barclays put it, it may be because unemployment plunges. On the basis that were rallying, what is the best idea now . I would probably point out a couple different areas. Number one, for those both of these are for those willing to take a bit more risk right now in their portfolios. One area i think is International Developed markets, european and japan. Those areas still are the cheapest of the global sectors. Theyre sometimes not as good of companies as those in the u. S. But the valuation discount there is still pretty monstrous. Thats an interesting opportunity. In the u. S. , i would probably argue that youre quality side of the equation, your side of the investment argument where you have stable business models, high profit margins, those companies in a lot of cases have been hit quite as hard as the broad market. And in many cases youre getting a longterm investment return that works really well in a low growth, low Economic Growth environment. Thank you both for your analysis. Jason pride and Michael Hanson. One of the standout force this week is the move on oil. Jackie deangelis has more. What has been thought of as a potential break out for oil has more legs now. Several assaults on that critical 50 level. We have broken through but not able to close over that level. Traders tell me we will keep testing it until we close and hold. The intraday high, 50. 92, now trading slightly under the 50 level. Geopolitics slightly back in focus. You cannot dismiss russias involvement in syria now. Being viewed as an alliance with iran, joining power and aligning forces within the region. Speculation occurring that saudi arabia may have to prepare a counter offensive here. Saudi arabia has said assad must go. And this really is not about syria as an Oil Producing region. They dont produce oil, but its about influence in the region. Weve seen this before when it comes to wars. Prices of oils have shot up. It is something to watch. You have goldman out yesterday reiterating its bearish call on oil, going back to the fundament fundamentals. Traders tell me if Something Like this escalates, all bets are off. S P Energy Sector up nearly 8 for the week. Up next, the race for speaker of the house is heating up. Congressman darrell issa thinking of throwing his hat in the ring. Larry kudlow will be joining us live at post nine to weigh in on the congressional chaos. Squawk on the street will be right back. Care of my heart. Thats why i take meta. Meta is clinically proven to help lower cholesterol. Try meta today. And for a tasty heart healthy snack, try a meta health bar. House republicans are meeting on capitol hill this hour. The republican conference is in chaos after Majority Leader Kevin Mccarthy dropped out of the speakers race who will step up to unite the party . We have the perfect guest on this, cnbcs senior contributor, larry kudlow. Thank so you much. Thank you. Are you hoping that paul ryan will be pressured into taking this . Paul is an old friend. Oddly enough i was speaking to him on wednesday, i was interviewing him before the mccarthy thing. I was talking to him about tax reform, then this story broke. He would be good. He would be a unifier. Its up to him. Sounds like its up to his wife. May be. Hes got kids. You could be on the road 150 days a year if youre speaker. For a guy with a family, thats a grueling thing. He would be a great unifier, but hes not only one that could do it. Who else do you have your eye on . I have a couple. Not everybody will agree with me. Heres the thought. I want the leadership to be a coalition. All right . I want people from the conservative wing, from the moderate conservatives and so forth. For example, i would like to see jim jordan of ohio in the leadership. Maybe not speaker. Is good speaker who could unify the caucus, peter roscom from the suburbs of chicago. Very good lines to all the different factions. Formally a deputy whip. Those are a couple. Lots of names out there that could do the job. Let me say this, im more interested in the policies. You know we have ftax reform, budget caps. Dead lines coming up. The policies are important. I dont think the public is as tuned in to the speakership as we are. And i think a year from now its not going to be an issue what will be an issue is whether we get a 15 Corporate Tax, which is what i want. More immediately the party appears to be in turmoil. If you look at whats being written in the journal, maybe paul ryan is the only man who can save the gop now. You and i touched on this when we spoke about shutting the government down. Whether you crusade passionately and angrily for the unadulterate ed principled conservatives or you sit back and say how can we win the middle ground in an environment where donald trump is doing exceptionally well, it would ahere shgppeaappear, is g disturbing . That donald trump is ahead . Yeah. Dont you have to get the white house at some point . Yes, i think you do its early, simon, for that. You have to win the primary first. Donald trump, who is a friend. You probably know him. Ive interviewed him many, many times. He has great Corporate Tax plan. I just want to say that terrific. The overall plan itself some question on whether its anything but, you know, would be revenue negative not revenue neutral. I know from where you come from, the club for growth im the wrong guy to talk about that. We dont need to go down that road. Just to finish the donald point. I dont agree with him about mass deportation. I dont want trade wars with china i do have my differences with donald. On this point here, simon, in perspective we have to cover this. Its an important event. Its not, in my opinion, truly a National Interns emergency. If the government gets shutdown, if we have a holdout over the debt ceiling, which looks unlikely so our first deadline is october 29th with the highway funding. Let me comment. Myself i dont get excited about a threeday budget shutdown. I dont care. Republicans have done that. Democrats have done that. However, im very much opposed to any expiration of the debt ceiling which would be a Global Economic event. You wont remember this, but four years ago on the air i had a knock em down drag em out fight with eric cant tor. I do remember that. I said no way, dont go there. Thats an issue. But i want the party to be much more aggressive and use something called reconciliation in the senate, a budget and tax process. You only need 51 votes, not 606789 you can keep the caps on the budget go to a 15 Corporate Tax rate, which would stimulate the economy. Im waiting for the republicans to do a lot of things they didnt do after they won a year ago. Thats why this revolt is happening. Youre talking about Corporate Tax reform as if its a realistic thing that might happen. Theres no chance this congress is passing a Corporate Tax reform. Thats not where the anger is coming from. The anger is that theyre not blocking the democrats sufficientl sufficiently. The anger is they have not fully fulfilled their promises and passed a bunch of bills and put it on the president s desk. Mr. Ryan, as we talk, or at least before yesterday, was preparing for a reconciliation bill that would essentially repeal obama care. Thats in tow. Corporate tax reform theyre slow on. This budget issue this socalled sequester caps is a huge issue. The xm bank is a huge issue. Policy is very important here. And thats what the fight is over in effect. Why does nobody want to be speaker . Everybody wants to be president. Doesnt pay that well. Thats number one. Youre on the road 150 i think somebody told me john boehner was on the road 195 days. You know what . Youre a manager. You have to keep everybody happy. Its not so easy. The right is seeking to stack their own people in other committees to make the job of speaker hard. I want the rights to have representation in the leadership position. I do. A friend of mine interviewed him a million time, jim jordan, i want him to be in the leadership. European style, british style, you need to build a coalition. They got do that in this battle, however it works out. They have to have people in there and get along and try to work things out. Its great fun. Great drama, but i agree with you, david faber, do not mess with the debt ceiling. Thats the one thing i think is off limits. November 5th, its approaching. It will go you know, theyll keep it going for months after that. Not necessarily months. They play things tight in treasury. In terms of what is coming in and out. Gold is rising. I think its all about the debt ceiling. I dont like that part. Please, may i have, simon, i appeal to you directly, i want a 15 Corporate Tax rate. China is 25 . I want 15 . It will create millions of jobs. Could you organize a speaker of the house before we get to that stage . Yeah, i reckon so. Thats kind of a stepping stone. I will work on it all the rest of today. Thanks, larry. Always good to talk to you about this. Larry kudlow. Be sure to tune in to cnbc october 28th for the republican president ial debate moderated by our own carl quintanilla, becky quick, larry kudlow will be there. There will be talk of Corporate Tax reform. Coming up, the last six months have not been kind to am shares, falling about 13 . Gene munster says there is a certain trend that will provide a big upward tailwind for the stock. More on that when we come back. Proud of you, son. Ge a manufacturer. Well thats why i dug this out for you. Its your grandpappys hammer and he would have wanted you to have it. It meant a lot to him. Yes, ge makes powerful machines. But ill be writing the code that will allow those machines to share information with each other. Ill be changing the way the world works. interrupting you cant pick it up, can you . Go ahead. He cant lift the hammer. Its okay though youre going to change the world. Welcome back to squawk on the street. Check out shares of solar winds, an Enterprise Technology and Data Management company. Stocks spiking up about 10 , thats on a reuters story that the company may be looking to sell itself to possibly private equity buyers. It may be shopping itself around. This according to a reuters report. That is causing shares to move higher. Solarwinds, it is an Enterprise Technology company. Up because of those reuters headlines. Well keep an eye on them. We should say its traded, again, a huge amount of shares right now, well eclipsing its average daily volume over the past three months. Would apple stock do the same . Apple investors divided about how far the stock will react to a faster potentially iphone upgrade cycle. Optimists predicting 40 more upgrade in the stock. Gene munster is managing director and Senior Research analyst from piper jaffray. He joins us from minneapolis. The issue here is the rollout now across the country of these upgrade programs, be them from apple, or from the telecom providers. Talk about whats happening and why you believe its a game changer for apple. Well, theyre basically compressing the time it is to upgrade. Right now the average consumer upgrades every 22 months. The carriers are looking in consumers to upgrade on an annual basis. So that incentive will get people to upgrade phones more which could have a profound impact on apples numbers. Just to rewind a year ago when you bought your i phone you bought it on a subsidized basis, which was every two years. Today we estimate that about 95 of iphone users are going to buy with the option to upgrade annually. Thats a big deal. A significant change to how people are buying iphones and can have a profound impact on apples overall business. Yeah. You call the stock up to 172, which would be over 50 from where we are now. The naysayers like abby lander are suggesting that our conversations with users indicate the upgrade cycle will remain at about two years. They call the stock at 125. There lies the discrepancy where what happens when people can pay this monthly fee to upgrade at the end of the year. Theyll emphasize that debate, how often people upgrade. If people are paying for the option to upgrade annually and are getting that as part of the contact, we think that 75 of people will take them up on that option. Ultimately everyone should take their carriers up on that option. Were a big believer that this will have an impact in terms of compressing and speeding up the pace at which people upgrade phones. There is Research Showing that sales of the apple mac line is slowing, arguably outperforming pcs, but still within the ecosystem of apple, a disappointment. How does that impact the stock . We know the bulk of the money is made from iphones. You said it right there. The mac right now is about 9 of total revenue. 8 of total profit. To get the stock right is to get the iphone right. This topic of how fast people will upgrade is more critical than the mac. Do you think, gene, wall street has it wrong. The dow sis up 3. 5 , apple has barely moved. The simple answer is i think they do have it wrong. Its hard to imagine a stock hyper scrutinized like apple for that many investors to be missing the point. At the end of the day, the scycles tend to be nervous periods for investors to wonder how the growth will be after this great sixth cycle. That concern has really clouded the ability to look at whats underlying and whats going on and what is really going on is that people are standardized on the iphone. Theyre gaining market share. And theyre upgrading their phones faster. So we think when they report the quarter on october 27th the lights will start to go on for investors that something bigger is going on here. One of the bigger questions is whether they launch the apple car on to the market. Did you see what elon musk has been suggesting . That apple is a tesla graveyard where failed employees go to work. He said they hire people we fire. If you dont make it at tesla, you go to apple. Im not kidding. Just rhetoric . Theres always talk that apple will buy tesla. I think that got a bit more of a long shot today based on those comments. But that said, the car opportunity is a big opportunity for tesla and apple. If apple can replicate bmw, that would add 135 billion to apples revenue. You really are a bull. Gene, good to talk to you. Gene munster joining us. When we come back, Carly Fiorina has been frequently called one of techs worst ceos but jim stewart takes a different look at that title. He will look into her record and will tell us all about it when we come back. Wow hi watson. Annabelle, your birthday is tomorrow. Im turning seven. What did you ask for . A princess. And a pony. You like things that begin with p. I like pink frosting too. Will you have a cake . Yeah. I was too sick to have one last year. The data your doctor shared shows you are healthy. Are you a doctor . No. I help doctors identify cancer treatments. I want to be a doctor someday. I can help with that too. Watson, i like you. At ally bank no branches equalsits a fact. Kind of like mute buttons equal danger. That sound good . Not being on this phone call sounds good. Its not muted. Was that you jason . It was geoffrey it was jason. It couldve been brenda. Good morning. Im sue herera, here is your cnbc news update. The Obama Administration has ended the pentagons 500 Million Program to train and equip syrian rebels. The defense secretary meeting his counterpart in london said he wasnt happy with the early efforts and results. One person is dead, three injured after an Early Morning fight between two groups of students led to a shooting at Northern Arizona university. It happened outside a student dorm. The suspect is 18yearold steven jones who is in police custody. A Democracy Group has won this years Nobel Peace Prize for its decisive contribution to building a pluralistic democracy in tunisia. Tunisias young and shaky democracy suffered two extremist attacks this year in which 60 people were killed. The California Coastal commission approving a plan by seaworld san diego to expand its killer whale tanks. Hundreds of Animal Welfare activists protested that plan. The approval comes with the provision that no new whales from the wild will be kept there. Thats your cnbc news update. Back to you, david. Thank you very much. Gop frontrunner donald trump has been anything but shy about attack his opponents. Former hewlettpackard ceo Carly Fiorina, he said her record as ceo was a disaster. But our next guest says she shouldnt be known as hps worst chief executive but rather someone else deserves that distinction. Joining us now is cnbc contributor jim stewart. Its friday, here he is. Hi, everybody. Who gets the title . Well, you know, look, in fairness to fiorina, leo appletucker, only there slightly less than one year wreaked more havoc and the stock went down by just as much as over her sixyear term. The revelations about this disastrous autonomy deal just keep coming out. The latest one im highlighting in nominating him as the worst tech ceo, they wrote off 8. 8 billion of autonomy. In their due diligence, they had kgb do an accounting, and the chairman and the Board Members never read it. Can you imagine . How do you know that . Was in an independent study by a big law firm. To its credit, hp has revised its approach to due diligence. But theyre paying 11 billion for this thing, a lot of money to kpg for the report, and the top people dont read it theres an executive summary. What did the report say . Number one, it says they wouldnt answer our questions. They wouldnt give us the documents we wanted. So we couldnt answer most of the questions. They did say growth is coming through acquisitions, not through organic growth. Organic growth is actually falling. Both in the Core Software business and related businesses. That was key to this huge price this growth number. You had to plug the Growth Numbers to come near the 11 billion price. That was in black and white. Dont forget, he also embarked on that plan to split the company, not in the way that its being split now. That created chaos. I would tend to agree with you. Hes one of the worst in his brief tenure of all time. The question is hes not running for president. No. Im saying, lets be fair here to fiorina. Were throwing around these extreme characterizations. By the way, professor sondfield at yale said he is one of the worst. I said do you think shes worse than this . He stands by his opinion that shes worst. But its hard to top this. Its extraordinary that you have such a titan in this country that continued to be so badly managed. I asked several of the experts i talked to. I said is this so bizarre because if we knew more about corporate things, he said hewlettpackard was an outlyer. Didnt they used to spy on their Board Members . I reported in another column. They hired apotheker, the rest of the board didnt want to meet him. They didnt want do it. They didnt want to sit down and have dinner with the guy. Bizarre. You wouldnt want to sit down and have dinner with him. I remember meeting him. My god. Really . You have to remember donald trump as his record as ceo. Both trump and fiorina are rung on their records of corporate leadership. At least with hp, we have the public, the stock price, a wealth of information. Trump is a private company. So we dont really know. The trump record is not very sterling. You know, has any ceo ever been elected president of wasnt Herbert Hoover . Was he a ceo . Coolidge . I dont think heits been se as a fast pass to the presidency. Theres an anger and an antiestablishment movement on both sides of the spectrum that could be a game changer. That could be why donald trump is where he is and why hillary may not win the primary. Going back to the founding fathers, it reminded me they were not professional politicians. They all had lives outside. They had businesses, they stepped in as a Public Service to government and went back to whatever their lives were. You didnt need a billion to run for president back then. No. The kochs will do that for you if they get it right. To be a good ceo, you have to do some unpopular things. You have to fire people, cut costs. Lay people auchoff. Thats not an easy record to run on. Jim, very valuable. Thank you. Lets talk about oil prices. Climbing to the highest levels since july. Close to the best weekly gain for oil since back in 2009 with wti hovering near the 50 a barrel mark. We passed it earlier. John kilda watches energy and is a cnbc contributor. He joins us back from cnbc hq. Do you expect this rally to last . I dont really. I think the fundamentals are still too great to allow this to persist. For example, this week, we saw a big plunge in the refinery operating rate, down to 87 or so that will cause a huge back up in the crude oil system now as we go in the next few weeks. It will be a major data point here for the market to seize upon and push us lower like it did this time last year. Seriously, with russia involved, bombing syria, missing, missiles landing in iran, a key opec member and oil producer, isnt there enough tension in the middle east to keep the price of oil supported . Thats the only thing going for the market. Thats a big worry a big concern of mine. I wrote a blog for cnbc. Com last week about this situation. Yes. Theres a lot of room for error in those errant missiles yesterday just highlight how scary this is. But the oil market does a good job after a while of digesting these sorts of situations. I think that will happen again as we get used to these misfires, other misactionses by the russians in syria that will allow the fundamentals again to simply overwhelm things. I mean, its big houses like goldmans that are on your side with the call as well. My thing is the idea that keeps popping up that the russians will sit around the table eventually with the saudis and then its game on for opec. How do you weight that . I dont see that happening. Only because the saudis and the russians are at each others throats over assad and keeping him in power. The russians are in syria to prop up assad and the saudis are working with us to get him out. Ultimately when you see the saudis reserves dwindling as they are, not that its, you know, actually base level, but when they run out of cash, at some point we have to say we need to raise the price of oil. Simon, they have not gone in for the kill yet. Theyre seeing budgets cut 20 , 30 by the major oil companieses around the world. Theyre liking that. Theyre seeing their policies working. They can still hold out for quite some time before they throw in the towel here. Just on the trading side of things, extremely short positions could be leading to the quesqueeze higher. The dollar going the other way now. That helps the price of oil. Can you talk about you are still with us . Im there, sorry. You can talk about some of the technicals and other factors moving oil, perhaps one reason why we saw a big move this week . Theres no doubt that that there was a lot of shorts in the market and has been for a while. Theres also a lot of enthusiasm to pick the bottom like we saw earlier in the year. Theres a lot of money in the sidelines that came on here for the beginning of the quarter. A lot of long only commodity money that sees multiyear lows and wants to buy it. In technical terms the market was in consolidation phase between 44 and 48 after massive volatility the end of august. We were primed for a breakout. We have gotten this upside breakout for now. So youre sticking with the lower call on oil prices, like goldman sachs. But does that mean we could go down and retest lows going to the 30s or is that out of the question . Yeah. Im not always happy to be in the same camp as goldman sachs, ill take it this time. Yes, i do believe there could be a new low for the year. Again, you will see huge increases in u. S. Crude Oil Inventories over the next few weeks because of the this low refinery operating rate. That will catch some people by surprise and see what we did last year. Again, too, theres increasing chance of u. S. Tipping into recession next year im hearing from a lot of economist friends if that develops 15 , maybe an increased chance, but not the base case. I did not think it was in the cards to be honest with you when you have a Federal Reserve looking to hike rates and our impressive employment picture. I dont know where thats coming from to a degree, if thats out there, it will feed off the things in china and asia, which is the demand center which is key to Oil Prices Going forward. John, thanks for joining us on the price of oil and the big move this week. We look at wti, 49. 54. Cnbc delivers an exclusive interview with the new york fed president , William Dudley later on the program. Does he still think that there will probably be a rate rise this year . Why pause to take a pill . And why stop what youre doing to find a bathroom . Cialis for daily use, is the only daily tablet approved to treat erectile dysfunction so you can be Ready Anytime the moment is right. Plus cialis treats the frustrating 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. Insurance coverage has expanded nationally and you may now be covered. Contact your health plan for the latest information. Dad yeah, 20 something years now. Thinking about what you want to do with your money . Daughter looking at options. What do you guys pay in fees . Dad i dont know exactly. Daughter if youre not happy do they have to pay you back . Dad it doesnt really work that way. Daughter you sure . Vo are you asking enough questions about the way your wealth is managed . Wealth management at charles schwab. Heading into the weekend, lets pick up the Santelli Exchange on the way. Hi, rick. Hi, simon. Thank you. I would like to welcome my special guest, lacy hunt. Its always fascinating to talk to you, especially post the minutes of the las fed meeting. Steve liesman said it after i said it. And it shocked me were on the same wave length. It wasnt necessarily a close call as everybody made it appear, press conference and all, but in the end, if we do see a global glide path lower than it is, i think the possibilities of the fed pushing overnight rates into negative territory or the possibility of more qe, they continue to rise. Your thoughts on both of those. Well, qe has been tried three times unsuccessfully. Quantitative easing was more of a negative than positive. One of the worst positives is that it worsened the income and wealth divides in the country, caused a misallocation to capital, and overcapacity in a lot of industries. In fact, it has served its cross purposes to the feds goal of trying to stabilize the inflation rates. Its been a total failure. With regard to the possibility of negative Interest Rates, the fed has the capacity to engineer the lower rates. Banks are holding about 2. 5 trillion of excess reserves. The fed is paying them 25 basis points. Nothing presents the fed from charging 25 basis points as a safe keeping fee or 50 basis points. If they were to do that, it would force the rates into negative territory and have severe negative consequences for many components. Thats one of the difficulties of lets go to the negative consequences. I understand the institutional side of it. What about the average person on the street . If we see overnight rates moving negative. Negative out half the curve in europe, how would the average person be affected if at all . The average person, the bulk of their assets are fixed income over time it would aggravate the it would adversely affect the banks, their earning capacity, and it would also increase the unfunded liability of the Corporate Pension plans. They would actually have to call in the currency because as long as currency were a viable option, there would be tremendous currency disintermediation and people would begin to hold currency rather than to pay toe fun in a shortterm asset. Ell, we have to leave it there. Totally unknown. Listen, not a lot of cheery things to think about in that, but we need to be early on this. I think the possibility of negative rates is higher at this point in time than ever, but it stildoesnt mean its gng happen. Thanks, lacy. Have a wonderful weekend. I wish your astros well. I wish my cubbies well. Sarah, back to you. Great. Thank you very much. Rick santelli, have a great weekend. Up next, halloween say multibillion dollar business. More than 2 billion will be spent on just candy. That doesnt count costumes and decorations. Hear from one man who is trying to capitalize on that spending when we come back. Opportunities arent always obvious. Sometimes they just drop in. Cme group can help you navigate risks and capture opportunities. We enable you to reach Global Markets and drive forward with broader possibilities. Cme group how the world advances. Hello, ken jennings. I havent seen you since that tv quiz show. Hello, watson. You can see now . I can recognize people, analyze images and watch movies. Well i wrote a few books, did a speaking tour, i. Ive been helping people plan for retirement. And i help doctors identify cancer treatments. Is that all . I recently learned japanese. Yeah, i was being sarcastic. I havent learned sarcasm yet. I can help with that. From and the people whought you underwhelbrought youet speeds. Temperamental satellite television. Introducing. Underwhelming internet speeds and temperamental television. In one. Welcome to the moment no ones been waiting for. The Fastest Internet and the best tv experience is already here with x1. Only from xfinity. Hall lean wean will be a 7 billion business this year. Thats actually down about half a billion collars from last were. One man is making a lot of jack in the jackolantern business. Jane wells has his story. I thought we had a pumpkin shortage this were. This is the Great Pumpkin story. It involves a man, a dream, a lot of money, a lot of failure, and, finally, this. Theyre called pumpkin steins, and i take credit for their success. This is real . This is real. Thats last year when a friend told me you have to die story about this farmer near me who is growing melons and pumpkins into shapes. We met tony in 2014. When you saw your first one in person, what did you think . Is it real . Sam said his team had to convince degara to let them scale his business beyond his wildest dreams, but that price had to come down. However, instead of selling 5,000 pumpkin steins like last year. This year he has orders for 90,000. Theyre not going to be 100. Theyre going to be less than 30 at sams club this year. I can keep selling them at a high price, low volume, less work, but ive got a lot of other ideas i want to do. A big one was the skull mold, which i was really trying to get out this year, but with the onset of the volume that we all of a sudden had to produce, a couple of those projects just couldnt get done in time. All right. Next year, yes, a white pumpkin in the shape of a skull. He says he is finally profitable, and he doesnt have an exclusive with sams, so he is also selling these to other chains for higher. Right now, by the way, online, simon, this story behind this beautiful mistake. I love it. Presumably ultimately you can make them into any shape you like, jane. The mind boggles as to where this industry could go. Yes. Heartshaped valentine pumpkins. Lets send it over to kayla for a look at whats coming up on squawk alley this friday morning. Hey, simon, good morning. We have an interview that is more important than ever after yesterdays fed minutes. Sfluls, elan musk calling apple a tesla graveyard. Seems like a lot. Plus, the steve swrobz movie coming out this weekend. We will talk to a p. R. Executive responsible for selling the apple story. Steve jobs story way back when. Hear her thoughts on the matter. Squawk alley coming up next. 8 00 a. M. At tesla headquarters in palo alto, california. 11 00 a. M. Here on wall street. Squawk alley is live