Transcripts For CNBC Closing Bell 20130925

Charter peter sands is in the house, the state of the Global Economy and how they view whats going on in europe, the nonsense in d. C. Over the budget and debt ceiling. Were not finished. The hits keep coming. Cisco ceo John Chambers here exclusively. A lot of tech news. Well get to that coming up in the next hour. Googles eric schmidt, our special guest host in one hour. Hell be with me on set. Well talk with John Chambers along with eric schmidt. That will be interesting getting them to talk together. So much to talk about google and a lot more. Well get into technology and innovation. Wow, tech titan talk, huh . Yeah. Next hour. Lets get to the markets right now. As maria said, four down days. This could be the fifth. The dows down 42 points. Walmart, a drag late this afternoon. Well talk about why in a little bit. Theyve come off the lows, though. Now down 42 points. Questions on inventory now. Nasdaq is down to 37 64. S p is following suit as well, down 2. 50 points. Dow and s p in jeopardy of a fivecard losing streak. They could lose their spot in the wild card playoffs. We havent had this all year. Lets put you up walmart. Walmart had an outsized impact on the dow in the middle of the day. There was a report in bloomberg that perhaps the retail giant was cutting orders because of rising inventories. Courtney reagan talked to well matter and said that was a misleading story, they are constantly managing inventories. Remember, target missed and some Dollar Stores having problems recently. The low end is having some problems. It did have an impact. I said it had a broader impact. Consumer names in the dow all dropped on that. Theyve come back a little bit. Nike, procter gamble, johnson johnson, all moved to the downside. Ive been calling it fiscal fear fatigue. A lot of people are out there saying, look, the republicans and white house are still so far apart. Why get ahead of that . The traders feel the government will stay open, theyll make a deal but maybe it will bleed into october. Were getting low volume, low volatility days overall. Take a look at the s p 500. I know people were concerned about the stall. Were 1. 6 off the historic high. That was one week ago. Weve had a bunch this year in february, august, april. Those are the white circles. Same thing, dropped 2 , 3 , and then resumed. Dont panic. Russell 2000, hit an intraday high. Shinzo abe will be upstairs. Ill let you know if he says anything interesting. Looking forward to that. Lets talk about todays Market Action on closing bell exchange, David Ellison from the hennessey funds, michael from destination wealth management, Peter Anderson from Congress Asset management. Welcome, everybody. Erin, weve lost all of the gains from last week and the feds stunning no taper concept. We have no momentum going into earnings reporting season next week. What do you make of all this . I think as bob said, we see low volume pullback. Weve seen a lot of cash go into money market funds so it looks like cash is just sitting on the sidelines. Investors are waiting for that pull back to jump in. With the incredible volatility weve seen in bonds and yields going up 50 basis points, back down 50 basis points. But these levels trading at 50 1 2 times next years earnings. Lets wait. What would it take to get that money back . Is it a significant pullback . Something you would expect to push the money over the edge . Erin says its sitting there in cash or money markets. Yeah, its a pullback. I think investors are basically waiting for the markets to dip down. The bias is on the upside. The sentiment is still positive in the United States. You know, i long for the good old days when fundamentals matter. I know you wrote a column recently on cnbc. Com talking about fundamentals. Fundamentals are fine. Theyre not great. But the sentiment really is moving towards equities. You go to bonds, its a losing proposition. Commodities have been a disaster. Money market pay on negative net 3 . I think investors are waiting for a pullback. I think when you see the market go down, you see market buyers coming in. You dont think the fed will taper at all this year. Why . The fed is really keeping us on our toes with that surprise last week. And as much as people love to disagree with me on this, i think the fed is watching markets. They cant come out and tell you that directly. I think as soon as an official makes a statement, they probably go back and watch this tv station and get a sense of a real polling. Its an instant polling mechanism. You can come back, watch the market react in virtually real time to what youre doing and saying. I think the fed has finally caught on that the actions theyre taking, this socalled forward looking guidance. And thats borrowed, frankly, from corporate earnings, you cant have halfbaked guidance the way the fed is trying to do. You either have to give full disclosure or no disclosure at all. No forward guidance. I think whats going to happen is the fed go ahead. No, please finish. Well, i think whats going to happen is the fed is going to say to themselves, look, we either have to give even more disclosure, which i dont think is going to be the result. I think theyre going to kind of crawl back into their media cave and wait and just give formal announcements and not give this kind of, you know, press conferences two or three times a week we have officials yeah the issue is so many voices in the fed. We have so many governors and officials coming out and coming out with their own opinions. David ellison, lets talk Fourth Quarter here because were about to end the third quarter. Earnings will flow out. The last time we spoke with the ceo of walmart on this program a couple weeks ago, they were not expecting any great shakes from the holiday upcoming season. Is that going to be a positive for the markets . What do you think about the Fourth Quarter, David Ellison . I think the market is waiting for the third quarter, the Fourth Quarter. Of course the guidance for 2014. I think when we get that, the companies doing better are going to go up and companies not doing as well are going to go down. I think there are Companies Going to do better. Earnings are a big part of why the market hes gone up and earnings will continue to get better because the economys generally Getting Better and companies are continually trying to get better. I think theres a lot of talk. At the end of the day, companies have a lot of flexibility. Sales arent there, they can cut costs. If the revenues arent there, they can drive it to the bottom line. The companies have a lot more flexibility than people think or giving them credit for, which is why the market generally wants to go up. You guys at s p capital iq, the handicap for earnings. Quantify that. Going for the year were looking right now, the estimate for 2013 is 5. 8. 5. 8 . On earnings . On earnings, the s p 500. We started the year at about 7. 50 . So, the analysts have really ratcheted down. One thing last quarter, we didnt have as much of an upside surprise. It was one of the smallest quarters for upside surprise. They usually estimate 5 , 4. 5 . Last quarter was 3 . And revenue has been soft the last couple of quarters even though they met their bottom line. That happens again . Yes. If we see another quarter of declining revenue, thats a big issue for everybody. Another thing were looking at, maybe postponing tapering even further. We have a lot of ceos on today. Im sure youll ask about that very issue. Thank you for joining us today. Appreciate your thoughts. Heading toward the close, about 50 minutes left. Again, remember, we got japanese Prime Minister shinzo abe ringing the closing bell today. Stick around for that. Hes live in the gallery right there. Dow down 38 points off the lows of the session. Well talk with dow chemical ceo and find out whats in store for his 50 billion company and what hes seeing in the Global Economy as well. Breaking news. Jpmorgan facing billions in fines or billions in some kind of a settlement. What does it mean for the stock and its shareholders . Should you still be investing in this particular bank . Both sides coming up. After the bell, googles executive chairman eric schmidt with me for the whole hour, talking about security, google glass and his plan for beating out the competition. He says he has a plan to create jobs for the u. S. Economy. Americans take care of business. They always have. They always will. Thats why you take charge of your future. Your retirement. Ameriprise advisors can help you like theyve helped millions of others. Listening, planning, working one on one. To help you retire your way. With confidence. Thats what Ameriprise Financial does. Thats what they can do with you. Ameriprise financial. More within reach. [ agent smith ] ive Found Software that intrigues me. It appears its an agent of good. [ agent smith ] ge software connects patients to nurses to the right machines while dramatically reducing waiting time. [ telephone ringing ] now a waiting room is just a room. [ static warbles ] female announcer the savings really stack up during sleep trains during sleep trains inventory Clearance Sale. Save 10, 20, even 35 on a huge selection of simmons and sealy clearance mattresses. Get two years interestfree financing on tempurpedic. Even get free delivery sleep train stacks the savings high to keep the prices low. The inventory Clearance Sale is on now guaranteed sleep train you ticket to a better nights sleep welcome back. One of the stories weve been following this afternoon, walmart, a report about their inventory levels out there. They told us here at cnbc the company is always managing inventory, constantly machine managing inventory. The story we heard they were cutting orders. They told us that was misleading. It begs the bigger question whether the economy is still weak and maybe the fed was right to hold off on the taper. Rick santelli is with me from chicago with our bond report right now. When you consider that kind of a story and then as we get ready for earnings and s p capital iq telling us theyre still expecting softness in revenue, the order, the top line for major corporations out here, what do you think . I mean, is ben bernanke right when he says they shouldnt taper because the growth is not sustainable right now . Well, i think the latter part of that statement is for sure true. Any type of sizeable, Sustainable Growth in the economy isnt there. Consider this, bill. Walmart is roughly now up 9 on the year. Tiffanys, on the other hand, is up four times as much. Its up 35 . Think about some of the big stories about how over the last five years, sams club, for example, has dropped a lot of employees even though theyre opening up new stores. What i garner by all that is that the economy is weak and the feds plans and many of the governments lack of plans arent helping the situation. And i think that the fed probably ought to consider some of the more structural issues. Many of these programs benefit the high end. You know, while one seems a little silly to me. All the plans are designed to help the middle class, but whether its earnings or many of the other aspects of the economy that affect the affluent, they are benefiting from many of these programs. They need to reverse this course on qe. You hold to the ar ument they are you hold to the argument an unintended consequence of the quantitative easing is its benefiting the few, but is that reason enough to start tapering at this point . I think it is. When it comes away from it, strip away the fluff, were arguing about continuing a program that adds huge amounts of unintended consequence as their Balance Sheet approaches 4 trillion but the benefit analysis lays an egg. Rick, thanks much. The tenyear at 6. 26 . Continues to move down this week. This week the Clinton Global Initiative is kicking off in new york. A number of ceos are here, including dow chemical. Dow investors have been rewarded the last three months. Stock up better than 20 just in the threemonth period. Joining me is the chairman and ceo of dow chemical, andrew liveris. Thank you for joining me. Good to see you. You have a great Vantage Point in terms of whats seeing in china and the implications of it. How would you characterize Business Today . Give us the hot spots and the weak spots in the globe. I think the china improvement is definitely there. China has been soft for about a year, so the last month or so its been better. Still not know where near it was. I would tell you europe is flat lining with a little good stuff out of germany, which is hopeful post the elections it continues. Lets call that status quo. Japan has been a surprise positive. Southeast asia and latin america are their usual selves with brazil slow. The u. S. Has been the bright spot. I would say most of this year the u. S. Has been better than what we had planned for and it shows in our results and our equity price. Of course, im very concerned with whats going on in washington. Because we could proceed verbally shoot ourselves in the foot again. I want to get back to the debt ceiling. You mentioned japan. You have shinzo abe, the Prime Minister here at the New York Stock Exchange today. You know, that market has, of course, been on fire. A lot of money moving into japan. Do you think the economic policies will work . Do you think thats sustainable . I think abenomics, version 2. 0, will work. Wooif been big in japan. Its been an extraordinary summer. I was over there in april. Business confidence is up. It doesnt take much. When you finally get confidence, and thats been 15 years of gloom, i really do believe their export engine is reawakening. Theyve always had great companies. Theyre starting to dot tough stuff. This merger that was announced yesterday or today, its a good example of restructuring. In my sector theyre starting to take out capacity. Finally, highcost capacity that never should have been there. I think theyre starting to enter the real Global Economy again. Okay. I mean, from agriculture to technology, where do you think is the big Growth Engine for dow chemical at this point . Where does the growth come from looking out five years . Well, so, i think the two buckets and were at the intersection of sciences, biology, chemistry and physics, material science, lightweight materials for automotive and transportation in general, Electronic Materials for faster, cheaper device, the ones we use in our mobile phones, et cetera, and then agriculture, biology, food, nutrition. Weve introduced this new canola oil thats taken 1. 5 billion pounds of fat out of the american diet already, just this year, by having none of the bad fats. I think the demand drivers of the world collapsing in on each other, health and nutrition, alternative energies, lightweight materials and consumerism of the right kind. Sure. Now, youve recently announced investment of more than 1 billion, building two plants in louisiana. This is something the president is trying to do and have others do as well, invest in this country in manufacturing. What kind of policies would you like to see to encourage more of that . Well, i mean, all of the above Energy Policy and responsible development of our shell gas fines has been very important. Weve been part of the discussion of how to optimize use of all the energies available to the United States, with shell gas being the big plus. Were putting in place 5 billion, maria, in u. S. Gulf coast between texas and louisiana. Theres 1 billion referred to as most recent announcements. That will create thousands and thousands of jobs. Job multiplier of mine industry is one to five. For every job i create, i create five around me. That creates 20 of value around me. This is the kind of information the president and the country needs. I think we are right at the cusp of seeing a reawakening of the American Manufacturing engine. No doubt about it. Im glad you mentioned the 5 billion because this has all been coming together for dow chemical. Real quick, andrew, in terms of health care and in terms of this fight over the debt ceiling, what should be done . I mean, you havent announced major changes to your health care plan, right . A lot of people feel its too expensive and necessity athey a employees off this. What is the answer and how does it relate to whats going on in the debt ceiling debate n your view . Well, the last part first. There should be distinct and different discussions. And to get functionality it into our conversation. No one should be held hostage to default the government. We should not be in that conversation. It creates all this uncertainty. This should go behind closed doors and get out of the public domain. This should be a negotiation not a public squabble. It creates uncertainty and the greatest headwind we all face, if this continues, doesnt matter what policy they attach to the discussion, its a precedent that should not be set. Im of the camp in the Business Community that says, look, get behind closed doors, settle your differences and dont make one hostage to the other. If you want a debate on the Affordable Care act, have a debate on the Affordable Care act and bring it to a vote if you need to. From our companys perspective, the aca is low impact. Weve done all the right things over the last decade or so. Frankly, its not an issue for us. But having said that, its becoming an issue for us because of attaching it to the debt ceiling conversation. Yeah, very good point. Andrew, thanks for joining us. Well see you soon. Thank you, maria. Always good to be with you. Well be watching your commitment and developments at cgi this week. Good to see you. Good to see you, too. Andrew lev richris joining us. The top of the hour order was biased to the buy side. We have come off the lows. The dow is down 38 points n danger, maria, of a fifth straight down day dpofor the markets. Jpmorgan and jamie dimon may be trying to set settle the lawsuits and probe. But its never ending. Well reveal that number coming up. Facebook and amazon stocks soaring. We know that. Ceos Mark Zuckerberg raking in big bucks as a result. How big . We have details coming up. [ male announcer ] some things are designed to draw crowds. Others are designed to leave them behind. The allnew 2014 lexus is. Its your move. But it doesnt usually work that way with health care. With unitedhealthcare, i get information on quality rated doctors, Treatment Options and cost estimates, so we can make Better Health decisions. Thats health in numbers. Unitedhealthcare. With fidelitys options platform, weve completely integrated every step of the process, making it easier to try filters and strategies. To get a list of equity options. Evaluate them with our p l calculator. And execute faster with our more intuitive trade ticket. Im greg stevens, and i helped create fidelitys options platform. Its one more innovative reason serious investors are choosing fidelity. Now get 200 free trades when you open an account. Building animatronics is all about getting things to work together. The timing, the actions, the reactions. Everything has to synch up. My expenses are no different. Receiptmatch on the business gold rewards card synchronizes your business expenses. Just shoot your Business Card receipts and theyre automatically matched up with the charges on your online statement. Im john kaplan, and im a member of a synchronized world. This is what membership is. This is what membership does. Jpmorgan reportedly trying to come up with one big number to make legal problems go away. How big . Kate kelly has stunning details right now. Has jpmorgan strives to settle a crush of litigation, they may be facing one yesterday, 20 billion or more. In a separate report a short time ago, 11 million. A source familiar with the talks tells me the 11 billion is in the zip code, although talks are fluid and unlikely a deal will be finalized today. That number could still move. Jpmorgan started this week ready to go down fighting, feeling the governments proposed fines over mortgagebacked securities issued between 2005 and 2007, the period right before the financial crisis, were simply not reasonable. In general, jpmorgan chief jamie dimon and his board would prefer to settle their regulatory cases if they could. Any settlement would have to be something they could live with in terms of the financial penalties and admission of wrongdoing, or lack thereafter. And 20 million for issuing these mortgage securities, which was the operative figure we were told, simply was not, especially if it didnt bundle together all the related cases in this matter in one fell swoop. It includes one case with the Justice Department and one from the new york general. The two sides are still hashing out the final figure as we speak, but the tone of the discussions has improved significantly since early this week. One point that has achieved consensus, to create Customer Relief Fund as part of the financial penalty. Other Details Remain to be seen. Of course, well be on the lookout and bring you the latest details as we get them. Kate, thank you very much. Thats a lot of money. Despite those legal issues, shares of jpmorgan are rebounding today. It is the best dow performer, wouldnt you know. Should you be putting your money in jp yp right nmorgan right no . Lets talk numbers with andrew busch, author and publisher of the busch update. Do you like jpmorgan fundamentally . Its hard to say, right . The stock peaked in june around 57. Its fallen significantly since then. Rebounded today. I mean, that 20 billion number came from the New York Times and hud and thats enough to scare anybody who owns the stock. Essentipecially jamie dimon. Yeah, right. 11 billion sounds great in comparison. Lets face it, its hard to keep track of all the lawsuits and penalties this companys going to pay. Thats kind of the uncertainty they created around the stock. That would keep you from buying it, is that what youre saying . Yeah. I have a strategy. My playbook, look, if they sell everything up for less than 7 billion, im more than happy to buy it. If its between 8 to 12 billion or 13 billion, id leave it alone. This was a stock that was very strong among financials but its been showing signs of wear and tear. What do you think of the charts . Exactly. The financials have been underperforming the broader s p. I think it has a lot to do with what the yield curve is doing. We dropped about 15 basis points since the last fed meeting. Thats going to pressure financials. Jp is weaker. Technically speaking, you have a classic head and shoulders reversal pattern. If we crack 50, we need a daily close, thats a trigger to the lower side. Im on the floor of the nyc, shinzo abe is here, falling longterm yields in the u. S. Is going against everything japan is doing. Thats going to feedback into our markets. The head and shoulders, how low could it be before it breaks . You want to project that down, you could see a move down to 43. Would you be a buyer on that, andy . You know whats interesting is im more of a buyer if Interest Rates continue to drop. Then we know bond trading revenues will go up for jpmorgan and other financial institutions. As we saw, the rapid rise in rates, that really hurt bond trading. Jeffries is a good example, boou duitch bank. We should see it go the other way before it benefits those, like jpmorgan. Thank you for your thoughts on jpmorgan. Another big performer on an otherwise down day. Heading toward the close and the dow is down 52 points. Up next, how are increasing global regulations in the Banking Industry . Standard charter ceo peter sands will join us. Well ask him how worried they are overseas about the dysfunctional d. C. Dont forget, google owns more and i think that platform has just as many problems as blackberry does right now. I dont like google at all. Coming up, google executive chairman eric schmidt will be with us explaining why famed Technology Expert dan niles is wrong about his position. Well also get his thought on the nsa masquerading to spy on web users. I am today by luck. I put in the hours and built a strong reputation in the industry. I set goals and worked hard to meet them. Ive made my success happen. So when it comes to my investments, im supposed to just hand it over to a broker and back away . Thats not gonna happen. Avo when you work with a schwab financial consultant, youll get the guidance you need with the control you want. Talk to us today. But at xerox weve embraced a new role. Working behind the scenes to provide companies with services. Like helping hr departments manage benefits and pensions for over 11 million employees. Reducing document costs by up to 30 . And processing 421 billion dollars in accounts payables each year. Helping thousands of companies simplify how work gets done. Hows that for an encore . With xerox, youre ready for real business. Welcome back. Heeding toward the close with the dow and s p, heading for what could be fivestraight losing day. Domini dominic chu has been tracking the big losers. Jp jcpenney heading to 13year low. Down six straight sessions. Blackberry falling this after bernstein said they didnt think fairfaxs acquisition of the company would actually come to fruition and close. Thats huge for blackberry. Mako surgical is soaring after stryker is acquiring it, coming to 30 per share. Stryker paid hefty. Tesla about to close at another record high. Hertz with announcement of the tesla car in the u. S. With that expansion consumers in select markets will be able to rent the model s and tesla roadster. Maria, if youre a hertz customer, get ready for more options on the electric car side. Yeah, dom, thanks. With an increase in the socalled valueadded tax on the table in italy, v. A. T. Tax, investors are debating whether giving them a boot. The economy minister has been opposed to raising taxes saying hes ready to resign if that v. A. T. Tax is increased. I spoke to the Prime Minister italy about this very subject earlier. Will you go forward with the increase in the v. A. T. Tax . Its one of the decisions we have to take in the next days or months because the v. A. T. Raised was already decided by previous government in 2011, postponed, now is the time to have the final decision because its already in the budget, the raise. So, it will not be easy. But it will be one of the crucial decisions of the next days and months. But i will say that the Crucial Point in italy, today is to think how to affect Foreign Investors and what is linked to taxes. The main problem is to lower labor taxes. Tell me what your priority is. Is it labor reform . Is it cutting taxes . How do you get back to growth . The main point is stability, stability, stability. Why . Because italy was in a nightmare because of the raise of the Interest Rates for our debt. The result will come soon in terms of growth. Three initiatives already taken. That will give us growth at the end of the year and im sure that next year will be a year of complete growth for italy, after years and years of lack of growth. Okay. Growth in italy next year. Well be watching that. We want to talk about europe, talk about the emerging markets as well, because they seem to be getting hot again. Morgan stanley emerging market index is up after a negative first half of the year. Joining me from midtown manhattan at Clinton Global Initiative is Standard Charter ceo peter sands. Good to have you back on the program. Welcome. Good to be with you again, maria. I guess for the Banking Sector, your company in particular, youve been in the sweet spot of where the growth in the world has been over the last few years, but weve seen real volatility in emerging markets. A number of guests on this program have said theyre beginning to invest once again in the em. Tell us about what youre seeing out there in terms of growth in the world today. Well, we continue to remain focused on asia, africa and the middle east. While there are ups and downs, the emerging markets is not a homogenous bloc. Different countries face different problems. Terms of emerging markets, where are you seeing the most opportunity . Last time we spoke we were talking about this population growth throughout asia. That really was warranting a lot of growth for Standard Chartered. Are you still seeing that or have things slowed down in some of these pockets . Youre seeing some slowdown in some markets and some markets like india are facing particular challenges. China has slowed down but i think its slowing to a more Sustainable Growth than we saw before. The composition of growth will be better. Were seeing very strong growth in places like africa. Where they are seeing not just commoditydriven growth but emergence of a real middle class. I want to ask you about regulation. Of course, theres an editorial in todays financial ti praising president obama for his stance not to negotiate on the debt ceiling and calls out congressional republicans. Whats your sense in terms of the volatility going on in washington . Is that going to disrupt business once again the way we saw last year . Do you worry about this . Then well move on to regulation. Well, because the dollar plays such an important role, it is the global currency for trade, for crossborder investment. Anything that affects sentiments around the dollar has a big impact on the way Global Financial markets work. What can seem like quite small ripples from either the feds stance on tapering or the whatever is going on in d. C. , these ripples can actually seem like quite big waves when they hit the much smaller markets of individual countries in the emerging world. So, you do think they will have implications then for the world, for markets as well. You also yeah, no, i do think go ahead, peter. So, i do think it will have implications. Im not quite sure which direction, but we certainly anticipate that there will be more volatility. In your own oped piece, you wrote your own piece in the ft, raising simplicity can be dangerous. What did you mean by that . It seems the big issue for Banking Sector is around regulation. Not necessarily years ago we could talk about acquisitions, talk about growth. Fewer and fewer conversations are about that lately. Its more about regulation and the cost of it. Youre absolutely right. Regulation is intensity complex. I would love for it all to get much simpler. On the other hand, we dont want the wrong kind of simplicity. Simplicity that actually covers up important simplicity that distorts. I think the key thing is to make it as simple as possible is to have it as internationally coordinated as possible. The thing thats causing complexity is the fragmentation of consensus across different jurisdictions about how different regulations work. For example f you look at switzerland right now, they are contemplating compensation regulations where the top guy cant make more than 12 times the bottom guy. If youre looking at a compensation regulation, should that be across the world . Well, already youre far away from that, right . Because we have some fsb principles, which are global and have been agreed by the g20, but actually the way these are bei being implemented or carried for is very different, be it switzerland, as you say, or cr principles and Capital Requirements director. So you have very different approaches in different places. For a company like ours which employs 90,000 people across 70 countries, thats fiendishly difficult to be fair and treat everybody equally across the whole network. Totally understand. There should be a global standard where everybody is competing against one another but theyre looking at their own local laws. Can we do that, have a global standard and have each bank, regardless of where theyre from adhere to that structure . Well, the sad thing is that the level of principles already exist. The Financial Stability board agreed to a set of principles which are pretty clear. Its just that in implementing these in different countries, actually people have diverged quite markedly from those principles, i think if we can in a sense work back towards these principles a bit, i think its completely appropriate that there are some differences that reflect different market circumstances. But we need to adhere to the principles. And then thats not just true of competition, thats true across other areas of regulation as well. In terms of capital, are you comfortable with the level of capital at the bank today, or are you expecting to come back to the market to raise more capital . Were very comfortable with our capital ratios. We have one of the strongest Balance Sheets of any bank. Peter, good to have you on the program. Thank so much. Thanks, maria. Peter sands is the ceo at Standard Chartered. If the final stretch of trading today. A market down 36, off the lows but nonetheless down double digits. Not really a dip and not buying the dip either. We have definitely lost momentum going into the end of the quarter here. The mall massacre in kenya is sending shock waves around the world. Our scott cohn is at a security conference in chicago where mall security is front and center today and where experts are saying, it may only be a matter of time before it happens here. We have a live report still ahead. Also ahead, you can Google Eric Schmidt and see what the tech titan is up to or see him right here, eric schmidt, my special cohost for the 4 00 hour. Well talk about the nsa controversy and what the google had to tell the federal authorities. Nascar is ab. Out excitement but tracking all the action and hearing everything from our marketing partners, the media and millions of fans on social media can be a challenge. Thats why we partnered with hp to build the new nascar fan and media engagement center. Hps Technology Helps us turn millions of tweets, posts and stories into realtime Business Insights that help nascar win with our fans. In a we believe outshining the competition tomorrow requires challenging your Business Inside and out today. At cognizant, we help forwardlooking Companies Run better and run different to give your customers every reason to keep looking for you. So if youre ready to see opportunities and see them through, we say lets get to work. Because the future belongs to those who challenge the present. The nairobi mall siege has sent a chill to anyone who has set a foot in a mall, which is most of us. While the crisis may be over in kenya, it is resurrecting old concerns in this country. How to protect socalled soft targets, like shopping malls. Scott cohn has been talking about this with many Security Experts in chicago. Theyre gathered for their annual convention. And theyre worried. Scott, what are you hearing . Reporter maria, were here on the magnificent mile in chicago, mall operators like the operators of the iconic Water Tower Place behind me, wont talk about the specifics of their security, but at this security conference not far from here, they are talking about it. Showing off all of the latest technology and different types of things to keep customers and keep shopping malls safe. This weeks attack on an upscale mall in kenya brought all of that home for people at the conference. And the focus is keeping the bad guys out of the malls in the first place. Your security teams that are there, from their technology standpoint of cctv from the camera aspect, the eyes in the sky. Looking for and being trained to recognize what might be a potential concern before it actually leaves the parking lot and they enter into the mall. Reporter but just about everybody we spoke to said a determined assailant is going to get into a mall. Among the people we talked to, michael, former fta agent, former International Security expert and he says because an attack may only be inevitable here, a lot of the burden is going to be on you. Its tough for people to do this, but they need to run a scenario through their mind that mass gunman comes through here, what would i do . If you dont do those kind of things and it happens, you tend to freeze in place and you might die. Reporter that certainly changes your Holiday Shopping experience. All of the major mall operators weve spoken to, including General Growth Properties that operators Water Tower Place, say security safety is their utmost concern. They are taking precautions. They say a lot will not be visible to shoppers. Again, Everybody Needs to be vigilant. Back to you. Thanks very much. 12 minutes before the closing bell sounds for the day. A market fractionally under pressure. Shinzo abe behind us. Getting the 411 on how it works. Yeah. Stocks in danger of a fiveday losing streak. Well talk to someone who says it may be time to look overseas, like japan. Cisco cashing in on internet of everything. Chairman and ceo John Chambers will be with us. He tells us why it could be a game changer. Get paid to do something you really love, what would you do . [ woman ] id be a writer. [ man ] id be a baker. [ woman ] i wanna be a pie maker. [ man ] i wanna be a pilot. [ woman ] id be an architect. What if i told you someone could pay you and what if that person were you . When you think about it, isnt that what retirement should be, paying ourselves to do what we love . Welcome back. Want to show you some pictures here of this is live right now. Hes walking past. Prime minister of japan, shinzo abe. Walking the floor. This guy is taking some victory laps. Hes a rock star on wall street. Obviously the Economic Policy hes put in place in japan since he took office have helped turn things around in japan. Now its up about 40 this year alone, the nikkei is. So, he has been upstairs here at the New York Stock Exchange discussing what we affection atly call abenomics. Taking victory laps. Our next guest says emerging markets is the place to be. Joining us is a. J. From merrill link. Do we start with japan . I do like it a lot. It has reemerged. Absolutely right. I think the valuations are good. We all know about the three arrows. The main thing is the yen has to weaken. That takes off their top line and eps, which is surprising, nicely. I was at a conference in tokyo last week. A lot of clients there are reasonably bullish, which they should be. Youre talking about emerging markets largely. Break this down for us. Peter sands said every emerging market is not the same. We know that. Where do you see opportunity . I like the countries that have been beaten down quite a bit. A like value ideas is russia. I like china tactically. India is controversial. I like that. I like korea quite a bit. Theyre all different but most are trading at reasonable valuations, around ten times p. E. There are some countries in trouble. For example, turkey, some of the asean countries. You need to differentiate between these markets. Youre not going to buy a whole country. Do you dig down deeper into different Industry Groups . Yes. For example the Interest Rate principles around the world dont favor financials, i wouldnt think but what about growth and infrastructure and things like that . What do you do with etfs. You can do it on etfs, and Semiconductor Stocks look good, auto stocks, retail idea, vanity capital ideas, the beauty stocks. So, quite a few growth and value names. Some of the Public Sector type stocks in emerging markets are creating very deep discounts now. You have to believe valuations are better in the e. M. As opposed to u. S. Any opinions on the u. S. . My colleague, u. S. Equity strategist, is bullish on the u. S. Equity market. She thinks its undervalued. We do like the u. S. But i think emerging markets look good for three months. Longer term there are some pretty serious issues. Thanks for joining us today. Thanks very much. Good to see you again. Coming back with the closing countdown. We have a big one coming up in a minute. In a bit, googles chrome and android systems are on millions of devices. Whats the next big thing . I talk with eric schmidt, my guest host at 4 00. Bill will take you to the close. [ male announcer ] staying warm and dry has never been our priority. Our priority is, was and always will be serving you, the american people. So we improved Priority Mail flat rate to give you a more reliable way to ship. Now with tracking up to eleven scans, specified delivery dates, and free insurance up to 50 all for the same low rate. [ woman ] we are the United States postal service. [ man ] we are the United States postal service. [ male announcer ] and our priority is you. Go to usps. Com® and try it today. Mr. Daniels. Mr. Daniels. Look at this. Whats this . Clicks are off the charts. Yeah. Yoshi, were back. Yes, sir more shipping more shipping [ beeping ] [ beeping ] nascar is ab. Out excitement but tracking all the action and hearing everything from our marketing partners, the media and millions of fans on social media can be a challenge. Thats why we partnered with hp to build the new nascar fan and media engagement center. Hps Technology Helps us turn millions of tweets, posts and stories into realtime Business Insights that help nascar win with our fans. [ cows moo ] [ sizzling ] more rain. [ thunder rumbles ] [ male announcer ] when the world moves. Futures move first. Learn futures from experienced pros with dedicated chats and daily live webinars. And trade with papermoney to testdrive the market. All on thinkorswim. From td ameritrade. As we head toward the close, 90 seconds left here. Looks like well have five consecutive down days. First time in a while thats happened. We definitely lost some momentum. Since Prime Minister abe of japan is ringing the cloetsing bell, we thought we would show you year to date performance of the nikkei while we were at it. We were just highlighting that. Its up 41 year to date in this case. But today overnight it was down 112 point. Chris is with me right here. Do you like japan . We do. Weve overweight japan. We overweighted europe via germany. Now Overall International developed markets were overweight. What about relative to the u. S. Weve definitely lost momentum going into the fall and the earning season coming up next week. It was a rush to get into the idea for a lot of portfolio managers, especially globally run money. Now youre seeing money come back to the etp again. The story is on, as well see later, that abenomics is working. Theyre the faster developed market out there right now. At what cost as the yen goes lower . At the cost of inflating the economy. Thats the first phase to get momentum, especially for nomanol gdp. Thank you for joining us. As we go out, the dow is down about 55 points. The Prime Minister of japan, shinzo abe himself is ringing the bell at the New York Stock Exchange. What an hour maria has. Shell be wearing google glasses on the next hour of the closing bell. Ill see you tomorrow. And it is 4 00 on wall street. Do you know where your money is . Hi everybody, welcome back to the closing bell. Im Maria Bartiromo on the floor of the New York Stock Exchange. The dow closing lower for the fifth session in a row. A decline about 6 0 pe0 points. Volume is on the low side today. 554 million shares trading at the big board. Nasdaq gave up 60 point. That was one of the better performers, tech was