Have given us data that were supposed to be looking at. Were supposed to interpret that data and figure out if theyre going to raise or not. They told us were going to raise at least three or four times. You dont see the three or four rate hikes. It doesnt seem like a possibility right now and is the data changing in front of us right now because we have no idea. It seems like they hit the various data points. Job gains, joe continue, Unemployment Rate at 4. 9 and yet were still near zero Interest Rate policy. They have a dual mandate and part of the dual mandate is Financial Market stability. I do think they look at the s p and where global marks are and when everyone went to jackson hole and position themselves to the Federal Reserve not to taper further, you know, the federal reser reserve. So to petes point theres too much unknown or too much lack of clarity and positions seem to shift. The fed doesnt seem to be following through on what it says. The data seems to suggest that the fed could make a move. That they should have make a move and didnt. Now its too late. Who knows what to believe. I dont think the fed lost credibility from their Monetary Policy because im not against holding rates where they are now until theyre sure because as joe points out you have the dual mandate and the Economic Data only really started improving over last month. However where they have lost credibility is that theyre culturally adrift as an organization. Its the only organization that i know of that strives to be successful that has multiple voices. When they say theyre data dependent wres they do and you have another Voting Member saying Something Else so every day of the week you can get a different view so thats confusing and its failure, culturally for any organization. Lets bring in senior economics reporter steve to the conversation. He is live inside the Federal Reserve today where janet yellen will render the decision and hold that News Conference. Steve part of the feds problem is it hasnt even forecast things correctly. I think thats a big part of it. Look it says that what its doing is basing policy on the forecast. Data comes in. How does it change the forecast for the medium term but those forecasts have not been very good. In fact it looks like my friends there around your cable there scott have done a better job of forecasting than the fed. Lets go back and think about what happened. It was the summer when markets started to get disappointed and upset by whats going on globally and only after that did the Federal Reserve start to incorporate that into the statement. This january the market started to be concerned about Global Economics and the fed brought that into its forecast. The fed wasnt ahead of the curve on any of that stuff and it should be ahead of the curve and the other thing that you mentioned is its data dependent so we had two months now of rising inflation and the fed is largely expected to hold the line here. Theres a lot going on. Theyre trying to be transparent about it and it has to at least start to get its forecast more right than wrong and you have the Inflation Numbers. Its already got the inflation and forecast for all of 2016 in the month of march. Highest core inflation since 08. Doc its as if the market is dictating to the fed rather than the other way around. But the market can do that judge because its more moment by moment sort of trading which is what all of us here on the desk do. We trade. When youre more or less like the fed, id say thats more like an investor. Theres a much longer sweep when theyre getting in and getting out when theyre starting and stopping than there is for us who are daily in and out of the markets so retail sales yesterday, down, the revised january retail sales also down. That gives them the excuse, if they needed an excuse, to say this is why were not moving right now because we dont want to cripple the economy just as we think its starting to get going and because if we go too fast they had already started raising rates into a global slow down which many people say was the first problem. Which i sympathy the point. So steve, the question i would ask you is, vn we seen defacto tightening by what happens in japan and europe which is causing our dollar to move higher even if it stays stable relative to the other currencies and theres nothing that we can do to control what bonds are doing because its a safe haven unless you want regular tnegati or troubled economies. So the fact that were in for the first time really, a true Global Market and true Global Economy versus other cycles, doesnt that limit how fast they can move. I think it definitely does. It complicates factors for the fed. Its useful that the ecb has made its big move before the fed meets here and i think that there are concerns. I know from my interview with the fed governor brainerd that she does not want to see me moving too far away. Theres a limited divergence for the fed. The fed has a man date to take care of its home turf so to speak and if you have those rising Inflation Numbers you have the possibility that those cheap gas numbers are going to start to roll out of the cpi index. In other words comparisons with a year ago theyre going to have rising Inflation Numbers so the heetd is going to be on the fed regardless of japan and europe right now. Well see you in the room later on. All right. Steve at the Federal Reserve in the nations capitol. How are Bond Investors positioning their portfolio ahead of the fed . Lets bring in scott. He is the cio of core strategy. Welcome back. Its good to see you today. Thanks. Weigh in on this question has the fed lost its cred . Its been eroding overtime and thats why the market has largely been conditioned to ignore a lot of the fed forecasts at this point in time. That has to be frustrating the fed some what. Makes their job much more difficult but it is the result of continually i think being a little bit too optimistic about the outlook for the u. S. Economy and Global Economy and therefore constantly predicting growth and inflation above what has been realized so its a difficult balancing act from here. I think what youll see today is the Federal Reserve wanting to convince the market that it should price in something closer to what the blue dots project which will probably be something down from where they were before. Thats something were used to seeing but still will be something closer to three hikes through the balance of this year. The markets only price for about one so the fed would be much more comfortable if there wasnt such a gap between those two. So they might try to indicate that june is a much higher probability. Remind everyone once again that even when there is no press conference scheduled they could move as early as april. It seems quite unlikely but thats where we think theyll end up. I was just going to say whether they lost their kred or not, it appears as though the serious question being asked globally when it comes to Central Banks is whether they have lost the effect of their policy in general. Whether the efficacy of what Central Banks can do has been lost. Well, absolutely. And we would certainly agree that at this point in time, yes, i mean, each Central Bank Action is becoming less and less impactful it seems on the real economy. Less impactful in many ways on Financial Markets as well so that is why on a global basis it would be refreshing to see Central Banks push back against the notion thats been pushed upon them. This idea that theyre responsible for the entire functions of the economy. Theyre responsible for Monetary Policy but they cant control real economic variables in the way that many would like to believe so there needs to be a push back against that. And emphasis that Monetary Policy at this point in many cases might be doing more harm than good and its more important to move back to a normal set settings particularly like the u. S. Whats the best trade in the market today as we await the fed and the all porn message more than anything . Its more quality space in fixed income. We like inflation linked treasury bonds. Clearly the fed is behind the curve by many differ metrics. Its possible to see a situation where headline goes up to core and both begin rising because we have a tightening labor mark and the fed will be nowhere close to being neutral in policy. So right now theyre very cheap. Theyre pricing in inflation to stay well below the feds target forever so theres a large cushion. At least 60 or 70 basis points of extra cushion so even while the fed raises Interest Rates and you can see nominal yields rise inflation linked bonds can be strongly out performing. Good to talk to you today. Well see what happens this afternoon. See you soon. Thank you. All right. Doc on this question. I think to highlight what pete said and what he just said you have to see them coming together. We talked about the plots versus what the Market Expectations are and we said thats why volatility was so high during january and february because they were still saying four, now perhaps theyre saying three we will see what they say after today but i think you cant have a diver gent one versus 4 or one versus 3. They have to come closer together and if thats two versus one thats something you can live with scott but not one versus four in term of saying four rate hikes and the market saying one. I have no problem with the policies. By virtue of their actions, how can you make the case that theyre not behind the curve . We have been having the conversation for the better part of two or three years at this point. Their economic forecasts have been awful. I went back look at things that fairy had said on squawk in 2014 in prep for this segment and its the same conversation. The fed was behind the curve in 2014. How are are they not behind the curve now . I went and looked back at the dot plots. Theyre always wrong. Its so difficult to be right because number one the preparation goes into it. Theyre already behind the curve when they announce what their forecast is. So i dont blame for that but what i blame for is the language. So we have only had inflation for a couple of months. It was a few months agatha we were talking about, maybe two months is the fed going to go at all this year and now all of a sudden they have to go three times so i would rather have them be patient and take their time than not moving too quickly. How will the press conferences add value to what their Monetary Policy and what the markets are trying to digest . I think more importantly than that is how can you actually go out and say were going to have three or four rate hike ifs what were actually going to do these hikes off of is data . Right . How can they possibly make that case. You tell me how you can buy or sell stocks when the fed says one thing and and whether the rates are going to be here or here, how is this company doing and what does it look like economically for them . How is the value. Somehow the growth . You have to analyze each and every one of these on their own and find the particular stocks. To your point you have to look and see where global marks are because they are dictating the policy for the Federal Reserve. You can have an expectation about whether the federal vef reserve. Why you think the fed should move but you can also make a clear case that the risks are still to the down side in the Global Economy as a reason that maybe they shown. Where the markets are right now or where the markets have been in the last five weeks, no she shown. If youre a longterm fundamental investor ignore the fed was heres whats coming up on the Halftime Report. No so rosey . If the economy appears to be on better foot yg is a top strategist cutting his target on recession fears . Morgan stanleys adam parker joins us. Plus the cole graveyard. Peabody energy may have to file for bankruptcy. The Second Company to do so this week. Is the coal train dead money . And mind the gap. Shares may be up 16 this year but one firm says dont trust the rally. Well debate our call of the day. That and more ahead on the Halftime Report. Sales event is on. With extraordinary offers on the exhilarating is. The thrilling gs. And the powerful rc coupe. This is the pursuit of perfection. You can fly across welcome town in minutes16, or across the globe in under an hour. Whole communities are living on mars and solar satellites provide earth with unlimited clean power. In less than a century, boeing took the world from seaplanes to space planes, across the universe and beyond. And if you thought that was amazing, you just wait. So its the latest company to file for chapter 11 bankruptcy after it skipped a 71 million payment last night on its secured notes. Specifically interest payment. Its exercising a 30 day grace period on that. It says it has substantial doubt about its ability to stay in business and this comes just on the heels of four sight energy saying it could file for chapter 11 bankruptcy if it cant reach an out of Court Restructuring agreement. So all of this speaks to the broader decline in coal. If you take a look at the past two years, at this chart here we have a coal graveyard for you. Theres been five names. Walter energy, alpha natural energy. So these are the names that could be added to that list. Question have seen this for several reasons. We have a trong dollar, the slow down in china hurting coal exports and state side we have regulations and cheap natural gas so if you look at another chart for the eia it shows that it is absolutely eclipses coal fire for the first time in an annual basis ever in 2016. What reverse is that . This is something we have been talking about now for the better part of two years. Heres the reality of it. What you do is you look for who the survivors are in this. Console energy is trading well and theyre a survivor. Another interesting dynamic of this is joy global. Joy global should be down on the news given the amount of cig any can revenue that they generate from the coal industry. Joy global is down today. That tells you that they maybe diversified better than they sould. What about the level of debt that could fall in the same issues that pea body is experiencing today. Theyre loaded with debt. Thats why youre starting to see bankruptcies. One private equity guy is working with ten bankruptcies but lets look through this. Peabody coal and 100 of the stock price. Pea department body went to 7 a share over the last years. Everybody is talking about this major bounce in the commodity cycle fundamentally. Its not happening and this proves it so if you take a look at the others that have a major move im not saying that theyre going bankrupt but they dont deserve to have rallied like they have. They were obviously questions about chesapeakes future over the last few weeks, doc. Yeah, well, btu said february 28th that they had concerns about whether they would be an on going concern and even as they did that you see people like citadel, Citadel Advisors jumping in here and announcing a 4. 5 stake. That stake hurts today but you have to think some people are going to be trying to grab some of this debt rather than the stock. Grabbing the debt in case there is a resurgence or a reemergence of this company but yeah as far as cole goes i loved it a few years ago but its always a trade with me and this one has been straight down for the last, boy, four years or five years. But theres also the political angle to this. This has been an incredibly heavily regulated industry over the last 8 years. A little bit different than i think from some of the energy names and the demise that youre seeing in the coal space i think has a lot to do with the regulation and the outlook that the regulation isnt going to be lifted any time soon. What could potentially turn this around from events and issues hanging over the sector. I have two thoughts on that. The first is its been very regulated but when youre looking at gas under 2, thats been a big part of it. You would be seeing the conversions anyway so on the utility side for coal domestically i dont see this turning around any time soon. The other area to keep an eye on is the coal thats used for steel making. Some folks have been suggesting we could see a bounce in that price because of production cuts in china. Even if you see a bounce which are multidecades low. But thats walter, they were all that. Bhp is another name to keep an eye on. Make that the last word. Thank you so much. Thanks. Coming up, nike is up 27 over the past year and ubs says that rally is just getting started. Theres a herd alert on the desk as well. What side of the trade are they on . I bet you can guess that. Plus go pro getting a bump today and Deutsche Bank is sing sinking. More ahead in the blitz. Wont keep you up at night. Know you have insights from professional investment strategists to help set your mind at ease. Know that planning for retirement can be the least of your worries. With the guidance of a pnc investments financial advisor, know you can get help staying on track for the future youve always wanted. Where selfproclaimed ofinancial superstars , pitch you investment opportunities. Ive got a fantastic deal for you gold with the right pool of investors, theres a lot of money to be made. But first, investors must ask the right questions and use the smartcheck challenge to make the right decisions. Youre not even registered; im done with you i can. I can. Savvy investors check their financial pros background by visiting smartcheck. Gov jake reese, day to feel alive jake reese, day to feel alive jake reese, day to feel alive. Gap was downgraded to underweight on concern haas the recent rally overlooks brand weakness, joe, you actually like the stock . I like the stock but it had a significant recovery from early february. The earnings result in late february. Really the lower tax rate was the benefit for the earnings call. The guidance and the revenue was weak. However that all being said management is addressing the issue. Spring is incredibly important to the prabrand and the franchi. Trying to recreate and focus more on online. So i get the call here. But i mean they use a word that you really dont want to see in a negative note and that being structural. You say that management is making the moves needed. Yes. Their point with that word is that who cares. It doesnt matter. They have structural problems that matter more than anything else. Oh, i disagree with that. I think time has to be allowed for the turn around to happen. Well see what the spring looks like. Well see if the changes in fashion, the fits that gap has talked about if thats going to take hold with the customer base. Lets give them a little time to see if thats going to happen. The stock has rallied 8 from 61 for a reason. Im going to disagree completely. The problem is margins. Margins is number one. Structurally youre right. Even the ceo himself came out and said look we have stumbled on the basics. If theyre stumbling on the basics, why do you think that theres a turn around . Theres no ecommerce growth there either. Youre not talking about a company. When we talk about the retailers we always go to the ecommerce size of it. One of the other names is nike. Ecommerce theyre killing it. These guys not so much. So im not sure what the positive is. A kbree. The ecommerce has not been what you want it to be. But then the structural problems and margin problems. They lost their younger customers and theyre not going to get them back. But everything youre talking about here, management acknowledged on february 26th and said heres the turn around strategy. Your Football Team sucks and if you cant get the right players. And what did you do on that Football Team for the next 8 games . Did you go 62 or 71 . Because gap has. Gap has rallied from 21 to 29 understanding the negative fundamentals. Have they rallied for the right reasons . Because they do think its structure or other reasons. Who knows. Where is the positive that you can point to to say why it rallied . I dont know why it rallied but it did. Theres a 3 yield here. The Balance Sheet is still good so its not going to go down much but they sell commodity goods. Theyre also adikted to coupons. We talked about that on the call today as far as the gap stores, every day i get a coupon for 30 or 40 off. By the time we finished the phone call steven and brie got back to her desk she got a 35 off coupon. Do you think the market is adikted to low rates or zero rates . Gap is addicted to coupons. Lets turn our attention to nike which was reiterated with a buy rating. The firm says it is raising its earnings estimate and seeing bullish trends. I dont know if any of this should be a surprise to anybody. Reiterating a buy just said the thing is great and we know its great and we have managed in the face of. Thats the note. Thats exactly the note. I summarized. Similarly though, when china started slowing down and everybody started becoming more concerned nike continues to kill it. Are they still killing it . Yeah. Its a resilient category to begin with and theyre a very resilient brand. We saw what under armor did. Now i think it continues. Its sold at a high multiple and thats what you pay for a brand with consistent growth. The Chinese Consumer is doing fine. So thats not a reason to sell the stock so look just know that youre paying up for it but its probably going to hold out. And the Revenue Growth when you look at it is absolutely incredible because you take currency out of this whole equation its double digits and were talking about nike and Mature Company and with a monster market cap in the sports agent leisure space and theyre still killing it. Even though the multiple is stretched up there toward 30 theyre still growing and fits very well. Listen in the last six months still reeling. Reeling from what . Fwap has rallied 8. Who cares the reason why it rallied. Nike. Thats crazy. Thats crazy. No its not. Nike in the past has been many over the last six months who attempted to say the top is in for nike. That hasnt worked. By the way, sarah will be interviewing nike Ceo Mark Parker tomorrow at a nike event in new york city. Look forward to that. An interview first on cnbc at 10 00 a. 10 00 a. M. Eastern time. We have a news alert. Lets head to megawith the news for us. Thats right. Regeneron has been halted. News is about a patent dispute over patents for their cholesterol drugs. A u. S. District court jury has just decided in favor of amgen in this at least first stage of this dispute. They are con if i recalling this and they say that the two companies strongly disagree with the verdict that the asserted claims of two amgen patents are valid and they plan to appeal the judgment. Now you can see theyre trading down almost 2 there. Amgen up about 1. 3 . Regeneron is still halted. This could play out over the next 12 to 18 months so could be a long process. Back to you. Thank you so much. European markets are closing right now. Simon hobbs at the New York Stock Exchange has a look. Simon. Hey, scott, markets are lower in advance of a fed decision in 90 minutes time. The banks are a key focus. The ceo said that challenges conditions persist for ubs and no recovery there in Wealth Management or Investment Banking and they suggested a small loss for the year. The u. K. Finance minister delivered his annual budget in which he said that multinationals like google will pay more tax moving forward but the headline coming out is going to put a sugar tax on sodas. Well see if thats replicated around the world. The housing stocks are are higher. George osborne suggesting that they will accelerate the move into affordable housing. You have also seen during the course of the session that the oil and gas stocks are moving higher as well as he effectively aboll ishes the revenue levey there. Meantime they have confirmed their merger. 30 billion. Stocks havent moved today but we had a good run up notably in anticipation. The big question will the owner of this Exchange Come through to break it up. Back to you. Thank you so much simon hobbs. Coming up, Morgan Stanleys adam parker cutting his s p target this week. Now one of the lowest on wall street. He joins us to explain exactly why, next and as we head to break take a look at some of the big energy movers today. Chesapeake williams, south western energy. Are all sharply higher. Were back right after this. Bhap trolling for a gig with braindrone . Cant blame you. Its a drone you control with your brain, which controls your thumbs, which control this joystick. No, im actually over at the ge booth. Were creating the operating system for industry. Its called predix. Its gonna change the way the world works. Ok, im telling my brain to tell the drone to get you a copy of my resume. Umm, maybe keep your hands on the controller. Look out ohhhhhhhhhh. You know what, im just gonna email it to you. Yeah thats probably safer. Ok, cool. Man 1 i came as fast as i man 2 this isnt public yet. Man 1 what isnt . Man 2 weve been attacked. Man 1 the network . Man 2 shhhh. Man 1 when did this happen . Man 2 over the last six months. Man 1 how did we miss it . Man 2 we caught it, just not in time. Man 1 who . How . Man 2 not sure, probably offshore, foreign, pros. Man 1 what did they get . Man 2 what didnt they get. Man 1 i need to call mike. Man 2 dont use your phone. Its not just security, its defense. Bae systems. Im a Customer Relationship my namanager with pg e. Er, ive helped customers like plantronics meet their Energy Efficiency goals. So you save energy and you can save money. Energy efficiency and the environment go hand in hand. And i love how pg es commitment to the environment helps a Community Like santa cruz be a better place to live. And being able to pass that along to my family is really important to me. Just being together and appreciating what we have right here in santa cruz. See how you can save energy at pge. Com. Together, were building a better california. President Obamas Supreme Court pick, judge garland vowed to follow the constitution during todays rose garden announcement. Such trust he or she must be faithful to the constitution and to the statutes passed by the congress. He or she must put aside his personal views or preferences and follow the law. Not make it. A spokesman for House Speaker paul ryan says that he will not accept a nomination for president. The statement follows a political report which quotes former House Speaker john boehner as saying ryan should be the republican nominee if the party fails to choose one during the first ballot at this summers gop convention. And Mother Nature put on quite a show in western illinois. A passer by took this video of a super cell which spawned several small tornadoes. Scary stuff. Thats the cnbc news update this hour. Ill send it back to you. Sue, thank you so much. Our next guest is the most bearish strategists on the street after cutting his s p target this week over fears of a recession. Lets bring in Morgan Stanleys adam parker. Adam, welcome back. Hi. These things come full circle, right . A couple of years ago you were bearish and you got positive. Are you really growing bearish now because of a Recession Risk at a time when it seems as though the economy is move agoway from that . Look, we have been bullish for more than three years. The thesis was that while the base case is mediocre the probability of the bear case seemed low. Thats changed a little bit. The base case is probably still mediocre but the probability of the bull case seems low and theres definitely so risk. Im still pretty constructive on the u. S. Relative to other regions in the world but if i look at my view, Earnings Growth 3 or 4 this year, i pay 16 times that outlook. I get to 2050 so thats how we think it pans out. Its harder to be as optimistic and stronger dollar and lower oil and lower ten year yields and lower economic output and thats what my colleagues around the role of forecast in the previous areas. Im not saying that there arent risks obviously and it does seem as though if anything the risk is more to the down side than not but im just, i guess, a little surprised that were talking about this now when eight piers that maybe the economy is actually move agoway from the recession fear than toward it. Look, scott, these are mixed. I remember being on this network a month ago and i was trying to argue it was mixed and not negative and i felt like i dumb bull and when i talk to investors now and hear this i almost feel like im a slight c contrarian bear. Its not that great. Markets up 10 from february. Were off total return from an all time high. These are fine. The question is whats a negative catalyst in the next couple of weeks in this vacuum of data. I dont know. Its interesting how we would have thought a vacuum of data is bearish and now its like it will melt higher until we get april jobs or earnings news. Im not saying lets run and short the market but i think that were closer to fair value given this big run that we had and a backdrop thats probably relatively better for the u. S. Than in other parts of the world but still real risks out there. Im wondering if youre trying to get ahead of the fed and thinking that the fed is going to move this late spring or summer and that the market is going to fall out of bed as a result of that and have a hard time dealing with it. The main risk that we see at Morgan Stanley are the chinese economy could deteriorate the second half of the year. Every u. S. Equity investor was magically worried about china devalue withdrew wags in the economy and now theyre come place sent given the market rally and two, the strong dollar. Our currency strategist is a dollar bull. So you get back on that train and that could start impeding earnings a little bit so those are the two main reasons to be worried. Obviously if those dont turn out to be right you could see a little higher equity market. Things are more balanced risk reward wise here on given the big market move. Earnings are okay and the consumer is okay but im setting up my portfolio thinking about things in three buckets. Theres defensives and growth and unknown area which are financials in energy and i have to own a little bit, be overweight and underweight a little bit to avoid taking too much risk on dollar rates and oil. Thats the key. Okay. Adam, two of your overweights, health care, financials, down 7 . Down 6 . Obviously being impacted by the upcoming election. What are you telling clients as it relates to this election and how concerned are you for the impact on the s p this year . Look, i mean, i dont think any candidates appear to be massive multiple expanders at the current moemtd on either side to say that in a politically neutral fashion. I think theres risks. I think you could argue that theres certain areas that the markets sold off too much. Maybe drug pricing wont be perhaps under a democratic regime. So i think its tricky. Earnings are likely to grow here in the u. S. And that may make it better than other regions in the world. Every asset on earth thats defensive looks expensive already. If your question is should i buy defensive stocks . The challenge is theyre really defensive so my sense is i better own some. I like utilities over staples because i dont think that im overpaying for that stability on a relative basis. But if the ten year yield would out perform and i think the utilities look cheaper. Same thing on growth. I probably have to own some growth in case were paying premiums again i think tech looks overvalued there so a little bit more cautious and this unknown thing is financials versus energy. Its really hard to forecast the ten year yield and the oil price. I like the financials more. The prices as you indicated are really cheap. The companies returning to the share hold cher is the opposite of whats happening in energy. I honestly think this Energy Material low quality rally has been more 80 positioning and 20 of fundamental ill provement. The fundamental improvement probably fades some and this is a cell to rip and not the buy the dip mentality there. We talked about the low quality and the dash for trash and Short Covering nature of what brought a lot of the sectors back and adam i dont know if the market which is ticking a little lower as were having this conversation is reacting at all to what were saying, thats anybodys guess but do you noe think that its possible that we go back and retest that low of 1810 . Look i think thats possible. I do. You still think. Theres more down side to the bear case than there is upside to the bull case. Absolutely. If youre look out 6 to 12 months the question is are you comfort wbl the European Economic directory. The path, the brexit . Are you comfortable with chinas second half of the Year Economic growth and do you think that thing versus stabilized . Probably not. My sense is and a lot of investors agree well probably have volatile up 10, up 8, town 8 path to nowhere and in the end youre flat and had the volatile moves. Shouldnt i be more cautious now with a 10 move since february . Things werent as bad as the market told you in january and things arent as good as its told you since. The truth is probably somewhere in between and you have to be selling these big moves and being more tactical and positions youre with some growth, some defense and some of this kind of Financial Energy just to make sure that you dont basically you can out perform in every regime. Thats the goal. Hard to make an argument. I really appreciate the conversation. Good to see you guys. Take care. Dr. Adam parker. Coming up, the day after valeants huge loss. Meg along with the latest on the troubled drug maker and over one hour until the fed, were heading for the futures pitts. Ahead of the big decision. Halftime report back after this. Everhas a number. Olicy but not every Insurance Company understands the life behind it. For those whove served and the families that have supported them, we offer our best service in return. Usaa. We know what it means to serve. Get an insurance quote and see why 92 of our members plan to stay for life. We are counting you down to the feds decision on Interest Rates right at 2 00 p. M. Eastern time and followed by the News Conference from janet yellen. We have a huge lineup for you. Bill gross, scott maynard, theyre all going to join us preview the number and break down the results afterwards. All gets underway at the top of the hour. First back to you scott. Well see you soon. The yield on the ten year is hitting the highest level since late january. Jackie at the nymex with the futures now crew threatening to go over 2 . Looks like it scott. Good afternoon to you. Its ticking higher today ahead of the fed announcement this afternoon. Whatever the market is expecting is priced in. It is. If and when they do raise in april i dont see much, a spike in yields coming. If you look at december that didnt happen and these yields are too attractive to the rest of the world to ignore. Bill, flirting with 2 . What are the levels youre watching here and which way do you think we go . A lot of this is being priced in. The fed is painted in the corner of having to be hawkish here. Its a nice grind lower in the futures pricing creating a wedge. The market starts moving higher and yields go lower. The ten year treasury gets out above 128. 27. Its going to break out of the descending wedge. Look for a bullish leg higher and thats going to be a move that can be sustainable. Well be watching very closely. Meantime for more on the futur s market head to futures now. Nbc. Com. Double the trade. John and pete are making moves in the halftime portfolio competition today. Stick around for the game plan next. Here at td ameritrade, they work hard. Wow, that was random. Random . No. Its all about understanding patterns. Like the mail guy at 3 12pm every day or jerry getting dumped every third tuesday. Jerry every third tuesday. We have Pattern Recognition Technology on any chart plus over 300 customizable studies to help you anticipate potential price movement. Theres no way to predict that. Td ameritrade. Were back on the halftime repor report. Shares of valeant stabilizing today. Meg terrell following the latest details. Thats right. So while the stock price is stabilizing today, the outlook doesnt seem to be stable at all. Just this afternoon hearing from s p that it is put ing its debt watches under a credit watch. Saying that there is a preponderance of risk in the near term that could further weaken credit worthiness. The debt is really the near term concern here with valeant. They gave a timeline for when they need to file their 10k to not trip any covenants on the debt. If you look at the timeline, between 30 and 60 days is when they have to get that 10k in. They say they will negotiate with their banks in order to try to get a waver. Mike pierson saying they hope to file in april but dont know. So this is the nearest term worry people have on valeant. The other sort of tangential story is if you look at pershing square, losing a billion dollars just one day on that 50 drop yesterday. I think we have some of the top holders here, the to have five. You can see the oneday losses that they accrued. Were still showing our no, thats me. Were still showing our value act is another obvious well known name in the top five. There is the list there. John paulson at the bottom of your list, pershing, the second largest shareholder. What is amazing is as you mentioned the debt, the debt is nearly three times the market cap at this point. Yeah. Thats stunning. We have been seeing comparisens of all of the acquisitions they have been doing, if you add up how much they spend in acquisitions and then market cap, market cap is much less than they expend. It is still not a very flattering ratio. So folks are very worried about what is going to go on here. It is not just the debt, not just the outlook that looks weird, people are starting to worry that employers will leave, doctors are not going it prescribe their drugs because valeant is becoming notorious and people are worried they wont do their business. Meg, thanks, meg terrell with the latest on valeant. Up next, brother versus brother. Jon and pete making trades in the halftime portfolios. We count down to the big fed decision, one hour, six minutes, less than 20 seconds. The Halftime Report is back after this. We were born 100 years ago into a new american century. Born with a hunger to fly and a passion to build something better. And what an amazing time its been, decade after decade of innovation, inspiration and wonder. So, we say thank you america for a century of trust, for the privilege of flying higher and higher, together. Frank abagnale. Convicted felon and con man. That was a long time ago. You know, they made a movie about it. You were shown to be quite skilled at fraud. Times change. Now i help catch the bad guys. Me too. I help banks detect fraud by applying cognitive analytics to public financial records and social media. So if somebody said, catch me if you can. . We can. Lets do a sequel. It could be a buddy movie. I would like to have a buddy. Take a look at the leaderboard in our halftime portfolio competition. John lebenthal in the lead with a performance better than 11 . Jon najarian making trades today. What are you doing . Sold out of half Energy Transfer partners ete. Stock up almost 7 this morning. I sold half of that position, judge. Sold all of my devin energy because it made a significant pop of, i believe, also about 6 , 7 . And closed out rio, materials company, just wasnt doing anything. If they dont do anything for me in 48 hours, judge, theyre out. See you. What about you, pete . I made i decided to put a pharma name to work for me, risky right now, but the election is a little bit ways out. I put in bristolmyers. I love the innovation and the Strategic Partnerships they made, some acquisitions they made as well. I look at the pipeline. I think it is an incredible pipeline going forward. If you go out a couple of years, not for the portfolio for my portfolio it is, but out a couple of years, talk about earnings potentially doubling and revenue close to doubling as well, there is a lot of reasons to like this name now. Somewhere jim cramer is smiling. Bristolmyers. The june 67. 50 call is what put me in it. Suddenly 10,000 of the june 67. 50 calls were purchased around a buck, a buck 55. I love what im seeing there. Im not saying the stock is going to that level right away but out to june, plenty of time. Ill probably hold on to these for a couple of weeks. Anniversary of mad money tonight. Were running a twitter poll and have been throughout the show on whether the fed lost its credibility or not. Current vote, 62 say yes. 38 say no. Continue to vote. Go to twitter halftimereport to weigh in. Want to mention, twitter, the stock itself got a positive mention today at goldman sachs. It is higher on the day as a result of that. Pete, you were taking a look at this. They put a price target i think i saw the price target was 40. I believe thats what i saw in this note, but stock is turning 16, and just hasnt been able to get out of its own way for a long, long time. Got up to 19, pulled back. Dont chase this thing until jack gets this thing turned around the right way. What is the im holding it. Oin i own it. I own calls in fedex. Right now, judge, im holding it into the earnings tonight. Okay. And last but not least, crude oil, at the highs of the day today, we wait for the fed and the decision in about one hours time. Crude oil is up 4 today. Interesting. But i still think it makes a run toward 40. Thats where the pain is. Last thought. No way to judge it. I think crude is okay here. But it cant go lower, cant go higher. Who knows. See you tomorrow. All of you as well. Power lunch starts right now. Thank you very much. Welcome, everybody, to power lunch, where in less than one hour from now we will get the feds latest decision on Interest Rates. Will they hike . The markets betting they wont. But, of course, anything can happen. Welcome again, everybody. Along with melissa lee, Michelle Carusocabrera and brian sullivan, im tyler mathisen. Lets get a quick check on the markets as we look first at the dow. It is in negative territory by the slimmest of margins, 24 points. West texas crude up a little bit by 1. 52, more than a little bit
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