Our road map begins with the retail surprise. Best buy, sears, Williams Sonoma, all with earnings beat. Shares of best buy are surging. And Mickey Drexler is explaining how the j crew market missed the tech revolution. The s p is on track for another fresh record close. Opec agrees on the cut extension and oil is down. A lot of news on the retail front. Best buy is up, helped by an unexpected increase in u. S. Comps. Williams sonoma is out with better than expected guidance and earnings beat and then sears coming in above forecast. Although sales continue to slump. Its not often, jim, an 11. 9 decline in comp is actually above expectations. Yeah. Look, sears is a big short squeeze whenever it goes up and people realize well, wait a second. Even when they keep selling Closing Stores the existing stores have bad numbers. These are terminal numbers. I mean, i wont tell you that maybe you can close all of the stores and see the stock go up. But i have never i mean, there has never been a return to any great growth from double digit and including jcpenney. Jcpenney is hanging on. Right. Its helping the stock today. Of course we talk about the fat market cap wise, this is a tiny company. But to your point, kmart is down 11. 2 . These are significant numbers when you look at the revenues overall. 4. 3 billion in revenues for the quarter. The same store, 11. 2 decline and sears was 12 decline. This years stores. Yeah. The cfo at home depot calls sears a shared donor. When you look at the categories that are doing well at home depot they are categories that are shrinking rather rapidly at sears. I did a big twitter poll that talked about how many people are worried about buying something at sears and not being able to return it because the store closes. And there are issues. But in the meantime, Eddie Lampert has proved adept at one thing which is to keep it alive. This is david blaine of retailers, right . David blaine. I guess. Hes a very good magician. He doesnt do just rabbed byes out of the rabbits out of the hat. When i saw him it was supernatural and he said, no its sleight of hand. Like elon musk he takes aim when you believe in. But i believe the important take away is best buy. People were shocked at best buy, why . Because if you listen to the target call they talked about the Nintendo Switch driving electronics which had been a weak part of their business to minus 9 and the switch is called out again on best buy. Again, dont forget gaming. Gaming is so big. We dont talk about league of legends enough. League of legends what . Im ready to talk about it. Im sorry we dont enough. I was learning in the final four, Robert Morris in illinois, they have a big team. Its a college. They have a big team theyre the ones who recruit they have a big stadium. Take two interactive owns all the nba teams. The Boston Garden sells out, thats part of this best buy revolution. Best buy is so nonpromotional i have to do it for them. Except in the press release and they tell you they reported better than expected First Quarter results. Thats for us, not for you to do, best buy. Just give us the numbers. Dont tell us theyre better than expected. The headline did not jive with what i was thought not too early overly optimistic. It is going to send up gamestop. It will be incorrect. But this Nintendo Switch i have to get it this weekend. I really do. Theres a surge in pc sales. We got that from hp. This is a wacko time. Amazing week. You know, we had autozone and tiffany and all the other weak reports. Today weve got a raise in guidance from best buy, from pvh. And from Williams Sonoma. In your house, well do anything Williams Sonoma numbers i have to tell you this west theyre on fire. They are now talking about the brick and mortar, i love brick and mortar is a source of value added services. A source of inspiration. They are going trying to be all digital. They increased a lot they have the stores. But theyre opening up a flagship store, were going to do that. Were going to go with credit cards blazing. To your point, you can do most of it online. You do have to put it together a little bit. But otherwise get ready for the term aggressive shopping because thats what you and i are doing at the end of the quarter. You talked to chirico last night . Oh, my, double digit comps in europe, germany, so france. Britain. We are talking about Tommy Hilfiger, calvin klein, starting to see some good numbers in china. Heritage. This was something that was so confusing. You know, that izod. The old stuff. The heritage stores, they comped at zero. But thats a big turn. U. S. , no. Hes talking about the need for having fewer Stores Including some big stores hes now saying dont get theres a changing landscape very rapidly. Yeah. Lets take a listen to what manny told jim last night on mad money. All brands are performing, you know, pretty well. You can see it in the heritage numbers. And were pretty bullish about the heritage business in the Second Quarter. I think the key in this market in the u. S. Is to manage your inventories tightly as well as your expenses and you have to recognize that were going through a Seismic Shift in the retail distribution channels. Speaking of which well talk later this morning about what Mickey Drexler told the journal, how digital changed retail and how he wished he could go back ten years and do things differently. Well, kind of like superman when yeah. Turns the world but manny is a business man. Im not denigrating manny you know, mickey is a business but manny understood that if he got caught with too much inventory in this system there would be a big football. You would see all of their calvin klein and Tommy Hilfiger in the discount channels. Under armour did not control its inventory well. Theyre like flooding the discount channels. Keep them out of the discount channels, dont lower your price points and then some of the numbers were down five in the u. S. , they did not get caught and Tommy Hilfiger, i dont know if you have been to berlin. But i happened to take a place that was next door to the hilfiger store and there was a line when it opened. Each morning. A line for Tommy Hilfiger. And thats this is a premium, premium, premium brand in europe. The numbers are extraordinary and the Gross Margins are great. Manny chirico keeps the inventory down in the u. S. , has plenty in europe, and i think its lasting. You have to buy the stock even up here. You can forgive investors if theyre a bit confused by the retail landscape. So hard. Because this morning here we are talking about very positive things. With the likes of course of best buy. Yet, we also spend so much time talking about the decline of the mall. And there being no untouched retailers within the mall at this point. Even tiffany yesterday. Tiffany. That was not mall related. Footlocker did not make it. Williams sonomas in malls. But its housing. Go back to the home depot call and what they were saying. People want to make their housing their houses, they want to invest in their houses. No longer an expense. Look, i know that people there are shorts and longs on this wayfair. But furniture is selling well. Remember when this was a big insider buy by gary friedman, restoration hardware, that stock doubled. Furniture in the home, making your home great. Putting new paneling, im doing remodeling in the home at summit. We are going double digit shopping for my remodeling. I promised lisa. Its a big job. If you go to rh, it will set you back. Rh crushed us when we did our bathroom. Rh. We got annihilated but it looks great. Lisa, youre really terrific. I told gary friedman, youre credit. She doesnt watch the show but thats okay. The dogs watch the show more closely than she does. Well take about retail, one of the big stories of the day. And along with a winning streak, five straight days. The s p is going to go for six. Just off of an alltime intraday high. Then theres oil. Opec delegates saying that the cartel has agreed to extend cuts nine months. Would they go 12, is that why were selling off a little bit today . Look, i dont know. These are not the cuts you need. The u. S. Russki brazil, thank you so much. Do you think the gulf of mexico is coming on strong. After mccondo, there was a big pause in drilling and now the big chevron wells are coming in. Youre producing a couple hundred thousand barrels per month. None of the guys in opec are ready for it. The elephant in the room is the permian, gulf of mexico, they dont get it. Theyre caught flat footed. Opec were back to 9. 3 Million Barrels a day. Up as you have been pointing out. Well see the rig count tomorrow. Most important, this seems to have come out of to plunge of oil prices is the shale producers ability to get it out of the ground more cheaply. Not that theyre all profitable because theyre not. But capital is continuing to flow into the industry to allow them to keep moving and bringing that break even price down. When we get three pipelines from the permian, we are going to see a level of pumping that you wouldnt believe. Im going to say it right here, right now. Opec, it has no mojo. The headline is shale drillers one, opec zero. Look do we get to 10 million a day . Easily. Well get to 10 million. Look, there are Oil Companies that are literally keeping oil in the ground because theres not enough pipe. There are pipe there are three proposals right now. People are worried they dont like to do the pipes until theyre absolutely full. Dont forget, President Trump has expressed the desire to pretty much pipe everywhere. Theres pipes trying to go through pennsylvania and new jersey and there are some people who are trying to stop these and they are having luck. But in texas, piping is david, its live free or pipe. Thats not new hampshire. Thats texas. Got it. Different state. Different pipe. Well talk more about crude later on this morning. When we come back a bit more on j crews Mickey Drexler. His confession about tech. Later on, matthew shea met with mnuchin to lobby against the border tax which has a few more headlines today suggesting its taking another hit. Look at the premarket. All three indices up for the month. And the dow and the s p have wiped out their losses from last weeks selloff. Say carl, we have a question about your brokerage fees. Fees . What did you have in mind . I dont know. 4. 95 per trade . Uhhh. And i was wondering if your brokerage offers some sort of guarantee . Guarantee . Where we can get our fees and commissions back if were not happy. So can you offer me what schwab is offering . Whats with all the questions . Ask your broker if theyre offering 4. 95 online equity trades and a satisfaction guarantee. If you dont like their answer, ask again at schwab. I need the phone thats where i happen to be. To be the one that rings. I need not to be missed phone calls. To not be missed. I need seamless handoff. Canyon software. From reception, to landline, to mobile. I need one number. Not two. Im always moving forward. Because i cant afford to get stuck in the past. Comcast business. Built for business. J. Crew ceo Mickey Drexler said he underestimated how quickly technology would change the retail business. He said, quote, i have never seen the speed of change as it is today. If i could go back ten years, i might have done some things earlier. You cannot be successful without being obsessed with the product, obsessed with social media and obsessed with digital. Retail is now about all of that. Goes on to say he thought the brand became too elitist. Gave people the impression they were too expensive. Well, mickey was very selfflag youtory in the piece. I think any single retailer could have said the same thing. I think he was uniquely on the hot seat because the apparel ones were they were meant to be individual. People felt that apparel somehow would get unscathed and mickey was not alone. But mickey is selfeffacing enough he takes it on. He beats up a lot. It was five years ago that we debuted a documentary on drexler. A successful career. They were pushing of course at the time the high quality of their goods and pushing up the price points. Clearly something that they now regret having done. Yes. Maybe moving away from some of their core customers in terms of their own price point. But also, even though they obviously had an online strategy not being enough. Not to mention and we have heard this from him many times, the mall, the mall. He was one of the first people to criticize what was going on inside the mall. Where were you going to go . I mean, this is if you read the complicated, twisted, but positive Williams Sonoma conference call, you will see that they have spent a for churn on digital. And mickey did not do that in part because it was about the eyes. See, mickey has an eye. He knows what we like. But you know what . Amazon is Artificial Intelligence. They know what were going to like. Mickey knew what we liked. They skate not where the puck is going to be, they skate right into the goal. Thats amazon. Theyre going to have robots building robots and well have nothing. Mickey emphasized there was a joy of shopping and a joy of going and touching and feeling merchandise thats completely gone away. Yeah. Something that delighted you . Right. One of the things i want to reference because its this morning, but Williams Sonoma, what are they doing, theyre doing virtual reality. If you want to see what your house would look like with a piece of furniture, mickey w was mickey is about hey, wow, look at that. But hey, wow look at that if youre not at the mall, no one is hey wowing. You go into the mall, you get the one thing, you get the Nintendo Switch and you go home. From the financial perspective, j. Crew has had many consecutive declines in samestore sales. It is a leverage buyout of some vintage with at of debt on it. So it is a precarious financial position that j. Crew finds themselves. And having succeeded enormously the first time they took it private, installed mr. Drexler and then took it public again. But this time it didnt go according to plan given these seismic changes that we talk about so often. Mickey taught me over and over, inventory, inventory, its the bane of the existence and the sin and Manny Chirico figured out the inventory at pvh. You go into zara, you have to go inin and they opened one not far from here. The minute i get a call from the sales person, lisa is going to love this. The supply chain, watch ralph lawyer within the new supply chain from salesforce. This is remarkable. Did you just say your zara salesperson called you . This is her right now. No, im not kidding. She says, lisa will love this. You have something new . Shell love it. My jimmy choo salesperson used to jimmy choo, come on. Choos are unbelievable. She moved on. I dont see you wearing jimmy choos very often. I dont wear it. It was all about toe cleavage, its on the new ones. Mickey was on apples board. He was not a technological luddite. How much should he have seen . A very good question. I know he was willing to stand up to steve jobs, one of the few in the world. This was about apple didnt see he did apple didnt see it. Now right now, youre finally getting Artificial Intelligence for the other guys but amazon knew that you would not like that knit item. They knew that knit wasnt going anywhere. Zara figured out what youll wear three weeks from now even though they know six weeks from now youre not. Youll come with me to zara. It will blow your mind. We have to meet i want to meet your salesperson. I got a coat for lisa. You wouldnt believe it. Okay. Always lisa has seven birthdays a year its incredible. Well get cramers mad dash. Well look at the premarket on a thursday morning. More squawk on the street in a moment. Nobody does underwater stunts, sylvia. Except me, of course. This is my stop. Adios if youre a stuntman, you cheat death. Its what you do. If you want to save fifteen percent or more on car insurance, you switch to geico. Its what you do. Numero uno i count on my dell small for tech advice. With one phone call, i get products that suit my needs and i get back to business. With e trade you see things your way. You have access to the right information at the right moment. And when you filter out the noise, its easy to turn your vision into action. Its your trade. E trade. Its been over 100 years since the first stock index was created, as a benchmark for average. Yet a lot of people still build portfolios with strategies that just track the benchmarks. But investing isnt about achieving average. Its about achieving goals. And invesco believes doing that today requires the art and expertise of highconviction investing. Translation . Why invest in average . W. O. W. Is going public today. See how that stock does. Were talking about the Washington Post in the mad dash not because we want to talk about the Washington Post and jeff bezos, but theres something you want to look at. Remarkably the maryland Terrapin Team is doing fabulous in the league of legends even though they dont have their own stadium and athletic director. You see irvine, this Robert Morris illinois, david, this is sweeping the nation. Logitech might have one tonight. You cant win without logitech because their boards are quic y quickly theyre about like an eighth of a mill asecond faster. This is the sport that take two is dominating. They own all the nba team rights to ea sports. Get the Washington Post and read it today. This e sports article will explain how incredible this is sweeping the nation and david, league of legends, who is it owned by . Tencent. What is the object of the game . Do we happen to know . To win up. Thank you. To win. Got it. But anyway, logitech has been up 44 . Take two has got i think that the