tv Worldwide Exchange CNBC March 16, 2016 5:00am-6:01am EDT
good morning. it's decision day for the fed. no policy change expected, but that doesn't mean there won't be plenty of market drama. the big question, what will janet yellen say about the future? decision 2016, hillary clinton and donald trump add to their win columns, but new this morning, a victory by john kasich in ohio raising all kinds of questions about the possibility of a contested convention. and a stunning blow to investors. well-known hedge funds lose more than $5 billion in one day as valeant suffers another stock rout. it's wednesday, march 16th, 2016. "worldwide exchange" begins right now.
good morning and welcome to "worldwide exchange" on cnbc. i'm sara eisen. >> and i'm wilfred frost. a packed agenda this morning, from markets to election season mayhem. we have it all covered for you over the next hour. let's start with a quick check of the futures board. our u.s. futures, of course. yesterday we had the slight negativity, low volumes. we've had the two lowest volumes of the year to start off this week. today we're expecting a slight bounce. the dow by 24 points. with those low volumes, you could certainly say we're treading water ahead of the fed's decision. >> happy fed day. among today's top stories, the race for the white house. the results are now in from yesterday's key primary races. call it super tuesday 2.0. on the gop side, donald trump winning four of the five states, but ohio governor john kasich pulled out a victory in the buckeye state, capturing 66
delegates in that pridze, winne take all contest. meanwhile, senator marco rubio announcing he will exit the gop race after losing him hoe ininge of florida. on the democratic side, hillary clinton marching closer to her party's nomination, sweeping bernie sanders in all five of yesterday's contests. much more on the race for the white house, where we go from here, including the possibility of a contested gop convention. we'll tell you what it means, get you up to speed, go back to the history books on what happens in that scenario if, in fact, the chances are increased this morning. >> much more debate on the political side to come. first, today's top market story. the central bank is seen holding rates steady, of course. policymakers will also issue new economic projections. an announcement due at 2:00 p.m. eastern followed by a janet yellen news conference half an hour later. ahead of all the fed events, plenty of other data to digest. the consumer price index is out.
the call rate, which excludes food and energy, is forecast to rise. 8:30, look for february housing starts, which are expected to rebound after falling nearly 4% in january. at 9:15, we get february industrial production. fedex reports results after the closing bell. this comes after disappointing retail sales yesterday. >> let's show you the global market picture this morning. strength in the action of european trading, reversing a decline from yesterday. building on those gain, the german dax is up 0.6%. the leader in the region, except for italy, up almost 0.75%. all after losses overnight in asia. kuroda continues to jawbone, saying we could look into cutting rates further, more
action. that's weakening the yen. though, the japanese nikkei did close lower. >> kuroda is going to join us on the show if we don't get his name right. >> what did i say? >> you slightly butchered it. >> janet yellen, also join us on the show one day. let's have a look at broader markets. they've been key for sentiment so far this week. today we're pointing higher, as are u.s. futures. you can dra what conclusions you like from that. the correlations remain strong. let's look at the ten-year note as well. just seeing the yields tick up a little bit ahead of the fed decision. 1.95. we've been in that range for some time now. also look at some dollar pairs. sara already mentioned we've seen the u.s. dollar strengthen against the yen today by about 0.4%. a little bit of dollar strength also against both the euro and the pound, as you can see. gold, what is that doing ahead
of the fed decision? it is up a fraction at 1232. >> bottom line for the fed, no policy changes expected. it's all going to come down to the communication. what are we going to hear from the news conference from janet yellen? what are we going to see from the forecast of the fed? everybody talks about the dots. the reason it's such a big deal is because last time we got word from the fed in december, they expected four increases in interest rates this year. that should come down along with market expectations. we'll see what they say about the economy. we'll also see how the market interprets it. >> right, how many rate hikes we expect this year and when is the first one going to come. if it's not in march, could it be as soon as june or further down in the year. >> and how she communicates that and whether it's just too much communication. we also have deal news this morning. the london stock exchange group and deutsche borse revealing an
all-share merger. the firm is expected to maintain its headquarters in london and frankfurt. deutsche borse's ceo would assume the chief role at the new combined group. >> interesting story continuing to develop. still ise sitting on the sidelines. >> will they come in? >> the brexit vote coming up as well, adding a little political spark in the u.k. papers. interesting story to keep an eye on. let's have a look at some other stocks to watch today. chipotle announcing its comparable restaurant sales fell more than 25% last month after all of those food safety incidents. the burrito chain also saying it could lose up to $1 a share or more in the first quarter. sony delaying the release of its playstation virtual reality system by several months. the move gives rival like oculus a head start over the next few months. flat today. oracle posting earnings that topped estimates, though sales came in below consensus.
the firm also announcing a $10 billion share buyback, up 4%. a food and drug administration panel has backed a heart stint that dissolves a few years after it's implanted. that stock down 1.5%. baxalta unveiling a secondary stock offering. the shares held by baxter international will be exchanged towards debt with lenders. aetna expects to complete its acquisition of humana in the second half of this year. the stock everyone is still talking about this morning, valeant. hedge funds losing an estimated $5.3 billion. shares plunging more than 50% after valeant said it risked defaulting on its $30 billion of debt. among the biggest losers, bill ackman and jeffrey ubban.
smaller hedge funds could go under as well. we'll have much more on this extraordinary story with cnbc's meg terrell later this hour. >> the hedge fund story is unreal. ackman giving up almost $800 million in one day from his stake. paulson, less than half a billion. >> massive credibility questions. >> and how did it all go wrong? meg will join us, as wilfred said. but we start with politics here. hillary clinton is a giant leap closer to securing the democratic nomination. on the gop side, more confusion after donald trump wins four states. we have a great panel of experts to weigh in this morning. we've got sara fagan with us, who's a cnbc contributor. but first, though, we want to go to tracie potts in washington to review some of the results from yesterday. >> thank you, florida.
thank you, north carolina. thank you, ohio! >> reporter: those three states plus missouri and a more narrow victory in her home state, illinois, leaves hillary clinton with more than 1500 delegates this morning and a clear path to the nomination. bernie sanders is already in arizona for next week's primary. >> we will win if the voter turnout is high. let's make it high. >> reporter: donald trump won every state but one, even with the violence surrounding his campaign. >> you explain it to me because i can't. my numbers went up. i don't understand it. nobody understands it. >> reporter: losing florida to trump was the last straw for marco rubio. he's out. >> after tonight, it is clear that while we are on the right side, this year we will not be on the winning side. >> reporter: losing ohio to john kasich means trump needs nearly 60% of all remaining delegates to avoid a brokered convention. >> we're going to go all the way
to cleveland and secure the republican nomination. >> reporter: ted cruz is hoping to make it a two-man race. >> america now has a clear choice going forward. >> reporter: but apparently not an easy one. exit polls show that there could be trouble ahead for republicans. more than half the voters in florida, ohio, and north carolina voted for a candidate other than donald trump. more than half of those in florida said if he's the nominee, they'll look at a third-party candidate in november. tracie potts, nbc news, washington. >> and that raises all sorts of questions on this wednesday morning. joining us now to talk about it from washington, we have stand colander and sara fagan. so stan, do we have to go back and look at what a contested convention means, what the rules are, have the chances increased for the republicans this morning?
>> well, i mean, they certainly haven't gone away. the report you just heard said donald trump's got to win 60% of the votes to avoid a contested convention. if he gets even close to that, it'll be difficult to deny him at the convention. the interesting thing, and i'd love to hear what sara has to say, is it's now an effort to deny him the presidency. this could be a really long haul for the republicans and donald trump. >> sara, what's your view on that? >> well, i don't think that if he walks into the convention with the requisite number of delegates, which is 1,237, if he has that number, that magic number, he's not going to be denied the nomination. he may be denied the presidency by the voters. but if he goes to the convention and hasn't secured the number of delegates needed, i do think that we're going to be in an open convention situation. the party faithful, the folks who have been working in the
trenches for 20-plus years who go to these conventions, are not likely to work to put him over the top. i think someone else will emerge as the republican nominee in that situation. >> sticking with the republican side of things, lots of focus on the fact that john kasich, of course, won his home state, and it was of course winner takes all. but he didn't get 50%. this is his home state. so how significant, really, is this? is he going to get much momentum from this, or is it a nice single big victory for him and in a couple weeks' time it'll seem irrelevant? >> i think that remains to be seen. he is on paper probably the best candidate in the republican field of the 15 people who ultimately ran for the nomination. he hasn't brought people together yet in a major way behind his candidacy. last night was a good jump start. more importantly, he's really the more mainstream republicans' last hope. so i do think you'll see a rallying cry around him.
but he has yet to prove that he's able to win any of these major contests. so he has to -- the key for him going forward is he's going to have to have a big night in arizona next week. if he does that, he can walk into the convention at least with the moral victory, perhaps with enough energy behind him to emerge in a contested convention. but he's not going to walk in with enough delegates to secure the nomination outright. >> so clearly, stan, on the democratic side, hillary clinton was a big winner last night. does marco rubio's exit also help clinton? she had a pretty good night overall. >> well, she had a very good night. the only exception being missouri, and that was even close enough that she denied bernie sanders the ability to claim a victory, even if he wins by a percentage or two. but, you know, at this point, the whole clinton campaign is going to have to change, to
start talking about the general election in november. you saw her focus her remarks last night on donald trump. i suspect a lot of discussion now will be on vice presidential candidates, who can energize the voters in a way that will make up for some of her deficiencies, maybe a couple of states. that's where the whole discussion will be at this point. she's not quite coronated yet, but she's very, very close. >> and sara, which republicans will you be watching closest between now and the convention to see if the party can really get behind donald trump or not? >> well, i think there's probably four people you would watch at this point. you certainly would watch donald trump. does he get to that magic number. doesn't look like he can, but there's still many contests ahead. watch john kasich. is he somebody who can get energy behind his candidacy and start to build momentum going into a potentially open convention. of course, ted cruz has run very
strong, almost won missouri last night. did well in some other states. he plays an important role as a foil against people who don't want donald trump -- poor people who don't want donald trump as the nominee. and then the fourth person i would watch is sort of the grant figure of the party, the paul ryans of the world, the pmitt romneys. does one of them emerge and said, yes, i would put my name forward, if donald trump doesn't get enough delegates. and is there a huge rallying cry for somebody who plays a the a different level than the candidates we're seeing now. >> and on that note, we have an interview with house speaker paul ryan from our own john harwood. he's going to bring that to you at 5:30. we'll leave it there with that tease. thank you very much, both of you, for getting up early and for talking us through the results. still to come, today's trade of the day. how can you play the fed? >> first, today's business birthdays. we also want to pass on our best
wishes to bank of england governor mark carney who turns 51 today. he's the first non-britain to hold this role since 1694. he's also a long distance runner, completing the 2015 london ma london marathon in just over 3 1/2 hours. and he's young for a central banker. >> not bad for 51. hope he's having a very nice birthday. >> happy birthday, governor carney. sed to the smell of lingering garbage... ...in her kitchen yup, she's gone noseblind. she thinks it smells fine, but her guests smell this. ding, flies, meow febreze air effects heavy duty has up to... ...two times the odor-eliminating power to... ...remove odors you've done noseblind to [inhales] mmm. use febreze air effects, till it's fresh and try febreze small spaces... ...to continuously eliminate up to two times the odors... ...for 30 days febreze small spaces and air effects, two more ways...
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welcome back to "worldwide exchange." today's corporate stories, apple filing its final legal brief before a court showdown with the justice department next week. the tech giant argues the u.s. founding fathers would, quote, be appalled by a government request to unlock an encrypted iphone. apple says congress has declined to give the doj the authority to help it access the phone used by one of the san bernardino shooters. >> the drama goes on. in washington, president obama is expected to announce his pick for u.s. supreme court nominee as early as today. he's li-- senate republicans ha said they will not hold confirmation hearings or an up-and-down vote on any of his nominees. the morning and evening commute in the nation's capital could be a mess today as the city center subway system is completely shut down. the metro is closed until
thursday at 5:00 a.m. eastern for safety inspections after recent fires. the system is normally shut for five hours overnight during the week. the shutdown won't affect washington's bus service or new streetcar line. the federal government and public schools are open. the metro carries an average of more than 700,000 commuters on weekdays. but uber and lyft have announced plans to accommodate extra passengers during the shutdown. uber is capping surge pricing in the area at 3.9 times base fares and will offer a $25 credit to new users toward their first ride. lyft says it will offer new users $20 off during their first ride during the shutdown. taking advantage smartly of a lot of people who need to get to work. >> limiting surge pricing at 3.9 times. >> still high. still to come here on "worldwide exchange," valeant's wild ride. the story of the major hedge fund managers crushed by the stock's slide. >> but first, here's today's national weather forecast from
the weather channel's jen carfagno. >> sara and wilfred, good wednesday to you. what a storm system we had yesterday in the midwest. a system that created at least four tornadoes, damaging winds, and super cells that dropped hail in parts of iowa and illinois. that system on the move to the northeast coast today. when it gets here, it's much weakened, brings a couple rain showers to portions of the northeast, including new york and philly. behind it, now it is a wind storm. we've got winds expected over 55 miles per hour today in the midwest. not to mention the snow that's going to come down starting later today into tonight across portions of the upper midwest into northern minnesota. that's where it turns cooler. northern wisconsin as well. otherwise, maybe not quite as many record-breaking numbers as yesterday but a lot of above-average temperatures continue. a lot of 80s all across portions of the south. in fact, close to 90 in central and south florida. that's the latest coast-to-coast forecast. i'm meteorologist jen carfagno for the weather channel. cnbc's "worldwide exchange"
now to the corporate story everyone is talking about today. valeant's stock rout. meg terrell joins us on set with more on this crazy story. meg, it just gets worse and worse. >> it really has been unbelievable. the last six months for valeant are kind of a surreal experience for investors. it was already down 60% to 70% even going into yesterday's news. so they had postponed their fourth quarter earnings and had
withdrawn their guidance. the first public address from mike pearson after returning from his illness was supposed to be reassuring, but it turned out to be anything but. i'm seeing analyst notes saying all credibility has been removed from this company. they clearly don't understand their business. one analyst note came up saying the only evidence we have that this company is real is looking at these third-party numbers on their prescription drug trends. people are saying they need evidence the company is real at this point. so after that 50% stock drop yesterday, you have to wonder what's going to come next. i think you've talked this morning about some of the hedge funds in this stock. we know the big guys. i think reuters was reporting $700 million each yesterday for folks like ackman. these guys have really been defenders of this stock. >> why? why were they so confident? how did they get it so wrong? >> it's a great question. a lot of people loved mike pearson.
there was a lot of confidence in this guy. of course, if you look at his record up until the last six months, it was really, really amazing. he was considered this sort of guy who's bucking all trends in the pharmaceutical industry. so it's just completely turned around. now folks are saying what else could happen? nobody's comfortable saying we've hit a bottom here because they've got $30 billion in debt, and they haven't filed their 10k from 2015. if they don't file it in the next 30 to 60 days, they can start tripping on their debt. >> so what about the medium to long term? how plausibly could they dig themselves out of this hole? >> folks are saying the most important thing they can do is to pay down that debt. the problem they see there is that there isn't a lot of visibility into how much cash flow they're going to be getting because they're changing their business model. they're saying they're not going to be taking those big drug price increases anymore. if they can't do that, how much growth are they going to get from all these acquisitions they did. are they going to be generating enough cash to pay down their debt? they're not doing anymore
acquisitions. folks don't know where growth comes from. >> is there a read across other stocks in the sector, or is this valeant specific? >> if you looked yesterday across specialty pharma, these are companies that folks say have a similar business model. everybody wants to distance themselves. the way they are similar is they have a similar model in buying drugs, often increasing the prices. sort of the specialty pharmacy distribution system. so folks are worried that pbms like insurers are going to start pushing back and not reimbursing for those drugs. >> ibb yesterday had one of the biggest losses of the year. i think back to january. you've got the valeant news. you've also got the politics still at play here, right? >> yeah, politics worry people. all this rhetoric, hillary clinton actually putting up drug ads targeting specific companies. valeant was one she targeted. people worry about that.
they also don't know, if trump wins, they don't really understand what he would do to the drug industry. they say hillary clinton is probably safer despite all of her talk about wanting the drug industry to be her enemy. at least they understand her policies. so folks just are afraid of the unknown for the whole drug industry and especially valeant. >> meg, great stuff. thanks for joining us this morning. coming up, this morning's top stories. plus, could paul ryan end up being the gop nominee for president? our john harwood sits down with the house speaker and tells us why it might not be out of the question, next. and our twitter and facebook poll today. yes, we managed to get all the top stories into one. who had a worse day yesterday? bernie sanders, marco rubio, or bill ackman, who as meg terrell just reported, may have lost more than $700 million on his valeant investment yesterday. tweet us, facebook poll. we'll bring you results later in the show. n. this tv? margaret and tom lee.
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good morning. the fed in focus. janet yellen ready to make a policy announcement and then face a tough round of questioning on her view of the future. the race for the white house. a big night for hillary clinton and donald trump, but a victory by john kasich in ohio raising all sorts of questions about the possibility of a contested convention. and "indiana jones" returns. we'll tell you about disney's big bet on the franchise. it's wednesday, march 16th, 2016. you're watching "worldwide exchange" on cnbc.
good morning and welcome to "worldwide exchange" on cnbc. i'm sara eisen. >> and i'm wilfred frost. >> my favorite song. >> brought a smile to both of our faces. i must stop admitting my love of cheesy music. we're ready to tackle all things political with john harwood in just a minute. first, today's top market stories. >> the federal reserve wrapping up a two-day meeting. the central bank is seen holding rates steady. policymakers will also issue their new economic projections today. the announcement is due at 2:00 p.m. eastern time followed by a janet yellen news conference. she'll take questions from reporters a half hour later. ahead of all the fed events, we have plenty of other economic data to digest. the february consumer price index and housing starts out at 8:30 a.m. eastern time. 9:15 a.m., february industrial production. fedex reports third quarter results, which are always a good
economic read, after the closing bell. let's check in on global markets this morning. futures pointing to a slightly positive open. the first two days of trade this week have been the two lowest in terms of volume for the year as a whole. clearly markets treading water a little ahead of that fed decision. that fed announcement, we're looking at slight gains today. the dow up by 17 points in premarket trade. let's have a look at europe and asia as well. we're seeing some gains in europe. not too pronounced. again, slightly treading water ahead of the fed decision. germany, though, up by 0.6%. italy up by just over half a percent. asia, we saw a little more red, a bit more mixed performance. again, the main focus, what will janet yellen say? >> and commodities a little stronger with oil rising, giving a little boost to futures there. now back to politics. our john harwood joins us from washington with a wrap-up of last night's primary results. john, if you go through some of the newspaper websites this morning and see some of the
front pages, the headline seems to be a faster track for hillary to the nomination, a little bit slower for donald trump. what would your headline be this morning? >> i think that's exactly right, sara. by winning four of the five states last night, missouri is still outstanding, illinois, ohio, north carolina, florida, hillary clinton has calmed a lot of the panic among democrats that she wasn't going to be strong enough to put the bernie sanders challenge to rest. she's very powerfully on track for that nomination. now, on the republican side, donald trump took a step forward last night. he won the winner take all contest in florida. that was the biggest single contest last night. he knocked marco rubio out of the race. he also won north carolina. but by losing in ohio to john kasich, who grabbed a big chunk of winner take all delegates, running very even with ted cruz in missouri, and ted cruz picked up a lot of delegates last night, there's talk he may not be able to get the 1237
delegates needed for a first-ballot nomination. lots of talk among republican leaders b about the prospect of a brokered convention. i sat down yesterday with paul ryan, the house speaker, and asked what he would do if the convention was deadlocked and turned to him. >> when people talk about the prospect of a convention that isn't decisive, you are suspect number one for who could be -- >> take a sip of guinness. >> -- who could be drafted. have you category ruled out accepting that, if the convention asked you to do it? >> i think you should run for president if you want to be president. i'm not running for president. i made that decision consciously not to. i don't see that happening. i'm not thinking about it. i'm happy where i am. so, no, this is not -- >> don't intend to do it, you're not making a sherman statement about that though. >> i haven't given any thought to this stuff. people say, what about the contested convention? i say, well, there are a lot of people running for president. we'll see. who knows.
>> now, a couple points about that. first of all, i think it remains more likely than not that donald trump will end up with a majority of delegates and be the republican nominee. secondly, i heard from paul ryan's staff shortly ago who said, wait, he did say no. they also took actions a week ago to shut down a draft paul ryan movement. so viewers can take the measure of what he said, but i think this is still an unsettled picture at the moment. >> he also said he didn't want to be house speaker at first and didn't run for that either. >> that is true. >> saved his party that time around. john, quickly, can you talk a little bit more about the significance of the kasich win in ohio? ohio is not just any state. >> it's an important state. i think the principle significance is that it keeps a third player alive in the race and keeps john kasich, who has a distinctly different message from donald trump and ted cruz. john kasich, to the extent that
the so-called establishment players want a vessel in the race, john kasich is the closest thing to that right now, replacing past establishment vessels jeb bush, scott walker, marco rubio. so he has staying power in the race. what he hasn't proven is he can win anywhere outside his home state. simply the fact that you grab a chunk of delegates and hold it while ted cruz holds some delegates, while marco rubio holds some, that makes it harder for donald trump to get to that majority. the question becomes how badly do republican leaders want to try to stop trump at a convention? if he's not over the top but he's really close, are they going to go through tremendous exertion to try to keep him from getting it? some people think they will. we haven't seen it in my lifetime, so i'm a little skeptical. we'll have to watch and see. >> john, the night went badly enough for marco rubio to pull out altogether. how far away is bernie sanders from needing to do that? >> bernie sanders has a tremendous amount of money.
he's attracted a large following. he has run close to hillary clinton in many states that he's lost, although he was crushed in the state of florida last night. but i think bernie sanders sb z intends to stay in the race all the way through the conconventi even if he doesn't have a realistic shot. he's behind in the pledge delegate category. that's a tough deficit to make up. it's more of a lead than barack obama ever had over hillary clinton in 2008. she wasn't able to make that up. she has the super delegates beyond that. i think that's the significance of her across-the-board wins last night with missouri still outstanding. that is that she calms down those super delegates who might in theory had their been a collapse in confidence of her candidacy, some of these people would be able to switch and go to bernie sanders. i don't think that's going to
happen. >> well, it was making it a little more expensive and exhausting for her to fight these primary contests with him winning states like michigan. now she can just focus on the general election. >> well, but he's still going to be out fighting. he's going to be fighting in arizona and wisconsin and california and new jersey. so there's still some state where is he's going to be able to compete. and i think he will compete pretty vigorously, but there's a difference between competing as you're spreading your message and competing when people within your party think you're a mortal threat to the front runner. he does not appear to be a mortal threat to hillary clinton right now. >> john harwood, thank you very much for joining us this morning. sara, perhaps the key takeaway, he says more likely than not that donald trump gets the majority he's after. >> he did say that. we have not seen a contested convention since back in the 1970s. still, i'll be reading up on all the rules. it's very, very confusing.
we'll talk about it. maybe we'll even do a segment. i think the takeaway for you should be ohio is the most important state. >> you would have said that regardless of anything. >> it was suspenseful though. >> it was. very exciting night on the political front. still, of course, lots to cover over the weeks ahead on that story. let's get back to corporate news. stocks to watch today. the london stock exchange group and deutsche borse revealing plans for a $30 billion all-share merger. the ceo of cbs, moving on to the next story, says the company will explore strategic alternatives for its radio business. "the wall street journal" reports the fcc is likely to circulate a draft order approving charter communications to buy time warner cable. now to today's top trending stories. disney reviving the "indiana jones" franchise with a new movie starring harrison ford. steven spielberg will be back in the director's chair for the film, which will hit theaters in
july 2019. it's clearly been focused on "star wars" and reviving that franchise. it will be interesting to see if it can have the same sort of success for throwback 1980s filfil film. >> two things at play. disney nailed the "star wars" re-enactment. we had a re-enactment of "indiana jones" several years ago, and it flopped. >> it's because harrison ford hid in a fridge during a nuclear attack. >> either way, harrison ford's star is shining bright again. broadway's "wicked" passed a billion dollars at the box office. it's only one of three shows to do so, including "the lion king" and "phantom of the opera." >> started in 2003.
amazon is looking to use selfies and winks to verify online payments. the company filing a facial recogniti recognition patent this week that includes an extra layer of security called a living test. it has users blink or wink to confirm that they're not holding up a still photo. >> not very good at selfies. i don't take many. >> you are obsessed with selfies on snap chat. here we go. this is the new wave of payment. >> i think it's not going to work for payments. >> i like the blinking and winking. then you can't just do a still. makes sense. >> i need to be convinced on that one. next trending story and collective panic attack surrounding a crash on the tinder app. the dating app was down just five hours this weekend, but users were not pleased, taking to twitter in fear their matches had been lost. the site and matches have since
been restored. the talk out here of using these dating apps is far more prevalent. i've never joined either. i'm still not going to. >> i think if you joined tinder, you'd be have popular. >> i think sure ly i can meet people in traditional ways. >> we'll leave it there. coming up, today's must read stories, including why valeant has a much bigger problem than just fixing its balance sheet. it's part of our twitter question today. jim cramer tweeting out michael pearson and bill ackman. you're watching "worldwide exchange" on cnbc, first in business worldwide. cathy's gotten used to the smell of lingering garbage...
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and impact ♪ join us at earthhour.org 19th march at 8:30pm ♪ welcome back to "worldwide exchange." now to today's must read stories, catching our attention. i went to "the wall street journal" for the results of the primaries last night. kasich into the breach was the title by the ed board. here's a quote talking about donald trump, saying that no matter how many states he wins, he hasn't broken 50% in any state. and in ohio, nearly 30% of gop primary voters said they would not vote for mr. trump if he were the nominee. some 41% said they'd consider a third party if the race were between mr. trump and mrs. clinton. the bottom line of this op ed is
that kasich's win in ohio just prolongs the fight for the gop nomination, but the upshot, they say, is don't fear for republican readers and voters, don't fear a contested convention because, a, it could make donald trump come out more presidential so that the party can actually confidently rally around him, or produce someone who's better fit and can unite the party. >> kasich's win prolongs the fight, but rubio dropping out, i suppose, is a step forward or at least a step sideways, offsetting the other factor. the question is, who do rubio supporters end up going towards? >> the journal piece says likely kasich because that's the other establishment pick. >> fascinating night on that. the other big story we discussed a lot is valeant. that brings us to my must read. it's in "the financial times." it's titled "valeant: the end." it needs to decide and explain
what kind of company it will be when all that is done. anyone who thinks valeant can pursue anything like its old business model is dreaming. we've discussed the hedge funds that have suffered from this. the company suffered hugely in the short term. this particular piece says there's just as many questions to answer. >> meg terrell saying we have to watch early to mid-april because they have this deadline f for filing the annual report. they have to start paying back their debts. >> a lot of debt to pay back. >> absolutely. we're approaching the top of the hour. that means the team is getting ready for "squawk box." andrew joins us from new york with a look at what's coming up this morning. plenty to talk about between the political results, valeant, and of course it's fed day. >> you pretty much hit on the top three topics we're going to be discussing all morning. of course, the election is top of mind. we're going to talk about the brokered convention idea with two gop stalwarts who want to
have a brokered convention, say they're ready to have a real scrap on the floor. we're going to talk about what that means, how it would work. we'll also talk about paul ryan saying that, you know, he still may be willing to do this or is not saying he won't. talked to john harwood yesterday. a number of big experts on today's show. harold ford is going to join us. daryl watkins. then we'll hit on valeant, as you just discussed. what it means for bill ackman. by the way, the trickledown effect everywhere else, aig a major shareholder in ackman's fund. blackstone. it's not just people in valeant. it's the trickledown from ackman and what happens there. then of course the big one, and we'll hear later today what happens, but we'll be talking about what the fed is or is not going to be doing. that's what we got. >> andrew, great stuff. we look forward to that. "squawk box" coming up in 11 minutes' time. sara, if there was a brokered convention between the two wex anchors, who do you think would come out on top? >> i think it would take two or
three ballot rounds, but there would be a clear front runner, as there usually is, on "worldwide exchange." >> who would you pick as your running mate? >> maybe that's our twitter question tomorrow. >> exactly. plenty of time to discuss -- >> you can be my vp. >> maybe. then maybe we'll push you off the edge and i'll be president. i like that. still to come, the fed is widely expected to stay on hold at today's meeting, but for how long will the central bank be pushing the pause button? drew matus will joins coming up next. you're watching cnbc, first in business worldwide. 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 it's 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.
welcome back to "worldwide exchange." the markets waiting for the fed's policy statement and economic projections later today as well as chair janet yellen's news conference. joining us now with more on what to expect is drew matus, managing director and deputy chief u.s. economist. thanks for joining us. we have had better data.
we've had less global turmoil as well in the last month or so. but still, a hike today is off the cards, is it? >> it seems to be. it shouldn't be because, as you said, inflation is actually running where they said it would. unemployment is coming down and would probably hit their range by the end of the year. they're only a tenth of a percentage point off. and under those scenarios, they said by year end they'd hike four times. yet, it doesn't seem like they're going to go today. and there's really no rhyme or reason to it except for the fact they're nervous. the markets seem nervous about it. the markets are unsure this is the right thing for the fed to do. >> how do you expect her and the statement to communicate that nervousness today? >> well, they don't go. they probably take june off the table, and they talk about kind of how conditions will evolve toward year end and get us all set up for the resumption of rate hikes in the second half of the year. the dots will come down --
>> their projections of how many times they will raise rates? >> yes. and where they put the terminal rate, where they expect to end might come down a little bit too. that'll also signal that they're just not in that much of a hurry. >> when we think about the sentiment towards janet yellen and the fed, the bouts of turmoil after they hiked in december, has she regained credibility? the data is better, and there's so much negativity around what the ecb and bank of japan have done by taking easing to negative levels. >> yeah, i think that's right. i also don't think the fed ever blamed themselves for what happened in january. i think the fed said, we hiked rates and two weeks later all this stuff happened. the timing doesn't match up all that well. my own view on janet yellen is -- and other central banks -- is one way for the fed to take pressure off the other central banks would be to continue the
rate hike cycle. that might be the easiest thing. everyone is trying to affect their rate differentials between the central banks by lowering rates, and they're all going into negative territory because the fed is so low. if the fed goes up, they don't have to ease as much. >> do you think the economic data or the fed speak is going to become more important for the markets going forward? >> my own view would be the fed speak because economic data has been fine. yet, the fed is suggesting they're not going to go today. so you might as well just pay attention to the people pulling the trigger as opposed to the bullets and the gun. >> does the market want them to go or to wait? >> well, the market never knows what it wants. it's a fickle beast. my own view on it is that if the fed were to go today and surprise everyone, that the initial response would be negative but that people would calm down and think to themselves, they're really telling us things are okay. whereas, you know, not going or very dovish statement, in my opinion, would be viewed negatively.
>> but things are not okay. >> things are okay. >> unemployment is down and inflation is ticking higher, but consumer spending, retail sales, corporate earnings in a recession, manufacturing is still, by many accounts, in a recession. >> manufacturing is starting to improve. the rest of the world has to take care of themselves. the u.s. looks fine. >> drew, we're going to have to leave it there. very quickly, the next hike comes when? >> september. >> great stuff. drew matus from ubs joining us this morning. >> less than a minute left. highlight a few things to watch. i'll be watching the banks going into this fed meeting. they were the source of anxiety at the early part of the year. part of the big selloff was attributed to the fact that the fed wouldn't raise rates, which actually helps their bottom line. so any messaging from the fed could see a response in financials. >> i'm following similar suit. i'm watching the fed. not so much the decision at 2:00 but the press conference at 2:30. very quickly, the response to our twitter question. we asked you who had the worst day yesterday. sanders, rubio, ackman. rubio's come out with the win in
good morning. trump and clinton racking up victories, kasich taking his home state of ohio, and another one bites the dust. marco rubio dropping out of the presidential race after donald trump's big win in florida. a full rundown of the primary results straight ahead. also, decision day for the fed. no policy change expected, but that doesn't mean there won't be plenty of market drama. the big question, what will janet yellen say about the future? and finally, no time for love, doctor jones. harrison ford signing up to reprise his role as indiana jones. it is wednesday, march 16th, 2016. "squawk box" begins right now.
good morning, everybody. welcome to "squawk box" here on cnbc. i'm becky quick along with andrew ross sorkin and brian sullivan. we're counting down to today's fed decision less than eight hours from now. that's going to be followed by a news conference from janet yellen. check out the u.s. equity futures. yesterday was a mixed day for the markets. the dow actually managed to eke out a gain. that's eight of ten sessions the dow has closed higher. this morning you see slight green arrows. we should point out the volume yesterday was the second lowest day of the year, followed only by the day before that. people are waiting to see what the fed has to say before they place their bets. overnight in asia, you'll see japan closed down by about