tv Countdown to the Closing Bell With Liz Claman FOX Business January 7, 2016 3:00pm-4:01pm EST
. trish: we are less than an hour to the closing bell and the dow jones industrial average is on track for its worst start to a new year since 1991, hittinged session lows last hour, down 411 points. at this moment from the big board, we are down, you can see 372 points with the s&p 500 off 44 and the nasdaq down 128. briefly dipping into correction territory, down at least 10% from its recent highs. the chinese economy and middle east are driving u.s. markets lower and have been right from the start of trading. so we fell more than 300 points at the open. it is all in reaction, everyone, to china. china halted trading after
falling 7% after only 29 minutes in. that sent the european markets tumbling and u.s. markets tumbling as well. oil is weighing on the markets, u.s. crude trading at $32.10. lowest in 12 years as iran accuses saudi arabia of bombing embassy in yemen. we'll ask the former ambassador in saudi arabia how the tension is playing in the sell-off. ambassador robert jordan is joining us. i'm trish regan in for liz claman. it's going to be a wild ride. we have 60 minutes to go. let's start the "countdown." >> okay, what a sell-off we are in. of course, off session lows. but, nonetheless, as we move into the final hour of trading, you can see accelerating losses right there, down 376 points. we are dangerously close to correction territory everyone for all of the indices here. here are the levels you need to
be watching for, 16,187 for the dow. and 4,697 for the nasdaq. you got oil settling out the day at $33.27. that's the lowest point it has been at since 2004. oil trading after hours also seeing additional downside, down 2.3%. chevron, exxon, conocophillips, marathon oil all down as a result of oil. on the flipside, gold bugs have a celebration today. gold having fourth straight session of gains and gold corp., barec gold all trading up as gold looks at $1109 an ounce. to the floor of the new york stock exchange, cheryl casone in the center of the action. what are sellers telling you? busy day. >> selling begets selling, this is a crucial matter. doesn't matter where we open,
matters where we close at 1:00 p.m. eastern time, midday, lot of things are looking good but the traders are seeing an escalation in selling, selling begetting selling. you talked about the issue potentially of a recession. that is the fear. it's about the u.s. economy, yes. what happened in china overnight kicked off the market to the downside this morning and a lot of concern with traders here about what china will do. they're going to take out circuit breakers for their market when they open tonight. so tomorrow could be another rough day and a little fear that's happening right now. tonight give you some of the big american names we are watching right now that are under a lot of pressure. big financial companies are in the dow laggards, they have been most of the session, bank of america selling off strong right now. general electric. boeing, jpmorgan, caterpillar, huge exposure to china and dupont and headlines crossing
with regards to dupont right there. here are the big names on the s&p, they're watching again as we move into the final trade on just the fourth day of trading of 2016. hard to believe. freeport mcmoran, big exposure to china. wynn resorts had a lot of problems in macaw and i want to give you, trish, one positive note. i'm an optimist. glass half full, walmart, that's the stock to watch, and that stock was crushed last year, 28% to the downside. now walmart seems to be the bright spot in otherwise what is a dismal kickoff to trading in 2016. back to you. trish: interesting stuff. thank you so much, cheryl. of course, the big concern is that the u.s. could fall into recession. that big "r" word is being dragged out yet again. the economy barely been growing, we are adding jobs but the jobs aren't paying a lot of money.
the question is what does the international turmoil mean for our u.s. economy? can you see obviously having a big effect today. we saw it have a big effect on the first trading day of the year as well. take a look at volatility right now. vix. this is what you call the measurement of fear. when you look at vix you figure out how spooked people are, and take a look at that. 25, above 25 on the vix. we haven't been at those levels in a while. so you get fear spiking up, and that's contributing, of course, as well to the sell-off that we're watching. let's go to traders. doreen joining us from the nyse, from the cme dan and from the nymex, jeff grossman. doreen, starting with you. >> okay! >> it's been a while. but is this the start of something more, in your opinion, or is this a blip on the radar? >> i don't think it's a blip. i think clearly sentiment has shifted and people are very, very worried, not only about china but the u.s. economy as
well. i think this is a very ugly close, i have to tell you, and as cheryl said, it is how we close that we worry about tomorrow morning, the fact they've lifted or heard they have lifted their bans, we won't be able to stop trading anymore, that's something we're going to be concerned about and watching the markets very, very closely. trish: you know, the optimist in me wants to believe by lifting the bans, you allow a market to function, and as soon as you have all the selling, you have buyers that jump in. but the flipside, of course, is the chinese markets and this is kind of untested for them. they've always had some mechanism in place to save anyone. doreen, what's your gut reaction? what do you think is going to happen when we go to bed? >> obviously, if i could predict, that i would be a wealthy money. a lot of people have come into
the market, a lot of traders come into the year underweighted in u.s. equities. any time you get a real drip down, you see people looking to buy value and get a little rally. i think clearly the sentiment has changed to the downside. trish: you know, i want to go to jeff at the nymex. stay with me, doreen. gold was a bright spot. we haven't seen gold moving higher in the face of all this fear as often as you would think. what was interesting to you about today for gold? >> the fact it was up amidst all the turmoil. usually everything is dragged down here. usually some of the indicators that take gold's up weren't there. it's a contrarian thing and maybe the only place people feel the safe haven for when this turns around and say maybe there will be inflation blip here, but the truth is, i've been focusing mainly on the oil today. it's really an abysmal situation here. trish: abysmal. >> abysmal is correct.
let's face it, it wasn't bad enough we have all the china news and the equities are down. yesterday we had an inventory report that was as bearish as one i've ever seen, and i've been doing this a long time. i was very surprised that the market behaved as well as it did. that shows you how weak we are here. down to $32. everything is really on its back here. trish: and i want to jump in and say it is bizarre. given what's going on right now in the middle east. given the disputes between saudi arabia and iran, logically, then you would say oil is going to actually seal. that we're going to see an increase in oil prices because there's an uncertainty in the middle east, but instead people are like there's tons of supply, the economy is in bad shape, we don't believe there's enough demand, dan? >> you know, i agree with -- normally that would be what you think and what the oil market
is telling me right now, that's the in the case. they're fearful about something else, and it's oversupply. not a demand issue right now because by all rights what's happening in the middle east should be shooting this through the roof. we had the supply growth, that should be shooting through the roof. worrying about fear and uncertainty, things are going to happen down the line. they're dragging the stock market with it because you have the correlation and using 2009 as an example. 2009 is a terrible example. we're going off the rails not what's going on right now. you mentioned earlier -- sorry to go on -- you mentioned fundamentals. fundamentals haven't been great but good. nowhere near a recession in the market right now. but the market's worried about what's going on in china and need to get it out of system. trish: you've got smart people like investor george soros doreen saying that this is a crisis. he believes this is a crisis that could be akin to 2008. do you agree with that? >> i don't know about that.
it is different as the previous guest said. fundamentals are solid but my belief they think this market has gotten ahead of the fundamentals. regardless of china or anything else, there was a lot of people that have the sentiment that this market was going to roll over anyway, with or without the china interjection into the marketplace. this news. but i think there are the other people, too. bob dole said he doesn't think this is a panic situation. he thinks -- trish: he thinks it's going to be okay. by the way, jeremy siegel, professor siegel from wharton was on the show. he's always a bear, but he feels that we are going to see strong earnings growth in the range of 8% this year, and the dollar will sort of stay where it is, and the fed is not going to do a darn thing because they can't. let's not forget that one of the reasons we've seen all the upside we have over the last couple of years is in part because of the fed and the extremely accommodative fed,
they keep printing money or leaving rates so low that it's so easy to borrow. dan, do you think that the fed is going to be able to move this year as it anticipates or would like to do? >> well, if it were to continue to trade like it is today, obviously not. when you look at late last year, the first rate hike was anticipated and the markets got spooked, the fed backed off. ultimately they raised rates because things got better. let's see what happens in china before we make decisions what the fed does. stanley fischer was on yesterday saying he expects four rate hikes this year and he saw what went on in china. i don't know if he's right or not. the fact is if things turn around fundamentally, the fed will do what it needs to do unless a global economy goes completely kaput, i don't see that happening. trish: let's hope not. doreen, good to have you here. dan, jeff, thank you so much. moments from the closing bell
happening in just about 44 minutes. take a look at the market, off 360 points, steep losses there and they could be accelerating into the final moments. a loss of more than 2% across the board. the dow transports down almost 3%. twitter shares are hith a new all-time high -- low, low! of 21 bucks a share, not even for twitter. maybe investors aren't excited about the possibility of expanded 10,000 tweet character limit? sounds like a lot of e-mail. take a look there. twitter hurt down more than 4%. move to oil which has seen a lot of downside in after-hours markets closing the day out low. $33 there is the after-hours trade. crude tumbling to a level we have not seen in 12 years, folks. oil prices are falling every day in 2016. here with expert analysis
steven schwartz which provides daily insight on the energy markets. i need to talk to you now. look at this. >> ugly. trish: despite all the trouble in the world between saudi arabia and iran, and yet we've got oil that continues to fall, why? >> absolutely, and part of it is exactly what you point to about saudi arabia and iran. saudi arabia and iran are in a cold war, not fighting one another on the battlefield, they're fighting at the gas pump. with the united states given imprimatur on nuclear issue, in sense the saudis are squeezed. these two countries are going to fight one another at the price pump. so therefore, where is the price growth now globally? it's in asia. and, of course, now the curtain has been pulled back on china. not exactly the communist, economic powerhouse we all thought it was. japan in fifth recession since 2008. saudi arabia and iran are
fighting for market share in a market that is clearly contracted. hence why you have the pullback and the extant pullback in oil prices. >> one of the constant questions is why are we not seeing this show up in the economy in spending? people are holding on. they're saving at the gas pumps. i get the argument people say we want to believe it, see it so we can believe it. they should believe it by now. we've had lower prices at least a year. why isn't it translating into spending? >> well, i've been saying it for the past year that cheap energy, and for that matter cheap copper, cheap aluminum, cheap lumber, cheap iron or, cheap industrial products are not a panacea for economic doldrums. they are a symptom of economic doldrums. commodity markets cannot drive economic growth. the only thing that drives commodities is economic growth. we're seeing contraction not just in the oil markets but
industrial metals is the canary in the coal mine. the oil prices are low because demand is low relatively speaking. trish: this actually is a net negative for our economy. when you see oil prices tanking as much as these have tanked. troubles for the oil companies and the oil companies employ a lot of americans, especially in places like texas and oklahoma? >> it actually is, a net negative because it's a canary for something is wrong with the economy. we're looking at key indicators. chicago purchasing managers, durable goods, the coincidence lagging indicators are pointing to economic contraction. now with regard to the oil companies, let's keep in mind there are three different types of oil sectors inside one company. the crude oil producer which is ugly now and only uglier over six months. the mid stream guy who moves the barrels to and fro, and
then the refiner, the refiner, i can buy $35 oil and sell $55 barrel gasoline. the refiners are doing quite well. trish: let me ask you this, would you buy oil right now? we're near a bottom at all? >> no, no, no, i'm a seller. i've been bearish for a year and a half. it's worked. trish: where is it going? >> right now today we took up $32.40. key technical support was the low put in during the great recession. if you recall in july 2008 almost did 150 bucks a barrel. in december of 2008 hit $32.40. trish: what do you think? 20? 25? >> absolutely. trish: okay. >> mid to low 20s at this point. trish: your advice is don't buy it here. may want to short it. good to have you here. >> thank you. trish: the feud between saudi arabia and iran intensifying today. iran accusing saudi arabia of intentionally striking embassy in yemen. joining me former u.s.
ambassador to saudi arabia robert jordan. we took that position right after the september 11th attacks. good to have you here. >> thank you. trish: do the saudis feel like we're not there for them right now? >> absolutely. they feel completely abandoned by the united states. going back to the fall of hosni mubarak in egypt. this administration's embrace of the muslim brotherhood. the ignores of the so-called red line in syria. the iran nuclear deal. the iran missile test last week. all of this suggests to the saudis that we really don't look at the world the same way. they say if we do this to hosni mubarak, they may do this to the saudis as well. i think our relations with the saudis hit a low point. trish: ambassador, what is your prediction for the rest of this year? at some point the administration is going to change, and the saudis will be dealing with someone different. but so long as president obama
is in charge, is the house assad effectively at risk? do you foresee them being able to maintain their power this year? >> i think it will maintain power. every time demise is predicted they rallied and been able to survive. they have survival in their nature. i think they're making calculations right now, then they turn out to be mistakes. war in yemen is a quagmire for them. no political objective articulated. but viewing this as proxy war with iran, and so they're going to soldier on with it. i think they have a tremendous degree of concern about the iran nuclear deal. they see themselves surrounded by shiite militias and shiite threats throughout the muslim world. trish: and to your point, ambassador, they feel abandoned by us. i want to get to oil. we've been watching it fall to a 12-year low.
there's a lot of supply out there, and the fear is not enough demand. how is this affected right now by all the challenges in the middle east? the price of oil changed. >> the saudis are pumping flat-out right now to maintain market share. they're giving heavy, heavy discounts to northern europe. they're only raising prices very slightly in asia because of the refinery profit margin there. overall they're producing flat-out. when iran's sanctions are lifted, they'll be producing as much as they can ramp up. they're going to have $100 billion to retool the oil industry. we have libya coming online with more oil, and even iraq. so it's a glut of supply, and the saudis are trying to marginalize certainly the iranians and to some degree the russians and even u.s.
high-cross shield producers. this is a race to the bottom. trish: they are trying to marginalize u.s. shale producers. i think back to 2014 in the critical opec meeting, and the saudis, who are very instrumental in opec, left prices steady, and in doing so, effectively started to drive those oil prices lower, which hurt shale producers, still hurting shale producers. did they they in some ways sort of create this mess by doing what they did back in 14? >> in a way they did. but also the u.s. production created some of the mess as well. over the last five years, we've added something like 9 million barrels a day to overall production. and 5 million of that comes from the united states. so we ourselves are actually increasing heavy production more than the saudis have, and i think in some ways the saudis have miscalculated about our shale producers.
they have driven out the high-cost producers, but the rest of the industry through american ingenuity and technology lowered costs and be very competitive. i think the saudis miscalculated how much impact they could have. trish: ambassador, i want to jump in and show our viewers. we are down more than 400 points, near session lows, at 16,500 on the dow. a loss of 2.4%. energy is part of this. the chinese situation definitely weighing in on the trepidation on u.s. markets. ambassador, good to see you. >> thank you. trish: 40 minutes away from the close. the market off about 400 points, a loss of 2.3%. one little bright spot in today's sea of red was walmart. the worst performing dow stock of 2015, tumbling almost 10%. new year, new day and walmart is the only dow industrial
stock up today, up 1.7%. the best performer in the index so far. shares $64.62 as we get ready to close out the day here with a sea of red, down 400 points on the dow. it has been a brutal start to 2016. this week's been tough, but can you bet investors are going to be watching closely. tomorrow's jobs report, that's the thing we'll want to know. are we adding enough jobs? increasing wages? news today that number of americans that applied for benefits in 2015 actually fell to lowest level in 42 years. joining me with a look ahead what you can expect tomorrow morning when the report comes out economist dan north and liz macdonald. how many jobs are we adding to the economy? >> around 2000 with the unemployment rate around 5%. what's interesting is that maybe if the last month's report was the one most closely
watched in terms what the fed action would be, this report has the potential to be the one that is most hated ever because think about it, if tomorrow comes in as expectations, it's going to be a strong report. if it's strong or stronger than expectations, the market is going to hate that because it's going to look at that and say my gosh, the fed has to raise more than we want to. trish: here we are back in alice in wonderland, upside down world, we want the fed to be there for us. jeremy siegel thinks 2016 is going to be a good year because the fed is not going to be able to move and contribute to the party that we've seen before. liz, how do you think investors are going to interpret tomorrow's stock market? >> you are right trish, looks like we fell through the looking glass in terms of what the federal reserve does. 200,000 jobs, it was 210,000 per month last year and that still is down from 2014 average
of 260,000 jobs. is this strong enough of a report for the fed to say we will raise rates? that seems to be the outlook. the answer is yes, going to be a goldilocks report, not too hot, not too cold but wage growth too is slightly ticking up, the fed is saying to itself, jobs and wages seem to be good, yeah, we can raise rates. >> do you think this is the trepidation we've seen? dan, the market is off 414. we are at session lows, 16,494, and we just have about 36 minutes to go on the clock as people make the final trades. is this in part, dan, because people feel like they need to get out right now. that the "r" word, recession is on the radar? to what do you attribute the downside? >> well, everything that's gone wrong all at once. you couldn't ask for a worse
combination of things going on. you have the global tension between iran and saudi arabia, iran launching a missile within a mile of one of our ships. you've got north korea testing an h-bomb. the federal reserve raising rates. china slowing down, china pmi looking worse. china stock market, everything is coming at the worst possible time all together at the same time. trish: it's lousy. >> it's a new year, too. just the start of the new year, so people are -- it was a really ugly start monday morning from the very beginning and people are kind of reeling, it's a hangover from the end of last year. i make one further point so that if the jobs report comes in really strong, it's a disaster. if it comes in really weak it's a disaster, too. because people are saying my gosh, there goes global growth. trish: in the meantime, we got to worry about china, too. i want to go to cheryl casone
as we look at session lows, 16,486 is the level and keeps falling, cheryl? >> we've got a good half hour worth of trading, could a circuit breaker kick in? not at session lows at this point. something that's on traders' minds right now. i was talking to one of the traders, what do you make of this? this is the worst kickoff since 1991. they believe a lot of folks down here that the fed quit too soon, they hiked interest rates too soon and the economy wasn't ready. if you want reality, it's a sell-off on the dow, the s&p and the nasdaq. we talked about the jobs report, that's key because the unemployment rate, we're expecting estimates 5%. but the quality of the jobs,
that is a problem. i can get you a job flipping burgers or construction, quality middle class jobs are missing in the u.s. economy and that is one of the biggest problems this economy has, and, of course, there is concerns as we get towards the close about china, because again, they're not going to put the circuit breakers into effect tonight. what does that mean? looks like the reality of the chinese market versus the reality what you're seeing on the u.s. market, trish. trish: cheryl, you've been watching the vix, above 25 on the fix, the fear of gauge that people watch. fears creeping back in that suggest something more than just the economy is not in very good shape. have you george soros saying today that he's very concerned about a crisis, and he's saying this this could echo 2008. that's the kind of talk that starts to get people worried and sending the market down 400 and some odd points.
>> you hit it, manufacturing, look at the estimates tomorrow morning. we'll have it on "mornings with maria," and i'm telling you 1,000 lost at least as manufacturing goes, and guys saying it could be worse. that's the weak sector. names we're following, the dow laggards saying dupont and general electric, manufacturing activities in this country that is not performing. not up to par. that is one of the biggest issues. i think the fed discussion unfortunately is going to come back over and over again. what does the fed do, trish? what are they going to say about it? we'll have to find out during the next meeting. >> do they hold off, trish on raising rate. trish: they probably have to. they have gotten themselves in such a situation. don't go anywhere. i want to bring dan and liz back into the conversation. they have got themselves in situation where they had opportunity to raise rates.
they didn't take it. we're now in global recession with china, being where it is. europe being where it is. and they're trying to raise when the u.s. economy is barely chugging along? i mean it seems that we may be in some, some kind of a situation which they may not be able to get us out of. that i think dan is part of the fear, with a market off 430. >> right. let me step back for a second and catch our breath. the stock market is not the same as the economy. we do not expect to see recession this year. we expect to see growth between two and 2 1/2%. the stock market moves on any number of things, mostly fear right now. it is not fundamentally necessarily linked every time to the economy. that said -- trish: whoa. this is the past problem, right, liz? >> go ahead. trish: we should be linked, the
stock market should run six to nine months ahead of what the economy is doing. i think to dan's point we have had a divorce basically from fundamentals of the economy with the overall market. and that, liz is what has people like carl icahn up at night concerned. >> you're absolutely right. >> they don't think there is anything really supporting levels we've seen. >> economists are often rear view mirror thinkers. they look at last month's data the way it is going forward. you're absolutely right. when you see ism manufacturing number trending down towards 45. majority of the time means manufacturing or overall economy could be tipping towards recession. two consecutive negative quarters of profit growth for companies in the united states, that is usually indication of recession. the "r" word is now being used more down on wall street. we're talking manufacturing jobs. possibly could see 2,000 manufacturing jobs lost in december. so when we're looking at the
companies though, also exposed to china, watch this. in terms of your argument of the stock market and economy, they tend to be separate. take into account, apple gets nearly 1/5 of their sales from china. yum! brands, nearly half of its sales from china. nike, blue chip companies in the united states are heavily exposed to china and double digits. trish: i'm interested in an important point. i've been talking about this a lot. basically the chinese economy, yeah, it's a big deal. second largest economy in the world yet same time, liz and dan, it doesn't actually account for tremendous amount of exports right now. we're $18 trillion economy. we export $150 billion to china. how is it downside in china, dan, causes everybody to get so worried back here at home or is there something else going on? >> you're absolutely right the real economy exposure to china
is very small. our exports are about 13 1/2% of gdp and exports to china are something like .7% of gdp almost a rounding error. the real economy connection is pretty small. what is the big connection is the financial market contagion what you're seeing today. china falls for any number of reasons, our stock market gets worried and falls as well. that slows consumer confidence and that is the mechanism which it comes about. trish: we're back on the floor of nyse. we look at market still off pretty significantly. 421. there seems to be a big concern there on the floor. tell us about it. >> want to bring in keith bliss from cuttone & company. keith is a great voice. market and economy truly together or is there separation? are we seeing market selling off today on fear or is this really underlying fact that the economy
is weak in the united states? >> well, i think economy is taking a back seat right now. most traders and brokers and client i talk to are not thrilled with the u.s. economy. we have a problem. what we're seeing capitulation trade. we've gotten so stretched technically inside of this market. vix is trading at overbought scenario and all major indexes are oversold, vastly oversold now. this is turning into a real fear trade. if we don't get some sort of bid underneath it soon and could see selloff and august lows on s&p which is 1867. >> we're close to that vix is near 25. fear gauge is really high. let me ask you about china. we're a few hours from chinese market opening. there seems to be underlying fear without the circuit breakers in place, i hate to say it but bloodbath in china. >> i think risk of that is certainly there. the problem you have with china. what really set this thing off. the fact they have been deevaluating currency.
when you devaluate currency they take it out of the country and get it to places where they get more value for their money. >> we saw gold do that. >> the problem with china, a lot of capital is locked up inside of equity market, they put in controls last summer not allowing people to liquidate positions. as soon as they unlock it, it many about as self-fulfilling prophecy and goes down. >> stocks that sold off in huge way, jpmorgan, ge. dupont, caterpillar, big exposure to china. are you contrarian right now? do you start to look at this last few moments of trading, look to myself, wait a minute i pick up some deals? apple is selling off. >> when you take a look at valuations on some of these things, this is problem that happens inside of stock market why you get capitulation trade because retail investor component is selling everything because they're scared. buy when the day is darkest and sell when the sky is blue. >> is this the retail investor?
i see this right now as institutional money. i think big change is happening institutional side. i think retail investors jumped out of fear. those 50 and over, had it after last year. >> mutual fund complex are real day investor endneath. mutual fund gets redemptions they have to give them the money right away. not day trading stocks but people inside of 401(k)s and 529 bs and shareholders getting nervous and panicked. they're calling mutual fund complexes and panicked and redeeming those shares. >> endowments, universities, large trades, calpers, things like that. >> sure you always have to remember that institutional investors are retail investors at the fundamental level. >> retail investors. you and i disagree a little bit. keith, thank you very much. cuttone & company. >> my pleasure. >> we're love the lows.
down 3988 on the -- 388. on the dow. we'll keep you posted on the numbers. trish: cheryl do not go anywhere we'll continue to go back to you. stay with us, cheryl casone. thank you, keith bliss. want to point out u.s. stocks fallen 4% in 2016. what a way to start the year. more than 40% of the stocks in s&p 500 are 20% or more off their highs. some call that definition of a bear market. david bronson, joins me with more. david, are we approaching bear territory? >> well i don't know that the s&p is going to go anywhere near bear territory overall but certainly finks alley it feels like it for a lot of investors more index or remember ended
trish: traders condemn plate whether we'll be in bear territory, what begets selling? once the momentum takes off it is hard to stop. >> the problem, trish, towards the close as you very well know from all investment advisors you talk to every day. you get to a point where it is like, do i make a bet that i can ride this market to be contrarian. what you're seeing in the last half hour right now is those that are saying, i can't, i'm out. capitulation. i will give up at least for the day. i have to go back to the story for china. there is such an unknown factor. we had many people question the value of chinese data, numbers on the economy, market numbers from country like china, the government, what the government is doing. think of all missing finance executives they can't find right now. what is the government doing there? all questions adding to that as we move into the close. there is big movement going on
within the big institutions, whether mutual funds, endowments. whether calpers, they're making big block trades. that increases volatility and that again is kind of pushing, we've got larger groups making gigantic trades, smaller funds, smaller advisors, even down to the retail level on small scale, they're making trades in tandem. they're falling. if everybody jumps off the cliff do i want to follow them today? if i see everybody going, maybe that's it. maybe i to off the cliff with them. that's today. tomorrow another story, trish. trish: but here's the problem, liz macdonald, we have china happening overnight. now they're no longer going to have mechanisms in place to stop the selling once it starts it could really be quite a night and thus quite a morning for u.s. markets. this is what investors are contemplating in the here and now as they get ready to close out the day and not be able to trade until tomorrow morning. >> you're right. trish you covered in 2007 a
rotten january when china fell 9%. markets dropped over 440 points in the dow. then it happened again in january of last year. we're at it again. january, you know, sometimes, you know the way the data shows 75% of the time, january is down markets may be down for rest of the year but a good 25%, a third of the time you see lows of the year in january, then it as over. trish: let's hope. >> there are some positives there. sectors still in the green, telecom, consumer discretionary and health care. consumer disconsideration nary includes amazon. back to you. >> dan, we hope this is sort of a tough week, a tough start to the year that things will change. jeremy siegel on program, he thinks 2016 will be great. it is jeremy siegel, professor siegel, well-known bull very rarely making bearish case.
what are you telling clients today. >> tell me my professor at wharton was jeremy siegel so i will go along with him. we're really -- i hope so. we're a risk shop. we advise clients what we see the risks are. not so much investments where business risks are. in other words who will be paying them slowly? will they get money back from their customers? and we're start to see degradation there from our own internal data and you're starting to see bankruptcies on the rise. from that perspective you are seeing more risk arising in the economy. it isn't as nearly as dramatic or breathless as it feels like today. that's true. trish: you know -- >> we're advising against, we're advising that risk is coming back on. we're certainly not having panic markets are seeing today.
trish: one of the reasons it feels breathless and has momentum, there is strong volume. numbers of shares trading hands today, very high, running 33% above average. cheryl, that is something that once it starts, once everybody piles on, that means it starts to become even bigger and bigger. >> exactly. i'm looking at volume right now in particular. we're at 777 million. that is a little bit, not quite as high as it could be. surprised that it is not even higher. talking about things that are positive. we had to mention walmart for just a moment here. this was a stock so crushed in 2015, it's a winner this year, retail names. nobody talked about why was walmart today. same-store sales coming in for jcpenney, one much their biggest competitors. there is the question, all money americans are saving on gasoline, did they spend it in the month of december? remember we're seeing all retail numbers from all the companies
falling. news was bad on macy's today. that is different story, mall real estate story. main retailers, their numbers, if those are good, at that could be something that could bring a positive breath of fresh air to this market and not kind of let "bad news bears" take over as they are now. trish: i made to be debbie downer here, part of reality of walmart, when you're in a tough economy you shop at walmart, right? sometimes the counterintuitive trade, all right, macy's will have tough time but something like walmart might actually do better. think about china and struggles they're having, one might also assume that the prices for chinese goods will go down as u.s. comparatively looks stronger and currency is stronger. maybe that explains what is going on behind the walmart trade. do not go everywhere, cheryl. we're about to point out to everyone, 18 minutes away from close of trade. jeff flock at cme, with details why we see crude prices get
hammered. see it in after-hours market. today's market, crude dipping down to 12-year low. this is despite the fact we have a real mess in the middle east. jeff? >> it did come back, that is the headline today, trish, it did come back. 32.10, 12-year low. we're pretty much where the close was at 33.27. i trained my cameras this hour on s&p options pit, open outcry pits famously gone away at cme. the options pit very active as you can see. gold has done what you would expect to it do on day like today. that is go up. gold gained $30 over last five session, trish. up about 1 1/2%. up $17. gold has done well. i think the headline today is, despite what happened, oil came
back better than anybody thought it was. it closed down around 32.10. tell you, bottom, the sewer is the limit. trish: looking at the bright side. sewer is the limit. thank you so much. on set with me, charlie gasparino. cheryl casone joining me from the new york stock exchange. charlie gasparino. john carney from the "wall street journal." we're seeing financial stocks get hit pretty hard. bank stocks as selloff continues. you know, guys, one of the things that george soros, billionaire investor george soros today, said he is very fearful of a crisis a la, 2008. who knows. carl icahn worried about -- >> these guys play their positioning. unless we were lied lied to,
banks are not loaded up with chinese debt, chinese stocks. think what would cause banks to implode as they were during the mortgage crisis? would have to hold junk bonds on inventories. trish: let me walk you through that. >> because of the volcker rule they can't. banks are capitalized since 2008. don't go there. trish: maybe not china but hold other emerging market. >> so? they can't. trish: hear my theory, charlie, please hear my theory. the thinking is if china is in a very bad spot, they're not going to buy as much way of commodity. >> they don't have the volcker rule. trish: that will hurt all the latin america countries. then hurt anybody who is holding that stock. >> that will not create a 2008 situation. might create a bear market, massive correction and all that stuff and recession. that will not create 2008. let's not even go there. >> it will hurt big banks in big international operations. citigroup is all over the world. >> right. >> but they're not going to have
crisis. they are much better capitalized than they were in 2008. while we maybe be headed for some sort of crisis not a crisis anything like a banking -- trish: when you say we might be heading towards some type of crisis, what is the worst-case scenario? >> correction. think about it this way. we've enjoyed since president obama got in office the dow going from six to close, it hit 18 at some point, right? there is a good chance that the economy from -- it was fueled largely by cheap money. interest rates being very low and massive money printing known as qe. that has all ended. on top of that our economic cycle is now on the downside. we're not in expansionary mode after seven years. we'll probably slow down a little bit. put that in the global economy where it is, you can get, you can, i will not predict it, you can get massive correction in major stocks indexes. >> this is what is happening in the financials right now. the reason why banks,
financials, big asset managers are down, not because people are worried they will collapse in bate, a lot of it is they will earn a lot less than people hope they would. for years we're being told low interest rates are hurting banks, when rates go up it should help them. trish: thing is rates will not go up. they will not make as much money. >> there is one stock, most heavily piped stock in the world might be going up and it is fannie mae. >> it is going down. >> it is going down today. here is the thing. fannie mae went into receivership in 2008. this is such a weird stock, on day like this -- people buying market, don't go near the stock. in receivership but heavily touted. you're an expert. trish: buck 65 for fannie mae. >> when i started warning people this was not investment. that it was gamble, that you shouldn't buy shares of fannie mae, shares were trading north
of $5. they're down to buck 65. they are going to go lower. there are people out there who are, they have websites. they're on twitter, and they're constantly trying to pump the stock. >> big investors is in it. bill ackman. dick bove likes it. why do they like it so much? >> if i was gambling with other people's money why not take a shot with it? ackman thinks, ackman thinks it can go to $40 and selling for 1.60. trish: i want to go back to overall market. market is off 354 points. 16,549 is your level. cheryl casone at floor of new york stock exchange and john carney from "wall street journal" and very own charlie gasparino. one of the topics that came up on this set, chairman, whether or not we're in crisis of 2008, different version. warnings from carl icahn several months ago. warnings today from george soros. what are people saying down
there on the floor? is this part of what is contributing to this selloff, fear of unknown? perhaps the fed is out of ammunition and may have created a situation for itself that it just can't get out of? >> that is interesting. one of the traders i was talking to, back of his mind, under his breath, wish fed would come in. maybe we'll get qe. that is one voice. most of the guys down here are telling me they don't really expect any kind of interest rate easing if you will which would be strange for the fed to do. going back to the fed story that they raised interest rates too quickly when the economy was not ready for the shock -- >> we're never, i'm growing a beard before we get qe. trish: i would like to see that, charlie. >> could happen, fed put off rate increases. trish: that should help markets. >> that might help market. here is where you dovetail back to this fannie mae and speculative invests.
when you get this much qe, low interest rates, people look for yield and gambles. why so many people put into this overly-hyped -- >> remember their investment thesis involves defeating the u.s. government. suing the u.s. government, when you have to sue the u.s. government for your investment to succeed it is not investment anymore. it's a gamble. >> whoa. >> when guys like -- berkowitz made a lot of money sided with u.s. government. bought shares of aig and shares of bank of america. he went opposite way. >> they do have a good point the government is stealing all company's profit. >> government takes all profits. remember the u.s. government is only reason these things still exist and only reason they could do any business. nobody would buy guarranty from those countries on mortgage-backed securities. >> all the court cases? they say they have wins? >> they lose every time a judge ever made a ruling on them they lose. right now they still have couple open cases but those judges
haven't even said whether they have jurisdiction over the case much leslieened to the merits. >> we have ten minutes before the close. chairman -- cheryl casone on floor of new york stock exchange. what is it. >> 320 million shares traded. pointed over the last month we're 33, 35% higher than normal as far as volume goes down here. that shows conviction. decisions are being made, selloff choice is being made as we're nine minutes away to the close, that is the choice being made today, today, charlie. you know i'm a positive gal, charlie gasparino. i try. >> what i love about you. suppose the fed has to race rates? you talk to a lot of people in the market. they're afraid of other forces. trish: isn't that what happened last time around? >> if they don't do it more so, take down the market a lot we're setting stage for huge bubble in
other assets? >> they're absolutely sure they will raise rates a couple more times. a lot of market participants don't believe that maybe we'll get one more rate raise, but ending year at 1% isn't going to happen. trish: stay with me, cheryl. we want to bring in patrick case sar he is watching selloff. very heavy volume today, patrick. do you think this is something that will continue into the rest of the session, rest of this month, rest of this year? >> well, right now what i see a market driven by emotion. there are two major emotions dominate the market, fear and greed. what you're seeing today clearly fear. obviously continuing rest of the day. there is only few minutes left. tomorrow i have no idea. this is emotion, not rational thinking. trish: why do you not think this is rational at all? we had a lot of rational people saying there could be fundamental problems. we could be looking at another
recession. china is not in great shape. very concerned the fed overspent what it can do and has no bullets left in its arsenal? >> you know, the data, underlying data on u.s. economy like we're living on two different planets. planet optimist has 250 peoples and planet pessimist thinking we're heading into recession what have you. underlying economic data in the u.s. is pretty good. employment picture is strong. u.s. economy is looking pretty good. china has been weak for two years. we've been talking about china being weak for two years. trish: that's a good point. >> trish, i disagree with him. i'm sorry. trish: let me add to this point. i think that there are a lot of reasons to be concerned about china because of its influence on overall world economy but, cheryl, keep in mind we're $18 trillion economy. used this stat before. $150 billion less than. >> we're growing at 2% though. we're growing at 2%.
that is the problem. >> exactly. you guys talk about fear, this is just fear. no this is based on can you believe the chinese government? many traders i talk to say you can not. that's -- if we get better answer out of china's markets and all wake up tomorrow and feel much, much better fine. we'll take the markets back up but for now there is a big unknown factor. that is the real factor. i'm sorry we'll get jobs report tomorrow. that is another thing we're talking about down here, trish. 5% unemployment rate. yeah, again, what are those jobs? come on, they're low-paying jobs. trish: 5%, eight is what it used to be. my gosh you're right, cheryl. >> not seeing wages rise very much. they have gone up a little bit. normal times. if you got down to 5% unemployment you would expect there to be a -- >> degree of inflation we just don't have right now. trish: that is what is messed up. why people talk about some kind of crisis, charlie, how do have
an environment -- >> why would you have -- think of systemic pressures. we're not talking about big-time correction or recession here. think of systemic pressures. are banks healthier than in 2008? absolutely. do banks hold on to inventory that might be problematic, no? do we have savings and loan crisis in no. maybe carl is worried about junk bonds. trish: income -- junk bonds. >> you can't hold them! can't hold them! >> this will be trouble for funds that hold a lot of these or companies raising money in the junk bond market. will not be crisis for banks. they hold very large portfolios of very safe securities, u.s. treasurys, fannie and freddie mortgage-backed securities. >> backed. >> backed by the u.s. government. trish: hold on to that thought. i want to go to lori on the board. >> that's right, trish. tech one of the leading industry of 2015. now obviously turning south and
one of most highly depressed sectors in the new year. we've been following precip tis decline in oil prices. you're looking at dow 30. these are dow components. only issue in the green is wall the ma. walmart down 30%. it is one. most popular stocks in this young new year up about 1.53. only gainer on the dow jones industrials right now. let's back up to talk about technology here. we put some of the headline stocks, hewlett-packard, off 4 1/2%. look at these gaps lower. twitter is getting all kinds of traction, down 5% or attention i should say. gopro had horrible earnings report. down another almost 8% here. yahoo!, marisa mayer spending a fortune. they're all gapping lower. anything a winner in 2015, obviously nasdaq was one of benchmark three indexes ended out year with gains is under significant pressure. high volume, sharp selloff. trish: high volume. that is the key here. cheryl casone?
>> looking at stocks, excuse me, some stocks hitting 52-week lows on s&p 500. and a lot of them are energy names. i think that is crucial here. we haven't really talked about what is happening in the oil markets. eric bolling called that one. williams company. anadarko, devon energy, marathon oil, these stocks hitting 52-week lows. devon energy, seven 1/2 to the downside. these are big names to watch now and to watch tomorrow obviously. trish: any predictions for how this is going to shake out tonight in china and thus our markets tomorrow morning. >> i betcha our markets bounce okay on decent employment. >> if we don't get bad employment number markets will come back if we get a pad number we have bottom fallout. >> nobody thinks they will rapidly raise rates this year.
that is baked into the pie. fed will definitely not lower rates no matter how bad -- >> they can't. >> that will destroy credibility. we'll probably get a good number. that will be probably enough to stem the market. >> three stocks this morning were in the green. now only walmart. >> wall mart, as we were saying a lot of stocks fallen from their highs. significant number have fallen 20% or more off their highs. we get ready to approach final minutes of trading, as bell is about to ring, market off 370 points off the lows of the session. challenging day. 16,533. down 2%. we shall see. those final trades. they're settling out. thank you, charlie gasparino.
john carney, patrick caser, cheryl casone. great to have all of you here as we get ready to ring final moments of trading off 378 points for the dow. david and melissa. over to you. melissa: trish, thank you so much. worst start of the year since 1991. stocks getting hammered again. the stocks have lost over 900 points since monday. billionaire george soros says we're facing a crisis. he has a financial reason to say that. david: he does but sometimes i listen to the guy. you don't know whether he will be right. melissa: our panel weighs in. david: china sparking global selloff, taking big risks that backfired big time. we have a experts with what you need to know about china. melissa: middle east on the brink. iran accusing saudi arabia of bombing its embassy in yemen. will proxy war they have been fighting turn into something even more real? come oliver north will join us
on that one. david: the colonel knows. back to the bloodbath on wall street. [closing bell rings] it was over 400 points at one point. now closing at 386 points. closing none too soon for all traders down there. huge day tomorrow with jobs report coming in at 8:30. that might set the pace. so will china about which more in a moment. all indices down well over 2%. look at nasdaq over 3% drop on nasdaq alone. only thing up by 17 bucks is gold. melissa: walmart once again the lone bright spot on the board. that is not good. we have got you covered. jeff flock in the pits of cme in chicago. first cheryl casone in middle of all action on floor of new york stock exchange. tell me what happened down there. >> last ten minutes or so,