Skip to main content

tv   Closing Bell  CNBC  April 15, 2016 3:00pm-5:01pm EDT

3:00 pm
>> i can't wait to never have to drive the car. >> exactly. >> totally on that one. >> have a good show later tonight. >> we'll see everybody at 5:00 on "fast money" tonight. >> "closing bell" starts right now. >> welcome to the "closing bell", i'm kelly evans down here at the new york stock exchange and bill you're hanging out with other people. >> yes, i am, i'm here at the world headquarters i'll do nightly business report on pbs, if you can join us. stocks lower today, lackluster for the major averages once again though we're near the lows of the session but crude oil is the big story today. you can see that the utilities are the best performing sector so a pretty defensive section today. but energy, pinned at the bottom, that sector under pressure ahead of that key
3:01 pm
meeting in doha on sunday. we have citigroup head of commodities saying we could see a big sell-off in crude oil come monday morning if a credible agreement is not reached this weekend. and ed morris will join us live to explain all of that in just a minute. >> those big banks are pulling back slightly after rallying this week. there's another financial group moving higher the last couple of weeks. we'll tell you what that is and if it's sustainable coming up. apple shares falling just in the last hour on those reports. i think we've got the chart. there it is, down 1.7%, lowered iphone production in the first quarter. why? we'll have details on that in a little bit. >> and after the bell today, investing guru bill miller tells us why he's buying valeant right now. >> he's got big expectations for that stock now, doesn't he? >> doubling i think he said. we'll press him on it.
3:02 pm
>> let's start with oil dropping ahead of that key opec-like meeting this weekend in doha. jackie deangeles has all of the details. >> we conducted a exclusive survey to figure out where people stand in terms of vision on pricing and what they think we'll hear from it. a little more than half of the participants thinksz there's more than a 50% chance something could happen at this meeting but not necessarily sure what. they don't think we'll see a production cut, that freeze could still be in play. and we have had this doha risk premium for past few weeks. really difficult to figure out what the street is thinking at this point but barclay's saying the outcome isn't necessarily that important. bullish comments coming out of the meeting could influence oil prices as well. the one thing that everything seems to agree on, saudi arabia is the swing country here.
3:03 pm
saudis need to agree with iranians on a freeze before anything can potentially happen, even before their agreements with russia that people have been speculating on. they have been tough negotiators and ramping uch production, opec production also up. they are looking at this from a market share standpoint. thep don't want the iranians to get too much of a hold in the oil market here. it goes beyond oil for saudis as well. it's about regional stability. so a whole lot of confusion as we head in into doha but all eyes on that part of the world on sunday. >> back to you. >> thank you. our jackie deank lis, our next guest says so expect a sharp sell-off if no deal is reached over the weekend. ed morse for citi. he joins us now for more. i'm surprised people are expecting anything out of meeting this weekend. we've already had indications
3:04 pm
that production is going to keep happening. how likely is it the saudis and iranians come to some kind of agreement? do you really pin the movement in oil lately on expectations for this weekend? >> that's a lot of questions. first, on the saudi/iranian situation, no, the iranians have said even before sanctions were lifted that they intend to get their old market position restored and they won't have any discussion about it at any point in the future until they get that market position restored and maybe add a million barrels a day to that. they claim that others particularly saudi arabia have taken their old market share. why should they participate in anything until the saudis participate in the cutback. on the other side. the saudis have said clearly, only ten days ago, not to expect them to do anything unless there's a movement on iranian
3:05 pm
side. if there's going to be an agreement, it's going to be a gentleman's agreement and yes, to answer your second question, i think as do most of us, that the exceptional length we saw in the market growing up until this past week was a reflection in market expectations that something was going to come out of this meeting. and they thought it for a variety of reasons and now it's just too risky to hold that position going into the meeting and that's why we're seeing the sell-off. >> we have so many questions because there are so many moving parts and pieces to this story. iran just being one of those along with saudi arabia and russia, we're not talking about the other countries as well. venezuela has been suffering as a result of this. our own oil business has suffered job losses saerlts. what will happen to them if they are able to come up with some kind of production freeze here? you're still expecting countries to cheat, aren't you? >> we're not expecting a freeze of any sort other than a very at
3:06 pm
best loosely worded gentleman's agreement to try to hold the line and see what's happening. i think the difference between now and more nervousness about the subject in january when we saw the market sell-off and stayed low into the early part of february is now people are much more relaxed about whether there's an agreement or not. we're seeing the markets actually tighten up. the iea report of this week yesterday indicated that the ia saw the oecd countries having a close to $700,000 barrel a day drawdown into march. that would indicate that markets are tightening for a pretty good reason. we've seen relly an incredible amount of oil disrupted from the markets. we're not seeing a spike in price but brent related crude was off the market, 630,000 barrels of day because of an explosion on a pipeline, another 300,000 barrels a day of
3:07 pm
nigerian crude from a pipe line explosion and another couple hundred thousand of colombian crude. we're living in a balance not that great between supply and demand. there's a problem with inventory but not on the supply/demand side. >> just to put this in context. opec was informed when the market share of those countries i don't know if you know offhand but i assume was much higher than what it is today and who knows then if we're followed by argentina or other countries using fracking technology to join the fray. where do we stand in terms of opec's representation of the overall oil market anyway? >> in 1985 when the saudis also had a market share strategy, the oil market was 60 million barrels a day, it's 97, 98 million today. opec was $30 million of that $60 million a barrel a day market.
3:08 pm
history has not been on their side. they kept their market share down because they the had lowest cost oil in the world and see the margin to get a higher price. now with fracking and u.s. really the largest liquid producers in the world by a hefty number, they have to re-evaluate that position and think that's what the saudis are doing, oil out of the ground is worth more than oil held in the ground. that's why the market share strategy today seems to have a more permanent edge than it did in the 1980s. >> ed, thanks for joining us. it will be a fascinating weekend and we'll see what happens come monday. >> let's talk about this among other things in our closing bell exchange. rickedleman is with us today and steven gilfoil from deep value at post nine at the new york stock exchange and rick santelli from chicago as well.
3:09 pm
sarge, what levels are you looking at? still holding at 2085 on the upper range? >> that's where your resistance is. there was support yesterday and early today. they did pierce it. it is back over it now. i think that's the level you want to see us hold tonight. if it breaks we can go down to 2060. we don't want to see that. then we move on. i don't think levels are what most guys are looking at right now. what we're looking at right now is the underlying macro which has been awful. if you want to go through it, we have a nice beat in empire state manufacturing this morning but that's about it. we've had -- i'll read it because my brain isn't that big. small business optimism and retail sales and cpi, industrial production, cap you and consumer sentiment he all in the toilet. >> what do you make of these markets? >> there's an awful lot of noise and possesscy mix and sent ent
3:10 pm
is dropping to separate the noise from their long-term objectives. odds are you're going to be wrong and it's not going to do an awful lolt of good into next week. >> your anticipation of the -- we can't call it an opec meeting, russia is in on this and top oil producers but do you expect anything to come out of that? what do you think markets will do with it on monday? >> i'm not optimistic. >> rick santelli i was asking. >> sorry about that. i'm always fascinated by how markets like to price information that every vinester doing the trading knows there's no way to verify. are the talks going to bring substantial meaning in any issue we can sink our teeth into. even if it does, i don't know we have a firsthand way of knowing but i think the markets will still trade. as i look at the charts, i think the answer is easy.
3:11 pm
they are all going to cheat but commodities in general are turning. and that as we sit here in this quasi40 plus area, 60 will draw it up in a magnet, a much more powerful fashion than 30 draws do the down side. will that be it? no. what we're looking at in kmotdties and rrb index over the next ten months, it's a shadowboxing with 10-year note yield charts and almost exactly identical. that makes sense. it's a process. but i think the worst is behind us although the worst is among us when is it comes to that data. sarge is spot on. to see unitization rates under 75%, haven't seen that since august of 2010, a bit disturbing. if you want to handicap recession, don't look at the -- look at product levels, that's where you'll find your clues. >> inflation pressures or lack
3:12 pm
there after. rick? >> i think we're going to see short term volatility no matter what comes out of the markets -- out of this crazy meeting on sunday. although it's going to be imp t impactful, it will be forgotten by thursday. >> how about this crazy meeting, what if it is a rus by the russians to sell $42 a barrel for the wti crude? what if this is just a game and maybe the saudis were in on it? >> you're always looking for that one little angle, the conspiracy theories there. >> there's always somebody that deserves a nice punch in the nose there, bill. >> thank you, guys, everybody have a good weekend. we'll see you later. wefl a news alert on intel. what's going on, josh? >> bill, these headlines on intel just dropping, according to oregonina, preparing for significant job cuts this
3:13 pm
spring. some units will see double digit percentage cuts and thousands of job cuts across the country by the end of the year. we should point out cnbc did reach out to intel which offered no comment on this report. intel obviously under pressure as stocks down about 10% year to date of the ongoing concerns about the weak pc market. bulls will argue intel already discounts a lot of bad news in the pc market and more interested in that data center business. we'll find out more next week. intel does report earnings on april 19th but again, the headline here that intel is preparing for significant job cuts this spring. back to you. >> josh, thank you so much. this could go a couple of different ways. in the near term, if the bad news gets out ahead of the earnings release, the shares might price it in. on the other hand if they were hoping it wouldn't get out for some time, pointing in general to the challenges it fact faces, it may give more cause for concern. >> the semis are leading
3:14 pm
indicators for other industries as well. if they are seeing problems we'll have to do layoffs we'll probably hear bad news from other sectors that rely on chips that intel makes as well xbl sure, great point. those shares -- down about 1% on the session today. by the way, we have 45 minutes to go here in the close. watching a couple of interesting bellweathers today, intel being one of them and apple earlier, s&p is down 2.5 points and nasdaq only about 7. >> the financials on pace to outperform the broader averages this week. have they climbed too far too fast we ask? wilfred frost and mike santoli weigh in on that. bill miller thinks valeant pharmaceutical shares could double and putting his money where his mouth is. he'll join us live after the bell. you're watching cnbc, first in business worldwide. you both have a
3:15 pm
perfect driving record. >>perfect. no tickets. no accidents... >>that is until one of you clips a food truck, ruining your perfect record. >>yup... now, you would think your insurance company would cut you some slack, right? >>no. your insurance rates go through the roof. your perfect record doesn't get you anything. >>anything. perfect! for drivers with accident forgiveness, liberty mutual won't raise your rates due to your first accident. and if you do have an accident, our claim centers are available to assist you 24/7. for a free quote, call liberty mutual at switch to liberty mutual and you could save up to $509 call today at see car insurance in a whole new light. liberty mutual insurance.
3:16 pm
3:17 pm
wilfred frost is here with a lowdown on citigroup earnings and mike santoli is looking at the runup in shares of asset
3:18 pm
management companies. >> the latest report citigroup beat on the top and bottom line. beat coming mainly as trading fell less than expected and expenses were under control. grabbing the attention with all of the banks was the energy provision of $455 million. this was in line with forecast but like wells fargo, they did not seem confident yet this was the worst quarter. that's in contrast to jp morgan who felt the worse is behind them in terms of energy write downs. on the retail bank in the u.s., citi saw year on year growth for first quarter for first time since 2008. this is perhaps the takeaway of the week for me. yes, q1 saw volatility and we have the hike back in december but loan growth was good and we're reminded how much a single 25 basis point rate hike does for bank's profitability of the on the flip side. lots of focus on big falls in capital market erngsz and general theme is investment banker worse than equities in
3:19 pm
fixed interest and market business picking up and deal making still hasn't. given the top headline environment, so far banks have performed well there. important to focus on next week for goldman sachs and morgan stanley is head count, the others so far succeeding in cutting costs without axing jobs. overall the s&p banks up nearly 6% for the week as a whole, a good week for banks, no doubt about that. >> indeed. stay there. let's get to you, mike. shares of asset managers have been quietly rallying and that's something you pointed out as well. >> the very end of february i did a piece saying that the asset management stocks were looking very cheap. the market was pricing in a full-out bear market with heavy outflows from mutual funds and other funds these companies manage. it's not been an earnings story in terms of recovery basket of eight big asset managers and
3:20 pm
black rock, investco and big names, about 14% in the six weeks since the end of february. that compares to about 9% for the financials as a whole for the sector and several percent for the s&p 500. these are basically leveraged plays on the financial markets. so when stock markets go up, these stocks go up even more. but on other hand, they are more stable business and not as dependent on fed policy as core banks are. that's one of the reasons i think money has rushed back into this group as a way of betting on stability in the financial sector, not necessarily rushing off to new heights in the stock market. >> correct me if i'm wrong, but i thought when black rock's results were out this week they were under weming for people. >> they were in general, they more or less came in the zone of expectations but i was struck how black rock shares responded yesterday. they gap down at the open a bit and rally 6.5% through the end of the day. inflows into black rock funds for $36 billion in the quarter.
3:21 pm
black rock is amazingly well 5 trillion. they own i shares and etfs earn have exposure electric, they are the blue chip standard for the industry. it's not been about the earnings being that great. that's why from here on, i think it's a lot more about not just their own results but about essentially do the markets hold together and can we bet investors are will not flee these funds. >> with the kind of gain you were talking about the banks have enjoined. the question becomes have they risen too far too fast here? >> i think it's a fair question but if we look at bank of america share price year to date it paints a pretty clear story. it's up about 8% this week, a big gain but it's still down 15% year to date. and it's start of year to trough performance which was then for february was down almost 30%. we've rallied from the lows but we're still down year on year.
3:22 pm
i think the other point to take notes comes back to the pickup in the profitability in the traditional banking side of things. during the quarter we've had such focus on the energy lows and capital market falls and specter of interest rates around the world. that doesn't apply to the u.s. traditional bafrpging era. we had a rate hike and we'll are less through the year but the december hike feld through very well and that was a positive. >> as we mentioned off the top, so much hangs on this economic growth. mike, we'll see you in just a bit. georgia os born in washington for the imf spring meetings where the brexit has been a major topic and it's a big concern for markets here too. julia joins us live from washington with the chancellor. julia in. >> thanks so much, let's get straight into it. chancellor, thank you so much for joining us. let's assume it's the morning of june 24th and they voted to exit
3:23 pm
the eu, what's the fallout? how bad is it? >> first of all the british economy is growing and one of the fastest growing in the world, attracting lots of investment and this is a big democratic exercise that resolves that great uncertainty which has been britain's relationship with europe. i hope they vote to remain in and they are getting clear messages there are economic benefits for remaining in and costs if we leave. if we do leave, we'll have to deal with that situation. there will be a two-year negotiation around the exit from the eu and of course our bank of england will be alert to the financial stability consequences of that. but we're clear, leaving would cause economic shot and long-term economic cost for the uk and that's one of the messages they are hearing. >> polls as tight as they've been, 50/50 and ftse traded at the highs of the year.
3:24 pm
you could argue actually that this moment investors are not worried either way. >> there is some impact on investment, delayed capital investment, some impact on commercial property. the bank of england pointed to this in the monetary policy committee minutes this week. what i hope is we have this big argument. i hope the country votes to remain in the eu and then we can really get to work on reforming the eu and actually seeing the upside. look, people have focused on the risks of exit but there's real benefits of remaining in and creating a freer trade more open market european union. >> let's say that actually the british people then do as you say vote to remain in. your party split right down the middle in europe once again. it looks like a lose/lose. >> i don't think so. having just won a general election, we promised to hold the referendum and people doubted we would do it. we delivered on that commitment.
3:25 pm
i think that earnings us trust with the british people. look, different conservatives in britain are on different sides of the argument but the overwhelming majority of the cabinet wanting to remain in the eu and there's a real coalition of the conservative government and labor party, and businesses large and small and trade union movement. it's quite a gathering of people all saying the same thing. and i think once we get this referendum over with and as i say i'm confident they will vote to remain in, then the government will continue with its economic reforms that are delivering pretty strong results at the moment. >> there is one voice that isn't agreeing with that and that's johnson. are you disappointed in him? >> the thing about a referendum is that anyone, whether boris johnson or anyone else, can shir view and make their argument and the great thing is whether it's me or boris or whoever, we've only got one vote each, like everyone else, just like every other british citizen.
3:26 pm
>> suggested that president obama would be a hip poe krit if he's in favor of the uk remaining in the eu, does that make him an irresponsible candidate for a future prime minister? >> i think it's perfectly right that we hear from international voices and heard this week from the imf. we've heard this week from the oecd and we've heard from a number of finance ministers and foreign ministers around the world, including the u.s. treasury secretary. and so i think actually the british people want to hear what people think. the overwhelming sense you get at the moment, still got a couple of months to go to this campaign, people want more facts ar more information. >> i want to talk about tax as well. you dealt a hammer blow to tax evaders today but the uk property market receives inflows from middle east and russia and we've seen that as crisis have hit those regions. are you saying that money invested in those regions is not welcome if it's not clean? >> look, we don't welcome money
3:27 pm
that's not clean. let's be clear about that. we'll use our law enforcement agencies and laws that we're agreeing not just domestically and internationally to deal with that. i think having a strong well run clean system is perfectly consistent and indeed is it a precondition of being what london and uk, the center of global finance and center for emerging markets from chinl that to india to the middle east. britain has led the way in getting these international agreements on things like exchange of personal tax information or registers on who owns companies or the new tax code for multinational companies. i think it's precisely we can demonstrate dploebal leadership. >> thank you so much. george osborne, thanks. >> thanks to the chancellor as well. not so much on people's radars yet here in this country. but i guarantee if brexit happens, kelly, i think we'll be
3:28 pm
raising those questions we asked a decade ago about the future of the whole eu, right? >> sure, it's on the radar screen of a lot of the major banks. goldman is in the middle of building a brand-new head quaurtders in london and has a huge presence there as a foothold into the broader single market as it's known. plenty of them are concerned. scott minerd told us yesterday that he thinks it's definitely something that could burst to the forefront and looks like britain will leave. you'll see more of a discloeks of markets, not to say it's going to be permanent but not an outcome that seems priced in. >> for sure. the dow down 23 points right now. again, lackluster trading going into the close probably waiting to hear what doha does with the price of oil on sunday. coming up, apple lagging. we'll tell you what's eating into the tech giant stock. >> also ahead, noted value investor bill miller says he's
3:29 pm
buying shares of val yant pharmaceuticals and thinks they could double. he joins us coming up.
3:30 pm
what if it were your job to make the world a more beautiful, colorful place? at ppg we think that's something we all need to do. we create, invent and formulate amazing paints, coatings and materials. so we can make the world run faster, stronger, fresher, smarter, cooler, lighter, greener and better for the next generation that comes along. ppg. we protect and beautify the world. in new york state, we believe tomorrow starts today.
3:31 pm
all across the state, the economy is growing, with creative new business incentives, the lowest taxes in decades, and new infrastructure for a new generation attracting the talent and companies of tomorrow. like in rochester, with world-class botox. and in buffalo, where medicine meets the future. let us help grow your company's tomorrow - today - at business.ny.gov
3:32 pm
here's a pair of big movers today, this friday shares of bats global surging from the $19 a share initial public offering price that started trading this morning, raising 252 million dollars in its ipo. valued the company overall at $1.8 billion. the exchange operator had to cancel its ipo four years ago because of a software bug that disrupted trading shortly after the stock listed on its own exchange. i guess second time was the charm. sea world entertainment lower, downgrading the stock to neutral from buy aefrn citing market share losses to peers in recent years, he is speshespecially un
3:33 pm
owned by our parent company, comcast. >> have you seen a otter eat a shrimp? >> been to a turkish bath, where are we going with this? >>, they turn the shrimp over -- >> you know what i think as otters, i plan to come back as one because they have no natural enemies. >> you ought to do that. time for a cnbc news update. >> at a meeting at progress cast, czech republic agreed to shorten the name to czechia. nearly 2000 people gathered in cairo to protest the egyptian president's decision to hand over two red sea islands to saudi arabia. the government maintains the islands belong to the saudis who asked egypt in 1950 to protect them from israel. a judge refusing to reduce the $500,000 bond set for two
3:34 pm
wisconsin girls accused of trying to kill their classmate in an attempt to please the functional horror character slenderman. both were 12 years old when they lured their classmate into the woods and repeatedly stabbed her, almost killing her. they had been in custody for two years. delta airlines is dropping the $25 fee for boking a flight on the phone and getting rid of the $35 flight to book a flight in person at the airport. the airline can afford to lose that revenue it made $4.45 billion in net income in 2015. back to you. >> they have a new ceo coming and i'm hoping this is the beginning of a new trend. but it depends on other airlines following suit as well. >> we have to see all of them do that, yeah. >> night homy hopes are not tha >> depends on doha too. >> yes.
3:35 pm
>> yes, that goes without saying. we have to see what doha does on sunday too. >> see you on nbr tonight. >> first we're going to see her again next hour. 25 minutes to go here. the dow is down 22 points. s&p down one and nasdaq down four. up next, netflix in the spotlight ahead of its earnings report monday. whether now is the time to buy shares after this. at mfs investment management, we believe in the power of active management. by debating our research to find the best investments. by looking at global and local insights to benefit from different points of view. and by consistently breaking apart risk to focus on long-term value. we actively manage with expertise and conviction. so you can invest with more certainty. mfs. that's the power of active management.
3:36 pm
perfect driving record. >>perfect. no tickets. no accidents... >>that is until one of you clips a food truck, ruining your perfect record. >>yup... now, you would think your insurance company would cut you some slack, right? >>no. your insurance rates go through the roof. your perfect record doesn't get you anything. >>anything. perfect! for drivers with accident forgiveness, liberty mutual won't raise your rates due to your first accident. and if you do have an accident, our claim centers are available to assist you 24/7. for a free quote, call liberty mutual at switch to liberty mutual and you could save up to $509 call today at see car insurance in a whole new light. liberty mutual insurance.
3:37 pm
3:38 pm
less than 30 minutes to go into the weekend. joining me is tim anderson from tjm investments as we're awaiting this meeting may be they've been given access to capital markets. >> certainly for the oil shares. that's really been a game changer over the last six to eight weeks. there was a point in time in february even early march where general consensus was the oil companies -- other than the highest quality names had very limited access to the capital markets, probably couldn't raise money even if they had to and
3:39 pm
then there were a couple of deals done in early march, and even in the basin and we've had close to $10 billion raised in the last six to eight weeks. and that every time that's happened, stock has acted positively regardless of any dilute gs going on. we'll see if that can outweigh whatever happens. thanks for joining us. >> teake a look at shares of netflix, a good weekend for the company they are set to report first quarterarnings monday after the bell. all eyes will be on subscriber growth internationally. here in the u.s. they expect to see 46.5 million for first quart quarter compared to 44.7 million last quarter. is this stock a buy?
3:40 pm
max is with us and we've asked julia borsten to give us perspective. what about that perspective? this is a company that is doing pretty well these days. getting ready to raise rates as well, right? >> yes, so they are going to be implementing rate hikes for their older subscribers. you'll see about a $2 rate hike per month and that's going to be rolled out over the course of may. that's only impacting about 17 million us subscribers, it's still very possible there will be a very small impact. ubs estimates 3 to 4% of subscribers in the u.s. could be impacted from that. the bigger question is how far netflix is growing overseas where they recently rolled out to 130 countries. we could see massive numbers there. the company itself forecast the addition of 4 million new international subscribers in the first quaushter. >> max, would you be a buyer of netflix? >> no, i wouldn't. like the company think it has a
3:41 pm
brut bright future but don't think it's a great discount. people have been forced into growth name. it's a great growth name but slowing growth name. 400 pes make us nervous. don't like the price. >> 400 price to earnings ratio. >> if you act right now, a hair's breath over 400 if you want this one time deal. >> clearly the market appreciates what they've done so far, right? >> absolutely. the fact that this is a company that's been able to continue growing its business both in the u.s. and overseas and there does seem to be huge growth potential overseas. the reason why netflix has worked so far in the past couple years, they've been able to roll out a huge number of hit shows, they have so much data on what people want to watch, they've been able to have hits like "house of cards" and totally different categories like kimmie schmidt and had a great record
3:42 pm
here. if they can use their information about what people want to watch to give them more of that and have that content be exclusive, even $10 a month seems like a pretty good deal. >> max, my cable company told me i can watch hulu on channel 300 something. as this happens and added to traditional cable packages, is that good for the company or transition them into a more mature phase. >> it's probably good. the u.s. market is more mature. the company shadowed is entry into china. there are people who do what netflix does, the over the top streaming thing is crowded and it's going to get more crowded. we like this name first and foremost but it's going to get more crowded. it's going to grow more slowly and like the company and future but we don't think 400 pes are the new black. we think they are the old
3:43 pm
orange. not that in in our minds. >> well put. good to see you, thanks. julia, see you later. >> little more than 15 minutes left in the session before the weekend, we're seeing red across the board. dow giving up 31 and s&p about three and nasdaq nearly six. >> in the last 90 minutes, apple has been putting a drag on the tech sector. susan li has the lowdown next. >> i'll talk to bill miller who will explain why he's putting money into valeant. stay tuned for that. hats ifferent doing small gigs,side gigs...gig gigs. quickbooks self-employed helps me get ready for tax time. to separate expenses,i just swipe. it's one hat i don't mind wearing. [passenger] i work for me. and so does quickbooks. it estimates my taxes,so i know how much stays in my pocket. and that's how i own it. [announcer] stay in the flow with quickbooks self-employed. start your free thirty-day trial today at join-self-employed-dot-com.
3:44 pm
3:45 pm
3:46 pm
a report came out and susan li is trackinging that story among others. >> apple being the main drag at the nasdaq, not surprising and started to weigh after 1:00 p.m. after the news report hit the wires that said the iphone production cuts would be extended into the june quarter and along with apple we're looking at iphone suppliers and apple suppliers like broadcom and skywork solutions being some of the main decliners here at the nasdaq.
3:47 pm
apple, it's been down 13% over the past 52 months. though it has rebounded 13% in the past three months. it looks like we have earnings coming out on april 25th. going the opposite direction, both classes of going on the positive end at the nasdaq. apple down is 2% into the close. back to you. >> thank you so much, we'll watch it and we have a news alert on president obama's tax returns. what's happening here? >> the white house just put out president obama's tax return. here it is, april 15th and of course we have the barack obama 1040 form, according to what the white house just put out here, the president reports adjusted gross income of $436,000. the obamas pay 81,472 in total tax and the president's effective income tax rate is 18.7%. so far this looks like it's about 45 pages long. we're going to through it and
3:48 pm
find the interesting tidbits including how many the obamas made in book royalty income and other things. what the white house is saying, total income for the president just over $436,000 this year. he did okay, kelly. >> he did fine. just a reminder, everybody, it's april 15th but because of emancipation day in washington, d.c., we're not paying taxes today. most of us on monday except in maine and massachusetts, where it's patriot's day on monday, they pay on tuesday. everybody with me on this. >> boston marathon is coming up on monday. they said they were releasing the vice president's as well? >> we'll get the vice president's as well. they just posted that to the website and haven't had a chance to go through it. we'll see who made more this year, the president or vice president. typically it's been president obama but we'll take a look at it. >> i'll ask the loaded question, are we expecting any of the presidential candidates to release theirs? >> the one we're waiting for is bernie sanders who has said he
3:49 pm
will file and disclose. his wife jane, traditionally in the family is the one who handles the taxes and been busy on campaign trail. we're expecting to see sanders put out his returns at some point here. we're not sure exactly when that's going to be and that will be an interesting one to dive into as well. >> indeed. >> thanks so much. >> ten minutes to go. art cashin said 500 million to buy on the bell and dow down 40 points. >> despite today's market dip, this is a cheery day it says at least according to david darst weekly acronym. >> and bill miller joins us to explain why he's become a huge bull on valeant and putting his money where his mouth is, behind the stock. that's coming up after this. e*t, where investors can investigate and invest in vests... or not in vests. this is my retirement. retiring retired tires.
3:50 pm
and i never get tired of it. are you entirely prepared to retire? plan your never tiring retiring retired tires retirement with e*trade. professor richard thaler. you are called the father of behavioral economics. i've been called a lot of things. i have read all of your books. did you learn anything? i learned that humans are complicated. we're emotional. absent-minded. and we make some really bad decisions. my trade-off analytics can help companies make better decisions,
3:51 pm
but i am still learning what makes people tick. what makes you tick watson? natural language processing, reasoning algorithms, statistical parsing. now you are just showing off.
3:52 pm
the dow off 36 points into the close and it's time for david darst here at post nine. what are you watching? these markets? >> kelly, i think one is the amazingly high number of investors and american association of individual investors survey, 47% are neutral right now. the long-term average is 31%.
3:53 pm
people are sitting on the fence trying to get some sense of direction. i've said we want to look at a five or six things. spell the word cheery. c is china. improving. fixed asset investment, retail sales and exports and imports. you saw the flow this week. secondly is a happier flow, "h" for happier flow of economic data in the united states. you've seen the chicago purchase manager's index and philly fed and empire state. that having been said, they've started to pick up. that having been said, the gdp now, atlanta fed is very low, .3%. e is europe. and that is a further out thing that we got to keep an eye on, the brexit debate, whether britain leaves the european union on thursday july 23rd that's the voting date. the other e and most important letter in this acronym is
3:54 pm
earnings. and even if you take out energy, kelly, even if you take out energy, the s&p 500 earnings, year over year are supposed to be down 4.2%. you want to focus on areas that have defensive characteristics and sustainable yields. these could be energy companies, could be some consumer products companies. beverage companies overseas exposure. >> we've got to move, two more letters, russia and saudi arabia and then the yen. it's too bad didn't put saudi arabia first it could have been cheesy. what are you expecting out of doha? will it matter in the scheme of things when we know it's just a handshake agreement and they could still cheat beyond the freeze they might be expected to agree to? >> great point, bill. the markets are looking -- they were hoping to get some sort of freeze there. the fact that iran is sending a lower level minister rather than a full fledged minister
3:55 pm
indicates they may not be on board. however the markets are just hoping for some good sign there. i see oil weaker today, bill and kelly, amazed you're going to love this. the partnerships since february 13th are up 26%. be selective. you can select some mass limited partnerships as well as energy companies that can keep their dividend. the bottom line bill and kelly, there's so much oil at curbing, oklahoma that soon if we keep producing like this, they are going to throw oil all over the place and that bb destructive in the price structure. >> put in every swimming pool in the country one executive said. we hope it's a cheery weekend as we come out of it. >> we're coming back with the closing countdown. >> and after the bell, donald trump not in the political headlines for a change, instead as a fiery democrat being presidential debate. ted cruz's cnbc appearance and
3:56 pm
larry kudlow's one on one with john kasich. they have people talking for sure. we'll cover it all coming up. he? i'm val, the orange money retirement squirrel from voya. we're putting away acorns. you know, to show the importance of saving for the future. so you're sort of like a spokes person? more of a spokes metaphor. get organized at voya.com. you ppremium like clockwork. month after month. year after year. then one night, you hydroplane into a ditch. yeah... surprise... your insurance company tells you to pay up again. why pay for insurance if you have to pay even more for using it? if you have liberty mutual deductible fund™, you could pay no deductible at all. sign up to immediately lower your deductible by $100. and keep lowering it $100 annually, until it's gone. then continue to earn that $100 every year.
3:57 pm
there's no limit to how much you can earn and this savings applies to every vehicle on your policy. call to learn more. switch to liberty mutual and you could save up to $509. call liberty mutual for a free quote today at see car insurance in a whole new light. liberty mutual insurance. [bassist] two late nights in blew an amp.but good nights. sure,music's why we do this,but it's still our business. we spend days booking gigs, then we've gotta put in the miles to get there. but it's not without its perks. like seeing our album sales go through the roof enough to finally start paying meg's little brother- i mean,our new tour manager-with real,actual money. we run on quickbooks.that's how we own it.
3:58 pm
i am benedict arnold, the infamous traitor. and i know a thing or two about trading. so i trade with e*trade, where true traders trade on a trademarked trade platform that has all the... get off the computer traitor! i won't. (cannon sound) mobility is very important to me. that's why i use e*trade mobile. it's on all my mobile devices, so it suits my mobile lifestyle. and it keeps my investments fully mobile... even when i'm on the move... ahhh. little less than 90 seconds left, let's see with the closing countdown for this friday, bob
3:59 pm
pi pisani joins me. another up week, second one out of the last three. 1.8%. wti very much in focus. crude oil up 1.6%. then the earnings get under way really in earnest, very busy week next week. this is just monday in part, netflix and ibm aend pepsico reporting as well. >> the big industrial companies on wednesday we'll get illinois tool works and textron, and then on friday, big ones general electric, caterpillar, honeywell. i'm interested now, it's one thing for the banks to say business is all right. if we start hearing from the big global companies and say business is improving, definitely you'll see the
4:00 pm
markets moving on that of the congratulations to that team over there at bats, finally exercise that diemon of four years ago. >> ringing the closing bell at the big board, members handicap children's funds and nasdaq, universe soul circus. stay tuned for hour two. i have a taste for shrimp tempura, kel. >> welcome to "the closing bell." closing out the week with a dow clining 31 points and s&p down 2 points and nasdaq down 7 for the week. financials the best performer and nine out of ten sectors in the green this week. again, today going out with a little bit of a loss. coming up bill miller has been buying shares of valeant because he says the stock could double. he'll join us in a few minutes
4:01 pm
to explain why. we have senior markets commentator mike santoli and evan newmark and for more "fast money" trader tim seymour. oil is under pressure today, is that the whole story? sfwl it's a big part of the story. being up at these heights, multimonth highs, that, the test. oil pulling that hard would be the test. you've had an amazingly gentle trading, holding on to most of the gains, even with today, modest loss at the index level. new york stock exchange positive. and that's been the rule for a while now. the majority of stocks have participated in this rally. >> i thought i saw something yesterday, no 52-week lows. >> i heard a revision it was not zero but one. if it was zero, it goes back many years before you can find that and the cumulative list of
4:02 pm
advancing and declining stocks have made the all time high. all of these things suggest if we fall back, market is under somewhat decent footing than last year. >> mike likes to call the grandma portfolio, general mills, coca-cola, valuations pretty high. >> if you want to think the stock market is going to go higher, you have to think interest rates will go higher and financial stocks will go higher. i'm not saying that's the case. i'm saying if you believe that the s&p can go up another 5 to 10% this year, you have to believe that the banks and oil stocks can take it there and the global economy will grow. you have a weird mismatch and you have stocks doing very well but still a bid for a flight to safety. you have mortgage rates this year, 1.5, two-year lows and 10-year bond is 1.75.
4:03 pm
if you don't see the 10-year close to 2% by the end of this year, it's hard to imagine you'll have a booming stock market. >> you have goldman on tuesday. you mention how the financials have to participate, but it doesn't mean they have to behave the same way. maybe we're seeing that within the big money center banks. what would you do with goldmans and morgans? >> i'm a big believer that the former brokerages goldman sacks and morgan stanleys will have a harder time making money than the j px morgans and wells fargos because there's been a commoditization in the financial services industry in general. it really, if you don't have a lot of ipo activity and don't have a junk bond rally, you don't have a lot of private equity engagement, really hard for the goldman sachs to make money with fixed income being a dead area. >> we did finally get bats
4:04 pm
listing, trading up 20%. what does that tell you about that business itself or whether the pipeline flow starts to pick up here? >> i prefer to speak more about the pipeline evan is talking about goldman's business. i agree, we're largely side ways unless we get financials picking up. what we started to learn from jp morgan, that the investment bank and capital markets activity started really actually thawing out substantially by early march and certainly by the end of march. if you believe we're in a trend where they'll have volatility, i think the capital markets will quarter over quarter come roaring back. jp morgan did a report on this showing how pent up the demand is for fixed income securities because it was so far down in the first quarter. you get to a place where financials are underowned and the bar is too low.
4:05 pm
i think goldman is probably the most interesting of the ones yet to report. i think they will recover but i think their business and core business has recovered and the big question for the group is do you believe that this again this calm in global markets can stay? i'm not sure about that long term. >> i was going to say, i could certainly see the case in which financials step up a little to the plate. they were kind of left for nothing and are way down in terms of their share of the market cap overall. if you're going to get them to go beyond catching up to everybody else, where are we in getting to the higher rate environment? >> you would want to see the steeper curve. for goldman trading at levels it got to over a decade ago. it's not as if this is a challenging number if they can keep growing book value. it's a boring story and doesn't get them leading market and dragging it higher. you're right, the data is not
4:06 pm
supportive of the idea that we're going to get rate hikes or that really we have reflation in the u.s. or developed world. >> when you start seeing stories how lloyd blankfine is cutting costs, that's usually not an indicator that there's super optimistic about the next couple of quarters. >> what about emerging markets? suddenly -- >> that's really kind of an oil and dollar raid. i don't know. i think the good news on that front has been china hasn't blown up yet. we've talked over the past quarter we had this discussion in january, china is blowing up, global recession, u.s. falling into recession. none of that has come to pass. i don't think the economy is great but i also think, it's a nice spring day outside. there's -- wages are coming together. starting to grow a bit. i think the economy will do better than people think -- >> here. >> in the u.s., but it's not -- there's no gang busters, you don't feel you're in the middle
4:07 pm
of something about to take off. >> a related emerging market, the odds of rousseff's impeachment after a key vote on sunday. seema watching this for us. >> brazil's lower house of parliament is currently in session discussing whether they should move the impeachment proceedings of president rousseff forward due to allegations she mishandled the country's budgets accounts. a final vote is due on sunday. if two-thirds vote in favor of the impeachment, it moves to the senate. outcome of the senate vote in may could result in rousseff immediately stepping down for 180 days as a trial would kick off. the vice president would sit in as president and he's already reportedly working on introducing a series of reforms. brazilian stocks and bonds have been moving higher in hopes that rousseff will get out. there's a 70% chance he'll get
4:08 pm
impeached. she won't go down without a fight. and the broader implications on stocks and the economy. >> thank you. it's interesting, tim, how well brazil has held up this year. it's kind of shocking actually. what happens now? >> 37% up in dollar terms i agree, not going without a fight. the party which was the coalition partner to her party up to this impeachment process started is pushing hard for her to be impeached. there's a lot of good news into the impeachment process but brazil is one of the markets where there's been this con va less sense period which means a slow gradual recovery. i'm not buying brazil tomorrow and you set up for disappoint mts next week, if he is impeached, fiscal policies moves that much forward to unlock the economy doesn't happen. i would have to say the worst
4:09 pm
for the durnt currency is largely -- this isn't going to happen overnight and not a rally with a couple weeks to go. once we put in foundation, should be buying into this rally. >> tim seymour, there's more coming up at "fast money", talking apple's warning to the world and whether a tech wreck could be coming. shares of valeant plunging 70%, that's not scaring away bill miller. he says the stock could double. he'll layout the bold case and barney frank and larry kudlow are coming up. you're watching cnbc, first in business worldwide. they found out who's been hacking into our network.
4:10 pm
4:11 pm
who? guess. i don't know, some kids in a basement? you watch too many movies. who? a small business in china. a business? they work nine to five. they take lunch hours. like a job? like a job. we tracked them. how did we do that? we have some new guys defending our network. new guys? well, they're not that new. they've been defending things for a long time. [ digital typewriting ] it's not just security. it's defense. bae systems.
4:12 pm
>> welcome back, shares of valeant down 70% this year. bill miller whose chairman and cio of llmlc is increasing his stake in the company saying the stock could double. bill miller joins us on the
4:13 pm
phone for more. good to speak with you again. would love to hear you layout the case. is this a trade bill on the sentiment having gotten way too negative or do you think this company longer term should be worth double what it's trading for today? >> nice to be with you, we bought a very small position in valeant late in the first quarter and have not completed a position in the last few weeks, we're full up on it right now. the stock is around 32. probably the most toxic name in the market of the one of the things that attracted us to it, the headline risk going back to when the stock peaked about i guess it was august of last year. and since then it's become lost 90% of the valley peak to trough and been in the papers almost every day. worries about the debt and worries about the pricing and the business model, worries about mike pearson.
4:14 pm
i think from a behavioral standpoint, just about everything who thought about this is probably gone which got us attracted to take a look at the numbers in more detail. the most interesting thing about valeant, the bonds of valeant, which we bought the bonds in the income funds they had a nice rally in the last few weeks. now valeant's debt yield, 8.5, to 9%. the last time the bonds traded here the stock was 55. the equity has not caught up with the rally in the bonds. the company has 30 billion, little more than 30 billion of debt. we have them looking around $7 of free cash flow this year and $9 of free cash flow next year and virtually all of free cash flow we believe will be used to pay down debt. when you have a busted rollup like valeant or like when we like platform specialty, if those businesses they bought are good cash generating business,
4:15 pm
the cash will be used to pay down debt and as that debt declines, that value accrues to the equity. we think it's -- as we look at it, that it's -- it's worth at least $60 and we can get significantly higher prices depending what happens. >> are you planning to be in this for a few years? but you know, again to move forward, to be anything like a $200 stock again, it seems there would have to be different factors in terms of business model we're working. are you looking at this from the point of view, one of these is mispriced and we're betting the stock and it's going up and or i like the fund amouount amountal? >> it's more the latter. who knows if it will ever see $200 again. i think they bought a collection of businesses, some very good
4:16 pm
businesses some no so good, but the core idea was sounds. the problem was it was carried too far like a lot of good ideas are and there was a lot of -- i'd say not just -- i would say -- i think there was aggressive behavior driven by the incentive structure to get the stock higher. as we look at it, specialty pharma area is very depressed compared to where it traded. we think these businesses. if we got a business that will generate trading at $32 and $9 of free cash flow next year, typically a business like this would tend to trade around ten times free cash flow. other things equal and without the controversy. that would put it at $90 at least potential price in a year or two. i think that's not unrealistic. you know, i think probably the earnings numbers will still have to come down and may have to sell businesses to reduce the
4:17 pm
perceived financial risk but there's so many what about this and what about that with valeant. just as they begin to disappear i think the stock moves higher. >> would be horizon which has been hit in sympathy here? >> i haven't looked at horizon. we are looking right now at endo, a valeant take to it because the ceo used to work there. they trade in the 6% range. i think that gives a sense of market is less worried about endo than it is about valeant and the stock on the headline earnings is 4.5% or 4.5 to 5 times earnings and mostly generics. we haven't done enough on that too have strong conviction yet. >> you mentioned valeant can double. i know that attracts you into companies like that when you see the opportunity for bigupside. are you seeing that from we look
4:18 pm
at the banks these days? they have been depressed. you've spoken in the past about how low you thing the odds are for a another financial crisis and having a positive view of the economy. we have goldman coming up and heard from the big money center banks. do you think the financials would have similar upside longer term here? >> not similar -- well, depending how long the long term is. the financials are -- the financials are cheap relative to the market and cheap relative to history to their own history on a price to book basis. i do think that you are looking at gradually higher interest rates over next couple of years and every 100 basis points is about $4 billion for jp and same for bank of america. i do think they have taken a hit this year that's not unwarranted given what's happened but when you saw bank of america trade higher in what was considered a miss yesterday, i thought that was a very good sign. looks like the financials have
4:19 pm
bottomed to us. there's cheap financials out there. one of them is the one named financial which is now the largest subprime lender in the country. the stocks in the mid-20s and it will do $4.5 this year and 6 bucks of earnings next year. we think you can search around financials to find some really great names. we own xbrxt p morgan and citi and bank of america as well. >> as long as we're talking subprime, what about fanny and freddie, would you be back involved in those names? >> those are very different. i do think the unsealing of some of those documents that came ut oerlier this year and led to the big rally is significant. i'm not a lawyer but i would certainly think there's a case to be made here with these things. even a case to be made that they were -- that their seizure was more political than economic
4:20 pm
eve event. that falls into the too hard bucket but it's completely up to the courts. we don't have a competitive advantage in that. >> we also have ibm coming up next week and community has been split about this one. guys say stay away from it but analysts communities getting more positive there. watson a growth center for them as they try to be more of a platform company. do you like ibm? >> ibm has had a really big rally here it's a cheap stock. they printed something like -- it's like 12 or 14 consecutive quarters of declining revenues. if the revenues start to grow at ibm, you should get two multiple point turn on it. and you can see how the sentiment can change on a name and microsoft was in the dog house for a long time and talking about the cloud business there. ibm has staying power, brn around 120 years or so.
4:21 pm
that's -- i don't think it's going anywhere. >> and with regard to intel, we heard about job cuts reportedly today. we've talked in the past how you like an amazon, not necessarily looking into other tech parts of the market but any read through there from intel with its own results coming up? we've also heard about apple, how maybe its product order growth is slowing as well. a couple of names there that people are trying to make sense of and figure out what the narrative was with intel specifically, what do you think? >> we don't own intel i don't have a take on that. we do own apple and apple is one of those names that everybody has an opinion about. the market tends to be a little schizophrenic on apple with respect to these reports and fly suppliers about this and that. with apple, laura martin wrote a good report on apple and probably on cnbc one time that day. but i liked her take on it,
4:22 pm
which is you really have an eco system here and if you look at the return on the capital productivity, apple is greater than that of facebook. the margins are bigger than disney. it's one of these businesses that if you didn't think of it as purely a hardware company, it would be trading dramatically higher than it is. we'll get a new capital announcement out of them very shortly with respect to dividends and buybacks and it's not going to be -- they are certainly not going to be cutting dividends or buy back program but giving the way the balance sheet looks. apple is a good solid value here. >> we have to let you go. any other company you think is a double here? >> well, actually i think amazon is a double in the next three years from here that cloud business continues to go gang busters, amazon is the fastest company to 100 billion of revenues in world history and
4:23 pm
the cloud brings is growing much faster than enterprise business growing much faster than the retail business and it can be as big as the retail business the stock got hit on fourth quarter numbers so it's -- declined this year so far, way behind the market. and we think that the fact it's begun to do better in the past month or so in the stocks begin to act better indicates that people will figure out that that surprise margin compression in the fourth quarter was one that's not going to be repeated in the coming quarters. >> you've been a believer the whole way. good to hear your thoughts and get an update. thank you for joining us. >> thanks, kelly. >> thoughts? >> you know, i've talked about how tyco experience might be a model for what happens ats valeant, seems to be bill's bet here. obviously the debt story will
4:24 pm
tell and did they overpay for acquisitions? a lot of people think the answer to that is yes. >> it's a punt. what bill miller said, i don't know what it's worth. i'm going to bet the market overreacted here and the underlying businesses can pay down the debt and i can still come away with doubling my money. it's a punt because nobody can say whether they bought bausch and lomb. you may never return to the margin structure. >> they certainly have their work cut out for them. the tech sector has been reds hot the last three months. coming up we'll hear from a tech pioneer that says the story that shaped our society in recent years is now over. first chipotle is hoping to take a bite out of the burger industry. what does it mean for shake shack, we'll hear from danny meyer when we come back.
4:25 pm
there's a lot of places you never want to see "$7.95." [ beep ] but you'll be glad to see it here. fidelity -- where smarter investors will always be. if only the signs were as obvious when you trade. fidelity's active trader pro can help you find smarter entry and exit points and can help protect your potential profits. fidelity -- where smarter investors will always be. you ppremium like clockwork. month after month. year after year. then one night, you hydroplane into a ditch. yeah... surprise... your insurance company tells you to pay up again. why pay for insurance if you have to pay even more for using it? if you have liberty mutual deductible fund™, you could pay no deductible at all. sign up to immediately lower your deductible by $100. and keep lowering it $100 annually, until it's gone. then continue to earn that $100 every year.
4:26 pm
there's no limit to how much you can earn and this savings applies to every vehicle on your policy. call to learn more. switch to liberty mutual and you could save up to $509. call liberty mutual for a free quote today at see car insurance in a whole new light. liberty mutual insurance.
4:27 pm
we believe in the power of active management.management, by debating our research to find the best investments. by looking at global and local insights to benefit from different points of view. and by consistently breaking apart risk to focus on long-term value. we actively manage with expertise and conviction. so you can invest with more certainty. mfs. that's the power of active management. the burger wars are heating up now that chipotle is opening up a burger chain for its business. kate? >> it's no surprise meyer is a burger fan but told me he actually welcomes potential competition from chipotle and doesn't give him any pause or concern. >> no, i love chipotle and as
4:28 pm
much as i love shack burgers and i do, i love any burger. i love in and out burger on the west coast and burger at gramercy tavern and north end grill. i love the burger at o'connell's pub in st. louis where i grew up. i haven't too many burgers i didn't love. >> you welcome burger competition. >> i love it. >> and ske shack fans in north carolina may be waiting a long time for that cult favorite to come to the state. i asked my meyer if the bathroom bill would prevent him from doing business in north carolina. >> it would. >> why so? >> because i think one of the things that small businesses have the opportunity to do is to take a stand on things and actually part of the way that we attract the best talent, i think is to take a stand. listen, i'm somebody who believes that we should be free
4:29 pm
to do what we choose to do. i'm not going to take a position what you should do or anyone in your audience should do. i know how i feel and i'd love to do business in places and bring our products to places that they feel welcoming to all people. >> i caught up with meyer at capital one small business town hall where he also discussed the need for better worker protections and sky high rents in new york city. >> what did he say about sky high rents? >> he had to relocate his famous union square cafe out of the location it was in for more than 30 years because the rent got too high. he's opening up another location this spring not too far away. he's experienced it himself and says, he feels bad for business owners that go through this and sympathizes with landlord that have real estate in the neighborhoods that got to be popular and hot and making a living too. >> it's almost like someone could start a political party, the rent is just too -- >> the rent is too damned high.
4:30 pm
>> meyer made a lot of money in new york dealing with high rent for the last five years. >> he's a lower margin business now if that's even true. >> you look at the lines outside the shake shacks and margins should be pretty good. >> union square -- he also went to no tipping and very high in restaurants because the economics of the business work better and you don't have to fight talent wars and pay people in an equal way as opposed to just front of the house. >> i'm curious to see if that one spreads. time for a cnbc news update. hi, sharon. >> indian army troops in cash kashmir throwing rock killing one person and injuring three others. protests began earlier in the week following allegations that an indian army soldier tried to sexually assault a teenage school girl. gop presidential candidate john
4:31 pm
kasich campaigning in new york holding a town hall in watertown. he fielded questions before urging the crowd to get out and vote for him. cirque du soleil is canceling shows in north carolina to protest a state law that it says is discriminatory to the lgbt community. this follows other artists like bruce springsteen and ringoxts starr who canceled appearances in the state. boston marking the deadly anniversary, a moment of silence was held at 2:49 p.m. when the first of two bombs detonated killing three and injuring 260 others. that's the cnbc news update at this hour. back to you, kelly. >> thank you so much. >> will donald trump and hillary clinton be able to hold their leads? barney frank and larry kudlow
4:32 pm
weigh in next. we'll discuss why that's not scaring off suitors like verizon and daily mail later on "the closing bell." accessible by thousands of suppliers and employees globally. but with cyber threats on the rise, mary's data could be under attack. with the help of the at&t network, a network that senses and mitigates cyber threats, their critical data is safer than ever. giving them the agility to be open & secure. because no one knows & like at&t.
4:33 pm
4:34 pm
great time for a shiny floor wax, no? not if you just put the finishing touches on your latest masterpiece. timing's important. comcast business knows that. that's why you can schedule an installation at a time that works for you. even late at night, or on the weekend, if that's what you need. because you have enough to worry about. i did not see that coming. don't deal with disruptions. get better internet installed on your schedule. comcast business. built for business.
4:35 pm
welcome back, breaking news on mcgraw hill. >> mcgraw hill financial is going to sell jd power for $1.1 million to the zio group. they are expected to close during the third quarter of 2016 and mcgraw hill will change its name. what do we know? it's a china based buyout firm and offices in shanghai and hong kong and london and $5 billion under assets. interesting to see giving the type of m and a we have seen this year. >> rob cox put it best on the panel yesterday in the recent column saying it's now the era of the chinese buyer you've never heard of. >> didn't end well for the japanese. >> that's true. two of the republican presidential candidates speaking out, ted cruz on squawk box and larry kudlow caught up with john kasich. >> the fed has for those with
4:36 pm
assets driven up stock prices and assets values but that's not built on anything real, an increase in on the intrinsic value, just based on playing games with money which means a crash will be coming. >> voters think if a politician's lips are moving they are lying. i have -- i can show evidence what i say i've already done and can accomplish again. in washington, i move the system down there. >> you're inferring that senator cruz does not have those leadership skills? >> he didn't accomplish anything the whole time he's been in. what is he going to say i didn't do this all this time but now i can do it? come on. >> for more reaction, joining us now, senior contributor larry kudlow himself and cnbc contributor barney frank. good to see you again. barney, first to you, what do you make of the comments you're hearing on the campaign trail today? >> well, i thought john kasich was describing bernie sanders
4:37 pm
when he said having been there for a long time and not accomplishing anything. what makes you think he's going to do it? the fact is that senator sanders now is in 25th or 27th year as a member of congress and i don't doubt his sincerity, but i do think it's legitimate for people to say, given your lengthy service in congress, you're the longest serving politician in the race this year by far. what can you point to? and i think that becomes a valid point. that's why for instance, he has virtually no support from the members of congress, including those democrats in the black caucus, gay and lesbian members and hispanics, the ones most committed to change are overwhelmingly for hillary clinton. >> larry, do you think that's because vermont has a strong brand name in this country? >> no, i think it's a very odd race, frankly. this is the year where the insiders are out of fashion and the outsiders are in fashion.
4:38 pm
this a populist revolt going on in both political parties. it's interesting, barney is talking about how sanders has been in office a long time without achieving much. i think that's a fair remark. kasich was referring to cruz as a guy who has been there a short time and hasn't achieved anything and kasich himself is a career guy as congressman and governor. john kasich is in a tough fight for second place in new york particularly on tuesday. then in pennsylvania next week. donald trump is likely to win both. cruz is trying to get back into second place. they are fighting hard for delegates, that's the bottom line there. kasich took a swipe at cruz. >> let's reminds everybody about the fireworks last night in that democratic debate between hillary clinton and bernie sandsers, it was in brooklyn and they spoke about clinton's involvement with the big banks during the financial crisis. >> i stood up against the
4:39 pm
behaviors of the banks when ichs a senator. i called them out on their mortgage behavior. >> secretary clinton called them out. oh, my goodness. they must have been really crushed by this. and was that before or after you received huge sums of money by giving speaking engagements? >> boy, if looks could kill. barney, what's your reaction to that? >> it's really unattractive demagoguery, almost mccarthyism. he snows tfgs well before. i would like to change the financial contribution system in the country. but when sanders runs an ad that says in effect, not quite exactly but clearly the message, look at goldman sachs, they weren't punished and that's probably because people are getting speaking fees. hillary clinton wasn't getting speak fees until well after she was in the senate and after she
4:40 pm
had been secretary of state and by the way, that's an attack by sanders on abobama, he claims he's not. secretary of state has nothing to do with punishing financial institutions and there's as i said this element of mccarthyism. one of the questions said to sanders, can you point to any action that secretary clinton took, any policy choice by hillary clinton that reflects the financial influence of the banks? he couldn't do it. he can't do it because there is no such one. that's why i said, he makes an accusation that public policy stances with influence by this. i don't think people regarded some of the banks regard me as their best friends. i take speaking fees and i think i'm an interesting speaker. that's why cnbc has me on. this notion that you only get paid because you're going to
4:41 pm
somehow retroactively go back and fix things for them is demagoguery. >> i think you're a really interesting speaker, barney frank, we should take this show on the road. >> i agree. >> it will be terrific fun. i'll just say that, that was a rough debate. barney is right, it's like a bad marital spat and republicans have been having it for many months. and regarding mr. sanders, he's now calling corporations immoral and destroying moral fabric of the united states. that's utter nonsense. businesses create jobs and wealth and put people in school and give them health benefits, most of the companies down through the years if you average out the losses during recessions pay a lot of tax. america has the highest tax rates in the world. all of this should be fixed. we need tax reform to fix all of this stuff. you want to get rid of loopholes an deductions and credits, i'm
4:42 pm
all for it. my point is, sandsers should distinguish between immorality and the need for tax reform. >> last word. >> i very much am critical of the abuses, i'm sorry some people weren't prosecuted. it's one thing to say there were abuses and bad incentives but another to say the whole business model is corrupt. that's not true and people on the left should not be indulge ent when our fellow ideologues make statements unfair and sweeping and unfounded as the people we criticize on the right. >> good for you congressman, frank. >> here on closing bell in the meantime, larry kudlow, barney frank, have a great weekend. >> we'll hear from a tech enperfee entrepreneur and what he thinks will take over from it. none of the potential suitors
4:43 pm
know about the financial health because it's reluctant to share it. we'll ask next.
4:44 pm
4:45 pm
yahoo! is getting ready to accept bids next week but potential bidders may not get as much financial information about the company as they'd like. there have already been gloomy projections from the company for the current year but yahoo! has not discussed its outlook for 2017 and possible issue for those kicking the company's tires, how big of an issue could
4:46 pm
this be? one of a particular company that was left out i guess of the details in some potential bidders were looking for what's tumblre, their future growth strategy, revenue unclear. >> i think potential bidders would want more visibility into every piece of the business. i think what it comes down to, this was an unusually kind of wide open loose process of selling a company or a business. it was come in, see what you like, make a bid on some part of it on the whole thing, whatever you think. this is the first round of bidding. if you make a bid here or express interest, it's not binding. it's sort of like a first -- i do think it's understandable for some of the potential bidders to say we don't have enough to go on to come up with a firm value. >> as someone who once upon a time ran these options, everybody will leak to the press, every complaint they have and process is a disaster. >> even the number of people involved, might not actually be 40 different suitors, might only be a couple -- >> any don't care.
4:47 pm
all they need is a couple who want it bad enough. that's what they are counting on at the end of the day. there will be a couple of people still standing who are willing to bid against each other. if they don't know exactly what the revenue run rate is from tumlre, it won't be the end of the world. >> if i'm yahoo! and want the best possible purchase size for my company and all of a sudden, there's only one or two buyers and they are not getting the clarity they want, doesn't that put them in a better position to negotiate down the price? >> it does and potential seller could say no thanks. there's no clock ticking in a real way. clearly appearances will be terrible if they just withdrew from the sale process and yahoo! management did. but i do think that preserves leverage, the idea that we're exploring options here. >> it must be -- i saw there was a list of like five bankers working on behalf of yahoo!. the thing is as i've told you before, kelly, a dog's
4:48 pm
breakfast. >> your favorite britishism. >> it's a dog's breakfast, at the end of the day they wants two people who are interested in the assets and willing to bid and make sure if there are private equity people involved there's enough financing. if they get verizon -- >> to pay up the stupid price, then everybody goes home feeling they are a winner. >> it will be interesting to see what marissa's position will be in all of this as well. >> the driving force behind our economy and society for years now, our next guest says that's about to change and he'll explain why. tech earnings will take center stage on monday. we'll have instant analysis of results of netflix and ibm and intel as well. all of that right here on "the closing bell." but not every insurance company understands the life behind it. for those who've served and the families that have supported them, we offer our best service in return.
4:49 pm
usaa. we know what it means to serve. get an insurance quote and see why 92% of our members plan to stay for life.
4:50 pm
4:51 pm
welcome back. is the tech story over? that's what the ceo and editor-in-chief of newco says on his latest piece on medium saying technology as a central narrative of change is over and that business now needs to take the lead. john joins us now with more. so curious about what you're deeply implying here, john. i almost can't, you know, separate out tech from business, from capitalism, from all these different things, but you're
4:52 pm
signature out there in the middle of all of this so how is the world changing as you see it? >> well, i think we for the last 10 or 15 years have really made technology the driving story behind our understanding not only of business but all of society, and really by writing that piece i'm trying to reframe the story back on not so much tech and all the tech billionaires and the unicorns and the fundings and all of that, but what are we doing with it? what are we -- what kind of business are we making? what kind of society are we making? i think we need to think about taking the lessons of technology and particularly the companies that are doing so well as tech companies and using them horizontally in all sectors of our economy. >> just bringing in the panel. evan, what do you think? >> the question is who is we in the sense that i think if you went to the alphabet folks, google folks they would say, you know, it's hard to parse out the difference when you have
4:53 pm
driverless cars, for example, is that business? is that technology? i mean, what is that? you know, what does it have to do with search engines? all i'm saying it's really to kelly's point it's become pretty blurry, and i'm not sure you're able to pick out the strands and say this is technology and this is business and never the two shall meet. >> yeah, everyone, i think you're sort of making my point because by focusing on tech i think we're missing the larger story about a significant shift that's happening in business culture overall and it's being driven by a lot of different large secular trends, one of them having to do with very large companies, you know, the nestles, the p & gs and gms of the world, having a very hard time hiring the best and brightest into their companies because those kinds of people now want to work at companies that do more than maximize shareholder value. they want to work at a company that has some kind of purpose that's going to make the world a little better because they know we're living on a shot clock right now, and we have to beat that shot clock. >> yeah, you know, john, what
4:54 pm
you're saying really does bump up against a lot of other issues that are sort of taken separately whether it be, you know, these production difficulty gains in some parts of the economy that put big segments out of work and the sort of misallocation of human resources, i guess, across the economy, you might say, from the outside, but how -- how in practice will big companies and maybe governments try to approach all this? >> well, i think that's the conversation that i'm really interested in being part of and with our new publication exploring and covering which is we need to ask these really large questions and we need to spend time having that conversation. when the average tech company and netflix earnings was just teased in the last break. is that a technology company or just an entertainment company, and those kinds of companies now create ten times fewer jobs than the industries they are replacing. >> yeah, john, also to your point -- >> the question is what kind of society are we going to build
4:55 pm
that can handle that kind of shift? >> domino's was -- what shifted my attention, if you will, when i remember patrick doyle, the ceo, said we're not a pizza company but a technology company. i think about the new ads that began electric has talking about how it's hiring engineers and doing all sorts of industrial applications there so across the business world what you're saying is the technology is getting out of tech sector and it's going to change the rest of the economy, right? >> well, unquestionably it already has. >> yeah. >> right now technology is table steaks and technology will continue to amaze it, but it's table steaks. we need to move the -- shift the focus from gee whiz technology to kind of a business culture are we building and how can we get to the next level of business? >> happening on the campaign trail also. join, thanks for joining us, ceo and editor and chief of newco. the latest film in the "barber shop" series hitting theaters. we'll hear from two of the film's stars on why it's
4:56 pm
becoming harder to make movies these days. back in a moment. so why pause to take a pill? and why stop to find a bathroom? cialis for daily use, is the only daily tablet approved to treat erectile dysfunction so you can be ready anytime the moment is right. plus cialis treats the frustrating urinary symptoms of bph, like needing to go frequently, day or night. tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. do not take cialis if you take nitrates for chest pain, or adempas for pulmonary hypertension, as it may cause an unsafe drop in blood pressure. do not drink alcohol in excess. side effects may include headache, upset stomach, delayed backache or muscle ache. to avoid long-term injury, get medical help right away for an erection lasting more than four hours. if you have any sudden decrease or loss in hearing or vision, or any symptoms of an allergic reaction, stop taking cialis and get medical help right away. ask your doctor about cialis for daily use. insurance coverage has expanded nationally and you may now be covered. contact your health plan for the latest information.
4:57 pm
there's a lot of places you never want to see "$7.95." [ beep ] but you'll be glad to see it here. fidelity -- where smarter investors will always be. if only the signs were as obvious when you trade. fidelity's active trader pro can help you find smarter entry and exit points and can help protect your potential profits. fidelity -- where smarter investors will always be. ♪ i could get used to this. now you can, with the luxuriously transformed 2016 lexus es and es hybrid. ♪
4:58 pm
herthey work hard.ade, wow, that was random. random? no. it's all about understanding patterns. like the mail guy at 3:12pm every day or jerry getting dumped every third tuesday. jerry: every third tuesday. we have pattern recognition technology on any chart plus over 300 customizable studies to help you anticipate potential price movement. there's no way to predict that. td ameritrade. >> is it easier to get movies done? harder to get movies down, how does it feel? >> cedric can speak on it more
4:59 pm
than i can because he does a lot more but definitely harder, no? >> definitely harder, something waiting that has a predominant african-american cast and you need other movies to do well. because you have so many big names you have to do some sacrificing to get a movie like this made. salaries, shot the other two in chicago, had to shoot in atlanta for the tax breaks. >> that was bob pisani talking toy is trick the entertainer about the new "barber shop". >> the mid-budget movie is going away. have you to scrap. >> i saw this past week a movie "tangerine" made on an iphone on netflix right now, made for under $500,000, and it was i thought an excellent movie. in fact, it's easier to make a movie right now. probably hard to make a mainstream movie. >> that's a great point. check it out. check it out. "tangerine," really interesting. >> have to get a netflix account first.
5:00 pm
>> everyone, thanks for joining us. mike, thank you so much for sitting with us. that does it for "closing bell" on a week where finally we saw the sectors positive. it was a tougher slog last week. we head into a big weekend. "fast money" begins right now. "fast money" on this friday does start right now. live from the nasdaq market site overlooking new york city's times square. i'm melissa lee. traders, tim seymour, steve grasso, brian kelly and guy adami. tonight on "fast" if you missed the move in the banks we over got the next group of stocks that could soon surge higher. the traders will break it down. plus, you think earnings will matter to stocks? our own steve grasso says it's something else that can determine the market's next move. what that is and the one dow stock that could see a new all-time high next week, the name and how to play it. first, we start off with what could be a troubling sign for tech. apple shares falling on reports it's cutting iphone production in light of sluggish sales. is apple signaling trouble for tech as we head into a

30 Views

info Stream Only

Uploaded by TV Archive on