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tv   Closing Bell  CNBC  August 28, 2017 3:00pm-5:00pm EDT

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that yellen didn't say more, i guess. >> exactly and also the strength in the euro is really pushing this all around of course, the president, president trump, visiting texas tomorrow so that's going to be certainly something that we're watching, corpus christi, so we'll watch that thanks for watching "power lunch," and thank you for joe kernin. >> "closing bell" meantime starts right now >> and do not adjust your television for the world wide exchange it's "closing bell." welcome everybody, i'm sara eisen here in for kelly oven. >> and will i'm wilfred frost in for bill griffeth. more rain in houston is expected and a number of refineries along the gulf coast have shut down until the storm is passed. we speak to the head of parentson uti coming up.
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>> $99 for a case of water, that's the type of price gauging that the attorney general is seeing in the state. he'll join us to tell us how he's cracking down on all that have. >> and next hour president trump is likely to address this catastrophic flooding in a news conference with the president of finland. we'll bring you that live as soon as it begins. but we start in texas. contessa brewer is in houston with the latest on the flooding and brian sullivan is in galveston with a look at how hurricane harvey is affecting refineries contessa, we'll start with you. >> reporter: the bayou has overflowed its banks, normally parkland, and this historic building here was due to be completely renovated by fall of 201. as you can see, they will probably have to go back at t.houston at this point is mostly a ghost town. businesses shut down, employees stranded there are some 3 million people who work in the metropolitan houston area most of them i would guess are
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out of work today because the roads are simply impassable. you can't get around the bayou is blocking many of the downtown roads, and the interstates coming in. what we saw at the convention center today was people pouring in trying to escape the flooding we have brand new news coming in from interest district the houston schools that were housing shelters of last resort already no longer accept new evacuees they say because of safety reasons they can no longer -- and accessibility. they can no longer accommodate them so they are now referring people to other shelters in the area and back to the convention center we're also seeing some talk here of how much money this is going to cost to get houston back in business, and what we've seen is some congressmen who experienced this kind of devastation for hurricane sandy saying they will vote money for text, representative peter king one of
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them, making a snoid kent ide c because he refused to vote for sandy aid. he wouldn't take the bait. >> there's plenty of time pore politics and i'm not going to worry about that my focus is on the people dealing with the tragedy i've been spending the day and night working with officials, speaking with the vice president, the cabinet agencies and trying to marshall federal assets to save lives. >> reporter: sara, wilfred, he issued a challenge here in houston to step up to the plate, to bone you and help eve other and make sure employees are safe and help other employees from other companies stay safe as well we just got an update on the number of rescues here more than 2,200 rescues have
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taken place in houston, and they are on going at this hour. sar area, wilfred. >> contessa, what can you tell us about mandatory owe vacations? as we understand it, there are a number in place right now in the houston area, but perhaps coming a little bit too late as people are already finding themselves stranded. >> reporter: well, and the problem, too, is they are trying to gauge with the release of the army corps of engineers releasing water from these two dams, how much flooding they are going to deal with what we've seen is that the flooding has receded in some parts of downtown houston, even as it's taken over other parts of houston, and i talked to a family at the convention center about being evacuated, and they said it just came too late it didn't happen, and they were trying to carry a first grader and a third grader through chest high water the dad says he's 6'4", up to chest height on him trying to get them out of a home that had flooded. it was just devastating. >> yeah, absolutely. contessa, thank you. be safe, as you make your way around houston to help show us
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what's happening here. let's send it over to brian sullivan he's in galveston for more hon how the refiners are being impacted by the storm. brian? >> reporter: i'm going to switch it up here, sara and wil, because it goes to what contessa was talking about. i don't know if you can see it buds on our help it's a mandatory evacuation order for dickinson, texas dickinson texas is a son of 18,000 people roughly where we werier remember all those scenes of people on the interstate being rescued by good samaritans with flat-bottom boats. we were there in the morning it's interstate 45 dickinson, texas, just getting a mandatory evacuation order that literally crossed three minutes ago. now, the question is, and i'll get to the story in just a second having been there yesterday twimpts y twice. you can't go east because there's the bay and you can't go north because interstate 45 is flooded. that's the reason they are probably issuing the evacuation
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order. west is you have to because a number of highways are hurting there because we know that from police officers and individuals who have come from there and we've driven a little bit as well so that may be 18,000 people that could be headed here to galveston this may be the only place that they can go and we're supposed to get walloped with the storm tomorrow again, guys, mandatory evacuation for dickinson, texas. this is interesting from a lot of perspectives and we talk about the refinery story and 50% of u.s. refinery capacity is shut down. dickinson, texas, neighbors texas city texasity is where there are four big refineries, three oil, one chemical north of that are a couple more refineries a lot of the women and men who work in these refineries no doubt live in the dickinson area, so the refiners story, 15% offline. we get that. there's no ships in the harbor there would be ships here normally they need supplies to run the refineries but they also need people if you don't have people it doesn't matter what the
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condition of the refinery is, guys, and based on the roads we've driven around and we've showed you and now the evacuation orders. even if these refineries believe they can open up it's not clear how long it will take to get the people back. if your house is submerge had had or your family is at risk and your boss says come back to work, i would imagine you would say sorry, boss, family first. i talked to the folks at shell they have a deer park facility that they split with pemex they say there's no timetable on when they will ask workers to return in hurricane ike some of them were closed for weeks or even a mount. that will draw down the 23 days of gas line inventory that the united states currently has so i'll leave you with that dickinson, texas, 18,000 people, mandatory evacuation we may not be able to rescue anyone who stays that's what it says. >> brian, let's stick on the evacuation order as opposed to the refinery story.
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>> reporter: sure. >> is there a sense of anger on the ground across areas areas in texas that we didn't have clearer evacuations before all of this, particularly in houston? >> reporter: no, and that's the battle right now i mean, the mayor is saying one thing, the governor is saying another thing, and it's really interesting. i mean, what the mayor has said, and i've heard interviews that he's done and seen press conferences where he's not going to order the evacuation of 2 million plus houston has 6 million people, the fastest growing metropolitan area in the united states and the mayor made the point that if he ordered the mandatory evacuation, where are they going to go. >> reporter: we've not been all over, but i can tell you this much where we have been, pretty much everywhere from just south of houston, we were in bay town which is slightly northwest of houston -- northeast of houston today to here. you're driving along, and there's a car in ten feet of water or a gas station under water.
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i showed those pictures earlier. i don't know where the people would go that's the problem the roads are getting blocked and if we're getting more rain like they say we're going to get and i hope we don't. it's not colleagues, sara, where all those people would go anywhere that's the problem the airports are close asked, and a lot of the roads are closed >> yeah. good point nobody expected the rainfall to be this relentless i think and to last this long. still not peaking. >> reporter: what did i hear -- >> we'll see you the next hour >> i was going to say houston airport got 16 inches of rain. the previous record was 8 inches, think about it doubled it. >> brian, outstanding stuff. thank you very much. brian sullivan for us in texas let's talk more about the impact on gasoline and also the refineries joining us now is anthony grisanti and on the phone neal dingman from suntrust, robinson and humphrey the in terms of how big an
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impact this has on whether it's wti prices or gasoline prices are, is the key thing how long the water now remains stopping workers getting back into those refineries >> well, that's absolutely try i mean, for the people this is devastating, and it will continue for a lot of days for the refineries though, i watched the futures market sell off on the close today gasoline actually lost about three cents. the gas graph came in about $1 towards the end of the day and the spread came in, the sep/och spread came in as a relief on thursday we transition from the summer gasoline contract to the winter gasoline contract which means we'll save 15 cents a gallon right there, and that's how much gasoline prices have rallied at this point. we saw a 1.78 print in spot month gasoline early last night or when the market first opened. i don't think we're actually going to get there again
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i think we'll stay below that. the october contract is trading about 1:57 right now and as i said friday we transition to that contract, so the -- there might be a little bit of relief coming down, but i think it's still too early to tell because there's been so much flooding in the refinery areas. >> neal, what's the update how much refining capacity is actually offline at this point hand how big of a deal is that going to be for gas prices >> you know, it's going to be -- >> we're looking at -- >> go ahead. >> that was to neal. go ahead, neal. >> i would say it's about 3 million barrels of the right now it's 25% of the gulf and in growing because you have not only in the gulf of mexico but along had the entire coastline, so right now i look at not only, you know, again, as anthony was saying, not only on the gasoline prize, but on oil prices i mean, why are oil prices bearish today is because you actually have the refinery of
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about 1.7 million now climbing up to 3 million barrels so that reduces total demand for oil of about 2.1 million barrels which more than outweighs the shut-in production of the gulf and a little bit we've seen in the eagleford so far of about call it 1.5 million barrels so the key to watch for oil prices then is going to be how much of the reduction of supply which certainly is bullish, but how much is this outweighed by the reduction of demand which right now that's what's certainly outweighing it causing oil prices to be down by 3% or more today. >> neal, talk to us about the companies that are most affected, and why do we see divergence in performance, the likes of chevron down today and marathon up? >> reporter: yes what we're seeing is really like ike you have certainly a lot of the refiners and producers in the gulf of mexico to your point that has a lot of facilities in the area like chevron that are shutting down. those areas once they have to shut down production are certainly going to be impacted
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and so, again, that is about over 20% of u.s. production is coming from the gulf and now they have already shut down over 25% of this entire production. that's been shut down, but what's different than 2008 is you now have about 15% of the u.s. production coming from the eagleford shell around the san antonio area, and the commission mentioned this morning they have almost shut down almost half a million barrels a day of that so that, too, i haven't heard too much your guests talk about that we hear a lot about the gulf coast and the gulf coast operators, but there's a ton of operators in the eagleford shell along the san antonio area that depending it on how much more rain we get in this area will really be impacted again, it's almost as much as they produce in the gulf they produce in eagleford. >> good point. the first time that we've seen a storm straight the heart of our energy infrastructure since the u.s. has been so energy dependant and such a strong
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producer anthony, talk to me about levels wti closing below 47 brent co-and others higher on the international demand i guess for oil prices which levels are you going to be watching here? >> yeah, certainly doesn't stop there. that's actually a good point about the oil demand i read some refiners are actually at reduced rates because they can't get crude oil into the refiners. they are actually running are out of supply, but i'm looking at the $45 level for wti if we break that, we could probably go to 22, but i don't expect it. once the refineries start to come back up, whether friday or the beginning of next woke you'll see demand for crude oil pick up, and that should support prices. >> quickly, we've seen another day where copper has gone up 2% and that trend of seeing the industrial metals go up and oil flat or down over the summer continues today. clearly the hurricane impacting the oil price. does that mean there could be a bigger snap back in the oil price when that goes away because that trend continues,
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the gap between the industrial and metal prices over the summer continues. >> if this happened, say, in the midst of the driving season i would say yes but now we're starting to run down and we're running into refinery a minute men where they turn around for winter will be a snapback but not as much as you think. copper up because of the down dollar, and there's also a lot of repairs, infrastructure, housing, things like that. they are going to need copper. >> anthony, thank you very much. also neal, thank you very much. >> thank you >> we've got an update now on harvey's impact on united airlines phil lebeau has more details phil, this is one you highlighted as being heavily affected >> right unit's hub is in hues top, one of its hubs is in houston and because houston international is shut down. it's not just people who are flying to houston but allots in
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that area. they will be offering travel waivers for 15 pirpts, as far west as san antonio and far east as shreveport and new orleans and that's because so many people will fly into houston international and then catch a reason nal jet to one of these other airports if you can't get into houston international, you won't make it to your final destination and that's why united is pushing these travel waivers or offering these travel waivers for these 15 airports for travel through september 5th. guys, back to you. >> yeah. doing what they can can, i guess. phil, thank you. >> you bet. less than 45 minutes to go here before "closing bell," and we've seen the dow and the s&p in pretty tight ranges all day long the dow down 26 points, but you're seeing a impact from the storm. home depot is leading for instance, travelers the big insurance company is lagging in the dow. the nasdaq remains positive has been a bright spot all session long. devastating flooding in houston has put a focus on the federal government's ability to offer aid through fema we've got the latest on fema's
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financials which are somewhat of a question mark next. >> indeed. and price gouging is a rising concern as supplies fall short in coastal texas up ahead we'll talk to the texas attorney general ken paxon about that situation we're back in a couple of minutes here on "closing bell. we, the people, are tired of being surprised with extra monthly fees. we want hd. and every box and dvr. all included. because we don't like surprises. yeah. like changing up the celebrity at the end to someone more handsome. and talented.
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the governor of texas gust saying that 18 counties in texas have been granted federal disaster declaration which actually triggers the involvement of fema and gets the money flowing to those counties. ylan mui has more on the financials of the federal emergency management agency. ylan, what can you tell us >> fema's budget for feeling with these major disasters is
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$6.7 billion this fiscal year and as of friday morning, before harvey hit texas, the agency had 1.8 billion left in its special disaster fund. a gop aide tells me right now that should be enough to cover fema's response to the hurricane and so far there has not been a new request from the white house for more money, but assuming that there is a deal on capitol hill on a spending bill, that disaster fund will get refilled once the new fiscal year begins. there's also a lot of murmuring in washington about the potential of a broad aid package for victims of harvey including more money for fema, maybe reauthorizings the national flood insurance program which is supposed to expire on september 30th, but it appears unlikely that lawmakers will be able to pull together an aid bill as soon as next week when they return to washington from recess today house democratic leader nancy pelosi put out this statement. american families deserve to know that their government will
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be there for them when disaster strikes, without question and without hesitation so, guys, perhaps there is room for democrats and republicans to work together on this package. back over to you. >> ylan, thanks very much for that h.continuing this discussion we're joined by james lee whitt, former director of fema under president bill clinton. james, thanks so much for joining us first of all, your take on howie is veer this current crisis is relevant to past issues like katrina. >> well, it's very relevant. you know, it's a catastrophic event. there's no doubt about that, and it's going to take a lot of efforts to help rebuild and have to get through this rescue phase first and then when the water goes down because it's time to start looking at planning the long-term recovery program, so, you know, i just heard had a
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fema h fema had 1 billion plus and then congress will have to do a supplemental appropriations to help get into the recovery could be several more billion dollars. >> in the past, you know fema has been no stranger to criticism around hurricane katrina. how do you judge whether fema is doing a good job as they take the lead here, coordinating all federal and local agencies in their rescue and response? >> well, i know administrator brock long he's a very experienced emergency management director from alabama he's dealt with 14 disasters in alabama himself, and he knows how to do it he knows how it works, and i think his leadership will help fema and the fema employees to work together in a way that's going to make a difference in this response. >> what do you think of the president's thus far haven't had an outright statement, but it seems he has
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got behind the requests of fema and got his cabinet united to offer all help that's requested of them by fema. >> you know, he signed the declaration on friday. i think that was a wise thing to do and should have done. i think going to texas tomorrow is a good thing. the people need to know that the federal government will be there as long as it takes to recover and build. eight years i was with president clinton. you know, he always went to the major events and always reassured people that we were going to be there to help them get through it, and we were and we did, and i think president trump is doing the right thing i would like to suggest that he might visit a shelter if he had time to visit with victims i think that would add a lot of hope to them that are in some of those shelters, and just to tell them that, you know, hejust to
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tell them he's there for them. the that would make a big difference. >> since you've been there before, jim. can you take us inside the fema headquarters, what the room looks like right now and what it looks like in terms of emergency response and what they are dealing with. >> when i got there there wasn't an operations center and just telephone wires hanging out of ceiling. we adopted a national incident system and we rewrote the federal response plan which is the blueprint for all the federal agencies working together in their own specific role, and we created the esf functions which is emergency support functions and all the states adopted those as well so everything was in sync, and it worked extremely well. the fema headquarters right now, the tasks that they are getting from the state of texas and those local communities and the resources that they may need that they cannot fill, it's important at fema headquarter and in conjunction with the
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operations center in texas that these resources are put together and put in place as quick as possible the pre-positioning of those resources helped a lot. >> that's the hope for how resources are deployed going forward to minimize the fallout of this issue. what about looking backward. in your opinion were mistakes made in terms of failing to evacuate certain areas in advance of the storm hiting? >> well, you know, that's a call of local government and, you know, usually -- usually after the response is over with and after you get settled back down, you know, they do an after action report and point out what deficiencies they have and what they should have done different, and those are lessons learned, and you try to take those lessons learned and improve your emergency management plans and evacuation plans and -- and all aspects of the event >> james, thank you very much for joining us james lee witt.
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>> we've got about 34 minutes to go before the close, and markets are slightly lower for the dow and s&p, nasdaq fractionally higher and financials are down and health care at the top in light of the gilad deal. expedia stock traveling downwards and uber is likely to blame. we'll explain why next. >> plus, $99 for a case of bottled water. that's what one texas gas station was reportedly charging. texas attorney general ken paxton joins us to talk about how he's combating that price gouging that's going on in wel rhtxa 'lbeig back. hi, i'm mindy kearns. it's great to finally meet you. nice to meet you too. your parents have been talking about you for years. sorry about that. they're all about me saving for a house, or starting a college fund for my son. actually, i want to know what you're thinking. have a seat. knowing that the most important goals are yours. multiplied by 14,000 financial advisors, it's a big deal. and it's how edward jones makes sense of investing.
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welcome back to "closing bell." here's a check on some of the other big stories we're following for you today. apple reportedly going to hold its next product launch on september 12 the tech giant is expected to unveil three new phones. the tenth anniversary iphone and two updates to the iphone 7 models that stock is higher today meanwhile, shares of expedia dropping today on news its ceo has been asked to lead uber and fill the spot vacated by travis kalanick expedia's chairman diller says nothing has been finalized at the moment, and finally amazon's acquisition of whole foods closing today. shoppers already seeing discounts on produce and some other fresh foods. whole foods displaying amazon echo and dot devices on sale as part of its farm fresh branding. watching many so of the grocers. they have been hit
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a one-two punch, first on the news of the deal and then on news of the price cuts. >> and i love that they are throwing out echo in whole foods stores so, of course, the cross-pollination the other way but it will help them sell that product as well potentially. massive discounts. 44.19 for the entry price and hoping that voice activation is something that food is ordered. >> whole foods had a whole paycheck type of image so this could be a big press release type of announcement to bring people in and get their shoppers reacquainted after the amazon deal it's the prime partnership that i think is most potentially scary for the industry and other grocers that are struggling themselves to move over into e-commerce and online grocer whole foods has only 400 locations in the u.s walmart and kroger are much, much bigger. >> want to come back to the apple thing as well because after the last set of guidance people were quite surprised at how positive their number was for q-3. we're starting to see why. if they can get the iphone 1 into the back month of q3 it
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will feed into the numbers questions of whether they had enough components and supply to meet early demand by setting the early release day. that's positive for the stock. up today, not quite 1% but doing okay off the back of it. >> bringing its year-to-date gains back to 0%. >> interested to see if this does include a new apple tv announcement which a lot of people are wondering a lot of advancements in that area and apple tv is seen as lacking compared to some of their other products which are clearly normally at the top of the list. >> it's all about rumors and speculation at this point. apple holds its cards close to the vest. >> still up a percent. let's go over to sue herera were more on hurricane harvey from the storm desk sue? >> reporter: thanks so much, guys here's what's happening at this point. contributions for the victims of the storm continue to pour in from major companies across the nation apple pledging $2 million and pepsico and walmart 1 million in cash and product donations and google 500,000
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one local kentucky company is stepping up as well, a division of landy's catering is sending much-needed supplies to houston including huge sleep trailers and dozens of generators all of this as officials with emergency disaster services head to the area. >> as things, you know, power gets restored and a lot of the chaos, you know, is gone and, you know, the normal stuff is coming back up, then we'll use these and leave them out here to help families and things that have nature. >> reporter: former president and mrs. george h.w. burish ewing a statement to all houstonians and texans affected by the storm saying barbara and i are in maine but our hearts are in houston. the bushes have a home in houston but they spend their summers up in maine. that's the cnbc update on hurricane harvey i'll send it back to you, sara. >> sue, thank you.
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we'll continue to check in with you. a little less than half an hour before the "closing bell." a quick check of the broader averages nasdaq stays positive thanks in part to biotech and technology russell 2,000 going strong dow is down 20 and s&p 500 is almost change, almost bang on flat as wil likes to say more than 1,700 miles away from the houston coast, hundreds are already moving on insurance claims next to hartford, connecticut for a look at the impact. >> first, we'll talk to texas attorney general ken paxton about his fight to protection consumers in the hurricane's aftermath and what the state needs to do to rebuild its battered coast "closing bell" is back in a couple of minute you always pay
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to tap into for harvey it's affecting houston and lake charles all the way to mississippi. hooer's what we're watching going through the next couple of days this is thursday, one additional thought we'll be tracking. parts of it already seeing over 30 inches of rain, and we have 20 more forecasts on the ray 50 inches of rain, catastrophic and even less than that. we've been seeing catastrophic for much of the area want to show you a couple of statistics been crunching a couple of numbers so over saturday and sunday we had nearly 25 inches of rain. 26 inches of rain. look how many nrg stadiums that could fill with water. 382,384, and roughly 2 million people live in houston that would give you five years of drinking water for harris county now, as we look ahead to the next couple of days. of course, more rain in the forecast i want to show you a couple of things you'll notice highest rainfall totals so far. that comes from dayton, texas. we're talking nearly 40 inches
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of rain. you shaw what i showed you earlier and, of course, this next statistic we're talking 10 inches to 20 inches of rain possible over the next couple of days. very serious and dire situation. one of the biggest problems is going to be that buffalo bayou we're talking about more than six feet over what the record had already been that we hit on sunday 73 feet from that, of course, as it moves through from west to east into trinity bay, so a situation that continues to unfold and we continue to track that rain. they are definitely going to need to be watching those areas over the next couple of days as far as the flooding concern goes guys, back to you. >> angie, thank you very much. as harvey continues to wreak havoc in the houston area, the texas attorney general is warning texans to look out for illegal price gouging and scams, and it's not just spiking gags prices, but warnings of spiking necessities such as bottled
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water. >> joining us to discuss that is texas attorney general ken paxton who is in austin, texas, monitoring the fallout thanks for joining us. >> thanks for having me on appreciate it. >> talk to me about some of the reports you're hearing from the houston area about price gouging. how widespread is this. >> as of the end of the day yesterday, we had over 500 complaints those come in through e-mail and come in through our hotline, and so we've been pursuing those, and you -- you mentioned some of those as water being, you know, jacked up to $99 for a case of water. we've had hotels triple and quadruple in price and fuel that's been up to $4 to $10 a gallon so these are things you can't do in texas. i don't think a lot of people know that, but there are significant penalties if you price gouge in a crisis like this >> attorney general, i mean, clearly all of us would be agreed that it's a moral issue to try and oversell necessities
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at a time of crisis. is it and should it be a legal issue as well? certainly it's up to the seller to sell the product at the price they wish, even if morally clearly at this they shouldn't be overcharging for necessities. >> clearly the texas legislature thought differently because they are the ones that put the penalties in place up to $20,000 per occurrence, and if you do this to somebody 65 or elder it's up to $250,000 for occurrence so our legislature and signed by the governor many years ago clearly didn't want during natural disasters necessities to be jacked up in price that. what is a decision that they have made and we're enforcing it. >> i guess on the flip side, do you worry at all about shortages of various goods to be exacerbated by this sort of making -- by making it illegal to price gouge, it might be hard for businesses to actually get the supply they need and more expensive to do so, and without incentive of being able to raise prices maybe impossible? >> well, you know, i talked to a
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lot of retailers about this, some of the big retailers, and they are in the process right now have re-establishing supply chains as quickly as they can. they have plans for it when the waters recede. as large as our country is, as large has texas is, that supply is ultimately going to be that big of an issue. my job is to enforce the laws that the texas legislature put in place, and we're going to do that. >> attorney general ken paxton, thanks very much for joining us. >> wish you all the best. >> keep us in your players, please. >> we will, we will. thank you very much. from austin, that is joe paxton. with a little less than 20 minutes to go before the closing bell, dow down 16 points, so a minor selloff coming after actually an up week for stocks all three of the major averages closing higher h.nasdaq stays strong up a quarter percent and the russell 2000 index of small caps up a third of a percent.
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>> millions of dollars in personal property losses will be part of the harvey aftermah. up next, we'll go live to the travelers insurance command post where work already sdauny way on claims "closing bell" back in a couple of minutes where work already sunday way on
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welcome back hurricane harvey dragging down insurers today and travelers is powering up its catastrophe management center to assess the damage and that's where we find our morgan brennan morgan. >> reporter: hey, wil. travelers is assessing harvey right now from here in windsor, connecticut, at its national catastrophe center, and it also has resources on standby for the golf region. it's not just homes or businesses that adjustors are going to be assessing. several analysts expect the auto losses to be much greater than we typically see for a hurricane because the flooding has been so extensive and also because new cars are just more high tech the acceptsors are much more vulnerable to water damage that's something to watch with progressive, all start, berkshire hathaway and travelers as well which actually trains a lot of its adjusters on vehicle damage in this very room here in winder, but that's just one piece of the property puzzle since this is largely a flooding
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event, it is a complicated picture, and that's one reason so many of the early estimates on losses have been so varying depending on the sources, so here's how to think about this the federal government is going to be on the hook for residential flood insurance, but wind damage to homes is going to be the insurers. also commercial, on the commercial side. any kind of flood insurance on the commercial side. many insurers offer that coverage to their commercial client, so that's going to potentially impact companies like hartford, chub, nationwide, travelers which have some of the largest market share in texas according to wells fargo, but there is a bit of a bright spot in all of this, and that's the fact that the insurance industry is very highly capitalized right now. $709 billion in surplus for the industry as of the end of the first quarter. what that means is if the insured losses do rack up into the tens of billions of dollars, which would make this one of the most costliest hurricanes in
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u.s. history, are put it in the company of katrina, superstorm sandy or andrew, the insurance industry will still be able to absorb those losses and do so without, according to analysts, taking a big chunk out of future earnings guys, there's still a lot of unknowns the storm is still under way, and the estimates are all over the map which is why you're seeing the insurance stocks trade lower today. back over to you. >> morgan, quick question, and i know you're following the company impact of all of this. we hear there's an unusual number of inunshird in the region something we saw with hurricane katrina as well. any sense of the size and scope of that have and what happens to those people >> reporter: yeah. so this is an issue, as you mentioned, we saw with katrina we've seen it with a lot of hurricanes in the past it's particularly true when it comes to flood insurance for homeowners so just to give you a sense here according to the most recent fema data, in harris county
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which is the county which includes houston, less than 15% of the housing units in that county have active flood insurance policies in place right now so folks that were flooded out. they are going to come home and realize maybe their typical homeowners insurance doesn't cover the flood damage, and they don't have those policies and that's where you're going to see a lot of devastation on an economic front. >> and i would assume that becomes the federal government's responsibility and just increases the size of that cost. >> yes >> what's the other swing factor as well in terms of some analysts suggesting that auto insurance could be something that leads to the estimates and the costs for insurance companies being higher because that doesn't have the same protection against flooding that -- that some home insurance does. >> yeah, so on the homeowner side. >> you know what, morgan we have to cut you off because we'll take to you listen to the
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president who is welcoming the finnish president and making comments hon harvey. >> things are being handled really well. the spirit is incredible of the people the coordination between all of the different services, as you know, has been going very well great respect for the governor he's done an incredible job and i look forward to the trip so i'll be going there tomorrow we're leaving at about 8:30 in the morning. we don't know exactly which sections we'll be notifying you soon, but we'll be traveling throughout certain parts, and we may actually go back on saturday, depending on where the storm goes, we may also go to louisiana on saturday. >> are you surprised at the magnitude? >> the biggest ever. they are saying it's the biggest, it's historic it's like -- really like texas if you think about it, but it is a historic amount of water in particular there's never been anything like it, so the people are handling it amazingly well and the people of texas, as you know, have
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really persevered, and when you watch the spirit and the enthusiasm and helping each other, the themework, it's really been something for people to see i think even in finland that's been pretty reincredible what they have to do. >> we have noticed that, yes it's wonderful. >> we'll be leaving tomorrow at about 8:30 in the morning. >> will you have cabinet meetings >> we've done quite a few cabinet meetings to make sure everything is coordinated. we've been dealing with members of congress. it's going to be a investigation pensive situation. we want to take care of the people of texas and louisiana. the flow seems to be heading towards louisiana as we speak and we'll helping the people of louisiana also you'll see us tomorrow and see both of us in a couple of minutes in the east room thank you all very much. >> that was the president speaking just moments ago. he commended the work of the governor of texas, also the
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perseverance of the people of texas. he described it as a historic flooding, never seen anything like it, never seen levels of water like it before and, of course, he was sitting there next to the president of finland, and they will be holding a joint live press conference which we'll have for you live. >> praising texans for handling the storm and he's considering a second trip. the president is expected to go to -- confirm that he's going to texas tomorrow. >> at 8:30 a.m. >> around the corpus christi area. >> and may go saturday back to either texas or louisiana. also warning that the storm is heading and the rainfall is heading towards that part of the country. >> we've got about 7:30 to go before the bell. markets sort of mixed to down today, as you can see, fractionally down for the dow, about 17 points after last week we saw half a percentage gain. >> there was a big pharma deal by gilead to fuel growth in the
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investors are continuing to process the damage and destruction of hurricane harvey. just want to show you the major averages groups like insurance companies and energy companies are among the hardest hit had. you do have bright spots in the snegs like in healthcare
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welcome back to the "closing bell." just a minute or two left until the bell goes. we're flat at the end. dow down 11.5 points a couple of standout winners, home depot seen as a potential beneficiary to, of course, hurricane harvey and apple up on an announcement on release date of its new product on the iphone 8. insu insurers like travelers down and dom, the main take heir weighs >> what do you sell the home depot, flooring, mohawk rallying
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today as well and construction in big engineering companies power utility type stuff, lot of stuff to replace, power lines to fix, that sort of thing. watch those companies. they are big beneficiaries as well. >> dom chu, thanks so much for that oil prices we should say as well looking at gasoline for most of the day. wti ending down pretty soft, down a couple percent. the first hour of "closing bell" is down and the second hour kicks off now. >> thanks, wilfred i'm sara eisen in for kell deevans. here's how we're finishing up the day. major averages little change masking some of the bigger moves beneath the surface, financials, fringes, down half a percent so are energy companies and healthcare up a little more than that the nasdaq did close the high, up one-third of 1%
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technology all day was strong. biotech in particular off the back of that guile yald deal the russell 2000 index of small caps closing up a third of a percent. hurricane harvey coverage continues this hour, and we'll have the latest for you from the hardest hit areas, houston, galveston and corpus christi we've got reporters in all places also, the president is expected to address the hurricane's devastation in a news conference this hour. he eat meeting with the president of finland, and we'll bring it to you as soon as it begins but joining today's panel for the hour, of course, cnbc's senior markets ghen stator mike santoli. i mentioned earlier that energy and insurance stocks seemed to be bear the brunt of the devastation that continues in texas. >> the damage was pretty localized in those areas directly up against some of the issues in south texas. i do think the energy trade is one that people think is going to be, you know, due to the
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outages, a temporary kind of bottleneck there, and then, you know, insurance drag them down banks, too, treasury yields dipped lower you had a subdued trade. the dollar was weakened. the stock market is holding its own here, generally chopping around, but in general it was a slowdown male to the market. and road stocks working, energy and healthcare. >> on the energy trade, saw it play out, up on gasoline and the fall in wti down 2.5%. >> in fact, that spread between wti and brent was pretty right here. >> it looks like they are saying thd much more to come over the next hour. >> we've been monitoring
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higher's devastation throughout the day. contessa brewer is in houston with the impact so far and jackie deangelis in corpus christi where the eye of the storm hit this weekend contessa, let's start with you. >> reporter: wehave just learned that the lone star series, the rivalry games between the houston astros and the texas rangers that was scheduled to take place here at minute maid park in downtown houston will now no longer take place even in texas. the games are being moved to florida. clearly the flooding is on the minds of everyone. the houston players are tweeting out their concern for their fans and their friends and their families here, but imagine the business impact now, not only of harvey but typically relying on an intense rivalry between these two texas teams to bring out business and bring people down from dallas, and now these bars are not only shut down over the weekend and on this monday, but they are looking forward to now seeing their business decimated through the week we're seeing r.there's bars and restaurants all around here
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which now it's a ghost up to it, and likely to remain that way as the rain just keeps coming down. and yet i talked to one businessman here in houston who was dropping off donations at the convention center and he said, look, my employees can't get in there's nothing more important than taking care of the people first and then talking business late her, and seeing is the business community rallying around each other, pumping out water and trying to try out and making sure they can get back to work when the time is right to do that. >> we've followed you today from the convention center where hundreds if not thousands of people are setting up temporary shelter. how are you making your way around the city? >> reporter: i'll tell you what the most difficult part was getting not city could begin with we decided to -- we were using our maps on our phones to see
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where the roads were flooded and there's great websites for that but they are not totally up to date you drive up to run place and see it flooded and have to loop way back around to get in and now some of the streets that have been flooded, intersections that had water up past the curbs, some of that has been receding are somewhat. just a note though we don't know what to expect because the two reservoirs, the army carr of engineers says they are releasing capacity amount of water, as much as possible, from these two reservoirs to make sure that they don't breech or overtop and the businesses here don't know what to expect as the water makes its way through the boyious a bayous and neighborhoods. >> let's head over to corpus christi where residents are dig out. jackie deangelis with the details on the area devastation. jackie. >> reporter: as contessa said, taking care of the people seems to be a central three all the
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way from houston over here to corpus christi governor abbott just concluding his briefing, and that was part of his message >> there is a reality that we have to come to grips with, and that is we are just beginning the process of responding to this storm we are still involved in the search and rescue process. >> reporter: so, of course, governor abbott mentioned the fact that this search and rescue position eds is going to cake place and he also pleaded for people epatience because this is a difficult time whether you're underwater and waiting for to be a to be restored 40 minutes from here is where
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the governor andsenator cornyn are headed now to take a look at the damage we were able to see yesterday. that's a town population 10,000 that saw absolute devastation. we saw with our own eyes you could see blocks hand blocks of homes and businesses completely torn apart, roofs blown off. people telling us really that they had nothing left after this storm passed through there is going to be a period of rebuilding here, infrastructure, getting power back resort and making sure that the sewer systems work properly. that's going to take a long time you know, just anecdotally as we were driving around i turned to my producer and said how do you come back from this? how does this town ever look normal again, and we asked the same question to many people who said we're texans. we're strong we're going to come back from this back to you. >> and jackie, that's the type of perseverance that president trump, of course, commended in the comments we heard from him moments ago hemp's due to give a
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live press conference coming up which we'll listen to live he also commended the governor who you just brought a clip from of people in the state happy with the governor and the president in terms of the response so far? >> look, here's what i'll say. from are the smokes that we've spoken to. so far everybody is saying that this has all been handled the right way. we're only a few days into the catastrophe. when youstart having towns tha don't have power for two or three weeks, people will get impatient no matter how positive they are right now the message right now is everything has been handled, but sometimes when you look back in hindsight there could be some criticism. >> yeah, as always jackie, thank you very much. live in corpus christi which has hopefully seen the worst of the weather. as harvey leaves record flooding in its path, what does that mean for oil production and houston in its surrounding areas
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joining us now is andy hendricks, it's a -- thanks for joining us by phone. i know you have more than 100 drilling rigs in this country. give us a sense of how much them are being affected or shut down by this storm. >> good afternoon, sara. thanks for having me on. our thoughts and prayers go out to everyone affected by this hurricane and the flooding that's followed and for patterson uti, safety of our employees and you've heard this theme in the commentary today. it's the safety of our employees that we're focused on across south texas and in houston i'm happy to say that all of our employees are accounted for at this time. >> what's your view at the moment in terms of how likely, how quickly we're going to see rigs come back on -- refiners come back on and see action there, hand what are the main swing factors that could affect in a >> the refineries are right
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along the gulf coast and that's problematic with the weather systems that we've had in terms of production and drilling and what we do, we operate 159 rigs across the u.s. only 21 of these are in south texas, and we're really in the path of the storm. we're already starting to reactivate some of the drilling rigs and some of the completion crews today and tomorrow to go back to work if you actually look at the wet we are around san antonio. >> wow. >> these oil fields are between san antonio and the coast, san antonio, piersall, texas, already seeing sunshine hand partly cloudy weather where it's clearing up already. you know, we're still getting a lot of rain along the coast and you'll still have challenges with the refineries. >> so if you're bringing production back and presumably other companies are as well, and the refiners remain offline, what does that mean in terms of crude kind of building up in the system. >> well, that's a good question. you've got a balance equation. got the gulf of mexico offshore with 25% shut in and depends on
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how much refining capacity is offline as well. you're not completely impacting -- we have 49 rigs operating in west texas. >> there think be many -- it will be a while before they get the offshore production back online. >> the fact that the u.s. has become such a major energy producer, both oil and gas in recent years, how has that changed the dynamic of what we're seeing as this hurricane strikes the capital of the u.s. energy base? >> well, i think it's greatly changed the dynamic. in terms of production and where we produce oil and gas we're much more diverse than we were ten years ago. ten years ago we were highly concentrated to offshore gulf of mexico and these storms caused significant shutdowns. now, we have much more production out of west texas, south texas and north dock and
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producing more natural gas out of marcellus and uticas in the northeast. so you have more balance across the country. >> okay. thanks very much for joining us, andy hendricks, ceo of patterson uti energy. >> thanks for having me on. thousands it of flights have been cancelled and more may be on the way both houston airports are closed until further notice due to flooding from hurricane harvey coming up contingency plans for those traveling to houston and a look at the impact that harvey has had on the fourth largest city, e tythci of houston, the fourth largest economy there we'll be right back.
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welcome back to "closing bell." we're just minutes away from a live "news conference" with president trump and the president of finland we'll bring you that as soon as it begins. of course, we just had comments from president trump moments ago. >> where he said he -- he's going to visit tomorrow, texas, and might actually go a second time on saturday to either texas or louisiana >> the worst of hurricane harvey may be over, but the texas coast will continue to get rain. we know until at least thursday. the insurers lowered today on news still too early to make accurate
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estimates of the damage to homes and businesses, and an insurance research group is predicting this storm's damage to equal that of hurricane katrina which was the costliest natural disaster in u.s. history. >> how will the damage be assessed let's bring in a partner at kosowicz, benson and torres. thanks so much for joining us this afternoon we've heard the estimates in terms of total cost to the economy could be upwards of 50 billion. the katrina damage is that what you expect, and where does that cost fall on private insurance or other areas? >> well, good afternoon, and thank you for having me here today and i do want to start by saying my prayers go out to the families and individuals affected by this in. terrible event with respect to insurance, you know, with each of these events with super storm sandy and hurricane katrina and the other natural disasters that we've seen in the past few years, insurance has been a very important resource for
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businesses and individuals in responding to this claim, to this event so we would expect that private insurance will be a significant resource here. you know, we're dealing with flood issues and questions of flood exclusions, flood insurance and how the flood here will be addressed under insurance policies, but we would expect in large part that private insurance will be very important for responding to this event. >> the that contrasts to what i've heard other analysts say today that because some of of this is flood impact that that might exclude private insurance companies from having to pay the bill >> you know, there is a misnomer out there with respect to whether flood insurance exists there's no question that in certain areas of the country that are susceptible to hurricanes and these types of
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events, flood insurance can be very expensive and in many instances homeowners make decisions not to purchase it, but there are at least 15% i believe of homeowner insurance policies in the houston area with flood insurance, but if we're talking about business-specific insurance policies, many of those policies do have flood coverage now the coverage can be significantly limited there. can be high deductibles and low policy limits that apply for flood, but, you know, insurance policies are interesting creatures, and you have to read them very carefully. in many policies that i've read, are you know, over the years i've been involved in handling insurance coverage disputes for these types of natural disasters, flood is a big dispute and how it's defined is important in deciding whether there's coverage and there's other options even if flood is significantly limed.
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there's other coverages in the policy where there may be significant resources available to pay for things like cleanup, debris removal and decontamination costs. other things that are incurred in responding to this event that would not just be flood-specific damage so there is coverage >> you mentioneded there was an estimate of some 15% of homeowners in this area have carried flood coverage that doesn't seem necessarily like a high number given how far inland the flooding effects have been and certainly a lot of homeowners who didn't have a need or didn't perceive a need to buy it and the estimates keep rack up of uninsured losses. while that's not really the domain of the private insurance companies to worry about, i do wonder what it means for how fast money can get back into these areas as the rebuild process gets under way. >> that's an excellent question and you're looking at it the from two perspectives, right
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it's the individuals and businesses and home owners, and a number of homeowners are going to be dealing with a difficult situation to the extent they don't have the flood insurance that's why it's going to be so important. as soon as things start to normalize and people are able to get access to their insurance policies, speak with their insurance brokers and understand what insurance protection actually exists within the policies that they have, there mayin, as i said, if flood specifically is excluded there may be other alternatives to coverage within those policies so it's very important to see what the language and the policy actually says when you've got specific flood exclusions, but this is going to be a difficult situation where alternative resources may be necessary in addition to the actual insurance policies that were purchased by homeowners to respond to other types of events that they thought they were more at risk to address
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>> we're just going to thank you here because we have to go to president trump who just began his news conference. >> it's my great honor to welcome the president to the white house. we've just concluded a very positive meeting, and i want to today by extending my thoughts and prayers for those affected by hurricane harvey and the catastrophe of flooding and all of the other difficulties that they are currently going through in houston, in southeast texas and now it's looking more and more like the state of louisiana will also be affected. my administration is coordinating closely with state and local authorities. in texas and louisiana to save lives that we thank our first responders and all of those involved in their efforts. we're working directly with texas governor greg abbott, by
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the way, who is doing a fantastic job, and his entire staff likewise as well as with governor john bell edwards who is very much involved in starting the process of louisiana. we've pledged our full support as texas and louisiana battle and recover from this very devastating and historic storm there's probably never been anything like this under the supervision of fema, administrator brock long, there has been a tremendous amount of work done. he has -- he has been so outstanding in so many ways. more than 8,500 federal workers are involved in the texas effort hey lone i've also today declared emergencies in louisiana at the request of governor edwards.
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recovery will be a long and difficult road, and the federal government stands ready, willing and able to support that effort. right now the single most important thing is the safety and security of those still in harm's way, including the first responders who have been so terrific and brave protecting the lives of our people is my highest priority. every asset at my command is at the disposal of local officials. tragic times such as these bring out the best in america's character, strength, charity and resilience which are those characters we see neighbor helping neighbor, friend helping friend and stranger helping stranger. you see that all over. you watch it on television, you just see such incredible work and love and teamwork.
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we're one american family. we hurt together we struggle together and believe me we endure together. we are one family. to the people of texas and louisiana, we are 100% with you. we're praying for you. we're working closely with your leaders and officials, and i will be advice irrelevanting the impact zone tomorrow to ensure that you're receiving full support and cooperation from the federal government, and on saturday we think we're going back to texas and also we will be going to louisiana. nothing can defeat the unbreakable spirit of the people of texas and louisiana right now every american heart sends its love and support to those whose lives have been upended, totally upended, totally, by this very horrible storm. we ask god for his wisdom and strength we will get through this we will come out stronger and
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believe me, we will be bigger, better, stronger than before the rebuilding will begin, and in the end it will be something very special and i just want to thank everybody in the affected area, because it has been absolutely incredible to watch, the spirit, the cooperation and the love i would also like to share had a message to the people of finland. who have recently suffered a terrorist attack we stand in solidarity with you against the terrorist threat we must all work together to deny terrorists safe havens, cut off their finances and defeat their very wicked ideology mr. president, americans are grateful for your steadfast support as an ally in the fight against terrorism. appreciate it, including your membership in the coalition to defeat isis.
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finland makes important contributions to the coalition and its effort in afghanistan and as troops on the ground in iraq training iraqi soldiers n.afghanistan finland provides troops and financial contributions to support the afghan national defense and security forces on a modern day frontier between barbarism and civilization that's what you have it's barbarism versus civilization we're particularly grateful to the finnish citizens who have sacrificed for our mutual security finland is a leading expert in cyber security in fact, we should be calling it pretty soon. you do do a fantastic job with cyber security, and i congratulate you, and -- and i think not a very short period of time we'll be right there with you, believe me. the united states is very proud
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partner of finland's european center of excellent to counter modern threats including cyber attacks. in addition, we look forward to your leadership as share of the arctic council the arctic region has strategic and economic importance for both of our nations, very much so the foundation of our friendship is our shared love of freedom. on behalf of all americans i congratulate you and the finnish people on the 100th anniversary of finland's independence. 100 years. fantastic. in honor of finland's centennial, the united states is couldn't bursting an additional half million dollars to the fullbright finland foundation. through the fullbright program we are sending more of our best and brightest to find land, forging lasting connections between americans and finns. on the economic front we seek
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fair and reciprocal trade to benefit both of our countries. i applaud finnish companies to their commitment to increased are investment in the united states, adding new technologies and adding good jobs for hard working americans. thank you. the u.s.-finnish partnership is rooted in our shared interests and common values. as president, and i must say and i want to thank you, president, we've discussed and we look forward to further strengthening these bonds of culture, commerce and cooperation between our two countries so that our citizens and our nations can thrive and prosper together mr. president, i would like to thank you very much for being at the white house, and we had a great meeting in the oval office it's my honor to have you here >> thank you very much mr. president, i want to thanks you for your very kind words and
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to -- and i just want to tell you that it is a great pleasure and honor to be here today i thank you also for the discussions that we have had they have been of most interest. >> thank you we have been closely following hurricane harvey our thoughts are with the people of texas and louisiana they and you, mr. president, have shown strength and courage to overcome this catastrophe it has been touching to watch the tv and see how people help each other that is what we basically are built of, helping each other finland highly appreciates our close relationship with the
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united states. today they are broader than ever, ranging from security to defense cooperation and trade and innovation we rin deed celebrating o100 years of independence p.i want to thank you for the general's gift presented to the fullbright finland foundation i want to also to take this opportunity to create the almost 700,000 americans who have finnish origin mr. president and i exchanged news on several international issues our broaheadline was security. we discussed the importance of the transatlantic bond between the european union and the united states. history has taught us europeans the value of unity the u.s. and nato presence in
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europe are and in baltic sea are most important, and they are increasing rapidly finland is doing its part. we promote dialogue. to reduce risks fibland has promoted steps to improve flight safety in the baltic sea area. they are small but positive steps in reopening dialogue between nato and russia. we remain committed to supporting afghanistan, and we are dedicated member of the coalition against isis finland took the chairmanship of the arctic council from the united states in may we can't afford losing the pristine arctic nature finland firmly believes that business and environment can
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both be winners in the arctic. a good example is reducing black carbon mr. president, i'm looking forward to even closer cooperation with you and your great nation i want to thank you. thank you. >> so we'll take a couple of questions. how about we go to texas todd gilman. todd >> thank you, mr. president. >> yes. >> i'm wondering what you can tell the people of texas in terms of long-term recovery efforts, and in particular you have been feuding can key congressional leaders and also threatened a government shutdown potentially next month over border wall funding. are these going to hamper long-term the -- the funding that will be needed long term for funding? >> no, todd. i think you'll see very rapid
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action from congress, certainly from the president, and you're going to get your funding. it's a terrible tragedy. your governor has been absolutely outstanding in the job he's done and his entire staff, and i will say that -- i just spoke with greg, and he is working like 24/7. we expect to have requests on our desk fairly soon, and we think that congress will feel very much the way i feel, in a very bipartisan way, that will be nice, but we think you're going to have what you need and it's going to go fast. texas is a unique place. it's a great, great state, great people, and i think you'll be up and running very, very quickly, really very quickly, so, yeah, i think you'll be in fantastic shape. i've already spoken to congress and everybody feels for you and feels for what you're going through, but at the same time they have great respect, even additional respect for the state because you've handled it so well, so brilliantly but it's a long road still pouring, still a lot of
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rain nobody has ever seen anything like it. i've heard the words epic. i've heard historic. that's what it is, but you will have what you want i think very, very quickly, and, todd, you can ask a president to the president. >> sure. thank you. does this situation make you reconsider the possibility of a government shutdown next --? >> i think it has nothing to do with it really this is separate this is going to go very, very quickly. i've spoken to many of the people we're talking about, and everybody feels the same way i do. >> thank and mr. president, i wanted to ask you. your neighbor russia has meddled in u.s. politics they have a military exercise coming up in the next few weeks in the baltic. there are tensions over there. what kind of advice have you offered and can you offer to the united states in dealing with this this ad versery?
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>> sir, we are not feeling ourselves as advisers, but we are feeling ourselves as doing all what is possible to maintain peace and that's what we're doing in the baltic sea area, too. with actually you referred to a different kind of military training which is going to happen there i have to tell you that a couple of weeks ago i melt president putin and their media interested in why chinese navy is having a training together with russians in baltic sea area putin answered that it is not a block. it's not against anybody my answer was that we are also training in baltic sea with united states and sweden, and it is not a block
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it's not against everybody, so we have to be very careful that this huge training, huge military trafficking over baltic doesn't cause any accidental problems because we know that from accidents might grow whatever, and that is why i think it's important that we continue to work with nato to enhance, like i said, dialogue between russia and nato, and it is going forward >> do you have a question? >> finnish broadcasting company, where you are, okay. >> thank you, mr. president. i have a question to president trump if i may as the president said he's been raising the issue about the security situation in the baltic region and the baltic sea specifically and has been concerned about the russian
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planes flying tlut without transponders on. so my question to you, mr. president, mr. trump, would you consider russia as a security threat? >> well, i consider many countries as a security threat, unfortunately, when you look halt what's going on in the world today. as you know, a few weeks ago our great vice president, mike pence, who is right here, was in the region and spend quite a bit of time there. we consider that a very, very important part of the world. we have great relationships there. we have a great relationship with finland, and so i would consider many countries threats, but these are all threats that we'll be able to handle if we have to. hopefully we won't have to handle them. >> can i have a follow-up as he had also so if the situation in the baltic were to escalate, what would the u.s. be ready to do in that unfortunate circumstance? >> well, we're very protective
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of that region, that's all i can say. we're very, very protective. we have great friends and great relationships there. we're extremely protective. >> thank you, sir. >> a question for the president. yes. >> do you have a question for the president? >> you don't have to >> mr. president, did you speak about climate change at all, and what about your initiative about cleaning up the arctic and doing it together with the united states what kind of response did your idea receive here in washington, d.c. >> we discussed a lot about black carbon, and to explain to everybody, what happens is that
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from atmosphere black carbon covers the arctic, and we know what happens when sunshine meets black. it melts ice, and the probl -- it melts ice. if we lose the arctic we lose the globe, that's reality, so we might fight against those emotions spreading black carbon. i understand that the united states is going to put it in half, and we know that black carbon sources are a lot of them in russia. they are old-fashioned energy plants producing heating the other problem is flaring you know, that in oil fields they flare up and the amount is
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huge yearly they flare 40 times more than finland so if we can, and here comes also business to picture it would a good business to renew those old-fashioned plants, to make more with less energy it would be a business to stop flaring, to take accuse of that gas that is now burpd, and i think that these elements are things that we can continue discussing in arctic council we have inherited the chairmanship from the united states and we continue the work. >> we had a very good discussion in particular on the arctic and black-on, and i think we have much in agreement. one of the things we also agree on we want crystal clean water, and we want clean air, the cleanest
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ever, very important, so we have a lot of agreement john roberts, yes. mr. president, thank you so much i have a question for both of you, but if i could start with president trump. in the middle of hurricane harvey hitting friday will night you chose to pardon former sheriff joe armio. i wonder if you can tell us what was behind your thinking for issuing the pardon and what do you say to your critics, even some in your own party, who say it was the wrong thing to do >> well, a lot of people think it was the right thing to do, john, and actually in the middle of a hurricane, even though it was a friday evening, assumed the ratings would be very higher than normally, the hurricane was just started and i put it out as i pardoned, as we say, sheriff joe. he's done a great job for the people of adds adds.
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he's very strong on borders. very strong on illegal immigration. he is loved in arizona i thought he was treated unbelievably unfourly when they came down with their decision to go get him right before the election voting. he lost in a fairly close election he would have won and they just hammered him before the election i thought that it was a very, very unfair thing to do. when i mentioned him the other night, you saw the massive crowd we had h.the people went crazy when i said what do you think of sheriff joe or something like that, the place went absolutely crazy when i was in arizona last week and as far as pardons are concerned, i actually did this just before the meeting because i assumed somebody would ask me the question i didn't know. you didn't even know you would be called and inthought i would. sheriff joe is a great veteran of the military, great law enforcement person, somebody that's won many, many elections
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in the state of arizona but i wanted to look at some of the other people that were pardoned over the years, and if you look as as an example president clinton pardoned mark rich who was charged with crimes going back decades including illegally buying oil from iran while it held 53 american hostages, wasn't allowed to do that, selling to the enemies of the united states. he was pardoned after his wife donated hundreds of thousands of dollars to the clintons. and then you have dangerous criminals, president clinton pardoned susan rosenberg, a member of the weathered underground charged as part of a bank robbery that led to a guard and two police officers being killed drug dealers, president clinton commuted the sentence of carlos vignali, a central player in a cocaine ring that stretched from california to minnesota. criminal leaker, you've heard
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the word leaker. president obama commuted the sentence of chelsea manning who leaked countless sensitive and collap classified documents to wikileaks and perhaps others and horrible, horrible thing that he did, commuted the sentence, and perhaps pardoned president obama commute the the sentence of oscar lopez rivera who was charged as part of a violent independent group from puerto rico responsible for 28 chicago-area bombings and many deaths in the 1970s and 1980s. sheriff joe is a patriot sheriff joe loves our country. sheriff joe protected our borders and sheriff joe was very unfairly treated by the obama administration, especial little right before an election, an election that he would have won, and he was elected many times,
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so i stand by my pardon of sheriff joe, and i think the people of arizona who really know him best would agree with me thank you very much. >> mr. president, i would like to claim that you did all the research and the question was very obvious given the history and the ideology of the taliban, do you ever believe that they would honor any kind of an agreement that was ever made, or would they when the united states and finland and other countries leave afghanistan, renege on that deal? >> yes first of all, i want to underline that finland has been involved from the very ding to all the attempts to solve the situation in afghanistan
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we have troops there we have also financial aid going on all the time. we have to try we have to try in all possible ways to solve the situation in afghanistan. it has been ongoing quite a long time for decades but to solve it by negotiations surely you have to have full respect to the one you negotiate and to also -- and also full belief that what is negotiated is also fulfilled. p these elements has to be all the time present when you discuss with which ever party in afghanistan. >> i know there might be a couple more questions, but do you want to take one more? would you want to take one more.
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go ahead, pick go ahead. >> please. >> again. >> you're going to give her the same one no, she's not the same lady. >> go ahead. >> they are sitting side by side. >> have a lot of blond women in finland. mr. president trump, what kind of role do you see finland having in the u.s.-russia relations? do you think finland could be of assistance helping the u.s. get better relations with russia >> i hope we do have good relations with russia. i say it loud and clear. i think that's a good thing if we have great relations or at least good relationships with russia, and that's very important and i believe some day that will happen it's a big country it's a nuclear country it's a country that we should get along with and i think we will eventually get along with russia finland has been respected by russia, finland has been free of rush, one of the few countries in the region for 100 years, and russia has a lot of respect for finland, so that's always good
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i think finland is doing fine with russia, and i hope that the united states will some day be able to have a very good relationship with russia also. i think that's very good for world peace and for other things thank you. >> as a follow-up, if fin lann's relationship with russia were to deteriorate, would the u.s. -- what kind of assistance would the u.s. be willing to give to finland bilaterally, if we needed it? >> well, as i said before, you know, our relationship with finland is a very close unand we're always ready to help finland. you're purchasing large amounts of our greatest 18 aircraft from boeing, and it's one of the great planes and great fighter jets, and you're purchasing lots of other military equipment, and i think purchasing very wisely are. i know all of the military equipment, and i actually agreed with everything that you purchased. we've talked about it before i think finland is really a respected country militarily
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it's got large armed forces for its size, as a country really proportionally probably one of the biggest in the world if you think of it, but they are very respected militarily and they are respected beyond militarily so hopefully it will never come to that thank you. >> did you discuss russia, and did you offer any assistance to the u.s. with their relationship with russia? >> well, we, like i said earlier on, we did discuss about russia, but actually i don't feel myself as being an adviser to anybody, but we try to do our best and hopefully we get also results from that. i want to remind you that in nato meeto a year ago approximately, it was stated by
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all nato countries that with russia you have to be deterrents, but you also have to exercise dialogue, two these two-way elements have to be there >> yeah, go ahead. >> mr. president trey with one america news in the aftermath of hurricane harvey, do you believe cutting fema's budget is the right thing to do? >> no, i think what's going to happen is the fema money is relatively small compared to the rebuilding money so fema right now we have the money necessary for texas and louisiana if we need, but the -- you know, the real number which will be many billions of dollars will go through congress i think it will happen very quickly, it will go very fast and i want to congratulate you on the network it's a great network. >> thank you if i may follow-up on one other question. >> yes. >> from earlier. the southern border wall, is your plan still to have mexico pay for the wall >> yes, they will, one way or the other mexico is going to pay for the wall, that's right
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it may be through reimbursement. one way or the other mexico will pay for the wall we're right now negotiating nafta, in my opinion, mexico's been very difficult, as they should, why wouldn't they be they had a sweetheart deal for so many years. it's one of the great deals of awetime for them, one of the worst ever signed. i guarantee you, mr. president, finland would never have signed nafta with russia or whoever you wanted -- this is not a deal that you would want to sign, this is not a deal that finland would know about nafta is one of the worst trade deals ever signed at any time anywhere in the world and i can understand why mexico is being difficult because why wouldn't they be? they've had it their way no, mexico will pay for the wall, it may be through reimbursement. we need the wall very badly. as you know, mexico has a tremendous crime problem tremendous one of the number two or three in the world and that's another reason we need it. and the -- just to add on, tremendous drugs are pouring into the united states at levels that nobody's ever seen before. this happened over the last
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three to four years, in particular the wall will stop much of the drugs from pouring into this country and poisoning our youth. so, we need the wall, it's imperative we may fund it through the united states, but ultimately, mexico will pay for the wall. >> sir, if i may follow-up, on tuesday you said if we have to close down our government, we are building that wall. >> well, i hope that's not necessary. let me just -- yeah, i hope that's not necessary if it's necessary, we'll have to see, but i hope it's not necessary. the wall is needed from the standpoint of security the wall is needed from the standpoint of drug -- tremendous -- the drug scourge, what's coming through that area, through the areas that we're talking about, as you know, i have general kelly here. we stopped traffic coming through 78%. it's going to be i think 81% this quarter which is a record in other administrations, if they stopped it just a little bit like 1%, %, 3 2%, 3%, they
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considered that a great thing. we're up to 80%. we'll soon be over 80% you need the wall to do the rest and you need the wall for the drugs. the drugs are a tremendous problem. the wall will greatly help with the drug problem and ultimately, that's a good thing for mexico also. we have a very good relationship with mexico. but i will say that dealing with them, i've always said, i've talked about nafta, you heard me many times and i've said we will either terminate it or renegotiate it we're in the process of renegotiating right now, renegotiating the deal i believe that you will probably have to at least start the termination process before a fair deal can be arrived at because it's been one-sided deal, and this includes canada, by the way, great respect for canada, great love for canada, but it's been a one-sided deal for canada and for mexico and the united states ' workers, all
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of these incredible people who have lost their jobs because of nafta, they're not going to be suffering any longer it's been unfair for too long. so, we will build a wall and we will stop a lot of things including the drug -- the drugs that are pouring in at levels like nobody's ever seen. we'll be able to stop them once the wall is up thank you very much. thank you. thank you, everybody. >> thank you >> the president finishing his press conference with the president of finland, and covering a very wide range of topics we're going to get a covering brief from eamon javers in just a moment of course, starting with the things he said about hurricaneda task catastrophe, looking more and more likely louisiana will be hit and confirmed he'll travel to louisiana on saturday, having gone to texas tomorrow >> says his adds station has pledge
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recovery, we're one american family did talk a lot about nity, he' going to be visiting texas to see they're receiving all the support. he made a lot of news in the q&a. let's get to eamon javers. refusing to specifically fa ica russia a security threat, hoping the government doesn't have to shut down over his wall, to confusing a finnish reporter and learning there are a lot of blo blonde women in finland. >> reporter: we heard a lot at the press conference, sarah. as the president was leaving, a reporter shouted out, do you still have confidence in your secretary of state rex tillerson? the president at that moment was standi ining eight feet from re tillerson in the front row here, president did not respond to the question which was prompted by tillerson's moment over the weekend on national television, he was asked about american's values and the president's values tillerson said simply the president speaks for himself, viewed widely as an implicit criticism of the president, himself.
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the president not taking the bait in terms of that question this time, not responding in any way just now you heard a range of those other answers as you were discussing including the relationship with russia, saying many nations are a security threat. but refusing, or opting not to label russia, itself, as a security threat. so, a lot going on here at this press conference, including some geopolitics, guys. >> eamon, thank you very much for that we'll continue to discuss the fallout, of course, from the -- the main takeaways from the press conference coming up. tonight on "fast money," the man who called the decline in natural gas will give his take on hurricane harvey and the aftermath. we're back here in a couple minutes to wrap things up on "the closing bell. oh no. schwab, again? index investing for that low? that's three times less than fidelity... ...and four times less than vanguard. what's next, no minimums? minimums. schwab has lowered the cost of investing again. introducing the lowest cost index funds in the industry
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we say thank you to mike san thole, as always, make he should thank us he's a regular on the show. >> it's a pleasure. >> an after hours moving that you're watching. >> yeah, finish line, a pretty bad pre-announcement, footwear retail retailer second, third quarter sales earnings lost. the whole thing. nike, under armour being pressured after hours. finish line, the shares are halted even know it's not a big retail outlet for them -- >> foot locker under pressure. this is the whole new retail group that's going to get hit as
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a result of amazon online, nike, under armou ar, adidas going to consumer direct through their website. >> the dollar, again, another senior sov soft -- >> we always watch the dollar. >> 120, the euro. >> highest level since 2015. we'll leave it there that does for us on "closing bell." "fast money" begins now. >> "fast money" starts now, live from the nasdaq market site overlooking new york city's times square, i'm melissa lee. traders, tim seymour, david seaburg, steve grasso, guy adami. the destruction of hurricane harvey continues to unravel. texas deals with massive flooding and more rainfall expected in the next couple days we just heard the president addressing the nationwide effort of are rescue and relief in the state of texas brian sullivan on the ground in galveston, texas, monitoring the impact of the emergency ecosystem. let's go to him. brian? >> reporter: hey, melissa, thank you very much. the winds are picking up in galveston.


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