Transcripts For CNBC Closing Bell 20140313

Its comments by mario draghi, which have sent the youeuro lo. All over the map today so far. The point is, its our fourth consecutive down day. Thats right. Were going to keep a close eye on markets. Were seeing the s p 500 selling off by about 22 points. We mentioned the dow off 220 to 161138. The nasdaq losing ground as well, off 68 points in the session today. Lets talk about it in our closing bell exchange. We have heather hughes, greg ip, amy wu, ron weiner, and our own rick santelli. Were going to bring a trader from the floor. You want to bring him over . Come here, warren myers. Come on over. Well get you in place as well. Im going to start with rick santelli. Because of the lack of consensus, mr. Market, on whats causing this selloff today, you know, what do you make of that when nobody can agree on why people are selling equities today . Oh, i dont agree with that at all. Just because you have six different aisles at a supermarket being crowded, its no reason to say you dont understand why they all want to get into the store. They do. So you have one aisle thats nervous about how the german stock market is trading. One aisle is nervous about the trend in china. Both on their data, what they have to back their loans. All that has affected the yuan. We have another aisle looking at the stock market versus the treasury market in terms of where do you want to have your money. I think it all makes perfect sense. The thing thats different today, two things actually. The first is Interest Rates were leading stocks today. It was a close call, but thats what ive garnered. And i think the second issue is that all those things are proactive on the same session. Amy, how much further do you think we have to go here with this move to the downside . Thats a good question. And i dont want to sound like a broken record, but honestly, from the Options Market it would tell you not that much more because it hasnt been panic or protection being put on. You see a handful of eem trades, a handful of xfi, a handful of other things. However, its not this consistent downside put protection youre seeing being bought. Its something relatively muted from our side. Greg ip, mario draghi about an hour ago making comments that sent the euro lower. That seems to push our market lower in the last hour. What do you make of comments theyre making over there where the German Market has been suffering . The European Central bank, of all the folks who matter on this story, seem least worried about the low inflation trend thats been going on in europe. So one of the reasons the euro has been so strong is perception that the europeans are not going to ease into this disinflationary trend. The selloff in commodities weve seen over the last day or two is just going to muddy the picture fur further. Its going to continue to give us this tension between low inflation and a central bank in europe and United States that doesnt seem to worried about it. Ron, if you wanted to take china as a case in point, you can paint a picture where things look okay for u. S. Equities here if china slows a little bit, maybe Commodity Prices drop because of that but its actually a break for consumers over here. I guess the real question when we look at markets today is, is this just that sort of issue . A china issue that we have to work through, for example, or is there something more systemic here that people seem to be concerned about . What do you think . First off, investors are still skittish starting back from 2000. We have a much more skittish environment for anything that happens, anything negative or positive, but mostly negative. I think it is a combination of all these things happening all within the same week, ten days. But the u. S. Is the safe place or the safer place to be. I would be thinking, okay, wheres the opportunity in this . Maybe not today. Maybe not next week. But theres definitely an opportunity. The u. S. Is growing. It is more stable. Our banking is better than european banking. So the s p is flat. I think were okay. I dont think were great, but i think were okay. I would be looking for opportunity in the u. S. Some of these things will boil over. Some of these things will calm down. Doesnt matter over the next 6, 12 months, i think the u. S. Market is higher. Heather, im going to let you speak to the individual investor out there. What are they to make of all this as we try to come up with reasons for this selloff today . Do they buy this dip . Do they stand clear . I think over the past three hours today, theres definitely no shortage of red flags when youre looking for reasons to climb a wall of worry. As were all alluding to, tensions out of russia, the china market, obamacare coming up. So that will still hold true. Two quick things. I think no one would be surprised if political tensions out of ukraine led to economic stability as we get closer to imposing sanctions against russia. Number two, regarding china, the wave of chinese defaults on their bonds that may occur and their shadow banking system, in order to shrink their system, we need to provide more loans to nongovernment institutions. That may not be a bad thing. Lets flush out some of the toxins in the global economy. Lets address the problem in china of being a more or lacking a consumer driven economy. Right now u. S. Consumes, china produces. We need china to consume. Just to be clear, when you were talking about some of the geopolitical unrest coming out of ukraine and russia, you said that was going to cause stability or instability . Instability. Yes, instability in terms of the economic sanctions. I think youre seeing it regarding the markets a reversion back to value, perhaps. You saw the highflying growth social media stocks outperform during the first two months of the year. Now youre seeing investors not just that trade that rick alluded to, meaning theres no alternative to stocks. Now, if we get a bit here, down 225 on the dow, you may see a reversion to value heading into march and april into the spring. By the way, i hope everybody saw squawk box this morning. Jack welsh saying there is no alternative trade, meaning investors are trapped in the equity market. They have no other place to go. Except for today. Warren myers, youve been constructive on this market. Now were seeing a pretty serious selloff. What do you make of this . Were seeing global events trumping the u. S. Domestic data thats been coming out. The data that came out today was marchly pretty decent. Jobless claims were good. Retail sales were good. Exactly. If you get this trend of global events pulling the u. S. Equity market down, youre going to get a bigger divergence between the quality and the weakness in other markets. Once this settles out, this will be the place to be. Warren, whos selling today . Is it real money . Is it the hedge funds, retail . I think its a little bit across the board. I think its a lot of people taking profits in stocks theyve been holding on to for quite a while and locking something in. Theres certainly no sense of panic here. The volume is still relatively light. I dont see it as any worry signal. If volume is heavy, rick, its heavy in the treasury markets. Its akin there to a day where we might have got an fed statement or where we might have got an jobs report. Huge activity. Its brought yields down. Its confirmed some of the weakness we already saw across the treasury space in the last couple sessions. Exactly. I think a very important point we need to bring up here is traditionally, you know, lower Interest Rates are always viewed as a big positive for equities. I dont think this is the case in any regard. On another front, when we talk about china and heather brought up a good point. We need to shift it to a consumption economy. The president in his first term in this country said we need to shift more to an export economy. Both of those are noble endeavors. But they take a long, long time. None of those issues are going to happen in the here and now with respect to the proactive realignment of these pieces. Bill, kelly, we were talking off camera that this month the ism manufacturing was up and the ism nonmanufacturing was down. Thats counterintuitive to Americas Service economy. We are coming back, but we dont have to come back a lot. The worlds still growing. Maybe not growing fast, but thats more toothpaste, more computers, more iphones, more cars. I think america is the safe place. But thats whats so interesting. We mentioned yesterday that was getting a lot of traffic, this whole idea about how strong the u. S. Looks. Greg, if you had told people today we were going to get the retail sales report we did, except for maybe some lower revisions to prior months, and the jobless claims figure, you would not have expected to be down almost 250 points in this session. Yeah, exactly, kelly. In fact, thats precisely why im not getting worked up about this drop in the dow. To the extent weve been going back and forth is it because of the weather or because the economy is rolling over . The better than expected retail sales data and jobless claims number lean you towards saying its probably weather. If you are worrying about the economy hitting a soft patch here, you should be less worried today. And that probably also means that next weeks fed meeting is probably going to be as much of a nonevent as it can be given itll be the First Press Conference for janet yellen. Shes hoping its a nonevent. Very quickly, warren, talk us through this last hour. What do you expect to happen . I was looking at the market on close and balances. They were slightly leaning to the buy side. Nothing huge. I dont see that having an impact at the end of the day. I think well close near the lows. Thats the trend weve seen for today. Heather, what were you going to say . Oh, just regarding the weather. I think or was that amy . It was amy. Sorry. Go ahead, amy. One of the biggest debates were having with clients is whether or not buy backs continue or with cap capex increases. Both these things are extremely positive. Its just a question of which one is going to lead the charge. Great point. Thanks, guys. Thank you, everybody. See you later. Warren, well let you get back to work. Much more on this surprise selloff throughout this next hour as we head toward the close. The dow just off the low set moments ago. Were down 238 points right now. The nasdaq having its worst day in quite a while. Were down 73 points on the nasdaq composite index. Frankly, some of the higher momentum names, if you want to call them that, thats where we saw the early weakness. Its confirmed with some of these etfs. By the way, defensive measures are doing very well. Utilities are very strong today. So were seeing a lot of these defensive issues that nobody wanted to buy at the beginning of the year coming back so far today. President obama putting pen to paper on a controversial executive order, expanding overtime pay for millions of americans. How will this go down with Corporate America . We have two members of cnbcs own chief Financial Officer council. The financial chiefs of abbott labs and trulia will talk to us about what expanding overtime pay will mean to their company. Also, with food inflation on the rise, the ceos of agco plus, the head of fast food giant taco bell, will weigh in on all of that. By the way, taco bell is entering the breakfast wars. Out with new breakfast items, including the waffle taco. Really . For breakfast . Well hash that out coming up. Stay tuned. Kelly told me to say that. [ male announcer ] this is kevin. To prove to you that aleve is the better choice for him, hes agreed to give it up. Thats today . [ male announcer ] well be with him all day as he goes back to taking tylenol. I was okay, but after lunch my knee started to hurt again. And now ive got to take more pills. Yup. Another pill stop. Can i get my aleve back yet . For my pain, i want my aleve. [ male announcer ] look for the easyopen red arthritis cap. Its amanda. Hey sweetie. What . [phones rings] okay, ill send it. One hundred seventytwo dollars for a chemistry book, what is it, made of gold . Just use citi popmoney. Boom. Ah, shes feeling lucky. Hey sweetie. Cancun, yeah no, youll be spending spring break with your new chemistry book. With citi popmoney its easy to send money to just about anyone, anytime. Visit your local branch or citi. Com easierbanking to learn more. Welcome back. If youre just checking ining the day, weve had a substantial selloff and a flight to safety at the same time, as bonds have seen their heaviest date in while. Defensive stocks are very strong day. Meanwhile, the dow is down 1. 5 today. The nasdaq getting hardest hit, down 1. 7 . There are a myriad of reasons. You pick, most of them having to do with overseas action. Weaker economy in china. The unrest in the ukraine. The problems in the european arena economically. Mario draghi making comments earlier today. Whatever it is, we have the worst selloff weve had in quite a while on wall street today. And in the last hour in washington, president obama made his controversial executive order, expanding overtime pay. He made that official today. Eamon javers following that out of washington. Thats right. The president wants to change two key thresholds. He wants to change the salary point at which people have to collect overtime pay. He also wants to change the rules around the type of work involved that you are allowed to be exempt from overtime pay. Both of those things have taken together could expands overtime for millions of americans in an election year. The white house thinks thats good politics. The president today said its about basic fairness. Take a listen. If youre working hard, youre barely making ends meet, you should be paid overtime, period. Because working americans have struggled through stagnant wages for too long. Every day i get letters from folks who just feel like theyre treading water, no matter how hard theyre working. And guys, the president saying this is about basic fairness, but its going to have to go through that bureaucratic process over at the department of labor. Just because he signs an order today doesnt mean thats happening any time soon. Bear in mind as well. During his year of action. Thanks, eamon. Reaction now from two key players. The cfo of abbott labs and the c. O. O. Of trulia. Welcome to the new york stock exchange. We just heard a series of measures coming out of washington, trying to boost pay for minimum wage workers, now for overtime workers. Thomas, whats the impact for your business . Were in the business where i think there will be minimal impact. I do think this is something that for many business persons, there are only two things that can happen when costs go up. Its either to reduce costs elsewhere or to pass them on to consumers in some ways. Itll be interesting to see how this plays out and what it means for other Companies Across the country. You feel the same way . I think the president s proposal is a step in the right direction. Not only is it right for income inequality, its also right for the economy. I say that because, keep in mind, all of these minimum wage workers are also consumers. And the extra income they will earn will likely go right back into the economy in the form of more, you know, School Supplies for their kids, more groceries. So this is fascinating. I didnt know necessarily if you guys would agree or disagree. We have now incapslated the two different views of this issue across the u. S. Economy. Youre not talking like a cfo. Look, i think its right for the economy. It is going to come back into the economy. Almost certainly it will end up in extra spending across different sectors. I can tell you, you know, first hand i started out as a dishwasher earning 3. 35 an hour. And its hard to make ends meet on that kind of an income. If you had made more, would you still be a dishwasher today . If you made 20 an hour as a dishwasher unlikely. The fact is, it would have enabled me to support myself and if i had a family better. Its likely that money would not have been saved but would have been used just to make ends meet and therefore would have come back into the economy. All right. Lets move on to other areas. Obviously both of you represent two key areas of the economy right now in health care and in real estate. Health care, obamacare, their costs are going up. What does that do for your business right now . Well, abbott has always supported the Affordable Care act from its main objective, which is access to health care for all americans. From the beginning, weve been supporting that. It has had an impact on our company. You know, we are a medical device company. At least thats one of our businesses. And, you know, we pay the medical device tax. Thats affected our ability to potentially invest in innovation as we go forward. You know, the u. S. Market is very important to us. This plan is very important, but its only about 30 of our business. Were about 70 outside the u. S. Very emerging markets focused. You know, thats where were mainly focusing our investment these days. Well see how it plays out longer term. That emerging market focus, does it make it hard to sleep on a night like this . You have to have a long view with emerging markets. We have a long history, decades long of dealing in these markets. Weve seen the turmoil. Weve seen things come back stronger than ever. Its been a little noisy the last few months, but if you in a lockterm business Like Health Care where you have to invest and in these economies where the growth rates are two times the developed world, where health care is increasing as a percentage of the economy, its really where you have to be if youre going to have a chance to grow as a health care company. Sean, real estate grows in fits and starts here since the recession. Congress wants to do away with fannie may and freddie mac. A lot of head winds in your industry. Whats it done to your business . Theyre definitely head winds, but theyre tail winds. Its not going to be a smooth journey ahead, but were at the beginning of a sustained recovery. Theres plenty of bad news. Some youve cited. If youre a home buyer this spring season, things are less affordable than they were last year. Home prices are up 10 year on year. Mortgage rates rinare inching u and they have nowhere to go. But if youre out looking this spring, theres probably more inventory in the market. Rises prices have brought homes on to the market. And theres less competition. 2013 was about the investors. But theres less inventor noir. Home builders have not been building. Theyve not come back in a great way since the great recession. And new home buyers, very you know, they want to buy right now, but it is tougher for them to afford, and theres not as much inventory. Youre sort of in a bottleneck period right now for the real estate market. There are. There are mixed signals, undoubtedly. The key here is to not overfocus on any one particular index. Things are, you know, ufz to look at new construction. At the same time, you have to look at mortgage rates. You have to look at employment numbers. And taking all of those together, what we see as an economy, a realistic market that is coming back into balance. In fits and starts, but its coming back. Thomas, were still looking at markets off 250 points today. We talked about some of the weakness in emerging markets as well. This is all going to come back to how strong the u. S. Economy is fundamentally. It will also, of course, touch on these issues coming out of washington with weather and what to do about pay. But do you think . How strong is demand fundamentally across the economy . Were encouraged by what were seeing. The pmi indexes are improving. I think growth towards 3 this year seems to be where its heading. I think were looking at a weaker First Quarter because of the weather and various things people have been talking about. But we are encouraged. The private sector level is improving. Just as you said, as the developed world improves and theres some progress in europe, its going to help the emerging markets as well. Ultimately, the developed world is the Customer Base for those worlds. You guys going to be hiring here this year . Abbott is investing in a number of areas of growth. Id say the employment in the u. S. This year is going to be pretty stable basically. Tom, sean, good to see you both. Thank you for joining us. Really fascinating. Appreciate it. We have a little more than half an hour to go. Were having one of the weakest sessions for markets this year. The dow is off 238 points. The nasdaq off 75. Bill . All right. Meat, milk, eggs. The department of agriculture warning the prices for these staples will skyrocket this year. Courtney reagan breaks down the pain well all be feeling soon coming up next. And well get reaction from two ceos whose businesses will be directly affected by rising prices. Dont go anywhere. Well be right back. Tdd 18886486021 there are Trading Opportunities tdd 18886486021 just waiting to be found. Tdd 18886486021 at schwab, were here to help tdd 18886486021 bring what inspires you tdd 18886486021 out there. In here. Tdd 18886486021 out there, tdd 18886486021 there are stocks on the move. Tdd 18886486021 in here, streetsmart edge has tdd 18886486021 chart pattern recognition tdd 18886486021 which shows you which ones are bullish or bearish. Tdd 18886486021 now, earn 300 commissionfree online trades. Tdd 18886486021 call 18886486021 tdd 18886486021 or go to schwab. Com trading to learn how. Tdd 18886486021 our trading specialists can tdd 18886486021 help you set up your platform. Tdd 18886486021 because when your tools look the way you want tdd 18886486021 and work the way you think, you can trade at your best. Tdd 18886486021 get it all with no trade minimum. Tdd 18886486021 and only 8. 95 a trade. Tdd 18886486021 open an account and earn 300 commissionfree online trades. Tdd 18886486021 call 18886486021 to learn more. Tdd 18886486021 so you can take charge tdd 18886486021 of your trading. Welcome back. Heres where we stand. The dow off 237 points or 1. 5 . The nasdaq, the weakest link, off 75. And pain in the wallet in the meanwhile. The Agriculture Department warning about price increases for dairy. Courtney has details for us. Hi. Good afternoon. Higher commodity costs, the constrained consumering and weather. If you combine all of those head winds, youve got a combination of protein pain. Its impacting both Food Companies and customers. The usda is forecasting protein inflation to more than double this year thanks to adverse weather, viruss that have spread throughout livestock herds, and the results shuffle in supply and demand, leaving Food Companies and restaurants debating just how theyre going to dole with these higher input costs. The surge in beef prices from constraints apply has been more difficult for a company like texas roadhouse to swallow. The casual dining restaurant has a goal of keeping expenses low. Thats important for this restaurant that gets more than 70 of its sales from diners that come two or more times per month. They would definitely notice those price increases. Protein pain, though, of course stretches beyond just beef. Its into dairy too. Also a derivative product from cattle. Ann annies expects inflation to remain tough, particularly in organic cheese and cheat, also important for a company that counts mac and cheese for 40 of its sales. When we asked yum brands about its food inflation, they said theyre not concerned about it this year. Theyre expecting low single to midsingle digit food innation for the coming years. Not everyone is worried, and not everyone is passing along those higher costs to consumers but certainly some are. Kelly and bill, back to you. Courtney, thanks very much. Joining us here at Pacific Ocean nine, bob crain, Senior Vice President of agco, based in georgia. Courtney was telling us about the impact itll have on the middlemen, those that have to sell the items to the public that have a higher cost. What about at the source. The farm economy has been hot the last few years. If prices continue to rise this much for food items, does that put a cap on that growth rate . The basic fundamentals it behind this business are still excellent for all of us in this business. Three, four key drivers of this business right now. Certainly the World Population growth. Over 9 billion people in this world anticipated by 2050. A few short years away. Along with that, we see a growing, growing shift in the need for protein throughout the world. Obviously protein is good news for our industry. I got to ask you about a couple of things that everyone here on the floor is talking about today. Thats china, russia. You have businesses in places with exposure to these markets. Were seeing a big drop in europe, where you traditionally have a big chunk of business. Those markets are weak today. China, everyone is concerned about growth slowing. Walk us through the scenarios you could foresee this year here in 2014 as everyone tries to make sense of them. I look at things very, very basically. Economics 101. Supply and demand. I think as things happen in the ukraine, as things happen in russia, obviously thats going to upset the balance of supply and demand. We think that could be good news for this industry. Would you like to explain or give an example of why . Obviously, for example, ukraine. A significant producer of grain. Who knows what could be happening in ukraine in the coming weeks, in the coming months. We think that bodes well for other opportunities for other areas can of the world that pro those grains. It could possibly have an upside in terms of price. So crisis in one spot creates opportunity in another. What about weather . Theres been drought and heat and less planting for a lot of farmers. Well, a little different look. Its hard for many people to understand our viewers to understand. But drought in many, many parts of the world means great news for producers in other parts of the world. Again, basic economics 101. Supply and demand. So again, crisis in one area is going to create opportunity in other areas. No doubt. But youre serving both those areas. If one area is going down, the other cant go up that much, cant it, in terms of demand for equipment. Certainly we saw that last year. Significant, significant droughts in parts of north america, which is my area of responsibility. But at the same time, it created opportunities in other parts of just north america that compensated more than enough. Just real quick, last question, are we seeing another dust bowl like phenomenon across the u. S. . I wish i could forecast that. I dont think we are. I think its the normal plips that you see. In my opinion, i think were going to see a normaltype year in terms of production in north america. We will see. Bob crain, thank you for joining us today. Thank you for having me. We continue this selloff. About 30 minutes left. The dow down 231 points. The fourth consecutive down day, and this by far is the biggest of the down days. And were going to hear from taco bells ceo next about his restaurants big move to get consumers considering it for their morning meal. Hell be here exclusively to make his case. And even more confusion as the malaysia air continue search continues. There have been many conflicting reports today. We will sort it all out, bring you a complete update on what so far is one of the great mysteries of this generation. Stay with us. We only know one direction up so were up early. Up late. Thinking up gamechanging ideas, like this dozens of tax free zones across new york state. Move here. Expand here. Or start a new business here. And pay no taxes for 10 years. With new jobs, new opportunities and a new tax free plan. Theres only one way for your business to go. Up. Find out if your business can qualify at startupny. Com ameriprise asked people a simple question can you keep your lifestyle in retirement . I dont want to think about the alternative. I dont even know how to answer that. I mean, no one knows how long their money is going to last. I try not to worry, but you worry. What happens when your paychecks stop . Because everyone has retirement questions. Ameriprise created the exclusive confident retirement approach. To get the real answers you need. Start building your confident retirement today. Is really what makes it slike two deals in one. He 1,000 fuel reward card salesperson 2 actually, getting a great car with 42 highway miles per gallon makes it like two deals in one. Salesperson 1 point is theres never been a better time to buy a jetta tdi clean diesel. Avo during the first ever volkswagen tdi clean diesel event get a great deal on a jetta tdi. It gets 42 highway miles per gallon. And get a 1,000 fuel reward card. Its like two deals in one. Volkswagen has the most tdi clean diesel models of any brand. Hurry in and get a 1,000 fuel reward card and 0. 9 apr for 60 months on tdi models. Welcome back. A down session for stocks across the board. The dow off more than 230 points. The nasdaq off 70. Were seeing pressure on the treasury yield as well, which has fallen considerably. Were keeping a close eye on the dollar as things get a bit of a flight to safety bid. Certainly not across stocks, where its selling across the board. Pretty much red arrows across the board. Dom . Lets start off with herbalife losing ground for the second consecutive day after it said it was being investigated by the federal trade commission. Thats a big move to the downside. Also, Goldman Sachs lower as theyre downgraded from a sell rating to a buy rating. Also lowered the price rating to 158 a share. It was 195 before that. It thinks First Quarter tradesing revenues are tracking lower. Mcdonalds also moving lower today. Workers this week filed class action lawsuits in california, michigan, and new york claiming the company is systemically stealing employee wages by forcing them to work off the clock and not paying them overtime. Mcdonalds is telling cnbc they are currently reviewing those allegations. Then theres World Acceptance Corporation sinking today after they received a cid from the Consumer Protection bureau. On the flip side, you have plug power. It expects orders to rise almost four times this year. Back over to you. Thats been very volatile recently. Thank you, dom. Well, the battle over breakfast is about to get a new and some would say unlikely participant. That would be taco bell, which is thinking outside the bun, as they like to say. Now theyre making a move into the breakfast market. The new menu is set to roll out later this month. It includes items like the waffle taco. Obviously, i cant wait for that. Yes, you can. Now joining us in a cnn krn exclusive is taco bell president brian niccol. Thank you. Glad to be here. Why breakfast . Is this a sign of desperation . Its a sign of great opportunity. As you mentioned earlier, i think everybody in america is truly excited for the waffle taco and taco bell to get going with breakfast. I mean, other fast food giants have moved into breakfast. Youre coming to the game kind of late. What kind of a bump do you expect in sales . You know, what were really excited about is putting a twist on the ordinary. I think breakfast for a long time has just been really ordinary. Whats in the dna of taco bell is just innovating. We think we can make a really big impact at the breakfast part because the innovation were going to bring and based on the feed back weve gotten from all our wonderful customers. So what kind of bump are you expecting in sales, he asked again . Well, you know, ive got some bosses that arent exactly ready for me to talk about that right now. But on march 27th, well start to see the bump, and what weve seen is it is truly incremental for our business and our team members are just so energized to give people an experience unlike theyve ever had at breakfast. Brian, all the same, its a big deal to decide to keep these locations open longer hours, if thats part of it. Especially at a time when longer hours is going to mean potentially higher wages, potentially higher overtime pay. Why make this decision now if youre not 100 sure yet as to just what kind of payoff and consumer response theres going to be. We are 100 sure this is going to be a great outcome for taco bell. We are adding three, four hours. This actually presents a great opportunity for us to hire more people, give people more shifts, and, you know, i think really give people a terrific experience at breakfast. How much does it cost to do all of that for your business . It varies by store, but weve been very specific over the last couple years getting into breakfast in a smart way. We want to get in, in a way where it adds to our business, it adds to our experience. You know, cost has not been one of our problems as were getting ready to enter into our breakfast market. Are fast food menus becoming too complicated . There was a story recently about mcdonalds and all theyve added to their menu. The wait time grew because workers found it more complex to put a lot of the new products together in addition to Everything Else they had to make at that time. Youre adding to the menu appreciably of the taco bell franchise. Are they going to find it difficult to serve their customers in a timely fashion with a more complicated menu . You know, thats one of the things weve been very, very careful with. We most recently are in the top of a lot of qsr as it relates to speed and accuracy and hospitality. We want to do the very same thing at breakfast. So weve taken time to make sure that we can deliver the speed, we can deliver the great products, just a tremendous value, and what weve seen is actually a halo effect on the rest of our business to the positive. So you dont mind a higher minimum wage, brian . You know, luckily for us, we dont have anything to do with setting minimum wage. We pay our team members more than minimum wage. What im really excited about is the fact i get to hire another 15,000 people that are passionate about taco bell. Thank you so much for being here, brian. Really appreciate your time. Please come back and tell us how the launch goes. Im sure well hear about it. Will do. Enjoy some waffle tacos as well. Take care. Trying to think of a market metaphor for that right now. Its clear theres no waffling today, though. Were off about 223 points on the dow. Up next, more questions than answers in the search for the missing malaysia airplane that vanished almost a week ago. Well have the latest developments from qua la lumbar purr. And the numerous conflicting reports. After the bell, General Motors may have known about safety defects three years earlier than it previously disclosed. As early, in fact, as 2001. Suddenly observers are comparing the handling of this mess to how Tobacco Companies handled investigations in the 1990s. The latest on this story just ahead. Ead. Ce. For access to one of the top Wealth Management firms in the country. For a team of Financial Professionals who provide customized solutions. For all of your Wealth Management and retirement goals, discover how pnc Wealth Management can help you achieve. Visit pnc. Com wealthsolutions to find out more. Here in philadelphia you can access a philly cheesesteak anytime, day or night. Just like you can access geico anytime, day or night. There is only one way to celebrate this unique similarity. Witness the cheesesteak shuffle. Cheesesteak, cheesesteak its the cheesesteak shuffle huh every day, all day, cheesesteak, cheesesteak every night, all night cheesesteak, cheesesteak 9 a. M. Cheesesteak 2 p. M. Cheesesteak 4 a. M. Cheesesteak any time ruh geico. Fifteen minutes could save you fifteen percent or more on car insurance. voseeker of the sublime. Ro. You can separate runway ridiculousness. From fashion that flies off the shelves. And you. Rent from national. Because only national lets you choose any car in the aisle. And go. And only national is ranked highest in car rental Customer Satisfaction by j. D. Power. natalie ooooh, i like your style. vo so do we, business pro. So do we. Go national. Go like a pro. So our business can be on at ts network for 175 a month . Yup. All 5 of you for 175. Our clients need a lot of attention. Theres unlimited talk and text. Were working deals all day. You get 10 gigabytes of data to share. What about expansion potential . Add a line, anytime, for 15 a month. Low dues, great terms. Lets close new at t mobile share value plans our best value plans ever for business. 15 minutes left before the closing bell. No sign of a let up in the selloff on this day in wall street. Sheila, what can you tell us . Hey there. We are bouncing off the session lows but still down 1. 5 on the day. Thats the worst percentage drop weve seen since february 3rd. You mentioned indiscriminate selling. Were definitely seeing that here at the nasdaq. In fact, 97 members in the red right now. Particularly getting hit hard are the biotech names. That index is down 2. 5 on the day. The momentum names that led the nasdaq higher, priceline, tesla, all getting hit hard today. Whats weighing down the index the most are the largecap tech names, google, apple, facebook, microsoft. All those are dragging down the index. Again, a big day of risk off. Pretty much everything in the red right now, guys. Sheila, thanks very much. Of course, were going to watch all of these components as we head into the close. A day of conflicting reports. Meanwhile, the search for the Malaysia Airlines jet that vanished last saturday. Still a crazy story. Kier simmons has the latest for us from kuala lumpur. Reporter today left us more confused, frankly. We began the day with reports in the wall street journal that u. S. Security officials had data that showed that the plane had flown for five hours, four hours after it had dropped off the rad radar, if you like. Yet, at the same time, at a News Conference here, the malaysian government, the transport minister an minister and the ceo of Malaysia Airlines said that was inaccurate and the last time the plane had been heard from was 1 00 a. M. In the morning. So directly contradicting the report in the wall street journal. So you have the wall street journals reporting against the claims of the malaysian government. They say they are backed up by the Company Rolls royce that makes the 777s engines. In the middle of all this, of course, are the families stuck now six days in, waiting for news. We spoke today to one man who is the father of a 29yearold, and he says that he is resigned to hearing the worst, but he simply wants to know some news. He simply wants to know what happened. Back to you. Thats kier for us. Of course, the wall street journal has just in the last couple minutes reported a correction to that story saying it was satellite, not engine data based on analysis of signals sent by the boeing 777s satellite communication link, indicating that plane had flown on for up to five hours. Still no sign though. Crazy story. Not a bit at all. About a dozen minutes left to go into the close. The dow is off the lows of the session. We were off almost 250 points. Were a little bit off that, but certainly not by much. This will be the fourth down day in a row. In the mex hour of closing bell, amazon raising its annual prime membership fee to 99. But did amazon leave hundreds of millions of dollars on the table by not raising it even more, as had been rumored . Well get to that story just ahead. Ahead. [ rippling ] [ male announcer ] what if. [ crunching, rumbling ]. It were possible. [ lowpitched scraping, thud ] to capture. [ trilling ] the precision. [ sloshing ] passion. [ lowpitched scraping, thud ] [ whoosh ]. And beauty. That goes into what you do . [ camera shutter clicks ] a better web starts with your website. Create yours at squarespace. Just take a closer look. It works how you want to work. With a Fidelity Investment professional. Or managing your investments on your own. Helping you find new ways to plan for retirement. And save on taxes where you can. So you can invest in the life that you want today. Tap into the full power of your fidelity greenline. Call or come in today for a free oneonone review. At a company thats bringing media and technology together. Next is every second of nbcuniversals coverage 0f the 2014 olympic winter games. Its connecting over one million lowincome americans to Broadband Internet at home. Its a place named one americas most veteran friendly employers. Next is information and entertainment in ways you never thought possible. Welcome to whats next. Comcastnbcuniversal. Welcome back. Heading toward the close, about eight minutes left. The dow coming off the lows. Down 219. The nasdaq with its biggest decline since early february. A decline of 1. 5 . The s p is down 20 points right now. Joining me, my colleagues bob posani and jeff cox. This has been a classic situation where defensive playing have gone higher. Bonds are up on very heavy volume today. Utilities are trading higher and so forth. Clearly a move towards a defensive play. There was a big move in the ten year. We saw the basis move a tenth of a point. Thats a very unusual move. Obviously a move towards the defensive areas. People are saying this is a bad day. It is a bad day, yet i dont see volume through the roof. This will be an average volume day. I dont see the spyder with really heavy volume. I dont see any panic. Thats what i mean. And were hard pressed to come up with a single reason for this selloff, jeff. You can come up with a number of things from china to ukraine to europe and so forth. Ive been watching china all week. Obviously, the copper story is a big thing. There was a report out today from reuters, 20 cutback in lending to some of the industrial sectors over there as they try to cool down their overheated economy a little bit. I just think its a convergence of things. The markets are susceptible here. Im surprised at the cautionary tones im hearing. A note out today talking about the trades. They dont think the market is going to do anything this year. A lot of flat lining. I think this market is just susceptible to headline risk. I agree china is an old story. Those retail Sales Numbers, the Industrial Production numbers were well below expectations. Its now confirming the china slowdown story. But they trumped our own retail sales, which were better than expected. And the jobless claims number was lower this morning. The morning thing with china is when you look at their growth, you see 7 , 7. 5 . That sounds great compared to our growth. But the world depends upon china to have a robust economy. If theyre going to start pulling in their reins a little bit, thats going to be a story thats not going to go away. Its going to make things difficult. One thing thats a little unusual, Angela Merkel, the chancellor of germany, unusually nasty, strong comments about russia, warning it would be a catastrophe if they seized crimea. Shes put in a really uncomfortable position. She was sort of the gobetween with putin. Now shes you should pressureun tighten the reins. Thank you, both. Well see you later. Well come back with the closing countdown here with the dow down about 231 points. After the bell, kelly will be talking to two pros about how General Motors is handling its current recall crisis and if it is now in danger of being compared to the Tobacco Industry two decades ago. Youre watching cnbc, first in business worldwide. Ness worldwi up so were up early. Up late. Thinking up gamechanging ideas, like this dozens of tax free zones across new york state. Move here. Expand here. Or start a new business here. And pay no taxes for 10 years. With new jobs, new opportunities and a new tax free plan. Theres only one way for your business to go. Up. Find out if your business can qualify at startupny. Com no two people have the same financial goals. Pnc investments works with you to understand yours and helps plan for your retirement. Talk to a pnc investments Financial Advisor today. [ bell ringing, applause ] five tech stocks with more than a 10 . Change in aftermarket trading. All the tech stocks with a market cap. Of at least 50 billion. Are up on the day. 12 lowvolume stocks. Breaking into 52week highs. Six upcoming earnings plays. That recently gapped up. [ male announcer ] now the world is your trading floor. Get realtime market scanning wherever you are with the mobile trader app. From td ameritrade. Two and a half minutes left in the trading session. Again, four consecutive down days. This has been the strongest selling weve seen among those four down days. Really, it was one of those days where you couldnt find an uptick for a while. The dow was down here about 200 points for a time. Kind of found a little stability there. Then continued lower. We were down 250 at the low of the session. Down 228 as we head toward the close. What was up as stocks were going lower, Treasury Bonds on a very heavy volume day. This is the kind of volume you would get on a fed day, for example. The yield on the treasury goes down as the price goes up. We were down ten basis points for a while. Here we are at 264, the yield on the tenyear note today. One of the causes we saw today for our own selling, the euro, as mario draghi, the head of the European Central bank, made comments midday, or evening in europe, that were interpreted pretty bearish for the euro. Down it went. Down went our market in a second push today. And were down there. Keith bliss, you cant find any single reason for this selloff here. Does it continue as a result . What do you think is going on here . Youre right. Its a mall ga mags of a bunch of things. When you have a little tension overseas or in the emerging markets like we saw in january, people tend to forget that were still trading near the alltime highs. Why not take the money off the table, live to trade another day. Normally wed see a bounce on the next day. Im not so convinced. Were still not oversold in any of the major indexes, in any were not overbought in any of the bond levels. We are 2 from historic highs on the s p 500. But you have to admit, there was a lot of new data points. When you get these new data points on china worse than expected, when the ukrainian president talks about possibility of war with russia, thats a ramping up of the rhetoric. And when Angela Merkel warns of catastrop catastrophe, thats an amping up of the statements. Thanks, guys. Good to see you both. Were going out just off the lows of the session with the dow down 231 points. As keith said, itll be very interesting to see how we do in the open tomorrow morning. Right now, stay tuned for the second hour of the closing bell with kelly evans and company. See you tomorrow, kelly. Thank you, bill. Welcome to the closing bell. Im kelly evans. Its been a rough day on wall street. Heres how were finishing up. Take a look across the major indexes. The dow finishing down about 230. The s p 500 giving up 21 points today. The nasdaq giving up 62, closing down 1. 5 . Lets get straight to it with todays closing bell panel. For more on todays selloff, our fast money trader, guy. Great to see you all here. Whats going on . Well, i think theres a series of things. To start with the data out of china over the course of the last week has been, you know, pretty scary in the sense that weve had a real hit to things like the shadow banking system, the amount of lending that took place in the month of february. Then you follow that up with the areas where there cheerily has been overinvestment, steel, cement, and electricity production, which is a cleaner read. Youre looking at china thinking, okay, well, theres a bit of a slowdown, but does this run deeper . Is there a credit contraction getting going . So that started things off. Then of course it just evolved into concerns about the ukraine and broader emerging market related concerns. David, what do you think . Why is it that today seems to be the day where all of these concerns are coming to a head . Is it legitimate, or is it in other words, whats forcing the selling here . Markets historically hate uncertainty. Uncertainty is some of the economic acceleration. How much of it is weather related . How much of it is material . World uncertainty. Thats really whats led to todays weakness. But any time you get these selloffs, whether its 1 or something more like 5 or 6 , which i would still, i think, unfold, its a buying opportunity for stocks over the next one to two years. Kate . Kelly, havent we seen moments like this a number of times so far this year . There are these issues that crop up, not to put china in that category, but ill get back to that. And the market is able to digest them. You may see a strong reaction over the course of a day or two days. But i think in general, people are expecting volatility this year. Theyre expecting choppiness. They expect valuations to come down a little bit over the course of the year, perhaps. But overall, you know, theyre optimistic about the economic picture. Were getting data to support that. In terms of china, there certainly are real fears there about slowing growth. I think the feeling im picking up from folks i talked to, the government has the ability to stabilize things if they choose to. I think were seeing some of the wildness in commodities like copper, which did bounce back. Overall, folks i talk to think were okay. Guy, it was so interesting hi. Hi. And i know the market today is behaving more as you expected. You know, conforming more to that pullback. We had the jobless claiming data. 315,000. Thats the lowest reading weve had in quite some time. There werent any apparent reasons for it. Idiosyncratic reasons. The retail sales in february looked okay. Whats going on . Put it in context. We talk about 315,000 like thats some great number. Its great under the scope of what weve had in the last few years, but its anemic when you think about where we should be five years down the road. One thing, and i say it constantly, if you say, the s p is going to be 1850 give or take, where are tenyear yields going to be given that strength . I would have been 3. 5 minimum, if not closer to 4 . The fact that yields continue to hold in here and go lower suggest that maybe growth isnt as robust as we think and maybe the stock markets gotten ahead of where it should be. Thats the camp im in. All the other stuff is just noise. Although, i think the chinese stuff is a pretty big deal, yeah. You know, john fort, it was some of the higher fliers that seem to be the first to drop here over the last couple trading sessions. Really taking it on the chin. What are you seeing now . Thats the pattern, kelly. Thats what looks an awful lot as kate was saying like what weve seen so far this year when we have these emerging markets issues, other geopolitical stuff. You see some of the names that have been flying higher taking it on the chin. Yelp is down. Zynga. One in particular i was watching today was blackberry, which had been on quite a rally so far this year. Its been falling for about ten days or so right at the 9 level, the low. It kind of got near that level but didnt close below it. That tells me people are scared but not kind of in an overworked mode quite yet. Great. Hold that thought for a second. I want to bring in gordon from the floor, whos had a rough day. Gordon, what do you make of it . I think what stands out is we got emotion back in the market here. Lets get rid of some of the risk kind of mentality going on. Who can blame them . You got troops along the ukraine border. You have airplanes missing, buildings collapsing. Theres reasons for guys to sit here and say, you know, maybe its time to lighten the load. You were getting that activity as we were trading. We could feel it on the floor. It was like a frenetic activity that becomes part of the trading environment in situations like this. We havent seen that. You know, weve seen a much more orderly style market today. A little more emotional. Its going to be interesting overnight to see what happens and how the markets respond and, you know, what sort of spillover, what sort of carryover were going to have in the opening tomorrow. I would think were going to continue to see risk off and a little more downside before we start to stabilize. Just to jump in on a point guy was making a moment ago, and i thought i perceived a little bit of a head shake from barry over here. Tell me if you agree. The idea the market is getting ahead of itself. From the folks ive talked to, the fact we have a relatively low inflation situation and strong equities, that feels good to people right now. It could continue for a while unless inflation changes. At least thats what im picking up on. So i dont know whether this is overzealous, but perhaps its in line with where the indicators think we should be. I also know people who think the economy is far stronger than the data indicates. Thats why i raised this up about the u. S. Gdp. If you look at how strong credit markets have been here, youd think the s p was at 2800, not 1850. What do you think . Well, i think if you just step back and go to where we were at the end of the year, wed had a huge surge in cyclical stocks. We had the yield curve incredibly steep. The back end of the treasury market and equity market were discounting exceptionally strong growth. We had some degree of concern at a pullback related to, you know, the weatherrelated growth impairment. The equity market has run ahead of that and is back in the growth and strong camp. Before we had the selloff related to ukraine today, the bell sli of the Treasury Curve was selling off sharply. The next trade is most likely the weather gets better, the data gets better and we worry about the fed. I dont agree with the inflation argument. Whats priced right now is a very benign path for fed rate normalization, and the market is going to check the fed on it. After they change the guidance next week. So i actually think were in a spot where we were about to get to good data is not good, its bad. That will reverberate out likely through the rest of the emerging world. The fact of the matter srt is y struggle with that for several quarters and the market is stuck in a broad range. Up side, downside is 8 sort of thing. If growth remains robust, the up trend will resume. But no time soon is that likely to happen. I think the riskreward sun favorable from a tactical perspective. David, you want to respond to that . Inflation is not a problem today. Its 2 . My rule of thumb is when inflation gets north of 4 , which is a long ways off, then its very problematic for it the real return on stocks. I think were going to get there. Its just a question of when we do. Probably at least a year out. As far as the economy goes, the best grade i can get it, no grade today, is about a cplus. The ism manufacturing index, respectable but not anything off the charts. And this remains from a recovery standpoint one of the weakest recoveries ive ever seen in 30plus years. Yet its been one of the strongest stock market rallies. It has been. Five years, 180 . Cumulative return for the s p. How much is that part of the story . Its valuation expansion, its stocks priced for armageddon five years ago, which we know didnt happen. Markets go higher on fears of armagedd armageddon. Still enough skepticism on stocks that i think they can do quite well. I get most worried when theres euphoria and when people believe its panacea. Were not there yet. Theres a panic euphoria model. It was already in yeuphoria mod. Down to 11 , 10 sort of thing. Thats fairly benign. Every measure other than skew, which is hinting at broader problems. Theres not a lot of space between the two of us. Once you go through this normalization, you start reducing asset purchases. Then well worry about draining liquidity from the system and the rate hikes. That has always caused a period where the market gets stuck in a range. Its never terminal for the bull market. Its never terminal for the economic expansion. But it does cause the market to get stuck for a while. Thats the point that im making. Especially if theres a 20 gain in stocks in the last 12 months. Yeah, for mom and pop at home. I guess the question is, do they need to do anything here . For me, its like were talking about issues in ukraine versus the u. S. Debt limit still. Its kind of nice thats taken off the table as far as big picture macro concerns, right . You buy the pullbacks is what you do, ultimately. But you cant buy a 1 pullback on the highs. You have to buy a 6 , 7 , 8 pullback because if its related to stronger growth and Monetary Policy tightening, thats optim optimal. But this is not a moment to get out. If youre in, you should stay in. From a retail perspective, thats absolutely correct. I would not take money off the table right now. If youre a twotimes leverage hedge fund, i might tell them to cut risk. I thought no one was using leverage anymore. No, theres no leverage anymore. Guy, all this is going back and forth. The bottom line remains. What do you do in this environment . Do you put on any trades . Do you stick with your themes . I think a couple things stick out to me. On days like today, you look at stocks in the green or trading relatively well given the broader tape. A name like jack in the box d y defies logic. Weve talked about it for a while. To me, theres something going on in gold. We mentioned it yesterday. I think the miners look really interesting here. Pete has been talking about that. I think the miners look really interesting. Ill leave you on this. Blind faith was a great band. They rock, but its a lousy way to live life. The whole notion of the federal backstop is a fools errand. Guy, the miners, talk about a beaten down sector. If people leave in the fundamentals, this is a cheap entry point. I agree. Look at new mining today. I think the stock traded really well. Riskreward sets up interestingly in the miners. I think gold is telling you something maybe the market isnt picking up right now. All right. Thanks for now, guy. Catch more of him coming up on fast money at 5 00 p. M. More on the marketings ahead. From bonds to tech stocks, were going to hit todays selloff from all angles. We have our market pros in the pits. Thats coming you have after the break. Also, americans may be experiencing deja vu as more information comes out about General Motors and that recall. The company waited weeks to recall faulty ignition switches. Is gm covering up how dangerous some of their cars can be . Youre watching cnbc, first in business worldwide. [phones rings] its amanda. Hey sweetie. What . Okay, ill send it. One hundred seventytwo dollars for a chemistry book, what is it, made of gold . Just use citi popmoney. Boom. Ah, shes feeling lucky. Hey sweetie. Cancun, yeah no, youll be spending spring break with your new chemistry book. With citi popmoney its easy to send money to just about anyone, anytime. Visit your local branch or citi. Com easierbanking to learn more. Welcome back. Were covering todays selloff from all the angles. Im joined by our allstar market team. Its great to see all of you. Rick, i just want to start with you. How significant a move was it in the tenyear, for example, benchmark treasury yield today . What does that tell you . I think its significant, no doubt. And i always look at important support levels like all of the low 270s. Its kind of like, you know, when you go through it as quickly as we did today, its like pacman, munching support. There can be some permanent damage. But all things being equal, i think theres about five, six basis points today that are crimea related. I think the relate is the real deal china. Lets not forget, a lot of people talking about germany and the ecb. Weeks ago there were many hints that the ecbs next phase is u. S. Style quantitative easing. If you really read draghis comments today, i think thats what hes saying between the lines. Another issue, deutsch bank is down over 4 . Over 4 . And if you look at the dax, for the year its down 5. 5 . Now, that and if you look at the charts, bob for today only. Got to watch these things. Bob, people are going to be looking at that. You overlay whats happened in europe, especially that German Market with the u. S. , and you would think perhaps we go as they go. Why wouldnt that be the case . Its been an ugly five days. Germa germanys at a fivemonth low. Things have heated up on the ukrainian issue. Thats been a real problem. Angela merkel made unusually strong statements today about a catastrophe, potential catastrophe if russia tried to seize the crimea. The whole relationship with europe would be altered by this. Remember, this woman grew up in eastern europe. Excuse me, eastern germany. She speaks fluent russian. It was also secretary kerry and the comments he made that were more strident than people expected. By the way, Goldman Sachs taking down its russian growth from 3 to 1 . That was certainly an issue. But the ramps up of the rhetoric by the ukrainian acting president , warning there could be a war. This thing has gotten a little more heated. I agree with rick. China was the primary motivator. Its clear evidence of weakness. For all that, sheila, the nasdaq was the weakest link. Thats not surprising. The nasdaq is home to the most volatile stocks. I will point out, in the past 30 seconds, both bob and rick have basically outlined five or six different touch points that the markets have been keeping their eyeing on for the past several weeks. Whether its china, europe, crimea. Yes, we saw those heat up today. Traders tell me whats happening is all of those strings are weaving together to provide the selloff. Its been very light volume. Theyre not really concerned quite yet. Theyre saying, look, were not seeing panic selling. Theres a lot of panic questioning. People are still in that questioning mode. You take a stock like google, for example, which is a big supporter of the nasdaq. Its been up over 200 in the past six months. Today its around 18. Yes, a little bit of softness. But traders arent that concerned about it. Youre still seeing solid leadership from the big names. Rick, lets talk about the dollar for a second. For all the flight to safety, if you want to call it, that bid we saw on the treasury market, the dollar index is below 80. The yen is strengthening. Whats going on here . Where is the strength in the dollar . I think the Foreign Exchange markets with regard to the very limited view you get from the euro or the dollar is very easy to interpret. The last meeting of the ecb basically avoided any more easing. Even with the qe comments at bay, we saw the strength in the euro currency. Now we see that reversed a bit because qe most likely is coming. This is going to be a big issue for whether you can ever challenge and get above 140. But the other issue is the dollar index is virtually at the lowest level since october. So if anybody out there thinks that the Foreign Exchange market, particularly the dollar, is where European Investments or asian investments are going to go when you have these geopolitics in the russian area, theyre mistaken. And the dollar yen is the area you want to watch the closest. Yeah, and bob 101. Does that make you if you look at the rally and think, we didnt get that pop in the dollar, what does that make you think here . That could help limit some of the downside . That we still have a ways to go . What are you hearing . No, i dont think thats the big issue. I think rick accurately hit upon the yen as the real key to whats going on here. In fact, the yen strengthening is a major problem for people who have been out borrowing yen for a long time. Today if you look at the dxj, japanese stocks before down. The yen was stronger. Thats a classic unwind there. And that was the key story here. That was the major subtext of what was going on throughout the day. All right. Thats the story to follow for the sessions ahead. Guys, thanks all of you. A rough day out there. Appreciate it. So what did gm know and when did the company know it, and why was this defect spotted back in 2001 and not brought to light immediately . Our own phil lebeau will join us with that important story next. And William Sonoma trading at an alltime high today. Ill be joined by the Ceo Laura Alber to discuss those results and the customer. Stay tuned. Stay tuned. Thats right, no hidden fees. Its just that im worried about, you know, hidden things. Ok, whys that . Well uhhh. Surprise um. Well, its true. At ally there are no hidden fees. Not one. Thats nice. No hidden fees, no worries. Ally bank. Your money needs an ally. Tdd 1888648602121 tjust waiting to be found. Ties tdd 18886486021 at schwab, were here to help tdd 18886486021 bring what inspires you tdd 18886486021 out there. In here. Tdd 18886486021 out there, tdd 18886486021 there are stocks on the move. Tdd 18886486021 in here, streetsmart edge has tdd 18886486021 chart pattern recognition tdd 18886486021 which shows you which ones are bullish or bearish. Tdd 18886486021 now, earn 300 commissionfree online trades. Tdd 18886486021 call 18886486021 tdd 18886486021 or go to schwab. Com trading to learn how. Tdd 18886486021 our trading specialists can tdd 18886486021 help you set up your platform. Tdd 18886486021 because when your tools look the way you want tdd 18886486021 and work the way you think, you can trade at your best. Tdd 18886486021 get it all with no trade minimum. Tdd 18886486021 and only 8. 95 a trade. Tdd 18886486021 open an account and earn 300 commissionfree online trades. Tdd 18886486021 call 18886486021 to learn more. Tdd 18886486021 so you can take charge tdd 18886486021 of your trading. Welcome back. Seems like each day that passes since the original General Motors ignition switch recall, a new piece of information emerges. Information thats been bad news for the company. Phil lebeau joins me with the latest. The latest is that General Motors knew about potential problems with the ignition keys long before they initially told people about this when the recall was first announced. In fact, General Motors now says that the first indication there may have been problems with the ignition keys was back in 2001. Remember when this recall was first announced, they said it was 2004. Now it turns out there was information three years before that. The national Highway Traffic Safety Administration did three crash investigations over the last ten years, and yet there had not been a recall. 240 complaints over those last ten years before a recall was announced in february. General motors ignition repairs are scheduled to start next month. In the meantime, both nitsa as well as General Motors are emphatic in telling customers use only the key or the key fob. Not a lot of keys on the key chain. Heres the transportation secretary in washington today talking about the importance of following that warning. Im encouraging folks to follow the requests of gm at this point. I think thats the smartest thing for folks to do. Folks should be safe if they follow what gm has told them to do. A lot of questions today on capitol hill for anthony foxx, especially from senators wondering why nitsa did not do more. As you look at shares is of General Motors, now that its trading at that 34 mark, we havent seen it at this price since october. Its given up a lot of ground over the last four months. Kelly . Phil, it certainly has. Please stay with us, if you will. We want to bring in the managing editor at reuters. He won a Pulitzer Prize for his coverage of gm while at the washington journal. What surprises you about this story . Well, inthis is going to get worse before it gets better. Certainly it is surprising that new revelations keep coming out. You have the unholy trinity now. You have new investigations, new revelations, and you have the press sort of jumping on the story. So if past pattern proves accurate here, itll get worse before it gets better. It certainly is no financial threat to General Motors. But its going to drain a lot of management time, a lot of Senior Management time when they have a new ceo. And its also a Reputational Risk. Well have to see how for a that goes. If its not a financial risk, why have their shares been hammered since these revelations first took place . Well, its not a financial risk. They can absorb the litigation settlements and this sort of thing that theyre going to face and the cost of the investigations. It is a Reputational Risk, though. The Reputational Risk could eventually, you know, over time cost them sales. You know, market share in this industry is not easy to come by. Companies claw for onetenth of a percent of market share. This could damage their sales image, certainly. Phil, do you think thats fair . Keep in mind, kelly, that this 2014 was supposed to be a huge year for General Motors. They told everybody about that in advance. They have a slew of new models coming. You have mary barra coming in. They were set to do great things this year. Even analysts were saying, look, these guys are prime to go much higher. Now this stock is basically dead for a while because there are no catalysts on the horizon. Nothing is going to happen over the next couple of months. You have questions about the pickup line and whether or not its fresh enough as it goes up against ford and ram. All of that together means a lot of investors are stepping back and saying, we think gm will go higher at some point. We just dont think its going to happen any time soon. Paul, do you think these comparisons to tobacco executives in the late 90s are fair . No, i dont, honestly. Theyre way overblown. Look, someone in General Motors really blew this. Theres investigations underway. Even a criminal investigation by the justice department. Well see what that shows. This is not some sort of a longstanding Health Threat that was widely known and deliberately covered up, i dont think. Well see what happens. But this is the tobacco thing is way out of line. What do you think, phil . Same . Yeah, i would agree with that. I think in the tobacco case, if you go back and look at those cases, they knew. They knew that it was a health risk and that they were purposely keeping it hidden. I dont think that General Motors knew that this was a defect that could kill people, that they were saying, dont let it get out there. I think this was a case where they looked and said, maybe we can handle this with some Service Bulletins and that should take care of everything. Over time, they did not fully grasp the enormity of the situation. If they knew years before they had previously indicated this was a problem, it appears but kelly, the difference is they thought Service Bulletins would take care of this. Thats the difference here. You look at the Tobacco Industry, that was a case where they purposely kept it hidden. The Service Bulletins were sent to the dealerships. You can argue fairly whether or not they did enough. A lot of people are saying no. But they did issue these Service Bulletins. Got to go, but paul, is that going to be enough to protect them from further lawsuits and damages . Well, no. Theyre going to have a lot more lawsuits. Theyre going to have problems on this. And look, the government bears some responsibility here too. Gm cannot point the finger at the government because you cant alienate the people who regulate you. Bad strategy. All right. Paul, phil, thank you both. Gm shares under more pressure today in this market. From Kitchen Gadgets to outdoor grills, William Sonoma is one of the leaders in home essentials. The stock is trading at alltime highs today after better than expected earnings. Ill be sitting down exclusively with the companys ceo. Were back in two. Announcer where can an investor be a name and not a number . Scottrade. Ron im never alone with scottrade. I can always call or stop by my local office. Theyre nearby and ready to help. So when i have questions, i can talk to someone who knows exactly how i trade. Because i dont trade like everybody. I trade like me. Thats why im with scottrade. Announcer ranked highest in Investor Satisfaction with selfdirected services by j. D. Power and associates. Sometimes they just drop in. Always obvious. Cme group can help you navigate risks and capture opportunities. We enable you to reach Global Markets and drive forward with broader possibilities. Cme group how the world advances. So our business can be on at ts network for 175 a month . Yup. All 5 of you for 175. Our clients need a lot of attention. Theres unlimited talk and text. Were working deals all day. You get 10 gigabytes of data to share. What about expansion potential . Add a line, anytime, for 15 a month. Low dues, great terms. Lets close new at t mobile share value plans our best value plans ever for business. Welcome back. Lets go back to headquarters and get the latest on todays biggest movers. Dom . Kelly, lets talk about shares of aeropostale after the specialty retailer posted weaker than expected Fourth Quarter profits. This this case, a loss. The company entered into a 150 Million Financing arrangement with sycamore partners. A different story for ulta salon. Better than expected Fourth Quarter profits and sales. Instore sales increased by over 9 . That stock is up in the after hours. Mattress firm beat earnings by a penny with revenues in line. That stock showing a little bit of strength in the after hours as well. Then theres bp, gaining ground. The oil company is winning the end of a u. S. Contract ban tied to the 2010 gulf oil spill. Its now going to be able to bid on federal contracts and leases in the gulf of mexico. And were going to end with William Sonoma, bucking todays downward trend. They posted better than expected Fourth Quarter profits and it raised its Quarterly Dividend to 33 cents a share. Probably due in no small part to my patronage to their stores. Great, dom. Thanks very much. Lets talk more about William Sonoma and whats next. Joining me now exclusively is Ceo Laura Alber. Look at that stock price action today. Welcome, by the way. Thank you. Youre up 10 . How did you manage to increase sales so much during a period at the end of the last year where we know u. S. Retail sales more broadly werent that hot . We have a lot of things that are coming together at once. Were so fortunate to have a company that has multiple brands. And we have ecommerce close to 50 of our total company revenues. I think when you combine that with proprietary product and a Great Service equation, you know, the customers clearly respond. What can you tell us about january and february trends . You know, we launch in january a lot of new products across all of our brands. We see a real focus on healthy living. Our color palates have been met with good response from our custome customers. Broadly speaking, did you see any slowing from december to january in line with the market weakness we saw in the weather . Very different time periods. One is gifting and decorating. January, we think about redecorating our homes and refreshing our living spaces. We also know that a lot of people are very interested in remodeling. Those are all trends that are real. Of course, for sonoma, the wellness trends are something weve really been bringing to life in our stores and online. The customer has responded. You have brands that include the flagship store, selling a lot of cookware. You have the pottery barn names that are strong as well. Youre exposed in a lot of ways to the u. S. Housing market at a time when theres questions about how strong this space will be. What do you think is happening here at the start of the year . Yes, a lot of mixed news, isnt there . What i think is most relevant for our business is that people are not losing value in their homes. That makes them feel more confident in spending money on them. Thats the business that were in. And what about expanding beyond the u. S. To other International Markets . We see it as a big opportunity. Theres no one doing what were doing overseas. And so were approaching our Global Expansion in a disciplined way but realizing that theres big opportunity to bring our brands around the globe with the same Great Service equation and also whats important to us as we expand globally is going in with a multichannel presence. Were launching fully integrated ecommerce websites as we open stores. Even as were seeing the loss of so many traditional brick and mortar stores, youre already talking about 50 of the business being ecommerce. How are you splitting your investment between the online and the bricks and mortar portion . And how many more stores do you ultimately expect to add . Good question. You know, we are very focused on our customer and customer service. We know that the channels Work Together to serve the customer. So our stores are really billboards for our brands. That Great Service we give in the stores makes you feel more confident to shop online. We are making investments based on customer impact. What about the cost of the business . Because i imagine labor is a huge part of it. Again, day after day from washington its raising the minimum wage, its raising overtime pay. What impact does that have . You know, people are our greatest asset. We are so fortunate to have such a strong team. I think its a core dimpb sha to be. We know that happy employees give Great Service. We are looking at ways to continue our strong pay for performance culture and be competitive. So in other words, you dont see this we just had a couple cfos on the program earlier. One said he thought raising this was good for the country because its more income to spend. The other said its going to have a negative impact. Theres a lot of different opinions about it. For William Sonoma, were focused on pay for performance across all of our areas and in our field. The people who work in our stores are so important to us. Were looking at ways to increase their incentive pay. Lauerlaura, thank you so muc. Have a good one. Breaking news on jobless benefits. Hampton . Kelly, a deal, a bipartisan deal apparently has been struck in the senate to revive and extend those expired longterm Unemployment Benefits that expired at the end of the year. The deal crafted by a group of ten senators, a Bipartisan Group group, will extend the benefits for five months. The key to cobbling the deal together is it is, in fact, going to be not only reauthorizing unemployment insurance, but its also going to be paid for using a combination of offsets that include pension smoothing and provisions from the highway bill. That was a key thing to get republicans on board. So again, a deal to revive and extend those expired Unemployment Benefits has, in fact, been crafted by a group in the senate. It could be officially unveiled as early as tomorrow. Then well see what happens as far as getting those 60 votes on the floor of the senate to make it official. Okay. Hampton, thanks very much. Pension smoothing, i love it. Hampton pierson out of washington. Amazon jacks up the cost of its prime service by 20. But did they lowball it . Our panel weighs in on whether consumers would have been willing to pay for or if the increase will hurt membership numbers. Stocks again posting an ugly down day across the board. If we go lower tomorrow, it will be the First Time Since may of 2012 weve had all five down days. How likely is that to happen . Stay with us. Well be right back. [ male announcer ] what if a Small Company became big business overnight . Like, really big. Then expanded . Or their new product tanked . Or not . What if they embrace new technology instead . Imagine a companys future with the future of trading. Company profile. A Research Tool on thinkorswim. From td ameritrade. A Research Tool on thinkorswim. Iwe dont back down. We only know one direction up so were up early. Up late. Thinking up gamechanging ideas, like this dozens of tax free zones across new york state. Move here. Expand here. Or start a new business here. And pay no taxes for 10 years. With new jobs, new opportunities and a new tax free plan. Theres only one way for your business to go. Up. Find out if your business can qualify at startupny. Com sunny or bubbly . Cozy or cool . Meow or woof . Wheels or wheeeels . Everything exactly the way you want it. Until boom, its bedtime. Your mattress isnt bliss its a battleground of thwarted desire. Enter the allnew sleep number classic series. Designed to let couples sleep together in individualized comfort. Starting at just 699. 99 for a queen mattress. Hes the softy his sleep number setting is 35. Youre the rock your setting is 60. That works. Hes the night owl. His sides up while youre in dreamland. Youre the early bird. Up and at em. No problem, because youre in it together. Keeping the love alive. And by the way snoring . Sleep numbers even got an adjustment for that. Crazy . Only if sleeping peacefully with your soulmate is crazy. Find your sleep number setting only at one of our 425 stores nationwide. You can afford a sleep number bed, you cant afford another mediocre nights sleep. Know better sleep with sleep number. Welcome back. Amazon stocks spiking on news its hiking its prime membership up to 99 a year. Josh lipton has more on the story. Kelly, if you are an amazon prime member, get ready to pay more for those packages and movies. Amazon prime members, like myself, got an email saying next year their annual membership fee is going to jump from 79 to 99. Amazons prime Service Offers members free twoday shipping on 20 million items as well as streaming videos. The news wasnt a surprise. Remember, the company had said it was considering such an increase on their q4 call. The price of prime has remained the same for nine years, but fuel, transportation costs have gone up, so amazon decided to raise the membership price. Could amazon have raised it even more . Maybe not. Ubs, in a survey conducted in february, found that 99 appeared to be the limit of what prime members would be willing to pay for that service. Its estimated there are 23 million prime members. Thats about 10 of amazons customers. If they were all to renew over the next year at 99, that could lead to 500 million in incremental revenue. Amazon thinks of prime membership as a big growth opportunity. Those members are estimated to spend four times as much as nonmembers. Kelly, back to you. All right, josh. Thanks. Investors cheering the price hike because it could add some 400 million in yearly revenue. Did amazon leave money on the table . Is the service so popular customers would have paid even more . John fort, would you have paid more . Yes, i would have. But im a ridiculously high prime user. 30 purchases from amazon so far this year. Yes, they could have charged more, but they would have put the brakes on their growth a bit. Both in media, which is covered under that, and just in general. They want to make somewhat of a volume play. Could they have done this earlier . Sure, they could have. But investors didnt need them too. If theyre about to go into a Margin Expansion mode, now maybe is the time to do it. Lets go to todd. He thinks they could have done this a while ago as well. Todd, is it because they didnt do it sooner now that you think they missed the opportunity there . No, i dont think they missed the opportunity. Well, sure, they could have raised it sooner back as far as 2011. We already had instant prime, the official service with all of the tv shows and movies. Adding on top of the Free Shipping for two days and everything like that. I think what we need here now is take this 500 million and put it into new services. I think were going to see amazon settop box. Another reason prime subscribers should continue paying that 100. I think well see a smartphone enter the market this year. Another reason for amazon to enter the Hardware Market and do what theyve done with the kindle and break even on the hardware but sell the services. Just to be clear, do you think they should have raised the price even more . Yeah, i think they could have gotten away with it. Look at the netflix model. 7. 99 just for streaming movies. David sourby is a user of amazon prime service. Maybe going over 100 would have been too much for some people to digest just from the headline point of view. What if they did more of a netflix model where you paid by the month . Maybe they could change that a little bit. Are you willing to pay 99 . Would you pay more . Time is something ill never get back. Time sensitivity, thats important. Its not very price sensitive. In economic terms, price elasticity is in favor of amazon. As far as the companys strategy, all we have to do is think about the last ten years and creating shareholder value. Amazon stock has compounded the last ten years at 24 annualized return. The s p, 7. 5 . Thats about three times what the market has. That is truly delivering shareholder value. I think this is just another strategy would you pay 250 a year for it . Would you pay 500 or 1,000 . I put great value on time. I definitely am willing to pay 25 higher today than i did yesterday. Kate, what do you think . I have to confess. I dont use amazon prime. Im super frugal about stuff like that. I thought even 79 was too expensive. They automatically enrolled me at one time. I actually unregistered myself. I do really like their subsidiary unit, diapers. Com and those related sites. They deliver very quickly without the surcharge. I use amazon, but in those cases, i tend to have a long leave time and just do the Free Shipping that way. I think thats the reason they cant raise it too much. Those of us who are power users, yeah, we probably pay twice as much. But they need new people. If youre just asking them for 150 up front and see what i do for you down the line, theyre going to say, no thanks. I think they could have gotten away with it if they broke it into a monthly model. If you increase it slightly each month, people arent going to look at it as that big bulk figure. Yeah, they could have gotten away with it, but every additional buck, you have some cost in terms of what your growth is going to be. Right now, whos really looking for profit from amazon . Thats not what investors are expecting. Theyre expecting topline growth. Maybe they give them a little bit extra profitability now. I think thats a very good point. Im enrolled in netflix for the cheapest plan. I think 7. 99 a month. I hardly think twice about that, yet i hardly use it. I think theres something about a monthly cost that seems low. Uhoh, netflix. I just tipped off amazon how to get to me. Kate might be cancelling when she gets home. Heres a different perspective. China was a major force for disinflation of consumer goods in the 2000s. Amazons been a major force for disinflation for at least ten years. If they actually are able to raise prices, expand their margins, what does that tell you about the outlook for Consumer Price inflation Going Forward . I wouldnt disagree with david that the outlook is reasonable benign over the long haul, but i think some degree of disinflation is ebbing. This might be another sign of it. We might find ourselves at the feds 2 target a lot faster than people expect. But theyre still dropping prices on web surfaces. Fort, why did you have to rain on the amazon indicator parade . I love it. Thanks, guys. Thank you, todd. Thanks. What stories are heathing up at cnbc. Com . Were bringing you the hot list next. The selloff probably has people clicking. Well find out right after this. Make it happen with fidelity active trader pro. Its one more innovative reason serious investors are choosing fidelity. Call or click to open your fidelity account today. Call or click to open your fidelity account today. Phone your account is already paid in full. Oh, well in that case, back to vacation mode. Boots and pants and boots and pants and boots and pants and boots and pants and boots and pants. Voiceenabled bill pay. Just a tap away on the geico app. Huh, 15 minutes could save you 15 or more on car insurance. Yup, Everybody Knows that. Well, did you know that some owls arent that wise. Dont forget about im having brunch with meagan tomorrow. Who . Seriously, you met her like three times. Who . Geico. We still run into problems. Thats why Liberty Mutual insurance offers accident forgiveness if you qualify, and new car replacement, standard with our auto policies. So call Liberty Mutual at. Today. And if you switch, you could save up to 423. Liberty mutual insurance. Responsibility. Whats your policy . Welcome back. What is atop the hot list right now. Allen wastler. Imagine this selloff has people clicking, though . Its been crazy all day. The market has been the story. We had jostling in the last few minutes with the new Senate Agreement on Unemployment Benefits. But its still the market dominating. Ive had spike alerts on our traffic all day long. Were leading with art cashin, the ubs floor director. Always the wiseman. Hes talking about Technical Levels people have to look forward to in the next few days. He says they got a lot of damage today. He said it in an interview with our futures now team. He lays out that the s p would be tested again with all of the ukraine stuff. We have a lot of readers piling into our market coverage over 250,000 already. And theyre still piling in. People go, what happened . So, our markets editor laid out that out, looking at what happened with the data out of china. And fears about the ukraine coming in and that also did it. Finally, cleaning up the top three here. We have dr. Doom, mr. Farber, of the doom and groom report. You know how you had that overprotective mother who said, if you keep doing that, youll poke an eye out. He did an interview saying, the market kept going as a bull. Never correcting. And now look whats happening. If you dont correct now, youll get big pain later. People eat up his comments. Theyre diving into that. Very busy day on the website today, kelly. Thank you for walking us through it. Have a good night. Take care. The dow in danger of going 0 for 5 the this week. More on the big drop in markets today. S today. No two people have the same financial goals. Pnc investments works with you to understand yours and helps plan for your retirement. Talk to a pnc investments Financial Advisor today. Tdd 18003452550 life inspires your trading. Tdd 18003452550 where others see fads. Tdd 18003452550. You see opportunities. Tdd 18003452550 at schwab, were here to help tdd 18003452550 turn inspiration into action. Tdd 18003452550 we have intuitive platforms tdd 18003452550 to help you discover whats trending. Tdd 18003452550 and seasoned market experts to help sharpen your instincts. Tdd 18003452550 so you can take charge tdd 18003452550 of your trading. Return on investment wall isnt a street. Isnt the only return im looking forward to. For some, every dollar is earned with sweat, sacrifice, courage. Which is why usaa is honored to help our members with everything from investing for retirement to saving for college. Our commitment to current and former military members and their families is without equal. Impact wool exports from new zealand, textile production in spain, and the use of medical technology in the u. S. . At t. Rowe price, we understand the connections of a complex, global economy. Its just one reason over 75 of our mutual funds beat their 10year lipper average. T. Rowe price. Invest with confidence. Request a prospectus or summary prospectus with investment information, risks, fees and expenses to read and consider carefully before investing. Welcome back. Today marked the fourthstraight down day for markets. And if tomorrow is in the red, it will be the First Time Since may of 2012, the dow will have lost ground for a fiveday session of the week. Does that mat center. I dont get carried away with statistics. But the risk reward is unfavorable. If growth gets better, were going to worry about the fed. You know, the dynamics in emerging markets will flare back up. The market has priced very strong growth. We may very well get it. You see this as a flipside you know the winwin environment. You can argue that the environment from the crisis to now. Either theres a fed with stronger growth. Thats both good for markets. Are you saying were at a loselose kind of point . Were in an adjustment of fed policy. This has resulted in a couple of quarters, where the market has struggled. Once you get to the other side, the normalization has worked its way through. The uptrend will likely resume. But i dont see that happening for the next couple of quarters. What should we be watching here, david . Especially with regard to the very near term, what happens tomorrow . Watch the consumer. If gdp growth is going to be 3 and Earnings Growth will be 8 to 10 , then i think you need Consumer Spending north of 3 . Todays retail Sales Numbers were mediocre at best. Im going to watch the consumer more closely. Positively, i look at Corporate America. Their use of cash. The generation of free cash flow. And the valuation im paying on those companies. Im pretty bullish on where equity markets are going to head. Not just this year but the next couple years. Even though barry laid out the reasons no. Theres no space between us. I agree with him. Im overweight industrials. Theres time to get everybodys Blood Pressure higher. Maybe its a year or two if the fed overdoes it. But todays not the day to get us all too nervous. Were in agreement with that. Im curious to see if things are going to settle out tomorrow. Lets see how the open goes. And see if if the negativity dispels going into the weekend. People are going to be watching china and japan closely overnight. And europe. Weve seen a lot of pressure on the u. S. Session lately. Even more eager to get oracles numbers, which are coming next week. Thats a big enterprise tech name that reports out of cycle for tech. Knave got a big business in europe. Well get some insights there. Whats the readthrough, if you had to say, from a company like oracle . An important part of my thesis, that Capital Spending will be a big driver through this business cycle. So, enterprise tech is a key element of that. Big multiline industrials. And enterprise tech. We get the cyclical recovery because of all of the policy uncertainty. And you overlay that into a strong secular case. The 20year wage disinflation and the like. Thats key. Oracle is a pretty good benchmark for all of that. Thanks for being here on this crazy day. Fast money coming up. Scott in for melissa lee. Were going to talk about the selloff and the reasons for it. Also, a big move in yields told. You follow that closely. That will go down on the tell on this day. The big story is this big drop in yields on the tenyear, especially. Yeah. Some pretty heavy volume. Over to you guys. Fast money starts right now. Live from the Nasdaq Market site in new yorks times square. Im scott wapner in for melissa lee. Our traders, steve grasso, guy adami, karen finerman. And tensions in ukraine, sparking a selloff and its not just equities. The tenyear treasury yield seeing its biggest drop in two months. Copper seeing its lowest close in almost four years. Is this the beginning of a bigger pullback. Steve grasso. What was