Transcripts For CNBC Closing Bell 20150203

Consumers but the opposite still seems to be the case. This market likes it when oil is moving higher. Last thursday lets all recall oil hit a low of 43 and change. Now were almost 10 above that right now. Almost 25 gain. I will mention Brian Reynolds just hitting the tape saying he thinks this will help stocks fend off some of the weakness we have seen wreryeartodate. There is certainly a lot to watch. Not clear at all just what this move will even. Aetnas sew Mark Bertolini is joining us in an exclusive interview. Why theyre raising their outlook plus well ask him to weigh in on the controversy. The vaccine story was a big part of the show yesterday with kellys interview with senator rand paul. Disneyland in california was kind of ground zero for the measles vaccine debate with that scare out there. Bob iger will be here after his companys earnings are released tonight. Well get his take on all of that. Im sure im sure that bob will have something to say about that. Here is where we stand in the markets with an hour to go. The dow is up 274. The nasdaq look at the s p first of all. The nasdaq is the laggard on this session today. Watching oil here moving higher up almost 10 , 10 lets say in just two trading sessions. Lets goat to the closing bell exchange. A lot to talk about with our guests. Jennifer veil from u. S. Bank is with us today. David kudlow from mainstay capital management. Jeff taylor from digital risk. James lew from Jpmorgan Funds and our own Rick Santelli joining us as he usually does. David, what do you make of this gain in oil . I notice you tweeted about that a little while ago. Well its interesting that investors are placing and the markets are placing so much emphasis on which direction the market should move based on what oil is doing and i think making too much of it. Were looking at how much of this is supply how much is demand and i think these movements in oil day to day have nothing to do with true price discovery, have very little to do with the comply demand equation. There are a lot of forces that move the market and investors are making too much of it. I dont think that the rise from 43 and change to 53 has anything more to do with Global Demand, the Global Growth story, than when it fell by that amount. I think thats what investors need to keep in mind. In some ways the fixed income market is shaking this off. They really havent moved higher. Is that because of some of the remark today or what is going on there . Its certainly possible that some of the remarks have caused yields to pop up a bit, but, frankly, i think it is partially due to oil. I think there is some concern, especially in some of the credit markets around liquidity in the Energy Related sectors and i think this is providing some additional liquidity and some Additional Support for credit. So that generally makes those safe haven assets tend to rise in Interest Rates. So i think its a combination. The comments and the rally were experiencing. James, lets not forget about earnings. The lions share of the season is behind us but theres still much more to come. Well hear from disney tonight. What do you make of what weve heard so far and where do you see the market going . I do think its overreacting to the oil move. What you want to see is stability in oil prices not necessarilyy lyily an increase. Specifically to earnings the Energy Sector has been the biggest detractor of earnings over the course of the quarter. Its gone down by 30 . You also have a stronger u. S. Dollar. So i think the street estimates are still a little too lofty in terms of earning expectations. We think on a yearoveryear basis, you could see in the Fourth Quarter a 2 decline in corporate earnings. James, how much emphasis do you place on the comments from the minneapolis fed president he said the fed shouldnt raise rates, they might have to go back to qe if inflation doesnt pick up here. James . I absolutely think that they need to start tightening in march. Were talking about emergency levels for the fed funds rate. Were not talking about whether we should raise it from 0 to 4 . Were talking about 25 basis points. I understand his comments but i would be more inclined to be in line with jim bullards comments with last week that we need to get the ball rolling on rate hikes. Rick, was that you laughingsing laughingsinglaughing . Of course it was. Do you think anybody out there in tv land really thinks if things stay spongy which is most likely the new normal they wont do the abnormal thing of doing something they have done four times that really hasnt had the desired results . They will. As for oil, i want to weigh in quickly. All you technicians out there, look at the spike high from the 15th of january in crude oil front month at 5127. The fact we traded above and closed above it its the first major technical sign i can give you were working on a bottom formation and that 5127 will be a pivot. As far as Interest Rates, weve had some major reversals here. The flattening of the curve has given us three areas of the curve to watch. 5s, 10s, and 30s. And the 5s never traded below their intraday yield from the famous october 15th. They didnt get below their yield from the 15th of this month as all other maturities did and now they have all reverse reversed. Call it what you will but a big reversal in the eurocurrency, reversals across the board in Foreign Exchange and the reversals in Interest Rates, this could be a shortterm development, maybe nothing long term, but it could be a rip your face off selloff in treasuries if yields start to move much higher. Jeff taylor do you think thats a risk here . That yields move higher . I think to ricks appointments, look at all the oil stocks on the rise. I think thats getting lost in a more Macro Economic environment theyre pulling back on production which means wage rates will continue to go down jobs could continue to be lost. So when i take a step back and say whats it doing for the broader economy, the Oil Companies may be going up a little bit, how is that going to relate to wage growth . People having Discretionary Income to jump start the Housing Market . Its still at a tenyear low right now. When are those millennials coming back to the market . Who would have thought a year after janet yellen basically announced qe would come to an end six months later we would still be looking at the best time in our history from an Interest Rate perspective to buy housing and its still flat. Davidk kudla, you know you like europe. Do you like it because the dollar is going higher . Because the dollar has been beat be down . Give us your rational e right now. Rick is going to love this but the republican i likeason i like europe is because of Mario Draghis quantitative easing program. I wont get an argument from rick except to say qe doesnt do anything. We dont know whatq qe does for the real economy. What we know it does is inflate asset prices. We believe for that reason well see Europe Markets doing well this year. They have problems with structural reform. Greece has a plan that may or may not that troika may or may not buy off on. We haveq qe we have liquidity. And it is a global race to the bottom. Theres qe in europe so we like europe for that reason. Jennifer what about you guys here on the rate picture generally speaking . We did have australia the latest to cut rates overnight. Yeah. There is certainly globally downward pressure on yields but actually thats why were seeing additional monies move into our market. Relative to most of the q10g10 currency and debt our market lets more attractive. The comments he is one of the few members that hasnt come out and said theyre on the path to normalizing the policy rate by midyear. This level of unemployment, this level of inflation, it certainly justifies some level of accommodation but it does not justify an emergency zero Interest Rate policy. Last to james liu again, youre the global strategist there. Do you like europe as well . Do you like what you heard from david . I do like europe right now. I do agree theres sort of this disingenuous trade where you would trade based on the ecb providing some cyclical pop. When we look at the economics, we think austerity is declining across the region which should help growth and, in fact if you look at pmi indicators or Manufacturing Activity they seem to be holding in there. It looks as if there is going to be stability. Im relatively positive about the situation so i do like europe for the rest of 2015. All right. Well theyre liking u. S. Stocks today as well. Thanks guys. We have about 50 minutes into the close. A strong day across the markets. The dow is up almost 270 points. Thats good for 1. 5 . The s p is up better than 1 or 23 points and the nasdaq is in positive territory as well by 36 points. And i have no idea how were going to fit all of this in in the next two hours. Jampacked show heading your way. Disney, chipotle gilead wynn resorts leading the charge with earnings. Well have the numbers the second they hit the tape the instant analysis and the market response. Also joining us the ceos of disney, ryder, and aetna. Well well be back in two. Stay with us on the closing bell. Rally day and some of this i guess we are attributing to the gains in oil with the big gains there over at the nymex. The dow is up 1. 5 right now. Thats the big gainer as you can see. And of the secretarytors were seeing, utilities suffering as Interest Rates moved up but energy the leading category in the stock market today for gains. And our dominic chu is following some of the biggest movers in the session. Hi, dom. Kelly, bill lets sart with whats happening with lear. Kate kelly reported fund activists are urging the company to split in two. Lear responded by saying its going to evaluate the proposal. Shares up by 5 . Big Oil Moving Higher on the back of rising oil prices. It surged 7 oil prices. Its highest point of 2015. The year is still young. Airlines took a hit on the rising oil prices. That inverse correlation holding true today. And were going end with aetna shares gaining ground after the Company Raised its full year outlook. It said its seeing membership and revenue increasing. Up 1. 66 . Thanks very much. Joining us to talk about earnings chairman and ceo Mark Bertolini. I hope the snow is staying away from you. Hi bill. Hi kelly. So far so good. So youre raising guidance for the rest of the year. How much of that is obamacare . Not a lot, but it does provide some tailwind for us. We ended the year last year in the commercial sector and in medicare and medicaid rather strongly, and we start into 2015 with strong growth in Medicare Advantage again but also we have seen strong growth in the public exchanges but the public exchanges and the individual market only represent 6 of our 58 billion in revenue. Wow. Mark, im also looking here at other drivers from the quarter. You had this deal with gilead. You backed their hep c treatment. What can you tell us about what youre seeing . Were seeing higher scrips in the Fourth Quarter. As new drug regimens evolve, it provides an opportunity for people to make a choice but more importantly provides an opportunity for us to get the best pricing available so people can get access to treatment. We think our contract with gilead on this drug will provide a 10 cent tailwind next year in 2015. And can you tell us how much of a discount it is . Are we talking 30 , 40 , more . Our drug contracts are proprietary and confidential so we dont share that information. You know the vaccine issue is very much in the news right now. Its been a political issue for the most part but lets make it a business or heaven forbid lets mick it a health issue right now. Whats your view . The president and the speaker both today said exactly the same thing. They think that all parents should get their children vaccinated, among other things for measles but they dont think there should be a law mandating it. Whats your view and especially as it would pertain to your business if there should be a god forbid an outbreak of some kind. Well i was vaccinated, my children were vaccinated, so personally i believe in it strongly. I think its a Public Health issue, and i dont think we can force people but i think we have options in both the workplace and the schools so enforce some regimen around vaccines. So i think thats where we ought to handle it and by the way, thats an issue thats beyond my reach, but i think an important one. It is a Public Health issue, a big Public Health issue. Mark another issue within your reach, you just raised salaries for lower income workers at your company. Whats been the reaction internally and how much of an impact will that have Going Forward . It was overwhelmingly positive. For the company its a 25 million run rate expense out of a 10. 2 billion xrat b operating number. We have 120 120 million in turnover. We think its a good investment. But more importantly, its an investment for our consumers that are now buying health care on a retail basis and the very people were impacting inside the company are the people that take care of those customers. So we think its an investment in infrastructure for the company and for our customers. Why not raise it more mark . Just curious . We gave everybody as high as a 45 increase in personal disposable income. We think thats a good start. Certainly. You have long been sort of a window for us to watch the evolution of the Affordable Care act, and one wrinkle thats coming up now, a friend of mine told me hes a tax preparer said watch this. And there are some problems cropping up right now. People not knowing about their tax credit maybe having to be refunded or increased. And other issues. What do you make of how its coming . There are bugs in the system still and what do you see enrollment doing down the road here . Well i think enrollment the numbers that the administration are putting out, it will be something around there. We have seen an increase from 600,000 last year to 800,000 this year in total enrollment for our own population. I think we have a number of shoes dropping. Right now people are getting their first bills, and their subsidies changed. Depending how rates changed, the subsidies are changing and then they file their tax returns and that will have an impact on their tax returns. I think that is just way too complicated for people to understand and we need to find a better way to help people understand what their personal financial liability is around their health care and right now this isnt going to work well. Any suggestions . Well, there are a number of ways we can structure it. Weve had those conversations with the administration and with cms. We have some work to do and i think the coming congress and some conversations that will result as we move forward over the next couple years will bring some of those ideas to light. I dont want to get in front of our conversations in washington. Mark also curious whether Health Care Costs generally are increasing or decreasing in terms of the pressure youre seeing. We know the inflation rate has slowed a little bit but your own Health Care Costs are up more than 13 in the quarter. Are double digit increases going to be the norm for here on out . Were seeing in trend, which is just part of the cost increases, about 6 to 7 in trend this year. And so we still think that is low, but were always anticipating that as the economy comes back well probably see be a increase in use as people get more personal disposable income, dont have to make the tough choices they have over the last couple years. We do see the potential for costs to increase more than theyve in the past. Always good to see you. Thank you. Thank you, bill and kelly. Thank you, Mark Bertolini. More reaction coming up to our interview with senator rand paul in the next hour. In particular, his view that a plan for offshore Corporate Taxing would work better. We have the rally continuing with about 40 minutes left in the trading session. The dow up more than 1. 5 . Energy stocks leading the way with the price of oil up shortly. Were comfortably above 50 a barrel on west texas intermedia crude. The oil surge continues. Well go live to the nymex. The latest action in the oil pits and why crude is on the upswing once again. Plus a company thats benefited, ryder systems ceo gives us his take on oil, the collapse the recent rebound and how it factors into his companys profits when we come back on the closing bell. Its a fact. Kind of like shopping hungry equals overshopping. We needed 30 new hires for our call center. Im spending too much time hiring and not enough time in my kitchen. [ female announcer ] need to hire fast . Go to ziprecruiter. Com and post your job to over 30 of the webs leading job boards with a single click; then simply select the best candidates from one easy to review list. You put up one post and the next day you have all these candidates. Makes my job a lot easier. [ female announcer ] over 100,000 businesses have already used zip recruiter and now you can use zip recruiter for free at a special site for tv viewers; go to ziprecruiter. Com offer2. Welcome back. Up almost 300 points on the dow. The s p adding 25. The nasdaq 39 and among the interesting stories today, bill mcgrawhill up 3. 5 . Moodys up 3 on the s p settlement why the government. Plenty of green on that map today. Staples and office depot among the gainers as they talk mergers. Meanwhile, a big rally in oil, maybe even an important rally if we believe Rick Santelli. We always believe Rick Santelli. Jackie deangelis is at the nymex. Tell us about what happened today. Good afternoon. 53. 05 is where we settled, just under 3. 50 gain today. 7 . Hard to believer that last thursday we hit 43. 58. A couple reasons for the move higher. The first is the refinery spike starting to spook some traders but also the news of the cap ex cuts and rig declines are impacting the market. People are starting to forecast that u. S. Production is going to decline in the back half of the year. Still there are those out there who say not so fast. This could be a head fake. We dont always see prices move lower in a Straight Line and this could be a technical bounce to the upside. Some people making a quick profit. We could see that 60 range before we see a three handle. Back to you. All right, jackie. Thank you. Despite the rally, were seeing low oil prices giving Truck Leasing company ryder a boost surpassing wall street expectations in its Fourth Quarter results. Joining us right now, we welcome ryder system ceo robert sanchez. Great to see you, bill. Is it the economy thats helping giving you that tailwind or is it the lower price of oil . Tell us how that quarter went. Well fuel at ryder we resell diesel fuel to our customers so its primarily a pass through with a fixed dollar markup. Its really been the economy. As the economy in north america has improved weve seen our customers expand and were getting the benefits from that. And then also theres a secular trend. Were in the outsourcing business. As the things that we do around Fleet Management and supply chain have gotten more difficult for companies to do on their own, were seeing more and more of those Companies Hand it over to Companies Like ryder so that we can take that those functions over for them. And what can you tell bus the second day now of this oil strike . How significant is it . Any hit to your business . There hasnt been. I mean, i think the big story for us is the drop in oil prices over the last 6 to 12 months has put a lot more money in our customers pockets. Its allowed them to invest in their business and then obviously our customers commercial customers, the consumer has gotten a benefit. Were well below levels we were at just six months ago. Give us a sense of the sectors you are talking about that are benefiting that you see them outsourcing more to you right now . We went through this last quarter. The one before that we were at 5 we were told on gdp. Then it was 2. 6 . So weve seen a slowdown but obviously some of your customers are benefiting in the meantime. Who are they . Were seeing Freight Movement increases across most industries, whether its food business, Food Distribution business, the Housing Market really a lot of the markets that are driven by consumers. Were seeing those have a lot ever activity. So if you look at Freight Movement, Freight Movement over the last couple quarters has continued to look strong and were forecasting that to continue as we get into 2015. And robert what about innovation in the sector and do you view Companies Like amazon and uber as significant partners or competitors . Absolutely. I think they could be partners they could be competitors. A lot of our business is moving towards more innovation and finding new ways to help customers be more efficient. So we have new products weve introduced in the market. Were now doing were going to be providing maintenance to some of the larger truck fleets in the country that we have not historically done before. Weve got a very strong presence in mexico so as more companies begin to assemble and move some of their manufacturing to mexico were very well poged to help them there. So clearly theres a lot of new innovation coming into our Industry Sectors and, again, into Companies Like ryder. Would it make sense to go to alternative energies to a more green system as some companies are doing . I mean you mentioned diesel as the fuel of choice here. What about, you know, some of the hybrids out there right now . Right. We have been leading the way with natural gas vehicles. We currently have between we have on the ground and we have on order we have about 1,000 natural gas trucks in our fleet. Weve given over 30 million miles with the natural gas trucks and we are now in just about ten different markets and expanding from there in 2015. So we are leading the way by helping our customers get into natural gas trucks. Thats a much greener technology, 25 less carbon emissions, and a much more stable fuel in terms of the price. So as diesel prices go up and down, natural gas is a much more stable fuel. Im laughing to myself right now because i read that statistic in the notes and i thought we were talking about natural gas trucks you were transporting, not you were fueling your trucks with. Now i get it. Im curious on that point, if you can tell us how sensitive of your earnings to say each 10 move in oil prices . They are not impacted much because, as i mentioned, we resell about 280 million gallons of deselliesel to our commercial but we pass through most of the cost and we have a marginal markup on it to handle the cost of moving the fuel. Very little impact on the bottom line when the price of fuel moves. Yeah. I was going to say even when it affects end markets, but again thats not as much of a factor. So robert thank you. Great. Thank you for having me. Robert sanchez, ceo of ryder systems. 30 minutes to go into the bell. Pretty good gain. 280 points. See how we do as we head to the close. A lot of earnings coming out. Disney headlining the storm of earnings along with chipotle, gilead, you. Just mentioned them. Wynn resorts. Well bring you their numbers with our team of pros and see what the market does with it as well. Coming up bob iger speaking with us on a first on cnbc interview. Were talking earnings the Measles Outbreak that started at disneyland and a whole lot more. Keep it right here. Sheila you see this ball control . You see this right . Its 80 confidence and 64 knee brace. Thats more. Shh. I know thats more than 100 . But thats what winners give. Now bicycle kick your old 401 k into an ira. I know, i know. Listen, just get td ameritrades rollover consultants on the horn. Theyll guide you through the whole process. Its simple. Even she could do it. Whatever, janet. For all the confidence you need. Td ameritrade. You got this. You just got a big bump in miles. So this is a great opportunity for an upgrade. Sound good . Great. Because youre not you youre a whole airline. And its not a ticket youre upgrading its your entire operations, from domestic to international. Which means you need help from a whole team of advisors. From workforce strategies to Tech Solutions and a thousand other things. So you call pwc. The right people to get the extraordinary done. Rally continues. Were trying to catch the eye of art cashin to see what kind of imbalances we have as we head to the close. The dow is up 281 points. Energy stocks among the leaders there today. S p is up 1. 25 . Nasdaq is the laggard, still up 41 points. Thats a pretty good gain but some of the High Profile Companies in there, apple among them, is lower today, interestingly, on an otherwise big up day. And a speaking of which, exponential entrepreneurs, well what does that mean . These are people who tap into futuristic technologies hoping to create a Global Impact and, by the way, make a fortune. Its bard of a new book called bold, how to go big, make bank in a better world. Were joined by the coauthors peter and steven. Good to see you both. Thanks for joining us. Were talking about the google guys. Talking about elon musk, richard bran sonson branson, jeff bezos. Theyre entrepreneurs, but theyre exponential entrepreneurs. What does that mean . Were in a world where we have access to the worlds knowledge on google cloud, Cloud Services for infinite computing, ai robotics. These are the tools that only the largest governments and corporations had before. Today we all have access to them. We can do things that are on a massive scale. And so an entrepreneur today can actually go and build something that helps a billion people and becomes a billionaire in the process. Your point about scale, steve, is real interesting. I think about uber is which is only a couple years old and a huge company thats been massively disruptive. Ub ser a fantastic example. Whats possible now is you can play at a scale go back 10, 120 years 20 years ago, it required billions and billions of dollars to play at scale. Ubers valuation is above the hyatt hotel and they own no physical properties. I think of personalities like a jeff bezos, they start in one area and they emanate from there. Google does the same thing, Richard Branson does the same thing. They start in one spot but they dont stay there. Every company will be disruptive. The stat i love is 40 of todays fortune 500 companies will be gone in a decade. And so its really i talk to a lot of fortune 500 ceos and they say unless youre disrutting yourself someone else will. A lot of ceos say i will disrupt on the margin. I will be steve jobs going to the music business or the phone business or larry page going into the car business. All of these areas are possible today, and the realization is as an entrepreneur, you have access to extraordinary capital with crowd funding, expertise with crowd sourcing. You can take on the worlds biggest challenges. Its still a challenge for investors because even looking at the 3d stocks you would think just bet the farm on those guys but they got hit hard. What lessons, if any, do you draw for investors when they try to think about who or what to back . Well what we look at first is more than anything else were interested in the development of userfriendly interface technologies right . This is Marc Andreessen created mosaic and it unlocked the web. If you look at 3d printing right . It may be taking a downturn but the enabling factor is anybody today, right, can use a 3d printer. If you can literally color inside the numbers, you can run a 3d printer. Same thing with robotics. Used to be Computer Scientist runs a robot now we have baxter. For first time in history not only can anybody play at scale you dont have to be a technologist. But to tellkellys point is an exponential entrepreneur going to be a good investment all the time . I think of elon musk with tesla. Its everybodys darling until its not. Amazon, for years theres been skepticism about jeff bezos ability to turn a profit with his company. I think the point is the number of players taking on the worlds biggest problems and the rate at which were going from i have got an idea to i run a billion Dollar Company is faster than ever before. Chad hurley starts youtube on his credit card and sells it to google for 1. 8 billion. Oculus sells to facebook for 2 billion and this kind of velocity of capital krethscreation. I think you have to look at the scale of the problem theyre taking on, the technologies theyre using and thats really where were going to see a thousand x, million x increase. There has been a concern expressed about artificial intelligence. Do you share the concerns . In the near term no. I think in the near term ai is really machine learning. If youre not a data driven company, youre out of the game. In the long term ai of course, were talking about the worlds most powerful technologies but today its something an entrepreneur can harness to build your business. Can i become an exponential entrepreneur . Anybody can become one, all you have to do is tap into expo exponential tools . Come on, bill. You tweet. Youre already the embodiment of this big. Its called bold. Cool stuff. 20 minutes left in the trading session here. Still near the highs of the session with the dow up 281 points. Coming up disney posting earnings just after the close. Well tell what you numbers wall street is looking for next. And deliver disneys numbers to you right when they hit the tape. Plus disneys ceo bob iger will be speaking with kelly in a first on cnbc interview. Plenty to talk about, earnings the global economy, the Measles Outbreak started at disneyland as we know. Whats he doing about that . You wont want to miss all of that coming up. Welcome back. Only about 7 points away from a 300point rally across wall street. Plenty of reasons to cite not a lot of consensus, but oil seems to be playing a key role. Caterpillar the best performer up 4 . Chevron next, 3. 25 . Even the financials and home depot doing pretty well. Only coke and intel in the red. Loo disney is up. The component unveiling earnings at the top of the hour. Julia boorstin will be covering that for us in los angeles. Julia, whats the expectation . Well, kelly, analysts have been revising up their earnings projections projections. Disney is expected to benefit from higher ratings and ad pricing at espn. The question is how much will that be outweighed by higher programming costs. With disney shares up over 30 over the past 12 months wall street is looking for fiscal First Quarter revenue to grow 5 and earnings per share to grow 3 . Ill be back at 4 15 eastern when disney releases its earnings numbers and well have a first on cnbc interview with ceo bog iger. Kelly and bill back over to you. Thanks julia. Looking forward to that. Our Julia Boorstin covering disney. A huge market day. We have the final couple minutes when we come back. Almost up 300 points right now. Your moms got your back. Your friends have your back. Your dogs definitely got your back. But whos got your back when you need legal help . We do. Were legalzoom, and over the last 10 years, weve helped millions of people protect their families and run their businesses. We have the right people onhand to answer your questions backed by a trusted network of attorneys. So visit us today for legal help you can count on. Legalzoom. Legal help is here. About 12 30 left in the trading session. Art cashin walked by and got a wow from us. He was just telling us 800 million to buy in balance into the close. Thats probably why were up where we are. The dow up 290 points. Its actually a question we put to Liz Ann Saunders from Charles Schwab on the floor. Welcome. Thank you. Good to see you down here finally. Its fun. There were some people saying its oil but were a couple dollars off the high of the session. Is it people buying the dips. What do you make of the rooly . I think the rebound in commodities to some degree is giving people some comfort that this is more a supply story than it is a Global Demand story and i think a continued plunge might have been additionally unsettling. I think interestingly it may be a part of that. Can that continue if the dollar continues higher which i think you expect to happen . Actually the first lift we got in oil which came when you saw how big a drop we got in the rig count came in conjunction with the dollar going up. You can divorce the two in the short term. I think thats what were see pentagon. What about Interest Rates . We have noticed some of the best performing parts of the market have been down in the last several sessions. If you continue to see some counter trend rallies whether its in commodities or the dollar, i think that suggests you might get a bit of a lift in rates which means there might be more of a cyclical bias in the stock market and away from some of the defensives. And youre always reminding people they should be diversified globally not just in the u. S. And i think this will be youre pounding the table right now. I think this will be the year it will matter more than it has. How much risk are you taking if you look to europe . I think you want to be careful and probably hedge the currency risk for the most part and thats not across the board but for a lot of individuals. Dont deal with the currency piece of that risk equation. But i think nonu. S. Markets already are starting to look quite healthy relative to the u. S. Market and i do think this is a year where youre going to see the benefits of global diversification. Were seeing a lot of shift in some of the forces that have been behind the u. S. Market and against many overseas markets now move not necessarily against the u. S. Market but i think were at those inflection points in nonu. S. Market that is make them look intriguing. Im curious when you raise that, what powers the u. S. Market higher . Last year we had a big help from energy. Last couple sessions weve had that but unclear Going Forward. Financials kind of just sitting there. Is it tech . Even a day like today we have amazon and apple red onned the session. But up 300 points right now. Tech is still our favorite sector, but i do think it is going to be companies and industries and sectors that can actually display that Earnings Growth. Growth. Well be at a more constrained earnings environment. You need earnings to do a bit more of the heavy lifting and in an earnings constrained environment, growth tends to be more of an outperformer. I think thats where you will get your opportunity. Juf been a bull since 09. We know that. But this year i still think the secular bull market is ongoing, but i think this year could be a year like maybe 97 or 98 where you have more volatility greater likelihood of a pull back a bit more extreme than what weve enjoyed over the last couple years but its not an end to the bull market. Is that because the fed starts to raise rates or just the anticipation . Or is it the opposite because you bring up that period when greenspan in response to ltcm or whatever decided he was going to be cautious. You had major move in oil prices. You had currency crises russia and asia. It ended up leading tol t youre talking about the late 90s. Right. But there are similarities to that environment. A tremendous amount of volatility in the currency markets obviously. Could you have these mini crises, could you have a sharper pullback than what weve gotten used to, but i think its in the context of an ongoing secular bull market but a more mature phase. You go through pauses and i think were in one of those phases. Well leave it right there. Thank you, liz ann. Art cashin when he said there was 800 million of stock to buy into the close here seeing the impact. Dow up 300plus points. Now with a gain of 1. 75 . S p up 1. 4 . Nasdaq up a cool 50 appointments right now. Well be right back with the closing countdown and another day, another batch of after the bell earnings. Disney and chipotle among them. Well get you the numbers with instant analysis. And Ceo Robert Iger will be along in first on cnbc interview to break down the entertainment giants results and a whole lot more. Youre watching cnbc, first in business worldwide. Opportunities arent always obvious. Sometimes they just drop in. 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. Theyre coming. What do i do . You need to catch the 4 10 huh . The Equipment Tracking system will get you to the loading dock. There should be a truck leaving now. I got it. Now jump off the bridge. What . In 3. 2. 1. Are you kidding me . Go. Right on time. Right now, over 20,000 trains are running reliably. We call that predictable. Thrillingly predictable. Five minutes to the close, and the rally continues. Just off the highs here. Let me show you the chart of the dow for this day. Oh, im sorry, weve got phil lebeau. We have the aggregate number now. How many cars and trucks did we sell in january, phil . Bill the sales pace according to auto data 16. 66 million vehicles. That is greater than many were expecting. Yes, january is a low volume month, but 16. 6 million, that is better than many were expecting for a sales rate last month. Back to you. Good stuff there. Thanks, phil very much. Now, where were we . Here is the dow for the day. We were in rally mode right from the open this morning. Sideways for a while and then it took off in the afternoon session here especially that last hour and up 294 points. Much of this fueled by the rally in oil. Very impressive rally for the price of oil. Weve all highlighted the fact that just last thursday we were at an intraday low of 43 and change on wti, and here we are today already back to 52 and change. Were off the lows of the social after the settlement here. Its come down but still a healthy gain of 5. 7 . I was just seeing up on the board there, even with this rally in oil, transportation stocks very strong today, which is an odd move. They usually dont work in tandem. Now we get earnings out tonight. A lot of High Profile Companies starting with disney and you will see bob iger coming up. That stock is up 2 as we head to the close. Chipotle, which, of course one of the darlings on wall street in the fast food section, up 1. 6 . Gilead sciences red hot lathe. Up 0. 75 . And wynn resort up 4 in that category. We have daryl from wells fargo along with bob pisani here. Were off to the races here in february, arent we . You mentioned oil. Were not just having an oil rally today. Were having a commodities rally partly on the fact that the dollar is suddenly a little bit weak. Havent seen this in a little while, but grains are up base metals like copper have been up the last couple days. A nice little rally, and were seeing metal stocks rally in a way we havent seen before. One of the heavyiest volume etf is the base metalse tf people buying futures contracts in aluminum and copper. Remember, bottoming europe bottoming bond yields bottoming oil, all of these things have been happening and thats fueling the rally. Where are the opportunities . I would agree. Who would have thought a couple days ago we would have been talking about a bull Market Crossing over to a bull market in present crude. Were up 20 in the last several days. Its really the antitrade thats been going on. Its dollar weaker. Its oil up. Its gold prices down. But is it countercyclical or is it enough to want to buy some Energy Related stocks right now . Were still a little neutral on energy. We think the supply the excess Million Barrels per day coming into the marketplace is just going to push prices were just getting a little bit of a Short Covering rally i think today, although we do think though by year end were still in that 60 to 70 wti camp. We think it goes higher all the oil news is largely out now. Remember, today is the 50 mark on earnings for the s p 500. Half the s p has reported. This is going to be the easy back end because right now the earnings estimates are going to start going up. Weve had disappointments with banks and with some of the earnings on the Oil Companies. I think youre going to see right now 80 of the companies have been beating estimates. Thats a lot better than it was earlier in the year. Which will push revenue numbers positive and get us off that 3 Earnings Growth were tracking to on q 4. It will probably trend up to 4 5 , 6 put a bid in equities again i think. Even with that lower dollar gold still tumbling. Were up 304 points on the dow. I think the thing about the gold bugs is they want to argue its a good time to own gold because theres a lot of uncertainty but low inflation environments have traditionally not been great. Theres always a reason to hold gold. This is the eternal thing. I keep hearing about why we need to own it and yet right now historically its not been strong. Thank you guys. Thanks, daryl, very much. See you later, bob. Going out strong. Near the highs of the session with a gain of more than 300 points on the industrial average. For the month of february up about 500 points on the dow. Stay tuned. Weve got a full hour of earnings come ug up plus that interview with bob iger and disney on the second hour of the closing bell. See you tomorrow, kel. Thank you, bill. Welcome to the closing bell, everybody. Im kelly evans. As we hit 4 00 on wall street, a flurry of earnings due out in moments. First lets get to how were finishing what turned out to be a huge day. The dow going out with a gain 301 points. Well see if that holds as things settle out but thats good enough to put the dow back at 17,662. The s p up almost 1. 5 . The nasdaq interestingly enough the laggard on the session. We had big names like apple and amazon actually weaker. Lets bring in todays panel and talk about it. Ed joins us fromq ma. David sourby is here. Welcome to you and our very own jon fortt. Glad to have you all with us. Also fast money trader tim see seymour. I think this was a classic risk on day. The risky assets stocks and commodities did very well. The dollar and the safer currencies fell back. So i think its a good sign for the future but its only one day. Is it new front, new trend . Can we count on this to keep going in february . I think we will see an up year. I think the economy is doing under the surface better than a lot of people think. You will see actually maybe a little higher valuations on stocks as the year goes on. What are you buying, david . Earnings earnings and more earnings and we saw with the Motor Vehicle sales numbers. 16. 7 16. 8 million in cars and light trucks. Usually this stage of the business cycle, you dont want to own the autos. I have learned that for 30 years. This time the autos are better allocators of capital, better shareholder friendly names such as General Motors or lear which is even more interesting today because theres an activist shareholder in play. This is a unique business cycle, and it is going to be i think longer and slower as opposed to the usual quick up and down cycles were used to. I was going to ask if this is where take autos, are we going to come back and say we should have known it was behaving so weird, it was all a credit cycle. Not that thats a terrible thing. Look at companies that are good allocators of capital, good cash flow generators youll make money. Dominic chu is keeping an eye on the numbers for us. Were watching chipotle shares. The extended hours down 5 right now. Headlines earnings per share coming in at 3. 84 a share. Thats a slight beat over the 3. 79 that analysts were expecting on average. Sales coming in also slightly ever so slightly lighter. 1. 07 billion. The average analyst estimate was for 1. 08 billion. Samestore sales, sales in stores open for at least a year coming in at a 16. 1 growth rate. That, again, narrowly misses the average analyst estimate of 16. 3 . And restaurant margins coming in as well a little bit lighter, 26. 6 versus a 27. 6 average analyst estimate. So those are some of the headline numbers. You can see as a result here chipotle shares down about 6 . Going into this report kelly, over the last eight quarterly reporting days chipotle shares were up six of them. This is kind of bucking the trend at least over the last two years. Back over to you. Say that earnings number one more time. 3. 84 in earnings per share on sales of 1. 07 billion. A slight beat on earnings but a slight miss on the revenue side. Dominic chu, thank you. I ask because estahe is at this myself were looking for a beat of 8 cents. Chipotle not matching that. This is a company that just missed on revenues after posting double digit Revenue Growth pretty much after its ipo. A big miss from a well loved and broadly owned name. If this after hours action holds, it will be falling to the levels of about a month ago in january. But overall im looking at a lot of high flying names. Youve got twitter, you have linkedin especially which reports just in the coming days just like twitter does. I think its going to be really important to see where these names go, whether their trends are Strong Enough to justify a lot of the valuations theyve gotten lately and some of them are getting today. Twitter and linked in both up strong. Twitter more than 6 . Kind of on this risk on hope. Let me just get to robert luna and tim seymour. What do you make of this from chipotle . Shares down 5. 5 after hours. Tim . I tell you what cmg has had such a great run. There were a lot of upgrades into the earnings announcement. It trades at a significant premium to other guys in the sector. They totally deserve that if you look at the growth but the korchs as we just heard, theyre very high. They hit 16 . I felt they felt they needed to come in at 16 or 16. 5 . If you look at other companies that some might say are broken like mcdonalds or yum, they traded half that multiple. To trade at that multiple you have to keep growing. The comps are very hard even in an environment with lower gas and other kind of consumer tailwinds. Theyre not doing it. Robert luna what food names do you like . We dont own chipotle and i think tim hit on it. When youre trading at 36 times earnings in coming in and slightly missing revenues slightly missing margins, thats not going to do it. Thats why we dont invest in momentum stocks. The casual Restaurant Industry is challenging when you look at mcdonalds, theyre suffering. Were kind of away from that sector altogether. We prefer to invest in Companies Like white wave and celestial. Im looking at the panel. We just had eric chemi tell us that one of the places extra gas dollars is going is restaurants. Is it just its not the chains anymore . What do you make of the numbers. This stock politely said priced for perfection priced for sainthood. Do you see what happens when they miss on the revenue number . I think you can own a stock if you look at the filings we own yum. A better valuation play and a nonu. S. Growth story. Lets get to breaking news were now seeing on macys. Courtney reagan has the details. There are a number of headlines on macys. I want to get to the one i think is moving the stock after hours. That is that macys is actually increasing its guidance for the full year above previous guidance as well as for the Fourth Quarter of 2014 consistent with expectations. Its also buying blue mercury. Thats a skin care and makeup retailer. Macys shares are trading higher and the last thing is that Jeff Jeanette is relinquishing his daytoday responsibilities as macys chief merchandising officer. Why we care about that is because jeff is widely considered terry lundgrens heir apparent if and when mr. Lundgren decides to move on from macys. So thats something that is very important for us to notice and i think we might have more information coming for you in a moment but three big things for macys there. Any indication of price for blue berkmercury . 200 million. Wow. What do you think court, you know the blue mercury as a chain. People probably used to seeing it maybe in some retail locations. What do you think of the fit this creates for macys . Its interesting and i think what macys has done really well is aggregated very very strong brands. Blue mercury is in and of itself an aggregator of brands in some way because they sell multiple different cosmetics lines and so i think thats something that does somewhat fit with macys. Remember jcpenney has sephora locations in many of its stores which has done very very well for it. So its an interesting fit. I think macys has made a lot of smart decisions with the brands they acquire or partner with. Courtney reagan at headquarters. Thank you. A little bit under pressure after hours. Do you like the name . I cant talk about individual names but i think if you look at the numbers we got so far, overall it suggests the American Consumer is actually doing pretty well. Actually we just did a piece that suggests that Earnings Growth, wage growth for the typical worker is maybe a little better than the numbers indicated. I think the overall picture for the American Consumer is actually pretty good right here and broadly speaking it shuz benefit that sector. Do you agree . Household Free Cash Flow after you pay your Capital Expenditures or your debt its growing. Youre right, employment is growing. Low gas is i think a positive for the market and the consumer and you can own names such as might not be macys but it could be qvc because of all the Online Shopping with liberty interactive. Lowes, the Home Improvement store, theres a robust list of Consumer Discretionary stocks for the shopping cart. What i just dont get is theyre not all seeming to benefit or at least expecting to benefit from this. I mean apple aside, they had an amazing quarter, and their guidance while conservative was still really really strong. But you look at your best buys look at other names that have come out and guided conservatively through the year even with their north american exposure and it sort of makes you wonder why. Tim, well give you the last word. I think if you look at macys, to me they are best in class and theyre priced at a reasonable multiple. I dont think thats necessarily hinged to a u. S. Consumer that does a whole lot better because of gas prices. I think the Retail Sector theyve been very vulnerable. Theyre high multiples. I think macys is defensive. Id stay with the name. Thank you, tim. Tim seymour, stick around to catch him coming up on fast money at 5 00 p. M. Theyll have all the after hours action. Conference calls, were listening to gilead chipotle and disney. Still to come disneys earnings are due out in a couple minutes. And ceo bob iger is here in a first on cnbc interview. Plus iger going on record about the measles scare. Youre watching cnbc first in business worldwide. Welcome back. Plenty of action after hours. Gilead science is out with its quarterly results. Were looking at a beat on revenue and earnings. Looking at revenue of 7. 3 billion for the Fourth Quarter versus analysts estimates of 6. 72 billion. Earnings per share of 2. 43 versus 2. 22 estimate. Now, the big number everybody looks for is that hepatitis c drug sales number. That came in at 3. 8 billion worldwide versus estimates looking for about 3. 6 billion, but some really big news coming in a separate release from gilead. Theyre announcing their first dividend. Theyre going to be paying a 43 cent Quarterly Dividend and they announced a 15 billion Share Repurchase program. So all of that money coming in for hepatitis c, people were wondering what they will do it with it. Announcing their first dividend and a 15 billion Share Buyback on top of a beat in the Fourth Quarter. The call starts at 4 30. Well be listening for a lot more details there. I was going to say, explain to me why the stock is down but now it looks like its up. These are all the kind of shareholder friendly moves youd like to see. Especially in a world where its hard to make money buying bonds and buying fixed income product. I think stocks could offer a good al tern tiferf if they offer dividends. This company is basically quadrupling its earnings. Were an owner. I think one of the key ingredients is its not simply dividend yield but who is initiating and growing the dividend. Thats been long term a great formula to finding Wealth Creators for the market. Interesting as well they had a big deal with aetna who we spoke with last hour. It does appear to be some kind of a concession but their battle to win back share looks like its paying off. It is. Its been a great space for Growth Investors to be especially in the last 12 months. Do you know it i dont mean to keep asking you about individual stocks. Do you like the Health Care Space generally . It had a great run last year. It was one of the best performers last year and i wouldnt be surprised to have it trail a little bit this year because it is selling at a premium price. Weve talked about relative valuation and i wouldnt be surprised to see some of the highest valuation sectors of the market pull back and its healthy. Thats healthy to shaking out mediocrity from superiority. I think the same thing is true on a global basis. The United States is selling at a premium price. It may be time to rotate into cheaper stocks in europe and elsewhere. And you made that point, that people were making that very rotation. Thats a normal natural, healthy part about market action. I think amazon is a stock that a Growth Investors can own for the long term and the valuation in the last six months makes it more compelling for the value investor. And our disney earnings are out. Lets get to julia with the numbers along with disneys ceo bob eyeinger in a first on cnbc interview. Julia . Thank you so much. Disney beating on the top and bottom line. The company reporting earnings per share of 1. 27. Wall street had been looking for just 1. 07. So thats a beat by 20 cents and thats compared to a year ago, 1. 04 in earnings per share. A big beat on the top line. On the bottom line revenue also beating. The company reporting 13. 39 billion in revenue. Wall street had been looking for 12. 89 billion in revenue. A big beat on the top line as well. It looks like that was driven by strength pretty much across the board with particular growth in the Consumer Products division where revenue grew 22 and operating income for Consumer Products grew 46 , also strength in parks and resorts where operating income grew 20 and studio entertainment revenue operating income up 33 . Joining us now to talk about disneys year ahead is bob iger ceo. Thank you so much for joining us, bob. Youre welcome. Big beat on the top and bottom line. What was behind this upside surprise . Just a great, great quarter for the company across the board. Clearly i think it is a great testament to strategy to focus on frab chisnchises and our great brands. Parks and resorts benefit from that but also some Operational Excellence and clear demand around the holiday period. Just about anyway you look at it the company had a great quarter and i think again it says a lot about the properties, the assets that this company now has. Stud yoi entertainment, 33 increase in operating income. Is that all about frozen Home Entertainment revenue. Theres also Home Entertainment revenue from maleficent and guardians of the galaxy and the Consumer Product sales of frozen. What about star wars . Star wars is coming the end of the year december 18th. I have had the benefit of seeing a fair amount of the footage although not edited 20g9 eded togethered edand i visited the set. I cant wait to show it to the world. One of the few areas you saw a decline was in Cable Networks operating income. That operating income declined 2 and you say its because of higher sports rights costs. How much are these growing costs going to weigh on espn growth moving forward . This was a new contract with the nfl, so the rights fee that espn paid the nfl in the First Quarter was substantially higher than it was a year ago. Well have some extra Program Costs for espn in the quarter that were currently in from the College Football championship, and then the next big deal to kick in for espn will be in a few years with the impact of the new nba deal. If you look at the back half of the year fiscal 2015 the Program Costs for espn will not be substantially greater than they were a year ago and then after the nba deal kicks in then the rights fees for espn start to flatten out a bit. Theres still some increases annually but nothing close to the increase that is the big packages have obviously created. Now, espn is clearly a huge driver for disney. This is the first time youre including espn in dishs new over the top streaming service. Why did you decide to do this . Arent you concerned this is going to encourage cord cutting . No. Actually what this is designed to do is to really attract people who we call cord nevers or cord laters. Theyre about 12 million broadband only households in the United States, for instance. People that have wireless or Broadband Connectivity but they dont have cable. And so we think that this is a way for basically lower price to attract people that either may not have signed up at all or may have waited to sign up later. Its a bit of an experiment. Were going to wait and see. But we believe in the strategy and we believe in a media environment thats changing right before our eyes that some experimentation is necessary, and i dont want to just chalk it up to an experiment because we actually believe this is going to last, but we are going to take a careful approach and obviously not put in jeopardy the expanded basic bundle which is so valuable to the company and to the industry. Speaking of changing environment, are you concerned that digital is going to eat into the Advertising Market this year . Weve been seeing money flowing from traditional advertising platforms to digital for quite a while. As i have said before were both a buyer and a seller of advertising time. When we buy advertising for our parks and resorts for our studio, we typically have media plans that have significant digital components to it so i think this is a way of the world. Lately weve seen a slight flattening out of some of the digital spending but i think that theres no question that consumers are spending more and more time consuming media on digital and thus advertisers are interested in it. Were taking advantage of that too. You say here that your growth in parks and resorts operating income was driven by higher guest spending. Are you also seeing an uptick in attendance. Yes. In the quarter we just reported we had increased attendance and increased guest spending and we had obviously that resulted in a nice increase in our margins as well. And whats your sense of the health of the consumer right now based on your outlook . Generally better. Generally better. I think in our case weve got a strong product cycle that clearly helps, but what were seeing from the consumer in terms of the signs of spending and making earlier decisions in terms of booking vacations is definitely improvement. Speaking of the parks, what impact has the Measles Outbreak which was traced back to disneyland, had on disneyland and the parks in general . We really have not been able to discern any impact at all from that. In fact, if you were to look at disney disneyland, the quarter were currently in were up from where we were last year in both attendance and in bookings or in reservations so we just havent seen an impact. Public Health Officials say that kids who are too young to be vaccinated should not go to disneyland or other crowded Public Places. If you take me i have a 3 1 2yearold who would love to go to disneyland but i also have a baby who is too young to be vaccinated. Were going to be holding off on taking our family for now. Do you think situations like this could have an impact in those Public Health warnings will have an impact . Well i think, you know, this is a time for parents like yourself with kids under the vaccination or inoculation age to be cautious about taking their kids to Public Places not just theme parks. There are a number of other places. You know Mass Transportation and movie theaters. Could you probably name a number of them. I think its time to be careful. I have a grandchild under 1 actually and i think, you know, its the smart thing to do. But if you look at the visitation that we see to disneyland and disney world, the percentage of people that come with kids that young is not particularly large but so far, again, we have not seen a real impact. Were out of time now but one quick final question, this Measles Outbreak has prompted a new debate about vaccination. Where does disney stand . Well, were not in the medical profession obviously. Were not doctors. The research that i have seen and what i have read from places like the cdc suggests that getting inoculated is a smart thing. Its a proven strategy in terms of combatting a disease that, you know, can be dangerous to young children. So i would personally i would advise it. We appreciate you weighing in, bob iger. Thanks so much for talking to us. Kelly, back over to you. Julia boorstin thank you so much. Our thanks to bob iger there as well. On disneys earnings and of course, a whole lot more. Lets send it out to dominick chu for breaking news. We have a multibillion dollar acquisition coming after hours. J. M. Smuckers company, the Company Behind jams and jellies, also Peanut Butter and coffee, has announced a deal to buy big heart pet brands for 5. 8 billion which includes 2. 6 billion worth of net debt. Big heart pet brands is owned by private equity parties, including kkr, best star and center view. This is the company that was form nally known as del monte. Its the del monte pet foods unit. It owns meow mix, kibbles and bits milk bones. Its a big acquisition for smuckers. Last year mars bought the pet food unit of proctor gamble. So, again, a lot of this consolidation and moving around of pet brands. Its a big business. Back over to you guys. Big advertisers, too. I keep thinking of those jingles growing up. Dominic chu with big news for smuckers shares. Theyre responding positively. The u. S. Government announcing nearly 1. 4 billion settlement with standard and poors over its ratings. What, if anything, has changed in the Credit Rating agency since then . Well get you some answers. And then the hope is that we will actually see that it is a net positive over five years and that we will renew it and hopefully this is a step towards making it permanent. That was senator rand paul telling me yesterday why he thinks an offshore Corporate Tax holiday this time will work so well even democrats will want to make it permanent. Is he right on that . Well talk about it coming up on the closing bell. Stay tuned. Take a deeeeep breath in. And. Exhale. Aflac and a gentle wavelike motion. Ahhhahhhhhh. Liberate your spine. Ahhhahhhhhh. Aflac and reach, toes blossoming. Not that great at yoga. Yeah, but when i slipped a disk he paid my claim in just four days. Ahh four days . Yep. See why speed matters, at aflac. Com. Why do we do it . Why do we spend every waking moment, thinking about people . Why are we so committed to keeping you connected . Why combine performance with a conscience . Why innovate for a future without accidents . Why do any of it . Why do all of it . Because if it matters to you its everything to us. The xc60 crossover. From volvo. Lease the wellequipped volvo xc60 today. Visit your local volvo showroom for details. Can it make a dentist appointment when my teeth are ready . Can it tell the doctor how long you have to wear this thing . Can it tell the Flight Attendant to please not wake me this time . The answer is yes, it can. So, the question your customers are really asking is can your business deliver . The earnings coming in fast and furious. Jane wells has more out in l. A. Whats happening, jane . Hi kelly. Looking at wynn resorts down after hours after a big miss by the company on the top and bottom lines. Wynn reporting about revenues of 1. 14 billion. The street was looking for a little over 1. 2 billion. Earnings per share came in adjusted at 1. 20. The street was looking for 1. 43. The big difference is a 32 net revenue decrease in macao and a nearly 6 decrease in net revenues in las vegas, and macao, not much good news there. Down everywhere even in the mass market segment. In vegas, net casino revenues were down 15. 5 . Rev par was up thats one difference from Las Vegas Sands and ebitda another big miss almost 353 million. The street was looking for 380 million. The Conference Call starts in about 30 seconds and well be back in fast money with more on that. Jane in 15 seconds that we might have here, what is going on in vegas for this company . We know about macao, but what about vegas . Vegas, you heard it in Las Vegas Sands numbers and the Nevada Gaming Commission came out with new numbers. Vegas seemed to be rebounding but from a gaming revenue standpoint it isnt. And even for Las Vegas Sands, their other spending wasnt doing well. Here in wynn you are seeing revenue per room showing some improvement there. So what will be interesting out of that is to see what mgm has to say because they are the biggest player on the strip and theyre coming out later this month. Thats for sure. Jane wells, thank you very much. For now caping an eye on results for us. Stoord Standard Poors paying out. Federal officials here in washington announce that settle settlement settlement. 1. 37 billion. Federal officials saying in the run up to the financial crisis Standard Poors was simple riven with conflicts of interest. Here is attorney general eric holder. The s p claimed its ratings were independent, objective, and not influenced by the companys relationship with the issuers who hired s p to rate the securities in question. Well in reality the ratings were affected by significant conflicts of interest and s p was driven by its desire for increased profits and market share. Now kelly, that money is going to be divided up between the department of justice, 19 states, and the district of columbia. Back to you. Eamon javers thank you. Eamon in washington. Whats changed with Credit Agency firms since the crisis. Andrew stultman says not nearly enough. Andrew, good to see you again. So nothing has changed . No, no nothing has changed. Look, this is nothing more than a slap on the wrist for the rating agencies. It is literally a cost of doing business. And you know what business wouldnt give up one year of profit to be able to keep 20 or 30 years worth of profits. This activity was very profitable for s p and nothing is going to change. It truly is just a slap on the wrist, kelly. David, we should mention mcgrawhill shares were up 3. 5 . Moodys as well up 3 and they may be coming next in terms of the settlements because a lot of this is is it just retaliation for downgrading the u. S. Government. I want to know when is the government going to get its fine for the late 1990s and perhaps even today when we put individuals into homes that they cant afford . And the federal government had a huge part in that effort in the late 90s and theyre starting to repeat it today by reducing premium insurance for the federal housing administration. That was bad policy. Ed . Kelly, look, i understand that argument and theres a lot of blame to go around okay . But ultimately it was these rating agencies that literally had to put their stamp of approval on the securities otherwise municipalities couldnt buy them certain investors wouldnt touch them with a tenfoot pole. Theres a lot of blame to go around, including the government but ultimately one of the biggest tort feasors were the ratings agency. Was an admission of guilt even a possibility here . First of all as a consumer i think its easy to get cynical, especially when you read about the behind the scenes horse trading. The government wants at least 1 billion here presumably because its a nice headline. The company doesnt want to. S p doesnt want to admit any kind of fault because they dont want the follow on lawsuits but something wrong happened here, and is a monetary payout really enough in a situation like this . Its kind of like a civil judgment when you feel like something criminal happened, right . Yeah. Absolutely. And thats why another reason why i think its defective. Because if you force Standard Poors to admit to liability, the people who are privately suing it would have a leg up and have a much better chance of recovering. By allowing them to say we did nothing wrong and we promise not to do it again, these private litigants wont be helpened and i think thats a big, big problem. Ed . Its you have to for any outsider to know how the deal could have gone differently but it seems to me its good for the Financial Markets to get this behind us. Is it though if nothing has changed . I think the credit agencies play an important role. If they didnt exist somebody would have to invent them. Theyre not perfect but they serve a useful role. They do. S p, Credit Ratings on corporate america, less than 5 of Credit Ratings are aaa or aa by Standard Poors. In russia every Corporate Credit is aaa rated. What would you do about this market quickly . Id let the market sift itself out. Its not often a popular phrase but i think s p probably deserves some type of fine but in the end you mean get rid of them all together . I think s p serves a great purpose and so does moodys. For people to help do their own homework on is this a valuable credit . We all knew people were going into mortgages that they couldnt afford in that time period of time and the astute investor avoided them. Its fundamentally flawed. The companies receiving these ratings are the ones paying for it and provides too big an incentive for rating agencies to basically give shoddy ratings for money. Thats the problem. As mentioned, the Justice Department looks to be working looking at moodys. Andrew stoltmann, thank you. A buy bill coauthored by senator rand paul would give corporations a greatly reduced tax rate for five years. He says it would work so well it could be made permanent. And mashable getting huge Venture Capital investment. Coming up Pete Cashmore is here with whats next for his company. Omantic than a spontaneous moment. So why pause to take a pill . And why stop what youre doing to find a bathroom . With cialis for daily use, you dont have to plan around either. Its the only daily tablet approved to treat erectile dysfunction so you can be Ready Anytime the moment is right. Plus cialis treats the frustrating urinary symptoms of bph, like needing to go frequently, day or night. Tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. Do not take cialis if you take nitrates for chest pain as it may cause an unsafe drop in blood pressure. Do not drink alcohol in excess. 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Take a listen. The only issue again being, and i do want to move on from this but so our viewers are aware, the concern is you do it one time and companies then keep the cash overseas because they realize it is one time. Its not permanent but lets move on for a second thats why this proposal is actually better than 2005 when they did it for one year. This proposal is for five years and the hope is that we will actually see that it is a net positive over fi years and that we will renew it and hopefully this is a step towards making it permanent. So will this plan worge . Joining me with more is mark la pressy. Welcome. Hi, kelly. This is very different from the 2005 example that was not very successful because companies have 2 trillion worth of cash overseas. Is it different enough to make it work this time . I think categorically the answer is no. This is the same movie we saw in 04 and it ended badly. In 04 there were about 600 billion in assets overseas. It was a oneyear deal and we collected about half. Right. So if theres 2 trillion half isnt so bad. Thats true but where did the money go . And what drives me crazy about this debate its the same debate we had when we talked about Corporate Tax inversions and at the end of the day its the same issue at heart, and that is the following. Boards of corporations have a fiduciary dude to maximize shareholder value. That means frequently tax mitigation strategies. Corporate inversions. If you look where that money went in 04, it went back to the shareholderers. The plan that senator paul and senator boxer have put fort forth, its different. Its five years, not one year. Let me put it to you this way. If we were to change policy right now today to make a 6. 5 Corporate Tax rate on cash brought back into this country Going Forward, would that be a Net Positive Development . I think it would because unless you have the concomitant obligation on the part of corporations to put the money back into the u. S. Economy to help the middle class which is struggling in 04 and i dont think this bill will pass over 60,000 jobs were lost. Money came back to the shareholders. By the way, thats not a bad thing. Thats what corporations are supposed to do. Theyre not supposed to be economically patriotic like the president said. Its like the snake why did you bite me . Exactly. But the bill is supposed to stipulate that the money is spent on r d, Public Private partnerships, on acquisitions. Do you think theyre going to figure out loopholes to that and figure out how to return it to shareholders anyway . Are you arguing that Interest Rates are so low now that 6 really when you do the math it still makes more sense to borrow anyway. Which is what apple did last week. And apples move in raising 6. 5 billion in my opinion was a direct reaction to this debate as it relates to repatriation. If you want to read the tea leaves on what the bill would look like, all you need to do is look at who is lobbying for this bill. And we have to go but, ed i want to give you a quick chance to weigh in. Money is fungible you never know where its going to go but i wonder if this is the beginning of negotiations. You look at the president s position and look at the new bill theyre not that far apart. Would you support it if they come to some if they could come to a number in the middle that would be permanent but it doesnt stand in the place of Corporate Tax reform thats what im saying i think this is a way of getting Corporate Tax reform. 40 in the United States Corporate Tax rates, 20 in the european union, 12 in ireland. Lets learn. Thats something everyone can get behind. Its that simple. Thank you so much. It may or may not be the future of news but the selfproclaimed leading source was news and information for the connected generation mashable is attracting more visitors every day and now more investment. Well talk to Peter Cashmore about how hes disrupting the media business. Stay tuned. Boy once upon a time, there was a nice house that lived with a family. One day, it started to rain. The house tried to keep out all the water, but water got inside and ruined everybodys everythings. The house thought she let the family down. They just didnt think it could happen. They told the house they would take better care of her. Always. Announcer protect what matters. Get flood insurance. Welcome back. As we well know the media landscape is constantly evolving and today some of the sectors big players are being challenged by the new media as the main sources of news and entertainment. With us is Pete Cashmore the ceo of mashable. His firm getting 17 million from time warner investment. Hes on our next list of leaders that will lead their industries in the next 25 years. Thanks for having me. Congratulations. Thanks so much. This is where the hard work really begins. This is our second round so its really about how to invest in the future of media and really continuing to dominate in the new media space. Its interesting because you have been around for a decade and that was a lot we have. I think a lot of people think about new Media Companies and dont realize a lot of this new wave has kind of learned their chops over the last decade or so. Figured out how do you tell stories for the web, for millennials millennials. As were seeing a lot of dollars move in these companies are taking big rounds and move up. Elizabeth taylor once said it took me ten years to become an overnight success. It feels like that. Exactly. Theres all these dollars. We say last year we spent becoming the newspaper of the web. This year we want to be the Television Channel and the magazine. I had a feeling you were going to say that. Jon fortt, are you worried . Well im intrigued because, you know, being in media you want to see media do well. I have a couple former magazine colleagues now working for mashable. How do you invest that money so it becomes a Sustainable Business model for the long term. A lot of people who saw similar things happen 10 15 years ago worry about, well a lot of the ad money thats there now might not be there forever. When theres a downturn will you still be profitable . Absolutely. Being a decade old company weve been through the highs and lows of the market. I think speaking to magazine colleagues coming across, were very fortunate we were able to build the Technology Platform the cm s where journalists could come across our editorial times, two of them are from the times. You are seeing that talent movement. When you talk about whats next the next wave is obviously video. Were investing a great deal in technologies. We have a Technology Platform called velocity which we have used internally. It predicts whats going to happen in the news based on sharing in social media so we get ahead on it. It adds efficiency. And what do you do with the 17 million now . Its about a big investment in scaling up the company. We obviously have the Business Model that works. Its video and its that Velocity Technology were starting to license directly to the brands as well. How about your ability to compete with more exclusive content traditional media, wall street journal, New York Times we really target millennials, i wouldnt necessarily put that in our competitive set. I think what were about is how do we tell stories with this new medium. Not only moving into video but tell stories on different platforms, the apps people are using and tell stories visually or directly to social media. Youre sitting here by the closing bell of the new york stock exchange, some people have been frustrated they cant invest in Companies Like yours sooner. Would a move towards being public be your next or ultimate step . You know i think its a jurn yi. I think you will start seeing over the next couple years some of the new Media Companies starting to ipo. I think, you know, were taking steps on that journey. Were in our series b round. Theres a few more steps before an ipo but that market will start opening in a slow growth world, people have a great opportunity to go on the financial market. I recommend the e cards based on the dancing shark from katy perrys halftime performance which you can find on mashable. A huge rally in oil and stocks that was burning up cnbc. Com. The hot list with Allen Wastler when we come right back. Welcome back. A 300point rally today and oils surging. Thats dominating the hot list. Definitely kelly. Another tripledigit move we get all the people coming in trying to figure out whats going on. All about oil today. How do i know about that . West texas crude on our site the price, equalled and surpassed the apple lookouts. No they didnt. Yes naythey did. Thats huge. That is incredibly huge. Apple is our number one lookup every day. Today, west texas crude lookups surpassed it. So we do a lot of stock ticker lookups. So people diving into the oil interviews, too, particularly the experts saying its a dead cat bounce and a lot of interest in radio shack as well kelly. What did you think of Mashable Alan . I thought it was interesting. The old media new media debate always intrigues me because im sort of both. Yeah. And i think each can learn from each other. But it was a fascinating interview. Agreed. Curious for your thoughts. Alan wasser at headquarters. Weve already seen plenty of volatility to last a month. Were going to look ahead to more earnings and more big moves in these markets when we come right back. Welcome back to another big move today on wall street. The dow was up 300 points. February, were asking our panel here, are we going to see more of this volatility these tripledigit swings ed . I think this might be the beginning of a little bit more positive tone than we had in january. Earnings although there have been some big disappointments, theyre actually on balance. Coming in pretty well. I think the economy has gained a certain amount of traction. Theres some soft spots, and the strong dollar will restrain growth, but i think the consumer is going to be the key to this here. I think the consumer is stronger than a lot of people think. Exactly what you were saying. Watch the wages. What about you guys . Volatility can be embraced. Im an active stock investor. I think the greater the volatility, the greater the opportunity the active investor can add value, and weve talked so much about earnings lets not forget so many small and mid cap stocks roughly one quarter of small mid cap stocks are reported so far. 5 Earnings Growth. 9 to 10 Earnings Growth. Its been a respectable quarter because theres less Energy Dominance there, and thats been positive i think for the equities. 5 top line growth that points you to nominal 5 gdp. Thats not bad. Its not. I look at some of the big tech games. They seem awfully reliant on what happens overseas particularly china and japan. Look at microsoft. Look at ibm. Apple was able to somehow overcome all of that. Somehow immune to all of that. I think were going to continue to see. Have twitter and linked in coming up thursday. They were linked in a lot today. You see skittishness ahead of those earnings. I want to put an eye on what win is doing after the hours. We know its been tough for various reasons in china. Why is it that vegas is so soft do you think . And mgm, it will be interesting to see if they confirm this or not. Any ideas . Nobody knows for sure. It could be instead of going to vegas ourselves, going to theme parks with our children. So its possible that this great growth that theyve had may be going through a bit of a soft patch. Or timeshare. Marriott vacations has been a very good investment play the spinout that took place two or three years ago. Nothing to do with james seemed to be saying theyre going to vegas. Theyre just not spending it on gambling. Is it because theres been a proliferation of gambling at other sites, where it used to only be vegas. Other fun stuff to do. You dont have to risk it. Were going to leave it on that positive thought. Thank you so much. Stay tuned here on closing bell for all of that. My thanks to the panel this hour as we dug through all of those. Fast money coming up in just a few moments with melissa lee and the gang. Whats on tap . Hey there, kelly. Lots of big afterhours earnings movers. Our traders will be trading those big moves in the afterhours session. A of the analyst told his grandma to get into contra resources. So what should grandma do next . Great question. Straight over to you guys. Thanks a lot, kelly. Fast money starts right now, overlooking new york citys times square. Our traders are tim, pete brian, and steve. Lots of breaking earnings news at this hour. A burrito bomb for chipotle. Shares falling after the companys revenue came in below estimates, but weve got someone who thinks the stock is going to 760 a share. And gilead getting hit hard. Discounts for its hepatitis c drug overshadowing the announcement of gilyards first ever dividend. Well bring you the latest. Plus news from wynn and disney. A market rally and a commodity comeback. Oil closing on its highest level of the year today