Here the shares are down 8 right now. Thats not even the biggest point decliner in the dow. Which goes back to how low its share prices got. Exactly. At this hour the Senate Finance committee is beginning to mark up its tax reform bill well tell you whats at stake there and what could be the most contentious issues between the house and senate. Meanwhile, amazon is reportedly considering a freemium option for prime video. Wel n will netflix make a similar move lets get to our top story today, the big decline in ge shares Morgan Brennan has all the ugly details for us morgan reporter hey, bill, yeah, so ge cutting its dividend in half. Its only the third time since 1899 its cut that payout, this is the first time its done it notscenario. Thats only part of the story here big part of why these shares are falling 8 is the updated guidance new eps numbers for 2018 expected to be 1 to 1. 07 a share, reduced by half since the previous target and lower than consensus estimate 6 billion to 7 billion in Free Cash Flow for next year also disa i pointing. Ceo john flanernery says 2018 wl be a, massive heavy lift with detailed execution he expects earnings and cash flow numbers to grow after next year three big takeaways in the midst of a very heavy news day for ge, first hes focusing on the core businesses of aviation, health care and power, despite the challenges in that power business 20 billion worth of other businesses will be exited over the next two years including transportation, industrial solutions, current and lighting. Even ges majority stake in oil field services, giant baker hughes could be up for grabs in the next couple of year ps. Second, cost cutting, going to continue including a cutting even though theres no retreat on the idea of digital. Thats been a big push at ge for the last couple years. Lastly, changes to the companys culture and to management and governance thats including performance and its going to be more tied to excuse me, compensation more tied to performance. Also more equitybased also the board is rishrinking dn from 12 to 18. Three seats will be up for grans next year. And on the earnings front, they are are chanchanging methodologw earnings will be reported on a quarterly basis as well. Lot of big headlines lot of changes at this Company Shares are still down with all of this news today guys, back over to you and 40 for the year, morgan, thank you. They have a lot of work to do. Is this the end of the bad news for ge lets ask jim from Cfra Research and Christopher Glen from Oppenheimer Co welcome to you both. Jim, what do you think about the share price reaction today im sure this isnt what the company was looking for. Yeah, i think its an understandable reaction to the fact ge is admitting that its culture, that its execution, that its targets, that its financial forecasting is off and the extent of the reset of Financial Guidance was such that the street couldnt only react in a negative way. Christopher, you downgraded the stock. Why . The extent of the cut at power on the last quarterly call as well as the projected restructuring savings just didnt add up to a very good prospect for todays investor day. And really indicates its going to be a long turnaround, a drawnout process. There are some very long plays here for the company to get it right, and some are going to be a tough haul like the power markets, the secular changes there. Some could be quite good like potentially divesting or exitinp a lot of cash flow here. What about earnings . Is this a Profitable Company and will it be yeah, i think its going to be a probable company. All we need to see is where is the growth ge is resetting in 2018 as we all heard. And then 2019 and on, their organic Revenue Growth targets are 2 to 4 this is not a company that is a Growth Company if you look at the stock price, its not a Value Company either. Where is it . Its a hold. Well, and jim, ive heard more than one person question today why those three divisions to hang on to. Are there synergies that make sense to keep them together in a conglomerate, do you think i certainly think there are synergies across the board at ge they have Technology Leadership in all these segments and the most important thing that theyre hanging onto is the leadership position. The number one position in these segments thats what they want to be, day want to be the leaders in the segments they compete in and these are the segments theyre holding onto, whether or not seeing that kind of traction, thats where theyre trying to divest chris, what kind of challenges do they face in their remaining businesses because this is in part a decision about what to keep and then still after that, a decision about how to make those more profitable Going Forward. Yeah, so aviation and health care are in good stead, theyre being run well, executing, growing profits, growing revenue. Those are fine what youre seeing at power is a very large share shift to renewables where ges margins are a lot lower. Youre seeing a 40 contraction in the traditional gas power gen markets. And that means a lot of overcapacity in the industry and a lot of Pricing Power theyre keeping it for a lack of Pricing Power. Theyre keeping it because theres no other logical owner like there may be logical exit strategies for some of the other businesses chris, what happened . How did the company find itself in this position its not a single thing i mean, the oil and gas cycle never came to fruition for their particular orientation. Theyre very long cycle. Theyre still a year or two out from seeing the improvement that others have seen they probably lost 20 cents there. Thats the cycle the power gen markets, thats a secular change thats a fundamental change in the markets. Day probably lost 30 cents in and theyve got about 10 cents higher cost of interest to fund the dividend that theyve accumulated and thats part of why they cut that. So it was a range of things. Jim, who might be looking at these businesses now either the ones that are being let go or the ones that remain in terms of being attractive takeover targets i mean, its uncertain who wants to buy assets that are in industries that are struggling right now. Ge has historically been able to find buyers at good prices if you look at their Industrial Transformation when day got out of ge capital, they got out of the assets quickly day have a good track record of doing that the assets they have remaining are going to be good core assets for them for the long term its a longterm story at ge its going to take a while for this to play out thats why the stock is reacting today. All right, gentlemen, thank you. Jim, chris thank you for joining us today tauhank you. Dont miss an exclusive interview with john famililanne tomorrow at 9 30 a. M. , hell join the gang on squawk on the street. The dow is up 30 points at the moment with the s p Holding Steady at 2,583. Up three points. Joining our closing bell exchange, chris from avions from us holly from btig joins us from chicago. And steven sarg gillfoi. Youve been holding ge shares. What do you do with that this becomes not an investment but commerce exercisk management i got myself long. Back when Jeffrey Immelt announced he was leaving the firm, i figured that was a solid. Warren buffett out of the way, a good chunk of the sell side was improved i thought it was a good point of entry. It was not i slammed on the brakes. John flannery does certainly sound like hes a serious guy and the right guy first job, but now you have to rely on your technicals but fundamentals are out the win ddow. Youre looking at things like the pitchfork model, looking at retracements youre starting your models with the highs of late 2016 and tracing them through the recent lows of todays lows and it looks like support comes in right around 18. So were approaching it right now. All right. At that level, i probably increase my holding by about 150 and i look for an exit hopefully somewhere down the road, three to six months around 24 chris, are there any readthroughs for you from ge to the broader markets . I dont see any to my way of looking at it, ge is still null and void in every way. Now, if it was priced at 14, youd g singing a different tune at the moment, the last segment they really hit it no topline growth thats the big thing ge has to do, not manufacturing of earnings. Does it argue, chris, for the end of i mean, this comes and goes in cycles, i know, but is this just a bad environment to be a con grglomerate right now, you think . Absolutely. Its going way back to the 770s we saw them all come apart ge is an example of a dinosaur that was like that. What about honeywell . It chris . I think united yes, United Technology and honeywell have done transformational the right way and concentrated on those areas where theyve been able to maintain growth and at the expense of ge, so its a different story i think for those two companies. Holly, the market you follow, the currencies, the Interest Rate forum out there, what are you seeing right now as we focus so much on the fed and changes there and the expected rate increase later this month . Well, the story in fixed income markets in the rate space sa about the yield curve. Dramatic flattening of the yield curve not only in the past couple days and weeks but really all year im of the belief thats going to continue. You may say, whys that important to me, im trading stocks, might be trading commodities. The reason its important is because in modern mystery history, every recession in the u. S. Has been preceded by an inverted yield curve. 118 basis points thats not anywhere near inverting at this point. Given the dramatic flattening, a lot of people are concerned that maybe the fed is raising too aggressively or maybe its indicative of a weakening economy. Youre talking about ge stocks being down granted theyre their own story right now. A lot of people are concerned about a weakening economy, but im of the mindset that were getting this flattening for other reasons and the number one is pure demand you saw one of the largest u. S. Pension funds today come out and say they may take profits in stocks and put that more into fixed income from 19 to 44 that outright demand is just going to help drive those longerterm rates versus the short term even flatter. So i think that curve flattening is going to continue three months, ten years, probably down to 85. Possibly as low as 40. But keep in mind, bill, even at 40, thats still only about 20 of odds of a recession in 2018 chris, we mentioned the growth challenges over at ge just before we go, i see here you like the mulls pace where we saw a big deal happen possibly today between brookfield and ggp. Why are malls an area where you think people should be investing right now . Well, i think theres a big transformation everybody has been afraid of amazon and now were getting clicks to bricks its becoming a destination. Its becoming a service. Its becoming a whole different environment as far as the malls are concerned and what they used to be afraid of filling big box places like sears and now they got plenty of Fulfillment Centers wanting to go into them. I see a big change there with great yields. All right, sarg, before we go, what are you watching right now . What kind oaf levf levels is. We cracked 2,585 to the up side, point of resistance all day long we dont expect to go that far in the next 20 minutes of the trading session. One attempt to the downside against 2,585 and a hold all right good to see you all. Chris, thank you, holly. Thaurnk you. Sarg, thanks for joining us. Appreciate it. The dow, were up 33 right now as we begin another week here that will be busy, i think very busy in washington. The Senate Finance committee starting to mark up its tax reform bill and when we come back, well look at the potential changes. How the bill could affect your investments and which republicans may not vote for it. Plus well have much more on the fallout from ge. Were going to talk about what other big dividends in the market could be at risk and where those dividend investors that were in the name should turn to now. Of course, we always love to hear from you, reach out to the show here, various platforms, twitter, facebook, send us an email youre watching krcnbc, first in business worldwide modest plus signs for the major averages to begin this week the dow up 30 points was down 78. So theres a bit of a comeback story here this afternoon. And in fact, shares of chipotle have staged a comeback of their own today. After the company denied claims by active Jeremy Jordan that he was hospitalized after eating food at the restaurant chipotle says no other claims of illness had been reported at the restaurant where jordan ate. That stock now down just a third of a percent. I was there for lunch today so at that particular restaurant i dont foknow was it a new york one . Anyway, a news alert on dfj Venture Capitals josh lipton, what is happening there . Kelly, some big news out here in silicon valley. Venture capitalist Steve Jurvetson leaving his job at draper jurvetson in the wake of an investigation into Sexual Harassment, according to recode which has the letter ill read it, as of today own by mutual agreement Steve Jurvetson will be leaving dfj. Culture has been and will continue to be built on values of respect and integrity in all our interactions were focused on the success of our Portfolio Companies as well as the longterm vision for the firm and will continue to operate with the highest professional standards. The firm apparently did not specify exactly the reason for the ouster certainly jurvetson, kelly, one of the most well known, well respected Venture Capitalists out here friends with elon musk sits on the boards both spacex and tesla. We reached out to dfj for comment. Well bring that to you as soon as we get it guys, back to you. This is a more than 30yearold company now. Is tim draper even still there, josh its been, i mean, there have been a lot of changes at the top. There have been, kelly. Im not certain now what mr. Drapers role is here, but certainly with regard, Steve Jurvetson, listen, we interviewed steve on this network a lot, very well respected. Has his hands in a lot of different investments. I mentioned very close to elon musk, always followed musk into those investments, as i mentioned on the boards of spacex and tesla. We reached out to the firm to get their specific comments on the news here. Well get that to you as soon as we have it. All right yeah, its a huge name in the valley. Very much so. Tauhank you, josh. In washington, members of the Senate Finance committee are rolling up their sleeves and starting the markup of their tax reform bill. Lets go over to ylan mui with the very latest. Reporter kelly, this process is going to take all week long there are literally hundreds of amendments that could be offered in the debate over the next few days including a potentially major revision from finance Committee Chairman senator orrin hatch, himself now, there is wide speculation that there could be some changes to provisions in this code to make them temporary or perhaps less generous in order to comply with senate rules that prevent this tax bill from adding to the deficit after ten years. And that could potentially affect the Corporate Tax rate, and it could shift the political dynamic here in the senate now, right now, this bill is expected to make it out of committee, but its fate on the floor of the senate is less certain. Senator jeff flake of arizona is already raising some concerns about the impact of the National Debt meanwhile, youve got senators marco rubio and mike lee saying this tax bill doesnt do enough for working families theyve been pushing to increase the Child Tax Credit to 2,000 and rubio has said hes willing to vote against this bill if it doesnt do that. Over in the house, theres also still some heartburn over the state and local Tax Deduction and some limitations to that provision. You see representative leonard lance, representative peter king leading the carriage there shar dont want to see this fully repealed house ways means chairman kevin brady said hell reject the full repeal of the state and local Tax Deduction that is in the Senate Version of the bill but there are still tough decisions and tough negotiations to be had once lawmakers get back from thanksgiving break and after they make it through this week of debate back over to you, kelly. And were also mindful, ylan, the president comes back to town this week, hes already tweeted hed like, among other things, to see the top individual rate drop to 35 . Not to mention, he wants to see the individual mandate of the aca added to that bill and taken out. So, i mean, thats going to sort of, shall we say, add to the stew thats being brewed this week, huh . Reporter yeah, absolutely. So on the individual mandate side, this is something that had been actively considered on the house side there are several senators, i think we counted at least five, who have said theyd like to see a repeal of the individual mandate in the Senate Version of the tax bill as well however, there is a lot of concern that mixing the politics of tax reform and health care will just end up doing both of them especially after the elections on tuesday where the Health Care Issue is a major motivator for a lot of the democratic votes ylan, thank you. Tauhank you. Check back with you reporter thank you. Ylan mui in washington. Less than 30 minutes to go until the close. Do