Shares of ge sinking premarket on the heels of the biggest decline in almost a decade John Flannery will join us later this hour. Hurricane boost for home depot, raises full year guidance reports. Buffalo wild soaring premarket, getting a buyout offer from york capital. Well talk about that in a moment 7 drop, the biggest one day fall since 09 on monday they outlined the turnaround plan and announced it is cutting its dividend in half. Were going to talk to John Flannery exclusively later this hour lots to get to on the portfolio, on the influence of trian and dividend itself and what the message is going to be from here. Totally agree i think there are some issues about the way they are going to build the cash flow issues about the way 2018 is supposed to go and yes, theres a bit of a truth in reconciliation needed about how the company could have been so wrong about its own numbers in 2017, about how to tend to switch to real acting as opposed to the suboptimal form of accounting. Theres a lot to be here, a lot to be asked how quickly it can really turn. I dont know, david, if you feel it, but there were lots of gaps in the Conference Call where people really didnt you need to take a leap of faith and im done with the leap of faith. I think its funny in speaking to a couple of investors over the last since the call, they are unsettled i think there had been an expectation coming into yesterdays meeting and perhaps it was unwarranted, that a lot more questions would be answered and i think coming out of it, the best words i can use are unsettled in the sense of people just dont feel like theyve gotten the answers they dont know, yes, it is a reset and you can work your way up from a buck in earnings next year and hope theres a Significant Growth rate attached to that for 19 and 20 that will argue for a higher multiple, but we dont even know who the Board Members are coming off and going on. Yeah, the board has to be challenged on no, everybody from the board should go thats not happening. No. But somebody specifics to that point, were going to get from 18 to 12. They checked off on what i clearly think is suboptimal accounting, they checked off on the dividend and cash flow shouldnt they look at themselves in the mirror and say, you know what, we checked off on a lot of things maybe we dont some of them are, just dont know which ones are looking in the mirror and which arent. Its kind of like broken mirror i would like to know more. Maybe they should have delayed the Analyst Meeting until they had a bigger picture. Heres sound from the meeting. Listen. Lots of strengths, we have not performed well for our owners i said this on the Earnings Call and say it again today, that is unacceptable and the Management Team is completely devoted to doing what it takes to correct that. So when you say holes in the Conference Call, you talked about some questions about what else . I think id like to go to the guy who jeff immelt ridiculed on mad money, the fellow steve tusa has a list of a lot of questions which i think are very right how will you come up with the cash flow and if powers really worse than expected, how are you going to get that to be better than expected. Theres just can you grow power in 2019 . I think it drew a lot of questions about 2019 this is one of those lets use the nfl as an example, but they are a pretry rigorous organization this was a equivalent of a coach coming in, we have a bad season, were going to lose games, stick with us. When coaches come in in the nfl, they dont say that. Listen, were going to turn it around i feel like this is one of those where i start worrying about 2019 after i read it because i dont know how they can do it. Then of course, theres nelson peltz and the degree to which he helped precipitate a lot of this. This is peltz in october with jim at net net telling a story about talking to a room of ge shorts and hedge fund managers. Heres what im willing to do, take the price of ge stock at year end, take two years or three years. Ill take the over, you take the under and ill book every bet in the room just stand up and come on up and tell me how much you want to bet and well shake hands on it. Nobody showed up really . Nobody showed up. 50, 60 hedge fund guys, nobody showed up. Lets piece that ouxt end of year price, pretty good idea two yeerdars pretty good idea ed garden is one out of 12 but we learned that one out of 12 can be whoa. Flannery you can argue hes also one out of 12 on the board. The other ten i want to take back what i said. I think those people are very nice, they are nice people any college board, david. Trian, this has not been a good investment to say the least, after a brief runup, not that brief, the stock hit almost 30 on the positive impact of potentially of the sale of ge capital, which took place not long after they were arguing when you look back at trians white paper, of course, for what might have been a stock as high as 45 bucks a share, over 2 in earnings for next year. Next year. And its going to be half that thats kind of like what you have to hope when jeff came on mad money, the stock was at 30. You know, a wiseman once told me, sometimes you just get had ive got had hate be had. You like be had . I dont like being had what are you doing over here . Im doing me. Youve already worn the harry shirt on ge for a while sounds like youre quoting a movie. It was an actor that told me that. Yes, two time oscar winner. When the stock spiked on this initial flannery news, you did tell people to wait. That was ill advised, i try to get people to take advantage of the pop when youre not showure about a dollar number, its questionable said its not going bankrupt. I heard him say that. That was reassuring. Listen, theres a lot of People Living on pension from ge is helping provide the way they live and they are worried about it. There are great businesses, the service business. And that dividend of course rely on social security, give me a break but, look, there were aerospace, Like Health Care david, i like okay thats it. Its something. You cant split them up yet because theres not enough cash but look, im just trying to warn people that this is a lot of heavy lifting where did i get that term . Massive heavy lifty . I dont know. Cvl. And i think flanner are y iso it end of the year, two years, im on board for that. I think garden on the board from trian gives a chance for flannery to be tougher should john brennan still be the lead director . Youre in a transcript you cant hear you because youre going like his. No. Yeah, i mean, when they im not going to be facetious, this is a troubled situation i do think flannery is the right man and he did health care its just the hand he got is really a busted straight and its tough you have to kind of throw it back and get in a couple of cards theres an ante, any anlcy to see 18, 16, probably 18 because thats a big multiple and i think theyll beat the number thats first time i thenk they did an underpromise on earnings. I do like aerospace. They are stuck with power. They can say however they want how good power is but i dont think they dont know, dont even know their own accounting they dont how many years of accounting do you have to take to realize this is accounting. Its not acting. What is it this is what he has to answer, what is it we took that class we hope he will answer in about a half hour, 20 minutes. Stick with us for flannery onset. Home depot raising full year guidance, better than expected quarterly results, helped by a 7. 9 in comps. Increased sales from the hurricanes but due to lower margins and additional expenses related to the hurricane, impacted by 51 million. Go sell it and regret it. People will sell that and regret it that was a great comp. The company will have a good quarter. Reaffirmed, maybe theyve sold this down every single time. Then you look at it four weeks later and its up. Thats been the pattern. I think that pattern will be completed because they are one of the survivors a. Mazon hasnt gone after them i have to tell you, amazon can get the chipper shredders as fast as they can, steve busscemi, remember that scene . That was a wood chipper. But i think that this Company Performed incredibly well and i think that sold down and everyone who blows it out, will have sold it before carol tomei and tells you exactly how good they are selling it now ahead of tomei. It is down so is dicks which raises a beat on comps. They had that lower of the comps and i didnt like that even though quarter was a decent quarter. But they lowered the comps. Tjx, which everyone is selling, you know didnt include puerto rico they included puerto rico but no sales in puerto rico versus last year and the weather was really bad that doesnt matter so much for the home depot they are going to do a lot i think selling home depot ahead of the Conference Call has been time honored and carol tomei and great team comes on and why did i sell then you sell more because youre worried about amazon. Right, well, everybody is worried about amazon in everything. But every single thing. Amazon cant private label a lot of stuff on the shelves at home depot i guess. They can batteries and theyve done it. Christmas for Home Depot Holiday season for home depot is basically the spring and why is that because you buy plants when amazon starts shipping plants, im going to rethink my analysis. I would assume they will. You think so . Dont you wont they try no. Theyll be dropping plants on you how is it different than groceries. With their drones. Deliver those plants every minute. Heres your tomorrow tomato plant. You really fear amazon. You think amazon will come after ge power turbines . Sure, theyll drop those out of the sky too they pronounce it turbines. They dont do the sam accounting and same pronunciation. Weve got to go. Weve got to go when we come back, our exclusive with ges John Flannery here, hell join us exclusively at post nine. Take another look at the premarket s p 500 avoided first threeday loss since august. Although were looking at the down premarket back in a minute gglobal bonds, and highdividend strategies. Sure, these are investments. But theyre not what people really invest in. What people really invest in, is what they hope to get out of life. But helping them get there takes a pure focus. Because when you invest their money without distraction, hidden agenda or competing interests, Something Wonderful can happen. They might just get what they want out of life, and maybe even more. Busy morning in the bond pits good morning, rick. Very insightful day, we get a hot pti in the form of wholesale inflation but of course well see if it transfers in, just to look up at the boards now to give you an idea, weve had a little steepening over the last week or so but not today. If you look at twos, they are up one, fives are up one. Tens are down and you can see right around 8 30 eastern we popped a little bit, but it didnt have a huge effect like last month when the september hot readings came out only to be doused by the following day cpi. Will it be that way tomorrow well have to wait and see were now holding for the most part above 2. 40. We want to Pay Attention to 2. 44, the close for last year. Back to the yield curve, tens minus twos hasnt moved a whole lot but 30s minus fives, these are ten year tights for these major yield curve flattening spreads. If we look overseas, one of main reasons we popped, bunds on this one week chart have he is ka it escalated. If you open up to april, you can see how important it is. We have higher lows in terms of yields and traders are paying attention to that. When you consider everything the ecb is doing and the notion that theres actually reforms going on in parts of europe like france, maybe theyve taken away some of our thunder which means italian and spanish tens may have upside here if you look at a twoyear chart of the italian tens, they are lower yield by about 60 basis points but maybe they turned finally we can talk about the dollar index but thats not the hot gun trade, its the euro versus the dollar. Were at 1. 17 almost at 1. 18 never traded down to 1. 14 and it seems to be rates firming in europe, not a lot, carl, jim, david, back to you. Rick santelli, still to come, cramers mad dash and count down to the opening bell and shortly after the bell well talk exclusively with ges chairman and ceo John Flannery right here at post neni more squawk on the street is straight ahead is the monolithic view of emerging markets obsolete . At pgim, we see alpa in the trends, driving specific sectors of out performance. Where a rising middle class powers a booming auto industry. A leap into the digital era draws youthful populations to mobile banking and ecommerce. Trade and travel surge between emerging markets. Everyday our 1,100 investment professionals around the world search out opportunities for alpha. Partner with pgim, the Global Investment management businesses of prudential. [ click ] [ keyboard clacking ] [ clacking continues ] good questions lead to good answers. Our advisors can help you find both. Talk to one today and see why were bullish on the future. Yours. Weve got about eight and a half minutes before we get to the start of trading this morning. Lets get to a mad dash. Where do you want to take us i want to go to caterpillar i want to contrast this with ge, only just because this is one of the moments where, look at this. This is a company by the way at 60 here at goldman downgraded it there. That was illadvised but what happens this morning we get retail sales, october was retail sales for caterpillar, 19 versus 13. Im trying to put business in context. This is the resurgence of american manufacturing, theoretically ge should be doing much better if its the vertical caterpillar is doing great a lot of people feel it may not have been fair what do you mean . That it moved up too fast and business hasnt turned as much what you see is leverage here. They let go of a lot of people it will fall to the bottom line. Caterpillar, 13 in september, going to blow out the quarter. You think so. Blow out the quarter. Had a couple of strong my theyve had good quarters and these earnings estimates have to go up tomorrow and i think they will and the stock breaks through 140 ges industrial business which is largely aerospace, military is very strong its just that you think of ge as an Industrial Company and they mucked it up when they bought allison and im sure they wish they hadnt bought oil and gas. Caterpillar has some oil and gas. Speaking of oil and gas, were going to be joined by John Flannery, the chairman and ceo of ge very soon. Well get the opening bell coming up after this why did you take Credit Card Debt on . Second kid. Private school. Medical bills. Moving costs. Solid ground. A personal loan from sofi is a smart way to consolidate Credit Card Debt. Certain borrowers cut their credit card Interest Rates 42 and increased Credit Scores 17 points on average. Borrow up to 100,000 with low rates and no hidden fees. Find your rate in just two minutes, and take on your debt at sofi. Com. Allow you to take advantage of growth opportunities. With a level of protection in down markets. So you can head into retirement with confidence. Brighthouse financial established by metlife. Youve watching cnbc squawk on the street. Well talk to John Flannery in a few moments here at post nine. The president has left the philippines where he says hell have a major statement upon his return inflation running a little hot after the biggest year on year jump in five years in september. Now weve got another one. Look, i think i thought the Interest Rates would go up, i dont know what moves Interest Rates. Ho holy cow, germany is running really hot and havent made a move yet, the central bank there. Theyve been sticking by, 3. 3 for germany. They should raise rates quicker than we do. 3. 3 is not bad. Pretty good i think keeping the rates at zero is an attempt equivalent is an attempt to try to keep the euro down. Good look with that. I dont think you can keep the euro down. I think euro will be really strong because europe the continent is very strong ive been saying that. You have for a while but europe has been strong i said it ahead of time. A couple of years ago you were on that one i remember disputing it saying come on youre nice thank you. Youre nice like the board of directors at ge, nice people. Meanwhile, theres been talk about sentiment sagging a bit and apple looking at the fourth day down and bit coin volatility, the b of a fund manager says ik russ flies closer to the sun because of cash balance maybe its salmon Hercules Atlas zeus you can buy any of this. The bank stocks have come down consistently, they are getting interesting though i think retail is coming down, getting interesting. Tech has not come down yet you can argue it should come down but its a benign period, we had a really good Earnings Period and stocks are selling off, not much to do you know, you sell the market and you say well, listen the restaurant the world costs are going up, price of chicken wings going up even the ones that have the little thing we had David Rosenberg yesterday sorry, well get Buffalo Wild Wings. People are worried about the multiple we had good earnings and earnings are high but so is the market its not like one isnt going along with the other there seems to be some concern, high yield is starting to back up a bit. I saw that. Did you see yesterday mattel bonds, listen hasbro we like you. Well see what happens there. I think the market is coming in rather gently i dont can it keep going down actually, i dont want people dont understand this who just Retail Investors dont want to hear this. I want it to cool off. It got too hot want it to cool off, just you know, kind of like a grill, its like a griddle if you keep the eggs on buy at home depot. Yes, you keep them on for nine seconds, bingo but ten seconds i did buy a grill from home de