Swing. Bank of america kind of mixed, Goldman Sachs sees a plunge in trading. The ceo blankfein may call it a challenging environment. A new hot seat of a new look at the an coventry trust risk to big tech the biggest reversal for the dow since february of 16th the blue clip saw 380 points trading range after hitting 26,000 for the First Time Ever s p 500 reaching 2800 before finishing lower. Jim, you said this time yesterday, you dont like big opens and midmorning you watched the transport starts to roll yes, it was surprising because really it was not anything happening there is nothing happening was yesterday based on unh being good it was anything that was reasonable oil going down and trades going in the wrong direction you have to base an opening on something other than gut and instinct it can turn against you. The market will come to you, there are people that want to sell there are people that want to sell right here. Theyre going to drill big and hope something underneath. They think these openings have little capital involvement i call them pa jam jamas trader. Not seeing any earnings thats making me feeling confident. What is it based on . Its got to be based on something. It is not like wow, things are good you cannot do that that does not work some work last night on dow days where you are up 1 , you lose the 1 and you close red. It happens 24 times in the cycle. A week or month or three months later, it is forgotten that can happen you go back to larry finks Conference Call of the ceo then he says one day well deaccumulate, right now we are in accumulation mode and that money trails off, you can say, i was looking at what happened over seas, asml reported great numbers, they make these gigantic bus machines. Bank of america was better than mix but that can be argued back and forth and goldmans. I want to hear something about something before you come in and buy it something about something i mean what this market is like it is a show for nothing and thats what we are looking at i am not green lighting this opening unless i got something to base it on. Well get into the next block of our show, i want to hear your thoughts yesterday, you and i were not able to talk about we got Bank Earnings this morning which we should get to as well and one more detail. Roll it down. Boa, 47 cents. They do book a 2. 9 billion charge from the new tax law. Goldman beats this environment in the release, he says with the Global Economy poised to accelerate, new u. S. U. S. Tax legislation providing tail winds. Suboptimal number Investment Banking is a little better you want to hang your hat on something. Seven points, not bad and under writing and advisory, they continue to be the powerful franchise when it comes to great advisers, it helps other businesses, too. We sometimes talk about it in of itself it is not as a large number as you may think. There is a lot of other things that can go along. Exactly right the one thing i would point out versing bank of america verses goldman. You get 100 base points. You are going to add 3. 3 billi 3. 3 billion to earnings for bank of america. Thats not going to happen for goldman. No. Bank of america regarding victory, should it be taken up the stock has moved up a lot pay 3 , thats better than wells and j. P. Morgan and not as good as citi which is a gracious buyer. Theyre not going to boost dividend dramatically. I like the course of action of bank of america. I know this is not terrific to talk about but there is a tremendous amount of option of the mobile and mobile is very good because it allows you to have your people at a branch to be selling products and the actual kind of just high cost cars thats being shipped through your mobile. I am not mobile. I am not mobile either. Social security concerns sometimes. If you talk to the guys in the fbi, theyll say dont do anything online. What do you call that, head of the fbi you do it all in cash at the teller when i talk to these guys yes. Ibm doubled up great today thats right. And barclays. Thats why i get up at 3 30. Are they kid sding let me just see that. Whei am giving a bridge, you have to put all of these together they argued the decline in revenue may end soon yes, the main cycle has ended and theyre doing quite well are we going to hear from watson dl watson can sit right next to us and do nothing. You dont go from bad to good unless you have a good incline that quarter tomorrow is going to be good i do many cycles at works. The stock is driven down by warren buffet. I wish it was not so much ahead of the quarter i want to go back to goldman for a second it was lagger last year among the financials as we know. Right they did buy back another 8 billion of capital of the common shareholders was returned. They decreased by 6. 2 of basic shares outstanding, a record low. Record low number of shares out. Well, they keep buying. 89 billions basically and i correctly, your one day fit can come back or they can be the cheap currency trader for kr crypto or whatever theyre great traders. Something already has which is the tax rate. Now, they took the hit for it. They did have a lot more over seas earnings perhaps to recognize over the size of that. Comp down over five years of some 15 and i mean 324,000 is still a fair amount of money again, Everybody Loves stick it it was the best record the worst quarter for fink and equi equity they obviously feel at goldman that it cannot stay this bad it cannot stay this bad. Right i think theyre right i want you to keep ongoing with the dickens solutions. What else have you gotten for me i have said over and over that steven king is our dickens. Got it. This thing, we are in peace i would rather take pencils and stick them in my eye than read that do you like the character of lebin . Thats one of the great characters the reports are getting longer overall amazon was 46 pages yesterday. Let me go into page 47 here ibm tax changes i dont know on page 72, i am really looking at a lot Teachers Pension Fund demanding kind of thing. Bitcoin is now below 10k which takes the route from the high to 50 . 50 . You know what i think is interesting . Bank of america is sticking by, why the heck do we need to trade possibly i think they are right they have a lot of consumer business thats digital. They rather not deal with the currency thats not a currency i am not saying that they think it is going to die i am just saying why the heck do we need this they got all the block change in the world. Bank of america get that stock of 35. Well, not now suddenly, it has changed look at whats going on with bitcoin at this moment down another 11. 5 i recommended in a good way since 2012 if you bought it all there. You are still up. You told me to recommend it 250 i forget. With that said, you would have sold on the first uptake, would you . You will take your bases out. A lot of these guys are saying this is when you double down are they doubling down who put at 19,000. That person is ready and waiting for the come back. I know. They should gotalk to bank of america have a look at ripple right now. Gee, thats platinum. I dont know what you are talking about kryptonite was really amazing, i dont know if you remember that. Didnt do good thing for super man. The latest on ge as it c contemplate with the break up of the company and well talk to alfred kelly and a lot more, three more days without a 5 correction on the s p 500 and it will be the longest stretch ever without one for the 500. Take another look at the street mark more squawk on the street in a more squawk on the street in a minute is what they hope to get out of life. But helping them get there requires a real refusal to settle for average. Because when you approach investing with a tireless desire to beat the status quo, Something Wonderful can happen. Those people might just get what they wanted out of life. Or maybe even more. Its abor it isnt. Ence in 30,000 precision parts. Its inspected by mercedesbenz factorytrained technicians. Or it isnt. Its backed by an unlimited mileage warranty, or it isnt. For those who never settle, its either mercedesbenz certified preowned, or it isnt. The mercedesbenz certified preowned sales event. Now through february 28th. Only at your authorized mercedesbenz dealer. Industrial production, lets get to Rick Santilli in chicago. Good morning. Although we did lose 3 10 of last month it was reported two and now stands down at 1 10. 77. 9 it is a steler number. Last month was higher, 77. 2. 77. 9 is the highest since january of 2015. So basically it is a threeyear high high still, a far cry from the 260 in todays high or the 260 on a yield. Carl and jim, david, back to you. I will take it, rick, thank you. Lets look at shares of ge this morning the stock was down yesterday after we got news in the morning about it, largely of an expected lost associated with run off reinsurance and longterm care policies and a number of other things in what was the legacy Insurance Business all of it was dispatched in 04 and 06 in the company. What we pointed out to were the comments from the chairman John Flannery, saying all options are on the Table Including breaking this company up into a separate part and as i reported, thats something that advisers have been wonderirking diligently it seems more likely enough to break up some of ge. You can characterize it in different ways aviation or power is separated or one business is separated out. It is unclear at this point as you may have imagined and a lot of technical issues around in terms of figuring out what makes the most sense but, theyre working on it and the status quo clearly is not an option, jim. The question is do you create value which at the is what flannery is focused on above all else no matter where it takes him. David, what do you hear from the three different divisions . I have not heard much the liability the question is, are there more liabilities of this ge Capital Legacy and assets. I hear no and this is a clean house. We heard it how many times. David, it is an i fog everywhere there are multiple buyers for some of these divisions but it wont matter if they cannot. When we look at some of the parts and you discussed in the past, estimates are all over the place and bank of america is up there and you got callan owen a very low number. When i talk to investors, they say listen, you are talking about a company that got consensus and you can make an argument that a third of that and signs are related, maybe you get a blended of multiples and aviation and healthcare and the question is whats power worth and if they can get to 2021 on some of the parts. The larger argument is we need focus and a Management Team thats focused you hear that a lot right now from companies and shrink to grow executions. Focus will help and capital location will help and new talent will help and ability to retain that talent will help you cannot just throw some of the parts if you are using a turbin order bases of 600 that you think is going to be 600 and it comes in from 150 to 200 how many people do you need . If the projections are so high, how big is the write off and who would buy it this answer is unless you downsize this thing to a point where it can only needs to have a small number of turbin built because that business is no longer a liable business as a large entity, who do you sell it to in. Right you can build this stuff. I am saying you order base is that the previous ceo use were wild high. Thats a business judgment that he made. You are going to start hearing auditing we are out of it and it is hard to imagine not many years ago moving towards breaking itself apart well, the healthcare does not blow the power now, John Flannery was able to do great things with healthcare. Everyone wants aerospace, power, we have to write it down from 600 to 150 i have no idea what that company will look like when they do that allison, what is it worth . I dont know. I didnt think anybody thought you were saying that all the twists. I do think David Copperfield is needed and i am not talking about a book i am talking about a magician. Well take another look at the market as we try to get back yesterdays big reversals. More squawk on the street in a moment and energy to fuel its growth. Real estate such as ecommerce warehouses. And private debt to finance transportation and infrastructure. Building blocks of strategies to pursue consistent returns over time from over one hundred fifty billion dollars in real assets. Partner with pgim. The Global Investment management businesses of prudential. Your parents have been ittalking about you for years. Theyre all about me saving for a house, or starting a college fund for my son. Actually, i want to know what youre thinking. Knowing that the most important goals are yours, is how edward jones makes sense of investing. Upeace of mind. S we had a power outage for five days total. We lost a lot of food. We actually filed a claim with usaa to replace that spoiled food. And we really appreciated that. Were the webber family and we are usaa members for life. [ click, keyboard clacking ] [ keyboard clacking ] [ click, keyboard clacking ] 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. All right, hump day comes early here we got 6minute we can talk about trading. I want to talk about apple it is bugging the heck out of me it is the worst of time for apple, they downgraded to say it is not great iphone super cycle. The super cycle is alive and well and china supports it david, i would say that long bow wants you to trade apple i am in the own apple camp. A lot of people felt that when it took out the top 177, it would move up and got stalled, i would warn people, look, the stocks had a big run and it is a big capstock i see no reason to doubt her work shes the best chinas source. You have been consistent and pushing people to own it rather than trading it. It is a Consumer Product story, it sells it at 13 times, 13 times the fiscal year of 2018 13 times, proctor, colgate and you mentioned gilette. Yeah, gilettes margins are really high and apples margin is really high it is sold at a higher margin why, i dont know i am gointoea ig lvet there. Well return more with you when we get the opening bell in a few minutes now. Stay with me, mr. Parker. When a critical patient is far from the hospital, the hospital must come to the patient. Stay with me, mr. Parker. The at t network is helping First Responders connect with medical teams in near real time. Stay with me, mr. Parker. Saving time when it matters most. Stay with me, mrs. Parker. Thats the power of and. You myour joints. Thing for your heart. Or your digestion. So why wouldnt you take something for the most important part of you. Your brain. With an ingredient originally found in jellyfish, prevagen is now the number one selling brain Health Supplement in drug stores nationwide. Prevagen. The name to remember. Weve been preparing for this day. Over the years, paul and i have met regularly with our ameriprise advisor. We plan for everything from retirement to college savings. Giving us the ability to add on for an important member of our family. Welcome home mom. With the right financial advisor, life can be brilliant. You are watching cnbc, squawk on the street, the opening bell in about a minute, busy wednesday morning as we come off of that reversal yesterday on the biggest volume since june if you take out expirations and month end, fascinating statistic. Yeah, that was a huge, huge day and you had the socalled reversal day, i know david does not talk about which the idea the market opens up and go down. This was a total return of volatility than fewer people expected good more goldman if he gets to volatility apparently they needed. The macro is coming pretty good today Industrial Production doubled the estimate machinery order nearly four times. I just think the banks [ inaudible when goldman is up and bank of america is up and citi is up and j. P. Morgan and wells was up at one point these are big leader groups. I like that leadership i did not like to see the transport. The big board this morning, Avaya Holding and celebrating its emergent of bankruptcy some of the second tier of Corporate News this morning includes tiffany of a holiday comp of five some say new bar for a new chief executive. Yeah, i was surprised if the dollar get weak, they do out macys maybe theyre just slowing expectations you got a couple of comings but not yet. I mentioned tiffany to ford because ford was supposed to do well at a weaker dollar and it is not happening we are talking about 20 increase of commodity points others are not seeing that. Ford is a little miystifmystifed fiat is going to do better than expected. Gm is not reacting well. I think these are nafta place, too. We need to hear more definitive oo on nafta, what are you hearing i am not hearing much what do you hear of the retaliations of the chinese . That got to be a central focus for investors as a real risk thank you it does appear on price report if the president s relationship of xi jinping is considered to be good. It is surprising a year into this presidency that we have not taken a more aggressive tact towards china. The chinese have seem to be well prepared for that event. Yeah, they do i kept on thinking that this would be one more time north korea would get in the way we sacrifice a lot of trades in south korea in order to send them in north korea. Now we got the chinese to do what we want for north korea and maybe we surrender our stieelers there is news today north korea will send a member delegation of 550. Thats huge news i thought that was so big i saw that and i thought why is this relegated and how are they going to do it in solemn thats like one of the most impressive things. It does say look, we are unlikely go to war while we are playing on the same team, right . One would think that. Right kind of like if norway were to declare war on sweden norway got one of a greatest olympic team, too. Plenty of oil and of a country of only 6 million people, amazing. It is interesting some of the stocks that we were connected with the wall street journal, against facebook, it is not really new this is factoring into, there is no real other than the break up of standard oil. Do we ever hear about what where we are going to go into concentrate. A great gift. On the front page story whether or not facebook and goo