Largest ecommerce be the in what could most valuable tech company. Meanwhile violence in ukraine is spreading to other parts of the country, alleged prorussian separatists killing ukrainian troops. Aev says it is turning into real bore. All of that ahead on street smart. Lets look at these stocks were watching as we head into the close. I want to go to julie hyman. I want to start with pfizer. We have seen so much activity in the drug sector. They failed to make more than estimated. The ceo talking about what could happen if you see that big pfizerastrazeneca deal go through. They are talking about the implications for any potential rake up of pfizer. The Company Thinks it would possibility. Our lesley they would have to reject or how that would be done. Obviously they would have to the way that would be done. And foreign sales were influenced by an outbreak of bird fuel and china. International chicken sales really felt the pain from that. And finally we have the potential deal, looking for a deal in the aerospace industry. Airplane seats saying it has hired an advisor to study options including the sale and the flows of surprise, and those shares are trading higher. Ok, lets move on to our big story. Targets reputation redo. The companys ceo has stepped down. You have the chief financial officer, John Mulligan, stepping in to serve as the interim ceo. This comes five months after the companys massive data breach you all remember that. Happened around christmas time. Hackers store the guard data and personal information from as many as 70 million customers. Changeanagement influence confidence . I have it all covered with my panel. John rico from the atlantic group. Good to have you all here. What has it done, really to the company and the company business, the fact that this happened . To me as a consumer i am less likely to shop at target now, even though i may not be more vulnerable there than any place else. How has this affected things . We know that target rockets fell off meaningfully in the weeks after the breach. When theyted that reported their fourthquarter results. They also reported that sales would bounce back not to prior levels, but they did bounce back. Inget has many other issues addition to the credit breach. My suspicion is Gregg Steinhafel leaving the company is the result of all of those issues. All of those . To me, this is any ceos worst nightmare. You look up the next morning and you are reading the headline in the papers and online, all about how your consumers were effectively violated in this situation. Thiset me point out could have been prevented. The company had mechanisms in place to forget Something Like this and didnt. Scott, are we seeing, scott, the fallout from this . And will it change Going Forward . An excellent point. After this breach, everybody is revamping their plans, saying, hey, we have to put things in place immediately so this does not happen, so we are not the next target. One of the complaints that i hear, john, a lot, when it comes to security spending and ip spending, it comes after the fact. Money ond to spend something that is never seen as a profit center. It is a drain, because youre putting money in. Will that change . I think it has to. You see a lot of searches for i. T. And they always seem to come after the fact, dont they . Then they try to fix the infrastructure. If they win out in front of it, i think that would help. Big securitya conference around this time last year. One of the things that the people on the panel were communicating, sometimes you are in situations where ctos are not necessarily the best communicators with ceos. They are tech guys, right . They have a different way of talking, a different way of presenting. What if the things i heard was if you have ctos who can put the stuff into basics, that makes a difference, because then ceos get how important it is. Good point. They have to simplify. If they talk techy, it will never happen. Target says they are committed to spending 100 million on technology upgrades, Cyber Security protections. It is late in the game. We are talking five months ago this breach happened. Companyentioned this has a lot of other problems, too. Some of the other problems include very weak, to say the least, start to their business in canada. They opened their stores a year ago, well, well below land. Five quarters of negative traffic in the united states, prior to the breach. This did not help. This was the nail in the coffin. Will a new ceo reverse this trend . Consumers have many years of good experience with target. They have had articles in many weeks about how targets handling the crisis they have done such a great job of communicating to consumers. I think that is an exaggeration. There is a reservoir of goodwill towards target i dont know about that. I did research into this. If you go back to 2007, it happened before. In 2007. D a breach you know what . They did not tell me one unsold 2009. Part of that is the way the current law exists. Retailers are not required to tell customers. Maybe that needs to change. Right, stock scott . And look at the timing, going into december, the shopping spree. He could not have happens at a worse time. They were slow out of the gate to inform consumers. Their point off are upgraded. They were very slow to react. This was first reported by someone in the blogosphere are and then they had to confirm it. It was not like target came out and said, hey, this happened. I think they were thinking other corporate interests and wanted it to go away. If they could have, they would have. But in fact, you have a bigger problem by not communicating. We certainly saw this with gm. 10 years sitting on information that could have saved lives. Lets talk about the ceo position. We have an interim ceo. What is going to happen now as they progress in the search . Its going to be interesting. They are going to have to find someone who is up for a challenge. Inthey already have someone the security field. Someone who works in security now coming your reaction to that . My reaction is, i met him years ago when he was at home depot. Presumably he knows a lot more about all of this than the prior person in charge, who was quoted in a trade publication a few years ago in minneapolis saying you do not need to have a tech background to be cio. Ouch. Oakleys coming to the table with a little bit more. He is 63, and i believe the retirement age at target is 65. The last ceo retired all, a mandatory retirement age. Ok, they are looking for someone younger. I think they will go to the outside. Someone who has maybe handled some crisis experience. Mining Companies Short certainly has challenges in front of it, most importantly restoring consumer trust. If anything, i think it highlights how important security is. Thank you to my whole panel. The most highly anticipated ipo of the year and alibaba could price any day this week. Should you be bidding on shares of you have the chance . And one of the most persistent and forceful buttocks of the federal reserve. Forceful critic of the federal reserve. Jim grant is going to be joining us. We will also hear from bill ackman. Very big day here. I will be right back. All right, this is street smart. I am trish regan. This week Chinese Internet Company alibaba may file its perspectives its for an ipo. It is going to be big. Potentially the biggest since facebook in 2012. It has a lot of users. 500 million at the last count. Alibabas ipo is worth paying attention to. It has huge significance. It will be critical in terms of the test of the chinese economy and most important, Investor Sentiment amid another tech boom. I break it down for you and my column on usa today, why alibabas ipo is such a big deal. Here with additional perspective, we have michael block, david rito, our bloomberg reporter, and our bloomberg west editoratlarge, cory johnson. Great to have you all here. Lets start with evaluation. What are you hearing, leslie, in terms of what this might go for . We are told this is the biggest ipo ever to hit the u. S. Bigger than facebook . Bigger than facebook. With a 12 slow that is the 12 they will sell in the ipo, billionlots 20 ipo. Facebook was what question marks about 18 billion. This is pretty big. But if you look at the evaluation, drew cory johnson, and compare it to, i dont know amazon, which is trading at a pretty high pe, it is not worth as much. You are talking about a company that would be worth far north of 168 billion. Really know yet how solid the financials are, even what profitability there is to the company. I think first of all, any conversation that begins with if we compare the evaluation to in the you are already wilderness. Amazon has a crazy valuation that is a thing unto itself. But we are talking about amazon combined with ebay combined with google. What this represents maybe something much bigger. I will throw in twitter for good measure. And weibo. It is unique. It has a very different structure, unlike amazon for example, not needing to take ownership of the inventory and have those relationships. It has more than ebay like relationship with suppliers. Very different. I think some of the Big Questions are going to be how ist is a growing and what the Free Cash Flow . We know it is growing fast, michael, and we know it has a tremendous user base. At 500 million that is the economy that, while it has load, is growing north of where we are growing at it. Do you think there is a discount at all because it is chinese . I am not sure there is a discount. There is global demand. Talking about the evaluation, that number could be dwarfed by what happens. There will be demand all over the place. Whatever valuation metrics to use, that would give buffett nightmares. You want to save ballpark, 500 billion next year fine, slap a 50 on it. People will not be looking at it this way. Would you buy this . My concern would be Corporate Governance. A funky structure where you have minority shareholding but majority control and you are investing in a contract which is in terms of the variable interest entity. So, i think the operations are great. I think the Market Positioning is great. The evaluation could be whatever. But people have to stomach that you are buying in a legal way to skirt state and chinese law back it up. If i am an american investor, i kind of like the idea it will be subject to american rules. Lets face it. Our Capital Markets last time i checked are still pretty supreme. Part of that is the transparency we offer that other markets just dont. To this point, you will not be investing in this company directly. You will be investing in a Cayman Islands sunseri. And not even a Cayman Island subsidiary of alibaba, a subsidiary of the hong kong subsidiary. You are so far removed but they go public in hong kong, right . That is the thing. Even by hong kong standards, the notion the u. S. Is the best market for the best Corporate Governance is just not true. Here we have the Hong Kong Market applying a higher standard. Alibaba has been public before. It did not do so well. Did not do well. Listed in hong kong, only the adr traded in the u. S. , and the pull boxes the ipo on the pennies on the dollar. Now he is offering again at a higher price. Does that make you reluctant and anyway, knowing it they go public before, was not a Success Story . He is trying again. By the way at a time and what leslie will tell you this the ipo market has been on fire. Stocks have suffered, but certainly saw a huge growth boom. Are you concerned . My concerns are more what this means for the chinese stock market and Global Stock Markets in everything else. We have seen china come in based on this huge ipo backlog being improved at approved. There is this vicious cycle where the weaker market does not mean it will be interested in the stock. Im not worried about the interest here. Im worried about the reflexivity. Thank you for all of your perspective. Leslie, cory. David and michael, you are sticking with me. Is it time to bail on china, or are the chinese pockets of opportunity there . Thats coming up. Talked of the slowdown in china continues. Today marks the fourth straight month that production in china has actually slowed. Our growth concerns are theremate threat or are opportunities in china . We want to welcome michael block and david reidel. David, i will begin with you. Report after report after report. It seems that china is slowing down. It seems to be going through an important transition, but it is is it a transition nonetheless . As workers demand more in terms of wages, etc. What is your feeling . They absolutely do have to go through a transition. They have the fastest aging population in the world. They can no longer be the low cost eber leader in workshop for the world. They have to go through this transition. They go through it with considerable assets and strength. They have a tremendous warchest. They have complete control of the Banking Sector and the ability to implement their plans. But they definitely will hit these air pockets of growth and air pockets in terms of momentum. A differenting to china. Infor all of the pluses china, you are still dealing with a society that is highly bureaucratic and highly corrupt. As an investor, how do you think about it, michael . Here is the thing. David talked about the word control. Lets focus on the word control. I have always said if you are talking about the chinese central bank, they have tremendous leeway to do what they want with the economy. Do you like that . Im not saying i want to live there, but as an investor, it is interesting. Look at a place like singapore. A different animal than china altogether. But guess what . They cut the economy going by turning things the way they wanted to. You look at this number. Low is the fourth month the 50, which means contraction. China wants to spur gdp. What are they do . They can build some more, right . There are cities there no one lives in. Part, trish, that is the i of that equation. Atyou can throw money people, but its a sectoral change. You cannot get them to spend. It reminds me of older relatives who used to send me five dollars bills. It sounds like the u. S. Economy. How do you get corporations to spend when they do not believe in the recovery . Is exports. Saying that they are going to debase the currency. Unfortunately am coming up against a heartbreak. David reidel, thank you for joining us. Next up, we are talking to an outspoken critic of the federal reserve. Jim grant, coming up on the show. All right, it is time for the hnth annual phone so conference where investors gather to exchange ideas. We have heard from a number of different speakers today. Iselieve bill ackman speaking right now. Among the big calls we have had, one of the interesting ones Larry Robbins talk about the essential for a company like monsanto. He says the demand for organic food, there is not enough to meet it, so thats an opportunity. He highlighted humana. You tend to see reactions and stocks the day off. On the day itself, you do tend to see reactions in these stocks. Jeff gundlach talking about the Housing Market and the era of homeownership in america may be coming to a closer turning a corner in which it is not as affordable for people to buy their first home. Hb,recommends shorting the x the homebuilders etf. We heard about buying liberty global. He thinks that vodafone will make a bid for the company. Pretty market moving . Pretty market moving. I was looking at the record of some of the people from last year. It has been a mixed record. One of the better performers, Jonathan Jacobson recommended a short of realty trust and the shares are down 20 . Another said sure aaa and that stock is up 30 . You take the good with the bad here. Much, julie very hyman. I want to go to Market Makers anchors Stephanie Ruhle. Hey. Horn playing extraordinaire, jim grant. I had to start with that. Jim, you made news, you made waves on gazprom at a time when National Resources in russia, many people are shying away. Why are you in . It is the beginning, middle, and end good things happen to cheap stocks. By acclamation the worlds Worst Company managed by the worst click of kleptocratic ever assembled on one continent. So and jay carney, the president s own press secretary, as a nation to go sure this stuff. So how can one not investigate the contrary side of that proclamation . All right, so you investigated it. First of all it is a huge company. They are in a lot of money. Even after stealing, they earn a lot of money. They pay a five percent dividend. As recently as 20 oh six, the stock changed hands at 10 times the estimated earnings. Is that 2. 5. Why is that . Because people know there will be even more extreme and costly sanctions imposed on russia. They know something terrible is going to happen with the ukraine election in a couple weeks, and well it might. There is certitude about outcomes that is notable, given that so few people saw the current set of outcomes approaching a few months ago. Addition to the epigram that good things happen to cheap stocks, i will offer this epigram. Too, will pass. Really . What is the time arise in . For time so what is the arising . For those so panicked about russia, ukraine . You cannot care about the time. You cant care about the time . If you are not in deference to the amount of time, you must profess to be. We do not know when it will work out. But we do know i think we do know solvay companies, are you ok . Companies are you ok . Solids a terrifically balance sheet. There is not a clock ticking on ,he business by dent of debt and we think that solvent businesses do not trade at 2. 5 times forever. In the fullness of time is my time arise in. You wrote about puerto rico. What is your current view . We are a little embarrassed. We started out a year ago jim grant, bearish on puerto rico . We started out a year ago saying, how is it this thing trades above par when so clearly our fundamentals are cracking . Then the bond market, somebodys alarm clock went off and said, their credit is terrible and indeed it was. We have analyzed the new perspectives. We have looked at the rumors and substance of the talk of restructuring. We think th