Its called a tsunami move. The swiss bank stunning markets overnight scrapping the peg against the euro sending its currency soaring up 10 against the dollar now, but it was up as much as 30 right after that announce. Check this out. Gold moves on the swiss move this morning. The last trade on the gold market is up 28. 5 on the trading session. Sarah eisen is following the story for us here with the move that stunned markets all the way around the world. Shocking policy uturn. This is what happened. The peg, were talking about, was put in place three and a half years ago to keep the swiss frank from being too strong hurting exports, a key part of the economy. This goes back to the european debt crisis three and a half years ago when people just could not get enough of the swiss franc. What they did, they got rid of it today. Why . It was becoming very costly. It was reeking havoc on the Balance Sheet of the central bank, building up more than 500 franc in reserves defending the line in the sand. Why now . Thats the interesting part. Many suspect its because the European Central bank in europe will pull the trigger for quantitative easing stimulus only leaving money to rush out the euro and into the franc, not to mention the fact that the crisis in russia mass exodus from the russian ruble is a beneficiary. This is making it much more difficult and much more expensive for the swiss bank to defend the peg it promised to defend. The view is the central bank did not want to risk credibility down the line or spend hundreds of billions more in keeping it level so it scrapped it and bottom line switzerland made it clear the market takes control from here and, boy, did it take control. In a big way. 30 . Its unusual to get 2 in a currency, but 30 is unprecedented. Yes, its settling down here at 14 , but, still, thats huge and rarely see that. Wouldnt want to be a multinational like nestle dealing with this, and the ripple effects of a stronger currency in the u. S. Its interesting because when Steve Leisman interviewed imf minutes ago, they gave the indication that the she was not notified about this. Yeah. She was surprised she was not called. Usually they talk to each other. I dont know about that. Will be interesting to see whether or not they contacted any other central bankers. I think the message there is policy coordination, something the imf made clear is very important. Yes. On a global stage, and something that imf chief made very important, and policies are diverging and surprise and thats what is creating volatility. Thank you, sarah, youre doing it all day. Back to you. As you mentioned, sue, steve spoke exclusively with the imf chief about the swiss move. Steve, the thing getting our attention was as sue pointed out, the imf was not given the heads up on this. Tyler, listen thats the sound of the Swiss National banker telling the imf hes gout to make a monumental change in currency policy. I mf chief was none too happy about itment investors did not know currency traders did not know, and the imf did not know. This is what she just told me. This was a bit of a surprise. I would hope that it was communicated with other colleagues from Central Banks. Im not sure it was, and, you know, im going to reserve judgment on the pertinence of the move because we have not discussed with with governor jordan. He did not contact me which does not mean to say he has not contacted somebody else in the organization. She also said she hopes other central bankers were contacted, but she did not know. Whats important here is what sara eisen said. They took every opportunity she could possibly find to tell central bankers that if youre going to change policy, key thing here is to communicate it. Now, there was a very legitimate question as to whether or not the Swiss National bank could have at least publicly communicated a change when it came to an Exchange Rate typically Exchange Rate changes are done very quickly with no advanced warning from a central bank because once you announce a change its the same thing as doing it. I want to move on to one other thing the imf managing director told me which regards the issue of oil and lower oil prices. Is it seen by the ifmf as a benefit to the Global Economy . We say its a net positive, but we are seeing a Great Variety across the map whether you are oil producers, oil importer currencies pegged to the dollar or not, whether you edged against the currency risk puts you in a completely different situation, but we are still seeing on a net basis, a positive outcome from the decline of oil prices. That does not mean, tyler, we are not seeing serious gyrations in the Global Economy as we adjust to lower oil prices. Sue . All right steve, thank you very much. To josh lipton in Silicon Valley for a news alert on google josh . Well sue, dow jones reporting news on google glass, that 1500 dollar wearable that google will stop selling the first version of the glass device and close the explore program on january 19 th and release a new version of glass sometime in 2015 also reports that glass will exit google x, the famed research lab, and now report instead to tony fidel. What seems to be more faith and confidence in the cofounder, google glass, the hope is it may find specialized used cases, but will it be a real consumer hit . Thats the open question. Sue, back to you. All right, josh thank you very much. Lets talk more about the impact of the Swiss National bank move. S sara is here as well as michelle carusocabrera. The question now is, what comes next . Well i think what happened today is emblematic symptomatic of human dislocation to expect as a result of the unprecedented Economic Times were in right now. When we see the u. S. Potentially unwinding, though we are not sure yet and the European Central bank winds up for qe we push capital to places we have not gone before and the Swiss Central Bank pushing to a place that they could no longer tolerate, and i think investors have to expect look whats happening with oil. This is another example of the unwinding of something, and perhaps the revving up of Something Else and unexpected events are going to be big and a lot more frequent than over the last couple years, sue. You know sara a lot of people use the words currency war, i dont know that its a currency war yet, but theres gamesmanship going on out there. No question about it. Central bankers are in control. What we saw as michelle laid the table for divergance in Monetary Policy, thats equivalent to massive trades and moves in currencies. Thats how you value a currency relative to another currency by what that central bank is doing. That means youre going to see a lot more currency volatility, something we already see as we have divergences in Monetary Policyies heating up. The question is, whats the response . When you say currency war, youre talking about a central bank taking action like india did, for instance overnight. Overnight, cutting Interest Rates to keep down their currency or fight deflation. Youll see a lot of these moves as currency moves become extreme. You know this comes, michelle, as you well know, ahead of the ecb whats expected to be qe. What if they disappoint and does not do what the market some say factored in or is expecting . Yeah it would be a huge risk, and you have a lot of Euro Currency risk, right . To get back to the idea of the central bank move today, if youre a Swiss National and live in switzerland, your shares got hammered today. You really suffered. If you were an american and bought swiss stock, guess what . Youre still in the green because the swiss franc appreciated so dramatically against the u. S. Dollar so its a teaching moment. As i said last hour the impact of currency and could see that again if they disappoint. We already see people leaving euro denominated stocks and moving to dollar denominated stocks believing the dollar will be stronger. The economy is better, stock is better, and then the currency is better too . Wow, a real winner. Thats what we watch for with the ecb decision next week. Steve, the final word does it impact the fed in any way, shape, or form . It does. Step back and think about the last time any one of my colleagues there sara or michelle, can remember a surprise from a central bank a major central bank. Weve been living in a period of Forward Guidance where its Central Banks telling us what they are going to do and tell us its going to be done and then do it and then tell us why they did it. Or at least a hint. This is the first major surprise i can think of and in the world of Forward Guidance when Central Banks try to rely on market guidance the idea that markets now live with the possibility of a Monetary Policy surprise could hurt the feds and other Central Banks ability to use this Forward Guidance tool in the future. All right, thank you, all, so much, saras, michelle steve, appreciate it. Domm . Away from euros to oil filled services slumber jaythey raise a dividend to 50 cents a share, 25 , down 1. 2 , but there was an uptick as the announcement was made. Back over to you. Thank you so much. More on the swiss move with scott collier, and tom, Portfolio Manager at lk balance funds. Scott, you like european equities tips these are inflation protected securities, even though theres no inflation inflation, you like Precious Metals metals, and copperss at a multiyear low, and you like emerging markets like china, india, and brazil. You qualify as a contraryian. Explain your case. I would. Along the way of European Equity equities equities, the u. S. Markets, the time period where you want to be in on it qe starts here qe started in japan, a marker you didnt want to be in in the japanese market. Europe is no different. I think, quite frankly, qe is a good entry point and tends to work well on asset prices so we tend to go where the value is the values in europe and the swiss bank knows whats coming from the ecb, and probably acted to be in front of that and they wanted to be in front of it. I think thats basically how i would see it too, they wanted to protect themselves there. I want to come back on tips in a minute. Sure. Tom, turning to you, your equity choices are much more close to home disney berkshire, why do you like them . Oh were much preferring staying in the states, the stronger dollar continues for quite some time and somewhat a different approach than scotts. We like to stay in the states and specifically prefer things that are more dollar denominated, catos a great example, sourcing costs are going down all u. S. They have no International Exposure so you know Smaller Companies like that benefit in todays environment. And your second choice is disney, and third, as i mentioned, berkshire hath way, you like disney for the fact theres feets in lots of ponds. Yeah. Disney does great. I mean, in the sense that, you know, look they are everywhere. They are international. They have some exposure but they ran the largest Cable Television show ever in terms of viewership monday night. Yep. They have constantly come out with new product. Berkshire, on the other hand were in omaha, theyre in omaha, how do you vote against a guy like warren buffet and what hes done . One of the things is go with what you know. The hometown vote there. Scott, back to you. Sure. Explain why you favor tips here on the surface, you think, well, why do you want tips in a time people worry about deflation rather than inflation . Sure. By the way, thats why we favor them because you know we were raised never to fight the fed or fight global Central Banks who are trying to produce inflation, they are trying to raise inflation expectations. They are talking about it. All their actions are pointed towards that. Deflation is the boogyman these days, and quite frankly, the tips market is priced with no inflation. Thats generally the time we want to buy them. We think that we are on the Central Banks side. We believe we dont want to fight the fed, and so we would rather expose assets to tips which, by the way, i think might do better than the tenyear hitting an alltime low yield as we sit here today. All right. If you look at the prospect of upside tips, its a better way to go. Made the case, scott, appreciate it, tom, you as well. Dom, from tom to dom for a market flash. Remember the story with kb homes, this is lenar, First Quarter profit in three years and forecasted a drop in the 2015 forecast. The shares as a result down 6 sending other Home Builders down as well. Kb homes, you see there horton and kb down. Back to you. Another story coming into focus this hour. U. S. Taking first steps to ease the embargo against cuba and new rules again tomorrow. Michelle has details on that. Michelle . Just released new rules this morning ill answer the two questions most after. Can i buy cigars . Can i travel to cuba . If youre in cuba, you can bring back 100 worth of cuban cigars that does not get you much, they are 25 each but you can bring them back you can only bring them back directly from cue da. If you travel to london, common for the audience and buy them there, that is illegal. No cuban cigars from third countries. Now, travel is complicated. Permitted forms of travel will now become much easier. Theres actually a lot of permitted forms of travel right now. You can go if youre going for humanitarian reasons, family there, religious group, doing some training for an entrepreneurs, thats all permitted. Right now, it requires a lot of paperwork. Most of the paperwork goes away. You can just get on a plane. However, you cannot get on a plane and go sit on the beach for three days. That will be illegal. Tourism is still strictly prohibited. If you do travel there, no spending limits on your travel expenses anymore. There was a per diem, couldnt spend more than 170 a day on hotel and food. That really controlled the price of hotels in cuba all controlled by the cuban government dont forget. Thats gone away. Prices are going to be able to rise bringing more money to the cubans and restaurants there, many of which are allowed by the cuban government for individuals to run to help out private entrepreneurs there. No license requirement for airlines. This reduces the amount of paperwork an airline would have to do if it wants to do direct flights to miami to havana, going on every day, by the way, but remains to be seen how soon that picks up. Easier trade terms. So, the way commodities and exports in general work in the world, youll see something overseas, put it in a boat, and the captain of the boat cannot unload it until he or she knows you have been paid. However, under george w. Bush what he said if you sell to cuba you know, med sipicines or agriculture products you have to be paid cash in advance. You cannot leave port until the cuban government pays you. You had to go through a third country. Took two days to get payment. Now its changed. Put the stuff on the boat arrives in cuba cannot be delivered until you are paid. Its now cash before delivery and theres now going to be the allowance of Bank Accounts by companies having correspondent accounts in cuba meaning direct money transfers back and forth between the two countries commercially, which used to take two or three days between a third country. Back to you. Quickly on the travel thing. Im not a tourist, so i have to have a reason to be there . Exactly. But the paperwork is less . Almost none. Almost none. Its retroactively if they are suspicious why you went you have to prove why you went. I went to church a few times and had a religious purpose . Exactly. Thanks michelle. The oil boom and collapse of crude prices is a doubleedged sword for the top Oil Producing states. Well drill down in north dakota. The number two u. S. Oil producing state, and cnbcs 10 th best state for business. Of course, it gets much of the energy and money from energy. How is it fairing with the collapse of crude prices . The governor of north dakota joins us next. [ radio chatter ] [ male announcer ] andrew. Rita. Sandy. Meet chris jackie joe. Minor damage or major disaster, when you need us most, were there. State farm. Were a force of nature, too. Welcome back to power lunch, shares of johnson and johnson, the second worse performing today, moving lower after being down agreed from a sell rate to a sell rating from a neutral. They drove the companys growth and valuation subsiding based on diminishing pipeline flow. The shares down by 2 , sue, on todays trade. Back to you zplp. Thanks, dom. Adding to the banks misses falling short of the forecasts, sinking 4 on trading session respectively. Target calling it quits in canada. The decision costing the retail giant 5. 4 billion in losses impacting 17,000 workers. Blackberry shares ran up strongly late yesterday afternoon, and now they are plunging, 18 after denying reports of talks with samsung on a potential takeover. And they denied the buyout rumors. Up to you. Sue, oil topped 50 before sliding again, and the recent plunge had a big impact on our neighbor to the north in affecting housing, jobs and much much more. Brian sullivan is live for us now in toronto, canada with that story. Hi, brian. All right guys thank you very much. You know listen we think that oil is a big story in the yieds, well, it is, but look at this. It is a huge story here in canada. It is not a headline. It is the entire front page of the globe and mail today. This is a major story, guys and that is why we are here in toronto, canada because in signs coming up well have the macro impact. We were foesed in cal