Activist attack on wall street. This time, United Airlines. Two hedge funds with stakes in united announcing they think the board stinks and they want its own birthdays. What is interesting im looking a the release from par capital and all item meter capital. They own united shares. And they say say we are not shortterm traders nor are we activists. Yeah, right. They are active right now on getting six people onto the board. Including Continental Capital gordon buffoon. There are not people who will argue that united lagged its competitors. Its performance over the last five years, it has been underperforming relative to its competitors. By the way what you are looking at right there those are members of a Teamsters Union protesting out the jp Morgan TransportationConference Today where the cfo for United Airlines was giving a presentation to analysts. Here is lebeau talking about the Management Team performing woef woefully. If in a horse race and you are in fourth place you are not. Approximating. I believe the shareholders are not happy with having no airlines expertise at the helm. The man at the helm of United Airlines is oscar munoz. He has had a rocky six months to say the least. For the last three months essentially he hasnt been in charge of day to day operations becaused a heart transplant. He released a statement saying they are nominating six director candidates which we believe is designed to put their nominees in control of the board and our companys future. And again, he returns to day to day activities at United Airlines next monday. Take a look at shares of united versus southwest and delta over the last five years this. Says it all. Now, some people will look at this and say look the shars have more than doubled in the last five years. Compare with it delta. Delta is up mother than 300 . Almost any metric you look at over the last five years, they have not been doing well. The i amming smells suspicious because it was just yesterday the company decided they were going to put on their own birthdays. Increase the birthdays. Right, which to me looks like a board by them to stem off the activists. Absolutely. And get out in front of them. Well, they have been talking. Its not as though far and al tim meter havent been in discussion with the birthdays. It hit the point clearly the board decided to increase the size of the board to 15 members. Clearly that makes it more difficult for them to take over the board. We have a guest who writes extensively about these issues. What do you make of all this. And particularly gordon buffoon who has been in the Airline Industry for so many years and the platement. There are interesting personalities involved here. When you look at the slate phil said yesterday uniteds board added three new directors. Jim white hurst among them. He was an executive at delta almost a decade ago. And there was a period of time before deltas current and since retired ceo was hired to be ceo, goredon buffoon was advising deltas board and advised against making Jim White Hurst ceo. He told me that in an interview a few years ago. Interesting dynamics going back a long way. Buffoon, his protege, jeff smizic replaced by munoz. All kinds of dynamics. Almost as phil mentioned, almost reminds whenr you of when franklin del for roosevelt didnt like what was happening on the Supreme Court and tried too butt had nis own delegates. 1930s reference is a good reference. What can they do. . What actually can the board fix . Thats the big question, brian. We ran a cover story when they appointed munoz. We called it the jockey or the horse. Question mark. Thats the reference to if a horse isnt running correctly do you have a slow horse or do you have buffoon a fat jockey on the horse slowing it down . Because united has been its true what the hedge funds are saying, an underperformer. But that goes back 35 years. American and delta both at various times have led the industry in the same period financially. United never has been among the airlines that survived deregulation. Is it this Management Teams fault or something structural at united that makes it harder to run. Thats the question. Whats answer . It is interesting. If you compare to it delta for example, united is a much more unionized airline. American is heavily unionized, too. Things like that. You mentioned newark. Newark is a good hub. United has a presence in a lot of good markets. What it doesnt have is hub cities that it dominates in the way delta dominates atlanta, where american dominates philadelphia and atlanta. It helps to run up the score. One quick thing to keep in mind this. Board battle is intriguing in part because munoz was on the continental board with buffoon, there is a lot of ris. It seems like there is a lot of old scores here, old animosity. Your audience, if you are not an investor, you are saying can united get its act together. Thats what oscar munoz is hoping to do. He is better with Labor Relations than jeff smizic. Yes, the teamsters were protesting today. Oscar munoz, will he have a chance to implement his plan . Or does this distract him from that . At the end of the day thats what people who fly united are most interested in. Just quickly, this is the only industry unless you can think of another one where you can be lousy and do fine. Because 40 airports have a monopoly on out of the top 100. If you live in new jersey, you are pretty much stuck with united. Brian if you live in miami you are stuck with american. This is the salad days toer this stli. Its not going last for long. Im not talking about the profitable. I am talking about the operations. When the profitability goes away thats when you find out who has the Management Team that works. Phil, thank you for joining us. Appreciate it. Thank you. Would any of these changes move the kneeled on the stock. Jim corridor is an Airline Analyst at s p Global Market intelligence. He as a buy riting on the stock. Positive overall on the sector. United is his least favorite of the airlines. Jim, do you get optimistic thinking about the board nominations and the boblt that the Board Changes . I am certainly more optimistic today. Whether or not the slate gets elected or not, what is clear there is more pressure on united to improve and improve faster. It has long lags in almost every metric that we follow. They have been lethargic in responding to criticisms on this right now they are going to have to make moves what is the reason this airline has lagged its piers . Is there something you or the board can put its finger on and say we are going to go after that. Their hundreds, they dont have a market share lock the way that airline and delta do on their hubs. They have a Higher International share than delta and american. What is driving metrics right now is american travel. Also they have mismanaged operations. They have a unit revenue disadvantage to peers. They have miss matched customer expecting as over the years. Thats one thing that. Last question, jim, at this point in time, as phil mentioned, these should be the salad days for the Airline Industry, the best time ever, and the stocks arent reflecting that . Is there a capacity problem . American Airlines Capacity up 8 . Load factor, down. Jet blue, soft First Quarter guidance, it blamed increase in capacity. Whats going on. The industry is growing fraser and thats rightfully so. There has been a revenue problem in the industry for years. Airlines are not growing for them to get the next step up in profitability they need to find a way to revenues. Investorsr focused more on the unit price degradation than they are on overall profitability. I think thats a mistake for the long term. Jim, thank you for your inviting. A news alert in the bond market right now. I know youve been waiting on it. Three year bonds are up for auction. Lets get the grade from the professor, rick, how would you grade it . Sully, for demand, straight up one eastern, d plus. D as in dog plus. All right, 24 billion three year notes up for auction, dutch auction. Yielded auction, 1. 039, just shy of 1. 04 . The bid side on the one issue mark was 1 three and a half, roughly half a basis point tail. Deteriorates from there. 2. 71, 2. 71 chasing every dollars worth of securities available known as about it to the cover. The last one was 2. 74. That was the weakest going back to july of 09d when it was 2. 62. So this continues that streak, the weakest since july of 09. 46. 2 on indirects. A little light but close to the average. 9. 1 on directs. Thats the weakest since september of 2015. No matter how you sloois it, the first leg of 56 billion in supply is a d plus. We look forward tomorrow of course to tenyear notes. Brian, melissa lee, and the gang, back to you. Im part of the gang. The gang of four. Rick santelli thank you very much. Lets get back to whats happening in the Broader Market and do a tale of the take. Take look here. This is the one year chart of the s p 500. All time high back on may 20th of last year. It hovered around there for a couple of months. Then you see what happened in august. Thereof the big drop. Coming back, dipping again in october. But then finishing the year hovering close to the alltime highs. Then of course what happened . The calendar changed. You got 2016 im getting out of the light. Oh, that makes them unhappy over here. Make you even more unhappy. Went all the way down there to february 11th, 52week low. Which brings us folks back to today. Since our alltime high, the dow is down the excuse me, the s p is down 7 . So the question now is whats next for your money . Joining us in a power lunch exclusive, john haler, ceo of one of the worlds asset managers, nearly 1 trillion under empty. John, thank you. We appreciate you are being here. We had to cancel last week because of breaking news. Were glad you came back. What happened on february 11th that turned things around . What was the switcher the dog whistle or the phase of the moon that made things change the narrative . Ive got to say if you dont mind me starting, there is a couple of thing we can talk about in the world, politics, religion, and airlines. And everybody has an opinion. It was quite fun listening on that end of it. Hey, basically, i think whats beginning to occur again is locks like the u. S. Is carrying a little bit of the markets right now and carrying the global economy. How long that lasts is going to be anybodys guess. I think one of the challenges you are going to face is the u. S. Has gone a phenomenal job of almost, you know, having an amazing consumer based economy that has been able to protect itself a little bit from the down turns around the world. How long that can last im not really sure. But i think there was an overselling in the marketplace. So i think well recapture what happened in january and february throughout the year. But how much more well get out of that, im not really sure. You know, a month ago everybody was fretd being china. They were fretting about the possibility of a u. S. Recession. They were fretting about oil in the 20s. Now oil back up. But now it seems to me and ultimately isnt it always the case that what really matters in the end is corporate profits . Yeah, and i think one of the thing, you know, look, pes are a little better value than they were even years ago. You have seen them come back. They are not dirt cheap but there is a little bit more value. When you look at Earnings Growth everybody was projecting out 8h eight. We think its run pg three or four percent range. Thats still a positive sign. How much this can move the markets is going to be the big guess. We are talking about china, u. S. , whats going on in europe, british the british exiting europe. All of these things can affect people and their portfolios. Thats why you have got to have a longer term outlook than worry being the volatility in the marketplace. I think thats going to be a big challenge. Your guess is that all of these things arent going to move the markets very much from where we are right now through the end of the year. You are predicting what . Yeah. I think what you are going so see is probably gathering of assets, getting some valuation out of the investments youve made. I dont see a lot of Great Movement across the board, but at the same time i think its a chance. If you thought something was cheap last year if you thought something was cheap in october, november, and you see its even cheaper now and you have got a long term outlook why wouldnt you be looking at reinvesting and buying that . Thats the key here. You are looking about 2100 s p at the end of the year. Thats about 1,000 points from where we are today. If i want to try to eke out more return than that would imply, what sectors would you directly to . Quickly. I guess when you look at this and people keep talking about how long can oil stay at 40 a barrel or beneath that . How much further will it go up . A lot of capacity out there. Until that supply goes down. I think you are in that kind of challenging environment on oil over the next 16, 17, 18 months before you start to see that supply run out. Is there an energy . Depends how you are looking at it. If you are looking at short term, we see s p up 2200 at the end of the year. 2250, if that ends up going there, we are going to have an all right year arc god strong year. But i think here you have really got to have people say why am i investing today . How does it match up with my portfolio . How does it make sense with what im doing long term . I think thats the chance. Volatility is going to be in the market. Here for a while. And i think thats the challenge. Let me be clear. My notes have your call on the s p at 2100 for the year. You just said 2200. Which is it . The texas its across the board. One of the challenges for our firm, we have different managers with different outlooks. There is no one standard Corporate Outlook at our company. We dont have a top down approach to what the s p is going to be. It varies from manager to manager. Across the board everybody has a little bit of a different opinion on where they think the s p. Im not ducking the answer. Just no top down approach. The difference between 2100 and 2200 is not the difference between 2100 and 3,000. Its kind of a meh year to not such a bad year. Jn, thank you. Always a pleasure. Hope to see you again soon. What if i told you there is an easy way to put an extra 400 a month in your pocket . Id like to do that. Find out how in two minutes when power lunch returns. Hey, jesse. Who are you . Im vern, the orange money retirement rabbit from voya. Orange money represents the money you put away for retirement. Over time, your money could multiply. Hello, all of you. Get organized at voya. Com. Welcome back to power lunch. Im melissa lee. Are you literally sitting on an extra 400 a month in savings . You just might be. Diana oleic is here to explain. A stunning be number offer booers havent refinanced their mortgages to todays low rates. Im not talking about cash out. Im saying lower your rate and save money. If you are up at 4. 5 you are too high. The 30 year fix dropped 30 basis points in the first two month of this year and is now well under 4 . By the end of february, 6. 7 million borrowers with higher rates could have saved an average of 3,000 per year arc collective 20 bmds in potential annual savings. And this is all according to an analysis by black knight financial services. These are borrowers with good credit and enough equity in the house. Now more than 3 million borrowers could save 200 a month or more. Nearly one million could save 400 a month or more. One and a half million are a pull percentage point above where they could be. Yes, there are fees but nothing compared to what you save over the life of the loan. People, dont overpay. All right thank you very much diana oleic. I dont know. Have you guys refinanced yet . A million times. Are you serious. A million times. How many times. One for each dollar value of his home. He just does it a buck at time. At least four times since i bought the house in 20064. Are you glad you did it . Its a pain in the disturby. I was going to say. And it has gotten harder. It is a pain in the neck. The closing has gotten much harder. What they require you to show, everything. The documentation. The documentation is much harder. I just changed about a year ago because i know america wants the know about this, to a 15year mortgage because the rates were so low. Sure. It raised my it raised my Monthly Payment about about 1,000 a month but you end up saving hundreds of thousands of dollars over the life of the loan in terms of interest. I was able to do this because my alimony ended so i had a little more cash. Yea i dont give a lot of advice but i will here. I think you need to refi, max out the entire thing, cash out, and buy a boat. Buy a boat. And a big screen tv. And anything else that deappreciate yates. A boat with a big screen tv. And cars. Explain. Because that worked out well previously. Unreal. Thats oblsly not advice. On a real note i wonder whats happening to the housing markets five or ten years from now. Serve refiing. You are going to be locked in a low loan. Lets say Mortgage Rates rationalize and go back to 5 5 used to be an amazing number. Lets say that go back to 5 or 6 . Is anybody going to move . The if they go up to that percentage, the economy is stronger. People dont buy homes based on the price, they bay it based on the Monthly Payment. I won der would melissa lee move or renovate my current residence because i dont want to deal with this extra rate. I wonder. Maybe not. Politicians on both sides of the Atlantic Land making noise that could affect your money. That story when power lunch returns. You both have a perfect driving record. Perfect. No tickets. No accidents. That is until one of you clips a food truck, ruining your perfect record. Yup. Now, you would think your Insurance Company would cut you some slack, right . No. Your insurance rates go through the roof. Your perfect record doesnt get you anything. Anything. Perfe