Indicating another tough day for the markets after the first backtoback losses in five weeks for the s p and a fourday losing streak for the nasdaq, but as well talk about with jim in a moment, could clearing the froth be just what the market needs . General motors set to continue lower after its worst oneday performance in over two years that was yesterday and after a report that the u. S. Attorneys office in new york has opened a criminal probe in to the handling or lack of handling of a recall. Continuing fallout from the target breach. New data finds that customer traffic fell to a threeyear low in january. And we talk to twitter cofounder biz stone about the outsized valuations of some of todays startups and whether were in the midst of another dotcom bubble. The s p logged its first backtoback losses in five weeks and the nasdaq posting its first fourday losing streak since august as shares of fuel cell, plug power and tesla took a hit. Cramer sounded off on all of this last night on mad money. Take a listen. Thats why im saying that the losses sustained in tesla, fannie mae, freddie mac while terrible for those that own them and i know it and i feel for you because i know you a lost a lot of money might be the best news. When fever behavior goes away and we return to making money the slow methodical way then the market is a safer, more rational place. All right, so the steam is coming out of the kettle, jim. I think theyre going to bounce today. I dont want to frankly, this was the most worrisome bit of froth. I know someone counted i used the word froth 12 times. Lets not have the froth cross over. This was really bad. Reckless, okay, when you see when you see Companies Like fuel plug, these are companies that have lost money nine years in a row and maybe they are finally near commercialization. I remember trading these stocks as a hedge fund manager, come on. When you see the hundreds of millions of shares. This is exactly this is the type of behavior that i dont want to see. If they cool, if they stay cool, then you could be okay. But this behavior is it reminiscent of the days i would sit there and talk about ktel shares going up because they suddenly had an internet . Ive been saying were okay as long as it doesnt go really nuts. Yesterday just went really nuts and i see ballard trading up. They are trying to recover. Come on. Do you think they are worth 50 cents . Are these casino stocks . No. But they were worth a dollar just a few weeks ago and thats the kind of parabolic move that marks the top and i dont want to see a top. I obviously would like to see regular stocks come back to the fore and do well, the selfhelp stocks do well, but this market has been dominated by plug and ballard and fuel cell and been dominated by fannie and tesla. Also coinciding with Corporate Bond defaults in china. Copper story is big. And soros said europe is in for a quarter century of stagnation. Is there something larger than froth coming off . I think our country is surprisingly strong. I had united reynolds on, the largest rental company of equipment and they are looking strong. But none of that matters because this when you go, like, look at a twitter, jim, how can you not love ballard, how can you not love plug . Because ive been looking at those stocks for a decade. All they know how to do is lose money. Maybe this is it. Maybe ktel really does have a breakout. Ktel went up for a long time before the Broader Market started to come down, it was march 10th, 2000, i think the nasdaq hit its high after many years. Are we too focused on some names that may be exciting but lets keep an eye as carl says on the broader picture . Everybody wants to blame china and that may not be the case but it seems the likeliest candidate for saying why we are going down. The new corp is a Huge Consumer of iron. They would love to see it lower, the Home Builders are users of copper. I keep hoping that people focus on our country again and the news in china is the slowdown. Dont want to lose sight i can overdo the fuel cell but im saying those are what people on an oil rig in the gulf and everyones, like, fuel cell. Like no, no, how about the company who was on and then, of course, the stock goes down big because they make an acquisition. They do a fairly large acquisition right after you speak to them. Talking about the energy partners. They said they were inquisitive, were inquisitive, thats really inquisitive. You are talking about a 2. 3 billion deal to buy a competitor, pay a nice price, 39. Theres crosscurrents. I just dont want the crosscurrents to turn out to be equal. I dont want the enthusiasm for these things, fannie and freddie, weve said the common stock may be worth nothing. Right. Bill ackman made a choice to invest in the common. You got to remember Perry Capital which i reported on which is suing the federal government over the third amendment socalled where they sweep all the profits which has hemed the budget deficit, reduce the budget deficit, they own the preferred. Bruce berkowitz, preferred. Ackman made a decision to get into the common. That was hurt yesterday on this new plan. The time story for ackman. One of the things we learn about bill hes more of a genius than we think. Hes a super genius. Tesla the electric company. Not more than he thinks but more than what you may think. I read the New York Times piece and this is basically here u. S. Attorney, here s. E. C. , silver platter and instead all i hear is no, herbalife is a corrupt company. The New York Times investigation was pulitzer. Thats the type of thing if im if im the u. S. Attorney, hell say, well, call him in. I dont like the way this reads. But instead all i heard about was, yeah, herbalife has it coming and the big boxes in the garage and china. Didnt get much from him on the china. A lot of people were waiting and the stocks started to trade up once they saw it wasnt much of anything on this new presentation. Is he the judge, is he the jury or the prosecutor or all three . Has he replaced the government . Has he replaced the senate . Senator markey, the lobbyist who used to work there convinced markey about the malfeasance. What can i tell you . God love him. All right, so fannie mae and freddie mac coming down and gm down. All these pretty well owned within hedge fund circles after what was the worst oneday performance in over two years after reports saying the u. S. Attorneys office in new york talking about the u. S. Attorney opened a criminal probably of gm and its handling of the ignition switch recall. Prosecutors are reportedly examining that gm is criminally liable for failing to properly disclose problems with the switches. Gm tells cnbc it does not comment on ongoing investigations. Stock got badly hit yesterday. This is a real test for the new ceo. Barra. What do you do with the stock . My charitable owns it, horrible day. Gm reserves 500 per vehicle for recall. 3 billion annually, the total reserves are 7. 3 billion, the government owned it during part of this denial. No, what happens is that the this stock is going to take a long time to recover i think. I think that this everything reads so badly that people are freaking out. But if you look at the actual amount, the actual amount really talking about 80 million. Okay. 80 million in the actual recall. What about lawsuits and what about toyotas costs on Something Like this will be a billion dollars. It could end up being a lot of money. Would i touch the stock . My Charitable Trust owns it, do we wish we didnt own it . You bet. But you arent going to sell it. No, this represents great value, and this will pass. You realize its gm, herbalife. I thought it was power and ballard. Thats my interpretation of the market. Thats my view i thought its interesting what a rough week its for companies that make things move. Tesla in new jersey and gm with this investigation and boeing with malaysia which is turning out to be an incredible story. But a good week for companies that make food that we want to eat. Mcdonalds, biggest move in two years yesterday. Unbelievable. On the idea that they might optimize, they could optimize. Optimize. Right. In the meantime theres some more fallout from targets data breach. In january the retailers customer traffic fell to a threeyear low. 33 of u. S. Households were shopping at target stores. Its according to a Consulting Firm called cantor retail. They said the sharpest decline came from genxers. They cite an analyst saying 5 to 10 of their base will never come back. Thats incredible. The stock was at 56 before they announced and they sounded pretty confident and they fired the chief the chief officer leaves. But this was these reports this morning were kind of devastating and this is just a traffic go away from traffic. I was in walmart in louisiana. Buy a pair of slacks, you know, im a slacks buyer. I do know that. It used to be jcp. Where is the pants aisle, its over this way, over this way. It was so hard to find any pants with a waist below 42 so i dont think that walmart you are bragging. What is that . A lot of hefty theyre not going to walmart. This is largely a result of the breach i would assume. Yes. Beneficiaries of Something Like this might be a fireeye. Yes. Take a look at verifone, they talk about it. Saying, hey, youve got to these things have breached the wall so to speak around the idea that you dont have to worry that much about your data. But do you really think that target will lose that many customers . I have no idea. Nearly half of american households were shopping at this place every month. That was staggering. That was when we first learned about the breach itself how many people had been compromised was amazing. I couldnt believe it. I dont have a target card. I was turned down for a kohls card because you get the quick discount, you know, if you buy right then but i am amazed by this because i thought this had already blown over. It hasnt. And thats a lot of customers looking for a place to buy discounted goods and yet costco didnt. Thats where i thought people would ship to. The president shopping at the gap in new york city. Raising numbers, gap. Yeah. Spent 150 bucks. Did you see that . Gross margins are big. If you go to Urban Outfitters, arr a a aeropostale. Have you ever shopped there . What will go in my tesla showroom at the short hills mall . What store will move into that, right . When we come back what a street, biz stone with the stock up double from its ipo what does biz think about the valuations of new tech companies. Also take one more look at futures nasdaq has not had five days down in a row all of last year. It might do it today. More squawk on the street live from post nine in a moment. Tdd 18886282419 searching for trade ideas that spark your curiosity tdd 18886282419 n take you in many directions. D 18886282419 you read this. Watch that. Tdd 18886282419 you look for whats next. Tdd 18886282419 at schwab, we can help turn inspiration into action tdd 18886282419 boost your trading iq with the help of tdd 18886282419 our live online workshops tdd 18886282419 like identifying market trends. Tdd 18886282419 now, earn 300 commissionfree online trades. Call 18886282419 or go to schwab. Com trading to learn how. Tdd 18886282419 sharpen your instincts with Market Insight from schwab tdd 18886282419 experts like Liz Ann Sonders and randy frederick. Tdd 18886282419 get support and talk through your ideas with our tdd 18886282419 trading specialists. Tdd 18886282419 all with no trade minimum. And only 8. 95 a trade. D 18886282419 open an account and earn 300 commissionfree online trades. Call 18886282419 to learn more. Tdd 18886282419 so you can take charge of your trading. Twitter and jelly cofounder biz stone speaking at south by southwest where he introduced twitter seven years ago. We sat down with stone and asked him what he thinks about some of todays valuations like whatsapp and whether were heading into another dotcom bubble. Take a listen. I think about whether or not something is bringing value to people. And if something has an incredibly high valuation but it doesnt seem to be bringing value, i think that is dangerous. If something has really high valuation but theres value there, i think thats okay. So, i think were living in a different time than the, you know, dotcom bubble of 2000 when you saw stratospheric valuations for things that didnt seem to be or didnt look like they were of any value. And you also have to remember, you know, aol bought time warner for, like, 140 billion or something. I mean, so even though were hearing big numbers now, theyre nowhere near as big as they were, you know, back then. In terms of twitter, theres just so much more runway for growth ahead that its just to me its exciting just to be able to watch. Interesting story with these guys. You know, back in 08 zuckerberg offered to buy twitter. The guys at twitter made up a number they thought was unrealistically high that he would never meet 500 million which zuckerberg actually said fine and then they changed their mind and decided no to sell at all. But that gives you a sense of how far weve traveled from 500 million to 16 billion with whatsapp and facebook. Twitter escapes people. You have to believe that twitter will be your own personal news service. You have to believe that twitter is going to attract a lot of people who dont tweet. If you believe that, maybe you can come up with a 20 20 valuation. And im not talking about 20 20 hindsight or foresight but its hard to value. People dont want to hear that. Its hard to value versus yelp, okay, and its the most expensive and thats why i picked it in terms of users. Its hard to value. When you say hard to value, it means, do you know what, its too dangerous. Hard to value to some people means elusive or interesting. Or it means a great deal of possibility beyond what we know of the service and what it will become given, though, that their problem seems to be user growth and the socalled scaffolding around it, meaning its a little more difficult not as intuitive to use as perhaps some people would like. My colleagues have figured it out but im still working on it. We ask him later on, well play some sound later about whether or not the product needs to change in a big way to make it more digestible for the masses. It is a mobile product. It is a social. It does have cloud. I mean, it has all the buzzwords. It certainly has the money to reinvent itself. Remember, we have seen these companies morph into something far more lucrative than we thought initially and it can happen here, but it has to happen. It cant stay up here unless there is something at the end of the rainbow. There has to be something. Otherwise it doesnt deserve where it is. Well get more from stone later on in the show. Up next cramers mad dash before the opening bell. Look at the premarket and well get the bell in a few minutes. I got something to say with fd onesecond trade execution, we route your order to up to 75 Market Centers to look for the best possible price, maybe even better than you expected. Its all part of our goal to execute your trade in one second. Im derrick chan of fidelity investments. Our onesecond trade execution is one more innovative reason serious investors are choosing fidelity. Call or click to open your fidelity account today. [ mala body at rest tends to stay at rest. While a body in motion tends to stay in motion. Staying active can actually ease arthritis symptoms. But if you have arthritis, staying active can be difficult. Prescription celebrex can help relieve arthritis pain so your body can stay in motion. Because just one 200mg celebrex a day can provide 24 hour relief for many with arthritis pain and inflammation. Plus, in clinical studies, celebrex is proven to improve daily physical function so moving is easier. Celebrex can be taken with or without food. And its not a narcotic. You and your doctor should balance the benefits with the risks. All prescription nsaids, like celebrex, ibuprofen, naproxen and meloxicam have the same cardiovascular warning. They all may increase the chance of heart attack or stroke, which can lead to death. This chance increases if you have Heart Disease or risk factors such as high Blood Pressure or when nsaids are taken for long periods. Nsaids, like celebrex, increase the chance of serious skin or allergic reactions, or stomach and intestine problems, such as bleeding and ulcers, which can occur without warning and may cause death. Patients also taking aspirin and the elderly are at increased risk for stomach bleeding and ulcers. Dont take celebrex if you have bleeding in the stomach or intestine, or had an asthma attack, hives, other allergies to aspirin, nsaids or sulfonamides. Get help right away if you have swelling of the face or throat, or trouble breathing. Tell your doctor your medical history. And find an Arthritis Treatment for you. Visit celebrex. Com and ask your doctor about celebrex. For a body in motion. 8 30 to the opening bell here on the hump day. Okay. David, your breathtaking interview with masa, this was really important for me who like sprint on a fundamental basis only if they can make an acquisition because they have such costs ahead including the need to finance. After i listened to your interview i felt more emboldened to think the leem of faith of sprint being able to buy tmobile could happen. It could. Certainly masa son while not speaking specifically to that deal more or less indicated his devisire and need for more scal if he wants to make the kind of investments that will result in a more level Playing Field between verizon and at t and what would be the third competitor that would be created. But the doj and the fcc may have something very different to say about that. They seem very happy with four players right now and his case that he will continue to make is i will bring levels of service to you and price competition that you have no idea about. Like the air in beijing he likes to make this reference for Chinese People who are there every day in beijing, you may not notice that youre breathing in this awful air but if you see it from afar and go there, same thing here. By the way, japans about the size of montana. So, you know, comparing and saying weve done so much better there than we can do here may not be a fair comparison. But at the same time its bold. Im not saying its brazen, but its bold. Listen, government, this will happen, so, like, get with the program. Thats almost how i feel when i listen to the interview, government listen up and they make an argument that the kind of speeds they can deliver is ten times what you get in your home