Decade. Shares of the gap falling hard in premarket adding to the companys double digit stock slump. Shares of valeant and malinckrodt are lower. Still down in the premarket. Well have the latest on that scrutiny of and by citron. And in a few minutes, Mary Jo White will join us from d. C. Whats at the top of the regulators to do list . Stocks are set to open lower after rate hike concerns helped to extend the s ps losing streak to four and sent the dow back into negative territory for the year. Transports remain 12 below an all time high. Utilities down 15. A lot of signs that maybe we lost the momentum we built in october. I think we did. Norfolk southern up big yesterday on chatter of the possible bid, didnt seem to matter, the transports. No. That bid itself may be highly unlikely given the regulatory impedime impediments. People go, of course, theyll let that go. We need railroad in this country. Both class ones under the Surface Transportation Board, unlikely. Well see. I said something last night on mad money, i got a lot of jimcramer on twitter not understanding. Im not saying we need a rate hike. Theres much weakness. Im saying well get a rate hike. Well get one because they feel the window is open. China good, europe coming back, employment good. The data i deal with from the micro level from companies, terrible. That doesnt matter. Thats not what theyre look at. Looking at employment. I think people have to recognize the number stocks leading us verse whats happening in the market is ridiculous. When you look at the retail numbers youll get this week, youll say i cannot believe theyll raise rates. Gap is irrelevant. I dont mean to say mr. Peck, people who work at gap, you dont need gap. One thing you dont need is gap. You dont need banana republic. This is just what im saying. The economy, the real economy is doing not well. The job numbers support the fed hike. Yeah. People have to realize that markets go down on a fed hike. You referenced the number of stocks leading us higher. Usa today, wheres the br breadth . The top ten s p names are responsible for 100 of the year to date gains in the s p. I dont like that. I think we have a lot of headwin headwin headwinds. That employment number i want people to get a job. I dont favor higher unemployment. The employment number was not in synch with the earnings numbers. Earnings numbers coming down, employment numbers coming up. Thats sign of angst in the real economy at the manufacturing level, at the you can get jobs, but that doesnt mean youll get earnings per share. People have to recognize this rotation into the banks is not over. Yesterday the banks fared well. But theres 18 of the s p that does well, carl. 18 . A lot doesnt do well. Yeah. People still talking about if the dollar spikes higher oh. Maybe its only one hike. In which case the bullish thesis you built on banks is not quite as strong. Its not going to be one hike. You think the people who call for rate hikes on our air are going to say, im so glad we got a rate hike . Theyll talk about the next three rate hikes. Thats what they do. They dont care about they dont care about whether stocks go higher and lower. Im stuck with this stock job. You know what . Im done. Im talking about im going to start a 10 billion buyback of madigliani. What else do we get with that . A couple of picassos. Literally, when i showed the madigliani, i said theres something to go. Im buying valeant and buying ro rothco. Price attornto earnings multipl exploding. Instead im buying valeant. Rembrandt is going down. Theyre giving away rembrandts. Funny you mention valeant. The company has been conducting a Conference Call that began at 8 00 a. M. Still going on is the q a from the call. A few key things here. Broadly speaking, of course, we talked about valeant for years now. Much of it while that stock was moving up, as i talked about the Business Model. The fact they grew through acquisition. Rollup, using a low tax rate. Also approach to r d, different from the rest of pharma, to the extent they did not spend much money on r d. They did raise prices from the drugs they acquired, they also seemed to potentially generate organic growth. They were thought to have run it in some ways better than others. There was always a question about their Business Model along the way. Conversations jim and i have had for years. Much of that has blown up over the last two months. Last week or the week prior we were dealing with this Research Firm citron that questioned valeant and how they delivered drugs. In the call they said specialty drugs helped them deal with their original goal to devise Innovative Solutions for a problem they heard about from dermatologists. They worked with fiphillfil phi. Mike pearson said we have a large company, we feel good about our controls, but philidor is a large company, the allegations of wrongdoing are not proven, are still allegations, but for a company of this size, its impossible to have full knowledge of everything. The stock was up a couple. Down only a little bit now. People are saying wait a second, yet the dermatology business may not be that good, but people will try to rally around this. Theres a piece from Andrew Sorkin about bill ackman. In it bill ackman said the stock, like he was in control of herbalife and how that went down, this one hes telling you it wont go down. Like the chinese government. Got that for you. Chinese government, drawing a line in the sand. Ackman drawing a line in the sand. Ackman is the shareholder of valeant began when he helped valeant acquire allergen. They failed, but he succeeded. Took all shares in valeant, ended up being a large shareholder there, bought more in the decline and talks about he believes its going to go up for some time while its still going down. The questions i have relate to the board of directors and mr. Ackman himself. I wonder how long mr. Pearson can hold on to his job. Wow. Wow. Dont you have to ask the question . You think they have, like, a directors i wonder whether mr. Ackman at some point becomes this is just me curious about it. Does he become more opposed . Hes been issuing statements hes been supportive. Behind them 1000 percent. Then they have the two value act guys in there, mason and the other guy. Citron, scott wapner has citron. Andrew les will be on citron at noon. You want to go to the piece of tape . Yeah. The ceo of malinckrodt the new strategy is you short tweet. So its working didnt hillary do that . Tweet sends the stock down almost 25 after they say malinckrodt is potentially worse than valeant, even though in the original report valeant was another enron. We had the co on squawk box this morning on malinckrodt speaking specifically about some of the allegations. Heres what he had to say about the relationship with specialty pharma. We do use specialty pharmacies. We dont own them. They are a third party participant. These are typically owned by large companies, publicly traded companies. Their economics is separate from anything we do. They do not own or control in any way the specialty pharmacies. That may be a key distinction, jim, in terms of malinckrodt. How about sales which are not that good . Sales are not that good. But the multiple on the stock is low at this point. Talking about 7 1 2 times a lot of peoples 2016 numbers, seven times the 2017 numbers. Malinckrodt has a billion dollar drug. There has been controversy about it when it was owned by questor. That was bought by malinckrodt. Right. I dont know. I think these are all were in a market if you get the wrong tweet, youre crushed. There was a bat piece about flowtech. That one going down. The negatives will out. Maybe we should cut away. Gloets lets go to white. Mary jo white is with Mary Thompson. Thank you very much. We are here with Mary Jo White, chairman of the s. E. C. Thank you very much for joining us. Appreciate it. Delighted to be here. We are hear at the sifi conference, a lot of focus on the fiduciary standard. The department of labor introducing it earlier this month, the s. E. C. Despite years of the making has yet to produce its own. Why the delay . The s. E. C. Has been looking at this for quite some time. Certainly before i got here as chairman, we put out a request for additional information. So as i announced for myself, for my long study that we should move forward with the information for the shared rulemaking. The staff is working hard preparing those recommendations for the commissions consideration. One has to recognize that this is a complex not quick rule making. Its important to get it right. And to calibrate it so that you have the intended positive objective achieved but without impacts to the negative. Nevertheless, i was speaking with someone who said if the d. O. L. s rule goes through this will net that firm 150 million of fees on the backs of small investors. Part of your what your job is is to protect small investors. When you hear this, why hasnt the s. E. C. Moved . Again, you have to recognize, not only are we separate agencies from the d. O. L. And s. E. C. , we have separate statutory mandates and responsibilities. The arisa space is important for the department of labor. They are taking comment on their proposal. Initially in 2010. In terms of the timing. Its very important to get it right. Its very important. We have provided the s. E. C. Staff has provided Technical Assistance to the department of labor. Monitor closely what they do. Take that into account as we do when the fdic may move into the derivative space. Can you get any kind of timeframe . Come on. People have been talking about this for a couple of years. Not that long, at least from my perspective. Its something were engaged in. The staff is working hard on preparing that recommendation for discussion with the commissioners. But i dont want there to be misunderstanding. Its complicated. Its not quick. We are full out engaged in the effort. I have a question for you about short sellers. A number of them use social media go out and disparage the company they are short. Do you think thats an appropriate venue for them to make their views known . In terms of shortselling, you want to focus on not shortselling itself, thats part of the marketplace and can be done legitimately. But putting out false information, taking advantage of that is by whatever medium, can be manipulation. We bring cases, enforcement cases in on that all the time. Irrespective of medium, you cant make false statements to manipulate the market whether shortselling or doing anything else. It does give you another area you have to you have to police it. You have to police it. I want to ask you about a decision earlier this year to dismiss an Insider Trading charge against michael steinberg. This was on the heels of a decision by the court that basically changes what constitutes Insider Trading. Understanding thats a criminal case does it change at all the way you will be prosecuting civil cases . The newman decision, which is what youre talking about, is a significant case. No question about that. The laws, criminal and civil are parallel. It has some impact. Assuming thats the law of the land. In our area, in the civil space there are differences. Weve been quite aggressively trying to bring Insider Trading cases in the Second Circuit and around the country. One must take cognizance of that case in our enforcement of that as well. With the dismissal of the charges on mr. Steinberg, does it have bearing on your civil case with steven cohen and his failure to supervise . Thats something i cant comment on. The commission sits in judgment on that ultimately, whatever the recommendation is on that. I cant comment on that. Okay. Lets go to Market Structure. A number of people and one of the discussions that they were having when you were hear on the panel earlier is what is the s. E. C. Or what can we expect from the s. E. C. In the lets say next six months to a year as far as Market Structure . Theres lets start with the equity markets, its still too fragmented. What are you doing to make sure theres cohesion there so we dont see disruptions on one fl platform disrupting another. We are doing several things on equity Market Structure. I would add, if you look at the New York Stock Exchange outage, trading went on because you had multiple venues to deal with it. The point is all issues are on the table. Our Market StructureAdvisory Committee is engaged broadly with the staff. The ultimate decision is up to the commission. Looking soup to nuts at all the issues with respect to equity Market Structure. Its the best, most resilient market in the world t doesnt mean it cant be made better. Were also executing on those areas that i outlined last year. We moved forward on one proposal. Another i expect to see quick action on. Greater transparency for a. T. S. Youre never at an end at optimizing equity Market Structure or fixed income Market Structure for that matter. That would be the wrong mindset to have. Were really engaged broadly and specifically. All right. Mary jo white, thank you very much for stopping by and speaking with us today. Thank you. Carl, weve been speaking with Mary Jo White, chair of the s. E. C. Back to you. A lot more from mary this morning, Mary Thompson in d. C. More to get to today including this call on apple and what tim cook is saying about the future of the pc. Well see if s p can see five straight down days, something not done since september. Squawk on the street back in a minute. Why pause a spontaneous moment to take a pill . Or stop to find a bathroom . Cialis for daily use, is approved to treat both erectile dysfunction and the urinary symptoms of bph, like needing to go frequently, day or night. Tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. Do not take cialis if you take nitrates for chest pain, as it may cause an unsafe drop in blood pressure. Do not drink alcohol in excess. Side effects may include headache, upset stomach, delayed backache or muscle ache. To avoid longterm injury, get medical help right away for an erection lasting more than four hours. If you have any sudden decrease or loss in hearing or vision, or any symptoms of an allergic reaction, stop taking cialis and get medical help right away. Ask your doctor about cialis for daily use and a free 30tablet trial. Getting word from Chipotle Mexican Grill this morning that they will reopen the 43 restaurants in the seattle and portland area that they voluntarily closed. They will open in the coming days with a fresh supply of new ingredients. Health officials have concluded no ongoing risk of e. Coli. They tested food and services, 900 results came back with no test of e. Coli. There was a secondary thought that goes out there with this is the problem with organic, but quick serve, doesnt matter. Theyre all under fire from labor. Chipotle pays more than everybody. It doesnt seem to matter. Be aware in terms of the weakness weve seen in the downturn, these stocks have come into play. I happen to like chipotle very much. I think its important those came back online. Those stocks are in the rolling bear market i see. You mentioned they call them fight for 15 rallies. A lot of them today. Coinciding with mcdonalds investor day, also today. Tom well hear directly from steve easterbrook. Huge. Huge. Of the restaurants this is the only one working. Its because of this man who has taken out the menu the items too hard to make. Trimming the menu, won over the franchisees. Has 98 of them back. Hes real. What . I dont doubt hes real. You tell me hes real, i believe it. Hes very real. Im looking at you, he gives me that quizzical face. Like when i tell him i go shopping, i want him to come with me to costco. I look forward to that trip. I look forward to the costco trip. Will be a trip. Youll get one of those giant teddy bears. This guy is for real. Hes come in with a head of steam. Hes come in technologically oriented, but most importantly the throughput, its easier to go there and they dont make as many mistakes in your orders. Because youre no longer ordering the wine thats more like the uk. Yeah. He got rid of the difficult things to make, including the quinoa smoothie. Those are tough. Well get the mad dash and count down to the opening bell in a moment. Working 24 7 on mobile trader, rated 1 trading app in the app store. It lets you trade stocks, options, futures. Even advanced orders. And it offers more charts than a lot of the other competitors do in desktop. You work so late. I guess you dont see your family very much . I see them all the time. Did you finish your derivative pricing model, honey . For all the confidence you need. Td ameritrade. You got this. Do solemnly swearame , that i will support and defend the constitution of the United States against all enemies foreign and domestic. And the uniform code of military justice. So help me god. When we come back, well get to some of the names weve not gotten to, including gap, results from the Home Builders and why Credit Suisse cutting earnings out of apple by 6 . Funny, we talk a lot about bill ackman. There he is on the podium celebrating the fifth anniversary of Howard Hughes, of which he is a shareholder. Hhc the symbol there. Cant miss that gray hair anywhere. Lets get to the mad dash now for a tuesday. I had the ceo of a Company Called cyberarc, it counters cybersecurity. Did fantastically well. Different from fireeye. The business is strong. Apropos of this difficult market, bank of america and Merrill Lynch downgrade saying its about as good as it can good. This resonates with people because all the stocks with high multiple are getting crushed here. Be aware when you see cyberark going down, theres nothing wrong with cyberark, its the idea they dont want to pay a huge multiple on earnings for a profitable cybersecurity stock. Watch cybr, what this market is rebilling against is stocks like this. All r