Oil down 15 since the opec meeting. Our road map begins with oil hitting seven year lows. We have news on the m a front. The latest on deals that may or may not happen. And chipotle down another 5 premarket, dragging that stock down nearly 20 so far this year. The latest on the companys e. Coli outbreak. Futures moving lower following mondays stock market decline. November data showing chinese exports fell for a fifth consecutive month. Weve seen wti fall below 37 for the First Time Since early 09. Shares of Mining Companies taking a hit after Anglo American announced plans to cut jobs as part of restructuring. Rio tinto said it will cut cap x in 16. Its all over today. Rio is off 39, valet, 69 . When you slash 85,000 jobs out of 135,000, what does that say about the amount of equipment youll spend . What does it say about the ancillary companies related to mining . This is all related to china. 13 straight months of chinese imports slumping. You cant have a Strong Industrial economy with those numbers. You know, a year ago or so, if you said oil prices will come down as they have already had a year ago and stay down and commodity prices, you might have turned around and say that will be good for the u. S. Economy. I just wonder at this point, talking more here oil and gas than i am Anglo American and the Mining Companies, but the pain felt in certain areas of the economy and how thats rippling out is interesting. I spent some time trying to talk to people in the credit markets to get a sense of whats going on with these energy and Energy Related companies. They have been doing everything they can to hang in there, to hang in there for the day when the price stops going down or starts going back up. Looking at the capital structure. They can no longer issue equity. They have highyield debt outstanding. Some of them try doing Exchange Offers where they will give you higher make you higher in the capital structure but less in Interest Payments by giving you a lower principle amount. You wonder where we are in this, when we will start seeing the true restructurings or if we can muddle along. I hear people say that opec meeting was not a big deal. It was a big deal. It basically said there is no opec. Saudi arabia is determined to break companies. A lot of people around the oil patch for a long time were dead wrong this time. Oil is only 6 of the s p. But the s p is not riddled with all these Master Limited partnerships. It does not have all these whats known as the mid stream companies. There had been a gigantic infrastructure built up. Only 16 states had that much at stake in oil and gas. But the companies that were spending were spending at a rate that really did presume that oil and gas would not go to these levels. You dont need it all. I would love to hear Warren Buffett on this. Hes huge in pipelines. Pipelines dont have to be bad if theyre not attached to debt, and theres natural gas being used. By people felt we would hang in and they would sell oil at 50, 51 in the futures. The saudis wiped that out. Thats what happened on friday. They wiped out the ability to sell in the futures market. Of course everyone is now recalling goldmans bear case for 20 washout, wondering whether that call is worth paying more attention to. We have all these the journal a nice piece about why produce . You need to service this debt as the average yield on speculative grade is postcrisis high. I still dont buy the 20. I dont buy the 20 because the production cuts will be far greater now. People have to remember we just peaked three months ago. People felt one of the great things the bookcase was we will ratchet back fast. We didnt. Natural gas last month, biggest month we had for production. To carls point, in terms of the borrowing ability or the ability of these companies to continue to borrow, high yield, overall it cost the capital 8 . You hear high yield being a disaster, but 20 of it is mining and energy, their cost to capital is well higher than 8. 5 , everybody else is borrowing close to 7 , which is not bad. Defaults will be extremely low in that part of the market, much higher in energy and mining, jim. We talk about the banks. They have these revolvers essentially that provide liquidity or cut back on liquidity depending on the price of the actual whats in the ground. Every quarter theyre reassessing that. We wondered out loud when are the big restructurings coming, because they havent yet. Rbm which does the best work on this, i always reference them, they pointed out theres less than 5 of revolvers revoked. Would have thought rbm has been saying its not the production is going to continue , it wont be as great next year. They are drilling in the eagle ford. Mr. Papa would tell you eagle ford is similar to saudi arabia. In the permian, higher. Bakken not so good. Colorado not that good. Those are the areas they were building pipe to areas that were presuming there would be a lot of drilling because were 80 to 100. Union pacific they tell you where theyre not they dont have a lot of oil being shipped. To your point what about the Pipeline Companies . Were still waiting on Kinder Morgan on what the decision will be from that companys board of directors in terms of whether it cuts its dividend or not. The alarian was down yesterday. Chesapeake energy down almost 20 at one point yesterday. A big Energy Conference with wells fargo right now. Yes there is. What do you tell people who own these mlps . Remember you what said at the beginning . People dont want equity. They cant use equity anymore. Its ratcheting down instead of up. They all go they have to be selfsustaining somehow from their own cash flow which means cutting the dividends. Then theres no reason to own the stocks. The only reason people own them is income. Havent they already adjusted to the expectation . The expectation is they would not suspend the dividend they would reduce it. Theres no evidence that the day or two after the stocks cut, they would rally. All these funds would keep spitting them out. Individuals own them. It was a great way this will turn out to be the reach each time theres always a reach. Theres always somebody reaching for yield. Theres always someone trying to get a little extra juice, borrowing money. And this is the group where honestly people right now are trying to figure out is this model completely out the window . Rates go up. I think back to when they were putting trailers in north dakota, trying to find places for guys to live. Everyone asked at the time, is this going to work . I remember speaking with farmers up. There the farmers were saying weve seen it all before which is why we are the largest navy bean state, the largest sunflower oil. Weve been fooled before. Theyll fool us again. Farmers. The agriculture department, met with the head of agriculture. He said it will all go away. I think rents have fallen for those man camps quite a bit. The man camps. And in general. The building that took place in north dakota. But eagle ford i dont want to say anything positive about the group, but there will come a time when people recognize that the companies that have a good alignment between the general partner and the limited partners, the companies that have good cash flow look at end bridge. The other day, endbridge dramatically raised distribution. Why . Its a conservative. Its really run like a company. Are nand there are names peo want to hear from back to kmi, jim. Why havent they told us anything yet . Why are they waiting and everyone else is waiting to see what theyll do . Theyll the big shoe. I agree. I agree. We have to hear that last acquisition, i hear good and bad about it there was a way to raise capital. What do you think theyre trying to figure out . Is it possible theres Something Else . Another source of capital theyll tap . I dont know. Im speculating. Balanced against the negatives of the debt and that last piece of paper they did is rich kinder. Rich kinder is revered in the industry. People feel he must have something. He must have something up his sleeve. I know that seems difficult but thats what youre betting on. Something up his sleeve. Now there are people that you no faith, essentially. Rich kinder, you interview a lot of people. John malone. He might get angry that i put rich kinder in the same sentence. I dont mean to upset people. They are people revered in the industry. Last year at this time in november he issued a statement saying we will be able to raise distributions for years and years and years. Last year in november. Thats not happened. We have to hear from him before we pronounce him guilty. The stock has been pronounced guilty. When we come back, one takeover bid has been received, another rejected. Well have the latest on this mornings m a and what people are saying about the doj and the ftc. Well talk about chipotle and some reports coming out of bosto boston. More squawk on the street in just a moment. At ally bank no branches equals great rates. Its a fact. Kind of like mute buttons equal danger. That sound good . Not being on this phone call sounds good. Its not muted. Was that you jason . It was geoffrey it was jason. It couldve been brenda. Shares of chipotle getting hit this morning after Boston College said several students, including members of the Mens Basketball Team felt ill after dining at the chipotle in bostons Cleveland Circle. That restaurant has since been closed. The Massachusetts Department of health has been notified and is working to determine if theres a link to the Ongoing National outbreak of e. Coli. This has been a west coast story for the most part. I want to be careful on this one, theres been no confirmation its e. Coli. People got sick after going to one, i wont say its not chipotle, but i felt its important to point out that that entity has not found e. Coli. But theres some sort of illness at that one, the Cleveland Circle. The stock held up remarkably well yesterday. The company does have a buy back. I think that people are split down the middle about whether to continue to go there from the poll that i took. But obviously this one is the one thats going to get big headlines, you were going from 45 to 52 people suddenly to a basketball team. Is there an execution issue here . I know. I know. Thats the issue. Its been weeks now. The cdc is involved. We had these things before. We had one from taco bell in 2006. The cdc got in. It was the onions. They pulled the onions. Took a long time for the company to recover. The fact that the stock was barely down yesterday, even though the numbers were considered to be very, very terrible for samestore, shows you theres great belief theyll pull out of it. Danny meyers said, tjust ate there. Do you think they should have waited longer before they came out and said this is how we think it will shape up . I think they were looking at the order book. I thought they were surprised that they gave a forward forecast. They could have stuck with what they had. I dont know why they did that. The company is not some people feel the company has been forthcoming, giving the data others have said, wait a second what is that prediction based on . I dont know. I was going to say, ancillary effects in the inverse, to mcdonalds, sonic, shake shake . My travel owns it, the one thats been the winner is jack in the box. Which had an incident itself some time ago. Yes. Really bad. Yes. They have qdoba. Mcdonalds has been going up. But its a strong belief in what easterbrook is doing, and that the numbers will continue to get bettermen better. Gasoline goes down, people go out. Thats not a false fear false read. Clarence otis was on squawk saying the same thing. When he was running darden, he said that was the crucial thing, gasoline down. Well see. Good amount of m a news to get to. We will get to all of it, including Norfolk Southern today, which will be the subject of a lot of talk from Canadian Pacific beginning their Conference Call now. I wanted to get to yesterdays story. The washington journal reporting late in the day. It moved both stocks. Im talking about what was not a lot of detail story saying rubbermaid and darden are in merger negotiations or negotiations about a combination. Thats about all we know from the journal. I have nothing to add at this point. The two sides not willing to give me much of anything there. People, that is analysts weighing in this morning at wells fargo. They say they estimate a new acquisition of darden could be 8 in year two. If you consider a 25 purchase premium to mondays close, 4 maximum leverage ratio. Others say maybe it would be a merger of equals. They are of similar sizes. Interestingly, jarden has the lower multiple. Newell rubbermaid is 18 . The last acquisition confused people. By jarden. A 1. 5 billion deal. When i spoke to martin franklin, cofounder of cochairman. Mr. Lily runs the company. Martin has other things going on. One is platform, one is nomad. He has a lot on his plate. Built this company over the last 15 years through a series of acquisition after acquisition. Mr. Theres some products were talking about. He has bought back stock. You have to take a longerterm view of what martin has done which is very, very strong. He has revitalized the brands hes bought. Has a lot of space. He once took a tape measure to different stores. Mr. Polk from unilever who runs newell, was on mad money recently. He has revitalized that whole place. Not on 10,000 mergers and acquisitions this year. 10,000 . 10,000. And the ftc, whether its ge, electrolux, regulators have finally said thats enough. You cant just too many. I saw the ftc you know, there is such a thing as do they not factor in retailers have to get together to stay in business . Many people were surprised initially, as is so often the case, many people thought otc staples not a problem. They will go to court. Could be an interesting case. They believe they have a strong case. They believe they have a strong case if it doesnt happen, the two entities could really struggle. This is one where a lot of retailers, i think, are thinking how do we get together and defeat amazon . The fact is that amazon doesnt seem to factor into the decisionmaking of the ftc as much as i thought it would. When we come back, cramers mad dash, count down to the opening bell. Look at the premarket on this tuesday. Expect weakness on the back of oil. Below 37 today for the First Time Since 09. Back in a moment. This is the one place were not afraid to fail. Some of these experiments may not work. But a few might shape the future. Like turning algae into biofuel. New technology for capturing co2 emissions. And cars twice as efficient as the average car today. Ideas exxonmobil scientists are working on to make energy go further. No matter how many tries it takes. Energy lives here. It is that time for a mad dash on a tuesday. 6 1 2 minutes before the opening bell. We will talk a little outerwall. They came out last night, stre supreme disappointment. This is red box, its amazing it held up there given the fact of netflix and the fact of how easy it is with amazon. When you go to your cable provider, they have a lot of movies. Whats happened is they blamed the decline, not only a secular decline, which is what i think is at stake, but on theatrical releases, saying it was the worst in four years, thats why red box did poorly. I want people to be careful here. That may be true about the theatrical release, what matters is red box has the most powerful competition on earth. The companies that we netflix, someone floats, maybe content is costing too much. That can go down. These are hard stocks to value. I was reading on twitter, buy metrics, how you can value netflix . I come back and say this is how they value it. I dont value it. I cant. But the emorpthey say its bad. Amazon introducing new things. Theyre all creating their own systems to give you variety that only comes over broadband so you dont need to take the video offering. And i think theres no room outerwall. People used to use i used to send discs back and forth on netflix. My kids said, dad, let me show you how to download. I got that circle, the buffer. They said do you have wifi . We switched to wifi. I have never gone back. Never looked back. Some of the old movies, you still need to get them by mail. Thats true. The opening bell a few minutes away. Keeping a close eye not just on stocks but bonds and oil. Were back after this. Here at Td Ameritrade, theyre always working. Yup, were constantly making thinkorswim better. Like a custom screener on your desktop, that updates to all your devices. And you can share it with one click. Wow. How do you find the time to do all this . Easy. We combined every birthday and holiday into one celebration. different holidays being shouted back to work, guys i love this times of year. For all the confidence you need. Td ameritrade. You got this. With tmobile and the incredible iphone 6s you can reach more people in more places than before. Whether youre at home in the basement on the open road or pulling the late shift at work. Youre more connected now because tmobile doubled its lte coverage in the past year. And our extended range lte goes two times farther than before and is four times better in buildings. Get iphone 6s for zero upfront and just five bucks a month. Youre watching squawk on the street live from the Financial Capital of the world. The opening bell in about a minute. Youll be hearing the phrase sevenyear low, sixyear low quite a bit today especially as it relates to oil on the back of chinese trade data which came in weak. Imports down, estimates were lower. People are saying, wouldnt it be argued that the chinese story is at least not conclusive yet . I would have thought that. The baltic freight has been a great measure of things. But the Anglo American reduction took peoples breaths away. Weve not seen the upside from oil. Southwest air, put out very good numbers this morning. Down 3 on good numbers. Toll brothers, i like their numbers. It doesnt matter. Toll brothers said good things. It doesnt matter. Toll has new orders up 12. Average selling price to 790, down 4 . I think theres overreactions. But when youre in a down mode like this, you say theres overre