Were going to have much more of sara eisens exclusive interview in just a few moments. In the meantime, a lot to look at as stocks hit new highs for the year, about 2 from alltime highs. Bank earnings in focus. Europes mildly positive. Core cpi up 2. 2 year on year and jobless claims hit a new low going back to 1973. First up, wells fargo beating expectations with a firstquarter profit of 99 cents per share, revenues above consens consensus. They say while credit results remain solid, the oil and gas portfolio remains under significant stress due to low prices and excess leverage in the industry. And then b of a exceeded estimates with firstquarter results, put profits down 18 on a doubledigit decline in trading revenue. Not a repeat of the performance we got out of jpl. Going over these quarters all morning, and i have kind of a very simple takeaway, which is that, wow, if these companies were to have a bunch of rate hikes, you know, theyd make a fortune. And if they dont, they kind of do a little bit worse. And the stocks took a swoon when we found out there were only going to be two rate hikes, and these two numbers do not make me feel like, you know what my Charitable Trust banks are not the ones to own if theres a rate hike because they can loan progressively and they make a fortune. But jpmorgan set a high bar yesterday, because their whole release, their whole Conference Calls, their whole attitude was basically, look, we dont really care as much as we did when we thought we were set up for rates to go higher. And so, thats why i think jpmorgan was a big one, because they kind of distinguish themselves from just a rate hike bank, and that was impressive. Yeah. They also distinguished themselves because the expectations had gotten down to a point where they were able to beat them, even though it was not an impressive quarter from a year over year perspective. Everything was right. Most everything was in decline, not everything, jim, but it did set a tone. I just wonder whether now that weve heard from b of a and wells fargo this morning, that will continue, or did that rally already burn itself out yesterday . No, look, there is a deep cyclical component to bank of america. Its now tangible books now 16. I know without the regulators saying green light to buy as much stock back as you want, thats very hard gap to close. But i look at caterpillar, which is up 8 this week, even though peabody filed bankruptcy. And i say, people felt caterpillar was devalued. There could be someone who says bank of americas devalued, but in the end, youve got to have the people who want three rate hikes win in order to make that stock fly. I mean, bank of america is so set up for higher rates, its amazing. Therefore, its not set up for a raise. Meanwhile, the cfo, denof roe saying more tepid comments than dimon, slowly improving. As for trading, said march obviously felt better than january and february and that april feels a little bit more like march than the first two months. I thought that was great and you know, they do have a huge amount of revenues. Again, im making the case for not selling it. I cant make the case for pounding the table and buy. I felt like i could with jpmorgan because they had such great momentum, and they did make the march comment. But you go over i mean, we can talk endlessly about oil and gas, and oil and gas is not good, but a lot of that is starting to get baked in. But david, we were talking beforehand yeah. You dont really know how bad the exposure to oil is because you dont know the quality theres a lot of lines that still can be drawn down. Right. Bank of america has a lot of lines to be drawn down. You dont really know the quality of these guys. You know if Oil Goes Back to 26, you have to sell almost every bank. But if oil goes to 50, then the pressures off. Yeah, and do we get any real sense on the Conference Call or anything else . I mean, some of them have not yet taken place, but i think that, you know, the sense is that, geez, we hope well, hope should be part of the equation but look, were okay. If oil goes down big, were not, and if oil stabilizes, were okay. Again, this okay concept is part of the earnings conundrum i have right now. Csx was okay, and people bid that stock up 4 . Okay in some industries when youre down from 37 to 24, like csx, are pretty good. Bank of america i mean, its almost like they should put out a release that says we are ready for rate hikes. But the overall barometers for the u. S. Economy are not bad no, no 7 total average loan growth. Yes the revenues are there. Thats not bad. I mean, we know deposits think about the number, 1. 2 trillion worth of deposits. Can you imagine when rates go up, how much money at wells fargo. Look, i think Net Interest Margin was a little bit shy. You know, youre picking, nitpicking. Look, the theme of today is, is that we have better jobs and we have low inflation, and thats an environment where you do not want to sell bank of america and wells fargo. You dont better job growth and lower inflation . Thats when you buy these, but you need a catalyst, and i havent heard the catalyst. And i know stocks were up big yesterday. So, lets accept the fact they were up big yesterday and to have a secondday rally, you would have had to have seen tremendous earnings growth, and you cant. You cant get it if the question is on the overall markets whether this is a blowoff top or a sign of something new to come i find it hard to be a blowoff top when you have low inflation and better job growth. Thats kind of like, my whole life ive wanted that. Since 1979, when i bought my first stock, what you wanted was low whats the matter . Jim came out of the womb, said give me low inflation and good job growth take the top off no, but listen, pop when my firstborn was born, i bought alcoa and that was a big mistake. Never mind. Lets not read into that because thats the past. Thats years past. But i do think when i look at an environment where the fed cant raise and job growths okay, look, we had real earnings of plus 0. 2 in march. Its pretty good. And in that environment, i can find stocks to like. I guess thats what im saying. Look, as long as i dont buy value traps like a seagate, right . Those are problematic. I dont buy coal. I dont want to buy coal. I dont want to buy Oil Companies that need 80. Equal is the best place in this country to drill. Sorry to reassociate with that. Thats okay. And there are three counties where you can make money, the best prospect. When i look at the oil and gas loans and see that theyre criticized, im more worried than they are. Im more worried. And perhaps you should be. Quick aside for me, and this is sort of apropos of nothing. I mean, guys, please, what are these press releases that were now dealing with . This is decipherable. Please stop, bank of america. Jpmorgan started this trend. Here they are. I thought they where do they your eye doesnt know where to go, you have no idea. And look at ge, by the way. I just picked that one , too. I mean, come on, guys. Give me an oldfashioned press release like wells fargo, all right . I can read it i can actually read it. Stop with this newfangled press release that basically is designed to make you not want to read it. I dont like it. Look at unilever, since they have a model on every other pitch. Okay. By the way, you cant rely on these press releases for anything other than basics. Read the cues you want this, right . Yes. Yes. Thats nice. Swimsuit edition. Sure. I mean, this is a guy whose stock is going up. Jpmorgan will put her on the front of their press releases next. Anything to divert your eye from the actual news. Nonsense. Its got my eye. Coming up, sara eisens exclusive with treasury sec jack lew on the sweeping tax inversion tracrackdowns and earnings, delta and a lot more. Dont go away. Ng good. She needs more care though. She wants to stay in her house. I dont know even where to start with that. First, lets take a look at your Financial Plan and see what we can do. Ok, so weve got. Well listen. Well talk. Well plan. Baird. Steve, other than making im here atme move stuff,rade trader offices. What are you working on . Let me show you. Okay. Our thinkorswim Trading Platform aggregates all the options data you need in one place and lets you visualize that information for any options series. Okay, cool. Hang on a second. You can even see the anticipated range of a stock expecting earnings. Impressive. Whats up, tim. Td ameritrade. Our sara eisens in washington this morning for the Imf World Bank meeting. She spoke exclusively with treasury secretary jack lew. Sara, good morning to you. Reporter good morning, karl, david and jim. Jack lew is playing host this week to finance ministers and central bankers from around the world. He wants to project u. S. Leadership, engagement in the Global Economy, contrary to what were hearing a little bit on the campaign trail, but of course, we had to start the conversation with his recent clampdown rules on inversion. So, i asked point blank, was it your goal to kill this more than 150 billion merger between pfizer and allergan . Heres what he said. Let me be clear, the goal of what weve been doing here has been to deal with inversions as a matter of policy. I said several years ago, the right way, the best way to do it is for legislation to be passed that would do serious comprehensive Business Tax Reform and shut down inversions once and for all. I also said well use whatever Administrative Authority we have, and its a complicated matter because you dont have infinite flexibility. We have worked and worked on it. This is the third action weve taken, and each time weve slowed down the pipeline, and each time ive said Congress Needs to act because we want to make sure that inversions are stopped. I think that it should have been no surprise to anyone that we were working on this, because weve been working on it for a long time. I think how aggressive it was came as a surprise . I mean, do you understand the frustration of the companies who say we went about it legally, we played by the rules, and the rules got changed after the fact. Brent saunders, the ceo of allergan, told us it was unamerican. You know, what i think most americans understand is here we are in tax season. Most americans either have or will be filing their tax returns over the next few days, and they know that if youre on a salary, you pay your taxes every year, and thats that. The idea that a company could take advantage of all the benefits of being in the United States, the wonderful rule of law that makes us the best environment, the innovation thats supported by publicly supported research and development, the infrastructure thats supported by tax, paid for, roads, bridges and tunnels, and the education thats paid for out of our tax code as well. Reporter but i dont think it was a question of that. But that is the question. The question is, if you get all the benefits of being in america, doing business in america, do we have to change your address to avoid u. S. Taxes is wrong. We said we wanted to stop that, and we are continuing to look at what tools do we have. So, i actually dont think that anyone should be surprised. Most americans are offended by the idea that this can be done. Reporter but the issue was sort of the way of going about it retroactively. Even your predecessor it was not retroactive, lets be clear. Thats very important. What weve said all along and the way these kinds of things are done is it affects things that have not yet closed, have not yet taken place. You know, i dont know what else is in the pipeline, and frankly, our goal is to stop the pipeline. Reporter but the serial inverters like allergan who had made acquisitions, those acquisitions in the previous three years did not count. So, this question of serial inverters is a really interesting one. It took a while for the pattern to become clear that Companies Plan over a multiyear time horizon, to be able to build up a big enough foreign presence so that the inversion can take place where it meets the Technical Rules not to be subject to u. S. Tax. What im really focused on is shutting that pipeline down so this is not available as a matter of policy Going Forward. And as with all policies, its effective when. Reporter even hank paulson said hes troubled by the effort, saying were a nation of laws and rules and you cant change the rules after the fact and keep changing them and changing them. I think we have a wellestablished practice of issuing guidance based on legal interpretation, based on legal authority, and thats what weve done here. Everyone who engages in business knows that its subject to changes in law or rulings. And i think the important thing here is that everyone has been on notice for a very long time. It hasnt been a secret that this is an area of deep concern, bipartisan. My only frustration is that legislation hasnt been enacted to deal with it in the best way. But we remain focused on what administrative tools do we have to stop the pipeline as much as we can until congress acts, but Congress Needs to act. Reporter is there more to come from your office until were continuing to look at what options there are. I mean, weve obviously now taken a third action, and we have some of the best tax lawyers and tax analysts. And i have to say, the people who work on this are the most nonpartisan people you could imagine. Theyre Tax Professionals who are broadly respected for their ability and their integrity. Reporter so, potentially more rules on yeah, im not going to announce anything else. Im just saying, what weve said all along, well continue to look at what tools we have. Reporter then what would you say to a business, executives who already face so much uncertainty right now about the Global Economy, theyre trying to plan, and now the government can come in and change the rules in a way after the fact . How do you plan in that kind of environment . You know, look, i think to the extent that youre talking about mergers and acquisitions or Foreign Direct Investment in the United States, we are profoundly in favor of economically productive investments. What were not in favor of is using tax loopholes to move income around to avoid taxation. If youre working on a deal that has really economic benefit, this is not going to be something that interferes with your plans. If youre trying to structure a deal to avoid taxation, the goal was to make that harder. Reporter jack lew defending the recent actions and rules on inversions, saying it shouldnt have come as a surprise, addressing some of the company criticism and criticism from the broader Business World there. He also did not rule out that more rules are coming on inversions, said this was the third one and they have a whole team of nonpartisan tax lawyers working on this kind of legislation. The full interview with treasury secretary jack lew is on cnbc. Com right now. And in the next hour, guys, im going to bring you some more of that interview. We did talk about the current legislation thats going through congress on puerto rico and how the treasury is going to deal with some of their debt problems. We also, of course, talked about this issue of too big to fail. Calls are heating up for more action on banks. And karl, because i love you, of course i asked about Alexander Hamilton remaining on the new 10 bill, with everybody loving the play, and he gave me a hint as to whats to come. Ill have all that in the next hour, but for now, ill send it back to you. Thats called a tease right there, sara. Really nice work getting a lot of news out of the treasury secretary on a day where larry fink on our air stopped short of criticizing treasury but said he would have preferred a dialogue between the companies. Yeah, you know, i think, jim and karl, clearly, pfizer and allergan, the senior executive, the leadership there questioned how atune they were to this potential change. And regardless of what the treasury secretary says, when it comes to the threeyear lookback provision of those changes in the regulations that took place, it was designed to stop the pfizer allergan deal. And in fact, it was designed primarily with that in mind, at least based on the reporting ive done thus far, and bue beautifully done, because the people who figured it out knew it would effectively stop the ability of that deal to go forward, at least as it was currently constructed, and therefore, they abandoned it. The earnings provisions of the changes in the regulations may have more of an impact overall and will affect Foreign Companies that have u. S. Subsidiaries that have been trying to reduce their u. S. Tax bill. You know, theres so many different parts to this, not to mention, of course, the fact that theyve locked into a permanent bidding advantage, those companies that have already been inverted and that are in consolidating industries. Yes, right. But sara, i mean, when i look at the idea that youre not surprised not surprised allergan has lost 120 in market since the top. Right. Since its top. And those are people who were surprised, and they tend to be very smart people. Im close enough and done enough homework to know that they werent surprised, they were out and out shocked. They were. No, they were. Okay . They were shocked. And they were questioning why they didnt have a better sense for it, fair to say, in retrospect, or at least, theres nothing they could have done, because the provisions in terms of the threeyear lookback simply werent possible for allergan to get around to be the size that pfizer were to be able to make it aine version any longer. You and i were following this closely, going back and forth, and we both realized at the same time we just said, oh, my god, this is to stop the deal. I was shocked. You were a little blurryheaded about it. But when i figured out i said, this is truly unbelievable, given what i had heard from the two companies. And look, its he saidshe said. Secretary lew said they should have seen it coming. Maybe the tax advisers, maybe i dont know. My sources did not see it coming. No. I think thats a fair point. When we come back, well count down to the opening bell, well get cramers mad dash. The dow begins the morning less than 100 points from 18k. The last time we were there, july 20th. Back in a minute. Y, jesse. Who are you . Im vern, the orange money retirement rab