Changes are taking applauplace. Well go there live in a few minutes. The ceo of the lending club is out and the stock is falling very hard in the premarket. We will give you the latest. And donald trump saying the rich will probably pay more taxes if hes president. Will support shift now that hes backing earlier proposals to reduce taxes on all americans . Futures are off the highs of the morning following a down week for the markets, one which saw the nasdaq dip briefly into correction territory. Growth in the mix, a bigger than expected drop in chinese imports and exports last month. Overnight, shanghai fell by almost 2. 8 . Imports down 10. 9 , was a bad miss. Then we had these ongoing concerns about them pulling back on some accommodations. Yeah. Look, china and oil both negative today. This china situation looks like there wasnt a lot of speculation, obviously, buying these commodities. Now, i still believe that the domestic markets better than people think, but was it a blip up . It is very hard to try to come one a reason why there was so much buying of commodities. I know that infrastructures strong. Were seeing some comments about infrastructure that are positive, but wow. China is back is a problem, okay . Its back is a problem. It looks like theyre getting hurt by tariffs. I think theyre getting hurt by us. I think we hurt them in steel. You do . I really do. As a result of the tariffs that yep. I think theyre flooding us with steel and they have no place to put it. The wall street journal, a good piece yeah, theres a good piece in the journal about the fact that they keep subsidizing much of this production, despite what theyre saying that they wont. Looks like the communist party failed in trying to rein in these economies. Im hearing from these articles that there was basically an attempt to try to close these places and they have it, but theres no place to put their stuff. And they imported so much of the wrong goods that you need to make steel. It is amazing with that economy there are two economies there. There is the domestic economy where there is spending, and then theres the economy that just puts out steel endlessly when theres no place to put it. Steel is for building materials. We make it and they make it, and australia, everybody, korea makes it, japan makes it. Nobody needs it. Meanwhile, weve got the dow and s p down two weeks. Nasdaq down three weeks. Yeah. Were going to get some big names reporting, the disneys, as we mentioned, macys and some other big retailers. I think disney has a compelling story in movies. Obviously captain americas not included in the quarter, but no, but fifth biggest Domestic Opening ever. They have quarter after quarter after quarter after quarter theyve got something. So, maybe the narrative changes . The bspn has any bounce at all, then youre going to be paying much more for this. I dont know. I dont think anybody knows. But thats the story of the week. I think macys i think the malls really in trouble, guys. I really do. I know that Simon Properties did s say, this reports in the death of the mall totally exaggerated yeah, i wasnt at i was there, but i must have missed that specifically. Theres so much going on. But it doesnt matter, they dont relate to each other, okay . They do not relate to each other. Well, people do wonder, because theyll look at Simon Properties group and theyll look at the stock of macys and say, well, which one is wrong . I think that the wrong one is that simons right because theres such a scarce theyre not building any new malls. So, theres people so, you cant expect them to correlate at some point. You cant expect simon is fine means macys is fine. Yeah. I mean, look, youve got these reits. If you look at the makeup of them look, Sports Authority closing places. A p closed places. Doesnt matter. These are longterm leases that these guys are thrilled, theyre thrilled to be able to break the leases, throw some in money and then bingo. So, no when i look at macys, i just think that, okay, bf corps wasnt that bad, sell a lot of macys, so macys wont be a disaster. And the stock has come down big. Jcpenneys has come down big. Theyve come down enough to make a positive story. How about the german buying krispy kreme . Theyll have caribou, peeps, einstein and now krispy kreme. Greatest place in the world for a coffee and bagel. Doughnuts . They own keurig as well. They own theyre trying to corner the coffee market. It does seem that theyre busy. Right . Krispy kreme, i remember when it went bankrupt, and of course, it came out and now is being sold at a nice premium to fridays close, about 1. 35 billion overall price. Krispy kreme Big International business. 70 of the store base is international. People forget that. As they opened, nobody seemed to care for a long time, but ive got to tell you what is it, private Family Office . In a sense. I mean, kind of. Not really. But Bart Beckett Peter Harf and this guy, bart becht, he runs jab. They dodged a bullet there, huh . Its private. Boy, they did. Avon should have hit that bid all day long. Oh, my that was something, wasnt it . Sometimes there are deals you should take. Yahoo should have taken the microsoft deal at whatever that was, 31 cash and stock. P per goat should have taken the milan deal. I thought keurig was suspect, but the core business is good. Einstein bagels, so, you get bagels, you get doughnuts, you get some really good coffee. Stump town are you worried if youre Howard Schultz . Yeah, hes one of the few people i dont have to worry about. And i think that starbucks my Charitable Trust is in starbucks. Are they trying to put together a powerhouse . Krispy kreme has had a great brand and caribou, peeps, yeah, theyve put together all of the competitors of starbucks, but i think theres room. I think theres room for Dunkin Donuts, too. Its interesting, i think Dunkin Donuts one day will be stuck with these styrofoam cups as something that the millennials dont like. International paper told me that. You mean serving in styrofoam cups they wont be able to do forever yeah, because the world is changing. It creates waste, enormous waste. Yes. Cant be recycled. No. In the event of nuclear war, roaches can drink out of those cups. And it ends up in the oceans, basically. All this stuff ends up in the oceans. Velveeta. Look at what survives in the event of nuclear war, velveeta, styrofoam cups. Put the velveeta there on Easter Island and [ everyone talking at once ] the state of texas . Speaking of terrible. Speaking of things that come out of the earth or dont go away, oils being impacted by the continuing canadian wildfire. Thats cut more than a Million Barrels a day from production. Then we had this sweeping government shakeup in saudi arabia. Our hadley gamble is live in riyadh with the latest on that. Good morning, hadley. Reporter good morning. Basically what we know right now is there is a new oil minister here in saudi arabia, Khaled Al Faleh. He is a 30year veteran of aramco, taking the place of ali al naimi, who yesterday said goodbye and thank you to his colleagues at aramco. Hes thanked them for helping him make all of those tough decisions, and he essentially is going now to become an adviser to the royal court. So, a lot of hoopla in the press, whether theyd be in the west or saudi arabia, about whether or not he was ousted or fired. But the bigger question Going Forward is how Khaled Al Faleh will ease the way for aramco. Thats part of the debate in saudi arabia about where this company is going to list its 5 stake of aramco. It will be the biggest ipo perhaps in history. An article in the telegraph newspaper suggested it would be a tri listing in new york, hong kong as well as london, but the ceo of the Saudi Exchange telling me last week it would be listing in riyadh. Another big question is whether or not Big Oil Majors like exxon and bp and sinopec will be able to take strategic stakes in the company. So a lot of questions surrounding this big reshuffle. And the question, of course, here for many people is is this going to impact saudi policy . What im being told is thats not going to happen, at least in the near term, but it speaks to the broader reshuffling and realignment of power behind the royal court. And of course, thats something that mohammed bin salman, the crown prince, and king salman, have been very keen to do. Guys . Hadley gamble in riyadh with major news over the weekend. Hadley, thanks. Netnet, bearish to you, jim . No. I actually keep thinking about that underwriting, the saudi aramco underwriting and whether theyre positioning that deal in a way that they could turn the spigot off, put you know, theyre doing 10. 5 million. By the way, theres additional 500,000 being from opec coming to us since the beginning of the year. Coming into this country. Coming into this country. Saudis doing 10. 5 Million Barrels a day. Were doing about nine, right . But weve come down. From ten. Yeah, were going down to 8 1 2. Its all coming together for oil, so i dont want minute to minute, it looks like were down today because i think the people got a little too exuberant about how long canada would be offline, a Million Barrels a day. Very interesting changes there in saudi arabia. Of course, we talked a number of times over the course of the last 12 months about how theyve hit the International Debt markets, how they can finance their war going on in yemen and other places at the same time that they can keep social unrest at bay within the country itself, all the time dealing with what are much far Lower Oil Prices than have been the case for the last few years. Remember, the shale a lot of these companies had hedges put on for 2016. The hedges are coming off in our country. So youre going to see another step function down in our country in terms of production. I think were down a million another 500,000 barrels by year end. And its all being picked up by opec, which i didnt think. I thought there would be other countries that could make good, but mexico not were hugely exporting natural gas to mexico, even though theres a surplus of natural gas like never before. Inventorys the highest its ever been. That thing cant go up to six. Despi despite that shaaneers sending yes, the trains have opened up your point is that 50 doesnt necessarily bring about a response in production . I think that the longer we are in this country, the longer these marginal companies have to go before we get to 50, the more likely that credits being cut off. And were seeing credit being cut off in a lot of different places. Its a significant amount thats coming off. And thats why im not nearly as fearful of iran as others. But oil day to day has controlled our market and its gotten a little ridiculous. When you see some stocks that were up really nicely an hour ago that are now down because of oil trading down, it is a little insane. Oil definitely driving the bus today. Higher earlier this morning but now off those highs. When we come back, lending club tumbling after its ceo steps down. And then donald trump sending a message on taxes thats not good news for the wealthiest americans. Take another look at the premarket as we kick off this week. As we said, the dow and the s p down two straight weeks. More squawk on the street from post nine in just a minute. Lending club has accepted the resignation of Renaud Laplanche as its chairman and ceo. The board determined laplanche violated the companys Business Practices following a review of sales of near prime loans. Lending club says president Scott Sanborn will take on acting ceo duties with Board Director hans morris serving as executive chairman. You can see this news pressuring the stock significantly. This does appear to go back to actually something that began with the review of a Smaller Group of loans, 3 million of loans that appeared to have had the dates in terms of the application dates changed. This got the attention internally of some people who then instituted a review that was expanded. And they found that 22 million in loans that were going to be bought by a certain institution, which i believe is jefferies, the documentation from those loans, you can document things one way or another way. And apparently, the buyer in question liked certain documentation done one way and these were done another way. This is not a huge issue, it would seem, but in the internal review they found this to be the case. And what really seemed to have happened here, guys, is that once the board started to sort of look into this and asked mr. Laplanche questions about it, what i am told is he was not as forthcoming as the board would have liked in terms of simply answering questions, even though these really did not appear to be major issues. Were not talking about at least it appears at this point loans in some way that are in any way fraudulent. It simply had to do with some relatively minor issues potentially. But were talking about a board that includes john mack, of course, former ceo of Morgan Stanley, lawrence summers, former treasury secretary of the united states, mary meeker, well known, of course, former analyst who moved to venture capital. Youve got a lot of strong people on that board who my sense would be, said hey, were not going to allow our reputations to be besmirched in any way. If theres a trust issue with our ceo, hes out. And i cant give you more specifics than in terms of what those conversations were like. The company is saying that to the best of its knowledge, there is nothing more here than what they have disclosed, though they will be delayed in reporting their First Quarter numbers. They asked for a request to extend the First Quarter on or prior to may 16th, 2016. So, well see. Wow, okay. I mean, i just know when i had been very critical of the company, i had mr. Laplanche on, he was talking about, you know, the transparency that comes to the marketplace, its very important to hold us accountable. I mean, its not our money, its our investors money, meaning we have as much skin in the game as anyone who has investors they respond to. In other words, transparency was the key here. Well, if thats what youre selling and then your ceo is not being as forthcoming as the board would like when theyre looking into certain issues having to do with what borrowers excuse me, what buyers requested and what they were getting, you could see why they might say weve got to move on. So they were not jamming an account. It doesnt appear thats the case. They did take the 22 million in loans back, and its 150,000 writeoff, i think is what theyre talking about of that. But that wasnt really the issue, jim, not the quality of the underlying loans, but the documentation associated with them that was not what the buyer was requesting, all coming out of a review that began with something that does appear to have been more serious, perhaps, which is a change in application dates for 3 million of that 22 million loan package. Thats very i mean, highpowered board. Obviously, the chicanery seems minor, but it does matter. Rough statement. Have you been critical of the model overall . Yeah. I mean, like ive been saying, whats the deal here . Do you use the same are you really going to have the underwriting standards of major banks, and they were saying absolutely, were going to definitely have the highest underwriting standards. I do think that theres also a toughness to this market. Now, they did have good growth in loans. But remember square last week where they talked about how in tl were some issues involving the strength of the market . You mean credit conditions. Yeah. Yeah. I dont know about this model. Its a new challenge. Relatively new model. Well, i mean somewhat untested, and this doesnt help, even though this does not appear to go, jim, to the crux of peoples concerns no, it doesnt at all. To the extent that you have them. I know this will sound silly with the stock down. Im actually more less concerned about lending club. I had thought this was a tip of the iceberg. Doesnt sound like it at all. You never want to say that completely, but i would agree, at least based on what we know so far and what ive been able to learn. Lack of any quarterly or annual guidance. Right. Leaving some people wanting today. Yes. I just think that this look, theres a lot of Competition Among loans, and i dont know if you need. By the way, sometimes when guys are lending money you dont think theyre lending i didnt think square was in the lending business. Right. I dont know if they thought they were in it. 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