This morning. Yield curve continues to flatten and of course the fed minutes are on the way 2 00 p. M. Eastern time. Road map begins with target shares plunging after the Company Issues guidance. Call will begin in just over an hour. Goldman sachs downgrading equities saying theres no particular reason to own them. And fed minutes are coming out later today as the dollar hits a sevenweek high. Four years ago today facebook went public at the nasdaq. Shares priced at 38, now closer to 120 on a day where Mark Zuckerberg is set to meet with some u. S. Conservatives. First up, mixed picture on retail, target beats on quarterly profit but revenues and comps miss, Current Quarter guidance, lows better than expected results, comps up 3 surpassing home depot for the First Time Since 2010. And staples beats on the top and bottom line. Hard to remember a time where lowes its routinely the bridesmaid here, not this time, jim. Used to be for about four or five years during a period before frank blake got in. So now were going way, way back, frank is now retired. We want to see the breakdown of the month because home depot was up nicely, up a buck and a half before the call started. And in it we got basically a narrative which just said as the quarter went on things got worse. If lowes says that, then its going to be in keeping with what is now turning up to be a very bad april for the consumer. Yeah. Very bad. I spoke to somebody who decided to short home depot yesterday. I asked them why and they said, well, its trading at 19 times earnings, the comps decelerated during the quarter to your point, jim. They did. And then larger question to whether were going to see even more of a pullback as the president ial election season moves on through the summer and perhaps theres more uncertainty. I dont know the answer to that, but that certainly seems to play into some peoples investment thesis. As for target, jim, im just curious, i mean, they didnt seem to take all the markdowns that they maybe should have. The inventories are up 4. 3 whereas we know sales were down and Comp Store Sales were not where people or analysts who follow the company had anticipated they would be. And so looking at a stock down almost 8 . You read it absolutely perfectly. They didnt take the markdowns, where are the markdowns . In apparel, in consumer electronics, what is amazon done best . Apparel, consumer electronics. Now, by the way, target did have good online. I think target will struggle to figure out what happened. They could blame the consumer that puts pressure on a thesis that tjx and home depot could say, well, listen, people still spent, they just didnt spend as much. This is a watershed number unfortunately. I say that unfortunately, owned this since Brian Cornell came in, this is the beginning of what i regard as a may lets a what . A may lets. You mentioned politics, weather, politics, consumer are conspireing to either change their habits. And whey they still spend on they still spend on make up i have to say online is up 10 . Wages average is the highest since the recession. Were getting a government mandated increase in prices. Dont forget the huge, huge overtime decision that the president we have secretary perez on later today. That will be terrific because this is a very big move for the middle class. We have the minimum wage going up. In a lot of statestates, rig we have gasoline coming back up, we didnt get the benefit and now going up and we get hurt. Fed talk about need to raise rates to stop medical, which they cant do a thing about, which stop rent increase, which they cant do a thing about, and to stop commodities which they can do nothing about. So you have the worst of possible both worlds. Consumer massive slowdown in april getting worse in may, the fed very worried about higher wages, mandated by the government, and you have stock market that has no underpinnings other than potential takeover rumors. Right. You didnt mention when it comes to retail youve got amazon, which is something we have come back to time and again here. No, no, they renamed it. What is it called now . Gengkis khan. Most people dna matches up to his. What am i trying to say . What are you watson . No, responsible for more people Walking Around on this planet right now than any other human being in history. There you go. Weve talked so often about amazon and are we just now beginning to enter the eye of the storm for these retailers . Yes. You can get a very divergent opinion but those who are negative on Companies Like target will simply say its a value trap. The world has changed forever. And its not going back. I think its better than that because they do have a raise on debt. When you have a baby, you go there, when you go to college you go there. But when i go over that nordstrom Conference Call, which was devastating, devastating which basically said, listen, if you can tell us whats the matter, were all ears. You never want that. Its kind of like president roosevelt talking to general marshal saying, hey, man, what do you got there . You got anything cooking . Which did not happen because they had a strategy. I think they have no strategy. They have no strategy for how things have moved. In ordnordstrom or target . Target. I think youll hear that. I think that will be a thesis. The only guy whos explained whats happening correctly is ellison at jc penney, which is what does he want to do . Wood flooring, appliance, shades, window shades. Sophora makeup when you go outside you have to look better. And thats it. Beauty parlor. Kind of an ulta salon thesis. Nothing if not consistent, jim, on those calls. Well, you know what, i should have been telling everyone to sell everything retail other than makeup. Well, it does lead us to this goldman note today. Stocks poised to open lower in selloff, now goldman takes what it calls a fat and flat view on equities downgrading them to neutral over a 12month time horizon. Firm is upgrading commodities to neutral over three months citing some less Downside Potential regarding crude. In the note goldman says, quote, until we see sustained levels of growth recovery, we do not feel comfortable taking risk. Our equity strategists have become more defensive owing to heightened drawdown risk and growth scarcity. They like, as we said, commodities. They like some emerging market fx, but their point is until you see sustained inflation in the u. S. , stay in cash, overweight cash. Cant disagree. You dont have a problem . No, cant disagree with it. I happen to like his work very much. Im somewhat partial to how hes had some pretty good theses, but this is right, i think. Its a bad setup. Rates are up. Okay. The dollar goes higher on rate increases, the one area weve been starting to kind of warming up to is international, im waiting for the chinese baltic freight, maybe that can be a little bit of hope. But were in a moment where there is a way to get out of this jam, lower stock prices. Thats it . Sort of a theres one exit door and thats it. Thats the exit. Really think valuation. So you think were in a jam . Were in a jam for because the fed look, we have to have someone frl Federal Reserve do some homework. Sorry, i know its such a jam with all that netflix and activision, youtube is like seven hours a day and dont forget game of thrones thats a major impediment to doing homework. It is. But if they were on the jc penney, nordstrom wow, really depressed you. If they were on the kohls call, shut up and close it, sears doesnt have calls mercifully. No. And they were going to be on the target call and on part of the home depot call which talked about the deceleration, they would say weve got to stop talking. We cant come on and say two to three rate hikes because the consumers challenged and the only way the consumer get out of the jam is the government mandated higher labor costs, and thats what the fed is faced with. But instead they come on and theyre cheery. And theyre cheery because they havent done the homework, which by the way is such a drag. It was my daughters birthday last night, say, listen, i got to go, man. Study this home depot Conference Call more. Jim, they get every piece of data, they have data wrapped in data with data coming in through the data thats wrapped through the data. Come on. I got data too, and its what the consumers doing. And whether youre walmart, does that matter . Theyre not just in that brick ivory tower a few blocks away just sitting there thinking about it. No, theyre in front of microphones talking. Hey, you know what, these guys mr. Lockhart, i mean, broken clock, how often is that right, man . Thats dynamite twice. Yep. Williams, kaplan its okay to criticize them. Theyre just people. I went to school with one of them. A really good guy. I was in classes with others. Theyre really fine people. Sometimes i did better than they did, sometimes they do better than i do, sometimes they had better data, sometimes i had better papers, but thats all they are. Theyre people you went to school with. So that move yesterday in equities and in the twoyear, this is all part and parcel of what youre saying . Yeah. Lets not forget that oil as it goes higher is going to breed rumors of takeover since the memorial deal. But, you know, look, all im saying is you dont fed people should listen. They dont need to talk. But they seem to want to talk. And they make it very confusing. They make our jobs hard. Theyre part of the problem. Cleaver had it, man, and im not talking about beaver. So youd rather have them say were done. Id rather have them say, listen, guys, things are so influx. We dont know how much rate hikes would really do to cure the rent problem, the medicare problem. How do we do that . Rate hikes really address the notion the Oil Companies will not be able to meet their debt so then they wont be able to produce as much which sends gasoline up even higher. So they have to think about their narrative. And, yes, they have good data, but do they have good digital data, david . Do they know what amazons doing . Most of the ceos didnt. Im hopeful that they do, but i dont know. Theyre better than terry lundgren. They may not fully have understood the implications of the senior tranche of the cdo until it was too late. Then its a good chance to say nothing, do a little extra homework. I dont want to criticize them too much. The dog didnt eat their homework, but theyre woefully behind in terms of what the Digital Economy is doing. Whether it be uber, amazon, airbnb. All of those things also putting people out of work conceivably into the future. Right. We may have a cyclical increase in employment universal basic income, ubi, get used to that. But we have just an allowance as robots replace. As robots replace everybody. Bill gross, eric peters, everyone is writing about it. Thats what we need to do to keep unrest at bay. Its only going one way here. On twitter more than 70 of the people said david was indeed a simulation, and youre not even there. Im telling you i know your wife, i know your kids i got very lucky. They chose a good simulation for me. I feel like a very lucky man. Because it could have been a really bad simulation of my life. So far though not too bad. Were all simulations with the exception the fed. Theyre real. Theyve done homework and they want the stock market lower. Why not . You know, we have election. Just chance you get a simulation just by chance . You got to ask is someone deciding were going to give cramer a good life. And carl, but other people not so good for you. Tesla and amazon, and then oh, and facebook because its anniversary. And Everything Else other than takeover rumors, church and dwight, my friend, apache oh, you got it out there. Yeah. When we come back, the road ahead for facebook, four years after the social Network Stock market debut. What a day that was. Plus Charter Communications ceo tom rutledge, whats next for the company after closing its merger with Time Warner Cable . S p and nas down four of five, goldman taking tesla to a buy. More from squawk on the street in a membership. So what else is new . Hows your mother . Umm. Shes doing 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. We are witnessing a lot of american wealth getting generated as we speak after years of people taking risks dealing with uncertainty, unknowns, rivals and this is the payoff. The opening bell Mark Zuckerberg and facebook. Four years ago today facebook went public and since then the stock has tripled its ipo price of 38. Social network now is a market cap of about 336 billion, one of the biggest in the world. Even on that day we wondered if they were going to get out of the gate at all. Did not go well that day to say the least. Stock of course fell and dramatic failure on the nasdaq in terms of getting it working. But, you know, its funny because then we all started to revisit it after a couple of quarters even, jim, we said wait a second, maybe they should have gone public earlier in their growth cycle when things were really ramping. And then suddenly they came back, figured out mobile and that was it. Well, when Mark Zuckerberg said dont come into my office unless you have something thats on this, that was the term, this is a man who recognized what the market wanted, realized his numbers were decelerating, realized i think ahead of everyone that actually facebook works better on this, that instagram works better on this, so he has the he is the right mojo. Now, i got to tell you rgs i feel terrible for the people who cashed out. Because when stock went to 18 there were a lot of people on air who were as wrong as when it went public. And the ideas you had the stock market was up way too much because overrun by retail orders, once it pulled back at 18, 19, he started pledging he was going to fix it. And he was good to his word. I think he can earn 7 in 2018. I dont think its expensive. But i know in this market things are going to go down. But he figured it out. You got to give him credit. He did. You hold your phone up and of course this is a larger form factor as i like to say than had been typical not that long ago, right . The bigger iphone, the samsungs, the bigger screen certainly had to help. And has, i think, also ushered in a new wave of willingness to advertise and had video because everybodys looking at stuff on a bigger screen. And maybe theyre more likely to buy things. This gets back to our original conversation on retail too. Maybe i buy a shirt i see on here where i wouldnt have i dont know. This is your mall, okay. This is something that is so powerful that we dont even know what its going to bring us yet. This drives how you look. This is about you. Its about your pictures. Its about what you do. Take a look at what people do. Take a look at the way lives have changed because of this. And you realize its very disruptive for everything we talk about. And very disruptive for apparel. If you sell apparel, ive got to tell you you are selling spam. Check that whormel had a great quarter too. Youre right there was a time we took for granted the degree to which people wanted to show their pictures, message their friends and buy stuff easily. Yeah. And for the most part this is a better way to shop. You dont have to go anywhere. You just go to the site of what you want and then you go to amazon and you buy it for the next day for half of what other side of what you want. And theres a business model. Thats why youve got people spending an average of 50 minutes a day, isnt that right . 50 minutes a day the Facebook User spends. When you want to watch the mets win 20, do you watch it on this or on tv . If its blacked out it could be blacked out. I watched it last night on my big screen. It was baseball so i was reading targets Conference Call, time warner Conference Call getting ready for interviews but i was watching. It changed habits and zuckerberg saw it, a young person who is these people in retail, look at their ages, look at their backgrounds. Theyre older. They dont seem to be in touch with whats happening right now at this moment. And this meeting today with diment and glenn beck. I think glenn beck will say, look, i think this is a good idea, i think you should do this, this, this. I think theyll do it. Theyre very open minded. And whatever issues will be will be gone. Chinas different. They got all speak mandarin and they got to all go over there and say im not saying they got to be pro bigger charm offensive. Right. But they have to get china. Well get cramers mad dash as we count down to the opening bell, take one more look at the premarket which remains weak. Were awaiting the fed minutes, but everybodys still talking about retail earnings. Well get to this japan q1 gdp in a minute. The eclass has 11 intelligent driverassist systems. It recognizes pedestrians and alerts you. Warns you about incoming crosstraffic. Cameras and radar detect dangers you dont. And it can even stop by itself. So in this crash test, one things missing a crash. The 2016 eclass. Lease the e350 for 499 a month at your local mercedesbenz dealer. All right. Its time for a mad dash with jim. His voice may not be standing tall, but you are. I dont have the voice mojo, but i have the research mojo. Tony, a man that ive been somewhat critical of for saying for damning apple, basically keeping a buy but saying best days are behind it. Giving me a buy on it but questioning tim cooks leadership. He watches the show clearly, he even admitted he watched the show recently, he said hey, saw tim cook on jim cramers show. This is one of my shows. Yes, it is. 1 trillion target he uses today. 1 trillion. Thats how you should gauge it. Thats almost a double from here. Hes talking about a family plan. He said people will accept the family plan because theyre used to paying large amounts for technology utility, and apple family bundle could be coming. Opportunity to migrate to subscription model. David, david yes, jim . This is the key. This is the key. This is the key . This is the key because apple needs to do this in order to stop being just a hand set company. And tony is great. Yesterday he says this, today he says this. Thats okay because it makes the business fun. Okay. Its a long season, david. It is a long season. Its a long season were only a quarter a