House. Europe is mostly green. The tenyear cracks 2. 51, Oil Inventories are headed our way. Our roadmap begins with retailers meeting President Trump. Wellknown Retail Executives headed to the white house this hour expected to make their case against a proposed border tax plan. Plus, the s p eyeing its longest winning streak in three and a half years with fed chair janet yellen back on capitol hill today, can the broader markets continue to hit these multisession highs . And pepsi beats on Strong Demand for healthy snacks and drinks. Hue johnson, the cfo will join us on cnbc. First up, Retail Executives set to meet at the white house this morning amid industry concerns about a border tax on imports. Including ceos of target, gap, best buy, jc penney. Later on the president will hold a joint News Conference with israeli Prime MinisterBenjamin Netanyahu before their white house meeting in the middle of the day. Jim, so many directions to turn today. Our coverage is going to sound a little bit different from what other Cable Networks are going with this morning. Whats important to you right now . Well, look, i think that the hot Consumer Price index, stronger retail sales dovetailing with what i think these people will have to say with the president makes it so were more than likely to continue the leadership of this rally, which are the banks. I know its very hard for people at home to grasp the idea that j. P. Morgan could be the leader of a rally, but remember if people want to go back to old days 1992 playbook, this is what led. And you got a multiyear rally from it. So i have to believe that as long as that leadership stays intact, i know it sounds almost prosaic, but we can continue to rally. All right. Of course goldman yesterday taking out that 22007 high. We mentioned going to talk to brady at house ways and means and then hatch, interestingly a list of winners and losers on this adjustment. Losers are obviously, under armour, ralph lauren, macys, but some of the winners, boston scientific, ingersoll rand, striker, coke, well talk about pepsi later. Well, look, i think the important thing is to look at the makeup of whos going there. So you have target and you have gap stores. Lets use those as examples. Those are companies that actually deal with the masses. Who voted for donald trump . The masses so to speak to use that great rubric that i think is going to play a role when he speaks with these companies. I think they can make a strong case. I think when the president leaves this meeting hes going to say ive spoken to the people who actually clothe and feed this country and theyre concerned about the border tax. Its a great narrative. Jc penney, what a great narrative to have. These are hes not meeting with Neiman Marcus or tiffany. Yeah, you know, i think important to step back and take a look at tax reform in its broader context because without a border tax adjustment there is a lot of consternation among folks who put this together in terms of whether it can be certainly revenue neutral or whether it really in any way can pass muster in terms of not being a deficit busting kind of a bill. And that border tax adjustment is the key revenue raise. Remember, you no longer can count your imports as a cost of goods sold, but if youre an exporter to carls point about some of those names he mentioned, exports are not taxed at all. This is key. This is key to bradys plan slash ryan of course coming out of house ways and means. If the president says something today along the lines of, yeah, were not really thinking about that as he did in the past where he said its too complicated in an interview with the wall street journal, although then came back and sort of indicates, well or the administration at least indicated maybe it would still be part of the plan. If he says anything, guys, that indicates no, youve got to continue to sort of figure out your odds for getting a full tax reform package done and whether they come down and what we end up with if you dont have a border tax adjustment. A tariff is not going to cut it at least in terms of the deficit hawks as far as theyre concerned. Yeah, House Freedom caucus remains resolute they would rather have something cleaner. The cfo of apple, which well get to later having set new highs yesterday, talked about this last night at a goldman tech conference. Take a listen to this. It is very hard for us to imagine that a border tax would be good for the u. S. Economy. Because it is a tax that would burden the end consumer. And the fact that the dollar would have to appreciate very significantly versus where it is today, which is already too strong. So, jim, how much of this that the market is betting on is productive . And how much is counterproductive . Well, look, i think we have to go back to the queue in addition to what david saying, it was ironic to see john mccain saying we got to bet back to tax reform and repeal of aca because of whats happening with possible investigation of the flynn situation. You push things back, make things more complicated. I have to tell you when i see the president meet with these executives, he tends to come back and like what the executives have to say. Its kind of like feedback loop that is very positive for whoevers in the room in that case. And i think youre absolutely right that the deficit hawks are going to say, you know what, we got so many other things to look into before we get to tax reform. Pushing back the 2018 scenario, apple, does it need it . We prefer Warren Buffett buying more apple, which he did, than we care about the border tax. At least for now. Yeah, although, again, i continue to believe tax reform is the major issue for businesses in this country. Its certainly one of the key reasons why so many investors have taken a bullish stance since the election in terms of the market because it would have ramifications for so many different companies. And to the point that maestri made, the dollar adjustment is key to the proponents to the border tax adjustment. The dollar they say will adjust but it will in fact increase in value so that will make goods less expensive therefore not hurting the consumer here at home. But of course will conceivably hurt a lot of export industries including, well, who knows, so many, carl, that could be hit by a rising dollar if in fact it does adjust the way they say it would. Yeah. Dollar riding an 11day win streak. That is the longest in an awfully long time. Speaking of deficit hawks, fed chair yellen back on capitol hill for a second day of testimony on the economy. This time before the House Financial Services committee as stocks aim for another fresh day of record highs. Apple as we mentioned poised to set another alltime high. And jim mentions Berkshire Hathaway nearly doubled its stake according to a regulatory filing along with this youll talk some nelson peltz, united, jim, some of the biggest positions in airlines hes had in years. Remember of course the u. S. Air position talked about do want to be in this group. This group is not a benign the stocks did drop in this period with the exception of southwest. But i think buffett once again got in on another wave of when the street was believing that perhaps the airlines are no good again. You know what, just to go back to the dollar for one moment. I think when you look at the dollar appreciation and what it would mean, theres a lot of companies that the president s meeting today at gap stores, jc penney, that dollar could go through the roof and it wouldnt matter. The cost to the actual working person is far higher as a percentage of their net income than it is to its just a giant tax on the people who frankly are struggling to meet ends. So lets keep that in mind. And Warren Buffetts not covered by that. By the way just in terms of Warren Buffett, a billionaire battle we dont talk about enough. Carl icahn when he sold the stock, he really made it clear that apples best days were behind it and they had problems with china. Buffett clearly did not believe that scenario. You throw in some shade carls way, jim . Well, look, hes with the president. But i do have to say that when you say that china was the problem, you got Mainland China, Mainland China is very strong for apple. Hong kong not that strong. But when i look at the mosaic of what apples doing, apple does not need apple needs a dollar that is stable. A strong dollar would amount to a terrible translation both for apple and for the company were about to talk about, proctor, which spends the most time of any Major Company i know talking about how a strong dollar absolutely hurts them. Yeah, that was interesting yesterday when apple set the intraday high, of course the dollar followed suit very closely. By the way, one coda on apple, to set record market cap we need to get to 147. 41 at the current share count. Right. There has been a change in that. They have bought back a lot of shares of course with all that cash. Though as we pointed out so many times back to tax reform 230 billion in overseas cash and marketable securities for that company. Certainly could imagine how much they would be buying back if it came back. Did want to talk, jim and carl, about Proctor Gamble which you briefly mentioned there, jim. Yesterday of course we told people when that 13f filing came out showed they have about half a billion dollars at trian, that wasnt the store they own 3. 5 billion of Proctor Gamble stock. The stock did move up after reporting yesterday after the bell. The question at this point is what happens from here when it comes to trian. This is the largest single position theyve had. They are both investing from the flagship fund. They also raise special purpose money for this particular position. And as you might imagine as we know well from having worked with them through the years they are very well prepared. So theres certainly a white paper associated with this position. But what has yet to happen is any sort of conversation between trian and Proctor Gamble. It was back in december, early december if you recall, when nelson peltz first introduced the idea of a new position. Take a listen. We do have a new position, david. Weve started buying about two weeks ago. We of course cant announce it now. We bought quite a bit of stock. And weve got quite a bit more to buy. And i hope that we will be able to talk in confidence with management and the board. And those talks still havent happened. Why . Because it took them a long time to get to the size position they wanted to. And they wanted to conclude their buying before actually beginning a dialogue with p g. So, jim, we dont know what is to come here. Of course trian will go to proxy fights occasionally, hines being an example, dupont being another example. But they also just focus on costs. Mondelez being an example of that where mr. Peltz is on the board. Unclear where it goes from here. Curious to hear your thoughts given, you know, youve known this company very well through the years. Well, pr taylors done a remarkable job taken product from 17 to 10. Got ridden of the empty calories of proctor. Divisions that werent making as much money in a very aggressive fashion. I dont think its about disposal of profit lines. I dont know if its about breakup. I would suggest its no doubt about the unallocated costs because progrector does have a in cincinnati. But mr. Taylors done a great job. This is a tougher one. I dont see this company as an underperforming company. I see this company as a company that can make even a lot more money, but boy its one of the best in the group. So i cant i await the trian proposal because proctors best in show. On the other side of this break well get Industrial Production. Later on this morning pepsis cfo. Back in a minute. Busy day for data. Lets get to Rick Santelli with Industrial Production. Rick. Yes, here we go. January read on Industrial Production down 0. 3 Capacity Utilization 75. 3. Utilization rates are close, Industrial Productions definitely a miss. And historically if we look at Industrial Production, this number really is interesting because weve had a lot more negatives than positives with regard to movement in this. And when i look at minus 0. 3, it isnt that big. In november we had minus 0. 66 rounded off to minus 0. 7. Bit of a miss there. But rates are up and dollars up. Inflation running a bit hotter than some of the retail Sales Numbers looked promising. Carl, jim, david, back to you. Rick, thanks so much. See you in a bit. As we said earlier pepsico out with results earlier this morning. Sara eisen joins us at post nine with more on that. Good morning, guys. Pepsico beating estimates on top and bottom line. Guidance coming in a little light. Want to welcome Hugh Johnston, cfo and vice chairman of pepsico, welcome back, hugh. Nice to see you. Nice to see you, sara. Good morning. Good morning. I know youve got to be feeling good, especially about that organic revenue number. Can you talk a little bit about some of the moves youre making not just cost cuts but the investments youre making to outgrow the categories both of slower soda consumption and slower sales of packaged foods. Absolutely. Yeah, we do feel good about the quarter. We delivered 3. 7 Revenue Growth and 15 eps growth. So certainly feel like we delivered a good solid quarter. As you mentioned more broadly, i think the year was a good year for pepsico and sets us up well for 2017. You know, in a lot of ways it starts with productivity initiatives that weve put in place. Weve been relentless in driving productivity over the last four or five years. Whether its out of our manufacturing operations, our Distribution Operations or management structures. And all of that productivity has yielded a sum of money part of which has been delivered to the bottom line which is why weve been able to perform so well on the bottom line. And part of which has been reinvested back in the business to drive growth. Our r d spending over the last five years is up 45 . Our m a spending is up 100 basis points and innovation in 2017 alone was 17 of the total innovation in u. S. Retail. You know, for that reason were base kri the top grower in food and beverage, little less than 10 of food and beverage sales in the u. S. And were almost 20 of the growth in food and beverage sales. Frankly thats one of the reasons why our customers ranked us in the canter rankings number one. We feel like we have terrific momentum going into the year. I know a big part of that is the innovation specifically around healthier eating, guilt free, better for you, something your Ceo Indra Nooyi has put in place years and years ago, hugh. So why conservative on the guidance . You do tend to under promise and over deliver, but what do you see ahead in terms of macros, currency and the business for 2017 . Yeah, youre absolutely right. I mine, indra has led the charge for pepsico for a number of years on moving the portfolio to where the consumer is going towards consuming healthier products. One fun fact for you in that regard, at pepsi cola, the name on the door, is actually about 12 of sales for the company. Meanwhile what we call everyday nutrition, which is healthy grains and proteins and fruit and vegetable, thats actually 25 . So everyday nutrition is twice the size of the pepsi cola business at this point in terms of revenue for the company. And that is whats enabling us to grow. As you think about going forward, theres really no concern about the business itself. We certainly feel good about the way the business is performing, but i think its fairly undeniable that the world has gotten gone from a volatile place to an even more volatile place over the last six to nine months. So when we give guidance, we certainly look to give cautious guidance to ensure investors understand that we are committed to delivering our guidance and well see how the year progresses. But given the volatility that we see right now we felt like the at least 3 of revenue and 8 on eps was prudent guidance for investors. Hugh, jim cramer, good to see you as always. Hi, jim. Wondering about good to see you. When we say pepsico as a company with 45 of the company lets sa good for you, a huge percent just kind of everyday daily good for you, when do we start thinking of the company less of as a carbonated company and more of a company that is a future way to be able to play what millennials eat . And then im going to throw in just for a moment, yesterday i had john legere on for tmobile, he said the return on investment on the super bowl was unbelievable. You obviously had the biggest name brand person during the halftime, lady gaga, how much again is this the idea of a food company down the road that looks quite different from all the other consumer packaged Good Companies . You know, jim, you make an absolutely fantastic point. We already think of ourself as a future food and Beverage Company. We dont think of ourselves as just a carbonated company at this point. Im glad you call that out because, you know, as we talk to you all in the media, as we talk to investors, we really do like to talk about ourselves as a unique food and Beverage Company thats much more innovative than most, much more productive than most and frankly is creating Great Results for consumers, customers and shareholders. Were already there as a management team. We just need to keep talking to everyone else about it. Specifically on the super bowl, i saw your interview last night and i thought it was fantastic. And youre right, what john said is exactly the way we felt about the super bowl. He ment