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tv   Street Signs  CNBC  May 20, 2014 2:00pm-3:01pm EDT

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worth performance in some two weeks down more than a full percent. the winners are the inverse etf cuss to tell you about. d.a.g. shorts the dow. the short on the s&p is up about half a percent, and if you bet big with leverages etfs, you're doing well. that's it for "power lunch." "street signs" begins right now. the crisis continues to grow at general motors. it is now recalling another 2.4 million cars. that's your top story today, folks, and we continue our investigation into what is going on at gm. that, plus on the accelerating stock sell-off. the real tail that retail can tell us about the american economy is really doing? and marco andretti to stops by, about why he may be the man to
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beat. >> and the dow dropping to a five-week low, as we speak. let's bring in bob pisani from the new york stock exchange, what in particular is pulling us down. >> we were weak in the early part of the day because of the weak retail numbers, but then we saw some weakness in the middle of the day. right about -- a little after 1:00, we had some fed officials speaking, talking about the timing of the first rate hike, it depends on the economy, but mr. plosser was talking about rate hikes sooner rather than later. he is a bit of a hawk there. we saw the markets move down. take a look at the ten-year yield as so often happens, that moves the market. moving to the down side. once you start getting be -- it used to be 2.6, the mark tends to weaken. what's weak today in sectors? today is our old friend, the
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russell 2000. nasdaq, biotech, internet stocks which led the decline, that's what's weak today. both of them down a little more than 1%. not helping at all early on in the morning, retail sales earnings reports, including staples, all of them lower guidance for the second quarter. is the bottom line is it's not about the weather. the consumer just isn't there, at least for apparel, and overall entertainment, but sure not interested in apparel. i want to node, 12%, 18%, 7% declines in these names today, this is not a minor decline by any means. >> we're going to talk a whole lot more, but in the meantime the big story is general motors announcing yet another round of recalls this time, as brian mentioned, covering 2.4 million vehicles. the problems for gm started back in february, you might remember they initially recalled 788,000 vehicles for the faulty ignition
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switches. since then, they have announced a slew of additional recalls, some for reasons other than the ignition switch, like today. so this year alone, gm has recalled 13.6 million vehicles. as for the stock? actually it's down, only about 4%, since those recalls started back in february. phil lebeau has been working the story. tell us about today's recall. is this just a case of getting ahead of the bad news, getting it all out there so maria barra can reposition the company and move forward. >> at least it's all trying to get it out there. it's a series of recalls that general motors is announcing today. there's? staggering numbers. it seems like every week there's another huge multimillion vehicle recall. the one today, four recalls totalling 2.42 million. there's too many for us so list, but suv fires it nine models, thought models bill between 203,
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2004 and 2015. general motors will be taking another $200 million charge due to recall expenses in the second quarter. the one interesting recall in here involves the cadillac escalade. gm stopped sales on the sclads that are on showroom or on the dealer lots. they're also warning drivers of the 2015 escalade, there's an issue with the air bag on the passengers front side of the vehicle. owners have been called by general motors, and told about this issue. they've also been e-mailed, telling those people don't drive this vehicle until we can fix the issue with the air bass in the front. all together, 29 from general motors. 29. think all of 17 last year. total number 9 vehicles recalled. 13.6 million vehicles. the charges, when you include the additional 200 million for the second quarter with today's announcements, a total of 1.7 billion in charges, at least
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through the second quarter. again we're nowhere close to this being over for the quarter. take a look at shares of general motors. you know, for a while it was a stock that was trading close to that $34 range. that seemed to be some support. now we're seeing more than 2% -- actually now down more than 3% down closer to the $33 level. brian, mandy, back to you. >> the cars under the recall notice are expensive, right? that escalade, also the acadia, you're talking about air bags, you're talking about seat builts. is there anything that we can garner from the car and the equipment -- >> no. >> that says that gm is either making stuff wrong, or is getting cheap on the components it buys from the other companies? >> no, if anything, you can look at this and say in the past if there were complaints about a particular component general motors was likely going to issue a technical service bulletin. those bulletins are sent to dealerships, essentially you
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don't find out about it, but look, if this person brings in an escalade, there's a problem with the seat belt harness, it's not worthy of a recall, but we think you should fix it. what general motors has decided to do, as they looked at the potential problems over the last 10 to 15 years, they've decided instead, because the federal government is watching closely, recall it, don't wait around, don't do a technical service bulletin. if it's worsty of being close to a recall, just get it out there and recall it. i think what you're seeing from maria barra is let's not waste this, let's take advantage of this crisis and get all the bad news out. unfortunately no investors, there's no sense of when it ends. last week they had a recall for more than 2.3 million vehicles. i was sitting with you, and everybody said, is this the last of it? here we are, four days later. the question becomes, when is it all flushed out? >> let's try to dig in more on that topic as well, phil. bring in dave winston from
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charisma lone, from a stock perspective, the stock down a bit, not getting hit as hard as you would think. this is only from an investing in gm angle, now the company itself. are you concerned about gm here as a stock? >> over the longer term, no, not at all. >> still? >> yeah. >> it's recalling millions of cars for gaulty ignition switches, air bags and seat belts? >> i'm not saying i'm pleased. i'm tired of seeing it all the time, but, the major recall risk is on the ignition switch issue, which deals with vehicles that are no longer made. clear gm has work to do in the production process, but i agree a lot with what phil said and i'll add all these recalls now you just cannot have a repeat of what happened with gm recently going in front of, and what akio
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toyota good with toyota four years ago. no one wants to go through it. it's better to recall the vehicles and be safe. >> you're a crisis management expert here, and phil said we don't know when this is going to end. what would you advise to gm right now? quite frankly if i was looking to buy a car, i'm not sure i would buy a gm even if there was a discount with one on the block, because the gm dealers are trying to get rid of them. >> i actually agree, mandy. this has been a drip, drip, drip, that shows general motors is in damage control mode. there's no evidence this is going to stop soon. i do have empathy for mary barra. but this has gone on for so long. how is it not possibility for ash as clients suggested, that gm -- these are all safety-related recalls. which will be much more costly than the 1.7 billion in recall-related charges.
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>> i tell you what, there's -- i would go buy gm tomorrow, because this has happened to a lot of companies in the past. in indication that customers are indeed staying away? >> not at all. that's a great question. i've got to look at the data. thea shows there is no impact to sales yet. that could always change, but retail channel -- are up, and outstanding data from the new impala that came out last year. that took eight percentage points. they did not have to buy inand toyota avalon was the most -- >> phil, i would imagine that executives at various other car companies are watching closely as well. how have -- reshaped the auto industry from here on? >> at least here in the united states they're all much more reactive when it comes to potential recalls. in fact sergio marsh ion said
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sometimes a technical service bulletin is all that's required, but now we are, as in the industry, we're going to look and say maybe we should do a recall. he does not think that's a good position for the industry to be in. the flip side is regulators would say, look, if it should be recalled, recall it. i know you don't like to do that as as automaker. the fine like is when you have to make a recall and when you don't. nobody knows that. it depends on model and component. >> make your 30-second pitch to maria barra? >> i think they need to get more proactive. there are other things they could do other than accelerate the pace of recalls. one of the most sensitive and controversial issues is whether victims of defects that happened before the bankruptcy will be compensated. they are having an internal investigation and are looking at doing some things. i think they can state they're going to do the light thing and
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try to compensate as many victims as possible, where they're still in a cautious mode that's dragging it out and le efg them subject to criticism. i don't think we've seen the worst of this. i think when you see the ugly stories of how people are impacted, we will ultimately see an impact on sales. >> thank you very much to all of you for joining us today. we did mention that the stock is down about 4% since february down 19% since the 52-week high back at the end of last year. just how much are the retailer dragging on the overall economy? they seem to be dragging down the dow today. we will dig in. >> that leads us to today's mystery chart. all right, folks, pay teams, can you name this first stock. first hint -- it's bucking the trend by being the best retail stock this quarter. plus the s&p looks like it's bouncing off its low, but as we mentioned, we did take a dive
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halfway through the trading day. we'll watch all the way through the close, coming up. announcer: where can an investor be a name and not a number? scottrade. ron: i'm never alone with scottrade. i can always call or stop by my local office. they're nearby and ready to help. so when i have questions, i can talk to someone who knows exactly how i trade. because i don't trade like everybody. i trade like me. that's why i'm with scottrade. announcer: scottrade- proud to be ranked "best overall client experience."
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we are certainly watching this market sell off today. the dow is down right now, a lot of points, 153. that is just about a percent. it all started off with another round of bad retail news this morning. courtney reagan is here with us to run through some low lights. retail wrecked across the board
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today. tjx lowering its full-year earnings. a rare move for that name. staples continues to drop as it closing stores, urban outfitters, and get weighed down by costs the dick's sporting goods citing weakness in golf and hunting. weather was mixed in there, too. home depot fell short of expectations and it blamed the weather, but the commentary on the conference call was actually upgate, bay males described as robust, saying they aren't seeing signs. there are certainly individual company stumbles here, but the broader picture is -- so across the board. wage growth has been stagnant, but also more competition that is ever before. there are winners, but perhaps the wins aren't going to be as large as in the past. >> courtney, stick around. let's bring in jan rogers.
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i'm going to ask you for ten cents worth of advice on what's going on in retail. >> someone said just this morning or retails are they dragging down the economy? and i said how ridiculous is that. the economy is dragging down retail. if you're not having job growth, and not in the lower half of the economy, a lot of these guys will have trouble putting -- so i really think the economy is weighing on retail. yes, it's more competitive, yes the weather was crumby, but the economy isn't giving much growth, and we're seeing inflation in both gasoline and food, money's got to go there. it's hard to put clothes on your back. >> perhaps this is the most telling stat of the day. right now the best-performing stock in the s&p 500 is home depot. the worth performing two stocks,
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staples, isn't it just now more important what you invest in, what the retailers does? >> absolutely. i think that right now, competitive has never been tougher, if you're not an omnichannel retailer, if you're not macy's nordstrom's walmart, gap, you'll have a struggle. if you're trapped in the mall and not getting any traffic, you're going to struggle, so you have to be very selective. i don't think the urban division of urban outfitters will get fixed in the near future. yes, free people is great, anthropologie is strong. >> on the home depot note, they said specifically may sales have been robust. on that word "robust" you saw shares spike higher. we're hanging on every word. i'm going to trade that higher. when i say i, i mean in general
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the stock market remember, home depot sells something that works in-store. you want to go in-store to get the expertise to carry the lumber out, but they're also improving the online sales at a nice clip. >> and if you are a -- i know, jan, you've talked a lot about this, if you've got a sell at cost, but charge admission model? the costcos and sam's clubs in the world where it is works. >> yes, costco has per effected it. costco can basically sell at cost and charge you to come in the door and you're paying it, because you're getting a good deal on the product. >> you think you are. >> well, you know, it all works -- >> charge admission to the clothing store. very quickly you know my theory, which i've been saying this for over a year, and you've been saying i've been insane, retail
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weakness is good news, because people are buying homes and cars. they don't have the excess cash to spend on other stuff, right? according to the census department, putting out the official data, auto and other motor vehicle sales rose from april of last year. 7.7% jump in cars and car parts. >> and you left out one important thing. >> that tells me people are buying big-ticket things. if i'm buying a car, i probably won't buy a bunch of other crap that year. >> but they're maintaining the tech fees, monthly fees on the phone and ipad. >> i can't feed my kids, but i will have my three mobile phones. >> and he was saying what a big percentage that apple, amazon and samsung are taking in overall retail growth. >> that's true. the statistic we had on a few months ago, the average family now spends more on phones,
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internet and tv than they do on food every month. >> yeah, we left out netflix. >> courtney, you have a gigantic interview, hopping on a plane to minneapolis. >> we're going to be here. >> i thought you were going to minneapolis. >> we'll be interviewing john mulligan, the interim target ceo. he also is the c fundamentfo. we have another big event earlier in the day on "power lunch", so i want to play in all of those. i'm sticking around with all my friends, but bringing you the bur view nonetheless. >> so john mulligan answers a question incorrectly, do you give him a question to reask it? >> i knew that was going to come up. does he get a mulligan? >> not with you. >> i'm sorry i won't be here with you. i have a few questions. >> we're looking forward to it courtn courtney. thank you, jan. today is what some people are calling a super tuesday
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showdown. one of john harwood, and larry kudlow, they'll be joining us ahead. mcdonald's just declared game over in the war of creepy masco mascots. yes, that is a new mascot for mcdonald's. sadly. ♪ ♪ tigers, both of you. tigers? don't be modest. i see how you've been investing. setting long term goals. diversifying. dip! you got our attention. we did? of course. you're type e* well, i have been researching retirement strategies. well that's what type e*s do. welcome home. taking control of your retirement? e*trade gives you the tools and resources to get it right. are you type e*?
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we are bouncing a little off our lows. three stock are higher, by the way. home depot, procter and 2k3w578 able, and pfizer are being weighed down by caterpillar. happen super tuesday, folks. six states are kicking off the election season with primary votes today. the big prize this year, control of the senate. our chief washington correspondent john harwood is here, hey, john. >> hey, mandy. for republicans the last two senate elections have been a story of blown opportunities. the same tea party centering that fueled republican battles with president obama also pushed forward some candidates who for mainstream voters just went too far. >> i'm not a witch. i'm nothing you've heard. >> remember this ad from a candidate in 2010? but the tea party is still out
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there challenging the republican establishment. >> good afternoon, rchz. >> reporter: in fact this year it's taking on the most powerful senate republican of all. >> i voted for mitch mcconnell for years. over time he's changed. >> reporter: what's different this year is that republican leaders are hitting back, hard. mcconnell allies have used their huge financial advantage to pound his opponent in advantage of tonight's primary. >> he fail to pay taxes, then got a taxpayer bailout. bailout bevin. >> also tonight a conservatee backed by sarah palin is trailing, too. >> the conservative who has walked the walk. cutting budgets, not raising taxes. >> reporter: an establishment that republicans haven't cleared all their hurdle yet. that had cochran in two weeks will have to scramble to defeat his tea party opponent.
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>> crick mcdaniel, the new strong conservative leader mississippi needs in the u.s. senate. >> reporter: so far, at least, guys republican determination not to blow another chance. this time around appears to be paying off. >> john, you're going to stick around for a bit. we're going to bring if larry kudlow as well. >> larry, john focused a bit on georgia, right? probably one of the nastiest races out there. is that what you're focused on, larry, or is there something else we need to watch today. >> georgia is a key race. by the way, i think the so-called tea party candidate is not going to be a player. it will be between david perdue and congressman jax kingston. i don't know how that will work, but a lot of observers think they'll end up in a runoff. mitch mcconned, i don't know, i think he'll win by 20 percentage points or more, one out there in oregon, monica wehby, a very
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impressive candidate. oregon was not originally on the gop list, but it is now. my take is the so-called civil war between the republican establishment and the tea party. that war has kind of simmered, and they're actually working together better than people would have thought 30, 60, 90 days ago. >> larry, what i would say so that is there was a civil war, and the establishment this year, at least, has won it big time and squashed the opposition. to do that, you're right, the establishment itself has moved. john boehner was at a press conference earlier today saying there isn't that much difference between a tea party candidate and a average mainstream republican conservative. >> there's not that much of a difference 1234. >> not that much. >> something on this show might have disagreed with that statement last week loudly. >> somebody might have. that's exactly true. >> i will say this, larry, idaho is playing out john's point.
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on the one hand you have a tea party candidate, and then somebody -- so i'm trying to figure out where the difference is. >> you know, that's an interesting point. the club for growth has been a tea party backer, but they walked away from the guy in idaho. listen, sully, as we talked about last week, you know, and i appreciate and respect your issues on the republican party, all's i'm saying, i'm going to say it again today. the gop is getting a message that they must be a big tent, okay? that doesn't mean limited spending and lower tax rates and deregulation. they're not going to give up their principles, but the tempers i think, the tempers are lower, the cooperation is greater, they see a great chance to win. i would say right now, i don't know, john harwood where you are, but i would say right now the gop is in very good shape to take the senate, maybe by a seat or two. >> i think they've got a good
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channel. let me ask you one question, though, about the -- i think there are two issues as we look ahead to 2016, how much emphasis do we play on economic issues or social issues. that's a -- even in the near term, on economic issues, what do you make of mitt romney, rick santorum and others say, hey, republicans in congress, raise the minimum wage. >> yeah, i don't like it one bit. i don't like it one bit. i think the gop needs, john -- it's funny, i was moderating a panel at the republican governors association here in new york. i don't think the republicans have yet a clear, clear national economic growth message. but when you look at the numbers, obama, you know, on the economy, he's slumping, in the low 40s, as he is overall. the minimum wage is not going to be a truly national issue. anyway, it kills jobs at the low end. >> santorum says that's how you have to talk to blue collar conservativ
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conservatives. >> i think santorum was wrong on this point. on this point i think he was wrong when he ran last time, and i think he'll be wrong if he runs on it against this time. i want immigration reform on the table. i think the gop needs a facelift. >> yes, it does, larry. that's sort of the point. >> yes. >> if we're talking about poll after poll after poll of people saying we support a higher minimum wage, we support immigration reform, you don't have to support them both, but study after study shows that most people -- that is the point of what i was saying last week, if the republicans want to lose every election for the rest of our life, they can ignore what most people want. the point of an election is the majority victory. >> you're exactly right. >> at least that's what i thought it was. >> if you and larry kudlow can get the republican party to take up and move on immigration, you would be a hero within the democratic party and also jeb bush and all the people who want to run for president for the republicans in 2016. >> that's a little cynical. >> that's a job for larry, not me. >> i don't think the minimum
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wage is the big issue. the economy, the lousy performance on jobs -- >> wait, i said immigration, not minimum wage. >> i understand, but i'm surfing back. regarding immigration, it's pro-economic growth, both the brainiacs at the top as well as the low-wage workers at the bottom, there's a shortage of workers. i also believe the immigration reform issue is a symbol. it's a symbol to the republican party that needs a new face. it's a symbol to asians, to his spannics, a symbol to after kaj-americans. in some sense it's a symbol to women and young people. the gop is open for business. that's why i think immigration is important and, by the way, it happens to be very pro growth. >> closing point, it will improve our relations with australia. >> australia is a great country. and so is our favorite anchor from australia. >> by the way, minimum wage in
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australia is what? >> over $15. >> they're always the happiest people in the world. >> that's right. >> of course you get to like six to eight weeks vacation, but it's always sunny, minimum wage is high. republicans need to be more inclusive. >> larry and john, thank you so much. by the way, we're going to be talking cars and helicopters with street talk on deck as the markets are off their lows, but certainly very much in the red. >> don't forget about today's mystery chart. the first hint was the best performing retailer, second hint -- it started it life as the thrift-d center before changing its name.
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that corporate trial by fire when every slacker gets his due. and yet, there's someone around the office who hasn't had a performance review in a while. someone whose poor performance is slowing down the entire organization. i'm looking at you phone company dsl. check your speed. see how fast your internet can be. switch now and add voice and tv for $34.90. comcast business built for business. time for street talk.
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let's move for the first stock, netflix. tell me the stock -- it is a down day overall. >> and the annual cyst settic the price target at $42 a share for net flick. folks that's about a 15% up side. about $408 on weight. they think the internal tv aspects of netflix's core business are undervalued. piper jaffray defending g e gamestop. >> not helping today, but bigger market down day, most stocks, stocks already down, by the way, 25%, year to date. customers are going after games for the new consoles, right? they expect the company to not change forward guidance, maybe even some of the stilts out there could be conservative. this is also, folks, one of the most heavily shorted stocks out there. if it does move higher, it probably will move higher
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faster. >> smith & wesson. >> boosting it. it should. the stock is already above -- the channel checks show that in the firearms market, smith & wesson has gaining market share. >> under the radar, it's -- they also are getting a nice upgrade today. >> a helicopter medical transport company. >> base the in englewood, colorado, going from 58 to 56. about 20% up side. time for aural talking numbers segment. today that stock is we have the earnings tonight. the stock down 15% in the past 90 days. rich s. first the technicals, because this a high volatility
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tech names, what is it is charts tell you. >> i do not like technology here. is a stock you want to sell. very hot start to 2014, the stock. we take out both the 50 and 200-day in the process. importantly that 200-day is now a ceiling of resistance around $54. brian, when we pull back and look longer term, the story goes from bad to worse. look, we're up 1100% over the last five years. that's a fantastic run. pigs get slaughter. when i see a head and shoulders top, i know we're going lower. look at the 150-week moving average. it provided support on two occasions. i think we test it again. 23% down from current levels. that's where i want to be a seller right now in anticipation of that move.
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>> so the question is whether or not the fundamentals will -- for a sell on this stock. >> we're neutral. we don't hold it in any of our advice portfolios, but not looking to at it. currently trading at about 105 times forward 2014 earnings. of course that sounds lofty, but it is expected to grow at 40% on nongaap earnings, the problem is i think the gaap e. is what's weighing on the stock. they're stock-based compensation has become an increasingly larger and larger cost over the past five years. when look at gaap earnings, we're looking at negative earnings for the past three years. we're expecting them to report tonight. we expect them to beat top line revenue estimates. they've been pretty conservat e conservative, but i would exec ten cents per share in order to
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see the stock bounce up. >> erin and rich, thank you very much for your thoughts. check out "mad money" tonight, because jim will be speaking with the ceo at 6:00 p.m. eastern right he. and be sure to check out the online edition of "talking numbers." folks, one last look at the mystery chart. this the best performing retail stock this quarter. some smart people that we've got watching and listening have already guessed it right. they guessed it right. >> there's your hint, guys. plus microsoft unveil the new surface. we'll discuss that next as we are down 160 points there on the dow right now, and the ten-year, folks, 2.509%. don't go away. tdd#: 1-800-345-2550 searching for trade ideas that spark your curiosity
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aid. they got it right without aid. microsoft unveiling a larger and lighter version of the surface protablet. the ceo sets the company is going after the, quote, laptop replacement strategy. will it work? joining us is dan ives, and jon fart -- fort. that's one of those slip of the tongues that will come back to haunt me because of the stupid internet. jon fortt, what was your take on the surface tablet? >> i smelled that? i got one here. it is indeed light, and it is bigger at 12 inches. interesting, though, it starts at $800, just base level. the keyboard is another $130 on top of that. i was talking to an adobe executive who thought it would compete with mower the mac pro.
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microsoft didn't decide to package the keyboard with it. i think it's an attempt to pull the ecosystem up, preserve margin, within the system as more of the devices take on this touch functionality. >> i think you hit on the point here, the price, $7999 for the lower end i think $1949 for the higher end we were saying who will pay for this product here? >> microsoft definitely took a step in the right direction in terms of what i in the is a more, you know, competitive tablet that could do this laptop replacement, but again they're late to the game. the price points continue to be a bit of a head scratcher. this is be his challenge. he laid it out good, the launch, but it's an uphill battle. >> a head scratcher. the surface is a neat device. i've said i like that operating system, but i well on dell's
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website. getting 11 1/2-inch, touchkorean, 4 gigs of ram, touch-screen laptop for $420, for another $179 they'll throw in an 8-inch tablet. >> reporter: but, but -- >> go ahead, jon. >> the key is the intel processor inside. the processor is of such high performance quality, can do high-end graphic rendering computer-assisted design, the stuff that architects and doctors may want to do. it's playing to the high end, the mac book, air and above really the mac boo pro demographic in an attempt to prevent the continued race to the bottom with chrome books and other cheap pcs that's taking the margin out of this business. 'em computing margin, if they can pull that up with innovative designs like this and bring more of that margin back to windows that benefits them, benefits intel, potential others like
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year le novaos, if they can start to sell more devices. >> if we just bring it back, step back for a second and look at the make rob picture. nardelli took over in february, he's done some good things, made some inroads, but ultimately do you think he'll succeed and turn around the hardware section and the devices section? >> he's definitely talked the great talk, you've seen investors giving the benefit of the doubt. that will be the big issue. can he turn around mobile with nokia, can he turn around surface? again it's definitely putting a boulder uphill in terms of what he's trying to do, but i think he's taking steps in the right direction. we saw surface as a more competitive product, but he took over the cleveland browns. he's trying to turn it around, okay? it's going to take time. i think you're starting to see some optimism. he has the breath of fresh air as we saw the decade with
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balance mer. >> and anybody buying the surface? do they sell any? >> i walked through times square i i think i saw one guy with maybe the surface. is this going to be the catalyst? i think the injure is still out. >> thank you very much. >> they're going to sell a few. >> i also like the writing on it like a notepad with a pen feature as well. dan and jon, thank you so much. we've been talking about the economy a lot today. it doesn't seem to gain traction, but most economists would not call this a recession, but bill griffeth, you'll have somebody already saying we are in a recession. >> and he's looking at the markets. this is doug borkwith, head of foreign exchange trading. the foreign exchange markets are signaling very different things that the stock market is. you know, we ponder why the yield on the ten-year treasury, for example, is as low as it is right now. does it mean we'll see a slowdown in the economy?
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well, doug is willing to go out and say something that people are thinking, but not willing to say, that maybe, maybe, we're in the beginning stages of a recession for the u.s. economy. >> and he's looking at the market, but the market is at all-time highs. >> that's what i'm saying, the stock market is signaling different from the currency markets and the debt markets are saying right now. two very different stories. >> there are many people who have been calling for five recessions in the past three years. >> i agree. he may be one as well. but here's somebody who's having to trade on that. he's saying maybe a recession is starting right now. we'll stalk to him. but well bill miller with us tonight one of the legendary equity managers, and he's still bullish on the stock market. >> both sides, as always. thank you, bill. the nasdaq again selling off more than the dow today. we're going to look at the closer look at the mochers. >> can the nba win in the home court as they move to strip donald sterling of the clippers?
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we'll have the debate ahead.
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true business-grade internet comes with secure wifi for your business. it also comes with public wifi for your customers. not so with internet from the phone company. i would email the phone company to inquire as to why they have shortchanged these customers. but that would require wifi. switch to comcast business internet and get two wifi networks included. comcast business built for business. a dramatic drop in gold demand by major gold-consuming countries, china and india. consumer gold demand in china
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fell 18% the first quarter. indian consumer demand was down by just over a quarter and even gold jewelry consumption there dropped by 9%. guys, the most dramatic fall-off of all in demand was for gold coins and bars. both down over 50% in both china and also in india. meantime, let me quickly show you what's going on here behind me. the nasdaq 100 is what we're looking at right now. percentage terms, the nasdaq 100 is selling off more than the dow once again today. the biggest gainer though, you can see up there at 300 bucks a share is amazon, ordered a bunch of stuff for my son's birthday yesterday, maybe that's helping. state will, talking about this one already. biggest loser. down by 12% today. forecast a decline in sales for the current quarter, and it's absolutely getting slammed, along with a number of the other retailers. brian, back over to you. >> mandy, thank you very much. the nba moving one step closer of stripping donald sterg from ownership of the clippers but does sterling have a real case to keep the team?
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joining us attorney and professor at san diego state daniel eaton and mitch ebner, former assistant u.s. attorney. does don sterling have a case to keep the team and go after the nba, go on the offensive? >> i think that he is going to be dumped on. he has no chance in this case. >> why not? >> because he signed on to the agreement that basically says if three-quarters of the teams wants a member out for specified reasons, they are out with essentially no recourse in the courts. >> dan, would you agree with that? not completely. no recourse as long as they follow their own constitution, and, look, there are -- there are ten grounds under which a team can be terminated. you have to get a three-quarter vote of all owners. mitch correctly says that the federal arbitration act might apply if this is challenged by mr. sterling in court. well, one of the grounds on challenging an arbitration ruling, in this case the ruling of the board of governors is the
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quote, evidence, partiality, close quote, of hose who decide. the fact is an awful lot of team owners who constitute the board of governors have made a lot of very, very strong statements about this matter. is that enough to show that there is really no possibility of getting three-quarter vote of all owners or sufficiently impartial to make this a valid ruling. >> you know, i want to jump in on what dan just said about evident partiality. >> in plain english though because -- why should these guys be impartial? they are ticked off that one of their own has disgraced in some respect the nba by being an owner still of a team. >> you're right and they have also been very careful. outside of the owner of the kings and mark cuban who is the owner of the dallas mavericks, very few, i think maybe one or two others, have made public statements, and i don't think that's by accident. the joke has always been that nba stands for nothing but
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attorneys and the lawyers have done their job in protecting their league here. >> dan, you found that funny. >> i did, because, you know, you have to look -- we are talking about due process here, and we're talking about a careful parsing of the nba constitution. one of the ground, the grounds that has been most frequently cited for mr. sterling violated is that he violated his, quote, contractual obligation to the team. let's all agree what he said was repulsive and awful and what he said did damage, what is it a violation of contractual obligation, what mitch cited concerning whether you say something prejudicial to the league really can't be called upon because it -- it calls for a specific remedy of $1 million and that's not what the commissioner relied on in issuing the $2.5 million fine. >> i think we proved your point, having a legal discussion about the nba, you're right, mitch. there you go. appreciate it. thank >> you coming up next, why
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prepare to be creeped out. mcdonald's new happy meal mascot is named happy. i think weird and creepy, whatever, is a whole lot more appropriate and what's more out there in terms of creepy mascots. >> lump happy in with some of the other ones like the burger king guide gui and the king cake
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baby, right there, and probably the creepiest of them all, wenlock and mandeville, the 2012 junior mascots, one in a diaper. >> the other one needs spanx. guys, the market is selling the lows but down 157 points there on the dow and the small caps are leading us lower. we'll keep on watching. >> and welcome to "closing bell," everybody. i'm kelly evans down here at the new york stock exchange. bill, we've got an afternoon selloff, some pinning it to comments about interest rates possibly rising sooner than expected. heard from a lot of fed officials today. >> all kind of reasons why. we're going to go over. i'm bill griff et here at headquarters today. it all started south when the philly fed chair made bullish comments about the economy saying the fed may need to raise interest rates sooner rather


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