i think that's good for margins. >> look at that grin. he's going to pound the table again on jcpenney. >> i think you can hold jcpenney into earnings. >> walgreens, wba makes another 52. >> josh brown, quick? >> cha looks great. >> that does it for us. have a great rest of the day. "power lunch's" next. >> announcer: halftime's over. the second half of your trading day begins now. >> good afternoon, everyone. welcome to "power lunch." i'm tyler mathisen. goldman sachs says the chief u.s. strategist there says watch out below. he believes a serious pullback is imminent and he is naming a date. energy and utilities, both sectors really moving. how do you know when to get in and get out? and today, volatility during the earnings season. which sectors and stocks go up or down about this time of year? and a huge story today, three major plans to raise taxes in the united states in new york city and in the state of california. first, though let's check in

with sue at the new york stock exchange. hi sue. >> hi,ty. and an accelerated slide in oil prices dragging stocks lower right now. the dow is down about 97 points on the trading day. as you mentioned, goldman sachs u.s. equities strategy david costen explains why he thinks there could be an equity pullback next month. >> when we look at the data that has come out, we have for the last five weeks, the long positions are at an extreme. one of the highest extremes we've seen in a long time. and therefore, that would suggest that the u.s. equity market is likely to experience a pullback some time in the next four to six weeks. and that would be pretty consistent with the magnitude of an extreme reading we see in the commodities futures trading corporation data. >> so, is mr. kostin right? let's bring in jeff hussey global chief investment officer at russell investments. jim, i'll start with you. what do you think of mr.

kostin's comments? do you think indeed we see that extreme in the commodity futures and does that or tend a big pullback in equities? >> well sue, our shortest time horizon for investment is 12 months. so we don't spend a lot of time trying to make 12-week predictions. having said that we've been in a period without a lot of volatility. you typically have a 5% correction every 3 1/2 months. so if history repeats itself that would tell you march/april time frame, we could have a pullback. be very typical of that. >> jeff do you agree with that? and what do you think of the volatility that has suddenly returned to the market after such a long long period of time, when we didn't have much volatility? >> we would agree with that. in fact, right now, our portfolios are generally neutral. we're expecting a bit of a pullback as well and looking to get a little bit more constructive on equities. you have seen it in high-yield names, the energy names cams out today that the pricing reflects

a 6% default rate within the energy sector. so i would say that prices are starting to reflect it. we're looking for a little bit of a bottom and obviously some clarity with the ecb this month, with fed this month, and greece elections and a couple other key points over the month here. >> all right. jim, tell me what you want to do in this market if volatility is back, do you still overweight u.s. equities or look elsewhere? >> we are, sue. we think that the u.s. is the best position in the last quarter, we've moved some of our recommended taxable weighting back to the u.s. from europe japan, and the emerging markets. so we are not as positioned for risk as we were a year ago, but still overweight the u.s. overweight u.s. high yield, and underweight international and emerging market equities. >> jeff, you know everybody's talking about the benefits of these lower oil prices but there are some out there who are saying it looks a little bit deflationary. do you worry about that or agree with that? >> sure we do worry about it.

on net, it could be a zero sum game for the world. but obviously, there are winners and losers within that. and we saw payrolls obviously, people are concerned about average hourly earnings. we'll be looking at employment cost index near the end of the month here and some other dpaunlggauges to make sure it's good disinflation as opposed to bad disinflation. >> thank you, gentleman. we have some breaking news right now. let's go to rick santelli in chicago because it's an auction week. we start out with the three-year note. >> we do and it's an early one, because settlements is the 15th. to $24 billion three-year notes auctioned off minutes ago. the yield, 0.926, which is well below where the wi was trading, 0.935, trading 93.5 basis points. we give this one an a minus. not only was the priceing aggressive, but $3.33 of investor money chasing every dollar's worth of the securities available. 3.33 is better than the ten

auction average of 3.28. 45.8 on indirect best since june of 2010. the only light accounting for that minus and the a minus, direct's at 14.8 we're a little bit light. but a great way to start off the auction. of course, tomorrow we'll be looking at 21 billion tens versus wednesday's 13 billion 30s. tyler, back to you. >> all right, rick thank you very much. oil continues to plummet. 5 1/2-year lows yet again, we keep saying it. goldman sachs now slashing its three-year forecast, get this to $41 a barrel. we're not far above it right now, but goldman says west texas crude will near to stay near $40 for most of the first half of the year before shale investment in the u.s. is cut and the market rebalances supply and demand. let's go to dominique chu now for a quick market flash. >> so tyler, the energy right now, the weakest sector overall in the s&p 500. it's down over 10% over just the past three months here. you can see, they are down about

2 3/4 of a percent today. leading the way, new exploration, denbury resources, noble energy all moving to the downside. a very tough day and this has been a slide that started way back in june of last year. back over to you. >> dominick, thank you very much. staying with energy chesapeake shares taking a hit today, this despite an upgrade from goldman sachs. there you see the shares down about 50 cent or a little more than 2.5%. goldman raising the oil and nat gas company from buy to neutral with new management there. chesapeake shares down about 8.5% so far in 2015. meantime stocks of course also a bit of a bumpy start so far this year but the utility average, it's the only one in the green of the major indexes for 2015. and the index is up nearly 30% from 2014. there you see it. up, as uhyou see, 30.25.

how much higher can these stocks go? can utilities pull off another big year? morgan brennan's here and have been looking into it. what have you got? >> just to go off of what you said, take a look these are the gains for the dow utilities in 2014. vastly outperformed the dow industrials and the s&p 500. so far this year we're also seeing outperformance relative to the broader markets. but the question now, utilities, will they be the darlings of 2015? to answer that let's first look at why utilities have rallied. so these are income-producing safe haven stocks that in many cases have very limited exposure overseas. and those high dividends means they benefit from low treasury yields. you can see that inverse relationship right there in this chart. with the ten-year note yielding about 10%, these stocks are very attractive. and as long as the u.s. economy keeps gaining steam, utilities could benefit. however, many experts do think

that utilities could be near the end of their run. so morgan stanley just downgraded regulated utilities to cautious this morning. and with the fed funds rate expected to begin rising mid-year, that could pressure this sector as well. plus many of these stocks are starting to look expensive, or at least fairly valued especially wlu take the streets expectation for first quarter earnings decline into account. that said, are there still names to check out? yes, there are. so here are some of them. you've got pg&e is one name to check out. it's gotten two analyst upgrades in just the past week. another one to check out is dynegy and next era energy. both of these stocks according to fact set, have a price target that implies a 30% upside over the next 12 months. also, nrg, which just got an upgrade from credit suisse. these are a few of the names to potentially check out, no matter what the utilities do. >> thank you morgan very much. let's go to washington now.

eamon javers now with an update on a story he brought us a few minutes ago. more breaking news. >> that's right, sue. we're monitor right now an apparent hacking attack against the @centcom twitter presence, that's the official twitter presence of central command. the u.s. combatant command that's responsible for middle east as well as other parts of the world. that twitter handle has apparently been hacked by isis or isis supporters or isis wannabes. it has been spewing isis propaganda here now for a little while, including some documents that give the indication or appearance of being internal documents. not clear if they are internal documents at all or simply things that were available on the web for whoever this hacker is to scoop up and use as part of this that might have been in the public domain from think tanks. and we're also learning that the centcom youtube channel has also hacked by this apparently same group of hackers, also putting up some isis-related propaganda and videos all of that now an embarrassing pr

problem for the pentagon and for central demandcommand. not clear if there's any significant damage as a result of this hacking attack right now, but something we're monitoring and something the pentagon's monitoring as well. >> you know eamon, the timing of this, though is so interesting, because this comes at the time when the cybersecurity conference is going on and president obama has some initiatives out on that and he's going to be speaking. you just got to wonder whether this was coordinated or aimed at this particular event. >> yeah obviously, all of these are hugely sensitive issues sue. we saw the president speaking at the federal trade commission earlier today talking about cybersecurity and some of the things the federal government can do to protect people's identity online let alone centcom. obviously, what we saw in paris last week and over the weekend with islamic-related terrorism and isis-related terrorist attacks there, this is such a sensitive topic around the world right now. and then not to mention, the sony hack and the damage that was done to a u.s. economy or a

u.s. subsidiary of a company in that attack. all of these, very sensitive issues domestically internationally, and for corporate america. >> thank you so much eamon, appreciate it. the world's biggest automakers in detroit, a lot of them are making news. gm making a bigger bet on electric. they're unveiling a new all-electric concept car called the volt. our phil lebeau spoke exclusively about ceo mary barra about gm's push into electric. >> this is an area that we place high priority on. we'll continue to do so and we'll put all of general motors' innovative thinking and expertise into it to make sure we lead. >> can you make 30,000 stick? >> you know it's a concept vehicle, but if it's going to fit the equation that customers are looking for, yes, that's what we're going to do. >> reporter: and how much of the 200-mile-range, do you look in the future and say, we can extend it even further, where for right now, that's as comfortable as your engineers are. >> well, again, we're continually working. we have a great battery

partners, lg being one of them. we'll continue to look and advance the technology. i think you'll see with both the volt and concept vehicle and the new volt we've really added a lot of technical expertise and development. so we'll continue to do that. >> and gm's move comes as prices at the pump continue to drop. the average price for a gallon of gas in the u.s. now stands at $2.16. meantime, brian sullivan is on his way to western canada now to report on how this oil shock is impacting the energy industry up there, an area that you probably know provides a good chunk of fuel to the u.s. so watch for that wednesday on cnbc. so let's head back out to phil at the auto show in detroit. he's joined by the head of volkswagen america, first on cnbc. over to you, phil. >> reporter: thank you very much, sue. i'm joined by michael horn. and right behind us is the car of the year, which for a lot of people, the significance of that cannot be overstated, correct, with the golf?

>> we are really excited. and after golf has been introduced middle of last year with the gti, we've won already ten great accolades including motor car of the year and now north american car of the year here at the detroit motor show is the icing on the cake and we are really excited and it's great proof that we're in the right way. >> let's talk about sales. because everybody knows that you've had a rough year. sales down 10% in a market where sales have been up. have you bottomed out, though? have you looked at it and said we can build from here? >> if you look at the market and say it's a predominantly suv and pickup sector not so much sedans, but the last three months, we're up 5%. that's the telling story that with the introduction of the golf as well as the general facelift to the jetta, we are now back on the right track. >> meanwhile, you talk about demand for suvs surging in the u.s. you will have the cross-cut gte built in chattanooga, which will be coming to the market late next year.

by then do you think you can still make a sizable dent within that suv market here in the u.s.? >> i think with the next suv generations, plural -- >> reporter: not just the one you're in? >> it's the mid-sized suv three-row, which we will build in chattanooga, the cross-fit gte is another derivative, a possibility, two-row capacity which we think about doing later in the life cycle, but also exciting news is that the next compact suv, also three-row. the tiguan successor will be build to the north american market. >> can you still hit a million for 2015 for volkswagen group here north america? >> i'm confident we will. >> michael horn ceo of volkswagen here in the u.s. where they win car of the year with the golf and introduce an suv that will be coming here late next year. tyler, back to you. >> phil, thank you very much. many parts of the u.s. getting slammed with some very rough winter weather. severe in some parts. so how bad might it get? plus watching the major

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welcome back to "power lunch." check out shares of american

airlines. the stock has moved lower about 4.5% after the carrier reported a decline in revenue per available passenger, research per mile in december. that's a key industry measure of traffic overall for airlines. american shares again, down by about 4% now. it is, though up about 70% over the course of the past year so sue, down day-to-day but still falling oil prices helping some of those airlines out. back over to you. >> and falling temperatures next on the list. much of the northeast and the midwest hit by some nasty weather this morning. this video coming in from western michigan where they got pounded with snow and wind and cold. and today's forecast calls for more snow and temperature in the teens. upstate new york seeing tough conditions as well. crews on the road struggling to keep up with heavy snow. authorities are urging drivers to stay off the roads unless they absolutely have to travel. that is nasty, ty. >> it really is. we had icing out where i live this morning. very slick and slippery on sidewalks and roads there. we are keeping a close eye, meantime, on some of the major

agricultural commodities. corn and soybean prices under pressure on the back of the latest u.s. crop report. jane wells is out in los angeles, following the details for us. hi, jane. >> reporter: hi, tyler. weather's beautiful out here just saying. i'd sum up the report today with corn soybeans and wheat, more now and more later, though not as much as expected in some cases. beans getting hit the hardest, down over 2% after news that the record harvest of 2014 was even larger than analysts predicted. the increase in exports can not make up for higher yields. now, as for corn different story. despite cuts to corn production we still had a record year and we'll have another one this year. though the estimated 14.2 billion bushels now is less than analysts expected and the ending stocks will be much less than expected. so the average price has been raised 15 cents a bushel to between $3.35 and $3.95, down $3.00 in two years. so lower than suspected supplies and slightly higher prices has pushed corn up.

as for wheat, farmers have slashed their plantings more than expected to about 40 million acres. that's down almost 5%. yet, global wheat production is expected to hit an even bigger record high this year, led by better weather in ethiopia. so what does this mean for meat prices? because all this stuff goes to feed cows and pigs and i for one will never be a vegetarian. we're still going to have fewer cattle being raised and produced though they'll weigh more yet prices for beef are going to go higher this quarter. and then they will start to fall in the second quarter. pork prices however, are coming down, with big litters of piglets. however, the cdc has found a strain of last year's deadly pig virus in one herd in minnesota. so, sue, stay tuned for that. >> absolutely. >> perhaps they have learned a whole lot about that virus over the last few years and can contain it better. >> let's hope that's the case indeed. jane, thank you very much. back to the still-developing story with eamon javers on centcom having its twitter feed

hacked. eamon, what more do we know? >> reporter: as of right now, sue, we know that jim miklaszewski has been talking to defense officials at the pentagon and they told him that neither the twitter or youtube counties that centcom operates are classified and take a look at some of these documents that have been posted and say there's no security threat from those documents right now. what they're saying is that this is embarrassing but not a security threat to the pentagon. a lot of the documents that have been posted there apparently were in the public domain. nonetheless, a little bit spooky to see that @centcom account hacked on twitter, with messages like, "american soldiers we are coming, watch your backs." >> absolutely incredibly disturbing and, i think, unnerving for average americans who really wonder how they got in there and why there's some material that's on that site. it's just a very disturbing story. >> reporter: and sue, when you talk about identity theft and individual privacy information, one of the documents that was posted on that twitter account,

which has now been deactivated or suspended, and we're efforting a comment right now from twitter, one of the documents that was posted on there was a list of retired army generals and some contact information for them. according to what jim miklaszewski has been able to find out so far, a lot of that contact information may have been out date a lot of it was publicly available anyway so therefore, not a particular threat. but again, a little bit ominous, anyway, to see that posted on the internet in such a hostile context. >> but once again, the comment from the department of defense is that it's embarrassing but it's not a security threat correct? no classified information? >> that's exactly right. these are public-facing accounts. these were designed to put out news about the events at centcom, accomplishments of centcom, that sort of thing. it's operated -- i assume it's operated by the pr team not by anybody with access to classified material. so they're saying at this point, nothing there that was

compromised, that's anything a danger. >> very interesting, developing story because a lot of extremists have been using social media to reach out and radicalize and things like that. we'll be watching that very closely. eamon, thanks so much. appreciate it. >> you bet. switch gears a little bit, taxes, taxes, taxes. the plan to help the middle class and what it means for the wealthy. new york mayor's bill de blasio revamping corporate taxes. plus, california is planning a sweeping tax overhaul to rake in billions. we'll talk about what's at stake. plus, get ready for earnings season, it's back. traders dealing with the most volatility in the stock market that we've seen in months. we have your step-by-step guide on how to play it in the weeks ahead with the dow now down 111 points. ♪ ♪ ♪ first impressions are important.

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retailer cut its guidance for the year citing a disappointing holiday season. shares there down by about 15%. and a different story for lululemon. it's trading higher by about 7% 8% now, after raising its current quarter guidance, crediting improving trends and strong holiday sales results. again, those shares up sue, by 8% on the day's trade. back over to you. >> dom, thank you very much. over in france they're bolstering security in sensitive areas across the country in the wake of deadly attacks in paris last week. 4,700 security forces are protecting more than 700 jewish schools. these pictures showing soldiers from france's national security alert system guarding a trade school in the heart of the city's tourist district. they're all hoping to resume life as normal. the democrats have a new plan to boost the middle class and you can read all about it on powerlunch.cnbc.com. john harwood joins us now live from washington with some of the details of that plan. hi john. >> hi sue. you know the debate over what

to do about stagnant middle class incomes is accelerating, both on the 26th presidential campaign and on capitol hill. president obama came out with a plan to make the first two years of community college free for everybody. today, chris van hollen the ranking democrat on the house budget committee came out with a plan to link worker pay to executive pay. >> if a corporation is doing well enough to give its executives big bonuses, it should be giving its employees a raise. it's very simple. no raise for workers, no corporate tax breaks for executive bonuses. >> now, specifically the van hollen democratic plan would do these following things. first of all it would say, if corporations claim a deduction for compensation in excess of $1 million, then its incentive compensation profit sharing, stock options, that sort of thing, the same sort of options have to be required to workers

and worker pay raises have to be linked to rises in productivity. secondly, it would provide a new $1,000-per-worker paycheck bonus tax credit for people earning under $100,000. how would it pay for those benefits? it would raise -- it would reduce tax deductions for people in the top 1% of income and it would also implement a new, what chris van hollen calls, a high roller financial market transaction tax. this is a popular idea among democrats. now, let's be clear. there is no chance that this plan is going to be enacted by the republican congress and signed by the president, but it's the beginning of a long-running dialogue on this subject. you can expect republicans to talk about things like cutting corporate tax rates, as part of a corporate tax reform as well as raising child tax credits and other things and putting money in the pockets of the middle class, guys. >> an interesting session on the hill john. thank you so much. appreciate it. and don't forget for much more on this story, head over to

powerlunch.cnbc.com. and just a note don't miss representative van hollen on "closing bell" at 4:00 p.m. eastern time right here on cnbc. ty up to you. time for the power rundown. we're going to talk taxes. new legislation being introduced from new york city to washington to the shores of california. so what could it mean for you and your money? let's talk about with harry stein, associate director of fiscal policy at the center for american progress and patrick gleason, director of state affairs for americans for tax reform. harry, let me begin with you and let's talk first about what john harwood just spoke about. and that is representative van hollen's proposal. do you like the bones of it? >> well i think we still need to see some of the details, but the bones are very good. you know, what he's really focused on is what the challenge for everybody. we've had some economic growth and that's been gad over the last few years, but most of that

has been going to people at the top. this is not a new problem. this is not a problem of barack obama's creation. it's a problem for the last four years or so. and i think the bones of this are very good. he's putting money in workers' paychecks, helping people keep more of the money they earn and what he's doing is focusing on -- he's not taking wealth from the people at the top, he's focusing the money on these enormous government subsidies that are delivered through the tax code and we don't think of them as government subsidies, but they are, and he wants to pare those back and help everybody. >> patrick i assume you come at this from a very different point of view. let me ask you to elaborate on it and more broadly ask the question, in representative van hollen's proposal he proposes tying executive incentive compensation by law, to the compensation of workers. should government be involved at that level in determining who gets paid how much? >> yeah well i would like to

start with why the proposal is dead on arrival in the house, which as john harwood said, and that has to go to a lot of the problems with the pay force, how congressman van hollen proposes to pay for this. let's start with the transaction tax, which he calls a high roller tax. this is anything but. it is not a tax on the rich. it's a tax on most americans. if you have a bank account, if you have an i.r.a. if you have a college savings plan you will pay this tax. you'll bear the burden of this tax. so this is not a tax on the rich or the wealthy. this is a tax on the vast majority of americans. so that's the first problem. the second problem is the other pay-fors, which are scaling back or eliminating various credits and deductions for upper income individuals and households as well as corporations. okay, we can have a conversation about that and i would go along with what congressman paul ryan has said. let's talk about these, let's put these on the table, but let's do so in the context of broad-based rate-lowering tax reform that would reduce rates for all people. let's have it in that context.

and also, if congressman van hollen's plan were implemented, which as john harwood said it will not be it would actually reduce the likelihood of getting broad-based tax reform done. because it would take away a lot of the pay-fors for doing that. so it's problematic in all those reasons, and it's for those reasons why it's a bad idea and dead on arrival. >> we have two more topics i want to cover. one is a proposal in new york city, where bill de blasio the mayor there, is targeting tax relief for small businesses and manufacturers, but to do it, he apparently proposes raising taxes from firms outside new york city, but doing business here. and then in california a plan to expand the tax base there by applying sales tax to things like legal works, internet usage, dry cleaning. it would lower, by contrast personal and corporate income taxes, as part of the bargain and also raise the minimum wage. i know that is a kind of dog's breakfast worth of stuff there, but patrick, your quick reaction

and then i'll turn back to harry. >> it's analogous to what's called the commuter tax, which applies to individual income. a lot of your viewer who is live in new york city and philadelphia and commute in from outside from connecticut or new jersey, they have to pay local taxes in philadelphia and new york. so this would be a corporate version. basically, a corporate commuter tax. the big issue with that is how much does that affect businesses' willingness to do business in new york. does it cause a depression in that pull that back? that's the big issue with that one. and the other one is you know, california and other states looking to increase taxes is higher taxes have led to dramatic migration from states. so adding higher taxes on to that you know, research has shown that to not be a good idea. >> harry, your thoughts on those two? >> my understanding of what's going on in new york is that mayor de blasio is harmonizing the city's corporate tax regime with the changes that have been made at the state level. and that's a reasonable thing to

do. now, the devil is in the details and we still need to see those. and the same in california where the issue seems to be broadening the sales tax to cover a wider array of goods and services. that might make sense. the thing to ask about both of these, but particularly when you're broadening the sales tax is, who is going to bear the burden of these taxes? and often times with state taxes and particularly the sales tax, the burden is a progressive tax, which means it's borne more by people at the bottom. now, maybe that's what you have to do at the state level, although it's not always. and so i think states need to think hard about who's paying their taxes. but that's also a reason why to bring it back to what congressman van hollen is talking about the federal level, why it's so important that the federal tax code be progressive and work for working people and help people keep more of their own money, because at the state level, they really are going to be paying quite a lot of taxes. >> we covered a lot in a little bit of time appreciate it. meantime dominick take it away. >> tyler, here's what we're

watching. shares of twitter now near their session lows right now, off by about a half a percent. this as that official twitter and youtube page of the u.s. central command were compromised by commuter hackers, claiming to be isis or related to isis in some way shape, or form. twitter shares, you can see, they're off by about a quarter of a percent near their session lows. they had been higher sue, earlier in the day. back over to you. >> and we're following that still-developing story very closely. thank you. let's take a look at naelts markets right now. comex gold is up as we see a loss of 110 points on the dow jones industrial average. we see big moves in platinum and palladium, better than $13 on palladium and $15 on platinum and a 1% gain in the silver market. copper, once again, continues to be the laggard. out to chicago once again, because we have that three-year note auction. let's find out what's been going on since we last talked to rick santelli. ricky? >> sue it kicked off another round of buying.

if you look at an intraday of a minus, that was the grade i gave it auction really pushed yields down several basis points. so we think, it's because many now think maybe the fed won't tighten. but look at 10s and even 30s. they rallied, pushing yields down as well. we have to pay attention to their auctions tomorrow and wednesday. but on foreign exchange, i'm not showing euros or yen. i'll show you the dollar versus canada. you see it there on the intraday, it's like a rocket ship. and it is on a bigger chart, pushed us to the best levels on the green back versus the loony in close to six years. sue, tyler, back to you. >> rick, thank you very much. we will bring you up to date on this very volatile market off to a bumpy start for 2015 so far. we'll have all the numbers and some analysis right after this. e financial noise financial noise

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welcome back to "power lunch." check out shares of caesar's entertainment. the stock is falling on reports that a group of hedge funds filed papers to push the casino company's largest operating unit into a bankruptcy insider to begin a planned restructuring of those shares. you can see caesars down by about 3% on today's trade. and now for more on the

action for what's happening in the markets, let's go down to the new york stock exchange. that's where bob pisani is standing by. >> energy and the metals market really weighing on the stock market today. take a look at the energy complex. we're at new multi-year lows and every time that happens, you know the drill. energy stocks like anadarko petroleum, noble, oil stocks like marathon and schlumberger all tend to decline. this is having an effect on the s&p earnings. i can't emphasize this enough. look on december 1st for energy the s&p, it was expected to be down 13% for the q1. today, it's now down 41%. that's a phenomenal drop in one month, we've seen a drop of more than 30 points in the energy expectations. so here's what the s&p 500, and this is the current quarter that we're in december 1st we thought earnings for the s&p overall would be up 8.6%. now it's down to 4.6%. that's a 4 percentage points difference in five weeks and almost all those 4 percentage

points is because of the decline in energy earnings expectations. that's why the market is upset here because it's having an outsized influence or energy is, on earnings overall. the metals complex is also hurting the market. copper's near a five-year low, nickel and zinc are down as well. and you can see the influence, sue, this is having on some of the metal stocks alcoa reporting today, they had a great run last year. they are up on the -- they're on the upside. tyler, back to you. >> roberto, thank you very much. federal reserve bank of atlanta president dennis lockhart making some headlines today and steve liesman has the highlights. >> we're watching this stuff really carefully. dennis lockhart saying he still thinks the fed should raise rates in mid-2015 and that economic momentum from last year should carry over into this year. but, lockhart, a centrist on the rate-setting federal market committee did say his position could be swayed if he loses confidence that inflation will move back towards the fed's 2% target. now, that's not his expectation. he thinks inflation will be noisy in the first half of this

year, because of those lower oil prices and it should tick upward in the second half. but lockhart's comments come after an unexpected decline in wages, reported by the government friday and with inflation expectations as measured by the treasury inflation-protected securities call them t.i.p.s. declines to some of their lowest levels on record. many fed observers think the issue of the fed hiking rates is at least up in the air for this year. charles evans even said he would prefer the fed not raise rates until 2016. that's not lockhart's view but he did say the fed should be patient in raising interest rates. between lower oil prices and the surprise decline in wages, markets back off expectations for rate hikes this year. the funds rate expected in december of 2015 falling below 50 basis points friday from 56 so more and more of the street sees just one, maybe two quarter-point hikes this year. the key now, whether lower oil prices start to show up in

non-oil prices. so-called core inflation. economists are also looking for a january 30th release of the employment cost index, to see if that confirms this decline in wages we got in december. that will come out the fourth quarter of this year. that will be a real sign as to whether or not we should look for declining wages in the broader economy. >> steve, thank you very much. sue, over to you. >>ty, it's been dubbed the woodstock of health care. it is the biggest investing event in the health care industry. it's underway in san francisco and that's where we find a very business meg terrell. she joins us now live. hi, meg. >> hi sue. we're joined by bluebird ceo, nick leshi. thanks for being here. >> thank you for having me. >> you've had a huge 2014 just seeing your stock rocket. now, maybe it would be helpful for our viewers if you could explain what the excitement is about. we're talking about gene therapy, essentially trying to cure diseases. >> that's right, megan. i think that's the key point,

that we're cure. that's a big word. it's almost setting dangerously high expectations, but that's always been the promise of gene therapy. the whole concept of gene therapy is that you have a gene that's broken and the technology that we use is to acquire the appropriate cells in the body and then give you back functioning copies of that gene. and so you're sort of treating the disease at its heart. the notion there is that if you can do that do it one time you can potential liqueur really deadly diseases terrible diseases. and that is the data that you just referenced. we had four patients recently we announced the data on where they have a deadly blood disorder, where you need transfusions to stay alive. and those transfusions, unfortunately, lead to a dramatically shortened life span. so very difficult disease. here if you can treat them up-front and treat them one time with a curative therapy that allows you to produce your own functioning blood in the case of this disease, then you can cure them. and indeed that's what we saw in those first four patients. within weeks, they were able to produce enough blood and stop getting those transfusions that ultimately, obviously, we need

more time we need to treat more patients that's a very important part but hopefully, we can dramatically transform their life. you're talking about an 18-year-old who had one view of the world, right, one view of what their life span might be. and now with gene therapy, we might be able to give them back what you and i perhaps would think was sort of a standard expectation of life. that is the promise and that's where gene therapy and bluebird in that context, that's where the excitement is. >> well now a lot of folks are asking about the next maybe a bigger potential disease sickle cell. when's the next data on sickle cell? >> we've already treated patients with sickle cell so we are awaiting the data and as we get into 2015 we'll start to share some of that data and our hope is the same a one-time cure of sickle cell. it's almost crazy to say, because that community is in such need and that's something that we're very excited about. now, we have to -- you can make all kinds of arguments scientifically and otherwise, so we have to clearly demonstrate that it indeed, can potential

ly ly cure. that's very exciting. one last thing, you're famous for your footwear. i want to show everybody your new blue shoes, for bluebird bio, which you've got on here. i don't know if we got a shot of those, but they're pretty fantastic. nick leschly, thank you so much. a big labor problem for baby boomers, that is next. and there's one number in the jobs report that remains near historic lows and it is especially troubling when it comes to manufacturing. we'll tell you what that number is and explain why in two minutes. what can your fidelity greenline do for you? just take a closer look. it works how you want to work. with a fidelity investment professional... or managing your investments on your own. helping you find new ways to plan for retirement. and save on taxes where you can. so you can invest in the life that you want today.

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welcome back to "power lunch." i'm john harwood in washington. the white house has just acknowledged that critics are right to criticize the administration for not having sent anyone higher than the rank of ambassador to france, to that

big anti-terror rally in paris yesterday. here's josh earnest. >> some have asked if the united states should have sent someone with a higher profile than the ambassador to france. and i think it's fair to say that we should have sent someone with a higher profile to be there. that said, there is no doubt that the american people and this administration stand foursquare behind our allies. >> now, for some reason the white house was not willing to say whether or not president obama actually considered going to the paris event yesterday. although josh earnest did say that the president, had circumstances been different, in terms of the location of the event and the time for advanced planning, would liked to have attended. that is not likely to quell the controversy. in fact, it might accelerate pinpoint. >> john harwood, thank you very much. it was quite a stirring scene, obviously, in paris yesterday with millions turning out. dominick chu now. market flash.

>> we're watching shares of core labs, off about 4.5% after the oil service lowered its fourth quarter guidance. you can see its effect on core labs in today's trade. >> thank you. worries about the falling price of oil dragging on stocks today. we're coming off of our worst levels, though. we're down only 79 points. telecom and health care really the only two in the green right now. "power lunch" is back right after this.

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almost 750,000 jobs have been added to u.s. payrolls over the past three months but the unemployment participation rate, a number everybody looks at closely, at least economists do remains near historic lows, 62.7%. when it comes to u.s. manufacturing, there may be even less to cheer. cnbc's special correspondent, scott cohn has been taking a look at and he joins us from san jose. hi, scott. >> hi, tyler. actually, an outfit called the information technology and innovation foundation has been doing the real work on this. they're a nonpartisan think tank that's based in washington. now, on the surface, it seems like there's a lot to get excited about in manufacturing.

u.s. factories added 16,000 jobs a month last year. that's up from the year before. and we've been talking about a rust belt rebound in states like ohio, the auto industry is back energy is booming, politicians, red and blue are talking about a manufacturing renaissance. well, don't buy it says this new study, which calls the idea of a renaissance a myth. >> if you look at just the last three years, you see, basically, very little growth in manufacturing output you see a big increase in the trade deficit in manufactured goods. that's not a sign of -- that's not a sign of renaissance. >> here's what he says the headline numbers do not show. even with the hiring in the last few years, we're still down 1 million manufacturing jobs since the recession began. and 15,000 plants closed. that trade deficit for manufactured goods, $458 billion. the study says government

statistics overstate the importance of computer manufacturing. take that away and durable goods production is actually down. and hiring in the auto industry has more to do with the big cuts a few years ago than true rebirth. >> what we worry about with this very sort of optimistic almost pollyannish view of renaissance for u.s. manufacturing is that it lets us off the hook to do the tough political things we have to do. >> things like reforming the tax code and government investment and research and job training. remember for all the talk about moving to a service or tech-based economy manufacturing still accounts for one in six private sector jobs. sue? >> scott great to see you. thank you so much. market's down about 90 points. we're back in just about two minutes' time. [container door opening] ♪ what makes it an suv is what you can get into it. ♪ [container door closing]

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welcome back to "power lunch." the dow is down 90 points. the last time it happened was june of 2013 when it logged eight straight triple digit moves in a row. leading the way lower, exxon, chevron, ibm, and goldman sachs, sue. back over to you. >> let's look at some of the other market indices. dom gave you the latest on the dow jones industrial average. well, the s&p is down about 0.75%, the same percentage loss

for the nasdaq. the russell is not doing as quite as poorly as the rest of the indices. the oil market is what everybody is watching down here and we've had pressure all the way across the board with almost a 5% move to the downside with west texas intermediate. >> those are major $2 moves for oil. that will do it for "power lunch". >> "street signs" starts now. american soldiers we are coming, watch your back. the words of an apparent security breach on u.s. central command as cyberterrorists take over a major government twitter account. hi everybody, much more on that developing story ahead. but mandy, new week new pain. >> let's take a look at those numbers for you. the dow is flirting with six days in a row of triple-digit moves. right now the dow is down by 93 points, but, folks, it could easily be triple digits again very shortly. we have not seen this kind of