little bit and more supply coming in, but the builders just aren't building on the lower end of the market. they say they can't afford it with the cost of land, labor and materials being so high. >> a lot of fakctors there. diana ole eck join ugs that does it for the exchange. it's time to go visit tyler and melissa for "power lunch" which begins right now >> thank you we'll see you in a moment. new at 2:00, the s&p 500 up more than 2.5% in just three days nasdaq up 3.5% should you trust this rally? and problems mounting for boeing u.s. pilots apparent lit complained about the boeing 737 max 8 jet months before the o t ethiopia crash all the late etest details and liar education the fallout just starting for the college admission scandal. could it change the way kids apply and are admitted to college? "power lunch" starts right now >> welcome to "power lunch."

let's get you caught up on the markets right now. the industrials continue iing a very nice rally this week after last week's down week. 185 points higher right now at 25739. s&p up about 26 points about a fulper sel percent. and nasdaq up 77 points. >> let's get to bob. >> yeah, great start week. we are still holding up right near the highs i want to e show you a chart just take a look at this right now. we are finally breaching the 2800 level in the s&p 500. and we have a shot at getting over 2820. why is this important? because this is where five rallies have failed. i tried to circle them there those little circles in the last six months, five rallies, in october, november, early december, late february, early march, we got right to the doorstep here and failed so if we break above 2820, it

would drag in more investors other near term catalysts include industrial production and retail sales and yes sh we care a lot about that. earnings from adobe and broad com and or cal and finally, we've got the quadruple witching expiration tomorrow if quarterly expiration options and futures and maybe partly responsible for some of the little rise we're seeing here in the mid of the day fomc next week back to you. >> all right, thank you. it has been a rally this week. s&p 500 up more than 2.5% in just the past three days nasdaq up about 3.5% would have been more had it not been for the negative impact of boeing but jeff gunlock says the stock market was and is in a bear market and the stocks could go negative again in 2019 is he right or will we go higher

from here? let's bring in steve grasso, art hogan, gentlemen, great to have you. art, you say we're sort of range bound. >> yeah. feels like we're sort of the 27502800 level we've bounced off the 2813 four times and it's always been resistance it's hard to know that we've got much more gas in the tank until we find out about china trade and brexit and both we'll find out about, but it's just not going to be this month so as we look at the drivers for the market, yes, webb the government's reopened. if fed has pivoted we don't know the results of those two things that's what keeps us from entering the stratosphere right now. >> i feel like we are convening a meeting of a debbi downers here steve, i know you've been bearish for a while. is it more than just kept in a range in your view is there actually downside

>> no, it's funny, i was about to say you could probably speak for me on this i don't think first of all, a big fan of art always love being on with him. he's a consummate professional in the industry, always loved sharing the screen with him. i don't think there's any real catalyst or things that get exciteded about other than the market moving up so if i asked you what data points are we looking at, what would you tell me? the nfib is at a december 2016 low. lowest reading since then. you had a nonforeign payroll that really was a terrible payroll number to look at. and all the things that bounce, melissa, were just bouncing because the government close ended. so not really sure >> i'll play your reindeer game, steve, in terms of what i could throw at the market. things could be less bad europe could be less bad because we get a china trade deal and that helps europe. china could be less bad because of the stimulus that the chinese have started about five months ago can kick in because it usually takes six months

>> china's stimulus never goes away, so it's been going on longer than five months. it's over 60 in quantitiequantis we had that discussion the other night on fast money desk but u european stuff being less bad, we're just starting to get a whiff of how bad it really is. look at all the stimulus they've thrown at their marketplace in the nlast four or five years. what has it done the indices are at the exact same spot. germany, italy, france, japan, all of those economies are either on the brink of recession or in recession. so i think people are starting to realize that the panacea that global easing and fiscal stimulus used to supply is in the going to be the cure this time around. >> and there are a lot of structural problems in those european economies art, you know, i think of one thing that i've sort of drilled into my head over the years. that is this that slow growth as such is not

necessarily negative for the market slow, but steady profit growth for companies, pretty good a benign interest rate environment, pretty good for eck wiities. we've got all those now. zpl couldn't agree more. that has characterized this bull run we've seen for the last six years. it's been the slow and gradual rise in economic growth which never got much north of 2% earnings growth, except for last year, it's never been explosive. i think we're in the same environment. to melissa's point, you framed that very well if we get china trade right, that could stimulate the global economy, but we won't see that for a couple of quarters making those teariffs go away i going to be a better europe. all those things you said are correct. i just don't know if timing is the second half of this year or the first half of next year. >> go ahead, steve >> so art, let me jump in there. if you look at what's going on

with global trade, eve fn we get a china deal, the 40 trillion in debt stagnate productivity. growth just cascading lower. how on earth is a trade deal going to pull out their ageing population they have a deadline it's 2025. and i don't think 2025 for them being extremely positive i think they're saying hey, if we don't do it by 2025, it's lights out pr china. i don't look at it as a tail wind >> okay, so i should mention in passing here, all three indices are at session highs now but in terms of china, bank of america, merrill lynch, had an interesting note out this morning. we've been talking for months and weeks about em has been the most crowded trade and it still continues to be a crowded trade. tembedded in that is a bullish outlook for china. steve, do you think this area is a good short >> i would say that if you believe as i do that the china

trade getting done, if there's a deal getting done, is going to be one of the great sell the news events of all of our careers, i would believe that you should be shorting emerging markets on that back you've seen these incredible moves in china, large cap tech i think that would be a great place to start in short iing th moves. >> art, last word. >> on that emerging market trade, i'd be more concerned about the strength of the dollar i don't see what weakens that in the near term. not necessarily that china's not getting it right, i just think the strength of the dollar is hol it >> thank you coming up, the latest on the boeing 737 max 8 crash more countries grounded planes, but not the u.s. we'll hear from the flight attendant's group about why they want a temporary grounding and the college cheating scandal. we'll tell you what's happening to the hollywood act rescues involved and get a look inside

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space today. the faa in the u.s. u is not one. contessa >> they're sticking to it, but canada, big reversal, announcing that boeing can't find into, out of, over canada and the restriction's affecting not just the max 8, but the 9 as well the transport minister said he had full confidence in the canadian pilots and there have been no abnormalities reported, but he says he believes the data between those two deadly 737 max 8 crashes were just too similar. he was asked if he believe d th faa would follow suit. here's what he said. >> got this data this morning, analyzed it and made a decision. i can't tell you for sure if the faa has the data and but we are in touch with them and so they will know by now. and they have to make their own decisions about wla they feel that in comparing the flights,

whether that is a threshold point for them >> but at this point, it is just the united states, which is still allowing these boeing max 8s to fly. american and southwest continue to fly the max 8 publicly, they're standing behind the safety. the faa says it's confident in the plane's safety says look, we're just waiting on data from these black boxes, which by the way, are still sitting in ethiopia. it doesn't have the capability to get the information from the data recorders reportedly, they had asked germany to analyze, but they declined because it lacked the necessary software you know who they're not asking? they're not asking the united states that we know of boeing stock basically wow, it's basically flat on the day after a rough week the question everyone is asking at this point is will the faa ground these planes or just continue to stand ground that tair safe. you've got consumer reports. passenger safety groups that are

saying ground them >> smaller and smaller island that the faa is on right now >> but the people who know the planes, the pilots who fly them, i've spoken with insiders at boeing who work on them. they believe in the safety and the layers of redundancy instituted in these planes >> yeah, we're going to talk to some people who have some experience with those planes right this minute. the pressure is also coming though now from the rank and file of the airline industry the association of professional flight attendants, the union that represents crew members of u.s. carriers, is urging american airlines ceo, doug parker, to ground the 737 max 8 pending an investigation lori is the national president of the afpa and a former flight attendant with american. do you represent only the american flight attendants or other airlines as well that fly the max 8? >> yes, apfa represents only the american airlines flight

attendants and we're nearing 28,000 right now >> and you have gone to mr. parker, the head of that airline and asked they ground the flights and so far, no would your membership take labor action potentially and not get on those planes? >> you know, no labor action, but my members are becoming more concerned about the safety of this aircraft because as you know, there has been no final determination yet. >> right what about the pilots that you speak to or that your membership speaks to? we've had several on most of them say that they think the plane is safe. that they would know what to do in an emergency. we had one on yesterday who said i wouldn't be comfortable getting on the plane, but i'd be more comfortable getting on it and flying it than sitting on it >> our pilots are some of the most professional and well train ed in the world. we respect them greatly.

i do believe they will verve changing their mind if the situation merits though. >> and let's be clear. the association that represents the american pilots have come out and stand by the sift safety of the the max 8 i got to speak to the head this morning, dennis haguer and he specifically pointed out a very unique feature when it comes to the max 8 fleet. specifically for american airlines take a listen to this first. >> okay. >> our airlines and american airlines are unique because we have b additional indicate eors thats don't have >> so the american planes have two angle of attack displays one for each pilot and he says that makes them safer. why are you disputing what your own pilots are telling you >> there's so much information coming out and just as much that comes out positive is coming out negative i really think the big thing here is that we don't know exactly why that crash happened or how it happened an we need to have those answers.

the public and our members deserve those answers now. and i really do feel like over abundance of caution, it would be so much more prudent to ground those planes. >> why do you think the faa has held off unlike the other countries? >> i can't speak for the faa, i know that the united states has a very good safety record. i respect them however, it is concerning that so many countries are starting, especially when canada came on this morning, but the first concern for me is the u.k., singapore and australia. because they're also, their regulators are very well-known for a high safety record >> are any of your flight att attendapts saying they don't want to get on the aircraft or is there talk about some kind of strike basically >> no, no. there won't be a strike. but any flight attendant who does not feel safe or comfortable to fly, they're not forced to. they don't have to ch that's in

any situation. not just this one. >> lori, thank you very much thank you. >> my pleasure >> there are a lot of nervous fliers out there they're nervous about getting on a certain plane. they'll soon be able to search for the aircraft they want to fly on >> yeah, following the air crash on sunday, you saw the travel industry see strong demand from travelers demanding to understand what aircraft they are flying on. so r starting friday, kay yak.com is rolling out the ability for customers to filter by aircraft. for example, if you're looking to fly from new york to cancun, you would do the search. review your options then be able to see a number of filters including the original ones like take off and landing time and now, the type of aircraft you wish to travel on or exclude a spokesperson says they recently received a lot of feedback to make filters more granular in order to exclude more aircraft models by search queries, but that's not the only

option trip adviser enables you to identify by type and model though eck perts caution that the type of plane is always subject to change due to weather, maintenance or delays i'm sure we've been at a gate and due to maintenance or a flight being late, you have to squich gates and get put on a different plaep. so there's only so much power you really have. >> i wonder if they're capitalizing to an extent on this to differentiate themselves in the marketplace we talked about the google flight has made in the space just saying look, this is an opportunity for them to tweak that software quick ly to give the customer what they're looking for. >> absolutely. less than a week and they're rolling out a new feature, so certain certainly, these operators are trying to provide their customers more options and more of a customized experience beyond this boeing story, that's really a trend you're seeing across the industry. >> thank you nvidia was once one of the hottest stocks in the market, but lost more than a third of its value in the past six months the past week has been its best

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nvidia on a tear today and on track for its best week since august up around 12% since monday can this continue? mattally and stacy gilbert are your trading nation team today matt, nvidia up a lot in a short period of time however, still not much more than half its peek price from last week. where does that leave it in terms of the field position on your charts? >> well, it leaves it in a very critical position. up 900% in less than three years then gave up a third of its value in just three months when it stopped going down, it held right at it 200 week moving average. that's positive. then it kind of traded sideways for a while, through february. which formed a nice base for the stock. now it's starting a rally and is breaking back above a key level. it's neckline of inverse head and shoulders pattern.

it's only a slight break and a weekly pattern we want to see it close there. the key thing is with these lines, if they break above in a meaningful way, they shoot up, but that f they fail, they tend to roll oaf. this is a key level for the stock and this is a stock that's had a lot of momentum flowing out of the stock so if it can rally further anytime soon, that momentum is going to flow back in and be very positive for the stock. >> stacy, what if anything does the trading flow around this stock or the sector tell you about the prospects? >> yeah, i would say that in general, nvidia had two tail winds help iing it this week one is just the broader market risk on shift this week. particularly into large cap tech names. two was the announcement of the deal from nvidia when you think about the market is say, they like it chris rolin, our analyst who covers nvidia, also really likes the steel. sees this as highly -- when you

think about what they're bringing to the table, they have the potential to fill a revenue hole that's been lost since the crypt o collapse so overall, i would say from a fundamental per speck tiff perspective, we like it. from sentiment, we continue to see upside positioning the company has a meeting next week investors hoping maybe the management talks about the possible synergies of which chris sees as being eps upside president obama twif the synergies that could happen. so overall, white ill may not be our favorite name, it's a name we like to own >> the market has added much more market cap to nvidia than it's paying. matt and stacy, thank you very much for your time for more trading nation, head to our website. ahead on "power lunch," liars. new developments in the college admission scandal rocking the nation

plus, high-tech towables why shares of mauer jane producer are flying high today all this when "power lunch" returns.

welcome back, everyone i'm sue herera here's your cnbc news update gavin newsome is ening the death penalty in that state. the executive order announced today grants reprieves to 737 inmates awaiting execution that accounts for a quarter of the country's death row population the best city for women to work in is washington, d.c a survey by magnify money ranked 50 metro areas and found d.c.

had the highest percentage of managerial positions held by women as well as strong parental leave policies delegates from the international olympic committee toured stockholm today as they weigh if the city will be awarded the 2026 winter games. the city's plan calls for using existing buildings include iingn olympic stadium from the 1912 games. harp seal was set free by its rescuers in maine this morning after spending a month in a marine mammal recovery facility and he looks really happy. that is the news update this hour melissa, back to you >> thank you, sue. got about 90 minutes until the closing bell rings get a check on the rally as we'veseen all day, nasdaq the standout with technology the real leader here nasdaq up by 1%. s&p 500 up by almost 1%. 2817 is the level now so we're

holding a key level, 2015. the dow is up by about .6. we're watching shares of boeing with all the developments here boeing shares have been slightly lower all day on the session not nearly the drag on the dow as they have been for the past couple of days we are seeing that steep drop in the past couple of minutes down by one and three quarters percent. reuters just reported the u.s. is preparing to ground all go g boeing all max 8 planes, so we are seeing the stock react to that report right now. kelly. >> melissa, thanks very much keeping an eye on oil markets while we get more on this, seema has more >> wti cleaned up over 2% inch ing closer to $59 a barrel this is highest level wen sooef wti crude trade out since november of last year. this after weekly oil inventories fell more than wall street anticipatanticipated. take a look at brent crude it's trading to the upside

up 1.3% nearing the $68 mark guys, back to you. >> thank you very much let's get to contessa with more on boeing >> the president has just announced that he's going to issue an order to prohibit those max 8 jets the 737 max 8 jets in question now. from flying in the united states we saw headline come through from reuters that sources had said we were going to see those grounded and the united states has been under some pressure to follow suit from the rest of the world. dan just did a big about face earlier this morning about three hours ago. the transport minister said based on new information, he was switching gears and would ban all of those max 8s from flying into or out of the canadian air space. also the max 9, and we've just heard from the president that based on new information, he's going to issue an executive order to ground the planes throughout the united states as well >> all right i'll pick up contessa and let's

listen to what the president just said. >> we're going to be issuing an emergency order of prohibition to ground all flights of the 737 max 8 and the 737 max 9 and planes associated with that line i've spoken to secretary of transportation, acting administrator of the faa and to ceo of boeing. and they'll be available shortly after our conference today they are all in agreement with the action any plane currently many t lly will go to its destination and be grounded until further notice so planes in the air will be grounded if they're the 737 max will be grounded upon landing at the destination. pilots have been notified.

airlines have been all notified. airlines are agreeing with the safety of the american people and all people is our paramount concern. our hearts go out to all of those who lost love d ones to their friends, their families in both the ethiopian and lion crashes that involved the 737 max aircraft it's a terrible, terrible thing. boeing is an incredible company. they are working very, very hard right now and hopefully they'll very quickly come up with the answer, but until they do, the planes are grounded. and you'll be hearing from the faa directly in a little while i would say probably in 45 minutes from now, so you'll be prepared to hear they're going to go into great detail as to what they found,

where we're going, what we're doipg, but all those planes are grounded effective immediately okay this is a briefing that we've had planned for quite some time, some incredible people are with us >> continuing with his taped play there, but the key, the colonel there that the president has issued an executive order grounding the 737 max versions of that aircraft, the 800 and 900 versions of it until further notice we exto hear as he just said, from the faa and potentially boeing itself over the remaining part of this afternoon to get a little more. this will certainly, these planes are going to go to their destination, be parked there awaiting whatever fixes or changes in the software or other sort of flight instructions need to be done to make these planes safe it is going to cause a fair amount of disruption >> particularly through the system of southwest airlines,

which is the most dependent on that of all the merp >> to wait and wait then announce it in this very moment it takes effect means that now they're going to have to come up with contingency plans for all those people traveling on the flights that were scheduled. this wasn't said we're going to do this in 24 hours, airlines go make your plans, to wait then come out with it in this moment is going to create a little chaos might be too strong a word, but it's going create the disruption >> we're watching shares of southwest. tyler mentioned that 34 plane, max 8 planes i should say, specifically, in its fleet of max 8. 6% of total hours flied, flown, not flied, are flown on the max 8 and has for american, they've got 24 max 8 jet, 2.4% of hours flown are on max 8 jets. that's the impact in terms of the hours flown and we are watching the stocks move accordly on the back of this >> the other interesting thing about this and people will have to be careful. he's grounding the max 8s, the

9s there's another model, the max 7. we've talkeded about the max 8, the aircraft implicated in the two crashes. canada chose to also say no to the max 9. not clear to us immediately there are flying around, but that wasn't necessarily the focus prior to -- >> one other wrinkle there was the canadian transport minister he said based on inbound evidence he received that he said he had since shared with his american counterparts. i wonder whether that was the predicate that led to this >> also, there had been stories floating around that because of the administration's ties, its close ties to boeing, perhaps the involvement in the aircraft and purchase is of the aircraftn china trade deal, that the u.s. had been waiting to ground these planes he's really putting that to rest at this point in terms of the

ties with boeing and the role aircraft play in the china trade deal >> in term of a practical matter, because they had not planned on grounding these flights in the united states, you've not not only the max 8s taken out of service, but the max 9s leasing companies have planes available that the airlines could dpo to to fry to fill in some of the blanks norwegian says the it is bringing boeing dream liners to take passengers from providence, rhode island to stewart in dublin but the real question now is how many questions are b available to stopgap these 8400 just max 8s alone to say nothing of the max 9s now and whether the leasing companies get a run of these planes and whether there's enough to keep the airline's schedule running as it formally would. >> yeah, i think that's interesting here there's people now who were going to be trying to figure out whether the second leg of a trip they might have planned is actually going to happen obviously we have to just wait and see how qukly the airlines can respond. i'm sure they have some kind of

contingency plans and maybe they had firmed those up in the last day or two in case something like this happened, but they had stood by this until the moment trump just announced those aircraft are now grounded. >> so now, the next thing to work for the boeing statement. the response from the company. the company has been stalwart in terms of standing by the safety profile and to have now the u.s. ground these planes, this is a major development. in this entire story so we'll await to hear the statement from boeing at this hour >> one of the things the president said and i think i heard him correctly was that the airlines agree d it was time to do this and that boeing itself had assented this was good i think that is what he said kayla is in washington following the story for us what can you add >> i think the faa is going to add the most detail. the president said he expects them to make some xents in e detail in about 45 minutes time and he said that a few minutes

a ago, so we're expecting that press conference we assume it's going to happen, just after 2:00 p.m. to learn a little bit about what actually predicated this decision and why the u.s. made this decision when it did after all of the other nations where 737 max planes were being flown made this decision themselves. of course the decision comes as there had been a growing chorus of lawmakers on capitol hill growing slowly, albeit grow iin, to ground these planes out of an abundance of cautious. you had especially on the senate side, b more than half a dozen lawmakers saying this should be done including two republicans senator romney and ted cruz, say ing that this was the right thing to do. especially in light of what other nations were doing so we will see whether it was that pressure that led to this decision or whether it was in fact that data thatcanada may have provided. >> all right thank you very much. back to contessa brewer who has some numbers to put sharp rer points on this story >> we've just checked out flight

aware. right now, we can see six max 9 planes in the air. these would be the newer models and then 75 max 8s in the air over the united states so you're talking roughly quick math here, 81 airplanes currently in the air they're going to have to land somewhere and then as melissa and kelly pointed out, passengers will have to then find out how do they get to a final nation boeing is somewhat limited in how it can respond to this news because the crash of ooethiopia airlines flight is under investigation by regulation, boeing can't say a lot about the process or react a lot so even in terms of crisis communications, it's limited in how it can respond >> contessa, it's a good point a couple of interesting things the dream liner incident from a few years back, they had a

battery issue. grounded the fleet for a couple of months. not sure that's the best parallel here. they had to deal with it no fatalities. no crashes >> it's precall your attention kags >> joining us now on the cnbc "newsline" is alan deal, former ntsb crash inspector great to have you u phone in with us. are you surprised by this? by how long it took given all the other countries and all the other airlines around the world, they went ahead and grounded the plane. >> well, i was slightly surprised. i think there were a few things that happened. but first of all, we have to keep in mind that historically, the faa has had what they call a dual mandate to regulate and promote aviation and so i'ven though officially congress had told them forget about the promoting, in fact, they still you know, that's still part of their dna. so i think they were giving boeing every out if you will they didn't want to take the

action, but two things happened. particularly in the last couple of days. first of all, the ceo of ethiopian said the pilots had talked about a control problem not just a problem b when they wanted to return to, so this was a big red flag that certainly may have driven this decision on the part of faa and the airlines and the president then, too, we've learned of these other five complaints by pilots about the airworthyness and control system issues on the airplane, so both of those together i think led everybody to conclude, okay, it's time to put them on the ground >> i wonder, alan b, i don't want to put words in your mouth or connect dots that don't deserve to be connected. but i sensed in what you were saying there a moment ago, was that the faa might be a little more protective or give a home team kind of benefit of the doubt to boeing that they might

not give to a non u.s. aircraftmaker. did i, am i interpreting your thought correctly or not quite >> well, not exactly and of course, they also, you know u, we certify the faa, i useded to work at faa headquarters by the way as well as ntsb, but they certify the airbus, so i think, i don't know that i'd go that far to say this is specifically deals with the fact that boeing is an american company. these are aviation enthusiasts they try to do everything they can without violating safety for both the airlines and manufacturers. not just boeing. >> i remember years and years ago, i believe it was 1979 and kelly referenced the dream liner sort of grounding some years ago. 1979, the d.c. 10 which was a workhorse aircraft

there was one that went down out of o'hare. a friend of mine happened to be on the trailing flight and saw it go in and was -- if years on that. does this remind you of the grounding of the those d.c. 10s after that accident? i believe that had to do with something having to do with the third engine, which was on the tail >> no, actually you're talk about the american airlines that lost its left engine literally fell off the wing. two weeks later, the faa decided to ground all the d.c. 10s and incidentally, a lot of people attribute that to accelerating the demise of the dc 10 as a passenger aircraft of course that's got to be in the back of the mind of some of the bureaucrats. i'm a former civil servant that's got to be in the back of everybody's mind now this aircraft, the max, is a boeing's best seller this is not going to appreciably hurt the max long run.

i don't believe. but you know, they don't want to be too eager to overreact at headquarters i think what's driving them, but they remember the dc 10 crash in chicago and the dream liner's battery problems, they certify ed these airplanes and things went wrong >> all right >> i believe wiser heads prevailed and they decided let's just put them on the ground for now. >> i can understand not wanting to jump to conclusions especially when taking such a drastic step as grounding a model of an aircraft, but at the same time in talking about this most recent crash, it sort of struck me that i cannot believe we didn't really know the source of the lion air crash. that it had something to do with sensors being faulty, you know readings into the m kas system and that there was software fix. i didn't realize the fix hadn't gone into effect should we have looked harder at

this problem on the heels of the lion air crash know iing this one happen knowing we didn't know the exact cause, knowing there was a software fix that still needed to be installed. >> i got to be honest, i'm a former aircraft designer myself and you want b to be very, very careful when you're making changes and making fixes not only is there a large expense to doing that, you want to make absolutely sure this is the correct and best fix for the problem. so i think that's what's had been happening the faa headquarters folks and engineers are looking over the boeing designer's shoulders to make sure this is really going to fix the problem that was probably part of the delay. of course when the egypt, excuse me, the ethiopian airline occurred, that put everything back on the front burner and i'm sure accelerated the fixes. now part of the other fix is the

training, which i think both of these fixes are fairly straightforward. much simpler than saying say the problem with the dream liner the 787 problem where they had to come up with a new battery box to protect the batteries but this should be able to be implements within a matter of weeks or months at the most with the max. unlike the dream liner >> all right we're going to have to go here thank you so much for calling in former ntsb crash investigator we are watching shares of boeing very closely prior to today, some $30 billion in market cap had been wiped out of boeing's stock. right now, the shares are down another two and three quarters percent. this by a way is a six-week low for this stock boeing 365.13 is the lelev here. much more on this story on the other side of this break okay, paint a picture for me.

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bell ♪ boeing shares down 3%, taken the dow almost into negative territory, hanging on to a

30-point gain after president trump ordered the grounding of 737 max 8 and 9s in the u.s. effective immediately. >> it's tragic to all the people that we're talking about and we paid our highest respects to, but it's a very tough decision from the standpoint of a company like boeing, it's a great, great company with a track record that is so phenomenal and they want this solved. they want it solved quickly. they don't know the problem yet. they have to find the problem but they don't know the problem. it could be a lot of different things, so they have to find it and they willfind it the united states has the greatest record in the world of aviation and we want to keep it that way i didn't want to take any chances. we didn't have to make this decision today we could have delayed it maybe didn't have to make it at all. but i felt it was important both psychologically and a lot of other ways and again, working

with canada and other countries, we just felt it was the right thing to do. also, in speaking to boeing, and speaking to airlines, i spoke with american airlines, i spoke with a number of airlines and speaking to the airlines, i think that we all agree this was the right decision to make it didn't have to be made, but we thought it was right decision to be made so. >> let's get to contessa brewer for the latest. >> we're getting reaction in from boeing. boeing in consultation with the faa, the ntsb and customers has supported the actions to temporarily ground the 737 max operations it says it still has full confidence in the safety of the 737 max and now this part is key, but boeing has determined to recommend to the faa the temporary suspension of operations of the entire global fleet of 371 737 max aircraft coming from boeing airlines in response to the president's order to suspend these max 8 and

max 9s we also have a response now from american airlines, quote, earlier today the federal aviation administration informed us based on new information they're grounding the united states boeing 737 max be fleet out of an abundance of caution 24 aircraft affected by the directive and appreciate the faa's partnership and work closely with them. the department of national transportation safety board and other regulatory authorities and our aircraft and engine manufacturers. our teams will be working to rebook customers as quickly as possible and we apologize for any inconvenience. we are hearing from passengers booked on these flights and said as the president was announcing it their flights got canceled. >> thank you very much. contessa following this story. bring in jim hall, former ntsb chairman i believe it was monday on this program that you called for exactly what has happened today.

>> that's correct. >> and what does this action tell you or suggest to you may be the problem with this aircraft >> well, first, let me say, i regret that the boeing aircraft corporation, who put this aircraft into market and is responsible for the safety of the aircraft, and the federal aviation administration, whose main responsibility to the flying public and american taxpayers is to put safety first, failed to do so saying that, i'm pleased that the president has made the decision for them, the right decision, to ground this aircraft, and i think as this happens, as this has been done, it's an appropriate time to remember that 346 people, 346

souls, on two different aircraft, lost their lives >> that's absolutely true, and noted. let me tease out your thinking on why you say that boeing did not put the safety of its passengers and its customers first. what specifically causes you to say that >> well, boeing has had facts. they were in the process of trying to put a fix on the computer they acknowledge that themselves they get real time transmissions on most of their fleet all of the information that they needed to make this decision was in their board room in their executive office and they made the wrong call >> and so why would it take so long, i'm asking a naive question, jim, and i concede it, why would it take so long from the time of that first crash

involving the lion air aircraft to today five months later, to effect that kind of software change and get it on to these hundreds and hundreds of max version planes >> well, i do not know the facts on that, but my speculation would be because this is not a simple fix >> all right jim hall, thank you very much for your time again today. we appreciate your time earlier in this week and let the record show you called for exactly the action that was taken moments ago. >> joining us is jim, an analyst with cfra. you cover boeing >> yes, i covering boeing. >> so what does this move do for boeing's culpability, even potentially liability, as this plays out >> so i don't know that the faa or the president grounding the fleet changes anything with regards to culpability the facts are still coming out it's still days after the

ethiopian airline crash, so it's still very early to say. obviously the president seems to indicate that he has some facts the rest of us don't have in terms of what boeing knows or should have known. you have to give him the benefit of the doubt. >> people who following boeing say and have said for the last couple days when they're focusing on the future of this company, which is, you know, one of the oldest -- it's a pioneer, it's a juggernaut, they've said look, they have a software fix, they're going to get it out there, they're going to move on. why has that not happened yet? why has it taken this long again, will the finger be pointed at them for some kulpa snblts. >> it remains to be seen how this is going to play out. certainly there are many blaming boeing you saw jim hall speaking and saying they should have done better this is all going to come out over time. if you look at boeing, i've covered airlines since 2001 and there has never been a boeing crash that was solely the fault

of boeing before this is new ground for everyone. i think boeing has man amazing safety track records over decades they are doing all they can to get the software patch in place as quickly as possible and i expect the planes to be back in the air within weeks if not sooner hopefully there's a lot to be said for looking at the long-term track record of boeing and where the airline industry and the commercial aerospace industry is over the next ten years you're looking at an investment in the stock. people are afraid and a lot going on and a lot of news happening quickly. >> we have about 40 seconds, jim, but what kind of reserves does boeing have for liabilities? is that something we should be considering at this point? >> boeing has insurance. they have deep pockets in terms of a lot of cash they've got over $20 billion i believe on the balance sheet they've got the ability to access capital markets and they've got credit lines i think that in terms of your worrying about boeing as a growing concern i don't think that's a starter at all. >> we will leave it there.

thanks for phoning in. jim from cfra. strong buy rating of boeing on six-week lows on the back of the development. >> taking the three-day stretch to a 15% decline. >> "closing bell" will pick up the story right now. #. welcome, everyone to "closing bell. i'm sara eisen. >> i'm will frfred frost we will pick up with the breaking news. president trump ordering boeing 737 max 8 planes to be grounded. a live look at the flight tracker of 737s in the air right now. no new ones will be taking off some due to land we will talk to gordon bethune, that is coming up. let's get first of all to contessa brewer for an update on all the latest breaking news as it relate ts to boeing. >> today has been