MARIA-02
Showdown; Caterpillar Cuts 2016 View; FDNY Calendar of Heroes - Part 2>
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Michelle Martinez, Josephine Smith, Joseph Chiodi, Norman Bennett >
Business; Stock Markets; Economy; New York City>
We are watching General Electric shares this morning, the company reporting an adjusted profit of 21 cents a share, coming in just above analyst expectations. Now, overall revenue was above expectations as well, however, when you peel back the onion, the organic revenue actually declined one percent, and that is what is having a problem on the stock this morning.
It is down, as you can see there, and that's a Dow component. It will limit the Dow's gains.
Check the broader market average, meanwhile, because we were expecting a higher opening, but then GE came out, and it certainly did cut -- take some of the wind out of the sails. We're expecting a fractional move upwards this morning at the opening of trading for the Dow.
Candidates and voters getting ready for a showdown in the Republican Party. The RNC yesterday decided not to change the nomination rules ahead of July's convention.
Peter Barnes is standing by in West Hollywood, Florida this morning with the very latest after that meeting. Good morning to you, Peter.
PETER BARNES, CORRESPONDENT, FOX NEWS: Hey, good morning, Maria. Well, Republicans are getting back to work here after their meeting -- annual spring meeting here in Hollywood, Florida. But as you mentioned, yesterday, they decided to punt any decisions and any recommendations on changing the rules for this July's Republican Convention in Cleveland.
Now, as you know, there are lots of proposals out there floating around that could make it harder for certain candidates to win the nomination and make it easier for other ones to win the nomination. But Reince Priebus, the chairman of the Republican National Committee, said that he did not want the rules committee here yesterday to make any recommendations to change the rules, because the issues around them are right now so politically charged in this campaign that he just probably couldn't get anything done in an efficient and fair way.
So the rules committee decided to do nothing. Here's what one member said.
(BEGIN VIDEOTAPE)
RANDY EVANS, RNC RULES COMMITTEE MEMBER FROM GEORGIA: We shouldn't be changing the rules in the middle of the game. We've started with a set of rules. We've played into the seventh inning. We're now headed to the final stretch of the last two innings of the game. You really don't want to be changing the rules in the middle of the game.
And then second, any change we make will be viewed with a degree of cynicism. I think I mentioned that one of my colleagues had said if we had just changed a semicolon to a comma, there would be one of the three would be accusing of changing the rules to favor the other two candidates.
(END VIDEOTAPE)
BARNES: But this does not settle a lot of these contentious issues. All it does is delay the debate and discussion, because the rules committee will meet again the week before the convention begins in July to take up all these tough questions one more time and then kick it over to a separate committee that will actually -- for the convention that will actually decide what rules to adopt and recommend to the delegates. And at the end of the day, the delegates have to approve any changes in these controversial rules. Maria?
BARTIROMO: All right, Peter. This is becoming clearer as you speak. Peter, thank you. Peter Barnes joining us on those rules.
The race for 1,237 delegates rolls on as five more states prepare for their primaries next Tuesday. Now, as July draws near, the prospect of a Republican contested convention continues to grow.
There have been only eight since 1876, the last one happening in 1976 between President Ford and newcomer Ronald Reagan. What lessons can be learned from that 1976 convention?
Joining us right now is presidential historian and author of the new book, "Rightful Heritage: Franklin D. Roosevelt and the Land of America," Douglas Brinkley with us.
Douglas, good to see you. Thanks so much for join us.
DOUGLAS BRINKLEY, AUTHOR: Well, good morning.
BARTIROMO: Many believe that Ted Cruz's well organized ground game can be compared to that of Ronald Reagan's insurgence, that campaign of 1976. Do you agree? Do see similarities?
BRINKLEY: I do see similarities, the fact that they both did have a good ground game. But after all, Ronald Reagan had been a two-term governor of California, a well-known figure for decades. Ted Cruz is elected once from Texas and has really been barely known by the American population. So there's a big difference in name recognition there.
And secondly, that even though they had a good ground game, they ended up losing in Reagan's case to Gerald Ford. And you see Ted Cruz now millions of votes behind Donald Trump. So it's not always about the ground game. Personality, often in American history, will trump the ground games of candidates.
BARTIROMO: So what lessons should we be learning from that last contested convention then?
BRINKLEY: I think that who's got -- obviously, if Donald Trump has any kind of, you know, close to the amount of delegates he needs, let's say he's 20, 50 short, I think he will be the nominee.
Because in '76 the number two person, Ronald Reagan, couldn't take over Gerald Ford. The bad news is Ford lost in 1976. And I used to interview President Ford out at Rancho Mirage, California, and he never really forgave Ronald Reagan for putting that challenge on him at the convention. He felt that damaged him, you know, just months before the general election.
So the Cruz folks will have to be careful what they do if Trump has, you know, many, many more delegates. But they're trying to win on the technicality that Trump's a few delegates short.
DAGEN MCDOWELL, CONTRIBUTOR, FOX BUSINESS NETWORK: Doug, it's Dagen McDowell. So good to see you.
In terms of a winner coming out of a contested convention, and you can correct me if I'm wrong, but I think the last president to be elected to the highest office in the land that came out of a contested convention was FDR, was he not? So and he did --
BRINKLEY: Yes, 19 --
MCDOWELL: Go ahead.
BRINKLEY: Oh, you're correct. That's what I -- just my point being. It wasn't all the way until 1932 that you got a winner out of a contested convention. They're not very good for a party, because there's so much rancor that occurs, and the fight can get too ugly.
And unlike 1976 or 1932, we are living in a hyper-media environment where we're going to be having video streams, cell phone photos, Instagrams, watching everything under a spyglass. And I think that makes it even more important for the RNC to not have chaos coming out of Cleveland.
MCDOWELL: How do you prevent that?
BRINKLEY: I think you've got to -- you see Donald Trump trying to do it right now, trying to make himself seem presidential. Win, win these contests on Tuesday. Kill Cruz's win streak. Get as close as he can. Get as many delegates as you can.
But if you are just a few short, you'll turn Cruz into being the poor loser, the spoiler figure. And after all, Ronald Reagan in 1976, yes, he didn't beat Gerald Ford, but he came back four years later to win in 1980.
So you try to convince the Cruz crowd, go for it four years from now. Don't be the sore loser. Don't create chaos here in Cleveland.
BARTIROMO: Yes, that makes sense.
Doug, let me ask you, Donald Trump has been critical of Ted Cruz's tactics, saying this is not how the Republican Party should be. Watch this.
(BEGIN VIDEOTAPE)
DONALD TRUMP (R), PRESIDENTIAL CANDIDATE: I'm winning by millions and millions of votes, and we're fighting for delegates. And what they're doing is, take a look. I mean, they're traveling them around. They're taking them out to dinner.
You could actually take a couple of hundred million dollars and buy an election and never win a race, because all you have to do is, you know, take them out to dinner and send them to Paris, France, for the evening.
So I would say, honestly, I think it's a disgrace and that we should -- we should not be -- this is not our system, and this should not be the Republican Party.
(END VIDEOTAPE)
BARTIROMO: What do you think about that, Doug? Do you think Trump has a point?
BRINKLEY: I do think he has a point.
BARTIROMO: Yes.
BRINKLEY: But he's also then doubled down, and he covered himself by saying but the Democratic way of doing it's even worse than the bad Republican way, so it doesn't look like he's just beating up on fellow Republicans.
BARTIROMO: All right. Well, we'll be watching that.
Douglas, good to see you. Thanks so much for joining us.
BRINKLEY: Thank you.
BARTIROMO: Douglas Brinkley there.
Coming up next, New York's bravest heating up 2017. The heroes from the new Fire Department of New York calendar are here live, on set.
Then, nearly 15 years after the attacks on 9/11, questions still remain about who was involved in the terrorist plot which killed more than 3,000 Americans. Tune in for Fox News reporting, "Secrets of 9/11," hosted by Bill Hemmer, airing tomorrow at 8:00 and 11:00 p.m. Eastern right here on the Fox Business Network. A can't miss. Back in a moment.
(BEGIN VIDEOTAPE)
UNIDENTIFIED MALE: In another secret of 9/11, this FBI document, written just weeks after the attacks, withheld the name of a man who, quote, "In October 1992, hosted a party for Sheikh Omar Rahman." The Congressional joint inquiry into 9/11, however, names the party host.
UNIDENTIFIED FEMALE: Mr. Bosnan is named.
UNIDENTIFIED MALE: Osama Bosnan, a Saudi national, who eight years later, would be in San Diego. And according to investigators, a close associate of Omar Bayoumi. Yes, the very same man who signed the lease for the hijackers and threw them a party.
(END VIDEOTAPE)
(COMMERCIAL BREAK)
BARTIROMO: New developments this morning in the investigation into the 2012 terrorist attack in Benghazi, Libya. Cheryl Casone with that and the headlines now. Cheryl.
CHERYL CASONE, REPORTER, FOX BUSINESS REPORTER: Well, that's right, Maria. The State Department reportedly removed documents related to the Benghazi terror attack from the Secretary of State's office.
"Washington Free Beacon" reports that it happened after a congressional subpoena was issued. The move delayed the release of the files to the House Benghazi committee by more than a year.
Well, something new from Facebook. It will now support group calls for every user. To use it, you will need to update to the latest version of the Messenger app for the group-calling feature. Once you get it, all you have to do is tap on the phone icon in a group conversation. But Facebook messenger does not support group video chats yet, but you can use with it to have a little chat with everybody.
And finally this one. California cracking down on seat hogs and man- spreading on public transit systems.
BARTIROMO: Oh, god.
CASONE: Yes, serious. San Francisco's BART has adopted a one ticket, one- seat rule. Riders can be fined $100 if they use the seat for something other than sitting. A similar proposal is going to seen in L.A. in the coming weeks.
OK, so there's big campaigns, similar ones, here in New York, Philly, Seattle. The slogans? "Two seats, really?" And then my favorite, "Dude, stop the spread, please."
And now they've made it an ordinance in San Francisco. Power of the people, Maria. Back to you.
BARTIROMO: Yes, power to the people. Dagen, did you want to comment on that?
KEVIN KELLY, CHIEF EXECUTIVE OFFICER, RECON CAPITAL PARTNERS: I would just like to say that the seats are really small, OK? So let's not attack man- spreading.
MCDOWELL: From -- to all men on the subways, put your knees together and make room for the ladies so they can sit down.
KELLY: Yes, actually get off that seat, stand up and let a woman sit.
BARTIROMO: Yes.
JACK OTTER, JOURNALIST AND EDITOR, BARRONS.COM: Yes, just stand. I mean, that's what I do.
KELLY: Chivalry's not dead. Yes, yes.
BARTIROMO: Good idea.
(CROSSTALK)
MCDOWELL: Thank you.
BARTIROMO: Chivalry is not dead.
MCDOWELL: You'd be surprised at how many pregnant women are standing, and men won't get up and give their seats on the subway every day.
OTTER: Well, a friend of mine gave birth, was feeling a little better about herself. And then guys kept on standing up for her, and she was just like stop it already, OK? I gave birth.
(CROSSTALK)
BARTIROMO: All right, earnings alerts. We've got to talk about earnings - -
KELLY: Yes.
BARTIROMO: -- this morning, because we've got --
KELLY: Big time.
BARTIROMO: -- some big ones.
Shares of Caterpillar lower this morning. The company reported an adjusted profit of 67 cents a share, missing expectations. It beat on the top line, but really the issue here, I think, is guidance. They're lowering their guidance, Kevin Kelly.
KELLY: Yes, they are lowering guidance, and it is a tough market right now. And you start to look at what's happening in the industrial complex, this was actually seen in GE earnings as well.
So back in March, Caterpillar already guided down, and they took their sales and revenue down based off of what's happening. We're having slow global growth.
Maria actually interviewed Christine Lagarde from the IMF talking about global growth coming down to even being around the two-percent range. So that's what's happening. And you look at GE's earnings, they missed on the industrial side, and that's where they're pivoting to.
So they're going from home appliances and finance, and they're investing in the industrial complex, and it's not doing well for them. They bought Alstom from France. So you've got to be careful in this market, but these are great names that actually pay out dividends.
So over the long term, you know, they can fare well, especially when you start looking at duration risk on the bond side.
BARTIROMO: Well, the Caterpillar story has been in place for a while, Jack Otter. I mean, this is nothing new that Caterpillar has to lower its outlook again, as he just said.
KELLY: Again. Just in March --
BARTIROMO: Yes.
KELLY: -- they did it.
OTTER: Well, this is a commodities story. I mean, the mining equipment --
BARTIROMO: And a China story.
OTTER: -- why would you -- yes, exactly.
KEVIN: Yes.
OTTER: Why would you buy mining equipment when China is not using the iron ore or anything else that it used to use? Also, agriculture prices have been falling, because it's actually been pretty good crops. So they're not selling their stuff for as much, so they're not buying equipment.
On GE, I really think it's actually a very similar story. It's energy equipment. The industrial space is where they need to go. They need to stop being a financial company and start being an industrial company. And that transition is actually going fairly well.
BARTIROMO: They sold -- they sold GE Capital.
OTTER: Exactly, but --
KELLY: And we're talking about --
OTTER: -- they got hit on energy this hard.
KELLY: -- I mean, talking about growth rates, I mean, their organic growth, four percent. I mean, there's not a whole lot of growth, and these companies are fighting for it and each other. And we started looking at the other names that reported last night, you have --
BARTIROMO: IBM.
KELLY: Yet you had 17 percent of the NASDAQ 100 report in Google as well as Microsoft.
BARTIROMO: Microsoft.
KELLY: Right?
BARTIROMO: Yes.
KELLY: So you look at those names are down, because transitioning to the cloud, it's a lower margin business for them right now. They can raise rates later, so it impacted their margins, and shareholders weren't exactly thrilled about it.
But look at this -- those stocks over this year. They've done very well, and they've held up.
So they also -- if you look at Microsoft, you're getting a pretty good bargain and growth at a reasonable price, and it's giving a three-percent dividend in some of the hottest sectors in tech right now.
BARTIROMO: Did I see that Microsoft is up like 40 percent over the last year?
KELLY: That was Google.
BARTIROMO: Oh, Google.
KELLY: Google. So when you start to --
MCDOWELL: Year-to-date, Google and Microsoft were, essentially flat.
BARTIROMO: Microsoft, 29 percent.
KELLY: Yes, essentially flat, but if you look over the last --
BARTIROMO: The number is 29 percent on Microsoft. That is a nice return from Microsoft over the last year.
MCDOWELL: Yes.
KELLY: Yes, absolutely. And you -- think about what Google's doing.
BARTIROMO: And google, 46 percent.
KELLY: Yes, Google's in the three hottest sectors of the market right now that everybody's in, right? Mobile with Android, you're looking at streaming with YouTube and also cloud computing, and they won a big contract with Spotify.
So they're in the three hottest sectors. They could actually have earnings double over the next five years. So they're being more transparent where they brought in Ruth Porat. So Google's actually a pretty good name.
OTTER: Well, on the one hand, there's that incredible statistic that 85 cents of every dollar going forward in advertising is going to go to Google and Facebook. This is digital advertising, of course.
KELLY: Correct.
OTTER: And that -- Fox doesn't have to worry yet. But digital advertising, 85 cents of every dollar -- new dollar is going to go to either Google or Facebook. But I do think --
BARTIROMO: That's a big number. Wow.
OTTER: -- Google has to worry. I think Facebook is in the place that it wants to be, because apps, messaging, all the things that Google is doing but not as well as some other companies are where those ad dollars are going to go. And Google has to worry about this a little bit.
KELLY: Well, Google said actually on the earnings last night -- it was a fascinating stat. I brought this up earlier. A billion people have accessed their Chrome browser via mobile devices. That is unbelievable. And they --
BARTIROMO: That is.
KELLY: -- have the data that they need, right, because they've got Google Maps, you're looking at Chrome. This is another reason why Verizon could be bidding and win for Yahoo! --
BARTIROMO: For Yahoo!, yes.
KELLY: -- because they want the data and analytics, especially on the mobile side.
BARTIROMO: Yes.
KELLY: So it's a great space. You've got the leader, which is Google. Microsoft's fared well on the legacy side. As you said, Facebook, that's more on the social side. They are the only real true social network. And they've done well. They bought -- they bought Instagram for a billion dollars. Think about Marissa Mayer buying Tumblr for a billion.
BARTIROMO: Now, in retrospect, that looks like a bargain. Remember when they were talking about getting a deal --
(CROSSTALK)
BARTIROMO: -- and people said, oh, that's too expensive.
MCDOWELL: They've been able to monetize Instagram fabulously well.
BARTIROMO: Huge. All right, we'll take a short break. Up next, we are celebrating the men and women of the New York Fire Department. The annual FDNY calendar of heroes will come to life right here in the studio.
We will have the red hot fire fighters and EMTs strutting their stuff straight ahead. They're walking in right now. Back in a moment.
(COMMERCIAL BREAK)
BARTIROMO: Welcome back. By far my favorite segment in the program this morning, because when we are running out, they are running in. Yes, that is New York's bravest. They are turning up the heat this morning.
The Fire Department of New York releasing its annual calendar showing off some of the department's hottest heroes, but there's a surprise in store for the 2017 calendar. For the first time ever, the FDNY calendar will now include women EMTs and paramedics.
Joining me now are five of the featured firefighters and EMT, Esther Ford, Jackie-Michelle Martinez, Josephine Smith, Joseph Chiodi and Norman Bennett. Good to see you, everybody. Thank you so much for joining us.
(CROSSTALK)
BARTIROMO: Hey, congratulation on the calendar. How cool is that?
UNIDENTIFIED FEMALE: Really cool.
(CROSSTALK)
BARTIROMO: I love it. OK, so I want to start with the -- with the calendar obviously, and talk to you about this came about. But I also have to give you such kudos, because like I said, ever since 9/11 and watching you and your colleagues in action on 9/11, just humbled me and all of New York and the entire world. So a huge thank you. Thank you for your service.
(CROSSTALK)
BARTIROMO: How was doing this calendar? Let's talk, Esther, your experience.
ESTHER FORD, NEW YORK CITY EMT: So it was very exciting, especially knowing that we get to do this calendar supporting such an awesome foundation. The FDNY Foundation, you know, they go into communities and help educate people about, you know, CPR training and fire safety as well.
BARTIROMO: And Jackie-Michelle, I've actually emceed this foundation dinner in the past. I know you're having the next dinner. You're honoring Ken Langone, who's an incredible philanthropist. That's coming up in May.
JACKIE-MICHELLE MARTINEZ, NEW YORK CITY FIREFIGHTER: Yes.
BARTIROMO: This is an important foundation you're raising for, obviously, to help so many people.
MARTINEZ: Absolutely. The Fire Foundation not only helps the community, but it helps us as well as firefighters. It gives us certain education and grants, so we can get certain equipment to keep us safe. So the foundation not only helps the firefighters and EMS, it also helps the community.
BARTIROMO: And that's why we want to highlight it, because people need to understand how far the money goes --
MARTINEZ: Right.
BARTIROMO: -- when you raise money for this foundation.
Josephine, I really love your story, because you became a firefighter because your father passed on September 11th.
JOSEPHINE SMITH, NEW YORK CITY FIREFIGHTER: Correct.
BARTIROMO: Is that right?
SMITH: Yes.
BARTIROMO: Tell us about that. That was your motivation.
SMITH: Yes, well, I mean, I've always wanted to be a firefighter growing up, you know, as a little girl. I wanted to be everything like my father. So you know, unfortunately, he passed away in 9/11 and just gave me even more of a drive to, you know, fulfill my dreams following in my father's footsteps.
BARTIROMO: Oh, my god.
SMITH: Yes.
BARTIROMO: Condolences as well as our love to your family and to all of your families and really thank you.
Joseph, let's talk about your involvement in the calendar as well, and Norman. How was it?
JOSEPH CHIODI, NEW YORK CITY FIREFIGHTER: It was a great experience going through the photo shoots, meeting new people, meeting the girls, the guys. Not only EMS, women. It was a tremendous experience.
BARTIROMO: Have you had a big reaction from your friends? I mean, like when they see you've got those cut-up abs. I mean, I've been looking at these pictures, and it's like, wow.
CHIODI: Yes.
BARTIROMO: Sorry.
CHIODI: I mean, it's been great support from the family and friends and stuff like that. Of course, from some of your friends that you grew up with, the guys from the firehouse, it's been --
(CROSSTALK)
BARTIROMO: What do the guys at the firehouse say? OK, Norman, what do the guys from the firehouse say? Seriously, give it to us. What are your colleagues saying? Those who aren't in the calendar?
NORMAN BENNETT, NEW YORK CITY FIREFIGHTER: All I can say is what goes on in the firehouse stays in the firehouse.
(CROSSTALK)
BENNETT: But I will say they're having a good time.
BARTIROMO: Well, I mean, we're not allowed to show all the pictures, because you have got to buy the calendar so that they can raise money.
UNIDENTIFIED FEMALE: Right.
BARTIROMO: But I mean, I'm like wow, whoa! Whoa! Oh, my goodness. This is like -- oh, my goodness! This is like a -- you have to get this calendar. But it looks fantastic. And it's probably, obviously, not as hard as your day job. So was it nice to have a break to go vogue a couple of minutes?
UNIDENTIFIED FEMALE: Yes, absolutely. Absolutely.
(CROSSTALK)
UNIDENTIFIED FEMALE: Kudos to models, because it's not an easy job.
(CROSSTALK)
MARTINEZ: But, you know, just like in any profession, if you just try your best --
UNIDENTIFIED FEMALE: Yes.
MARTINEZ: -- you can achieve a lot of great things.
So like, for me, you know, the main reason why I did this calendar was because I wanted women in the five boroughs to see themselves and to know that they can accomplish so many great things. All you have to be is 17 and a half. You can sit down and take the fire test, and, you know, they could be a New York city firefighter. You know, they --
(CROSSTALK)
BARTIROMO: Amazing. Amazing.
MARTINEZ: -- can do everything we set our mind to.
UNIDENTIFIED FEMALE: Yes.
MARTINEZ: So, you know, it was empowering. And I said it's the first time that we're actually going to be featured along with EMS.
BARTIROMO: Wow.
MARTINEZ: It's a great thing how the fire department was so inclusive --
BARTIROMO: Amazing.
MARTINEZ: -- to include everyone. I said absolutely, I'm going to be in this. And, you know --
(COMMERCIAL BREAK)
BARTIROMO: Good Friday morning, everybody. Welcome back. I'm Maria Bartiromo. It is Friday, April 22nd. Your top stories right now at 8:00 a.m. on the East coast.
END
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