tv Fast Money Halftime Report CNBC July 17, 2014 12:00pm-1:01pm EDT
time. >> yet every single strategist on our network when we ask them what could actually drive a pullback in stocks, they always point to geopolitical issues. that can turn on a dime. those situations can change so quickly. there's something that you just can't possibly predict. >> if you're just joining us, we are getting word from both boeing and malaysian airlines they've lost contact with a malaysian passenger jet. 295 people yoonboard, crashed nr the ukraine border. ra reuters first to report this. a long-range extended from amsterdam to kuala lumpur. told the white house is aware of reports, but obviously, the white house, malaysian airlines, boeing, all awaiting more information. michelle ka caruso-cabrera at the newsdesk, scott wapner, with us, the half you'd see at this
time. phil lebeau covering the aviation front. michelle, tell me if there'sing in i don't know that you might? >> i can give you more details what the ukrainian interior minister adviser is saying. appears he's talking somewhere. we are seeing flashes hit the wires. he's saying, things we already know. a passenger jet. that there were more than 280 people onboard. gives more details about where he thinks it happened. torres, the city of torres, on the ukrainian/russian border in an area that has been a subject of strife. the d d d donnets region, say the that the plane was shot down. we don't know in that's true at this point and not able to trust everything that's come out of the ukrainian government in the past. interfax, russian news agency, also saying it was shot down. again, another questionable source at this point. he's saying it was shot down at roughly 33,000 feet, or 10,000
meters. by beuke missile. seen a missile like that in that region, or that kind of a facility in that region in the last 24 hours as well. and once again, this is video that's been posted on youtube, purports to show the results of the crash. again, not verified by nbc news at this point. once again, we have seen, saw it immediately, immediate and sharp reaction in the markets, carl. at this point, a little comeback, though. that ten-year yield remains below 2.5%. >> and dow is down some 90 points, michelle. things getting a little more dramatic from an equities standpoint. s&p down 15 to 1966. gold is up almost $25 $13.24. the 6:00, largest gain in three months. >> sharp move. >> up 12%. last time vix up more than 12%, april 10th, up on 15%, and we remember the volatility they visited us in the springtime.
so we're keeping a close eye how the market responds to every incremental piece of information. >> and oil has risen as well by 1.5%. might about logical thing to see at this point, though not a h e intraday move. >> scott, a busy afternoon? >> on a day already die jefrting information that was affecting the market, whether it was the dramatic miss in housing starts, whether it was the news of those dramatic layoffs at microsoft. i thought our colleague kayla tausche made a good point several minutes ago when she said the market at least apparently appeared to be holding in there, no sooner did she say that, of course, then we saw the dow deteriorate a little bit closer towards a triple digit decline, but you guys have run tluch the asset classes that have seen the most dramatic moves thus far. oil had seen this several-day rout rout. oil breaking through $103. gold rising sharply. the vix sort of exploding to the
upside and then the ten year, which dipped down to 247 or so. so that's where the focus remains. and we're going to see as more developments come through to us via al of our sources and those of the greater nbc news operation, what the actual market does, if it continues to deteriorate, or, carl if it stabilizes a bit, absolutely. and this all has transpired after the -- right around the time that europe was closing, scott. so we really don't have european deign seese to give us a barometer of fear, at least for the moment. still awaiting a formal response from the white house, and the e washington. >> i'm told the president has been made aware of the situation, he a aboard air force one, taken off from andrews air force base heading to delaware for a short hop. the president scheduled to deliver remarks and attend an event surrounding
infrastructure, and later in the day scheduled to take part in fund-raising activities. see if those plans change. the national security staff aware of the situation, monitoring it and the president himself made aware of this. whether we get an official statement once he lands, whether they can shet more light on this. all they're saying is the president's been made aware of it. >> eamon, back to you shortly. eamon javers in washington. on the news line this afternoon, retired it general beary mccaffrey to talk about the situation. general, good morning to you. >> good morning to you. >> this is always a tough conversation, right? because we know so little and want to know so much. what do you think happened here? >> well, one thing we're aware of, at that height, it was not hit by what we call a manpan or a light handheld anti-aircraft missile, which there are a lot of in the region. so this was a cruise served wen,
guided, targeted with radar. this was a major, a deliberate strike, to get a giant aircraft at that altitude. i actually don't think this necessarily, beyond the tragedy of the loss of almost 300 people, is a signal of anything new. that's a violent region. they've got to stop flying commercial aircraft in the area. the russian separatists have shot down ukrainian national aircraft already. with missiles. so the region's deteriorating, but so far -- i hate to go out on a limb and say this, it doesn't portend to anything galactic in the region. we're not going to intervene. the europeans aren't going to intervene and it's probably unlikely that the russians will directly intervene across the border. >> that's an interesting statement. obviously, any region where a commercial jet is fearful to
tread is by desks a hot spot. right, general? it does change the equation whatsoever? >> well, i think it's -- it's a signal of an escalation. remember, when you get a region like the persian gulf, we had a u.s. navy cruiser shot down in israelen, commercial aircraft under very complex combat conditions, where there were local enemy boats in the sea. see, you get into these areas, you've got to keep commercial aircraft out. there's just no question about it, but, again, i would suggest, this is an enduring and dangerous situation. mostly localized. again, we have -- u.s. has no military capability to intervene in that region. at present. and the europeans aren't going to. so, again, i don't think this is likely to become a wider
conflict outside eastern ukraine. >> we're waiting to hear what the president will say. obviously, the white house telling us he has been updated on the situation. would you expect a u.s. response, any different than we heard yesterday regarding sanctions? >> well, i do. you know, i'm actually probably more concerned about the pressure being put on primarily the u.s. the european are very reluctant partners to get engaged in the eastern ukraine. they don't have military capability. they're highly dependent on russian energy supplies. the germans are vacillating, to be honest, on their commitment to the eu, versus our economic interests with the russians. so i don't -- i am hopeful that the obama administration doesn't feel compelled to do something. this may be a time to stay quiet, learn what actually hatched, and then make a judicious decision. >> finally, general, i wonder,
we talk about these, these troubled spots around the world. we've mentioned gaza, we've mentioned baghdad, southern china and asia. where would you put ukraine in that spectrum, in that universe? >> pretty low. i think the danger, in the persian gulf, from iranian nuclear weapons development, from iranian shiite influence and iraq, syria and lebanon is a huge potential danger of regional conflict, and, of course, you know, we left out of our discussion now the north koreans where you've got essentially a barely immature sociopath running a nation with 8 to 12 nuclear weapons and desperate economic problems. so i think the ukraine is a sad statement of putin and russian territorial ambitions, which are historically understandable, but are a huge problem, to the
europeans. but i cannot imagine that the europeans or the u.s. will widen the conflict. and for that matter, i'm not too sure putin wants to get regular russian forces across the border. but this is going to be a mess for a long time. >> general, it's good to get your take on this this morning. we thank you so much. >> good to be with you, retired general barry mccaffrey, nbc news military analyst. also joining us, alan diehl, former ntsb investigators joining us on the phone. good morning to you. >> good morning, we've had discussion whether or not there is the capability on the ground to bring down a jet line frer this from this alleged altitude, 33,000 feet if e believe the ukraine interior minister adviser. can they do that? >> oh, yeah. obviously, somebody else earlierers this is probably not a hand-held heat-seeking missile. most likely a radar-guided
missile. we've seen this happen before, tragically. the u.s. navy shot down an iranian airliner similar to this. it was an airbus, flying over a war zone. planes are definitely as risk, passenger planes. it can happen, obviously, but almost certainly means we're talking about a radar-guided weapon. this is scary, because it means it may not be the act of an individual misguided russian or small group of russians. somebody had to have a major anti-aircraft missile system operational to do this. >> with that in mind what does it say to you, that not just malaysia, but any airline, was fly as route like this, amsterdam to kuala lumpur over this airspace and how wide is the radius now that commercial jets need to avoid? >> i said before and incidentally worked for the air force and ind investigated for
them. to answer your question, obviously, they need to be very cautious, and the other thing that's kind of scary here is the fact that there was a transponder problem with mh-370, one wonders if maybe there's not a transponder problem that occurred again, and we, you know, could have contributed to this? these radar-guided missile systems normally have the ability to read commercial transponders. so i'm not saying that happened. i'm simply saying, interesting coincidence, because this has every indication of being a radar-guided missile, and having look sd at those in the past, those kind of incidents, you wonder. okay? short answer, airliners need to be extremely cautious doing this, but they're not talking to the russians, of course, normally. they're talking to probably a euro-controlled air traffic control center, and not the russian military when they fly
through these zones. >> understood. finally, alan, if you lost -- theoretically, if, in fact, this was the work of some surface-to-air missile, is it likely you would be able to recover any evidence on the ground? would it be too disbursed and we're obviously already talking about a territory that is troubled? >> normally, if you hit an airliner way ground-to-air missile you'll find evidence of that, even if the wreckage burned. which reports talk about smoke coming from the wreckage, you'd expect that, thins is was on its way to kuala lumpur from amsterdam. short answer, yes, we should notice certainly waith matter of days or weeks at the very late effort. when i say, "we," somebody should. again, we've got this problem of a relatively small country, a troubled country, in the case of the ukraine, going to -- that's going to be in charge of this
investigation, under international civil aviation regulation 13. so this is getting to be a problem. now, we're -- i say developing, or smaller countries are thrust into the center of running a major investigation. hopefully they'll request help from the u.s. military, and/or the u.s. ntsb. >> alan, thank you very much. alan diehl joining us on the phone, former ntsb investigators. appreciate your time. we're going on 45 minutes now or so reports initially surfaced. ukrainian official saying a passenger jet, carrying 295 people shot down over a town in the eastern part of ukraine. malaysian airlines at the same time saying in fact it did lose contact with malaysian airlines flight 17 over ukrainian airspace. boeing airplanes tweeted, our thoughts and prayers are with those onboard malaysian 17, as well as their families and loved ones and stand ready to provide assistance. market took a tumble, down about
90 points at the session low. and now stands down about 60 points. s&p 1970, up a touch from the low of the day. scott wapner, michelle caruso-cabrera, scott you'll look at the market reaction? >> i am, carl, and would not be insensitive to the human side of the story with some 295 people onboard this plane, but, of course, looking through this, through the prism of the markets, that's what i'll do. we do see, joe tear norranova, market reacting as it typically does, israel, iraq a flashpoint pops up causing immediate market reaction as we're seeing here, it does stabilize once the news flow begins to stabilize and we wait to see what other developments happen? >> yes. you do see that. mike and i were just talking about it. mike used the word, it's almost eerie that's actually happening. when you look at the asset classes themselves, the first
place you have to look at would be the u.s. ten year, which is now below 2.5%. the yield curve that we talk about is now running close to 2. i think that's clearly problematic. the other thing which you and i have talked about, obviously the spot price of oil, scott, has risen $1.50, but energy equities, that's the leading sector to the down side. >> energy and industrials. already been having a rough day. >> right. so you're not getting the protection that i thought you would have had by owning those energy equities. that's not working for you are now. really, when you look at the situation, yes, the market's down that much, but you're seeking shelter. there's really no place that you could identify to do such, other than maybe treasurer rirs and the japanese yen. >> look at it's vix. the so-called fear gauge on wall street as we saw. a number of asset classes spiked to the up side you saw as fear enters the marketed on the unknown of this developing story. there's the cboe volatility, a spike of some 14%.
that's the story on the street at this hour. coming off the worse levels of the market but certainly continuing to watch the news flow to see whatever developments come forth. >> scott, thank you. look at the vix chart telling you all you need to know. people pointed out, today is the anniversary of twa flight 800, july 17, 1996. not that that has any connection with this particular episode but at the very least is an unbelievable convince den. michelle caruso-cabrera and hq on the breaking newsdesk, what else do we know? >> several updates. reuters reporting they have a correspondent on the scene in eastern ukraine that sees burning wreckage of an airplane and bodies on the ground. we pru zoom it is this jet. reports a fighter jet went down as well. a correspondent is on the scene in eastern ukrainish, seeing burning wreckage of an airplane and bodies on the ground.
next several tweets from key individuals we wanted to hear from in r in this situation. the prime minister of malaysia. i am shocked by reports an mh plane crashed. we are launching an immediate investigation. boeing tweeted out, our thoughts and prayers are with those onboard mh-17 as well as families and loved ones and stand ready to provide assistance. once again, a boeing 777 that went down. the white house press secretary, president obama, josh earnest, tweeted, the president has been breefrd directed his team to be in close touch on this matter. not in a position to confirm details therefore this report ux and the state department also tweeted out on reports of tragic malaysian plane crash, at this time the u.s. does not have any confirmation of cause, individuals on plane or any additional details. so once again, that's what we know at this point, but we're confirming they have somebody on the ground at the scene of a
plane wreckage at this point, and what will be clearly obvious from this report as well, there's going to be side stories written about, carl, has twitter has become a way to communicate with the world instantaneously rather than talking to dozens of news kororganizations as we cane that's happened. >> a tweet are from the state department spokesperson, on reports of tragic malaysian plane crash, at this time u.s. do not have any confirmation of cause, individuals on plane or any additional details. thanks, michelle. a quick break. dow's down 61 points. we'll stay on top of the story, when we come right back. but wh e of what you wanted to know? with fidelity's new active trader pro investing platform, the information that's important to you is all in one place, so finding more insight is easier. it's your idea powered by active trader pro. another way fidelity gives you a more powerful investing experience.
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ask your doctor about cialis for daily use and a free 30-tablet trial. welcome back. just joining us, stock market responding to reports of a passenger jet carrying 295 people, reportedly crashed. malaysian airlines saying it's lost contact with malaysian air 17. we've seen video of the crash, heard from boeing. the white house is awaiting further information. for more, to phil lebeau in chicago. >> a lot of speculation obviously about what happened and whether or not this plane was hit by some type of a missile and that shot it down.
again, unconfirmed reports out there. but we should point out that there was a report that michelle alluded to earlier, and now we're seeing from people who track the location of aircraft, that the last known contact with the plane was at 33,000 feet, bringing up the question, if that's the last known contact, if there had been some type of a mechanical failure or the plane went into a quick dive, there probably would have been more kbract it hit the ground. the fact they lost all contact at 393,000 feet obviously means something catastrophic happened at that altitude. a missile strike, possibly, but a number of other thing koss have happened as well. something to keep in mind. the other thing, carl, you are awe looted to this to the former ntsb investigator. why are commercial airplanes even flying in that space? they file flight plans in advance. that's been going on since this
conflict began. they were free of potential danger, belief, and that's why they were flying on that air route. clearly, some airlines choose not to fly that close to a conflict. that question will come up quite a bit, if in fact this is a case where the plane was shot down. >> thank you, phil. great point. people might want to know why that airspace is not completely clear. the white house saying the president directed senior u.s. officials to remain in close touch with u containian officials about the downed plane. bob pisani is here at post nine and can reconstruct how the market received some of the initial reports. >> rather incredulously. you must admit, malaysian airline down in the ukraine? one trader said, is this right? could it -- it looked like a surreal saidline. we're trying to confirm the facts. 11:00 a.m. eastern time when this came out. a lot of people have come to me, writ ton me, a modest response. remember something, the
assumption amongst everybody on the floor, this was an accident. who would want to shoot down a commercial airliner deliberately? however, i hope you heard carl's discussion with general mccaffrey, he postulated it may not have been an accident. it's all speculation, but a delicious act, that may be a totally different issue. moderate response. the assumption, accidental it wouldn't exacerbate russian/ukrainian tensions anymore. di deliberate jt a different color. you see the vix moving up. low a long time. this is a notable move up and we're just off the highs there. look at the ten year yield, and you can see the ten-year yield moving to the down side. important for the ten-year yield is other instruments that are bond-like moved in the option direction. i want to know -- gold immediately shot up. now off of its highs, but that was an easy area to look at.
moved the gold market up. one thing to look at, high yield. high yield bonds don't act like bonds in times of high volatility and crisis. they act like stocks. put up the hyg, the jnk, a high yield fund. a lot of money hiding in the high-yield funds. you see it moving down, jnk, heavy volume, the last couple days, a lot of volume. trust us on that. airline stork looiline stocks tf a hit. was this a deliberate, assuming it was shot down, deliberate or not? if it was a deliberate act, that's a different story. i think that's a much more severe story. >> however, i was amazed at the general, general mccaffrey's comment, even with all that, ukraine, in his view, doesn't simply remain a local story, compared to the other hot spots around the world, mentioned north korea in particular. pretty low on the spectrum. >> this is a general talking, a
soldier. i respect his opinion, but 300 people dying to me is a pretty notable event in an area like that. particularly ukraine and malaysian airline. those two headlines together, i think that's pretty significant. >> it is turning out to be an interesting test case on how the market receives geopolitical news after months and months of wondering when it would catch up to stocks. right? that's been the prevailing view on the floor. >> the opinion on the floor has been we can't believe the market is not broiled by events a little more than it has been. people are pointing out global markets are trying to move now towards the united states, and that heavy buying in the u.s. is the major factor. slowly improving u.s. economy. i think this is going to be a little test today. i really do want to know exactly what happened here, and who actually pulled the trigger? >> hopefully we'll get more information over the next few hours. continuing coverage of this story on cnbc in just a minute. ♪
crashed near the russia/ukraine border with some 294 people ongourd, apparently shot down. what have we learned, michelle caruso-cabrera. >> reports the shot down, but not from any credible sources. reports about it being shot down and whether, trying to find whether or not it truly has been shot down. the latest, a boeing 777, 200 extended range passenger jet with 280 onboard. 15 crew members. malaysian airlines tweeted they lost contact of mh-17, the flight, from amsterdam. last known position over ukrainian airspace and tweet more details to follow. boeing tweeted out, our thoughts and prayers are with those onboard mh-17 as well as their families and loved ones. we stand ready to provide assistance. and the prime minister of malaysia as well tweeted, i am shocked by reports an mh plane
crashed. we are launching an meet investigation. reuters reported they have a correspondent on the ground in eastern ukraine where they have seen burning wreckage of an airplane, bodies on the ground. we assume that it is the plane that we are talking about, but, remember, a fighter jet went down in this region as well, because this is in the region where there's been so much intense fighting between ukraine and russia. still waiting for confirmation that this is the passenger plane that they sap they are seeing. i have just been hand add statement, a media statement, from malaysian airlines saying it kemple kerms i confirms it information it lost contact with mh-17, 1415 gmplt gmt. central time in europe. approximately 50 kilometers from the russia/ukraine border. flight mh-17 operated on a boeing 777, departed amsterdam
at 12:15 in the afternoon amsterdam local time and ximted to arrive at koala lumpor the next day carrying 288 passengers 15 crew members onboard. from what we've gathered from various sources what was going on with this plane. we don't know why it went down. we have spoken with a reporter at jane's defense, an industry trade magazine dedicated to the defense industry, extremely well regarded. peter wellstead a guest we've had on cnbc before, deeply familiar with ukrainian military capability and russian military capability and remember, because aligned so long, it's similar capability. he says that it's highly unlikely a rebel force could have brought this plane down, because they don't necessarily have the capability to do so. it was flying at roughly 30,000 feet, we believe, that's quoting sources, who were on the ground
there. he says it would take a surface-to-air missile system. the s-300, for example, frequently referred to as s.a.m.s., that russia and ukraine has. russia benighing they had anything to doing with this. one of the rebels, separatist rebel, are blaming the ukrainian government at this point. that is not a source to be believed. at the same time, the ukrainian government is saying it was shot down. we don't necessarily believe them either. that's what we know at this point. waiting to see exactly what happened with this plane. why did it go down? back to you. >> michelle, appreciate that. with traders as well on the desk today including mike murphy, who you haven't heard from yet. at its lows, mike, the dow is down about 107 points. so it's come significantly off of that level. the ten year, maybe saw the more dramatic reaction going below 250. maybe 2.48% or thereabouts, as we speak. what do you think about as a
participant in this market as this story continues to develop? >> you see something like this, and once you get past the tragedy of it, you look at the market and the market's reaction. just in the last few day, scott, we've heard so many people talk about valuations and stretch valuations and bubbles, and an event like this, it can, a lot of times, be the cause for a big 2% sell-off in the market. that's exactly what you're not getting here. it's an orderly sell-off. i look at the s&p back above 1970. looks like the selling has been done. it looks like it wants to rally on this. >> dr. j, jon najarian here as well. make as good point. amid conversation over the last couple of days, certainly, that has gotten louder as to whether there are bubbles existent in the stock market. we heard conversation of that yesterday, doc, delivering al a alpha. what is to make, facing geopolitical stories and faced developments in the past, has
reacted rarp dramatically at times, at least initially on such stories. as i mentioned earlier, once the news flow stabilizes, somewhat, the market tends to come back and that appears to be what we're seeing here. the s&p is still down 10-plus points. >> yes, sir. we saw, what? a $12 move out of gold. that's not what you expect, the first site, mike describes a catalyst for people to run and hide. you would expect gold to make a $30, $40 move. nocht seeing that at all. oil making a 75 or 80 cent move. coming off of a vicious selling, and just getting back above 102. now it's popped up to 102.85, smk lyi something like that. not the reaction you expect, judge. and a rolloff yesterday. >> you can speak significantly to the vix. right in your wheelhouse, doc, the type of things you watch. we did see a significant move
higher in the jix vix? >> we did 1106 or thereabout. roald over to the contract. a lot of people, before anything on twitter, a lot of forkes buying upside calls for protection. of course, an inverse reaction as the market would go down, those looking for protection would buy vix calls. they did that this morning ahead of this. not smart money, or somebody playing this, but that protection is in place and now the vix is basically back to over 12. i'll be surprised if it holds 12. >> quick, you know, in incidents like this, what you do in the marketplace, step to the futures market immediately. if you take an intraday chart and look at volume. mike can see what i'm looking at here. on the lows you see a significant surge. risk managers sell futures. you don't get the follow. through you get a reaction throughout the day exactly what mike is talking about here. so i would caution people.
yes, there's a headline that's negative, but focus on the market. >> i would like to bring in phil lebeau. covie i covering boeing. what have we heard regarding this 777? >> nothing more than simply they are aware of the reports and looking into these reports. the focus right now for boeing as well as for malaysia and the air investigators will be the last exact point of contact, and we've seen reports that it was at 33,000 feet. which suggests a couple of things. one what catastrophic event happened at that altitude that would bring this plane down? was it a missile? or could it possibly have been something else? mechanical failure? no indication at this point we know dwefinitively what caused that last point of contact. that's what they'll focus on initially until they get investigators close to the scene for analysis of the wreckage and have a better sense, perhaps, what might have happened. at this point, hearing people
speculating. this plane was shot down. we don't know that for sure. we do no some type of catastrophic event at 33,000 feet. whether or not it was moan-made mechanical, a ia missile, nobod knows. >> on the phone line, bob francis, former vice chairman of the ntsb. mr. francis, welcome. good to talk to you. >> thank you. i'll do whatever i can to help you. >> no, i appreciate it. >> not sure where we are. >> i'd like you to give us insight in your experience how things will proceed from here from an investigatory standpoint. >> well, i think that -- i think that -- that the first thing will be the local people, if it's in ukraine. presumably the ukraine has some investigative capability. there certainly will be offers as there always are, from the
europeans and the u.s., and others, to assist in the investigation of a very sophisticated airplane. so i think you'll -- you'll probably -- it will be some time before anything is really known. i have no idea what the capabilities of the ukrainian government are, in terms of -- in terms of investigation, but i would imagine it's probably fairly limited. >> given the fact -- given the facts, sir, this is not a u.s. airline, apparently. how will that impact the participation of our own investigative agencies? >> it was a u.s. manufactured aircraft. so we will certainly have the interest and under iko on the provisions of international civil aviation organization, we have the right to participate in the accident, of our aircraft, as it were. >> wondering if you can help
answer a question asked multiple times this morning as to why a passenger airline would be flying through the airspace of what has been a war zone? >> you know, i had two thoughts, and that was the first one i had. and i thought, you know, here is another malaysian accident, and you really have to wonder if the aircraft was where it -- in other words if it was on its flight plan, whether the malaysian airline is capable of running an airline. i mean, why in the world, as you say, would somebody ever plan a route over one of the most contested areas in the world now? >> there are flashpoints, though, sir, all over this globe. have you known of cases in the past where passenger jets, wherever their origin, would fly through and over such an area?
>> i would be very surprised if they would. if a responsible airline if it were british airways, or japan airlines or whatever, if they had to do -- these aren't huge detours they have to do. i mean, you're not talking about a whole lot of geography here that they wouldn't have their pilots file a flight plan that would avoid that sensitive area. >> it remains one of many unanswered questions at this point. bob, thanks for speaking with us toye today. as we led to break, russian stocks are taking a big hit today. on these headlines, the fact of the matter is, however, this is a stock market under pressure of late. down at least a handful of days in a row. so it's been a tumultuous time in the russian stock market as well, but there's the current picture of the rsx, down nearly 6% today. up next, we'll speak to the
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ask your gastroenterologist about humira. virtually all your important legal matters in just minutes. now it's quicker and easier for you to start your business, protect your family, and launch your dreams. at legalzoom.com we put the law on your side. welcome back. we're continuing to follow the developing story of the crash of malaysia air flight 17. initial crusoe ka brar ra at newsdesk whip the latest. >> it appears president barack obama and president vladimir putin have spoken about the
situation. details here. reuters is reporting, kwoequoti the kremlin. vladimir putin told president obama a plane crashed in ukrainian taert. they held the pre-planned call, because, remember, just last night the united states imposed additional sanctions on russia, because of the situation in eastern ukraine. and during that conversation, information became available from air traffic controllers about the crash. now, reuters also reporting, they have a reporter on the -- air force one briefing reporters saying there had been a conversation between the two, but it was unclear whether or not it happened before the news of the downing of the passenger jet. during this conversation, according to the white house spokesperson, the president warned putin that there would be more sanctions on russia if they
did not help to calm the situation between ukraine and aush a russia and the border. we believe the two leaders have spoken. not clear exactly when. the kremlin saying it was president putin who told president obama about the situation's in now, what we show you on television here, fed to us by reuters. this is russian 24, one of the major news channel there's. they said this is similar to the video we were showing from youtube earlier, now from a better source, video of the wreckage, at least from the a distan distance. reuters say they go have a reporter on the ground who has scene the wreckage and seen bodies on the ground, but we haven't gotten more information at this point from that reporter on the ground. once again, 280 passengers onboard, 15 members of the crew as well for a total of 295 people, and still a lack of clarity about why this plane went down. guy, back to you. >> okay. michelle, thanks so much for that. let's bring in now the former u.s. ambassador to
russia, michael mcfaul. michael, welcome. it's going to speak to you. >> thank you. >> you left your post, mr. ambassador, in february, but clearly you're in tune with what's been happening there. your reaction to this developing story today? >> well, it's an awful tragedy, of course. it just is -- awful. clear, by the way, i mean, i should be careful here, on twitter, coming out of eastern ukraine, there are reports now that the commander of the rebels, this military intelligence officer, had name is igor strofcof claimed responsibility and said they mistook it as a ukrainian military cargo plane. >> i know you're trying to be careful, as you disseminate what you're seeing as well. i want to reiterate, all of this, of course, as it's being developed here has not been
confirmed by nbc news. >> correct. >> so that's an important distinction amid a lot of social media traffic, i might add. >> right. >> as this story has unfolded. >> and i'm glad you said that, but that he took responsibility for, and reminds your viewers that they've shot down two planes in the last couple of weeks already. in the exact same area of this conflict. so it stands to reason they would do this again. again, mistakenly. he said "mistakenly." >> right. >> obviously, he's assuming responsibility. >> well, on that point, i mean, if you're saying -- if it turns out to be a mistake is that even plausible? we've heard from general barry mr. clinton k-- mccaffrey this must have been a deliberate act? >> i don't want to speculate on that. i'm not an expert in terms of
that. mistake or not, it's a horrible tragedy caused by russian military intervention in eastern ukraine, and, you know, if not for that, this tragedy would not have happened. so i think mistake or not, the russians have totoday. >> and how will that happen? we know about the additional sanctions. we're told there has been a telephone conversation between president obama and mr. putin. what should happen now? what would be an appropriate u.s. response to something like this as a former ambassador who just recently left his post? >> well, i think the first response would be -- and -- to push them, to realize that this is going nowhere and call for a cease-fire and to engage in negotiation to end this conflict. if that doesn't work, there's no doubt there will be increased sanctions.
i think this will put a focus for the rest of the world on russia's military aggression. and if putin does not take those actions, there's no -- you know, you'll see what the administration calls sectoral sections, that is, sanctions on whole sections of the economy, not just individual entities like they did yesterday. >> sir, it's good to speak with you. michael mcfaul is the former u.s. ambassador to russia. we appreciate your time today. we'll be back after this short break.
we continue our breaking news here on cnbc, coverage of malaysia flight 17 from amsterdam to kuala lumpur, which has crashed in ukraine. joining us on the phone is an expert in eastern european investing, tim seymour, of course a "fast money" contributor as well. the u.s. stock market has largely come back from its lows. the dow is down more than 100 points initially. it has, as i mentioned, come almost all the way back. that cannot be said for the russian stock market to, which is certainly suffering today. the dollar is at the highs of the day against the ruble, which is suffering today as well. i guess this brings into question the pitfalls of investing in certain areas of the world where geopolitical flashpoints do exist. >> ultimately, i think russia had snapped back to a point where if you look at the index,
through part of last week, russia had pushed through some significant resistances, all emerging markets trading higher. russia was doing fine. russia even well before these events, well before the buildup over the weekend, which led to the sanctions of yesterday before the plane disaster today, russia had pulled back, you know, 5% or 6% and emerging markets hit 16-month highs yesterday. i think investors are able to discern where they see volatility in trouble spots, where they see trading opportunities, and where they see, you know, great fundamentals. and i think in the case of russia, what the rally back to above precrisis levels, if you look at -- pick a proxy you can trade in the united states, look at the rsx, replicating the russia local indices, and that even after today's pullback is up about 3% from prefebruary 28th levels when russia originally invaded ukraine. so, you know, russia was a trading opportunity, and
arguably is still trading above the levels that it was. but i don't think that investors feel they can run back into russia with two feet. if you look at trading volumes in this market over the last month and a half, they've been anemic. >> it does underscore, if nothing else, just the risks that continue to exist within the russian stock market, just given the news between russia and the ukraine. >> yeah. i think, scott, one of the ironies here is that putin has always fallen back on the ability to protect russian interests in a region, whether there was borders or not. and through the escalation of this event, there's so many unknown details, we're not going to necessarily speculate as to who has done what, but what i would say, though, is is that this is a case where suddenly this has gone outside the realm of just russian ukraine and regional interests. the irony is this will probably bring in western forces in a way
that putin never had intended, and that is something that to me is, you know, the biggest issue here. i think i would be most concerned that the u.s., which on some level acted unilaterally yesterday with sanctions, might have other things in store. >> i apologize for cutting you off. see you on "fast money" tonight.
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we start this hour with breaking news. this is the image from flight tracker, the website, showing the end, the disappearance from that website oaf malaysia flight 17 attempting to fly from amsterdam to kuala lumpur. you see the green line near the end of the russia/ukrainian border. there's a lot we don't know, but here is what we do know right now. the