Caterpillar Earnings Show It's No Butterfly

Aaron Task analyzes the morning business headlines.
7:10 | 04/22/13

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Transcript for Caterpillar Earnings Show It's No Butterfly
Market futures were up this morning ahead of more Q1 earnings reports. But one worry for the market could be the effect of the sequester cuts right now let's bring -- Aaron task from Yahoo! finance. To tell us more about the impact of the cuts and the top business headlines of the -- good morning Aaron. -- -- So let's start with the impact of the sequester we knew we weren't going to feel the cuts for awhile but now the Federal Aviation Administration says the furloughs are causing lots of delays at airports how bad is it. We'll bring -- Israeli anecdotally -- stories of people just saying you know things are just slow -- know a friend of Kenya through LaGuardia over the weekend said wow we just have to wait a long time DA clearance to land. I mean I think the bigger issue here is that the sequester cuts. Really are just only getting started -- a big concern because the economy has started to slow. As we started the second quarter and that's again before. Those cutbacks -- really start to take a bite out of economic activity. So you don't because -- -- case of the FAA trying to make it seem like a larger problem and it actually is just. Get that budget in place. -- you're so cynical why do you think nothing I would -- -- that I can't imagine. The agency the government would try to make take advantage of the situation. That's -- out you're absolutely right Aaron -- -- at all at face value -- -- we also -- investors are looking at more earnings reports out this morning futures were up but one of the bellwethers caterpillar. Not doing so great right. -- I disagree caterpillar of the the missing the first quarter result they also lowered couldn't -- significantly. Their forecast for the full year they're now looking at earnings of around seven dollars a share. For this year back in January they were they have a range of seven to nine dollars a share so they've really they've just -- two dollars of earnings often their forecast for the whole year. I'm and I don't think it's a shock to Caterpillar's numbers missing that forecast really -- -- people off guard and yet. The stock is actually doing okay today so you can make the argument that maybe this was not an unexpected negative. So -- can't read anything into like a decline in mining sadistic. But there's definitely decline in economic activity around the world -- caterpillar has already talked about before this earnings report. You know less demand for their head he. Earth moving equipment. From around the world you're seeing the selloff in commodities generally so that's gonna mean there's less -- -- from minors for that kind of equipment and so. Yeah I get you can't draw -- conclusion. That -- caterpillar is feeling the effects of the slowdown in the global economy for sure. Well you know speaking of mining on -- gold firm moments back in the news it seems to be. Climbing back up after that humble it -- in the last couple of weeks what's the story here. Well -- -- ago has been a fantastic investment for the last twelve years. Really so I think a lot of investors you they've awarded they've done well that or they've been watching -- and saying -- -- to get some of that so we have the kind of big sell off. We saw. Last week in the prior week before it. People say that's it that's an opportune -- -- -- because this this story -- for gold -- the rationale is that. -- the Federal Reserve another -- central banks around the world printing money like crazy. And that ultimately. There's gonna be big inflation problem and that -- -- gonna do really really well right so if you believe that then this is a great buying opportunity his gold has fallen. -- -- five foot plus percent from its highs. 2000 -- -- -- have to tell you I know. -- Smart people Smart investors who've done very very well for themselves. Who owned gold bars and keep them in places that they don't tell anyone and just think -- -- An idea. I -- Lee you know there there is value in -- and there's -- -- he's a long time for -- New York Stock Exchange always -- you and keep -- around you can -- the border -- In case things go really really badly but -- -- tell you that you -- the -- insurance policy. So you shouldn't have all your money in an insurance policy right and you should be happy if it doesn't chaos because the alternative is that things have gotten really really that threaten the -- you want -- there may -- five -- 10% of your portfolio but. People I think what some people were putting them all of their eggs in that one basket and that's never a good idea. Absolutely got to mix it around a little bit all right let's talk a little bit about apple the tech giant has fallen quite far. And tomorrow it's about to release its Q1 earnings reports what are investors expecting to see. Well investors are that expectations have gotten very very low for apple on this is -- huge this is -- really see change. I'm and this is what happens when your stock falls 40% pretty much a straight line gives AG -- -- -- really bad going on -- so there's a lot of concern about. By a falling margins profit margins and apple. And just overall that the sales trend the others -- new -- -- gadget on the horizon apple TV seems away away. -- sudden come out of the lower priced iPhone navy to make some inroads in China so. Again the expectations are really low for apple going into this quarter -- and it hasn't been that case in recent memory not not that I can remember for sure. So if the earnings report is less than par is it time for Tim Cook to go. You know there there actually is some chatter about that I think it's really really speculative at this point -- Tim Cook he was you know annoyed by Steve Jobs. He did a great job managing a transition he was actually running the company. In the last month's meeting last year's Steve Jobs is -- -- this is the guy who is you know as well -- In what what apple is what they're trying to view I think it's premature to say. That you know his job is at risk other everybody's -- always at risk right but I don't think anyone really bad quarters going to be enough. For there to be a serious discussion about whether -- job cuts he's -- Tim Cook is out of a job and I but again you know we -- it -- -- Ron Johnson and JC Penney who recently former album guy you know things things can change very quickly after. You know for months the -- saying we support Ron Johnson is where Johnson. Right Connecticut that Apple's media that's all I can -- ahead exactly. Bluntly congress is set to vote on an Internet tax bill this week but online retailers are pushing back even enlisting the support of their shoppers do you think. This is going to work. This is it really -- -- story because -- yet Amazon. Is joining the brick and mortar retailers in supporting this bill which would basically mean no more free shopping -- no more tax free shopping excuse me. On the Internet. And -- on their they're now building warehouse is all over the country much you have physical. Facility somewhere that you're supposed to -- Collective state taxes. So you have John Donahoe CEO -- -- which things are referring to you. They -- getting email all -- day users say hey tell your congressman you don't support this bill and and why would any of us say yes I support. In taxes on my online shopping but the reality is as were all supposed to be paying it ourselves right as individuals. Because the companies are collecting it and it was doing that so technically. Robbery in the law right now I'm you know I'm guilty of its youth so you know I I think -- this whole story is is interest thing -- do you think this and it's -- improve this bill. Comment in this theater to see -- what happens in the house and and doesn't become law. I do feel that twinge every time I'm make that online purchase that doesn't act I have to you do it is that most people don't disagree and -- the -- -- thank you. But out -- it I think most people may not even be aware that they're supposed to pay them -- You know all right -- before we let you go let's take one more look at the Dow right now and it looks like it's up. -- little bit but they're not so far Aaron task thank you so much thank you --

This transcript has been automatically generated and may not be 100% accurate.

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