tv Power Lunch CNBC November 3, 2017 1:00pm-3:00pm EDT
innovation >> oh, good lord last name weiss? >> i did read the e-mail dove tailing on my speech a little bit ago on financials, i think we should look at value still. >> no time for speeches. >> value is underperformed i think there's a lot of good stuff underpriced. that's it. >> we got to go. >> cut it out. >> sorry >> it's 1:00 >> done. no time for speeches here. >> he's not being rude thanks, folks. it's ten seconds late they gave it to us ten seconds. all right. welcome, everybody to "power launch." i'm tyler mathisen apple, record highs, market values now close to $900 billion after posting its best quarter in nearly two years. the company sells more than a bill dollars a day of goods. is a trillion-dollar valuation coming sooner than you think
we've had 24 hours to chew over it, and now the battle really begins over the gop tax bill the draining swamp, uh-uh. the swamp creatures are starting to move. the big sticking point could be a really tough sell for some republicans. the deduction of state and local taxes. president trump's twitter account deactivated by a departing employee, but twitter statements are now raising more questions than they have answered "power lunch" starts a little late but right now tyler, you're the braveheart of tv. we're getting those ten seconds back, baby are you with me? >> i am. >> freedom i'm brian sullivan stocks are steady on this jobs day. the dow hit another record high earlier. the dow on track for an eighth straight week of gains, as tyler highlighted. apple one of the big winners it's big in the dow. get this, investors have now made a 57% return on apple in
just a year. some of your big single stock stories today, starbucks rallying despite an outlook cut because ceo kevin johnson telling us, cnbc, he's optimistic they can beat new growth targets pandora, the other way that stock is down the music service missing estimates. its outlook coming in below expectations and all of you crypto currency fanatics, check this out bitcoin soaring to new highs here's a stat for you, michelle. the crypto currency market valued at $200 billion bitcoin up 933% in a year. wow. all right. let's stick with apple apple getting oh-so-close to becoming the first $900 billion company in the u.s., hitting a record high after reporting better than expected earnings. today the iphone x will officially be released it is hot, to say the least. in fact, really hot. 300 of them stolen off a u.p.s. truck in san francisco may not sound like a lot that's $300,000 plus worth of
iphones. let's go to josh lipton live at the apple store in palo alto, where he's trying to sell 300 iphones. josh >> reporter: brian, we got to this store at the crack of dawn this morning i can tell you at that point, the line was already down the block. my buddy john fort tells me he saw something similar at that 5th avenue store in new york city it's interesting we used to study those lines to carefully. now as consumers buy more online rather than in store, it's not as clear we did catch up with some of the people waiting on line, asked them why they were excited the first guy you're going to hear, he was the very first guy on line at this store. he told us he got here tuesday night. take a listen. >> it's probably the screen. i mean, the fact that there's all phone. >> ar is going to come eventually, but the hardware is there now. we'll see what people do with
the apps i think that's what will be really cool with the ar stuff. >> reporter: apple ceo tim cook was actually at the store this morning. that's become kind of a tradition. cook coming to this store in particular to welcome those first customers. i actually had the chance to catch up with apple ceo tim cook i asked him when he thought they would come into supply/demand balance for that new iphone x. cook telling me he could not give me a prediction at this point, heck not give me a timeline in part, he said, because this is a very different kind of rollout. this is a staggered rollout with that 8, 8 plus, now the x. in some sense, apple in some uncharted territory. skeptics bring out one note of caution, which is if availability gets pushed out too long, what kind of impact does that have on consumers at some point, do consumers just get what they can get their hands on maybe an 8, a 7, or a rival
device cook telling me, listen, people should get the phone that makes sense for them, whether that's the 8 or 7 he told me he's good with either the iphone x, they're making them as quickly as they can. back to you. >> josh, thank you very much let's talk more about apple's big earnings beat. joining us now is kevin o'leary, who was just talking a moment ago about handbags we're going to make the connection between apple's phone and the handbags he's the chairman of o shares etf investments. you've been on a couple times this week. i think i've got your name down this time. i'm feeling so good. >> you did >> you have just raised your price target you love when you see with apple. >> i do hope no one stole my iphone on that u.p.s. truck. >> a lot of hot phones, baby go ahead >> but listen, the fundamentals extremely solid in the quarter they just reported not only revenue eps beat, but china accelerated. china showed positive growth
services were up march quarter could be equally robust we think the path is for $12, $13 eps. stocks should be on that price point. >> it's at 172, 173 right now. it's impressive it's going to go higher but me making an individual choice about where i put my money, i don't know if that's enough gain that you expect considering how bullish you are. is there some place better besides this >> well, from our perspective in the group, we like apple the nice thing with apple is, listen, the 190, 195 price scenario is fairly realistic if you get tax reform done, that could add another $10, $15 to the stock. we think there's more leverage
to upside as you go forward. the 190, 195 is more if things go steady as they are, slightly upside it's not a bull case scenario by any means. >> the tax reform hook is obviously lower tax rates. kevin, you've been doing your own sort of channel checks you said you had sold some of your apple, right? >> sold half the week of september 21st >> because >> because i look at it in terms of where there's other opportunity. the biggest challenge i'm having with apple, and i'm still a shareholder and happy to have my position still on, but think about this nine years ago, the margins on the iphone -- by the way, the iphone is the majority of sales at apple you're a one-trick pony. >> you're an iphone company with some other things. >> a marvelous consumer brand. it was over 50% nine years ago today it's barely at 40% the driver of revenue is declining margins. offsetting that in the debate we were just having and right now the stock is winning is that services are coming up so fast
and the margins are so high that this will offset over time and that really the iphone is a trojan horse for software services in the future where you sit on that debate is where -- is the decision you have to make on whether you own this stock >> so you understand my question to him, which is a buck 95, that's all you're going to give me when you can get bigger growth somewhere else. it suggests to me that a lot of that is priced in with the massive gains. >> this will be one of the first consumer brands ever to get out of the hold of being consumer electronics into a software subscription service platform in perpetuity if they pull that off, this company has done something pretty well no one else has been able to do it looks like that's starting to happen, which is why people are optimistic >> a different take, outside of the iphone is there a concern -- this is going to sound a little weird. i apologize. is there a concern that everybody already owns apple stock? that it may be hard to go up when you look at where apple falls and all the top mutual
funds, all these etfs, everybody already owns it, and their share count is coming down i just wonder if literally they're going to run out of stock buyers it won't matter how many phones they sell. >> yeah, you know, hopefully money keeps getting into the equity versus leaving it that would be a natural tail wind from a lot of the work we have seen, apple, while to your point everyone does own it, we think it's actually relatively underweight for a lot of the growth portfolio managers out there. we still think there's some room over there generally what people have done in the last sixmonths, as good as apple stock has been, people would rather own the apple supply chain versus apple itself i think there's more room. >> thank you very much even c kevin, you're going to stick around it wasn't that long ago, folks, that we were all wondering what was wrong with apple it was dead, right >> we were worried about the upgrade cycle. were people going to be excited
about the phone? >> it hadn't moved in two years. >> it was a hardware story now it's a software subscription service. >> they've been trying to push that for a long time >> they continue to grow this was a fantastic quarter. >> and software companies get bigger multiples >> do you like crazy stats >> love crazy stats. >> how about this. apple's second business, apple services, is bigger than facebook's entire business >> yeah. >> in terms of revenue >> it trades at a discount to market even today. it's not given the respect it deserves because people are worried that it's a one-trick pony on a product called the iphone >> all right another big story today, job growth picked up last month, but some economists argue there are data points in the report that suggest labor market momentum is slowing. steve liesman joins us what are they talking about? >> some guys are -- i'm going to refute them more than give them voice here, if you don't mind. give me a second economists think they see slowing momentum i don't agree. a massive 261,000 jobs created in october
folks, you don't get to say this often. this missed expectations economists looking for a bigger, 350,000, jobs as a bounceback from the hurricane hobbled number from september. my take is this. three hurricanes affecting two of the nation's biggest states and puerto rico. how could anyone either guesstimate how many jobs were lost or how many would come back this month it was always a fool's errand to try to get this right. a bigger fool's errand to try to find a trend in it payroll is up 261. they brought back 90,000 jobs, added revisions to august, september. average hourly wages unchanged, but it was really affected at the half point labor force participation, 62.7%. although the headline figure disappointed the october jobs report is strong enough to lock in a fed rate hike next month. the chance of a fed rate hike actually ticked up a couple points to 90% as the market ignored the supposed weakness
and figured the fed would too. the bulk of the other data is pointing the strong growth in the economy, including isms this week off the charts on the service sector gdp last week at 3%. and i'm happy to tell you right now the cnbc rapid update, first look for the fourth quarter -- >> what is it? >> we did 3.1. then we did 3. now we're running 8. >> three threes in a row >> underlying growth you people with the whole numbers. you're really missing the story here 2.8 on top of underlying growth of 1.8 a full percentage point higher >> why is it when retailers miss their number, they blame it on the weather? economists blame the weather it's always the weather. basically that was a bad print, that was a weak number >> why is it when papa john's misses his number, he blames the nfl? >> why not the pizza
>> there were estimates as high as -- >> those were estimates. we're sad at 261 >> did you see what the hurricane in houston did to one of the largest cities in this country? there was weather, kevin there was serious weather. did you see what happened to puerto rico? >> i hate hurricanes it's bad what happened but it creates jobs. you got to build it back >> here's my point my point is that the job market i believe to be just fine. i'm looking at other data that tells me the economy is just fine >> i was listening this morning. you called the numbers polluted. >> absolutely. that's what i'm saying here. >> so they're not real those are real numbers >> i think i would wait a couple months, let things settle down >> these are bumpy numbers bumpy and lumpy. >> thank you, steve. >> i like to beat him up wherever i can the dow hitting new highs again and remains on track for an eighth straight week of
gains. rally on to the end of the year? what do you think of the market here is it expensive, or should you get in >> we continue to feel like the market has a very benign backdrop here. earnings, economics, and now rates between powell yesterday, between the jobs number this morning. low and slow rates going forward. that being said, markets don't go up in a straight line forever. we do see the case for maybe a 5% to 10% correction building. longer term, we see this economic backdrop remaining benign we think until we hit recessionary environment, which isn't going to happen in our view until 18 to 24 month, we won't get that big kind of 20% plus the case for a 5% to 10% correction, we haven't had a 10% correction in nearly two years 5% in maybe 13 months now. we think one would be healthy for the markets. we advise clients to kind of get their wish lists ready for when it does happen
but overall, we see benign environment here for equities. >> but statistically, it's expected >> yeah, you can't go up forever. >> mark, what do you think >> much of the same, quite frankly. statistically statistically, if you go back to the 1920s, years in which we had that kind of gain finished strongly that's occurred basically 86% of the time so you have very high probabilities to the extent past is prologue that we're in a seasonally strong period of time and history would suggest you're going to close the year on a good note. i would stay long here as well expect perhaps after the 1st of the year the potential for some pullback because it's more common that we'd experience it than not that said, to derail this bull market would require, in my mind, either a black swan or a recession. >> you're not worried about the flattening of the yield curve, mar mark some people would suggest that means an inverted yield curve. >> one of the things we've highlighted as a potential risk
is a monetary policy blunder we have about an 80-basis point spread between the two and ten year right now that's something we're monitoring to determine whether or not the fed perhaps increasingly emboldened because of the labor market reports decides to raise interest rates only to find the inflationary characteristics they defined as transitory don't develop as a consequence, perhaps, snuff out economic activity. >> kevin, where do you see the markets right now? >> so if i had to put money to work, which i do, i'm now favoring the russell 2000 over the s&p. my thinking is this. i'm a believer in some form of tax reform or tax reduction or whatever you want to call it that comes out of the meat grinder in q1. the majority of the revenues from small cap companies are in the russell. i see their cash flows increasing 15% next year, even if they only got a 20%, 22% corporate tax rate it's not the same for the s&p. 50% of its revenue is outside the country already tax
advantaged if i'm a betting man, and i am, i'm going to get a better return on the russell >> mona, what do you think about that call? >> we also see a similar type of rotation out of growth into more value names. we like energy here. we continue to like energy we think it's basing at $50, and i think some of the names have been oversold. we also continue to like financials, partly because we heard powell pointed yesterday he's a believer in regulation. we also heard tax reform >> you like small versus big multinationals >> we think small cap can overperform in the near term tax reform is a catalyst there i think small caps are generally domestically oriented. we do see, you know, tech continues to be a driver in this market right now we think that could continue but we think that there's ways to play it beyond just the fang names. we look at things like semiconductors >> anything that goes into those products thank you, lady and gentlemen. good to have you kevin, always fun.
>> thank you weekly recounts just out jackie deangelis is at the commodity desk >> baker hughes reporting that oil rigs declined this week, down to 729. drillers cutting rigs for the fourth week in five. this is also the biggest weekly drop since may of 2016 putting this in context, the overall recount is still higher by 279 than it was this time last year. but with oil trading at 55, this could be moving the other way, and it's not, guys >> all right jackie, thank you very much. well f you live in a blue state but vote republican, the tax bill probably ticks you off. your party likely going to raise your taxes, if not your cost of living coming up, we're going to speak with a republican congresswoman from new york state. yes, they exist. and ask her whether she can support it plus, squad goals for the president's big trip to asia last year, he said he was going to dig a hole to china. at&t is working with farmers to improve irrigation techniques.
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one of the key changes proposed in the new tax bill would be the elimination of the deductions for state and local taxes, otherwise known as salt, hold the salt. that salt is making the bill hard to swallow, ho-ho-ho, for republicans in high-tax states like new york and new jersey >> i got no salt jokes for you, tyler. the first signs of dissent that have emerged from within the gop are over this partial repeal of a very popular deduction five republicans from new york and new jersey oppose the
current version of the house tax plan at least six more say that they're still searching for the right compromise this bill gets rid of the deduction for state income taxes entirely, and it caps the deduction for property taxes at $10,000. new jersey representative tom mcarthur told reporters he wants the limit to go up to $12,500. only about 35% of the state and local tax deduction actually goes to real estate taxes. more than 60% is used for income taxes, so this could be a significant hit for households about 44 million households claim these deductions across all incomes and in every state and that makes this really hard to kill off. a coalition of state and local government organizations that call themselves americans against double taxation, they vow to fight this tax plan now, republican leadership argues that middle class families won't need this anymore because their plan doubles the standard deduction instead guys, i talked to house ways and
means committee chairman kevin brady yesterday. he said that he is staying at the negotiating table on this issue, and he hopes the other side does too. back over to you >> thank you very much appreciate that. so exactly how will republicans from blue states with high local taxes vote on the bill let's find out joining us is congresswoman claudia tenney of new york thank you for joining us >> thank you. >> given this bill is peppered with things like salt -- back at you, tyler -- could you vote yes on the bill as it is written today? >> we were told to pound salt. now we're getting some of it back >> blue state payback. it's a giant you know what to those of us living in high tax blue states. >> i get the argument that we don't want to be enablers to the tax and spend liberals that are basically one-party rule and control new york and force unfunded mandates down to our local governments, making our property taxes really high,
sales tax really high. our income tax is one of the highest in the nation. for us, we need a lifeline on this our leadership, to their credit, has been with us and working with us, the republicans in new york, one of the highest tax states in the nation i have eight counties i represent in upper new york. all of them are in the highest property tax areas in the nation so yes, it is a big issue. >> would you vote yes on the bill as it is written today? >> right the $10,000 cap is an improvement. i'm leaning yes. i still would like to see more i'm not going to stop fight. i'd love to see it eliminated altogether i'd like to see some kind of compromise on deductibility of the income tax now, in my district, upstate new york, adding back in even the 10,000 cap helps my district i would like to help it even more this is a middle-class tax cut
in my district we're keeping obama's highest rate at 39.5%. to me, i think it's just pure demagoguery for the democrats to be screaming about millionaires and billionaires the people who are going to get hurt on this are going to be the high earners in new york who pay the large majority of our revenue coming from the personal income tax >> do you know what percentage of your constituents itemize the standard deduction doubles, so therefore their argument is the deduction of state and local taxes for a lot of people is not going to be relevant >> we got statistics from my district that were applied by our leadership 62,000 people in my district, about 717,000 itemized of those most of them will be getting a tax cut. but they're going to be those. they tend to be upper middle income high income tax earners will not be getting a tax cut the president is keeping that rate, the 39.5
but the fact that our taxes are state and local taxes are so high is what scoops up these middle income taxpayers. doubling the standard deduction is a huge help, especially for the middle class removing the alternative minimum tax is a big help. but i think we need to negotiate more on this so-called property tax cap. i agree with my colleague congressman mcarthur i think 12.5 is a little low i'd like to go higher. we have farmers who own huge tracts of land, and their property taxes are enormous. i'm going to continue to fight i've been told this is flexible, it's fluid, we're still negotiating, and to keep fighting the fight for new york. that's what i'm going to do. >> did i hear you correctly that of your district of 717,000 individuals, only 62,000 itemize. >> filers. >> 62,000 filers so the 700,000 people would be -- that doesn't mean the
number of filers but it is a relatively small percentage that percentage would come down as the standard deduction goes up >> and they're catching a lot -- as i said, taking away the amt, taking away or doubling the standard deduction, lowering the rate, starting at zero is going to help a large number of my constituents but not -- and isn't this supposed to be a tax cut for everyone that's what we're fighting for we want to make sure there's growth >> but you do agree it is a tax cut for the vast majority of your constituents, right >> for my constituents, it is a tax cut, yes >> here's what i've always thought. agree, disagree. the minute they got rid of the state and local tax deduction, it might actually force albany to act once they see people going to move. they might actually lower taxes. >> yes and again, at the top of the interview, i said are we and
enabling a tax and spend aggressive governor who has a state with the largest migration of jobs and people we have the highest cronyism rate that means we use more taxpayer dollars for cronyist schemes to give to companies and people who are just currying favor with the governor and he's got presidential aspirations. so he's afraid to touch this issue. but let me tell you something. he's spending us into oblivion they don't expect or care about the taxpayers. i know that. i served in the new york state assembly i know what it's like down there. i know we're fighting as republicans to try to save this. we're trying to help our state i'm a manufacturer my family business is manufacturing. we are fighting for our small businesses but we need growth, and there are some really good things about this plan. we are bringing over repatriation of money. we're also eliminating the estate tax, which could be a big help to a number of people, especially small family farms. >> thank you so much, congresswoman. really appreciate it >> thank you >> well, democrats whined for years that the people weren't
doing their fair share guess what, they're saying to the blue states, here, do your fair share president trump leaving the white house today for hawaii before he heads to asia for his longest and perhaps most important overseas trip as president. what is he hoping to accomplish? kayla joining us now from washington before she leaves for asia as well >> hey, michelle in president trump's nine months in office, he's upended the region's status quo on trade and escalated the war of words with north korea. with this 12-day trip to the indo-pacific region, he'll seek to reinforce alliances with south korea and japan and continue dialogue with china to rebalance trade deaf its and defund kim jong-un's nuclear ambitions. two air force bombers performed another flyover of the korean peninsula overnight ahead of the visit. yesterday national security adviser h.r. mcmaster said time is running out for diplomacy with pyongyang, and despite being on the ground, trump will not mince words. >> i don't think the president really modulates his language.
have you noticed him do that he's been very clear about it. let me just talk about this quickly. i've been aware of the discussions about, hey, is this inflammatory what's inflammatory is the north carolinian regime and what they're doing to threaten the world. >> press secretary sarah sanders says expect the president to keep tweeting while he's overseas another white house official says jared kushner will join the trip through china china is where the u.s. delegation is going to be accompanied by 29 u.s. executives armed with ready to announce deals ceos of goldman sachs, qualcomm, and air products you have division heads from boeing and ge and nearly a dozen companies from the energy space with a particular focus on the exporting of liquefied natural gas. the president's first stop will be hawaii to a joint air force base on oahu he's expected to land, guys, tonight at 7:00 p.m. eastern time back to you. >> all right, kayla. thank you.
up next, michael lewis, the author, he has an interesting new piece on the size, scope, and confusion of our government agencies, one in particular. we'll talk to michael lewis. my experience with usaa has been excellent. they always refer to me as master sergeant. they really appreciate the military family, and it really shows. we've got auto insurance, homeowners insurance. had an accident with a vehicle, i actually called usaa before we called the police. usaa was there hands-on very quick very prompt. i feel like we're being handled as people that actually have a genuine need. we're the webber family and we are usaa members for life. usaa, get your insurance quote today.
so that's the idea. what do you think? hate to play devil's advocate but... i kind of feel like it's a game changer. i wouldn't go that far. are you there? he's probably on mute. yeah... gary won't like it. why? because he's gary. (phone ringing) what? keep going! yeah... (laughs) (voice on phone) it's not millennial enough. there are a lot of ways to say no. thank you so much. thank you! so we're doing it. yes! "we got a yes!" start saying yes to your company's best ideas. let us help with money and know-how, so you can get business done. american express open.
line pennsylvania avenue and lafayette park were also closed to pedestrians the incident came just minutes after president trump departed the white house to begin his trip to asia ivanka trump addressing an international conference for women in tokyo she appeared with japanese prime minister abe and told the audience she joined her father's administration to advance women's causes >> the economic empowerment of women has been a focus of mine for many years that is why after my father's election i decided to leave my businesses and work in government to advance policies and initiatives that empower women to fully participate in the economy if they so choose. a florida woman was arrested for driving under the influence while riding a horse 53-year-old donna burn was taken in by sheriff's deputies after they responded to a report that she appeared confused while on the horse. she failed a field sobriety test the horse is fine.
that's the news update at this hour ty, back to you. >> a woman on a horse walks into a bar. i don't know >> no horsing around >> that's the story with a lot of kicks sue, thank you >> you can lead the horse to the bar, but can you make him drink? >> not the horse apparently. in with one nominee, out with another. sam clovis withdraws from nomination to be the top scientist at the department of agriculture after being connected to the russia probe. also drawing criticism for his complete lack of scientific credentials, though that may not be fair because he does have a degree in political science. in the new issue of "vanity fair," michael lewis exposes the size and confusion within our federal agency, specifically the usda michael, welcome back to "power lunch. before we get to the u is,sda a this amazing story, i want to talk about two things first. one, you must be thrilled that
richard thaler, after your book "the undoing project" on behavioral science won the nobel prize. and two, having done money ball, you must be pretty thrilled that a low payroll team, or relatively low, like the astros, won the world series >> yeah, it's a lot to take in all at once. it was very funny. i had dinner with richard a couple weeks ago right after he won it then i went to an event and a woman came up to me with kind of dewy eyes and said, i want to congratulate you on winning the nobel prize. i said, what she said, i heard you won the nobel prize in economics i said, i think you're getting me confused with one of my subjects but it's good. it shows you if you get close enough to these nobel prize winners, people think you won. >> soon enough maybe you will, michael. who knows. you've done enough writing and thinking about economics >> i wouldn't like the odds on it and the baseball thing, what was interesting to me about the world series is on both sides,
you had essentially children of billy bean but the gm of the dodgers and the gm of the astros really aren't even in the game if billy bean doesn't do what he does the game has morphed to the point where -- and the rap on it back then, people said, it's going to be boring, no one's going to watch it's a bunch of nerds on the field, basically it has become a lot more intellectual, but even so, it was an absolutely thrilling world series >> that's part of the appeal it is an intellectual game data is increasingly driving personnel. let's turn to the article in "vanity fair." it is populated with fascinating characters, including the lead character, a young man who came to this country from pakistan in his youth and went on to extremely influential jobs in the government it seems to me your point about the u.s. department of agriculture is, in part, no one
seems to know how powerful and big it is, what it does, and what the trump administration seems to be doing to it or undoing to it. >> there were a lot of points. i should back away from this for a minute and explain why i even wrote an article about the department of agriculture. what is interesting, it's part of a series i'm doing. what interested me is that the obama administration had gone to such great lengths to prepare for the transition that is spent the better part of a year to prepare briefing books, talks for whoever came into the government to get them up to speed right away that's normally what happens the day after the election, people roll into the department of agriculture, the department of energy or whenever it is and get briefed. they cram for 80 days about what this operation is about. in the case of trump administration, for the most part, they did not show for any
of this. so they didn't get the briefings. what i've been doing is going and getting the briefings, just to try to understand what they didn't bother to learn and try to get a sense of where the government is vulnerable not necessarily to an ideological attack but just ineptitude and misunderstanding. >> how do you explain the fact that few people from the trump transition team or early on after the inauguration were there on site at the usda. how do you explain that? is it perhaps they didn't think they were going to win >> you're explaining it. absolutely >> part of the agenda is to deconstruct big parts of the federal apparatus. >> i don't think it was as well thought out as that. they had a transition team in place ran by chris christie. trump fired him the moment he was elected. i think it was disorganization more than anything else. a by-product of the
disorganization is, well, you know, if you run it into the ground, maybe it will be disassembled and shrunk. if you run it badly enough, you might achieve some end that you want to achieve. but it's quixotic the way they're doing it let's take an example. inside the department of agriculture, which i maintain is kind of misnamed because it really is like the department for the little guy the biggest part of the budget, $160 billion, $110 billion of that goes to feeding poor people mostly kids and the elderly, some working age people because of work requirements attached to that it's the food stamps, what used to be called the food stamps program. it's school nutrition programs, so on and so forth as the person who ran that for eight years under obama said, if you want to actually eliminate the food stamps or undermine it, what you do is run it really badly so there's a lot of fraud in it, and it will lose political support. so it's a very underhanded way to go about it if that's how
they're going about it, but i'm not quite sure that's what they're doing. i think there really is just mostly ineptitude. >> it's a fascinating story. michael, thank you so much i commend it, and i commend your book "the undoing project" on behavioral economics, which talks about richard thaler, among other economists whom you are most familiar with always great to have you with us >> thanks for having me. >> thank you coming up, while the people of venezuela line up to get food and gas, the bondholders had always been paid n'ng may be about to chae. dot move we discuss right after the break.
lunch. many thought the jobs report would be stronger. the numbers weren't bad. wages weren't very good. we didn't get escape velocity. look at the two-year note yield. basically the highest since october 2008 bl you look at tens minus twos or 30 minus fives, those spreads are the flatters in ten years. that makes rate increases a bit
nervous towards investors. let's look at the main reason that i see look a the year to date of the french note. year to be date of the spanish tens they're at 1.79. their rates continue to drag us down some central banks aren't playing the game that bank of england and our fed are doing. these are important issues they really are going to be meaningful, potentially, to the new fed chairman jay powell. if they raise and invert the curve, stock market investors aren't going to like that? what lies ahead for the curve? hard to tell "per lchowun" will return in two minutes. life happens. that's why feeling safe is priceless. with adt, you can feel safe with an adt starter kit professionally installed for only $49.00. call today, and install an adt starter kit that includes
it's time for your business of the week. danny cohn of seattle, washington, has take an 100-year-old family tradition and turned it on its head. she's reimagined the neighborhood corner store for the new millennial generation. in just two years, her local business has grown into a three-store chain. to find out more, watch "your business" weekend mornings at 7:30 on msnbc. >> sponsored by american express, founding partner of small business saturday. shop small on november 25th. the leader of venezuela announced late yesterday the country is going to renegotiate its debts. he made the announcement in a nationally televised event
it's a dramatic turnaround for a country that long insisted it would prioritize paying debt that's why venezuela's bonds are selling off today. take a look at this bond, which matures next year. yielding 157%. this restructuring, however, could nearly impossible. joining us to discuss why is danny of indian capital management extraordinarily, maduro announced the person who's going to be in charge of this restructuring is a guy who's the vice president of the country. he's on the sanctions list of the united states for being a narco trafficker he has alleged links to hezbollah. can anybody in the united states actually sit down and negotiate with this guy? >> tareck is the vice president of venezuela he is on the sanctions list. close to hezbollah, close to iran, close to cuba. i think compliance officers everywhere are -- their heads are exploding as portfolio managers, lawyers, and investment bankers ask them, can i go and meet with this person
that is not happening. >> it would be like negotiating with pablo escobar >> it's the 2017 version of pablo escobar. >> in addition, there are new sanctions put on by the trump administration that said, okay, all the bonds that already exist from venezuela, you're all free to trade them. anything new, you're not allowed to buy that would also impact restructuring, no? >> very much so. restructuring includes tinkering with old bonds that are not being paid and clearing the way for new issuance, new transactions as the executive order from president trump stands and as the sanctions stand, they would have to be rescinded they'd have to be walked back or something would have to be amended. as they stand, you cannot engage with debt restructuring with these folks. >> why would they put someone in charge of the debt restructuring that they know cannot actually get involved with most of the debt holders >> there are so many questions that are so confusing in regards to this matter maduro announced he would pay two bonds this week, that in
their totality are $2.5 billion that are 25% of the international reserves of the country. and then default usually you either pay or don't pay. seldom do you pay and then -- >> is he sane, maduro? i don't mean that as a joke. what you're saying not seems criminal and dumb but just not -- with it >> right >> i don't know what's a better word >> how do you say nuts spanish? >> loco. it is possibly but we under estimated in the marketplace and gee o politics politics many times. >> what happens next year? >> the default does not occur. at that point, the machine will kick in $65 billion worth of debt will be in default. >> in the past, when they have been able to pay, we have learned because the russians gave them $6 billion and the chinese have given them money.
does this mean they're no longer getting money from the russians and chinese? can we draw any conclusions? >> this is at awe that came this week the chinese and russians are not pulling out of venezuela i think it is important to remind everyone that $300 billion of oil reserve in venezuela is a huge amount, the angelina joliest largest in the world and now russia and india, they're not pulling out. danny, thank you very much for coming in. >> good to be here investors in pandora are losing a quarter of their money today we'll take a look at that and a couple of calls on "street talk." we'll speak with the mayor in cleveland. does cleveland rock? we'll find out wait, what, what happened? i was having a good round, and then my friend, sheila, right as i was stepping into the tee box mentioned a tip a pro gave her.
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player this is according to bloomberg citing sources it is an interesting development only guys because qualcomm is in a very big heated patent battle with apple over wireless technolog technology it is very much about apple today and not just of the share price today but also because of these two companies on the hills of bloomberg headlines >> was it over yesterday >> yes >> because they are moving over sea. don, that's a big story. when you first brought it to me, i thought qualcomm cannot fight broad com. qualcomm of its recent woes. >> wow, theoretically, qualcomm used to be smaller >> this is around the hills of
qualcomm slashing their he headquarter moving back to singapore. it is almost like a soap opera d developing here. >> by the way, qualcomm, it may not have the most intellectual property of any company, it is close. a number of years ago, i did a show from broadcom and it had 79,000 packs you wonder qualcomm, maybe just interested in going after the ip >> you did the live show from qualcomm >> okay, i read every one of those patents. that's a lot of reading. >> there you go. >> that's a lot of intellectual property nice combination if it happens it is a big hypothetical >> big story >> you know what they put on tv
stations >> antennas. [ laughter ] >> sorry >> but, but, the same response, don, you are clear lay genius. thanks don >> you guys were going to do a different segment. i know that and the viewers know that, they would not have known that >> they got broadcom instead >> coming up, "power lunch." we'll tell you which area of the economy is desperate for workers. we'll have the hottest holiday toys onset, stay with us
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. welcome to "power lunch. i am still brian sullivan. >> plus, a trillion bucks here we come as apple is near $900 billion cap we'll talk about what wall street thinks apple can do from here and whether it will get the big "t." just 51 days until christmas the list of the hot toys that everybody is fighting for is here we'll show it to you right now, listen up, your kids is going to want this stuff.
"power lunch" begins right now ♪ a check on the market. the stocks are in the green right now. the dow is sending a record in today's high after the open of retrieving from those highs. the dow remaining on track of eight straight weeks of gains right now. it is higher by 34 points and the nasdaq is by 7 apple is the big stock today the company briefly hitting 900 billion. hired by more than 3%. activision is lower and t-mobile and sprint are higher. t-mobile has made a revised offer to merge with sprint, on and off again, you know? the story breaking moments ago, we are watching reports that broadcom is exploring a deal to buy qualcomm >> more on this action
bob pisani is on the floor with the latest >> hell lo tyler. >> tech and energy is what we are all about. tech has been strong all morning. apple supplier is pulling everything to the upside utility energy and bank stocks are also on top and leaving as well you can see, spider banks are down and that's a problem. the average hour earnings were disappointment and we had lower yields throughout the day here let me show you some of the tech names are up apple is up and corning and advance micro and nvidia and broadcom buying qualcomm that's quite a deal. broadcom is $113 billion cap and ca
qua qualcomm is $9 billion cap another one of those rallies, we'll see if this run lasts. a lot of heartbreaking energy this year. earnings season, it is getting better and better, we are almost at 8%. i think we'll hit 8% probably in the next day or so, revenues are up 5%. bottom line is for the fourth quarter is what we care about, the numbers have been steady up around 12% and that's what we want to hear nobody is dramatically lowering the guidance and that's the reason stock market remains near record highs guys, back to you. >> thank you, bob. apple is leading the race to become the first trillion dollar company. who else is in the running d dominic chu is here with more. >> if you take a look at apple, they added $283 billion in market cap just for apple this year alone a little bit of that perspective
here, $283 billion is more than the value of wells fargo they added wells fargo under their market values just this year or another way to ibm that's a big move higher in terms of apple overall if you take a look at some of the other stocks we are talking about with regards to big moves and market cap if we do some analyst target prices met over the courses of twelve months, we could see some movement by bigger companies out there. alphabet, the second place company in terms of market cap, that i think bbrings it to $12 n microsoft forecasts to go up by 6%, that'll bring them up by $700 billion amazon, 14% gains of what analysts are looking at, that'll bring them up to around $600 billion mark and facebook up by 16% if analysts have it
right. that puts up apple got a hefty lead, we'll see if it will keep going. these are nipping on the hills but they are still third and fourth comparing to what's happening with apple brian, back over to you. >> speaking of apple, listen to this here is your random but incredibly interesting stat of the day. the folks are saying at the mark cap of apple, alphabet and microsoft, just three companies together, is now equal to the entire 2,000 >> that's 2,000 companies? >> exactly what i am going to say. >> how comfortable should investors be in a market dominated by a couple of companies, bringing our ron isana. >> yes >> the rest is struggle in tinge
back does it worry of this market is dominated by literally five or six players? >> yes, you get concern when the market is narrow and it is not quite as strong. comparing to the russell 2,000 of by definition of a small cap index, there is a lot of tiny companies in there that would add to something but certainly -- >> just having some fun. >> new york cio, i am just sayi markets have narrowed. that can be concerning if you go back to the year 2000s, remember $600 billion was the market cap that everyone topped out that was intel and kcisco back i the peak of the 2000 era >> apple maybe a little different. >> why >> they do it as over used expression and they have an ecosystem and a product cycle. they're not showing signs of
slowing down when you saw ge and intel, we are coming to the end of explosive cycle that was driven by the company's performance but wide varieties of other factors. >> by the way, i have never seen michelle walking without her iphone that's the point it is an accessory, it is apart of our -- >> it is hard to share with other companies, i don't know. >> 25% of evaluations. >> 40th largest fund manager the point is this. even lodgistically, all hundreds of etfs have them at the top or near the top holdings, if people decide to start selling those etfs, would they flush the entire market? >> well, there is the possibility that the bigger they are, the harder they fall. don't forget of thow extensive
the liquidity of the market is we wcan look below that or beneath that whether positive catalyst for growth we'll do that and it is not picker as an tuopportunity. >> it is interesting brian, why you bring that, you have companies like ge and microsoft and intel and cisco added to the indexes and began to be extremely heavily waited when the plush came, yes, some of those, both cisco and general electric never recovered >> never >> microsoft and intel since recovered. microsoft taking out that 2000s high and intel, i am not sure if they have. if you get a flush, it is a problem. >> big risk. >> it can happen >> last word for you dave, what are you doing at this point as we discuss and basically asking whether or not we are at market
highs and should you be worried? >> we don't think we are at market highs we think the market continues in 2018 and our allocations advise of over weight and equities are relative to fix income we think the earnings of directory here is quite strong into 2018. we are not assuming anything but that's kind of a potential call on an acceleration of economic and profit growth over 2018 and 2019 as long as we see that profit growth continuing to pick up, we'll remain bullish >> thank you, guys, ron and don. >> lets get more on this broadc broadcom/qualcomm story with dom. >> yes, there is a lot of rhyming here lets call your attention of qualcomm shares right now, before they were at 7% or 8% with regards to a possible deal for broadcom to acquire qualcomm it is up towards 15%, it is up
as high as 20% we are talking about shares of qualcomm this is on the hills of dow jones headlines saying that broadcom is planning to make it big for qualcomm again, source reporting from dow jones, that's the reason why we saw an extension of those from qualcomm shares of broadcom are now near their session highs up by 5% a lot of moving part here, tyler, brian, and michelle, brian, you brought it up before of the market caps, it is now worth $93 billion. you are getting closer to that merger of equal type range >> i am going to get a little conspiracy theory on you here, guys >> you never do. >> maybe it is a little friday's fruit loops on my part having done a show on qualcomm,
again, this was 2009 or 2010, some of that intellectual property maybe from a governmental perspective, top street, broadcom was based in singapore. we have seen the government get very concerned about foreign entities buying corporations that had a, a lot of electric property and b electric property which maybe sensitive from a defense perspective. >> so bingo, was canyon road supposed to buy, what was the name i cannot remember the name >> l. l.a. tis company. >> i wonder if part of broadc broadcom's announcement yesterday to move back to the united states was knowing this deal would be politically sen
sensitive and having an hq in the u.s. could be more >> it is possible. >> it makes sense. >> the thing to add to it and dom, you will notice it too that broadcom is way up and qualcomm is down. broadcom got a real advantage in the its of its currencies. >> when we talk about qualcomm, there was a point in in time where qualcomm was the bell of the ball they were doing wireless communication ships and they worth more than intel. intel gottien a lot of that swagger back again and maybe looking more at intel chips and conductor of their products. >> so there is so many different players involved in this right now. i mean it is an interesting theory, yours with regards to qualcomm and broadcom. qualcomm is a company, like you said they have been on a trajectory not like the rest of
the semiconductor business >> i maybe wrong if singapore company tries to buy u.s. company soundsa lot worst. >> domcom, thank you very much [ laughter ] >> appreciate it >> it is been a busy week. the new tax bill front and center, joining us now is president and ceo of the national urban league and our republican strategist, aid of president george h.w. bush i am going set aside of this session, we have enough about it and i can guess where both of you are on this. i want to hear your views on the health of the american economy right now with unemployment lower than it is been. who can read too much into these numbers because of the storms we
went through mark moralial, how hellty is the company right now. >> the 200,000 jobs is a strong number particularly after a dow month month due to the hurricanes in september. the economy is strong with storm clouds on the horizon, those relat relate to the company of wages and growth of income and potential drag that it has on consumer spending which is a driver in the economy. so i would point to that as a real risk we face going forward and the idea that when you got a long period of economic growth, sometime you are getting closer to recess or dip the recovery which on president obama remains uninvaded.
if there is no wrong moves, we'll see growth but there must be much more attention paid to the press wages and those pockets of americans where unemployment remaining high. >> joe, your same assessment which i think is a little different than the mayor's how do you think the american economy is going and why don't you pick up on his point about wages? >> well, i know wages are a bit stagna stagnant i think they'll be better in times especially the economy continues to move in the right direction. i think we are doing well and i think we are moving in the same direction. that's wha very, very good numbr i was glad to see how we bounce back after the hurricanes. that was a good indicator. i like the indicator like the numbers o f americans working part time for economic reasons, those numbers continue to go down every single month. about a year ago, we were talking about 600 million
americans and now 4.8 million americans. that's the right direction for us to be headed and our economy is stronger and i have to reason to oppose that we are headed for trouble. >> you don't see the same historical >> president obama spent a lot of his time in office talking about the economy he inherited from his predecessor do you expect president trump talk about the growing economy that he inherited from his predecessor? >> i think president trump will talk about as a republican, he's moving forward on lowering regulations and now lowering taxes and he is putting into place all because of incentives and americans and business wanted here for the economy to grow he will say the reform that he's put into place and programs he's pushing are the reasons for the economy. >> gentlemen, thank you very
much >> mayor morial, i will be watching lsu this weekend. >> go tigers >> good to see both of you >> here is what's coming up of "power lunch." a new report on linked in on which industry urgently need employees now. >> 51 days in counting for christmas. we'll run you through the top toys that's on the shelves this season >> and crude oil selling, we'll tell you the best place. all that and much more coming up on "power lunch.
data from linked in shows big jobs grow in two areas may surprise you joining us is dan roth, editor and chief of linked in, good to have you with us >> thank you you say there is a lot of openings for truck drivers in america these days what kind of special training or driver's licenses do you have to have and why is there such a shortage >> yes, this is a golden era for truck drivers right now. you have a situation where the economy is booming and unemployment is 17 years low and you got a 13 year high and people need goods everywhere and there is not enough truck drivers to move stuff around truck drivers are being
recruited in the same way as software engineer is being recruited. it is a different world for them, they get to make demands like i want direct tv and sleep in hotels and not in my truck. it is a different era right now. it is one that may not lasts as automation comes in. >> so driving vehicles is apart of that. >> exactly >> lets talk about energy where companies are shedding jobs a couple of years ago and now you are saying they are hiring back again, what kind of skills and where? >> a lot of these are anywhere where it is oiled off. the skills in demand are oil management but it goes well beyond that. it is software engineering and data science and accounting. the oil company intends to hire and they shed people as the prices go down it is not surprising to see them suddenly needing to bring people
back into get the oil flowing. we saw 20% increase year over year in hiring the biggest industry driving us is oil and gas >> dan roth with linked in as a realtime view of what's happening in the jobs market thank you. >> thank you a recent college graduate are flocking to veterinarian schools. kate rogers is in pennsylvania her first series, where the jobs are. kate >> reporter: hey there michelle. that's right, most people want to work in animal healthcare do discover their passion at a young age. it is very intense and competitive. if you make it through, you will have a broad range of career opportuniti opportunities. >> she always thought she will be a small animal veterinarian after a study , she changed her
plans. people dependant on their livelihoods everyday today she's in her fourth year veterinarian school studying to become a food animal vet at a time when food safety is increasingly important to consumers. she's studying from large annals or dairy production. >> the food we are eating and products we are use ing and a l of different realms. students have two job offers upon graduation. parsons is hoping to run a sustainable goat farm in west africa, a project she's been working for two years. >> the best way is thinking of how we can be involved in where things are larger than the original anna
origin original annaimal s. >> reporter: you can make well into the six figures and how cute are these baby cows they are just a couple of mathew knopes -- months olds. >> kate, the best veterinarian school of the united states is in virginia. >> you are a graduate there. >> i rule for the cows [ laughter ] >> that explains everything. [ laughter ] >> yuva had shirts >> we have changed >> we did not have a vet school >> no, you did not attention, people with young children, we'll show you the first look of the hottest toys before the holidays so you don't veha to fight the cry and make your kids cry. we'll be back after this she's nationally recognized
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kourtney is here with our top toys we actually do have to talk about the top holiday toys they are already in short supplies the hottest toys this is largely of the popularity of unboxing youtube videos, interactive toys so hhaatchimals. they are still big and an artificial intelligence powered doll that's also by the same company that makes hatchimals and you got the finger links here. these little guys go on your
fingers and different monkeys and they are interactive >> how much does it cost >> so this one was $14.84 at walmart. we had to go to three stores to find it. >> already >> wow >> this hatchimal version at walmart was $8.88. >> does it matter which fingers? >> it does not [ laughter ] >> we started on unboxing one if toupt keep going you may have to rip the plastic. >> it is the element of surprise there is all these little toys and you don't know what you are going to get you know it is a little outfit and doll and you know what you are going to get it is unboxing and more and more >> yeah. >> oh. so jim silver runs ttpm, he says this is the first time in 25 years that he has seen the level of sell out.
>> the shells. >> the whole thing is what you are going to get, it is the surprise >> and we have this big lol surprise so michelle has a big ball and this one is 70 bucks from target >> target's cheap merchandise have flying off the shelves already. >> this is a little purse. >> i see >> it does >> it is kind of cute. >> a little pittsburgh aurse ant unbox it walmart says the finger links and the hatchimals it is pretty tight and constraints and we are hearing more they don't want to end up with extra merchandise. thanks for the head ups, courtney >> lets go to sue herrera with our cnbc update. >> hello everyone, house democratic leader, at a news
conference this morning and nancy pelosi claiming republicans are making outrageous claims. >> to our colleagues, get real don't tell the middle class this is for them. you are throwing a few crumbs, it is really making suckers of the american people. we have to speak in some boll language about this because in this representation is so outrageous pakistan, tight security, his lawyer asked the judges to merge three corruption cases against him into one, sharif has plead not guilty 63 sears and k-mart stores will be closed this year >> you are up to date, that's
the news update at this hour brian, back to you >> sue, thank you very much. the oil mark is closing for the day and jackie d how are we looking >> oil prices today closing well over $55 a barrel, near sessions high we saw a 2% gain today and 3.25% per weeks. the bulls are going to dell you it is justified and the long waited rebalance are in place and there are too many supply risks in the market that could threaten a significant amount of production the bears would say short terms. session high today is 55 and 68. sessions low, 54 back to you. cleveland rocks, that's the message the the north coast want amazon to hear can cleveland come out on top in its bid for amazon'sec sond headquarter. we'll talk to the city's mayor
straight ahead on "power lunch." ♪ ♪ my ambition? helping people get what they want, understanding we're not in this alone, and teaching my kids that no ambition's out of reach. ambitions live everywhere. synchrony financial helps make them happen with data, insights, financing and technologies. ♪ ♪ synchrony financial. what are you working forward to? synchrony financial. i can't wait for her to have that college experience that i had. the classes, the friends, the independence. and since we planned for it, that student debt is the one experience, i'm glad she'll miss when you have the right financial advisor, life can be brilliant.
his family. his steinway, which met a burst pipe. so grant met his insurance: you are caller number 12. which didn't quite cover the steinway. but what if he'd met pure insurance? owned by members. he'd have met: lisa, your member advocate. who'd introduce him to gustav, a temporary address, and help him get tickets to the mozart festival. excuse me, grant likes beethoven! uh, the beethoven festival. pure. love your insurance. the bids are in.
scott cohn is standing by the lake in cleveland. >> reporter: hey tyler, this city and the state have come from such a long way they like to call it the knowledge belt these days. when we compared ohio to amazon using our business category, there are some areas where the state came up lacking. we give it a c minus overall for reasons that we'll explain i want to bring in the mayor of cleav cleveland, frank jackson, it is good to have you with us, seeking a fourth term, how important is amazon to you and the city >> well, any time you have 50,000 jobs coming into a city its got to be important and not only those jobs and sales but all those other things that
resolves in those jobs being there. >> you feel like you got a shot? >> we don't waste our time >> lets talk about the report card that we have done and we don't know how samazon is going to grade this. we looked at their main categories and we found that you do well in population as a state. all the places that are going to do well. a plus there, you do okay on location and could do better in air travel but that was a c plus in our estimation but on stability and business friendly less, that's an f in our estimation and in talents because you have a shortage of tech workers, that's sort of an f. it is a close call i know you disagree. give me the argument >> well, you are talking about states we believe we do well here in cleveland.
and, any time an opportunity like this presents itself, people usually step their games up if there is a need to address deficiency no matter what they are, they'll be addressed by the state or the local government. >> reporter: you are not giving any details of your bid neither is the other cities. on tuesday you said that you should make it public, this is a big project, why should people be able to evaluate and given away the story >> because we are trying to win. >> reporter: what about the people and the taxpayers money and whether this place can afford it? >> we are trying to win this bid just like we did, it is no difference that we did for republican national convention f we are trying to win >> reporter: mayor jackson, good luck with it and we appreciate you taking the time. >> we'll continue to go from city to city on this amazon
race our next stop is coming up soon. >> thank you very much with that scott. we cannot wait to see. coming up, welcome talk about this news breaking whether or not broadcom wants to buy qualcomm what does it have to do of whether the federal government is worried on federal conductor deals. qualcomm is getting a big boost after having a tghou year from their battle with apple. don't move your brain is an amazing thing.
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so big breaking news in business, reports that broadcom is planning a bid for qualcomm lets bring in our fast money and a analyst, it is just the report right now, do you believe that broadcom will try to buy qualcomm, do you believe the report, romit shah >> i think it makes a ton of sense. in the past that qualcomm would be at the top of broadcom's wish
list there is a lot of reasons for it >> such as >> scales. they would be adding roughly $30 billion in revenues and qualcomm has very high operating expenses and broadcom is incredibly successful at creating merger energy and would be highly increased. if you look at cell phones and carriers a carriers, the number one thing they try to add is baband -- >> talking about moving from
singapore to the united states, and speculations he did that in order to get approval to buy the semiconductor. are they going buy qualcomm? >> i heard brian said a cold on qualcomm but he pointed out all the reasons thisskill makes a lot of sense, it indicated to me, i look at this and say if i make qualcomm shareholder, they are out of the blaze they put themselves in the last couple of years. >> battling it out >> i am not certain this deal will make sense for them of the $70 price target they have an uncredible balance sheet. >> romit, what do you think is going on here? >> well, i think they are definitely on track to close
we are making it happen. we spoke to broadcom yesterday after they made the announcement and yes, lets emulate and continue to be an important part of our strategy and that extends beyond and this journal article is right we now know another reason why >> well, they have to buy brokade. >> their block is different. if they found we find it sooner, they got to pay $195 million break up fee to brokade. >> there is one more aspect and component of this. there is a qualcomm that's sort of out there as well >> it is not a significant deal by the way >> are there any obstacles in the qualcomm shareholder base
against this deal? >> the jacob's family. i don't know >> i will try to answer and i will let romit -- do key shareholders want to sell? >> in my opinion, they should not want to sell, maybe a year and a half ago, we could have the conversation be a much different answer i think now there is light at the end of the tunnel for the first time in qualcomm for about 18 months to two years i will say this though, the last that i looked is lower we are looking for a trade, nxp can be interesting once again. maybe given the environment that we find ourselves in and some others coming down walking the lane >> it is going lower in the middle of the session so people are thinking that's bad. >> yeah. >> the trader in me looks at this and says i understand why nxp is lower but i can
understand why maybe you should look at it differently and maybe xp becomes desirable for somebody else. >> all right, thanks guys, romit shah, it is good to have you on lets turn now with president trump nominating jay powell, w joining us now to talk a little more about this is senior mccolough and our own steve liesman. >> what do you think of jay powell where would the interest rate be today instead of janet yellen, higher or the same >> mr. trump did not want to pick yellen for political reasons. it was good decision on the part
of mr. trump >> the difference between the two, maybe not a monitory policy but their views on banks >> we think rules that came out of dodd frank and the idea that we got it so right the first time that we should not go back and rethink it president trump says he wants to do a number on dodd frank but the documents that he's put out, the big number on dodd frank the documents that he put out is having less extreme. i want to make one point of picking jay powell, he's not a victory as a defeat for certain people who wanted big change at the federal reserve. more of them disagree of how the federal reserve makes policy the level of federal reserve
rates right now and how it is going its business donald trump thought about those people and that way of doing fed policy and he rejected it. >> i very much agree with steve there. it is a victory for the economy and a victory for good policies. there were certainly those on the republican side who wanted to shake things up because -- i think mr. trump not being a log was problematic. the feds done a fantastic job. where the fed is now is consistent of where trump wants to be on the economy because trump wants to run a grand experience of a high pressure economy. getting the economy from two to three. >> our old buddy told us a couple of days ago and weeks ago the same that the fed makes a
mistake on the other side that the increase were too rapid, i am not going to say it will crash the economy but it could lead to a major slow down and if not a recession. a, do you agree with your friend and former colleague or"b," if a you think jay powell has the ability to do that >> i don't -- i don't think he has the interest in doing that i don't think he want to slow down the economy for the sake of slowing down the economy in proving his independence or making the republicans happen. i think jay will want to do the right thing. the most important thing to remember z a backdrop here is the fed has missed its inflation target on the south side of 2% -- >> yes the mandate is jobs growth amid price stability. you've got both. >> paul, that raises the question about what's in train from the fed i want to put up a chart here that, folks, it's a piece of history today. for the first time the fed's reduction in its balance sheet
is showing up -- there it is, see that leg down, folks >> wow. >> that's the -- are you excited about that >> yes, i am >> $6 billion decline in the fed's treasury holdings. paul, you can't -- >> there's $6 for paul mccully dropping a penny on the streets -- >> this is going to ramp up, it's going to start to be more meaningful at $50 billion a month. now, paul, i know we got to go, is there too much triteeniighten train given the rate cuts and balance she reduction? then we got to go. >> you got to be cautious on any further increases from rates here while you're doing the delede le lefering of the fed's balance sheet. the fed needs to be very careful about doing both with aggression. >> got it, thank you, gentlemen. paul, steve liesman. >> more "power lunch" ahead. y d tt od
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i assume you buying them? >> the oil stocks, no, we're essentially neutral. we used to be overweight we cut that. the starngt hock market rallied in anticipation of a better economy. oil prices up $4 in the last year or so supply concerns are ahead. this point we're fairly neutral on the commodity and group. >> okay, phil, can we make money buying crude oil now or would you avoid it until it falls again if it falls again? >> no, crude oil's got a really interesting setup right now, a unique uone. saw the 50 day moving average cross over the 200 especial lir on the strong close today. opec, continuing to make production cuts, compliance at about 90% for the full length of the year if you look at the u.s. production, it peaked at the 9.5 million barrels per day. look at the rig county, 768 earlier in the year, we dropped down to 729 with another reduction today. i think oil futures break out above 56 i think that looks pretty good from a risk management strategy,
if question break below 52, i'd have to question a bull rally. >> there you go, thank you very much for more q"trading nation" go to our website, tradingnation.kr tradingnation.cnbc.com "check please" the last of the week next. now the latest from tradingnation.cnbc.com. >> daily price fluctuation of individual stocks can offer trading opportunities. if you're unhappy with your returns while trading actively, consider taking smaller positions over a greater investment timeframe evaluatining trends over multipe weeks rather than hours can help a trader latmooce re consistently tradeable trends while possibly trading less frequently
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check please. >> news breaking the last hour that perhaps broadcome thinking of buying qualcomm brin bring up questions of why the ceo was in the white house because of committee in foreign investment in the united states which can tell foreign companies, no, you can't buy things this is a 2015 report that only came out a few months ago. it was late. and they raised concerns about a foreign government trying to take over one of the key tech sectors in the united states this administration is very concerned about foreign takeovers. >> me thinks the timing of the two is very interesting. >> yes, i think you're exactly -- >> two things. liz ann saunders of schwab tweeted out a picture, i retweeted it
bullishness on stocks, all-time high watch out, i'm going to -- >> speaking of bitcoin -- >> i'm getting a little nervous. not nervous saturday night, my hokies defeat -- >> throws down the gauntlet. >> these two virginians. you know thanks for watching "power lunch. "closing bell" starts right now. hi, everybody, welcome to "the closing bell. i'm kelly evans at the new york stock exchange. >> i'm bill griffeth the end of a newsy week, a newsy day. breaking news this afternoon they were just talking about it. broadcom reportedly exploring a takeover of qualcomm it would be the largest ever global technology deal according to s&p global. we'll have more details on what type of deal this may look like if it were to happen. and according to rich peterson, the eighth biggest deal of all-time this is a mega, mega one