tv Power Lunch CNBC November 17, 2016 1:00pm-3:01pm EST
russell against the s&p, so the flows have been going there. >> ten seconds of cisco? >> it was all about the -- yes. >> guidance. >> it killed them once again. they always guide weekly. that's what they did. that was the issue. >> all right, you're looking at cisco share downs five and a third percent, but the market rs in positive territory. "power lunch" picks up the story right now. janet yellen channelling tom petty, saying she won't back down until her term is done. the latest on her tussle with congress straight ahead and the buyer beware segment. the real cost of the low cost etfs and oh, baby, details behind the best piece of video you're going to see all day. "power lunch" going viral right now.
jpmorgan agrees to pay 264 million to setting charges that it bribed chinese officials. the stock up about is%. weekly jobless claims falling to get this, 43-year lows. and apple has reportedly asked manufactures into looking into making iphones here in the u.s. a. hello and welcome. let's welcome in your co-pilot for the next hour. david winter. ceo of winter green fund, one of the world's east investors. if you like etf and index funds, listen up. they may bring interest regular sear why they may be more expennive.
janet yellen making big headline on capitol hill. steve liesman has that. >> seems like about a week ago, but this morning, we got good economic data. a little less inflation. that adding to the outlet for gdp. our rapid update, which brings together the forecast from the street, tacking estimates by .2. now, it's.6 we're tracking for the fourth quarter. early days, lots of data yet to come, but right now, we're running 2.6. 's look at who's -- goldman sachs running near 3% at 2.8. moody's analytics, which puts together the surveys, contributes at 2.1%. janet yellen as was sukt suggesy
the says she fully intended to serve out her term which ends in 2018 and warning about the fiscal stimulus plan. she warned about the inflationary impact of big stimuli, the same size not needed. warned about raising the gdp to debt rh owe. she suggested congress focus its fiscal policies on raising national productivity and said the fed in making policy will take account of these assessments of such a package. listen to what she said. >> such a package could have inflationary consequences that the fed would be to be, to take into the account before advising policy. >> that suggests that if there's a big package out of washington, could move faster.
quote, could be appropriate relatively soon. >> thanks so much. joe's sticking around with us here. from deutsche bank. chief u.s. economist and cnbc contributor along with david winter. joe, start with you. i chucked to see janet yellen. she's been pratt for inflation, right? >> she has, she's been saying that she has. she'll probably get it because my guess is president-elect trump is going to give us a lot of stimulus next year. and the fed could find itself in a tricky spot in late 1718. the economy does as well as i think, they'll be behind the curve. i've been very negative for a while and i really changed my view. >> as a result of the election perhaps? >> purely. absolutely. >> what do you think about this talk when it comes to being worried now about inflation for the first time and what it feels like forever. >> there's still a lot of capacity. as steve notes, to get yut. >> allison:ed, so how soon he
get inflation, we need higher rates. and -- >> on that point, all this talk about deficits and deficit spending. at some point, doesn't the bond market take care of that for you, when interest rates start to rise just like they did to bill clinton when he wanted to do single payer, they said, whoa, wait a minute, you want to boar rrow that much money? >> so, the bond market and markets themselves will make some kind of assessment as to whether or not there is increased growth. growth is not in and of itself, inflationary. one of the points yellen made this morning is that the economy is operating near full capacity. to drop a major stimulus plan on such an economy would potentially be inflationary and the bond market could take account of that. i think we're along way though. thevillagilanllaggilan vigilantees. i think the market would be able
to stomach that. >> where do you factor in interest rates in your thesis? you've got two things going on. inflaig and a euro dollar. about quarter of your investments are overseas. so, how does it change? zpl zbling the key thing is you have to have companies that are able to reprice their goods. they have to have pricing power and the ability to have as demand comes up, they have more units. >> the dollar certainly is a factor. it's rallied significantly in last ore the past few weeks. now, to your point about the bond market, bond yields will stay low in part because of the globalization of world economies and the fact that the fed is hiking and everyone else is easing, that will limit the amount rates can rise, but if you're going from a world where nominal growth is 2.5, 3% up to 6, pricing will improve. the problem with the fed, one of f the fiscal stimulus, they're
going to get it. they're going to be in a realtr position. if we're running at 3 to 4% gdp, the fed's going to be raep in a tough spot. >> i want to go on to yellen. does she throw down the gaunt a gauntlet? i'm staying. hey, doens touch me? >> let's not play that game is what she was saying. >> that's significant. >> yes and no. i mean, what was significant i thought was that donald trukroz that had never been crossed by presidential contenders before in making a political b football out of the federal reserve. >> that's what i was implying in my question. right. >> yeah. >> i would argue the fed though has brought a lot of this on itself with qe and forward rates and guidance. bernanke had a great quote, the fed, this is really and steve knows i'm pret thety critical of the fed.
the law of unintended consequences is going to bear down on policy. >> congress should have stepped back and did nothing and the fed should have just watched that happen. >> no, to me, the fed went in places it shouldn't have gone. >> right, so you're saying it would have been right for the fed to tank! no, the fed should have followed through, bernanke, we'll end tapering when unemployment gets the 7. they've lost credibility among many investors. >> but wouldn't you still be relieved, that there should be no, that the fed should be independent peptide? shensz i'm saying and trump should o not touch that. >> that's a world that doesn't exist. in theory, sure, you're right, but politics don't operate in a vacuum and when you do these policies, it happens globally, you've injected ourself. >> you saying she should resign? >> no. >> why? >> what i'm saying d the fed has
caused these problems. why would she? >> would it be bad if donald trump asked her to? >> no, i said the fed has effectively interjected themselves in the political discussion. this goes, this is problem is much bigger than yellen. this is bernanke really starting this whole thing. goes way back. it's even reducing the wlans sheet. now they've got this balance sheet and it's hard. >> joe, thank you very much. steve, thank you very much. you stick around. all right, now to stocks. in particular, the big cap tonl stocks because since the aforementioned mr. trump became president-elect, the big cap tech sector is really taking a beaten. nex flex, amazon, facebook, all down, but since tom petty seems to be today's theme, jaffray's saying down with torpedos, great
album, by the biggest of the big cap tech and joins us now to explain. how do you lump these names together and say buy the bunch? doesn't seem right. >> well, the comments that trump had were broader comments about the internet space and tech in general. that's how we can make this lump or basket type of a call. it's been consistent to sell off across the board. >> hey, gene, you know, these are the stocks that have driven the bull macht, the etf because the market weight owned them all. do you worry b about history? and the way that history has warked that you know, the tech bubble, the mortgage crisis, that these stocks that everybody owns are just overowned and overvalued and have fragile business models? >> well, we'd be worried if we didn't feel good about the
themes they're playing into and theech company is unique in terms of how they're playing into this, so i'm always concerned, i was an analyst during the bubble and learned a lot of lessons about not playing into the group theme. i think you can debate where apple plays out over the next few years. i think this is a great story to own for the next year because of low expectations are on the iphone 7. other companies like google, amazon and facebook, it's easier to dream about where they can go longer term. so we're not as concerned. >> i think in that question you're asking, when i read your note, you seem to think that the most of the reason for the sell off was concerns about donald trump, his protectionist talk, the tariffs in china, et cetera. when i saw the stocks sell off with the exception of apple, i
thought it was most ly because f higher interest rates. when they start to rise and a company has earnings that are way out in future and a lot more in doubt, they sell auffaroff. how do you capture that at this point? >> that maybe part of the reason for the sell off. and as we talk to investor, we've had a lot of questions and most of the questions have been directed about what trump's policies are as a campaign and what the companies have said. and so, we're basing our note today on some feedback we've had ore over the past week from investor, so yes, that may play into it, but i think there's just some concern ant trump's rhetoric on the campaign about being antiinnovation and that is pointed to by open letter that tech executives had written to donald trump the candidate on that topic and so, i think what you're talking akts, i think that also where investors feel
about the trump presidency has an impact on it, too. >> zbreen gene, it was a plrn to get you on. thank you. >> all right, speaking of technology. is air b and b planning to take on uber? it might be. that story straight ahead and big news from bio tech. criminal charges announced against two former executives, the case against valiant pharmaceuticals, what a u.s. attorney had to say and who might be going to prison. straight ahead. ♪jake reese, "day to feel alive"♪ ♪jake reese, "day to feel alive"♪
air b and b noout with big news today. you can read about it in "vanity fair." they have an in-depth story of the ceo and some of his biggest fans including warren buffett and jeff besos. an exclusive first look at the story. to "power lunch." the big news today is a big expansion of their product line. correct? what is it? >> they are going beyond their origins. this is the moment as when amazon went from selling books to efg else. if they pull it off, i think he sees himself and his company being catapulted beyond uber into sort of apple territory. this starts with a series of
trips around the world. the idea is for it to be a kind of trip that an airbnb traveler wants to experience. >> give us an example. sell us. >> running with marathoners in kenya. >> that's not good. one we want to do. going to drive alongside as they run. >> samurai sword lessons with a master in japan. surfing with pros in malibu. edgy, quirky, off beat trips. i spent some time in topanga with a tv righter and so, i think the idea for brian is he sees airbnb as going beyond into these other markets that take him up against!
you used the amazon comparison in the beginning. so jeff goes from selling book to some other thing and the whole world, first, it was music. that's outside your core of capacity. book rs so much easier. every single time he did something new criticizeded him. they're going from overnight stays to experiences. uber. >> well, so -- spent some time at airbnb and they showed me a story board. hired a pixar animator to mapout a story board in it, they only noticed two of the traveler at home and the rest was the traveler everywhere else. that in their minds, a trip should include transportation. airline tickets. eventually, entertainment, meals. so, what you're going is taking
this flat form, an unbelievable platform. i think now, 140 million people have used an airbnb. it's everywhere except syria. >> and new york. >> syria, north korea and new york city. new york city, if you're list listening, does he have a view on the idea that every is not one sided? it's nice we can go around the world. the last tango in paris apartment is available. but there's ood sign. the people who rent the spots. >> new york city has prohibited it. >> for any viewers who come and visit, it's $600 a night for the bedbug in. what is chesky's view on cities that are supposed to be progressive given they're
slamming people's ability to make any money? >> i think he thinks they are and they are in a major head to ted now with cities around the world. they are fighting tooth and nail to make sure this platform is going to be freely available to people. i think new york, new york is a tough one. i don't know new york is going to bend. this is, they're going head to head. he's hired one of bill clinton's adde advisers to formulate a strategy, chris le han is the adviser and he's modelled his strategy on president obama's
2012 campaign. about grass root, social media. cities have their own fights. >> it feels similar to the uber paddles wer seeing. great to have you on. thank you. >> well, new video coming into the cnbc news room. fedex, fred smith arriving at trump tower in manhattan. he did not speak to the cameras. later on this afternoon, president-elect trump is expected to meet with japanese prime manipulate abe. we'll keep you updated. still ahead, oh, baby. the stories behind two pieces of video you must see. a great catch and a big tumble. both straight ahead. this just in. 50 million customers' data was not compromised this morning in a security breach that didn't happen. wall street, not rattled... at all! no. sir, sir. what went right? everything. we have a brief statement on this non-breach. we're happy to report there's nothing to report.
my dad's company wasn't hacked today. cool. about tempur-pedic mattresses... my dad's company wasn't hacked today. is that they contour to your body. it keeps us comfortable and asleep at night. shop our biggest event of the year, including all tempur-pedic mattresses. save up to $600, now thru november 29th. get your tempur-pedic. the most highly recommended bed in america. i've got a nice long life ahead. big plans. so when i found out
medicare doesn't pay all my medical expenses, i got a medicare supplement insurance plan. [ male announcer ] if you're eligible for medicare, you may know it only covers about 80% of your part b medical expenses. the rest is up to you. call now and find out about an aarp medicare supplement insurance plan, insured by unitedhealthcare insurance company. like all standardized medicare supplement insurance plans, it could save you in out-of-pocket medical costs. call now to request your free decision guide. i've been with my doctor for 12 years. now i know i'll be able to stick with him. [ male announcer ] you'll be able to visit any doctor or hospital that accepts medicare patients. plus, there are no networks, and virtually no referrals needed. see why millions of people have already enrolled in the only medicare supplement insurance plans endorsed by aarp. don't wait. call now. anything worth pursuing hard work and a plan. at baird, we approach your wealth management
strategy the same way to create a financial plan built to last from generation to generation. we'll listen. we'll talk. we'll plan. baird. a baby is save today thanks foth quick thinking action of his older brother. mother left her 11-month-old on the dhang changing table for jaus a moment. tiny boy rolled over. that's when 9-year-old joseph swang into action catching him in the nick of time. my daughter has helped out, hasn't gone that far, but there is a strap that sthap straps the baby on to the changing table. >> you just don't think they're going to moou that fast. one split second, they get gassy, poo poo in there, they roll right over. >> i'm going to raise you a
great tumble. valerie sharp from huntsville, alabama, zlently put herself to bed. she told the story, the "today" show, she need as step stool, otherwise, she would have to drop the baby on to the mattress and then the baby would wake up. >> grandma goes -- >> can you try that? >> i don't think so. all right. still ahead, criminal charges filed in the case against valiant. the latest on who could have going to jail and what could be in store for the stock.
president-elect's intans that nato is a commitment that does not change and his full commitment to nato as the foundation for our international security i think is very important. >> back here at home, the u.s. surgeon general calling attention to the addiction epidemic. a new report finds one in seven americans will face drug or alcohol addiction in their lifetime, but only 10% of those now addicted receive treatment and it looks like benjamin franklin's grave will be envated. thanks in large part to a $5,000 donation by musician john bon jovi and his wife. then the nfl's philadelphia eagles also donated $1,000. that's the news update this hour. back to you. >> thank you very much. let's get a check on your markets.
all three major index rs hire, but very fractionally, folks. the dow is up about 8 points. david, you know you're a stock picker, you go after individual name, hold them for a long time. you held the proxy fight in the coca coca pay thing. do you have a macro view? >> i think you've had euphoria the last couple of years because of low rates. people have bought ten stocks and neglected almost everything else, so i think the big opportunity -- >> don't you like that? it's created a opportunity beyond the index, so we think the next big money that should be paid over the next many years will be not in the most popular securities. >> hit hard in the wake of the
election, that's because trump is talking about protection ism. if i can make 2, 3% in the treasury, that tech stock has got to perform way better than it has for it to justify ownership. >> i think you're right. you know, i think that rates play into this and that's why you've got own companies that have the ability not only to raise prices and reprice, but to be able to exist in this world of a lot of chaos. >> all right. speaking of companies that have chaos, share of valeant rebounding, following criminal charngs against two former executives. meg has the latest from boston. kate kelly is here with a look at some of the big money bets placed on valeant. >> k
zwl chaos is right and it comes down to the relationship with a pharmacy. the stock over the past year, the unraveling had a lot to do with phili dor. it seemed to help really woos the business of those drugs. a lot of charges about nefarious practices going on there. well, today, the u.s. district, u.s. attorney in the southern district of new york has levelled charges against two former employees. former executive and a former philador executive. four counts including wire fraud and money laundering, saying these two conspired to work together to benefit from the relationship with fiphilador. they don't look like they're charged valeant the company. take a list frn earlier today. >> did not do this out of loyalty to valeant. he did it because he was
expecting to get a secret $10 million kick back and as the complaint alleges, he concealed this deal, he lied claiming he had no personal financial interest when he had a huge interest. they had in effect converted money into their own personal nest eggs. >> the creator and former ce of. valeant says the company has not been charged. the former cfo, who there have been news reports maybe under investigation, have not been charged, nor have any current employees. they say the issue today included allegations that the charged parties to defraud as a company. they intend to cooperate with all authorities in this matter.
the stock rebounded today after being down because this doesn't look levelled at valiant, however, as david points out today, the company is still dealing with a dozen other investigations that may start to come to light more next year. >> don't move. let's bring in kate kelly. a lot of big names went long this stock. >> absolutely. this has become one of those stock that's become a hedge fund hotel. goldman sachs keeps a list of the long names and valeant has been toward the top of the list in recent quarters. pershing square, bill ackman's hedge fund. paulson and company and then value act, a san francisco based primarily long only hedge fund. they don't necessarily think of themselves as a hedge fund, but for purpss of this discussion, yes, and they have a seat on the board as does bill man. take a look at bill ackman's publicly traded stock. it's traded sort of intandem with valeant shares. it's less of a big factor now.
but you can kind of see the trajectory is similar. bill ackman has tried to character it as an extraordinary investment and surprising and badding situation from an investor standpoint, but he's down 18% year to date. i think for the bulls on valeant or rather than bull, maybe those names stuck in this stock for now, until things hopefully for them improve. this is is a situation that one quould charkts characterize -- rather than organic fraud. that may provide upside potential for the stock. >> the thing that's interesting about valeant, it was one of these crazy momentum stocks that everybody owned. they didn't like at valuation, governance and it blows up. >> i think they did. my sense of it was a little mf nuances. i don't disagree with bottom line. i think people were trusting
management, which was michael pearson, the former ceo and others to have good judgment because after all, this was a roll up strategy. sort of a tax arbitrage. a canada based company. they were making a number of acquisitions. the better way to do it according to some investors that i remember talking to was to say look, we respect michael pearson. he's had good judgment. he has a background at mckenzie, we think he can properly diligence these names and turn it into a leaner company. >> as a balance sheet guy, there should have been some warning. that if you look at a company like this and you say they've got a cat's whisker of the revenue going to rnd. >> that was a business model. that is a marketing machine. >> now, many say that was, would that have been a red flag? >> i looked at it and didn't get it. >> so, you did look at it. >> looked at enron, looks like a
lot of o the securities. >> what didn't you get? >> anything that does sere acquisition, raises prices, m h mashes all this stuff together and people think it's an instantaneous -- >> they were big stuff like crazy as well? >> anything i find that you can't really understand, you may not understand the magic of your computer, but you understand how it works. but any of these companies that become black boxes, i think are really -- >> that's an interesting investment lesson. should it be frlt amateurs out there watching and listening, should they be automatically worried of companies that make a lot of deals in rapid succession? >> yes, sir, i believe so. in ackman's case, too, he got into this partially or largely because he wanted to make a puchls of allergan. so he loaded up an allergan but was working with pearson at
valeant. legged into valeant pog as well, but his reason for being here was different. >> it can go up 20% a year for the next ten years and still be nowhere near its peek of just a year ago. >> right, but if you're these investors, you have no choice but to try. >> thank you. >> all right, now, let's talk about something that we've been pretty active on. which is fees in the market because here's the thing, david. and you pointed this out, we were in san diego, we saw you. a lot of our viewers and investors buy etfs and funds, low fees. you've done a lot of verge. exclusive stuff, and you say they may not be as cheap as we think. how come. >> it's like an iceberg and you have a low management free. delusion, equity plans. more of the plans are going to
sopping up these equity plans. it's about 4. is%. because of the way it works is that what goes up, they have to buy more of because the market value. what compounds the risk with etfs and index fund ss that 95% of the time, these index funds vote in favor of management. and so, the fees keep snowballing. and so, people own these index funds and e trtfs and they thin they're low risk and they're actually highly concentrated. that's where the returns have come from. they have these big and growing fees through the management costs of the companies. and we think that it's a little bit like valeant and other things. >> if i buy a bio tech etf, are you saying even as it climbs in value, am i owning less and lez
of the underlying stocks because so much of the money is going to fee sns. >> an e trtf or index funds own basket of securities and each one has a management fee in and of itself. what you have to pay the ceo, the cfo, the top five. that's been growing at a top rate. the whole idea of funds and etfs was a good idea, but 40 years ago, nobody thought this would happen. >> we said you led the charge against the coca-cola compensation plant. do you believe etfs and index funds make it easier to enrich themselves without anybody noticing or having power to change it? >> absolutely. they are enablers. here's a very good example. last summer, a group of self-declared 13 investor, big
investors and others, came out with these guidelines for corporate governance and when you really go through the guidelines, you realize it's somewhat self-serving and that you've got 13 investors who control 28% of the s&p, own about 25% of each other's securiti securities and in the last three years, their comp has gone up about 61% and the next four about 31%. they vote 95% of the time for these plans. we not only want a low management fee, but a low look through fee. >> interesting. companies that are honest that you like, not the valeants of the world that you're skeptical of. union pacific. why is this a value stock?
>> it's a cyclical, but one of the best run railroads in america. actually, north america. it's got excellent management and it's a land bridge. assuming we trade doesn't go away and that this great program the president-elect has proposed. the up with its six big commodity groups will be a big beneficia beneficiary. they keep driving down costs. it's an excellent company. >> extra coal. >> they coal, they're affected by coal, but they have intermodal, all the food stuffs and -- >> i ask in the wake of the donald trump election when there's all these hopes for coal. is that an added boost? >> i hope so. we'll see. that's a whole complicated, but yourngs they do move coal, powder river basin coal primarily, which is low sulphur. but we think union pacific is a
gem! two other name yous love and those will be spoken about later. got to keep people hanging on. >> a tease. >> thank you. >> go to check on the bond market. rick santelliy at the cme. >> yeah, we'll get to the first, maybe the second as well. listen. if i was to look at the market today, especially after some of the data points we've had i know that many want to have the twos going up faster because of all the fed implications. but the fed's behind the curve. matter of fact f the markets were a steam engine bellowing out smoke, the fed so far behind i don't think they can see any smoke in the guy. maybe it's just the beginning. i tell you what, got to really watch this 225 to 227 area. it could be the 260s, but i don't want to get ahead of the markets, 2727 is significant. i'm not going to go to the april
chart of '03. i'm going on a ten-year chart. i want the viewers to see the congestion. we are now blowing through over 100. this could start to get even more momentum. and as for the testimony today, wow. this was enlightening. so many metaphors and analogies, the emperor, his wardrobe, lack of wardrobe because in the end, it was this year that janet yellen and the fic company saw the light. they have been applying medicine for a cyclical scenario that they've stuck to through thick and then and they gave it up. it's strurk churl. now, we have a president dealing with the structural issues from the fiscal side that they've been begging for and she doesn't want to help them now. because they have a problem. and i think the way you address the kind of problem the fed's going to have is maybe you need to start talking about 50s. 50s. they need to ramp it up.
ben bernanke's post has come back to haunt him. they're looking at a death charge of activity and full employment and the unintended consequences of everything else, stay tuned. this is going to get sbresing. >> it's amazing how quickly the world can change. just one event. still ahead, there have been promises of deregulation on the campaign trial. what small business owners want to hear pr the president-elect on deregulation. that's next. ♪ ♪ ♪ is it a force of nature? or a sales event? the season of audi sales event is here.
we're drowning in information. where, in all of this, is the stuff that matters? the stakes are so high, your finances, your future. how do you solve this? you don't. you partner with a firm that advises governments and the fortune 500, and, can deliver insight person to person, on what matters to you. morgan stanley. president-elect trump talked about deregulation on the campaign endlessly. it's a top three issue for small business owners and they'd like to hear specifics. kate rogers is here with the story.
>> that's right. well deregulation is a welcome word on main street with president-elect trump making his way to the oval office. small business advocates are weighing in on what they'd like to see changed under his leadership. first up, obama care, which trump has criticized from day one, promising to repeal and replace the health care law while campaigning. >> the affordable care act is causing a lot of pain for our members in terms of the cost, the rising costs. cost were supposed to go down and not up. so, the surge in prices, the surge in costs and the lack of competition in the marketplace really does need to be addressed. >> we're very much advocates of getting rid of the employer manda mandate. the studies have shown that the mandate doesn't increase costs. >> another concern is the department of labor's rule can which kicks in on december 1st
that makes an additional 4 million salaried workers eligible for overtime pay,ing the pay threshold to $47,000 per year. another area of interest, the minimum wage, which trump supports at $10.00 an hour. they are not big on the minimum wage, but it's really a big concern. we talked about it on sidewalk box this morning. many of these companies play above the federal minimum. if raise it, they have the scale up more. >> thank you. david, before we let you go, we're going to free you early. you have two more picks. both in the same pace. altria, reynolds america, you love. reynolds america rejected it. the stock's 3 bucks below that. do you think a deal will be done? >> we hold the stock.
we love the company and applaud the board to try to work this through. we'll see. maybe we'll get a bump. maybe they'll change the structure and we'll get more stock, but it makes sense to put the family together and it will make an even more successful company in the long run. >> why do you lock tobacco in general? >> they have pricing power. they can raise dividend, so even if rates go up in a rising rate environment, these have gone up 8, 9, 10%. that will more than off set any risk of higher rates. >> didn't we see smoking rates start to decline because vaping? does that worry you? >> they're get ng this business, too. these are very well run companies. very short holder oriented. they have low look through expenses like we were talking about in the last secment in the show. they're shareholder oriented. in an uncertain world, people are bullish this week, might be
bearish next week, but we love these businesses that rely on repeat human behavior. >> hopefully, we crepeat your h behavior. it's been a pleasure. handshake, called me sir, you're welcome back every day. thank you. on deck. four stocks in focus today. your daily dose of street talk straight ahead. why pause to take a pill? or stop to find a bathroom? cialis for daily use is approved to treat both erectile dysfunction and the urinary symptoms of bph, like needing to go frequently, day or night. tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. do not take cialis if you take nitrates for chest pain, or adempas for pulmonary hypertension, as it may cause an unsafe drop in blood pressure. do not drink alcohol in excess. side effects may include headache, upset stomach, delayed backache or muscle ache. to avoid long-term injury, get medical help right away for an erection lasting more than four hours. if you have any sudden decrease or loss in hearing or vision,
or any symptoms of an allergic reaction, stop taking cialis and get medical help right away. ask your doctor about cialis and a $200 savings card. the markets change... at t. rowe price... our disciplined approach remains. global markets may be uncertain... but you can feel confident in our investment experience around the world. call us or your advisor... t. rowe price. invest with confidence.
we were talking tax policy, dodd frank, a trade that was a wonderful conversation and i stand ready to help the presidents in any capacity b possible. i've got a great position in public policy today. if he wants to talk to me obviously about serving somewhere else, we'll look at serving somewhere else, but regard willless, i'm on his team, i'm excited for what he can do for america and it was just a real honor to be here. >> that was jeb hen serling stopstepping out from a meeting with donald trump and he was clearly answering the question are you going to be the treasury secretary. >> there's a hint of seriousness to it, i wonder if delta
earnings are going to bet a pop because all these big whigs and their staffs are flying up on a shutting to pay homage. >> if they can get down the street because it's blocked off most of the time. >> let's get to street talk. >> gugenheim cut chipoltle. the firm is not as optimistic as some other analysts citing intense competition. their price target is $315. i think everyone else is too optimistic b about a steepening sales curve. jack in the box stocks up 45%. we'll see m second stock is alliance data systems. security starts coverage of the company, the buy rating, a $238 target. the biggest company monitoring and tracking data, spending habits, et cetera, credit cards.
the companies that know everything about you. the stock is down 25%, but they think the company is quote nearing an inflection point in sales. especially its epsilon division. a $238 target. >> third stock is range resources. upgrading it to outperform. analyst is more optic on this oil producer, price target is $44 a share. $10 higher than where you see it now. there's been a lot of csol documentation. i wonder if there are going to be a lot of downgrades. finally, your smaller cap call. atlas air worldwide based in westchester company new york. neerk, 747s, whatever. imperial cap pal, they call it a global leader in air freight with a strong fleet. they bought a competitor, i didn't know, this is amazing. they have a deal with am son
that gives amazon the option, but not the onbligation to buy 30% of the company. amazon has an option to buy 30% of aaww. alice air worldwide. an $80 target. $60. that's b about 20% upside. >> cool. still ahead, nfl ratings are on the rebound. how do they keep the momentum going? ahead of the nfl network is going to join us and weigh in. still ahead. don't move.
welcome, everybody. i'm brian sullivan with michelle caruso-cabrera. just two hours until the closing bell. stocks are higher, a little bit. the s&p 500 on pace to close at a more than two month high. nasdaq on track to close at a five week high. small cap, mid and in between caps all hits record highs again. the russell 2000 is up for a fent straight session. >> western refining. it's up more than 20%. the oil refiner being bought by
sorrow for about $4 billion. upgraded wnr two days ago. brian flagged that call on street talk that day. cisco systems down more than 5 a% after giving a weak outlook and best buy soaring 11%. news alert on valeant as well. let's get to sue herera. >> thanks very much. as you know, gary tanner, a former executive valeant pharmaceutical was charged this morning by the u.s. state's attorney of the southern district of new york of engaging in a multi-million dollar fraud and kick back scheme. we saw that news conference live. now, his tone is speaking out obviously in his defense. and we have a statement. he says quote, it was gary tanner's job b at valei can't to grow and promote philadrk or. he performed that job well what he was doing. today, he has been charged with
a crime for doing his job. we will demonstrate his innocence at trial. so, basically say iing that his sue per yors knew what was happening at the firm and he was just performing his job. we'll fipd out at trial. brian, back to you. zwl thank you very much. also happening now, tesla and solarcity are holding meetings to vote on their merger. both stocks trader higher, but probably cold comfort for tesla investors. phil is in chicago with more. >> the expectation if you listen to people whosk track iing this closely, the expectation is that this marcher is going to be improving by shareholders for both companies. here's what this merger would mean and essentially what's happening for solarcity shareholders. they'll get .111 tesla shares for each share of solarcity. as the stocks have fallen back, that value may come back.
elon musk is abstaining from the shareholder vote, but all along, he has been saying look, in is a no brainer, putting these two companies together. he likes the fact they'll have synergies when it comes to product offerings. efg from solar roofs down to energy storage units that will be in the homes to electric vehicles that will be manufactured by tesla. basically, a triple play. take a look at shares of tesla and solarcity. again, the vote is happening w now. there's a web cast at h 4-krk and we expect shortly after 4:00, somewhere between 4:00 and 4:30, we'll get the results of that vote. back to you. >> thank you very much. so, how should investors handle this deal or should they handle this at all? long time bear on the solar stock, most of them any way, recently downgrading his solar sector to a market underweight.
so, just work through the me can ibs, gordon, if you can. say the deal gets done. solarcity stock goes away. what does that mean for the people who may own it right snou? should they hold it? why you recommending selling it when they're probably going to get bought. >> if you look at the ratio, .11 times for each tesla share. the upside now is roughly 2%. and if this deal does not close, which we think the deal is absurd. the downside is significant down to $6 per share, so risk rebass, you're upside 2%, downside the significant. we think you know, you play the down scenario? >> why. >> because solarcity has burnt free cash throw. tesla is a car company. a very old industry. solarcity is a solar company.
solarcity, the benefit is net metering. net meters is their business. nevada ended net metering, cut it and a left the state. tesla claiming they're going to essentially bring in battery technology and mirror that with solar technology. you're bringing battery technology, you're saying you should store the power in batteries versus in the grid, which net metering does, so the whole premise and basis of solarcity's business if they're acquired by tesla, goes away, so we think the deal doesn't make any sense from that perspective and from a cash flow perspective. >> ron barren love it is stock because he says thai going to sell, be making 7 to $8 billion a year net profit by 2020 because they're going to be selling so many cars. >> well, you're talking about tesla. zpl exactly. they have a number of issues ch one, they have a bunch of other companies, bmw. audi. porsche and a number of others introducing electric vehicles. number two, you have president
trump who says he's going to reduce support for a lot of alternative energy products. tesla promised they're going buy back cars they leased out. and the residual values are coming down, so we think there's a number of issues. >> appreciate your insight. got breaking news in d.c. thank you very much. mike pence and nancy pelosi are meeting right now. >> we are working briskly in the transition, but part of the transition is also making plans. for the first 100 days. at the direction of the president-elect, i'm meeting today not only with leader pelosi, but with leader schumer. and with speaker ryan. and senator mcconnell and we're beginning to discuss areas that we might move forward on
together. and that's what the american people want us to do. is find ways to revive our economy. improve american lives, enhance the security of this nation an i'm grateful to begin those discussions on behalf of the president-elect with you today. >> let me just say that as you can hear from and as you know, vice president elect's leadership, i said to him when i spoke to him last week, you're going to be a very valued player in all of this because you know the territory. and with no disrespect to the sensitivity and knowledge of the president-elect, you know the territory, so in that territory, we will try to find our common ground where we can and of course, stand our ground when we can. thank you all very much. >> since mr. pence is running the transition -- >> mike pence along with nps, although questions about that right now, she's facing
potential election in the house. that wasn't the warmest. we'll try to find common ground if we can. >> seemed like she -- remembered his name. the vice president-elect. >> it's been a tiring couple of weeks. >> it's going to be, everybody hasn't slept for two weeks. >> let's now bring in a tesla shareholder who voted in favor of the tesla solarcity merger. on the line is rob lutz, president and cio with cabot wealth management. assume you heard the analyst on solarcity who said he hated the deal. you voted for it. why? >> we buy in the vision that elon mus has set out. we think solar power should be generated electricity for power in the future and putting these two things together down the road is really going to seem like a good idea.
we think in a year from now, they'll be making 8,000 cars a week and this financial decision will seem like a very small one. longer term, he's prove b b he's got to vision to see what the american people want. now, name me a company that's had 400,000 people who's put $1,000 down to reserve a car two years before it's made. this is what the american people want. i'm voting for it because i believe it's the right thing for both companies. >> clearly, a lot of people love teslas. people putting down money when they condition get the car yet. how long though, that vision you outlined where solar power eventually ends up being able to power cars, how long does that take? >> so, it's very difficult to know exactly. however, as the technology is available today, the cost of the storing of the battery, the power in the battery is a little
bit costly today. but i think the big battery factory is clearly going to drive the cost of that down. so, i have confidence that longer term, people will pay the environmental green and i think they will love to be able to drive into their garage, not stop at gas stations and just simply plug into their solar system on the roof and i think i own two solar systems myself, it's a viable technology. when you get a little bit of federal incentive and state incentive, it really works well. >> i don't know if those are sticking around. that's the whole question when it comes to donald trump and what he's thinking about energy policy. >> i think the american people want to have green technology succeed and i don't think he's going back away p completely. some backs away, the federal, they're going to be in for some time. i think it's a moving train down
the track and musk is ready to bring it home. >> thank you, rob. investor optimism jumping post lech. the dow up almost 3% since november 9th and a new survey today shows that investor bullishness has risen to the highest level in 21 months. joining us is charles, vice president editor at the american association of individual investors. good to have you here, charles. >> thank you for having me. sx >> you started surveying people two days after the election until yesterday. >> we have to go back really two weeks. it's up 23 percentage point. we surveyed people, thursday through wednesday. send out reminder e-mails on wednesday. the monday before the election, we had a large number of respondents, so if you take
thursday through monday, about 80% of the people last week voted during that period. huge, about 15-point jump in sentiment, then post election, saw that upward trend continue. the start, preelection, but continued in the seven, nine days past election. >> does that mean they like donald trump? >> you know, it's mix. this week, we always ask a special question and this week, i specifically asked what factors are driving the momentum. sorry, what factors are driving sentiments towards the markets. over 50% said donald trump. about 22% said they were favorable about trump, about 26% said they're uncertain or didn't indicate a bias and pef 5% who were not happy at all. so i think there's a lot of political leanings and uncertainty about what he'll do during his first 00 days. >> how correlated are your result to market performance? when you see investor
bullishness rise like you've seen, does that mean the stock market goes higher? >> typically what we've seen the that our sentiment tends to be contrarian indicator, so when wie see low levels of optimism, which we have seen throughout most of this year, that tends to be follows by higher than average market returns. when you start seeing high levels of optimism, that's more bearish. what's interesting, i want to look at historical data. we've had about 13 other o occurrences where we've had a big jump in optimism. they tend to be above average. one was march 19th. 2009. >> you mentioned the 50% level. now, it stands at 46.7.
>> great. thanks so much. >> my pleasure. >> from a macro market perspective, the dow is flat right now. up a little bit, down a little bit, but there are two big stocks that you know on the move. cisco and walmart both moving down. walmart misses on sales last quarter. here's the question. is something wrong with the world's biggest retailer? courtney reagan up with that story. we're putting away acorns. you know, to show the importance of saving for the future. so you're sort of like a spokes person? more of a spokes metaphor. get organized at voya.com.
sometino big deal.shing my gums bleed. but my hygienist said, it is a big deal. go pro with crest pro health gum protection. it helps prevent gum bleeding by targeting harmful bacteria on your gums. left untreated, these symptoms could lead to more serious problems including tooth loss. gum crisis averted.
walmart shares, second bigs lose ner dow. >> so, wall beat by two cents. the world's largest retailer did raise the lower end of its full year guidance, so a mixed quarter, comp sales up 1.2%. pretty good, but it was shy of analyst expectations and like traffic, slower growth rate than what we saw last quarter. now, when i spoke to the cfo, he said performance was pretty consistent across categories so the retailer is quote continuing its story of transforming the business from a position strength. the retarial did need to show better growth online and it did with some help of the acquisition. e commerce comps grew 26%. that includes several weeks and chinese marketplaces.
that's the comparable number we would like at over time, but without those sales or better online of 28.6%, so there's some good, there's some bad. deflation is a bit of an issue in the sale, but walmart was full steam ahead on the holiday. that's what hatters here. >> we got a scale here. >> let's take a deeper drive. let's bring in chris for retail headlines. top-ranked analysts by institutional investor. you heard courtney. some good, some bad. how do we balance it out? is it a good stock for our viewers to own now? >> we're a neutral rated on the shares. i think it gets tougher as you look into 2017. i think the key message is we are investing for the long-tein so we care about you
shareholder, but the 50 years much more. zpl this is courtney. do you see a problem with food deflation going forward in that grocery business? it's been persistent. is it going get worse, better, stay the same? >> it deteriorated se quequenti the past three months. we look at commodity prices and expect this to be its low point and then start to get less worst to more of a disinflation. as you look at the late. if you have food deflation, does that mean they're losing money on it or that they can lower prices and maintain the margin? >> gross margin goes up and you see that. gross margin beat for the wall mrt u.s. segment. i thought the margin b, u yo get
a little bit of benefit. >> what about the holiday season? when we look at wall mrt and that's what everyone is focused on today. wall mrt included going forward. you look at what they're doing on black friday and thanksgiving. it's similar, a little bit from last year. is it going to be enough to excite consumers? >> you know, christmas is already started. i think if you just look at your inbox, you see black friday pricing e-mails started about a week ago. there is no more black friday. it's black november. i think right now, the consumer is a little soft. relucta reluctant. i'm expecting a relatively modest christmas. there's always wintners and losers. inventories are generally clean around retail. fand we get some cold weather, you're going to see whether sensitive retarials see lift. >> quickly. single best retail stock you cover that our investors should own is? >> i think you've got look at
names where you're going to see accelerating comp growth into next year. advanced auto parts an tall koz met ices. >> makeup and air filters, baby. walmart sells those, too. >> david winters recommending union pacific. authorizing another buyback and raising dividend by 10%. >> got lucky on that one. we knew. >> no, we didn't. sue with the news alert. >> thank you very much. b nbc news confirming from a senior republican source that governor mitt romney will be meeting this weekend with president-elect donald trump. don't know whether they are going meet in bedford, new york or in new york city at trump tower. but at this point, we do know that the two will meet over the weekend. interesting development given the harsh criticism and statements that mr. romney had
towards then candidate donald trump. we'll keep you posted on this one. back to you. >> wow. would you like to be a fly on the wall in that meeting? mitt romney and donald trump? mitt romney has made more than one speech just endlessly criticizing donald trump. holy smokes. >> it's even more interesting because romney's not in government. he has nothing to gain. you understand he's minority and majority leader rs coming up because they may need something. >> or want a position in the government. >> it doesn't mean he would get a cabinet position or position in the government, but to your point, he's not hindered by a government role right now. maybe they're just mending fences. >> i think if you're mitt romney and you took a very strong stand and guess what, you're in the wilderness now. donald trump won. he smoked you. you try to -- you made a speech criticize l him and donald trump's rates went up after his
first speech, so i think if you want to be involved in the republican party in any way for the next four year, wrouf got to go in there and -- >> mend those fences. >> sue, i need to correct you because the only fences on fifth avenue are iron barriers around trump tower. >> get a blow torch and -- i don't know. you know what i met. >> thank you very much. it is interesting because he doesn't, you wonder, the only reason that romney, you could think of and again, just talking here, folks. is to maybe mend fends or maybe trump floated something. wouldn't you listen? >> i would take meet, but part of it would be to see him eat crow. >> some of these avant garde restaurants, they may offer that. coming up, shipping, stock, hysteria and a big repinder,
invest with caution. with a name like smucker, it's got dob good, right in we'll get you out of a jam. right after this. >> oh, no. siness be ready when growth presents itself? american express open cards can help you take on a new job, or fill a big order or expand your office and take on whatever comes next. find out how american express cards and services can help prepare you for growth at open.com.
time for the good, the bad and ugly. profits beat estimates and improved guidance. to the bad. jm smucker off 3%. a decline in sales, especially for peanut butter? is that possible? coffee. not possible. i guess it's happening though. consumers are shifting away from packaged goods toward fresher items and it's an ugly day for first solar. going to cut 27% of the workforce in its forecast for 2017 coming in well below what the street is looking for. remember earmarks? those are spending projects, tacked on to bills by congress? they're banned, but some want to bring them back. some people think government is actually better with earmarks. how is that possible? debate coming up.
down. james clapper submitting his resignation to the house committee on intelligence. that's effective january 20th. paul ryan says a meeting between gop leaders and mike pence was warm and productive. >> this morning, house republicans met with vice president-elect mike pence. just saying that. he gave our members on an update. it was a warm and very productivity conversation. >> the new york times says in the week after lech day, it had a net increase of 41,000 paid subscriptions, the largest since the first week of the digital pay model in 2011. it said raerds came to the paper in record numbers for coverage of the 2016 election results. and heiss man trophy winning quarterback johnny manziel has reached a deal with prosecutors for the conditional dismissal of an assault case. you're up to date. back to you.
>> thanks so much. vice president-elect mike pence meeting with senator chuck schumer on capitol hill. we got that video? >> yeah. yeah. >> no, we're not, we're going to have a nice conversation. >> thanks, everybody. >> thank you. >> thank you. >> let's go. >> it didn't sound nice. very short. >> that was a great sound bilt. >> we're going to have a nice conversation. there you go. time for a blast from the past that may make you cringe. earmarks. the old d.c. practice of assigning specific money to a specific type of spending. often on o some kind of pork project for a powerful congressman or senator. they've been banned for year, but now, there's a push to bring them back. hampton pearson from d.c. with more on this. >> well, house speaker ryan in his earlier meet wg pence said their meetinging was focused on
how to get a unified republican approach to governing, so hit the ground running and move the trump agenda. and yes, one among the options being talked about is a possible limited return of earmarks. ryan says it's all going to be about the idea of how to restore one of congress' power of over the person, gain back some of the authority they think is is executive branch has seized in recent years. here's how he put it when i asked him about it earlier today. >> our members are worried that the executive branch bure cat krass have been given too much power. when we say drain the swamp, that means stop giving all this power to unelected people and restore the constitution. that's what this debate is about. . >> now, there's push back from other conservative groups saying this is absolutely the wrong message to send. it's a return to the days of back room deals and the old
business as usual in washington that so many, this millions of voters have just -- we don't know what president-elect donald trump feels about congressal earmarks. >> we'll b probably find out. thanks, hampton. the return of earmarks. horrific or a necessary evil? rachel is against the return. jason joins us, founder and president of the bipartisan policy center and wrote bring back earmarks. he argues quote, the elimination of earmarks have antized the process to a virtual standstill. going start with you because you have the contrarian position to consensus. when i read your open eop-ed, i boils down that without chits to trade, nothing gets done. you want a hard piece of legislation that isn't popular
to be put there. it really helps if a senator can go back to county sapd say i got the museum built. is that snit. >> there are a couple of issues. i would start where speaker ryan r started, restore iing the constitution. the fundamental design is to balance ploek interests and national interests. having taken away the capacity of member of congress to address their local concern, it should not surprise us that we are not able to deal with our anticompetitive tax system, our need for new infrastructure, our need to address entie lment reform. >> if you have those earmark, it would be easier to get those deals done. >> it's supposed to work. this hyper sensitive notion we should never allow members of congress to deal. it's a big reason the government isn't working today.
>> you just roll your eyes at them. the kao poacowboy poaching muse. all kinds of museum, nobody's really sure anybody wants because of earmarks, right? >> that's right and only in washington, d.c. would we hear the argument that to bring consensus back to washington, the answer is back room deals. earmarks are an unak steptabcce waste of money. weave seen a skent decrease in spending because of that. more than that, they contribute to these massive bills. we're going to allow federal bureaucrats and elected politicians to sit in the back room and trade away favor sns. >> but speaker rain, what he was saying about the issue of separation of powers, taking it away. the spending power away and instead, giving it back to members of congress. is that an important institutional concept? >> there's one way that congress can reassert itself over the executive branch.
by writing better bills. they don't like what the agencies do with the money they appropriateuate, they need to write better bills. these bills are so big that agencies are allowed to take this money. congress has two tools. earmarks are not the answer. >> i think rachel is looking at self-created windows and a theory that doesn't apply to the real world. we're not talking about going back to the battle days of secret thing being tucked into legislation. that was a problem. congress addressed that in 2010. what is being proposed is no earmark can increase the budget or be put forward without it first going through the committee process, without the offer sponsor being required to post it on their website, on a conscious webbgressional websit. if they are bringing up cowboy museums and bridges to nowhere, i have every faith that heritage action will be out there
highlighting the issue. this is not about creating a system that's silly and complaining. >> here at cnbc, we miss pork barrel watch. we used to do it all the time. had a pig that would oink. got to go. appreciate it. we'll see how this plays out. >> thank you. >> nfl ratings e rebounding. a little bit, so are the well publicized troubles of the nfl over or overblown? peter king coming up. day, we'rew technologies make healthcare more personal with patient-centric, digital innovations; from self-monitoring devices that can interpret personal data and enable targeted care, to cloud platforms that invite providers to collaborate with the patients they serve. that's why over 90% of the top 25 global pharmaceutical companies are turning to cognizant. our domain experts, technologists, digital and data specialists, clinicians and scientists
are transforming the way clinical research sites collaborate with pharmaceutical companies, and enhancing patient engagement with innovative platforms and solutions. our population's growing healthcare needs present growing opportunities for our clients: to advance the future of medicine with digital, and improve the quality of lives. ♪
♪jake reese, "day to feel alive"♪ ♪jake reese, "day to feel alive"♪ ♪jake reese, "day to feel alive"♪ hthis bad boy is a mobile trading desk so that i can take my trading platform wherever i go. you know that thinkorswim seamlessly syncs across all your devices, right? oh, so my custom studies will go with me? anywhere you want to go! the market's hot! sync your platform on any device with thinkorswim. only at td ameritrade
today on trading nation, we go small, look at the small cap stock sector. jonathan with mkm partner, jonathan, first you and the charts. russell 2,000. chart it. tell us where you think the small caps are going to go. >> there's two different issues. one is the short-term. we're up ten days in a row on the russell 200. about 7% above the 50-day moving avr average. that can happen through a price pullback or through a timed sideways consolidation. so that's probably the call for the next say one to two week, but if we're look iing at the
bigger picture we saw 25% make a two week high. that's highest reading for a 52 week. we're basically flat on the last two, two and a half years for the russell. we've just gone through a bear market. that's important for investors to recognize. just starting to emerge and then the third point is really probably the most important. it's how is the small, how are the small caps performing relative to the large caps. they've been underperformers for the last three years and just r start iing to break the trend. over the next six, 12 month, they probably outperform the larnl caps as well. >> dennis, you agri with
jonathan's view? small caps will outperform in the next half year? zpl i agree with his technical views. they should outperform in the next year, one of the thing that's interesting to me if you take one thing out of the segment two wards is i always like to say chess masters. the funds that were in the russell stocks, the small cap stock, they woke up i guess after the election and said 17% of their revenues come from outside of the u.s. so, 17% of the revenues outside of the u.s. in a trump election, we need to change our models and reallocate more to the russell. that's why we've seen the massive move in the russell. dennis and onnan with a look tat small cap stock, thank you very much. and we do two additional segment, xwrouf got to go on
the prior year and down 12% from 2014. but sunday night's patriots seahawks game on b nbc saw a ratings rebound up 16% versus last year. and the sunday cowboys steelers game on fox drew the highest ratings for any nfl game this season, so now, we're watch tog see whether tonight's game on nbc will continue the rebound u. in addition to the election distracting viewers, there are other factors at play such as thursday night games streaming on twitter. the strength of the match-ups, the residual effect of off field issues such deglat gate and domestic abuse. joining us is the ceo of the nfl network. brian, thanks so much for joining us. with this past weekend's rebound, dupg the declines are behind you? >> i don't know if they're behund us or not. ik the first part of the season has been challenging. i think you quoted some of those numbers in the set up here.
i think we had a great week last week and we'll see with the rest of the season, i think we as i mentioned before publicly, we've seen a lot of this in election years. in fact, we've been down in ratings in every election year since the early '90s. we didn't expect this to be any different. but there are other factors at play as well. i think you see we are feeling some of the -- they have not been as competitive as they would like with other game windows. i think we'll see. we hope we rebound. sunday was encouraging. we're urn certain at this point. >> nielsen said that espn lost over 600,000 subscribers in october. how concerned are you about cord cutting or shaving? >> i think it's something that's been going on for a while. and i think we're going to see it accelerated here in the next year or two.
while real other competitors come in the marketplace. sling's already there. sony. you're going see youtube do something as well as others. i think it's going to accelerate because of having said that, i think we feel pretty good being in the sports business, where we think sports is the one thing regardless of the distribution landscape still seems to aggregate audiences most efficiently. but we do think that the paid tv universe is going to go through some significant changes over the next few years. >> you know, sports and the nfl in particular have always been considered the gold standard, the key thing holding that tv bundle together. the ratings declines we saw this fall were really starting to question that. and some people are wondering if there's just too much football on tv. are you considering pulling back to maintain its appeal? >> well, it's something we actually, julia, look at every year. the nfl has benefited for a lot
of factors. one of those is being the relative scarcity value we have of our product. we're always balancing what we hear from fans, which is, they want more football, but we're also balancing that, when is there a saturation point? we have not seen it. and if we do, we'll certainly make adjustments, but it's the questions we keep asking ourselves, do we have too many windows out there. we also ask ourselves about, in this world, where the consumer is conditioned to no commercials on netflix or a 15-second preview on youtube, how is the pace of our game? are there too many commercials? are the commercials too long? are we taking too much time to review controversial plays that add to the length and the pace of the game? so we're looking at all of these, but that's not new. we really do that every year, julia, and maybe this year we might be looking at it doubly hard, but this is something that's standard operating procedure for us. >> well, brian, unfortunately, we're out of time, but thank you so much for joining us. we look forward to seeing what
happens with ratings tonight and over the rest of the season. thanks so much. guys, back over to you. >> thank you. our friends over at vox broke down an nfl game and found that less than 10% of the game is actually game. the rest is everything from replays, halftime commercials, and lots of standing around during plays. we knew that, hey, peter, great to see you. i'm a big fan and enjoy listening to you all over the place. this whole, the games are too slow thing. with all due respect to vox, that's out there. that's not anything new. people point to bad games, the election, baseball is strong, is there one thing you can point to as being the problem from the beginning of the year? >> i think brian is right. i had him on my podcast this week and we talked a lot about this. the simple fact is, the election cycles in 2012 going back to 1996, those were down only 2 to 9% in those five election periods. and this year, going into this past weekend, the first weekend
post-election, they were down between 15 and 18% on the networks. and so, i really think that that is the biggest deal but i also think this. the nfl has always had this sort of scarcity of product that helped them so much. and more recently, with the advent of thursday night football, through the entire season and with the advent of early sunday window games, from london, three of them this year. you wake up on sunday morning in the east coast and you say, there's going to be football on for the next 14 hours. and at some point, i think the nfl, and rolapp said it to me on my podcast, he said, trees are not meant to grow to the sky. so i think that the nfl needs to take a good, hard look at scarcity of product. >> and in addition to that, peter. and we can bring up this wall graphic that brian highlighted at the beginning. he also said, you know, on netflix, no commercials. you buy something on appletv, no
commercials. and then look at the anatomy of the nfl broadcast. 24% of the time is commercials, 10% replays. 35% of the time, the players are standing around between plays, and the actual time played is only 8%. they can change the rules. they do it every year. can't they do something to make the game faster and better? >> i believe so. i believe that the nfl right now, i mean, brian referred to it, and i think he's absolutely right, internally, on park avenue, right now, the nfl is seriously considering what to do with these commercial slots that they have. i mean, in a game right now, there are 64 30-second spots, in essence. and i think what annoys viewers the most is when you have a touchdown in a game, not that the touchdown annoys you, but you have a commercial, a commercial break, you know, four spots, i think, there. then they come back and have the kickoff, and then have another four spots. and i think the nfl needs to
look at alienating viewers, making spots shorter and also making them not come in such a concentrated fashion. >> is the red zone a good or bad thing for football, peter? >> that is a fantastic question. on my podcast, rolapp told me that approximately 1 million viewers per week watch "the red zone." i love "the red zone." it's utterly fantastic. from 1:00 to 8:00 on sundays, you can watch the best of every game that's on. so that if you don't have necessarily your team playing in that window, you're going to watch "the red zone." it isn't rated as a normal television station or cable station, because it's only on for 8 ours, 17 days a year. >> and i don't know the guy, but scott hanson has the hardest job in the world. he does like eight hours for no commercial. so, you're fantastic. i've never met the dude, but he
has a very difficult job. >> and i think the nfl needs to monetize "the red zone." listen to me, telling the nfl how to make money. but i think nfl needs to monetize "the red zone" better or try to make it more a part of the sunday telecast window. >> i've always snickered at the soccer games where they squeeze all the commercials into the halftime and never stop play. should we start thinking about that? >> or start thinking about having a longer break between quarters, maybe, and maybe only one commercial break in the quarters themselves. but i do think they have to do something. because right now the game is just too stutter and stop. >> a lot of penalties out there, too. peter king, it was a real pleasure. tell your buddy, i met him a few years ago and i'm a big fan. >> will o do. >> thanks, peter king. if you would like to hear more of peter king's thoughts, you can check out his monday morning
quarterback podcast. make sure to tune in tonight, by the way. the new orleans saints head to charlotte to take on the carolina panthers. that is 7:30.eastern time on nbc. check, please, is next. this is my retirement. retiring retired tires. and i never get tired of it. are you entirely prepared to retire? plan your never tiring retiring retired tires retirement with e*trade. i'm in vests and as a vested investor in vests i invest with e*trade, where investors can investigate and invest in vests... or not in vests. sign up at etrade.com and get up to six hundred dollars.
what's critical thinking like? a basketball costs $14. what's team spirit worth? (cheers) what's it worth to talk to your mom? what's the value of a walk in the woods? the value of capital is to create, not just wealth, but things that matter. morgan stanley why pause a spontaneous moment? cialis for daily use treats ed and the urinary symptoms of bph. tell your doctor about your medicines, and ask if your heart is healthy enough for sex. do not take cialis if you take nitrates for chest pain, or adempas® for pulmonary hypertension, as this may cause an unsafe drop in blood pressure. do not drink alcohol in excess. to avoid long-term injury, get medical help right away for an erection lasting more than four hours. if you have a sudden decrease or loss of hearing or vision, or an allergic reaction, stop taking cialis and get medical help right away.
ask your doctor about cialis. ♪ we love knowing what's happening. so the nest cam security camera looks after things and alerts your phone if something's up. hey, need a glass? no matter what it is. hey, dad. ♪ check, please. >> here's my check, please. the mexico tennessee peso just about an hour ago, the central
bank of mexico raised interest rates by 50 basis points. didn't help. the dollar is still stronger against the mexican peso. this is all in the wake of the election and fears about donald trump. >> oakland raiders, 112 penalties or so so far this year. the refs are becoming too much a part of the game, slowing the whole thing down. >> right. thanks for watching "power lunch". >> no fouls on "closing bell". it starts right now. >> hi, everybody. welcome to the "closing bell." i'm kelly evans at the new york stock exchange. >> yes, this is the foul-free zone. that's for sure. i'm bill griffeth. we are on trump tower watch again today. the ceo of fedex and south carolina governor nikki haley just a few of the people who have been meeting with the president-elect today. we have japan's prime minister, shinzo abe, expected there at trump tower in just a couple of hours. we'll take you there live for the very latest.