tv Power Lunch CNBC May 23, 2018 1:00pm-3:00pm EDT
i like to put my money where my mouth is i'm behind this name i have been out of it and it is a great spree point after lowered expectations from last quarter. >> good year gt, bought it during the show. >> target. great opportunity, i bought more. >> big shock. >> digital everything is killing it. >> does it for us. power starts now i'm melissa lee here's what's on the menu the wall of worry growing the trade troops unable to keep the rally going. is it time to redisk. shares of ge slammed after comments about the ceo's company outlook. and tiffany's sparkle target tumbles and git giddy up ralph lauren the retail detail on their earnings as "power lunch" starts right now. welcome to "power lunch. i'm michelle caruso-cabrera, stocks are sliding today testimony dow is down almost 170 points at its low.
it's do you dipping in and out of negative territory for the year spotlight is retail. lowe's is soaring 10% as a hedge fund titan has taken a billion dollar stake >> and bitcoin has taken a sharp drop this the past hour or so. now over to tyler in los angeles. hi >> hi michelle, and welcome everybody. i'm live at the disrupter 50 road show here in los angeles. what is the disruptor 50 it is a very shektive process. 981 companies nominated this year autos every sector of the economy. we have pared that number down to 50, the most valuable ever, combined valuation of $308 billion. coming up, the ceo of thinks and
listener and they don't spell it like you think or listen. listen shaking up how we think about wi-fi and blue tooth more from the road show coming up. >> tyler looking forward to it. >> i am sarah eisen. here are headlines revlon naming its first ever female ceo debra perelman takes over from fabian garcia who stepped down in february. perelman is daughter of the founder and has spent more than 20 years at the kmets giant. comcast is preparing an all cash offer for 21 century fox. preparations are in advance stages and would be at premium to disney's offer. two consumered advocacy gros say consumers could be thinking into auto pilot makes the tesla avenue driving when actually it
is an enhanced cruise control application. general electric is the worst performer in the dow at this hour. leslie joins us. >> flannery was speaking at an industry conference where he affirmed ge's targets for profits and free cash flow and also saying he doesn't expect to see profit growth at ge's power business this year most of his comments were focused on that part of the business, which along with ge capital are seen as beleaguered units in the company flannery told the conference the management team is focused on what they can control, which included better operating he can accusing and getting margins higher flannery repeated the phrase "back to basics" several times adding he would be the first to say it's been a quote challenging first year since taking the helm.
>> challenging is putting it politely leslie picker. joining us, christopher glenn. thanks for phoning in. especially on a day when we have so much news on general electric you said the 2018 outlook included a second half uptick in power which seems to be the opposite of what we are getting from the ceo right now is this a dramatic change in tone >> no. the outlook had always been for flat profits for the year. they are starting a bit slower you know, they were down over 35% in profits for the first quarter. the fourth quarter last year was very, very, very weak. so that's much different comparison and they have got a little bit more cost out. it's more of a comparison and timing iryou and it's seasonally stronger in the second half, too there is not a whole lot of meat on that particular comment today. >> what is driving the stock
down 6.25% >> i think it has to do with the fact that shares had moved higher on a lack of incremental shoes to drop the last couple of months and also on some expectation that at epg there would have been a bigger disclosure of a portfolio move and that flies in the face of the ceo's disposition that he states and owns up to that, you know, while everything is on the table they are not going to rush into anything and do anything on a suboptimal or externally imposed time line. >> you have got an underperform on the stock there is reasonablebly a lot of beleaguered holders out there wondering how much lower can this thing go. what do you think? >> well, i think we are in a healthy environment for mul industrials and they are a more attractive higher visibility places to play right now as far as ge goes itself, i
think it is unlikely to materially test the lows that it has already established. it is a little bit above that right now, 10% or so and i think it will bounce around, it could catch a market tail win at times. maybe pull back a little bit of the. but the pieces for a sustained step function revaluation materially above 15, we just don't see the valuation case or the fundamental operating case for it in the short-term. >> chris, what about the ceo a lot of people who were looking for a bottom on this stock pointed to john flannery they see him as credible it's almost as if he lowered expectations overall how is he managing investors? >> i would say the portfolio shift you referred to was this announced merger of the transportation business which, you know, is about 5% of industrial profits so that's not a big piece.
i think people may have been looking for some news on maybe offloading the insurance piece where they have the large liability or perhaps committing to monetizing the stake in bhge, the oil and gas business, on a specific time line i think he's not responding to that you know, the timing of the transportation deal was very clearly stated that they could have sold itsix months ago and the valuations they were seeing at the time were comparable to that they ultimately realized. i like his style he inherited a mess. and he's going to pursue optimal resolutions, not ones that fall on a time line >> chris, thanks for phoning in. appreciate it. christopher glyn over at oppenheimer. lowe's home improvement chain soaring today.
now news that bill ackman has taken a big stake, leslie, another one in my world. >> and also news coming out of a conference ackman announcing his position in lowe's at a conference hosted by the law firm kirkland and ellis today. that's according to a source familiar with the matter in recent months he started putting the position on. it now amounts to about $1 billion. i'm told he is not currently seeking a board see. he thinks it is a great board with the right management in place. marvin ellison plans to join as ceo of low's in july de shaw settled with low's in january putting three new directors on the board previously ackman owned the stock in 2011. i'm told he locked in 30% gains in that position at that time as he monitored the company over the years he believes it can help jump start his portfolio, which is up a mere .1% year to date perhaps home improvement with his own portfolio and home
improvement as a sector. >> his recent performance, you might wonder if the market would give him credit. but when you see the performance today in lowe's there are still people who has credibility and believe in his -- >> it was up already >> intraday it had this spike on that news then it went back down to preackman news levels i don't think the markets are giving him any credit whatsoever. >> i think it's because when they actually read through the headlines and read through what he is looking to do this is not shake things up any more than they have already been shaken up this week. >> similar to what he did at nike, right. >> exactly i'm asking sources if this is a passive position like he had at nike no one said it is but he is not going to run a proxy contest any time soon. >> ellison backed the ceo of jcpenney his judgment might be worth
considering. >> leslie, thank you. we have a news alert now for you. let's get to julia boorstin with that. >> a federal judge saying that president trump cannot block twitter users from viewing his feeds, saying that president trump blocking users from viewing what he tweets on twitter is unconstitutional and would violate the first amendment. this comes after a federal judge encouraged a settlement suggesting that trump mute rather than block some of his followers on twitter in order to resolve the lawsuit. the ruling now is that blocking those followers is not aloud back over to you. >> super interesting thanks julia so the president cannot block someone else because it violates their first amendment rights. >> of free speech. >> feels almost the reverse to me two, you wonder, does this closer to twitter being labeled a media company? >> you completely. >> and therefore ends up being
regulated himself because of that. >> he did it himself presidential proclamations and statements come in the form of tweets and therefore should not be restricted i don't think to people. >> or is the comparable how users use twitter as reg fd. they are being allowed to release company news on twitter. that's violation of regulation fair disclose ooir is this the same level of disclosure >> think elon musk. >> does he block people? that's another question. he might, considering what people say to him sometimes. >> not as much as the president. >> probably to the but if you are chairing to it reg fd. >> companies cannot block anybody from their twitter feeds. >> whole new world for the judges >> super interesting. president trump speaking in just the hours -- actually speaking about the state of nafta negotiations here's what he said.
>> auto workers and your auto companies in this country are going to be very happy with what's going to happen you will be seeing very soon what i'm talkingabout. nafta is very difficult. mexico has been very difficult to deal with canada has been very difficult to deal with they have been taking advantage of the united states for a long time i am not happy with their requests, but i will tell you, in the end, we win we will win, and we will win big. we will get along with mexico. we will get along with canada. but i will tell you, they have been very difficult to deal with they are very spoiled. >> the president also comment being the north korean summit saying he will know more about the status next week and that the date originally set may change stocks are off session lows but still on pace for a second straight day of losses the nasdaq and s&p 500 are down four out of the last five sessions let's get to bob pisani on the
floor of the new york stock exchange with more on how the trading is going touchdown. >> latest batch of trade headlines not as fairible. and the global cyclical stocks, the industrials and the material names to the downside. look at the industrial names, floor, ingersoll-rand, norfolk groupon all down steel stocks were down big over in europe. cf industries, preport, mosaic all on the weak side we have ancillary issues going a sell on the news on the banking -- the regional bank stocks all run up on the hope of the dodd/frank reform. they essentially have gotten it. all of these stocks up 6, 7% in the last month off a bit today. and the yields stopped going up on top of that but the u.s. economy is doing a lot better than the european economy. we got numbers today from europe that were frankly not good
manufacturing, pmi numbers at 18 months lows, the earnings for the first quarter were terrible. they were up 3%. the u.s. earnings were up 26%. i have never seen that, eight times better earnings in the united states. obviously, half of that is the tax cut. but that's a big differential. the result is europe has dramatically underperformed. flat for a year. and europe up 14% on the s&p 500 in the last 12 months. tiffani's, same store sales up 7% theyreport, japan up 9%, america is up 9% europe, down 9 brz there in a microcosm tells you that europe is declining while the rest of the world is increasing in tiffany sales. news for tiffany, a billion dollar buyback and excellent guidance for the year. >> big move there. thank you, bob where do investors go from here. joining us now, matt roddy and ron wiener guys, good to have you here.
matt, let's start with strayed we heard the treasure talking about it there is a lot of consternation out there. is that what is driving the markets lower or are the concerns about trade overblown >> i think they are a little bit overblown. my mama said there would be days like these the trade and the tariffs are still compared to the stimulus from the tax cuts, the potential for repatriation as well as the spending on infrastructure which we think will come into play by the end of the year. >> what about you? why do you think the market is today? because of trade or just taking a break? >> i agree with matt trade is not that big of an issue, especially with us and china relatively speaking. the fact that the market is down today is not a concern let the jitters come out in certain sectors. you pick your thesis, go with it and we see the world as more than half full we see the pie expanding
globally, more people that are buying cars and toilet paper and i-phones so we are still bullish on the world and thus the u.s in fact, we are more bullish on the u.s. than foreign. >> the toilet paper indicator. >> i'm not sure those companies are doing so well. the people who make the toilet paper, that is ron, if you think that the trade wars are overblown do you step in is buy the stocks that have been whipsawed around by trade fears? >> boeing has been the poster child. you probably had an opportunity if you are a believer this the longer term story and think the trade war fears are in fact overblown? >> we are wealth managers where we manage for whole families so we build over time. boeing is a great story where there just isn't enough time for them to build enough planes. they have a backlog. the shortage of pilots the world is expanding we are going to be more like the jetsons than the flintstoned to sell boeing and get in at a
certain time we think that's fool's play. you pick your good companies, stick with them through the ups and downs. it creates capital gains on the long term nature building wealth is not about trading for us though we do move the portfolios about 20% a year. we are with boeing. >> i wanted to highlight something bob pisani brought up, weakness oversees, especially in europe in terms of the economic data can the u.s. market really rally with those sort of head winds? it creates a stronger dla which we know multinational earning don't like and this whole rally over the past years has been predicated to anacin crow niesed global conomy. doesn't that hurt u.s. stocks. >> the global story is more lumpy than it was in 2017. the euro rallied last again. a lot of currencies rallied against the that are
i think that impacted their currencies negatively justice like it hyped ours you will see benefits lobbied back over to them versus us. the trade war thing, it is out in the open, very loud and vocal but this has been going on for centuries. just a lot of times it's been done more quietly in the back room. >> certainly not quiet now, matt thanks ron, thanks matt. a news alert in the bond market five-year notes up for auction rick san they tracking the action what do you see for demand >> 36 billion five year notes. a c plus biggest size of course since july 2010 as we continue to feed the beast with regard to debt and deficits the yield, 2.864 darn close to exactly where the one issue market was training at trait up 2:00 eastern f. we look at the internationals, 2.52 bid to cover above the ten option average. as is directs at 10.9.
the lightweight was indirects at 56.2 lightest since july '16. below the auction average, which means they take shy of 33% not bad a.c plus tomorrow is seven year the real issue with those auctions is they are shorter term when we get to the longer data we see more interest a.c plus. tomorrow will be the last of $99 billion in supply. michelle, back to you. >> rick santelli speaking of bonds, italian bonds resumed their selloff today pushing italy's interest rates higher yet again ten year at its highist amid worries of a euro skeptic government and the stock market fell in italy as well. down 1.5%. the banks are getting hit hard
because the new potential government wants to make it easier for mortgage holders not to pay back their loans. turkey raised key interest waits by 300 basis points in an evident to stop the currency from plummeting. market participants think they should have gone 400 or 500 basis points it did turn the market around and likely squeezed some shorts. >> is the euro right now pricing in the potential spillover effect from italy? if it's not, we could see a higher dollar. >> it's not. it's back to november lows it's taken a little bit off but italy i think was always a bigger -- in many way as bigger existential threat than greece was. the problems aren't as big but the economy. >> much bigger country way bigger >> it's huge it shows the problem for having a euro for a weaker economy, a germany versus arch italy. >> yield are right around 2% during the crisis the ten year would get to 7%. that's when people would panic
we are long ways away. >> we are watching. some stocks sparkling, others missing the mark. we have all the numbers and how to play it. speaking of retail we will talk to the head of a company that's disrupting an area of retail that normally doesn't see a lot of innovation. it is an amazing company stick around for this up with. "power lunch" we'll be right back
welcome back to "power lunch. big day for retail earnings with some companies seeing double digit moves. tiffani seeing its best day since 20016789 up 20% after a blowout quarter with same store sales growing 7% raising guidance and announcing a $1 billion stock buy back. on the flip side target is lower on pace for its worst day since november after missing forecasts for profit of the it was margins that hit the stock revenue and same store sales coming in light. the retailer blaming bad weather for the sails miss on the bright side it is remodelling its stores and that seems to be paying off with traffic growth hitting its highest level in more than ten years. check out lowe's, another big winner today, up nearly 10%
despite missing its goals. blaming bad weather. the outgoing ceo said he was encouraged by strong sales in the month of may the company announced that jcpenney's ellison would be take over the company effective june 1. the stock is on pace for its best day since 2008. let's bring in oliver chen senior retail analyst at cowen take your pick i know you have been making moves on prices and stilts what's the best bet in retail right now? >> we are big fans what have tiffany and company is doing we like the luxury goods secretariesor. we like this theme of what is unamazonible tiffany, sothebys, lvmh. we also like deep value. koss coand tj roc jrkj ross
weather has negatively impacted apparel sensitive categories because it has been cooler than expected and we needed it to be hot. there is a lot of cross currents tiffany is inowe vagt product, marketing stores they are becoming more modern and customers are returning to tiffany on the heels of new collections, new product as well as new campaigns that are innovative, fun, disruptive as well as tying back to the history of the brand the blue box is iconic. >> oliver, to you chalk off the compressions in margins completely to the weather. all you call this price investment was there discounting involved here >> there is. there is a multiyear situation going on in retail with value and investing in price target really needs to address expect more and pay less pay less is a big factor in the equation what happened this quarter was
in line with management expectations for the most part except for the margin mix with respect to weather so that was a factor in terms of the margin other than that, the comps were very strong and traffic was very strong as well but it's something to watch as a theme in retail that all of our companies are having to discount and offer competitive values or value for price. >> what do you call it investing in price >> i think it is a fancy way of saying, you just need cheap stuff. and also you have to offer cheap stuff -- >> why say that? where did the nomenclature come from >> it sounds better, more professional. >> it's really just you are discounting, right, you are cutting the price in order to get traffic in, to get the sale. when you say price investment, you are like it's price investment it sound positive but it's really not what we have seen is price investment to the point where mother-in-laws are compressed and that's a negative for the investor. >> yeah. that's why you have to turn the brand, like tiffani where you
can really get margins and pricing leverage in categories such as jewelry. grocery, food, apparel, where there is less differentiation, that becomes a problem and people compete on price. what i would say about target they have done a good job with their own brand, project 62, opal house their own brand give them some leverage on price. that's big factor for retail over the long term, especially with amazon and others competing on the basis of price is very competitive. >> speaking of winners, ralph lauren we didn't each get to up 15% on pace for its best close since 2015 oliver chen, the man likes tiffanys he likes the tea collection. >> ann rand would be proud, right, investing in price. >> nfl out with new rules to try to put an end to its controversial national anthem policy is the policy going to make everyone happier?
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the nfl today announcing its policy on the national anthem. eric chemi joins us now. they want this to go away but it seems like they are rooig trying to split the baby. >> the rule will now be you have to stand if you are out on the field. but if you don't want to do that you can stay in the locker room.
basically what they are saying is we don't want the see anybody kneeling, sitting, doing anything that's disrespectful. either come out and be respectful or don't come out at all. that's going to be tricky for them to balance. roger goodell talked about this earlier today. here's what he had to say. >> we want people to be respectful at the national anthem we want people to stand, that's all personnel and make sure that they treatment this moment in a respectful fashion. >> the union has already come out to say they are going to see if they can challenge this poll see. they don't like it they think it contradicts what the owners have told them throughout this process. for now the commissioner can go ahead and do this. players and teams could get fined if they go out there without following the new rules. >> they don't want donald trump to see them kneeling on the field. >> they don't want the papa john's relationship. double digit ratings declines. they are trying to figure it out. >> how many players at one time
have taken a knee. >> remember at the beginning it was a larger number and by the end of the season -- >> if you have five or six players missing, name the number, and it's sort of a chriscal mass, you see that by your own eye that the whole team -- >> the if they line up if one team has 55 players lining up or the other has 45 players. >> now can someone hire collin kaeperni kaepernick. >> that lawsuit is going through. and his teammate is now suing the league as well. >> eric chemi on the nfl speaking of sports we predicted it on punch. the sports gambling ruling from the supreme court would lady to an wave of m&a today fan duel is being bought will another be next racts?
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from the ground up and having citi as an early investor worked as a signal to others to invest. with citi's help we built a wonderful maternity ward and we were able to purchase an mri machine. we've made it possible for the people who live here to lead healthier lives and that's invaluable. ♪ hello, everyone, i'm sue herera here's your cnbc news update for this hour. france's foreign minister says the u.s. decision to scrap the
iran nuclear deal and implement a strategy against iran where straighteningen tehran and endanger the area as a whole the french president macron welcoming facebook's founder mark zuckerberg and the ibm chief and microsoft's ceo to lunch to discuss business opportunities. former secretary of state john kerry was also in attendance. and police have taken a student into custody after threats prompted the closing of two southwestern illinois high schools. the mother of the unidentified student who was arrested says that he made suicidal comments to her before she discovered that her handgun was missing. and houston astros starting pitcher gerrit cole gave up a home run to san francisco's brandon crawford who also happens to be his brother-in-law the two didn't say anything on the field, but it will probably be discussed at future family gatherings like around a thanksgiving
dinner or the christmas dinner anyway back to you guys. >> couldn't that be a conflict of interest? maybe he shouldn't be allowed. maybe he went easy on his brother-in-law as a gift to his sister. >> or harder on the brother-in-law. >> i would go harder >> that's my suspicion. >> it reveals something about our personalities. >> maybe. >> i think so so, too. we are a tough group. >> thanks, sue. >> you got it. the supreme court's ruling on legalized gambling is already paying off for one company back maker patty power bed fare announcing it will buy fan duel. services like these are in a unique position since they already have a strong foot hold in the sports gambling market. could draftkings be bought next. let's bring in their ceo good to see you again. >> good to see you, thanks for having me. >> a lot has happened even in just the short amount of time since the supreme court had its ruling you look at this deal. do you think that you need scale
in this space in order to compete? that's what this deal seems to imply? >> i think this is a deal they felt made sense for them, and you know, we are very happy for them it's always good to see interest and activity in the industry you know, i think without knowing the individual circumstances of the company it's hard to say exactly what the thinking behind the deal was. but i think it clearly is something they felt made sense for them. >> a lot of your early investors -- i have spoken to rick heightsman on "fast money" recently they expect an irk po. does this move up the time line at all is it your preference to ipo or to sell the company? >> my preference has always been the ip, o but we are open to different outcomes i don't think it changes the time line at all i think the supreme court decision if anything is going to have a bigger effect on what we are thinking about in terms of timing you know, we like to really focus on our own path and what we can control obviously it's always good the
see what others are doing and keep an eye and be inrm fahd you know, i think it would be a mistake if we let it affect you are decision making around timing for an ipo or other strategic decision >> did patty power approach you or anybody else approach you in the wake of the decision by the supreme court. i should probably not get into that we generally have confidentiality with any discussions we have been having. there is a lot of activity going on right now you can imagine everybody is kind of talking to everybody at this point. >> in terms of your priorities, the supreme court ruling has probably given you a lot to work on in terms of rolling out sports betting across the country, especially in states that already have existing legislation. but one of the fastest growing areas in sports betting is in e sports we are going to have a segment on fortnite. i'm wondering if you are thinking we have got the get on this ban wagon, got to expand that platform?
>> we have fantasy e sports. it's been actually our fastest growing sport this the last year still small relative to the professional major sports leagues but very fast growing and obviously a huge area of interest for a number of different stakeholders fortnite we have not launched yet of the we had a discussion about that the other day and haven't made up our mind on what we are going the do there yet. i agree that sports betting is going to be an important part of the industry. >> how else are you positioning the company in the wake of the game changing supreme court decision >> you know, when the first announcement that the supreme court was taking this up happened in the summer of 2017, no punnin intended we made a big bet. we decided to shift a large chunk of our product and engineering resources to building a sports book product we have been workingan that almost a year at this point. obviously a lot of the things that that we had already built, the compliance systems, the payments and all of that was
applicable we didn't have to build everything from scratch. we have been working on the product almost a year and feel excited about the position we are in for us it's about finding the right partners to bring it to market people will help us on the licensing and distribution side. there has been thou shortage of interest there we are looking forward to how all of this unfold. >> jason robbist, thanks for your time. >> last year fan duel and draftkings planned to merge and they had to call it off because of anti-trust issues. meg trel has a market flash having to do with camping word. >> camping world and rv makers author industries and winnebago. all of those stocks down on a filing that came out from camping world where essentially they say they changed their auditors to deloitte & touche from ernst & young after they already disclosed there were accounting issues for the year that ended in december of 2017
at camping world so you are seeing all of those stocks down a little bit today camping word the most, more than 9% the ceo of camping world telling cnbc however this will be the most profitable year in the history of the company despite that, though, the stock is down more than 50% on the year we will keep an eye on the situation. >> coming up, back to tyler mathisen in los angeles at the cnbc disruptor 50 road show. >> we will have a guest who is helping to build a new company that solves an old problem for women. all that from the disruptor 50 road show when we return
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welcome back, everyone, to "power lunch." tyler mathisen here in los angeles at the cnbc disruptor 50 road show. look who is here it's great to have you here julia. it's great to be on your turf. >> welcome to los angeles. >> thank you this list of transformative and disruptive companies has more businesses with female ceos than ever before and more companies on the list are targeting female customers. we are joined by the ceo of thinx. if you are not -- welcome, maria, good to have you here if you are not familiar with thinx, and i was not, i'm a man. and you are going to explain to me what the product is, what it costs, and how you persuade women who spend what the product costs to solve a hygiene matter that they can solve for pennies a day. >> sure. so every pair of interwear has a four layer technology built it in it can be used as a replacement
to traditional period and bladder leak products. that's really what it does then in terms of the price point we are on average between 24 and $39. the average price point is about 34 in terms of why people choose thinx products is because of two reasons. the first is because there is an increasing need and interest in supporting the environment and every one of our products is washable and reusable. it's good for the planet and it's also a real focus on health and wellness. people are increasingly concerned about what they put in their body there is all this talk of toxic shock syndrome and every product that we have is obviously good for somebody's body. >> he so you are trying to change an entire way that women shop instead of going to the drugstore once a month you are expecting them to spend more and make a bigger investment in a pair of underwear they are going to use for a lot longer. >> uh-huh. >> how are you trying to change the entire behave of the way people approach this
>> the products themselves if you touch and feel them, which is a big goal for us is to try to -- we are 100% on line in terms of how we sell the product today. we are also looking to go offline so people can touch and feel the product of it's quite beautiful and feels really good. secondly, the focus on the fact that it's really healthy it's really focused on the environment. and that helps a lot in terms of -- >> two questions come to mind. first one is how many repeat customers do you have. in other words when a woman buys a pair of these ungarments to they come back and buy more? >> yes 30% of our revenue is repeat so we have a good business there. >> question number two is, disruptors, almost by definition take on big giants, behemoths, there is proctor and gamble, union lever, all of these consumer products companies that could really do what you are doing. >> right. >> how do you defend >> what is crazy is young people
have been putting really old things in their body now for more than 80 years i know it's hard to believe but the incumbents haven't innovated since the menstrual cup in 1987. a long time. we put a man on the moon, invented the iphone. but 50% of the population uses these products on a regular basis and there has been no innovation. >> how are youess growing the users base how many have you sold so for. >> we have 500,000 people on our customers list the market is huge it is a $34 billion market globally our segment is the fastest growing segment. it's growing at 30%. >> two more issues michelle wants to know, from the desk, does this product replace the need for conventional feminine hygiene products, tampons and pads and so forth. >> it does. >> it does. >> yes. >> you don't need to do that number two, when you came aboard
last summer you came aboard with a problem to solve the founder of the company had left the company as a result of sexual harassment allegations having to do workplace culture >> before i joined, i discerned two things the former ceo is no longer with the company. the business had a really strong foundation since i've been there, i've focused on taking a deep look at the systems, the processes, the team the organizational design and that is unusual for a company of our stage and size. i think that's set us up for success, now we can scale faster and more efficiently >> you've had to put in a real big league human resources function into a start july cup tour >> i did, yes.
>> we have to go, but we'll talk to you in about an hour on stage. we'll have the ceo of lisnr, taking on the way we deal with wifi, broadband and get into events via ticketing and so forth. that coming up in an hour. >> we had so many questions, we think it would have made the male audience uncomfortable. coming up, redfin. are rising mortgage teras pricing people out of the housing market
what's a good wifi password, mom? you still have to visit us. i will. no. make that the password: "you_stillóhave_toóvisit_us." that's a good one. [ chuckles ] download the xfinity my account app and set a password you can easily remember. one more way comcast is working to fit into your life, not the other way around. mortgage rates keep rise in. ceo of redfin opinion good to have you here, before we talk about what's happening with home sales, your most recent earnings call with analysts, you were pretty angry, the american dream of homeownership is lost in a landlord nation. >> i was concerned i think as home prices have
risen the government hasn't made credit easier to access, lots of people who are moving up decide to hold on to their old place and rent it out to somebody else air bnb has made that easy, credit has made that a tight squeeze. i think you're going to see more people renting homes from a landlord nace. >> people don't want to build starter homes. there's not enough supply coming online >> the real issue is zoning, there isn't land to build these places when you only have a few plots, you build mansions, and you try to take profits instead of going for sales volume we've had 36 straight months of declining inventory. >> you're in seattle right now, there's a lot of criticism what the city government does,
they're not allowing enough high density zoning, do you buy that? >> the city is trying, i think it's the citizens. >> even though this is something who supports integrated communities and diversity and everything else we're all worried about having our home put in the shade by some apartment building or condo building that's just the cost of living in the big city. sooner or later we have to welcome more people into this place otherwise it comes a no fly zone for the middle class. >> we know in new york city those big buildings going up we have to go, we have to hit some news from the federal reserve. >> breaking news on the fed. minutes from the last side of the break market movers, 1:05. don't go anywhere. with fidelity's real-time analytics, you'll get clear, actionable alerts about potential investment opportunities in real time.
still, to see if the fed has any clues in terms of the minutes on whether or not it's three or four hikes this year we have the 10-year treasury yield at 3.025%. we'll be watching those and how they move. the fed minute the are now out >> federal reserve officials hit hire may meeting another rate hike is ahead they do expect to stick to a gradual rate path or rate hike path ahead a few did say it could be -- the fed may be near the longer run rate of normal and they hit it before too long. we've had the fed president suggest that to us in interviews did could be time to remove the larng, according to their calculations, it may not be any longer the committee debated how much more policy firming the fed needs to do. on the critical issue of
inflation, the fed set a temporary period above 2% is consistent with its symmetric inflation objective. get used to that word, it appears nine times outside of the statement from the may meeting. many emphasize that the fed's target is symmetric. inflation is seen remaining near there because of a tight labor market they worry about the inflationary effects of the oil. it may no longer be giving us the signal it once did, because of hiking the funds rate on the important issue of wages, many on the fed are saying, overall wage pressure remains moderate they see little evidence of general overheating in the labor market and they still see some scope for the labor market to improve. a couple quick words on what the
fed sees as the risks and uncertainties. supply constraints could affect the balance. the issue you guys were talking about when it comes do trade a lot of warnings in there about trade. there's a wide range of possible outcomes from some of the trade discussions going on some are worried that trade uncertainty could dampen business sentiment and even dampen business spending melissa? >> steve, thanks so much stick around, steve. >> we're going to do market reaction now >> jordan posner joins us. brent schudy also with us. i'm looking at some of the moves here, it looks like the nasdaq went positive, the dow was down 100 points we got a little bit of a rally off of this. i'm not sure it changes the trajectory of interest rates >> it seems like the fed is
backing away from the assumed normal level, somewhere in the high 2s, maybe low 3s for the federal funds rate the fed seems to indicate we might be i think it would be a positive surprise to the market really kind of dancing around minus 100. it seems a little less bearish for stocks than we've seen in the past >> i want to go back to a comment you had, get some clarity and insight from you in terms of the yield curve they're not worried about what the yield curve might be telling us, does it sound to you they don't care if the yield curve goes flat? >> it sounds to me they're willing to give it a little more rope than they would, because of a variety of factors out there, i'm getting my notes together here they think raising the funds rate could be affecting the yield curve. the way the treasury has been financing the deficit of late. we have to watch this there is a sentence that's important to
monitor the yield, because of this, all these factors i just listed, the yield curve might be a less reliable indicator. i want to point out, i think ron is right there is a dovish tilt do this situation here how much further does the fed have to go it's been hanging out there, and is it a 3% normal or somewhere closer to 2, 2 1/2 percent normal i think that has enormous implications for the stock market it's a question of how far powell is willing to experiment with this economy the way it is today, what constitutes a normal fed funds rate >> right now, the big headline, fed is going to let inflation run above 2% for a temporary period ed this sounds like a dovish statement. >> i think the fed, j. powell
has to talk to the markets about what it means by temporarily over 2%, how high and for how long i'm going to be talking to a bunch of fed folks tomorrow in dallas it's something the market has to figure out, ultimately you're correct. it is a dovish signal there. >> what are the market implications for you does this change anything? >> it doesn't change much. the fed was going do let the economy run hot, and let inflation run hotter than it has in the past, it's been so low. we did have three fed presidents last week who came out with varying comments on the yield curve. bostic said his job was to make sure the yield curve didn't invert caplin said he didn't want to knowingly invert the yield curve, and buller is saying they should stop tightening, because the yield curve is flattening. i think the fed is going to stay dovish, and they want to let the economy go and do no harm right now.
>> 12i7bs these minutes were taken in italy, argentina and turkey >> there might be a reason for the fed to lay off, and it could be totally external and not internal, which is that you have a contagion risk that's developing in markets like italy. >> do you have a contagion risk? >> i think there is. >> i don't see it. >> it just started the italians are talking about a second currency, not paying back the -- >> italy, maybe. not as much turkey and argentina. no, but emerging markets are supposed to outperform >> i think what we're talking about is not a near term question i want to -- >> i think what ron is talking about is later december. 2019 are the implications we're
seeing here. >> what have you heard >> are the fed discussion is usual when i about what's not happening immediately. but what the trajectory might be going-forward. a couple things that give me some thought willings, inflation running a little over 2% is 2 pngt 1% or 2.2% that much different than 1.8 or 1.9% no, as long as check takings are made tethered. the one thing that came out to me that's more explicit than i think the market needs to come back to, is the risk to economic growth from trade difficulties that's something we've been flagging for a while we think some of the rhetoric coming out of the administration is probably an ugly public negotiation, there is the risk that trade difficulties inning crease and that would certainly
help putsomething of a lid on global trade, global economy, and the u.s. economy >> we've seen the nasdaq go positive, it looks like the stock averages are trying to make a run talk to us about the international picture we just highlighted. when you see yields in europe for the most part excluding italy. falling because their pmi's come in so poor i mean, how strong does the fed want to let the dollar get, when you see that international picture? >> the fed can't directly affect what's going on in the international markets. they can react to it but they're much more concerned with what's going on in the domestic economy, domestic rates, inflation, et cetera. i think the fed is cognizant of that we've seen the low rates in europe have been a lid on how
yield rates can adjust we think that some of the weakness you're seeing in economic data in the u.s., somewhat slower than it's been in europe is probably temporary, and we would expect that to improve as the year progresses >> stocks off of session lows, 10-year yield little change. it was already half a percent weaker today thank you for breaking those minutes with us. steve liesman in d.c. and ron here. >> the floor of the new york stock exchange little market reaction, little reaction in the yields, guys, we are seeing stocks make a run here toward the upside? >> yeah, i think it's encouraging here, is this word is amusing it was mentioned nine times, to me, symmetric means
we're not going to freak unite if it's a little below 2%, or a little above 2%. i think the pc is a little above 9% when will they get really concerned if it's 2 1/2, 2.6 clearly this symmetric idea seems to be implying they will be a little more intolerant of higher inflation i think he's right >> the fed seems to not to want to have this 2% target sitting out there as a trip wire once we get there it's time to move faster in terms of raising rates, the entire market has been a push pull between strong corporate earners, a consumer that's in good shape and has some momentum. and financial conditions tightening at the margins. maybe credit spreads as long as the latter, you don't get as much tightening as fast as we feared the market can take some comfort in that, not terribly
dramatically >> here's what i think the minutes told us. the fed is just like us, just like investors watching, they're watching the yield curve, which it does -- if it does invert that signals a recession, they want to pay attention to it. if it overheats, maybe we'll tolerate it, we don't know yet if it's a huge problem it's a wait and see. june is baked in as a rate hike, is that what you're getting? >> without a doubt they're on some level on wait and see mode we don't know how much the fiscal stimulus is feeding into something sustaining, or it's going to be a 2018 burst all these things are open questions. i think they feel as if, as we've been saying, if june is already baked, in the stakes are not that high in terms of attacking one way or another with this statement. when we're talking about three or five months down the road >> i agree with that
the fed is a little less concerned about the yield curve as an indicator of the flat or inverted yield curve we've been seeing for years, foreigners coming in, buying our long dated treasuries because of the higher year yields, because the actions of their own central banks have been keeping yields artificially low, that's created an artificial situation. and i'm not so sure that a yield curve has the same signals as it has in the past. what steve is implying is right. >> that sounds like greenspan's conundrum in the mid-2000s when we were trying to explain away why they wouldn't go up >> if it inverts that's a huge deal people will be talking about recession either way general electric having its worst day since november they cannot guarantee its 2019
dividend john flannery adding, they see no profit growth at ge power through 2020 we're also watching bit coin which hit the lowest level since mid april. speaking of bit coin tonight we'll be speaking with the president of coin base coin base number 10 on the cnbc disrupter list you'll want to tune in we want to make a note of netflix watching the market reaction, hitting an all time high in the last few minutes. >> we think that could be because of a. >> very influenced with the interest rates with a huge multiple it could be. if you want to understand the impact of fort night you have to ask one of the analysts on the call
he joins us with what he learned. >> could alexa soon be the queen of your castle what amazon is doing to make that a reality it's a hall of fame bust that was a big bust now there's an update. you want to stick around for that just another day on the farm. or is it? this farmer's morning starts in outer space. where satellites feed infrared images of his land into a system built with ai. he uses watson to analyze his data with millions of weather forecasts from the cloud, and iot sensors down here, for precise monitoring of irrigation. it's a smart way to help increase yields, all before the rest of us get out of bed. anyone can get you ready, holiday inn express gets you the readiest. because ready gives a pep talk. showtime! but the readiest gives a pep rally. i cleared my inbox! holiday inn express, be the readiest.
moving its headquarters, currently in denver to newport beach, california. functions will either be consolidated into chipotle's existing office brian nichols says we'll always be proud of our denver roots the consolidation of offices and the move to california will help us drive sustainable growth while continuing to position us with the in the competition for top talent chipotle is going to transition denver and new york offices to newport beach. >> this is going to impact 400 of chipotle's employees. for the year, guys, it's up about 50%. back over to you >> thank you >> in case you haven't heard about it, it's called fort night. the single hottest video game on the planet right now 40 million players in the u.s. the obsession shows no signs of
slowing down one firm decided they needed to better understand it to make investment recommendations what did they do they went to the source, 12-year-olds >> that conference call sounds like a genius idea if i may say so there are a lot of people that don't seem to get it what you gleamed, 98% of the 12-year-olds play it. they spend all of their money on goods in this game, that's the business model you spend money and buy virtual goods. what is this displacing and who is this hurting in the end >> first thank you for having me we decided to go straight to the source we held air conference call with a group of 12-year-olds, to understand how they were playing fort night there were two things that stuck out for me the first was that we heard from a lot of parents that are concerned about their children
playing fort night, it's a social experience at heart these kids are coming home after school, they're powering up their xbox, putting on their turtle beach headsets and playing this game with their real life friends. it's a social xperience. they're using team work to win the game and strategy, i think it seems like a positive the second thing that we learned is that these kids, and parents may not want to hear this, they're playing this game at school they're playing on their iphones, and it underscores the importance of what we call cross platform play. fort night is available on pc. it's available on xbox and play station. >> what is this crowding out for investors, you can't invest in epic, i assume >> i thought you were going do say homework >>. >> in terms of the time spent on this game. it must be crowding out time spent on other games in terms of dollars spent in
this game. it must be crowding out dollars spent on other things. >> it's a concern. when we talk to the kids, the brands that they loved it's ft. night, instagram, snap chat, xbox these kids love the golden state warriors, they're doing it dink, not spending time on tv. there's been a debate. is ft. night cannibalizing the existing market or expanding it. you look at stocks like activision, ea they were down 17, 19% in march, on fears that ft. night would cannibalize their businesses our call back in march was, you should buy the group, the stocks came through, the earnings, the stocks have rebounded strongly through earnings earnings did look solid, ft. night remains the focus now. we're still watching it headed into the back half of the year
>> i know you're a gaming analyst. there's potential here beyond gaming always merch when you have these successful franchises. who else is capitalizing >> i think in a the winners coming out of fft. night, it's amazon they acquired twitch back in 2014 for $12 billion they're generating audiences that exceed cable networks back in 2013 $330 million investment if you assume the data i've seen that suggests that ft. night is monetizing a $2 billion revenue companies like ea and activision trade at 11 times current year revenues i think we call that investment a home run ithink turtle beach has been a real winner
you're right, people are buying merchandise, the t-shirts, collectibles at game stop. so we see a generation of people that really want to engage with these video game brand as cross not just playing the game, watching the game, purchasing commercial items based on ip around the game. >> tim, thank you. >> tim o'shea with jeffries. >> amazon's alexa, could be controlling everything in your home, diana olick is live in north virginia with more >> hi, and including this tease. alexa, what's coming up on powers lunch >> diana, power lunch is coming up next with a great story about how amazon is working with lennar on smart home services like me. >> stay tuned. highest in investor satisfaction with full service brokerage firms...again. and online equity trades are only $4.95...
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all. is this a lennar smart home product or an amazon showroom? >> will it rain today? >> no rain is expected today >> clearly for amazon and lennar is both. using each other in a show and sell strategy for products and services >> it's not just gadgets >> it's not just gadgets >> the smart home of today is really the way people expect to live >> that's ordering food as easily as it is opening doors, turning on lights and turning on movies >> alexa, movie time >> okay. >> and what you'll notice is, lights will go down, shades will come down, lighting will go behind the tv. this is an amazon -- >> these things in here. you have boundy. >> that will arrive in your normal amazon delivery >> this is the company of working with amazon. >> i never need to go to a supermarket again? >> the pantry is my favorite part of this whole thing hands
down lennar is focused on connectivity on the wifi certified house. that is no dead spots. amazon sf focused on the services the service industry that business is getting increasing ly competitive facebook just announced you can shop for home services through its marketplace. >> this isn't a house you buy. >> i have do say alexa, good night. >> good night diana. >> i had toe do that >> yes, so ow alexas all over
the place. you get the service. >> i thought it was going to be an intercom service. >> they're visible let's get the lights back on i have to say alexa reset. >> they are visible throughout the house, in the future, coming soon, you will see the alexas in places in the home that you don't see. i won't say where, i'm not sure if that's proprietary. you. >> will see them built into the homes. >> i have two words, privacy concerns, there are no laws -- >> i have one word, pantry pantry that gets filled. >> those dash buttons, they're everywhere amazon is everywhere >> diana olick we first showed it to you here remember this, brandy chastain's hall of fame plaque. that looks nothing like her. >> we have an update to this story which we'll bring you next
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cnbc news update at this hour. president trump answering reporter's questions upon his departure from the white house he commented on the north korean summit >> on singapore, we're going to see. it could happen, it could very well happen. but whatever it is, we will know next wyche about singapore and if we go, i think it will be a great thing for north korea. >> the fda is urging parents to avoid using numbing medicines for teething babies. some of those medicines contain benzocane which could be dangerous for children cold teething rings can help soothe the pain. nfl owners have approved a new policy for national anthem protests, permitting players to stay in the locker room during the anthem's playing, but requiring them to stand if they come out on the field. the players union, which was not
consulted on the policy says it will challenge any part of that policy, that violates the collective bargaining agreement. >> you are up to date. melissa, back to you the oil market is closing for the day, let's get to jackie deangelis at the cnbc commodities desk >> prices lower today. clearly, there is still some support in this trade. now, chatter in the marketplace at this point that opec may consider boosting production at the june meeting, to make up for anticipated shortfalls coming out of venezuela if they lose more barrels, it would be bullish for prices. an opec adjustment would keep prices level or take them lower from here. the dollar index continues to rise the dollar up 3 1/2% in the last month, guys? >> we've been watching that. >> jackie, thank you >> speaking of oil, production in north dakota is back near
peak levels as crude oil prices continue to rise is a second bakken boom on the market >> take it away, brian. >> sayre remark thank you very much we try to get the song midnight at the oasis leading into this, we couldn't roll it up >> i want to talk about what jackie was talking about, venezuela, the slow rolling humanitarian production how much has their loss of barrels helped prices here or put a floor under prices >> it's always hard to say exactly what's driving price at any point in time. of course, as you alluded to, that's been a slow roll down hill for some time i think everybody for the most part had anticipated that it was going to continue to decline >> do you think that it is putting a floor under prices,
the iranian tension or is this just -- >> i don't know that it is >> supply demand driven. >> i think it's supply demand driven, which is typically always is. you go through time periods where there isn't a lot of geo political risk priced in i think now we're coming out the backside of one of those, where every once in a while people get reminded that that is a factor that influences oil price from time to time it always comes back to supply and demand >> as you know, i joke around with people, they say, i've aged 10 years in four because of the volatility, you guys have been you said your shareholders and investors, you're going to be a net seller of some acreage around the bakken. noncore. as prices go up, do you want to rethink that strategy? >> it does -- on the edges it presents some change in perspective.
when we announced that we were going do do some divisive materials, we told everybody we were going to put more in the bucket than our target of 500 million, and see how things played out this is a dynamic business sometimes more dynamic than we want it to be. but we'll play that as we see, if -- it's also just a function of value, and then how people that are looking at those assets might price in or are they coming in with what you think is a value that's based on lower oil price. >> i assume you're very free cashflow positive right now, correct? it's 71, 72? >> yes, is the short answer. i think the other thing that's very important while it has been painful over the last three years, in the significant downturn, we were actually cashflow positive through the downturn as well.
and i'm really proud of the way the team prepared for that we never know when they're coming but we do a lot of things to be prepared for that. and the team did a great job of keeping us cashflow monthstive and with that, we spent 500 million on infrastructure to make sure we could move our products >> if you change your mind on the asset sales, just between you and i and cnbc we appreciate it >> thank you, we appreciate it >> michelle, i know you've covered extensively, you know as much about it as anybody we're in the middle offed ed n dakota and pretty much any conversation we have comes back to venezuela >> we see those barrels coming off every single day as they implode down there >> still ahead, no wifi, no problem? tyler's live in los angeles with more details >> thanks, michelle.
>> we're at the disrupter road show our next guest is doing just that to data transfer, he will explain when he joins us live next ...think again... ...and...again. the 2018 cla and gla, both starting at under $34,000. lease the cla250 for $319 a month at your local mercedes-benz dealer. mercedes-benz. the best or nothing.
welcome back to power lunch, in los angeles julia borstyn is here. wifi and bluetooth are found in every mobil device available right now. our next guest is looking to disrupt the business of data transfers using audio technology rodney, ceo of lisnr joins me now. >> i got to tell you, i don't understand your product. how does it work. >> think of us as a wireless transmission method. similar to ways you trarnz milt data we focus on short range wireless communication. and we're software versus hardware, and we leverage audio that you can hear.
so it's near ultrasonic aud yoi. >> give us some of the best use cases for this ticketmaster is using this tell us how we would interact with it as consumers >> we sell products and services the core use cases the short range authenticator. >> how short is short. >> me to you >> a few centimeters or tens of feet that's your ticket, that's how you pay. >> if i was to use some type of mobil pay scenario, i only have a qr code or nfc as an alternative. i want to mobil pay everywhere, every parking meter, every taxicab, everywhere i have an option the only option today is a piece of hardware. >> which are the companies or technologies or industries you're most trying to disrupt with this whole concept of audio transmission >> well, i think ticketmaster, you can say we're disrupting that industry.
they have chosen to go to a mobil ticket they have chosen qr code but it's a fraudulent vehicle. i can screen shot it, share it it's one of the reasons you still have to use your i.d >> we are matching the security element of an nfc type of transaction. >> you're not the only one doing data transmission over sound google is also trying to do something similar. what's to prevent a giant from google from just copying or crushing a smaller businesslike your own >> what we love to say, we created this, right? >> in 2011 we decided to create the next generation platform using sound. we're 12 times faster than google we also have a purpose to work everywhere that's not google's purpose. goog google's purpose is to enable android. ours is to enable lenox, windows. that's the difference between
creating a communication platform versus a product. >> one of the things that occurred to me as i was reading up on your company were questions of security and privacy. if you're using ultrasonic undetectable to the human ear, audio signals. what's to prevent some miss chef maker from hacking his or her way into my account, my ticket, my whatever. or to know where i am at any given moment, am i at the bar, restroom, seat >> there's always bad actors a bad actor still has to intrude your device. the intrusion isn't the ultrasonic audio the intrusion is the malwear that's a distinct distinction. they could use bluetooth, wifi
or any other way to cause mischief on your device. it's a standard that could apply significant security to the entire world of ultrasonic use just apply significantly more security in that aspect. in terms of causing mischief to a listener we apply industry standard security standards >> you're as good or safe as anyone else and maybe safer. >> when we hear so much about the boom, how amazon and google with all these home devices, seems like the new way people are going to be communicating is through voice and audio. all the different ways it can be manipulated. how are you going to make sure your services really distinct and is not disrupted by all the other players? >> you just made a significant point. today i can go to your alexa device and talk to it, tell it
to do something today you can mimic sound to trick alexa voice enabled devices should detect i you using something else that's us. >> a lot of companies are using us for straight presence detection. it's not just about voice, it's not just about sound is there a key that acknowledges you are where you are supposed to be? >> we have to leave it there >> congratulations on making the disrupter 50 list. sarah, you will be pleased to know that rodney is at least in part a cincinnati guy. >> i saw that. >> at 5:25 we'll -- >> right a cincinnati dude >> we'll have more from the disrupter 50. >> the great tech hub of cincinnati >> thanks. >> stay tuned, you saw that graphic promotion for fast money tonight. we'll be talking to the coinbase
president. they are number 10 on the disrupter list that's coming up tonight at 5:00, e scooters taking over city streets not everyone wants to go along for the ride. shares of best buy hitting an all time high today is the retailer poised for a big comeback and a big lineup on cnbc tomorrow from dallas 3
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welcome back to "power lunch. electric scooter companies taking over cities like san francisco, los angeles, and washington, but not without backlash aditi roy is live in san francisco with the story hi, aditi. >> hi, melissa that's right electric scooters are all the rage in cities like here in san francisco, l.a., d.c they could be coming to a city near you part of the appeal is they're so ease to use. you use your phone app and unlock the device using your phone here it's easy to pick up and drop
off wherefore you go but with the convenience also comes some headaches for city officials. electric scooters might be convenient for some, but check out these social media pictures. scooters vandalized, tossed in the trash, even up in a tree in san francisco, city officials will soon require companies to apply for permits as early as this week. despite those road blocks, money is pouring in. investors include andreessen horowitz uber and lyft are considering entering the market. there are three companies behind the idea bird spin's cofounder also worked at lyft and lime the competition is fierce so they're making a land grap fb f market share and who's making the money off of it? for one, the chinese company that manufacture most of these
e-scooters back to you guys >> they look really fun. >> they do they look dangerous to me. >> i tell you -- >> that's why they're fun. >> i tried with oy eied one. they look fun but i kept fearing i would fall off but they're not as fun to ride for me at least as they look >> i prefer a segway >> thank you, aditi. let's take a look at best buy for today's trading nation the big box retailer reporting tomorrow before the bell the stock has been out-performing the broader retail space this year s is best buy still a smart bet? michael bapis is with the -- you've got to give credit. over the last five years, a lot of people were counting out the fight with amazon. it's up 200% in that time. the s&p is up 65% s is it still worth buying
>> absolutely. i think they've done a great job of the bricks and clicks model the dividend is good and the stock is trading very strongly to earnings i think at this point a lot of the good stuff is discounted so i like it long-term, but i'd like to buy it on a pullback i think at this point, i don't want to chase the stock. one possible negative thing is they've quietly closed down their gamers club situation. possibly because it is too expensive. that could turn off of a big part of their customer basis i'll be watching it closely to see what they say about that >> michael, are you willing to buy here at a record high? or you also want to buy on the dips >> we're taking a wait and see approach it's run up so much. earnings are getting a little bit ahead of themselves and there's such expectation for them to deliver positive earnings that any little blip on the radar will cause the stock to go down we don't think the risk of owning it today ahead of tomorrow's earnings will outweigh the reward of the future that being said, if it dips at
all, 7%, 10% we would own it long-term. and this space is -- we're in a technological boom that's going to keep happening for the next 20 to 40 years >> all right, gentlemen. >> the one thing about it, they figure out how to do the high-tech model. >> we'll leave it there. thank you very much. for more market insights, head to tradingnation.cnbc.com. check please is next and now the latest from tradin tradingnation cnbc.com >> determine the amount you're willing to risk on any given trade. some traders use the 2% rule where they try and limit their loss on any given position to no more than 2% of their total trading capital.
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welcome back we want to show you shares of general electric the stock is down more than 7% and on pace for its worst day since 2009 the ceo speaking earlier today saying the company cannot guarantee its dividend and saying it expects the power market to remain weak through 2020 on the flipside, netflix is hitting an all-time high the stock is up 78% this year alone. up 116% over the past year >> you almost want general electric to cut the dividend significantly to get the worst
case scenario off the table for shareholders >> we asked at the time is this enough a lot of people said no they should do more to preserve the cash >> they still think the dividend is in jeopardy >> just as, though, people were saying the stock had bottomed and it was up 10%. giving most of that back today all right. it is time for check please. and for this we wanted to give you a little update on a story we brought you yesterday after giving a collective red card from the internet, the bay area hall of fame will get a second chance at getting brandy chastain's commemorative plaque. this was the zass aert the first attempt. nothing like her drew ton of criticisms from everyone >> to you guys yesterday on the show yesterday i heard you. >> bay area hall of fame telling the mercury news, we're going to redo it. it was not a great job well, chastain herself has been a good sport about it.
she joins the ranks of other sports and entertainment legends like christiano rinaldo. and lucille ball whose statue in her hometown had to be replaced because it scared children >> wow that's terrible. >> but the smart folks at the marketing team or social media team at arby's weighed in. they didn't waste a moment here. saying they made a sauce portrait of her, the soccer star see if there are any other hall of fame misses out there we're all over this story. tweet us or get in touch on facebook >> i feel like sauce might be an easier medium to work with than bronze >> at least they made her look female >> i never tried it myself >> yeah. she did look like a girl in the arby's version >> apparently it's hard to get
those busts and plaques done >> checking deutsche bank. tomorrow they're having an annual shareholder meeting we could get more clarity on what has been called by steve eisman the problem child of the global banking world so watch that one. and thanks for watching "power lunch. >> "closing bell" starts right now. i'm wilfred frost at the new york stock exchange. negative economic data out of europe ongoing trade concerns making them concerned what will drive the u.s. economy going forward i'm phil lebeau. the summer travel season is about to start and airlines are expecting packed planes. for the travels, a hassle. for the airlines, higher fuel prices and the potential to cut into the bottom line the company that specializes in women's clothes had had only one female on the board. today the women took control big news out of the nfl.