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tv   Closing Bell  CNBC  February 8, 2019 3:00pm-5:00pm EST

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here amazon a nonunion shop of course, new york largely a union city. >> obviously the stock is moving on this news and the question for shareholders, is amazon better off with jeff bezos at the top with these disclosures i bet the answer is next. >> "closing bell" starts right now. ♪ ♪ everybody's working for the weekend ♪ good afternoon happy friday very warm welcome to the "closing bell. i'll wilfred frost. >> i'm sara eisen. coming up in the final hour of trade, a bombshell blog post as jeff bezos accuses "the national enquirer" of blackmail and extortion. plus, the ceo of cleveland cliffs who in october called an analyst a disaster, embarrassment to his parents, even urged him to commit suicide, he'll join us live on set as his company soars in the right direction on earnings
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today. >> i think they made up. he and the analyst. >> they have since made up buried the hatchet and the stock's up today. >> up a lot over the last year. here's the picture of the market right now another down day for stocks. the dow jones industrial average down 163 it was worse this morning. off the lows but still lower s&p down about a quarter of a percent. nasdaq climbing back toward the flat line and the russell 2000 continues the outperformance. >> energies and financials suffering in today's trade utilities top of the pile. new report of a possible setback in the china trade talks. kayla has the latest. >> wilf, the white house is close to finishing an executive order that would widen a ban on telecom equipment. this is expected to come out in the next couple of weeks according to sources spoken with
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me and eamon javers. it would essentially come out before mobile world congress where big corporations are deciding what their purchasing will be for a few years and essentially try to steer those buyers away from chinese telecom equipment and potentially toward big u.s. carriers which would be very interesting dynamic at that point. while the u.s. has said that the huawei/zte track is totally separate of trade talks it symbolizes the long-scaterm negotiations i spoke with eric, a former nsc and u.s. official and says that there's still a lot of reason to be uncertain about the trade talks that are going on between the u.s. and china he said the cost of failure for president trump gives you reason to be optimistic for an interim deal or for an extension of that
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march 1st deadline but if you focus on the very difficult issues and the gap that still remains it is very hard to be optimistic now, that being said, guys, we know the president and the administration watched the stock market closely many observers say that the president probably saw the market drop over the last couple of days on the pessimism of a potential deal and that could be reason enough to push him toward a deal even as advisers remain somewhat fuzzy on exactly whether they can get china to make the concessions that the u.s. wants. >> how do we think, kayla, how should investors think about reports like this, that they're considering an executive order around telecom how does that fit into the overall trade negotiations is that part of the discussions next week in beijing or sort of a separate track on national security >> it depends on who you ask, sara the u.s. would say huawei and zte, national security issues dealt with by the department of
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defense and the justice department who leveled those criminal charges just a couple of weeks ago against huawei but asking the chinese they say they're intertwined an the fact of the u.s. bringing those criminal charges or potentially unveiling an executive order like this at a time when the sensitive trade talks are going on that that potentially is a stick not a carrot in these trade talks and perhaps that's the dynamic at this time that essentially the u.s. is willing to continue to level penalties against china for these issues that are not new issues even as they try to extract concessions from china. >> kayla, thank you very much for that let's see what this means for the market joining us you are exchange, sam stoefl, jack b
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have we seen in the last couple of days that we're turning south regardless >> very important. if we look at the ism decline in december, in the commentary that came out from companies, it was clearly saying that a main worry was everything that do with the trade war. tariffs, supply chain, china this is a very, very critical issue for the outlook. >> are you surprised it hasn't impacted the u.s. economy as much as other economies abroad >> it is true that abroad we are seeing some slowing and slowing harder than in the u.s. but remember that companies who listen to some of these uncertainties and adding to that the shutdown, dead ceiling, the fading positive affects of the corporate tax cut you have a fairly solid cocktail of things that are hanging over the market of uncertainties that need to go away and in that sense not surprising that this is the plan out in the future paying attention to this. >> for the negative macro news out of the rest of the world in the last week or so, i guess
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it's little bit of a surprise of no individual dais of big dollar gains but when you put it altogether in a sort of stealthy type way that the dollar has gained a lot for the week as a whole. >> well, wilf, listening to the comments put out by deutsche banc summed it up. it's trade tensions, global slowdown and brexit. trade tensions can be relieved overnight. let's keep that in mind. everybody's talking about trade tensions but listen. if protectionism is going to be embedded in foreign policy then, yes, we get out of equities and forget about it a little bit this is a negotiating posture we are taking as far as the global slowdown goes down, all of that is relieved seeing the trade tensions relieved and then brexit, after being in the uk for a couple of weeks, wilf, it is a political mess but it is an economic y2k it's a nonevent.
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they'll be buying equities 10% higher because that's what will happen once we see these trade tensions relieved. >> that's not what the economic forecasts are showing. >> i hope you're right not sure it's consensus. >> expedia said a big drop in europe why are we so far in the season in terms of earnings growth for this quarter and looking forward? >> well, looking forward we are finding more and more reason why we could be approaching an earnings recession when we started this quarter, expectations were for a 6.5% gain in fourth quarter results now that number is 3.4%. a high for the first quarter estimate was around 8% now we're in negative territory and the second quarter is now up less than 2% whereas it had been close to 8, as well. so again, the question is, is it because analysts are ratcheting down expectations because of the trade issue? if that's resolved then maybe we see a ramp up in earnings expectations along with the
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prices in the market. >> but i mean, that framing, sam, you just gave us in terms of earnings was pretty negative. i mean, are your surprised we held up so well where the market is given a big bounce back in january? >> yes well, i can't help but think that those who believe that, oh, this trade situation will be resolved any minute now are like teenage smokers. they think i will stop in time before i get sick but sooner or later if we keep smoking or going through a trade war it will have a material affect. >> how much can the fed make all of this better by being patient? the slowdown, policy risk in trade and brexit now the fed is in a patient mode feels like easier to deal with. >> absolutely, sara. the issue is the fed can fix the temporary sentiment things but they can't fix the more permanent worries. the corporate tax cut running out of steam, the trade war to
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potentially continue for longer. you have the shutdown, the debt ceiling. >> can't they move to easing >> but can't do much of the global growth picture deteriorating and the head winds of the cycle so some of consumer delinquency rates going up, stretching of corporate leverage looking more vulnerable and difficult for the fed. >> jack, in terms of what we get from the bond market, clearly yields slipped significantly that's a theme we have seen internationally. where do we go from here for the u.s. >> well, we have seen lately, of course, asset allocation money out of the fixed income or equities these last couple of days going into fixed income an the inversion right in the heart of that yield curve, it's telling us one of two things, wilf either earnings are going do slow down over the course of the next couple of years, or we are going do see a redeploy. of that capital and more like a spring that's loaded ready to explode. so it's really, you know, a tale
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of two markets right now and the real question is whether it's the trade tensions that are the real head wind holding us back that could be the catalyst that sets everything else in notion and, yes, you know what? i never did smoke but you know what if i was a smoker i would have quit a long time before i became an adult. >> you're blaming the trade tensions as the biggest source of the market worry and so far this year the industrials are the best performing group. wouldn't that be not the case if this were all about trade? >> i think it's because in january and so far we're up 15% from the december 24th low and, you know, the january barometer not only for the market and sectors implies investors expect there to be a resolution energy, industrials and they're expecting interest rates to come down so as a result real estate were the three best performing sectors and three best in january beaten the market by 150 basis points in the coming 12-month period. >> it is all about trade and
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optimism for now reigns supreme? >> i believe so. >> thank you, guys still ahead, much more on today's market action as the dow risks snapping a six-week win streak a top strategist tells us why he's buying the pullback. whether the bezos blackmail scandal could have an impact on amazon's business. we want to hear from you about all of this. reach out to the show on twitter, facebook or send us an e-mail the "closing bell" back after a quick break.
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but only just. jeff bezos, world's richest man, writing a blog post accusing the "national enquirer" of extortion and blackmail for photos of himself. robert frank joins us with the very latest. robert >> sara, amazon shares down about 2% today and a much tougher day for ami, the parent company of the "national enquirer." jeff bezos accusing ami of trying to blackmail him with revealing photos unless he agrees to stop the claims of the alleged extramarital affair was politically motivated. ami saying while it negotiated with mr. bezos in, quote, good faith, the board convened determined that it should promptly and thoroughly investigate the claims and take whatever action is necessary now, ami recently entered into a nonprosecution agreement with the justice department over its involvement in hush payments
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aimed at helping then candidate donald trump under that agreement they can't violate any laws for three years, reports now saying that federal prosecutors in the southern district of new york are looking into whether "national enquirer" violated that agreement in the dealings with bezos shares of amazon down about 5% from january 9th that was the day that bezos first announced the divorce and back then the company stated that bezos would, quote, remain fully focused and engaged in all aspects of amazon. but today, hard to not think that this is not a distraction for him, at least in the short term guys >> robert, i guess this, of course, adds to the details of the divorce which could distract him. where do we stand on that? is that close to being concluded? >> no idea the divorce which seemed like it was ammicible and sorted out that they remain friends perhaps that they had worked out
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an agreement the divorce hasn't even been filed yet so he owns 16% of the company. she could get up to half of that so the resolution of that 8% of the company shares has yet to even start, let alone finish we are a long way off from knowing how that's resolved. >> robert, can you explain the parent company of the "national enquirer's" ties to saudi arabia in the bezos post there's an implication or at least theorizing that maybe because "the post" employed khashoggi and covered that whole episode of the his murder so carefully that that could be a reason behind that. what's the link? >> it wasn't clear in the blog post what the link was but a guest was on cnbc this morning saying prior to 2016 the company was living hand to mouth, that they really were struggling for funds and then did a special
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issue on mohammed prince salman and then awash in cash we don't know whether it was a large amount of money but the implication with that 2016 special issue and influx of cash connecting with bezos' claim today that perhaps the saudis were a source, at least at one time of funds for ami but none of that's been confirmed >> got it. >> robert, thank you very much for that so will the "national enquirer" scandal have an impact on amazon's business? d. bosa has a closer look. >> bezos has nine direct reports, many of whom have been at the company for decades there's andy jassi heading up the most profitable business of cloud computing at amazon and
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jack blackburn with business development. amazon also has a position of a shadow adviser, the role is essentially following around bezos for a year or two, sitting in every meeting, traveling with him, learning all parts of the business these people often go on to run important businesses inside of the company and that role is currently filled by wei gao. now, the same time, though, guys, amazon has seen a number of senior executives depart for newer tech companies like airbnb, snap, wework and amazon shares down nearly 8% this month and most analysts say it's more likely to do with the company's slower growth and bigger spending plans this year that it talked about on the last earnings call. guys >> d., i guess another factor that's interesting in terms of just mr. bezos' total working
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hours per week not all or majority is amazon he does a lot with blue origins and other areas. >> that's right. we know that he travels back and forth between d.c. he has a house there and goes there from seattle like you mentioned. blue origin. the point is that stability is really key here. amazon executives have been there, especially his direct reports for a very, very long time they know how to run the company. and so, what we're hearing from analysts and the investor community is that they don't like it when the ceo is a focus and amazon being, you know, net worth almost $800 billion is well equipped in terms of other executives. >> deirdre, thank you, for laying out the structure joining us are two guests to discuss this looks like you both have buys on the stock. anthony, yours is lower with
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concerns of the quarter. do you ultimately have concerns about the divorce and this scandal and these allegations of extortion for jeff bezos, a major shareholder and ceo of the companies? >> the question is whether or not it becomes a distraction for mr. bezos and also for the nine key directors that were mentioned emergency roomier. there's no evidence of that. and it's really more difficult for me to see a hard line into how this affects the fundamentals of the business i will agree that the quarter, there's deceleration in key high margin business lines but as it relates to the news and the indiscretions of jeff bezos the biggest thing perhaps for shareholders is around the divorce and if there's a 50/50 separation of assets, his ex-wife would have 8% of the shares and i think it is a question for investors of what becomes of those shares. i don't think it's within her
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best interest to dislocate the shares and a more relevant question i don't think it hurts the brand of amazon such to see it affecting the revenue or the growth of the company. if it's headline risk and the stock gets hit in an undo way it could be a buying opportunity. >> anthony, what is the typical trading daily voluntarily of amazon or float? if 8% of the stock is put up for sale, unlikely it would be, but if it did, how much and for how long would it weigh on the stock price? >> yeah. i mean, i don't know the answer to that. i mean, i don't actually think that that's very likely. i think that probably what's more likely, you know, or what's a greater question is the votes that are attached to those shares, right? because basically mckenzie bezos could be the second or just as much of a shareholder as jeff bezos is right? is there an agreement where the
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economic value of those shares can be exchanged for the voting stakes in those shares amazon doesn't have super voting shares i think that's interesting to think about. i think it's unlikely that the shares are sold to the open market not in her best interest either. >> it is a question, tom cnbc crunched the numbers finding that the stock down 5% since the divorce over that period the market is up 5% is this an issue for amazon shareholders >> sure. here are the three reasons i don't see it as an issue for shareholders of amazon number one and most importantly, hopefully by now they have the trust of mr. bezos to the extent that he's succeeding in converting his vision and they have been well rewarded for backing him for all these years. number two, hopefully at the minimum they have come to the terms he owns "the washington post" and is an advocate of free post and as owner draw it is ire of president trump and can be a
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challenge. i think about how as you mentioned with blue origin that he built both amazon and blue origin concurrently from scratch and clearly has the mental bandwidth do do a lot at once and i don't think this will distract him. >> tom, while we again don't expect this particular outcome, i'm interested to know, what premium do you think is in the stock because jeff bezos is ceo if for whatever reason he wasn't still at the company, how much would we see the share price pull back? >> that's an excellent question and almost got the answer a couple of years ago when he was air lifted off a cruise ship in greece i think it was kidney stones the market wasn't open in that time i think it's 10% i would argue about 10% hit and then of the number two andy jassy left tomorrow, a 5% hit and a difference now in amazon that he does have a lot of able-bodied executives around
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him and when you think about the importance of their cloud computing business effort to the business, it's a second biggest loss behind jeff bezos. >> anthony, your answer on the same question? >> yeah. i would agree with that. if i look at the quarter, i think that, you know, amazon web services or cloud computing is 55% of the value of amazon shares and looking at the quarter that's a strongest performer. that revenue growth did not decelerate that 46% at healthy margins, roughly 30%, that is a key part of the business and andy jassy is an important lieutenant in that role and fundamentally the reason why investors are bullish and encouraged, especially in the face of let's say a little bit of slowing in the non-aws side of the business. >> very quickly, tom, do you think they'll pull out of long island city? >> no, i do not. i think if you think about amazon's selecting d.c. or northern virginia, they're very
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shrewd politically and as far as any noise there i think a loud minority that may not want them in their backyard in new york so i think this is more of wrangling by amazon and ultimately they intend to move forward with both new york and northern virginia. >> all right, guys thanks a. lot to talk about with amazon today tom and anthony. we've got 34 minutes here to go before the closing bell dow off 150 points s&p 500 off .2%. russell just popped positive small caps doing better again today and the nasdaq near the flat line. still ahead, the former ceo of another broadband weighs in on reports the trump administration will ban chinese telecom equipment from networks. offering free college tuition. there's a catch. an usunual way to pay for higher education coming up.
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time now for cnbc news update with sue herera hi, sue. >> here's what's happening that the hour on capitol hill, kevin mccarthy holding a first press conference as house minority leader calling on democrats to give president trump funding for a border wall. >> we have the power to come to an agreement where i think the wth would not agree to a national emergency and what the president said in the state of the union. do your job. you have an ability to do it legislatively. the president said i'll open
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government so now's our opportunity and window. syrian opposition activists say government forces carried out bomb attacks on rebel-held targets in the country's northwestern regions. the shelling was the latest in a series of violations threatening to derail a cease fire reached between turkey and russia. and british actor albert finney star of films like "murder on the orient express" and erin brockovich" died after a short illness with those closest to him by his side he was 82 years old. and incredibly talented. that's the news update this hour. >> absolutely, sue i'm fascinated when certain british national treasures are discussed in america to see how well they're known and great outpouring here this side of the atlantic, as well. >> absolutely. >> for albert. >> absolutely. he was a favorite on broadway and also in the movies for
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"annie" so he was just incredibly talented. >> he was, indeed. a legend in many, many ways. may he rest in peace sue, thank you very much. >> you got it. we have some breaking news on wells fargo of course they had an outage which happened yesterday and lasted longer than they wanted tim sloan issuing a statement moments ago and on that topic did say that the recovery of the outage was not as quick as the bank would have expected saying that they have restored atms, mobile, online banking, credit and debit cards to be used normally and some mortgage balances are still not fully up and running i think but they also say that the key thing of this release that any fees incured as a result of the outage will be reversed. the cause of it was a fire in one of their offsite data centers. and that's what caused the shutdown there they felt that they didn't get it back up and running as quickly as they like and the
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consumer response as you expect not positive but in particular elevated because people like to get access to their money and not logging on and not seeing their balances and they worry. >> yeah. >> but they also say all transactions processed. >> impact the stock? >> not really. we saw the stock down along others with a big presence. >> down again today. >> where that merger between bb&t and suntrust affected them most of all. i spoke to a couple analysts saying this isn't an issue for the stock and clearly not ideal for them to have another negative consumer aspect. >> do they have any positive releases >> they do, they do. fair point they want to share these things off, no doubt. we have just under 30 minutes, 27:30 left until the bell down on the dow. a quarter of a percent on the s&p. nasdaq and russell essentially flat. it was the october earnings call heard around the world.
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>> screw the guy so badly that i don't believe that they'll be able to only resign. they will have to commit suicide. so we are going do screw this guy so badly that it will be fun to watch >> cleveland cliffs ceo lourenco goncalves is bk.ac i don't think he yelled at any analysts we'll be back with him in a moment more than half of employees across the country bring financial stress to work. if you're stressed out financially at home, you're going to be too worried to be able to do a good job. i want to be able to offer all of the benefits that keep them satisfied. it is the people that is really the only asset that you have. put your employees on a path to financial wellness with prudential. bring your challenges.
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welcome back iron ore mining company cleveland-cliffs stock jumped today, up some 8. 7%, a beat on earnings, a slight miss. joining us to talk about the quarter, ceo and chairman lourenco thank you for joining us. >> a pleasure to be here. >> let's dive into the bounce and the recovery of recent weeks and start on a macro issue affecting prices to what extent has the disaster impacted the business and likely to continue to impact the prices of iron ore you are seeing >> the impact is indirect for us cleveland-cliffs because we are dedicated to the american market and it doesn't sell here in the united states. that's our market.
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we are geographically protect. the shortage coming in pellets, promoted by the ka it iscatastrn brazil. >> hasn't it had already the price climbed. the stock up almost 80% in 12 months how much more is there to go >> remember, sara, that this week china is out of business with the chinese new year. they will be back in full force on monday. chinese time or sunday evening here and i'm expecting big jumps in both the underlying commodity price and pellet premium starting on monday so it's to come. >> and if we take the issue out of it, you still think there's a lot of momentum behind this anyway is that something that can be offset by the trade war
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escalating or separate from that >> there's a momentum here since tax reform tax reform is the most important thing for us back in 2017 and with great repercussions in 2018, as well. and we're going to carry us into 2019 manufacturing is back in the united states. we are the -- pretty much the sore supplier of pellets for the american industrial. we are having a great three years in a row and thanks to tax reform that's been the most important thing for us. >> last time i talked to you it was because of the earnings call where you went after the goldman sachs analyst pretty hard. apparently you guys made up afterward. >> not really. >> oh no >> but let me correct this once and for all. i didn't go after the goldman sachs analyst. i was going after the ones that shorted the stock for short-term profits.
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>> the embarrassment to his parents? >> these weren't them. not him. >> calling him out - >> to ask a question. >> you called him out a few times. >> yeah. because i like him to ask a question but that was it. goldman sachs is my go-to bank i work with them all the time. i was interviewed by the head of research and the head of commodities during the goldman conference we made up with the bank we're in good shape. >> didn't you have a little clash with jeff curry on the forecast for iron ore. i think you were right because the forecast was too low. >> i made it clear he was wrong. i was right. that's the history of our lives. i have been right. he has been wrong. >> on the last earnings call clearly you said we'll screw them so badly i don't believe they'll be able to just resign but to also commit suicide, the short sellers there. >> exactly right they could have done that today. they didn't so i'm in good shape. >> sure but you're saying you're going do squeeze them. >> i already did. >> right
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by buying back stock and yes, there was a lot of -- the float that was out short and your pe at five times and therefore clear arguments to buy back stock nonetheless, how much have you done of that to generimprove anf you see a big macro down turn to regret and short of capital to meet the debt? >> i just regret that the research profession went down to the way they are right now they act like bots miss, bit. you know in 30 seconds after the press release. >> investors are educated and know that. and consensus has earnings -- i talk about this actually often with jamie dimon we know the estimates and we have to mark you against something. we're not just going to listen to the ceo say buy, buy, buy, forevermore, i'm brilliant. >> it's regarding retail and
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more guys, they follow what the folks write. you have situation today, use one in the call. take a company like lululemon. more or less the same level of revenues and of ebitda they trade at 23 times ebitda we trade at 6, 7 >> people are more jazzed about that than athleisure. >> there you go. we are a lot more strategic, a lot more important in the long run. we have been around 172 years. i will tell you. 100 more years cleveland-cliffs will be here and you're going to be using other brands of yoga pants. >> well, i - >> thank you for coming back on. >> my pleasure thank you for having me. >> did you hear from shareholders after that? >> happy a bunch of happy people. >> thank you. >> thank you, sara thanks, wilf. >> good do see you. >> 19 minutes to go before the closing bell the dow off. unh is a big drag.
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utx is the biggest gainer in the dow. after the break, shares of beauty company codcode. and the legal ramifications of "national enquirer" and the parent company if you're turning 65, you're probably learning about medicare and supplemental insurance. medicare is great, but it doesn't cover everything - only about 80% of your part b medicare costs, which means you may have to pay for the rest. that's where medicare supplement insurance comes in:
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sno . welcome back to the "closing bell." let's check individual market movers coty brand surging after topping wall street expectations the company also said it took nearly $1 billion write-down on the beauty brands acquired from procter & gamble in 2015 shares jumped 32%. >> wow. >> don't let that fool you because this was the single worst performing stock on the s&p 500 losing almost 70%. a huge struggle. took on a lot of debt to buy that $12.5 billion butte toe portfolio of cover girl from procter & gamble they have a brand new ceo and investors and analysts like what
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they hear from him. >> they did today, up 32 rs. hasbro, a very different story for them both from coty and compared to their rival mattel and did well this earnings season and fell after a big miss on earnings citing the first christmas without toys r us. teased up new toys but that fell 1.3%. >> i was going to say barbie made the quarter and hot wheels, too. still to come here on the "closing bell," 40 minutes left of trade with the dow down 146 points but well off the lows of the session. the nasdaq and s&p only slightly negative and talking to tom lee coming up an why he's still bullish. and later on the show, a crisis management expert will be here to weigh in on whether bezos' blog post was a good idea imctez it could pa bos
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want more from your entejust say teach me more. into your xfinity voice remote to discover all sorts of tips and tricks in x1. can i find my wifi password? just ask. [ ding ] show me my wifi password. hey now! [ ding ] you can even troubleshoot, learn new voice commands and much more. clean my daughter's room. [ ding ] oh, it won't do that. welp, someone should. just say "teach me more" into your voice remote and see how you can have an even better x1 experience. simple. easy. awesome. welcome back to the "closing bell." we have 11 minutes left of trade and we are lower on the dow. but well off the lows and s&p's
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only a quarter of a percent now. technology helping the markets. stocks falling for a third day as trade concerns continue to weigh on stocks but our next guest is still bullish on this market joining us is tom lee. tom, some people know you. you have sort of a reputation of being -- that's not necessarily the case bring us up to speed on your recent positions and how long you ian been bullish. >> well, you know, we've been bullish for a couple years last year was a disappointment and i think really december was really the month where the bull case was obliterated but that waterfall decline and the widening of credit and i think a policy error by the fed setting up 2019 to be probably the best year, probability of a double digit year we have a great setup into this year. >> what are you looking at
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people say earnings recession, economic slowdown, trade war risks, brexit uncertainty. why do you see double digit gains? >> those represent a wall of worry. it is valid but the market and earnings don't have to move in sync last year we had great earnings and market derated i think multiples expand this year because high yield has the biggest rally in its history in the first five days of this year high yield posted a decline last year and never posted two consecutive declines in a row. i think you had a huge position adjustment because we had a waterfall decline in stocks. stocks fell almost 20% in 2 months that hasn't happened since 2009 so it's bullish. >> and i guess, you know, the fed pivot is bullish for pes on equities, as well, but the earnings growth downgrades we have seen is not bullish for the multiple people should be getting if growth is single digit this year.
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so -- and we're not at 14, 15, we're at 16, 17. isn't that a concern internationally? >> yeah. it depends on the root cause. if this is trade, causing a slowdown and also lack of visibility, so we have a big inventory adjustment and destocking that's not something investors should put a permanent mpv on, right? it is a speed bump if it's enough to tip us, then stocks have a long way to go down. >> within the overall market, where do you want to be? do you want to be in the cyclically sensitive areas >> we are thinking of 2009 because like 20082018 saw a huge move into defensive growth and everything else got obliterated so you want to own value cyclicals and in 2009 outperformed year to date they're leading but only up by 200 so there's a lot of room. >> what about financials
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is that a cyclical or a value? >> that's a value cyclical, yeah. >> you like them >> i think financials are a high quality way to play this right now. >> the big guys or regionals after what we saw yesterday? >> kind of both, right regionals are m and a stories but the big large cap banks deserve higher pes they produce pretty decent earnings. >> on the international picture, valuations are cheaper there and the macro outlook is getting worse. do you buy them? with these valuations or avoid it with the macro? >> i think value is starting to become more attractive now for managers non-u.s., em is a high value weight index latin m latin america is a big value market so em and parts of europe are a way to play value. >> sounds like you don't expect the u.s. economy to slow down very much because that would be a headwind for stocks, wouldn't it >> you know, i think there's
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some destocking taking place because of the shutdown but we had a 20% decline in stocks, 72% of industries entered a bear market last year a lot's priced in. >> and bitcoin >> yes. >> what is your latest forecast? >> we just published our outlook today for bitcoin. and we just describe how like the ten things that were headwinds last year that became headwinds last year, seven of them are becoming tailwinds. one is i think there's more viz b89 on an etf approval and got a commissioner talking about that today and these things are positive for crypto. >> how do you put a price target on bitcoin you were wrong last year in a big way and how do you feel confident this year? >> yeah. it's tough because it's not priced to book right? it's based on network value so we're declining to establish like a price target but you can think about fair value which is,
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you know, what's the theoretically value of the wallets and being used you know, it's a lot higher than where it is right now. >> you're sticking to the bullish gun there is >> yes. >> tom, greet see you, thank you very much. >> great to see you. up next, we'll be back with the closing countdown and five minutes left of trade. obvious. sometimes, they just drop in. cme group can help you navigate risks and capture opportunities.
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welcome back to the "closing bell." we have a nice little bit of a pop in buying into the close the nasdaq very much close to being positive it is just negative. but start with a comparison of the u.s. versus international. yes, we have been down today and yesterday but we have done better than the international outlook. the dax down a percent the nikkei down 2% hong kong rallied intraday do close only slightly lower. s&p down and better than the international outlook. sectors for you very quickly, energy not doing well. nor is consumer discretionary. defensive doing well tech not defensive. a mixture there. all in all, down over a percent for the week sorry, up over a percent for the week and then oil week to date moved in the opposite direction, down sharply as a whole sectors, therefore, week to date plays that -- energy right at
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the bottom materials doing badly. defensive. >> a couple of them, dollar strength showing up in the earnings conference calls as a headwind difficult repatriating back. trade again today. our eamon javers, turned the market around. 11:45. senior administration officials telling him march 1st trade deadline could change. we lifted up off of it in terms of the market, we got this huge run in six weeks look for fading leaders. there's been moves industrials up 15% energy up 10%. energy stocks faded dramatically this week. a number of a big names like eog down 8%, 9%, 10% down again today oil, of course, topped out that's a factor. they move very, very far. >> nasdaq and russell positive just as we approach the close. bob. i would say that resilient
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relative to some of the bad news and the rest of the world which is seeing bigger declines. germany down for the week. for the week, as for today, we have positive returns for the russell. even for the s&p having a nice little jump into the close it's up about five basis points. dow down that does it for the first half of "closing bell." sara, back to you. ♪ those last few seconds of buying took us positive on the week for the s&p, nasdaq and dow. welcome, everyone, to the "closing bell. i'm sara eisen wilfred frost will rejoin me in a moment along with mike an toly, cnbc senior markets commentator back at post nine where he should be finishing the day on wall street, as wilfred was telling you, as it was happening, last few minutes of trade saw a flurry of buying there into the close which took the s&p positive on the session. pretty much ending flat and
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lower all day long the dow closed lower by a quarter of a percentage point and way off the lows down 63 points today down 286 russell 2000 of small caps outperforming for the week for today and the nasdaq did better than the rest on technology strength today what else worked together? staples, communication services. a mix. energy was the biggest loser here are the stories for investors. trade talk fears of the u.s. and china continue to weigh on the markets. amazon shares are under pressure after ceo jeff bezos accused the parent company of the "national enquirer" of blackmail and market volatility led to money moving into actively managed funds and hitting the stories but first joining us to talk about the market day is jim kahn of wealth enhancement group. mike, quite a little turnaround there into the close. >> it was. >> positive on the week. >> evening at the lows the market was very kind of mild pullback all seems last couple of days
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relatively relatively innocuous it was just essentially drying up of selling, it was not a lot of aggressive downside and you have a market up a lot treasury yields that are sur pressed with what's going on in the rest of the world mostly doesn't kind of add reassurance to accelerate from here just because the growth picture and lacking the additional catalyst of more earnings but it's hard to get too concerned with how the market closed. >> mike, on furthermore, there's a resilience really here whether you talk about the economy or the stock market today or week to date we are doing better than the rest of the world. >> no doubt about it for the first part of this year, let's say the first month, i think all you were doing is reversing the extremes of the fear and the panic that built up since then, i think with yields coming down, takes the pressure off of other asset classes even though i don't think the longer
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term message of having treasury yields, you know, sink to these levels is all that encouraging it is fine for now i think valuation is not cheap. >> so now, jim, a seventh week in the book of gains for the dow and the nasdaq, does it make the rally more believable for those that were saying, look, we had a long way do go after a brutal autumn and final, you know, trading few days of the year last year? >> yeah. unfortunately, it is difficult to get excited about what's to come in 2019 look at the rebound in january continuing into february, a lot of it is in reaction to the fact that jerome powell came out in december and basically said, look, i'm more aggressive in interest rates as a response to the administration and trump's efforts to try to tell them not to be. they'll come out an assert authority by saying, hey, i'm going do do it and then walked it back basically most of sxwran and i think that was a catalyst and a catalyst you get once.
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furthermore, it looks like the trade issues with china continue to sort of bubble to the surface. we think that that's a longer issue to play out primarily because it's all intellectual property and comes out of the trade talks and that's going do stay at the top of minds as a main concern. >> talk more about trade and uncertainty over a trade deal with china impacted the markets again today. the white house officially announcing treasury secretary mnuchin and u.s. trade representative lighthizer will lead negotiations in beijing next week as they attempt to get closer to a deal and the march 1st deadline to negotiate a deal may be pushed back mike, back and forth always on whether it's good news or bad news do you frame this now as the market has more to fall if it gets meaningfully worse than it has to gain once we get an announcement >> yes i think messages of flexibility or trying to find the makings of
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some kind of a deal are probably a net positive i don't know how much we're kind of spring loaded to move higher just if we get a deal. and i do think obviously if there's -- if it ends in hostility, ends in increase in tariffs that's not a good thing but, again, we have been living with it for a year i feel as if we have kind of worked through what the potential implications are in both directions. and i think it's all a matter of what the market feel position is going into that moment up 5% from here and everyone thinks it's a done deal then downside risk, for sure. >> how much of the weakness and the slowdown in earnings that we're reporting on every day has to do with the trade war >> i don't think so much with the trade war but the deceleration of growth in china. if you look at - >> not because of the trade war? >> i mean, trade is part of it and what you are seeing is chinese economy is slowing faster than anybody expected and the news we got in december of
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2018 you look at pmi, any of the leading indicators in china, they're not quite crashing but as close as we have seen in sometime and the president of china has had policys that have favored state-owned enterprise over frequent enterprise and going backwards, not fowards and talking to chinese counterparts and entrepreneurs in china they're frozen out and with that rapid deceleration of growth you are seeing the government take some steps to actually free up credit for entrepreneurs and free market activity and might be too little too late. >> how much is s&p multiples too high >> looking at tech stock multiples clearly too high and explains a lot of why u.s. markets outperformed international markets. looks a lot to me like 1999 where you had a period of time where both the u.s. stocks and tech stocks -- growth
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outperformed value primarily because tech drove both phenomenon. if you look back for five years it is the same case. it's very difficult to get excited about amazon and a pe of 78 backwards looking basis so i think tech has very little room to sort of rise. i think most of the news coming out about tech is mediocre and they feel expectations and looking at value stocks, i look at banks and probably some more room to run and looking at the market it's difficult to see how multiples expand further. >> two themes, strong dollar and strong small caps. they move together is that going to be a longer term phenomenon here >> i would not extrapolate it from one week. you know what i mean i think it's a reflex and makes sense in that context f. the dominant story line is worry about how much the rest of the world is slowing down but to me it's not necessarily something that i would say let me draw a line here.
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the market, the dollar is well supported. no doubt about it. even with the dips it is not that significant so that part of it might hold up i just don't know if this is going to be a small cap year per se. >> let's talk amazon shares got hit today after ceo jeff bezos accused the "national enquirer" of blackmail in a bombshell blog post with alleged e-mails from the enquirer threatening to release photos of bezos not complying with their demands. issue for the stock or not >> maybe just a little bit of a psychological overhang it's not traded that well since earnings as we know and i think the bigger trigger point for a little bit of the selling but it doesn't help i don't think. i think this was -- it did nothing to get people's minds off it right? this was a story to go away and now it's back. i don't think anybody feels like they explain why it's selling. >> distraction is what we have
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heard. >> in the absence of anything else, seems light it's a little bit of a drag. >> jim, you are bearish on amazon. >> two consenting adults doing things in public they shouldn't be tarred and feathered and unfortunate that this is what we're talking about as a society you know if it does become a distraction for bezos and an issue for the stock dub. >> hang on not as a society just because this is about the personal life but because he mutt in a blog post that the "national enquirer" was extortding him this is unprecedented stuff. tied in the media ownership all the way to the white house that is much bigger issue than the personal drama. >> it appears like a personal drama at the moment. two adults having a relationship with some pictures that they're going do release i don't think that's fair play. >> if it does escalate the impression of who hostilities between the government and his properties, i think that's potentially an issue and hard to
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know if we're headed there. >> jim, amazon stock you think is overpriced? >> i still think it's overpriced whether he's having an affair or not. >> that's why i was asking spikes in volatility might be spurring some investors to place bets on aboutivective etfs they drew in $27.5 billion in cash last year and all-time cash and cash into decreased for the first time in five years mike, a bit of good news for active managers. got to start with the flows and follow the performance. >> exactly i wonder if this is just a bit of a stutter step. active etfs in particular not a very big category. a lot of it is kind of smart beta or other kind of rules based edfs going it does make sense
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so maybe this is a little bit of a glimmer that it's not going to be nothing but a stampede into indexes as it has been for a while. >> yeah. i saw this news and yelled travesty this is another way for the industry to extract more money out of hard working people for no value added it is difficult for them to outperform over time and they were losing share and fees in mutual funds and now it's a grab back i think the good news around smart beta and makes sense for clients and a way to reduce fees and portfolios but these active etfs is another way to high fees for low returns and problematic. >> jim, there's been a lot of negative macro data this week. one area we haven't hit on that you note is australia and also canada are we missing that one? what does that tell about the global economy >> it tells you that commodities are having problems with what's going on in china. they're the largest consumer of commodities in the world and has
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a bleedover affect to canada and australia and why it's the story to watch for 2019 and the question is, do they go from 6.5% to 6% 6.5% to 3% going to 3% i think it is a little bit of trouble or chop. the countries like australia and canada probably in for negative gdp growth. >> aussie down like 2%. >> yeah. got some more dovish comments from the central bank. though aussie dollar only developed economy that never in any way debased -- >> headed for recession. >> didn't debase. >> didn't go to recession. >> didn't cut rates. >> island of stability let's see what happens with china to your point. >> sitting on a bunch of iron ore. a reserve backed by iron. >> they need to send gone goncalves there. jim, thank you for joining us. >> thank you. up next on the show, we'll discuss how a possible ban of chinese telecom equipment by president trump could impact the
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industry and u.s. wireless providers. a crisis management expert weighs in on did bezos bombshell and hit the streets of new york to see how people are reacting to the blog post >> i think it's a little ironic that jeff bezos is talking about privacy as the amazon guy, the king of things that are not private anymore for anybody. so but -- i think in general he did a good job. >> it may work in his favor just because i would think that people may feel bad for him being blackmailed and support amazon even more, especially if they don't like trump. he countr. he countr. you see so many people walking around here in their hundreds. so how do you stay financially well for all those extra years? well, you have to start planning as early as possible. we all need to plan, for 18 years or more, of retirement. i don't have a whole lot saved up, but i'm working on it now. i will do whatever i need to do.
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a new report from politico says president trump is expected to sign an executive order next week that would ban all chinese telecom equipment from u.s. wireless networks. the potential ban comes as huawei and zte face increased skrutdny of the u.s. of being possible national security threats and weeks before a major mobile conference in barcelona. >> joining us now to discuss what this ban could mean for the chinese telecom sector is leo hindri leo, thank you for joining us. >> wilfred, thank you for having me
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i appreciate it. >> what's your first take before we get to this executive order as to the likelihood in these accusations that this chinese company and others are often mentioned and in particular huawei is spying on various countries where it operates? >> you know, i think it's a political ploy by the trump administration to be honest with you. there's six major manufacturers of 5g gear two of them are china based. four of them outside the country, obviously if one of them is hackable, if one of them is corruptible, you have to assume that all six of them are hackable and corruptible. and what concerns me and annoys me is that the trade negotiations with china have moved into the emotional stage as opposed to the substantive one. huawei and zte are substantially the same as the other four competitors. taking thm out of the
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marketplace, there will be an emotional price paid by china. they're very fond of these companies and committed to the two of them and see a profit increase in the other four if you take these two off the market but there's nothing to suggest that the technology of huawei and zte is materially different than the technology of the other four. >> but, leo, i mean it is not just the u.s. and, therefore, not just the trump administration making the accusations. in just last the week uk is loud and clear and other countries, as well, that have weighed in on this and just taking a step back, and using the uk as an example, they haven't been clashing with china and trying to negotiate a trade war in the same way so they don't have that incentive to make this up if that's what they're doing as the u.s. does so how do you explain that >> well, it's not obvious that they don't have an agenda, wilfred.
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the other four, we don't know what relationships other ones ha -- countries have had with the four i think it's part of a larger political ploy to politicize the trade negotiations going on. we should all be concerned about privacy. we should all be concerned about corruption of delivery systems but there's nothing to suggest to me that somehow zte and huawei stand out as being potentially greater offenders than the other four might be >> well, i mean, clearly the administration disagrees with you. so if they move forward with this sort of executive order, what would that look like? how much disruption would there be how much sharing is there between chinese and u.s. telecom companies? >> well, sara, i don't think that it's that they disagree with me. i think they have a political agenda in trade that sometimes overwhelms the technical realities.
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from a vantage point of the united states, this would be like china putting hard stops on the boeing company we don't have state-owned enterprises here in the united states but we have companies like bioing that are integral to the economy. huawei and zte are very important to the economy of china. and when you go after them, you go after china itself and i think that it's bob lighthizer's and steve mnuchin's agendas that are -- i'm sorry -- our commerce secretary, i think it's just a ploy -- i don't think it's a particularly well thought out ploy but it will have some affect, certainly these companies are well received as i said by china. >> leo, different question regardless of this latest particular issue, the likes of huawei and zte have drastically improved the quality of their technology and the products they make in the last decade. have you been surprised how
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quickly they've developed and how do you think they've managed it have they copied, stolen ip? >> oh, i think they probably have had some borrowing sort to speak of ip. i think when you're an soe, wilfred, you're able to grow and be entrepreneurials to degrees not common to the public companies outside of china and i think it's simply the nature of the beast in china their technology capabilities are just second to none right now. and huawei - >> better than the u.s.? >> certainly as good as anything we find here in the united states of the six manufacturers of 5g gear, none are considered a true u.s. company. it's fuji, nokia, ericsson and samsung. >> i'm sorry to belabor this
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didn't the fbi, cia and nsa said not to buy huawei and zte phones because of spying? i mean, do you think that's all political? >> well, i don't think it's all political. i think it's substantially political. again, if one of these systems is compromisible, you have to assume all six of the systems are compromisible. to highlight zte and huawei without similar scrutiny of the other four manufacturers and their capabilities is a little shortsighted >> leo, great conversation thank you for joining us. >> thank you for your perspective. >> my privilege, thank you up next, recent ipos more than doubling the performance of the s&p 500 this year. we'll break down the charts to see if that's bullish or not. and a major university in the u.s. is offering students the chance to attend without paying tuition but there is a major catch
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group smith & nephew with pressure of activists to get rid of underperforming businesses and itself had been seen as a possible takeover target on this report, nuvisive shares up 25% in extended trade back to you. >> seema, thank you. coming up, coca-cola unveiling a new first for the first time in a decade what it is and whether the stock could get a pop as a result. jeff bezos says the parent of the "national enquirer" is blackmailing him >> i think his leadership is not in question at all you know he's built a great company changed the way we buy things and he'll get through this. >> there could be a little bit ceioise.gs isserptn su >>he story will have no -- if it has an affect on the business, it will be very small.
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and accessoriesphones for your mobile phone. like this device to increase volume on your cell phone. - ( phone ringing ) - get details on this state program call or visit newly issued stocks like recent initial public offerings and spinoff companies have lagged behind the broader market in the last year and what does that tell us about the state of the market mike santoli at the telestrator. >> once of the things, sara, risk appetites somewhat subdued since about last summer.
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the blue line is the renaissance ipo. newly issued ipos after becoming public held for up to two years the stocks are and the orange line is the spinoff etf. essentially companies that basically spun off of the larger company to a publicly traded stock and you can see the green is s&p 500 we had this big spread over the course of the last year. now, year to date these have come roaring back. if we did show before the break from the lows the newly issued stock etfs outperformed the stock and shows you the most beaten down stuff and aggressive strategies to come back sharply an ennot a new high and this rollover right here we saw that happened slightly before the s&p had its little minor peak recently so it's just one of the things to monitor right now in terms of seeing if a bull market to resume in all facets and some of the more aggressive stocks like ipos taking the lead.
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>> it shows which is hard to measure on the charts but how well the bankers have done in giving away ipos of good valuations. >> that is true. >> you could argue that's a factor of the s&p 500 valuation is at the time and so many in recent years not having a pe at the time of listing making a loss and the year or two ipos rushed out and then maybe didn't hold up as time passed. >> it is true. there haven't been a tremendous number of ipos right? not as if it's a great sampling out there to give you necessarily a read on this but it is -- relatively smaller cap relatively more aggressive the profile. spinoffs by the way is a longer term more interesting story because it was a strategy for outperforming. undiscovered stocks. neglected and then outperform really well and fallen out of favor as i think hedge funds thrown capital in the strategies. >> great strategy. thank you very much. time for a cnbc news update.
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sue? >> thank you, wilf everyone, the house honoring congressman john dingell who died yesterday at the age of 92. he was the longest serving member of congress in history. the house rep for 59 years >> chairman dingell was our distinguished dean and chairman, our legendary colleague and a beloved friend his memory will stand as an inspiration to all who worked with him or for him or had the pleasure of knowing him. new york governor cuomo ratcheting up pressure on the political opponents against amazon bringing the new headquarters to long island city this as "the washington post" reported that amazon is reconsidering the move because of the opposition. >> for the state senate to oppose amazon was governmental malpractice. and if they stop amazon from
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coming to new york, they're going to have the people of new york state to explain it to. >> later "the new york times" reported "the post" story cited two sources saying amazon has no plans to back out. we will see. that's the news update this hour back downtown to you. >> sue, thank you very much for that amazon very much in the news today. we're going to continue to talk about them now as, of course, the chairman and ceo accused the "national enquirer" of blackmail. in a block post bezos detailing an e-mail exchange including alleged threats to publish photos of bezos. >> let's bring in david singolden and firm represented billy bush, data karan and with us is dave aaronburg we'll look at the reputation and legal implications of the story. was this a good move for bezos
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to come out, publicly, transparently and accuse the "national enquirer" of extortion? >> i think it was a great move usually someone is extorted the person doing the extortion to hold back the goods until that person has a chance to buy them back and in this case jeff bezos suffered all the damage for the most part with the family, the colleagues, with all of us, the public and so, once the enquirer went back for round two, they came back with everything. >> that's interesting. if this was two or three months ago, not done that in essence, you're sort of saying that perhaps it's not as gracious what he's done as it looks like because most of the dirt is already out there. is that what you're saying >> had the enquirer gone to him before everything was out there, i don't know if he would have taken the deal. >> what's the view on this and the legality of either side might have done. is "national enquirer" broken any laws in your view? >> first off, you know the adage never pick a fight with someone who buys ink by the barrel
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add to that, never pick a fight with the richest guy in the world. huge mistake i mean, federal prosecutors have signed ami to a nonprosecution agreement needing ami is choir boys while the deal is in place. if this is criminal extortion, they cannot only be charged with the extortion but violating the agreement and maybe ami is more concerned with the jeff bezos investigation of them than the federal prosecutor's investigation of them. >> davidson, what might be the risks at this stage for jeff bezos going this route we don't really know -- ami had a comment on the position. but what are the downsides of doing down this road does he have to pursue it, you know, whatever distance it takes? >> that's exactly right. only real risk for jeff bezos is
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turning out it's not a political hit, not some saudi black box job but just somebody that took the phone and sent it in, it looks conspiratorial. >> we still don't know, of course, how the pictures and text messages were secured in the first place, if they were hacked and they were taken without their permission which it sounds like is the most likely aspect, is it illegal for "national enquirer" to use that information or purely a gift that someone placed on the doorstep and they should run with if they want to >> the "national enquirer" will be certain to use the first amendment as cover to say that, hey, we are using the photos as fair use and we're not violating any laws but if they took part in the hacking, if there was hacking, that could break a law and be a crime if the investigation by jeff bezos uncovers things like, for example, involved money
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laundering with saudi arabia, remember, he insinuated a connection of ami and saudi arabia, all these things could end up in a federal criminal court and too early and scratching the surface and starts with potential extortion and could lead to more. >> we haven't heard ami's full part of this story and we don't know if there's a criminal finding. the evidence is exchanges of two lawyers and what do prosecutors look for to tell whether it's actually extortion and a criminal wrongdoing? >> right as far as the extortion claim, it is not a slam dunk by any means. you need at the federal level two things you need a property that's been demanded and the question is whether demanding an end to jeff bezos investigation of them is property under the law and it could but it's open to interpretation and then the next thing you need is sort of a bad intent here and ami would say, oh, first amendment. it's journalism. but this does seem to be over
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the top and as such a prosecutor could bring a claim but it's no means a slam dunk. >> just want to dig up a sound bite of jeff bezos a couple of months ago at the new york academic club addressing this topic of an important figure and whether or not you should therefore expect to get some pressure and some heat >> it is a mistake for any elected official in my opinion -- i don't think this is a very out there opinion to attack media and journalists i believe that it is an essential component of our democracy. i think there's probably a -- no public figure who has ever liked their headlines. it is okay it is part of the process. you know, it's -- if you're the president of the united states or governor of a state or whatever, you don't take that job thinking you're not going to get scrutinized. you're going to get scrutinized.
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and it's healthy >> that was the economic club of washington, not new york my apologies there davidson, i guess the point i'm getting to is should he have expected this scrutiny but clearly very personal in nature and perhaps illegal? >> i'm not sure anybody should expect the sort of scrutiny of private messages and pictures and other items are taken from them and printed in a newspaper but perhaps in the modern world any of us should expect that. >> what would you advise david pecker right now >> come up with the truth first of all because anything other than the truth will backfire he's operating under a federal nonprosecution agreement, in a tight box for what he does and got to be careful to stick with the truth and needs to explain if this was not the saudis, if it was not a political hit job and just basically felt that he ruined the guy's life and in exchange for giving him back the pictures and the text and wants bezos to stop accusing him of stuff he should explain that now.
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>> that's sort of been their story. >> thank you both very much. davidson and dave. now footlocker made an investment in a sneaker reseller what is behind that move we'll discuss that $100 million investment coming up. free college for four years. it is not some new government proposal it's actually part of a created oal some colleges are starting toffer that story is straight ahead
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dow closed down by 63 points or a quarter of 1% for the week. wee iv posite. 'rback in a couple of minutes for further analysis ooh. so, why don't traders have coaches? who says they don't? coach mcadoo! you know, at td ameritrade, we offer free access to coaches and a full education curriculum- just to help you improve your skills. boom! mad skills. education to take your trading to the next level. only with td ameritrade.
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welcome back here's some of the stories under the radar getting a lot of attention today. i am watching this foot locker investment did you see that $100 million investment in goat group which is a sneaker marketplace an retailer to find hard to find and exclusive athletic shoes this is the whole retail market where they sell for several thousand dollars, that's the kanye west brand and far fetch
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of stadium goods in december for a few hundred million dollars and clearly money in this and bigger brands like a foot locker have to get in on it losing out. >> really -- i interviewed the founded in october and - >> of goat. >> exactly who foot locker invested in. originally a threat of those types of names and they found a lot of pressure from just the shoe manufacturers, not just the retailers and clearly now getting on board. >> reminds me of ticketmaster getting into the selling of aftermarket tickets, scarce and hard to get and marked up. participate both in the original sale and then the scarcity value of the stuff that's really coveted. >> we'll talk again to eddie luke of goat monday on the "closing bell" to talk about what is hot right now and tell a lot of stock price and what brand is working by the resell value of some of these hot releases nike or adidas -
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>> they're shorted i'll bring it up for him for large sizes. >> hard to get in your size. >> not that i'm -- >> in my size, too 5 women, good luck. >> santoli to make it work. >> i have no problem. my story sunday bowl netflix teased the nature series "our planet." with david attenborough. usually just works with the bbc and talked about the move in "the financial times" interview that hit today and said it's over 200 million people, urgent and stays there for months so it can be an even bigger audience through word of mouth. very interesting to hear that from him such a - >> becoming a household name even here. hearing so much about him. >> for sure. national treasure. no doubt about that. he's also always seen in the uk as part of the bbc so interesting. this is not an exclusive move.
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>> do you think there's backlash or discomfort in the uk? >> no, no, no. >> broadening the scope. >> no loved and if someone he went to netflix for money they'd a applaud it. coca-cola adding a new flavor to the lineup for the first time in a decade orange vanilla coke and orange vanilla coke zero sugar available in the u.s cream sickle is what they're trialing to evoke right here they have had new flavors of diet coke. >> helped turn around the diet coke for millennials and go after what's working right now sparkling water. >> fruit. >> it is revitalized the diet coke. >> sounds like something to become somebody's every day go-to flavor. >> sounds sweet. >> too many things in one. >> around the holiday season in the freestyle machines and they
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have data to react and must be consumers liking it. >> good point. even cherry or vanilla coke is too much. >> you know the test >> ginger lime is okay. >> warren buffett switching. >> maybe he rang up an said i'd like a new flavor and if he did the answer would be yes. >> either way. coke has to be careful doing something new like this. this isn't exactly new coke but back in 1985 they did anger a lot of people changing the formula. >> i remember it well. >> regular coke for me. college tuition costs skyrocketing and a well-known university said they'll take care of your tuition for exchange of something down the road scott cohn is in indiana with the details. hi, scott. >> reporter: hi, wilf. at purdue university, a percentage of the income for five years, 5% to 10%. the less you make coming out of college, the less you will have to pay and purdue university's president says that's a way to take some of the risk off of the
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student and put it back on the school >> gives them certainty and some protection and safety. they're not going to have that much more money borrowed piling up piling up compound interest, whether they're doing well or not. >> and i like that it's adjusted for what i'm making, because i think that is much more realistic way to get recent college graduates to be able to afford those loans and keep us out of extreme debt. >> here's what they're talking about. nationwide the average graduate after four years is coming out with up to about $30,000 in debt, and that kind of money adds up. the total student debt nationwide now, $1.6 trillion. they have got no allusions that these income-sharing agreements are going to make a huge dent in that the real key is to do what they have done here at purdue for seven years and that's hold the
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line on tuition. nationwide tuition is rising about twice the rate of inflation. we've got more about paying for college on cnbc.com. >> scott, thank you. interesting story. scott cohn in indiana. up next, giants of the fashion runway mark bagley and mejas mishka unveiling this week. oh, wow. you two are going to have such a great trip. yeah, have fun! thanks to you, we will. aw, stop. this is why voya helps reach today's goals... all while helping you to and through retirement. um, you guys are just going for a week, right? yeah! that's right. can you help with these? oh... um, we're more of the plan, invest and protect kind of help... sorry, little paws, so. but have fun! send a postcard! voya. helping you to and through retirement.
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designers, influencers and editors all flocking into new york for fashion week. badgley mischka presenting their line joining us are the designers behind the brand, james mischka and mark badgley welcome back. >> thank you. >> sometimes the fashion trends on the runway can tell us a lot about where we are in our economic cycle what are we seeing and how does it relate to the overall environment, mark? >> this collection for james and i was a little bit more pared down than our typical collections. we're known fortunes of color, a lot of embroidery, huge,
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sweeping silhouettes i think that our girl, she's more tailored this season. she's a little bit more subdued. there's still beautiful embroideries and beading, but it's more of a laser-cut focus on the silhouettes they're closer to the body and a little more streamlined. >> does the price point come down as well >> slightly. >> does that say anything about the mood right now or the current environment? >> i think it's a little more streamlined and a little bit less superfluous, a little less buoyant than it has been in the past i think we're geared up for a little uncertainty ahead and so we made our collection we added a lot more tailoring too this season. our customer feels like she's more tailored wearing a coat dress instead of just a dress. >> mark, is your footprint in china growing or given a relatively high price point, are you seeing luxury pressure in
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that economy >> it is growing we opened 16 stores in china and are hoping to have 30 by the end of this year it's a great market for us we're very excited about what's happening over there for badgley mischka, anyway. >> do you source any of your product from china >> we do. >> where are most of your factories? >> we make a lot of our product in china we make it wherever it makes sense in the world to make it. we make some things domestically, we make some things in europe but the bulk of our collection, the lion's share of our business is done in our collection division and that's all made in china. >> james, i have a more general question, which is how important is fashion week? i feel like -- it's actually twice a year, right? >> twice a year, yeah. >> and there's other cities, milan, london, paris so how much difference does it make if your show goes well or badly to a year's bottom line? >> it's almost impossible to quantify it. you may get embarrassed if your show goes badly, you may take a
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drubbing in the press. but the collection on the runway is 30 to 50 pieces the collection itself is hundreds of pieces so there's always going to be hopefully, if you are a good designer, the right thing for the buyer is to buy for the stores sometimes the runway has absolutely nothing to do with what's in the stores at all. our collection usually it does we want to show what we're going to be able to show a lot of designers put things on the runway that have nothing to do with what's in the stores at all. >> you seem to have a fix on maybe a more subdued or seriousness among your customers. is that a generalized thing? does it reflect a lower appetite for free spending? how does it fit into the demand for luxury in general? >> it's interesting. where james and i have just come off our banner year of retail with all of our big department stores, we had our best sales in the history of our 30 years, but i still think she's a little bit more cautious going into this season gone is the stigma where women can't wear the same ball gown
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twice to a black tie she's shopping differently but we just -- we just felt it coming, that we wanted to make the clothes a little bit more subdued, a little bit quieter, and a little bit sleeker, more streamlined. >> all right we'll check it out thank you both for joining us. >> thank you. >> good to talk business and fashion with you guys. mark badgley and james mischka. let's have a check in on what the key events will be to focus on next week it will be another big week for earnings restaurant p brands, diamond offshore and vornado realty will quick things off tuesday small business optimism and trip advisor, groupon. >> wednesday brings january consumer price index, we will get the weekly jobless claims report and the january producer index on thursday as well as
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earnings from coca-cola, cbs, nvidia and applied materials the week wraps up on friday with retail sales, industrial production data and earnings from pepsico, deere and newell brands >> i do feel that the economic numbers might be a little more prominent, just because in this last phase of earnings season, i feel like a lot of the stories are already in place we have been, you know, starved for things like consumer price index -- >> it's all with the shutdown mess, isn't it >> i think the numbers will get a little bit of a pass unless cpi surprises to the high side and all of a sudden you have treasury yields at five-week lows. >> the main thing i'm watching next week is asian trade we did have hong kong open today and japan open today japan was down 2%. hong kong opened down 1.5 but rallied at the close
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sunday night, we haven't had trade for a week in china. >> we keep hearing the consumer is in great shape. that should help. >> that does it for "closing bell." thanks for watching. have a great weekend. >> "fast money" begins right now. "fast money" starts right now. live from the nasdaq market site overlooking new york city's times square, i'm melissa lee. tonight on "fast" stocks under pressure again today and there's one winning sector the chart master is sounding the alarm. he will be here to break it down. plus it is a story all of wall street is talking about amazon ceo jeff bezos including "the national enquirer" of blackmail. we start with stocks staging their longest losing streak of the ear. the dow falling for the third day in a row, managing to eke out gains for the week but take a look at a potential canary in the gold

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