i hope you join me on "closing bell" at 3:00 eastern time. he covers apple and it's his first interview since his earnings report and you'll definitely want to see that report and amy kong, as well and i'll see you in just a bit. steve weiss, final trade. what have you got? >> alphabet. today is a great day for it, so maybe the bottom's been reached on this one. >> all right. sarat? >> paypal earn, coming up and new cfo and i want to see what they have to say. >> fiverr and it sets up well for the interview. we'll see all of you then on "closing bell." "the exchange" is now. ♪ ♪ thank you, scott. i am brian sullivan in for kelly evans pretty much all week. here's what's ahead. more good news on the economic front today and more pushback on

premature rate cuts from jay powell. where does that leave you and your money? plus, ai needs h20 and that's putting this company in a pretty good position. it also just moved into a top ten spot on cnbc's just 100 list. the name and the ceo ahead. and a new quality concern for boeing witness again involving supplier spiro aerosystems and the company on deck to report. we have the action, the story and the trade for that stock and two others in earnings exchange and we'll get to all of that and we'll get to today's markets and mr. dominic chu and the numbers are in a lot of red. >> it's not really pervasive and not terrible yet and we're a quarter of a record away from the last couple of days here and right now the dow industrials are down .75% and the s&p 500 is at 4944. it's down 14 points and roughly one quarter of 1% and to give you an idea at the highs of the

session we were down one point and down 40 points at the low and considerably off the lower part of the intraday dating range for the intraday 500. so keep an eye on that. the nasdaq composite if you're only down one quarter of 1% and 15,588 right there. where we are seeing action in the last couple of days on the heels of the big fed rate meeting is interest rate. we'll focus you on the long-term ten-year treasury note yield. remember, that move higher off the cycle lows that we see here and just about 3.79% of those lows and it's been quite a move here and just in the last couple of days and today specifically shot up notably higher and rate cut expectations and how the economy's playing out and all of that stuff factoring in to at least a move lower in rate shorter term and the spike higher over the last couple of days and we'll see if the trend plays out and caterpillar shares and earnings beat, generally speaking and you can see they're up about 2%.

revenues were amiss, but in this story here, and caterpillar which many consider a global bellwether because it's heavy machinery is used all over the place and all of the infrastructure and construction spending here is outweighing a lot of the negatives from the pullback you're seeing at other places and emerging markets and that sort of thing and caterpillar shares up 6.5 points right now and 2% to the upside and it's roughly 40 to 50 points in the is up idea and caterpillar a big stock to watch. i'll send things back over to you. >> dom, thank you very much. the odds in march for a may rate cut continue to go down. the odds for a june rate cut are now at 94% and that is when your next guest sees the first cut, as well and while she only sees three cuts in total this year she also sees catalysts in place that could see the next leg of the bull market. katrina simonetti, senior v.p. of morgan stanley private wealth management and katrina, good to see you, specially in the

daylight hours and what are those other catalysts that you see? >> thank you for having me on the show. it seems that the market is, you know, all involveded in trying to figure out exactly what the fed is going to do which is, of course, impossible. we know we are not going to have any more rate hikes and we know rates are on their way down, we just know exactly when this is going to happen and jay powell on the most recent address said that the march is most likely to quit and that they have to be patient given the strength of the economy. so we have to wait for the data to come in, and see if we actually are going to see the sufficient economic slowdown, but our call is the rate cut in june and all in three rate cuts for the year. >> okay. if we change the rate cut forecast again because let's be clear, we were at higher odds

and just because wall street has 94% chances in june that could be adjusted back either way. we already readjusted in the last week or two what if that three rate-cut chance goes down again to one or two or zero? >> that's absolutely possible. i mean, zero is highly unlikely because we -- there are expectations that you know, they are going to start and build into the easing mode so most likely we're going to see some rate cuts, but data will have to be supportive of this and we see the earnings that are coming in somewhat mickexed and when we l at the sectors and that are overall positioned this year. we see a lot of opportunities specifically in sectors that are embracing digitization and the cost-cutting through the use of artificial intelligence and this doesn't just deal with technology and the symbol is health care and industrials and

financials. so of course, there are expect eggs thex expectationses will be more supportive of success, but the fed will do what they will do and as jay powell said they have to be patient. they have to wait for the data to come in and that's most likely what they're going to do. >> yeah. crazy times. i mean, you've got increased conflict in the middle east. you've got china's economy, by the way, which looks like it's just spiralling into some doom loop. we'll do more on that on the 7:00, as well and why that may matter. do you focus on the middle east? do you focus on china or do you mostly focus on the domestic economy which by many measures is doing quite well? >> of course, brian, we can't forget this is also an election year. >> what? >> add that into the mix, and the geopolitical climate is one of the toughest that we've seen in years which throws in neither

a wild card into the mix and the market has to be very conscious of that, but from the opportunity perspective, we're looking at defense companies and their positioning. the satellite surveillance companies, and the cybersecurity companies is something that investors might want to look at and add to their portfolio, and with that said, of course, investors should not make any drastic changes to their portfolios based on what fed will or will not do. we know that. we tell our clients to focus on companies that are efficient, positioned to make money because of the cost-cutting measures that they've taken before and these are the types of quality companies that are going to get rewarded this year. >> are you a big believer in the magnificent 7, katerina? or are you one of those people that is all in on that? it doesn't sound like it, but i have to ask because everywhere i

go, every uber driver and every restaurant that's all people want to talk about. it feels like it's 1999 again. >> right. it's a fair question, and i think it's hard to argue with the fact that technology plays a huge role in the success of profitability of the other sectors like financials or health care, and so absolutely, we encourage people to continue owning technology despite the valuations because it's going to play a huge role in the success of portfolios, and we also can't forget that historically following the rate cuts, the large-cap tech has performed well and that might be the other boost to that sector, not that it needs any more boosts. >> katerina simonetti, also good to see you. thank you for coming on. let us drill down deeply into one sector that's energy. when you say drill down you know we'll go with energy. most energy stocks moving lower due to a drop in lower prices

regardless of what's happening in the middle east and the sector for stocks down 3% since the israel-hamas war and other disruptions and the shipping in the red sea began. occidental petroleum vicky holland addressed them earlier from the swede investor conference in arizona. >> they're causing re-routing of ships. they're causing shipping rates to go up, so it's more of a disruption in terms of delivery than it is in terms of price. now price right now in the near-term is -- is really driven down by oversupply, but again, this is a short term demand issue, but it's going to be a long term supply issue. >> so now let's head back to that conference for reaction from longtime investor and energy investor and occidental shareholder bill smead. he's chief investment officer of smead capital investment and just happens to share a name with the conference.

it's amazing how that works. thanks for coming on. >> thanks for having me. >> it's truly remarkable that given what we talked about, what vicki talked about and what you and tyler talked about and oil's in the low 70s. what do you make of it? >> you're dealing with two issues. the first issue was that the low in april-may of 2020 for commodities especially oil and gas was a 220-year low relative to common stocks and then you had a nice, explosive upside from the middle of 2020 through the end of '22. if you go back and look at past commodity super cycles one being 1971 and 1981 and the second one being the bric trade in '99 through 2011 there was an initial burst in those and then a one to two-year intermission period. we are in the intermission

period of this particular cycle, but the result, we expect to be very similar to the other ones where most of the gains came in the second half of the super cycle once reality sets in. >> when is this reality going to set in? i mean, we've been kind of waiting for the setting in, and opec cut, the saudis are cutting, russia's output has not been good and iran had been selling more and we know that. brazil's been up, as well and the u.s. is over 13 million. it's quite the sort of epic, global duel. >> well, yeah, but we haven't restocked the strategic oil reserve on top of that. so we don't worry too much about the short run. you know, we're very long-term investors with the concentrated portfolio. so when we're looking at is we expect to get wealthy in the oil business over the course of the next ten years. here's how i think about it, brian. the first tv show about the oil

business was jed clampet and beverly hillbillies in 1963. you wanted to sell all your oil stocks in 1981 at the top on who shot j.r., the tv show "dallas" about a wealthy, private oil company. we don't even have a tv show about the oil business yet, and so that's where we are in the cycle in our opinion. >> we forget that the second rolls royce dealership in the united states, the first was in beverly hills. the second, not in new york. it was in midland, texas in the late '70s and early '80s. it's no longer there, by the way. bill, we know you like oxy because vicki is there and you're a shareholder. are you going into the oilfield services companies, some of the oil players and some of the midstreams? >> we -- we're dealing with what i consider to be circle of competency and i -- i don't think that you won't make really

good money in the oil services side of the thing, but with the major european and international oil companies in kind of an esg coma, it's not as good relatively, i think. see, to us, the oil and gas especially making electricity out of natural gas the next ten years is the addictive legal drug. so we look back at peter lynch's great record and philip morris being the best-performing stock from 1970 and 2010 on the entire nyse as the people divested the tobacco business and that's where we see us. we are just a part of the way into a wonderful era where the resource is very much needed regardless of whether you see a quick transition to elected vehicles or not, and the prices are going to go way higher over the next ten years as the scarcity issues kick in. >> by the way, this is what saudi arabia's been saying.

it's most of what opec has been saying which is this underinvestment in the sector because people say, well, we're moving away from it so why invest in it? you look at coal. the world has never used more coal than it's using today and there's a lot of people. whatever you think of it, you can hate it. there are a lot of people getting really rich on the coal business because everybody else, sort of the, quote, responsible players left it for dead and that's sort of the analogy that you'ri you're making, though. >> there were 49 nuclear reactors before fukushima and there are now seven. japan coal fired electricity. china is 70% coal fired. india, 70% coal fired and germany is more than 50% coal fired. we are shutting our coal fired and the chances of the coal fired which in 2022 is 19.5% being replaced by wind and solar is highly unlikely just to

replace when you're going to lose in coal fired and that doesn't count the fact that the demand for electricity is going to explode the next five to ten years, hence -- the irony is, the most depressing thing in the industry is how cheap natural gas is, but we look at that as our opportunity in the stocks. >> nbc news did a great piece over the weekend how the northeast may have shortages of energy when it gets really cold and really hot because they don't have the gas. america has the gas. the northeast does not have the gas. bill smead. smead capital management, thanks for joining cnbc out there and tell tyler see you again soon and see you that afternoon. arizona is not terrible this time of year. why mickey ds is losing investors. another day, and another all-time high for nvidia, but are there warning signs creeping up? that's next.

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all right. welcome back. mcdonald's, they missed sales and that's the first time since the pandemic. who do we do? let's dive deeper into the numbers and what that tells us with andrew charles, senior analyst at t.d. cowan. good to have you on the program. yes, mcdonald's overall sales were maybe not what some had hoped, but is this an

international or middle eastern issue? because it looked like the u.s. did pretty well. >> hi, brian. you're exactly right and it is a middle eastern and european issue and really in the middle east where there was a big miss in the international developed license market and that was a market that's more exposed to developing market and the middle east really set that market back. it's off about 1200 base points in the underlying basis and a big slowdown there and unclear with the resolution when that will improve and most folks were pretty pleased with the u.s. number better than we expected, as well and pretty much in line with the published consensus estimates, but the vibe was there and there will be a miss there and some pushes and pulls in the release and the middle eastern dynamic is clearly stealing the show. >> the stock's up 35% since just before the pandemic hit. just down today and just off of all-time highs and how do we head this from an investor's perspective? >> they have the great u.s.

playbook and on the u.s. side their scale is benefiting them through investments and then playing offense in digital as well as value in marketing and i continue to see this fly without working for them in the u.s. it will be more back half weighted from where woe're seeig the upside and i like what they're doing in terms of the u.s. playbook that has worked very well for them. in europe it's about a third of the profits so it's a big ask k and key mark for them and in europe we're seeing strong results in europe with the uk and germany, as well. france is the one that's the most challenged where they're seeing two consecutive quarters and they talk about a slowdown there. they're acting with a sense of urgency to improve it, but prance is obviously a key market for them and outside of the united states, about 11% of their profits and so we think that france will take some time to improve, but broadly speaking europe is holding up nicely

outside of france. >> yeah. i mean, mcdonald's obviously, it's a restaurant company, but i learned that mcdonald's is a rent collector. it's a quippy thing to say on tv, and it's true for burgers. >> you must have seen "the founder". >> michael keaton. the real estate ownership is something they prioritize in the key marks where they continue to want to sublease that to the franchisees. they have the strong dynamic of the real estate ownership clear and the clear balance sheet relative to its peers that the investors certainly value. >> what's the best -- they hate the term fast food. what's the best fast food play, andrew, in your coverage universe? >> we like qsr, the parent company of burger king. burger king has lagged in the last few years and had a

fantastic 2023. we think they're just getting started. we think there are a lot of plans in action for this brand on the menu side, on the marketing side as well as less value or smarter value that they're deploying in 2024. i like that one while tim horton's in canada continues to execute and our quick service is domino's where we think it's a nice turnaround story for 2024, comps poised to accelerate there that we're excited about there, so qrs and dominos are the best napes. >> qsr and the ticker not just qsr and the industry in general. they have tim horton's too, i think. i wonder where does burger king fall in? they're not mcdonald's and what makes them so interestingright now. what are they doing? the whopper? >> that's a big piece of it. >> really? >> it's a large bread equity for them? something that they historically in recent years had discounted too much and are putting it back

on the pendulum, with less innovation and less discounting to improve the brand perception and you'll see the jingle, as well and the marketing efforts that have improved there so that's been stuck in my head for sure in terms of the jingle and something you'll see more of going forward with more advertisements and investments going forward. and we like the acquisition of carols and the largest franchise in the u.s. you will see a faster cadence of remodeling. so we really like what we're seeing there, as well, with that play. >> andrew charles, t.d. cowan of mcdonald's, but likes domino's and the parent of burger king. andrew, thank you. have a great day. >> you, too, brian. coming up, mortgage rates on the move and diana olick on what is ahead for housing and plus, call it beauty and the beat. estee lauder moving up, but sending some people out for good. that story ahead.

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all right. welcome back to "the exchange." a big move in mortgage rates this morning and more on rents. let's find out what's happening in housing and go straight to diana olick over the magic of television waves, diana. >> that's right. the average rate of the 30-year fixed crossed back over to 7% to

7.48% according to mortgage news daly and thanks to a surge in bond yields and it made the biggest jump on friday after the labor department reported a much higher employment number than expected and the ism came in higher than expected this morning and the fed has kind of made it pretty clear that we do not expect a rate cut in march. so the 30-year rate hike hit a 30-year high last october and fell sharply hitting a recent low of 6.6% at the end of december. so potential homebuyers had been getting a little break. now it's getting harder again. on the bright side, rents have now fallen for the sixth straight month according to the february rent report rents nationally fell 0. 3% to 1,073 and this is seasonal and sharper and longer than usual and the nati national vacancy rate is slightly higher than the pre-pandemic average. the average rent is more than

$300 a month than it was three years ago. rents are down because a record number of supply is coming online, but camden property trust which recently reported earnings noted that apartment construction starts are projected to plummet in 2025. so then everything gets switched back, brian. >> yeah. it truly is remarkable because we're talking about the federal reserve every day obviously with regards with the housing market and it probably matters to a lot more people than the stock market does respectfully to all investors out there. you know, i think what the fed does there is just going to be this seismic shift potentially for housing which is it fair to say has just completely stalled at this points? >> well, 2023 was the worst for sales on record since 1995. so that was 2023. the expectation was 2024 was going to be a little bit better because rates were coming down and they were in the 6% range and some were in the 5% range and a little more supply was

coming on the market and the homebuilders and you're talking stocks, and the builders have been doing well and they're still not building where they need to be and they're still cautious and worried again about mortgage rates and they have to buy down the rates for their consumers. 2024 in my mind is still kind of up in the air for housing and we need more supply even more than we need lower rates because more supply helps to ease prices. >> diana olick in d.c. appreciate it. let's get to courtney reagan for a cnbc news update. buckingham palace reports that king charles has been diagnosed with cancer and he was treateded for a prostate enlargement and the palace says the king will continue as he undergoes treatment. the news of the trip was first reported by new york times and comes after news that secretary yellen's trip to the country later this year.

the high-level team led by the undersecretary for international affairs will have conversations about china's trade tactics, specifically the country's use of unfair economic practices. it has angered many in washington. and a south dakota tribe is banning governor crist noem for her recent comments on the u.s.-mexico border. the president of the tribe blamed noem's use of the word invasion to justify sending national guard to the border. >> courtney reagan, thank you very much. here is your last look at today's mystery chart and it is also the first look and the first chemical company to crack the top ten of any just 100 list and a pretty big move considering it ranked number 325 just four years ago. we will reveal the name and talk to the ceo after the break, and during february we are celebrating black heritage month. here is intel chief legal

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♪ ♪ all right. welcome back to "the exchange." the annual just 100 list is out today. it ranks america's biggest publicly traded companies on the issues that the public sees as just behavior including better wage eben fit, racial diversity and sustainability goals and coming in for the first time in the top ten after coming in at 24 or 25 four years ago is ecolab. it helps companies conserve vital natural resources like water and the need for data centers have grown, as well, so has the demand for ecolabs services. data centers need cooling systems which need a lot of

water and ecolab helps clients help operate the cooling systems in the most efficient way possible. joining us now is christoph beck, chairman and ceo of ecolab. christoph, con grants not just on making the list because most companies don't, but tell us how you went from number 320-whatever to seven in four years? >> thank you so much, brian and thanks for having me. we are honored, obviously, to be up there and we've been a hundred years in business and we've been growing fast for a long time and it's not so much what we do that is strange, but much more the demand for what we do. as explained before we deal with water and infection prevention and we have millions of customers out there protect what's vital. last year alone we helped protect 1.4 billion people from infection and food production and we did all of that by helping our customers reduce enough water for the drinking

needs of 700 million people which means they could reduce their cost as well for the first time. so in short, the demand of what we do is more needed than it's ever been. customers need us. they need more of our solutions and our impact is bigger, as well. so while we grow, we help our customers reduce the impact and improve their performance at the same time and it may be one of the reasons. >> yeah. pretty amazing. i don't think we've ever seen this kind of move in a company up the rankings, as well. how do the employees react? how do you share this information with them? what is the mood and sort of the vibe inside the company? >> we're in a very good place, and again, it's been for a long time. in good times and more difficult times our purpose of protecting what's vital and people from infection and natural resources and you're driving our 47,000 great people around the world

every single day because they know that what they do has a major impact on our customers, on the environment and at the end of the day on our performance, as well at the same time. so doing what's right the right way and what's been driving us for a hundred years and will be driving us for the next hundred years. >> we mentioned it briefly in the intro christophe, the role of what you do, water cooling, to ai to data centers? >> it's a great question. you know, those new technologies, electrification or digital technologies all need much more power, obviously. they need more power. they need more cooling, as well because computers that are computing a lot and managing a lot of data, they create a lot of heat and you need to cool down the heat, as well and those are the technologies that we are providing to the high tech companies everywhere around the world and interestingly enough and many of those data centers are semi production, as well is

in places where there's not much water to make it even more challenging, but the very good news is that most of those companies are committed to do it in a way that is as neutral to the environment as it can be and we have all of the solutions to them to get to netzero the quickest, possible way. >> i think you just nailed it and christophe, to me, i talk a lot about energy because i say things that they don't like and it makes them feel uncomfortable and you nailed it. say i want to build a giant data center or whatever in nevada because it's cheaper land and plenty of natural sun light to help power the data center. that's great, but then what most people don't think about, while it does have a lot of sun light it doesn't have a lot of water and there is no real solution. some of the areas that we want to build this stuff in because of the cheapness or abundancy of wind or water or solar, you

don't have the water to cool it. >> that's right. we don't have all of the solutions yet, but we're clearly working that by, say 2030-ish, we'll be able to have data centers that are water neutral which means it doesn't mean that they don't use water at all, but they reuse the water eternally as well in their own operations. they operate like nature to us. we've been using the same water for millions and billions of years, as well and we're a data center down the road so we'll be doing the same and we're working our way toward that and we begin with the consumption of data centers and we see it as we speak and that's why we're today on we know that by 2030, we would have reacheded that and the way you describe them in a way that they promote more comp computing water and that's the interesting catch, as well at a much lower cost. many people think that

sustainable solutions come at a cost and we've been demonstrating for a hundred years. when you think about it, in 1923 was economics number and that was the business idea and ultimately, you can reduce the usage of natural resources and reduce your cost and operate better which is contrarian to what most people had in mind right now. >> fantastic stuff and by the way, up in st. paul, you have plenty of water to have beautiful, crystal clear lakes and i heard there are 10,000 of them. christophe, st. paul, nice people there. thank you very much. appreciate it. congratulations. >> thank you so much, brian. good to see you. >> moving 325 to seven in four years. wow. coming up, the chip sector ms. bee has been on fire, but did you know it's the sector with the least eps upside and how that could be raising the stakes for a little company called nvidia. that's next. eps upside and how e

raising the stakes for a little company called nvidia. that's next.

♪ ♪ all right. welcome back. shares of on semi have it going on today soaring on a fourth quarter beat although the company did issue weaker than expected guidance for its fourth quarter. deirdre bosa with what is expected for the second half of earnings season as part of today's "tech check," d? >> brian, weaker than expected expectation and that's been a theme for the chipmaker on semi. more traditional analog chips and also for ai players like amd and intel, as well. of course, expectations coming into this earnings season have been sky high. so even if amd threw cold water on those expectations it is still the trade of 2024 and then we have to look at the other tech outlooks because those actually bode very well for the chip sector as a whole and let's look at capex guidance and that's amazon, microsoft andal

fabb alphabet and meta also expected to leak capex spend to the server here's how morgan stanley put it. they updated their cloud tracker post results last week now pointing to 26% year-over-year growth and that's up from 18% prior, brian. goldman sachs, put it this way. forward-looking commentary on gen ai spending and all of that capex certainly bullish for the likes of anet and amd and marvel, broadcom and nvidia which reports later this month. so the gravy train can keep going, brian? >> it could, and what's interesting about the on story and i interviewed the ceo a couple of years ago and nvidia gets all of your attention and amd, but the thing about the chip space is that we just tend to lump them together and they're so different. they do totally different things

and they're lumped into the same group. >> it's also amazing and when you looked at the year in 2023 because we were so focused on nvidia which tripled the market cap in a year and we had the ai players and the picks and shovels and you're right, brian, the totally other side of the chip sector was analog that did not do so well and on semi, and for some of the more traditional plays, as well which will help the chip sector this year, and you know, it's funny because even a few months ago we were talking about the advanced ones will create more competition and the hyperkalers keep upping their cap sxeks there could be more room not just for the ai players to your point. >> are you getting ramped up for your immediate earnings? is the san frant pran entrepreneur bureau getting set up for the mayhem? >> we have a chepd ar, and we check it off buzz it's so

exiting. ? it's leak something out of the shaw hank redemption. deirdre bosa, thank you very much 37. on deck, new problems at boeing and once again involving its supplier spirit aerosystems getting set to release numbers and we'll have that story as well as the trade on that as well as two more names ahead. ♪ ♪ every day, businesses everywhere are asking: is it possible? with comcast business... it is. is it possible to help keep our online platform safe from cyberthreats? absolutely. can we provide health care virtually anywhere? we can help with that. is it possible to use predictive monitoring to address operations issues? we can help with that, too. with the advanced connectivity and intelligence of global secure networking from comcast business. it's not just possible. it's happening.

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welcome back to "the exchange." earnings, of course, roll on and let's look at three more names getting set to report. the first is a company you probably haven't heard a lot about until recently spiro aerosystems and we are talking about spotify, and here with the trade is nancy for that, we'll go to villalobo on what, now, is happening at spirit air systems. phil? >> hey. it's another problem they have flag for boeing with some of the 737 max fuselages they have

shipped to boeing, and a worker and spirit did flag that two of the holes in one of the parts of the window frame may not be drilled to the conformance standards. as a result, boeing will inspect about 50 undelivered 737 max planes. if they have to, they would do we work on the fuselage. bottom line is, because of this, it may delay deliveries for those 50 max planes that will also have to be inspected with 40 or 45 that are in service right now. this is not a flight safety issue for the ones in service, but this speaks directly to the problem that we have talked about for some time, brian, going is tied to the quality coming out of spirit. boeing has its own quality control issues, it doesn't help that there have been major problems with the quality control coming out of spirit, and that is personal with the issues at boeing when it comes to the 737 max. >> yeah. again, phil, put into

effective, relative some other issues, well known other issues that we have seen so far, where does this sort of rank with the max? by the way, i should look back on a max of 9 from houston last night back from newark, and like you, i want to know what plan i am on. i didn't think twice of it. are we now getting back to think about it? >> i think there are going to be some people that think about it. most people want about it. look, the planes that are in service right now -- i will get back into your question -- the ones right now that are max planes that have been inspected and are good to go, they're good to go. not like they're saying, whatever, put it back in service. they have been inspected. they're up to standards. the issue, when it comes to the current max fuselages and the potential delays, not as big as the door closure issue, front and center with the faa and ntsb investigation, but it does speak to the quality control issues that have led to a number of delays when it comes to max deliveries the last couple of years.

a lot of those can be traced back to the fuselage production problems coming out of spirit's facility in wichita, kansas. >> phil le beau, appreciate it. welcome in now, nancy dangler. nancy, taking a flyer on spirit air systems or staying away? >> i saw your tweet last night, brian. very brave. very brave. listen, i think there's a big problem here. phil totally nailed it in his discussion. it is a quality control and cultural problem. since the first crash, this stock is down 60% in october of 2010. down 60%, averaging free cash flow that's only going to get worse, as we see delays of some of these planes now on the fuselage issue. they're in contract negotiations with boeing and airbus. as an interim ceo, which is exactly how we saw a ceo of boeing, i think there are

better places to be. you've got a pop and stop from last week. i would run for the exits. this is a sell and buy. >> so, and review cannot be more direct. i didn't even think twice about it. some people do. by the way, faa administrator michael whitaker, just breaking news. i will put my hand to my ear. michael whitaker, faa demonstrator, will be on "squad fox" tomorrow morning at 7:00 a.m. eastern time. obviously, talk more about that .i would also like to ask them why they built the security checkpoint at terminal a north, but that's another issue. next up, spotify with stocks were more than 80% last year. the middle of the cost of incurring push with a bunch of layoffs though. people are focused on their premiums, subscriber tier, numbers, and yes, there's the taylor swift effect, and family, she announced a new album last night at the grammys after winning pretty much everything. do you own spotify? are you thinking about owning it? if you own it, do you want to

sell it? >> we own it and we are hanging on. i don't think you want to chase it. it is expensive on the even-. >> basis. we use relative bases for sales, you're right. cost cutting is crucial. also, they're monetizing podcasting, which i think is important. this management has been fitted with the joe rogan contract renegotiation. they have done away with ecstasy ready. they are spending on other and revenues on other platforms that should prove to improve genetically. free cash flow is very strong. the management has a new cfo that we think will continue the discipline of cost cuttings and expanding margins. on weakness, i would buy. if you own it, it's a hold. >> moving on. we talked about semi conductors, nancy, but they are also different. we talked about it with phil le beau, let's talk about an xp, semiconductors. good run the last few months. morgan stanley said, each of

correction, but talked about how and xp 's -- if it happens -- could be saved from any downtrodden. kind of goes to the point, nancy, not all chip companies are the same. what you see? >> we will be buying more on weakness. we own it. i will say, the company has been very disciplined on inventory management. they have got about a month and a half of inventory in the channel. they're going to raise that to 2 1/2 months, which will really provide support to revenues to the tune of about 500 million this year. they have really been aggressive in raising the dividend, 52% annualized the last five did years. should get an announcement today in the 20 to 25% range, but what you really want to focus on with all of those is even if the auto segment is flat to 1%, which is 55% of revenues, there were more chips going into every combustible engine car and ev. we think that will also cushion some of potential slowness. we would like to stop and would be adding to it. >> cards are basically

computers with tires on them, and they are constantly bringing and bonding you to death. nancy, broader markets. there is always something going on, but we're basically sort of at a proxy war in the middle east in some ways. every day now, some missile attacks. oil is not moving on that, but what are you watching most closely? is it still just all about the federal reserve? >> i think that is the one thing that investors are looking over their shoulders about. but so far, we have seen nothing. i have drawn an analogy between the 1990s and this market with this economy, and there are many similarities, not the least of which was a war, geopolitical shock, and the inverted yield curve, soft landing, the 10-year, trading between 5 and 7% the entire decade. we had a shortage of workers, productivity improvements. i do think, underlying all of this, the u.s. economy is the best place to be, nd we will continue to see spending on

technology, which will drive productivity. even in a name like mcdonald's, which talked about how the middle east hurts sales. you are seeing the benefits of digitization. >> nancy tengler, time to a nine seconds left in the program. be well producing. "the exchange" getting ready for "power lunch." if she is happy, i will join her if she will have me. that is "power lunch," on the other side of this quick break.