, >> welcome to power lunch. this is leslie picker, i am tyler mathisen. glad you could be with us, inflation situation. this is producer price index, coming in otter than expected compared to last month and last year. market seem to be taking this upside of pressure in stride. leslie. >> double inflation could lead the feds to relieve rates higher for longer. borrowing cost a elevated.

americans are buying more expensive cars, financing, them paying higher insurance to. we will look at how that trickles down into the economy. but first, let's get a check on the markets. look at that tyler, the downturn positive, i think the second i sat down. up about 20 points. so we will take that. for the week, the nasdaq, likely to close lower. but the dow might be able to get again. if so, that would be 15 out of the past 16 weeks. only one down week since the end of october. that seems like forever ago. leaves on the trees. >> we have a host of stocks making big moves following their earnings. coinbase rising as bitcoin's job help the company turn a profit. roku's result seem to match what wall street was looking for. but oppenheimer's jason helfstein, downgrading that stock. and it is tumbling today as you see there. by 23%. dropbox dropping, maybe its worst day ever, on weak guidance in concerns about slowing growth. that of 22%. we start today with that hot inflation report in the impact on the market, as the markets

try and figure out what the fit will do and when. here's what atlanta fed president rafael bostic told sara eisen early on money movers. >> my outlook is to stop normalization, start returning our product policy stance to a more neutral stance in the summertime. i'll have to say, a year ago, six months ago, i was in the fourth quarter. we've seen tremendous progress. i'm hopeful that that continues. if that continues, i'll be willing to pull it forward even further. but i want to see it continue before making that judgment. >> do you still think three rate cuts this year? >> well, that's what was in the doc. i was one of two recruit increases. i'm still at two. if i pull it forward, if the data comes in more positively, i can move to three for sure. >> all right joining us now to talk markets, the fed, inflation, you johnson, sherman achieve -- with you johnson economics. also with, us ramaswamy's, nbc analyst and commentator.

also chief market strategist at that is the financial partners. ron, i'll start with you. obviously the inflation numbers are hotter than expected. but coming down towards the target, lower than they were -- >> well, i think the markets probably doing this, looking through the producer price report, 2.2% increase in outpatient hospital services, not exactly something the fed controls from inflation perspective. i think some of the data, particularly for january, both for cpi mpp i might be outliers. that seems, certainly the stock market is more calm about it. interest rates are up a little bit. i don't think one month changes the instruction that we're gonna see. >> hewitt, the market seems to, apart from stumbling earlier in the week on that consumer price number, the market seems to be motoring along quite nicely with interest rates right where they are. we heard an impassioned argument an hour or so ago from mark zandi, that the fed needs to move now, sooner rather than later. or it risks damaging the economy, hence the markets.

do you agree with that? when i just leave rates where they are if the desired effects are being felt? in other words, full employment is here. or close. and low inflation is here or very close? why change anything? >> well, mark has a pretty good point. he has a pretty good point, if you take a look at the numbers this week, particularly if you take a look at the retail sales, production numbers this week, and what he is saying, which i think a number of us are seeing is that look, we've kind of rolled out a hard landing. and i think it's a little early to dismiss that. particularly when you look at the numbers this week. the second thing, the soft landing. it's very hard to rule out. i think the consensus right now, you'll find is that the expectation is, we're gonna see some pretty low numbers. first corner, second quarter, third quarter. first and second for sure. for sure in 2024. down from those numbers like 4.9, 3.3% that we saw in the fourth quarter. so mark has a good point.

he saying that the feds, they have to start to move now or that the higher interest rates that we've been, quote living with, for quite some time now, they may have a more serious effect on the economy than we, then most of us have thought. it might be i don't want to say a hard landing, but there is that possibility. >> ron, in the meantime, obviously those harder than expected cpi mpp i prints are out there. but they've gotten some disinflationary indications from the queue for earnings numbers. so if you're an investor, how do you square those two together? i know q4 earnings are kind of backward looking. but as you assess guidance, and various color from the calls and so forth, do you put more stock in that? >> i, mean it's a huge point. we're seeing numbers under softening up, if you look at atlanta fed utp now numbers, we've gone from three 4 to 9 in the latest estimates. we're starting to see things often a little bit. 20 night is dylan good growth rate. clearly. but companies are, in many instances, kind of not having

as much confidence that growth will continue at the same pace that we saw in the last year economy. so i'm still comfortable that this is going to be abnormally normal year, as far as the economy markets go. with, you know, barring any huge external shocks that were not anticipating. it seems to be that we're kind of settling in. i would agree with both mark and hugh, they don't have to go on march. but may would be a good time for them to start thinking about at least piling down, cutest article lowering rates. >> you, how should i think about some of the stocks that we've taken a call in the magnificent 7, maybe now magnificent six. how should i think about them in the role they play in our portfolios? is it time to start taking some profits if they have become too large as an individual holding in your portfolio? >> yeah, i own them. i have to be careful what i say. but the truth is as i wish i had a nickel for every time i was told to cut back on nvidia for example, or apple over the years, not just months.

and we're continuously -- i instinctively, just common sense alone, i look at the performance of say nvidia or apple or any one of the magnificent 7, you ask yourself the question, does this really make a lot of really good common sense? the answer is, i don't know the answer to the question. quite frankly. but one thing you pay attention to in this business, and i've learned for a long time, is you pay attention to relative performance. and with the relative apartments is good, quite frankly, the idea is to say with it. i think it's a really good idea, when you're putting new money to work now, that you are well, you take it easy on the magnificent 7. because they've had such a run. you know, 70% run that we had last year, and start a broader note. i think this market will broaden out. this market is a bull market. and it's all bulmer can go, they generally tend to pull to broaden out. i think this will broaden out. but i don't think i would smell or reduce significantly my so-

called magnificent 7. especially because they are caught up in probably the most dynamic part of this economic growth productivity issue, which is of course artificial intelligence. particularly nvidia, but again, i own some of them, i love them, i'll say with them, but i'm gonna try and broaden out. >> i love them. and we love you, hugh. and we have for 40 years, right? we all go back a long time. >> absolutely. >> sounds like hugh doesn't need any nichols. all those times people told him to sell nvidia. hugh johnson, ron insana, thank you both very much. now let's get to the market reaction to this latest inflation data. we have someone on the floor with the traders in chicago. hey rick. rick santelli. >> hi leslie, let's look back. on tuesday, we had cpi, hotter than expected. it's probably seasonality, probably january. today we have hotter than expected ppi. probably sunspots, right? listen, we can make a lot of

excuses, maybe next month it will moderate. right now they're both hotter than expected. and guess what? two year yields, higher on the week. by a lot. -- under four and a half percent last week. not only that, we've taken out cpi high yield, today with ppe i. they haven't quite done. it you see how high they're going. -- they sold under 20 last week. now maybe the most interesting, look at the s&p 500. on track for another record high close. what is going on? let's talk to jim. hi jim. >> how is it going rick? >> is it easy one today, i want you to explain how we see inflation going up, we see growth going down, we see rates going up, and stocks are partying like it's 1999? >> it makes sense. you and i have talked about the word stack flay shin. no one else was talking about it a little bit ago. guess, what restart is east again stickier inflation. how do you get that to a potential cyclical slowdown? it's structural inflation, we

see populism, more d globalization. costs are increasing. more labor rights, increasing the cost of labor. all these things creatively shun, right? at the same time, you can get a slowdown. we haven't seen that. >> no. you're going from volker to burns on that. so what you're saying, is with that type of outlook on inflation, with regard to the markets and stack flay shin, maybe we'll have more green inequities placed space. >> they have to choose a stackflation. they can fight inflation, like volker, or let's be like burns, issues growth. it's an election year. they're choosing growth. what does that mean? liquidity to the markets. this shouldn't surprise you that you're seeing all-time highs again. no. you're gonna see that liquidity pumping into the system until they choose to by inflation. you're gonna see a steepening of the curve, higher yields to the back of the curve as they continue to stimulate. >> even though we don't necessarily see the steepening yet, i couldn't agree with you more. right now it is all about short

maturities, trying to define what this is going to do to the fed. and here is this bias that they are going to eat. your final thought, do you think the fed is going to ease more than five times this year? >> no, not more than five. but they're gonna tried every turn. they try to say the word transitory again and again. they keep getting called on it. they want to stimulate. they want to choose growth. but they're kind of stuck in a box. i think that puts them at a lower number. >> i'm sure it's an election year, it has nothing to do with it. cem, thank you for joining me today. leslie picker back to you. >> thank you so much, rick santelli. have a great long weekend as well. speaking of rising prices, tyler, how about we talk about computation numbers that we are getting. goldman sachs revealing's 2023 compensation details for ceo david solomon today. the board approved $31 million for solomon, up 24% from last year. although, it is before his comp from 2021. the package comprises $2 million in base already in 29 million verse worth of

discretionary bonus. -- performance based talking in. it's the rest is cash. the 24% jump is the largest change among the big banks ceos, who's 2023 compensation has been disclosed so far. but the total package amount is the second smallest. that filing today, it's a supports composition committee made its determination based on solomon's quote, decisive leadership and reorganizing the need to clarify and simplify the forward strategy. and, quote progress on strategic priorities in the firms core franchises, which include global banking and markets, and asset and wealth management. the firms pivot, narrowing its consumer ambitions and selling off some of it's unbalanced investments, came at a cost in 2023 though. goldman sold off various asset, and marked others lower. goldman shares gained about 12% in 2023. the company's net revenue declined 2% as the capital markets and deal making remained dormant. return on tangible equity was

8.1% for 23, down from 11% the year prior. and the company recorded about 2.8 million dollar impact earnings in the year from a slew of special items. tyler. >> they've been really captive to what's been going on in the deal making. >> yes, absolutely. that's why you saw revenue take down 2%. because deals are just getting done in the same way they were saying, in 2021. >> what are they doing to that consumer space, with the apple credit card, the banking business. utah, i can't remember? >> that is the business that they're narrowing. they basically moved that apple card business, kind of outside of their ambitions. the gm cards, same thing. that is just not a key strategic focus for them anymore. >> and that was a -- initiative, wasn't, or am i wrong? is that fair? >> it was kind of a holdover, but solomon really took it to the next level when you took that seat. obviously, since then, he's

pulled that back a bit. that's kind of been the big transition, big pivot that we saw in 23. it led to a bunch of charges, things put in available sales. >> you said, of the ceo whose pay we've heard about, while the pay package was, i think you said higher than last year, lower than two years ago. but is the second smallest among the major banks? >> $31 million. >> who's got the biggest? >> the biggest, i believe is james corman, stanley. >> outgoing. >> yes, outgoing. although from a percentage increase, i believe, if we can get that full screen up there, i believe, if my numbers, if my memory serves, it's about a 70% increase from the year prior. >> did me to catch you off- guard there. >> no, that is okay, that is okay. >> coming, up the ever-changing retail landscape, the industry is seeing an unprecedented upheaval of the past few years. so what will the next look like? we'll talk about retail, next. plus, the cost of owning a car

is getting a little bit painful. higher insurance rates and pricing your vehicles have left americans fumbling, stumbling forward. we will discuss what these car costs are due to americans budgets, when power lunch returns. right here. fresh, warm hot dogs! when i'm not selling hot dogs, i invest in a fund that advances innovations like robotics. fresh, warm hot dogs, straight out of my torso!

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♪ ♪ ♪ ♪ >> welcome back. the retail sector has been unprecedented upheaval over the last several years with even more changes likely coming in the coming year. cnbc spoke with industry executives on the state of retail and what they predict the retail landscape will be like. five years from now. current and former ceos weighed in on a number of topics and challenges currently facing the industry. joining us on site are the authors of that article, cnbc's own melissa rocco and gabrielle from -- thank you so much for being here. melissa, let's start with you. because it feels like in this

kind of post pandemic era, we look back, and there were so much change that took place from supply chain, to technology adoption, to just the way that consumers are purchasing things. you know, adopting more e- commerce habits, online shopping habits for example when you're stuck at home. how did that time period really reshape retail? and how are ceos looking at that as maybe accelerating some trends that could've happened five years from now? or three years from now? >> one of the resounding takeaways, leslie, when we spoke to ceos as we talked about the importance of the store. i think during the pandemic, a lot of us thought they would fade from relevance but now those stores are playing a critical part of the business by serving as fulfillment centers. they're not just helping a company show off their product, their helping pack and pick and deliver orders and get closer to that customer breakdown cost. people of a brace online shopping. the two have to be combining, and working together. >> so obviously, the store,

very important. and shockingly, ubiquitous. especially since i think if we were having this discussion, maybe ten years ago, looking ahead to what five years would be. everyone would say, oh, complete, amazon is taking over the world. e-commerce is the way of the future. but i think we learned that people do enjoy that in store experience. and gaby, one thing that really struck me from your piece is just what the ceos are expecting in terms of technology, and how it's not necessarily a replacement for brick and mortar but something that is additive to that experience. >> you're absolutely right. this idea that retail instead is completely false i mean we even spoke with ceos of digitally native companies talking about the importance of stores, as it is for customer acquisition. there's so much technology can have in the store now. something that this epo of newman markus mentioned to me is that when it comes to luxury it's an opportunity to bring in a full sensory experience, with the smell in sound and visuals. having that opportunity to have

a three 60 experience with the product. even something as simple as fitting room technology. how that can incorporate between online shopping in store shopping. getting that fit correctly, with a mirror that knows you better than you do. and what they said is that is going to lower returns, increased customer satisfaction, so much fun things to come. [laughter] >> it sounds a bit like, okay, not sure. >> one of the people you spoke to said that the search engine is going to be like the cassette tape. what was that -- ? >> that was mark lori. formerly of walmart. he ran walmart e-commerce business after walmart made a very big acquisition. he was, his point there was that with artificial intelligence, the intent of a customer is going to be much more understood. you're not gonna be going to amazon.com, or walmart.com and typing in red sweater. there's going to be a better understanding of what you want based on your shopping history and your engagement, through maybe a chatbot, how you use

the mobile app of a company. it's going to know you much better. and there's not going to be this kind of like, he was kind of describing, search engines are gonna look really dumb. they won't know what you want. they won't know you at all. instead, we're moving to a world where retailers, if they do it right, will serve almost as a digital assistant. they will be providing that, almost like a best friend who knows exactly the kind of sweater you might want, that you're living in a climate that you might not need a sweater, you may need a short sleeve shirt for valentine's day for example. kind of getting to know you better and being more sophisticated and customizing that experience. >> almost a little creepy to, like the mirror. >> absolutely. >> gaby, how are you seeing, based on the prognostications of what these executive c for the next five years, how are you seeing investments today taking place at these retailers -- do you think that they are making the appropriate investments to be ready for five years from now? or do you think there's some significant gaps out there? >> it's a great question. because covid really

accelerated this timeline. you touched on at the beginning of this conversation, these are changes that were coming, but that covid made so much faster. there is a lot of reactiveness over the last three years, now is returning into 2024, retailers are in a position where they're trying to be a bit more proactive in getting to the right place. investing in the right technologies. everyone always says though that the retail industry is so far behind when it comes to technology. so there's absolutely a lot of gaps, but we are seeing a lot of retailers lean into a.i.. they are doing some things with it now. nothing super cool and exciting. i've yet to be wowed. but in the next five years from now, if they really focus on the operations, focus on investments, get the right vendors in their pockets, we could see some stool cool stuff. >> gabrielle fonrouge, melissa repko, then you very much. as we head to break, a quick power check on the positive side of applied materials. fresh 52-week highs. thanks to a q one earnings. shares of a percent. negative side, digital realty trust. we have the ceo on earlier,

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>> welcome back. in the fall, regulators finalize new rules surrounding a community of reinvestment act. that was first passed in 1977 to reverse policies that had been depriving lower income and interest in our neighborhoods of credit. originally the rules were tied to a physical bank branch, encouraging banks in those areas to lend in communities where they were also taking deposits. but in this new iteration, updated for the modern age, it takes into account declining branches in lieu of digital banking and evaluates banks for lending they do on a nationwide basis. last week, a slew of trade associations, including the american bankers association and u.s. chamber of commerce filed a complaint in the northern district of texas against the fed, the fdic and the oh cc. the plaintiffs say the new rules went too far, and they are seeking to vacate them. the fed, the fdic and oh cc declined to comment on the lawsuit. but others say the modernization is necessary to bring access to credit to

underserved communities. bill bynum leads a credit union an advocacy group down in the south. he said discriminating lending practices are quote, still unfortunately rampant and strong modern rules that account for the ubiquity of mobile banking are needed to close that gap. he said that he found a lawsuit quote, hard to reconcile. >> cra is designed to make sure that banks reinvest in communities where they extract profit. historically, based on where you had a branch. wolf branches are not, no longer the primary way people access the financial system, then you have to modernize. and i think regulators have done a reasonable job of doing that. >> the banking groups say to comply with the final rules in the first 12 months, that cost could exceed $600 million. tyler. >> interesting how the change in the way that we bank is changing this kind of regulation. >> yes. >> branches are closing.

everywhere. >> yes, they are. and in closing a kind of created this gap in the system. the cra, when it was first passed in the 70s, it was directly tied to, and the way the regulators kind of monitor things, based on physical bank branches. if those branches disappear, the regulatory oversight, ensuring there still access to credit in those areas, also disappears. so the intent of these new modernizations, these rules, which by the way were updated for the first time, in earnest, in 25 years, was to kind of fill in that gap in close that gap. but the banks are saying, you know, this is putting way too much pressure on us. because now we have to comply with what is a 650 page amendment to this act. so very long, complicated rules. and we are held responsible for the lending we do on a nationwide basis, as opposed to historically, based on where you had bank branches. >> a lot of do this nationwide. a lot. don't but some do.

>> or they don't do it nationwide, but they do it over a large swath. >> southeast, midwest. >> exactly. >> already, let's go over to kate rogers shall, we for cnbc news update. kate. >> hi there tyler. president biden is traveling to east palestine ohio this afternoon, as he faces criticism for not going there sooner. it has been just over a year since he train derailed in the small village and built toxicological's. the white house plans to build a visit to -- federal railway safety legislation that stalled in congress following that derailment. prosecutors dropped a domestic violence charge against boston bruins star this afternoon. they said the decision by his wife to invoke spousal privilege and refused to testify made it possible for them to prove their case beyond a reasonable doubt. it also came after a judge also ruled her 9-1-1 call following the alleged assault was inadmissible in court. a stolen base qatar that belonged to paul mccartney has been found following a five

decade search. a campaign called the lost base project tracked the iconic guitar, which someone stole from a van in 1972, to a family in southern hastings, england. mccarthy used the guitar and countless live shows, and the beatles first two albums. what a story, tyler. back to you guys. >> i was going to say, rather antique. >> truly. >> thank you kate, we appreciate it. >> thank you. >> beautiful guitar indeed. still ahead, atalanta and quincy is getting their highest level in 13 years. but one expert says americans can get back on track when it comes to owning a car. she will share her tips, next. to advance the future of golf, pga of america chose t-mobile for business. with a 5g powered innovation hub to analyze player performance and expand coaching tools. take your business further with america's largest 5g network.

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>> all, right welcome back to power lunch everybody. high interest rates, not making it challenging for perspective home buyers only, car myers are expecting experiencing sticker shock, and squeezing budgets for them as well. the average new car prices up 30% since 2019, to just over $48,000. car interest rates nationally rose 20% at the end of last year, from the prior year. and the average new car loan is up 50% from 2021.

here to discuss the cost of owning a car, and what fits americans budget, jade warshaw. a tiktok influencer, and co- host of the ramsey show. jade, nice to have you back, welcome. >> thank you for having me. >> everybody knows cars are more expensive. interest rates are higher. i think many people know that insurance is up. so how are they able to buy so many cars? [laughter] >> you're exactly right. we've seen karen sheeran's go up 20 to 28% and americans are feeling it. the average american pay somewhere around $212 a month just for the car insurance. that bump in insurance, they'll be paying an extra 42 to $45. that alone with a covered average car payment of $700, no wonder americans are feeling that squeeze. and if they want to stop feeling that squeeze, they're gonna have to make some changes. that starts with their budget. >> what do they have to do? >> you know, i always recommend people by cars in cash. the moment i say that, people

go, what are you saying, jade? i'm just gonna walk on by a 35,000 dollar car in cash? not at all. most just get fed up with our car payment. we saw the car. if we're not able to pay it off in two years or less, i recommend selling that car and really buying a car in cash, somewhere around eight or $10,000. you can always upgrade as time goes on. >> i think you are right about that, by the way. i've always said, i've always been told that the economical way to buy a car is to buy with cash. because, financing costs are built into a lease, if you take a loan, you have financing costs there. so it is. but then that means that i'm not getting the hot, sweet ride that i want. [laughter] >> that's right, but you know my dot my buddy, dr. john, he says, we have to choose reality. we have to live in reality of what our finances will allow. i always tell people, you have to look at the opportunity cost. when you have a 700 dollar a month car payment, you can either use that on a sweet

ride, as you so eloquently said, or you can invest that money, and over the next 25 to 30 years, have yourself one, one point $1 million. the choices up to the consumer. >> our gas prices giving consumers any relief? especially after what we saw a year or two ago? >> i, they're probably feeling some relief there. but i feel like it's just been counteracted by this insurance going up. and so at the end of the day, we have to be on top of our personal budgets. every month we're making a completely new budget. every month our money is different. and what is required of our money changes. i was recommend a good, detailed, really flexible budget. that is going to solve that problem for americans. >> so, i guess there is no way i can, well, are there ways that i can reduce my insurance costs? >> absolutely. obviously, the model a vehicle that you drive, it does matter. if you drive a tesla, there's more technology in that vehicle. it's gonna cost more to replace, it or repair it if

something may happen. i always like to tell people, think about where you live. if you live in an area where there's a lot of natural disasters, hail storms, tornadoes, fires, your insurance can go up. obviously if you live in a place where there's a lot of uninsured motorists on the road, or an area where auto theft is high, unfortunately, all those things do drive up the cost of your insurance. and i'm not suggesting that we all up and move our homes, but we can do something as simple as deciding that we're gonna drive a less expensive vehicle and decide we pay for it in cash. >> jade, thank you very much, good advice, jade warshaw. >> coming, up openai's mind- blowing tool. the brand behind chatgpt just one failed some examples of its new text to video video tech. and it is leaving the internet, and myself, bewildered. our julia worsen will stare the details, next.

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>> open a.i., the company behind chatgpt, expanding into our video generation and its text to video tool is creating some jaw-dropping videos. let's head out to julia boorstin, for today's tech jet. hi julia. >> hi tyler. openai's new tool called soar a's attacks to video generative a.i. tool which can turn descriptive sentences in to a video clip as long as a minute. it can also turn still images into video and can extend videos and use missing frames. take this example, the tax prompt is, s reflections in the middle of a train traveling through the tokyo suburbs. take a look at the reflection, everything looks pretty real to me. now openai's expansion biontech and injury, images raises concerns for realistic fake videos to manipulate consumers. especially ahead of the election. open a.i. saying they will be engaging policy makers, educators an artist around the world understand their concerns and

to identify positive use cases for this new technology. just earlier today, 20 tech companies announced a commitment to combatting misinformation in this year's election around the world with a.i.. openai also say it is working to make sure that a.i. generated content can be identified. they are building a detection classifier to identify sora generated caps. and also using metadata for videos. there's another potential issue here, concerns that a.i. generated video could infringe on copyrighted work. openai says it is only training on licensed or publicly available content. while this new technology may not be threatening the livelihood of filmmakers just yet, deciders the nanometers may be concerned. it looks pretty good to me you guys. >> let me ask a couple questions here. are those videos that we just saw, where they all digital, digital videos? or was it real video?

>> it is generative a.i. videos. those are not videos that are taken by a person with a camera, or what they found. this is generated based on a prompt. so it is trained on, you know, obviously another images. but this, the video that we showed earlier today of a bunch of golden retriever puppies, i mean it looks so real to me. i could swear it was actually a video. but it was just generated based on this. >> it's incredibly real. >> incredibly real. if you're looking at this here, you can see people's faces. you're seeing them from behind. maybe not everything about this path makes sense. how are they gonna get out of that path there? but it does feel very realistic. >> that probably was generated based on a prompt from someone who said, show me a video of a walking path in this district in tokyo after a snowstorm. >> the combination of cherry blossoms and snowflakes. it's going to capture what the prompt says, but not necessarily going to be a real

street. this is about generating something new. but remarkably lifelike, if you ask me. >> you've done one of these, haven't you? where there is an impostor of you and your voice and everything. i remember this. >> we've been lucky to get to experiment with a lot of this cutting edge generative a.i. technology. last, year we played around with the fake technology that allows someone else to wear my face. skin my face and effectively put it on someone else. also sort of use those generative a.i. technology to turn me walking through a movie set into a robot or alien. just amazing how fast the technology is evolving. >> there's a golden retrievers, these are digital golden retrievers, not real. >> not a video. digitally generated using generative a.i.. so cute. >> there is only one julia boorstin and you are the real thing. >> for now, at least. >> thanks, julia. as he was big tex year of efficiency, big oil has been doing the same thing and it

doesn't seem to be hurting productivity. pippa stevens is a look behind the numbers. >> the u.s. is producing a record -- with barrels of oil. that's more than any country in history has ever produced. you can see behind, me that is the blue line. that of the shale revolution, the advent of hydraulic fracturing, a production is now at a record 13.3 million barrels. at the same time, the rig, count the orange line, has actually come down. and important details that the recount is a leading indicator of sorts since it is a very first step in the drilling process. that's before the well has been completed or actually producing oil. but it speaks to the fact that energy companies have become much more efficient. meaning they are getting more oil out of the ground for every dollar spent. what are some of these efficiencies? if we advance to the next graphic, as alexander ramos p on from -- energy told, me first and foremost is longer, lateral wells. you drill down vertically and go 90 degrees and drill horizontally.

back in 2014 the average while length about a mile along on the horizontal sense. that has now since risen to almost two miles. some of the largest companies are actually drilling up to four miles horizontal. that of course means that your well is yielding a lot more of the oil and gas. other things include larger well pads, think about all the infrastructure required to drill a. well all the electricity and all the piping. if you can drill more wells per each path. once, again efficiency goes up. same with ymbol for acts, two wells at the same time. the personnel onsite, time goes down, greater efficiency for you. and subsurface understanding. these companies collect a lot of data and are always crunching it. out of the pandemic, the motto of oil and gas companies has been capital discipline and shareholder returns. on the next graphic, this really demonstrates that because this is the average live drills with uncompleted wells. you can see back in the, day companies were drilling all over the place and maybe

weren't even going to complete those wells. they're doing left, right and center. now they are being much more intentional. you see the number of live drills but not yet completed wells has actually gone down. all of this together means that this is now a well oiled machine, companies are being very strategic in terms of where they are drilling and really focusing on the best acreage in order to keep their costs down but their production maintained and maybe even growing a little bit. >> it's literally the epitome of a well oiled machine. pippa, thank you, now we know that exists. still ahead, the strategy for semis. or three-stock lunch trader will tell us which names she is feeling chipper about. next. and during february, were celebrating black heritage here. here is key iaea's chief institutional client officer, kourtney gibson, sharing her story. >> 54% of black americans do not have enough savings to maintain their current standard

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welcome back, everybody. time for today's three-stock lunch where we look at three big movers. today, we focus on the chips. here with our trades, gina sanchez, lido advisers chief strategist and also a cnbc contributor. up, first let's go, gina, two applied materials. the company delivering an earnings feet yesterday. positive outlook, shares of empty up 8% today. your trade on that one, applied material? >> this is a bye for us. applied materials is doing extraordinarily well. if you look at their market share in the revenue guidance, it suggests that this is a stock that can continue to

deliver. and the big macro story here is true for all of the stocks were going to talk about today. the demand to continue to process faster and more complex algorithms is only going to go up. a.i. is feeling that. but we think that this demand is a secular move, not a cyclical move. >> feels like that years of the chips. of, next super micro computer, wild story here. investors have been betting big on a i demand. shares up over, i don't think this is a typo, 800% in one year. but down about 11% today after an analyst call said the a.i. boom is priced in. gina, do you agree? do you think the a.i. boom is priced and after an 800% increase? >> no, this has been a stock that has been a summary and flat for a really long time. these guys make servers, unlike amt, who's making ship design software and manufacturing stuff. these are the actual servers

and they just have really met their moment. you are seeing that their high performance servers are the kinds of servers you need. their customers are people like data centers, folks running data centers. cloud computing, a.i., everything to do with this current moment is actually custom built for the server. before now, nobody needed that kind of high power. this was a very undervalued stock that is now reaching its moment. >> finally, let's go to your favorite name in the chip space. we ask you what it was and you said advanced micro devices, a m d e, another stop that has ridden the a.i. wave in the last year. you love amd. >> we do love empty, and to be fair, we've owned it for sometime. it's been the gift that keeps on giving but it is yet to really achieve nvidia status. the latest unveiling of their

new processors, the rise in 8000 series for desktop computing, we know that's going to really start to get into that space. and we should start to see -- actually, we shouldn't start to, see we will continue to see really strong revenue off of that. we think the demand for this, like i said, this is a secular planted a cyclical one. we think the demand is going to remain for sometime. >> gina sanchez, thank you. >> coming, up a record-breaking night. i will women's basketball star caitlin clark just broke the ncaa's all-time scoring record. we will have that when power lunch returns. almost from the logo, the re pointer, amazing. one of the millions suffering from pain caused by migraine, nurtec odt may help. it's the only medication that can treat a migraine when it strikes and prevent migraine attacks. treat and prevent, all in one. don't take if allergic to nurtec.

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i love the reaction. they're only about two minutes left in the show, that's all it took for caitlin clark to make history, scoring eight quick points last night to set the division one women scoring record. she finished the night with 49, points a career-high. hysteria had been surrounding clark, creating unprecedented attention and money for women's basketball. many people take hundreds or even thousands of dollars to watch her play in person and many more watching her break that record on peacock. i love the crowd reaction. everybody knew what was going on. >> she is a phenomenon. amazing form on her jump shot, with the last wrist there. that was almost from midcourt. the ecord breaker. >> i talk to investors all the time who say with the sport is a next frontier of entertainment. peeing are paying money to see women sports. >> it's compelling, you see some of those big ten women's

volleyball games, they're fun. a lot of action. >> so fun. >> one to congratulate our line producer joe t of the birth of his son. we're thrilled to add this adorable little fella to our power lunch family. there he, is congratulations to joe. it's all good, we are happy. thanks for watching power lunch. good to be with, you leslie. thanks for coming. closing bell right now. welcome to closing bell, i'm mike santoli in first got wapner. this make or break hour begins with a pretty unflappable our. coming off the sell-off but wavering in the last hour. it does s&p 500 finn reach of another record high. any positive close on it would be a new record. and weekly gain out of the past 16. this despite higher than expected ppe and placing this morning. upside surprise to cpi on tuesday, soft retail sales report for january along the way. as well as some uncharacteristic weakness in the magnificent