iii capital requirements, and i support the overall effort on basel. we did raise concerns with respect to a specific issue, which is the harmful and, we think, unnecessarily harmful impact it could have on clean energy tax credit investments and all of the regulators testifying that day including the vice chairman said they recognize this was a significant issue and hope to address it. would you agree with that? >> yes, i would. >> thank you. thank you, mr. chairman, thank you, senator fetterman. >> senator fetterman of pennsylvania is recognized. >> yes, i love that. all right. so it's great to be here with you today. now i don't know, maybe some people in america were talking about a cookie that was $18. and i was alarmed, and i hope we investigate that there is a cookie that costs $18, and do

you believe that an anecdote on twitter about a cookie that cost $18, is that reflective of our economy and where we're at or not? >> i certainly hope not. i don't do much shopping these days, but that sounds like a pretty expensive cookie. >> yeah. and, now, i believe that the american economy now is the envy of the world after everything right now, correct? >> we are -- yes, we're performing very well compared to our peer group. >> pretty great. and is it fair to say that the stock markets are all up at record highs, right? >> pretty close. >> yeah. and inflation has been pretty effectively addressed, right? >> sharply since the middle of last year. we have a ways to go on that, but we've made a lot of progress. >> and corporate profits are pretty robust, is that fair? >> i believe it is.

>> okay. well, we can agree that -- and i don't understand why more people seem to be talking about a cookie that costs $18 but it seems to be against the evidence as well, but given that -- now, since things are pretty great and we're in a really great -- excuse me one second -- place, but now i am concerned, and there's rumors going around that basel, they're going to change and they're going to reduce the capital. and i guess i'm concerned about that because i don't know why we would want to -- and also i want the record to reflect on -- you're much smarter than i am -- i would be concerned things are in a really great place right now, we can all agree on that. i would be concerned to change something like that because i wouldn't want to have something, again, like what happened with svb. and i just wanted to get your

take on that. >> sure. u.s. banks are well capitalized, and generally speaking they're quite well capitalized, and we're not talking about reducing current capital levels at all, really, in the basel iii end game, capital may well go up and what we're talking about is whether the proposal that was put out by the bank regulatory agencies, including the fed, which has been the subject of quite a lot of comment, whether -- what changes will be appropriate to that. that's what we're talking about, not reducing existing capital requirements. >> okay. and then i also want to play off of a comment made by my colleague from tennessee, and i actually agreed with him, and he's concerned about the deficit about it's a trillion dollars for every hundred dollar days. if the federal government added 3.5 trillion to the deficit by extending the trump tax cuts, would that increase or decrease

inflation? >> so i'm going to fall back on our long time reluctance to comment on fiscal policy. we take fiscal policies as they are and we conduct monetary policy to achieve 2% inflation, but we don't score inflation. cbo does that. they'll make a judgment on that, but it's not something we do because we're an independent agency and that requires us to stay the heck out of politics. >> so i don't want to put you on the spot, but would those kind of tax cuts help addressing inflation or inflame inflation? >> i don't know what the effects would be on inflation. i do know broadly speaking we need to get to a place where revenues and spending are better aligned, and i think everybody knows that. i think we used to talk about this a lot ten years ago. we're not talking about it so much anymore. that's understandable. the pandemic was a special

thing. i do think it would be great to get back to that on a bipartisan basis. >> okay. well, i have about 30 seconds left. i want to go on the record, i think you've done a really great job, and i think our economy -- and i do agree that it is the envy of the world as well. and i'm confused that more people are talking about cookies or mcdonald's meals and those kinds of a thing. it's not reflective on the strength as well, too. and i just want to thank you for your service. >> thank you, sir. >> that's the last questioner. thanks for your generosity in yielding to colleagues who got here -- from whom you got here before, if i said that right. thank you to chair powell for joining us today, every six months and sometimes more often i look forward to working with you. senators who wish to submit questions for the hearing record are due one week from today, march 14th to chair powell. please submit response no more

than 45 days from the day you receive them. thank you again for your testimony. >> thank you, mr. chairman. all right, the gavel has come down ending fed chair jay powell's testimony on day two, this time before the senate. really underscoring what he has said over the past couple of days, that rate cuts are coming late they are year if the economy and the fed chair's words does, as expected, the stock market obviously liking that once again because we do have a rally on wall street. bond yields are falling. the ten year hitting a one-month low at 4.11%. we have a lot to get to. i have the investmentcommittee here. we'll get to a lot of stuff. i want to bring in senior economics reporter steve liesman. steve, that is the headline of what the chair said today. rates are coming if the economy does as expected and what he started to say yesterday. >> reporter: yeah. i think it's very much a repeat, scott, of that. the economy is in a good place, talking about the u.s. being the best of the advanced economies, waiting to be more confident to

cut rates. a lot of talk about fiscal policy for the housing market and a deep dive coming on the balance sheet. scott, i think the story here is not just powell. it's the symmetry of powell and lagarde. i think that's the bigger story here. both of them talking about the idea that they see inflation moving in the right direction. the ecb staff bringing down their forecast for inflation this year. lagarde saying pretty definitively we'll have information in april, but we'll have a lot of information in june. and that's kind of a wink and a nod for june coming. powell didn't do anything to dissuade where the market is in terms of a 75%, 73% probability of a june rate cut. so i think what the market is looking at here is be chill in spring and things will get, i guess, a little hotter come the summer, and i think that will happen on both sides of the atlantic. >> and i think that's, as we said, why stocks are rallying today. steve, thank you very much. so maybe central banks making it clear that they're going to move

in concert in some degree when they do begin this new regime of cutting rates after they've raised them quite substantially and rather briskly over the last 18 months or so. i mentioned the investment committee is with me. josh brown, jim lebenthal, liz, i'll go to you first for the big picture view here. the chair didn't tell us anything we didn't know. he underscored why perhaps the stock market has moved like it has from the late october bottom, and we find ourselves with another rally on our hands as a result. >> right. and yields have moved down a little bit this week. i think that's part of the rally. we're still in a period where there seems to be a good amount of risk appetite in the market. so even after a couple days where people get a little trepidatious, we have a pullback. dip buyers are in, they want the stuff that will generate growth, and i think that's the piece investors are keying off of right now. still thirsty for growth. still looking for growth even in

other parts of tech now outside of things like nvidia, outside of the highly valued stuff. so we're probably going to continue along. this is my take. we'll probably continue along at an okay speed until we get much closer to rate cuts, which is why we should not have wished for rate cuts starting in march as it were because that's usually when the market starts to get worried. >> dip buyers are in, in your words, and josh brown, momentum players aren't leaving. case in point nvidia. topping $900 today, a new all-time high, the first time that stock has been over $900 a share. $917 is where it is now. that's a 3% gainer. any drop in this stock is quickly scooped up, and that's the lesson of what we're learning around nvidia. >> yeah, i think if you're long the name. the only thing to really do, what i've been trying to do is make sure the position doesn't get too big, that it swamps and a get out of the way situation. i don't know why you would want

to fight with this thing. people have this thing where whatever is going on and making people money, something must be wrong and there are, it has to be red. i've never seen anyone do it successfully. understand what's going on is once-in-a-lifetime, appreciate it and manage the position. so far so good, no complaints. >> trying to take it from $1,000 to $850. when you eclipse one target you bump yours up. brian belski, you're trimming this, almost sounds gratuitous, to be honest with you. you suggest it's tiny, tiny, the trim, that is, and you're not trying to be too cute. >> brian, why do you hate nvidia? >> brian, why are you bearish?

>> we're humbled by that. we've owned nvidia for several years. and josh nailed it. when you're looking at running portfolios, as we do and we have concentrated positions and in our largeliosportfolios, are we being cute? i never have a problem with being accused of being cute. let's take 15 basis points off and if and when we think the market is frothy here, when the market comes back in, we'll add again. >> do you think the market is too frothy? >> we do. we have a real issue with everyone chasing the market, the herd mentality. what's interesting for us, the majority of competitors are saying what we said a year and a half ago. the issue is playing the momentum game, trying to play the upside. now, just to be clear, we

continue to believe that u.s. stocks are in a 25-year secular bull market. you have cyclical bears and cyclical bulls. the cyclical bulls started in october of 2022. remember, we came out with our 2024 forecast in november and said our bull case is 5,500. i think we can get to our bull case at some point, but let's take a breather here. we have too many bulls right now. >> are we really that frothy in an environment where it's -- to underscore today, rates are going to come down, they will come down further. earnings at least as it relates to some of the largest multiple stocks in the market are showing up, so maybe we're not that frothy as it would seem in an environment that is fast changing from a rate standpoint -- >> yep.

>> -- and in earnings. >> our forecast is the first half of the year we were going to see rates around 4%. are we frothy in a near term basis? in terms of second years of bull markets, we're about 700 basis points ahead of the average bull market in four months into the second year over the last 13 bull markets, so with everybody agreeing that we're in a bull market and everybody trying to play this momentum game, when everybody agrees that things are positive, i want to go the other way. just like when everyone is super negative, i want to be contrarian. >> a lot are afraid to change their view now because they've been negative for so long. >> i think that's true on the true bears that are always bearish, right, but you've seen these fringe people talk about being bullish even though their kind of speak is quite bearish. we are still very bullish longer term. we're long-term investors in stocks. we think we can get stocks cheaper over the next few months. >> jimmy, ubs says price momentum as a style is, in their words, abnormally overbought. they point to semis being at the

top of that list, plays off nvidia. i can go off the list of names that have just ripped and roared. you trimmed nvidia, too. now if we're having some sort of melt up, what are we supposed to do with it? >> ride it. the trim of nvidia was actually a mistake. i don't think we need to spend much breath on that. i'm with brian on this. it is frothy. i think we're in a melt-up. there's no definition of that, but what i'm going to do, i'm going to ride it until i get a distributive day, and when that happens, i'm going to trim. i'm going to trim in the semiconductor space, which is the he center, in my opinion, of this meltup. i will not try to anticipate it. that was a mistake with obviously. it could turn tomorrow. it could go another 10% higher. my feeling on this is on a distributive day if i trim qualcomm on a down 4% day, you can look at the charts of either of those companies because

that's not just nvidia melting up, one year or year to date, they are turning exponential. if i give up four percentage points on stocks up 60%, believe me, i can live with that. for right now, ride it. it can go on far longer. >> i agree. it's a sector wide meltup. >> you've been nervous about the nasdaq, more than most. >> mainly mega cap tech. >> which, as liz said, the buyers continue to come in. you see meta today is up 4%. >> meta and microsoft look the best right now. >> i know the underperformers like the teslas of the world and the alphabets and the apples, but at some level, and maybe we're at it now or we hit it after the sell-off earlier this week, the dip buyers say enough is enough, these are the stocks you want to be in because of exponential growth in their earnings power relative to ai. >> to be clear, you didn't really get a dip in meta or microsoft. apple 17% below its 50 day. that's a dip.

the rest not quite a dip. but semis are just across the board. i was looking at some tickers, tsm up 5%, avgo up 3. if you look at a ten-year a annualized basis, annualized returns for one industry group within tech, that's more than double the s&p 500 which, by the way, hasn't had a bad decade. the s&p is 13% annualized over ten years. so this is a group of winning stocks that continues to work its way higher. the fundamentals are not changing day-to-day to the degree these stock prices and market caps are changing. >> that's what wolf says today. just crushed it. that's what wolf said. >> that's all i do is crush. >> momentum will outperform until the fundamentals disappoint. >> absolutely. >> and we're not seeing anything close to fundamentals really disappointing. you can pick and say, okay, maybe the mag seven is now the mag five for the time being, maybe the fundamentals have

disappointed from tesla's standpoint and questions about the fundamentals related to apple in china and weakness around the iphone and market share there. you haven't had enough of a fundamental disconnect to upset the trade at-large. >> and i don't know that we're going to get one from a stock-by-stock basis that's big enough to accepted the market the other direction. if there will be bad fundamental news it's more bad economic news and the fed reacts and people get scared because of that. you have to also notice that i remember when we talked about can the market go up without apple? the answer to that now is yes. and we've just shifted our view to now can the market go up without nvidia? and we don't know the answer to that yet, but i think you have to recognize the momentum strength that is behind that, and that doesn't mean that it's correct, that it's not all going to come crashing down, right? big tree, fall hard. >> times are different -- >> i struggle with that so much. >> dare i say there was a period of time maybe we couldn't have withstood a significant decline

in apple or in alphabet, but now that slack, if will, is being picked up by so many other areas of the market. >> the market gets redistributed. >> we just changed it. we moved it off apple and put it on nvidia. >> well, it's not like nvidia is the only mega cap stock doing well. meta hits a new high today. my point is if you've got financials, industrials, materials, all these suddenly doing well, a drop in apple doesn't stick out like a sore thumb. >> fair. >> it's absorbed by these other areas. that's what we're witnessing now. >> so back up and figure out why some of the other sectors are doing well. you've got, by the end of february, more than hatch of strategist price targets were blown out for all of 2024 and then people started to chase, to brian's point, starting to raise their targets. people are recognizing -- i mean, people are reasonably rational but they don't want to take their money out of equities, so they just start

rotating oumtt of the stuff they've been holding and into things adjacent, so other parts of tech or maybe the cyclicals because the economy didn't fall apart. but the fundamentals economically didn't get materially better. they just didn't get worse. so we're substaining through this where we're still growing, we're okay. inflation is not that big of a concern. the labor market hasn't cracked. suddenly, okay, we can buy cyclicals now you see this big run-up in industrials and now investors are still looking for other places where it makes more sense to pay that multiple because they're still searching for upside. >> i want to hit financials, too, brian, because i feel like the financials has been a favored place for you. i think the most substantial thing that came out of the two days of powell since we really didn't -- we didn't get much, if anything, new on the monetary policy front, was he all but slammed the door shut on these new basel iii regulations that have been railed on by bank ceos

and long discussed. powell made it clear that there are going to be major changes to what is being proposed, and that is going to be good for the banks. there's no real way -- other way to look at that. the xlf, 52-week high, now wells has hit a 52-week high. jpmorgan, you're trimming that one? >> we trimmed jpmorgan because we prefer citigroup as we've been adding the last five months, a contrarian play. we love to buy banks when they're restructuring and cutting costs. we've been long-term bulls in terms of the big banks, the asset managers and the brokerage firms because of the scalable size of this. now, with respect to the regulations falling off, now you have the opportunity for some regional banks to add scale. how do they add scale? through m&a. i think you'll see consolidation be a major theme, maybe as early as the second half of this year but certainly into '25 and '26 and that will be really, really good for the financial services area overall which, oh, by the

way, still remains relatively underweight by the majority of our institutional investors. >> jpmorgan is a place, as josh knows, that has had tremendous momentum behind it. there's nothing to suggest, at least on the surface, that that paradigm is about to change anytime soon, correct? >> yeah, i don't think so. it's a very -- it's a standalone issue even within financial services. there is no other institution that has all of the elements that jpmorgan has. they're number one or two in every business they're in, more profitable than most of their peers. they don't make stupid decisions when the market gets shaky and when the market normalizes they outearn everyone else. it's one of these things you actually don't get penalized for paying a slightly above industry multiple for the stock. it's a higher price book proven year after year why it's a higher price book and it has never worked against you. look at the performance of jpm versus the money center banks

versus stocks like citi consistently. it works, it works, it works. >> former -- former basket case stocks like citi -- no, former basket case. >> call me when commercial real estate blows up more. >> the stock hit a new 52-week high. jimmy, you talked about what jane frasier has been doing. >> a 17-year drawdown with all due respect to citi. >> now it's time. people try and play a what have you done for me lately game when it comes to these banks. >> it's an accurate description of the history, and i'm not taking shots at you. you clearly have to understand the sentiment has changed. i agree with brian on this. the street is giving jane fraser credit. >> cost cutting. >> no, you're too dismissive of this. for two years she's been right sizing the business internationally getting rid of underperforming divisions whether it's geographical or divisions like municipal bonds, near and dear to my heart. she said this isn't giving us enough return on equity.

we're done with it. the street applauds that and, frankly, the value is there. josh, i don't want to argue with you about this. history is done. what's happening right now the joc stock is generating cash flow. >> we can have a debate which doesn't mean we're having an argument. >> that is new. >> is there a growth story here? >> good question. yes, there is. there's risk. where is the growth story here? frankly, it's credit cards which, if you believe the economy is going to grow strong it's a fine place to be. if you're bearish on the economy and worried about delinquency, i don't want to own citi. by the way, they do a mean business in treasury security for corporations and security processing. >> i want the message to be clear. you can own both. people have said no to citigroup. we own more jpmorgan than we do citigroup. we're pointed in terms of where we own citigroup, but i think it's time to look at the company

again. >> if basel iii is going to be modified and capital requirements -- >> not if, when, because it is. >> i love what i'm hearing from jay powell today. that's going to give citi more wherewithal. at discounts, really meaningful discounts to tangible book value, that's good. let's take a quick break. when we come back, more committee moves to tell you about. josh just sold two important stocks, and we're going to tell you what the trades are next. >> announcer: are you following "the halftime report" podcast? what are you waiting for? look for us in your favorite podcasting app. follow "the halftime" podcast now. erything, and more. thank you very much. [applause] ask, "now what?" here's what. you go with prudential to protect, empower and grow. with everything you need to deliver, you guessed it... more. one more thing...

who's your rock? learn more at prudential.com power e*trade's easy-to-use tools, like dynamic charting and risk-reward analysis, help make trading feel effortless. and its customizable scans with social sentiment help you find and unlock opportunities in the market. e*trade from morgan stanley. with powerful, easy-to-use tools, power e*trade makes complex trading easier. react to fast-moving markets with dynamic charting and a futures ladder that lets you place, flatten, or reverse orders so you won't miss an opportunity. e*trade from morgan stanley.

her uncle's unhappy. or reverse orders so you i'm sensing an underlying issue. it's t-mobile. it started when we got him under a new plan. but then they unexpectedly unraveled their "price lock" guarantee. which has made him, a bit... unruly. you called yourself the "un-carrier". you sing about "price lock" on those commercials. "the price lock, the price lock..." so, if you could change the price, change the name! it's not a lock, i know a lock. so how can we undo the damage? we could all unsubscribe and switch to xfinity. their connection is unreal. and we could all un-experience this whole session.

okay, that's uncalled for. we're back. let's go through the committee moves we had today. that was quick. mcdonald's, i said on the day that you bought it, you almost cornered the burger market with shake shack and needed a couple other names. now you've sold mcdonald's, hit a stop loss on it. did you think you would be in this short time in this name? >> no. you hit it on the nose. when shack reported and just absolutely blew everyone away and all the upgrades started coming in. i just said if i want to hold this position at the size that it is, i don't really need the

mcdonald's and so i tightened and got knocked out of it. down a couple of points more than i bought it. mcdonald's will be fine. it will have a good year. it's not a cheap stock, but it shouldn't be. it's one of the best executors in the space. i'm not bearish on mcdonald's. what else do we want to do? >> shake shack, by the way, you can't talk about one -- >> i can't sell it. >> it just got upgraded to outperform. price target to 125 from 91. >> listen to me now and believe me later, there is no company in this space that, for me, has the same amount of potential right now as shack has, like chipotle is better but that already actualized. this is the one that hasn't yet actualized and i don't want to own both of them. i can't part with it. they're growing now 20% a quarter. so full stop, i can't think of another qsr play growing at that rate. they can because it's only a few

hundred stores. they haven't had revenue growth since the first quarter of 2021 when they were still shaking off the pandemic. they've gotten more profitable. seven quarters ago they were losing money on a net income basis. now they're beating the street on a regular basis. they just saw the best net income this past quarter since they came public, and they're opening stores at a rapid pace, and they're licensing to foreign operators in, like, 30 different countries this is the stock. this is the stock. so mcdonald's is okay. this is what's popping in the street. >> moving a little bit now, too. you sold zoom. tell me -- >> that is not the stock. >> tell me about that one. >> listen, they had a good earnings report. it ran up, and then it started to fall off, and insaid, you know what, life is too short. i only have x dollars i want to -- that i want to allocate to tech and communication services. i don't have any time for this one. i think they'll be fine. i think there is a potential for growth here and the multiple is

like 12 times forward at this point. so it's not an expensive stock. i don't think there's a lot of risk. it's just doing nothing. it failed at 70. i look at it and said i have so many other things i would rather be doing right now than watching paint dry. >> let me ask you this, and this is purely anecdotal, so maybe there is absolutely nothing to it. the fact that i feel like i get many more -- and maybe you all feel the same way, i don't know -- you get more team invites than zoom these days. >> google meet. that's why it's where it is, in the 80% drawdown. the story of zoom is can they -- can they become an enterprise provider for other things and just use the calling feature as the trojan horse to get into fortune 500 companies? they're making some progress. they're signing up customers for upgraded services above and beyond video. we all get that video is a commodity. so they don't have to compete with microsoft. they have to get big enough

where salesforce says, screw it, let's buy it. for my perspective, that's what can happen with zoom. the problem is the pace. it's happening -- they're just not growing quickly. >> brian belski, to two moves quickly from you. you trimmed your stake in home depot. why? >> well, we've owned it for 12 years. it's been a core name in our big cap space. we want to become tighter in certain areas like lulu. >> you bought more? >> we bought more. >> tell me more. >> well lulu brand name, we've owned it for a long time, it's listed in the u.s. we love the theme of lulu and their new product offering and what they're doing. the stock went down a little bit beginning of the year and we bought more. >> leslie picker has the headlines for us. hi, leslie. hi, scott. yes, president biden will reportedly unveil an emergency mission to establish a newport on the gaza coast tonight at the state of the union address. according to nbc news, the move would allow more food, medicine

and other supplies into the war-torn enclave. the operation will not require american troops on the ground. the swedish government formally joined nato this morning, becoming its 32nd member after the prime minister handed secretary of state antony blinken the accession papers. he will be a guest of honor at president biden's state of the union address tonight. and youtuber jake paul is getting into the ring with boxing legend mike tyson this summer, and it will be shown live on netflix. the streaming giant announced the two will fight in what it calls a boxing mega event on july 20th inside at&t stadium in arlington, texas. the event is netflix's latest push into the live sports realm. some metaphors there, but one to mark your calendar. >> thank you, leslie picker. do you think that's going to be a fight? >> i think it's going to be huge, globally. one of the biggest things

netflix has ever had, people concurrently watching. and that's really key because if they want -- >> you're being serious? >> dead serious. >> sometimes i can't tell. >> i think netflix will get like the nfl in a couple of years. this is a precursor, them showing off their ability to coordinate a global audience where people in asia are watching that fight at 2:00 in the morning or whatever. they are going to be able to do something that almost no other platform can do, certainly not broadcast networks, probably not traditional pay-per-view. what you're watching right now is a precursor to the future, and netflix, like, really has the ability -- i know it's not boxing purists will have 80 different problems with this. i probably won't even watch it. i think it's fascinating they're leveling up in live sports in a way a lot of people didn't think that they would. >> netflix up 1.25%. does anybody own netflix on the desk? belski? >> i wish i did. >> i think it's a horse race between youtube and netflix. >> agree. >> for sure they're lining that up. >> you like this move? >> love it.

>> they've been making into live sports. >> we said for a long time netflix is the kleenex of streaming. a quick break and then "cal othlsf e day." bullish on ibm, united health and deere and we have ownership across the board. so we'll give you the trades next. so you can reach today's financial goals. and look forward to a more confident future. voya, well planned, well invested, well protected. awkward question... is there going to be anything... -left over? -yeah. oh, absolutely. (inner monologue) my kids don't know what they want. you know who knows what she wants? me! with empower, we get all of our financial questions answered. so you don't have to worry. empower. what's next. (vo) sail through the heart of historic cities and unforgettable scenery with viking. unpack once and get closer to iconic landmarks, local life and cultural treasures. because when you experience europe on a viking longship,

you'll spend less time getting there and more time being there. viking. exploring the world in comfort. ontario has all the partners you need to make the electric vehicle of the future. with one of north america's largest i.t. clusters. 65,000 stem graduates per year. and all the critical minerals to make electric vehicle batteries. ontario. your innovation partner.

all right. "calls of the day." ibm is where we're starting. price target to 185 at bernstein from 165. a rerating, they say, driven by improved operating performance and competitive positioning, broader market, tech stock appreciation and recently potentially some ai, what they say, pixie dust. new 52-week high. highest since june of '13. six straight month of gains. >> it's in our value portfolio, dividend growth, juggernaut, we will continue to own it. >> okay. united health, top pick. bofa reiterated a buy there. price target maintains 675. jimmy, they say they were overly penalized by the doj news that came out, what, about a week or so ago. >> let's start with they've been penalized heavily and not by the

doj but the medical loss ratios creeping up for all of the health care providers. bottom line, i think too much penalized. i agree with the call at roughly 17 times this year's earnings. this is a stock that has traded above 20 times earnings. a high-quality company in a space that's going to be growing. we know that as people age there will be more need for medical insurance, so i think this is the right time to be buying it. >> even when all of the air is being sucked out of the room by glp-1 players, right, novo today had great news, the stock is ripping. we've had lilly, around a high almost every day, too, even though it may pullback slightly on the novo news. that's where the action seems to be. >> i think that's an absolutely valid point but, also, if you look outside of the glp-1s, other sectors have been performing. look at abbvie, any of a number of pharmaceuticals. i think it's a matter of time and, frankly, soon, the money will start flowing to these managed care providers. >> belski, you own this, too,

unh. >> we own less than a year ago given the problems. everyone is too overweight. we've maintained this position in united health care because of the dividend, the cash. >> i think the stock is breaking down. if you look at a five-year chart, it had substantial support in the 450, 460 area. if you lose that support, this is on a multiyear, not a trading call, i think it tells you that something has materially changed here with the type of people who would normally come and buy the stock on that dip. the fact they're not all of a sudden after repeatedly rescuing the stock at that level, i think you have to ask yourself has maybe the story fundamentally changed given that the buyers aren't showing up here anymore? i would really watch that 450 area ifit gets that low. >> we'll keep our eyes on unh for that. how about deere, jimmy, added to the new, quote, gold trophy list. >> i hope so.

in a portfolio of 25 stocks, got to be honest, i don't love all of them equally. i was passionate about citigroup earlier. i'll be passionate about other stocks. i'm not as passionate about deere. i'm not selling it. i hate being so tied to crop prices and weather patterns. at this valuation, i think it's fair that we can hang on to it here, but i'm looking for that umph. you're hearing the lack of enthusiasm, so stand by. >> you only like the stocks in your book that have gone up. this stock is down 6.5% year to date. >> that's a fair point. >> let's call it what it is. >> that's a fair point and i think it's true of all of us. we do love our stocks when it's going up. >> if it was up 6.5%, yeah, i really love it. feel great. >> what if they just put an nv nvidia chip in every tractor. >> you're making an even better point. the reason to own the stock for the long run -- >> ai farming. what's up? >> is precision farming. i'm not making a joke. you're coming at it from a sense of humor, but actually there's

r reality. >> they turn machines into subscription priced vehicles that you now have to pay for like software. >> look, i'm not selling the stock, but i'm also not buying what you're selling. >> it's not quite that? >> you're buying these big, you know, 100 horsepower-plus combines. >> i grew up on a farm on long island, it was a bagel farm, but still -- >> maybe it's karma. it's karma because, you know, we call you farmer jim, and you don't own a deere. >> i was wondering, as you were setting that up, if you were going to go to kuboda. the end was really cheap, classic macroeconomics, kubota won out. >> look what happened in japan. >> your stock about behavioral investing is well made.

i can't get all enthusiastic. we're going to come back and talk about buybacks under attack and you'll hear about it tonight. president biden expected to take aim in his state of the union address. what he's proposing, how it cae d impact your portfolio beuswe always talk about buybacks and how positive they've been for stocks like apple over time and so many more. well, is something about to change? we'll debate it next. are likely to recommend us. ameriprise financial. advice worth talking about.

glp-1 drugs used in weight loss treatments stand out as the biggest global blockbuster, but these treatments require cumbersome injections. with lexarias patented oral delivery technology, early studies suggest a better way. lexaria bioscience. [sfx: wind, rain and rolling thunder] nobody's born with grit. british announcer: rose is really struggling. it's something you build over time. american announcer: that's 21 missed cuts in a row. [car trunk slammed shut] for 88 years, morgan stanley has offered clients determination and forward thinking to create the future... crowd: stop it! ...only you can see. american announcer: rose, back in the winner's circle. [crowd cheers] [music out]

municipal bonds don't usually get the media coverage the stock market does. in fact, most people don't find them all that exciting. but, if you're looking for the potential for consistent income that's federally tax-free. now is an excellent time to consider municipal bonds from hennion & walsh. if you have at least $10,000 to invest, call and talk with one of our bond specialists at 1-800-217-3217. we'll send you our exclusive bond guide, free with details about how bonds can be an important part of your portfolio. hennion & walsh has specialized in fixed income and growth solutions for 30 years, and offers high-quality municipal bonds from across the country. they provide the potential for regular income are federally tax-free

and have historically low risk. call today to request your free bond guide. 1-800-217-3217. that's 1-800-217-3217. welcome back. president biden expected to take aim at corporate buybacks tonight. the state of the union address. what are we learning here? >> reporter: white house officials tell us president biden will propose quad ruling the tax from 1% to 4% tonight. biden signed that 1% tax into law in 2022 but it has not done much since then to slow buyback activity. so he wants to lift it now so that companies will invest in productivity and the economy as the white house says, rather than a windfall for investors.

this is still just a proposal, and it's one we've seen before. so congress is not likely to move on this anytime soon, but it does still show us one way that biden will be looking to raise corporate taxes to fund his agenda moving forward. scott? >> megan, thank you. we'll look for that tonight in the state of the union. here we go again, taking aim at buybacks. >> i hate when they do this because it's so childish. they have to know that -- they have to know that buybacks are not the reason for the economy not doing what they want the economy to do. surely they have to know that. it's just, i think, a short hand to, you know, give a nod to certain groups who don't know what a buyback is and be like we're on up side with this. it doesn't really help anyone. if you have read -- if you have read anything about buybacks that was unpolitical, just written about businesses that have allocated capital well over years and decades, read "the

outsi outsiders." to do anything other than return the capital to shareholders and then the shareholders you can give it back to them in the form of a dividend, and they have to pay a high tax on that, or you can buy in shares. it's effectively the same thing, but you don't hit people with that tax. some companies do higher dividend and lower buyback. some do both. if you think there's some sort of a tradeoff between r&d or capex or hiring people or giving people raises and buybacks, exhibit "a" is apple. they do everything really, really well. it's a dividend. it's a buyback. it's capex, it's hiring, it's investing. it's a myth that you have to pick one or the other and that buybacks hurt the economy. it would be better to just say, you know what, we need more money, we want to take it from the investor class, take it from the ceo class. just be real about it and that's like a clever way to take it in

the form of an excise tax. let's not act like buybacks are hurting anyone because the realty is they're not. >> an idea, too, bob pisani did some back of the envelope math and meta's $50 million buyback, if this passes -- now it may be dead on arrival as megan suggested -- you're talking $2 billion. >> i'm in such violent agreement with what josh said. telephones so eloquently put. you used meta. he used apple. look at general motors, because i think this is a better example buying back $10 billion worth of share, and at the same time they have been investing for years in electric vehicles, which is exactly what this administration wants. and they just gave a major pay hike to the union, which is exactly what this administration wants. i mean, it's farcical. it's farcical and it's bad for the economy. >> deliberately misunderstanding, which is

forgivable, i guess. >> what? >> it's political. who owns general motors? who owns meta? every retirement plan in the country. so who are you really -- you're not going after fat cats. we have trillions of dollars in 401(k) assets in this country and they benefit from corporations shrinking their float and buying that stock. >> one last thing on this, whenever somebody says it's only a 1% tax. no. that's the camel's nose getting under the tent. everyone knew they would quadruple it and then multiply it by ten. everybody knew this. >> you have a take, mr. belski? you're being conspicuously quiet. >> as a canadian -- >> as an american -- as an american -- >> don't give me the disclaimer either. >> as a minnesota kid, i would tell you this, just keep it simple. it's a correlation that has gone back decades. warren buffett, this is the playbook, period. >> one nuance, if they wanted to

say we don't like sterilized buybacks, if they wanted to say you have a company issue its executives $100 million in stock-based come mps and a buyb, nobody is a fan of that. >> but it's not their position to do it. you know i agree with form of bk most investors would be like, yeah, good, we don't like that stuff either. but does that really pay for anything given how much government debt we have? like, what does that really accomplish? e.m not 100% sur >> quick break. "midday word" on the other side. these straps are mind-blowing! they collect hundreds of data points like hrv and rem sleep, so you know all you need for recovery. and you are? i'm an investor...in invesco qqq, a fund that gives me access to... nasdaq 100 innovations like... wearable training optimization tech. uh, how long are you... i'm done. i'm okay.

we are back. our senior markets commentator mike santoli joins us for his "midday word." much of the same story. apple remains a little bit of an

atm for people. and nvidia is where the cash seems to be going. >> yeah. and i don't know if it's really about taking cash out from one place and putting it in the other. i think both of them are manifestations of the momentum trade being pushed and pushed and pushed. it hasn't broken yet, but it's gotten stretched. if you think about it, the momentum factor is, long in the stuff that's worth a lot, short the laggards, or at least underweight the laggards. so that continues to be way we look at it. apple looks like it's trying to find its footing. i think broadly speaking, what you said is the same story is really what's going on here. there's just not a lot to complain about in terms of the actual action. the market is broad enough. i think the one thing that makes you uncomfortable is it's almost the collective agreement that everything is going right. you know, we have a line of sight toward rate cuts with markets at all-time highs, credit spread is tight.

the economy in decent shape and earnings on the upswing. so i think that the general level of acceptance of that case eventually becomes a problem. but not today. >> sometimes the herd is right. look, chair powell was unambiguously dovish over the last couple of days and sort of said, you know, without having to say it, it's justify why the market has done why it's done. >> he's only been dovish only if you were expecting him to say something different than their framework. but we have had somewhat softer economic numbers. the macro has softened up a bit. and yields are responding to that. that also is a part of the story. so it's not as if, you know, the economy is reaccelerating and he's talking rate cuts in congress. >> no. you're kind of getting what may be a pretty good scenario for what might be the next leg up, who knows? mike, thank you. see you on "closing bell."

"final trades" are next. so this is pickleball? it's basically tennis for babies, but for adults. it should be called wiffle tennis. pickle! yeah, aw! whoo! ♪♪ these guys are intense. we got nothing to worry about. with e*trade from morgan stanley, we're ready for whatever gets served up. dude, you gotta work on your trash talk. i'd rather work on saving for retirement. or college, since you like to get schooled. that's a pretty good burn, right? got him. good game. thanks for coming to our clinic, first one's free. [♪♪] your skin is ever-changing, take care of it with gold bond's healing formulations of 7 moisturizers and 3 vitamins. for all your skins, gold bond.

at pgim, finding opportunity in fixed income today, helps secure tomorrow. our time-tested fixed income suite, backed by over 145 years of risk experience, helps investors meet their goals. pgim investments. shaping tomorrow today.

welcome back. we'll do "final trades" in a moment. we want to get the setup on some

important mornings in "overtime" tonight. we barely mentioned broadcom. the stock has done quite well. it's not just an nvidia story. >> no, it's not. we use broadcom to our valuation of nvidia and we love that name. i think it's a name -- come on. >> will the real brian pellski please stand up. >> listen, we like the name, great earnings, great cash flow. we love it. >> okay. i don't know if that was any better. costco is today after the bell, as well. >> i've owned the stock for 12 years. it crushed walmart and target for ten years. we love that name. great management team, great operator. we're going to continue to buy more. we own it and love it. does that matter? >> a lot. you have a final trade? >> yes. at&t.

>> jimmy? >> amazon. >> thank you for that. >> liz? >> energy, i think it gets the rotation and pays good dividends, so as rates come down, look at it. >> jp this >> my lock of the week, robert downey, jr., best supporting actor sunday night. >> home team? >> it's a comcast movie "omen h -- oppenheimier." >> all right. "the exchange" is now. ♪ ♪ all right. thank you very much, scott. welcome to "the exchange." coming to you live from the newly revamped studio a at cnbc global headquarters. here's what's ahead on the show. biden and business. president expected to go after the wealthy and corporations in the state of the union tonight. we look at the changes he wants to make and the potential impact for businesses and for wall street