maria: welcome back. one thing you need to know about ahead of next week, the barbenheimer duo receiving buzz with nominations a announced this upcoming tuesday. other best picture favorites include killers of the flower moon, poor things and the holdovers. just under $9 billion spent on movie tickets in 2023. that is the highest grossing year for the box office since before the pandemic. we'll be following it all on "mornings with maria" weekdays 6-9 a.m. eastern on fox business. meanwhile, see you on sunday, 10 a.m. eastern on the fox news channel for "with sunday morning futures." ooh i've got interviews with chairman michael mccaul, chairman mark green and former department of defense chief of staff kash patel. join me sunday live on fox news. that'll do it for us here for now here on fox business. thanks so much for joining us. have a great rest of your weekend, and i'll see you next time. ♪

♪ ♪ ♪ ♪ jack: welcome to "barron's roundtable" where we get behind the headlines and prepare you for the week ahead. i'm jack otter. the fed hiked rates above 5%, blackrock's rick rieder oversees the largest pool of fixed income assets in the world, and he'll tell us how he's investing this cash in 2024. then barron's convened its annual panel of investing guru to discuss what the new year holds, our experts will share their favorite stock picks. and later, selling season has begun for the housing market. we'll tell prospective home buyers what to expect. we begin, as always, with three things investors ought to be thinking about right now. stocks hitting a new high despite worries that strong economic data means the fed

won't cut rates as quickly as markets have been expecting. then some big changes for one of the big oil companies. bp has a new ceo and could be pivoting away from esg initiatives. and finally, disney's iger has been trying to turn the company around over the past year, but the stock is down, and many of its franchises are hurting. my colleagues, ben leveson, megan leonard and andrew barry. ben, you were concerned the market had been flirting with a new high, wasn't able to close the deal. the s&p has done it, a new pr. did investors decide good economic news is actually good news? >> i think that's what happened. earlier this week it was watching the fed, it was getting good economic data, and it was freaking out because we went from having a very high chance that we're going to get a rate cut in march to a lot lower chances. the market rally was really predicated on the fed's trying to cut rates. but i think people looked at the data, and they see retail sales are holding up, jobless claims are back at lows, and things

just look to be okay, and we're seeing some chickically sensitive stocks -- economically sensitive stocks doing very well. invideos ya's at -- nvidia's at a new high. >> you know, the market's been shrugging off weakness from the bond market. the 10-year treasury's up about a quarter percentage point, you're seeing weakness in utilities and real estate. jack: yeah. see what happens there, consumer sentiment very high, but if rates go up enough, that's going to back down again. okay, next week, what are you watching particularly carefully? >> we're going to have earnings from verizon, at&t, industrials like ge. and for me, i think the industrials are really important to watch. they've been doing pretty well, and if their earnings come out strong and they say some things about the economy that their outlook is also pretty good, i think that can give people confidence that this kind of economic data we're seeing can last trout the year. -- throughout the year. >> keep in mind that png is definitely coming out this weekend. i think that's one to watch.

we've seen the pricing strategy on the higher end, and cash-strapped consumers do start to down trade. that could mean interesting moves ahead for them. >> and we're seeing also investors not having as much interest in things like consumer staples which actually dropped this week. >> if p&g and others stop raising prices, consumers will not be crying. investors might be though. jack: andrew, bm named a new ceo. you're a fan. >> you know, american investors generally don't look to europe for energy stocks, but bp's worth a look. you know, the company is back to doing what it does best which is produce oil and gas. it had pivoted away from that a couple years ago when it caved to climate activists and said it would cut production by about 40% this decade. that didn't fly, now it's basically back to doing what it's good at, producing oil and gas. and it has a very strong asset base in the unite -- in the united states. jack: it no longer stands for beyond petroleum.

tell us about the fundamentals. >> yeah, the company trades about 7 times this year's earnings and a 5% dividend yield. jack: could there be a buyer? that's the one sort of big chunk left. >> it's a $100 million market value, but on the sum of the parts, what was double the current stock price you could have an activist go after the country to break it up and maybe even shell, its larger u.k. oil company could offer to buy it. jack: speak of activists, megan, let's take a look at disney. bob iger came riding in on the why is horse, everyone cheered. stock has not done well, and now nelson peltz is rattling the sabers. >> yes, this week has been a big one for disney. we had some activist interaction. nelson went off and wanted those e two board seats. we'll see what happens there. but as my colleague howe points out -- jack p.o.w. hoints out, there's a number of challenges facing the companiful it's not only the thing like the marvels

movie which was really quite terrible, but, you know, we also have dreaming -- streaming in the background going on. the bright point, of course, is the parks. those are always a nice boost for investors and for, you know, folks that do actually enjoy the disney parks. but, you know, when it comes to some of the fundamentals, i mean, streaming is obviously a big one. we need to keep looking at how that works out. i love the loki show that was on disney+, but it's a tough game, and i don't know their subscriber numbers are exactly where we want to see them. jack: they're way below their target for 2024, right? >> absolutely. they had wanted to have about 260 million by 2024, so this year, and they got to about 164 million, i believe, and they actually back slid a little bit. so as of september, it's been about 150. we'll have to see where things shake out, but it's definitely one to watch. jack: netflix reports this coming week, and and i've got to quote the bank of america analyst that says netflix has won the streaming wars.

all right, my next guest says a recession is nowhere in sight. plus, what he considers the new normal for the economy. blackrock's rick reider joins me right after this. ♪ ♪ if a force to be reckon with. no, not you saquon. hm? you! your business bank account with quickbooks money, now earns 5% apy. 5% apy? that's new! yup, that's how you business differently.

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morning star's 2023 portfolio manager of the year overseeing $2.8 trillion, that's the largest pool of fixed income assets in the world. hello, rick are. thanks for joining us from not so sunny florida. >> thanks for having me. jon so you describe the economy as, quote, an outbreak of normality. what do you mean by that? >> so i think that, you know, i think the world likes every week or so to talk about why we're going to go into a recession, deep recession. and i think there's a group that just wants to talk about it. and, you know, if you think about we've come through this extraordinary explosive growth fueled by monetary fiscal stimulus and now we're going to pretty normal and we think this year 1.5% real gdp at about 2.5% inflation, when you add the gdp to inflation, you get 4% nominal gdp. that's what we ran for decades. so you see parts of the economy that are moderating and other parts that, quite frankly, are quite strong. look at the corporate spend, look at the consumer. some areas the consumer 's

slowing but other areas not. this is what a normal economy feels like, and i think those that, you know, for two years now are saying it's about to come, get ready for the recession, i just think in a service-oriented economy it's a lot better than people give credit to. jack: let's talk about inflation. it's coming down, of course. still not quite to that 2% level. what is between where inflation is now and the holy actually of 2%? -- holy grail of 2%? >> we've made a lot of progress. so we think this month core pce, that's the measure that the fed is most focused on, we think this month if you'll see it about 2.7% year on year. we think by the middle of the year you're down to 2.5%, and then it's probably pretty sticky there. you know, it's still hard to bring down wage inflation. you know, we're stabilizing about 4.5 president. there are parts of inflation insurance, you know, health insurance, autoinsurance, shelter where it takes rent rolls to run off, it takes years for that to happen. those things are still sticky.

goods inflation is actually, it's actually deflating, moderate deflation. i think you're going to 2.5, and i think you'll stay this. not that far from the fed's target but, gosh, you think about where we were run, 8%, 9% type levels back a couple of years, it's pretty good. i think this is, again, back to this point of this outbreak of normality. this is about what we run in a mature, technology-oriented economy like the u.s. is. jack: so given all that backdrop, you'd describe this as an historic opportunity for bond investors. why is that? what are you seeing? >> so i think people underestimate, and now we've had people sitting, we've recommended sitting in treasury bills, commercial paper garnering 2-year notes, you know, you've been getting 5%, 5.5%. for the first time we're on the verge of the fed if going to start cutting interest rates. i don't think they're going to start cutting in march, but i think they're going to start cutting in the middle of the year. and then so now you can lock in yields at, you know, at 6, 6.5%.

you know, we sent over this chart where we looked at the dynamic around, you know, total return. people have to start looking at the total return are. gosh, i want to lock in. can i buy a- year treasuries, can -- 5-year treasuries. we run an etf, we're flipping 6.6, 6.70 yield, and you can perform if rates come down like we think they will, you can get 8, 9% out of a fixed income portfolio,,s that's pretty good. and, by the way, it doesn't mean taking a lot of rusk. you don't have to go to 30-year treasury, deep into high yield in the aggregate. so that's e a pretty good environment that you can sleep at night and clip an awful lot of yields. jack: tell me there's a spread e between the 10-year which is, what, a little over 4 now and that 6.6 you quoted, that a owe. you must be taking a bit of risk to get that yield. >> 100 percent. so, you know, to get, think about it, to get that sort of

yield, you do a couple things. and, you know, we're comfortable with, not just u.s., european if high yield. and because of the benefit you get from being a dollar investor, that gets you some additional yield. we like securitized assets, things, you know, general asset back withs, part of the residential mortgage market that get us also, the clo market, gets us some additional yield. but, gosh, you marry that to things like investment grade credit, agency mortgages, what happens is we can run the yield. we're actually running a yield that's actually higher than a double b with high yield and half the volatility because we're using high quality assets like mortgages and investment grade to supplement things like high yield, some of the securitized asset ises. so build some balance in it and then, you know, create -- look at over the last 6 or 9 months the returns of the etf have been tremendous. and i think people underestimate, you know, when the fed starts reducing rate, you've clipped this 6.5, 6.60, and it'll turn out to a higher

return than that. so a pretty good environment for that. particularly if you're an equity investor and looking for something that gets some yield and income. jack: sure. mortgage rates tough for homeowners but real nice for investors. rick reit or, thanks so much for coming on. >> thanks for having me. jack: barron's annual round table convened to discuss their 2024 market outlook. the pros say gains won't come easy this year, but they did have some favorite stock picks to share. our panelists break it all a so... - we're engaged! - we're engaged! congrats carol! your youngest finally popped the question. but now, you're really going to have to get those new dentures. after all, you need a smile that matches the moment. so this might be a good time to mention that aspen dental can create natural looking dentures in no time. just for you! and that comes with $0 down plus 0% interest if paid in full in 18 months.

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jack: barron's convene ised its annual round table to dissect what's ahead in the coming year. investors who made the case for stocks they think can beat the market, it's the cover story

this week. our panelists have pulled their favorites from that list. so they weren't incredibly bullish, andrew, but of course, as always, they do have some picks. i'd say kind of a value tilt, not entirely value. you chose two stocks that you're interested in. one i'm going to start with because meryl whitmer likes a company you've been writing about for years. >> yeah. and meryl whiter in is on the -- whitmer is on the board of berkshire hathaway, and one of her picks is graham holdings which used to be a washington post company. it's controlled by the graham family, and it changed its name after it sold "the washington post" to jeff bezos. her theories on the company is that the company on some -- the sum of the parts is very cheap, worth about $1,000 a share versus the current price of $700 a share. it's a dizzying array of businesses including education, broadcast tv and even owns a group of washington, d.c.

restaurants, a washington hot spot. jack: is she hoping for a pinoff or she just thinks even if it sticks together, it could be a good company? >> think she -- she thinks they should consider breaking identify, there are very few conglomerate with so many different businesses. jack: i once spoke to a guy who worked there, had read your story and said, how does he know those numbers? we don't report those numbers. i said, that's andrew bary are. everest group. >> black is a details-orient9ed value investor and a lot of facts and figures in his analysis. he likes average we've relates group, it's a bermuda reinsurer. the company's benefiting from a hard market insurance which means that prices are rising. it's benefiting from higher rates for property catastrophe and other insurance coverages. it should be benefiting from the fact that there were no major hurricanes last year in florida,

so it should clean up on that. he thinks it's time -- trading at about 6 times earnings but 1.5 times value. jack: megan, waste connections. tell us about that company. [laughter] >> right? sexy name. hey, i think this is a really interesting pick because it's sort of like death and taxes. i feel like society needs its trash collectors. no matter good economy, bad economy, this is always a good pick. david really is keen on the leadership here. it was interesting, the founder stepped down as ceo in 2019 but returned to the role e last year. so there's a lot of upside momentum here. and, you know, it doesn't hurt that the company is trading at, like, 10% discount compared to historical names. jack: that was david giroux of t. rowe price. also intel. >> yeah, tom picked intel as a value may which i thought was kind of an interesting choice. intel to me steams like it's past its heyday and yet keeps coming back around -- jack: we see a short-term chart that looks pretty good. you look back to 2000, it's not

a pretty sight. >> not so much. todd really did point out and i think rightfully so that a lot of this recent momentum is due to the ceo coming, you know, and this is kind of interesting because under his leadership they've rah really doubled down on process technology which could be a major advantage. i mean, already intel is performing, you know, among some of the best in the dow last year. so certainly, or you know, a lot of upside here. todd believes 2-3 years, maybe 3-5, we could see this as part of the magnificent seven. jack: and they're building a huge plant in ohio, so that's going to be interesting. >> exactly. jack: ben, what did you choose? i know on semiconductor, but first, i'm looking at my notes, yes, you like get sinker, yearly, etc., but not so much the ceo of meta. >> everybody hates mark zuckerberg. i know andrew might say that's not true, investors love him, but really everybody hates him. the thing is that this company, whether you like him or not, the stock has done extremely well since the end of 2022 when mark

sicker berg -- zuckerberg pivoted away from the metaverse. you might not much like facebook, but your grandparents are probably on it, and you might not like instagram, but your kids probably are. the metaverse play, maybe it works out, if it doesn't, they'll scale it back. the stock -- bill priest really likes the stock. i think it looks good despite the fact that it's gained so much. jack: on semiconductor, you picked that a while ago. not the best timing, but you're going for it again. >> i got the timing wrong, had a problem with auto, but it's been spending a lot of investment. its cash flow has not been as strong as it could be. those investments are probably behind it, so you could see cash flow go from $2 a share to about $7 in 2025 which would be a huge move. for that to happen, you really have to see this investment get pulled back, plus you have to see the automotive business, evs in particular, they need to start solidifying a bit.

[laughter] jack: that's a fascinating business though. we'll see what happens with china and taiwan. ben and megan will come up with money moves, and andrew sees some spring surprises for home buyer withs, so stay right there. ♪ students... students of any age, from anywhere. using our technology to power different ways of learning. so when minds grow, opportunities follow. ♪

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jack: andrew, "the wall street journal" just reported that last year marked the 28-year low in existing home sales. that actually could be bullish for new home sales. you spoke to doug yearly, the ceo of toll brothers. >> yeah. basically the public home builders are accounting for an increasing share of new home sales in this country, and that's bullish for toll and the bug public builders including lennar and dr horton. he's actually bullish on the spring selling season which actually gets under way this month in the warmer parts of the

one. -- country. the stocks had a big run in the past year, they were up 50-75%, but toll is still trading around 8 times earning, and one bullish development, you saw a japanese home builder buy -- this week which is a smaller public building, toll might be a good acquisitions for berkshire hathaway. jack: from the buyer and seller perspective, anything interesting right now? >> sellers are staying put partly because they don't want to give up their 3% mortgages, so a relatively low supply of existing homes. jack: interestingly, the hot markets in the sun belt cooling off, the cold markets on the coast are doing better. >> yeah, essentially in the new york area things are relatively strock, and california's also doing quite well despite what the naysayers are saying about that. jack: interesting. meg ganger you've got a money tip. >> i do. interestingly, new federal rules proposed actually eliminating or dramatically reducing overdraft piece. we've heard a lot about this and, of course, these are still

early stagings. so folks who are setting their kids up, obviously, maybe look for a bank that's already eliminated them or have one of those no-fee accounts. jack: all right. ben, what's your idea? >> lamb research, they make equipment for chipmakers, and they've been very strong. they're not a cheap stock, but they are breaking out. and as long as these a.i. chips are in demand, they could do pretty well. jack: and we've been talking about the increasing demand for chips, and they are a crucial part of that value chain. thanks, guys. to read more, check out barron's.com, see the rest of those round table picks. don't forget to follow us on x, and that's all for us. we'll see you next week on "barron's roundtable." ♪ ♪