it's really on the retail side for a trade. i think that was good. i think it gave validity to the story going forward. >> i think he's extrapolating present trending assuming things will be linear. they will not be. this is going to be a tougher business than easier business. it's a tough call. >> guys, good stuff. "power" starts now. ♪ ♪ once again, we've got some pretty big moves and commodities today. oil off session highs but above $51 a barrel. gold hitting the highest level in nearly a month and look at the action silver up almost 4% today. welcome to "power lunch." i'm melissa lee with tyler and michelle and brian starts us off with a look at oils run. >> yeah, let's talk about oil. crude oil on the highest level since last july and with us cnbc contributor and partner with again capital. john, we love you, you know that. >> thank you. >> i'll throw you under the bus

a little bit. you were negative on oil. it's gone up. are you staying negative or has something so fund mentally changed you're saying i was wrong, it's go up? >> i was obviously wrong. i'm not sure if i'll stay wrong, though and we've come such a long way it's hard to advice folks to get in here especially with, you know, some of the signs that i continue to see that undermine this rally, brian. particularly last night, the chinese trade data was bad and i keep saying that part of the oil rally here for it to sustain itself needs to be a strong asia and a strong china in particular and we're just not getting that. >> you were spectacularly right before. you were one of the few people in the really negative camp and you were right. >> you were right before you were wrong, how about that? >> i'm not running for office so i can be wrong -- >> thank you for that. >> i got some beach front property in arizona i'm going to sell you, as well. what would be the most -- if you had to pull out one bullish case and one bearish case, the most

of each, what would they be? >> to make them. >> yes. >> for starters, the situation in nigeria is getting worse and worse. the government there -- it could be as bad there as venezuela. united and one other airline pulled out of there today because they are not getting paid for the fairs people are booking on flights. there is a lot of hard currency problem. makes trouble and tap will go away. they are talking more of a hard core line. that's probably one of the biggest bullish factors that's out there, as well. and i think the biggest bearish factor is two-fold. it's hard for me to believe there won't be a rally in the dollar once the fed finally gets into interest rate hike mode. i do not understand how the yen for example can stay so strong. >> when is that? we keep pushing that day back. >> it's got to come soon. our economy relative to the japanese and other economies and what lies ahead has to be

stronger. also, too, there was one nugget we saw a slight uptick in u.s. domestic production. the shale boys are coming back to the trend that -- >> bottom line me here. it's always going to be lower on labor day and lower on election day and christmas day than today? >> yes, yes and possibly. >> loving you is wrong, i don't want to be right. [ laughter ] >> notice he didn't give the year, though. he said on christmas -- >> he hedged, man. >> i think a lot of angst around supply, i think we're a little early saying the market balanced. i don't see it balancing until 2017. there is elements to this. it's been a spectacular run but we're at a point where it will be hard for it to continue. a lot of head winds. >> listen, i love it. you're sticking by it and when oil broke down to 51, it was panic sicity. we're at the same 51. 51 is 51. >> the high last year was in july, brian, around 53.

>> john, thank you, sir. >> thank you. another commodity moving higher, gold up more than 1% today near a three-week high. it's bring inner rick. good to have you here. what's driving this? it's not unusual that we're going to have commodities move at the same time when you see weakness in the dollar. is the dollar behind the gold move or what? >> the dollar after friday's payroll deaf nfinitely a factor even we saw interest rates in germany move almost to zero and almost to negative. people have to put their money someplace and having a market that moved above 1250 encouraged people to put their money back in gold. >> a lot of people look for confirmation from chinese buyers, also particular indian buyers who really do buy physical good as a store of value. do we see them buying here, as well? traders often look to them for confirmation. >> over the last couple days we

certainly don't have confirmation of them buying. what we have seen is good interest option plays here that's closed the volatility of the market in options play. so certainly been underlying buying in the market. >> what do you do from here? it is simply watching janet yellen at this point to decide what will happen with the moving gold? >> well, with currency destruction across lots of platforms, gold definitely wants to move higher. i'll thi i'm thinking we could see 1290, 1300. >> thank you. a lot happening in the bond market around the world. right now, ten-year notes up for auction. those are benchmark papers rick san te santelli. what's the demand like? >> i give the auction a b, b as in bravo. it's a nine-month 11-year

auction. having said that, the yield 1.702. above 170. 170 and a half was trading for the most part. so that was pretty good on the pricing structure. 2.7. $2.70 of investor money chasing every dollar worth of securities available or over subscribed to by factoring 2.7 above average. 73.6 on indirects. listen. i have a good-sized database. i could not find a higher indirect percentage. direct 7.2 was the only slight fly in the ointment. that was a bit below the 12% ten auction average. as i said, i gave it a b. i'm a little surprised a it wasn't more aggressive with regard to interest rates but we have the 30-year tomorrow and the long er maturity seems the best.

t tyler and the goang, back to yo. >> tesla working with panasonic to supply batteries for the model three according to the ceo elon musk. let's look at the tesla shares higher by $3 and change or about one and two-thirds percent. southwest airlines 6.4% increase in passenger miles for may compared with the year earlier. key met trick in the business and expects to incur a modest increase in current quarter operating revenue versus a year ago. southwest higher by 44 cents at $43.51. dave and busters beating estimates by 13 cents. the arcade and restaurant chain raised its outlook for the year and announced a $100 million stock buy back program. dave and buster shares up $4.66. that's more than 11% at 46.52. more republicans distancing themselves from donald trump.

who is bailing now and is trump potentially in trouble? next up, another conserve zesse says the price for the nomination is not over on the gop said. and automation nation, are robots stealing our jobs? that's debate and more coming up. what are you doing right now? making a cake! ayla reminds me of like a master chef and emiana reminds me of like a monster chef. uh oh. i don't see cake, i just see mess. it's like awful. it feels like i am not actually cleaning it up what's that make mommy do?

(doorbell) what's that? swiffer wetjet. so much stuff coming up. this is amazing woah. wow. now i feel more like making a mess is part of growing up. stop cleaning. start swiffering.

what would help is simply being able to recognize a fair price. that's never really been possible. but along comes a radically new way to buy a car, called truecar. now it is. truecar has pricing data on every make and model, so all you have to do is search for the car you want, there it is. now you're an expert in less than a minute. this is how car buying was always meant to be. this is truecar. ♪ so where in the world can an investor cost billions of dollars and sue for unfair

dismissal? you only get one chance. france. remember the rogue trader who was jailed for causing a record $5.6 billion trading loss? french labor court ruling the bank fired him without real and serious cause because it waited too long to dismiss him. the court ordering stock gen to pay him. sto adding fuel to the controversy of the role of labor courts in france after the government dropped an attempt to limit the amount of damages they can award for wrongful dismissal. labor has an enormous amount of power in france, not just the court systems, everywhere. it really hurts their economy and this is so emblem of that. >> can't get fired in france. >> can you imagine being the stock gen lawyer arguing that

case? >> no, no, no. it's a tough place. you see the protests that happened because they want to increase the workweek and do things and here in the united states, we take it for granted but they are -- >> normal. >> forget about the country, just this kind of a headline and i'll throw stock gen into the wall street club because it's a bank and they have a u.s. presence. the headline, optics of trader loses millions, wins -- >> wins judgmenjudgment. >> great headline. >> after we went to jail for three years for trading. >> all right. rick santelli give the ten-year rating a b. bob is live with fitzgerald ceo howard. >> we're at the global exchange conference, the heads of the exchanges around the world and many big broke ridge firms. howard, we're sitting near new highs right now in the markets. what is your impression of the

markets? where are we? where do we sit? >> low interest rates chases you out of the ability to put your money in some high-grade bonds. it's a risk on world, which is if i'm going to retire, i got to make money. what am i going to buy? stocks. stocks are i like to use the term melting upward. there is no sort of raw, raw, let's go out and get them but they continue to improve because low interest rates push money into the equity markets where at least they can get a reasonable return. >> tina, there is no alternative is a bit of a cliche but yet, you seem to be implying it really is true and no alternative. >> bgc partners has a 7% dividend. the stock is performing really well because if you think about it, where else can you get a 7% dividend and stock growing? you can't buy in the bond market. commodity markets are scary. >> big player in the bond market, as well. your thought here? a lot of people feel that rates

have to move up. bond yields have to move up a bit but haven't that much and certainly big global demand for any client of instrument that has a yield. we have better yields than most of the rest of the world. where is the bond market going? >> imagine germany yesterday, four basis points. i don't know what that is. >> for a ten-year. >>.03. >> that means you give them your money, $1 million for a year and you know what you do? buy coffee for your office with the interest. this isn't like an interest rate. so the u.s. at least still has a reasonable interest rate. we have a growing economy. they don't. that's the key. so our stock market is going to do okay. right? and i think we're still going to have the fed wants to kick up interest rates here. i view interest rates as sort of a spread like a lead off first base. 1% interest rate would be you move to second base. we're at a quarter of a percent. when we get to half a percent. we'll be like a major league baseball player taking a nice lead off first base. the fed has to bump it once to

get the heck away from zero. >> are we going to have a problem with bond prices at all? should the bond investor be doing now? >> look, the u.s. is attractive because at least our ten-year note is yielding 1.7%. switzerland is negative. german know is all most zero. japan is zero, negative .13. the u.s. is the best place with presidents on its money, not bridges. you know, the eros has got all sorts of problems. you got to like the dollar long term. our economy is growing reasonable well. maybe 1.8 instead of 2%. >> mike has a question for you. brian. >> howard, how are you? listen, this is a little out of left field but a segment coming on i wanted to ask you about it which is increasingly we've seen the story automation is going to basically eliminate jobs. wall street may be no different. i know people replaced

personally by software and quantities. is there going to be a future of the human wall street. automation doesn't take vacation, doesn't require health care. what's the future of wall street. a lot of your employees and people are watching this and worried about their jobs. >> look, the world of wall street is going to change, so you had this world where the buy side would do their trades with the big banks and what happens in fixed income. you think about fixed income for a minute. there are so many different ways to do fixed income. with you trade a stock, you want to trade bcg partner stock. one name. in bonds there is all sorts of ways to do stuff. a bank would buy a and sell b and c and d. all of that automation will help but in the end, what you're going to see is wall street guys are going to get jobs at what used to be called buy side and help them automate and become better, better at entering the

plumbing of the finance system and you're going to see a demockization of the markets and act like the banks. the banks will act like the banks of old and there will be more players. so i think they might have lots of jobs but maybe at different firms. >> before we let you go, we have a presidential election on. looks like hillary clinton versus donald trump. your thoughts and how it might impact the markets? >> if someone said to me two years ago, there would be a new york senator versus a new york businessman running for the united states of america. you would never have believed me number one. you got really one of the great new york personalities who just, you know, he just, you know, can play the television. the guy had 13 years of running a television show. he understands ratings. he understands the people. against really just an incredibly well-known, you know, world famous rock star politician. i think these will be the greatest debates, the greatest thing for politics.

the world will laugh but will make american fun to be in politics again. >> markets. >> what happens is not as much as people think. i think brexet is really good for markets. up to me, i would vote, exit. leave. why? that creates excitement. they don't lose. we just like volume. i think the greatest debates ever -- by the way, i'm friendly with both candidates. i get to go to the white house for coffee. that's good. >> tyler, did you have a question? >> no, actually i didn't, thank you. >> i'm sorry. [ laughter ] >> we're going to let that go then. my thoughts -- [ laughter ] >> howard, thanks so much for joining us. always a pleasure and fun to chat with you. tyler, i'm tossing back to you. >> i agree with that, always good to have howard on with us. on that political note, wisconsin governor scott walker backing away from an endorsement of donald trump today. he told a radio station quote trump is not yet the nominee,

officially that won't happen until the middle of july so for me that's kind of the time frame. whatever that means. yet senator mark of illinois said he would not back trump. conservative radio host hugh hewitt and cnbc contributor will join us later in the segment about automation. he's here now. he believes it is very possible that trump will not be the nominee after all. he is live for us in washington. how would that happen and why do you think that's a possibility? >> you know, you were listing off names and let me toss in newt gingrich that called trump an absolute armature. he's supposedly on the trump short list. listen, the rnc delegate rules are not a suicide pact. if you imagine, you know, three, four, five more weeks of bad news, bad fund raising and this is probably most important, bad polls because those close polls have really void trump here of

late. these delegates, the rnc rules committee can change a rule, free the delegates or put in a conscience clause if you feel this candidate does not -- voting for him would go against your believes, they don't have to vote for him. this is not a done deal until it's absolutely a done deal. >> are you hearing that this kind of talk is circulating in the delegate circles or quote establishment of the gop? >> listen, a certain level of talk is sort of never seized and it's ramped up over the past week. if you would have asked me three weeks ago, i would have said listen, you know, the parties rallying around trump, they are doing joint fundraising together, this isn't going to happen. this sort of suicide attempt by trump of the last week with these judge comments and really this sort of not really an apology that he gave for the judge comments, i think this thing is not a done deal that we thought it was maybe three weeks ago and listen, if you look at betting markets, they are

starting to treat trump like he's a regular republican candidate. those betting markets are -- i think i play some stock in those. they have widened again dramatically. >> you bring up a good point, jimmy. the rnc and dnc are private organizations, not government organizations. they make the rules and can change the rules at any time and we heard talk for a long time about whether or not it's possible. you raise the same question for the dnc, as well, right? i know hillary clinton won california but still, the bernie sanders followers have options if they really want to make a mess of the convention, as well. >> i will say i think the democratic delegates have a conscience clause -- >> they do. >> they couldn't vote for hillary. certainly sounds like bernie sanders, this may be more of like i'm going to fight for my ideas but remember, ted cruz on the republican side is not endorsed donald trump yet. that campaign could theoretically be restarted and some other horse may get in. that's the problem with sort of the hashtag never trump.

is that they really haven't had a horse. maybe that guy is scott walker, maybe somebody else. >> do you need paul ryan to go along with you? >> that would be key. if paul ryan said listen, i've reconsidered. he looks like he's a fiasco and does not represent values. i urge people to vote their conscience. it wouldn't have to be more than that and i think it could be a real donnie brooke. >> jimmy, we'll see you in a little bit. he'll be back when we talk robots. >> oh, man, great. >> we'll fight. >> jimmy versus me. >> housing turf wars and companies enticing home buyers to buy them from. we'll ask the ceo of realtor.com. that is next when "power" returns in two minutes. with usaa is awesome.

homeowners insurance life insurance automobile insurance i spent 20 years active duty they still refer to me as "gunnery sergeant" when i call being a usaa member because of my service in the military to pass that on to my kids something that makes me happy my name is roger zapata and i'm a usaa member for life. usaa. we know what it means to serve. get an insurance quote and see why 92% of our members plan to stay for life. [phone buzzing]

some things are simply impossible to ignore. the strikingly designed lexus nx turbo and hybrid. the suv that dares to go beyond utility. this is the pursuit of perfection. we are the world's connectivity company. we are business & entertainment & innovation. we are at&t. we're mobilizing the world like never before. that's the power of &.

take a check on the markets. green arrows across the board. the s&p 500 is up by just about a quarter percent. tight range on this particular major index of seven points in today's session and as for the nasdaq, it is up by .3% and the move in transports, this is the third day of gains hearing this as we see oil gain once again. an interesting move. higher by transports usually dinged by move higher in oil. brian? >> all right. on deck, jeff bazos and amazon betting big in india. what they are putting into the country plus, what the dickins

the tale of two retailers, one down and one up 30%. one housing, one clothing, the tale of the tape and an interview with the head of realtor.com. stick around. make healthcare more personal with patient-centric, digital innovations; from self-monitoring devices that can interpret personal data and enable targeted care, to cloud platforms that invite providers to collaborate with the patients they serve. that's why over 90% of the top 25 global pharmaceutical companies are turning to cognizant. our domain experts, technologists, digital and data specialists, clinicians and scientists are transforming the way clinical research sites collaborate with pharmaceutical companies, and enhancing patient engagement with innovative platforms and solutions. our population's growing healthcare needs present growing opportunities for our clients: to advance the future of medicine with digital, and improve the quality of lives.

♪

thank you. ordering chinese food is a very predictable experience. i order b14. i get b14. no surprises. buying business internet, on the other hand, can be a roller coaster white knuckle thrill ride. you're promised one speed. but do you consistently get it? you do with comcast business. it's reliable. just like kung pao fish. thank you, ping. reliably fast internet starts at $59.95 a month. comcast business. built for business.

hello, everybody. i'm sue herrera. syrian opposition activists say air strikes and rebel held districts in the city of aleppo killed at least ten people and left many wounded. they say one of the strikes hit near a hospital. aleppo has seen an uptick in violence in the past 48 hours. >> secretary of state john kerry arriving in abu dhabi to focus on the crisis in syria and y yemen. barbara leaf greeted kerry with em rid officials. rail workers in france went on strike and held a protest against the government's proposed labor reforms. they threatened to continue that protest through the eros 2016 soccer tournament, which begins on friday. and general mills is releasing the first new cereal brand in 15 years creating tiny toast. look at that, it is tiny in

blueberry and strawberry varieties. it does not contain artificials flavors or colors and free of high frutoce corn syrup. it will probably arrive in my house this month for the kids. >> thank you very much. a check on the gold for the day. we see a strong bid higher in gold. a big part of the trade is a dollar in the index, dixie five-week lows and strong for bonds. the ten-year breach 1.7% today. a bid for safety in today's session gold up higher 12.62 an ounce. take a look at the rest of the metals being helped by better than expected chinese may import data. silver up 4% and platinum up by more than 1% right now. speaking of bonds, a check on the market. rick santelli, rick? >> hi, melissa lee.

the short maturities tonight to be somewhat glued at the wall. more flattening, twos are down one, fives are down one, tens are down three, 30s are down four. yes, the auction was above average. look at the day of tens and melissa nailed it, we're drifting under 170. the low interest rate trade on the boons were three basis points. we are now three basis points away from an all-time challenge at least on this move. the all-time low is around 138. the february 11th of 2016 low for the year, though, is 166 and that's what we're three basis points away. you can see the drift and if you look at boon hooverering, the more we get pulled down along with it and another drift going on. look at one woke of the dollar index drifting, as well and exactly may 4th since we've closed down here as melissa lee said, five week extreme.

tyler, it's yours. >> rick, thank you very much. german yields amazingly low. stocks continue to inch higher as crude oil sits above the $50 a barrel mark. will this momentum keep up or slow down ahead? let's bring in art, ubs financial director of floor operations. art, welcome. good to have you with us. the market is inching higher as we just said but is it inching higher for enduring or what i would call good reasons for lack of a better term? >> well, i don't know that that's the case. i think some of it is self-induced. you know, they sense that we're near making an all-time high, as long as we're up here let's try it. we have season nty to it. june is mediocre month, the first two are okay before an exploration, which we're having now. we'll have that a week from friday. so you have some of those things working. it is important, however, that

we try to hold on to these gains. oil slipped back below $51. if we give up these gains, we have a bit of a problem because while we made a higher high, less than one full point. if we went back to unchanged or negative territory, the bears would say you have a two-day double top going here and that would kind of put it on things. >> yeah, i guess what i feel here is that stocks are going up because other things are cooperating. you know, yields are down. oil is up. that helps energy stocks. the dollar, a little -- all of these things are constructive for equities but what you really aren't -- don't have here is the fundamental under pinning of a really accelerating economy or accelerating corporate profits. >> that's it. you have a bit of a profits recession, profit margins are beginning to contract and revert to mean and that can be a bit of

a problem. i think that's very well said that stocks are going up because other things are kind of encouraging to or allowing them to. i'd love to see some volume. i'd like to see a breakout to the upside with real stampede volume. so far it's indifference. we're strolling towards new heights. >> thank you so much. art carbon of ubs. michelle. amazon shares are sitting near record making a big bet on india. here is jeff bazos in washington. >> amazon will invest an additional 3 billion on top of $2 billion in 2014 to bring the investment to over 5 billion u.s. dollars. >> bazos making comments in front of indian prime minister. modi in washington today addressing lawmakers on capitol hill.

let's get to seema mody. no relation. >> that's always a question i get on twitter. good to see you here from washington. india continues to garner the global spotlight due to the economic success as well as its passionate energetic leader that did address congress today. he's meeting members of the congress in recession. in his address, he did speak about the importance of strengthening trade with the united states and also specifically trade in the defense sector. listen in. >> india exercise with the united states more than we do with any other partner. have more from almost zero to $10 billion in less than a decade. >> reporter: now, outside of defense for the investor community, the attention remains

on india's technology battle ground. now india has over 1 billion people, half of which are under the age of 25 and as china tackles the ageing population, the attention remains on india's young tech vibrant population that is embracing new products that's one of the reasons waer s -- we're seeing u.s. multi nationals prioritizing. you heard jeff bazos last night as cnbc attended the expansion there and tim cook of apple visiting tries to find ways to gain market share in india. guys? >> got it seema, thanks so much. let's bring in rob lutz, founder of wealth management and managing partner of asset management and "fast money" contributor. i understand why companies want to go there. seema talked about it. a very young population and

promises that that country is going to move more toward a market economy. amazon i get it. facebook i get it. what about the investor as an individual investing in the indian market, would you do it now? >> certainly yes. i think over the last year or two there's been a lot of head winds. currency a big negative in the emerging markets but yeah, mentioned the young there is really growing, emerging middle class and we see great growth potential in the future. very few people realize it but india out performs the s&p 500 dramatically over the last 30 years outperformed by 60% and over the last 15 and 10 years it outperformed by more than double. now it's under performed it the last five years so i think it's an ideal time to get involved. >> does it out perform it -- is that based on if i'm a dollar investor or a rupee investor

because you have to worry about the currency. >> michelle, i invested the first time in india and bought shares in hdfc bank. we have an 18% annual rate of return there. that's after depreciation on the currency of 11.5 to 2%. that will occur again. that's my top pick over there. but i think you can buy the financial services sector generally and most of the consumer sectors have a lot of upside over there and i think a lot of people think india and say poverty and pollution and that's the trouble. you got to look by that and look for really good growing opportunities. >> modi brought a lot of hope to india and investors in india. is that market, how is it priced in terms of valuation? >> it is not cheap. clearly, it's almost priced to perfection for what china is not. china is ridiculously cheap. where would you rather be. demographics and currency sold

off in line is actually cheap relative to itself. you understand we're in a world where inflation in india really hasn't structurally been this low ever. if there is one country in the world that benefits most it's arguably india. they are growing industrial and growing the oil demand. people talk about lack of demand out of em. india is particularly growing. rob is talking about the banking sector. the great thing about the entire investment horizon in india is it's a diversified cap. he talked about iciic bank. you hear u.s. industrials and clearly, india has replaced china and i think that's a story is only getting better. we've heard apple talk about it and ge and laquid. >> brian? >> michelle, low interest rates continue to drive housing and the refinance market.

mortgage applications jumped 9.3% last week. applications to refinance were a big part up 7% in the same period and if you're wondering what other buyers are paying. the average 30-year non-jumbo mortgage came in at a rate of 3.83%. here now to talk more about the state of housing and the real estate market is ryan o'hara. thanks for joining us. >> thanks for having me, brian. >> all real estate is local but if you had to generalize the country, ten being red hot, one being completely weak, how would the american real estate market come interest you right now? >> i would give it a solid eight. i think right now we're -- >> that good? >> i do. i think we're in a good market. i think supply is a little light and we wish there was more but i think the demand side is healthy and i think low mortgage rates you mentioned really helped. if you look at the end of '15, we were at about 4.1% and now 3.83%. and i think people are seeing that rates are good. they are seeing they will

continue to be and i think it's a good time to put money into residential real estate. >> every time that we see a bad housing number, you know, all the bears come out and say see, real estate is dying. i'm lucky to have a few members of my family and friends in real estate but to your point, i don't have a lot of sellers. are we seeing people finally put homes back on the market? >> there is a couple things, one is new homes coming into the marketplace. it is coming back -- >> not new by built homes -- >> newly homes. >> new by built homes. >> you're seeing distressed homes, that market is dissipated. you're seeing more supply coming from homes that were formally depressed but there is more supply. there is more demand than supply right now. ocho oc on our site we have 1.7 million and last time this year we had 1.77 million for sale. the days on market have been shrinking.

so you're seeing people make moves more quickly and making product come off the market. one of the reasons that happens is people go to sites like realtor.com and learn more. >> 1.7 million, i don't know what that means basically. i know what it means but how could that compare to five years ago or ten years ago? >> statics is last year 5.9 million homes exchanged hands, both new stock and existing stock and this year we're predicting about six or 6.1 million homes will move hands. there is more homes fridaying but the supply is out masking that in certain markets. >> we have a segment coming up later about automation. okay? automation is a huge deal. your website, everyone is on it and a mobile app. are realtors be automated out of a job? >> definitely not. if you look at the average american, the biggest purchase of their life is buying a home where most of the net worth will be and matters. if you get that wrong, it's a

big issue. it's a sophisticated process. it's complicated. that person human touch is critical. you don't want to make any mistakes. i think a realtor representing a client on the buy or sale side is critical. >> do you think that 5 or 6% commission model will hold up. do you think it will continue to hold up? >> i do. i think that people need a great realtor to help them through the process and if you don't, you really run a lot of risk. >> ryan, pleasure. still ahead, restoration hardware shares clobbered this year down over 50% but up next, one analysts says the stock is a buy. he will make that case ahead and later on, hanging up, new data showing that we might have reached, let's call it peak smart phone power lunch we'll be right back. ♪ ♪

can an established bank move like a start-up? it's a question we get from some of our largest banking clients. the face of their business was tellers. then atm's. today it's their mobile app running on the ibm cloud. across every transaction, the hybrid cloud helps their data move quickly and securely. our clients are building out features and pushing updates faster, on five continents. with the ibm cloud, they can move at the speed of any start-up. premium like clockwork. month after month. year after year. then one night, you hydroplane into a ditch. yeah... surprise... your insurance company tells you to pay up again. why pay for insurance if you have to pay even more for using it? if you have liberty mutual deductible fund™,

you could pay no deductible at all. sign up to immediately lower your deductible by $100. and keep lowering it $100 annually, until it's gone. then continue to earn that $100 every year. there's no limit to how much you can earn and this savings applies to every vehicle on your policy. call to learn more. switch to liberty mutual and you could save up to $509. call liberty mutual for a free quote today at see car insurance in a whole new light. liberty mutual insurance.

welcome back to "power lunch." restoration hardware keeping earnings. the stock has been crushed down 55% but we found an analyst that says this stock is a strong buy. the managing director at raymond james. bud, great to have you with us. >> thank you, melissa. >> this is going to be very anticipated because at one point, they said that market turmoil causedrders to actually slow and we're off of february lows quite dramatically so one would think maybe there is a pickup in order. an expectation of some good news from rh. >> well, we are looking for about 5 cents a share, which i think is in line with the consensus and comparable brand revenues up 5%, which is modestly i think probably below the consensus revenue. we're around $452 million in expected revenues. of what we think is that this is a broken stock but not a broken

business model. when the stock cracked really at the end of february, we took that opportunity to upgrade the shares. admittedly that's a few points higher than we are today but we really think the long term and intermediate term thesis for the name remains quite in tact. that is a real estate transformation that will have them adding large full line design galleries over the next five to seven years and i think that this company will gain market share and presence in the economy in the revenues look like they should double over that period of time. >> that sounds very exciting to expand and have larger showrooms, but they are having problems with the supply chain where one of the lines, rh modern, that was a problem last quarter that was one of the reasons they sited for the miss in the previous quarter. and one of your competitors, bbnt did channel checks saying they found 40% of items were in stock, only 40% for the rest of them, they were saying you know what customer? we're going to e-mail you to when those items will be in

stock. does it have a supply chain problem that could impair its reputation? >> that will continue to be the case until probably the august, september time frame. we've always known that. we have a very good friend who is one of their suppliers of rh modern case goods out of vietnam, a very fine factory if you will and we've been understanding that this has been an issue for some time. the good news is the incoming order rate was 21% in the fourth quarter, certainly better than the 11% overall growth rate and 9% comp showing the income order rate was fine. the issue will be how much cancellation they do experience from that issue. we've not expected them to get the supply chain really back in place until the august, september time frame and my latest channel check with that one supplier says that's really on track. so that's, i think, the other news is really old news and this news is really the right news

that they are going to get that on track by the end. the company is doing things to help expedite that for customers to try to maintain as much of those orders as they can. it will be somewhat expensive, which is in the numbers already for the balance of this year. >> bud, we'll see what the company says tonight. up next, why investors are loving refrigerators, post it notes and banana flavors extract. brian's favorite flavor. a few names entering the all-time high -- >> it has a certain appeal. >> when "power lunch" returns.

♪ using 60,000 points from my chase ink card i bought all the fruit... veggies... and herbs needed to create a pop-up pick-your-own juice bar in the middle of the city, so now everyone knows... we have some of the freshest juice in town. see what the power of points can do for your business. learn more at chase.com/ink

see great time for af points can shiny floor wax, no?. not if you just put the finishing touches on your latest masterpiece. timing's important. comcast business knows that. that's why you can schedule an installation at a time that works for you.

even late at night, or on the weekend, if that's what you need. because you have enough to worry about. i did not see that coming. don't deal with disruptions. get better internet installed on your schedule. comcast business. built for business. investors continue to love refrigerators, post it notes and yes, natural banana extract. we say that because companies that make those things, not all at one place are seeing stocks at all-time highs. illinois tool works make refrigerators. that stock hitting the highest level since the 1972 ipo. post it note maker 3 m, that stock hitting a new high and natural banana extract, apparently is the flavor of the month at international flavors and fragrances and that stock is also hitting a new record. well, from natural banana extract to yoga, kind of seems

like a good transition, right? we're talking lululemon and taking it to the yoga mat for missing on earnings. "power lunch" will be right back. ♪ go on and take the money and run ♪ . ♪ experience the thrill of the lexus gs f sport.

because the ultimate expression of power, is control. this is the pursuit of perfection.

welcome back to "power lunch." i'm michelle cabrera. lululemon reported a quarterly profit of 30 cents per share, one cent below estimates. last we can we had the founder of lululemon chip wilson on the show saying the company lots its way. >> vision is what is really missing, so if you see what lululemon is doing, they are rolling out stores but they are not morphing into anything new and they are not, they say they are doing -- they've got technology. they say they are doing invasion but i might be the number one person in the world to understand that and i don't see it anywhere. >> let's discuss with howard tuben. he has a buy rating on the stock and susan anderson has a sell. howard, why do you think the stock is higher considering they missed earnings estimates? >> they missed earnings by a penny but the most important point to look at is really what

happened to gross margin, what happened to same-store sales and inventory. it was issued for those guys last year but gross erosion is much better and inventory in line and sells up 8% without the use of promotion. generally a very, very healthy quarter. >> is that why you are positive in the stock because of the turn in those items? >> yeah, exactly. so when the current management team took over, they laid out a road map for reigniting the project engine and really played out. they had some issues with inventory and gross margin. they are in the rearview mirror. i think the stock is set to keep going up from here. >> stock is up 34% year to date. susan, you had to under perform for awhile. are you still there? why do you think it's going to go lower at this point? >> yeah, i think, you know, the gross margin looks to be stabilizing but the issues are really coming and net, net you have to look at the operating margin down 444 basis points

this quarter. they have lost operating margin for the past three years and looks like it will be down again this year in 2016. so, you know, management has said they will get back to the low operating level. i don't think that's possible and that's really what is driving the stock for the become half of the year. the management guidance is looking for 20% earnings growth in the become half of the year after a down 12% earnings gret and first quarter. so i'm just skeptical that inflection is going to happen and i really think this mid teens operating margin is the new norm for them. >> did you see -- not sure if you saw chip wilson's interview here. do you give credence to the complaints about the current management and do you think he could do a better job? that seems to be what he was pe subpar. i give credit to that part, but if you look at the women's pant wall they did this last fall rolled it out in the spring this year, it performed fairly well.

on the flip side, a lot of the performance has been driven by pricing. think raised prices 20%, you know, total sales really for the pants have been up in the mid teens or so so probably units are down. so really pricing is kind of what did drive the performance. >> that is amazing because those pants were already expensive. howard, there is concerns that apple has peaked and moving to flair pants and that lululemon is essentially a fashion company, not a workout company like nike or under armor. any concerns about that? are we looking at -- i remember my boyfriend in high school wore rebooks to the prom and sneaker haves never ever reachieved that peak from then. can we get there with lieu li lieu -- lululemon. >> these are guys that make technical performance-based athletic apparel.

they are not -- they are not fashion companies and they drive their business with performance attributes and technicality. a lot of cause well retailers globed on to -- >> tyler wants to jump on. >> i am moving to flair pants, by the way. >> you're wearing them now, rocking them i might add. >> i want to ask you how they are doing with men. i happen to have just bought a pair of abc pants, those are their anti ball crushing pants, i kid you not. [ laughter ] >> this is a family show, tyler. >> that's really tmi. >> that is the last time you will ever hear that on cnbc, ladies and gentlemen. i want to know what you think of their efforts with men. >> with men, okay. so their efforts with men have been great. their currency yield started at the beginning of 2014 and he said look, there is no reason why lululemon and can't be the men's business can't be strong.

so they relay started to put more focus on the men's business and feature it and come up with invasion and technicality. so they put emphasis on it and. >> it was just better they weren't. >> you know, we heard you. >> you heard me. you're sitting right here. >> stands for. i think -- >> now you know. >> susan you heard him when he said abc, right? >> i did. >> now they say we have to move on. >> susan, sorry, i want to know when you think about the anti b crushing pants. >> that's what pants are called. [ laughter ] >> do they work? >> anyway, let's move on, let's move on. check on the markets, kick off the second hour of power lunch. look across the board. we have green arrows but fractional moves up by a quarter of a percent commodities of

course a big story today, oil near the new highs for the year and take a look at the move in gold up by 1.4%. the weaker dollar, dixie and a big driver of the commodity trade. here is a question for you. have we reached a peak of smart phone growth. new estimates putting the global growth in smart phone sales at single digits for the first time. what does it sing until for the iphone 7 launch this year. walter has a buy rating in apple at btig and ed is a personal tech columnist with "usa today." great to have you with us. ed, it will start off with you. have we sold as many smart phones as humanly possible around the world or are smart phones less compelling and people less compelled buy them. >> people are less compelled to buy them. these are now mature products. there is not a ton of invasion. yeah, we get better cameras and that's great and faster and they add features, samsung has a

water resistant phone and that sort of thing but there is not a ton of invasion and people are perfectly salt f lly satisfied phones they had for a year or two. >> i heard time and time again, walter and looked at various surveys online what consumers really, really want in terms of smart phone invasion and most people simply say they want a longer battery and that just -- longer battery life. that doesn't seem to be in the offering here when these new phones come out. they come out with new devices and faster process sores but that's not really what people want. do you think, walter, the likes of apple are addressing what consumers want and bringing those people in. >> depends when you mean by smart phone because i think what we're talking about is a high-end smart phone. if you look at the world on a larger basis, a lot of people still don't have lte smart phones and some of these emerging markets and lte as we remember from years ago, such a new opportunity as far as enabling mobile video and broad band penetration is low. if we're talking about on a

global basis, this is plenty of reasons for people to upgrade. if we talk about the high-end smart phones, product is ageing. a large majority of the customers are on 5 or 5 ss in the case of apple. maybe that replacement cycle ex end the extended. december quarter more dramatic than march. it will get worse in june and september. if you talk to the wireless operators, they are seeing upgrade rates pull in. in the united states you see a lot of buy one, get one free offers. this could be just something operators do but it's also possible venn tors are going to operators saying look, offer an extra phone and we'll give you extra discounts to simulate upgrades. >> if i'm interpreting what walter is saying correctly, sounds like the great out there is happening in emerging markets on the lower-end phone.

what does that mean for growth for certain manufacturers? for a company like apple, this could mean giving up on the average selling price. giving up on margin to attack those emerging markets. who do you think would really stand to have an offering that could benefit from where the growth is around the world? >> i certainly know apple is looking to places like india, certainly, as one of those markets and it's interesting what you said. the last big phone by apple was actually going small. they came out with the smaller iphone. not a ton of invasion. same phone. smaller form factor. clearly, they are looking at different approaches to this. so there are markets out there but in terms of this, you know, this country. >> right. >> we're waiting for the next big thing. >> sure. >> a lot of companies are playing around with modular approaches to this. you mentioned battery. why not sort of stick on a battery? i don't know if that approach will work. tomorrow we'll hear from lenovo

and expected to come out with project tan go phone. that's a google initiative. we're seeing things happen but nothing dramatic. >> whoever comes up with the better keyboard. that's the next thing. >> that's also -- >> i mean, besides the battery, the keyboard. i -- it's got to get better. i can't have this many typos. >> walter, last word to you here. when you look at the numbers from gardener, they are staggering. 7% in 2016 for 1.5 billion units and that is down by about half from the growth that we saw in 2015. does this cause you at all to take a look at your estimates for apple and say you know what? maybe the growth isn't as robust as i think? >> 2014 was a crazy year because of this demand for apple for the larger format phone. if gardener is telling us that this market is even giving low single digit growth and apple is a stack you want to own under $100. >> so it can go from 7%,

projecting for 2016 low single digit and your thesis is in tact? >> absolutely. the phones will decline and have to cut asps which takes martins down, as well. low single digits is i think everyone is fine with that and buys the company time to develop products that everyone speculating on right now. >> okay, guys, thank you. btig at vague of "usa today." >> you know, michelle, before you get to the next segment, i want to say blackberry sent me a tester of new smart phone, and it's -- it's kind of cool. you slide it up and it's got the physical keyboard, it's got the digital keyboard and physical, not promoting the phone. i'm saying i've used it. the other cool thing is the battery lasts about three days, which in this day is a year. >> an eternity. yeah. >> it's got a physical keyboard. can you guess the name of the only stock in the s&p 500 to

have more than doubled over the past year? ♪ ♪ >> all right. it is chip maker invidia and up more than 40%. you can thank vir -- virtual reality. ian, you made a great call on the name. but you're still very bullish. how can you be just as bullish after a double in 12 months? >> thank you very much, brian. we think exposure to graphics chips is one of the best conductors and two parts of story. a very strong core gaming market where there is new users getting polled in buying more expensive cards and the second part like you eluded to, this universe of new applications and graphics right now and gpus,ual reality

things like aton mounous drivin >> i'll date myself. i still think of nvidia as i want to make the video game on my computer look better and the graphics move faster. i think of them as a video game . how much will be virtual reality, atonnous cars, not the graphics processer we think about. >> gaming is 6 0% of sales and call initiatives are 40%. i would say they are growing tremendously going forward. what is happening, new applications i talked about gpus are really ideal for implementing these applications and the existing processing like things for pcs and smart phones, they are not as ideal for inchmeinc implementing acceleration and artificial intelligence and things like that. >> listen, you're still bullish

on a name the best performer in the year, ian, but i'm sure to the bottom of research you have to put the risks. what t what is the single biggest risk to the price and stock of the core business? >> a very high bar in execution that trades our price targets based on 30 times earnings plus cash. they have a new launch coming out this architecture cards out for ten days and the jury is out how successful that will be. right now there is limited availability of the new gpu cards and priced at a premium right now. >> ian mkm partners looking at the best performer. ian, thank you very much. appreciate it. shares of alphabet are struggling down almost 5% today the tech giant is hosting the annual meeting with sharehold s shareholders. josh lipton live with the headlines from the meeting, josh? >> michelle, that meeting just wrapping up. the vote itself went according

to plan. the 1 1 members were elected an six shareholders denied. alphabet stock as you mentioned michelle in the red this year, so is it under valued? cfo was asked that very question. she said she doesn't focus on the stock price, just on doing in her words the right things, meaning focus on the big ideas and making the bold decisions google is well-known for. what was interesting, though, is what was not discussed today. shareholders did not ask erik smith one question. following very critical media reports. schmidt mentioned it as one of the businesses he's excited about with google fiber, breakthroughs in modern medicine and self-driving cars. back to you. >> got it. thanks for the update. here is on the menu for the rest of "power lunch." we'll talk to a ceo that's big

on cancer treatment. oil moving to new highs for the year. the one factor impacting the oil market right now and eyes of the robot. are they coming for you and your job? we'll debate how worried you should be. all that and much more coming up on "power lunch." they found out who's been hacking into our network.

who? guess. i don't know, some kids in a basement? you watch too many movies. who? a small business in china. a business? they work nine to five. they take lunch hours. like a job? like a job. we tracked them. how did we do that?

we have some new guys defending our network. new guys? well, they're not that new. they've been defending things for a long time. [ digital typewriting ] it's not just security. it's defense. bae systems. igoing to clean betteran electthan a manual. was he said sure...but don't get just any one. get one inspired by dentists, with a round brush head. go pro with oral-b. oral-b's rounded brush head cups your teeth to break up plaque and rotates to sweep it away. and oral-b delivers a clinically proven superior clean versus sonicare diamondclean. my mouth feels super clean! oral-b. know you're getting a superior clean. i'm never going back to a manual brush. welcome back, everybody, to "power lunch." i'm tyler mathisen. the country will auction off 3,000 patents it hopes they will

bring in $1 billion. shares of jacobs engineering higher today. the company won the main contract to build a $5 billion copper and gold mine in mongolia. verifone down that will likely mean job cuts there. they make payment technology and trades under the ticker symbol pay down $6 today. melissa? >> ty, the top leaders with jeffrey's health care conference in new york. shares jumping more than 10% in hopes for the cancer immuno therapy. great to have you with us. >> thank you. >> a number of companies with so-call so-called immuno therapy treatments. can you tell us how your specific technology works and how it's different from ones that are also being tested

because your stock is a whole, they tend to move in a pact when you take a look at kite and juno and bluebird. >> well, immunotherapy is generating a lot of excitement. the conference here in jeffreys where we are now and there are multiple companies developing i therapies, cell therapy. it's the ultimate personalized cancer therapy by which you take cells outside the body, you reeducate them for a week in the laboratory, you reenergize and redirect them to go back to the patients and then find cancer cells but sparing normal tissue. this is generating dramatic responses, which we reported in this conference. >> right now you've got clinical

trials going on in aggressive in treatmenting aggressive non-hog ki kins lymphoma. in mid to late july, i believe, can you give us an update when you expect the next sort of data point to be out there for phase two? >> we are currently in the final stages of what's called pivotal registration study that will be submitted to the fda with the hopeful approval in 2017. which is next year. so this is the registration and we hope to compete the clinical trials in -- within the next several months. >> within the next several months and so it's essentially in layperson's term, ari, that means you're requesting fast track approval because this is for a treatment so devastating this is one of the few possible treatments out there that could

actually make a difference in the diagnosis. >> that's correct. our patients are those who failed all possible therapy, fail chemotherapy, some of them fail bone marrow transplants so they do not have any other options available. we have already received from the fda what's called breakthrough therapy, which is an expedited review. actually last week we have notified to the market for the first time what's called prime. it's a break from therapy in europe. we are the first company in the cancer arena that received that designation in the european union. >> you already started ramping up for possible production of this, mass production, your goal 4,000 to 5,000 personalized patient therapies annually. it sounds like you're ready for all engines go once the fda says

yes, you're approved. are you preparing for a 2017 approval? is that your best case scenario? >> yeah, we do. we have these manufacturing plans ready to go. the final inspection by the fda would come early in the year but we are producing currently from our clinical manufacturing site over 40 centers for 40 centers around the country. so all of these centers are currently participating in some of the trials that are on going. we have trials in li, the engineering of the immune system will take us to many other tumors not only in the blood cancers but also to many types of solid cancers. >> doctor, thank you for joining us. appreciate it.

ceo of kite pharmaceuticals. >> thank you, melissa. shares soaring this week on rumors of a takeover. will a deal happen? see what the analysts are saying and four other stocks to watch, as well. that's all next in "street talk." what are you doing right now?

making a cake! ayla reminds me of like a master chef and emiana reminds me of like a monster chef. uh oh. i don't see cake, i just see mess. it's like awful. it feels like i am not actually cleaning it up what's that make mommy do? (doorbell) what's that? swiffer wetjet. so much stuff coming up. this is amazing woah. wow. now i feel more like making a mess is part of growing up. stop cleaning. start swiffering. it takesbut stealing itd work to eaonly took a few days.

female announcer: protect your money. find out if you're dealing with a registered investment professional at investor.gov. before you invest, investor.gov. images, videos, social updates. we call it dark data. 80% is invisible to most businesses. the ibm cloud has tools that can help see dark data and put it to work. hello, my name is watson. working with watson in the ibm cloud, we can help an energy company predict pipeline corrosion. and help a start-up to use social data to predict market trends. now businesses can get more out of their data. that's what the ibm cloud is built for.

it is that time, time for "street talk." first up is a hot name, lending club. >> i know. >> yeah, wow, i know exactly. down again today. the stock now down over 50% in the past 90 days but we're starting to see some analysts defense on the stock. btig's mark palmer out last night after the bell reiterating a buy and $9 target. he believes, melissa, core value after 9% credit card and 12% loan remains in tact and adds that persistently low rates meets the offer by lending club's loans is more stabilizing and appetizing to the investor base. uncertainty around the progress that acting ceos making should persist. woods also upgrading from an under perform to a market perform. some defensive lending club coming up. >> i mean, that's 100% increase.

that's a double. we'll see. next up -- >> not mine. >> well, yeah, that's what you chose. ak steel very bullish callout. out of credit and upgrading ak steel two notches to out perform to under perform and increasing price targets across the sector. new is supply demand model indicates continued deficits for a value add the third quarter supporting prices are well above fair value right now. significantly increased its spot and contract prices. take a look at that 18%. >> listen, flat rolled, hot rolled, whatever you want to call it it's been a hot market. the steel market is actually -- >> look at the commodities bull run. >> doing well. stock number three, a commodity name. vulcan materials. g g goldman sachs removes but a positive call. they boosted the target to 146 from 128. that's 23% upside from here.

the analyst says the market for road materials is consolidating and driving price gains. the analyst remains positive on the public construction cycle and thinks it will be supported going forward. i.e. we need to fix infrastructure and the buy rating at $131. gold man taking it off because they want to put something better on but it is a positive call. >> better on than -- >> because it's been hot, i think it's already met -- there was a good call sort of met the goals but still like the name. next up, mkm is addressing the reuterss report that f 5 obtained a bank to evaluate and says it does make sense that five would look into selling itself and there could be strategy and private equity and increasing a 12-month fair value estimate to 118 and takeout price at $130 a share. chances of takeout according to mkm 50%. >> been one of those companies

that have been around forever. still don't exactly understand what they do. >> networking. >> just throwing it out there. you can't say networking. >> that's a scam. stuff, sell stuff. today's under the radar stock of the day is dover corp. they built the capital of delaware. not true. upgrading the stock to out perform. >> don't lie to america. >> the target boosted by 20 a share to $86. of course, the stock was above the previous target of 66. that is nearly 20% more upside. the stock already up 16% year to date. it's an oil call about 20% of dover's revenue are from energy and thinks online drilling may have bottomed and like dover's discounted valuation. >> delaware. >> dover is a great, one of four cities whose capital city through the others. honolulu, oklahoma city and indianapolis. boom. you're welcome.

oil rising -- i'm just insane. oil rising to the highest levels of the year today. supply disruptions in nigeria part of the reason. that country is growing impact of the oil markets and that coming ahead plus the final trades on oil when "power lunch" returns. 3w4r5 p ♪ using 60,000 points from my chase ink card i bought all the framework... wire... and plants needed to give my shop... a face... no one will forget. see what the power of points can do for your business. learn more at chase.com/ink

. shared ideas into practical operation. there can go no doubt in advancing this relationship, both nations spend to gain. >> israel's prime minister thanking russia for handing over an israeli tank captured by syrian forces in the 1982 war in lebanon. benjamin netanyahu was presented

the tank during the visit to moscow. the crew of three remains missing. the french government created an emergency alert app to send wantings to smart phone users in the event of a bombing or shooting. it's being released ahead of the football tournament starting on friday. and it was a flash mob. 370 trombone players gathering at lincoln center in new york city to perform under the direction of joseph alessi. they are attempting to set a world record for the largest trombone ensemble. and it was raining, too. that's dedication. that's the c nbc news update. back to you. let's blow the horn on the final oil trades. the price of crude oil up 1.6% the highest close the fact that i basically live in oil now, i know this.

we'll call it one of the highest. one of the drivers of oil's 2016 highs is the decreased output from nigeria. sabotage of oil supplies, infrastructure, you name it have driven production in what was formally africa's largest oil produce tor to a 20-year low. former u.s. ambassador from 2008 to 2010. joining us, as well. let's start with you. much has been made about the violence and here is the difference is that nigeria had oil-related violence for a long time but in the past it seems they want to shake down the oil business, right? give us money, or we'll do bad things to you. now it seems a new group, the avengers wants to do damage. is that how you read it? >> there are two things going on. this is a different nigeria, delta militant group 2.0 if down want to call the e avengers and

their goals are different. they want a separate nigeria delta region, which is very, very different from the militants of the mid 2000s in the region and they are attacking oil pipelines as well as oil infrastructure and demanding really something completely different than the earlier militant group. >> yeah, does that ambassador make you nervous or do you feel like there might be other solution to the problem, if they don't want money and just want damage, how do you stop that? >> well, there are two things. one is not a question of them just wanting damage. they are basically saying none of the benefits from the oil revenues are really helping the development, social development and educational development of the region and they believe that having a separate region would address that better. there are two things going on. you have this idea if you have a separate region than more resources will go to social structure, social reform and benefits than what's happening now with services the oil sector

through the previous militant group. >> but isn't this the downward spiral and, you know, they promise jobs, the jobs aren't there in part because the economy is weak. the economy is weak in part because oil output, not just from the avengers has slowed down because the infrastructure is poor. if the avengers cause these problems and oil output jobs, how can they then do the things the avengers want? how does this vicious cycle ambassador end? >> there is two ways to address this. one is to separate a little bit of the things that you put there together. you know, the oil input, output right now is about 1.6 million barrels a day. they were striving for 2.2. the idea is to get that back up. if they are able to protect the infrastructure from being damaged, they can try to do that. that's a separate issue.

then on top of that, you're right. the overall economy is in a very dire situation. not only has the low price of oil hit them, their reserves are down to about 27 million but they have high unemployment. they have a challenge with the currency, rather the currency will be devalued or not. so all of these things are coupled together. it's not just one single thing. all of these things are coupled together. really making it a very, very difficult environment, economic environment for nigeria at the moment. >> former ambassador to nigeria robin sanders. pleasure to have you on "power lunch" thank you. let's talk the broader picture and international markets affected by nigeria. joined from plat an l. the supply has come off. is that why oil is higher or other reasons? >> that's part of the picture. we had disruptions in venezuela, also. we're losing with natural declines from other regions in the world, however, with this

new high that we're printing right now, we fully expect the u.s. producer to step right back in and start bringing it back on. so -- >> that was my next question. >> we'll bring a balance back, i think. >> commodities always do this, price, draw, supply forward. we got to below $9 million of production per day here in the united states. you say this price is going to bring on new production. how much and how soon? >> so one of the things that i think is going to startle a lot of people in the past six months of this year in the low price environment, a lot of producers continue to drill but didn't complete the wells. so they are basically sitting in inventory creating spare capacity and in texas alone, theoretically we could bring on close to 1 million barrels a day relatively quickly if we were to bring on the wells just sitting in the basins. >> a week, a month, six months? >> depending how quickly you can get crews back out. if we were on peak, it would be a 30-day turn around.

it could be 60, 90 days but the point is we got wells sitting in inventory that have been drilled just waiting to complete, and when i do the back of the mat envelope, that's close to 950,000 barrel as day in the permian and eagle ford. >> where does it go from there? >> i think what you'll turn into here is a shorter commodity cycle. sitting here with sunk costs and inventory will work through them and resultingly we're probably going to come back at a balance quickly because i also imagine at $51 a barrel, the rest of the globe will ramp up production as much as they can. >> that sounds like prices will come down over six months. >> yeah, you'll get back out of balance again. you're probably close globally potentially to a balance but the minute we ramp up production, we'll not do it alone. opec will do it with us. we have a huge over hang in

inventory and refine product inventory does not budge. we'll ramp up production and run it through refiners and solve the parols back in the ground to something else. >> interesting. all right. suzanne, thanks for joining us. >> great, thank you so much. platt an l platt. robots are coming for your job. in many cases they may be here. the question is, what are we going to do about it? we're going to have a big automation versus you debate coming up.

thank you. ordering chinese food is a very predictable experience. i order b14. i get14. no surprises. buying business internet, on the other hand, can be a roller coaster white knuckle thrill ride. you're promised one speed. but do you consistently get it? you do with comcast business. it's reliable. just like kung pao fish. thank you, ping. reliably fast internet starts at $59.95 a month. comcast business. built for business. experience the thrill of the lexus is f sport. because the ultimate expression of power, is control. this is the pursuit of perfection.

ian posted thoughts about the devastating effect technology is having and will have on jobs, jimmy economic

policy analyst for the american enterprise institute, cnbc contributor joins us, as well. he has a somewhat less dire case. brian, go ahead, take it away. >> i'm a guest, that's it? >> you're a guest. >> that's the softball you throw me, tyler. i love you. listen, i'm not a doomsayer, not a singularity guy, i'm not -- you know, jimmy, you know, you can go into this, this is not like the black smith taking the job, you know, and going to the ford automation plant because the car took the job of the horse. when i look out and read some of the stuff i'm reading in the oecd estimates about automated out of work, it's scary and i just don't know what we're doing about it and when i look at the political environment, i see the political environment, anger on both sides only increasing with automation, right or wrong? >> the real point to me is not whether this is going to happen, whether automation is going to take jobs or not. but how many, how fast, and

whether new jobs will take their place. >> right. >> you know, when you make a forecast, use a number and a date but not both. so yes, i'm quite sure they will take some percentage of jobs. the report you're referring to is 9%, but that's a static number. all right? it doesn't look at how many jobs will technology create. will the people who lose those jobs, will they be able to do something else, increase their skills? will a higher productivity create more demand? a great example is what happened with bank tellers. when atms came in, banks maybe all the tellers will disappear. that hasn't happened over the past 20, 30 years. we have more bank tellers. fewer bank tellers per branch, banks have more branchs, therefore more bank tellers. not always simple to say gee, the robot is going to take the job. >> i don't think the robots, jimmy, will take all the jobs, i want to be clear.

this report referenced in a new york times article that i sited, as well, they think 9% of the u.s. jobs could be automated away. 9%. >> that's a lot of jobs. >> that's 13 million jobs. let's say they are wrong, jimmy, by half. we'll call it 6.5 million. add that to the current unemployment number. that's great recession number unemployment. how do you solve for that? >> again, that report actually in the report makes my exact point that that's a static analysis and doesn't assume technology will create jobs. what you want to do here, try not to make a forecast but what are you doing now? is the right thing to do -- we are going to freak out, we will have mass unemployment and need to start cutting checks or do things like one, worry about education, worry about occupation licensing regulations. worry about housing regulations which prevent people from living in high productivity cities. do we need more subsides. something you like brian infrastructure spending.

those are the better ways of dealing with that right now versus like something like a basic income and listen, you could be right in 25, 30 years we'll have mass technology unemployment but that's not the case. >> there will always be real estate agents, however, as we asked and learned. >> i'm not arguing for universal basic income, we might need it or not. don't know. my point is the political environment, jimmy and i might agree on this. when you look at sanders and trump and clinton to a point, it's getting into people's fear, job loss and wage stagnation and inflated out or exports out of the work force. it's also a reason why we're probably seeing disability roles go to 14 million. not because these people are lazy but don't have another option for income because their job is gone. >> what's the biggest risk going forward? is it trade. trade with china raising wages are rising? or is it automation? if you can make a bogeyman,

automation seems a little -- >> are things different now things are different now that, we have women switching telephones, every person in the united states would have to switch for all the phones, all the phone calls we make. there is automation continuously ever since the va neegsruled -- >> you could that productivity. the tenure of the conversation would be completely different as opposed to -- >> first off we have no productivity growth in america. you can't worry about both. you can't worry about robots and no productivity growth. something has to give. both situations don't align. >> that's not true because one of the incomes going to go to capital, one is going to go to labor. i don't want to throw out picketing or whatever but there is no productivity growth and everybody is trying to figure out why not and i'm thinking do we have to look at technology as

a reason why we're not seeing productivity growth. if we have 100 million more kay m americans than 1979 -- >> we have 100 million more americans and look at the unemployment rate. it's pretty low. 10, 20, 30 years because robots are thinking. they never thought before. >> if we have a future where advanced artificial intelligence, robots who can do anything, by definition, you're talking about a higher productivity society and at that point, if you're really worried about large scale technology unemployment, then you're right. it decomes a redistribution problem. that's not where we are. i would focus on making workers more productive, making machines more protective, the economy growing faster. i would worry about that fast. >> all right. gentlemen, thank you. everybody, thank you. for more on brian's thoughts on automation and basic income, head over to power lunch -- >> there is nothing on basic

income. >> new york times article, i was going into the fear, the idea that this does worry me. i hope like hell that i am wrong. >> there are people that say if you have that job displacement. >> wall street is going to implode. wall street banks will be half the size they are in ten years. >> wall street will -- >> enthusiasm. life insurance automobile insurance i spent 20 years active duty they still refer to me as "gunnery sergeant" when i call being a usaa member because of my service in the military to pass that on to my kids something that makes me happy my name is roger zapata and i'm a usaa member for life. usaa. we know what it means to serve. get an insurance quote and see why 92% of our members plan to stay for life.

uh, maybe we should call i.t. as long as you love me, it's alright bend me shape me, any way you want me... shape the best sleep of your life. sleep number beds with sleepiq technology adjust any way you want it. the bed that moves you. only at a sleep number store.

forbes has posted its list of highest paid athletes in the world. totally compensation most notable is golfer tiger woods who's taken the top spot 12 times. floyd mayweather was number one of the forbes list three of the past four years. oklahoma city's kevin durant, hoemten guy for mmetown guy for. he's going to get richer because he's a free agent right now. rogerer from has an injured back but that ain't hurting him in the pocketbook. 60 million in endorsements. 67.8 million total. number 4 on the list would be lebron james. 23 million salary.

endorsements 54 million. that is your top american easterner. number 2, lionel messy. but look here. messi. but these guys make more from salary and endorsements. 28 million in endorsements there. number one, real madrid's cristiano ronaldo. 56 million in salary. 32 million in endorsements. $88 million. highest paid female athletes. serena williams. number two, maria sharapova. band for two years finish the use of illegal substance. >> ronaldo clearly also the best hair. >> good looking dude. >> trading nation now. the s&p 500 has surged 70% from

february louse. chesapeake energy which may thought might not be around is up 185%. free port up 143%. oneok 134%. and joining us now,'d d eddie. of course they are the best they went down to almost nothing. if you are a dollar and it goes to two it is a double. have you been a buy entire the rall -- into that rally? >> translator: at all. chesapeake energy is up a huge% but remember it's gone from being down 98%. now it is only down a scant 93%. here is what it is. with these companies, is their commodity-related stocks. and they really got that bounce that began around mid february. and they have ridden that bounce

from extreme oversold levels. so right now they are basically very big bets on the future of commodity prices. with that there are much better places to go. xle or xlb or go with names like dupont or exxon. but i'd stay away from these huge winners since february. >> not necessarily maybe dead cat bounce but would say severely wounded feline bounce there. some were very close to the end there. were you buyers for these, fortrading money just for fun or do you really believe these companies are going to be back? >> i don't know if they are going to be back but i remember when chee when chesapeake was on a stretcher a couple of months ago when oil was on the 20 handle or on the 0s. as the bounce based on the commodity bounce. the key question is how do you view commodities right now.

we've had a little tain tail wind from the macro picture. china even last night had a good trade picture. and imports increased and suggest chinese production is starteding to come back up and should be positive for commodities. this whole commodity rally could have more legs going forward of the three the 1 k looks the best and has the strongest foundation. so so i think if you pick one, that's the one i go for. >> thank you both very much. trading nation cnbc.com. power lunch back this two minutes. >> and now the latest from trading nation dot cnbc.com and our sponsors.

income inequality a big topic this presidential election. checkout hooints new york primary speech in april. inequality was one of the topics she spoke about. so why are we spoeing you this video? zone in on the jacket? $12,000 for that armani tweed jacket according to sports. that's nice. but speaking of income

inequality. >> motorspor s mo mores there an the screen. >> lot of talk in the election cycle at the 1% but really about the .01% pulling away and gaining the most wealth. a new report from boston consulting group find their 1 .1 million new millionaires bringing the total to 18.5 million. about 1% of the american's households. the growth was flat. and asia with 17% growth but the big winners in the next five years will be the super rich. cho w.h.o. are leaving the merely rich behind. they will see weather grow 9.5% a year by 2020. faster than single digit millionaires and more than twice as fast as non million millionaires. in the u.s. the 20 million plus crowd will control 29% of totally wealth in 2020. but millionaires will see their share remain flat and non

millionaires are going to see their share drop as well. billionaire wealth now about 15%. so it is really not the 1%. it is the very top of the top just like those sports stars. just like those sports guys just talking about. >> "closing bell" starts now. ♪ hi everybody. welcome to the "closing bell." i'm kelly evans of the new york stock exchange. >> and i'm bill griffith. stocks not doing a whole lot but oil hitting highest level in nearly a year today. we found someone who feels these higher prices are just a head take that we are desk nd to go lower before the end of the year. >> and the ath athleisure phenomenon is still going on. and lulu