newsworthy. >> certainly in the cross hairs of the president-elect. >> ford announcing it's bringing back the bronco. you wonder if that's a long-term projection on gas prices. >> "power lunch" is done. >> "closing bell" starts right now. hi, everybody. welcome to the "closing bell." i'm kelly evans at the new york stock exchange. >> which makes me bill griffeth. move over dow 20,000. the nags dak taking center stage. the tech heavy index hitting a record high as it did on friday. we'll tell you what's behind that move coming up here. and president-elect trump meeting with business leaders. we have his discussions with the founder of alibaba and ldmh. >> we have the heads of bb&t, we

have merck and ibm. i don't know how we're going to fit this all in. >> buckle your seat belts. >> we'll find a way. let's start with the nasdaq on pace for another record closing high. we have bertha coombs on site. hey, bertha. >> hey, bill. 2017 has been very, very good for the nasdaq. on pace for a fifth straight day of gains and yet another record high. it all started with the big caps. nasdaq 100 at a record high today. to close above 5,007 makes it a new record. apple also a two-year high. that's part of the reason that you've got the nasdaq 100 so fired up. apple on pace to close here at the highest since november 2015 on the tenth anniversary of the introduction of the iphone. that is spreading over to chip stocks. chips very strong. you have nvidia moving higher. skyworks is part of the apple iphone. biotech has really been the

story here so far this year. biotech is up 7% over the last five days. close up every single day so far this year. some of it today on news coming out of jpmorgan, a trial drugstory from incyte. aria pharmaceutical having been taken over and acquired by cada. also you have vca. it's being taken over by marv. and being taken over by united health. a lot of m&a and ibb finally out of correction as of today. back to you. >> all right. we're going to show some home movies. >> you got to see snow goose this weekend. >> oh, boy. >> big weekend. >> can't wait to hear how that went. so are the markets getting too far ahead of the anticipated

trump policies. larry kudlow our senior contributor and informal economic advisor to mr. trump. he explained his concerns about the market getting ahead of itself last friday. let's listen again. >> is the market getting ahead of itself? on the matter of tax laws and tax legislation and pro growth supplies, i worry about that. because we may not know until the very back end of this year what the rates are, who's going to pay the rates, will there be grandfathering, will it be, you know, retroactive to some day? there's a lot of things out there that are going to have to be resolved. by the way, a quickie, that's why i wanted to put the bisz uss tax reform piece into the first reconciliation bill. >> so what will happen to the market rally? joining our closing bell exchange we have steve quirk from t.d. ameritrade, scott ren

from wells fargo investment and our own rick santole from the cme. sarge, we haven't seen you since the dow got oh, so close to 20,000 and has backed off. do you think this sense that maybe it's not happening quickly enough that larry was referring to is part of the reason why when it comes to trump's plans? >> i think it will get there. i think it will hit 20 thaurks -- 20,000 on the dow. i do think this is positive. there is a little bit of a hurdle here. i think treasuries may be setting up for some kind of short squeeze. that's the way they're moving. they're not moving with utilities and they're not moving with telecom. but i do believe that we will probably see decent earnings from the banks this friday and beyond based on the way treasuries did move back in november and i think that's the space you still want to be going forward. >> steve quirk, one hallmark of this is if it isn't going up

it's going sideways. we haven't had much of a correction. what does that tell you about the nature of the market? what is it waiting for here, do you think? >> if you look at it, we released our imx, client behavior for the month of december. for the second month our clients have been dialing down their exposure on a small basis. they're just taking some of the positions off the table in some of the sectors and names that have appreciated. so i think there's a little bit of trepidation in advance of, as larry was pointing out, in advance of all of these policies being enacted. i think clients are taking a wait and see approach. >> scott, would you echo that? how do you see the market evolving here? >> well, you know, kelly, right now the market is trading within our year end 2016 target range and it's also trading within our year end 2017 target range. so, in other words, the market's at pretty much fair value based on what we're doing. we're not expecting a lot out of the s&p 500 in 2017.

i would argue we're at fair value. really this rally would have happened whether hillary clinton would have been elected or donald trump would have been elected. so for us this is all off the fundamentals. there's not a lot of trump anticipation built into this. we're going to have to wait and see and certainly 2017 will probably feature very little if any influence from any of the new administration's policies. >> scott, did i just hear you say this rally would have happened -- that this is not a trump rally, that this -- >> no. >> -- would have happened no matter who was elected president? >> scott, i'm going to disagree with you if you don't mind. >> let him confirm. >> that is what i said. the reason i say it, if hillary clinton would have been elected, it would have been, oh, thank god, status quo, we know what that's about. that's not what happened. so basically we're trading off fundamentals that are going to happen in 2017 which has very little to do with whoever the new president would have been

and who -- and being donald trump, you know, he's going to have very little influence on gdp, earnings, all of those sorts of things in 2017. >> i want you to disagree, sarge. i want to bring rick in. >> by all means. >> i'll tell you what, i'm with sarge on that. you know, it's -- >> i thought you might be. i knew rick would be. >> i think we can tie that in with larry's comment. listen, larry's a smart guy, supply seider's express, almost the same sentiment as larry. i would take both of these even though they're diametrically opposed underneath. we never really know what markets would have or could have done. we don't know exactly why they're moving. but i will tell you this, if only logical markets were allowed you would probably have to take half the record books and burn them in the fire box. i still say there's something on the confidence side of this that may transcend the fundamentals. but we don't know how long that can be and we don't know exactly

how the legislative process will eventually pan out. i think there's another way to interpret what many are saying like larry kudlow, sometimes when you're a businessman it's best to under promise and over deliver. >> sarge, everybody's getting maybe ahead of themselves according to larry on some of the policies here, but even if that's the case, you're still here to pound the table for the financials. you still think that is a long-term play in this market, yes? >> you see, we have the most business friendly president probably of all time. he's appointing probably the most business friendly cabinet of all time. he has a compliant legislature and possibly a hawkish fed at the same time. this is a one in ten year's event. i think you're going to have less regulation, lower taxes, we're probably going to have some growth. we're going to hit some hiccups. i promised you a violent january back in december. you have time to get nervous but i do believe you want to be in

financials at least the first half of 2017. if you get the fiscal spending it will hit in the second half. >> steve quirk, are you seeing flows? what are people betting on? >> we saw flows in the financials in advance of the election, quite a bit of flows into the financials in advance of the election. we're actually seeing some people dialing out of the financials now because they've had a nice runup. i'll echo what i said earlier. it's a bit of a wait and see game for a lot of our clients right now. i would say they are well positioned. they are looking for opportunities and the pull back sarge talked about would be an opportunity for them. >> guys, we have to go at this point. thank you all. appreciate your support on the "options action." andrea mitchell says hi, rick. shares of alibaba is getting a boost after jack mah saw president-elect trump. john harwood is here.

>> kelly, that's the second most important bit of news we've gotten out of trump tower this morning. the first of course is jared kushner, the president's son-in-law, is going to be named as a senior advisor to the president. you were talking in that market discussion about the uncertainty over what policy gets implemented. jared kushner is going to have as much influence as anybody in the entire trump administration on what those polling sis aicieg to be. real estate developer, married to ivanka trump. now he's been trying today to switch the focus back to economic issues, the president-elect has, and he started by taking credit for the fiat chrysler expansion, which is an economic development move that fiat chrysler started talking about a year ago. he also met, as you've mentioned, kelly, with jack mah of alibaba at trump tower. they talked about jack mah's desire to let american small

businesses sell on the alibaba site and that's a way that he says that he's going to create a million jobs in the united states. the president-elect met with bernard arneault of lbmh, the luxury goods retailer. they talked about a potential plant in north carolina. all of this comes as donald trump's cabinet nominees are going to move through and have hearings tomorrow. democrats are complaining that this process is going in advance of the ethics clearing vetting process for those nominees, but republicans have likely got the muscle to keep that process moving and you've got just a little over ten days until donald trump is the president of the united states. >> ticktock, ticktock. busy week. john harwood, in washington. to seema mody. >> energy moving lower. blackstone is reportedly no

longer in talks to buy a $5 billion stake in energy transfer partners. that according to bloomberg. this also follows that failed agreement between williams company and energy transfer partners. we are, again, looking at shares of energy transfer partners down about 2%. blackstone also lower on the day. kelly? >> seema, thank you. got about 45 minutes, little more to go into the close here. looking at the dow dropping 56 points today to hang on to about 19,900. that's a different level than we were just talking about on friday. the dollar is lower by a quarter of a point today. the s&p is lower by a quarter of a percent. the russell small caps are headed lower again. they're down more than half a percent. the nasdaq bucking the trend in record territory. >> you wonder what the catalyst will be to push us over dow 20,000. >> catalysts can come in lots of different types. >> probably black swan of some kind. we have some of the biggest names in corporate america heading your way.

bb&t ceo kelly king and eileen rometty will weigh in on bank regulations, drug prices and immigration. and a trump tweet thanking fiat chrysler for building jobs. former u.s. trade rep ron kirk will weigh in on the viability of trump's threatened border tax coming up. you're watching cnbc, first in business worldwide.

>> it's lower. analysts say they have the full take. you have it.

and trans ocean. our phil lebeau has the latest on these and other stories that must be ruling the detroit auto show. >> kelly, we're hearing a lot of people talking about donald trump and what the impact might be for the automakers. it's interesting that you mentioned those tweets in thank you to fiat chrysler for the announcement about investment here in the united states. we just talked with sergi sergio marchionne, the timing

with the announcement, this is with president-elect trump. here's sergio with the impact which was none the trump administration had. >> the thinking was in place beforehand. >> very clearly the thinking was in place beforehand. we want to show you this in terms of the number of vehicles exported to the united states from a number of automakers. general motors being the one that brings in the most autos from mexico. the reason we're pointing this out is because you look at toyota, which was also the subject of a trump tweet regarding the corolla, when we talked to the head of toyota america, is there a possibility you're going to scrap your plant the way ford scrapped its plant, he said, no way. here's a little bit more from him. >> it would be difficult for us to do because this is just one piece of the puzzle is we are realigning all of our north american footprint. so to do that would impact our

suv strategy and right now the market's red hot on suv. we've got to continue that strategy as well as additional pickup trucks as well. >> as you take a look at shares of toyota, keep in mind that almost every automaker at this show when we've had a chance to talk with them has said the same thing. you know what, we want to see if we can grow our investment in the united states. we want to see if we can add jobs. having said that, aside from the fiat chrysler announcement which, again, this was in the works but they decided to announce it yesterday, no other automaker looks prepared to make an announcement about adding jobs. let's see if that changes over the next couple of months if there are more tweets from president-elect donald trump. >> thank you, phil. i was looking at that tri-color bmw behind you. it's a good looking car. >> i know. those concept cars will tease you if that's what it is. >> it is. >> you'll never see the light of day. >> phil, thank you. >> very frustrating sometimes. >> you bet. >> our phil lebeau out at

detroit. president-elect trump's tweet is very different than last week. he went after toyota for planning to build corollas in mexico. he threatened, quote, a big border tax on goods manufactured overseas for the u.s. market. >> let's talk about that. the impact a border tax would. we welcome back mr. ron kirk. good to see you again. welcome back. >> good to be with you all. happy new year. >> is it possible just the threats of a border tax is enough to get companies to want to create jobs and increase manufacturing here? the automakers, soft bank with their promise of bringing jobs here to the united states. now alibaba wanting to help create jobs in the small business sector. what do you think of that at this point? >> well, listen, this -- the idea of growing our economy is not an old one, and it is one that every president in my lifetime has made a commitment

to. most obviously familiar with the efforts of president obama to incentize american businesses and i applaud president-elect trump for trying that. you heard from the ceos many of these plans were in the works. and the reality when we talk about a border tax, it just doesn't make good economic sense. and the one thing your listeners need to remember, any border tax, any tariff increase is a tax on the american consumer and in the case of automobiles, because i'm here in texas, you know, we have cars made by general motors right here in the metroplex that will go to mexico then come back to the u.s. because we had a fairly integrated manufacturing market for autos between the u.s. and mexico. >> yeah. >> so trying to discern what's made in mexico versus what's made in texas i think could be

an exercise in futility. and for a state like ours in which we do almost, you know, $200 billion a year in trade just between texas and mexico, and there's some 380,000 texans who owe their livelihoods to that. so i think we've got to walk very carefully here. >> there was an interesting -- i think it was marty feldstein writing in the wall street journal, this will be more favorable to corporate america and the government in general. the dollar will rise by the same amount as the price increase for consumers, that it won't be the consumer who bears the brunt of it. it's a way to leave the status quo intact while raising a bunch of revenue for the government and changing the incentives in the way that the politics want to see them changed at this point. so is it possible that those larger macro adjustments will have a different outcome than if we looked at the border tax in isolation? >> listen, i'm no macro

economist, but that makes no sense to me at all. right now we have an absolutely duty free environment in all of north america that has worked to the benefit of americans, our partners in mexico and canada, and i think to try to go back and revisit that would start off a senseless trades war. and what we know from history is that whenever any one country starts a tariff war, others follow suit and the losers ultimately are those consumers. and what we also ignore is we're not a net loser in this. you have bmw since i think i heard one of you mention a car you saw at the detroit auto show. >> that was me. >> bmw has moved the manufacture of all of its x series sport activity vehicles to here in america. mercedes benz moved all of their m class production. you talked about toyota. all of those big tundra trucks are made in san antonio, texas, and on top of it, toyota is

moving its world headquarters -- its north american headquarters to here in texas. we're not a net loser. a lot of foreign companies are moving to america to make products because the car industry in particular is one that's figured out it just makes more sense to make cars at the point of sale. so, i mean, i think when you net-net this out the way cars are manufactured makes sense, and if we're smart about dealing with regulations and dealing with taxes, i think the united states auto market can do quite well. >> very quickly here, let me turn away from south of the border and go around the world to dmien. you know, plenty of people feel like we're being bullied by the chinese in some cases and being taken advantage of with their currency. what would be your strategy? plump has threatened them with tariffs even though wilbur ross said that would be a last resort. how do you handle that delicate

relationship with the chinese as far as trade goes? >> well, you handle it with honesty. you look at the facts. you do what i think we did during the obama administration and we brought more trade enforcement cases against china than any administration before, including using a little known tool that no administration, democrat or republican before us had used, so i think we continue to do that, but we also should acknowledge what china's growth plans, we can be an extraordinary partner to them, but china has to continue to live up to the promises and commitments that it made when we allowed them to join the world trade organization. so i think the path that we took during the obama administration was the appropriate one. we strengthened enforcement, we brought more actions against them, and i would expect any administration, democratic or republican, to continue that. but, again, i think these threats of tariffs, while they

may sound good, all it leads to is for tit-for-tat and you raise prices for everyone. >> mr. ambassador, thank you for joining us. >> good to be with you. >> ron kirk, former u.s. trade rep under president obama. i've been hearing my friends on twitter. i know that wasn't a concept you were oogling there. that's a bmw electric car. >> in three colors like that? i don't think i've seen that out there. >> if you've been through the detroit auto show, you see enough concept cars. a cadillac that was to die for but it was a concept car and it never saw the road at all. >> remember the bold charger that ces was supposed to give us for the -- >> yes. yes. >> like fashion shows. you're just there to look at the pretty things. >> but we deliver on our promises. we've got a lot coming up over the next hour and a half. we have the market down 58 points as far as the dow goes and the nasdaq continues into record territory. up next we'll tell you why

shares of one pet hospital operator are catching a bid today. look at vca antech is up 30%. woof. >> yes. well put. don't miss our lineup of ceos including bb&t's kelly king and ginni rometty. we'll see how they say mr. trump's reform will affect their companies all coming up on "closing bell."

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the third percent gain. all other averages down a quarter percent. >> i love this story. >> it's surging on news that privately held mars is buying it for $7.7 billion. it's a huge deal. you may know mars for its m&m and snickers family. it's the largest pet food company in the world. vca adds to the company. vca and banfield were just the subject of bloomberg businessweek feature about how they're benefitting from the fact that we now have like 180 million pets in the country, up from 90 million ten years ago or something, and people are spending more and more on them. these companies are happy to push some treatment options for you as well.

>> hopefully we don't need pet hospitals for these guys. that was the clue right there. here's a -- is this a -- an evolutionary view of buddy? >> they're relatively up to date and he did get to see snow. >> saw snow? how did he like it? >> he was okay. i thought, you know, if you're an indoor cat, you've never had that experience. was he going to be upset, excited? it was unclear. >> i sent new ones of nick and nora. nora's the shy one and nicky, you know, just hangs out. >> we've been pretty lucky, i don't know about you guys, not a ton of dough spent on their health. dogs are so young still. >> we've had an expensive year. >> have you? >> yes. 2017. everybody is fine. pet insurance. think about pet insurance. time for a cnbc news update. >> i got the pet insurance for

bell and boh. trust me on that. footage from egypt's interior ministry shows the first moments after a bomb attack on a security checkpoint in northern sinai which killed at least seven policemen and one civilian. the attackers planted a bomb in a street cleaning vehicle that they had stolen a few days earlier. iraqi forces have made it to within striking distance of the tigress river which separates mosul in two parts. iraqi forces pushed into mosul from the east in november slowly making their way towards the river since then. and one of california's famous sequoia trees has toppled over. it was called the pioneer cabin tree. it succumb to the heavy rains over the weekend. the tree's trunk was hollowed out in the 1880s. it was so wide that cars could drive through it. it was a main attraction. the cost for a middle income family to raise a child to age 18 is about $233,000.

a 3% increase from a year ago. that's according to the agriculture department who kind of charts that kind of stuff. wealthier families who live in costly err neighborhoods and are more likely to use day care spend more than twice as much as the poorer households. that's the news update this hour. they're expensive and it doesn't finish when they're 18. that's the big thing. you've got to know they're yours for life. >> yes, they are. >> oh, boy. >> thank you very much, sue. >> you're welcome, guys. >> have a lovely day. 27 minutes left in the trading session here with the dow up -- excuse me, down 46 points. we have a leading trader who will join us and tell us what he's watching into the close the first session of this week. and we'll speak with the heads of bb&t, merck and ibm coming up about challenges in their businesses in a trump administration. stay with us. xunx tnd hyb tho en. your insurance company

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billion. takeda announced in september it was shopping for a multi-billion dollar acquisition to cut its dependence on domestic sales and it's delivering. >> the pace of deal making up more than twice. shares of bb&t have been up. up over 20%. will trump administration policies change the course from the idea festival kayla tau shi. kelly king, the ceo of bb&t is with us. >> glad to be here. >> so much is going right but the premise that's baked in, a lot is going to go right. gdp growth, low interest rates. >> the tax rate would be the most immediate, most likely to happen faster and have the most

immediate impact. regulation would be second to that and it depends on how fast, you know, president-elect trump and company can get the regulations reduced, but that would be huge. then, of course, interest rates are going up. we think they will steadily go on up this year and next. you combine that with faster growth and gdp, that's a good day. >> last month you said on cnbc that the lack of regulation helped contribute to the financial crisis. this morning larry somers said deregulation could spur the next crisis. do you agree with him? >> it depends on which regulation you're talking about. >> which parts of dodd-frank do you expect to get rolled back? >> a lot of dodd-frank relates to the cfpb which is not bad in and of itself. we need consumer protection across the banking system, but it needs to have better governance. i think even the director would agree with that. i think that's an issue.

and just the massive amount of deregulations that have come out and frankly the intensity of which the regulations are being applied is really huge. so i think some of those being rolled back is going to be a really big deal. look, it's not just the banks. you know, we exist because of our clients. i travel around all the time and i talk to our clients, our ceos. they will tell you -- they've been telling me this for years now, that they are not going to invest as long as there's so much uncertainty, regulations, taxes, obama care. it sometimes them. >> happy new year. this question is going to sound disingenuous but i'm sort of serious about it. you have found it tough to make money in the past eight or ten years because of the crush of interest rates. lending and borrowing hasn't made it. we've been paying more fees to make up for the money you've lost because of the interest rate decline. now the rates are going back up. are we going to see fee relief

for customers down the road, do you think? >> bill, i do. i think your assessment is quite accurate. you know, banks have to make a little money. i mean, even the clients should recognize that we need to make a little money to stay in business so we can still provide services for them. as, you know, rates went lower and lower and lower, you know, we had to have some additional income so fees necessarily went a bit higher. i think as we go forward and interest rates give us more spread income you can see some relief on the fee side. >> sure hope so. >> that would be one of the most interesting developments of a decade. kelly, i was going to ask you what difference would it make if john allison were down to rouleau's job as might be the case in a week or two? >> well, it would be different. john is a good friend. we've worked together for over 35 years. he has a really good grasp on the dampening effect on commerce

in the economy in general and the banking system with excessive regulations. i expect you to see john take a very practical, intellectually driven system to what regulation is necessary, which -- and there are many regulations that are necessary. i don't think any rational person wants to see no regulations but i think you see john approach it from a practical regulatory perspective. he would be energized and that would be a good thing. >> you're about to be in a new size bracket. >> i think there will be. in fact, in fairness to the governor, he was already making some moves in that direction. dodd-frank basically called for the strict $50 billion type of delineation which never made a lot of sense. a lot of it never made any sense. in fairness to regulators, they didn't create the law, congress did. yeah, that would be an improvement. >> this is a fintech conversation, what are you going to bring back to winston-salem?

>> i think we're going to bring back the understanding that fintech can work together. our bank and most banks have focused on easy, simple, fast service to our clients. a lot of the fintechs have as well. stability and security are very important. hopefully we can work together, learn from each other and make it an exciting place for the consumer. >> we'll let you get downstairs. kelly king from bbt, nice to talk to you. >> guys, we'll send it back to you in new york. >> thank you guys. we're going to talk more fintech. >> we've got 18 minutes left in the trading session here. the dow is down 46 points. for the longest time mr. wonderful was bearish on apple but on this tenth anniversary of the iphone, kevin o'leary is running with the bulls suddenly. why a change of mind?

we'll find out coming up. president-elect trump's plans to cut regulatory red tape could be a boost for the pharmaceutical company but it's also sparked safety concerns. we'll ask merck ceo kenneth frazier coming up.

the dow is lower but look at the nasdaq, continues higher. technology leading the way once again. up another 16 points. about 1/3 of a percent. any positive close for the nasdaq is another record high. >> a lot of those momentum names led the market a couple of months ago. seem to be back with a vengeance. all eyes on netflix last night at the golden globes. our julia boorstin is in l.a. with the aftermath. julia? >> hey, kelly. it was a night of some snub, some surprises. la la land swept it with seven awards and best film in the musical or comedy academy. fox's fx won the most tv awards. two each for atlanta and people versus o.j. netflix and amazon tied netflix winning two for its new series "the crown" while amazon brought

home one win in the tv category for "goliath." jeff besos won a couple of shout outs. hbo went home empty handed despite going into the night with the most nominations, 14 in total. throughout the night president-elect donald trump, he was secured in jimmy fallon's opening monolog and lifetime award winner meryl streep criticized trump's campaign rhetoric. she defended the importance of outsiders who are among the, quote, most vilified segments in american society right now. president-elect trump responded in a series of three tweets this morning calling meryl streep, quote, one of the most overrated actresses in hollywood and a, quote, hillary flunk can i who lost big. #merylstreep was trending on twitter last night and this morning people all over the world weighed in on this war of words between the movie star and the president-elect.

kelly? >> i'm not going there. >> me neither. >> julia, thank you. did you watch any of it, bill? >> yes. >> we'll leave it at that. >> sort of. on twitter. i saw bits and pieces, yeah. 12 minutes to go. dow still down 15. in fact, we moved a little bit lower. we're kind of holding in there. 19,905 is your level for the dow. the nasdaq is higher. russell small caps continue to under perform shedding .6 of a percent. >> meanwhile alibaba chief jack ma met with donald trump. we'll get some information from a money manager heavily invested in china coming up.

nine minutes left in the trading session. here joining us on the floor of the new york stock exchange with the dow down 54, the nasdaq higher in record territory. conrad zeldonis and oliver from bruneman. i saw your notes, oliver. your target for the dow this year is not very far from where we are right now. >> yeah. we think it's going to be a little bit of a bell curve. we expect a continuation of the rally into the first quarter up until around the beginning of the summer. then some of the political headwinds are inevitably going

to come into play and cause a reversal. >> post election rally steal some of the gains you were expecting? >> i would say so, absolutely. i don't think we were looking at a bad end of the year, but i don't think anybody realistically expected a 6, 7% gain in two months. >> conrad, you're an emerging markets portfolio manager. that's one area people have concern about because of the dollar and hey look at some of the biggest ones, china, the foreign reserves. even turkey is coming up a little bit. where do you see opportunity? >> i think the opportunity is in the end across the domestic side for emerging markets. yes, they're still on the exports front but that's grossly exaggerated except for places like mexico where you have 10% net exports to gdp. china has a couple of percent. but the focus is really on the domestic side for e.m. where inflation is down. the currencies are probably exaggerated because of the strong dollar, to be fair, but i think that's where there are

real opportunities. >> do you have particular examples? >> sure. when we look at our fund, a couple of our top positions is ten cent again in china. massive subscriber base with their chat service, we chat, and expanding into gaming which has done a phenomenal job. that's where they're going to monetize more with the subscriber base. that's a very interesting example of a domestic opportunity. >> if your expectations aren't that high, are you looking overseas? >> we're always looking everywhere. we want to get as far as europe is concerned want to get to the german elections. ian, it was his expertise, not mine. if you're an investor across the board, you want to focus on simple to understand businesses that generate a lot of free cash flow and can benefit from some of the fiscal stimulus that will be coming down the pike. >> how about for instances? >> for instances, california water works. nice simple company.

spins off free cash. these are types of projects that are most likely to pass under a trump administration and would help companies like that a whole lot. so, again, keep it simple. don't try to be fancy. we're avoiding areas that involve a lot of financial engineering or complexities that can be derailed because there's a lot of hope that deregulation is coming but we don't know when. you want to be careful there. >> any one you want to add other than ten cent? >> when you look across the smaller names, the htsc, smaller markets relative to china. it's domestically geared. they've gone through dem demonetization. the risk is on emerging markets, fiscal, whatever you look at. stocks are going to perform. a very high quality franchise out in india. >> conrad, and oliver, good to

see you both. >> thanks for being here. >> we'll take a quick break with the dow down 65 points. hello, peter. we'll have the closing countdown. >> after the bell, we'll talk to ceo ken frazier of merck. we'll see what's ahead for working with new pharmaceuticals and working with a new trump administration. you're watching cnbc, the first in business worldwide. ist.

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coming up on the last two minutes of trading here. ordinarily we would show the dow at this point in the closing countdown as we're moving down. we'll get out of john's way as he's trading here. we're going to give the nasdaq its due. no running. stay out of the way there. >> wow. >> the nasdaq in record territory with any price gain -- he never flinched. he never moved. it's the dow though. we've been waiting for dow 20,000 forever. not happening today. down 66 points right now. real tug of war today between technology, which has led the nasdaq higher, and energy which has moved and been a lager today. you look at the best and worst performers among the dow components. apple was number two on the best performing list right behind merck and exxon mobil was the number one on the down side, the biggest laggard and oil continued lower as well. there is talk that even though opec is going to be able to hold

its production cuts, guess what, u.s. production is going to kick in here with prices moving up and that might add supply that will push prices a little bit lower here. that traditional tug of war between supply and demand, the energy markets that's so tough to try and gauge right here, bob pasani. >> i'm getting concerned about oil. exxon and chevron are real laggards. down 2% from the year. oil has been relatively stable between 53 and 55. it's starting to drop a little bit here. exxon, there's a lot of hope here. exxon's earnings are expected to double in 2017, double in 2017. so it's -- even with that it's trading about 21 times forward earnings. so exxon's expensive. now the bulls are saying things will improve later in 2017 to 2018. now we're trading on 2018 numbers. now you know the market's a little speculative when you start trading on 2018 numbers. that's the problem you're going to have. companies need to say, yeah,

things are going to get better. raise your earnings numbers from 2017 otherwise you're going to have a little bit of a problem here. >> the companies with the guidance for 2017, that's what we need. >> thanks, bob. see ya later. go out with a decline at 72 points on the dow but the nasdaq remains in positive territory with a gain of 10. stay tuned with the second hour of the "closing bell" with kelly evans and company. i'll see you tomorrow, kel. thank you, bill. welcome to the "closing bell", everybody. i'm kelly evans. believe it or not, even though there's a lot of red on our screens, we have a record close and it's the nasdaq. by bucking the trend was able to move higher by .2 to close at 5531. so that one continues to set new records. we'll get more to the composition of how it happened in just a moment. meanwhile, the dow 30 down 1/3 of a percent. 19891. now we're back below 19,900.

the s&p 500 dropping about the same amount. 2269 for the broad index. russell small caps continue to move lower throughout the session today dropping nearly 3/4 to 1357 today. now coming up on the show we have two big interviews. merck ceo kenneth frazier and ginni rometty will join us live from the inaugural fintech ideas festival. let's head uptown to the nasdaq. bertha comes gives us the breakdown. bertha? >> a little bit of a perfect record, in fact, at least for 2017. the young year. up five days in a row for the nasdaq 100, which was really the engine today with those large caps that were moving and also up five days in a row for the biotech index. nasdaq biotech index now out of correction. they're coming off of one of its best weeks since the election in

terms of gains. and chip stocks today contributed as well. apple was the real powerhouse. apple closing at a two-year high with a -- almost at a 119 handle. just shy of that on the tenth anniversary of the introduction of the iphone that has really revolutionized mobile hand sets. but apple helped lift a lot of other stocks as well. take a look at some of the stocks today that were the real outstanding gainers. incyte, news coming out of the jpmorgan conference. that's helped biotech along with the deal for ariad pharmaceuticals. we saw strength on nvidia. that helped with apple. facebook is up 8% so far this year, kelly. facebook once again challenging exxon in terms of market cap. very close together now. back to you. >> wow. bertha, thank you. that certainly sets the tone for the year. joining us for the how is cnbc pro columnist, michael santoli and rbc's head of u.s. research,

mark puris and dennis berman from the wall street journal. welcome one and all. mike. interesting. is this back to the future. is it 2015 all over again where it's a facebook market and that's the whole story? >> the last two days have been like that. you have the very large cap tech stocks holding up all the indexes. maybe in the reflective light if nothing else. below the surface the average stock was weak especially today. the nasdaq setting a record. more stocks down than up. the equal weighted index to the down side. it's less than half a percent or thereabouts. it shows you that the market is trying to work off i think some elevated investor sentiment coming into the year. people got too bullish expecting immediate gains. technically speaking a lot of stocks being over bought. i don't see it being much more sinister than that. you did see treasury yields down. we need treasury yields to be going up for stocks to get some confidence going up.

>> certainly would help the financials. it's the yield curve. >> that's narrowed a little bit in the last couple of days. >> right. exactly. dennis, what about you? looking through here at some of the names moving today, surprisingly it was apple at a 52-week high. you had a couple of other all-time highs on the s&p 500. yeah. it was a weak day overall with that one exception of the nasdaq. >> santoli seems to be implying that it's time to sell. he used creative language. the market needs to prove itself. more importantly, mr. trump and his administration and the congress being able to prove themselves. in my mind right now in the first few months here of the new administration all eyes really turn to washington and whether they can effect the agenda that they've been talking about as it comes to taxes and trades. that can have positive and down side effects for stocks. apple may be up today, but in my mind mike has a good point about yields. secondarily the action turns to

washington. the inauguration is just a few days away. >> i take your point. dennis, let me ask you this, especially this being your bread and butter. deal making activity. $18 million worth total in the year already. i think that's a figure anyway. we're up about 2 times the pace of last year in any case. so even though a lot of them are kind of smaller deals or companies that -- i mean, we all know mars so the candy company buying the big specialty vet business is a great story. >> yes. >> if everybody's waiting so much on washington, then why are we seeing all of this deal making? >> come on, kelly. it's probably an anomaly of a small sample size of a few days. here's where i think it is important. that mars deal, they were buying something. it was in their realm of expertise, which is pets. they're getting into petd animal care, hospitals, actual veterinary care, lab care. just not things you associate with mars. these are businesses that are adjacent to what mars does, even in the pet food business. if you were going to say, i hate

to use this term, if you want to say the animal spirits are alive -- >> in this case it might apply. >> if you want to say the animal spirits are alive, this is an indicator that is the case because they're willing to do something that's outside the direct area of expertise. >> what do you think? >> veterinary care helps to keep the animal spirits alive. >> but speaking generally about the pace of deals that we're seeing, if everybody was waiting so much on what comes out of washington, why would anything be -- >> i don't think on a corporate level for many companies it's going to matter if you're going to be hitting antitrust or not. unless it's a tax motivated deal i don't see any reason why you wouldn't see this pace of activity given where the markets are at, where we are i think in the private sector. mars, by the way, a company that's extremely long term thinking. this is a private company that really is there for the long haul. they're trying to sort of diversify into an area that they think is going to be a great business for a long time. >> mark, bringing you in here, what are some of your -- the best ideas that you guys have for 2017? are they playing out so far at

this young stage? >> first of all, i have to out bull all the bulls that have preceded me. i think we have the highest price target for the s&p on wall street at 2500. >> wow. >> so we're pretty high. the assumptions behind that are not heroic, right? the idea is 8 or 9% eps growth. that's actually lower than what we think most of theage lists will be at. so take a few percent off there. we still get to a pretty robust number in that $2500 target. where we're going is why you're seeing some of the m&a trends and rallies in the market. names like pnc, big bank that has still opportunity to grow, it's exposed to the interest rate hikes, all of the things you would want to see. loan growth, healthier economy, deregulation a positive and yet not overly done, not overly exposed. >> did i see netflix in there, too? >> netflix is another favorite. a little bit of a different theme, you know? so we put together our 2017 outlook, our best ideas for the

year, a lot of those are around rates, cyclical, names like noble energy. we had a couple of names that are basically specific, competitive, unique situations. netflix is it. it's done well. it frankly had a 2016 where price hikes, we had challenges to the company. it was a lot more volatile. we think this year our big projection subscriber growth for 2017 can exceed what it was for 2016 which would be an up side surprise for most investors. a lot of that is based on the background dynamics. the comcast deal, other things happening. >> mark, turning back to what you were saying happening, the markets overall and the high price target on the s&p. that implies you guys thought we would be any day now doing dow 20,000. what do you think of the fact that we're not really making a decisive move over that line here just yet. >> i think we have to take a wee breath and kind of take a step back and realize. we've had a huge rally in the market recently. markets do this. we go up, we go down. the direction at certainly feels

positive. the reality as well is that if you look at the wind at our back continuing on, a bit of a longer term view, deregulation, lower personal tax rates, all of that. we don't know where it's going to end up. it will be positive. we're seeing m&a. those transactions will take months to years to play out. that's how long we're going to get the clarity on to see how this is going to play from a legislative standpoint. at the end of the kay iday, it' positive. that's a bit of what you're seeing play out. >> stay there everybody. let's talk a little bit more granularly what's happening with trump's incoming administration at this point. you've had a pair of high profile ceo's including alibaba's jack ma meeting with the president-elect today. john harwood has details from those encounters. john? >> kelly, the president-elect was eager to get the subject back on the economy rather than the subject we talked about last week, which was the intelligence community assessment of the

russian election hack. today at trump tower the president-elect tweeted first about the jobs that were added, the new investment by fiat chrysler even though those were long planned and signaled a year ago. he also met with jack ma of alibaba at trump tower and came out and they discussed the possibility that alibaba by letting american small businesses sell their wares on alibaba could generate a million jobs over five years. here's the president-elect and jack ma. >> we had a great meeting. it's jobs. you just saw what happened with fiat where they're going to build a massive plant in the united states in michigan and we're very happy. and jack and i are going to do some great things. >> small business. >> small business. >> focus on small business. >> thank you. >> thank you so much. >> now the president-elect also met with and appeared before cameras with bernard arneau, the chief executive of the luxury goods dealer lvmh. he talked about potentially adding a new factory perhaps in

north carolina, also adding jobs. and finally the news broke this afternoon from our come league, peter alexander, of nbc that the president-elect is going to make his son-in-law, jared kushner, a senior advisor within the white house. that would make him the most powerful relative of a president since bobby kennedy was attorney general for his brother john f. kennedy in the 1960s. jared kushner as donald trump will will have to work through the issues related to conflict of interest between public policy and his businesses. president-elect was asked about that and he said on both counts jared kushner and himself, he will talk about that at that news conference he has scheduled for wednesday in new york, guys. >> all right. john, thank you. and, dennis, with all of this percolating, we have the hearings and then we have the inauguration itself. there's already been discussions about how quickly this bill is going to come out of congress that would potentially repeal if not replace obamacare. a lot is going to be flying at

us. then there's earnings season. >> can we get back to jack ma and donald trump, kelly? >> yeah. >> i find it very interesting. look what happened in china. mcdonald's said it was getting out of china. we don't know exactly why. they had their stated reasons. kfc, what's it doing, getting out of china. so i think the trump administration has a reasonable point when it says what exactly is the access of u.s. companies into china and the same way that chinese companies have access to the u.s. and it is not going the same way despite whatever jack ma might say. the opportunities are not the same for china -- for u.s. companies. >> i know you've been saying that, dennis. you know, we've talked about this. i guess the jared kushner on bang is a seven rate pieparate . >> i was going to interject on the jack ma point. one of the reasons why i think jack is coziesing up more to trump is because of the china rhetoric. a second reason relates to one of our key surprise internet

surprises for the year that mark mahaney, my analyst put out, one random possibility, who knows if it will happen, is alibaba buying ebay. and so i think, you know, if that's something that's on jack's mind, that kind of transaction would make a ton of sense. >> you think that -- wait, alibaba is on some sort of ciphious list. do you think they're going to let them buy ebay. >> here's the point. nothing is going to happen in the trump administration unless jack ma builds a relationship. >> the only way it would happen is things like that. there's a reason why jack and donald were saying some pretty nice things about each other. i think you have to file that away. >> savvy guys. real quick point, dennis. >> nor should we forget the rampant counterfeiting of alibaba nor the subsidy of the chinese postal system. >> he came, he met, we'll see what happens. mark and dennis, thanks for joining us. >> thank you, guys. mark harris and dennis

berman. president-elect trump has also vowed to bring down drug prices so how are pharmaceutical companies preparing for life under the trump administration. merck's ceo kenneth frazier weighs in. first, the iphone turns ten today. sales of the iphone tanks. kevin o'leary talks about what it will take to get consumers excited about iphones again. you're watching cnbc, first in business worldwide. whatoing ur taeastyo i i bero.

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today apple is going to reinvent the phone. this is what it looks like. it's got a 3 1/2 inch screen on it. it's really big. and it's the highest resolution screen we've ever shipped. it's 160 pixels per inch. highest we've ever shipped. it's gorgeous. >> you know, we'd be lucky to have something like this happen once in our lifetimes. instead, it was ten years ago and it's old news. that was steve jobs introducing the iphone. ten years later the iphone has changed quite a bit. when it first came out the screen was, now we say, only 3 1/2 inches. didn't have an app store, gps, siri. it was only available to at&t customers. now the screen size is up to

5 1/2 inches on 7 plus. has over 2 million apps available in the app store and available for all major carriers. apple stock up 800% since the iphone was introduced on january 9th, 2007, when it was trading around $92 per share. that's 13 per share today on a split adjusted basis. apple split its stocks 7 from 1 in june of 2014. for more from apple, let's bring in kevin owe le o'leary. what do you make of apple? >> when i heard steve's voice, it sent shivers down my spine. i used to be the largest supplier for him in educational software. that guy was so brutal in a board room. whew. anyways, let's talk about the iphone. what i find so interesting is the market really in the last two years pushed down apple stock because of the concern that there wasn't any innovation coming. the reason the stock is hitting new highs is the promise of the services business becoming more

than 10% of revenue is finally within reach in 2017 and growing beyond that. and part of the reason is the platform of the 7 plus, that new phone is bringing promise to enterprise like i've never seen before. let me give you an example. the 7 plus 4 k optical camera and optical zoom is being used in the broadcast industry worldwide to broadcast live television directly as a feed. all kinds of new enterprise applications using that. here's the thing about it, kelly. if you use that app you have to buy tons of icloud memory. you put up your service contract by ten fold and that's what i'm excited about, why i'm long the stock. i love what's happening to the services business at apple now. >> you know, it's interesting, kelly. it's definitely the case that investors have had to come around and redefine what apple is as a business, because i think that that -- the launch of the iphone got everyone in the habit of thinking this was

somehow a repeatable thing or it's something that the company was actively trying to do, recreate something. >> everything. >> apple tv. >> exactly. >> waiting for the watch is another example. they would not only do this once like they did with the ipod but then do it with the iphone and then do it presumably with everything else. >> it's mostly been a burden to the stock. over the ten years apple shares have outperformed the market by 400% but it was almost in the first five years. from late 2012 to now it's basically been trudging along with the market. it's okay. i think we have to redefine what success is. >> a lot of people do harangue it as just a device company saying we've moved so far beyond that. a.i. is where you need to be and so forth. are you comfortable they're making that transition here and they won't get comoditized? >> you have to see that growth in services which is a very high margin business. i'm going to make the assumption that's the case but, you know, the whole concept that apple has to redefine itself with a whole

new platform and new product cycle, i'm not sure that the services business continues to grow at let's say more than 10% a year, people will stay enamored with this company for a long time because it will make a lot of free cash flow and the opportunity to increase its dividend is one of those tech stocks that does that. will the apple car come along? if you talk about a.i., i.a., everything else around a platform like that, then i'm interested because i think they have the wherewithal to bring a competitive product to market there. >> all right. but that's still -- you know, you're putting a lot in the future there for new category. they've done it once or twice, i'm sure they can do it again. kevin, thanks for joining us. >> take care. kevin o'leary. coming up, two big ceo interviews. merck ceo kenneth frazier with outrage and the potential appeal and replacement of obamacare and gini rometty joins us with how the tech industry is going to

work with president-elect trump. that's all coming right up.

welcome back. all day cnbc has been live at the 35th annual jpmorgan health care conference in san francisco. our own meg terrell joins us along with merck ceo ken frazier. >> kelly, thanks so much. ken frazier, thanks for joining us. >> always great to be with you. >> i want to start out by

talking about what's been going on in drug pricing. you're working on some incredible things for human health. at the same time the drug industry's reputation couldn't be worse. president-elect trump's focus on drug prices. how do you explain that tension and what the drug industry needs to do better to improve its reputation. >> i think the first thing we have to realize is we're at a very exciting inflection point in terms of innovation. medicines that are coming to market on hepatitis c, medicines coming to the market in cancer, alzheimer's are really incredibly important to our society because those are illnesses that could bankrupt our society if we don't get good solutions to them. as it relates to pricing, i think you have to figure out what the valid value proposition is for each medicine. i think it's hard to talk about it across generic, specialty medicines, primary care medicines. at merck we've tried to take a very responsible approach to

pricing. >> what do you think the main risk is when it comes to pricing, when you have a president-elect who the only thing he said about the industry is he doesn't like what's happening to pricing. he's taken to twitter a lot in other industry. are you concerned about the tweet risk? >> i don't look at the tweet risk as a separate risk. i think drug pricing is a very important issue for our society. affordability is critical so patients have access to medicines. at the same time it's also important that we have the kind of incentives that allow us to do the kinds of studies that we do to go after diseases like alzheimer's. >> let's talk about cancer because you had some news that drove up the stock of one of your collaborators, incyte. you're doing combination work in immunotherapy. tell us what the expansion of that collaboration signals about your confidence in how well this will work? >> we're very excited about kcuda. we're very pleased with having a first line claim for people with

not small cell lung cancer. we're also interested, though, in getting the right drug to the right patient. that involves different kinds of combination studies. so the work that we're doing with incyte allows us to look at that particular combination and figure out which percentage of patients might benefit from a combination over and above monotherapy. >> hi, it's kelly evans here. thanks, meg. >> hi, kelly. >> i wanted to ask you something and thanks again for joining us, which is i think on the minds of everybody these days when it comes to what's happening in this country. you talked about the progress you've made in cancer, the progress you've made in alzheimer's. what do you think is happening with the opioid crisis that is ravaging this country? we're really only just beginning to get a picture of how horrible it really is out there. i know this is not -- you know, you guys are there to talk about, you know, your products and things in the pipeline and speak to investors, but do you have any comments on how we could begin to now try to solve what seems to be one of the

worst crises we are now facing as a country? >> well, i agree with you. it's a terrible situation. it has to do with a lot of factors. it has to do with the environments in which people live, poverty rates, employment rates, has to do with the misuse of pharmaceutical products in some cases, has to do with some of these products like fentanyl that are available on the streets instead of heroin. it's a very complicated issue. as a society think we have to be focused on the welfare of all of our citizens, and i think from my perspective this is a critical issue that the industry needs to contribute to but lots of people in society need to contribute to. >> right. although is there a way if, you know, the president-elect, for example, came to you and said, how do we fix this, is it making treatments for effective for people overdosing? while we sort out all of the rest of the societal problems, is there a way to kind of relieve people of some of the most dangerous parts of their

addictions to these substances now? >> i think there are. again, this is not an area of medicine that merck is involved in, but we do know that there are medicines that actually help with overdose situations and i think they ought to be made available broadly. as i understand it, police departments around the country tend to be carrying these drugs more often than nod so that's an important thing. >> such an important discussion. i want to bring it back and just kind of end with a question about if you got invited to trump tower and were invited to meet with the president-elect, what would you want him to know about your business? >> i think the most important thing is to help him understand, and i think he already understands, how important it is to incentivize investment in the drugs we need in the future. we talk about things like diabetes and metabolic disease, we talk about things like alzheimer's, we talk about things like cancer. the cost of those natural diseases is actually very high relative to the cost of the medicines so we want to make sure that drugs are affordable but we also don't want to remove

the financial incentive for people to invest in a long, costly process of discovering new medicines for unmet medical need. >> just to wrap up very quickly, what he's only said is about drug pricing. do you expect he will be supportive of innovation? >> well, i think the industry has different components. i think there are companies like merck investing in r&d and trying to meet other unmet medical needs. other companies are selling generic prices that have raised the prices. i think it's more important not to treat the industry as one industry. >> thank you for joining us. >> always a pleasure. >> meg, great job. ken frazier, too, for speaking about all of these topics. appreciate both of you joining us. time for a cnbc news update. here's sue herera. >> the suspect in the ft. lauderdale airport shooting was told at a hearing that he could face the death penalty. esteban santiago says he understands the charges against him.

a public defender was named. five people were killed in the shooting on friday. the pentagon says a u.s. warship fired warning shots at iranian boats approaching at high speed as it traveled through the straits of hormuz. the "u.s.s.mayhan" was traveling through. millions of commuters face delays as a strike shuts down much of london's subway network. subway lines were closed during the morning rush hour forcing many to walk as you saw there, use overcrowded buses or drive to work. portugal's cristiano ronaldo has been named fifa's best soccer player of the year. he beat out lionel messi. quite a rivalry there. that is the news update this hour. kelly, back to you. >> sue, thank you. let's send it over to seema mody. >> we're looking at shares of barracuda up 6%.

earnings beating expectations, 22 cents adjusted versus the estimate of 14 cents. revenue topping wall street consensus as well as billings for core products increased 30% in the quarter. the company citing increased customer adoption of cloud-based security against these shares. now up about 7% after hours, kelly. >> seema, thank you. ibm's ceo ginni rometty is the only advisor on trump's group. she'll tell us what her dealings with trump have been like. first, we'll look at the biggest potential threat to the economy this year when we speak to the chairman of the eurasia group. stay with us. ma 00 ., ecec

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welcome back. it was a tale of two different markets or maybe the nasdaq and everybody else. the nasdaq is up 10 pints up to record high. how about everybody else. the dow is dropping 1/3 of a percent or 76 points to go back to 19,900. similar drop for the s&p. the russell 2000 small caps down

nearly 3/4 of a percent. big banks are vying to be first in financial technology. executives are meeting at the inaugural fintech festival. we're joined with ibm's ceo. >> kelly, that's right. let's get right to ginni right now. i know you just got off the stage. we're going to talk in a minute about the fintech ideas festival. you were one of the first ceos to reach out to the president-elect, the first chief of technology to be named to his jobs advisory board. now that we are a few months on, clearly you have the president-elect's ear, what are your thoughts on his strategies, tactics towards corporate america? >> well, one of the most important topics i think for all of us to work on is job creation. to me that's even more important in this industry. and that's one of the topics that we really focused on front and center, which is something called new collar jobs. and this is the idea that, you know, i'm here at the fintech

conference. we talked about artificial intelligence, block chain. with any new set of technologies, with them comes an impact, impact of productivity to the jobs and the like and also you create new jobs around it. and so in this country there are millions of jobs open around technology, and this will come down to being sure education's in place. so this idea of new collar says for the jobs of the future here, there are many in technology that can be done without a four-year college degree and, therefore, new can collar not blue collar, white collar. it's new collar. and our centers, some of our big centers in the united states, 1/3 of the folks don't have four-year degrees. so we've worked with over 100 schools over the weekend. we have pathways to technology. think of it as a four-year high school, two year associate, community college, six-year degree or six-year high school if you want to call it that to

produce kids that have got the basics that are employable and not just in our industry, it's in many industries across the country today. >> you're talking 25,000 jobs in the u.s. >> over the next several years. >> 6,000 this year. are you creating any new jobs? are you thinking of moving any manufacturing or services jobs? >> we do very little manufacturing. as you know, we are a services and software, a cloud company. >> services job. >> manufacturing, we do a fair amount of manufacturing here in the united states already. and so this is going to allow us to do many things here and so we're building and hiring out in those centers for clients. and so a lot of this is around think cyber security, think artificial intelligence, watson, what's out there. i am quite confident because i've seen the results of this program already and we've hired many, many kids out of this already. >> the reason i ask is because the president-elect has had this strategy of tweeting out and we kind of know what his strategy has been, but is it something that worries you that one day he may decide to tweet about ibm

and how many jobs you have outside of the u.s.? >> no, all of us take the right actions for what our company is. many of us are global companies, of course. we have work forces around the world. that's part of what it means to be a global business. you have sales forces and the like all over the place. so like others, we continue to do what is the right thing for our own business and do the right thing for ibm. >> i also want to talk about ibm stock which has been up 125% over the last five months. also the pace of quarterly revenue has been decreasing. what's changed? can you continue this momentum going forward? >> we've shared very broadly our strategy and the transformation we've been on. i think you see three things playing out. cloud, cognitive two sides of the same coin under pinned by the industry. a large part of what i'm doing here, just look at the announcements today. this morning we made an announcement in health care with

alumina that watson will be. they are the largest genome sequencing producer. watson will be there. dtcc this morning. they are the one that does all of the credit derivatives and we made a big announcement with them on block chain. so this is about serious business with a strong industry dimension. cloud, cognitive, block chain and you're seeing that come through. >> right. you were just telling me earlier that this is going to be a big year for block chain. >> a number of these technologies this is going to be a tipping point. chapter one is over and you're going to see serious business done with these. >> great. >> so i take something like block chain which at the end of last year we had announced cls which does all of the fx settlement, 5 trillion a day building with ibm on hyper ledger to move that. >> i think we're going to be talking about it a lot in the future. >> you will. the opportunities are hundreds of billions. >> thank you very much for being here with us. we look forward to talking to you again soon. kelly, back over to you. >> thank you so much. with ibm ceo ginni rometti.

the chairman of the eurasia group lays out a plan and wilbur ross and trump's cabinet confirmations kick off. which business men will face the toughest line of questioning? that's coming up.

report on a risk for a global geopolitical recession. the silly gone valley relationship, china and all of these could be factors. joining us is cliff cupchin. the chair of the eurasia group. this is one of those years where we know we'll be facing a lot of ethical events, elections in the u.s., europe, all of the things you mentioned. do we need to worry more about the known risks or like any other year the stuff that could come flying at us? >> this is the year of unknown risks. the election of donald trump i think brings to the forefront retrenchment of u.s. power. u.s. stewardship over the economy, over our security system. it will recreeede. >> i see here you're talking about an independent america being basically the top risks. explain that a little bit. >> america first is really

playing on americans cherish independence. independence from alliances, independence from international institutions, independence from your national interests. now when you get that you get a retrenchment. you get what we call public goods. no provision of them. no caring for military alliances. you get a much more risky world. >> you know, you have -- your next point on your list is china overreacting. >> right. >> i'm interested in how you gain out what china might do about the tough talk that president-elect trump might have directed towards it. today you have him entertaining jack ma, one of the biggest business men with connections to the chinese leadership. what would chinese over reaction look like? >> it takes two forms. if as is likely the trump administration takes a different rail towards china and geo politics, supports independence,

we could see a reaction. south china sea, letting boats through there. xi jinping. he could impose capital controls. then you get global economic volatility. china is a real wild card this year. >> i don't want to harp too much on this, cliff. isn't an independent america what we've seen playing out in the last eight years? there has been a receding, a vacuum that russia and others have gone to fill. afghanistan, so i take your point about how maybe we're receding this year from some of the international order, but in a way it feels as though we're already back knocking people's heads around in a way that we haven't been the last many years. >> that's right. we ain't seen nothing yet. obama led from behind from time to time but trump is questioning the value of nato, trump is

questioning the value of supporting the politics. that's a totally different level of retrenchment, of engagement, of backing up than i think we've seen in post war history. we're talking about the viability of parts of our economy. we're not talking about leading from behind. >> understood. what about technology which comes up a couple of times? just to change gears here. >> yeah, sure. >> technology in the middle east and silicon valley versus the white house. >> silicon valley versus the white house is a real, you know, watch your head during trump. i mean, look, with silicon valley we have politics, we have economics in play. he is going to try to control the media. the media doesn't like bad news. doesn't like the alt right. well, that challenges trump's popularity. trump prioritizes national security over priority. could see a real clash between two political titans, the

president, west coast during the next presidency. >> well, cliff, thanks for a preview. >> sure. my pleasure. >> trailer. cliff kupchan of the eurasia group. the confirmation hearings could start tomorrow. who could face the toughest time tomorrow on the hill? we'll ask next. uber has been collecting traffic data and we'll share it. we'll tell you what could be happening next coming up. u had ca

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welcome back. ten years ago the dow was trading in the 12,000 range. beyonce "irreplaceable" was number one and "fast money" became a staple for viewers. our melissa lee joins us for

what's in store for this ten year anniversary. >> we're kicking off the next decade with a jam packed roster of very special guests. we kick it off with carl icahn. an early "fast money" guest. he had one of these activists wars. he'll join us tonight. former ceo of viacom along with the ceo of vice. and, of course, the biggest "fast money" fan out there besides my mother is regis philbin. we have a lot going on. >> i feel like you should get a vacation or something. this sounds like a lot of work these ten year anniversaries. but congratulations. huge congratulations. quite an achievement. >> thank you very much. >> we'll see all of you including the original guy adami. >> he's getting ready.

>> i thought i saw a sleeve. the sleeve was in the shot. >> sleeve is on site. >> we'll see you guys soon. congratulations again. we have a news alert on president-elect donald trump secretary of state designation rex tillerson. >> "usa today" posting a story that's likely to get some attention this week in the run up to rex tillerson's confirmation hearing to senate. rex tillerson former chairman of exxonmobil and now the nominee for secretary of state under donald trump, "usa today" story reporting that exxonmobil an iran did business while tillerson was an executive at the company. they said there were $53.2 million in sales over two years. the sales were conducted in 2003, '04 and '05 by infineon. the transactions were legal despite u.s. sanctions because infineon was based in europe and

did not involve any u.s. employees. i think you've just been looking at some of the schedule there who will be confirmed or have confirmation hearings this week up on capitol hill. it's going to be a busy one starting tomorrow with attorney general nominee sessions. homeland security nominee kelly. you see tillerson will be up there on wednesday, testifying on capitol hill. you can expect he'll be asked about all of this. already he's viewed as perhaps one of the more wobbly trump nominees in the sense there are some republicans out there who are not entirely sold on his nomination as secretary of state including senator john mccain who had this to say when asked about tillerson's relationship with vladimir putin when he and senator lindsey graham sat down with chuck todd over the weekend. here's what he said. >> mr. tillerson's relationship with putin personally and russia has raised concerns with me. i met with him. i still have additional

questions. i think there's a couple of areas that i feel better. >> now we're also getting a look at tillerson's financial disclosure report. in that he reveals a couple of things including h holds some stake in chinese company stock and chinese companies. he holds a small stake in russian internet company. senators will be pouring over those to take a look at tillerson's holding and get a sense if any of that would pose as a conflict if he's confirmed. >> the main question is sort of a procedural one. will they kill the filibusters, the republicans if they do so then it does echo what president obama did which is what was said was an overreach. >> one of the things to watch here is republicans support for tillerson, how much does that wither in the face of these different disclosures or do republicans decide we'll hang

tight and stick behind the president-elect and give him the team that he wants. that seems to be the message coming from the republican leadership and we'll see whether the rank-and-file are willing to do that or not. that will be an unfolding situation as the week goes along. >> thank you. a busy week with all of that going on. uber is ready to release its traffic data and who gets first crack at it may surprise you and may not depending. tomorrow at "halftime report," billionaire mario gabelli gives his market prediction for the new year. that's tomorrow at noon. don't miss it. ato ?inst vtyfl

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welcome back. uber is making use of all the data it's been collecting. it is launching a website called movement. it's to give city planners and research towers understand and improve their respective cities. a couple of parallel things are going on. new york city is trying to crack down on them and one of the requirements or things being worked out is whether uber would share its data with the city so it could track and make sure you weren't getting charged or just track you.

>> it's anonymous, aggregate data. not so much a check on individual trips and when you're following the rules. it's funny. i view it as a google trend. the company saying oh, we had this trove of data, we'll put it out there and see if it's useful to anybody. maybe a high minded gimmick it will help urban planners. >> one of the other stories i love was a new jersey town that couldn't afford to expand its train station so instead was subsidizing citizens $4 each way to take an uber to train station. they figured it would be far less expensive than build a parking lot. >> a shadow infrastructure that's out there and you can maybe invite in whatever you like. >> the data piece goes back to the fact they track you five minutes after your ride. >> for some reason i'm not that concerned about that part of it. in fact, one of the funny things, when i've taken uber in new york they rely too much on the gps. the drivers don't know the short cuts. almost funny that they think

that their data will be privileged inside look at how traffic should go. >> it's worse than anybody has any idea. >> it's the yellow cab drivers know the game. >> michael, thank you. until tomorrow that does it foreclosing bell. "fast money" and its tenth anniversary begins right now. ♪ a very special "fast money" starts right now, x marks the spot, america's post-market show turns ten this week and we're kicking it off the next decade with a jam packed week of guest. carl i can is here this week. we got a lot of surprises for you by the way all week long so you won't want to miss a minute of our celebration. we'll kick off where we always have with the markets and your money because it looks like