>> bellwether then. >> boeing, really quickly. they can't sell enough of these planes. eight years of backlogs and selling like crazy still. >> treasury, .4. goes higher there goes the financial. >> buy lulu lemon, still the last person in new york without yoga pants. >> "power lunch" starts now. >> i'm michelle caruso-cabrera. lockheed martin wraps up the president-elect at trump tower. plus a slue of bank earnings hitting the street. one major company just took a $115 million writedown thanks to a monster box office bomb. we'll explain. "power lunch" starts right now.

welcome to "power lunch." up .6%. among the biggest winners here at the nasdaq, dexcom, monster beverage, maxi integrated. >> melissa, thank you very much. tyler mathisen. welcome to "power lunch" heemplt is what else is happening at this hour. to pick a new chair, paving the way. u.s. grand jury indicting three former takata executives with related to that company's air bags. and ice storm across the plains and midwest. it could move into the middle atlantic states by sunday evening, messing up what will be a rather light holiday commute monday. big news out of trump tower

within the past half hour. lock heed martin just wrapping up a meeting. first they get called out on twitter then she gets called in for a meeting. >> she was in trump tower about 20, 25 minutes. when she came down, here is what she had to say. >> had a great meeting with president-elect. it was outstanding. we had an opportunity to talk to him about the f-35 program. and i certainly share his views that, you know, we need to get the best capability to our men and women in uniform and at the lowest possible price. i'm glad i had an opportunity to tell him that we are close to a deal that will bring the cost down significantly from the previous lot of aircraft for the next lot of aircraft. and, more over, it's going to bring a lot of jobs to the united states. >> point of reference here on the f-35, which donald trump has been hammering the cost of.

the initial batch -- estimated cost here, and it's a little hard to pin exact cost. estimated cost $110 million for each of the f-35s. previously, lockheed martin said we could bring that cost down to $85 million by 2020. we'll see exactly how low the price is and whether or not the reduction in cost they're close to achieving will be enough for donald trump to finally say, okay, i'm happy with what i had to hear. we've seen this script before, whether it's with boeing, ford, whatever the company might be. you go in. you tell him, i understand your concern. i understand your complaint and, oh, by the way, we think we can make a deal with you, whether it's lowering the cost of a particular product or meeting your concerns and also they said they're going to expect to create 1800 jobs in the ft. worth area in addition to thousands and thousands of others. we still have not heard from donald trump. i expect we'll get some type of tweet at some point, guys, regarding this meeting. >> we're pretty sure these are

additional jobs. are they, phil? >> we don't know. >> an entire website created for the f-35 program designed for lobbying. state by state and click on how many jobs they say they have created, to counter the long-term criticism of this program. >> correct. we don't know if these are 1,800 new jobs. all we know is what marilyn newsom said when she said we are going to create about 1,800 more jobs in the ft. worth area. in a year, year and a half, it's interesting to see how many companies actually create as many jobs as they are promising. >> waiting to see. thanks, phil. >> phil, thank you very much. holiday sales numbers, the final ones are in. courtney reagan has the verdict. court? >> widely sighted holiday sales results in today, up a stronger than expected 4%. national retail federation says americans spent more than $658

billion. now the group's forecast was for holiday sales. online and in-store combined to grow 3.6%. that's why we say it's stronger than expected. it is above the seven-year average or what we've been looking at since the recession. and this season, december did strengthen slightly from what we saw in november. one of the big inputs for the results here is the government's sales number. they don't disclose the rest of the equation of how they get to those numbers but nonstore sales fueled the growth, including online shopping. in still just a fraction of what's purchased in store, those grew more than 12.5%, according to the nrf, whose forecast for e-commerce was growth for % 7% 10%. furniture, home furnishings. a stronger than expected holiday

season in total thanks to online. >> courtney, thank you very much. let's bring in our panel of retail experts, equity retail analyst, who introduced us all not long ago to the bralette. and bbg ventures, early stage investment fund. welcome to "power lunch," one and all. >> you just came back from a conference of retailers and restauranteurs and your verdict was pretty depressing. >> yes yes. what's interesting, you look at these numbers in the aggregate and then the individual companies. i can't tell you how many investors have been asking me is retail dead or telling me, i hear retail is dead. then you get these numbers and all of a sudden it sounds better. it's interesting to think that e-commerce is another word for a very large player. we hear about the amazon effect but companies within the holiday

framework wasn't as good. >> let me ask it a different way. is traditional retail dead? >> traditional retail is really challenged. i think it is in crisis, in many ways. look, there's this huge bubble of new consumers coming up, millennials, 75 million of them, who grew up with technology, who expect products and services to come to them. so, that's the start of t amazon has had a huge effect on all of these retailers. even when people do go into stores, they go back home to see whether they could buy it less expensively and get it shipped to them for free on amazon. and, finally, direct to consumer brands are having a huge impact as well. >> in other words, manufacturers, ralph laurens, people like that, who can sell directly to consumers bypassing macy's or bloomie's? >> exactly. department store used to be very

innovative in the sense that it brought together many, many brands. you could go to one store and see it all. you can do the same thing now online, right? >> like that. >> exactly. and the great direct to consumer brands are able to really tell a story, a brand story that -- >> so what are you to do if you are a retailer and have a wide array of products? let's say you're pier 1, crate & barrel, whoever you are. a lot of times i'll try to shop online for a rug, set of dishes but there's no substitute for eye balling it, touching it, seeing it and judging the quality of it. >> depends on the product. when you think about it, you are having this other dichotomy where the bigger keep getting bigger, very hard to catch up

to. and smaller are given the entry. barriers to entry are gone. you don't have to spend a large amount of money. you enter that world by buying a domain. you could create your moat, scale above it, and protect the money. so you need to fwiv me a reason to come to your store or buy your product. >> forgive me, this means to me that niche retailers have an advantage here, ulta. >> they also have a common denominator that they're taking share from department stores. the ultimate place where retail was going to get transacted, anyone taking away from that will benefit. >> makeup, with ulta, huge makeup counters and perfume counters and instead you go to a sephora or ulta. when it comes to the stocks tell me about leverage. when do we start worrying about bankruptcies and stocks going to

zero? >> we have, right? it's very hard to kill a retailer. and the past year you've seen it. the reality is that we're seeing these different pieces where they're changing. you've seen some in the power world, athletic world. who is not to say it won't continue? >> is there anything safe to buy or stay away? >> multiples are a little bit leaving the question. good companies will cost you a lot of money and i think that's -- the three that tyler mentioned, we like those a lot. >> take your head outside of the retail space strictly defined. it would seem to me that what we're talking about here, if there are a lot fewer stores and a lot less traffic in those stores, rents are going to collapse. mall operators are going to have trouble. the shopping center operators are going to have trouble. >> that's already happening. >> are we on the precipes of the

decline of the retail stores? >> one of the stories you saw come out of this last round of earnings is a lot of store closings. >> macy's, sears. >> absolutely. >> kmart. >> yeah, l brands. many, many of them. and so no question that that is going to impact mall operators. that's going to impact downtowns. >> yes. >> but in some cases, that may not be the worst thing. right? there are definitely areas in our city, for example, where the rents have gone up to such an extent that it's pushed out many, many great stores. it's a transition period. there will be opportunities that come out of this and there will be some big problems for -- >> final thoughts? >> keep in mind, to that point, the department stores aren't paying all that much rent.

you're getting this interesting opportunity where if you can take that, supplant it with -- you talked about different people who can fill big boxes that can pay rent, not the worst thing in the world. >> sporting goods. >> good to see you, susan. >> not me? >> simeon, yes, of course. i'm waiting for a bralette. baker hughes out with its weekly rig count numbers. we lost seven oil rigs this week and only up seven from a year ago. for multiple weeks in a row, as we've seen these prices moving higher into the 50s, we've seen rigs come back online. seeing a bit of a pause here, might speak to this larger theme that analysts were talking about as prices went up. big oil, at least domestically, will monitor and police itself in some ways to make sure that

we don't see the kind of price depression we saw last year. you look back to where we were last year to now, wti prices are up 72%. back to you. >> thank you, jackie deangelis. the financials have been flying in this rally. we've got a special guest here at the nasdaq to help us trade those banks. >> yep. >> lockheed martin ceo not the only one at trump tower. it's been a busy day of meetings. who else showed up at trump tower? that's still ahead. onmome

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bank of america wells fargo also impressed with their sales. focus turns toward 2017 guidance as well as q4, as you said. benefit of high rates and associated boost earnings is still to come and costs remain under control for jp morgan and bank of america, too,

encouraging leverage and being boosted even before any potential deregulation. jp morgan's jamie dimon said he felt the economy was gaining momentum. this is why. >> look, of course, at broad spectrum, capture, household building, formation, wage income, wages going up, unemployment going down, retail sales going up, it looks like it's getting stronger, not weaker. that's just my own personal belief. >> he also had positive remarks for president-elect trump's appointments of rex tillerson, steve minuchin and ross. and a corporate tax cut effect on the economy. as for wells fargo, despite headline appearing to miss and scandal update still year on year terms but trend on a monthly basis is improving. regardle regardless, they're looking to close around 200 branches this year and have announced a new compensation plan that does not

reward people for sales targets being hit. all in all, these numbers across the board and, more importantly, the guidance, is good reassurance for the bulls out there. >> we saw a big rise in long-term yields. yields steepening in q4. it we see that impact yet here? is that where they expect more upside in the future? >> what they're saying in the guidance, on the eps line, not even from the great rise in rates if that benefit is to come through to the next quarter. in terms of how much share price are we likely to see, we've had the multiple expansion, go from one to 1.3 times. that's the big leg up. what we've got now is just defining that multiples and the earnings themselves come up, more of a grind from here. but there's upside. >> they've got to prove it. >> exactly right. >> thanks. >> pleasure as always. >> trade on banks. with me now, cnbc contributor and vast money trader. guy? >> mel! i love being here. >> here at the nasdaq or "power

lunch"? >> "power lunch" at the nasdaq. tyler, can you hear me? >> i hear you, baby. >> i have to ask. what -- you said bralette before? >> yes, we were introduced by simeon before christmas to this new product line. >> it's a hot retailing trend. >> hot retailing trend. >> it's a light bra. >> the structure to it. >> i need one. i can't speak for you. it's a light bra. >> i'm sure the audience is thrilled. i didn't know that. >> it was news to me. >> that's why have you to watch "power lunch." good thing or bad thing considering how bullish dimon was? >> jim cramer described it as

the best quarter by a bank ever. i'm not nearly as profusive in my praise. it was a pretty solid quarter. we've had this conversation on fast money. i don't think people are looking at pe levels necessarily. i think what investors and traders are saying is, look, at the height of the banks, when things were great, '06, '07, some banks trading at 2 1/2 times priced the tangible. here you have jp morgan trading about 1.4 times or so, priced to tangible. i would submit if anything goes their way in 2017, these banks should be closer to 1.8, 1.9 priced to book. 51.5 times tangible book. you're looking at a $92, $93 stock. >> the more money centered banks is doing very well today, holding on to its gains very

strongly. bank of america said about the impact of rising rates in the first quarter, meaning the current quarter we're in, they'll earn net interest income just in rising rates, what we've seen so far. does that justify this climb in kbe? >> i personally think -- let me be clear here. they've all been spot on to it. i'm getting to this party late. is it a good sign jp morgan is trading off today? think about the run it's had. jamie dimon announced he was buying shares of the stock, jp morgan. it was trading $53 on that day, s&p traded down to 1810. >> right. >> look at the run since then. a lot of people are set up, long weekend, on a friday, into a long weekend, why don't we take some profits in the name?

i'm not suggesting that this is the top by any stretch but an encouraging sign. >> we had -- >> love him! >> bet on black. is this one you want to get into? >> why has it been a la gggard? >> money moving out of active into passive. >> carl ican. >> exactly. one of the many shows you host. not least -- in my opinion, the most important. obviously, i'm somewhat biased. we said carl is not -- he is off base on this one. and any weakness in black rock should be bought. stock has done pretty well since then. i'm with rich ross on the blacks. if you ask me which one to

choose, it would be blackstone ahead of blackrock. >> got it. >> back to you, mel. >> bank of america ceo brian moynihan and jp morgan ceo jamie dimon. be sure to watch. tyler? >> thank you very much, melissa. up next, we're going to talk harry potter, calvin klein and north face jackets. the good, the bad and the ugly in today's trade when "power lunch" returns.

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upgrade to buy at deutsche bank, 1.23%. the bad vf corp, downgrade from canicord, expressing concerns over the north face brand. another supplier to the retailers is where it's ugly, pvh, manufacturer behind names like calvin klein and tommy hilfiger. off by nearly 4%. perhaps in light of what we saw in retail sales that we talked about earlier, tyler? >> michelle, thank you very much. buffett's big bet on ibm, close to making money on his investment. should you be taking a closer look at this dow outperformer? it had a good 2016. look at the one-year, 27% up.

and the right versus the right. the adjustment or border adjustment tax causing a rift within the gop. michelle just wrote about it. we're going to talk about it, because we can't talk about it enough. border adjustment. i know. unins red.d.rod percwhth is roeywawa thk ititer..

hi, everybody. i'm sue herrera. here is your cnbc news update this hour. secretary of state john kerry telling an audience in vietnam that the change in administration in washington will not alter the relationship between the two countries. he spoke at ho chi min university. >> our friendship doesn't depend on individuals or personalities, one president or the other, one party or the other. our friendship is rooted in interests that we share and in the things that we agree upon about the future. >> the epa finalizing a determination that the landmark fuel efficiency rules instituted

by president obama should be locked in to 2025, a bid to maintain a key part of his climate legacy. they moved up the to meet the standards by 2025. lord snowdon who married princess margaret died peacefully at his home today. snowdon was one of the country's most famous photographers. he was 86 years old. that is the cnbc update this hour. back to melissa at the nasdaq. >> sue herrera, thank you very much. where the marks stat stand right now. the dow is struggling once again. 20,000 so elusive here. nasdaq hit a record high in today's session but backed off some of those gains. health care best performing sector right now. re what day is today? >> friday the 13th, mel. why do you ask? >> one month ago the dow came

very close to 20,000. since then we've done almost nothing. >> sideways. >> it's been 21 sessions. >> how long have we been together, you and i? in terms of tv partners? >> eight years. >> eight years in march. one thing that i've said for almost the entirety of those eight years is the market doesn't give you ample time to buy the lows or, in this case, sell the highs. by that defense, we've just been going sideways which, to me, is an encouraging thing i think it's better we go sideways for a while than blast through and give it all up. everybody is looking forward to dow 20,000, i don't think that's, by any means, catastrophic. i will stay positive in the market as well as the rustle stays above 130, which it is. >> that bit of market wisdom sounds to me like maybe you want to sell these highs. >> because you think -- >> we're sitting here and so usually doesn't give you this long to sell the highs.

>> meaning that it's got another leg higher. that's my point. you know, markets don't like to give you ample time to buy the lows and sell the highs. the fact that we're staying around the highs lead mees to believe -- i could be wrong -- >> there's a reason we are staying here. >> sticks out like a sore thumb, not netflix, not russell. comments out of president-elect trump or hillary clinton would have got these things reeling. ibb, right back to levels we were a couple of days ago before president-elect trump spoke about the pharmaceuticals. i think that's encouraging. i think the closet winner here is biotech. >> yep. we're still up nicely for the year. all right, guy. thanks. tyler, over to you. >> all right. folks, thank you very much. been a busy day, as so many have been at trump tower.

let's get to eamon javers, tracking the comings and goings. >> tyler, you're right. bunch of high-profile visitors at trump tower, including marilyn newsom, ceo of lockheed martin. we saw the damage that this his comments did to their stock price. she's following up on the playbook that so many ceos are developing of how to deal with a president-elect who is not afraid to single out individual companies or ceos. one of the things she said when she came out to talk to reporters after the fact was all the new jobs that they're going to be creating in various different states. that seems to be one of the tactics that ceos are using to try to get on donald trump's good side. we'll see if it works for her. coming into trump tower today, richard trumka, head of the alf-cio. they endorsed hillary clinton. this is a big democratic group. there is a win/win somewhere

here in negotiations for both of these sides. trumka really has an opportunity to get things done in washington on trade that he couldn't have gotten done under any other electoral circumstance. donald trump has the opportunity to do that and also to reach into union voters, which have historically gone for democrats in big numbers and really pull that group into his coalition in sort of a permanent way. that's a big political opportunity as well as a legislative opportunity here on trade. remember, one of the things that donald trump has said that he's going to do on his first day in office, next week, is to start opening up the process of renegotiating or repealing nafta. >> he said he's not going to take a break at all. it will be a key day. thanks, eamon. >> michelle, this involves takata corporation. the corporation that has made millions of air bags, defective air bags. now the department of justice confirming that it has worked a deal with takata where they will plead guilt toy wire fraud.

it also agrees to a $1 billion settlement that's part of a plea agreement. in addition, three former takata executives are also going to be charged independently of this plea agreement. ta kch takata will pay $125 million in victim compensation and another $850 million to automakers. this investigation has spread over the last year and a half. there have been several deaths linked with these faulty air bags. takata now pleading guilty to federal charges of wire afraid. back to you. stephen michlt nucminuchin l have his confirmation hearings next thursday. this looks to be one of the toughest nominees to get past this point. he will be testifying in front of congress for his confirmation hearings thursday, the day before the inauguration.

one of the things he might get asked about, maybe, is the border adjustment tax. yesterday here on "power lunch" a moment that was completely emblematic of what's happening behind the scene between republicans in washington, d.c. right now regarding corporate tax reform. if you missed it, here's a highlight. >> to renegotiate this into some kind of massive border adjustment, which will penalize imports and subsidize exports, that is an exercise in government planning and complexity that i believe is doomed to fail. >> we need to get larry over here to congress and talk in-depth about this behind closed doors. what we're really saying is the same thing. we want economic growth. we want to have business taxes completely revamped in this country because we want to encourage people to invest in the economy so that jobs can be created so that donald trump can be successful. >> let's bring in steve liesman, doing a lot of reporting on this issue, to answer the question of why some republicans are so

insistent or something that's so controversial. >> larry usually writes the memos but in this case he didn't get the memo. memo would have said this is a very complicated tax but the main thing we should know about this is that it raises a lot of mon money. that's why they're behind this. republicans stopped a 20% tax on imports, no tax on exports. it raises nearly $1 trillion over ten years. and that is critical because it's seen as a major revenue source to help pay for a lot of other stuff that guys like larry want, like individual and corporate tax cuts and infrastructure spending. without the money other ideas could be watered down. >> if you give up the trillion dollars of revenue from this border adjustment provision, maybe the corporate rate can't come down to 20 or 25 or 15, whatever the final number will be. maybe you have to phase in expensing. >> there's the reason why the market could be ahead of itself

to the extent it's pricing in a lot of positive developments from the trump administration. ken griffith from citadel earlier this week or over the weekend says he thinks deregulation will be trump's major program because inf infrastructure and tax cuts will be limited by deficit concerns. michelle we are approaching this moment when the promises of the campaign meet the realities of budgets, deficits and taxes in washington. >> and politics. >> and those are sharp elbowed realities. >> republicans don't like new tax. >> they don't like new taxes. larry makes a very important point, which i believe michelle caruso-cabrera has written about. it's very complicated. it's very hard to explain. and it pits business against business and right against right. why would you go about this? the reason i'm explaining this to you is the trillion dollars. it's a very painless way. by the way, a lot of democrats

would argue regressive tax. it's one -- >> consumption tax. >> to the extent it's done at the retail level. >> sales tax. >> yes, it is. >> but now larry lindsay is probably very angry watching this thing because he will argue it's all covered by the appreciation of a dollar in which it comes out of the hides of foreigners, mexican and chinese workers and their shareholders. >> we don't even know if donald trump supports it, by the way. we're working in a vacuum. >> he hasn't tweeted about it. >> he hasn't tweeted about it. >> that silence may tell you all you need to know. >> that could be true, too. i just wrote about it, causing a rift in the republican party. called forget about obamacare here is the real republican civil war, read it on power lunch.cnbc.com. thank you very much, steve. >> pleasure. a different border issue, president obama scrapping the so-called wet foot, dry foot policy which allows any cuban who makes it to u.s. soil to stay and then turning back those who found at sea.

cuban-american immigrant. we got him on to talk about this also because he is the host of something called the deplorables ball next week in washington, d.c. it's not one of the official balls. good to have you here. >> thank you, michelle. pleasure to be here and talk to your tv viewers. >> i want people to know something about you. when donald trump made a key speech right before the campaign in miami, you helped orchestrate it, occurred at the bay of pigs museum. you helped him craft the message, which a lot of people think helped to deliver the cuban vote and, hence, florida. what do you make of the decision by president obama last night to change the very privileged position that cuban immigrants had in the immigration process? >> well, you look at it as a double-edge sword, as a gift to the castros, but also maybe as a benefit, depending how trump uses it, for the trump administration t basically takes another feather off the cap.

there's two schools of thought. many cuban-americans have been there historically as exiles see that people come in and year and a day later go back to cuba so there's that resentment there. if you're fleeing communist owe pregnancy, how would you go back a couple of years later when you spent years and years to get out? that's one side. the other side is there's still dictatorship, murderous dictatorship over there. and we want an opportunity, especially the doctors and the talent pool that we are getting from different countries that come through these cuban doctors. so it really is very difficult. >> tom donahue is there today. we've seen hundreds of business people go down there and try to do business deals. are you supportive of that? should donald trump roll back the ability once he's in office for people to be able to do that? >> you, as business leaders and

commentators understand there is no economy in can cuba. you have a doctor making $20 a month there is no economy. i believe they're trying to get in early. but what my take is, we need to crow ate a system of multiparties and deal with the political prisoners and create a system within cuba that permits itself to be capitalist and a way you can invest and get your money in return. a lot of people are trying to see cuba, when it opens up and truly is free for its people will be an amazing market. >> tell me about the fluodeplors ball. sounds like a fun party. >> i call it miami, south florida meets washington, emblematic of what's going to happen from now on. a guy from miami with an idea, when people told me it was impossible because hillary was going to win. i said just put my name on there. it's amazing how a

cuban-american has this opportunity with his committee to take over for four hours on the 19th of january, the day before the inaugural of our 45th president and the the deplorables inaugural ball. it will be a party, absolutely. three bands, one from miami, one from nash vichlt have to do a little company. >> i want to qualify as a deplorable. >> i'm going to give you dancing lessons. i watch you every day. i watch you every day down there so -- >> i love that. thank you. >> four hours of fun and celebration of the new america. and we wrote a song, by the way. you're the first ones to know that. it's called make america great again. the song is gorgeous. we're going to debut it there. you're going to love it. >> i've heard the lyric. >> right. where did you get that idea? terrific. >> i'm going to plug you.

www.deplorablesinauguralball.com . we've got to do it. >> thank you, emilio. >> thank you. >> a lot of loud-mouth cubans in one room. that's redundant, by the way, loud-mouth cubans. why 2017 is the year of the bot. and why that should have us all worried. "power lunch" is back in two.

once in charge, tech companies heavily rely on for hiring. aditi roy has that story. >> trump's meeting with tech leaders. talking to execs about modifying the h-1b visa system, the same visas many tech companies rely on heavily to recruit workers.

currently 85,000 h-1b visas, run as a lottery and top five companies that use h-1b workers in 2015 are tata, infosys, accenture, wipro and cognizant. according to reports, trump's senior adviser steven miller wants to scrap the system. under the current program there isn't a requirement that companies recruit american workers for those positions before turning to the h-1b workers. we talked to howard university professor who has testified in front of congress on the issue. he believes the system needs to be changed. >> i would say the two sort of glaring problems are that, it's extraordinarily easy to pay h-1b -- legally pay h-1b workers much less than american workers

and it's extraordinarily profitable to replace americans or substitute for americans with h-1bs. >> we reached out to a number of tech companies about the issue and haven't heard back from any of them. back to you guys. >> thank you very much, aditi. more reaction on the h-1b visa debate with a professor of engineering at carnegie melon's silicon valley campus. what are your thoughts? what do you think we should do on this? you hear a lot of silicon valley companies agitating, begging basically that we open this program up so that they can get jobs filled. >> it's hard for me to say anything good about donald trump but this may be a good change he's making. five outsourcing companies taking all the visas. what this will do is shift the balance in the favor of the valley and allow tech companies that pay the highest for any

given wage level to hire the recruits this is a good move, believe it or not. >> this is a good move, open up sort of the free market for talent, right? >> exactly. >> that's your point? >> exactly what we want. let wages rise and let the best from all over the world compete with the best in america. this is what makes america great. >> let's talk about your second topic, an op-ed in the washington post that caught our attention. why 2017 is the year of the bot. the robot. why do you say that? what robotics and automation means for employment and job growth in the country. >> you know, if you try amazon dot or echo, people can have almost intelligent conversations with these things. artificial intelligence is now

on an exponential curve. the more people that use this, that have these devices, the more we're training the artificial bots and they're becoming more and more human like. we're 15, 20 years away from being like what we saw in the movie "her," samantha, following in love with her and so on. somewhere between now and the next two, three years, these things will become amazing. that's good and bad. good is that we'll have new friends and assistance and we'll have these devices that can help us. the bad is that they're going to get so smart that they'll be able to do the jobs of humans. >> i was talking to alexa the other night, vivek, and i was asking alexa what she thinks of siri. and she gave the most polite, kind response, which is really to your point. these machines can respond in sometimes surprisingly

compassionate way. >> siri has been left behind. the new bot generation are making her look like a child. getting smarter and smarter, moving faster and faster. >> thank you very much. we'll talk through our bots next time. >> all right. monster problem. high-budget movie disaster many say epitomizes what is wrong with that studio. that story, straight ahead.

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one of the movies opening this weekend has already been a monster headache for studio paramount at the time it could be a hit. julia boorstin joins us. >> monster trucks opens in hundreds of theaters today across the country. not only is it expected to bomb but anticipated to be such a disaster it's assumed to be the unreleased film that viacom blame for the record a $115 million write-down it took in december. they declined to comment. the idea came from a producer's 4-year-old about trucks taken over by monsters and delayed several times since its originally scheduled debut in december 2015. it reportedly cost paramount $125 million to make, even more to market.

now it's expected to bring in less than $10 million at the north american box office this weekend this comes as viacom, with newly appointed ceo, bob backish, and stock that's down struggles with its major movie franchises. "star trek and beyond" and latest "teenage mutantninja turtles" implies that they will have lost $500 million despite overall box office growth. they do have a few promising films "triple x" along with "bay watch" in may and "transformers" sequel in june. the bar certainly is higher for them as they try to crawl back from this disappointment. >> julia, thank you.

according to our next guest he expects the s&p to end the year 8% lower from here. what's behind that call? that kicks off in two minutes. antoe. amobiicil

hi, everybody. michelle is with me at headquarters, melissa is at nasdaq. brian is somewhere on a ski slope up in vermont. >> lucky him. >> we'll be here for closing bell at 3:00. this hour, big bank earnings are out. not enough to fuel the dow higher. why finding returns could be a struggle going forward. we'll talk about that. and you get called out, you get called in, you cut a deal. lockheed martin ceo at trump tower, announcing that the company will bring down the cost of the f-35 that had been targeted by the president-elect and that the company will also create more jobs notely in the dallas-ft. worth area. if you can't beat them, take a stake in them. animal rights group peeta.

another record high. check out some of the movers at nasdaq, maxim integrated, checkpoint. one of the biggest gainers in the nasdaq, netflix, upgraded from a hold to a sell. shares up about 2.5% today, up 7% today so far in 2017. netflix reports earnings next week. from streaming music to movies, pan dora, cutting 7% of its workforce saying fourth quarter revenue will be at its earlier forecast. here with me at the nasdaq. pick your poison. >> i'll go backwards. you started with pan dora. i'll start with netflix. reed hastings in his tenure from netflix has taken one, maybe two missteps along the way. here we are, approaching 52-week

highs. you mentioned the deutsche bank upgrade, from hold to sell. i'll bet you 5 bucks, no matter what happens after earnings, they raise it from hold to buy. >> already? >> because that's the way it works. >> within a week and a half? >> they can't go from sell to buy. >> because of compliance issues. >> still the call is bizarre. price target only goes up to 110, 22 bucks lower than where we are right now. >> i'm not sitting in the halls -- >> of deutsche bank? >> powers of deutsche bank. >> you aren't? >> they are praying like this that they come out, missed earnings, stocks sell s off, giving them an opportunity to sell the stock. i'm still a netflix bull. you mention eed pan dora. >> short interest. >> that stock goes up as well. >> back over to you, michelle. steve liesman has a cnbc rapid update. >> all the economic data folded into one piece of data for

everybody to track. it's unchanged at 2.3%. that's a victory, some major piece of data we got with the retail sales, holding up pretty decently at 2% for the quarter. after that,y sizeable number in the third quarter. holding up after doing 3.5%, holding up 2.3%. there's the range, 1.8 to 2.8, now estimated 2.3 with the first quarter. atlanta fed is at the high side on the fourth quarter. 2.8. barclay's, 2.2. morgan stanley at 1.7 and economics at 1.6. little detail on the retail numbers. christmas winners and losers. autos, great christmas. gas stations did well and nonstore retailers, your internet retailers inside that number. electronics and appliances did not do well. neither did department stores. i want to show you what a winning christmas it was for the autos. there you go. best month of the year in terms of year over year gains, 7.3% --

sorry, second best after february. 2016 was the best december for autos, percent of total retail sales since '92 and best december for autos in terms of all auto sales for the year. very good year for autos. i don't want to say they bought cars and not sweaters but that's kind of what the data looks like. >> throw in houses, too, with car. >> good point, and gas. lockheed martin ceo called to trump tower today, saying the company is close to a deal to cut costsn in the f-35 program. what does that mean for stocks going forward? john eade, thanks for phoning in. we do appreciate it. f-35 pretty important for lo lockheed martin. what could this mean for the revenue line at lmt? >> well, melissa, thank you for having me, for one thing. lockheed martin has several earnings drivers.

yes, the top line -- i think it's supposed to grow mid, single digits in 2017. so that may take a slight hit based on this news. the company has a lot of room to improve margins. i think earnings growth is going to stay on track. the company also has a sterling record of returning capital shareholders, buying back stock and increasing the dividends. i think the outlook will be okay for lockheed martin. >> ceo was all smiles, probably more positive than she had to be. how does that jive with the marilyn hewson you know and interacted with? is she a conservative person normally? trying to understand whether or not cutting some sort of deal on the f-35 with the president-elect might give lockheed cover for a bulk of its business, which is government contracts. 78% of revenues is government contracts.

>> well, that's true. 78% is government contracts. but about 20% of it is international. they're one of the more diversified internationally of the defense contractors. again, they still have that growth opportunity. back to your comment on the management team at lockheed, they're very conservative. they consistently beat expectations and raises guidance. so, to see a ewe meunique for ld martin because they're a conservative group. >> john eade of argus, thank you. waiting for dow 20,000. have been for about a month. our next guest says returns won't be easy this year. in fact, he expects the s&p 500 to end the year about 8% lower

than it is today. jeff hussy at russell investments. also with us is tony roth, chief investment officer at bloomington trust, who says the s&p will end the year 7% higher from here. we're going to get you to converge here and get you to agree -- no, not really. let me start with you, jeff. why do you see the market challenged as you do? >> sure. i think for us, it's in large part about where valuation is at. priced earnings ratios are very high. other metrics, stock market capitalize, gdp is very high. profit margins are very high and do tend to revert. we think those will be impacted by wage growth we're seeing and by interest rates rising. lot of financial engineering has led to higher earnings per share. people bought back their shares. valuation is a challenge. the other thing is a huge wall of money that is no longer there from central bankers. we think sort of the taking away

of stimulus, particularly in the u.s., less so in europe, will be a challenge just to the economy in general. >> but there are some indications -- there are some indications, are there not, jeff, that there's a huge wall of money in personal accounts, waiting to get put to work and some of it is or has been lately. can that counteract that? >> that's true. i would also say we have some of the highest debt levels we've had. everybody has talked about debt, demographics and deleveraging. we haven't deleveraged. i believe our economy is much more susceptible relative to the past when we didn't have as much debt. you just mentioned auto loans in the previous segment and the great sales we had in december. home loans. credit cards. don't forget student debt. they're all a drag on the economy and longer term structural issues that we think will be a headwind. i want to be clear. we think equities will do better

than fixed and cash, global equities. but we do have some concerns about the u.s. market in particular. >> tony, your thoughts? >> it's interesting. thanks for having me. >> sure. >> i look at a lot of the same phenomenon and see the opposite effects. as an example i view the monetary environment and normalization of such as very positive. we look at banks, insurance companies, pensions. these are all participants that will be actually aided by higher interest rates. on top of that, look at the fundamental inflation story occurring right now. was the inflation on the margin increasing, consumer sentiment quite strong, retail sales quite strong. that's all without additional stimulus from the new administration. if on top of that we have stimulus from a new administration, we could see gdp in the mid 3s as a whole. as long as we have a dollar that's not hurting exports, our base case scenario right now, we

see a good opportunity for equities. >> i hear guy wants to jump in. are you there? >> tyler i always want jump in. i'll ask a question question. i'm not sure whom i'll ask it to. in the environment we find ourselves in, what is the right multiple for the s&p 500? >> jeff, why don't you take a whack? >> yeah, i don't know. right now i've been looking at longer term in the 29 range, much higher than the average of sort of 18. it should be somewhere in that range. now you need to account for lower interest rate environment and all those issues. one could argue higher in the low to mid 20s. >> what is the pe and how does it differ from other calculations? but keep it in freshman english here. >> yeah. sorry, it's a ten-year average of price earnings ratios, looking at longer term ratios, very large correlation between

schiller pe's long-term average and subsequent performance. and that is one of the main tenets as well for our view that equity markets will be a challenge over the next three to five-year period. >> tony, what's your thought on what the optimal pe ought to be right now, given where we are? >> i don't think there's an optimal level. i think pe is an artifact of where we start and where the market needs to move in order to take into account the optimism we're seeing across consumers and other participants in the market. today when we're at forp of 17.50, there's plenty of room to move from the 18.50. you can take an industry or sector like the financials where we see easily a full 20% increase year over year in earnings per share and that actually allows us to get to the price targets without seeing the

rerating that i'm talking about. we look across more broadly at the equity market, there is room for rerating without it getting into the 20s. i don't think the pe will hold us up. >> we end it there, gentlemen. jeff, tony? >> trump wants to build a wall. some on wall street getting bullish on mexico. why? plus buffett's big bet on j big blue.

welcome back to "power lunch." one week before trump's inauguration. one thing on his agenda is building a wall on the u.s./mexico border. while he's building a wall, is it time to start building a mexico position in your portfolio? our next guest says, yeah. he just returned from mexico and thinks, yeah, there's a lot of uncertainty, but still some good opportunities in mexico. good to see you. >> good to be with you, michelle. zblie keep hearing donald trump saying mexico is going to pay for the wall. former president fox says they're never going to pay for the wall. i feel looer like they're already paying for the wall, losing jobs that were supposed to go there, defending billions against the peso that's getting hammered and yet you're pretty confident. why? >> michelle, you're absolutely right on everything that you said. the peso has depreciated about

17% just since donald trump was elected november 8. but look at the other things. the stock market has not budged very much. the stock market index peaked at 38,500 just before the trump election. it's about 46,500. it's about a 4% drop, not as significant as you would have expected. because i think domestically as well as international investors are taking the investments seen much more optimistically than i think the exchange rate alone would suggest. >> why? >> that's the first part. the reason for that is that the currency is taking the hit and with the currency taking the hit and the wage increases are clearly in mexico are going to be much smaller in dollar terms, and the mexican competitiveness has increased significantly over the last couple of years, yes, mexico will be hurt if nafta is canceled.

mexico will be hurt if tariffs are increased. however the benefit will bef after these things pass -- and i'm looking at the second half of 2017. you're look for a peso which during my stay in mexico city this week, we hit a new low of 22 to the dollar. but i think we are probably going to a 25 or even weaker later in the year. then if president trump were really tough on mexico, it will improve the competitiveness of mexican exports. note of caution, michelle, is that you need to have like a three to five-year time horizon if you're looking for good returns from long term but emerging markets are typically that way. >> hp me execute a trade here. the peso will weaken even further. so should i wait and then how do i do it? do i biomechanics can stock, etf? do i make sure it's hedged

against the currency? help me make this real. >> i think in terms of what you would do, i would wait for the trump inauguration. i would wait perhaps for another month to go by. by the end of february, you'll have a clearer idea of what the new president is going to be doing, how the mexicans are going to react to it. also one other thing to watch if you're concerned with mexico, michelle, is what action is taken against china and if there is a major trade war between the united states and china, then you are looking at mexico actually being in the shadow, getting the benefit of that war going on between the two giants and i think mexico will indirectly benefit from it, because he can't be as tough. the second half of the year, you go in, buy etf or biomechanics can fixed income. but i would say expose -- stay exposed in mexican pesos once you go and do not hedge.

you're looking at a very undervalued currency by then. >> very specific advice, sri. thank you so much. >> thank you for having me, michelle. good to talk to you. let's talk more about mexico in trade and mexican related stocks. still with us, guy adami and with us now, managing partner of fast money trader. half the desk here. >> great. great to be here. >> thanks for being here tim. >> we flipped. >> in terms of mexico you like the long term? >> currency is well past fundamentals. i look at the peso and where we were in the crisis, if you think about the precrisis pesos, at a peak. at its strongest point. post crisis about 11.5 as emerging markets rally back. everything was at its peak then. the move from 13 to 19 on the peso, to me, was all oil related. we're at a place where people

are pushing around mexico because of the oil reliance and the largest liquid currency in reliance. i look at companies group of mexico like a mining company whose cost are in mexican peso, exporting in dollars and a big play people watch and have always played in mexico that has done terribly is because regulators in mexico are on top of this, amx, telecom empire that has made tactical plays, dollar debt in their face. it's in the price of the stock. it's been massively downgraded. i would be looking at this stock now. the regulators are actually softening up on them. >> you look at stocks that are exposed to mexico and got whacked since the election. down or flat since the election as well. >> tim has talked about this as well. kansas city southern. take a look at what happened to that stock the night of the election. it was trading north of 90 bucs.

when it became apparent that mr. trump was going to win it trade below $80. it did recover. then what happened? ford made their announcement about moving out of mexico and the stock went right back down to 80. they report january 20th. they've had a premium valuation for years. which for a long time -- >> made sense. >> they deserved. now you have to wonder. interesting stock going into earnings. for the brave amongst you, i think there's a chance that they do beat them. whenever there's a quarter for them to beat it's this one. if you want to play it on the safe side, wait to see what they say, hope the stock does nothing and try to enter around the $80 level. >> build a wall or not, you can't tell me trade with mexico is over. >> but what if it's taxed? what if it's taxed? >> a lot of it may be. let's wait for that implementation. you can't tell me that the move in the peso isn't assuming massive border tax that will put a lot of these companies out of business. i'm of the view that, first of all, the trump part of the peso

trade has hit its peak. sure, could we go up to 22, 23? i think the worst is here. >> guys, thanks. tyler, back over to you. >> melissa, ibm on the cusp of a big milestone for its biggest shareholder. details straight ahead. speaking of shareholders, animal rights group peta is buying lmvh. we'll tell you why. if you think about it, you could probably figure it out. to! tereainia tlili llni'heom t 'giony arms

president obama will hold a news conference next wednesday, last one. last day he is in office or last two days he's in office. beyond the speech he made this last week that was his final address. but one more obama new s conference before he departs. i'm sure rick santelli will be paying attention from the bond market. >> michelle, fascinating day in the fixed income market. remember, we had a set of auction this is week, 56 billion, 310 and 30 supply. and in front of the weekend there's settlement. look at three-year note yields, 1.47 is about where it hovers.

on the day it's up two, on the week it's up one. almost unchanged. look at one week of 10s, up on the day, three on the week. if you bought the option at 2.34, seven bases points under water on the 30 year. those charts show you when we reach auction levels, we saw rates rise. as many sold that participate in auctions to protect or mitigate their losses and the market pretty much calmed down. i know equities are moving a bit lower. we continue to see the fixed income market still sort of in this growth inflation mode where rates go up and the stock market doesn't seem to be too adversely affected. finally the dollar index, see a one-week chart there. 20-year chart, take a big perspective here. right side still looks like there could be plenty of room and many investors think between the fed and potential for growth the room will be taken up.

melissa lee, back to you. >> rick santelli, thank you. ibm shares, and big blue's big turn around straight ahead. m ia toatstisy kekey,itilo. ce riru ?alorms llr est al.tefolmonarhy

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hi, everybody. i'm sue herrera. crews are working in front of the u.s. capitol ahead of next week's inauguration. a briefing regarding security at the event, homeland security. >> we, therefore, have done a lot to plan for public safety and security of these events to be on guard against acts of violence, demonstrations that get out of hand and to provide for a safe and secure presidential inauguration. >> heavy winter weather across oregon contributing to a train derailment in portland. a buildup of ice on the tracks causing a commuter train to derail.

no reports of injuries. and the green bay packers will be without one of their most valuable players when they play the dallas cowboys on sunday. wide receiver jordy nelson has been ruled out of the game with fractured ribs. he suffered that injury last week in the team's win over the new york giants. that's the news update this hour. i'll send it back to you guys. >> thank you, sue. i know this is painful news to you. >> it is, i'm a packers fan. >> as painful to you as it is to jordy nelson. >> high think so but they'll rally. i know they will. >> you are a big, big packer fan. >> i'm a cheese head. >> my son is a giants fan. >> oh, yeah. sorry, mac. >> i'll send him down to see you shortly. >> he's up in the office. i can tell. >> thanks, sue. >> sure. >> s&p 500 and nasdaq remain in the green. 2 out of 3, what you've got to settle for right now. nasdaq, new record highs. the dow down right now.

20,000 mark remaining elusive, as it has the last month. michelle? let's get to jackie deangelis at the cnbc energy desk. >> couple of factors we closed lower today well under $53 a barrel. bullish case for oil which clearly didn't take place today. confident that producers are committed to this output deal. yes, we heard that before. also slightly bullish, seven rigs came offline. on the bearish side, libyan production was up 50,000 barrels. that doesn't sound like a lot for last week. at the same time it flies in the face of what the secretary general said. and that is why we were in the red today. for the week, crude was down almost 3%. >> we're going to break in, jackie. donald trump, president-elect, is approaching the cameras over in trump tower. >> is that steve harvey? >> sure looks like it. >> everybody knows steve harvey.

everyone having fun? are you having fun? steve just came up to say hello. steve? >> mr. trump, can i ask you, sir, how concerned are you that some of your cabinet nominees are speaking on capitol hill on issues like russia, iran, the border wall and some of their statements contradict what you said in the snast. >> we want them to be themselves and i told them, be yourselves and say what you want to say. don't worry about me. and i'm going to do the right thing, whatever it is. i may be right. and they may be right. but i said be yourselves. wouldn't you say, steve? let them do t i could have said do this, say that. i don't want that. i want them all to be themselves. everybody okay? everybody good? thank you. repeal and replace is going great. >> well, that was mr. trump with steve harvey, the popular

television personality, game show host, talk show host as well as a nice shot of his tie right there. >> robert frank on the show to discuss different things. >> different things, yes. >> let's listen to steve, shall we? >> both transition teams, obama's transition team and trump's transition team and, uh, it was a really cool meeting in the beginning. we talked a lot about golf and things like that and, uh, people we knew and people in common, uh and they we got down to the crux of it. uh, he has introduced me to, uh, ben carson, now the new head of, uh, housing for urban development. and, uh, we've got to team up and see if we can, uh, bring about some positive change in the intercities, which i felt was my only agenda. and he agreed. and he wants to do something. and he realizes that he needs some allies in that department. and he seemed really sincere

about it. >> chicago being one. >> chicago is definitely one. another one they awant to start with as a target is detroit. ben carson expressed that. of course, quite naturally. he's from detroit. i want to do things in all of the major intercities to see if we can bring about some change and help some of these young people out. that's why i'm here. it was a successful meeting. and he seemed really sincere. [ inaudible question ] >> well, you know, it's not my jump into politics. i'm not going to pass a background check but i, uh -- it's just me following orders from my friend, president obama, who said, steve, you've got to -- as he told everybody -- get out from behind your computer, stop tweeting and texting and get out there and

sit down and talk. so i stepped from behind my microphone and i came and talked to the guy that's going to be the 45th president of the united states i did what i was supposed to do. [ inaudible question ] >> the transition team from president obama and the transition team from donald trump got me on the phone about a week or so ago. [ inaudible question ] >> no. i'll be turning 60 on tuesday and my wife is taking me far away. so i won't be at anybody's inauguration, because my wife said no. [ inaudible question ] >> the trumps being on "family feud"? yeah. against the obamas, that will be good. or how about the clintons? if i could set it up, that would be sky rocketing for the ratings. [ inaudible question ] >> i would, you know. i'm handling everything pretty good, you know.

of course it's an honor to be invited to talk. and i think that's the only way that we're going to unify our country. we've got to talk, you know. president obama said you've got to sit down and talk. and i really enjoyed the conversation. he seemed really sincere. he's a genuine person. >> do you have ni any lingering things you still want to talk about, values you're concerned about that you haven't quite heard that you want to hear yet or are you exactly on the same page? >> for this, we got off to a great start. it could be the beginning of something. for them to invite me here to talk about a specific problem and thought that i might be able to help, i know i got a big radio show. got a lot of people listening. i've always been concerned about intercity problems because they're huge. mentoring problem -- excuse me, my mentoring program has been part of this type of -- that's what i want to see happen. and they were spot on with it. and ben carson got on the phone. >> all right. steve harvey, the popular television host, making some news there, proposing the

possibility of a trump versus obama edition of "family feud." i'm not kidding. that is what he said, right? >> yep. >> interesting discussion that mr. harvey had in which he and the president-elect discussed, apparently among other things, the housing and urban development programs affecting the intercities, pointing specifically to what the president-elect and his team would like to do to help the intercities in specifically chicago and detroit. >> you said he's going to meet with ben carson. >> yes. >> in charge of housing and human development. it's also interesting that the obama administration is the one who orchestrated his ability to speak with donald trump. >> the obama transition team and the trump transition teams apparently reaching out to mr. harvey and there he is at trump tower, where so many people have come and gone in recent weeks. the federal government moves to repeal and replace obamacare. as they're doing that, state governments are looking at their own budgets and not all of them

like what they see. scott cohn is in the state with the largest budget, california, with a look ahead at the road there. hi, scott. >> a state that also has housing issues. and so they'll be look to thing i s like what you just saw. the road was going to be bumpy already because state revenues have been declining in some cases and leveling off and now comes president-elect donald trump and a republican congress. what will that mean? here is california governor jerry brown earlier this week. >> i'm not going to try to anticipate that. it's another reason, though, like the volatility of the revenue, that allegedly tries to be very prudent this year. >> brown has proposed $122 billion budget, urging legislators to hold the line on spending in the face of some big unknowns, like what will federal tax reform do to those already

suffering state revenues? will states get badly needed help on infrastructure? and the big one, of course, health care. in california alone, 6 million people gained medicare coverage under the affordable care act, including 29-year-old crlarice hill, who has a debilitating disorder. before she had to rely on charity for treatment. >> these infusions and any kind of insurance keeps me alive. and if i lose my coverage, i feel that i'm threatened to get all of my coverage through a hospital emergency room and that is not how to manage a chronic disease. >> reporter: it's not just california or the 38 other states that expanded medicaid. all 50 states have a medicaid program and there's talk of big changes in the funding formula for that. for now in the 47 states that are smack dab in the middle of their budgeting process, about all they can do is go based on

current policy with the knowledge they're going to have to be making some big changes very soon. guys? >> thanks very much, scott. certainly we'll be watching. straight ahead, billionaire seals the deal on one of the biggest homes in washington. and it's not the one you're thinking of. it's not the one who was just at the camera. we'll tell you the latest billionaire to hit the beltway hooer ahead here on "power lunch." hoe?stedtoto c h hmel.atcogesukos itnd st

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news just crossing from the supreme court about some cases that they're going to hear. many business related. they'll decide whether companies can force employees to give up their rights to bring class actions, dispute between novartis and amgen. they'll also review consumer usa holdings should be subject to debt collector law for collecting purchased debt and agree to weigh whether or not the s.e.c. faces deadlines for recovering illegal profits. wait, is there one more? i think so. certain securities class action claims are time barred as well, which make ace really big issue, getting somebody on the supreme court. there's so many cases that are so pertinent to the business community. right now it's deadlocked with one vacancy, tyler, as we all know. time for the power rundown.

we're bringing that one back with editor robert frank. ceo and washington post owner steve bezos is going to d.c., buying the largest house in washington, in the swanky calarama neighborhood where ivanka trump and the obamas also have homes. he paid $23 million in cash for the 27,000 square-foot textile museum. it was not always so swanky. >> nochlt it's swa. it's swanky now. interesting summer barbecues, obama, ivanka, now jeff bezos. most expensive home ever sold in d.c. and, you know, people just assumed it was one of trump's billionaire friends or cabinet members. and it's really jeff bezos. look at his real estate portfolio. main home in medino.

this 27,000 square foot is smaller. one in beverly hills for $24.5 million in 2007, three apartments connected in new york city and people don't know this. he he's one of the largest land owners in the united states with over 300,000 acres. he just bought a texas ranch a couple of years ago. and just a huge land owner. he seems like the kind of guy that wouldn't have a large lifestyle. he has some major properties. >> you said the century tower? >> yeah. >> i used to have a really tiny apartment there in the bottom toward the back. i had no idea. he had three. >> should have been next to his. he would have bought it for you at an elevated price. too bad. >> on to president-elect trump's move to separate his businesses from his work as president, raising questions about his billionaire status. is he still a billionaire? >> this was really interesting. a lot of the wealth indexes and lists have to figure out what happens when you put something in a trust. do we count that as wealth? the founder of ikea put all his

wealth in a trust so he would be removed from the wealth list. bloomberg and others said that doesn't count because you still control the trust and it's not irrevokable. basically you're temporarily putting it into a trust. let's be honest. it's not irrevocable. you can take it back. wealthy a-listers say trump is still a billionaire. we all know how much he cares about -- >> i never say he's not a billionaire. >> so i reached out to the trump campaign and said is he still a billionaire? and they have yet to respond. if you're out there, please let me know. >> activist shareholders. this could take that term to a whole new level. peta, louis vuitton and dior. they did a documentary. >> they did a documentary about crocodile farms in vietnam. >> peta did? >> yes, following the same

strategy with prada, aremis. one share of stock allows you to go to the shareholder meeting. they did this with aremis where they said we respect your concerns but these farming conditions strictly comply with international regulations because we want to comply with the best practices in the field. i'm not sure this gets them anywhere. it's a more practical way to get to the ceos than just picketing outside a retail store or something like that. look, these products are popular. you're not going to stop the flow of goods and the companies clearly have gotten the message and are trying the best they can. but it's a global supply network. you can always find some factory somewhere that may sell to a company that may not be doing the best practices. >> thanks, robert. >> thank you, guys. >> melissa? coming up, a special fast

money trading edition. stick with us. you're watching "power lunch." if an yi' if esits d st

jee well. welcome back to "power lunch." facebook, amazon leading the charge. what tech stock? >> what? >> not on the nasdaq, it's ibm. we have a special "fast money" week's trading nation. the reason we're talking about ibm is it's close to the level we're talking about the stock. it's closest to make a profit on the stock. stock is up 27%. >> 175 is the all-time high on the stock. we're getting back to the two-year high on the stock. what's happening slowly, the business is being transformed. the reliance on hardware and infrastructure, no longer. the problem with 2016 for the bears to load their guns is that this is really nonrecurring, nonoperating revenues that got these guys to 1350 a share. we still want to see this inflection point, if we will, in

terms of the cloud business. they are, i would argue, doing better than oracle because they have things like watson and the other new businesses along with their cloud apps that people are buying. >> we were pointing out that a.i., artificial intelligence, was going to give them the stability they needed. if they can make that business work, that will be the engine for this turn around. >> it could be. i've been doubtful until recently it's been the right way to be. the reason i was on ibm four or five years ago, they had vision. they knew what was going to happen. >> they would give a five-year forecast. >> they were right. they were spot on. >> and people challenged the company in the last couple of years that they were almost too spot on, that they were managing earnings and managing earnings expectations and it wasn't necessarily fundamental. >> very ge like. >> then the world changed for them. it changed extraordinarily

quickly. this is a company that probably has at best 4% eps growth, at best. i'm probably giving them a break. declining revenue stream. what's the multiple? it's trading close to 13 times. i understand the enthusiasm behind the stock. they report next week i think on the 18th. they better knock it out of the park otherwise the valuation that they see with 13 is going to be closer to cut in half. >> well, the multiple's about 11.5. 3.5 dip in yield. you have an environment where it compares to other megacap tech. even microsoft made the valuation argument for a company that slowly is dealing with t s this. i don't think the bar is as high into the numbers unless they tell us the core business is starting to make a profit. i don't see that reversing. >> you know what's interesting, when ibm's earnings came out they used to be a bellwether.

they watched them. ibm reported. that's it. >> what was old, what was new. you know who walked in here? you know. >> karen finer, the chair woman. >> the gang's all here. >> it's like the party. >> i'll tell ya. >> hi, everybody. >> you can see it. >> she has her pretty face. >> come on in. >> hi, karen. for more market insight head to tradingnation.cnbc.com. our final thoughts for the day. check please, ahead. and now the latest from trading nation.cnbc.com and a word from our sponsor.

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>> check please. >> check please. >> we're going to explain. well, hold on one second. steve harvey meeting donald trump today. that's got to be today's check please. watching donald trump. >> they were going to have a family feud he said between the

obamas and the trumps. >> melissa? >> i think the clintons and the trumps might be more personally. >> that's good. >> you could do clinton versus obama, too. >> yeah, could be good. there's a reason why all these guys are here with me. there's a couple more traders downstairs. it's because as you know we're celebrating our ten-year anniversary on "fast money." we're going to be ringing the closing bell in today's session. we're doing it. >> cool. >> the gang is all here to do that. tonight on friday's show, we have regis philbin, the legend in broadcasting and a trader and a "fast money" fan. >> regis is one of the greatest guys in television. one of the nicest men we met which leads me to what i did this morning, my son matt. wide shot here. i celebrated an anniversary, too, melissa. the 65th anniversary where my wife works as a producer.

today was her last day producing the final hour of the "today" show with kathie lee and hoda whom she dearly loves. >> there she is. >> mack and i got to come out and bring a cake and more champaign than i've probably ever seen in one place. i'm going to be expected to do this every day, bring cake and champaign for joanne lamarca mathisen. >> thank you for watching "power lunch." closing belle starts right now. such fun people. >> my congratulations. what a terrific lady she is. she used to work at cnbc years and years ago. great producer. she's going to do well. >> love her and tyler. welcome to the "closing bell", everybody. >> welcome back. this is kelly evans. she's getting her voice back here at the new york stock exchange. she'll be talking in just a moment.