business, right? >> brian's b is pretty big, too. >> not as big as his t. >> get to the rest. this has to be good. melissa. >> melissa, yes, melissa, i've got your number. melissa might seem hard as nails maybe sometimes, but she has a heart of gold. this girl cries at hallmark commercials. >> love that. >> nice, kathi, thank you. >> thanks for watching "power lunch." >> "closing bell" signed, sealed, delivered right now. >> big t. hello, everybody. welcome to the "closing bell." i'm kelly evans at the new york stock exchange. >> i'm bill griffeth. >> here we are. >> small handwriting means you're very introverted. that fits her perfectly there. >> ready to be psycho analyzed. >> what do you think? >> that's lovely. you could be on a currency. >> i don't know about that. my sixth grade teacher said i should be a doctor.

she couldn't read anything i wrote. >> the dow and s&p hitting highs. it's getting the first negative day in the semis. that's not the whole story. more on all on what's going on in the markets. president trump meeting with manufacturing ceos at the white house. they broke out into work groups to attack issues like trade and regulation. we'll tell you what came out of that meeting. >> and get this, a heart valve recall has sen shares of boston scientific lower today. we have the details on that and the fallout. that's horrible. i get it when you recall a device that's used on the outside of the body, but when it's implanted in the body, that's very tough. >> shares down 2.5, 3%. we'll have more of that. top story of the day on cnbc. u.s. treasury secretary steve mnuchin talking about what many have deemed the trump rally and what it does say about the

administration. >> obviously the stock rally has rallied since president trump took office and since the election and again since he took office. do you view that as a report card for the administration? >> absolutely. absolutely. i mean, this is a market to market business and you see what the market thinks. >> if the market were to pull back, is that just disappointment in the things not getting done as quickly as market had anticipated or do you expect -- you've watched the markets for a long time or do you expect things to pull back? >> i've always been focused in the markets on not day trading and where they are day to day. whether the market goes up or down on any given day, i've given up figuring out why that is. >> smart man. >> you know, but do i think that, you know, over the course of the year we're in an environment where there's very attractive investment opportunities in the u.s. and i think that's reflective of the administration's goals and what the market thinks of it. >> well, joining us with their reaction right now in our "closing bell" exchange, peter

anderson from venuciary trust and steve bliss and rick santelli checking in from chicago at the cme. keith bliss, we all know it's been an impressive rally since election day. there was a pause in january and then it's been off to the races again in february. what do you think the market has been responding to? >> well, it's tough for presidents to really lay claim to market rallies, but most of them will do that when the market does move up. barack obama did it, i recall ronald regan did it and certainly donald trump is doing it now. i think this one is very different. you cannot ignore the fact that since november 9th i just looked at the data before we came on, the dow is up 13%, the s&p is up 13%, russell is up over 16%. a lot of that has to do with the anticipation of the big four things in the economic policy proposal. taxes, infrastructure spending and whatever they're going to do on trade.

certainly for u.s. based companies we'll see how that happens. again, i always hesitate to give presidents or administration officials, they have very little to do with the economy other than policies coming forth. it's hard to argue with the rally for good or bad, for reasonableness or fact-based rallying, it is happening because trump is in the white house. >> peter, do you agree with that? >> just to build up on the report card, we are just in the first quarter of grades. it takes an entire year to figure out what your cumulative grade is. the thing that is really puzzling to us is you have this low volatility but the market's taking off and a lot of people need a roadmap. how can you have low vol and equity in the markets. what we think is unstable equilibrium, that right now there is a rarity where you have the negatives actually balancing the positives. all the things we've talked

about, earnings growth, et cetera, free trade but then that's balanced against geopolitical risk and president trump's rather unusual style of communicating. everybody's trying to get calibrated to that. when you add it altogether it adds up to low volatility but it's unstable. and if any of those policies change, then we think that that instability will move and you'll have an increase of volatility. so i would be very, very careful right now because i don't think the stability is going to last very long. >> rick, we sort of had this conversation yesterday but, you know, the equity markets have responded tremendously, but the markets that you cover in fixed income and the currencies have been just marking time here. the dollar took off initially but that stalled. yields have been fluctuating within that range again. what do you make of the markets during the time that -- after the election and during the first month of donald trump's presidency? >> well, let's keep that wall. i like what you're thinking.

let's keep the currencies and the fixed income on one side, let's talk about equities first. you know, i agree with how secretary mnuchin described the report card metaphor, but i think it's a bit deeper than that. if it were the house republican and trump and the senate was democrat, i don't think the report card would have been as good. once again, you win the world series, you have to have all three. you need pitching, you need hitting, you need fielding. i think it is a package report card. on the other issue, let's go to the other side. i think there are so many reasons for global investors to look to our treasury market as something they want to invest in, look no farther than japan, negative rates. europe, negative rates. that's an easy one. there's a lot of channels of treasuries, and i think those associated with the house, the senate, the president, that package is a growth package. that's more apt to push rates up, but it isn't the only channel. and i think with respect to the dollar, a lot of issues there, the same as the bond, but i

think the one to focus on is whether we get a back tax or not. a lot of speculators have gotten in front of that trade being long the dollar. it's different than hanging out in stocks. i think the dollar index especially with some of the volatility in the euro currency with their negative rates, that is the wild card on the dollar. remember, the dollar is still like treasuries, down on the year. it's down on the year in yield and treasury prices are higher than they finished last year. dollar index prices are lower. >> peter, i was going to ask you about the wild card, about interest rates. what do you expect here? do you price in that they're going to move higher or do you think we're looking at the status quo? >> well, you know, remember, even in her -- the notes that she released yesterday we were all focusing on the prospect of raising rates and i do think that's a possibility, however, she actually mentioned the fact of this low volatility and that

is even worrying the feds. so now that's actually creeping into other centers of influence, and i do think that that might actually cause the fed to maybe pause in terms of rises interest rates. now we're also seeing by side experts now commenting the new narrative that's creeping into this is maybe rates have gone too high too fast and we've gotten ahead of ourselves and we really need to recalibrate. some are actually saying the treasury might hit a 2% rather than a 3%. so i think that is showing it's endemic of how uncertain everybody is and i also think a lot of viewers are just looking for a baseline in terms of what do i do with my money now. >> right. >> what's the future look like for the next six months to 12 months and that is a very difficult question to answer right now. >> well, as we all know, the baseline keeps rising. the dow looking at its tenth

consecutive up day. thanks, guys. now steve mnuchin's interview had plenty of focus on tax reform and on its economic impact. here are some of the highlights. >> our economic agenda, the number one issue is growth, and the first, most important thing that will impact growth is a tax plan. that's really our focus. we want to get this done by the august recess. we're looking closely at the issues on the border adjusted tax. i have spoken extensively with paul ryan and with chairman brady on this, and we're looking at it. we think there are some very interesting aspects. we think there are some concerns about it. i this i there's a rule. i think during my confirmation it got named the mnuchin rule so i was very keen on that. we're primarily focused on the middle income tax cut and simplification for business, and what we are focused is that on the high end if there are tax cuts, that they are offset with reduction of deductions and other things.

we're not ready to make any formal announcement on whether we are going to have a 50 year or 100 year, but i have said this before. i think it's something that we should seriously look at. i've already begun to talk to the staff about looking at that. >> we have a lot to talk about here at post nine with this group right here. senior contributor, larry kudlow's with us. roger altman, robert frank and ylian mui checking in remotely from washington, d.c. you're going to take credit for the 100 year bond? we were talking about the possibility of a 50-year bond? >> you could put your little toe in for 50. >> right. >> you can do 100. i said this for a long time. i wrote it for cnbc. it doesn't solve your debt problem. it does, however, really help your debt service expense problem and you've got rates around 2%. i don't know if the average maturity is only about 60

something months. i think the average rate is whatever it is, 2%. >> do you think there's a tax plan -- do you think their tax plan will be debt neutral, revenue neutral? >> i don't know. i don't really care. never have. >> really? >> growth is the key. i love mnuchin on this point. they're sticking to their guns on 3 to 3.5%. i like that. that's what tax cuts are going to do. i have only a quibble with steve mnuchin, that is this business of getting it done in august is very iffy. >> yes. >> he's right that the business tax cuts are the biggest growth. i agree. so do those first. >> right. >> do those first this spring or else do them with health care, but don't wait because you know what? august becomes december, december becomes next year. >> roger, what do you think about the time line as it's evolving? >> i think it's dubious that there's going to be comprehensive tax reform, emphasize reform. >> at all? >> no, reform now. broad-based 1986 reagan-like

reform. on the individual side and the corporate side. can they succeed in, for example, lowering the corporate rate? i hope so. we need that. but broad-based reform of the type that it took two to three years to do in 1986, i really doubt it. he talked today as larry just said about august. i don't think they're going to make that. if you look at the george w. bush tax cuts, the bill clinton tax plan, the reagan tax cuts, they were already on the table at this point in those administrations. and i think they're missing the window. part of it is the priorities they set and the first priority they made clear on is the affordable care act, the obamacare, and they're struggling with that. i'm skeptical that they're going to proceed on it. it's consuming a lot of time. they're late in doing big reform, i want to emphasize that i'm not talking cutting in rate or that rate, but big reform, is late. >> john boehner said that he

predicted that a full repeal/replacement of obamacare is not going to happen. he started laughing when he heard president trump and the republicans promise swift action on undoing and replacing the health law. he said, quote, republicans never, ever agree on health care. >> yeah, well, boehner knows a thing or two. roger makes many good points here. look, i would split off the business side from the big package. >> i agree with you. >> business side has a big bang for their buck. >> including repatriation. >> lower rates, expensing, et cetera, et cetera. get that done. that's the growth propellant. don't wait. if you had to, i'd put it in with health care, but i don't -- just get -- see, steve mnuchin's got the story right, it's the legislative strategy that worries me so much. >> they're in more trouble than it appears on the surface. i mean, taking boehner's comment, but i made the same

point, i don't think the repeal of obamacare is going to happen. and then as i said, they're late on this. you would have to be a real optomist to think they're going to get reform between now and august. history tells you that big change takes place in the first nine months before the august recess. if they miss that window, this is why larry's point about splitting off corporate tax reform is a good one. >> can i raise two other points? >> let me bring the others in here. we have to spread this around. the mnuchin rule, he wants to see on the wealthy side, which is what you cover, a tax cut for them has to be offset by a reduction of -- any deductions that exist out there. >> to roger's point about just how tough it is to deal with tax reform broadly, so mnuchin rule is so central to his last cnbc interview where he came out uncategorically said the taxes for the wealthy will not go down. they will be offset by eliminating loopholes. mathematically that's impossible.

it's just not possible. this morning he sort of tiptoed around it but basically said i stand by that comment but the details have yet to be determined. >> what do you mean mathematically impossible? >> when you bring the top rate from 39.6 to 33, you reduce capital gains, you ee lame nate the amt, all the deductions in the world even if you eliminated charitable deductions and you eliminated the mortgage deduction, imagine that happening, those numbers never come close to what you lose by lowering the rates and all those things on the other side. >> i don't understand -- >> by the way -- >> let me add one thing. >> why is this important? >> exactly. >> lower the rates and broaden the base and do the best you can to flatten it out. >> hang on. ylian is jumping in. >> i'm here in washington where the action is actually happening. they have a flul there which is not the mnuchin rule but the byrd rule. that is the rule that requires any budget done through the

reconciliation process to not axe the deficit out of the ten-year budget window. doesn't matter what tax cut you're giving, but it cannot get it out of the ten year window or else democrats get on board. i'm still not sure how the administration plans to pay -- >> with the greatest respect, i must push back on this point on reconciliation. the byrd rule is sometimes used and it is sometimes not used. very important. in a bipartisan way. i'm not blaming, i'm just saying there's no constant with the byrd rule. and the whole point of this exercise is not to worry about tax rich people and the byrd rule and all of this, it's to grow the economy, okay? that's the key point. >> how do you pass tax reform if you can't increase the deficit? >> growing the economy through deficit -- through deficit spending actually, you know, come back and bite you in the end of the day. >> but this is why -- this is why secretary mnuchin talked about 3% growth and dynamic

scoring. it's pretty clear based on his comments that they're going to put forward a plan which assumes a very high growth rate reflecting dynamic scoring. in other words, tax cuts produce growth and that produces revenue so it's actually revenue creating, not revenue reducing, and that's how they're going to figure out a way to present it as satisfying the reconciliation requirements. >> i'm all in. >> how big does that growth figure have to be for losing a trillion dollars. >> you're not going to lose a trillion. >> he's talking 3 to 3.5%. the difference between the imf forecast or whatever you want, 1.8 and 3 to 3.5 is huge, massive. >> roger, if you're just talking about business tax reform, these numbers are not nearly as big. and in many cases business tax reform actually pays for itself. >> you're right. >> in four or five years. that's all i'm talking about right now. can i just change this a bit? >> let me bring this up a bit. lost in the sauce is what we were talking about up to this point, it was sort of a footnote

in the interview today, ylan, that would be the border adjustment tax and he didn't commit one way or the other. >> right. the reason why the border adjustment tax is so important to tax reform as a whole is because it's the pay for, right? even donald trump's tax plan that he issued during the campaign has already been dynamically scored. the conservative tax foundation has the most mobile estimate still estimates it would cost $2.6 trillion over a decade. that's the low figure. tax policy center has a figure that's closer to $7 trillion. again, how do you pay for the plan? how do you make the numbers add up? if you don't do border adjustment, what's it going to be? >> i think that mr. mnuchin's response to the border adjustment tax today, if he didn't bury it, it's three feet under, all right? well, we're looking at a lot of options, we have concerns about it. that's the way i read that. here's the good news. hang on one sec.

mnuchin said as i heard it, there will be no war between the white house and janet yellen. he said, we acknowledge that interest rates are going to go up. >> she's dovish. >> in the campaign there were wars or many wars. so he basically said, we're okay with what they're doing. secondly, he said, with regard to currency manipulation in china, he said, there will be negotiations. i like negotiations. that's much better than a trade war so those are positives. >> roger, you know you have to jump in sitting next to him. >> i was going to say, keep in mind if obamacare -- if the repeal of obamacare doesn't happen, and i predict that it won't, obamacare is actually a revenue razor. it raises substantial revenue. right now the trump plan is we lose all of that revenue from obamacare, we have to replace it. they probably will end up with that revenue so their task in terms of the growth rate, the dynamic scoring is a little bit lower than you would think on the surface. if you think obamacare is sticking around, they still have the challenge but it's not as big as it looks. >> finally, robert, he is now

calling this mnuchin rule thing. you're saying it can't happen the way he's described it. how does that fit into all of this? >> look. the overall point is that the tax code is so interdependent on other pieces of the tax code. i agree. to just pull out the corporate tax rate and lower it to 20, 25 -- would be wonderful. that results in all of this income flowing from the individual side through the corporate side and as we learned in the reagan tax reforms these two things to often get true reforms have to be done together. >> you can, larry? >> kevin brady -- >> i've only got one second. >> he said in his speech to georgetown, you can accept personal from business income. there's a million tax lawyers to do that, and i just want to say this, if you lower the corporate tax rates, the small businesses owner operated, llcs, all right, they may not get all of it, but they're going to get a large piece of it, and that's why in

many ways this becomes a middle class tax cut. >> isn't that the estate tax for the small businesses? >> yes, i like that. >> that's where they get the best benefit. >> one of the things i like about this whole package and this whole discussion is the solution is growth. growth. don't forget growth. roger altman believes in growth. >> i do. >> we may disagree on specifics -- >> he's correct. when he says our core strategy is growth, he's correct. >> give him some credit. give him some credit. >> he's a growth guy. clinton was a growth guy. >> once again, i have to be the adult and stop everybody at this point. it's been a great discussion as we knew it wok. thanks, everybody. the mnuchin interview today. we have less than 40 minutes to go into the bell now. take a look at the dow. up 52 points. this would be the tenth straight record close for that index. we haven't seen that in who knows how long. jobless claims moving at a 43-year low. so we're already talking about

some pretty good levels. the s&p is up 2 points today. lower yesterday. the nasdaq and russell are lower by about .4, nearly 2/3 of a percent respectively. >> you saw live on cnbc earlier. president trump meeting with ceos of the nation's leading manufacturing companies. we'll go live to the white house for some of the key take aways from that meeting coming up next. tesla's under pressure after announcing the wider than expected quarterly loss. the departure of the cfo. stock down 6% now. you're watching cnbc first in business world w50id. worldwide. the future of business in new york state is already in motion. companies across the state are growing the economy, with the help of the lowest taxes in decades, a talented workforce, and world-class innovations. like in plattsburgh, where the most advanced transportation is already en route. and in corning, where the future is materializing.

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he's got a recap of the highlights today. eamon. >> bill, that's right. i had the opportunity at the white house to go in and be a fly on the wall inside some of the breakout sessions here earlier in the day. sometimes these things can be feel good sessions, but there was some real debate in there.

at one point i saw two ceos arguing about the border adjustment tax. one ceo said it will create 2 million jobs and the other one interjected and said, yeah, it will threaten 42 million jobs sob careful what you ask for there. we saw the president making some comments that you don't typically hear from the president of the united states. take a listen to this comment on the dollar from president trump earlier today. >> there's nothing like what you do, the caterpillars are the best and when we raise the dollar, we let other people manipulate their currencies, it's the one thing that stops you, doug, right? >> we'll take them on. bring them on. >> technology -- no, we have to give you a level playing field. we have to let other countries give you a level playing field. >> so you guys can interpret that as you want, but to my ear that sounded a little bit like the president was suggesting that a strong dollar could be bad for caterpillar in terms of the exports that the president's trying to encourage here.

that's not something you usually hear from presidents. typically treasury secretaries say the united states has a strong dollar and that's our policy, but here you're seeing a little bit of a shift here on the part of a white house that wants to emphasize exports over imports so something different from president trump today. >> eamon, thank you so much. 34 minutes left in the trading session. if you're just tuning in, here we go again. this could be the tenth day in a row for the dow to rally and stay in record territory. we're up to 20,824 right now. >> check out this reversal. tesla shares were higher after hours yesterday after reporting its earnings. now they're down almost 6%. would he'll tell you why when we come right back. with e*trade you see things your way.

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welcome back. dow is hanging on to a 37 point gain. take a look at shares of square. they are surging on the back of a smaller than expected quarterly loss and better than expected revenue. shares up 13%. volume jumped more than 34%. barclays and piper jaff ry raising it from 15 to 15.50. it went public at $9 a share and has nearly doubled. meantime, tesla has gone into reverse. lower today with the electric automaker reporting a wider than expected quarterly loss. 69 cents a share versus the street loss of only 43 cents.

revenue did top estimates. tesla said the model 3 sedan is on track for volume production by this september, but ceo elon musk kicked off last night's conference call with this headline grabber. >> our cfo has decided to leave tesla in april, the ind of next month, to pursue opportunities in public policy. jason will be replaced by a gentleman that's been with the company for seven years before stepping away in 2015. >> mr. wheeler took the cfo job a year ago taking that job from hoosia who is coming back to replace him. here's what musk had to say about his own longevity at tesla. >> i expect to remain with tesla essentially forever unless somebody kicks me out so that

remains my intention. >> as mentioned, tesla shares are weaker as we move throughout the session today. for co-workers here comes the cobots. julia boorstin has the latest in the disrupting work series. >> reporter: kelly, blooming fears about robots taking our jobs, we should get used to working with them. the market for collaborative robot toiks is expected to reach $12 billion by 2025. we'll see cobots across industries, not just manufacturing. people will be working with robots in places like hospitals where they're doing tasks such as dispensing medicine. they need to show a robot what to do, everything from building cars to teaching in classrooms. and a range of robots tackle automated checkouts and customer service. hardware store lowe's lobot speaks multiple languages and knows where everything is stocked. >> at lowe's no one has actually

lost their job. the people who work there are still doing their jobs but they're spending less time answering sort of simple questions about where things are and they're spending more time helping people, for example, make better choices or design kitchens or do more complex things. >> a range of companies are looking to cash in. there's boston dynamics which google owns. piaggio made a room of robots to help carry your stuff. it's not all about collaboration. robotics will result in a 7% net job loss a year over a decade. according to gowanger. that includes a gain in robot to being jobs. back over to you. >> wow. julia, thank you very much. would you rather work with a human than a robot? >> i'd rather work with you, period. >> same here. >> how about a clonebot. never mind. elon musk says he's going to be

there forever. he'll need something like that. 27 minutes left in the trading session. the dow on track to be in record territory for a seventh strayed day. up 41 points. boston scientific down after the medical provider recalled a heart valve device. we have details coming up. earnings from the gap, nordstrom and hughlett packard will be down. stay with us. you do all this reh

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>> why not? there's nothing to stop us. we see the sector rotations. that theme is still in play. the dow has out paced the s&p and the nasdaq the last two days. we're seeing the rotation out of the nasdaq today. >> let me ask you about the behavior on the dow. there are reasons why due pot yesterday, is it possible everyone is piling into the dow etfs and that's contributing to that performance? >> yeah. that's a best way to get a cross section of what the economy is doing. when you see president trump meeting with the ceos -- >> won't that get the s&p 500? >> it's sexier. you're going to see 21,000 and down. you'll have performance base. that's what they're doing. it's clearly a rotation. >> we were talking about the time lines for corporate tax slipping and doubting obamacare happens. what if this is all riding on hope and plans that can't be delivered? >> the old adage is buy on rumors and sell on news. if the news doesn't happen or until it happens, you're going

to keep buying them. you're going to hope you get better performance or better expectation than you might get at the end. that's why you're going to sell it. you're seeing hedge trade come in. gold rallying. i was talking with a colleague of mine. he said it's breaking out and there's no up side, you know, to stop it. >> no stopping it. interesting as the dow moves higher, too, matt. bill? >> all right. time now for a cnbc news update with contessa brewer. >> reporter: hi there, bill. here's what's happening now. secretary of state rex tillerson and homeland security john kelly are meeting with their mexican counterparts in mexico city. this came amid mexico's unease over president trump's immigration crackdown. >> we universally agreed on the importance of strengthening institutional mechanisms. the meetings were the continuation of a purposeful and productive exchange that is setting our two countries down a pathway to greater security and

long-term prosperity. secretary of education betsy devos is speaking at the conservative political action conference in maryland. she told the conference her main job as education secretary is improving learning for students. a small gas station in lafayette, indiana, has sold the $435 million winning powerball ticket. the winner is still anonymous. we don't know who it is. if you can believe it -- well, i don't even want to give this away. this seems remarkable. more powerball winners, 39 in all, have come out of the hoosier state than any other state in the union. that means more than california and more than florida, which was my original guess. more than new york. indiana has produced the most powerball winner. >> who knew, the hoosiers? they're cleaning up in the lottery. >> who knew, hoosiers. >> great stuff. thank you very much, contessa. >> you're welcome. somehow we're hearing kelly

speak here but we don't need that now. i think she's discussing -- that's okay. no problem. where were we? we have 20 minutes left in the trading session here. the dow is up 30 points. shares of boston scientific are down today on word that it is recalling one of its heart valve devices. we'll have details on that. plus, our own version of the dynamic duo. it's zok and block. bringing truth and a profitable way to your portfolio.

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boston scientific lower on word of a recall announcement for a heart valve product of all things. >> our meg tirrell joins us from cnbc headquarters. >> reporter: boston scientific is down on this that it's recalling its lotus heart valve system. for patients with the heart valve implanted, the company says this doesn't affect them. they're saying don't implant anymore. that's because the recall has to do with the delivery procedure, the actual implantation of this heart valve device. these are known as trans cath ter aortic heart valves. jpmorgan says $2.5 billion in

2016. expected to grow to 5.5 billion in 2021. it's a minimally invasive way of implanting the heart valves versus doing open heart surgery. it's a competitive marketplace. it's dominated by edwards and medtronic. this is what's being recalled. boston scientific is down on this news. medtronic and edwards getting a tick up because of competition. as they absorb this news it's not as big of a financial hit as they anticipated. they're down a few percent whereas earlier it was down almost 10%, guys. >> wow. >> you know me, i'm a slow learner. the heart valve itself is not defective. so the guy that -- the person that has the heart valve implanted already, they don't have to worry, but it has to do with delivery of the valve into the body? what did you say there? >> yeah, that's right. i've been learning about this today. the way they implant the heart valve essentially, they say there is an issue with when

you're actually putting the valve in you use a catheter to insert the valve into the heart. there's a problem with that procedure. they heard a number of reports from doctors that there were issues while implanting the device. they said this is too many reports of this. we're going to stop putting them in for now until we figure them out and get the manufacturing straightened out and start selling them again in europe in the fourth quarter. this isn't yet approved in the united states. this did push back the time line for seeking approval here until later this year as well. the company also earlier, a couple months ago, had withdrawn another version of this in europe. it's sort of the same problem. they say they've got a handle on that, they're just wrapping it together. >> all right. very good, meg. thanks very much. meg tirrell. we have a news alert. >> reporter: president trump just gave an interview with reuters in which he talked about the border adjustment tax. he weighed in saying, quote, it could lead to a lot more jobs in the united states.

he talked about the time line saying that he wanted to tackle tax reform after doing the repeal and replacement of the affordable care act. he said the border tax would encourage companies to come back to the united states and build factories here. we have the interview with treasury secretary steven mnuchin in which he studiously avoided saying anything one way or the other in regard to the border adjustment tax. now you hear president trump coming out and seeming to speak in favor of some of the benefits that the border adjustment tax could bring. >> on that note we should show what's happening with the retailers digesting this news. jcpenney appears to be one moving lower on it. there's two different pieces, the border adjustment which you've been talking about, the corporate tax. the border tax itself is a different piece of this, correct? so it's very possible to move forward with a pure tax like that while not doing anything with adjustment? >> reporter: that's right. border adjustment is a tax that would raise the cost of imports

while lowering the cost of exports. we're not exactly sure what border adjustment means but he did talk about slapping double digit tariffs on goods from mexico, on goods from china, perhaps as much as 45%. is that what he means when he's referring to border adjustment? still unclear but the language he used today in the reuters interview saying the border adjustment tax could lead to more jobs in the united states. that seems to say he could be weighing in in favor on this plan from republicans. >> look at macy's, jcpenney and others that rely on those imports. that may be a problem for them. ylan, thanks. >> 12 minutes left here. we have the dow up 25 points. record territory again. "closing bell's" market crusaders zock and block swooping in to save this trading day when we come right back. wha? hey gary. oh. what's with the dog-sized horse? i'm crazy stressed trying to figure out this complex trade

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nine minutes left in the trading session. art cashin stopped by and said the market on close orders have paired off so there's no imbalance to the buy or the sell side right now as we head towards the close with the dow

up 23 points in record territory. >> there we go. >> now it's the next edition of the cape crusaders. they're back again. zock and block with us here on "closing bell." that would be joe zock from tocqueville asset management and michael block from rhino trading partners. >> which one is batman, which one is robin? >> we'll leave it up to you. >> you can draw straws and see who does this. what do you make of this rally that we've seen this month of february? very impressive. record territory. how much longer can it last do you think? >> we're starting to see some cracks. i'm seeing that the banks have stalled out, industrial stocks and metals. some had to do with the chatter that the infrastructure bills may not be coming until next year. trump administration get taxes out of the way, health care, a lot of other things. this has put off and hit the stocks. however, what we've seen is like a rugby game is going on. a big keep away. you can almost picture it where news sectors are coming into leadership.

energy, utility. not just a bond proxy. >> i don't know if you want to see utilities leading the market higher. >> earnings growth year over year has been better than any other sector. >> warren buffet sees, i get it they're a good investment. they're not the most cyclical. >> the point is there has been an orderly progression among sectors. it's healthy. >> let me ask you, joe. you mentioned the infrastructure being pushed off. copper did suffer. we started talking about how tax reform may not happen right away. obamacare may not happen at all. now we're saying infrastructure. is that why we're starting to hit the skids in this market? >> that may be the reason in the u.s. market. our attention has been turning to global markets, particularly european markets. the average fee pe is 14 compared to 18 for u.s. markets. number two, sentiment. there's no question that there's an attractive allure that u.s. markets have imposed on investors. people want to be in this market. number three is the headline

risk. european investors have returned from the brexit, there are a few more elections. we think the valuations and those markets are more attractive. they're in the same business as the line between u.s. equities and global is very blurry at this time. >> johnson controls is an example of one you like. they're based in ireland. what may be affected by any border taxes or any trade strategies out of the trump administration? >> there are two risks there. integration risks. they combined with tyco and the currency risk. a huge portion of their business is aimed at china. we're not really sure what the regulations are going to look like, what trump is going to do to imports or exports or currencies for that matter. so there's a great mystery. what we do know is the balance sheet is solid. they're the leader in all of their industries. they've shed the losing industries. we think it represents value. >> how much higher do we go do you think? >> i think we're bumping up against it. we're seeing weakness in the russell. i see the leadership hand it off. we keep rotating.

a week ago it was industrials, now it's health care. a week ago it was tech, now it's energy. there will be this impetus for saudis to keep the oil price stable to make sure the ipo gets done. that could help sentiments in stock. >> a helpful reminder that you can take your dvr and reverse that back and listen to michael's answer to that question. it was very instructive in slow motion so you get all of the information. >> you said it. >> zock and block. thank you for joining us. >> thank you also to students of washington university for coming by to visit today. >> great tour. big group from her alma mater. >> we have the closing counter in a moment. after the bell, treasury secretary steve mnuchin making headlines on everything from taxes to deregulation. our all-star panel includes former obama administration allison goolsby has full analysis. you're watching cnbc first in business worldwide.

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you have access to the right information at the right moment. ♪ ♪ and when you filter out the noise, it's easy to turn your vision into action. ♪ ♪ it's your trade. e*trade. ♪ ♪ inside the two minute mark. here we go, the dow. minor gains but it's enough to keep us in record territory. using the baseball parlance, they're hitting singles, not home runs, but it's still enough to win the game. the dow up 22 points right now in record territory. wti, crude oil still very

volatile these days as they try and figure out whether these production cuts by opec are going to be enough to raise the price. it's been fluctuating in the trading range. we're still stuck in the 53, $55 range on wti. bob pasani, late today with president trump giving an interview to reuters on the border tax. he's talking it up even though treasury secretary steven mnuchin was not committing to the border adjustment tax. with the president talking it up we see retailers like jcpenney's and macy's down. >> urban outfitters, all of that has been down. i think the border adjustment tax is in trouble but there's a lot of debate. we saw industrials weak on the day. mr. mnuchin didn't seem to put the order right. he put individual tax reform and then corporate tax reform. the market said maybe this order

is not quite right. companies that benefit the most were down a little bit. we had problem in the morning and turned it around late in the afternoon. >> it's enough to put us in record territory again. number ten in a row for the dow up 27 points. stay tuned. a lot of earnings coming your way on the second hour of the "closing bell" with kelly evans and company. see you tomorrow, kel. thank you, bill. welcome to the "closing bell", everybody. i'm kelly evans and we are finishing with a tenth straight record close for the dow jones industrial average. 33 points higher to close above 20,800 for the first time now. just incredible to watch this one keep going. s&p 500 which was down. the dow was the only index higher yesterday. it's continuing its winning streak with the 33 point gain. the s&p turned back into the green albeit only by a point to 23.63. the nasdaq and russell meantime

continue to skid today. the nasdaq dropping almost half a percentage -- half of 1%. 5835 is the level there. the russell 2000, the under performer as we often see on days like this dropping 2/3 of 1%. 1394 for those small caps. we'll have more on these markets in a moment. president trump and republican lawmakers have proposed to repeal and replace obamacare, but as congressmen met with their constituents across the country in town hall meetings, people are demanding to know what the future of health care will look like. republican representative tom cole will join us with his take on his party's plans. and joining me today in the meantime, cnbc commentator michael santoli. welcome back. brian belski at bemo capital markets and stephanie link at tiaa investments an affiliate of nuve. great to have everybody along. mike, what does it simply mean, just this alone, that the dow has now been up for ten straight

days at new record closes each time? >> it mostly means that this has been a very persistent rally. i don't think it's been very strong in terms of the magnitude of the gains, the velocity of the gains. it doesn't show that people are bursting in greedily and buying up indexes but it's been a methodical grind. i will say with the slim gains, it's overstated the strength of the market. it's wobbling underneath. more declining than advancing stocks. semiconductors, transports. a lot of the fan favorites were leading to the down side. is this going to be one of those subtle rolling corrections where you don't see the indexes or is this setting up finally for a deeper pull back. >> interesting is brian reynolds who's on vacation, it's a very good sign for stocks. he would say there's more room to go. as the dow climbs to another record today, billionaire

investor jeff oven issued a warning to investors at an event last night. lesli picker has more. welcome, leslie. >> thanks, kelly. jeffrey oven used terms like late cycle and bad stuff to describe some of the exuberance he sees in the markets right now. he said at these extremes the market is baiting investors to do the wrong thing. so what's ubben been doing? >> what that means at the top is you're not deploying capital, you're mr. no, right. and that's where i would be right now. so i'm disinvesting. i got 3 billion in cash. >> now cash represents about 20% of his $16 billion portfolio and while the markets have been cheering tax cuts and loosening regulation, ubben is focused on the longer term risks. he says everything about trump i think is inflationary. it's the last thing anybody is worried about. ubben said tax reform would be positive but said the devil's in

the details. he also spoke about the investment he made in morgan stanley last summer before donald trump's victory sent financial stocks soaring. he got super lucky because he didn't expect trump to win and, quote, all of a sudden regulatory relief looks to be on the horizon. rates are going up and volatility has returned. ubben sold about 15 million shares of morgan stanley during the fourth quarter because he says he doesn't know how to make money that fast, guys. >> they were up 60% from the time he bought them through today. just incredible. whether or not he got quote, unquote, bailed out. he clearly saw that was a home run investment at the time. i want to bring in brian belski who is with us. the question is where and how do you find value in this market environment? what do you think? >> well, at the end of the day, kelly, we believe that we've entered a prolonged period of fundamental investing and really

that really leads towards value investing. value properties have significantly outperformed the last few months and significantly outperformed since the election. it's not justify nans alls. clearly financials are a big part of the index. we think we're heading into an 80s or 90s environment where it's all about stock picking. price to earnings ratios, cash flow, book value really matter. so given that fact, our favorite contrarian pick in 2017 continues to be health care given the fact we believe many investors are not investing in health care for the main reason, less regulation. this has been one of the least restrictive fda vernements and most investors are overlooking that. we're overweight health care. i think mr. santoli made a great point with respect to a rolling correction even though the market's down a little bit

today. i wouldn't call that necessarily correction, but we need a little bit of a breather but we think it's going to be very normal. >> you say it's kind of under the surface. stephanie, bringing you in here. would you evaluate the market the same way? do you like health care, for example, or would you be looking at it differently? >> well, i think a lot of the reason why we've rallied is because of trump and the promise of better growth. we heard that from mnuchin for sure. but i would also say at the same time we've seen better economic data points in manufacturing, in c&i loans, consumer confidence, inflation. the data has gotten better. corporate earnings are getting better. balance sheets are getting stronger. yes, a lot of this rally is trump but a lot of it is fundamental. it's not just u.s., kelly, it's also globally as well. >> yeah. >> so i think there's a lot you can pick and choose from and i think that, yeah, sure, i've been very much an advocate of

the cyclical sectors like financials, materials, and industrials, but if you ask me where i'm putting my incremental dollars of late, it absolutely has been in health care because that sector has gotten extremely cheap and it does sound like replace, repeal, aca is probably going to maybe a little bit more back burner and so i think the stocks can have a catchup. yes, we've had absolutely a rolling sort of market where one day it's a cyclical, other days it's the reverse trade to the defensive. i think that's what you're going to have to see and it's going to be about stock picking and having exposure to all of those sectors. >> let's pick out earnings after hours. hewlett-packard. josh lipton has those. >> reporter: hpe reporting eps of 45 cents versus expectations of 44 cents. revenue is light, 11.4 billion. street was at 12.07 billion. just looking through the segments, kelly, enterprise

group revenue 6.3 billion. that is down 12%. enterprise services 4 billion, that's down 11%. software revenue, 721 million, that's down 8%. all three segments lighter than expected. turning to the guide, q2 guidance, 41 to 45 cents that's versus an expectation of 47 cents. then for the full year, kelly, hp is saying they've seen significant head winds develop since they provided that original forecast for fiscal 2017 back in october. they talk about this increasing pressure from foreign exchange, higher commodities pricing, near term execution issues so they are reducing their full year 2017 outlook by 12 cents. that means for the full year, kelly, they're now looking for 188 to 198. street was at 205. you see that stock reacting in the after hours. had been up about 7% year to date heading into this print. conference call kicks off at 5:00 p.m. eastern. kelly, back to you. >> thank you, josh.

6.5% drop for those shares now while its sister spinoff rebounded nicely and beat results. hewlett-packard ceo meg whitman will join squawk to discuss the results. that will be a cnbc exclusive and don't miss it. let's move on to nordstrom now. courtney reagan has the retailer's results. court? >> reporter: hi there, kelly. i'll call this a mixed result. that might be a little generous. take a look at what nordstrom reported for the fourth quarter. earnings coming in at 1.37 adjusted, analysts looking for 1.15 so that's a beat. revenues, we have a miss, 4.32 billion, a little bit shy of what wall street was looking for. comps down 0.9%. wall street analysts have been looking for an increase of 0.4%. the full year guidance from nordstrom for their earnings is very light compared to what wall street was looking for. the guidance is for a range of 2.75 to $3. analysts have an average

estimate of 3.06. nordstrom expects comps to be flad for the year. hopefully we'll hear a little bit more on the conference call. that's coming up. kelly, back over to you. >> thank you. actually, courtney, while you're here the shares are up 4% even though the flat comps is relative to expectation for a slight increase. any idea what might immediately be coming through to investors here on the positive side? >> you know, like we pointed out here, the earnings was a pretty nice beat at 137 adjusted and analysts looking for 1.15. everybody having doom and gloom so maybe flat comps isn't as bad as it could have been. that's not negative. that's not sharply negative. so perhaps it's not as bad as it could be. a little bit of relief, we'll see. as you know, these things can tend to bounce around after hours once we get more details on the conference call. >> that's true. 3.5% increase, 22% beat on the

bottom line. do you think that's a way to say it's not -- don't get too concerned. >> it could have been the cost discipline. 20% of the share sold short in nordstrom. you have maybe one out of every in our analysts -- four analysts recommending it. >> then you have the ivanka factor, stephanie. >> that business class is very, very low expectations. 25% of the sell side had buys on the stock side. 21% short interest. that said, it wasn't as near doom and gloom. most people were concerned about guidance and what it could come down to. it's a little worse than people were expecting on the guide. i think the stock was expecting that so you do get a little relief rally. to the point of them making the numbers, maybe their cost line did come in better. that's something that has been scrutinized at nordstrom for years even in the boom time.

this company has always done a really -- well, we wanted them to do a better job in terms of controlling costs. they're getting operating leverage. it's a tough slog for the space. if this continues to rally i think you take profits. >> then you had trump's comments on the border tax. what about hewlett-packard enterprise. they've done pretty much every metric. >> the interesting thing to me about hul let is that we have now heard from several companies about commodity costs creeping higher. likely memory costs going up. we've heard it from cisco and now we heard it -- we heard it from sister company last night and that is something to watch, kelly, because i think if that continues, it's going to be hard, especially as the top line is kind of marginalized, if you will. it's a lot of competition out there. i think that this stock isn't back but it slogs around because the valuation isn't very commanding. >> that's interesting. brian, anything you'd add to

that? >> the only thing about hewlett-packard, the business model is structurally flawed. from a fundamental position they've referred to the big ugly companies from a longer term perspective. we think you want to hone those companies in tech that have much strong ger cash flow in a more consistent stream of earnings. let's call it apple, let's call it microsoft, let's call it google are in a much better position in this type of environment. >> brian, stephanie, thank you for joining us. >> thanks, kel. >> before we go, the fact that jeff ubben was saying dehe c de-equitizing. >> he's de-investing. it's interesting because we're seeing this more and more from prominent investors in the market. they look at what's going on and they see the headlines in terms of tax cuts and loosening regulation and they say, okay, i see why this is stimulative to the market and how long is it going to last?

what does this mean on the inflation side? what does this mean on the fed side and how quickly do they start to tighten and increase interest rates as a result? what does that mean? and they say i'm out. >> ubben and other investors of his type, they like to bet only when they feel like the odds are deeply in their favor and they see something very misvalued. probably hard to find that. >> that's what's interesting. he invested in morgan stanley when it was one of those misvalued stocks and benefitted six months later. >> leslie, thank you. treasury secretary steve mnuchin says he's focused on tax reform. will lower taxes necessarily be enough to drive economic growth? we'll debate that next. nordstrom trading higher on its earnings after hours. coming up, what a border adjustment tax could have on retailers and consumers. you're watching cnbc first in business and worldwide. it's our little differences,

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welcome back. gap is out with its earnings. let's go back to courtney reagan. >> reporter: gap gave us an update on february 6th. the earnings per share are coming in adjusted at 51 cents. that is in line with the analysts because of the update we had gotten previously. earnings coming in -- revenue coming in at 4.43 billion.

that's a little bit better than analysts were looking for at 4.4 billion. comps up 2%. again, we knew that for the quarter. if you take a look at the guidance that gap is giving for the full year. it's a little light. 195 to 205 compared to what analysts are looking for. comps for the full year gap says will be flat to up slightly. no stocks after hours because of the monthly updates the gap does provide for us. that's where we were pretty close with the actual numbers. kelly, back to you. >> thank you, courtney. in fact, retail stocks falling in the final minutes after retail trade. trump told righters he supports some form of border tax. >> reporter: that interview with reuters out just a little while ago this afternoon. the president saying i certainly support a form of tax on the border. what is going to happen, companies are going to come back here, they're going to build their factories and they're going to create a lot of jobs and there's no tax.

so that would suggest that the president does believe there is some form of border adjustment tax that could be part of his plan. earlier in the day, follow the bouncing ball on this throughout the day. at 7:00 a.m. the president's treasury secretary steven mnuchin talked to becky quick. he said there were some things that were positive, some things that were negative. that was seen as the administration walking away from the border adjustment tax at 7:00 this morning. now we see this interview just a little while ago where they seem to be walking towards the border adjustability tax. that got the attention of the speaker of the house, paul ryan. his office a little while ago faxed that out, e-mailed it out, tweeted it out, the reuters e-mail to everybody in the washington press core. reporters here at the white house trying to figure out what all that means asking sean spicer about it in the white house briefing that just broke up here at the white house a few moments ago. here's what spicer said when they asked him about it? >> there is no tax if you're

manufacturing in the united states. so there can be no higher costs. if a company chooses to stay and grow in the united states, hire more people, it actually will be a net savings if you think about it because it will be the companies who are overseas who have chose zwroen move out of the country who will face a higher cost under these kind of plans. >> reporter: so, kelly, i think the key here is what the president said, some form of a border tax. what does he mean by some form? there's a lot of presidential wiggle room in those two words, kelly. we'll have to wait and see where the white house goes from here. >> let's try to wiggle through it, eamon. tax reform and growth were key topics in becky quick's interview with treasury secretary steven mnuchin. here's some of what he had to say. >> the number one issue is growth, and the first most important thing that will impact growth is a tax plan. we want to get this done by the august recess. this won't really impact the economy until next year when you begin to see changes in behavior, and it will take a couple of years to get growth. one of the important jobs in this is to make sure that i

reach out to my counterparts and that we're focused on creating objectives that will create economic growth for us and sustained economic growth throughout the world. >> well, another question is whether those tax cuts always do lead to growth. joining us are kayla tausche from washington, also jimmy petankukis, a cnbc contributor. also in the nation's capitol, austin goolsby. economics professor at the university of chicago booth school of business. i want to dig into this issue about how tax cuts raise growth. first, jimmy, because the president just mentioned it, can we also try to disentangle what's happening, the border adjustment tax steve mnuchin indicated is a concern. then the president said he would support a border tax which could be a tariff. are these two separate issues? >> they are two separate issues. i cannot imagine selling a retail stock based on anything i heard today whether it's from

spicer, mnuchin or the president himself. did the president use border adjustment? he said some sort of border tax. that could mean a border adjustment or you could phase it in, exempt certain industries like retailers, who knows, or it could mean an across the bored tearif tariff. it could mean punitive or retaliatory. i think this is extraordinarily nebulous. i can't imagine making a decision based on what i heard today. >> austin, what can you discern about how this is evolving? the key question we've been waiting on for weeks is whether the president would support border adjustability which would raise $1 trillion. it sounds like his administration isn't really doing that as much as the congress might want it so if not but he still wants some kind of border tax, what do you think he's talking about and what would that look like? >> he doesn't know what he is talking about.

how do people not see that? he does not understand what the border adjustment tax is that paul ryan is proposing. we've seen this multiple times. they confuse it with the tariff. when they hear what the details are, when they see what retail companies recognize that it will hurt them, they say we're not for that kind of border adjustment. they are confused. what the border adjustment tax does is effectively replace the corporate income tax, you stop taxing producers and you start taxing consumers. there are reasons why you might want to do it, but make no doubt about it, consumers, retailers, oil refiners and the people selling gasoline, they're going to notice a $2 trillion tax on them. so i think they're going to rediscover why tax reform is hard and they're just going to try to cut the rates and pretend like that will pay for itself. >> you know, whatever secretary mnuchin, whatever the president meant or didn't mean by all these comments, kayla, i guess

i'll throw this to you. it all comes down to what congress is willing to accept in terms of what on paper seems like it can produce revenue or deficit neutral plan and of course what the senate might actually try to get through because that seems to be the roadblock for anything that looks like a border adjustment tax. >> the senate appears to be very mum on this issue. we do have some very broad contours and specific numbers from the house plan from last summer, but what we have in the meantime is a lot of talk and we don't have any tangibles from the white house to go off of. it's hard to comment on tax reform and what type of tax reform we could get, how broad-based it would be, how deep it would be, how much it would benefit businesses, how much it would benefit seville yans because we don't really know at this point. i called a few business lobbies and they said we haven't published on this because our clients are split and we don't know enough to weigh in on what we've seen so far. where we're talking about gdp, two of the biggest components are net exports and consumption.

those depend where in the business cycle you are. if you have this border adjustment tax, yes, that might benefit any sort of exporter unless you have some sort of punitive or retaliatory protectionist policy that leaves other countries to stop buying our goods anymore. >> in the end does anybody think that republicans are going to let this border adjustment tax, even if it causes an extra trillion dollars of revenue loss be the stumbling block to get a big tax cut? i find it hard to believe republicans controlling the white house and the senate that we won't see it -- >> that's the big question, austin. what were you going to say? >> i totally agree. and what they're going to find is donald trump gave you no specifics through the campaign so he did not build a consensus around any difficult choice so whenever they go in to try to do something that involves a

tradeoff, you're going to hear howls. people say, wait a minute, you never told us they're going to raise our taxes. they're going to cut the rates. that will project a deficit increase. you saw secretary mnuchin himself do it is they're just going to politically go down and order the economists to raise the growth forecast to almost double what the private sector forecasters are saying. >> right. >> it's not going to increase the deficit. >> dynamic score, that's directed scoring. >> directed scoring is the right phrase. that's a great phrase. >> melissa, you know, the point that larry kudlow's been making about this, jimmy, so what? the argument is if they think this is going to be good for the economy, if they want corporate tax to happen, maybe it should be more piecemeal at this point, they want to do it this way, they'll do it this way. the larger interesting issue for me is is obamacare really going to happen? is this big kind of tax package

and cut going to happen? you know, is it all going to end up kind of just crumbling and the only thing we're left with is a piece meal corporate tax cut? you know, in some ways these are huge things they're trying to move forward on. maybe none of it can really happen right away except that one much more narrow piece. >> i think practically it's going to be very different to do a big, sweeping transformational tax cut and do nothing on the personal side. i think the mechanics of that will be very difficult. as far as obamacare, again, that's supposed to come first. that's supposed to be the priority, they're going to do that and then they're going to do the corporate tax reform. that's what they've said they're going to do. remember, the tax reform, it's supposed to help pay for the infrastructure. there's an interlocking aspect to all of these things where they need to start making progress or it could get bogged down. >> yeah. that's the talk right now. kayla, thank you. jimmy, austan, thank you.

watch your back, detroit. a new spot is shaping up to be the motor city and it is thanks to donald trump. phil lebeau is live in the port of charleston, south carolina, with the details. hi, phil. >> reporter: kelly, what better place for me to be when you're talking about the debate over exports and imports than here at the port of charleston. to give you some perspective on the size of container ships, we'll talk about autos in a bit, the container ships. take a look at this shot from our photographer leroy jackson who is up on one of the cranes above this cargo ship that is unloading 6700 containers, each of them about 40 tons in weight. by the way, they're going to do that in about 18 hours total. that's how long it will take to load and unload that ship. but of course part of the reason this port has become so busy, in fact, they just had their busiest month, is because of the auto shipment business. this is the main port of shipment or exports for bmw.

remember, they build these vehicles just three hours north of here in south carolina. 70% of the bmws built in the united states that are exported, they're coming through this port here in charleston and it brings up the question, which states are the largest in terms of the value of the auto export trade? which, by the way, is growing in the united states. south carolina ranks number one with almost $10 billion in value in terms of auto exports. there you see alabama, california, and number four is michigan. the bottom line is this, kelly, in the united states there are about 2 million vehicles that are exported every year, and that number is growing, not as fast as the imports, but it is growing, and because of what's going on here in south carolina they're watching this debate over export/imports and whether or not there's some sort of border adjustment tax that is implemented because it certainly could have an impact on bmw's business. remember, they have volvo coming here in the next couple of years

as well. kelly, back to you. >> i don't know about you, mike. i didn't know charleston was making a run at detroit for this title, so to speak. >> in terms of auto export and also making a run at the other port cities. that's a big story phil's been covering. it's a big old harbor, not surprising but very fascinating how active it is. >> phil, i don't know if you're still with us. >> i am. >> we were just having this whole discussion about border adjustability and border tariffs, the auto industry has been in many ways kind of at the forefront of this. we've seen the ceos going to the white house and trying to make sure that nothing happens that would punish them even more here, but is there any talk of them somehow being exempted if these kinds of things move forward? >> reporter: well, how do you do a car load? in the united states last year when you look at the vehicles that were bought, there were over 17 million, 8 million were imported. we're not just talking about mexico, although that's the largest import country, canada,

japan, europe, other countries in asia. so there is a huge amount of business for the auto industry that relies on the import of importing these vehicles, and if you're going to put a tax on them, what does that do for the demand? are people willing to pay a couple grand more for a small sedan? what used to be priced at 21,000 might be priced at 23,000. does that hurt demand? certainly the auto industry is watching this closely. >> i always watch you closely because i realize you're on a boat yourself. careful. >> i am. >> in the middle of a port. how far are you from land? >> reporter: i'm not going anywhere. these guys are great. i'm not going anywhere. >> phil lebeau on a boat in the port of charleston. thank you so much. oh, man. obamacare is the hottest topic at republican town halls across the country this week as people are questioning their lawmakers about how they will repeal and replace.

coming up oklahoma congressman tom cole with his plan for the future of health care. we'll be right back. that means you can take a universe of data - in your case literally - and turn it into medical discoveries, diagnostic breakthroughs... ...proof that black holes collapse into one singularity. i don't know what that is. but yes. innovation runs on supercomputers... ...and supercomputers run on intel. you are super smart. and super busy. ♪ ooh! ufo! false alarm, eyelash!

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the global investment management businesses of prudential welcome back. time now for cnbc news update with contessa brewer. >> white house chief strategist steve bannon and reince priebus are attending the conservative political action conference in maryland. bannon says every day is going to be a fight against the media

and progressives. >> he's going to continue to press his agenda and as the economic agenda gets better they'll fight. if you think you're going to get your country back without a fight, you are sadly mistaken. every day it is a fight. >> little tykes is recalling half a million toddler swings because they can break and cause the child in them to fall. the swings were sold between november of 2009 and may of 2014. the company says it's received 140 reports of the swings breaking including 39 injuries to kids. the american psychological association is releasing a report on the role technology and your stress level can play in your life. on a 10-point scale, their average stress level is 5.3. that's nearly a full point higher than those who don't have

an addiction to whatever is coming in on their screen, kelly. so it's a good reminder for all of us to, just, i don't know, take a break once in a while. >> i know. step back from a lot of it. even on the e-mail. do you need to check all the time? >> your bosses think so. >> i know. sorry, lisa. no, i'm kidding. thank you, contessa. see you later. gap and nordstrom releasing earnings just moments ago. both trading higher after hours. nordstrom is up 3%, gap by 1%. to you top analysts weigh in. consumers won't have refunds, stay with us.

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welcome back. the national retail federation out with a new survey showing 48% of americans plan on saving their tax refunds, not spending it. does that spell out more trouble for retail ahead? let's bring in dana telsey and eddie ruma from key bank capital markets. welcome, dana. it's not the absolute number of people doing this it's the fact that the proportion going up and the proportion spending going down. does that surprise you? >> it certainly does. we've been seeing definitely consumers taking a little bit of a more cautious stance given

that unemployment is low and the consumer landscape is pretty good for how consumers are doing and wage growth but they're saving rather than spending and they may save for a longer bit of time. >> and it's also, when we say saving, it's not just putting money in the bank, it's also paying down debt, ed. a lot of retailers rely on this refund season, don't they? how much -- how much so would you say? >> well, certainly this is a key time for refunds, the january, february time frame. the delay in refunds has certainly impacted retailers. it's tough to quantify, but it does seem like february got demonstrably weaker across the board. >> walmart called it out, didn't they? i believe they spoke about the delay, said they didn't get the spending they were anticipating. the interesting thing is what if the spending doesn't show up at all? do you expect that to be more of a problem even as people get these checks, ed, they're not 13e7bding them? >> look, ultimately people are saving. we always see that when people

postpone spending, some percentage of that spending doesn't occur. they find other things to spend things on. they opt not to buy. in the case of apparel you're missing some part of the season. clearly a later refund is not helpful. >> and, dana, i guess the question i would have is what context is it more broadly for the position of consumers? i do see some people remarking upon an uptick in delinquencies on auto loans. i guess people are wondering if around the edges despite the fact wages are growing, unemployment is low, there is a reason for caution at the general household level? >> we've seen a little bit of that. you've seen some of it come out of some of the discounters. you've seen it come out this week from the retailers where it's the department stores and the weakness in sales. we just had nordstrom report and their full line comp store sales were negative. of course, you had l brands today who obviously saw a down trend in business trends in the month of february given weaker traffic. so overall the consumer

environment, the beginning of the year is starting off on a definitely more cautious tone. >> we'll see where it goes from here. thank you guys for joining us. dana telsey and ed. we have some news now from the justice department. let's get to eamon javers with that. >> reporter: hi, kelly. the attorney general, jeff sessions, is taking action today on private prisons. he's just issued a memo which rescinds a previous obama memo to scale back on contracting with private prisons. jeff sessions saying in his memo today that he wants to return the bureau of prisons to its previous practice in which it did use contract with those private prisons. interestingly, this is a sector, the private prison sector, that's been very close to president trump and his campaign. "usa today" reporting that geo group which they say was one of the nations largest for profit prison operators donated $250,000 to support trump's

inaugural facilities. and corcivic gave $250,000 for the inauguration. clearly an industry here in the private prison industry that saw something they very much liked in donald trump's administration and the attorney general saying here today that he sees something that he likes in the private prison industry. >> kelly? >> thank you, eamon. >> reporter: you bet. congressional republicans holding town halls and they are firing. oklahoma rep tom cole tells us the house plans. you're watching cnbc first in business worldwide. with the help of the lowest taxes in decades, a talented workforce, and world-class innovations. like in plattsburgh, where the most advanced transportation is already en route. and in corning, where the future is materializing. let us help grow your company's tomorrow -

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why invest in average? republican lawmakers are getting grilled who are concerned about their repeal. here's a moment from senator tom cotton's town hall in springdale, arkansas. >> i can tell you three members of my family, including me, that would be dead and homeless if it was not for aca my husband had dementia. they stand there with human heart. expect us to be calm, cool and collective. while what kind of insurance do you have?

>> more on the challenge on obamacare. let's bring in republican congressman tom cole. welcome, congressman. >> great to be with you. >> you see there the challenges. we have guests saying let's see how this gets done full stop. is there a plan, a way to repeal, replace, improve, whatever, obamacare? >> yes, there are. i think you begin with the frankly sad reality that obamacare is a failing system. look, in my home state we're down to a single provider now if you're on obamacare. if you're not getting a subsidy you're going to have a 69% rate increase. for us doing nothing is not an option. in the short term you want to protect the people that are already on obamacare and the president and the speaker have been absolutely clear that nobody's policy's being canceled this year. frankly, my guess would be probably next year, too, because the new policies have to be in place by april for next year and

we're not going to have the legislation done that quickly. >> by this april? >> yeah. >> what is the plan though? i mean, in all seriousness, is there a sense of, you know, are we talking about one bill for repeal, one to replace? >> no. >> is this going to be more piecemeal? tax credits? >> it's going to -- it's going to be more piecemeal. i think it's likely to be refundable tax credit so people at all ends of the economic spectrum can use it. there will be a much bigger reliance on health savings accounts. you're going to over time be able to have association health plans where small companies can pool and buy coverage at a cheaper rate. the selling of insurance across state lines, medical liability reform, all those things have to be put into place and you also have to, frankly, wrestle with the naughty question of how do you pay for the people that really are in dire circumstances. about 6 or 7% of the population use about 770 to 80% of the

insurance. they're backed by the federal government. the other big issue is what do you do between medicaid expansion states, there are 31 of those that use medicaid and the 19 that have frankly chosen not to do that. that has to be worked out. i see a process, not an event. there's not one 2,000 page bill. it's got to be replaced because it's failing. >> congressman, all of those things you lay out are all the complexities that got us to the approach that is now encapsulated in the aca, meaning health care is not a good like most others, right? when the cost goes up people decide to consume less of it so you have to have all of these work arounds, subsidies and credits and things like that. how can you necessarily take them one by one when you're really not requiring, for example, those healthier people to buy in? any one of these elements seems

to have the whole thing really kind of erode? >> i think it's complex. again, you start with the reconciliation package and you start with the basic decision how much of the obama taxes do you keep to finance what you're going to replace it. again, what we're doing isn't working. doing isn't working. i go through an obamacare exchange, every member of congress does, i'm buying a lot of stuff that i frankly don't need. i'm 67 years old and i'm buying maternity insurance. you know, i have to buy mental health insurance. now, maybe if you're in congress you need mental health insurance, but i've never done in the past before. >> or tv. >> yeah. maybe more on tv these days. but you know, let people tailor it. for a person in their 20s, what makes sense for them, probably catastrophic health care insurance and a health care savings account with a refundable tax credit if they're in good health. we think there's a lot of things you can do to lower the cost. >> congressman, thank you. i think notably you said there

it is a process, not a bill. we'll all be watching with bated breath. appreciate you joining us. >> thank you. >> congressman tom cole of oklahoma. fannie mae and freddie mac climbing a littler today after remarks on housing reform. what he means for these entities. and coming up on "fast money," president trump saying he's in favor of some kind of border tax. the former ceo of jcpenney ron johnson will be there on what it means to the retailers at 5:00. happening here? hey nicole, this is my new alert system for whenever anything happens in the market. kid's a natural. but thinkorswim already lets you create custom alerts for all the things that are important to you. shhh. alerts on anything at all? not only that, you can act on that opportunity with just one tap right from the alert. wow, i guess we don't need the kid anymore. custom alerts on thinkorswim. only at td ameritrade.

the fate of fanny and freddie may be one of the more challenging public policy issues facing the trump administration and they have a lot of them and it's very much on the mind of the treasury secretary, steve

mnuchin. diana joins us from the nation's capital. >> the treasury secretary said he had a meeting with fannie and freddie's conservator this week. here's what we know. just after the election, mr. mnuchin said we've got to get them out of government control, but later, during his confirmation hearings, he said my comments were never that they should be recapped and released. today, he was decisive on change but not on details or timing. >> i'm committed that under this administration, we're going to have housing reform so that we don't just leave these entities the way they are. they've been sitting there for too long of a period of time, and we need a solution. >> now, the treasury secretary may be committed to housing reform, but he was clear it would take a backseat to tax reform, saying we should not expect to see anything on housing, quote, right away. no surprise given how complicated a fix will be and frankly how profitable fannie

and freddie are now. don't forget all that profit goes straight to the treasury department. take a look at the numbers. we saw so far the two have sent $265.8 billion. they drew $187.4 billion during the crisis, but neither one has needed a draw since 2011. that puts taxpayers ahead by $78.4 billion and the money just keeps on rolling in. so you can see why the administration needs to fund a new infrastructure plan might not want to rush to get rid of all that cash. kelly? >> yeah, probably not. we'll see where it goes, diana. thank you. and jimmy buffett, beware, there's a new burger in paradise but it costs as much as 1250 big macs when we come back. ♪ my business was built with passion... but i keep it growing by making every dollar count. that's why i have the spark cash card from capital one.

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created an epicurean marvel, the fleurburger 5000, a hamburger so rich it will cost you $5,000 if you order it. >> the $5,000 is like -- it sounds like crazy because it's las vegas, it's overdone. no, i think the whole experience is something real. >> in five years, chef hubert has served 28 fleur 5000s and this one is number 29. wow. oh my god. and this experience was so good, i just might have to pony up for number 30. >> so, just a note. the reason that burger costs $5,000. >> it comes with a bottle. >> it's paired with a '95 petrus, considered one of the great wines, it retails for $5,000 so you're getting the

burger basically free with the margin they make on the '95 petrus we but you get to keep the bottle and you get a certificate. >> this is why people are silly enough to spend the money. >> you can see that and more tonight on secret lives of the super rich. >> if you just won at the casino, it doesn't cost you anything. >> "fast money" starts right now. "fast money" starts right now, live from the nasdaq markets overlooking new york city's times square. i'm melissa. tonight on fast, some classic trump trades showing cracks, some sold off hard today and that had one of our traders hitting the buy button. we'll explain. plus the word that stopped wall street, treasury secretary steven mnuchin giving president trump the credit for the rally. is trump the first stock market president? the man who took down nvidi