>> the market comes down, but then i think you get an opportunity to buy. >> right now the dow is virtualvirtual ly flat. do you think comey's testimony tomorrow will have a big impact on the market? i think there's some concern about it going into it. i don't think so. i think he's more measured than that to launch any bombs. >> all right. guys, good stuff. see you all tomorrow, as well. "power" starts now. >> i'm melissa lee. here's what's on the menu. president trump in cincinnati right now getting ready to sell his $1 trillion infrastructure plan, but looks like there might be some major potholes in the way of his agenda. burgers, fries, and a shake in stocks. here's a shake shack rebounding a bit lately, but down since two years ago. all that plus a rare and exclusive interview with hedge fund titan ken griffin of citadel. his take on the markets and the president and what's keeping him up at night. "power lunch" starts right now. now you love him.

>> welcome to "power lunch." i'm becky quick. take a look at the markets at this hour, check things out, you'll see they're barely bud budging when it comes to these markets. the dow is flat, so is the s&p 500. the nasdaq not even moving by a point. it's the first up day in the last three trading sessions, but up by a point. oil prices, off a cliff there. financials are leading the pack with goldman sachs among the top performers in the dow. and it's another bad day for macy's. that stock hitting levels that we haven't seen since 2011. all right, becky. also happening this hour, global economic growth should come in at its highest level in six years, but the oecd did cut their forecast for the american economy. can the president really deliver on his promise for 3% growth? plus, two intelligence agency chiefs saying today they never felt pressure from the president to intervene in the russia probe. all of this comes ahead of james coyle's testimony tomorrow. and on a lighter note, go get your tickets, all you new

jerseyans. the new jersey powerball jackpot is now at $375 million, making it one of the largest jackpots in american lottery, state lottery history. that drawing will be held tonight at 10:59 p.m. all right, those are your headlines. now, let's get to more on what has been a very busy news day in washington, as the world awaits james comey's testimony tomorrow and the president proposing a new fbi director today. all of this as trump travels to ohio to make the case for more infrastructure investment. eamon javers on the case live on all of this stuff and joins us now from washington. eamon? >> hi, brian. i think we've got a live picture now. the president is in cincinnati, ohio. he's just wrapped up a few remarks here in front of air force one, with families who the white house are calling victims of obamacare. people who have had their premiums increase, had health care difficulties, et cetera. he just shook their hands and now he's moving on to his next venue, where hays going to be giving some remarks on infrastructure in ohio, as well. the president very much trying

to stay focused on his legislative agenda today, a day before that comey testimony. but this morning, he also took time out to tweet an announcement of who he's picked for the fbi director slot that's open because he fired james comey. the president's tweet saying, "i will be nominating christopher a. wray, a man of impeccable credentials to be the new director of the fbi. details to follow." some of those credentials for mr. wray include he was the assistant attorney general in charm of the department of justice's criminal division from 2003 until 2005. he oversaw the enron task force and led efforts to address corporate fraud while at the department of justice. he's also received the department of justice's highest award for public service. and interestingly, brian, wray will have worked for director comey while he was at the department of justice. director comey at the time, was the dag, the deputy attorney general, wray was running the criminal division. that means that wray reported to comey. now he will apparently be the president's pick to secede comey

as the director of the fbi, brian. >> yeah, and i will see your relationship and raise you one more, as i showed on "morning joe" this morning, eamon. i found a press release from 2002. i put it out there on social media. it was james comey, christopher wray, and -- wait for it -- robert mueller, all listed in the front -- it was an enron indictment of ken lay.guys, the is -- >> they're putting the band back together. >> a little hard to read, but they're putting the band back together. 15 years later. i don't want to say we're recycling the same gentleman, but those guys probably never imagined 15 years ago that they would be meeting and together and linked in this form. >> yeah, look, federal later is a very small world at the tippy-top and that's where all these gentleman have been for a number of years. clearly, the president deciding to pick somebody here that will have a good chance of getting senate confirmation. i've talked the to some folks in d.c. today who say they suspect there will be democratic votes for christopher wray in the senate to confirm him as the fbi

director. we'll see how many democratic votes he gets, but looks like he should be on his way to confirmation. >> eamon, thank you very much. of course, that bripgs us back to the question, when could we start seeing progress on the president's agenda. is it going to continue to hit the road blocks? for the answers on all of this, let's bring in cnbc contributor, larry kudlow, and pennsylvania governor we governor, ed rendell. larry, we did see a little bit of urgency today from the freedom caucus, when they suggested, look, we're going to cancel the august recess, we need to get to work. >> yes, fabulous. just fabulous. >> lwill it actually happen? >> steve moore and i had lunch with mark meadows yesterday and talked about it and a couple hours later they formally voted on it. yeah, i think there's a very good chance the august recess will be canceled until and unless they get the health care bill sorted out and the tax bill. i want to come back to that, it's very important. look, this is it. you know? if not now, when? and the gop, i think, is developing a sense of urgency,

which had been lacking. i saw it when we were in the west wing yesterday visiting with a lot of people. i heard it from mr. meadows and kind of felt like it was rippling through. the senate is closer to a deal on health care, all right, what i call bipartisanship with itself in the republican party. >> that's -- right. the two sides of the republican party, the moderates and the conservatives -- >> something like that. but, yeah, they're closer than you think and the tax piece might be closer, but you've got to drive this process. so shaking it up by no recess, no -- fine! are you going to work this summer? >> of course i am. >> are you going to work this summer? >> i plan on it. >> sully's taking the summer off. >> yeah, he's off. >> well, we've got so many presidential press conferences that we've kind of been taking the last few months off. >> i'm just saying, if we can work, they should work. >> what is is urgency, all of a sudden? >> they got to get this done. i mean, everybody's telling them to get this done. >> do they realize they're

taking hits in terms of the perception of the republican party, whether it be comey or all these other things. >> yeah. yeah. >> so that is actually sinking in? >> this is apart from comey. but look, if they don't get this done, they're going to get creamed in the midterms next year, on two grounds. number one, they will not have taken steps to palpably improve the economy on wages and so forth. number two, they can't govern. you elected them, they should be able to governor. i want to come back to the tax -- this is a big step. >> let's bring governor rendell in. governor, you see it the same way? >> i think larry's analysis is right. i think the republicans in congress have to do something or else they'll suffer the wrath of the voters. but just passing something isn't enough. it's got to be legislation that actually helps people, not hurts people. and that's the rub. i mean, if the health care bill the house passed was enacted into law, i think they'd be worse off than if nothing passed. because i think the people of america understand that that health care bill is detrimental

to the vast majority of people, while it gives an almost $800 billion tax cut to wealthy americans and the corporations. >> the health care will that comes out of the senate is going to look very different than the one that was passed by the house. i guess we're talking about -- >> well, we'll see. >> it's not 1000% different, by the way. >> but again, it has to go -- >> i'm sorry, governor. >> no, larry knows, of course, that it has to go through conference. the bill that comes through the senate isn't the final bill either. >> right. all i'm saying is, medicaid is a very key issue here. >> sure. >> that is -- that can get done. it can get done. >> just by expanding it for the states that haven't already been in? is that the -- >> i don't want to predict the language, but the answer is basically yes. the federal government may pay -- play a larger role in guaranteeing preconditioned people with sickness and illness and the poverty line. that may be coming, which the gop should have done that a long time ago. here's the other thing. i just want to run this by and see what the governors -- look.

nothing definite. but steve moore and i have come up with a new movie. it's called "three easy pieces." do you remember "five easy pieces" with jack nicholson? you don't. you're too young. >> we were talking about it in the makeup room. classic early '70s nicholson. >> you're right. so we met with senior, senior, senior people in the west wing yesterday, and we presented this plan. and it's simple. three pieces is all we want. get done what you can get done. number one, lower the corporate tax rate 15%, whatever. >> i'm shocked you would bring that up. >> number two, immediate expensing for new investments. number three, repatriation at a small 10% one-time rate. now, there is widespread agreement in washington to get a business tax cut through, which, by the way, the 70% of the benefits go to the wage-earning middle class. that's very important.

leave the larger issues for personal tax reform and overall -- leave that for next year. just get this done and here's the clincher. you can legally and technically attach that kind of business tax cut to the health care reform bill in reconciliation for 2017. that can be done. now, i'm not saying the people we've tried to sell this to in the white house -- i'm not saying they agreed. i'm not saying anything. they listened, they're pondering it, it's in play. no commitments. i don't want to mislead people. but i'm just saying, that's cooking. it's cooking. and you can attach it to the reconciliation bill. no one's expecting that to happen. >> governor, what would happen if that was a plan that was pickpick picked up? >> well, with look, there are parts of that i agree with. i agree with the repatriation of 10%, but that money, every nickel of it, should go to an

infrastructure plan. the president promised during the campaign to do $1 trillion of infrastructure investment. now it's really over $2 billion over ten years, that's $20 billion a year. he wants the rest to come from the local government and the private sector opini. the private sector has a role to play. 24 states have raised their gas tax in the last five years. they're contributing. we need federal investment. use the 10% repatriation dollars, 100% for sfru infrastructure, and raise the gas tax by what bob corker has introduced in his bill, 10%, cost the average driver $140 a year, but mollify the average driver by doing the tax cut they were going to do anyway, which will give middle class people much more than $140 a area in tax cuts. >> this all passed with just republican votes. because that's what you're talking about? >> i think that's what's going to have to happen. much to my regret. it's going to go through

reconciliation. >> if you did the repatriation dollars and dedicated 100% of them to infrastructure, you get a gas tax increase, which the president talked about a month ago, and did that for infrastructure, obviously, it has to be for infrastructure wing you would get some democratic votes. >> not if it's attached to the health care bill. >> you might. >> no, no, i would attach it to the tax reform bill. >> thank you, sir. no, no. that's right. i'm not going to rule out any of these details. there's no reason, there's no categorical, imperative reason that says you couldn't dedicate the repateuation to infrastructure. i think the governor has a good point. >> that's john delaney's plan in maryland. >> it's been around for a couple of years. >> he's a democrat, but he's working with republicans. >> right. i think the gas tax is a reach. i don't really think they're going to get there. but to the infrastructure point, yes, a lot of people want to see this infrastructure. by the way, you have to love -- you have to love trump's proposal to privatize the air traffic controllers. you have to love that!

that's in the same spirit as privatizing airports -- >> "the new york times" had a really -- governor, we've got to go, but i've got to ask you this. "the new york times" had a very negative piece on public/private partnerships. >> really? shocking. >> governor, i'm not going to criticize the president or not, but i might criticize his speechwriters. how surprised were you that they're throwing out pittsburgh as their example. pittsburgh, it's not the '70s. you're one of the high-tech capitals of america. it's got all carnegie mellen robotics, the driver lels cless. >> it's actually stunning, because pittsburgh's a perfect example of some city that reformed itself from being an old manufacturing city that polluted its own air into a clean environment, clean tech, high-tech booming economy. i mean, do they do any real facts in the administration now? >> it was alliteration. that's what kind of got thrown in with the alliteration. if he said pennsylvania, it would have been --

>> producers are screaming. just let the record show, my friend, governor rendell was pro-fracking many years ago. >> i am pro-fracking. i still am. >> to your ever-lasting credit. >> it's a benefit to the environment. >> you're a pro-growth, pro-business jfk democrat. you're my kind of guy. >> thank you guys, both, for being here. >> -- terrible tweets as a result of that. terrible tweets. >> thanks, gentleman. still ahead, an exclusive interview with billionaire hedge fund manager, ken griffin. a lot to talk to him about, including why the market has been indifferent to the d.c. drama and what event could finally shake it up. but first, shares of shake shack rebounding this year, but still playing catch-up. get it? it's like a brian sullivan joke. >> my puns can easily cut the mustard a lot better than that. >> shares is have been playing catch-up since the ipo. next, we'll talk to the shake shack ceo, randy gratitudy about his plans for the company. don't go anywhere. "power lunch" is back in two.

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i love to see businesses that just started from ground up grow into further success. it just feels good to know that i'm helping someone else. my first goal is to learn about their business, what they're currently doing in their advertising. pull some research, create a great story. trying to figure out some way of building some kind of trust in a very quick moment. you have to love to work with people. our goal, without a doubt, is that all customers are satisfied before they leave. ♪ shares of shake shack are up 17% in the last three months, but investors who bought shack at the ipo have had some indigestion. since going public, shack is down 17%. at one point two years ago, it actually traded near 100 bucks a share. randy garutti is a shake shaceod

out with his first book. randy, welcome to the show. >> thanks, melissa, good to see you. >> i want to ask you about what is going on in this business. for a long time, mcdonald's had a bad rap and shake shack was the answer to the fast food burger. in the past few years, your stock is down about 50% and mcdonald's shares are up about 50%. what do you think is happening in the stock market and the perception of the shack stock. >> we learned a long time ago, our focus is on creating the best community gathering places we possibly can across the country. we wanted to change the narrative that fast food created over a great five decades and do things fresh, no hormones, no antibiotics. that's what the book is about. and i think when you think about it, warren buffett quoted famously saying, you know, in the short run, wall street is a voting machine. in the long run, it's a wang machine. and i think our shareholders, the story about shake shack is a

long-run story. we've got a long way to go. and we feel like every day, we're barely getting started. and just now reached 134 shake shacks across the globe. when we went public, we had significantly less than, around 60. so we're having a lot of fun building a great company for decades to come. >> i can appreciate the long-term sentiment, randy, and i absolutely love -- we have burgers here on set and we can't wait to start digging into them. so i'm a fan of the product. at the same time, for investors, when they perceive your stock, it's priced like a growth stock. it's trading at about a 77, 78 times current multiple. and that's more than facebook. and in your most recent earnings report, you said you expect flat sales this year at locations open more than two years. are you still a growth stock? because you're priced like a growth stock, but there are some metrics that indicate you might be seeing slow growth. >> well, actually, i think if you look at it, our growth last year was over 40% revenue growth. that would not be characterized as slow. and we're certainly seeking another number. we're going to be about 350 plus

million this year. it has truly just gotten started. if ever there was a growth company with a lot of legs out there, we think we can be at least 450 shacks in this country alone. you look at some of the exciting things that are happening for us, our average unit volumes are some of the best in the industry. over $4 million had 3,000 square feet on average. those are numbers that are rarely ever seen in our industry. you duogo to seoul and korea to, go to tokyo and japan, go to l.a., and you'll see rabid shack fans. and i think we have hit on something. we've hit on a moment in the world where people want to know where their food comes from. they want to know it's with great ingredients served by really insere, hospitable people. and in this social media age where we're living, we all want immediate gratification and we're constantly sharing everywhere we are, we want to make good choices and still want a really good hamburger. so you look at our social

following and -- >> right. >> randy, sorry to jump in. i've actually never had one of your burgers. i'll be happy -- >> what?! >> let's get it done. >> i live in new jersey. we don't have anything there. >> we do have a couple near you in paramus. i'll send some burgers over your way. >> i think we've got some here, randy. two questions about expansion. number one, all the stuff you just said, how confident are you that while you expand and get bigger, you can still maintain that quality and approach? i mean, as you get bigger, you've got more stuff to control. and number two, when you go to california or you go to texas, you've got two big dogs out there. you've got in-n-out and waddaburger. how do you maintain quality and compete against them? >> if i'm headed to l.a., i'm headed to in-n-out, i love those guys and they've built an amazing company. our avus in california is over $4 million. we have lots of shacks there. we'll be opening more in san

diego later this year and we are doing astounding numbers. i think we've earned our way on to the rotation of california burger loves. texas, we're just starting to grow. we have some cool shacks in austin, blowing the doors off in houston and dallas, as well. i think there was an early notion, being a new york-based company, and so many people associate us as the east coast burger, because that's where we were successful, turns out we're really successful wherever we've gone, including lexington, kentucky, a few weeks ago and places like that. and i think that's what people who are buying the stock and holding it and believing in the story for the long-term understand. this is a story of unit growth. this is a story of absolute huge sales growth opportunity. and a story of people who have just become serious fans of loving what we do. >> all right. randy, we're going to leave it there. a pleasure to speak with you. >> you too. enjoy those burgers. >> we sure will. randy garutti, thank you. up next, home buyers are rushing to lock in loans, but

will that trend continue? and a rare and exclusive interview with hedge fund manager ken griffin. "power lunch" will be back in just two minutes. usaa gives me the peace of mind and the security just like the marines did. the process through usaa is so effortless, that you feel like you're a part of the family. i love that i can pass the membership to my children. we're the williams family, and we're usaa members for life.

♪ dynamic performance, so you can own the road. track-tuned handling, so you can conquer corners. aggressive-styling, so you can break away from everyone else. experience the exhilaration of the bold lexus is. experience amazing. welcome back to "power lunch." i want to take a check tonight bond market right now and take a look at the action here. we've got two-year treasury yield, now at 1.306.

ten-year, of course, which is the focus of many investors, to 2.619% in today's session. that is today's bond report. mortgage rates dropped last week since their lowest level since the presidential election. that caused a mini rush on the lenders and there could be more ahead. diana olick reports from washington. diana? >> reporter: well, borrowers saw an opportunity and jumped right in. despite all the talk of rising rates, rates have actually been falling lately and last week dropped even more. the average rate on the popular 30-year fixed came down to 1.41% from 1.47. just from a reference, rates jumped from 3.77 to 4.16% in the two weeks following the election, last november. now, the drop last week caused a big rush from potential buyers. those mortgage applications jumped 10% for the week. refais got a small boost, too. but they're far more rate sensitive and rates were lower for the bulk of last year when so many people already refi'ed. interesting in the numbers, a

big jump in the number of borrowers applying for adjustable rate loans, up 26% from a year. a.r.m.s carry a lower interest rate. one caveat, though, these a.r.m. loans are not the super risky loans of the past. a.r.m.s are fully underwritten today with strict credit and debt limits. they are, of course, riskier than a 30-year fix. more online, realitity.cnbc.com. coming up, an exclusive chat with kevin griffin of citadel. it's an interview you cannot afford to miss and it's next. stick around. so i bought ingredients, utensils, even made custom donut cutters. wow! all with points. that's how i created the ripple: the doughnut in a doughnut in a doughnut. suddenly it's everywhere. i mean, it really took off.

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well, let's talk to bob pisani at the sandler o'neil global exchange conference in new york with a very special guest. >> ken griffith, the ceo of citadel is joining us. of course, the heads of all the brokae agage firms talking abou most important issues in trading. ken griffin runs one of the largest head funds in the world. ken, thanks very much for joining us. the big topic today, one you spoke about in your keynote

address here, this afternoon, was volatility. everyone here is trying to figure out volatilities. the volumes are terrible. what's going on? what explains this? >> there's a couple questions there. number one, volatility is low because of the interventionist policies of central banks across the world. if you look at the size of the ecb, the bank of japan, we're at an all-time high. and this continued intervention by central banks is reducing volatility in fixed income markets, in currency market, and in equity markets. within the equity markets, the rise of the hedge funds, again, who are engaged in a variety of strategies that dampen volatility, is reducing your intraday moves across the entire equity landscape. so this one-two punch has resulted in a lower volatility observed day in and day out. in terms of liquidity, it's important to adjust for the fact that stocks aren't splitting in

price anymore. so if you go back 10, 15 years, your typical stock price is $20 or $30, and now we've got stocks at $1,000. >> we've got amazon. >> amazon, google. >> let me move on. you're one of the largest hedge funds in the world. i'm wondering if i can get your take on the markets right now? are we at a peak right now? where do you see things going from here? >> if we look at history, we're not yet at the end of this business cycle. what's somewhat disturbing, though, we're getting closer to that moment in time, and we're getting closer to that moment in time with yet an enormous amount of accommodative monetary policy, which means that the agrees to navigate the next downturn are going to be constrained. that's worrisome. we're also at an all-time high in terms of the federal deficit, which means that we have less resume for stimulus spending. so i think this business cycle has further to go. i think the stock market is going to go with that. but what's worrisome is the firepower that we have to address the next downturn

somewhat constrained. that should worry all of us. >> what issues should investors be focused on right now? for example, we spend a lot of time talking about the trump effect. the effect of the prosecutor for lower taxes, less regulation, infrastructure spending. is that a proper part that investors should be focused on? is there a premium in the market because of the trump effect? or is there something else you feel investors should be focusing on right now? >> so all three of the things you just spoke about are positives out of the trump administration. the growth of regulation has stopped. that trend over the last eight years has ended. and that's really good for american businesses and for american entrepreneurs. we're going to see tax reform on the corporate side under this administration. america has become non-competitive with the rest of our member states. we need to bring tax rates down not to the levels proposed, but somewhere into the 20s to make sure that american businesses remain the destination of choice for capital around the world.

on the looking forward, inflation, i think, is the big issue that we are all very complacent about. because we're in and out at a point in the business cycle, where unemployment is hitting the low fours, it's becoming harder and harder to find new workers, if we look at recent payroll data. we need to start to worry about inflation raising its head. i'm not saying it's going to happen, but the complacency has been one thing -- >> well, we've been talking about that for years. there are people sounding the alarms and we haven't seen it at all. for four or five six years, people have been calling for that alarm to be raised and betting that was going to happen would be a good bet. >> and it's very hard to get inflation when you have an incredible number of people who are unemployed, who can enter the workforce and help to put a ceiling on wage growth. but now we've got both the increase in minimum wages across the country combined with a very tight labor market. we're in a very different set of

circumstances than we were five or six years ago in terms of the inflation forecast. >> i want to go back to your comments on regulatory reform. you touched on it briefly, but in your speech, you came out and said, parts of dodd/frank are a burden to society. you said that you were troubled by the fact that goldman sachs and morgan stanley is being backstopped by the u.s. government. do you want to bring back glass/steagall? >> i would like to bring back glass/steagall. dodd/frank puts a huge cost on american banks. at citigroup or bank of america, you have 30,000 people engaged in compliance. compliance is really important. but we can't have 10% of our bank employees focused on compliance. that's mind share away from meeting the needs of consumers, meeting the needs of businesses, that we need to fuel new factories, people that pursue their dreams for college or home ownership. we need more of our financial intermediation focused on solving the real problems of society, and not creating paperwork and checking the box for rules that really have

little protective value for society. >> so just to go back -- should glass/steagall be brought back? >> i think so. >> should we stop backstopping goldman sachs and morgan stanley and bring back the old divisions? >> i think that's most appropriate. i don't understand why we believe firms that are at their core, in financial intermediation, need the support of the u.s. taxpayer. and the costs that go with that, the compliance burdens, the regulatory oversight, helps to whittle away the innovation that's so important to having dynamic, creative financial intermediaries. we don't need hundreds of intermediaries in the united states. we need a handful of super capable firms that are able to compete on a global stage, like goldman, like morgan, but we need the best of these firms brought to bear. >> you've talked a little bit about taxes. we've talked a little bit about regulation. i want to get your thoughts on trade. but first, just look at what's going on. do you have any faith that this administration can actually get things done, on taxes, on trade, on less regulation? >> so, on all these fronts, the

administration is going to make progress, right? regulation, they've already changed the course of regulatory burdens in america. no ifs, no ands, no buts. big win for the administration right out of the gate. >> you count that as a win right now? >> absolutely. >> even with nothing changing on dodd/frank -- >> breaking the trend on trade -- >> so your argument is stopping more regulations is a win itself? >> yes. because if you're an entrepreneur and you wonder what the landscape is that you're going to face, you now have stability. if you know you can make work in this environment, you can continue to enjoy the fruits of that idea. on the area of trade, the white house has huge influence over trade. they don't need to go to congress early on to help make trade happen. and i'm -- i think wilbur ross has done just a great job of trying to educate americans on our view that we need to have good bilateral deals with our major trading parties. the u.s. has been a huge proponent of multi-lateral trade for decades, post world war ii.

we did that after the war to help strengthen our allies, to help strengthen the war. we were willing to leave value on the table, that the u.s. was not ravaged by the war in the same way that a germany or japan was. >> yeah. >> jump forward 50 years, america is on the short end of too many deals around the world and we need to fight for the rights of american companies to compete globally. >> you seem optimistic? is it fair to say you're optimistic with the way things are going? >> look, every administration has pros and cons. the things that the trump administration is doing well, i'm optimistic about. it doesn't mean that it's a bed of roses, but i'm optimistic about some of the wins they've put on the board thus far. >> so you're optimistic. what keeps you up at night? what worries do you see on the horizon? >> so, i do worry that we don't fully -- number one is, i worry a lot about health care. we're doing a lot to think about who should pay for health care. we're not spending enough time to think about how to change the cost of health care. as we reach 20% of our economy

going towards health care, it's a benefit that americans don't appreciate day in and day out. it helps to fuel the sense of inequality in our country, when so much of our gains end up going to health care and not to other choices that we might want to make. we need to start to change the cost trajectory of health care. not just find out who pays for it, but how much we pay for it as a country. i worry about that. i worry about our education system. you and i both live in big cities. our cities have definitely made improvements in education, but if we don't create more college graduates with a background in s.t.e.m., we're not going to compete globally. >> great. let me go back to ken, the investor. most people don't know it, that citadel is one of the largest hedge funds in the world. i don't know if you're 10th or 11th, but somewhere up there in the biggest hedge funds in the world. you speak often about the value of simple, fundamental investing. i think people think you're just some quantity guy, but you constantly smack me down every

time i bring up that idea. bob, we're fundamental investors. so what interests you now? are there particular parts of the market that you think have great value? where's ken the investor at right now? >> so as an investor, where's the most disruptive change taking place? where there's disruptive change, there's an opportunity for investors. we're seeing incredible disruptive change in retail. just unbelievable what's happening today, the rise of ecommerce, the store within a store concepts. we're seeing a lot of change take place in retail. the tech space in the united states is just awash in change and this is an area where the u.s. leads the world. if you think about, who are the stories of the global superpowers in commerce today, it's the googles, it's the facebooks. these companies are really an interesting force for change around the world. and then in manufacturing, we're going to see this radical set of change come into play, as we start to take all of our equipment and arm it with more censors and we have more big data to help us think about when to service jet engines, or how

to get the corn into the ground at exactly the right moment to plant. the change, the rise of machine learning, the rise of ai, the rise of censoring and data collection and management is going to change manufacturing in a way that we haven't seen in our lifetime. >> you've been one of the great leaders. you mentioned ai. you've been one of the great leaders in the automation of trading. what is the end game for automatic trading? is there a day that will come when eventually it's going to be my algorithm trading with your algorithm, a higher algorithm, it will learn by itself, it will understand things? where do you see things going ten years from now? >> if you look at our business, i think actions speak louder than words, we are still hiring far more fundamental analysts than we are quads. the future of the world is around people who do really good research, they have really good judgment, they capitalize on their work day in and day out through that research and judgment. the future of finance is not

about artificial sblebl artific intelligence, it's not about machine learning. those are great tools for a market maker. but because the world we live in is so fast changing, the pattern recognition techniques that feed machine learning don't apply to what we do. here's a simple thought process. how many retailers had an online strategy 12 years ago? >> none. >> none. so if you had built an entire set of capabilities around ai and machine learning, around that transformation that no one saw 12 years ago, how would you have done? >> tough. >> horribly. >> would have lost money. where do you want to take citadel right now? you run one of the biggest hedge funds, you run one of the biggest market makers in the world. do you want to turn it into a technology firm? do you want to make it cool for kids from facebook to say, i'm going to work at citadel. what do you want to do with this giant operation? >> well, i think both those statements are already true. i think what's important to me is that we continue to exemplify leadership in what we do.

i mean, for me, that leadership that we have in the market does draw great talent to the firm. it keeps the firm incredibly vibrant, incredibly exciting, and the impact that we have on the global markets is something that's an incredible source of both pride and responsibility for my colleagues and myself. >> let's get down to the brass tacks. what's the secret sauce at citadel? people always ask me this. you have been successful for many years. you had a tough time in 2008 along with everybody else. but you've been one of the most successful hedge fund guys in the world. you talk very eloquently this afternoon about how you spend a lot of money to hire the very best talent. you're known for that. you also talk about what you call predictive analysis. that you spend a lot of money on technology, getting ideas on where prices are going. can you explain a little bit about the secret sauce? what is predictive analysis? how does it help you outperform the competition? >> so in the predictive analytic space, we're always think about what data or what information will help to be a leading forecaster of future securities prices. whether it's over the next minute, the next hour, the next

month, or the next year. and we have made a huge investment over the years in big data, in machine learning, to understand how we can best forecast the evolution of securities prices. >> i want to leave you -- i know you've got to run, but, advice to investors. put on ken, the market guy. where are we going to be in the next six months? what do you want to tell the cnbc viewers who are all investors out there about what's going to happen in the next six months? >> so the outlook is partly cloudy right now. it's sunny, but partly cloudy. as i said earlier, we're getting into the later innings of the business cycle. and that always gets to be a bit more treacherous. one thing to keep in mind is the central banks around the world have really encouraged all of us to take undue risk. one of the explicit goals of qe, of zerp, our zero interest rate policies, is to push up asset prices. and we've been doing this now for eight or nine years. so it's a bit worrisome --

>> is the fed going to make a successful transition? >> the u.s. economy can certainly make that transition. it's the knockout effect to the rest of the world that's worrisome. it's brazil, china, do these countries, does italy have the ability to absorb the impact of tighter monetary policy in the united states? that's the question mark. >> ken griffitn, thanks so much for coming on. don't be a stranger and come back. >> thank you very much. >> ken gingrich, the criffin, t citadel. we're here all day at sandler o'neil. >> bob, thanks so much and our thanks to ken gingrich, as well. a lot of interesting points coming out of that. thinks there could be more room for upside on this, but concerned about the potential for inflation to get away from the feds and how other markets will react once the fed does start raising rates. >> complacency surrounding inflation is what worries him most. i was most fascinated about

investmethe investments, the facebooks and amazons of the world, those are among his top holdings in his portfolio, as of some of the latest filings out there. we just had this stat about the cues, there was all this money going to the cues. the biggest inflows in a very long time coming out of the xak, because people wanted the amazons and facebooks of the world. he's finding some opportunity there, as well. >> of course, ken is going to give you about half, maybe that, you know what i mean? and i wonder, melissa, you know, if he is worried about the fact that everybody is going to go into the triple qs because five stocks make up 40% of that index. and you wonder about that collection at the top. the other thing i wish griffin would have said. bob said, what's your secret sau sauce? if he would have answered thousand island, that would have been classic. could have gone to humanize him. i'm just saying that in media training. >> of course, you have burgers on the brain. >> apparently you have it in the

mouth. because you've still got a little burger -- >> i hate the entire burger. >> so did i. >> griffin is a guy, he doesn't talk a lot. he wants to be viewed a little more now as a statesman. he's talking about health care. he's talking about these big-picture issues. you're talking to one of the wealthiest self-created men in the world, as well. let's not -- he began trading high-yield bonds out of his harvard dorm room. >> just like me. or not. >> just a typical friday night at harvard, right, melissa? right, melissa? >> could be. >> how about them apples? >> still ahead today, they made craft beer before it became a thing and they are part of this area's iconic conference. we're talking the beer business with brooklyn brewing business's cofounder, steve henry. that's next right here on "power lunch."

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business. one of the businesses in attendance is brooklyn brewery. like all great brands, they started small. joining us now is brooklyn brewery's cofounder, steve hindy. i don't know if you remember, about six or seven years ago, i spent the day with you out at your brooklyn at your facility. had a double couple of beers to. >> oh, yeah. >> good to see you. whether the business is brewery, clothes, doesn't matter. if you were to offer up one or two of your best pieces of advice how you got to small to where you are today to our audience what would it be? >> i think the number one quality, important quality for any aunt pra pentrepreneur is p. everyone is flattering you, everyone has ideas for you, and there are a lot of temptations

that take you away from your original vision and mission. you've got to stay focused in those early years if you're going to succeed. >> how do you do that, though, steve? i imagine you fay all kinds of hurdles, not only growing your business but grow it in new york, some of the toughest regulatory environments, traffic issues -- it's not an easy place to start a business. how do you keep the optimism up? >> well, you have to. >> with beer, that's the answer, steve! i gave it to you. >> well -- well, that's true. that's true. the beer certainly helps, but, you know, i can't tell you how much pressurer there is in the beginning, because you've taken money from family, from friends, and you want to succeed not only for yourself but for them. you don't want to disappointment them. so it is kind of a

pressure-packed period of your life, and for me it probably went on for about 15 years before i really felt comfortable with the future of the company, and confident about the future of the company. >> listen, steve hindi, we'll let it go there. you're a great story. an american success story. a delicious story as well. steve hindi of brooklyn brewery. thank you so much. breaking news to get to with eamon javers in d.c." >> reporter: long-awaited testimony of former fbi director james comey released by the senate intelligence committee. in it, the former fbi director goes through point-by-point, day-by-day each of his interactions with president trump, and there's some astonishing moments in here that the former fbi director details. he says he first met then president-elect trump friday january 6th in a conference room at trump tower in new york. talks about his briefing on the so-called dirty dossier in which they told the president-elect what was in that dossier.

he said the reason noor was we knew the media was about to publicly report on the information, and also he says to the extent there was an effort to compromise an incoming president we could blunt any such effort with a defensive briefing. i want to give you the -- what the former fbi director says here in the context of the prior, the january 6th meeting. he said, that he talked to his staff whether or not to issue an assurance to the president of the united states that he was not under investigation. he says, this was true. we did not have an open counterintelligence case on him. he says we agreed that as he and his staff, i should do so if circumstances warranted during our one-on-one meeting at trump tower based on president trump's reaction to the briefing and without him directly asking the question, i offered that assurance. there is more details in here, brian, about the dinner that they had and the moment that the president said to former fbi director comey, i need loyalty. i expect loyalty. comey says, i didn't move, speak

or change my facial expression in any way during the awkward silence that followed. we simply looked at each other in silence. the conversation then moved on, but he returned to the subject near the end of our dinner. we'll continue to go through this testimony here, brian, a bring you all the important details about what the former fbi director now fired is saying about the president of the united states, brian. >> all right. eamon javers, thank you very much. sure to be scrutinized and, of course, the heat likely coming from the q&a section of that. >> seven pages released. and refurbishing the good, bad and ugly. that's next. no splashing! wait, so you got rid of verizon, just like that? uh huh. i switched to t-mobile, kept my phone everything on it oh, they even paid it off! wow! yeah, it's nice that every bad decision doesn't have to be permanent!

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former fbi director james comey releasing his written testimony set to be released tomorrow. more on the breaking news headlines, going through the testimony right now and be back in just a moment. if you have medicare

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remember - these plans let you apply all year round. so call today. because now's the perfect time to learn more. go long. welcome back. topping your news menu at this hour, president trump in ohio trying to pave the political road for his trillion dollar infrastructure plan. america has to get its act together. tough words from diamond. and the second hour of "power

lunch" begins right now. and check out the movers in today's sex. energy stocks, big drag is oil. down more than 4% off the back of inventory numbers. among the top decliners, financials meantime leading the day, goldman sachs and jpmorgan among the top and names hitting all-time highs, colgate, united health, johnson & johnson and sales force. breaking news. in the last few minutes former fbi director james comey's testimony for tomorrow's hearing released. daimon javers is reading through it and has details. eamon, what's jumping out? >> becky, comprehensive and detailed testimony from the former tfbi director going through point-by-point each of the contacts with president trump. what president trump said and details in cases which door of the room mr. comey went in and out of. who else was there. who was in the hallway, outside of room. comey here clearly trying to

establish a witness base that could corroborate the existence of these meetings and also saying what each person said, including on a february 14th oval office meeting he details here, saying the president signaled the end of a larger group meeting and by asking everybody else in the room to leave, he says jared kushner was the last one to leave the room, and then when the door to the grandfather clock closed and we were alone the president began by saying, i want to talk about mike flynn. flynn resigned the previous day. the president began by saying, flynn hadn't done anything wrong in speaking with the russians but had to let him go because he had misled the vice president. further down, comb you says the president returned to the topic of mike flynn saying he's a good guy and been through a lot. recented that flynn hadn't done anything wrong on his calls with the russians but misled the vice president. he then said, i hope you can see your way clear to letting this go, to letting flynn go. he is a good guy. i hope you can let this go. i, that is comey, replied, only

she a good guy. i did not say i would let this go. additional detail here from the former fbi director says that, at some point he spoke with attorney general sessions about his, the president's concern about leaks. he also told sessions what it happened in terms of the president's conversations with comey and he said, i told the a.g. what just happened. him asked to leave while the fbi director who reports to the a.g. remained behind was inappropriate and should never happen. he did not reply. that is, sessions did not reply to comey's objections to the president having a closed door meet wig the director of the fbi. a lot of detail here to bring you up to speed on, becky. importantly, comey does say here he began these memos immediately after these meetings saying at one point he left trump tower got in an fbi vehicle and immediately began typing on a laptop to get the freshest possible recollections of what the president had said to him, and he said that was usual practice for him.

he did not do that with president obama but felt he had to in the case of president trump. >> goes on to say he felt very uncomfortable the situation and wanted it on the record. eamon, thank you. we'll continue to read through. and "power lunch," a few moments ago spoke with ceo of citadel. bob pisani? >> ken griffin, ceo of citadel, biggest hedge funds, and started talking what he felt there might be storm clouds on the horizon and what investors should be watching. surprisingly he signaled out inflation and what he had to say about that inflation worry. >> looking forward, inflation i think is the big issue that we are all very complacent about. because we're now at a point in the business cycle where as unemployment is hitting the low 4s, it's becoming harder and harder to find new workers, if we look at recent payroll data.

we need to start talking about inflation raising its head. not saying it's going to happen, but the complacency about inflation is really, i think, the one area investors should be most worried about. >> we've been talking about -- then talking a lot about regulatory reform saying dodd/frank was a burden to society. those are his words. he gave the trump administration credit for at least stopping what he called the ever-increasing spiral of regulations. and glass siegel. troubled by the fact goldman sachs, back stopped by the u.s. government. what he said about bringing back glass steagle. >> i'd like to bring bag glass steagle. dodd/frank puts a huge cost on american banks. citigroup, bank of america, 30 engaged in compliance. compliance is really important but we can't have 10% of our bank enemployees focused on compliance. mind share away from meeting the needs of consumers and

businesses that we need to fuel new factories, people pursuing dreams for college or home ownership. >> we also talked a lot about tax cuts. he said, u.s. corporations are currently uncompetitive, but did not support 15% as president trump is prosing for the current corporate tax rate. he supported something in the area of 20% to 25%. also spoke about trade. he said free trade, when he grew up, was the prevailing ideology. what got lost, america could not be a party to leaving agreements on the table where they were simply on the losing end, and gave props to wilbur ross for focusing on fair trade agreements. basically supporting the concept behind much of the trump administration's ideology on fair trade. a wide-ranging discussion, fascinating and don't often hear from ken giffin. back to you. >> we don't. a great interview. i was most fascinated by where griffin is finding opportunity in the markets. surprised me a bit he touted the stocks a lot of investors call crowded now.

the amazons of the world, pricelines. specifically and he specifically mentioned stocks that don't split, $1,000 stocks and march filing, biggest positions in amazon and priceline. >> yeah. i think his point was, he's extremely big on the companies that are utilizing the most modern technologies. artificial intelligence, obviously, and invading and disrupting their own particular spaces. so given that he feels there's still room to go and these technologies, these companies are so dominant in these technologies in their particular space, that probably backstops his idea of not being terribly worried about the price is right now. >> hey, bob, thank you very much. >> okay. all right. elsewhere, some good news for the globe in all of its residents. the latest forecast from the oecd predicting a pickup in global growth making it the best year since 2011. steve liesman, smiling. >> because i get to bring the

good news. this never happens. >> for seven years there, just -- >> eight, nine, ten -- all bad news. investors focused on all the washington intrigue might miss a bigger story here. bigger macro story may be underpinning this strong market. a report today global growth due to a modest upturn projected in 2017 and '18. neutral in '17 but expansionary in 2018, and sees the ecb tightening in 2018. the numbers, oecd raising economic growth forecast 3.5%, better than the 3% for 2016 and the same 3 for the next year. 2017, 2018 growth for the eurozone you can see up near 2%. we'll take that. united states up a little bit from this -- in to 2018 from '17, down from the prior forecast moving the fiscal stimulus in 2018. better fon investment overseas. heard a lot of that on this and

other shows. overseas growth helps the u.s. economy. ricochets back, boosts rdgp and underpin what's going on. center the last five years, europe, japan a drag, when everybody was a drag. >> another voice into the conversation, austan goolsbee, former chairman of the council of economic advisers for the obama administration and university of chicago's booth school of business professor and austin what do you think? good news that comes back through. you expect those good times to continue? >> well, it's always about the forecast, and all i would say before everybody breaks out the party hats is, we've had seven or eight or ten or some number of years in a row where both the fed and the oecd and the imf have said, not this year, but next year and the year after, the growth rate is going to go up by some significant amount, and when it actually came to

those times, it didn't happen. so i will be thrilled if this does take place, but i would be also circumspect about making these predictions. >> and it is happening, right? you have to admit numbers out of europe have been better. i wouldn't have made so much out of this report, i agree with your recounting of history here. if the numbers in europe were in fact better and instead of zeros puts up near 20s in europe? >> look, i hope that that lasts. but, steve, you got to admit -- >> taking dismal science to a new level. >> 30 degrees and raining? >> good grief! >> go ahead, austin. sorry. >> whether italy, greece or some of the other trouble spots in europe, they've been getting decent data, but if you ask how sustainable is it, i think there are still questions about sustainability. >> let me ask this. >> there's nothing bad -- nothing bad in this report. steve's totally right. that the news that has come out

is good. i just -- i don't know how good the news is, because it's similar to the kind of news they've given in the past. >> and throw into the kwhoofrgs we heard from ken griffin. concerned about inflation as a result thinks the fed will raise interest rates. and then he's concerned not how the u.s. economy handles that but how countries like brazil and china deal with something like that. steve, your thoughts? >> there's going to be change, and the change going to be affected by what -- by what the fed is going to do. but if these other countries don't know what's happening. this is a road in arizona. it is -- you can see as far as the road goes. >> may know what's coming but that doesn't mean you're prepared -- >>horizon? six miles at ground level? sometimes in arizona an armadillo walks across the road causing a car to skid into a ditch. what you're worried about, right?

>> a view of the sandstorm coming from a far distance. in emerging markets, whether it's brazil, whether it's china or in some of the other emerging market theaters, there's a lot of variability. and if you look at the debt explosion, really, that's taken place in china, they may be able to manage that into kind of the soft landing, but they might not. and if they don't, then you know, the sandstorm will blow that road off the, off the map. >> austin's half-full glass has a leak in it. >> and dust and some sand. >> austin, can you ascribe a percentage risk to your sandstorm analogy or the armadillo? we get the point. what is the economic risk? 5%, 10%, 20%? something throws us off this course. >> steve what do you think? i think for china, 10%. definitely not zero, but definitely not 50%, and in china they're thinking a lot about it, but they've had a massive run-up

of debt. and the past history suggests that when you have these big run-ups of debt, they don't end in soft landings. >> i think that's fair, austin. i do think again, the fed has given a lot of notice what it's going to do. the ramp is not steep and i think that's important as well. i also think, you know, ken griffin may be worried about inflation, but there's a lot of concern on the other side now and i think the bond market's on my side when it sees less inflation now than certainly thought in january, or last year, and so i'm not that concerned about inflation. if we get inflation, remember that was probably going to mean commodity inflation that will help the same emerging markets who ostensibly have trouble paying debt . >> i agree. becky know, the seam people have been predicting imminent massive inflation, for the last eight years. and it hasn't come. on that one, too, i think we should be circumspect about making predictions. >> lousy weather in new york but don't turn like that.

like they do from chicago. >> you know what? call it like he sees it. austin, thanks for joining us. good to see you. >> great to see you. don't forget about the stock market open for business. major index seeing a spike following release of james comey's testimony. dow jones industrial average, not higher, turned around a little. at least according to testimony the market did not get any kind of a "smoking gun." nothing all the computers and traders saw that would make them worry about anything regarding the trump agenda, congress woha have you. i remind you, q&a tomorrow is probably going to be where the access is, but opening statement, melissa, fairly sanguine reaction. >> and session highs on back of it. coming up on "power lunch," drop in oil. dennis gartman up next. auto loans mortgages and especially student loans. a debt threat to the economy? back to iconices talking to cosmetics queen bobbi brown.

all that and much more coming up on "power lunch." oil briefi

the $46 level. crude traded as low as $45.53 before. bring in editor and publisher of the gartman letter. dennis good to see you. >> good to be seen. thank you. >> reaction to the inventory numbers? >> obviously reaction to today's inventory numbers.

surprisingly large. not just the crude oil number itself. most people expected that there would be a draw by the eia and instead an increase in crude inventories and also in distillants and gasoline. the aggregate sum up over 10 million barrels. quite a large increase. let us remember, last week you had a material decline in inventorie inventories. like stocks sometimes there's corrections. nonetheless, a bear market. continues to widen. crude oil bids for storage and supply continues to outstrip demand. still a bear market in crude oil and probably still heading lower, i'm afraid. >> put this in context with moves of the other commodities we've seen. basically we've seen, you named the commodity. seen it roll over. iron orr. is it telling us something the stock market is ignoring? >> don't get carried away with

too many commodities. wheat is higher. corn seems to be going higher. livestock prices are in an abundant, bull market. the basic materials, steel you said, iron orr, and even the supply of shipping is in some straits. it's not as if it's an egregious bear market across the entire universe of commodities. just in the ones that really, if you do drop them on your foot are really going to hurt. >> exactly. to use your phrase. but the same time, dennis, the commodities not long ago we would view them as a barometer for economic activity. dr. copper, not dr. soy. >> it is a problem. not just dr. copper it's tin, zinc, aluminum all under some due ress. the metals are demonstrably weak. on the other hand gold made a new high the past several months doing quite well. the industrial commodities. >> sell off in industrial commodities? does that tell us something, or

no? >> i'm not sure. i think that the report that just came out from, from the world bank, i guess it was saying we could have the economic growth around the world of 3.5% is at least a sign of some optimism. they have -- again, as was just recently discussed, they have missed their estimates for the past several years and always been too high. is the global economy slowing down? no, i really don't think so. and the economy here in the united states slowing down? no. but you have to pay attention what's going on in industrial metals. >> economy is good in most places. especially the united states. you can always find pockets. does the comey testimony tomorrow from the possible outcome of derailing all of this? or is it a -- an important, very important but an important side show? >> well, you all have been reading the pages that have been released. i didn't see anything in there untoward. i would suspect tomorrow will be relatively a disappointment.

everybody is expecting to have some sort of excitement from tomorrow's testimony, and it may instead be rather, rather sanguine, as you said earlier on. >> all right, dennis, leave it there good to see you. thank you. >> thanks, much, mel. >> dennis gartman. airline stock one analyst says will fly higher from here. that name and why in "star trst talk." we'll be right back with cosmetic artist bobbi brown joining us. stick around. welcome to the iconic

conference in new york city. hundreds of entrepreneurs gathered today, new and starting others here to network and grow. all have the opportunity to learn from proven business leaders. one thing no common making the moat of every moment right here. lighter at iconic. >> welcome, ladies and gentlemen, to iconic. >> the akiconic conference is s up to interact with each other, form valuable networks and really get inspiration from so many great people onstage. >> starts with you the person. what is it about you that really freakin' blowing your hair back and that you're really good at. >> people are hungry to make connections, make new things. >> probably the best advice, the ceo that said it. >> have an internal mantra, listen hard, change fast. that's pretty much all you need to know about scaling a business. >> it's really important for organizations to learn how to listen hard, change fast. agility is everything in the

21st century world. >> a plethora of entrepreneurs and leaders here. sometimes you have to be in like a melting pot. you don't want it always the same industry. yeah. i love the diversity here. wonderful. >> risks you could fail. how did you think about that? >> failure is not the opposite of success. it's a stepping-stone to success. >> sometimes it's not the deal that we didn't take. it's the deal we did take, that takes a lot of our time. >> as an aun pra pra nuer opt t pra nuer trying to be perfect. >> it humbles you, opens your eyes and i'm happy to be here. >> big names ready to hit the stage. head over to cnbc.com forward slash iconic for all the action. we'll be right back in 30 seconds. e that? uh huh. i switched to t-mobile, kept my phone everything on it oh, they even paid it off!

wow! yeah, it's nice that every bad decision doesn't have to be permanent! now you can ditch verizon but keep your phone. we'll even pay it off when you switch to t-mobile. time for "street talk." stocks you need to know about. dr. pepper snapple, outperform, raising price toorgt 105. 15% upside from the stock's price. clarity on the trajectory and sustainability of bey. bey brands. >> actually some of my neighbors. >> really? started the company, sold it for billions. congratulations. >> solid momentum, legacy business, reason for upgrade. worth noting downgrading coca-cola and pepsi to market

performs. >> and central new jersey dennisons built out the business of trenton. congratulations. united continental not an upgrade. ubs more optimistic boosting target 103 from 95. 25 outside my friends, margins expanding more but say the stock upside even if margins simply hold steady. analysts think 10% to 15% higher than most the street expects and believes some of the recent improvements in operations will stay strong. interesting, surveyed about 1,300 united employees on glassdoor.com and found morale improved. could it have gotten worse, though, is the question? >> since the dragging incident. not sure the time frame, but up from whatever bottom was in. >> whatever it was. next up, activision. morgan stanley raising price on both sides. 57 to 126 from 114. analysts believe stocks are still under valued relative to cash flow. rising digital in-game

monetization. >> buying real stuff with real money to keep your dragons alive. >> buying fake stuff with real money. think of the margins on the fake stuff! >> real margins, not fake news. real stuff. all right. your final call of the day, ormat technology. ora is the ticker. reno, nevada based company, geothermal, nat gas, pipeline servicing. upgrades poor mat over weight to neutral and target bumped up to 17 from 65. 20% upside. analysts say the company well positioned to post revenue growth and margin expansion nationwide. notes backlog peaked two years ago. stabilizing nicely. format, no doormat. >> what a one-year performance. >> reno, nevada's finest ormat. >> that's "industry talk." back to you. and student loans, up to our

eyes in debt again, and is it a threat to the economy? plus, a big slide for oil prices. closing trades are moments away. stick around. we'll be right back.

hello, everybody. i'm sue herera.

here is your cnbc news update for this hour -- bill cosby's chef accuser de denying they had a row machmant relationship before he allegedly drugged her and raped her at his home. she broke her long public silence about the alleged assault. at a briefs house speaker paul ryan commenting on president trump's choice of christopher wray as the next fbi director. >> i don't know the guy, but i've looked at his resume. seems like the right, perfect seems to me the perfect kind of person. i thought we should have a career person take over the fbi with a deep bench of experience. he certain seems to fit that bill. >> fascinating study. brain scans may help detect autism in babies long before they show any symptoms. north carolina university scientists studied the brains of 59 6-month-olds way family history of autism and identified specific brain patterns in 9 out

of the 11 children eventually diagnosed with the disease. that's the news update this hour. becky, back to you. >> sue, heavy stuff. thank you. breaking news in the past hour. former fbi director james comey gearing up for his testimony tomorrow and his written testimony has now been released. eamon javers is back with more details. does it leave anything left for the questions tomorrow? >> sure. the obvious question i'm sure i will see tomorrow is whether or not comey thinks all of this amounted to obstruction of justice on the part of the president of the united states. he does not say that, and he says that he thinks that the president asking him to drop the mike flynn matter only referred narrowly to mike flynn himself, the former national security adviser, at not more broadly to the overall russia investigation. that's a positive point for the trump white house as they scour this document at the same time we're scouring it'sthe vivid detail in here is what's going to get a lot of attention around the world tonight and into tomorrow, including this moment

when comey says that the president asked him for loyalty. he says, the president said, i need loyalty. i expect loyalty. i didn't move, speak or change my facial expression in any way during the awkward silence that followed. you imagine seeing there, where the fbi director and president of the united states sitting across from each own one-on-one, nobody else in the room. essentially a staredown between the two men as the president's demarchding loyalty and the fbi director is refusing to give it. one other key point here. the white house has said if what comey knew was so damaging, why not go public with it in the first place? comey answers that question here. he said that they agreed that he and his leadership team agreed it was important not to infect the investigative team with the president's request, which we did not intend to abide and concluded given it was a one-on-one conversation there was nothing available to corroborate my account. two reasons by comey why he

didn't go public with this months ago. one, he wanted the investigation to continue without the investigators knowing what the president was requesting here. the other, the conversations, nature of them being one on one, no way to prove it given it a he shed l said/he said conversation. >> and back in february asked something along the lines, where, is this a situation you feel like you've been pressured? he said, no. i never felt like i was pressured. after he started taking notes in january. >> right. >> that's the thing we have already heard time and time again people now trying to -- poke holes in it. trump loyalists say it's a way of saying that he's a person who's got a grudge because he was fired. >> yeah. look, the former fbi director here says very much that he thought that the president's actions were concerning. i think he says very concerning, the exact, the exact wording. and this very much reads as if the fbi director was looking around the room at the time that these meetings were happening,

looking to establish, who else was in the room? who could corroborate the fact that this meeting was taking place? at one point notes reince priebus, white house chief of staff ducked his head in the room and the fbi director could see others gathered behind reince priebus and the president motioned for him to close the door and another point says the dinner ton eturned out to be jue two of us at a small table in the green room. two navy sturpstewards waiting entering the room to serve us. and investigators who want to go back find out in the meetings really happened, could track down those navy stewards. ask the chief of staff, ask the people standing in the hallway behind the chief of staff. all that important evidence building here in this document. >> yeah. >> eamon, thank you. obviously a lot more to come before that actual testimony tomorrow. >> absolutely. >> meanmeantime, less than 90 minutes from the closing bell. stocks turning positive since

the re-release 6 coof comey's testimony. s&p 500, real estate stocks. a group we don't talk about often. some of the stock prices you can see now. oil market closing for the day. over to jackie deangelis at the cnbc commodity tedesk. a wild ride today jnchtsd. >> a rough day. and inventories and products, remember, not supposed to see that this time of year. prices dropped about 5% at the close. session low more troubling. $45.65. it's more than inventories, though. also the most recent data showing that opec production is rising. some of these countries just can't take the revenue loss from making these cuts. it's also that u.s. rig counts are up and output going up as well and falloff and demand is counted on this time of year to see seasonal support. today we saw prices closing

around $45.85. back to you. >> all right. jackie, thank very much. a big drop in the number of subprime auto loans written. could it hurt car sales? phil lebeau joins us now from chicago. phil? >> this is going to hurt car sales. looking at an industry slowing down overall for a creator of factors. data from the first quarter, show you from experian, a definite slowdown in the number of loans written for those with the poorest credit records. talking about subprime and deep subprime. could it be lenders are hearing the message they were getting too aggressive in terms of writing loans in the past? here's what experian has to say -- >> i think it certainly caught the attention of the industry. especially those that relied upon markets for funding. so certainly if those losses were increasing, it did signal an alert to other lenders. so it definitely could have had an impact. >> and this is not the first time we've heard from dealers

about tighter credit standards that certainly are filtering into the showroom. in terms of what people pay for auto loans, new vehicle, average, $509. used vehicle, $363. guys, that's the biggest gap we've ever seen from experian between new monthly payments and used monthly payment. finally shares of one of the largest issuers of auto loans. particularly when it comes to subprime borrow others. been a rough ride for these guys. settled a couple cases earlier this year that a couple of states launched in terms of who's checking the background of those who are taking out the subprime auto loans. bottom line is this -- we are seeing tighter credit standards writing loans in the showrooms. >> phil, interesting stuff there. thank you very much. well, it's not just auto loans. all kinds of consumer tete debtn the rise. credit cards, mortgages and

student loans. how can think contradict and otherwise healthy economy? blackrock, an interesting question from blackrock, rick, higher student loans americans buying more homes. this stuff is good until it's not. will all of this credit out there ultimately constrict growth? >> yeah. i think it will. one of the things i think has happened in the last few years, household debt has generally come down. mortgage debt particularly. household debt has not nearly grown as much as in the past credit card debt, student loan debt has growth precipitously and the one people will talk about the next few years that will drag on the economy. not create a crisis, but something that will have significant ramifications. largely held on the government. one that will drag and particularly, think where consumption is in the economy today or always, it's in that 25-year-old to 40-year-old age

bracket where -- that's the place you're burdened by student loan debt. >> the demo, rick, right? because the advertise approach -- a lot of that, some of that, will not be paid back. there will be a, unfortunately a different impact there, but that also assumes that other costs may not come down. you know? i wonder, $200 in payments, maybe other things deflate. technology costs come down. it balances out. able to quantify the overall impact. a couple things. one, very difficult. because it gets at there's so many different contributions. by the way, the one we talk a lot about technologies impact on things like apparel, food, et set r bringing down the cost. frankly, so much discussion about inflation, how that it dragging down inflation, good for the consumer. hard to quantify how much you actually bring down what is consumption over the next few years. where you see a tangible impact, where your first-time home buyer

emm anates from, significant dr in home builder and why they're not building nearly the levels historically because of the forward look in terms where that cohort will be a consumer of homes and how they get credit similar you described in the last segment. a tightening -- >> rick, you mentioned student loans, s 1.6, debt, $12.7 million, and percentage of debt overdue, risen two straight quarters. we're seeing a picture of people borrowing a lot of money on credit cards, ought "loaauto lo student loans and feeling the debt. what is the bigger impact if burdened by a debt load? >> it is significant. you've seen, you see it play out. certainly played out the last few years. i argue you have to balance that with running unemployment of 4.3, trending lower. in pretty good shape with the

economy. the drag is significant. i think going forward we'll talk more and more what people will attribute what is an economy that's not growing as fast as people would like. that consumption basket you talked about is going to be burdened and like i say, the student loan was is the one that's the most prolific. certainly where we were versus a few years ago versus the mortgage debt, not nearly as aggressive, but the student loan is and will drag on the economy. >> rick, blackrock, leave it there. always a pleasure to get your views. big topic not going away anytime soon. see you again. >> thank you. and folks, shares of cosmetics up 20% this year. big money in makeup. our next guest knows all about it. we'll talk with bobbi brown right after this break. hey gary, what'd you got here? this bad boy is a mobile trading desk so that i can take my trading platform wherever i go. you know that thinkorswim seamlessly syncs across all your devices, right?

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welcome back, everybody. cnbc and "ink" magazine joining forces to talk entrepreneurship and latest businesses at the iconic business in new york. joinings now one of this year's speakers bobbi brown. an entrepreneur and founder of

bobbi brown cosmetics. great to see you. thank you so much forejoining us. >> thanks for talking to me. >> you know, you are somebody who is truly iconic. smoob has not only made it as an entrepreneur, re-invented yourself time and time again, different lines from makeup to books, to advice and health and wellness and beyond. i just wonder, is there any sort of drn-use the phrase earlier today secret sauce, a farm la y formula to use being successful as an entrepreneur? >> the answer is, no. the suggestion do what you love. try different things and don't be afraid. >> how much of what happens is hard work? how much is just showing up? how much is luck? does all of those -- do all of those things factor into being successful? >> it's honestly a little bit of everything. the secret sauce is just knowing what you love, taking chances, and i love doing things that i

don't know anything about, but just doing it, something different. >> doing something different. things you don't know anything about, sounds crazy. but what do you do? show up and ask questions and plow ahead and not know what it mean? to not know the rules is maybe advantage. you won't follow the same steps people have done in the past. >> well, it's not necessarily not knowing the rules. it's making your own rules. so making your own rules is just doing what you think is right and trying to do things different, and that's what being an entrepreneur is. re-inventing. >> ever times in the past when you were walking down that path, creating something, where you got nervous about it, didn't think it would work and plowed ahead anyway? >> most of the time when i think something's going to work it does. if i don't know it's not going to work, i might change direction. so whatever i'm doing at the time i feel confident that what i'm doing is right, but if it's not working, i might be shifting a little bit to do something different. >> when did you know that the line of cosmetics you've come up

with, which were so different than what was in the industry at that point, coming up with more natural looks, things that made women look better, not necessarily look like they were heavy duty made up. when did you know that would be a success and there was a real market for that and real demand for that? >> well, i knew before i even started selling them that it was something that i really loved and all of my friends and the models and editors wanted it. so i knew i had something there. i really knew it was going to be successful when i went into my first store, which was bergdorf goodman and we sold out. >> wow. bobbi, you are no longer with the makeup brand that you created. you left es estee lauder. what is it like working for a big economy ask stifling or things that are fantastic about it, too? >> i stayed 21 years after i left the company and i guess the way it worked for me is i thought i still owned the

company. i always tried to do things more creative way. i guess you could say intrapreneur, bring differ things to the mix and why we were so successful so long. >> and sounds like it's the type of thing where you are a curious person, an interesting person and an interested person and that's the way you live your life and what's successful? >> you know, i'm very curious. i like to try new things. i like to learn a lot. but i'm also really practical. for an entrepreneur that is just someone that's in the clouds, i'm not. but i have a lot of ideas, but also really simple and practical. i kind of know what women want. i'm -- i'm a woman, and i'm busy. so i know women want things that work for them. >> right. bobbi, thank for your time today. a pleasure seeing you. >> you, too. thanks. so nice to talk to you. all right, a baseball player, you probably have never heard of, did something last night that has only happened six

times before. so now you're going to hear who this person is. also shares of alphabet/google 26% so far this year crossing the $1,000 per share mark first-time ever. where does google go from here? "trading nation." stick around.

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a rare feat in baseball last night. scooter jeannette hit four home runs for the cincinnati reds. apparently, becky, your cohost, likes that team. he did it in four consecutive at bats. that makes scooter and jeannette only the 17th player in history tho to do that. j jeannette had only three home runs all season before last night. millions of children will be named scooter jeannette starting today. alphabet's shareholder meetings this week. the stock breaking through $1,000. the question is not where it has been, but where it is going. let us ask the "trading nation"

team. ari wall of oppenheimer. obviously, a lot of memo in tom the name. i know that. does the chart show any sign of breaking down? >> it doesn't. and that's why we like it, brian. the stock scores very high in most of our momentum rankings. we like momentum. for that reason, we still like google and expect it to go higher. i think to tell the story in the chart, you've got to look at the relative performance, relative to the market, reflative to the s&p 500. and google had been in this 18-month narrowing range versus the market. more recently, the stock has broken out to the upside. we think that is marking a resumption of longer term outperformance in a rising market cycle, to boot. we recommend buying shares. >> boras schlossberg, ari recommends it. do you? . >> i do. i have an all-mac household, but every single major app of every one of my computers is that

google app, from search to maps to youtube that my daughter watches. and i think no company owns the consumer mind space as much as google does, with the exception perhaps of facebook. and that's why there's so much promise in them going forward. they're just very, very dominant in every space that they're in. and i don't see any threat to that dominance going forward. >> all right. a fundamental view there. ari wadd ari likes it on the chart side now. guys, thank you. for more "trading nation," go to tradingnation.cnbc.com. "check, please," is next. >> announcer: the latest from tradin tradingnation.cnbc.com and a word from our sponsor. >> every trader should know that losses are part of the process. so in an effort to reduce your risk and define your max loss, consider using static stop or trailing stop orders. this can help eliminate emotion from your decision making the and set you on the path to consistent trading.

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for a free quote today. liberty stands with you™. liberty mutual insurance. . welcome back, everybody. pinterest raising $150 million from existing investors in its latest round of funding. that values the company at $12.3 billion. pinterest was last valued at $11 billion after raising more than $360 million back in march of 2015. a spokesperson says that the new capital will be used for global expansion and to invest in visual technology. in february, pinterest launched a new tool that's called lens to try to boost ad revenue. >> can i ask you a question about pinterest. >> you may? >> what is pinterest?

>> oh, it's cool -- you find all kinds of cool -- i used it when we were doing renovations to find colors for bathrooms and cool ideas and stuff like that. >> don't you use houzz? >> no. >> but pinterest is also recipes and crafting. >> i check eed it out once and someone said, you're a man, you're not allowed to have a pinterest page. >> guy adami has a pinterest page. >> that doesn't surprise me. >> that's why i said it. >> i fear no adami. apple has gone hollywood. it released a new reality competition show last on itunes called "the planet of the apps." get it? it's apple's first move into original content. the premise, contestants pitch their idea for, you guessed it, an app to a panel of celebrities for a chance to win a spot on apple's app store. it's a ten-episode series and will be released on the music app. >> sounds an awful lot like "shark tank." >> exactly.

>> app version. >> i'm glad you don't fear guy adami. this friday, "power lunch" is getting into the delivery business. place your order for the names you would like advice on. e-mail us at powerlunch@cnbc.com. our experts will tell you whether you should buy, sell, or hold the stock and guy adami will be joining us. >> i love guy adami. >> so you can bring up that comment directly. >> i didn't -- no, no. you brought up guy adami, by the way. >> no, no, no -- >> you said no man has a pinterest page. >> i didn't say that. i said i checked it off and was told to get off. it was a comment -- it was a joke. guy adami and i will go out for cereal later. >> check, please! >> james comey testimony tomorrow. the testimony could move the market. >> and ken griffin had a lot of interesting comments on "power lunch" here earlier today. what he said about inflation, something that he is starting to get a little concerned about is

sympathetic he cou something we should watch. and he said the stock market has more room to run. >> and tesla, another record high. 360.50, had its shareholder meeting yesterday, talked about the model-y and serious consideration into building a new plant for that model-y. sounds like a lot of money to be spent by tesla. thanks for watching "power lunch." thank you, becky, for joining us. >> thank you. >> "power lunch" -- "closing bell" starts right now. hi, everybody, on a wednesday. welcome to the "closing bell." i'm kelly evans at the new york stock exchange. >> doesn't feel like wednesday for all of us. >> friday. >> i'm bill griffeth. former fbi director james comey's written testimony for tomorrow has just been released. maybe you've heard some of the spots. we'll wribring you details on w he is intending to read ahead of his much-anticipated appearance before the intelligence committee tomorrow. and we have two wall street heavyweights joining us, howard