that they are eating their lunch and then some. >> that's a peace offering to jimmy. >> amd is just killing it. brought weekly called, beginning of the week, just boom >> give me a name. >> shouts of prod igy rest in peace. >> "power lunch" starts now. be carusso cabrera uper's ceo and founder is out. if uber was publicly traded would the stock be higher or lower today? president trump's buy america policy getting support from an unlikely place, china. alibaba on why made in america could be the gateway to china. and latest auto quality ranking hitting wires right now. winners, losers and more fasten your seatbelts because a refed up edition of "power lunch" starts right now. ♪ ♪ ♪

and welcome to "power lunch. i'm melissa lee. nasdaq barely holding on up about 2 wi8 points joining the dow and s&p 500 which are negative etf that tracks, hitting yet another intraday all-time high and ivb is rally within health care it is on pace for best week of the year esperion, novocure, biggest leaders right now. >> thank you we will find out right now which car company has the highest quality of anybody fi phil la boes with that news. phil >> the latest survey on initial auto quality, surveying about 80,000 new vehicle buyers. this is what they found. good news, reliability, quality, people surveyed after owning the vehicle for three months, never higher in all the years they've

been doing this survey 27 of 32 brands improved quality ratings. top one, kia, for second straight year, ranks as best followed by genesis, which is luxury brand by hundred day and porsche were the top three bad news, people not happy with the driver assist sec knotechno are seeing adaptive cruise control, lane departure warning systems. when i talk with the head of this survey, he said look, people may not understand what this technology is supposed to do in some cases like you are wrestling with the car bottom three brands when it comes to auto quality. at least initial quality, worst being fiat, number 31, jaguar and you have involvolvo and thor bottom three finally, shares of tesla i get this question, where did tesla rank tesla was not in this survey because they did not have enough responses to consider them statistically relevant

some of that has to do with being allowed to contact tesla owners in california and new york they do not have that authorization from dmvs and those two states and they are not included in the rankings guys, this issue of driver assist technology is a big deal. because increasingly you hear people say, i'm not really comfortable with this lane departure system or collision avoidance system i'm not sure when it is supposed to work or not work, it is all part of the industry trying to figure out what people want. >> what we've learn said that every time apple makes a tweak to its iphone, everybody freaks out. because people hate -- i hate new things they can't figure it out how much of this is actual problems versus when bmw came up with the idrive system they had problems, but the problem is that they just didn't know what they were doing. >> people aren't comfortable with the systems and it is not that the driver asicht tesist

technology isn't working, it is more a case of they are not intuitive enough and people are not clearly explained or the dealerships are not explained. this is what it will do when it says you are getting too close to another vehicle in another lane that's the primary issue here. nonetheless, when you pay 30, $40,000 for a vehicle, you better be comfortable with it. if not, you're going to complain that's what they survey shows. >> 30,000, what is that a 4-year-old car >> i'm not in the brian sullivan world. let's change it. average price is there are 60,000 or $70,000. >> first of all, i only buy used cars i learned from phil that the average price of car is well above that >> $33,000 something around that. $33,700 is average transaction price. >> thank you >> that's average transaction price. >> bye, phil >> another news alert, this time on uber. >> hey, guys, of all pemt we

could run into here in detroit, we ran into former attorney general eric holder who of course led that investigation into uber's corporate culture. i asked him what was next for the company and he said that he's positive on uber and he thinks that company has a chance now to enact some real change. he mentioned that seven-hour board meeting that happened about a week and half ago and said that all board members were incredibly serious and he is very optimistic that all of his recommendations in that 14-page report are going to be put into place. guys, back over foup. >> all right random run there, thank you very much ceo, travis kalanick, out. no ceo, no co, no cfo, no general counsel. that sounds sustainable. let's get to president and ceo of aspen institute i will start with you, walter,

do you think that despite the failings, driving failures, that p propelled the company to a record in record time. >> both things are right set driving passionate force without him, i don't think uber could have gotten to where it is they have what is called travis's law, every adviser would say, travis, don't be so arrogant when you go in and testify before the city council, try to give a little, be careful. he would go in and take no prisoners with his approach and it worked. but i think this is a good thing now. at a certain point a company has to mature and i think this is a good time for uber to move to the next phase >> a lot of people, when they finished that book, said, wow, steve jobs is a jerk they liked the product but were

uncomfortable. he isn't a likeable guy. does the world have a tough time that founders are often jerks. and the fact that what makes them a jerk is what makes them good at founding a company >> well, yeah. steve jobs, first word that comes to your mind is not jerk first word that comes to your mind is genius a guy that's passionate. he pushed people but everybody in my book quoted talking about steve being passionate or pushing them said yeah he drove me crazy but he also drove me to do things i didn't know i could do and i'm so glad i worked for him. i think travis has some of that in him too he drove people crazybut drove this company into something that transformed this world you don't totally transform urban transportation systems globally within a four, five-year period without pushing very hard. so yeah, i think have you to be pushy. i think you have to sometimes be arrogant to be a great founder but you know, great founders are

then often followed by people who are great consolidators or people who know how to run a company in a more calm and sane way. >> not everybody has to be a jerk, right? we have a number of founders out there who are current ceos of their companies. and jeff bezos comes to mind he is still in place and doesn't necessarily have the well known reputation of being a jerk in order to get amazon to be as innovative as it is. >> mike mark zuckerberg, the best example a company even more valuable what he did, and he was a kid when he started building it. literally a college ropout, learned fast mark zuckerberg took criticism to help himself. he gave control to a number of adults to fix things when he realized there was a problem with women left out, he brought in maxine waters to come in and empowered her to do whatever she today do.

zuckerberg is the example to use here he is best of the best in this sense. >> you don't think because the world has become so pc >> you know, many factors here but the fact is you need to have leaders who can learn and grow and keep arrogance under control. >> mark zuckerberg, what was facebook originally? >> facebook was a network, and he wanted -- >> i think hot or not, right is this person hot or not? right? >> exactly >> he has matured along wait >> zuckerberg was a jerk on the road show, focussing on the wrong things, but grew up rapidly. i was critical about mark. what shocked me is about a year are a two ago he wrote me an e-mail thank you. i read your stuff. i appreciate your input. this blew my mind. and i'm hit biggest critic and he is thanking me.

that's the sign of an adult. he is learning and growing >> like i said, flattery will get you everywhere >> walter, another point about uber, not taking anything way from what a team has done. as you said, transformed urban and maybe suburb an transportation, right? everyone is ubering around because they want a glass of wine they don't get into their own car and get a taxi however, this is still a company that loses by most measures billions of dollars. did he build a viable organization >> yeah. i think when you build a company sometimes that's totally transformed and disruptive you are going to lose money and jeff bezos, a wonderful ceo, did that with amazon as well i have a piece that's book review cover on the sunday new york times this coming sunday about airbnb and uber and why they were so disruptive. i think that market's not crazy in the venture capitalists aren't crazy, the valuation of

this company is very big it's got enormous potential. >> so to settle it down for wubs if uber were a publicly traded company, would the stock be up on this news >> the stock would have crashed over the last few weeks, last few months today would shoot up again th they have a chance to bring in a top notch executive and they have free reign to bring in someone to transform the company. hopefully bring in a woman this is wonderful for silicon valley now their role model has been demolished and we goat rebuild silicon valley that's the way i'm seeing it >> characteristic size, walter, do you think that we need to see in a new uber ceo? >> i think one of the greatest jobs available in america now. one of the things about travis stepping down, which was good on his part, is you talk to the very beginning about all these jobs unfulfilled including the

cfo. and now there's a chance with travis stepping down that people come in, great woman or great guy, come in and say, i think almost any potentially huge ceo would want this job. qualities are something that's got to be a consolidator someone that can follow a very aggressive co-founder as travis was. >> just a quick point here, why do you think things will get better in silicon valley i don't want to lump all companies in together, but we were going to do something last year on it and just didn't have time all these hot start-ups with different problems, you know, th herenos run by elizabeth holmes. but mostly silicon valley is male, white. nothing has changed. why would things get better? >> well what happened is -- >> the demographicsn aren't

changing in silicon valley >> it was humiliating for the valley have you investors saying this isn't like us, this isn't like us but this showed that the investors are problem, boards are the problem. it exposed the worst of sill von valley the fact investors today do what they should have done two years ago and fire him shows that finally they were held accountable and -- >> but the worst and best have to do together sometimes when have you a wild west culture you will build huge companies and also have a city full of con men, right you can't have this -- >> when you talk about frontiers, and this is was on the frontier, silicon valley is often on the frontier, this happened for the past thousand years. whether the wild west of america or frontiers around the world. what you have is people on frontieres who combine idealism and sort of craziness. you know a whackiness to them

and that's what pioneers do. what you have to do for a sustained culture is who comes after the frontier >> thanks, guys. >> okay. >> and a check on oil right now. in just past 45 minutes or so it has fallen about a buck a barrel you see at the lows of the session down by about 3% no surprise the oil equities, s & p, worst performing down by 1.75%. there are reports that three opec delegates are dismissing the idea of deeper production cuts, referenced earlier by iran that could be the reason behind this steep decline which we are watching for you still ahead, alibaba executive, why president trump's made in america policy could be the gateway to china alibaba stock up more than 60% this year. should you ride this rally major storm headed towards the gulf

live on the ground in alabama. and senate republicans getting ready to unveil their draft health care bill tomorrow. will both sides get on board that and more mi uon ow lch."congp it's not just a car, it's your daily retreat. the es and es hybrid. lease the 2017 es 350 for $329 a month for 36 months. experience amazing at your lexus dealer. won't replace the full value of your totaled new car. the guy says you picked the wrong insurance plan. no, i picked the wrong insurance company. with liberty mutual new car replacement™, you won't have to worry about replacing your car because you'll get the full value back including depreciation. switch and you could save $782 on home and auto insurance. call for a free quote today. liberty stands with you™. liberty mutual insurance. welcome to holiday inn! ♪ ♪

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event. and they are here to learn how to sell their products to china's growing middle class who better to learn from than alibaba. china needs more american products >> next, china market, need a lot of america products and made in america the product, the quality, the service, you guys here visited the booth. beautiful products we, chinese consumers, are crazy about that we need that >> guys, you might remember that jack ma told now president trump he wanted to help create a million jobs under america this is part of him making good on that pledge take a look at some of these businesses this is vieta bit. they say they've today hire more than 20 people here in the united states since selling on alibaba. this is the family owned gin sing company they say they've hired eight people in the united states

since selling goods on alibaba's platform this is a long way from the million number, but it's a start. one major challenge, alibaba has to show these businesses and others not in detroit to trust alibaba, a crack down on counterfeit, which is a big problem, and trust them on their products >> thank you alibaba is not only attracting u.s. businesses, it is also attracting a lot of investors. stock up whopping 61% this year alone. up 80 perce% last 12 months outperforming, apple, google, netflix. rob, good to have you with us. if you're forced to choose between a new stake or alibaba, which would you choose at this point? >> i think in terms of being furtherest from where it's appropriate valuation is, alibaba is the top of the list

if i was ranking order, i think the next in line for me is netflix with the most cap appreciation over the next three years. i think of the mega caps, $100 billion and up, alibaba is probably still set for outsized gains the next 12 months >> company had a stunning analyst event a while ago. a few weeks back ago in china. gave some guidance that knocked the socks off of what analysts we are expecting out there in terms of the target, a trillion in gm or gross merchandise volume by fiscal year 20, how important is this retail push, reachout to small businesses here in the u.s. to sell to china. how important of a part of that goal is that >> important they can't get there on china retail alone obviously china retail business is the significant majority today and it's growing still nicely in the 20 percent plus range. even if you compound that and you can't get to their target without a material contribution from international two segments, one we are talking about with the detroit event is

their express business, to facilitate cross-border trade. and growing quickly in acquired properties in the rest of southeast asia they need both to make that $1 trillion target. >> what are roadblocks alibaba could face in expanding international sales? >> yeah. i think cross border is difficult. there's a lot of friction in that delivery chain and logistics model. importing goods across tariffs, immigration, currency exchange et vaet. there's certainly work to be done i think that that's an opportunity to make that a little bit more frictionless in this southeast asian properties, i think it's just execute the play book that worked in china. export your proposition and competencies into those regions. very similar type of consumers in singapore, thailand et cetera >> rob, thanks for joining us. >> coming up, baton down the hatches on the gulf of mexico. look that.

tropical storm cindy growing s adg was e intordth gulf we are heading to mobile, alabama. [vo] when it comes to investing,

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the afternoon, evening and into tomorrow as it continues to make its way north, there is a prospect of corps nadic activity we haver to nadic reports in new orleans proper a short time ago. unfortunately we will see more of this in overnight hours and next several days. there is also a loss of life reports after 10-year-old boy who lost his life here in the mobile area caused by debris, we believe, picked up by the wind in terms of rain fall, some places like florida with eight inches of rain here about four. with the idea there could another four to six inches of rain for the area, flooding could be a reality for many people to be dealing with as we make our way through this will eventually make its way on shore we do believe it is overnight and into tomorrow. then lift up through the southeast. louisiana, mississippi, alabama,

georgia, maybe tennessee and carolinas. again, in early chapters after weather story that will evolve over the next several days back to you. >> what is amazing is the amount of rain we can hear hitting the ground and your microphone and it is only early stages. thanks for joining us. stay safe. it takes two to hug. a lesson senator marco rubio learned the hard way twitter going azcry. the botched ivanka hug, next okay, well let's see you get up from the couch. i'm sorry, what? grandpa come. at cognizant, we're uniting doctors, insurers and patients on a collaborative care platform, making it easier to do what's best for everyone's health, every step of the way. you may need more physical therapy. ugh... am i covered for that? yep. look. grandpa catch! grandpa duck! woah! ha! there you go grandpa. keep doing that. get ready, because we're helping leading companies lead with digital.

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welcome back this is how your money looks right now. mixed picture. nasdaq leading gains up about one-half of 1%. red hat trading at its highest level since 2000 winnebego also, beating pretty much everybody but melissa and michelle own an rv at this point. food locker, worst on news nike may sell product through a little start-up store you might have heard about, amazon.com has a bright future and watching maybe the biggest market story out there which is oil

crude oil falling again. jackie deangelis, you sent out a note saying, can we just summarize your note? >> go ahead. >> too much darn oil >> there is too much oil these are reasons, traders are getting very nervous here. reports that libyan production is going to continue to go higher libyans are ramping up also that nigeria is ramping its exports these are the two countries we've been watching for some time that inventory report, less bullish than it seems. a slight draw down in crude and gasoline but not as steep as we would expect to see at this time of year. finally, some headlines coming out of reuters that opec delegates are dismissing the idea of deeper production cuts so actually down to a session low of 42.13 ten-month low. can you see here we bounced from there. but still 2.6% drop. back to you. >> jackie, i have a feeling we haven't seen the last of you for a while. now a cnbc update with contessa

brewer >> house majority whip steve scalise has been upgraded to fair condition a week after being shot in northern virginia during congressional baseball practice the hospital says he continues to make good progress. fast-moving encino fire destroyed at least four homes, threatened 122 more in southern arizona. evacuation orders are in place right now. this scorched 1300 acres stins started by lightning last night. so far no injuries reported. a republican won the most expensive battle for congressional seat in u.s. history. karen handel winning special election for georgia's sixth district a traditional republican strong hold >> a special thanks to the president of the united states of america >> let's not forget our equally great vice president, mike pence. >> that's the cnbc news update at this hour back to you, michelle. >> thank you, contessa. after weeks of secrecy,

republicans plan to unveil a draft of the health care bill tomorrow kayla is live on capitol hill with the latest. >> there was a meeting taking place here on capitol hill we caught up with senators milling about after that meeting. among them senator of wyoming said that the bill is expected out tomorrow morning at the:30 a.m. and then senator cornyn, majority whip, saying he expects the cd it o score could come out as soon as friday. there were acouple senators saying that there will be more than enough time to introduce amendments and actually change this bill during the budget process. once it is announced but there were others like senator bob corker who said despite the fact that he is a senate republican, has been in a lot of these meetings, he still doesn't have any sense as to what is in the bill and has to wait until tomorrow. he joins about a half dozen republican senators who have either said they don't know what's in it or believe it'll take quite a bit of work even after its disclosed on thursday

before senate republicans can reach consensus to get at least 50 votes on this bill. among them, senator ted cruz, bill kacassidy, and many others telling reporters just that. interestingly, senator mike lee, the small group tasked with brain storming and coming up with some of the tennants of this bill he took to facebook yesterday with calls to constituents asking him what's in it. he said this >> it's not written by us. apparently written bay small handful of staffers for members of the republican leadership in the senate >> so if you're frustrated bit lack of transparency, i share your frustration >> there is a steady drum beat of calls, and we very well not get any substance until tomorrow morning. >> we'll be watching for that. thank you, kayla. >> democrats coming up empty in two high profile house races in

georgia and south carolina they are now 0 for 4 in special elections. president trump called them out in his tweet this morning. saying quote democrats would do much better as a party if they got together with republicans on health care, tax cuts, security. obstruction doesn't work is there any chance that's going to happen? joining us now is senator maria cantwell, democrat from washington ma'am, good to have you here >> thank you >> what do you think any chance with the result of the elections we saw last night? that we will see more coming together from democrats and republicans? >> i'm always for making things happen for our economy and certainly think we should focus on jobs and things that will create more economic opportunity for americans. my colleague susan collins and i are having a meeting today with some from the executive branch on's presentis programs. how to innocent more hiring of apprentice and skills and train on the job

that's a great example to get off the start. >> do you agree with the president that being obstructionist something that works against your party >> well i think the president, you know, tweeted out he didn't want it cut medicaid so you hear a lot of discussion now about the health care deal and whether or not he is proposing doubts medicaid so you will have real policy differences and people will want to see in the light of day the concept of cutting that much medicaid money out of marketplace. what does that do to the health care system. i think that's a fair debate i'm sure there are a lot of issues where we can come together i know infrastructure something on the tip of everybody's tongue, so why don't we really put pen to paper and come up with something that will help make an investment for the american people. >> these are great specific issues thanks for highlighting them can we do a much higher up picture of you why do you think democrats have lost 4 out of 4?

is there something wrong with the messaging? especially when you look at polls, president trump appears to be incredibly unpopular >> i'm not sure what your 4 out of 4 are if you are talking about yesterday's two elections in montana. i'm not sure exactly what four you're talking about but what i think is important to do is to focus on the economy and to focus on jobs and while i know the president has talked a little bit about that, i think the democrats have an agenda too and this is what americans want they want to make sure that path forward in a transitioning economy will include them. and these are important things about what we're going to and where we're going to make investment and how we will grow better than what we did in the first quarter of this year >> let's talk about south carolina and georgia then, senator. it was a defeat for democrats at a time when the president has, you know, there are questions

about whether or not his party would ride on his coat tails and here we are. do you feel like your party is perhaps disadvantaged. do you feel less optimistic in terms of 2018 in turning seats over h >> i think when you think about yesterday, you see seats that were traditionally held by republicans and i'm sure that democrats wish they would have won those seats but the large her issue here for americans across the board is how our economy will continue to change and whether we are prwell prepae for that i want it make sure discussions in congress are about moving opportunities forward and will have more robust growth than what we saw in the first quarter. so the issue is who is going to come to the the table and help us innovate and make that kind of change. and i'm going to stand ready whether they are democrat or republican i do think democrats need to up the dialogue about our economic agenda

when i ran six years ago, five and half years ago, i focused on three things, jobs, jobs and jobs i've heard president trump say the same thing let's get to that task let's work on jobs and economy >> what do you think the health care bill coming to the floor finally? will that pass, you think? >> i don't know. i'm not an odds maker on that. but i will tell you this, to cap and cut medicaid will exacerbate our problems medicaid stablizes a lot of populations and allows us to deal with everything from the opioid crisis -- >> it is not cap and cut it is devolving to the states so they have more choice, which is what president clinton did with welfare reform >> nope. i wish that was the case there is a lot of innovation

for exam fm we were shifting to -- >> but this is not for the federal government to decide, this is for the states to decide how do you feel about that >> i come from one of the most innovative states so my frustration is that instead of allowing that innovation into the delivery system, what people are doing is just capping and cutting medicaid our state saved $2 billion by shifting off of nursing home care into community based care $ $2 billion from one state. we would innovate and save dollars. don't be just a budget mek nis it is going to exacerbate the cost of our delivery system and we don't want that >> senator, thank you for joining us senator maria cantwell of washington >> thank you >> speaking of washington, twitter having a field day with

another political gaff, this time involving senator rubio's attempt to what look looks like to hug first daughter ivanka trum it was of course caught on camera, ridiculed in 140 characters, senator after rubio joining in saying his team started an investigation into the incident he also joke bed it on squawk box. >> that's not fully investigated we looked that the deeply. a senator is capable of carrying out a traditional greeting i stand by our investigation i think it's been thorough >> at least he has a sense of humor about it funny. looked awkward ahead, are managers becoming more important than founders a new book saying it's the flat forms that managtter and the managers that run them >> hey, rick >> hey, melissa lee. if you look at ten-year yields,

you will see we move up, move down yield curves, so much talk these are ten-year charts. how much does flattening matter? it's a big issue considering the position of central banks. finally two-day a dollar index a pretty good run. hasn't covered a lot of ground but continues to move higher though it is drifting now. listen, uber ceo is out. how much do managers matter? is it all disrupting with regard to technology? you want to find out stay tuned to "power lunch." we'll return right after this.

welcome back uber founder travis kalanick stepping down as ceo, raising doubts about the company's future when it comes to startups as disruptive as uber has been, does the management matter or is

it really just about the technology joining us are co-director of mit on the digital community they are also authors of the new book "machine platform crowd" harnessing our digital future. uber is mentioned a lot in the book as the company of the future good to have you here, guys. >> great to be here. >> thank for having us >> can uber survive without cal nick >> yes the book illustrates if you get the technology right you can flub the management for a descent length of time now culture is extremely important and like we saw with uper it eslint rose up and caused ceo and other top managers but getti technology a managers right is powerful >> the book argues that uber

isn't a product, it a platform machine, platform, crowd why is platform matter so much is the thesis that once the platform is well established, whoufr found whoever founded it doesn't matter >> i wouldn't go that far. but it is part of three great rebalancings in the economy. products and platform and core in the crowd and in the case of plat forps, five of the five biggest companies are platform companies and lat of ones that came out of nowhere like uber are platform companies there are a lot of smaller ones. and what they have in common is that they are connecting people on different sides of the market and you create and eco system that becomes self reinforcing and self us staining same thing can happen in reverse. they could start unraveling but the successful ones have got the right combination of technology and economics as andy is saying to make a virtuous psychel that

builds on itself >> it is not a platform company to convert itself to a platform company and i'm thinking about retail and their need to sort of embrace a new way of doing business >> yeah. what we see over and over again, are so far startup companies coming into incumbent organizations and disrupting them it is interesting to see if the established companies in industry after industry can respond to the platform threat and create ecosystems of their own that copy of play book they've learned from startups. we haven't seen a lot of exam e examples of that yet >> i appreciate you coming on the program. i'll a big fan of your work and your book. >> thanks. >> we talked about you and eric's first book. a lot of our audience, you know, they may be sitting, listening to this interview and going, what the heck are they talking about? if you're a blue collar worker in wisconsin or office manager somewhere in texas, what is all

this you write about kboing to mean for them? are they going to have a job in ten years? are their kids now living in their basements going to have a job? >> yeah. it's a great question. we get asked all the time. there is bad news and good news. the bad news is, that we are are no longer going to have a large stale middle class doing routine industrial era kinds of tasks and jobs i don't think that means we won't have a prosperous middle class, they just have to do different kind of work and acquire different kinds of skills as we look around at where the growth is, there is big growth in interpersonal work, big growth in social work and motivate aep negotiate and persuade people. and lots of work out there doing things in the physical world because robots are still lousy that one thing derek and i want it see is a big infrastructure plan

p thap wou that would create lots of good old-fashioned hard-hat jobs. >> if those workers are still out there. we've seen the december nation of the american work force many say it won't be there a follow-up says if we don't have that middle class you talked about, what are they going to do? jack ma today said he sees a four-day work week,man maybe even three-day work week coming in 10 or 20 years. would you agree with that? just not enough work to fill our time >> i'm not that worried about not enough work to go around but i think jack's idea is a good one, more flexibility in our labor force. when you look at unemployment rate, you see people like you just said, working three, four days a week. having perfectly fine quality of life rigidities bake need policy answers sfrtructures that make that low, let's get rid of the

ridgi ridgitities. >> which country working right >> iceland >> spain, germany, still relative to us, high unemployment not the same there right? >> no, absolutely. and to talk about europe salon lijic thing is dead flat wrong there's a big mix of approaches there. some of which are working pretty well some are not >> okay. guys thanks so much. it's called "machine platform crowd. >> the four big wall street calls done by actual human analysts and recited by melissa and my sell, actual humans, is coming up p. >> i'm a machine doing mine. >> i hava owdoe crd ing mine >> big talk. sad version is next.

good looks, hollywood life and billion dollar brand, george clooney selling 'tis tequila company. the longtime friends formed the company a few years ago while drinking different tequilas one

night in mexico. i'm surprised they remember it the story has it that clooney turned to gerber and said why don't we make our own? the rest is history. crop nbc reached out to clooney's rep and made the following statement -- if you asked us four -- this reflects diageo's belief in the company, but we're not going anywhere we'll still be very much a part of casamigos starting with a shot tonight, maybe two. >> i'm glad we could bring some sunshine to those fellows' otherwise dreary existence >> they needed a pick-me-up. >> you're good-looking, rich, successful giant mansions next to each other. >> he's not as tall as you, brian. >> every time you start to feel good about yourself, i didn't

even want to come to work today. >> he's not as tall as you. >> that's all you got? you're producerers is said that randy gerber is taller than i am i challenge that gerber, come on set, we'll match up and talk business thank you. the stocks you need to know about, we talk about with intel, the $38 a share after the a nfl d launched a new set of data -- and nvidia has been gave a share of -- and accelerator which could hurt intel's push to raise average selling prices well, the second symptom is marcus lemonis' company, camping world. starting with an outperform and $36 target they say camping world should start earnings, the market for rvs is hot have i avi the win

beggo numbers and think that camping world could take market share. not the only bull, by the way, on cample world. goldman sachs upgraded back on june 9th, but 25% total return you're welcome, marcus. fedex getting cautious comments from credit suisse. saying a lower tax rate contributed meaningfully to the e.p.s. guidance, there's a lat of clarity around fiscal year 18, and fedex is spending more on cap ex than expected. also said shares are likely to take a short-term breather sglooz day today for fedex the small-cap stock of the day is a bone stimulation firm. >> a what? >> it's call the orthofix. it's a firm that stimulates bones from hard-to-heal

fractures. ortho fix. btig has a buy rating. cautious clients have been nervous, because they had an s.e.c. investigation, they had some restatements, but btig is confident. they say that's maybe noise and investors should focus more on earnings and growth for the company, so btig is bullish on orthofix, ofix they also like the cash flow story, with a $52 price on that. >> you learn something new every day, michelle. >> you sure do thank you. call it brick and slaughter. a look at who amazon is a threat to now second hour of "power lunch" starts in two minutes.

welcome back here's what is topping the 2:00 menu, a major shake-up at the top of saudi arabia, rattling the oil markets. what it means for crude and american policy in the middle east ahead, plus the rocky road for an ipo, what the ceo's departure means. and big scream, but a small odds en

end. le second hour of "power lunch" begins right now into a check on the markets, they are both lower, albeit fractionally -- it's -- up nearly 5% in just the past two days, today 'trading on very, very heavy volume. 350% being traded in that -- a look at the leaders. we have a big move for twitter as well technicians also -- which is of course people who shine. almost now formally in bear market territory. china is finally getting the

endorsement it's been waiting for, planning to add mainland chinese shares, just how important is it to china for the inclusion, hey, tim, good to see you. s can you hear me, tim can we hear him? >> good to see here. >> also going to be sort of contingent on whether china progresses on some of the improvements in its financial system are you confident this will happen to the full extent? >> i think it will but it's very appropriate. s evening though china has 28% of the broader index effectively

out of hong kong to them, the emerging markets, so there should theoretically be a flow into china, because they have to mirror the index they could see their weighting in the index go down does it necessarily mean it's time to stay away from the two markets? >> i don't think so. i think in the short run the impact of the passive index tracking is $2 trillion tracing this passively about $14 million will move around, but the implications of a 0.7 china shares inclusion is really a rounding error for taiwan and south korea china will be 40 and asia will probablily almost 80% of that index. when you include india, south korea, taiwan, china, it's 63%

of an index that's supposed to be the world that tell us how it's -- >> based on its size, everything you have said, i totally get while someone might want to mishor however, the reason there was so that hesitancy for so long is you never know when the chinese -- on no trading aloud, we're putting stops in, we're doing this rule today, a different rule tomorrow. >> how do wrap your head around that >> i expect this had pessimism out of you, michelle i think you're probably right to push back. the bond connect, which was announced four weeks ago i think is also an important part of getting foreign investors in a bond mark we are also worried

about. investors ultimately need to do their work on the individual stocks you need to look to see what are the major components of that index. i think that gets down to understanding corporate governance i am convinced this is important -- and sdr rights, we've seen it with other places where they want to be seen >> got it, tim thank you. oil squarely in bare matter territory. is northerly a place to start probing? >> brian belski, also with us a new face to cnbc, darren nero, brian, first to you, and welcome, darren. brian, i feel like it's 2014-2015 with oil, you've bullish and right on the stock

market however we were concerned about equities and oil a couple years ago because of the debt. it's a debt story as much as an oil story. are you going to revamped your forecast given that oil has tanked >> no, i mean, from a longer-term perspective it handle tanked. this could be actually quite positive for the energy sector oil companies are destroyers of capital. they chase the oil price back and forth. our theme for energy remains steadfast, embrace the range we think that range is 40 to 60. it would get office companies an opportunity to manage their businesses we actually think there's better times ahead for energy companies, and we would become more aggressive around $40 but bottom like, this could be quite positive for the sectors in this.

>> when you have had positive, brian, i'm having trouble putting that together. how is collapsing energy -- energy stock oil dead is now selling again. how is that in any way good? >> brian, brian, you're talking about a commodity. >> you're in canada. it's going to collapse your entire economy >> oh, well, here, okay, so let's talk about that. last year canada was the best-performing developed market this year it's the worst performing developed market and oil price versus stabilized. they haven't collapse. collapse is until 30 or single digits those are big words that are emotionally led. energy and commodities led the last cycle the next cycle will be about fundamentals, stock picking, value, north american companies, it it's going to be north american growth and stocks that's great and everything.

the true strength will come from financials, technology, industrials and health care, not energy. >> darren, you say that energy is becoming interesting because they have outperformed the commodity, so the commodities in bear market territories and energy stocks as a sector is 18% or so off a 52-week high, so barely out of bear market territory. why doi think there's an opportunity here >> i think you need to be selective for sure, but as a value guy probing into the energy stocks right now i think is probably the only area where you're seeing absolute valuation support. where we're focused really is on some of the higher quality enp names, and we're seeing valuations on these stocks that we haven't seen since oil was back at 26 from a balance sheet perspective, they're far stronger than they were when we saw this action back in the beginning of 2016.

we feel like they may be visages that we're close to the bottom >> do you believe there's some sort of on floor in the price of oil? right now we're back at levels pre-opec cut back in november. we're in summer driving season seasonally this should be a strong season for oil. we've got the dollar, which is down here today. that should be strength for oil, yet here we are, we're at these lows the markets gets so concerned, particularly the incredible at production. >> i think the other key element has been relatively pronounced

what do you think about them right now? are they a value trap? >> i don't think they're a value trabl. we thick book valuing are very strong, earnings have become more consist president that's just the bond market being a bully. i think with the pain trade as higher overall in the market, but i believe across the world, as we talked the institutional investors, they are not prepared for a growth surprise, they are

still very negative. i think they're going to be behind the eight ball. guys, thank you. saudi arabia has a new crown prince, and a surprise shake upking salman is ousting his nephew and replacing him with his 31-year-old son to be next in line for the throne the new crown prince already on the front lines of economic change he's in charge of changing the saudi economy so it's less reliant on oil he's been out front making the case for the ip oval of the saudi oil company. the move that is implications for both the oil company and oil prices. matt reed as written extensively about this, and jackie deangelis covers both as well jackie, what do you make of this move today i think you need to look at this

as a management a shake-up what you have going on here is a situation where they want to get their ducks in a row before they get this ipo out they are concerned oil prices are under 50 right now, you have tensions with qatar, with iran in the region, and they're wanting to instill this confidence in the international community and the markets to bring money in that ipo has to be a success >> what does this mean for the ipo? >> i hate to say it, because we're on a live broadcast right now and breaking news is by the minute, but i think the implication for the ipo really are negligible this is kind of a nonstory for the last two years, the saudi economy has the pet project of muhammad bin salman, who just got his promotion to crown prince there is no plan b

you could say the reform project which the ipo was a huge part of is inch isally plan a, b and c the only question was how soon could they get everything out of the way, every detail, every box checked off before they could -- >> i'm going to push back a bit, not on the news part i might great with you on that however, it does seem -- and we talked about it extensively. jackie lived in the region for year, that mbs is consolidating power. they also changed the head of the energy ministry as well. al naimi is out. you have this change, this is a family that is in many ways, i don't want to say consolidating power, but at least bringing it closer to looking inward. >> it's definitely, you know kind of being pushed out to the younger generation, pushed down, you might say.

you have lots of saudis light now who are young, 70% of saudi citizens are younger than the new crown prince, who is only 31 years old. think about that for a minute. when it comes down to it, the ipo, like i said before, the promotion is a bit of a nonstory the ipo was on autopilot, about you if you're talking about politics, the pace of reform, then the promotion to mbs is a big deal i think for the ipo it's kind of a nonstory. >> what do you think it means for oil prices >> i don't think there's a direct short-term impact, but the point that brian brings up is great mbs and the new energy minister, they are working on an oil strategy together, they want to see the pride at 50 or higher. i'm not necessarily sure we get there in the short term, but that's their vision, this is playing for the rest of the year and for 2018

preparation for that ipo i do have to respectfully disagree with the guest that this ipo is on autopilot and they're not wired about it at all. i think they are. >> it's not that they're not worried. regardless of mbs's title, the ipo was going to advance that was the plan, 2018 they were going public. >> we've got to wrap it, matt. thank you very much. you know, too the main sticking point, as my sources is what percentage of tax revenue will the federal government take for aramco >> always a key question when you're talking about a state-owned oil company for having to change so dramatically. >> thanks, guys. here's what's coming up on the rest of the hour on "power lunch. it's amazon's world and the rest of the retile is a living in it. and jd powers' widely watched

report on car quality. more fancy stuff in the car means a lot more things could go wrong. and a slow start to the movie season if fewer people want to go to the movies, how do the entertainment companies make up the difference l hat and much more coming up on "power lunch." right away, it was a success. i mean, it really took off. what people don't know is that it all started with points from my chase ink card. i bought the ingredients, utensils, even custom donut cutters. wow! all with 80,000 points. what will you create with your points? learn more about the ink business preferred card.

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laughing at something brian said during the break it would cut 15% of the workforce. definitely not funny and could nike be amazon's next partner? goldman sachs analysts say nike could start selling directly on amazon that's hurting the big sporting good chains today. footlocker and dick's down more than 5%. that's not only the only headline out there today, prime ward roar will alloy members to order up to -- without purchase. ship back what they don't want and pay only for the items they keep that's a little comfort to a retail market already struggling in fact we have seen the reaction in the eff. cnbc contributor and cnbc retail reporters courtney reagan. jan, first your take on this shipping, they're going to pay for shipping without a promise

of purchase? and then get the merchandise back how does it work will it be profitable for them >> nobody said they're going to make money, but they're going to do a lot of business do i think it's a good idea for amazon yes. do i think it's terrible for everybody else i do, but i don't think they're going to make money. they'll have shipping costs both ways, a lot of returns, you keep it for seven days, any other retailer did this, you would be, whoa, that's going to be expensive, but with amazon, they don't need to make money, they need to build volume they clearly will do that. >> in the context, courtney, of this report that nike will sell directly to amazon, that seems to make more sense if amazon is going to buy merchandise, why not do that if you're the manufacturer of aparity and until this industry, why not sell to amazon which would manage to take on that loot >> yeah, there's certainly some

companies that vnl been happy with this they didn't like the partnership they had with amazon for a variety of reasons, but i'm starting to think if you're a vendor or supplier, manufacturer of goods, if you can't beat them, join them if that's where the customers are going, then isn't that where you want to be >> did you see where whole foods is trading above what amazon has offered. what do you think will happen? >> i think they'll wind up in the deal together, whether it will be another bid and competition, i don't know. rumors have been out there that walmart wants to buy them. it seems more likely that amazon will close the deal, and i think this is a really big deal if you happen to be in grocery. the giants will fight it out in grossly, both in online and brick-and-mortar it seems like anybody else in the game unless you're a niche special player, you're in trouble. >> i'll push back, a question

and comment, are we overstating? sometimes the media -- me in particular which is that a lot of retail stocks are nicely this year, best buy, tiffany, ultimata, lowe's, the market doesn't think they're going to die the second part is did you see that people in "wall street journal" about t.j. maxx it was the best i've read in a long time about human beings are the reason that t.j. maxx is successful. >> i understand what you're saying you didn't name all the retailers that are down. >> that would be too long. >> the list would be way too long you didn't list all the ones going broke this year, which is a new report for those who go brother in the first quarter. >> okay, okay, but as courtney reagan has told us many times, the bankruptcies are primarily the results of highly indebted companies generally with private equity sponsors who levered them

up says. >> are. >> well, i agree with that, but it -- we're seeing retailers close a lot of stores. most of the reason is the movement online, not necessarily just that they're levered. the levered ones are going broke first, but the movement online is what's causing all the trouble. amazon is really the online business, so i still say between am op and walt mart, grossly is in trouble between amazon and whatever they're going to do with their curated selection that you get shipped to your house, you can ship back, try on in your house, whatever they do with that is going to cost a lot of apparel, and it's going to affect people as far down as t.j. axx. it's going to start with companies like macy's nordstrom's, but it will affect people all the way down to t.j. maxx, this is an inroad into thes business with all the brand names, and the brands will be

selling on amazon or some of the brands will get bought by amazon. >> i was just going to ask courtney about that. buy them out of bankruptcy. >> and it is possible this ecdo that there were rumors amazon was interested in american apparel whole foods is the first big physical acquisition that we know of, so it's certainly possibly taking a page, but i think amazon is pretty confident in their, the lark & roe search comes up pretty high, so they're definitely putting it out there. >> i wonder if that's the issue. >> the democratic oj hates. >> that's what they call tying monopolies are not illegal, and i'm not saying amazon is a monopoly, but to block other people, that's what the doj does not like i wonder if that stuff might get the attention of somebody someday or not. >> possibly. >> make sam op will buy the doj.

>> maybe not out of the realm of possibility. >> thanks. argentina, energy and a comfy recliner the good the bad and ugly is coming up next what does the departure of uber's founder mean for uber uber-edition of "power lunch" continues. that's a great idea, but why don't you just go to thinkorswim's chat rooms where you can share strategies, ideas, even actual trades with market professionals and thousands of other traders? i know. your brain told my brain before you told my face. mmm, blueberry? tap into the knowledge of other traders on thinkorswim. only at td ameritrade.

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welcome back to "power lunch. time for "the good, the bad and the ugly." la-z-boy up about 20%, also beating on revenue on to the bad, that had bell tell com argentina, stocks getting killed today that is down 9 1/2%, michelle. >> is getting rid of trevor kalanick the best thing for uber plus oil down another 2% today polywill be right back

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here's your cnbc brewer, lt.

jeff envelope is out of surgery, his condition is stable. he was stabbed in the neck earlier at the airport the suspect allegedly shouted al la akbar the homeland underskerritt was asked to testify. >> as of right now we have evidence of 21 states of election-related systems in 21 states that were targeted. >> there any coordinated response on how we'll prevent this further >> yes, sir. pope francis got a gift, a helmet and a jersey. engineer legitimate jones, the owner, franco harry, ronnie lott and curtis martin are among those who got a private audience with the pontiff if the pope throw as football, is it always a hail mary

you're supposed to laugh, brian. >> i'm thinking about whether or not i think that it's funny. >> it's not funny -- oh, i'm outta here >> wee lick it i dig it nice job, contessa. >> i thought it was funny. >> i thought it was fantastic. >> you're hard to please not impossible, not just hard. it's like saying a diamond is a little firm. anyway, here's how your money and investments look the nasdaq is your big winner. probably talk more about this on "fast money" with the stunning melissa lee tonight. oil down 2% right now. nearly felt beround $2 a barrel. get this, guys, the average stock of an oil company in the

balkan renul bakken region in north dakota, down 38% this years. ouch one of the world's leading energy and banking research company. he took time out of their conference to come on the show dan, we appreciate it. you have ceos and -- i'm sure they're a little shell-shocked right now, what is the consensus on why oil continues to fall despite that opec cut. >> i think oil needs a hail mary >> nice. >> i think even though opec is doing their part, what you're seeing is a combination of libya coming back to the market, plus the u.s. shale producers who have decent economics at this 45, 50 a barrel ranges growing their production, so i think it's basically not an opec issue, but a u.s. producer and the market decided we have too

much. >> you're in houston, you have to be careful. ton blame america for the oil slide. i would imagine that's a dangerous thing to do. we are inching closer to 10 million bares of u.s. oil production a day, something that's handle only twice do you think that this slide is going to stop those rig counts from going up? >> i think we probably do get to 10 million, whether it's early 2018 or 2019, i think that u.s. production is clearly economic enough we've got growth opportunities in a lot of basins here in the u.s., so i think we're going to get there. i think the question is where are stocks when u.s. production gets to that level equity investors donnell like this increase in production. >> yeah, you know, and then you look at u.s. production, you look at drilling rigs, you guys also put out a lot of excellent

stock research which we have used on this program is there any part of the oil and gas market that you analysts think is just deeply undervalued and week a great asset to perform right now for our audience >> we think that basically the whole sector is a fantastic value right now. the question is when are you going to get paid? when you look it he absolute and relevant performance, the average stock is down a bunch this year, worse on a relative basis. >> announcer: is went under 6%, typically nine, so i think the key is having the courage to step in and catch a falling knife. >> looking down here, i have these screens, the average of what i call the big eight, exxon, chevron, his, marathon,

bp and totale is down 16% this year would you guys be buyers now >> we would be again, those companies are doing the best in the sector, if you looked at some of the smaller producers, which you think are great investments, you know, the majors are safe, they pay a dividend we feel that they're meaningfully undervalued compared to where we think on the will be. where it would be in the next two, three months, is anybody's call it feels heavy, but the sector is a good value. >> thank you for taking time out for us we appreciate it >> thank you. what will happen to uber now that its founder drafts kalanick is stepping aside? earlier we caught up with muir, another visionary founder who was forced to step away.

>> i think it's a brilliant service, he's brilliant. he just has to take some time and rethink. >> so what happens is it going to struggle or survive? joining us is jarrell purnell, and also an investor in lyft good to have you here. >> thanks for having me. >> when you heard this news, did you think gosh, i hope he doesn't a non-compete, or woo-hoo, we're finally going to beat him or can we hire him >> our feeling on the business is he's been a disruptor he's a visionnary, but obviously he's done big things, but clearly as a disruptor at times you have to break rules in order to grow your business. he did that wildly successfully. i think ultimately what we're seeing here is a company that's changed a highly regulated industry, and long term, i think their biggest issue that they're

going to have is at a $70 billion valuation, they're price to do perfection and hardly a perfect company. >> let me ask you this it this way. you read the descriptions, the letter that they wrote, the hours of discussion, if you were an investor in uber, would you have done the same thing and ousted kalanick? >> absolutely. i think at this point in time you need a c-suite who knows how to run a company of this size. it's one thing to have a ceo with a great vision, which he did. i don't think anybody can chastise him for that, but ought this point and at this juncture in the life of uber and the likely ipo that should come at some time in the near future, i think you need a c-suite with gravitas that understands how to run a public company. >> avi, you have invest indeed lyft what does it do to the value ways of lyft aren't you effectively cheering

it on, isn't that part offed pun, lift -- >> high tides lift all boats i don't disagree with in a, though some of the issues they've had overseas and taken the eye off the ball in -- >> lyft been able to capitalize? has it gained market share, for instance >> yes i think that the interesting part about lyft is, depending on the city you're in, both drivers and customers alike seem to prefer lyft, and culturally, as we saw, i forgot maybe it was around christmastime, where lyft ended up winning a culture battle against travis, putting an additional fee around some of the issues they were having at the airports. >> uber not profitable, they're losing less money than they used to in theory, but when i look at these companies, for example

what amazon is doing, even hollywood and all the money that's getting poured into the content creation that's going on, which is wonderful, you guys, your money is subsidizing cheap stuff. how long are you guys going to do that for. you know what i mean i feel like under uber goes public, there's no exit strategy until lyft has something happened, you don't get paid are you worried you're subsidizing all this consumption and it doesn't pay off >> brow the up amazon. they haven't been profitable until recently, so you think it's proof positive that a business can sustain themselves in the public and private markets not being profitable. >> interesting how? >> well, i mean, somebody is paying >> he's paying. >> you're paying >> the think the entire point of business was to make money i guess i need to find a new job. >> obviously, look, we all know

the future of ridesharing or the uber and lyft space will be the autonomous vehicle obviously i think that will help the margins pretty significantly in the future. >> thank you for the cheap rides, jaret. >> no problem. for you -- i appreciate it >> for, anything. >> thank you. the fancier our cars get, the more stuff apparently that can go wrong and sometimes does. so what cars rate the best when it comes to quality? and what are the biggest complaints that all of you out there have the guy that oversaw the study that we talked about at the beginning of the show will be o re to further break it down on whis good, who is not. a lot to do. stick around

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as you heard in the first hour of "power lunch", j.d. power announcing rankings for vehicle quality, looking at the number of problems the first 90 days of ownership as well, and according to the report, new vehicle reliability is thankfully at its highest level ever, but there are some issues. joining us from detroit is dave sargent, vice president of global automotive at j.d. power.

kia had the best overall quality for the second year in a row, fiat came in at the bottom, but let's talk about new car issues. here's the issue, dave are all the new technologies giving us problems, or is it that people just can't figure them out because they're new, to be fair, so they perceive them as problems? >> it's a bit of both. in some cases the new technology is not works as designed, but more often it's new to consumers, they're not familiar with the sophisticated entertainment systems and interfaces are new for them. so in some cases it's a question of educating consumers, but frankly some of them are actually fairly complicated and not something you necessarily want to be using driving it 70 miles down the fryway, so both in terms of making the systems more intuitive and also educating the consumers. >> are we getting in any kind

of -- i don't want to say peak technology, but with all the bells and whistles, my car is constantly nagging me. are we getting to the point where people are sick of it? >> there's a little bit of that. we are seeing with our safety systems like lane departure warns or collision, avoidance systems, some consumers are complains that they're a bit to nanny-ing and trying to stop them from driving the way they want to, but for the most part consumers do want the systems on the vehicles, it helps them feel safer, but a few are complaining that they're a little overly aggressive in terms of trying to control what the driver is doing. >> there was a too imwhen they rankings mattered, when the manufacturing process was newer, there were cars that were very unreliable and were a real pain. it's gotten to the point, as you point out, reliability is higher than ever. are there any cars left that you would say, you know what

they still have to get this up to snuff, i wouldn't buy this car? >> for the most part cars are reliability these days people aren't breaking down on the side of the road in a brand-new vehicle like maybe 20 years ago. others aspects are where consumers are having most of their complaints the consumer perception of quality is changing, so at j.d. power we changed our study to reflect what consumers are most interested in, and it's the way the vehicle operates more than whether the vehicle operates is really what makes a distinction between the better performitious and lesser performiaries these days, but this is who drives customer satisfaction, a loyalty to the different brands, and drives what they recommend to their friends. so this quality study is still by far and away the most important that we do >> okay. thank you. coming up, the vice chairman

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summer movie season is in

full swing the most important season for studios. titles like "wonder woman" getting a lot of buzz. are they enough to boost box office numbers box office numbers are up for the year this year's memorial weekend box office was the lowest since 1999, how do studios keep up with the same trends and competition from streaming giants like netflix and amazon let's bring in michael burns, vice chairman of lions gate. and the upcoming body guard. michael, welcome to the show good to see you in person. for all the platforms. >> we are, we describe ourselves as benevolent arms dealers we have 90 shows and 40 plus different platforms. we'll sell to anybody. or license to anyone and so, that's a big business for us >> what's your perception of what, where the industry growth is right now in terms what have platform since you do sell to all of them?

>> i guess the easy thing for me to look at is flat then when you look at electronic sell through viewing overall in the home. >> dvd >> dvd flat, which everybody said was going to go away. now you take a look at the sell through video and demand streaming, all substantially, what's happening is people are consuming more in the homes than ever before. >> when i look at the budgets, 2017 content budgets, is silicon

valley the dumb money right now? >> i don't think so. for the most part they're platforms. i wouldn't call them -- i was looking at the kbienled market tap of facebook, amazon, and apple. $1.8 trillion, so, these guys are not dumb i was talking about amazon, we're a supplier of amazon, we have a movie coming out this weekend, the big six and so what happens is, again, we're suppliers to them, i wouldn't consider them dumb money at all >> they're subsidizing the consumption, just the way the cheaper rides, we're getting better and cheaper content because of all of that extra money. so whether it's netflix or

amazon, enormous customer loyalty, and a great value proposition. >> when you look at platforms like an amazon, hulu which you got licensing agreements with, and potentially an apple, is this sort of like a frenemy situation? in which they are both competitor as well as customer for you? >> i think that apple, you know, picked up twol rising stars from sony to run their content area so i think that there's definitely going to be the shows, they'll buy a lot of shows or license a lot of shows from people like us. it's not like they're going to turn around tomorrow and make all their own shows. we have a good expertise in doing that >> if i'm watching the royals on e on sunday nights, i'm not watching something on cbs or -- >> power on starz. >> whatever it is. what is all this transformation doing to network television? >> which you are in as well. >> we are in we sell. we have obviously a show that we started with, abc, nashville which is now on -- >> cmt.

>> and so, we think that's a -- >> maybe not the best example. >> i'll tell you the idea that you can have different vines to swing to whether it's the streaming players or whether it's the networks or the premium cable, that's a good spot for us so we look at again, we look at the diversification play that we had. if you go back two years ago, 75% of the profitability came from the movie business. now it's 25% and 75 from different places like starz for example. so again, we build a diversified media company, that's what we're focussed on. the idea that we have many more boyars that we ever had for our shows, look what we talked about. we thought we'd be able to monetize those shows in various windows, and so far, our guys are just killing it as far as taking those shows, like to say we recently made the power to hulu, and monetizing those in second and third windows

>> michael, good to see you. >> thanks so much. >> vice chairman of lions gate >> check please is next. ready or not, here i come.ek.) ♪ anyone can dream. making it a reality is the hard part. northrop grumman command and control systems always let you see the complete picture. and we're looking for a few dreamers to join us.

final thoughts, mine is on crude oil. we've talked about this a lot. just a reminder about 2015, 2014, i know it's cheap gas,

that's great, we love cheap gas. there's also still a ton of debt on the books of these oil companies. ive wonder if melissa and michelle just something to pay attention to >> look at the european banks, they're more exposed to the high yield oil issues so we could -- we saw that year and a half ago with shares like deutsche bank, we could see that again. >> and many still have trouble that they never revolve. george clooney, hat's off for selling a liquor company for a billion dollars. it's a great country, isn't it >> that's it >> green light >> i mean -- >> are we trying to rub in you're making me feel terrible about myself these guys have -- >> taller than george clooney. >> not they stand on their wallet >> true. >> they'll be taller than everybody now. >> a lot of speculation on who apple should buy, right, apple, netflix, looking for content we've got analysts on tonight and says health care data, health care data company is what

apple should buy next. we will make the case tonight. we'll name that name tonight >> how about they make icloud e-mail better. >> or siri >> buy gmail >> thanks for watching "power lunch. "closing bell" starts right now. >> does anybody on december 21st say yes, it's the first day of winter >> i'm glad because i feel like i haven't taken full advantage of the season yet, i've got to go -- >> we've had a lot of rain you have to go to cape cod this weekend. >> it's a good cause, bachelorette party but the traffic is going to be -- >> i'm going right into the heart of the storm here. >> we have a storm coming? >> welcome to the