world player of the year turned president of liberia so that's -- >> the white house actually c congratulated liberia on the results of this election. >> been great having you here. >> my pleasure. >> arsenal is your team i'm told. >> they are. >> they're doing okay, not great. >> we won last night but that was rare recently. >> all right have a great new year's. good to be with you. >> happy new year. thanks for watching. "closing bell" is next

>> e-commerce growth that even as they do sends some other packages out through u.p.s., fedex, logistics and others the vast majority, something

like two-thirds of their packages go the last mile delivery to people's doorsteps through the postal service back over to you. >> sometimes postal service delivers on sunday >> specifically for amazon, several years ago. >> thanks, morgan. let's talk about this. are the president's attacks on amazon a sign of bigger issues ahead for the company? >> donald, and dave are both with us. welcome to you both. tom, you think a strong argument could be made that amazon is getting a sweetheart deal here right? >> i definitely think if you look at the research i've read, they're getting as much as a $1.46 subsidy on a per-package basis. i do think in the case of the u.s. postal service amazon is definitely getting a sweetheart deal, yes. >> donald, what about you? >> well, absolutely. you know, the bottom line is the post office is subsidized its parcel delivery through its

first-class mail for years, decades really that's why it's running at a 20%, 30% discount to the rates you're going to see via u.p.s. or fedex the beneficiary of that, of course, is amazon or anybody else who uses them for that last mile and to what the point that morgan made just a few years -- a few minutes ago, and you as well, bill, it's one thing to say that that should be allowed because they're going, anyway, to deliver first class mail. when they're going specifically on sunday, well, then the bleeding turns into massive hemorrhaging and they're doing so for one for the benefit of one customer, which from the outside looking in, just doesn't make sense. >> okay. you know what, i mean, we seem to be blaming their losses on amazon but the post office has been losing money well before amazon was ever invented. >> i'm not blaming -- great point. great point. >> i know you're not specifically, but we're thinking and the president's tweets suggests that it's amazon that's

causing the postal service to lose as much money as it is because it doesn't charge enough at this point. so, how do we solve the post office's problem in this case, i guess is where i'm going with this, donald. >> well, great -- you make a great point. first of all, this -- this president wouldn't be the first policymaker to gloss over the details. but that said, the bottom line is that you should not be for the benefit of one customer in a fashion that is detrimental to private companies that pay their own way, subsidizing amazon. whether it's amazon or any others there should be more fair -- a real balance in what the costs are in delivering that parcel, whether it be for amazon or jet.com, or nobodyieverheardof.com it's a price that more fairly reflects the cost to make that

package happen and, indeed, that's what happens when you pay fedex or u.p.s. to deliver. >> tom, my understanding this came about because in part mail volume is down 40% from its peak so the u.s. post office has this fair capacity that it's basically just letting amazon boxes ride on and in 2006 there was a congressional act requiring the post office not to und undercharge anybody. i think to harmonize what it charges, period. so is it up to congress now to either enforce that better or can the post office tomorrow just say, okay, we're going to raise the rates for amazon, and what happens to taxpayers if amazon then goes elsewhere and doesn't use that service >> sure. so i think if you step back for a minute, you look at retail, there's clearly a need for a third participate beyond fedex and u.p.s. which arguably operated duopoly i think what we're talking about here is getting amazon to pay a fare rate from the service from

the postal service and generally speaking getting the volume of sales in the postal service to be enough for them to offset their cost but you bring up a good point, kelly, basically the challenge is that the first-class mail volumes continue to go down for a lot of different reasons. but clearly e-commerce is heading in the right direction and if they can get both an increase in volume and perhaps a more fair market rate from amazon, that could go a long way. >> but is amazon going to stay -- tom, continue to use the post office if it has to pay more, do you think >> absolutely. if you look at what amazon's doing in general, they're increasing their own first-party logistics efforts because, "a," they need to and "b," they realize they're overreliant on fed fedex, u.p.s. and a lesser degree the u.s. postal service the good news is amazon continues to grow. i think there will be an opportunity for increase in volume with all three of those carriers, u.p.s., fedex, and the u.s. postal service. so i do think there's an opportunity if they charge a

fairer rate, there still be lots of volume from amazon for them to take care of. >> all right i think we should ask what would benjamin franklin do right? >> as long as the price of stamps doesn't go up anymore. >> wouldn't necessarily use legislation to make it fair. you made an interesting point earlier, kelly, when you said that -- the rules on postal -- the rules on postal have actually led to some very strange pricing. so that -- disparity in long haul, if you were to gofrom ne york to los angeles, is 30%-plus cheaper via the post office, but if you're going to go from, say, you know, new york to new jersey, you're going to find actually the services are very competitive, in fact, u.p.s. and fedex in some cases may be cheaper because the post office charges a flat rate. >> well, we'll see if that ends up changing the dynamic. guys, thank you, again, very much appreciate it. donald and tom forte. let's take another quick

check on markets we mentioned goldman was off its lows, that might help push the dow into positive territory. the blue chips are down 28 points the s&p down four right now. the russell down six it's been a year of records for stocks across the board and the world of etfs saw some records of its own bob pisani has those details bob? >> hello, kelly. 2017 was a record-breaking year on all fronts for the etf business look at these numbers. inflows up nearly $500 billion asset under management $3.5 trillion mutual funds, getting there. money poured into u.s. stock funds but also into these international equity funds because the global economy did so well. investors are still looking for a yield. they also put a lot of money into u.s. fixed income funds now, not everything was a big winner investors took small amounts of money out of high-yield funds and mexico funds, a reverse trump trade. gold miners saw outflows de spite talk of an infrastructure plan, utilities and transports both had outflows for the year now the story for 2018 is absent some kind of massive volatility,

investors will continue to take money out of mutual funds and put them in lower cost etfs. stock pickers will continue to lose investment dollars. money will come out of active management funds and into funds tied to indexes like the s&p 500. most importantly, money will come out of funds that charge higher fees, and into funds that charge lower fees which is why etfs keep coming out ahead there's the biggest etf of them all, the spdr. the important thing, guys, you can get into these plain vanilla index funds like the s&p 500 for under ten basis points that's $1 a year per thousand. t many others are lower than that. investors are the big winners because they just keep cutting the prices year after year guys, back to you. >> amen. >> guy bob, thank you very much. see you on the close. let's get to our favorite topic this week, taxes and the rush by companies to figure out the new rules before they take effect goldman sachs already announcing they will feel some pain

that stock was among the worst dow performers today ylan mui is live in washington with the latest. ylan >> reporter: bill, this new tax code is creating headaches for a lot of companies the international rules and shift to a territorial tax system, those are some of the most complicated parts of this new tax law. today, of course, goldman sachs announcing a bigger than expected hit to its bottom line largely driven by the mandatory repatriation rate. q4 earnings will be lower by $5 billion. analysts estimate repatriation rates could result in $1 billion-plus tax bills for other banks as well. bank of america, citigroup, amgen owes $6 billion in taxes on its overseas earnings one note of caution, the treasury department still needs to write rules that could change how much foreign income companies women actually be taxed on also companies can pay that bill in installments over the next eight years and those payments are backloaded with 25% of the

balance not due until 2025 there's also another outstanding question bon bonuses. commissions. stock compensation currently they are all taxed at 25%, but under the new tax law, that could jump to 28% the irs still has to sort out that answer as well, guys, and now there is new pressure from senator marco rubio who is questioning whether corporations got too big of a tax break in the tax plan even though he voted for it guys, back to you. >> wait, what do you mean he's questioning it >> oh, he's saying that perhaps the tax plan went too far in giving corporations tax breaks instead of focusing on the middle class as president trump had originally intended. remember, he was fighting for that larger child tax credit he was won over at the end of the day but he did an interview with some local media down in florida today and seems to be, perhaps, having second thoughts about his vote >> oh, a little late for that now. >> i'm -- >> yeah. >> wow >> january 1, it's all happening. >> yep

thanks, ylan see you later. happy in u year. as corporations scramble to figure out the rules, individuals, they're still lining up to prepay their property taxes in various states and no state has higher property taxes than our state new jersey eric chemi is live in hoboken with that story. how are the lines today there? i guess they lightened up a little bit, huh? >> reporter: so there are people that have been coming out, in and out, in front of the tax collector's office only 45 minutes to go before they close down for the rest of the year re a lot of people don't know what is going to be deductible. we talked to the newly elected mayor of hoboken this morning. as you can hear, he's not 100% sure either. here's what he had to say. >> we're following the lead of the state. the governor's executive order requires municipalities to accept prepramt prepayments for entire year. that said, it's unsure whether the prepayments would be dedu se

deductible for the third and fourth quarter >> reporter: there you go. they've been come in hope to take that gamble they're here paying hoping to see if it's deductible here's what one person we talked with said about that >> i figured i'd take my chances. it's a little bit of an advance too t to the city which is fine for the city and it may be that i can only deduct half of it >> reporter: so there you go, the ir, is is saying one thing, governor christie is saying something else there's different cities and counties are all saying something else we're seeing different stories depending where you are. most people are coming figured let me see what i can can do, maybe some of it will be deduct bl back to you in the studio. >> a quick humble suggestion, somebody out there must know the answers, in the government i would think, and they should be holding a news conference to answer those questions. >> at what level, though the irs came out with its guidance. >> it gave us one paragraph. >> you had westchester county

yesterday say, sorry, we can't give you the assessments eric, where you are today, they say, sure, we can. in the meantime, everyone thinks, weld, juif the irs decie more lenient, maybe i better go, anyway. >> somebody's got to know. there's somebody out there that knows and should hold a news conference eric, thank you. we'll leave you to the excitement there in how hogan. see you later. a lot more ahead as we count you down to the "closing bell. >> next, the pulse of the retail investor see what they're expecting and how they're repositioning for opportunity in 2018. plus trouble in toyland. nobody wants the american girl but there may be a new-age partnership that may change the story. don't forget, we want to hear from you reach "closing bell" on twitter, facebook or shoot us an e-mail osgbl@bcom this is the "closing bell" on cnbc first in business worldwide. dad promised he would teach me how to surf on our trip.

when you book a flight then add a hotel you can save. 3 waves later, i think it was the other way around... ♪ everything you need to go. expedia. [lagale force winds,s absolute chaos out here! accumulations up to 8 inches... ...don't know if you can hear me, but [monica] what's he doing? [lance] can we get a shot of this cold front, right here. winter has arrived. whooo! hahaha [vo] progress is an unstoppable force. brace yourself for the season of audi sales event. audi will cover your first month's lease payment on select models during the season of audi sales event. feel that? that's the beat of global markets, the rhythm of the world.

but to us, it's the pace of tomorrow. with ingenuity, technologies, and markets expertise we create the possible. and when you do that, you don't chase the pace of tomorrow. you set it. nasdaq. rewrite tomorrow.

welcome back let's get straight to our "closing bell" exchange to round out the year today tom plum joins us from wisconsin capital management new york stock exchange trader jonathan porpina at post 9 from meridian equity partners rick santelli joins us from the

cme. welcome to you all all right, jonathan, a number of factors to look at into the end of the year here we can talk to rick about the dollar later, but what do you think about the setup here as we close things out >> this is kind of playing out the year end as we expected. once we got to december 15th, which was a large option expiration, a large rebalance, it gave portfolio managers an opportunity to really shore up their positions at the end of the month, end of the quarter. since then it's been relatively quiet. obviously been talking about tax reform, how that's going to impact individuals and corporations moving forward. interestingly enough, we get right into the new year next year unemployment number comes out next week. i think that will get investors who have been sleeping, you know, watching this market, getting tired from watching it, will get them back interested as we get into the beginning of 2018 >> tom, i hate to start with a specific stock, rather than higher altitude, but i notice one of your picks is a company called tyler technologies, which is the number-one company providing software solutions to local governments. i wonder if they allow prepayments of property taxes on that software.

>> not -- i don't think so no you can't prepay it. >> well -- >> but you can pay in 2017 >> yeah. >> right >> zwhat are you looking ahead t for 2018 i mean, what are your themes >> you know, the world economy is still improving and in that environment, stock market tends to go up i know a lot of people are concerned about the market and think that it could go down pretty dramatically. but the plumb funds we're fully invested because we think we're in for a good economy and good economy leads to good markets. >> there's constellation and visa, a couple of your other picks. rick, i don't mean to keep beating the drum you think there would be a global demand for dollars and the thing is so weak again what does this tell you? >> reporter: the turn isn't. what what it used to be. lot of issues of recent legislation have made year end more questionable. dollar index closed on its lows

today, closed on its lows yesterday. down a whisker below 10% for the year yeah when you really put it in the context of history, you know, when we have all these yield curve conversations, i always say, listen, you can't look at the yield curve. long-end rates are distorted we had the biggest thumbs in the world on the scale for years well the same could sort of be true for what's going on in the interest rate and dollar market. when you look at the dollar and think of how strong stocks are, you look at interest rates or the curve, look at how strong stocks are, normally rates would follow stocks. normally, rates and stocks drag up the dollar. so there's a lot of discontinuous activity in the relationship between the major sectors. i think it will continue into 2018 i'm very optimistic. i think we're going to see another big year for stocks. i think interest rates will creep up, but the buying and distortions of the long end will prevail so there's going to be shock absorbers to the long end. i think the biggest surprise for 2018 is going to be on the

political front. whether it's in europe, whether it's in italy. the brexit theme is alive and well in this country, i have a feeling that the midterms are going to be shocking to one party. i'm not thinking the republicans here >> all right very good. happy new year to all three of you. t thanks for joining us. >> thank you. >> happy new year. >> see you later. elsewhere mattel's newest doll and elon musk share at least one thing in common. they both have aspirations of traveling to mars. that's not what you were thinking, was it s that necoming up next, though which trends will ro roll into next year, and what theme should investors look for? that next on the "closing bell."

i put everything into my business. and i had all these points from my chase ink card. so i bought ingredients, utensils, even made custom doughnut 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. what will you create with your points? chase for business. make more of what's yours. i just finished months of chemo. but i don't want to talk about months. i want to talk about years. treatments have gotten better, so... i'm hoping for good years ahead. that's thanks to research funded by the american cancer society. the same folks giving me free rides to treatments, insurance advice,and a place to stay during chemo. i need that stuff like you don't know. and now that you do, please give.

call 1-800-416-4357 today. your contributions to the american cancer society fund valuable research but that's just the beginning. a cancer diagnosis can kick off years of challenge. and that's where your donation truly shines. you help us fund free rides to treatment. a live 24/7 help line, free lodging near treatment centers, and even efforts to expand access to insurance. so, please - donate today at cancer.org and help attack cancer from every angle.

toy maker mattel betting on a partnership with nasa to boost sales of its american girl division next year the company's new doll, let's take a look at her, there she is, she's an aspiring astronaut. she's their 2018 girl of the year and is available for order starting monday. shares of mattel under pressure down 44% year to date. as toy companies continue to face slow sales, shifting consumer demands and, by the way, as hasbro with its "star wars" franchise continues to mop it up. >> so her name, you're going to name the ball, the aspiring astronaut, of course, luciana vega is what would come to mind.

clearly we have an issue with toys the industry kids are playing more video games, digital games, all that they're not playing with physical toys anymore. >> i haven't kept up when i was young, in school, a friend would bring a catalog of the american girl dolls, i thought there was four, five of them. >> there's a whole family. >> i'm looking now, maybe there's many more. i don't remember it being job specific i thought it was more, you picked the up that kind of looked likeyou or reminded you of yourself or something. >> not that anybody asked but my prediction for the toy industry next year, a lot more consolidation. there's got to be. these guys are just killing themselves on market share and lack of profitability as they deal with a major shift in how kids play with toys these days toys "r" us is a classic example of what's going on right hnow. >> i think that's the barometer. >> absolutely. >> watch for consolidation next year. >> there's mattel hoping 2018 is a different story and luciana can help them out. >> go, luciana. >> 34 minutes to go until the

close. dow down 21. nasdaq down .25% russell 2000 small caps down seven. shedding half a percent here. as wall street storms to record after record regardless this year, are retail investors reaping the rewards? we'll find out in our latest installment of the "closing bell investment club. see where main street is betting right now. and from apple to amazon, tech investors have cleaned up this year with big gains outperforming the broader markets. we'll talk trends for 2018 in tech coming up [hawaiian music playing]

it's time now for a cnbc news update. let's get over to contessa brewer hi, contessa. >> hi, kelly, hi, bill, here's what's happening president trump played golf with 60 members of the u.s. coast guard today. the president praised the ghoco guard for their response efforts in florida and texas the white house said this was a big thank you for their service. the head of a uk-based cryptocurrency exchange reportedly has been released after paying a ransom of more than $1 million worth of bitcoin. lerner was kidnapped earlier this week in ukraine and held for a day and a half according to the reports. at least 30 car accidents blamed on icy, snowy weather in genesee county, michigan

more snow is in the forecast rough one out there. check this out, a woman handcuffed in the back of a police car able to get out of the cuffs, slither into the front seat and steal a police car while the dashcam is all rolling. did you see this very agile and what was she arrested for in the first place? police say her car was broken down on the side of the road, when a good samaritan stopped to help her, she stole the car. she faces a long list of charges. apparently, got out of one tight spot only to land right back in another. that's the cnbc news update at this hour. >> there's a lot of the story that we don't know about, i think about that there's something going on there we don't know about. thank you, contessa. >> sure. >> see you next hour. >> okay. yes, we're heading toward the whoop-whoop in about two minutes. you're going to be hearing all that just about half an hour left to go in the final trading day of the year the major averages are lower today, but the market did have its best year overall since 2013 the dow saw its first 5,000-point gain

we blew through that many millennial marks this year that has never happened before the nasdaq led the way with a 29% jump in 2017 >> and the most record closes. >> she gave it away. she gave if away. >> i hope that wasn't coming up later. >> well, it's not now. >> oh, no. >> it's okay. let's move right along and check in on main street. this is the perfect time it's our monthly "closing bell investment club" and today we're joined by retail investors wayne smalls and jackie cummings kosky. welcome to you both. >> happy new year, guys. >> hi, happy new year. >> wayne, let's start with you 20 2018, what excites you, y are you putting your money >> first and foremost, i really enjoyed 2017 so much with all the indexs hitting 20%-plus gains. i decided to celebrate today with my green tie because that's how it's been. going into 2018, i'm going to take a little bit off the table and take a more defensive

approach, especially starting after may. in may, that's when you'll see a lot of sellers, typically, especially as we lead into the next election cycle, and so it's going to be playing safe for me. a little bit until -- >> you're going to be harvesting some of those profits i guess is what you're getting at for next year >> absolutely. >> skbrjackie, what about you you can always find something to buy. what are you looking for for next year? >> that's right. as great as 2017 was, i certainly found a few laggards or great companies had a little bit of a pullback. i expect to do the same thing in 2018 i feel like the momentum is going to continue into 2018. there were a few stocks that i did take a position in this past year, even though the market as a whole was up nike was one of them and also altria and kroger.

>> is wayne, i take your point about pulling back a little bit, you still like apple, like salesforce got a home renovation play even, right? >> yes, yes, i still like apple. going to stick with it true the next quarter earnings and strategically make stock option plays mainly based around earnings like the tile stock option i recently bought and in stm. i'll take that risk management safe method. it's worked well for me for the last three months. what's great, 300% gains in stock options like urban outfitters and in options in lululemon. that's going to be my play or strategy going forward the next six months or so >> jackie, i'm curious on kroger, i mean, clearly we all saw the acquisition of whole foods by amazon and there's talk that a lot of the big grocery chains are going to have to be bought up to compete is that why you're picking a kroger necessarily because of the m&a possibilities?

>> well, i think there are some m&a possibilities but for me, i feel like kroger really got hit hard after the news of the -- of the amazon and whole foodsing a decisi acquisition. it got hit harder than it should have i wanted to take add vvantage of that buying opportunity because they've been on my watch list for quite some time and there's enough room for plenty other players in that space, not just amazon, but i believe that competition is great for the consumer, so i'm really looking forward to kroger and walmart doing pretty good up against amazon next year >> you sound like a classic value investor, i guess, right >> i would say so, but i like to get a lot of growth, too, which is why i held off on purchasing kroger until i saw this recent pullback this summer so, value investor, but i also look for growth. kind of a mix of the two >> i also wanted to ask you both, jackie first to you, what are the personal impacts you're

feeling from the tax bill? how's it affecting your investments? >> for me -- >> jackie first. >> -- i feel -- for me, i feel like it actually will continue the momentum because of some of -- a lot of the positive things with the tax bill i was really happy to see that the first in/first out rule did not stay in the final tax bill >> right. >> so the first part of the year i'm pretty bullish >> wayne, what about you >> well, i think that we can see increased -- a little bit of increased buyback opportunities with companies since they are -- face less challenges tax wise and consumers with more capital spend also capable of making really great buys in the stashlstock market particularly in the etfs. i'm positive about it. >> wayne, are there positive effects you're feeling, in other words, where you're prepaying

your property taxes, a lower tax rate, whatever the case may be, is there anything that's personally affecting you when it comes to -- >> oh, no. everything i looked at so far has been just been perfect with regards to my life right now yes. >> and jackie, we got to go here, but you did prepay your property -- you live in ohio >> yes >> where property taxes are much lower than they are on the coasts but you prepaid for property taxes, didn't you? >> i did prepay my property taxes because next year more than likely i will not itemize since they doubled that, you know, number so i figured if i'm not going to get credit for it next year, why not just push it into 2017 and take the deduction when i can? because next year i probably won't be able to if i don't itemize. >> always thinking always thinking, these folks very good. we always enjoy talking with you. thank you wayne, jackie. >> happy new year. >> happy new year. >> profitable investing to you we have 23 minutes left in the trading session here the dow is down 37 points. all the major averages are lower

right now. just capping off a stellar year. president trump with another twe tweetstorm today offering an infrastructure plan with a mind-boggling number, but no plan to pay for it larry kudlow and john harwood will tackle the tweets coming up i like that. >> tackle the tweets >> tackle the tweets. >> a good one. first, recode's ed lee joins us to peer into the tech cstryal ball, tell us what to look for in 2018, and hopefully it's not that my experience with usaa has been excellent. they always refer to me as master sergeant. they really appreciate the military family, and it really shows. we've got auto insurance, homeowners insurance. had an accident with a vehicle, i actually called usaa before we called the police. usaa was there hands-on very quick very prompt. i feel like we're being handled as people that actually have a genuine need. we're the webber family and we are usaa members for life. usaa,

get your insurance quote today. (news anchor) downtown traffic is still bad. expect massive delays. (news anchor 2) all lanes on highway 50 remain closed at this hour. (news anchor 3) the stats are in and this city leads with some of the worst traffic, with the average driver sitting in gridlock the equivalent of three days a year. for every hour that you're idling in your car, you're sending about half a gallon of gasoline up in the air. that amounts, over the course of the week, to about 10 pounds of carbon dioxide. growth is good, but when it starts impacting our quality of air and quality of life, that's a problem. so forward-thinking cities like sacramento are investing in streets that are smarter and greener. the solution was right under our feet. asphalt. or to be more precise,

intelligent asphalt. by embedding sensors into the pavement, as well as installing cameras on traffic lights, we will be able to study and analyze the flow of traffic. then, we will take all of that data and we use it to optimize the timing of lights, so that traffic flows easier and travel times are shorter. and sacramento is just the beginning. with advances in cameras, sensors, and network speeds, we have the ability to make cities smarter, and happier. what excites me about this technology is that we're using some of the most cutting-edge machine-learning, and ai, to help solve the most fundamental challenges that cities face around the world. who knew asphalt could help save the environment? (lani) and the possibilities are endless.

welcome back as we look back on the performance this year, here's a look at the sectors of the s&p 500. we all know the first one, technology, up 37% but how about materials? this is what we were talking about with mike yesterday, material and consumer discretionary neck and neck. materials edging out right now for about a 21.5% gain financials, not far behind, in fourth place, up 20.5%. >> energy and telecom the laggards intersensitive. >> yep. >> dollar sensitive. >> telecom has some of its own issues that's been weighing on the debt markets, too, even. crude's as 60. who knows for 2018. the rise of robot and

artificial intelligence. big tech shifting media, those are all apparently in our long-term future. >> long term what about the near term, what about 2018 we're joined by ed lee, managing editor over at recode. what are you seeing in your near-term crystal ball, sir? >> near term, first of all, there's going to be a lot more activity with media sector and tech sector. i think you're going to see a lot more intermingling, more deals, more potential deals. both sides are sort of what's happening is the big media companies are consolidating, findingconsolidate, trying to, at least, ahead of tech eating their lunch. big media companies whether fox, time warner, et cetera, are tied up in these deals. tv advertising, it's still in tv hasn't fully shifted online. facebook, google, maybe a little brit of bit of apple they're taking baby steps in there. they're trying to bolster themselves up before they figure that out. >> two categories, when a

company mentions they're involved in it, the stock goes up cloud. >> cloud. >> and streaming >> cloud and streaming. >> think that will continue? >> our crypto or bitcoin any kind of blockchain element i think streaming is definitely the future for both ends of that spectrum, right? you're going to see apple spending $1 billion on original content, facebook is going to do the same youtube, you know, they've been quietly doing that as well haven't had as much fanfare. despite youtube has been around for so long. what it tells us is this, this long sort of decade-plus experiment in online video the way youtube has seen it doesn't work, right? it works enough to get eyeballs, get some advertising hasn't killed television, right? >> right. >> facebook knows this apple knows this if they're going to succeed there, if they're going to win those customers in the right way, and those advertisers, they have to spend real money and create real content. i think that's where -- so be on the lookout for lionsgate or sony pictures, maybe even a paramount. these are attractive properties if you have a big distribution platform like a facebook, like

an apple. >> it or the one disney is is t trying to build. >> bob iger knows this he figured this out. they took a look at netflix this year, last year. not because it has great content operation, which it does, it has 50 million u.s. subscribers. that's distribution right away right off the bat. >> what about the regulatory issue? with each passing day, there's another story out of washington about, you know, the one we had from axios recently, oh, you know, mark warner's office has brought in silicon valley skeptics to talk about how damaging these companies can be for your health. we're talking about them, you know, sean parker, look at the guys like that, saying they're creating addictive products, that they're bad for you, not letting their kids use them. what -- where -- >> it's interesting in congress you have these strange bedfellows now, right, when it comes to tech. you got guys on the left like warner saying facebook could be used, manipulated to look at the election, what happened there. you got guys like trump, you know, sort of tweeting this morning about amazon's too powerful, and they're not getting charged enough by the u.s. postal service. what's going to happen is these

companies, they're so rich now, they're so, you know, they're on the rise, it's going to invite that scrutiny. right? i think you're going to see more at that going into next year >> resulting in what more regulations >> ironically -- >> antitrust >> -- in a trump administration, he's been proposing this idea, fewer regulations. unless it comes to tech, right i think you'll see more scrutiny i think you will see, i don't know, that doj could take a closer look at amazon, is this a monopoly, right? should we investigate this and maybe bring a suit against them? >> the president has asked that question in the past. >> he's asked that question in the past of big investors. investors have basically said, cooperman who staaid this on cnc a few weeks ago. he asked me about that, i today him no i think they're doing better than others. i agree with that analysis trump white house, a trump administration, you never know look at what happened with at&t/time warner merger. they're facing a lawsuit that's a vertical merger by definition, by conceit, it's not anti-competitive

whereas the fox/disney deal, which is a horizontal deal, chances are it's more anti-competitive they get a pat on the back from trump, right >> let me ask you a quick direct question as part of this before we go, do can you think the at&t/time warner deal gets approved >> on the legal merits they can and should i talked to experts about this, they said to the judge assigned to the case, it's going to come down to a battle between experts. it's not going be a data economics argument it's going to be who's got the better experts, who can explain the tv landscape better? if at&t does it right, they'll make it clear to the judge that their competitors aren't other tv companies, it's the internet, right? it's facebook, apple what we talked about at the top of the segment i think that's where they're best so sererved ed by that art if they do it well, they'll win. >> we always like chatting with you. great insights happy new year. >> thank you. >> ed lee of recode joining us at post 9. we're heading to the close with 14 minutes left the dow, major averages are lower. capping off a big year, though, the dow had 71 all-time highs

this year. nasdaq had more. >> market watcher david darst will be here with his market theme of the week and it truly is the last word to m tsuuphe year that's next on the "closing bell." feel that? that's the beat of feeglobal markets, the rhythm of the world. but to us, it's the pace of tomorrow. with ingenuity, technologies, and markets expertise we create the possible. and when you do that, you don't chase the pace of tomorrow. you set it. nasdaq. rewrite tomorrow. your bbut as you get older,ing. it naturally begins to change, causing a lack of sharpness, or even trouble with recall. thankfully, the breakthrough in prevagen helps your brain and actually improves memory. the secret is an ingredient originally discovered... in jellyfish.

in clinical trials, prevagen has been shown to improve short-term memory. prevagen. the name to remember. yes or no?gin. do you want the same tools and seamless experience across web and tablet? do you want $4.95 commissions for stocks, $0.50 options contracts? $1.50 futures contracts? what about a dedicated service team of trading specialists? did you say yes? good, then it's time for power e*trade. the platform, price and service that gives you the edge you need. looks like we have a couple seconds left. let's do some card twirling twirling cards e*trade. the original place to invest online.

welcome back. >> happy new year to, from the great peter tuchman. >> happy new year. >> you celebrated a big birthday this week. >> 55 for 5 years. >> i was going to say 40 i'll give you that. >> that's okay. >> happy new year. >> i like how the glasses are getting more high-tech along with the rest of society. >> supplies all the hats, too, in case you're wondering that's where they come from here on the floor joining us on the new york stock exchange, dow down 41 points, our dear friend the independent investment consultant mr. david darst. >> thank you very much happy new year to you, kelly, to you, william this year's theme -- >> what's our -- what's our final acronym? >> our final acronym should be the word, f.i.n.a.l. first we're going to start out with the frenzy and the fever over tech stocks not only the faang stocks in the united states, facebook, amazon, apple, netflix, google but also the b.a.t. stocks in china, baidu, alibaba, and tencent, up almost double what

the big tech stocks have done in the united states this year. "i" is infrastructure next that's driven copper up 16 days in a row, as you've seen, which is a record run for copper also the rebuilding from the hurricanes this year that's created demand for copper so commodities would be another theme for next year i think. >> okay. >> the "n," new tax rregime. earnings are expected to but 12% next year. you can have more with the tax benefits going through and if money comes back and stimulates the economy. national federation of independent businesses optimism index is also at record highs which is where job creation takes place. "a" is another leg higher. be careful, though, another leg higher does not necessarily mean in the u.s could mean emerging markets. japan and europe which i favor a little bit you got to be more selective in the u.s. banks, things that can help if interest rates start to rise and the "l" is look, learn, and

live look, learn, and live. look out we are at high valuations. low volatility ipo volume is at very high levels m&a volume has been driving this so you want to basically become more selective the peloponnesian wars about sparta and greece, always in victory, prepare for defeat. that's the look. the learn is learn from past records, past mistakes and the live is live it up trova is written on a flag in basari's famous painting of tuscany, the battle between florence and sienna. look and ye shall find that's the theme for 2018. look and ye shall find >> who was that artist >> that was vasari v-a-s-a-r-i. he's a florentine artist about their victory over sienna. >> i'll mention he's not working from any notes there's no teleprompter.

>> no, all up here. >> i don't know where it comes from. >> i'm around you and kelly, it's like perpetual penacost and i'm an apostle speaking in tongues. >> i had no idea that final had three ls that's amazing. >> next week we have the jobs report we'll see how december jobs cams out. you have the all-important ism manufacturing. what's not to like jobs, housing, confidence, retail sales what's not to like that means you got to be very careful. >> did you prepay your property taxes? i know where you live. i know that there's a big questions about whether they -- >> look at the look on his face. >> -- would allow it there. >> i asked the accountant steve cohen. he said prepay what you owed for this year, that would be paid next year. >> we don't know we don't know. it wasn't assessed. >> the 2017 -- no, not property taxes. income taxes okay >> they're not letting you >> is see, you can pay that because it's due january 18th. pay it now that you can't -- >> estimated tax. >> that's right, the estimated tax. pay estimated taxes now. >> i want to go back to -- that

was easier to understand than this -- than this tax reform bill going into effect >> have a great new year's happy new year thank you. >> can we truly have the same kind of year next year in the stock market we had this year? a lot of people are saying that. >> bill, kelly, we moved from an unloved market the past seven, eight years. this year was a year of it being a loved market there will be a correction and shake out the weak holders, but we'll move now to the next final level of this shakespearian drama called an overloved market and that's what we're getting ready to go into but there will be some things you'll miss the last part of the party if it gets shaken out by something. the market is driven by profits. trump, north korea, the fed, forget it. profits are driving the market right now. and that's -- as long as they're intact the market can go higher. >> sounds like our friend, mr. kudlow. >> yeah. he said that i did not quote him.

>> happy new year. >> thank you so much happy 2018 thank you for a great year. >> all right we'll come back, wrap up the year with our "closining countdown. after the bell, goldman sachs reporting it could take a hit in q4 because of the tax reform bill. we'll tell you what investors edo ow coming up keep it right here you wat you're watching cnbc, first in business worldwide (beep) bill has joined the call. hey bill, we're just- phone: hi guys, bill here. do we have julia on the line too? 'k, well we'll just- phone: hey sorry. i had you muted. well yea let's just- phone: so what i was thinking- ok well we'll- phone: yeah- let's just go ahead- phone: oh alright- the award-winning geico app. download it today. the chase mobile app changed the game for us. we had this plan to go to the hottest place on earth, harness the energy from the sun to develop popcorn. we thought we had the right equipment, we quickly realized we needed more.

we were able to send a wire transfer to a local vendor and get more solar cookers delivered, right here in death valley. manage business expenses from virtually anywhere. the chase mobile app available with business checking. chase for business. make more of what's yours. the market.redict but through good times and bad... ...at t. rowe price... ...we've helped our investors stay confident for over 75 years. call us or your advisor. t. rowe price. invest with confidence.

yes or no?gin. do you want the same tools and seamless experience across web and tablet? do you want $4.95 commissions for stocks, $0.50 options contracts? $1.50 futures contracts? what about a dedicated service team of trading specialists? did you say yes? good, then it's time for power e*trade. the platform, price and service that gives you the edge you need. looks like we have a couple seconds left. let's do some card twirling twirling cards e*trade. the original place to invest online.

2 1/2 minutes left in the trading session for the year and what a year. we began the year on the dow in the 19,000 range, and even the most optimistic bulls were saying we could see 22,000 by the end of the year. we blew through that in no time. and for the year, the dow saw 71 record closing highs it was positive 11 out of the 12 months this year unbelievable the s&p had 62 closing highs this year but the nasdaq had the most 72 closing highs and it was the best percentage gainer at 29% this year. can we do it again next year that remains to be seen. we will see. the dollar went down for the year had its worst year since 2003. bit of a conundrum as we get ready for higher interest rates in 2018. the dollar goes lower. gold went up up 13.68%, bob pisani. its best year since 2010 and listen to this, wti crude

oil hit 60 -- it's above $60 a barrel. >> yep. >> is closing above that level at the end of the year for the first time since 2013. where were we at 2013? >> 2013, $100. >> almost. we were around $99 a barrel. that was only four years ago >> we forgot >> i've been slipping -- >> leave your photo at the door. of course, we'll see what happens with the interest rate picture next year as the fed begins raising rates. >> nobody bought into that oil rally story even though we closed at a two -year high i was quite pleased. people got burned badly trying to buy bottoms in oil stocks several times throughout the year and finally they stopped. even the oil went up you watched the oil stocks they went sideways the big thing for 2018 is will the global expansion really continue look at the double-digit gains we saw all around the world. the philippines and vietnam and brazil everything is up 20%, 30%, 40% not clear. the one thing that's important is you and i will be together in

2018 as we have been for many years. happy new year. >> happy new year. >> best of health to you in 2018 along with your family. >> big selloff on the close. the dow suddenly down 87 points, but still closing out a big year on wall street happy new year, everybody. stay tuned now for the second half of the "closing bell" with kelly evans and company. have a great weekend, kell you, too, bill thank you very much. welcome to the "closing bell", everybody, i'm kelly evans big selloff on the bell here let's take a quick look how we're finishing up the day first on wall street, dow dropping 89 points, puts it back below 25,000 to close out the year we lost that 5,000-point rally we talked about. the s&p 500 down about nearly half a percent today nearly 12 points to 2,675. the nasdaq composite giving up .67 back to 6,903 the russell 2000 down nearly 1% on the bell here to 1,535.

so, again, moderate declines what started out as gains this morning turned into modest declines, turned into sharper ones on the bell today. also a noted analyst doubled down on goldman, despite its warning about the new tax bill, while calling for ceo lloyd blankfein's ouster we'll have more coming up. senator marco rubio saying in an interview with a florida newspaper that the tax plan unfairly benefits corporations larry kudlow will join us with our take you'll not want to miss who he's facing off against later in the show. joining me, michael santoli. chris johnson from johnson research group michael from the permanent portfolio family of funds. welcome, everybody 2017 is now in the books, folks. the best performing stock on the dow for the year was boeing with the 90% gain ge was the worst performer, dropping 45% alliant technology maker of invizaline braces was a big winner on the s&p 500 up 130%

this year and range resources was the worst with a 0% decline. michael, what do you make of it all? >> obviously ending on a down-beat note don't know if there's enough to be taken except these are year end portfolio adjustments. did not really affect the trend. in general, i feel as if the market is kind of resting on the fact that it had this almost effortless advance for most of the year up 20% is obviously something very few expected a year ago. >> i want to show the dow again because even a couple minutes after the close, we continue to settle at lower levels turns out the blue chips down 105, now 108 and counting on the bell. >> clearly a lot of supply was there to be executed on the close. some of the pentup selling i don't know if it foretells what's to come in early january, although we are now below that level in the s&p 500 of the so-called santa claus rally. >> 2,685 was the santa claus art cashin, anything art emphasizes we want to see this

rally every year right now we're 11 points below that with the s&p down 13 on the bell michael, what do you think about this kind of dump that's now put the dow negative for the week? into the end of the year >> not much. it's one day's trade, one afternoon trade with lighter volume going into the end of the year i think you look at the year as a whole, it was positive it was driven by the optimism of better regulation, lower taxes, better economic activity, yes, but the real secret is that there were really strong corporate earnings throughout the year and that provided a solid foundation to stock prices throughout and so i -- you know, unexpected performance given the backdrop that we had. probably not what we expected going into the year, but given the way the factors were laid out, interest rates went up gradually, economic performance was good, global growth was improving and so it's a year that makes sense >> all right i don't know if this is it, folks. dow is down 115 now. what are your thoughts, chris?

>> you know, i've got to agree with both of the mikes here. it's a light trading volume week we're going to see the same a little bit next week because it's a holiday-shortened week still. things are really going to look forward to earnings season mike mentioned an important w d word, that is trend. this market has been on a trend that can't be stopped. this is the times when investors should let the trend be their friend the other part we need to remember is the market typically, when you look historically, you trade in a trading range for about 80% of the time historically and trend 20% of the time. so we're long in the -- barry james was on earlier today, he said it great, he's got his umbrellas ready. i think this is an environment you let the market continue do go but you're aware of the fact we're going to have a rollover it's healthy to have 10% at some point. i think it's going to come after earnings season. we're going to see a big reveal with how the corporate taxes are going to be affected by this new tax bill that's what haefsh everybody isg to wait for. sigh of relief, jubilation as we

see how much money is going to come from overseas i 24i6r7k you're goithink you'r people take opportunity to sell into the strength. >> let's talk about the nasdaq, outperforming the dow and s&p it in 2017 and having the most record cloeses it's had in a year bertha coombs is here to wrap things up. >> amazing year at the nasdaq topping 7,000 for the first time this month closing off of that all-time high, nonetheless, incredible year and the nasdaq actually up six years in a row the only one of the major indices that has seen that kind of trend hasn't seen anything like that since 1975 to 1980 the nasdaq 100, the big caps, that's what's really driven this, the megacap stocks up nine years in a row the nasdaq 100 has never gone up more than nine years in a row. it did so back in the 1990s. and just as then, it's really all about the big cap tech sector the big caps, the xlk spdr, it you invest in that, it was up 33% this year. and really the impetus was led

by the chip stocks up 39% with some of the real old-time names like lam research having hit new all-time highs again this year. biotech, relative laggard. small caps the real laggards here this year but among the best performers on the nasdaq this year were small cap stocks that are not so small anymore. in the biotech sector. like madrigal, that up 5,500% over the year and sangamo up 400% little typo on madrigal. 500%, kelly. >> a big typo maybe for them these things move around so much we're still trying to figure out the settle here. bertha, thank you very much. happy new year our bertha coombs. let's get a look at the big winners and losers in tech, zoom in there a little bit more this year josh lipton has a look back. josh >> kelly, let's get right to the winners. micron down for the week and month. still up about 90%

fans point to continued strong demand trends there from mobile and servers. paypal also a monster move in 2017 and same goes with nvidia tacking on another 80% bulls looking to growth in gaming and the data center to move that one even higher. tech names in the s&p 500 only really a few, a handful finishing in the year here in the red including ibm, amd, and f5 qualcomm, meanwhile, finishing 2017 basically flat. that company obviously locked in a nasty legal fight with apple tim cook's company, though, finishing the year with a gain of nearly 50%. kelly, back to you >> not too shabby. josh, thank you. we'll come book to this in a moment. we have a news alert on north korea. seema mody has the details >> reporter: kelly, it involves russia and north korea this story according to reuters, quoting sources, russian tankers have supplied fuel to north korea on at least three occasions in recent months by transferring cargos at sea

if this would be true, this would, of course, be a breach of u.n. sanctions this report goes on to say that transfers in october and november indicate that smuggling from russia to north korea has evolved to loading cargos at sea. so something that we'll have to keep an eye on the central focus has been around the relationship between north korea and china, perhaps more concentration to be put on russia and north korea kelly? >> seema, thank you. i'm looking at the reuters release, michael, which looks like it hit the wires at 3:59:05 and wonder if that's why we were all of a sudden lower into the close. >> i had the same thought. it would be somewhat ironic if the market in the last minute of trading for the year started to react to geopolitical headlines when it basically hasn't all year it would be of the type of headline, just kind of coming out of the blue in the thin market, that might have had an impact you know, the transcript of that interview with the president last night showed he was sort of fix sate fix sated on this idea of

somebody getting oil to north korea. therefore, it would have been more top of mind than otherwise. >> michael, for sure it's the number one issue when people say what are my concerns for 2018, they say i don't know about north korea of course, the relationship with russia there perhaps maybe even more unsettling to the markets. how do you interpret this? >> yeah, i mean, the geopolitical concerns are real and there's several of them that i think need to be paid attention to i would also say that, you know, more economic-related, the impact of the tax plan on corporate america and individuals, because for some individuals, their taxes are going to go up based on the lack of the s.a.l.t. deduction. i think the quickness of rising interest rates and how deep those interest rates go, you know, how quickly, how much they go up, is also going to be a factor and the interplay between rising interest rates, growing economic activity, the global growth story, and inflation, are all things that i think you need to keep an eye on going into 2018 >> chris, just staying with this news for a moment, you know, reuters is reporting that

russian tankers supplied fuel to north cree yeah tkorea, r the pt yesterday as mike reminded us, tweeted about how he was unhappy that china may also be supplying fuel to north korea. two countries, extremely important, relationship with the u.n. among other issues. what do you think the significance of this is? is. >> i think this is kind of the tip of the iceberg type of thing. we've known the geopolitical concerns are out there we've been focused on what's been going on in the markets how robust the movement's been we've kind of been able to put that aside, whether it's the middle east, what's been going on in the middle east or look at north korea. i think that's going to be a larger concern as we move into 2018 as michael mentioned, you've got the tax bill, we're going to get the big reveal and how it's going to affect everybody during the first quarter of the year. after the first quarter of the year going to have to find something else to drive markets higher otherwise we're going to get a big focus on those geopolitical concerns and let's face it, i think they've kind of been mounting. you know, it's -- you don't quantity to call it a powder keg, but obviously when you get a news -- a headline like this

right before the market closes and you get the reaction -- you get the idea that there's some tension out there that traders are waiting for something to happen >> mike, i'm looking at the dollar as well one of the few areas that might see a benefit, the flight to safety, if people are a little concerned about this being, of course, the dollar had a terrible year. positive, of course, for corporate america largely. it it's been very weak this year we were down more than half a point earlier. came off that a little bit it's hard to watch, of course, and at this hour, you know -- >> not a real profound reaction but it is something that i think it was much more about getting caught off balance the bigger case is not how much importance should be placed on this particular news item, what it might mean for some kind of action among these countries it's if the market decides that all the good news is out there on the table, and the only surprises are coming from the negative side, that's an excuse to back off a little bit >> halema krost ft is on the phe

this says on at least three occasions in recent months by transferring cargos at sea, according to two senior western european security sources and reuters says the transfers in october and november -- this was very recent -- indicate that smuggling from russia to north korea has evolved to loading cargos at sea. previously in september, those ships were sailing from russia to the homeland. what do can you think we need to be focused on here, halema >> i mean, i think there are two things the issue of, is there going to be some type of further deterioration in u.s./russian relations? potentially looking at new u.s. sanctions targeting russian officials? and then the second issue is, you know, is the trump administration going to continue to escalate sanctions and rhetoric against the north korean regime which lead to fears of some type of military action that would be bad for a whole host of markets. >> one of the sources in the story said that there was no evidence of russian state involvement in the latest

transfers, so i guess, you know, if russia denies any involvement, helima, are people going to take them at face value there? >> i mean, this would be the question of, you know, how strong is the case on russia is it going to be the case of, you know, the u.s. intelligence community, you know, the british intelligence i think it will really be a case of how strong is the evidence coming out of western intelligence sources linking russia to these type of transfers? i think also the market is spooked because it comes after reports of, you know, new stories about china supplying north korea with fuel and other, you know, goods that we are trying to prevent north korea from getting so i think it's creating a whole sense that the u.s. might be coming in tangles, multiple disputes with russia, china and north korea. >> helima, was russia one of the countries -- i thought russia, even china, both agreed to the latest tightening of sanctions in u.n. against north korea, is that right >> they did. there's always been the concern,

you know, does the chinese government, are they really, really serious about isolating north korea? same thing for the russians. i mean, there's some question of whether the russians like to have the u.s. sort of off guard on north korea because it ties the u.s. down. so both russia and china have been seen as, you know, not exactly following through on their commitments to isolate north korean regime. >> and finally, do you expect there to be any u.s. retaliation against them even if russian officials deny involvement? >> i mean, again, i think we're just going it to need to wait and see the degree of evidence that comes out on this what do we hear from the hill? is there pressure from both republicans and democrats to take additional action against russia going into 2018, i mean, the bigger story i think is going to be the trump administration i think is going to continue to escalate the rhetoric, the sanctions on north korea, creating the idea that there's a credible threat of military action i think the only way to get the chinese to rein in their client

state. i think there's going to be more concern about a confrontation in 2018. >> helima, thanks for joining u on short notice, appreciate it. >> thank you. >> chris and michael, just want a quick word with you both on 2018 before you go chris, starting with you, is this idea of possible military intervention going to cast a shadow across the markets? >> it will cast it, i think it will be temporary right now. i don't think it's going to be something that will be a lasting story throughout 2018. what i do think is it will cause a lot of people to pull back a little bit one of the things actually that was mentioned by bertha a little while ago was small caps have been leading the way it that means investors have been willing to take risk. any bull market is driven by investors willing to take that risk if we start to see small caps start to pull back a little bit here, that means the party is going to be over, at least we're going to fall back into a trading range. i think if that happens, look at 2018, a year where you're going to see a lot of rotation biotechs are going to move back up, materials and energies are

going to move back up. maybe technology lags a little bit. you have to turn into a more nimble trader and not the trading -- this trending environment that just takes all boats up in -- with the tide. >> michael, last word to you >> yeah, this year had really no volatility and i think that that condition is not going to last forever. in terms of rotation, asset classes, or individual stock sectors or whatever, i think we're going to see a lot more activity and uncertainty going into this year because there's a lot of factors in play economic, interest rates, inflation, geopolitical issues, and, you know, you can always say this is true, but we do have sort of a different set of circumstances here now you have global growth going the same way for the first time in a long time. you have global interest rates rising together. and that brings some inflationary fear there. and you have fiscal policy that's getting more pro-business at the same time that you have that so the ground is shifting a little bit going into '18, and i'm not sure where the dust falls at this point.

but it -- >> okay. >> it's not going to be like the last couple years i would say, put it that way. >> we'll see guys, thank you. happy new year. >> my pleasure happy new year. this hour of the "closing bell" is just getting started. >> the well-known banking analysts today doubling down saying it's time for goldman sachs' lloyd blankfein to go. >> you still belief that lloyd blankfein should leave. >> the stocks also getting hit today. the company blaming the new tax law. the impact on the industry at large, next. plus, republican insider larry kudlow on the first big thing the trump administration will try to do in the new year don't forget, we want to hear from you. reach "closing bell" on twitter, facebook or shoot us an e-mail closingbell@cnbc.com this is the "closing bell" on cnbc first in business worldwide. it's what this country is made of. but right now,

our bond is fraying. how do we get back to "us"? the y fills the gaps. and bridges our divides. donate to your local y today. because where there's a y, there's an us.

welcome back goldman sachs is blaming the tax bill for a $5 billion charge that it says will negate fourth-quarter earnings. sounds bad our next guest says things are looking pretty good for the banks including goldman in 2018. anton joins us, president and cio at mendon capital advisers

first of all, what do you make of their news about this charge? >> i mean, if anybody's been watching the space, we knew a bunch of these charges were going to be coming particularly in the big banks. particularly in the banks that had trouble during the crisis like citi that had some losses so this really isn't a surprise. you know, net-net, the tax plan is a positive for all of the big banks. in both earnings, roa, r.o.e. go up, economic growth, loan demand should go up and in theory, a bustling economy ought to lead to more underwriting -- >> earlier today on "fast money," melissa lee spoke about the sudden bullish outlook on goldman even though he still thinks, we'll see if it's time for the ceo, lloyd blankfein, to leave. listen. >> you still believe that lloyd blankfein should leave that has not changed >> no, that hasn't changed in any way, shape or form. >> okay. >> look, goldman sachs' earnings are down from where they were ten years ago. down from where they were five years ago. down from where they were a year ago. down from where they were last

quarter. and to assume that someone who's leading a company that has that type of record should be given all sorts of accolades, i think, is a mistake >> so anton, do you agree with him about goldman's specific struggles here >> well, i mean, i think if you think about this industry, particularly the broker dealers, i mean, they've really had a challenge, those have had to become banks and be subject, you know, to dodd/frank. i mean, goldman has made a fortune over many decades, you know, making, you know, markets taking positions and they're not doing that today. and i think that lessening some of those reins will help them. i think some will be lessened. the question is do they want to stay a bank? that's the strategy thing. i don't think you can pin that on the ceo bad time to be in this business on a relative basis. >> i wonder what else might actually happen in terms of impact on the industry, both good and potentially maybe unintended on the bad side longer term. for all these banks having more

capital to work with, at this point in the cycle, credit being where it is, all the rest. >> i think the credit cycle gets staved off the tax bill creates economic growth and prosperity. if we get an infrastructure bill, who knows. maybe we can get more. the credit cycle has been pushed out a while. haul th all this capital hopefully can be lent. clearly returning it to -- the stakeholders, not just the shareholde shareholders you've seen all these raises and special bonuses happening at a lot of big banks that's very stimulative as well, sharing with the employees. >> does that give the big banks more of an advantage going into next year relative -- we talked about some of the regional pl playepla players you like in the past does it change that at all >> no, i don't think it does at all. i think, unfortunately, for the big banks, neither republicans or democrats like them very much and they've been easy punching bags and, you know, they actually perform better than the small banks this year. i look at next year. i think the small banks performed much better because they don't have that political,

you know, headwind facing them i think political headwind faces the large banks. i'm not sure wells fargo is done with its ledline headlines eith unfortunately. i favor the small banks. i think m&a -- there will be bigger deals next year than there were this year i think all the regulatory changes that have happened at the head of the big agencies really make deals easier to happen the cfpb is not slowing things down right now for anybody so, you know, it should be a pretty good year for small banks. economic growth, rates rising, less regulation. economic prosperity. >> coming up roses. >> it's a good place to be in the banking industry >> yeah. more and bigger mergers is the thing. it's been a very conspicuous absence this whole cycle that will be interesting to see if it does kick in. >> we've seen 4% to 5% of the industry sell each of the last four years but they're not making headlines because they're smaller transactions we benefit from some of those things we can't talk about them on cnbc because they're a billion dollar

market cap there will be bigger deals this time because the regulatory burden of that under $250 billion will be lessened so we'll see formations of new super regionals. >> we look forward to some merger mondays. >> absolutely. >> in the banking space. >> anton, happy new year. >> happy new year, always a pleasure. marco rubio was a key vote in getting the tax bill passed in the senate but now he's saying congress might have gone too far for corporate america. we're going to see what larry kudlow, a main backer of that plan, thinks about rubio's comments next. excuse me, are you aware of what's happening right now?

we're facing 20 billion security events every day. ddos campaigns, ransomware, malware attacks... actually, we just handled all the priority threats. you did that? we did that. really. we analyzed millions of articles and reports. we can identify threats 50% faster. you can do that? we can do that. then do that. can we do that? we can do that. can we do that?

when this bell rings... ...it starts a chain reaction... ...that's heard throughout the connected business world. at&t network security helps protect business, from the largest financial markets to the smallest transactions, by sensing cyber-attacks in near real time and automatically deploying countermeasures. keeping the world of business connected and protected. that's the power of and. [vo] progress is an unstoppable force. the season of audi sales event is here. audi will cover your first month's lease payment on select models during the season of audi sales event.

welcome back it's time for a cnbc news update with contessa brewer. >> hi there, kelly, here's what's happening right now a 3-year-old playing with a stove is believed to be the cause of an apartment fire in the bronx that killed 12 people including four children. this is the deadliest fire in new york city in 25 years. this is the man who caught apple, actually he's a teenager. 17-year-old tyler barney from tennessee known as techfire online he's the first to figure out that apple was slowing down older phones apple, of course, has since apologized. if you have money sitting in your flexible spending account, listen up, you can only carry over $500 into the next year rest is use it or lose it. the fsastore.com is a website that will help you spend it on approved products. do not lose it how about some news you can use here advice on how to prevent a hangover from no less in authority than the mayo clinic the advice, eat before and while

you are drinking okay don't have more than one drink per hour and drink plenty of water. but there's only one way to guarantee you went ring in the new year with a headache don't drink at all that's the cnbc news update at this hour. wah, wah, wah. >> that's the way to go. going drink free, going on the fsa website. it's going it be a blast. >> you should use that nothing like seeing money wasted by not -- >> thank you, contessa, happy new year >> you, too. >> contessa brewer. here's the way we finished the day on wall street it was a dramatic close. modest declines we saw on the session suddenly turned into larger ones. dow down 118 on the bell that takes it out of its 20% gain territory for the year. >> yes. >> toward 19%. the dow lost its 5,000 point tally. the nasdaq down 46 russell down 14. we don't know about the reports of russian fuel making its way to north korea which hit at the very end of the trading day had

something to do with that. >>. meanwhile senator marco rubio saying in an interview with the florida paper the tax bill may have gone too far in benefiting corporations. ylan mui is in washington with the latest. >> kelly, he had tough words for the republican tax plan less than two weeks after he voted for it rubio said if he were king, the bill would have looked completely different and probably, quote, went too far in helping those corporations he also argued that many companies would just buy back stocks or increase dividends and that's not going to generate dramatic economic growth n now, remember, rubio pushed for a 22% corporate rate to help with the child credit and making it fully refundable. what we got was a 21% rate and moderate expansion of the credit still he believes the new law is significantly better than the current tax code but rubio's critique sounds a lot like the ones from democrats. they've been calling out companies announcing major buybacks since early december. oracle, pfizer, bank of america, are a few of them.

certainly, guys, the news that netflix is hiking executive salaries by millions of dollars in response to the new tax code that isn't great optics for republicans, either. >> ylan mui in washington with the latest there that was marco rubio speaking with the local paper for more, we're joined by cnbc steen your contributor larry kudlow lar larry, welcome to you and what do you make of these comments? >> i don't understand them they're silly. they contradict what we hid two weeks ago. maybe he sees some political benefit although i don't get that, either i mean, the corporate tax cut for large and small businesses, plus the expensing, plus the repatriation, is going to deliver an investment boom president trump talked about that in "the new york times" interview. i think president is right i think rubio is wrong i think senator rubio sometimes gets very confused about tax policy that's the way i coopkind of loa that he's not a king, by the way, and he's not even president. i don't think he's going to be president. >> is it confusion, larry, or is

it positioning ahead of a, you know, we got the midterms next year, maybe he feels something in the winds that is, you know, in a way more populist more like what the president campaigned on than what was delivered here what do you think? >> well, he's not even up for re-electi re-election. he won in 2016. >> i know. like you said, he's got a long-term view in mind here. >> i suppose i don't know what it is, but i suppose. look, let me say a couple things here first of all, i think that gop is going to surprise all the experts and do very well in the midterm elections in 2018. all right? i think these polls are either bad polls or very misleading polls. i think the media s.neemedia sa plan has taken effect. the proof of the pudding will be in the eating. as i said, i think the business side and some of the individual side, but the business side is going to propel us and already started and investment boom.

the investment boom is not only a job creator, it's a wage increaser. i want to go back to an important argument the studies have shown, many studies have shown that lower corporate tax rates benefit wage earners and middle class folks by as much as 60% to 70% it doesn't get any more middle class than that. these are ordinary wage earners and everybody is going to have more business, better business, better profits, et cetera, et cetera so what senator rubio's doing, i don't get it he's just --maybe he's stirrin his own pot or maybe just had a bad day. it's hard for me to figure him. >> stay right there. let's talk apt the president for a second amid all this president trump gave an impromptu interview with "the new york times" at mar-a-lago, sat dune fown for half an hour r lunch. john harwood has more. >> it was an extraordinary interview, off the cuff, not directed by his aides. the president initiated this conversation with "new york times" reporter mike schmidt let me go over some of the highlights on policy issues first. first of all, the president

repeated and said it 16 times that there was no collusion between his campaign and russians to interfere in the 2016 elections he asserted the democrats, themselves, have said there was no collusion that, in fact, is not the case nevertheless, that was his claim. secondly, on the issue of tax reform, he said that had the democrats been willing to work with him in a more bipartisan way, that he would have taken a different stance on the state and local income tax deduction which we've heard people like governor cuomo and others complaining about for some time as a target at democratic states the problem with what the president was saying was that the entire process was set up to be done with only republican votes through the reconciliation process. there was no prospect for a big bipartisan plan. finally on health care, the president said that democrats need to come to him and make a bipartisan deal on health care why?

because he has already spurred enormous change in the health care market by eliminating the penalty for the individual mandate in the tax bill and also he said by creating new association health plans which will at least half of america may ultimately flock to. the problem is, that's not the case either because his order on association health plans hasn't even taken effect yet and i think the bottom line is even if you're a trump supporter, you would have to be disturbed by the way the president said so many things in the interview that were not true and suggested an inability to grasp his own political circumstances, his own abilities. he said he was the greatest public policy expert of every president in american history. said he had done things that ronald reagan couldn't do. i think even larry kudlow might think that's going a little too far. >> larry, what do you think? >> well, look, i don't agree with john on a lot of this first of all, regarding russian

collusion, some of the leading democrats have not found that. they're looking for -- they're looking for misstatements or lies they're not looking for trump and colluding. his staff may be another thing we don't know that regarding trump's grasp of policy, you know, i think he's very underrated on that. that's all i'll say. i've been in a room with lihim whole bunch of times for quite some time. he knows stuff he studied stuff he listens very carefully. on the bipartisan thing, look, if the democrats had wanted to sit down at the table in early 2017, there were plenty of opportunities. including on health care, i might add. i mean, as someone who was involved in the tax discussions as one of those who put it together, but as the thing evolved over the course of this past year, successfully, there were times when the democrats sounded like they wanted to play and then they pulled back. so i just -- i just think that -- look, what the

president's saying here is, he's willing to do business first, he says, you know, i -- i have to do business with republicans because democrats didn't show up second, he says, look, on health care, on infrastructure, on trade, perhaps, on daca and immigration, he -- the door's open for democratic participation and bipartisanship he's not opposed to that look, he is a former democrat, okay so there's nothing in it for him and, therefore, i think -- i'll just put this out there, next year, 2018, marco rubio notwithstanding, i think it's going to be a great republican year, principally, principally, because the economy is going to continue to improve with jobs and wages. that's what i think the deciding factor is. >> john, would you give the president the, you know, sort of the point that if a couple of democrats, he called out joe manchin among others specifically, had said to him, look, we may get onboard if you

give us -- if it had been more of a new york, you know, schumer type, said get rid of s.a.l.t., corporate rate at 23%, you have me, would that have been the kind of outcome both the marco rubios of the world and democrats could have been quite pleased with >> wow wouuld have had to have entirely different process not just one thing here or there. democrats stated some conditions early in the process for their participation. one of them was that it be revenue neutral, which was something that the administration and republican leaders had claimed that they were going to produce, although they ultimately did not. and the second was that it would not provide disproportionate benefits for people at the top of the spectrum which is also something the white house and the administration claimed it was not going to do. but they were not willing to agr agree to those conditions and, in fact, came through with a bill that was so at odds with

what democrats believe that there wasn't really any prospect for a bipartisan overlap. >> all right again, with respect, i got to push back here. >> two words two words. >> hang on a second. come on. i want to make these points. the budget resolutions were done through order. committee meetings and committee votes, okay? they were close votes if i was not mistaken, in the senate, it was one vote, may have been almost that close in the house second part, deficit neutrality is more important than revenue neutrality, again, i believe based on the supply-side model that we're going to produce more gdp and that's going to increase revenues and cut deficits and this business about helping the rich is just democratic -- an old democrat saw, okay the thurm numbnumbers are showie joint tax committee numbers showed, in fact, the biggest beneficiaries by far of this tax bill in the next ten years are the middle income and lower middle income people. >> that's not true, larry. >> it is true. i can show you the joint committee on taxation numbers.

the -- everybody gets a cut. >> the greatest cut in effective rates is for people at the top >> well, i don't know what you mean by effective rates. i'm looking at marginal rates. >> look at their table. >> well, i'll have to -- i'll send you the committee use of the table because they show clearly, as did, by the way, most models, the democratic criticism on this whole business is when they try to create a case that in the next ten years, the middle class is going to lose all its -- all of its tax cuts because it's not permanent, now that's a long time from now. in ten years, you and i can come back and assess that situation, but the facts are -- >> you're going to be assessing it ten years from now, how about ten minutes from now ten days from now. >> the corporate tax cut helps the middle income the most >> thank you, both >> i hope i'm around ten years from now happy new year to everybody. john, kelly, happy new year. happy new year to the american economy. >> as well thank you, guys, both, very much larry kudlow, john harwood

coming up, biggest money mistakes celebrities told us about this year on the "closing bell." stay tuned what's team spirit wo? (cheers) what's it worth to talk to your mom? what's the value of a walk in the woods? the value of capital is to create, not just wealth, but things that matter. morgan stanley it wasn'taking ceasy at first. she learned how to better communicate her needs. and you learned how to not ignore yours. i discovered how to make healthier meals. and i discovered how much i enjoyed them. narrator: becoming a caregiver is a learning experience for everyone. find articles, tips and tools from experts and others who have been in your place. the caregiving resource center at aarp.org/caregiving.

welcome back to the "closing bell." let's get to other big stories

of the day the last trading day in 2017 and our rapid recap. >> saying today china's alibaba will be the first to $1 trillion beating out apple, microsoft, amazon, and facebook >> i think apple actually gets there first. i think alibaba's right on their heels. i think they're second i think they have a great opportunity. >> apple has issued an apology to customers following the revelation that its operating system does slow down older iphones to prevent shutdowns. >> this is planned obsolescence. as a shareholder, i want you to buy a new phone, an 8 or x that's better for me. >> goldman sachs the latest bank to take a one-off write-down thanks to the new tax bill $5 billion >> is netflix is giving top executives salary bumps for 2018 citing the new tax law as the reason the law eliminates certain surcharges on executive salaries. >> trump tweeting this morning "why is the united states post office, which is losing many billions of dollars a year, while charging amazon and others

so little to deliver their packages, making amazon richer and the post office dumber and poorer should be charging much more!" ♪ >> it's been in my head all afternoon. y d all the details in 2017 ma have a big impact on investments in the telecom sector next year. big changes are coming that's next on the "closing bell." of trading specialists? did you say yes? good, then it's time for power e*trade. the platform, price and service that gives you the edge you need. looks like we have a couple seconds left. let's do some card twirling twirling cards e*trade. the original place to invest online.

the moment a fish is pulled out from the water, it's a race against time. and keeping it in the right conditions is the best way to get that fish to your plate safely. bacteria can multiply to high enough levels that even cooking it will not destroy all of them. it's definitely the most important thing in my business. how fresh is the fish? where it comes from? how it gets here. the more i know, the better. sometimes the product arrives and the cold chain has been interrupted, and we need to be able to identify where in the cold chain that occurred. we took our world class network and we developed devices to track environmental conditions. this device allows people to understand what's happening not only with the location of that asset, but also if it's too hot,

if it's too cold, if it's been dropped... it's completely unique. we ship fish, beef, poultry, vaccines, insulin. this is about monitoring and protecting everything we ship. i catch all this amazing, beautiful fish and then once it's out of my hands, i have no control over what happens to it. if you have a sensor that can keep track of your product, it keeps everybody kind of honest that way. it's really all about the network. you are looking at trillions of transactions a year. not too many companies in the world can even scale to that type of volume. who knew a tiny sensor could help keep the food chain safe? food has to be fresh. it's that simple.

it's time now for our "takeaway. the final "takeaway" of 2017 there's a media theme today. we begin with tivo spiking today on a report from the street that private equity buyers are looking at taking it private the buyers reportedly offered just over $20 a share. and while tivo spiked nearly 12% today, it's still trading below 16 bucks a share now it started the year around 21, mike, so it has been on a slide. does this company make sense to take private >> you know, obviously the market is giving it some credence when you have a report about the interest and up more than 10% so, i think you have to give it some kind of legitimacy as a potential idea the lbo math doesn't seem to work that great right now, in terms of how t trades relative to cash flow, but some kind of deal i'm sure could be worked out. i think it makes sense also on the idea that tivo has an interesting place in the whole streaming world. >> is susure. >> kind of as a utility or tool. in software to help people figure things out including cable systems who want to go over the top. >> i wonder if it will be a communication service. we're going to talk about that in a second. >> might be too small in general

for the s&p. >> for the s&p fair enough. is it a bust or isn't it netflix has been panned over its will smith movie, "bright" which garnered a terrible critics rating on rotten tomatoes and prompted one to call it the worst movie of 2017. but nielsen says it drew 11 million viewers in its first three days netflix doesn't acknowledge that, but still let's call 11 million viewers, mike, first three days, let's say $12 a ticket if it was a movie, that's $132 million in theoretical box office revenue which isn't bad the audience score on rotten to m tomatoes is 88%. >> it's a miss i guarantee it got hate watching or people who have inertia and when netflix puts it basically right out front every time you log into the app, you're going to get a certain number of people watching. it surprises me, it would be almost 20% of domestic netflix subscribers. >> that's a big number. >> that actually did watch it if niels nielsen's numbers are correct. really what that does is point out the difference between clicking on something on netflix

and spending $so f10 for it. people are spending less than $10 for a month of netflix. >> the movie did cost $100 million to make. if it was a lot cheaper you'd say, okay. it shows the power of the netflix platform again, maybe it's not so crumbfy. if the audience liked and again, maybe it's not so crutchy -- crummy if the audience liked it >> i don't know if audience meta ratings are what you want to go by it says something about will smith's ability to draw a little bit of a crowd >> he still can. finally, keep an eye out because coming in january we could get the names of the companies that will be added to that new communications services sector of the s&p 500. the idea is to combine companies across telecom, which is a tiny three-company sector, combine telecom with media and entertainment. the revamp is coming next september. the question, mike, is who are the specific names will faang now be under one roof and how do you expect traders to

position -- >> it's going to thing that faang will be under that roof because amazon may be that one that doesn't really fit in terms of pure communications services. a lot of this stuff is judgment calls. it's not so much that it's clear-cut. i do think it makes sense to do this to get rid of this orphan telecom sector and to acknowledge that there's a lot of bleeding over the industry lines here >> people will be gaming this out here, especially with passive investing being so important. whenever a celebrity joins us here on closing bell, we ask what their biggest money mistake has been 2017's best answers are coming up also coming up on "fast money," a top technician betting on a big breakout for one sector sector you can find out at 5:00 jj, will you break it down for this gentleman? hey, ian. you know, at td ameritrade, we can walk you through your options trades step by step until you're comfortable. i could be up for that. that's taking options tradall s.

hey guys, wanna play some pool? eh, i'm not really a pool guy. what's the hesitation? it's just complicated. step-by-step options trading support from td ameritrade feel that? that's the beat of global markets, the rhythm of the world. but to us, it's the pace of tomorrow. with ingenuity, technologies, and markets expertise we create the possible. and when you do that, you don't chase the pace of tomorrow. you set it. nasdaq. rewrite tomorrow.

from matthew mcconaughey to robert de niro, some major celebrities joined us on "closing bell" this year some of their major money mistakes, next whoooo.

i enjoy the fresher things in life. fresh towels. fresh soaps. and of course, tripadvisor's freshest, lowest... ...prices. so if you're anything like me... ...you'll want to check tripadvisor. we now instantly compare prices... ...from over 200 booking sites... ...to find you the lowest price... ...on the hotel you want. go on, try something fresh. tripadvisor. the latest reviews. the lowest prices. so that's the idea. what do you think? hate to play devil's advocate but... i kind of feel like it's a game changer. i wouldn't go that far. are you there? he's probably on mute. yeah... gary won't like it. why? because he's gary. (phone ringing) what? keep going! yeah... (laughs) (voice on phone) it's not millennial enough. there are a lot of ways to say no. thank you so much. thank you!

so we're doing it. yes! "we got a yes!" start saying yes to your company's best ideas. let us help with money and know-how, so you can get business done. american express open. you myour joints...thing for your heart... or your digestion... so why wouldn't you take something for the most important part of you... your brain. with an ingredient originally found in jellyfish, prevagen is now the number one selling brain health supplement in drug stores nationwide. prevagen. the name to remember.

those celebrities, they're just like us in 2017, we found out their biggest money mistakes from the likes of robert de niro, matthew ma kcconaughey, sean white, and more >> biggest money mistake joe montana ever made. what comes to mind >> i invested early on in a company that unfortunately we found the hard way had two sets of books oops >> i did learn early that when someone wants you to loan them money, most of the times you're giving them money. >> my mistake? man. the lamborghini didn't have a real good resale value after a while. >> i hired the wrong guy when i started off. i hypodermired the wrong guy from "mandy" through to

"copacabana," i didn't see anything and i didn't know it in my manager gary keith came along and said, you know, you've only got $11,000 in the bank. >> i've been conned by someone who was a really great person, i liked him, but they took money from the situation >> we had put a little money together and went all in in this development in wachack waco, te right when the market crashed. we bought it in '09 and put all the eggs in one basket, come 2010, and the market fell apart. >> i made a couple of shopping sprees i probably shouldn't have gone on. >> in 2020, everything is unavoidable. we love the idea of the never quit, never give up. >> pretty wide variety of

answers there. any stick out to you >> one theme is be careful who you trust, be mindful of the person who is offering to help i actually like matthew mcconaughey's line, when someone asks for a loan, most likely you're giving it to them >> my dad told me that a long time ago, probably when he was giving me a loan it's interesting how many people regret the frivolous purchases they make. whether it was a lamborghini or shopping sprees. you get the sense -- >> with the benefit of hindsight, that was a very fleeting kind of bit of pleasure and of course you also known alternative uses, how much it could have built up to >> we can keep this in mind when we talk about the year's best ipo performers when you get that money, you have to be careful what you do with it. a couple of these are really

small. anapt anaptysbio roku, 115% >> i feel like with roku, canada goose, the skepticism was out there in those deals and they've surprised to the upside, bomth o them >> then there's blue apron, we've talked about that enough that does it for "closing bell." "fast money" starts right now. >> live from the nasdaq market site overlooking new york city's times square tonight on "fast," the shorts are piling in on some of the biggest tech names in the market are these high fliers in trouble? plus the worst, the first? energy has been lagging all year about the chart master satisfits about to take off. so-called vice stocks have been surging but if history is any indication, it may be time to cal