running, in fact we're about at whether it's a reset or pivot or this is just sort of new year, new trump situation at the white the highs of the day pete house, where the president is we've had unusual activity with the financials the you know what i'm seeing as well signals open any xlf. xlf, financials, they're going up giddyap. we'll see you seen, stef that does it for us. >> i heard he scoffed going "power lunch" starts now. i'm michelle caruso-cabrera. there. >> anti-dovos man is dead, at here's what's on the "power lunch" menu. your portfolio is power to new least here at the white house. highs today president trump s. >> steve bannon was the leader of -- here inside the white wearing in on the wall and infrastructure plan, and a rare break, trump is headed to davos to attend the world economic forum, even though members of his team said that davos -- and house. bannon has been gone from the white house for a while, but his unintended consequences for teen in their socialized world.

"power lunch" tarts right now. intellectual leadership has been in the has here. >> he's looking for ideas that >> good day, welcome everybody your money just keeps on growing, the dow, the s&p, the nasdaq record highs yet again. day after day, the s&p and nasdaq have not ended on a down day. work. so far this year bob pisani is at the nyse small-cap stocks also joining with the staggering stats and look at what is at stake for what will be a very big earning the party today at least same goes on for transports, up about a third of a percent season >> you would think it was time for a pause, and six straight up the ten-year spiking well above days we have some amazing statistics. at the close yesterday but wait a minute, it's going to be even better we'll get you the numbers in a

2.5% that is the highest left for few moments. >> with the winning. crude since early may of three ec, thanks, robert, my old years ago, 2015. producer for those stats i'm concerned about really high expect ache. the numbers are way up there, so people are expecting big things to happen. just on earns. fewer cuts in the earnings brian? >> thanks, tyler president trump spoke moments how about the guidance ago about immigration reform a big issue here a lot of people were expecting eamon javers has more. more to raise guidance >> reporter: this was an unusual they race it and two thirds event for a number of reasons, including the fact that the president was flanked by lower. how about the other things out democrats. republicans also in the room there? key staffers in the room how about buy backs? we saw the president saying he thanks to the tax cuts, people agrees with dick durbin. here's the moment just a few and investorer are expect been more buyback here's one thing that works me,

moments ago at the white house. i'm very reliant on the people in this room, and what i approve will very much on what the people in this room come to me tyler. with they come to things i'm note in love with, i'm going to do it, because i respect them. jack is here, with -- and barry >> signaling some flexibility there, say he wants to do a daca deal first, and then move on to comprehensive immigration reform the president also announcing as you were pointing out that he as going to democratic avos this bannister, you know last year by year, the ultimate symbol of contrast funds had the world economic gobblism. he campaigned on and "value" in it did less well. >> i think it's a great point, tyler, the shirt -- keep in mind

large-cap stocks are attract ink as to investors who don't see much earnings growth no matter what happens in order for investors to become value names and industrials, ar materials, and rover all three of those financials, materials, energy, all are expecting double-digit growth. i think it was a three-year note yields are now at the high -- in auction, highest level since 2007 >> we're seeing central banks

scale back their that inflection moment, while everyone is focused on earnings, we're focusing on the discount rate. >> because of rising interest rates? yeah, it's kind of a switch point, a temper tantrum globally. as you radio he flectst flect on the yields, that's why we expect it to be a bit of a shock.

it's competition, are you worried about that being what pushes the market lower at some point? >> eventually. i think fair value right ats this point is 4.1% that is nominal gdp. that is the rate it had been tracking all along in fact, if you look at the earnings yield, which is just the reciprocal of the -- it is about 1.35 to 1.6% higher than the triple b bond yield. however, i don't see any real competition for equities under rates are probably 1% higher than they are today. so if the ten-year treasury was 3.5, i would worry, but because we're still at 2.5, i think we

have room to run >> very quickly, oil, we just flashed hitting 63, highest level since december 2014. will higher oil prices scuttle the rally or help it? >> i believe the fed will step in to defend it. i think you'll sigh the oil market top out the speculative shorts have left the market what you'll see is oil top out. >> it's going to be a much more interesting year in the markets this year, gentlemen jack, barry, thank you very much thank you. >> it's a lot to talk through. >> i say that knowing that,

right. shares of target are up 35% in the past six months, moving higher today after reporting strong sales for the holiday season courtney reagan joins us with more. >> hi there, michel. target is the first of the big box retailers, increasing 3.4%, far above the flat to 2% growth guidance that target gave us shares are up about 4% today in reaction back in november it dropped based on that guidance it turned out to be a bit conservative and upping that full-year guidance, and that's both because of the stronger than expected sales that it experienced in november and december, and the tax benefits that's about six to eight cents. you look at the math, it's really the sales that's the bigger beneficiary to the full

year targt says its stores fulfilled 70% of digital sales both shipping from store and picking up in store, all categories, including food and beverage saw comp sales improved. gulls the full-year guidance is far above ammist consensus to 325 stores, opening 30 of the new smaller format stores, those ended up being keyed nodes for faster distribution to shopper and give them one more option to get you your package brian, back over to you. >> courtney, thank you very much a new ace letter three-year notes are up for auction. before we get to how they did, big gross of jan us anderson saying in a dwight, bond bear market confirmed today

25-year long-term trendlines broken in five and ten-year maturity treasuries. bill on the record calling it. 25 years of bull out, the bear is in. do you agree >> what would trigger for people to make that statement for me it happened a little earlier based on patterns, the double bomb at 135, 136 both in 2012 and 2016, or the short end of the curve signaling much of this much earlier. bill mentioned that, i believe, but it doesn't matter how you arrive you want to go to on your gps, the only thing that matters is the statement for all practice purposes is very hard to argue with so my congrats to bill gross, and my congrats to the three-year note yields today

a hard day to buy them yields obviously moved higher, so the yield at this auction, 2.08 was really aggressive a the pricing, the highest yield at an auction since may of '07 to think that on a day where we're seeing all these bearish sentiments pushing rates up, i gave it an a-minus the directs at 11.5 were off the charts, best since july 2016 no matter how you slice it, i think this is a great way to kicks off 56 billion in in reply on a day when we're putting a tombstone on the bull market for treasuries. >> if this is true, wow, this is quite a moment the debate over iphones with kids is raging on. apple responding now, as we just

hard from the "halftime report", the activists putting pressure on apple we'll have much more coming up north korea and south korea holding talks datoy. is there a reason to be hopeful? "power lunch" will be right back

a major development in

sports do. north korea says they will send athletes and others to south korea south korea for the olympics next month. what does it mean? gordon chang is the author of "nuclear showdown, north korea takes on the world." welcome to "power lunch. >> thanks, michel. >> is this a big deal or not >> it is a big deal. the south koreans will pay all the expenses for in north korea delegation to the winter olympics next month. every dollar that seoul pays to the kim regime is one more dollar that the regime has to launch missile, detonate news and engage -- >> so you think this is a bad development? >> well, paying for it is a bad development. i would love to see the north koreans at the winter olympics, but i want them to pay for their own delegation, but there's a very good things about this. there will be

military-to-military talks the united states needs to instill a sense of deterrence to the north koreans. we won't be at those talks, but the south koreans are. they're our ally they can tell theno north korean they had to stop it wild talks. >> is this a sign of success of the united states foreign policy >> in part kim jong-un mentioned that sanctions were hurting the regime he even called them an existentialthreat. that's the indication that the u.n. sanctions and and that's consistent with anecdotal evidence we have buzz where trump can't take credit is what north korea is doing comes out of the kim playbook which is seven decades

old, that's that the north doesn't talk to south korea, then makes a dramatic overture, then makes concessions and finally throwing a tantrum we're in stage three of the four stages we have seen this before >> is there the possibility here that north korea playing its own inside game is trying to drive a wedge between the united states and south korea? the friendlier they are with south korea, the more it might stay the u.s.'s hand >> oh, absolutely. almost everybody north korea does is determined to actually drive that wedge so this certainly is we saw that from the north korean statement, which said the missiles thatnoic has are not aimed at south korea, only the united states. the chinese are egging on the and engage in this outreach. so, you know, we know that both

the chinese and the north koreans are out to no good. >> gordon, thanks so much. >> thank you. in the first year of the trump administration, more cars were emperored to the u.s. from mexico than ever before. how did that happen? plus alabama celebrating, and i mean it was a thrilling victory over georgia last night. i watched it to the bitter end is espn celebrating a ratings winner in those numbers are coming up on "power lunch.

more cars were built in mexico and exported to the united states in 2017 than ever before, this even as president trump has promised to reverse that trend phil lebeau explaining how did that happen, phil? >> it happened because the automaker says until nafta changes, we won't slow down production, nor should they. that's where the models of set up 2.33 million vehicles were built in mexico and shipped up to the u.s. last year, an increase of almost 10% yes, that is an all-time high, in temples of the big three here are the exports through november this is worldwide, not just to the u.s., though the majority of these went to the u.s. you see an increase for -- that

could say down 19.5% they were down, because they build cars and cars are not in demand right now in terms of overall exports. not all of those go to the u.s., but 75% of them do come to the u.s. we reached out and general motors said, look, our plants that also build the chef,silverado and gmc sierra in the u.s. are running at capacity there's greater demand for the vehicles, as well as the suvs. we're going to keep building and selling them year not going to leave sales on the table just because it's built in mexico. it will be interesting to see what happens with the north american free trade agreement doerkz, kayla tausche has been covering this. if they alter that agreement, what happens with demand for

those vehicles, especially trucks and suvs. that would have a huge impact at the dealerships. >> it certainly will phil lebeau, thank you very much interesting story. >> you bet. this is the issue that everybody in america seems to be arguing b. lo you our producers in the newsroom, but in a nice way, are apple, google and app makers responsible for kids ease addictions to their phones we'll continue the debate. yono dbtu ou have an opinion on it, when "power lunch" rolls on.

hello, everybody i'm sue herera here's what's happening at this hour in washington house speaker paul ryan telling reporters -- any resolution to the status of young, undocumented immigrants known as d.r.e.a.m.ers must include stricter border enforcement. >> while we deal with this daca issue, and we agree with that, we want to make sure we have the right kind of interior and border enforcement, so we don't have another daca problem down the road. five people have been killed

in mudslides from the first significant winter storm of the season in california the storms brought heavy rain causing mudslides from wildfire-carred hillsides. evacuations were ordered for about 700 homes in burn areas of l.a. county. prince harry and meghan markle attracting cheering crowds they gathered to watch them arrive for an appearance at a youth-oriented radio station it was the first public event of the new year. that's the news update this hour back to you. >> thank you very much. >> the money rally just rolls right on, at least no stocks the dow is up another 140 points boeing leading something else to watch. bond yields are also surging the ten-year spiking to its highest yield since mid-march.

p.s., watch mortgage rates as well oil here in america at $63-plus, the first time it's been above $63 since all way back in december of 2013 however, everybody is getting bullish on oil talking to people in the industry, reading industry notes, availability of workers in the permian, and thes cost of those workers. not enough, you have to pay them more to get them in the fields that's not the only field where that's happening it's happening in construction, happening in lots of areas where there are labor shortages. >> it's not a bad problem to have that means higher wages. >> and that might mean higher interest rates, which we are seeing today, which is the big question >> could that mean five rate hikes this year? >> or a sell-off of the stock market, if you see the ten-year

rise. >> there's just a lot more good moving parts for us to chew over all year anyway, apple responding to pressure that it needs to address the problem of young people who have become, quote, addicted to their phones just a short time ago on "fast money" halftime, we heard from the people applies that pressure calstrs and jana partners. josh >> apple is a socially responsible company, but on this issue it could be doing more that was the message from a shareholders today, in an inclusive interview. on. >> there's no question that we need to be more responsive to children's needs and children's activities and there's lots of research that has indicated that excessive usage of smartphones

is damaging to kids. >> but some have asked why go after apple when teens are spending so much time on yout e youtube, facebook, video games charles penner arguing that apple is a natural place to start. >> they are the gateway to a lot of these more problematic apps and sites. it's like a hose, if you can squeeze the hose you're not going to focus on every drop in water, and apple is incredibly powerfully positioned to do that. >> and weighing in, calling this issue a potential risk for shareholders. >> teachers in the classroom see the impact that these students are suffering, and having as a result of these iphones and other telephones, and other devices, so it resonated with calstrs. >> apple formally responding to these shareholders says --

effectively anything a child could download or access online can be easily blocked or restricted by a parent apple saying new features and enhancements are planned for the future guys, back to you. >> let 'stay on the story. you folks have many strong opinions, most of them around the idea of parental responsibility, make sure yew kid isn't doing the wrong thing. we hear you, but many of these app are being used in ways never intended to be used. jimmy, the fact fact you are the proud father of seven children seven. >> i would love to know what your cell phone bill is every month. that aside, you understand this wave i made the comment we were in

the first inning of this discussion, most people basically tweeted said mind your own business, and parents should mind their own kids. do you agree there is going to be a growing backlash? or will it fade away like a neil young song >> if you are going to look at history, you would say it will fade away. we've always had these panics about new technologies, radio, television, internet panics about, you know, rock music lyrics, so occasionally they come from time to time, but these technologies don't go away, why? because they're amazingly useful, and people just like them so i think it is a weird panic that even thor you're dismissive of the idea that parents need to do more, sure, parents need to do more. we need to educate kids on how to mind their time, but beyond that, i mean what is the alternative, brian do you want to ban these phones

from kids? some people might. >> no, i don't think so. i think there was a big misconception. most people seem to say, hey, parents control your kids. don't disagree with that one single bit but the reality, though, is you can't control other people's kids if you look at some of the cyber-bully constituents, the numbers are stunning witnessed outride bullying 80% of teens, 52% of young people report being cyber-bullied. half of kids out there -- it used tore when we were kids, tyler, something bullied you, they had to do it to your face and risked getting a punch in the nose you know what i mean now can you cyber-bully kids, often anonymously. there is some control aspect here that we need, isn't there >> listen, should companies make

it easier -- >> why do we need disappearing photographs? how about that let's start there. unless you're an east german spy, what good is that >> i'm not going to question their business model, and i think time will tell whether these are sustainable products or models. you're trying to pick this one example or that one company, when i think a lot of people are using it very politically conveniently to go after a sector, which they probably also don't like maybe it's because i'm in washington, so i immediately try to think about what else is going on here, and i don't think there's any coincidence that we received a lot of these stories that people are more worried about generally about the power of technology companies. >> i'm allied with brian on that why do we need disappearing photos and why do we had knneed cheetos

>> hey, don't get personal. >> what do you do your children? >> my younge son doesn't have a smartphone or iphone, but we have lots of controls so i can monitor what sites he goes to, but for the older kids, the teenagers, i talk to them and ask them to use their good sense. i don't have any limits or tracking devices on their phones. >> where are you on the idea of looking at their texts do you insist you be able to -- >> theory receiptically i have that power i don't find that i've ever had to do that or ever had a concern where i felt like i needed to do that, but there's a basic understanding when push comes to shove, yeah, i can do that. >> you mentioned, jimmy, the issues they face, all of these companies face in washington

tell us what you're hearing and what the risks are it struck me yesterday when we were having one of these discussions, that we were talking about phone addiction as if it were like a smoking addiction. i mean, that just raises a whole level of threat against these excretes that i'm not sure they were aware was coming. >> yeah. so the -- 2017 is starting off great for tech companies, we've gone from the fake news and russia meddling, and we've moved on to this addiction, maybe pun debts like using that word, but actual doctors don't use that word, so we have to be careful. i think there's a very minimum of headline risk for these companies. the movement could look very hard at the role of big companies are playing in our country that's not going away.

that will be a daily, weekly battle i think like forever. >> i don't disagree, jimmy it's a conversation, which is very personal. there are -- there are stats out there around teen depression, the cyberbullying stuff, at least it marnts a good conversation. >> i think absolutely, but let's not pretend that teenagers and adults obsessing he over things, that the not new we like to pretend that each of these is new and amazing it's not the first time we've seen thinks problems. >> what were you saying? i was checking a text -- >> you're do shtick, great >> we'll have you back thank you. we put out a poll on

twitter. 28% said yeah, it's a risk, but 72% said no, it's the parents' job. >> bullied on the bus when i was little my mother said hit them. >> that's how i got these ears trust me you can't do that through a phone. >> i know. >> we're not advocating punching somebody, but there were times when it worked. >> a lot of us have twitter feeds. the social media world emboldens family to saying things they would not say to your face sometimes when i've ever gotten an e-mail or something like that, the most disarming thing you can do is pick up the phone and speak to that individual most of the time they take a different posture. >> they're mortified and%ed. >> listen, i'm sorry about that e-mail, tyler, okay? >> oh, that was you, was it? all right.

moves on to another hot topic, lack of women in technology. why are there so few women speaking at ces? plus an ugly day for e.l.f. beauty jim cramer is about to grill the ceo. ceo. next here on "power lunch. managing portfolio risk and liquidity and generating income. that's real etf innovation. flexshares. built by investors, for investors. before investing consider the fund's investment objectives, risks, charges and expenses. go to flexshares.com for a prospectus containing this information. read it carefully.

when it might be time to buy or sell? with fidelity's real-time analytics, you'll get clear, actionable alerts about potential investment opportunities in real time. fidelity. open an account today. a new episode is tonight and absentee owners hope think can get a lifeline from marcus. >> the company is on life support. i know that. >> how far do you think you are away from closing. >> if some things don't turn around, within a month or two. >> can you make payroll next

week >> not yet. >> i have the road job that's why i reached out it's time where we need to turn the ship around. the numbers suck. >> the margins suck, and your employees think you guys suck. all right. see more of it, "the profit" tonight 10:00 right here. >> marcus always saying it like it is. the human electronics show in vegas and very few women among the key speakers julia boorstin, she's definitely key. >> reporter: hello the consumer technology association came under fire for not booking a single keynote female speaker the cta responding by adding photos of women on panels to its keynote page features nancy

debuik and kristin dylan the cta defended the -- the speaker most head a large entity we feel your pain, it bothers us too. the tech industry and every industry must do better. >> hog hog hereweare on twitter sta stage. >> hulu announcing this morning some significant growth, 17 million subscribers between the on-demand service and streaming bundle launched last year, up 40% that's good news for disney in particular as it gets control

of hewletti. bob iger will expand and built it into a real rival for netflix. yulia, alabama beating georgia in overtime. a thrilling national title game. so how were the early ratings for the game >> reporter: espn released preliminary numbers. they indicate a big jump in the college football ratings, the overtime win were up 9% from a year-ago game. when they were watching on the flagship network, it drew 16 ratings, the second high school most wafd play offgame in the four seasons we've had that format final numbers not until this afternoon, but this paints a different story from the nfl those ratings were down about 10% from the prior year, which is the second year the nfl wild card games were

down 13% from last year. that doesn't mean people are less interested in other pro sports in fact the nba is having a strong season with its ratings up by double-digit percentages back over to you. >> julia, thank you very much. ugly day for e.l.f. beauty, the stock tanking double digits. "mad money's" jim cramer is about to grill the company's ceo next on "power lunch." he's ready, he's armed, he's dangerous. the hottest place o, harness the energy from the sun to develop popcorn. we thought we had the right equipment, we quickly realized we needed more. le 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.

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share of elf is taking a hit today. joining us now is jim cramer, hi jim. >> thank you, tyler. lets get this right. you did change your long-term. you did some shading, why? >> first of all, we are excited to tell people that we are

expecting in 2017, 17% sales growth and over 60% ef growth. our growth would be 10% or 15% from net sales still, pretty incredible growth relatively overall category. >> you bring up relative to your category >> what the heck happen to your category how did mass beauty sales weaken >> it is if you look over the last couple of decades the great thing of mass color cosmetics is it has consistent growth it comes roaring back. what we are foindiinding is put great rates up and so it was plus three and it went down to minus three and that's what everybody wanted to talk about we decided to get off the noise

off the table and we'll do 17% in 2017, lets talk 10% or 15% which regardless of where the category is. we feel confident of being able to deliver and focus on the fundamentals which is utah is all about consumers. >> one of the things haltom cths happening is you do anything to your guidance that's negative. what i see is more square footage in ulta and target at 30%. all of which you can get more square footage as the years go on >> that's right. >> target rewarded us with more than 50% more space and walmart with more than 20% more space and we are particularly excited of the full change role of ulta. what we find with all customers is they love elf we bring new users in to their category and incremental sales

and high productivity and as well as items, we are one of the leading categories >> i think you got sustainable growth this is affordable >> that's right. >> not a lot of companies are in that sweet spot of being fashion forward but i love this term >> in fact, our average unit retail prices around $3.50 we have mass prices but the quality that you expect in a prestige product >> there was a belief that you can do this 20% consistent which is very, very hard to do what would take it so that you could say that the dry spell in your category is over. what does it mean of consumers more money, what turns things around for you >> well, i think as i mentioned the category is historically

been strong. there is a couple of years where skin care was down and everyone us worried >> and even este lauder were worried. >> yes, that's why there is a come back. >> as our category gets stronger, one of the things that drives our business is new products our consumers, our makeup enthusist loves it we have the glrow on the glow selfie light you take this and put it on your iphone and it has three different lighting level and you can take a selfie. you and i can take one later >> my 23-year-old will not know if i bring it home >> you will know >> so chairman ceo of elf.

the stock is down, it could be a bargain. >> jim, thank you very much, we appreciate it. just days away from the end of the first year of the trump's presidency a lot of distractions. the agenda rolls on. what is ahead in year number two? it is already taken place. valea valea valeant pharma is up we'll talk to the company's ceo, the second hour of "power lunch" starts right after this.

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with the right financial advisor, life can be brilliant. yet all the noise in washington does not seem to be stopping the trump's agenda. what is next on the presidential's docket. amazon is just getting started when it comes to taking a bigger share of your retail dollars is here the right medicine, after some years where survivors were

questioned valeant pharma is coming back. "power lunch" of the second hour begins now ♪ there is the king of soul right there. welcome to "power lunch," i am tyler mathisen the dow is up 155 points the s&p 500 is up 11 and a nasdaq is a third of a percent all at lifetime highs right now. that's their lifetime, not my lifetime it is pretty old, too. >> markets rallying and bonds are falling. the yield is at the highest level since march 17th of last year oil is up as well. leading the dow today, boeing, johnson&johnson and target and

acuity under armour among the worst s&p 500 performer and biotech. on pace now for its best day that's since early december. michelle >> tyler, i am michelle caruso-cabrera >> intel hardware patch coming, it can leave hackers taking protected information from operating systems. 2017, the costly, total cost associated with the weather reached $306 billion jeff bezos well hitting $105,180,000,000 passing bill gates record so far this year 2018 >> wow >> well, we begin in washington. the president finishing a lengthy open meeting with democrats and republicans.

the topic is i am mitigation the event was opened to camera and also seemed to be away for the administration to blunt criticism of michael wolff's new book that the president is unfit and unstable >> eamon javers. >> reporter: that's right, what better way to open the event for the media and the world seeing the president running an immigration meeting for over an hour in control of the issue and the meeting. the president hosting a bicameral. this is a president who ran of the hardest hard liner on immigration to the right as much of the republican field, beat the democratic candidates and came to office on a promise to build the wall he says he wants to do something on comprehensive immigration reform here is the president a little earlier at the white house

>> i think after we dakoo daca, believe we should be successful. >> this is the president negotiated with democrats over immigration reform in realtime with republicans in the room the world is watching and camera in the room for the entire meeting. republicans and democrats are not expecting to negotiate in live national television the president sending a message that he's open to a change of directions signaling in the room that he would be up to whatever solution, lawmakers proposed in that room would be fine with him. a big change for the president here on immigration, the approach to it, the tone on it and a big change here in terms of globalization the president announcing earlier today that he's going to davos this year, that's the globalist event with the financial leader

across the world that the president welcomes opportunities with world leaders they're saying this year's world economic forum, the president is going toengage in a number of ish including promoting american business and industries and workers. we'll see how the america first president approaches the glob globalized elite in davos. a fascinating turning point here early in 2018 for this trump's presidency >> back to you >> that's a fascinating turn of events eamon, thank you so much >> what will year two of mr. trump's presidency look like, a democratic from new jersey and our larry kudlow good to have you both here >> thank you for having me >> we had a fun conversation with larry here, we are glad to have you back. >> hi, how are you, larry?

>> my favorite democrat and you said everybody is going to have one. >> you are my favorite former. one of the things that's on the table is a proposal that you and others come up with to address the voter pain, i guess that you see arising from the in ability of many people in your district to deduct the full amount of their state and local taxes and property taxes and you got a novel idea under which states would give, you would pay some of your tax as a charitable donation do you think that really would stand up in court or in congress well, i am going to get to that >> one as you pointed out, i heard this from republicans and democrats in my district when i was home is that wait a minute, our taxes are going up

suddenly, we are not able to deduct our property taxes and being on a cap of $10,000 and seriously gutted on our property values is going down what are we going to do about it we came up with a tax cut plan which people would be able to give a charitable contributions to tleer talenheir talents and moneymone municipalities just today we had eight law profess professor. >> larry >> i know some lawyers are saying this, the irs have said something different and it is been held up in court. i am ink-jet to read up on it, i am not an expert you cannot make the contribution, i am talking about a charitable contribution solely

for financial gains. that's one point you cannot make a so called charitable contribution to the state. that's a second point. it has to be to a private charity, that's a third point. finally, you have to be able to prove it california's excellence funds. that's the monologue there, come on, do you think folks want to give the state of california their money? do you think this is a tax dodge for wealthy people >> i do. >> south carolina and alabama are two states that does this. i will send you all the sites on this the irs backing and there is court casing on this mostly red states use this you are right, it can be a direct contribution in exchange for property taxes the municipality and the irs ruled on this. the municipality is allowed to give you a tax credit for contributing to them

you are allowed to do that and they can give you a tax credit for what you want on this. >> josh, what's the municipality is going to do on the money? >> well, they use it -- they're going to give you a tax credit back on your bill from them and then they'll give the general fund for other things. >> that does not pass the irs test >> it does i know it seems crazy. >> go to a private charity >> i know we are friends but i will show you the sites on that. i know people think that but that's actually not true you do not have to go to a private charity. >> my favorite democrat will have to get together offline on this what would charitable donations that you cannot get anything in return in value. >> lets set off a case in municipality and i will show it to you

that's normally true when you go to an event. in a case of the municipality, the irs ruled on this. 22 states, alabama and california and mostly red states usually. >> can i ask one more point on the tax. >> sure, then i want to get to daca, immigration. >> i believe we are scheduled for lunch. >> i am ready. >> try and donate it >> new jersey has a personal income tax of essentially 9% and they still try to get a tax on millionaires new jersey has a corporate tax rate of 9% my suggestion is fight for lower state income taxes i mean that's the key. you know it is --

>> tyler jump in as well >> the population of new jersey have grown in 7% new jersey's budget has grown 23%. i don't need to tell any of us driving to work that the roads are not paid with gold and the trains are being pulled by donkeys. where are the money going? >> pensions. >> we got to look at our expenditures and get those under control. larry, you and i are on the same page of cutting taxes. why not claw back the dollars. i am for looking for every single way to get those dollars back and cut our taxes >> all right, josh >> these are the topics. new jersey, on tax on millionaires, these are the people, the top people are the ones that you try to help to avoid the salt tax >> i don't want them to leave our state. >> well, okay, david tepper, ma smartest hedge funds he leaves a 12% hole for income

tax. if you lower the tax rate, there is something close to the median, you will have people coming to new jersey. >> i grew up in new jersey >> can i clarify one point, it is not just offering income. a cop and a teacher, their tax is going up $3,500 >> there is poi >> the point is cutting taxes. >> i agree 100%. >> i am going to worry for the state. >> what do you think >> i am going to get there the president making what sounds like what's often in the early inning is conciliatory comments of getting some deals on daca and immigration. what do you expect >> i think we are going to get there. i have not listened to the whole yet, my understanding is we got to do something to make sure the 800,000 dreamers are not thrown out of the country in march and there is going to be border security there is a deal to be had and we

have to keep on working until we get there. you just made the point. we have to sit down and talk to each other half democrats and half caucus >> the president wants a wall. >> every expert is saying the same thing building a giant concrete wall won't help security. >> that's not my point, the president wants a wall >> you got a wall from san diego through arizona. in some cases, you don't need a wall essentially, you want some barriers trump wants barriers some cases you can put up a fence or a wall, you can have drones or rudy giuliani suggested using stats and putting the place of law enforcement. daca, i agree with you, trump does not -- as far as i know, trump does not want the dreamers to leave but what he does want, josh, he wants to change the law

with respect to legal immigrants from this crazy, you know, family chain business to a merit system where for haven sakes, you all speak english. that should be a bipartisan yes. >> he's talking about comprehensive and immigration reform which we have been through. i am glad that he opens that up so we can get it done. you are talking about security here in exchange making sure that dreamers are not around the country. security, there is a lot of definition making sure we have the right security i am the pifirst one. of course, now we got to get in the details of it and that's where things break apart i think we are there will the democrats come to the table? i am just asking this is a good faith question to you. will the democrats come to negotiation table and immigration and dreamers >> there are 22 of us that spends 50 hours on the end of

last year and sitting at the table with republicans we are ready and eager less keep it going i think this is an opportunity >> i will take that as a yes >> as a yes and larry we'll talk more about it at lunch >> good, josh. >> try to deduct it. >> pretty good >> yeah. all right. >> get k bating back to the mars here bonn yields arising with a ten year yield you can see the dow of 140 points and nasdaq is higher by 18 lets bring in our steve, another day and triple gain for the dow, it does not seem to stop >> if you look at small business optimism and hedge funds that trails, the averages are removing their hedges and going

forward and all of that is bu bullish. it is hard to get in front of this bullish train because you have too many things going i favor right now. >> what about a question of rising interest rates when you hear bill gross say the bond of the bull market is over, what it means is yield and they're going to go up at some point we are starting to see it. at what point did interest rates threaten the rally >> well, we have not seen that as of yet. i think the regulatory environment easy as well as the tax policy changing as left a lot of unknowns or uncertainties in the market that complicated over interest rates. will it not happen no, i think eventually you will start to see interest rates cly colliding with the stock market. you have to go a lot higher from here a lot of this, rising rates

today is from the fomc talking about price targeting and there is a bunch of things going on, central banks across the world concerning efforts and not buying bonds anymore is very hard with no one buying bonds and the competition is becoming equities and if you look at a long-term charts, rates can rise much higher before there is any competitions for equities. >> thank you, steve grasso the one exception, wing stop, our own jim cramer sits down with the ceo and asking how his company is making chicken great again. valeant resurges and the company is making a come back. we'll talk to the ceo mr. joe

papa and exercise equipment going beyond the fight, with el ta we'll take you on a ride, on "power lunch." i realize that ah, that $100k is not exactly a fortune. well, a 103 yeah, 103. well, let me ask you guys. how long did it take you two to save that? a long time. then it's a fortune. well, i'm sure you talk to people all the time who think $100k is just pocket change. right now we're just talking to you. i told you we had a fortune. yes, you did. getting closer to your investment goals starts with a conversation. schedule a complimentary goal planning session today.

. for 2017 was a tough year for chicken restaurants. they were hit with one-two punch

of chicken wing stop is up 50%. how did they do it >> our own jim cramer sits down with the ceo, he joins us now with wing stop's ceo, charles morrison hey jim. >> thank you, michelle charlie, nfl divisional playoffs, championship super bowl, is this your sweet spot? >> this is the time of the year and everybody loves chicken win wings. it is the number one product that's consumed for the super bowl now we are ready and excited and looking for a great months ahead. >> you had a remarkable stock because it is a remarkable company. dominos went from 10 to 200. you got similar possibility because you have the model and talk about what you have done? >> well, we have an asset-like

model. just this last year, we implemented a regular dividend for shareholders and about every five to six quarters, we return in the form of special dividend, we noticed the first half of 2018, we are poised to do that with our levels being down three or four times. >> you have ambitious, the top ten worldwide restaurant, tell me why you think you can pull it off and talk about how quickly you double units already >> yeah, in six years i have been here, we have certainly doubled more than the size of the chain. we start to build emerging national business. we cleared our 100 restaurants at the end of last year, 106 total. that's just scratching the surface. chicken wings is the most consumed protein in the entire world. we are looking for markets that

we can grow that 12 markets that we signed, we can grow as many as a thousand restaurants quickly. we believe the balance of our u.s. growth which is potential of 2500 stores can be equal in the international space arriving at the top ten global restaurants. >> you have a great restaurant >> it creates a much more efficient restaurant operating environment. they arrive tomake line and ready to go. those orders come in with almost $5 higher average check. >> lets talk about profit and franchise, a lot of people worried of your stock when chicken wings soared >> 2017 was a great test for the resilience of this brand record high wing prices

sustained until september. that causes a lot of pressure. we built a simple and efficient model, most of our business are carry out and our asset is 1700 square feet so it is a low investment and labor cost and low rent, that helps us absorb that 2018, wing prieces have come don dramatically by the way, 2018 has been fantastic. a friend of mine, okay, tell that guy i want to franchise and it is not so easy. it would not be a franchisee >> they're the ones that help us bill to where we are n so they bring the infrastructure

to the table to help us grow into the new market as we move on >> these are the people who are season and trying to get labor the government is making it tougher for immigrants we cannot do it without legal immigrants these are people that want to work and work hard >> what's does legislation meant and washington for you >> we are well positioned for this we have a lot of restaurants in the south and south western part of the country access to employees is critical for us legislation is a concern but we have a very small roster in our restaurants. our turnover is very low we provide our employees to work and have the kind of quality work experience that most people would desire another chain for us, we have been able to weather that well. we certainly are watching it carefully but not a major concern. you and your chains have been

winners. charlie morrison, chairman and ceo of wingstop. back to you guys >> cool stuff, thank you, jim. >> amazon retail domination is just getting started that's one analyst says, raising his target to yeah, 1400 a share. we'll join him to talk about it. make his case and the four big calls that you need to know about. it is called "stetre talk. it is coming up on "power lunch.

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first stock is kohl's. this is after the retailer raised its 2017 earnings holiday sales of 7%. that's the best department holiday sales consistent from both november and december women's apparel is moving in a positive territory for the first time all year. your second stock is

evercore although note that 54% of its revenue is tied to one company qualcomm is something to watch otherwise, the same call, ubs is up to a neutral to a sale. >> third stock, big call, especially given the first time. cost control, capital management and also evaluated price starts at 73 bucks and currently at $62.45. >> tylenol stock, ormat, $72

target however, that's a good thing because its got high barrebarre. the growth path was high upside. the price starts at ormat is 10% upside >> all right, valeant is up 60% so what is next for the pharma company in wll te'alk to the ceo, joe papa, straight ahead on "power lunch." room. your privacy makes you my number 1 place to go number 2.

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hello everyone, i am sue herrera. here is your cnbc news update. christopher ray addressing the cyber security conference in new york saying it is imperative law enforcement agencies and tech companies work together to strike a balance for privacy and security >> let me be clear that the fbi supports information security, we support strong encryption information security programs need to be thoughtfully designed so they don't under mind the

lawful tool that is we need to keep this country safe >> 85-year-old joe arpaio, arizona sheriff received a pardon from president trump says he's running for the senate. he's seeking for the republican nomination for the seat vacated by senator jeff flake. kodak is getting into cryptocurrency market. >> kodak shares responding by 35% on the news. >> you are up to date, michelle, back to you. >> rally mode again. s&p 500 is higher than a little

7. setting new high is russell 2,000. the dow trans por sport is highr the oil market is set to close for the day, jackie deangelis, did i see a $63 >> you did >> my gosh >> we had a 2% move higher today. yes, we got over $63, it was the highest since december of 2014 inventories, we got our report coming out tomorrow expecting more than $3 million a barrel. that's the report of it. stores level in cushioning are falling. new records indicating there will be an increase in demand. it is a perfect storm to take us higher, more reasons to go up right now. sessions low 31.80

valeant is paying down debt and shaking up its management. investors seem to like the changes. the stock is up more than 50% over the past year, 55 if you want to be counted >> meg tirell is with joe papa >> thank you for having us >> thank you for being here. >> but, you also are facing a lot of exclusive number of major products jp morgan pointed out, it could affect your revenues more than $7 billion this year and how are you continuing to drive mobility and growth >> when i started was 18 months ago, it was all about putting together a plan for multiple years, what we said is we have to come out new innovation, we have been fortunate to do that and offset declines, we were fortunate and received an

approve for really what we think is or seven fabulous products that we think today represents less than $100 million opportunity, if all these products get approved, we think it is going to be over a billion dollars opportunity, we call them the significant seven that's the way we'll be able to over come some of the issues >> well one of the things i think you tried to change about valeant and it is reputation from being a price goucher at the same time you did take a number of 90% price increases and a dozen drugs last week. are you dependant on that price increase to glrow. >> we said patient access in pricing committee, it is all about first and foremost making

sure that products were available for patients and of course, we had to look at what were the pricing going to be for our product. i remind you, when we take a pricing of whatever percentage is, we realize only half of that because of the different rebates and etc. we think that we take for nine products of our full range portfolio, we take an appropriate response to what we need to do with pricing. >> you should expect to see similar pricing increase from valeant along those lines. >> all right, joe, unfortunately, i am running out of time but thank you very much for being here with us >> pleasure, thank you, ma'am. >> guys, we got more coming up at the jp morgan healthcare. >> looking of valeant, that stock given tim seymour a commanding league. mr. wonderful and the ladies

taking over flash crash gordon >> make sure to tune in the results for the show on february 5th, that's the day after the super bowl tim seymour is way in the lead there because of valeant >> just take one, does anybody want to see seymour win? >> i am calling you out seymour. >> all right, amazon, new fresh, all time highs today there is a lot more room to one there is a lot more room to one as one analyst it predictedt's refreshing. will tell us whyks like. tomorrow is important, but she's only seven once.

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to improve short-term memory. prevagen. the name to remember. amazon hitting an all time record high today. piper jaffray boosting their amazon price target. that's about 15% upside. joining us now with the cnbc news line is the analyst behind that call, mike olson. it makes jeff bezos worth about

$15 billion? >> unbelievable. >> what's behind your call >> so we did a survey of 1,000 u.s. internet users, we found usage for amazon for holiday shopping was lower than many thinks there is a significant portion of u.s. internet users allocate a huge amount of spending in amazon so when you couple that with a low of overall amount to spend as a result of holiday retail, only about 4% that amazon accounts for both offline and

online >> that was not enough percentage of our upon -- our survey was a little bit -- yes, low to mid single digits of overall holiday spend in the u.s. allocated to amazon it is most penetrated market of the united states. that's what we think is remarkable and there is still a lot of room to go here >> here is my only beef with amazon we highlight it as an asset life company. they're online they're billing gigantic warehouses a company that has more if not retail space but more physical space than most quote, physical retailers at this point.

>> that's a good point, it is reasonable argument. we use a comp group as most analysts in internet companies, it is going to be much more heavy than those companies but try to account for that, what we do is assign on multiples on discounts of what we see what we saw companies with similar growth rate to amazon typically trading in 20 or 30 times. we try to base that into some degre degrees. >> michael, it is a pleasure to get you on $1,400 price target. thank you. pelloton unveiling their bikes. we'll show you what it is in the

next two-minutes

the company peloton is unveiling new bikes. >> for the last four years, peloton is all about this. home cycle and live streaming content. they are unveiling a high-tech treadmill hoping to take the brand to the next level.

>> it looks like a screen only ginormous. a company doubled its annual revenue last year to $400 million >> the bell is made of 59 individual slacks. >> it is a $4,000 high-tech live interactivecushy. >> treadmill market five times bigger than the bike market. members, we asked them what they would want, boot camp style circuit training workout, whereas full body, would be a nice complement to the peloton bike. >> i'm paying $4,000 for the treadmill part then you're saying i can get off of it, but i can do this at home for free. >> sure. sure you could. by the way, if you have your own treadmill, you can consume our content via our ios app. >> cadence resistance and output. >> reporter: ceo john foley says peloton was never just about the bike, in fact, the treadmill was

in development barely two years after the company launched all part of a strategic plan that includes new apparel, new accessories and more products ahead. >> we don't want the peloton bike or treadmill to be the hero it's more about the consumer as the hero their lifestyle, all the things that matter to them. >> reporter: and foley says the treadmill will not be the last piece of equipment that peloton will launch, to be determined. they say they're going to focus on marketing now and expanding internationally to new studios back to you guys. >> diana, i've never seen an exercise fad i didn't like $4,000 for a treadmill is a lot of money he mentioned there's an app you can use instead? how much does that cost, do you get a revenue beat from that every month? >> reporter: they're about the media, $39 a month is what you're paying for the content. do that on your ipad if you don't want to buy the apparatus. people do that on their own home bikes as well but when you pay the treadmill, you don't have to

pay any more if you're a peloton rider. this is a $it 2,000 cycle and sold a lot so, you know, treadmills are expensive, $4,000 is a hefty price tag, but it's kind of cool. >> it really is kind of the ultimate razor and razor blade model, in other words, you pay for the equipment then you fay for a subscription as well di, thanks. >> reporter: yeah, that's where they make their money is continuing that subscription and the more apparatus they have, the more people they're going to be buying into that subscription foley has always said peloton is a media company, not fessly lnel a fitness company. >> interesting thanks, di all right. time now your ft trading nation," today, why not, let's talk about the markets s&p seeing its strongest start to the year since 1987 the nasdaq seeing its best start to a year in more than a decade. the question now, of course, is everybody way too bullish? jina sanchez chad morganlander with washington crossing advisers chad, there was a stat out from

lpl financial that this is the 16th time in the first five days of the year the s&p has risen more than 2% the other times it's done that, markets "a," always ended higher, "b" with an average gain of 18% bullishness, hedging highs record lows. are you nervous? kind of makes me nervous. >> from a valuation perspective, i would be somewhat cautious, but when it comes to the nasdaq, for example, we think you're going to continue to see higher highs based off a strong global growth inflation that's really quite low, central banks that are not aggressive on a hawkish stand. and as well, strong earnings growth, for example, on the nasdaq, you have revenue growth expectations for 2018 of over 9% earnings growth of over 14%. but nonetheless, this is a short-sided market call that i'm making for q1 based off of all the tailwinds behind you one thing to, though, be concerned about is valuation so when you look at growth over

value, we used to be overweight growth, no longer, now we're flattened out at that position and we're actually neutral from the perspective of growth over value. >> okay. jina, by the way, almost every one of those years where we gained a lot, 18% on average, there was a significant pullback at some time in the year in fact, 1987 was one of those years. i don't need to remind you what happened then. when are we going to get any kind of a significant pullback, probably a healthy one, too, in this market? >> look, brian, you have to take this and put it in a long context. this is the third stage of a very long bull run that we've been in. the first stage was immediately after the crisis where everybody cut -- cut people's jobs, right, so you cut your ownings down and that made you look profitable. then you have this prolonged buyback cycle. now we're in the part of the partly finally startinging to see earnings growth, revenue growth. it's taken us years to get here, however, this probably will sustain for a little while you have to recognize from a

valuation perspective, we are at levels we haven't seen since the dotcoms and that's important we are at the high elf valuations we've seen in a very long time. now, that doesn't mean we can't stay here for some time. i think as long as earnings continue tole come in and sales continue to come in, that will support that i don't see this -- this could happen all year, so, you know, we're in for a little longer >> okay. in for a little bit olonger thank you. something to watch for more trading nation" go to our website, tradingnation.cnbc.com "check please" is next. >> now the latest from tradingnation.cnbc.com and a word from our sponsor. >> a good first step of any risk management strategy is to determine the amount you're willing to risk on any given trade. some traders use the 2% rule where they try and limit their loss on any given position to no more than othr ta2%f eitol trading capital.

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however, he was followed shortly afterward by chuck schumer, senate minor te leity leader sae believes daca must be a part of any government spending bill so despite the bipartisan discussion that was under way at the white house earlier today, republicans and democrats still are not on the same page on how to move forward on immigration, and on a bill to keep the government open past january 19th, guys back o'ver to you. >> is that the drop dead date for lack after of a better phrase here? >> reporter: that is a drop dead date for keeping the government open daca recipient s begin to lose their status on march the 5th. >> got it. thanks very much, ylan it never ends in washington. >> after all the bipartisanship. >> even some conciliatory words from senator schumer who said he was struck by the positive tone that the president took in this meeting. words that you don't typically hear associated with democrats and president trump. i want to talk about nick saban because beyond the fact he is a really good football coach and

his team won the championship, i believe for the fifth time in the last nine years, i think he's a model ceo and why? because he is willing to take big bets when he needs to. couple of years ago in a championship game, when his team was losing, he did an onside kick at halftime big gamble, it paid off, they won. last night, he changed quarterbacks at halftime big gamble paid off won. that's what great ceos do. thanks for watching "power lunch. >> "closing bell" starts right now. hi, everybody. welcome to the "closing bell" on this tuesday, i'm kelly etchivaa the new york stock exchange. >> i'm bill griffeth another record day for the stock market this is my favorite stat, i don't know if you've seen this yet, for the s&p so far this year, its best start for a new year since 1987. >> i did see that. thanks to the magestical robert

hamm 1987, it's a double-edged sword. >> it is, you wonder if it's leading up to something. >> a lot happened that year. >> anyway,