does stand behind the bill, so now the house passing it, the white house behind it, it is up to the senate do its job >> all right thank you so much. give me a ticker for final trade. >> how about gilead. >> alcoa >> and i'm going long the tech sector here. >> thanks for being here that does it for us. "power lunch" starts now here is what is on the menu. president trump it willing china with $60 billion worth of tariffs raising fears about a global trade war what is at stake for america and the trade war fears are playing out on wall street stocks are dumb fwlitumbling shy and add to that the fed. which one is the biggest concern for your money mark zuckerberg finally speaking saying he is sorry for facebook's role in the data scandal and that he has taken the steps to correct the mess. but will it push advertisers away $40 billion is at stake as

"power lunch" starts right now welcome to "power lunch. we have a major market selloff the dow had plunged 500 points earlier. we're off the lows right now more half of the companies of note off more than 10% from their recent highs s&p down 38 points nasdaq down 106. facebook certainly pressuring the nasdaq today, that stock is on track for its worst week in four years trading below its 50, 100 and 200 day moving averages. and bonds are on the move. yields in the 2, 5 and 10 year notes all trading lower. >> and let's get you caught up on some of the big news of the day. president trump's lead lawyer for the special counsel investigation john dowd has resigned this coming only days after the president called for an end to

that inquiry we'll have more on that developing story just ahead. "new york times" is also reporting that restricting sales of guns by its business partners. and steve wynn has sold about a third of his stake in wynn resorts for about $180 a share he now owns about 8% of the casino operator that he founded. shares of wynn resorts down more than 2% in today's big selloff and down 6% for the week >> we begin as we often do in washington where president trump just signed new tariffs on china aimed at theft of intellectual property kayla tausche is live at the white house. >> reporter: it is the president's widest ranging trade action yet targeting some 1300 product lines currently being imported from china. the u.s. trade representative has initiated a report that it says the economic harm to the

u.s. of unfair trade practices on intellectual property is in the range of $50 billion so it plans to try to recoup some of that cost with these tariffs. the president speaking just a few moments ago said his estimates were higher. >> in particular with china, we'll be doing a section 301 trade action it could be about $60 billion. but that is really just a fraction of what we're talking about. >> reporter: here is how the process will roll out. the ustr will publish a list of the products subject to tariffs. and in 30 days, a comment window will close during that window, stakeholders, companies, can weigh in on potential impacts of these tariffs. within 6 0 days, treasury is expected to make recommendations on investment restrictions, on

chinese companies, sovereign wealth funds and other type of institutions making investments in the united states unclear exactly where the student visa restrictions fit into all of this that is something the administration was weighing as well a ustr official told reporters that china had had multiple opportunities to make its relationship with the u.s. right. in economic talks last july, the president's swris it e's visitn november and a visit by a top economic official to washington, and at no point did china offer what the president viewed as remedies that would actually fix this today peter navarro, national trade council director, said that hopefully this will result in narrowing the trade deficit with china, that he said that the $370 billion goods deficit with china currently costs the u.s. 2 million jobs. back to you. >> kayla, thank you.

those fears about a trade war fueling the selloff that we're seeing on wall street. bob pisani is at the new york stock exchange with more on the markets. >> and there is a lot of moving parts. i want to show you an intra day of the s&p 500 because once the announcements was made, kayla did it right here, 12:15 or so eastern time, market lifted off of the lows. the s&p moved about 15 points in 20 minutes and that helped. now, not completely. we're moving back down again we'll keep an eye on that. you want to watch the big global industrial machinery companies, they are proxies for the whole trade war concerns out there, they are still down. so caterpillar, bowing i go eib ingersoll rand so this is helping people, this 30 day comment period a big thing because they will hope that they can dilute it with the comments from the public, but still a big concern. the other issue, no leadership

technology stocks are giving up the leadership particularly fang names. and not just facebook. we've seen down days now for a while on google, netflix and amazon if you take a look at where the stocks were from their highs, facebook is about 15% off the highs. but we're also seeing apple and netflix offtheir highs remember, these are were the market leaders along with semiconductors but they stopped going up and that is a problem for the market nothing is taking the place of it the other problem, ten year yields this was the year it was supposed to go up, not down. we were moving down this morning at 2.8% and some of the big regional banks dropped 1.5 to 2% in 45 minutes when we saw ten year yields moving down toward 2.8% a lot of moving parts down here. >> that is for sure. thank you. and let's talk about that move rick santelli is track being

yields is that a safety trade >> this could be day number 20 that ten year yields close, i'm talking close, in the 2.8, so not a 2.79, not a 2.90 and despite the volatility in the equities, we've seen yields bounce a bit because actually there was a brief penetration intra day of 2.80. so 2.79 and change it was the fifth breach of that level on intra day trade management month of march. if we look at what is going on with our relationship with europe, look at year to date chart of tens to bunds yesterday's fed meeting and today's downdraft hasn't changed the fact that we're still 230 basis points apart, within 5 of the widest since 1989. i talk about the dollar index not going below its mid point of the year, consolidating it in a similar fashion to treasury yields but if you look at the euro, it is the same there obviously as you see on this february 1

start. but i'll tell you one currency that is certainly not in the range, the yen it propelled the dollar to the lowest level as you see on this next chart since around thanksgiving november 2016 yen's strength, dollar weakness, bill and the gang, back to you >> thank you, rick markets are slisliding after pr trump slapped china with $60 billion in tariffs and a move to impose penalties for intellectual property theft. wilbur ross is joining us. the stock market down sharply today. investors are worried that you are starting a trade war are you? >> i don't think so at all i think what we're really starting is the prelude to a set of negotiations. i think the market's concern is they just don't know all the details and markets hate

uncertainty. >> so is your premise that there won't be retaliation and therefore the markets shouldn't be worried or it just won't be as bad as they think based on what you are ultimately going to do >> i think there will be some ultimate retaliation but i don't think it's going to be the end of the earth. think about it, the $60 billion figure that the president mentioned and that you quoted is a tiny fraction of our economy and a tiny fraction of the chinese economy. so it is not as though we're blowing them up. >> are you prepared though, is the administration prepared for for there to be so-called sacrificial lambs to get the trade deficit down if china decides we're not going buy as much soy beans, or sorgum, you are you willing to say that is too bad? will you say to boeing that is too bad?

if apple and intel because they have manufacturing if a sirlts in china get slaped on the wrist, do you say sorry guys how much are you willing to endure >> well, i think that it is going to be a little bit different situation from that. clearly there is a high probability that they will take in sort of action. the question is what will it be. what will be the magnitude what will be the overall impact and what will then be our reaction as you know what the president is seeking, there is 100 billion very near term reduction in the trade with china that is one of the major targets. the other major target is intellectual property rights because that is our future things like steal ael and alumi deal mainly with the president intellectual property rights deals with the future. and there is no accident that

later on this year u.s. patent office will be announcing its 10 millionth patent no country in the history of the world has anything remotely approaching 10 million patents that is a backbone of our econo economy, certainly a core of our future and that is why we must protect it >> basically you're saying to the markets that there will be some form of retaliation from china. we just don't know the extent of it >> and we have to accept it, the price to achieve what you want >> quelwell, you can't make pros without a bit of a risk. that was the spirit of the tax law the president got through. naysayers said you will never get a big tax reduction. they were wrong. the naysayers are now saying that it will be the end of

global trade about that they will be wrong again. this will end up being a negotiation. there may be some firing shots over the bow and things like that, but i believe at the end of the day this will end up in a negotiated settlement. >> speaking of the tax bill, fed chair jay powell yesterday during his news conference said that the fomc during their meetings this week talked about trade policy, their concerns about the impact the tariffs would have on the u.s. economy isn't it clear that they're saying -- they are sending the signal to the administration that trade policy is at odds with what the fed is trying to do and what the impact of the tax cuts were going to do on the economy? >> i don't think so at all to the degree you're talking when the steel and aluminum, which is oupdslike you in part a are, a fraction of a penny on

the cost of a can of beer- -- >> but the bigger picture. let's face it, tariffs are not a growth strategy for an economy, are they >> no, the question isn't are tariffs as such a growth strategy the real question is can we continue to afford these mammoth trade deficits that are sucking money out of our country a lot of the money that is being used for other purposes is money that came from us in the form of trade deficits these are not sustainable things so we have no alternative but 20 t to try to deal with the trade deficit and the president is going to do so and it is not just20 to try to deal with the trade deficit and the president is going to do so and it is not just0 to try to deal with the trade deficit and the president is going to do so and it is not just to try to deal with the trade deficit and the president is going to do so and it is not just by these tariffs. we instituted 15% more counter duty and anti-dumping investigations in the last year

than the prior administration did. you have to enforce the rules. and while these other countries speak about free trade, they are actually the most protectionist people and we are the least protectionist and the most free trade of any of the major countries. we need a more reciprocal relationship and i believe the actions that the president is taking ultimately will end up with a more reciprocal relationship >> define a win then what is winning? when china starts doing or stops doing what do these tariffs end? >> well, as you heard from the conference today, there is an obvious problem with the theft of intellectual property there is an obvious problem with forced partnerships that result in forced technology transfers those are inappropriate.

they are not part of free trade. they are not part of fair trade. and they are not tolerable >> so that is a win, the win is if china basically goes back on every single protectionist policy that they have had in place to date when it comes to allowing u.s. companies to compete in their country that is a big ask for a win. >> we'll see what they respond to what i was giving you was the direction in which we'll be heading. the specific details of it will have to be worked out. but directionally, we must protect our intellectual property that is our future >> mr. secretary, as you well know, you imposed the tariffs on aluminum and steel for national security purposes among other things but today you probably heard the chinese trade official said that under wto rules, our tariffs

don't qualify because -- or they violate the rules because the steel and aluminum industries don't qualify under national security, using your definition. have you heard from the wto officials at all on this and what do you say to the chinese officials? >> well, we obviously disagree with the chinese officials we have thoroughly vetted the 232s with white house counsel, with department of justice, with department of commerce counsel, with ustr counsel we believe that it is not by any means appropriate for some other country to try to tell the united states of america what constitutes our national security and our enabling legislation under section 232 of the 1962 act makes it clear that it is not just directly against related, it has many other

factors to it relating to the overall economy. so we don't need other countries telling us how to define our national security. economic security is national security and without economic security, there is no national security. >> caterpillar, boeing both off by more than 3% on fears that there will be retaliation from china. have you consulted with the ceos of the major industrials and talked to them about these issues what have you head to them, what have they said to you? >> we've had thousands of pages of written testimony and probably hundreds of hours of conversation with those various parties. there are a couple things though that i think one needs to focus on one is the relative 3r0e portion proportion of the actions and

the others we've taken this is not going to put china into a depression. not going to put us into a depression this is simply trying to cure abuses the president and president xi have a very good working relationship with each other particularly on north korea. and we're not going to try to disrupt that relationship. but everybody even our closest allies must play by the rules. we do a better job playing by the rules in an a very large number of other countries. everybody must play by the rules. >> it is interesting that you say that tariffs won't put either country in a depression but there is a long way between where we are right now and a depression that could cause a lot of pain for a lot of americans out there, whether they are average americans, consumers just going to the grocery store and paying higher

price or investors in the stock market goldman sachs had an interesting note out, basically they said the administration is really implementing tariffs and letting it be a politically driven cycle as opposed to an economically driven cycle which that t. had been historically. when the economy is weaker, that is when you look to exact these gains from engaging in a trade war. as we know now, the economy is quite strong what is what all the data tells us that is what the fed and administration is telling us so why are we doing this right now, why is it that right now when all of the ceos out there like fedex say there is a major global expansion under way, but i'm worried that a trade war is going to dent those benefits of tax reform why now? >> i think you have to judge this administration by the results it actually achieves, not by somebody's hypothetical

concerns about what might be the consequences many of the same naysayers about the president's trade actions were naysayers that the economy could never grow more than 2%. well, guess what it is. these same naysayers said the president would never get a big tax bill through and he did and the same naysayers that are now saying the sky is falling because of tariffs, they will be proven wrong again >> tell us a little bit more about the process within the white house. has larry kudlow been involved in these discussions, is he on board with these moves >> larry kudlow is not yet a formal part of the administration, but he is well apprised of what we've beenct ld dinner at my house with me and a bunch of other folks last night. >> and is he on board with this move today >> you'd have to ask him but i believe that he is not yet in the administration simply

because of the paperwork that is required he well understands our policy and he wouldn't have taken the job just to be a thorn in the president's side he and the president go back a long ways. larry was one of the early people supporting the president as was i and we all know each other pretty well. and while we may disagree on specific issues, overall the president's policies are the president's policies and it is our job to implement them. >> and we have all known each other for a very long time here, mr. secretary. so i'm going to push back one more time and ask is larry kudlow on board with these tariffs? >> i mean you had begdinner wit the guy last night what were you talking about, the weather? what did he say? >> you should ask larry if you want to. but it is not me to paraphrase him. as you well know from his years

in tv journalism, he is a very articulate spokesperson of his own views and i think he fully understands the strategy of negotiation in trade >> so before we let you go, let's be clear about this and get a bottom line here what do you tell investors and what do you tell ceos across this country are we going to have a trade war or will the administration make sure that we do not enter into a trade war? >> trade war is a matter of definition you could argue that there has been a trade war under way for decades. the only difference is that we had been relatively defenseless in it. so it is really a matter of definition i do not believe that there is anything we're doing that materially undermines any of the other programs of the president. in fact, i believe the end

result will be an enhancement of it there may be some bumps along the way, and there are bumps along the way with the tax legislation, there are bumps along the way with everything, but this is not going to be blowing up the world or anything cataclysmic. >> mr. secretary, we know you're a big cnbc watcher maybe you've been busy lately, but over the last several day, we have been covering the situation with facebook and whether or not they have adequately controlled their users' data. as commerce secretary, are you looking at the situation with facebook in any way? >> well, we are in the sense that commerce department administers the privacy shield which is the arrangement between the european commission and the united states. and then a separate one between switzerland and the united states i'm happy to report that we have over 2700 companies have signed up for the privacy shield with

europe and there are another 1500 companies that have signed up for the privacy shield between the u.s. and switzerl d switzerland. we are very, very actively trying to protect people's right to privacy and to the appropriate protection of their personal data. i'm not into the intimate details of what happened in facebook i'm sure those will be brought out in excruciating detail in the coming days. >> but do you believe there is more regulation necessary for companies like facebook? >> let's first find out what the actual facts are, what actually happened let's see. i think there is too much of a rush to judgment on things in general. that is not to say that i don't think there is any culpability on the part of facebook. but i think that we need to understand what is going on, how did it happen and how do we deal

with it going forward. i think preventing further outbreaks of it is really the key. >> mr. secretary, thank you so much for joining us on this important day when it comes to trade. >> thank you very much for having me on >> i did have one more question. what did they have for dinner? what did they serve? >> did they invite tyler >> he is in d.c. too right now we're still tracking the big selloff on wall street we have seen the markets down as much as a500 points mark zuckerberg, president trump or jay powell? which is having the biggest impact the answer next. we took legendary... and made it liberating. we took safe... and made it daring.

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and these kids, and these guys, him, ah. oh hello. that lady, these houses! yes, yes and yes. and don't forget about them. uh huh, sure. still yes! xfinity delivers gig speed to more homes than anyone. now you can get it, too. welcome to the party. welcome back big selloff on wall street -- >> come on >> big selloff today the dow plunging more than 500 points for a time. we're off the lows right now all flee major averages breaking below key technical levels so who is pummeling your portfolio? is it mark zuckerberg and facebook is it president trump sparking fears of a global trade war? or is it fed chair jay powell

sho spooking the markets with his rather hawkish comments during the news conversation yesterday. to weigh in, art hogan and lees erickson good to see you both if you ask enough people, you will get all three eventually named. who do you -- what is going on with the market today do you think? >> i think it is okay to have an opinion that they all take part, but the person least likely to be jamesed is jay powell he did a great job of messaging. he did a great job in answering questions. i think there is a reason you see trump in the center of that graphic because i think that is what we're concerned about and should be concerned about the most so stepping away from china for a minute and thinking about just renegotiating nafta, if we can't get that renegotiated, that takes 50 points out of gdp growth this year so trade is important for a

while. obviously we just saw secretary ross talking about the fact that this is probably more negotiating than it is necessarily a hammer, but it feels like a hammer right now and that can turn into something much larger. >> i wondered if when he talked about that at the beginning and said this is just a negotiating tactic, is that why we maybe saw the market come off -- lift by almost 100 points. did that assuage some of your concerns at least he acknowledged they don't want a big trade war >> i'd rather hear him say that we're wrong about the way we measure trade deficits but we won't get there, so i'd feel we are if this is the art of the deal. we're thinking about starting with our strongest hand and hope that we meet somewhere in the middle i think that is the best case scenario no one will say in a china is a fair and free trader, but no one will say a trade war is good economic policy. >> lisa, do we pick one of those three or is the market looking for an excuse to selloff anyway?

>> i really do think it is a combination of all three while it would be nice to point to one specifically as the key driver, really i think they are all contributing factors if you look at us coming in for 2018, basically it is an environment where the market being up nicely, somewhat elevated valuations. and while we had a good backdrop for earnings both on a top down and bottom up basis, there are a number of these concerns floating and what you've seen is that some of these fears are being heightened and so the market is reacting to they sam. i would agree with art that while the fed was a bit hawkish yesterday, there was a nice reaction in terms of the announcement and how that was phrased. and there was a cautiousness while they upgraded the assessments overall they only raised their projections moderately so i think what you are seeing on that inflation and fed front is really some reaction just to the fact that there is an

explicit recognition that the economy is stronger. and so that is going to provide a more difficult context for the environment going forward with investing. on the trade wars, i think it is very similar while there is definitely a lot of fears going on, what actually is going to happen really depends on the details of what goes forward and whether it becomes more of a negotiating tactic perhaps to get some concessions from key trading partners like china. or whether it really is more of a situation where we really want to be more protectionist in that case there could be more of a dramatic selloff going forward in markets in addition to the reactions we've already seen >> so what do you do i mean, you don't know how that trade situation, that negotiation is going to work out. so we see people selling uncertainty today. is that a good idea or should people look through this and wait >> well, our view really on the u.s. equity market right now is neutral. and the reason for that is again if you step back to the bigger

picture context, the macro context that actually is still very good. if we look at our global economic health indicator and also our u.s. health indicator, what you will see is over 70% of our economic indicators are positive both because the absolute level is still good and/or the momentum in them is still good so you have to weigh off some of the uncertainty factors with the fact that the macro drop back is still fairly good. and so we are advocating just to sit pat where you are and to watch how some of these developments unfold in regards with trade and in regards with where interest rates where headed >> do you want to look to get lighter given the uncertainty? >> that is a great question. coming into the day, we have a 3,000 target by year end what is not predicated in there, what is not included or embiided in there is the possibility of a trade war. certainly not blowing up nafta so as we progress, and it looks -- as the environment

looks like it is getting worse and we're making trade mistakes, then yes, i would certainly say a that is time to lighten up >> would you lighten up on the winners, technology, or would you cut the losers >> i'd cut the companies that have the most revenue exposure to china look at the companies getting hurt today boeing, caterpillar. s ones that need the china demand story >> all right art, lisa, good to see you you both thank you for joining us we want to hear from you head to our twitter page and let us know who you think is having the biggest impact on your money and we'll share the results later on >> so the president's top lawyer in the mueller investigation resigning. what does the reshuffling of his legal team mean? plus we're watching a major selloff on wall street, although well off the session lows. dow cutting its losses nearly in half goldman sachs, caterpillar and 3 m dragging us lower. boeing downely0 cka are.n ar 1bus

welcome back breaking news out of pershing square they dispose their stake in nike the firm a gain of about $100 million on that position, however still down about 6.2% for the year through yesterday melissa, back to you >> interesting timing. >> once in a while he makes money. >> he does, yeah

obviously he has a track record until recently but nike reports this afternoon. so that is interesting should facebook and mark zuckerberg be worried advertisers are going to leave its platform two top ad execs weigh in and listen to what roger mcnamee says the company needs to do >> the advice i've given them is to look at what johnson & johnson did when somebody tampered with tylenol in the '80s they took every bottle off of every shelf and they kept it out until they could figure out tamper proof packaging we owe johnson & johnson for that and for facebook, it is a similar situation. they didn't do this stuff. but it was their platform and these are their users. and i think that the thing they are facing right now is eyth appear legitimately to have been callously indifferent. ach your wealth management strategy the same way to create a financial plan built to last from generation to generation. we'll listen. we'll talk. we'll plan.

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. here is your news update nationwide strikes are causing travel disruptions at train stations and airports in france today as yuns set unions set upo

protest, they are protesting new reforms expected to cost some 120,000 public sector jobs by the year 2022. at least six police cars were involved in a high speed chase in houston, texas this morning while investigating a domestic disturbance the chase ended when a police suv crashed into the suspect's vehicle. more trouble at whole foods. according to the "wall street journal," more than a dozen executives have left the giant while management changes are common, a foermg employrm hefor culturally it has been a rough start. and bruce springsteen will announce his one man show in new york until december 15 that is an additional 81 shows and it is the third time the boss has extended his broadway performance. still one of the toughest tickets in town. that is the news update this

hour bill, back to you. >> i think he's having too much fun. >> i think he is >> somebody said heneeded the money, but -- >> no, he didn't need the money. billy joel doesn't either. >> i said maybe he likes the money. >> well, don't we all. >> that is a subtle difference, but an important one >> thank you, sue. let's check on the markets this hour. the dow was down more than 500 points at the lows but we are well off the lows right now. all three major averages on track for their third weekly decline in the past four apple, coke, merck, the usual suspects the only stocks posting gains inside the dow today >>. >> let's get more on the selloff and bring in a trader. matt, good to have you with us certainly a change in tone considering we have been down 500 points earlier and now we're about less in an a percent down on the dow.

what is behind the turnaround do you think? >> well, yesterday we saw a remarkable turnaround when trump announced that he was going to impose these tariffs so this was just overextended. nothing was super surprising about what was said yesterday or today, so that is why the markets are rallying and we're finding some stocks in correction territory, time to take a little shot here and see if we can get a bounce about that. >> how about when the secretary said here on "power lunch" that look, this is a negotiation, essentially everybody calm down this, is just the starting point and let's see where this goes? i mean, would that have assuaged anyone's concerns? >> i would think so. and that is what we've hoped for all along. it is a problem. there is a distinct disadvantage for u.s. companies in china. so if we can get a goesh yatesing, we can get maybe -- they are looking for $100 billion. if we can get $50 billion, that is a good start so the market 14

should rally >> we had worries going into this week. we had the fed we can put that in a box we had the overhang of tariffs and you're saying it was pretty much in line with what we had expected so put that in a box what do you think the market does now >> it is interesting you keep bringing up putting it in a box. >> because the box exists on the side >> watch this, he will do an ipo plug go ahead >> i'm not going to do the ipo plug, but it is very interesting that it is coming out tomorrow the big unicorn ipo that we've been looking forward to. and they have upsized the terms and deal size. so pricing it in a day like this could bring some perils to it, but we'll see how it prices and that might give a reason for some of the sell side in the tech, maybe they will put that money that they took out of the tech and put it in the dropbox so interesting to watch tomorrow morning. >> i haven't been gone from the new york stock exchange that long i remember you how skeptical you've been in this market

is this decline on the volatility wyche seen, is this enough to convince you you that maybe it is time to get back in and get ready for another move higher >> i can't believe you've been gone for, what, two weeks? so it's been -- there is value down here, right stocks are down10% you know, you can find value in facebook people have been talking about facebook that may not be the one that you want to enter. but certainly some of the other names, you know, you might want to take a shot here after this move the economy is still good. we've gotten the news out of the fed that was slightly positive i would think in the short term. the trade tariff wasn't a surprise so, you know, maybe we can bounce off this level. >> matt, thanks for your input by the way, we did bounce even while we were speaking to matt now the s&p 500 is down by 0.8 or about 22 points and the dow down by just under 1 percentage point, 233 points so we more than halved our losses in the session -- through the session.

so as we mentioned markets off of their worst for the day coming up next, we'll talk about facebook and whether or not the damage to the brand can be sustained or if it is that bad more on facebook straight eaahd.

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that's taking options trading from wall st. to main st. 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 welcome back we're about 2 1/2 hours, now 2 hours away from a huge interview here on cnbc sheryl sandberg will be making her first public comments on the data scandal jewulia boorstin is live ahead f that interview which on comes after mark zuckerberg's apology and explanation which didn't necessarily satisfy everyone >> it didn't satisfy the house energy and commerce committee because that committee just called on zuckerberg to testify saying after committee staff received a briefing yesterday from facebook officials, we felt that many questions were left unanswered now, zuckerberg took to facebook

and then cnn last night to apologize, to explain what went wrong and how facebook is working to make sure it didn't happen again part of the new strategy is a focus on transparency and a lot more communication with users about their data and what has already gone data and what's aly gone wrong >> anyone whose data might have been effected by this, we're going to make sure we tell going forward, with we identify apps that are similarly doing sketchy things, we're going to make sure we tell people then, too. that's definitely something that looking back on this, you know, i regret we didn't do at the time and i think we got that wrong. >> so now, we'll have to see if there are other shoes left to drop about data misuse, perhaps what zuckerberg uncovers in the investigations, and also what kinds of implications all of this could have for facebook's relationships with the millions of apps who interact with it, as well as millions of advertisers. we'll talk about all of that and

more when i sit down with sheryl sandberg in an exclusive interview in the 4:00 p.m. hour of the closing bell. back over to you >> thank you very much, julia boorstin >> advertisers do an about face and yank ads from facebook or is it too big, too powerful to consider leaving the platform? let's hear from advertising hall of famer linda thaler, behind some of the most memorable tv commercials ad, and denise leone, author of what great brands do. denise, i'll kick it off to you. do you think that mark zuckerberg did a sufficient job to preserve the facebook brand in all of the interviews he did yesterday, or do you think addver tizers could think, you know what? maybe we can reallocate dollars to another platform like a google >> i do think we're going to see advertisers pull out of facebook they need to show they're doing something because customers these days are looking for those

actions. so it's not enough for mark to apologize and say he's going to comply with regulations. i think advertisers want to see more proactive action. until they see that, they're going to take dollars elsewhere. >> because it's interesting, the analyst community comes out and defended facebook in large part, saying this is a short-term richblg, not a long-term richk, and at the end of the day, there's a duopoly, that there are so few powerful social media matlo platforms, they can't pull from facebook >> i think in the short term, we'll see ramifications because advertisers need to show they're doing something. in the long term, you're right the analysts are right facebook has created this web of connections that make it very difficult for customers to pull out. and advertisers will go where the customerseyeballs are, but they also at the same time know they have an obligation to their customers to show that they are sensitive to what's going on with their customers and they're doing something about it

>> linda, i see you nodding your head >> well, i think in short term, they're going to leave, but not long term. where are they going to go linked' in >> this is where the mass of people are but i think what's more important is the fact that you have to really trust a company because then if you start losing users, then advertisers, they're not going to want to advertise there. >> that was my question. if users start to pull away, or how about if facebook in their effort to assuage everyone's concerns, start collecting far less information about individuals, their value has dropped dramatically i mean, that's the whole point of being able to advertise on facebook you know so much about those people >> i'm so glad you asked that because i have a very passionate viewpoint about it this has been very enticing to advertisers. buy ads here and we give you these little granular details, but we don't really need all that we're getting very lazy as adviz toors and creative people, i'm fraught the creative side of the business we are big emotional swaths of

people we don't need to get into someone's underwear to sell them a bra. where are the days, i created with a bunch of people toys "r" us kids and the affflack duck. that was about really tapping into the zeitgeist, the emotional understanding of people 99.99% of us have the exact same dna. we're not working hard enough to find the emotionally resonant messages >> we're at a point, i think, where we talked in the past about how people are addicted to social media anyway. people are addicted to facebook. they're not going to walk away you'll get a few people who walk away who do the protest thing, but they'll come back because they want to see what's going on >> i think what facebook has to realize and what advertisers have to realize is they don't have to bereliant on all of this analyst data most of it goes in the garbage we need to do a better job of connecting to people where we don't need to have all that

information. i don't need to know where you bought your jeans to understand the jegenes of the basic human character. >> denise, how do you feel >> here's what facebook needs to do they need to increase their internal oversight they need to extend their policies and procedures to the partners that are in the eco system rather than keeping them off to the side and saying as long as we fulfilled our obligation, we're okay they need to understand that customers don't care about the lines between companies like that most important, and this ties into linda's point facebook needs to connect with their users emotionally, understand that users don't care if they're following the letter of the law users want to know that facebook has their best interests in mind and they're doing everything they can to protect their data until facebook can prove that, i think there's going to be a lot of skepticism out there. >> do you think users care that much is the media and the politicians, are we all making a bigger deal of this than the actual facebook user >> well, there's a lot of

pragmatism like i said, a web of connections. you know, facebook is the way we get access to all these apps it's how we connect with people into our calendars and our scheduling and coordinating. it makes it very difficult to delete facebook, even though that's kind of the meme that outs there right now so i think users have -- are weighing the convenience and access from facebook with the concerns about privacy in the end, i don't think we're going to see a lot of users pull out. that's why i think advertisers will pull out in the short term, but they're likely to come back because users will stay. >> what do you think last word, quickly >> my feeling is totally agree people no longer buy a product they buy into what that product and brand represents they have to represent something that's honest and transparent. >> all right, denise, linda, thank you. we'll have you back to talk about toys "r" us. >> i want to be a toys "r" us kid. >> pretty good >> quick reminder here, sheryl

sandberg will be live in an exclusive interview at 4:00 p.m. eastern time on cnbc's closing bell >> with all the attention on facebook, you may not have noticed apple's role in the tech wreck. stock down nearly 5 persz in a week >> plus, citigroup taking a stand on guns. will other wall street firms atnduc suit? th a mh more when the second hour of "power" begins right after the break. hi i'm joan lunden.

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here's what's on the menu. tariffs, the tech takedown, and rising rate. lots of forces at lay when it comes to the fewer of your money. what should investors focus on and what is next >> it was deafening silence from mark zuckerberg and sheryl sandberg following the scandal does the company have a serious management crisis on its hands what do they need to do to fix it >> could apple be a winner from the facebook fallout one analyst thinks so. he'll tell us why. "power lunch" starts right now and we do welcome you back to "power lunch. i'm bill griffeth. a down day on wall street, but stocks are well off session lows the dow had been down about 500 points now on pace for its lowest level since early february at the moment the street's fear gauge, the vix, jumped more than 20% in

early trading today. we're back to the almost to the 20 level right now tech continues to tumble the fang names all in the red, led by facebook, which we'll talk about that's in correction territory, as you probably know industrials taking a hit as the president announced new tariffs against china for intellectual property boeing, caterpillar, 3m the worst performers in it dow today. the financials have been under pressure as well, as yields have been falling bank of america, regions financial, comerica, jpmorgan among the big losers in today's trade. michelle >> i'm michelle caruso-cabrera thanks, bill here's what else is happening at this hour. you'll be happy to hear that ceo pay reached a new high in 2017 median pay for the ceos of 133 of the largest companies hit $11.6 million. highest paid last year

>> john dowd resigns he had opposed trump pfls desire to be interviewed by mueller's office >> and abbvie said one of its cancer drugs had disappointing results in a clinical trial, but it's not giving up on it shares are down big on that news bill >> let's get back to the markets. stocks, as we said, off their lows but extending yesterday's decline as tech continues to weigh. the presence announced the tariffs. bob and mike join us from the floor of the new york stock exchange this is one of those times, i have been hearing this in the newsroom we talk about the president announcing the tariffs we talk about the fed raising rates. we talk about facebook going lower. then somebody says, yeah, but why is the mark down as much as it is today anyway >> look, what we see today is the market cares about two things a lot trade and tech on trade, the market turned around at 12:15. watching kayla, she came out with the details, and it did confirm there was a 30-day comment period

the market has been waiting for a confirmation of this because it believes this will provide an opportunity for industrialists to come in and dilute the impact of the tariffs overall what i think we're not getting answers about is the fact that tech is no longer a leadership group, not just fang, but even semi-conductors and that's really continuing to weigh on the market >> the large cap indexes don't really have a great answer when big tech and the banks are both in decline that's the case today. those are obviously the two biggest market cap areas also, not an obvious place that's going to take up the slack. that's what i think you're seeing and what i would call another tremor in the markets. you also had people focused on these levels of the s&p index go backing back down below, let's say, last week's lows. it's going to look like it's not as favorable i don't think that's make or break for today, but it definitely was one of those things that the tactical traders were focused on in the absence of good market leadership. >> as the whole thing grides on,

lack of leadership, into three weeks. you can see the professional trading community flailing around to try to figure out where to go next we're talking about suddenly utilities are market leaders russell 2,000 is up, and that's a big thing this month, but the problem is that is not enough to really move the market forward nobody is going to use utilities as a leadership group. it's flailing around a little bit right now, trying to get in the right direction. >> yeah, as that trading range eventually breaks out, let's discuss more >> how should investors play this market sell-off let's bring in rob insana and jack good to have you here. ron, okay, we sold off in the last couple days a lot but we have really been stuck for weeks now after that tremendous rally what's the problem >> i think we're stuck on policy, and we're stuck on a variety of different policies. trade being principle among them, but also rising deficits as a consequence of the budget

plan and the tax reform bill at a time when it's getting little more difficult to fnls those. and i think you have a chaotic white house, to be perfectly blunt. the president letting go of his top lawyer in a situation where he's ignoring his advice to be constrained. i think it just adds to the concern about whether or not there's a real strategic vision behind any of the economic policies, not to mention some of the political uncertainties that exist with respect to this administration as well >> should you sell into this would you sell right into this, or do you look through this and say, you know, things are going to calm down eventually. >> since i don't manage money, it's not what i would immediately do i think in the next six months, we'll start to see real potential weakening both in the global economy and in the financial markets. i would be inclined to start shepherding some cash in places where you had big wins and save some money for a rainy day >> jack, what do you think as larry kudlow would say, it's all about earnings and for the most participate, they have been still coming in pretty good here

but yet the market still has this turmoil what do you see happening? >> well, i think just innition to what ron said, it's fed policy, too, weighing on the market we heard from jerome powell yesterday. and if you consider that bernanke's term was defined by the crisis and yellen's term was defined by accommodation, i think powell's term will be defined by normalization the problem is, normalization means rates have to go back to where they should be and that means the ten-year at probably 4 something, but also, if you look at the taylor rule, that's saying 4-something, too weather you agree with the taylor rule or not, the fact is that overnight interest rates do have to be appreciably higher, and that's going to create a headwind for stocks for the next couple quarters. that said, all of these problems are artificially manmade, if you will and so i'm not necessarily

worrying that this is some kind of a systemic problem, certainly. i'm not even concerned it's a cyclical problem i think we do need some realignment in interest rates and that's going to put downward pressure on equities >> should we be worried about overnight rates, the notion that short-term financing costs are going to rise for a lot of companies out there? >> as jack was saying, maybe less so from a crisis perspective going back to 2008, where many companies and financial institutions relied a great deal more on short-term wholesale funding and adjustable rates. they may be less sensitive to that type of an increase libor, domestically, has been doing some strang thinjs wapping up a lot, and i don't know if that's a sign of stress in the system somewhere. credit spreads are widening out. that's problematic to a certain extent there may be a rabbit in the wood pile here somewhere that can jump and scare us, but it's hard to identify exactly where it is. >> even the broader question that you brought up, jack, in terms of long-term interest

rates raises the question of what do you pay for earnings even if they go up, if you have a nice 4% yield on the 10 year, which is very safe, or so we think, then suddenly there's a lot more competition to stock. if the ten-years go to 4% at some think, what should the forward multiple on the s&p 500 be >> sure, yeah, i would think that the equity market, if the ten-year treasury went to 4%, 4.25%, the equity market should be 15% lower than it is today. the fact is that the equity market has been an only child in the tug of war between stocks and bonds over the last ten years because the central banks have forced the bond market to pull on that rope with one arm tied behind its back if it does get back to normal, then this only child syndrome has to fall back but that said,ilities it's just matter of time i'm not sure as a long-term investor that i have to worry,

do i want to get cute, raise cash, get back in? maybe short-term investors, those who are more sensitive, sure, if you want to raise some liquidity here and look for dry powder over the next couple quarters, you'll probably find a better entry point but i think if we're looking at equity investing over the next five to ten years, i would view what we're doing here as more or less a speed bump. >> the one thing i would say from a bigger picture perspective is some people have been making the case the president is taking a strategic approach to trade. to me, if that were the case, he would go in front of the world trade organization, presenting the case, and in the event the u.s. won, the world trade organization would allow the united states to impose retaliatory tariffs. this seems as chaotic as anything else. >> not this white house. >> i understand that i think there's a certain element of, i hate to use the word uncertainty because it's so overused, but the market is concerned by the process by which we're going through these

events >> indeed. ron, thank you >> yes, thank you. >> jack, thanks for joining us >> griffith with an i, correct >> used to be. >> facebook users data scandal raising concerns about privacy in a tech driven world this could actually be good news for apple. joining us is ubs manager director steve, who says people tend not to worry about privacy until they do. that seems like a lot of problems out here. good to have you with us you say apple has an advantage isn't it easier to have an advantage on the privacy front when you're fundamentally a hardware company as opposed to the company facebook is which resolves around advertising and collecting data. >> definitely. tim cook said privacy is a fundamental human right. that's terrific, but it's a lot easier to say when your business model isn't selling customer data to advertisers. so on the negative side, apple obviously is mostly an iphone company and really hitting maturity in fact, just this quarter, the idea of a super cycle is pretty

much out the window. on the other side, monetizing through hardware now looks like an advantage apple has been clear about not sharing your data. they encrypt it. you have to ought in for it to be shared. it's clearly not a negative, and it protects the brand. can apple turn it into a positive >> steve, what if you live in china? i bet you don't have that much privacy. you yourself highlight apple has given in and they host their consumer data in country, in china. i don't believe the chinese people have privacy from the chinese government >> well, that is certainly a question in this case, apple has said, look, we're going to play by the rules of the countries we're in. china has asked them to host china consumer data in china, so they're using data centers there. you know, whether or not the chinese government has access to that, i don't know, but obviously, it brings up some issues in that case, they're saying, look, we're going to play by the rules of the countries we're in. so yeah, that's potentially a negative for them in many people's eyes.

in some countries i would argue it's an advantage. scott mcneilly who used to be the head of sun microsystems at one point said privacy is gone, get over it. it feels like millennials are not so concerned about privacy, but as melissa said, you're not concerned about it until it's gone people are now concerned about it apple is in a relatively stronger position. >> do you think this will lead to a mass exodus of users? if advertisers are going to leave facebook, it would suggest that they believe that there will be fewer people looking at facebook but do you think that's going to happen, though >> well, i'll leave that to our internet analyst i don't think he's expecting to see a mass exodus on facebook. he continues to have a buy on the stock. but you know, we'll have to see how this plays out for me, the question is can apple turn this into a positive. one area we think apple may be targeting is health care you health records are perhaps the most private you have. apple is working with three

health records companies, 12 hospitals now, and you know, potentially creating a business not just around apple watches which gather the data, but perhaps their services >> it was never going to compete against facebook i don't understand why this could be an advantage for apple when apple never competed within the same realm and would never compete in the same realm as facebook, even on the health initiative if they're perceived as preserving privacy because they're a hardware company, they never had much of my data anyway, how is this an advantage? >> well, it's an advantage in terms of competing for investors' dollars, first of all. you're right, that they don't directly compete they're sort of the opposite google and amazon, for example, give away hardware to get the data apple has to give away software services to get the premium on the hardware they're not necessarily directly competing but competing for investor dollars you're seeing them compete more with the google phone, with the home pod versus alexa and the

amazon echo in the home. and at the end of the day, i think the brand matters quite a bit around the world, including in china which we just addressed. you're right, not a direct comparison, but i do think over time that it matters i would say at this point, it's not a negative for apple, and there's a question, can they turn privacy into a positive >> got it. okay steve, thanks so much. >> thank you so here's what else is coming up on "power lunch," the president announcing new tariffs aimed at china we'll look at the three key takeaways for investors, and the facebook fallout continues facebook's top executives try to contain the damage will the stock suffer a long-term crisis of confidence >>place, nike's on deck, reporting earns after the bell are they going to race higher or get tripped up all that and much more coming up on "power lunch" right after this ♪

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him, ah. oh hello. that lady, these houses! yes, yes and yes. and don't forget about them. uh huh, sure. still yes! xfinity delivers gig speed to more homes than anyone. now you can get it, too. welcome to the party. welcome back president trump announcing a new round of tariffs this time, targeting china earlier on "power lunch," we heard from wilbur ross who minimizing the impact of retaliation. >> i think there will be some ultimate retaliation but i don't think it's going to be the end of the earth. think about the $60 billion figure the president mentioned and that you quoted. it's a tiny fraction of our economy and a tiny fraction of the chinese economy. so it's not as though we're

blowing them up. >> is he right, or could these new tariffs spark a trade war? and what are the key takeaways for investors? libby is head of public policy at pimco welcome back good to see you. >> good afternoon. >> what do you think he told us, he's expecting some sort of retaliatory action from the chinese on this. that would constitute a trade war, wouldn't it >> well, yeah. look, there are lots of details that remain to be seen on this we don't know exactly the products that are going to be targeted we don't know really the breadth of the scope we know sort of the general sectors. but again, don't really know the products i think it's difficult really to assess how china will react. what we do know, however, is that this has been very consistent with president trump's approach on trade just in general he has had really been very consistent all of his public life on trade. he really has, i think,

sincerely felt like the united states has gotten short changed on these free trade agreements in some ways, this has been well telegraphed to the market. we knew this was coming and have known for several months this was going to come. again, it now remains to be seen in terms of the details and of course the big question mark is how china will react >> so what do you tell investors? because although you say we have been anticipating this for months, clearly, the markets are worried at this point when it actually comes >> well, yeah, and we have been flagging this for our clients in terms of just being one of probably the biggest policy risks coming out of washington in 2018. and again, i think it is predicated, right, predicated on is this the beginning, which president trump alluded to earlier today, that this was just the beginning of these section 301 investigation-like related tariffs. and how targeted are they to china? because i think unlike, of course, these other actions we have seen on section 201,

section 232, these other trade enforcement actions, this section 301 action is just targeted towards china so this is the beginning of other actions that are singularly focused on china, then i think we could see an escalation but again, lots of questions remain whether this is the beginning or near the end. >> libby, have you modeled out a worst case scenario? >> again, we'll learn more in the next couple days given we are expected to see the product list, you know, the press reports say it's about 1300 products it will really demand on which products those are >> what if it's all of them? >> well, if it's all of them - >> at the maximum amount, all of them >> you know, the trump administration has said that they're targeting kind of the value of these tariffs to be around $50 billion to $60 billion. you know, that's not inkaungs conventional from a gdp perspective. however, this is what we're telling clients, if you look at the other measures that the

trump administration have put through, which has been very supportive of growth, the spending bill, the tax bill, in some ways those dwarf what these actions are, kind of in isolation, but again, the big question will be how does china respond? and is this the beginning of a further escalation, because if it is, then this could actually get significantly worse from an economic perspective >> as we pointed out to secretary ross, you know, the fed's concerned about this as well they talked about it during their fomc meeting, feeling the trade policy is a headwind more than anything right now to growth, as they're trying to raise rates at this point. do you think that they -- it could take one rate increase away from their agenda this year if this happens? >> again, trade policy is one of the reasons why we are firmly in the camp of this new neutral view that interest rates just in general will continue to remain lower. and we do think that this is

cause for concern for the fed. however, again, going back to all the other pro-growth things coming out of washington, they're just weighing this but certainly, it is going to be a consideration, and you know, in fed policy going forward, if this continues down the path that we think it is going to again, i go back to what president trump has said, really his entire public life he really has had this trade sort of in his sights for a very long time. really since the 1980s, with trade with japan i think we need to take him seriously on this. this is something he really does want to rectify. >> libby, thanks >> thank you >> if you go back to his appearance on oprah, you can see it on facebook 20 years ago, complaining about trade. >> so he is consistent >> sounds exactly the same >> citigroup is changing its policies on the sale of firearms by its business customers. plus, facebook falling again today, down nearly 10% for the week what should mark zuckerberg and his team be doing to manage the

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citigroup taking a stance in the gun control debate, setting restrictions on the sale of firearms by its business customers. wilfred frost joins us wilbur ross is on my brain, i apologize. >> don't worry at all. citigroup has announced a sweeping new policy in order to, quote, prevent firearms from getting into the wrong hands, according to a memo sent by ceo to employees ed skylar, the executive vice president of global public affairs also added, quote, as a society, we all know that something needs to change. as a company, we feel we must do our part under the policy, citi will require new retail sector clients or partners to number one, only sell firearms to someone who has passed a background check, number two, restrict the sale of firearms to individuals under 21 years of age, and not sell bump stocks or high-capacity magazines. citi's ceo said he was speaking to other financial services companies to see if they would enact the same policies.

he said, quote, i know some will find it foo striblth, while others will find it too lenient. ifclino if clients do not want to reform, they will respect their decision and work with them to transition their business away frame citi but that the practices have widespread public support, according to their polling data. guys >> i'm fascinated by that, you know, i was going to ask, you know, the possibility exists they could take their business elsewhere, but they're already thinking about that and they would transition away from that. is this a business decision or simply a political statement they're making here? >> well, or you could say it's a moral decision based on the explanation behind it. clearly, that's certainly a theme throughout it. i did ask the company exactly what portion of their current clients already sell guns, ie, could be affected by it, and i haven't gotten an answer yet i don't know how significant it is to their overall business, but they seem to be relaxed to

say they feel public support is behind this. >> very interesting. before we let you go, i know lloyd blankfein speaking moment ago, addressing his tenure at the company, which you have been all over >> he was asked the question, phrased along these lines, saying i know you haven't announced your retirement yet, but are there other things you would like to do next? and this is what he had to say >> i'm worried about it. i don't know my wife says don't quit. i think part of that is selfish. she doesn't want me around when things are going badly, you can't leave. when things are going well, you don't want to leave. and so you almost by definition, you have to leave when you don't want to leave. i don't think i'm destined to leave because i'm finding something else attractive. i think i have to have the discipline to leave when i want to stay. >> the whole answer there was

about five or six minutes long if there was one theme present throughout, he wanted to make it clear, this was up to him. he was in control and he would decide the timing. >> still, lloyd blankfein as hamlet has a lot of pondering to do thank you. see you later. here's sue herera with our cnbc news update >> thanks so much, bill. here's what's happening at this hour syrian rebels and their families are expected to leave a besieged down in the suburbs of damascus today. it's part of an evacuation deal that will see the town handed over to the government after years of attacks >> seven clielers who were stranded on a western tokyo mountain have all been -- look at that -- all been rescued by a helicopter today they were taken to the hospital to treat injuries and they have now been released. >> youtube is tightening its restrictions on gun videos it ban includes restrictions on how to make a firearm, and

accessories such as bump stocks and silencers. >> and health officials in salsberry, england, say the russian ex-spy and his daughter remain in critical condition, but here's good news a police detective who was exposed when he came to their aid has now been discharged from the hospital that's the news update this hour i'll send it back to you >> great news. thanks, sue. >> stocks are still in sell-off mode at this hour. the biggest drops for the dow, the s&p, and nasdaq since february 9th dow jones lower by 400 points. had been off by as much as 500 points the s&p 500 lower by 42 points and nasdaq off by more than 110 points that's a decline of 1.5% the industrials are the worst performer in terms of percentages. 1.75%. >> let's bring in chad morgan lander, portfolio manager with washington crossing advisers i can imagine, chad, people are tuning in, people read the headlines and they see another big sell-off on wall street,

what in the world is going on. what do you tell them? what are you advising your clients to do right now? >> right, well, stay balanced. we think that the u.s. economy is quite strong at a 2%, 2.5% growth rate, and earnings will be quite robust in 2018 and into 2019 but unfortunately, we're still in a low return environment. we forecast that the s&p 500 will be up roughly 5% and a long term forecasted return over the next five years on an annual basis. and as the federal reserve moves up and starts raising interest rates and we're expecting another two to three times over the next 12 to 15 months, then that asset class will be more competitive with equities. >> you know, if you think interest rates are going up, you want to tell people to go to the financials if you think they're going down, you go with the utilities. but that changes day to day. eved today with the market sell-off, the utilityerize the best performing seconder because

yields have gone lower as it pertains to those looking for income right now, what do you tell people to do? >> well, we tell investors not to reach for yield don't be in high-dividend paying stocks on the equity side, go with rising dividend equities. the shape of the yield curve does matter when it comes to sector rotation. we would be overweight consumer staple as well as health care companies. we would be neutral on financials and of course, you have the global uncertainty when it comes to trade negotiations and policy within china and that could have a material impact on that shape of that yield curve. >> always good to see you, chad, thank you. >> thank you, bill >> the oil market is closing for the day. let's get to jackie deangelis at the commodity tesk >> crude prices giving a little back today, but still holding over $64 a barrel. the session high was close to $66. the fluctuations in the stock

market haven an impact trade war fears something to account for as well. still, the market participants i have spoken to think there's more room to run short term and long term they think that the recent inventories are an early sign of strong demand for the summer season it's okay if u.s. production rises as long as the demand is there. short term level to watch is $66.66, $70 after that >> got it, thank you >> facebook ceo mark zuckerberg speaking out on his company's data crisis. stock still falling today. we'll talk to two top crisis management experts on what he should do to get on top of the situation. that's straight ahead here on "power lunch." so what else is new? how's your mother?

umm..she's doing good. she needs more care though. she wants to stay in her house. i don't know even where to start with that. first, let's take a look at your financial plan and see what we can do. ok, so we've got... we'll listen. we'll talk. we'll plan. baird.

facebook's top executives are speaking out today, reacting to the growing outrage over cambridge analytica's misuse of data julia boorstin is in menlo park ahead of her interview with sheryl sandberg later today. >> melissa, the house energy and commerce committee today calling on ceo mark zuckerberg to testify, saying he's the right person to answer to the american people the committee saying that many questions were left unanswered after facebook briefing of their

staffers yesterday saying, quote, the latest revelations regarding facebook's use and security of user data raises many serious consumer protection concerns. this comes after yesterday zuckerberg outlined his plans to insure this kind of data harvesting doesn't happen again. zuckerberg also saying he's open to being regulated indicating he think it's not a question of whether facebook will be regulated but how. >> you know, there were things like ads transparency regulation that i would love to see if you look at how much regulation there is around advertising on tv and print, you know, just not clear why there should be less on the internet you should have the same level of transparency required >> it's notable there that zuckerberg's equating what facebook is doing with advertising with what media companies are doing with advertising, a comparison to media companies that zuckerberg has pretty much resknrekted in the past we'll see what sandberg says

about the potential impact of regulation on how advertisers work on facebook when we sit down for our upcoming interview at 4:00 p.m. eastern back over to you >> we're looking forward to that big interview. absolutely thank you very much. for more on the fallout for facebook and what to expect from sheryl sandberg's interview, let's bring in dean and robert wrrg welcome to "power lunch." >> bob, what would you tell mark zuckerberg right now >> i think we should put all this in perspective. tens of thousands of dollars have bun lost by a lot of people it's not coming back anytime soon because people don't know what's going to happen in the marketplace. they don't know about regulation they don't know about zuckerberg's plans worse than that, the data of tens of thousands, millions of people have been compromised here and they don't know what's going to happen as a result of it. so i think one of the things zuck zuckerberg has to do, more than an apology and a statement of we'll get it right over we'll be regulated, he has to give us a

step by step, minute by minute plan on what he's doing to do. this is the one of the most serious things that's happened in the tech world. if i was in google's shoes, in apple's shoes, i would be concerned too because there's going to be a focus, there certainty and the confidence that the public has had in the tech sector has been shaken badly. >> does he need to sit down in front of congress? >> he should sit in front of congress congress should call on him. i am totally against regulation of any kind. i'm surprised he called for that but if he's going to be regulated, he needs to sit down in front of congress and shape it now the way he needs to get it shaped. a simple statement of, we're going to get it right, not right. we need a lot more than that >> dean, agree, disagree >> i think there's been a total sham so far. you know, we found a situation here that is totally, you know, flummoxed anybody. they have had no crisis plan in place. that's unprofessional. secondly, they didn't marshal a crisis team, including zuckerberg that's unprofessional. thirdly, they had no bold statement to make, in fact, it's

been beached on a sludge bank of corporate puff and finally, hide nothing, tell all. you know, while zuckerberg is saying their onest ads act might not get through and he's open to regulation, the company is spending millions of dollars on lobbying groups in washington right now against regulation my concern this afternoon when it comes to sheryl's statement is she going to speak with a forked tongue? if you weren't aware of this, you're incompetent if you were aware of this, you're complicit >> she in particular is at risk of being labeled hypocritical in many ways, right because she's been so out front about all kinds of issues with lean in, et cetera even more so than zuckerberg >> absolutely, but zuckerberg is facebook the fact we're putting so much onus on sheryl to me seems odd, but what happened yesterday with zuckerberg is a very weak corporate path self-defensive kind of situation. let's see what she's going to say. it's basically, are you incompetent or were you

complicit. >> it's really a matter of what do we not know sandberg and zuckerberg have had a terrific run they made a lot of money, a lot of attention, a lot of publicity. what do we not know now? they need to give us a details plan on what they're going do. >> it's interesting because i read through a lot of transcripts of the mark zuckerberg interview i thought recode did a great job. in it, zuckerberg sounded like he was addressing the concerns of the user as opposed to the consumer base. there are two buckets to address and have this different aura about them, right? on the user side, you want to say, you know, we're working to make things better but he also said certain things that would upset the user base such as the investigation of this is going to be expensive. that's what he told recode's kara swisher investors don't want to hear that today, sheryl sandberg is coming on cnbc, not talking to the tiemdz, not talking to cnn

she's talking to the investor base what does she need to do, what does she need to say to the investor base? fwl we have it under control she needs to say it's not as bad as you think it might be she needs to say we have a plan. she needs to say it's going to be acted on very quickly, and she needs to restore confidence in investors so much money has been lost, it's incredible. it's simply not right. if i was google and i was apple, if i was in the tech space, i would be concerned about my stock right now as well. >> i wonder if, do they have to make a choice, though, between talking to the investors or talking to the users >> it's almost the same prk, because they want to keep the users to keep the investors happy. at the same time, which zuckerberg says we're open to regulation, open to testifying in front of congress, and the investigation is going to be expensiv expensive, those are things investors do not want to hear. >> investors themselves use facebook we think that's what they do, they use facebook, the media people use facebook. lots of people use facebook. so it is very important, i think

it has to be user based. what we're seeing from here is the need for regulation, and that's all about protecting data for the user it's become a mainstream topic, it's on the mind of everybody. in fact, some research shows at least 70% of consumers today are concerned about privacy and security so it's a big topic. >> if we think that cambridge are the only bad guys out there, that are using facebook data and other data, we're sadly mistaken there are a lot of other bad people out there they're active right now facebook should be aware of that they have a serious problem. >> all right >> going to leave it there thank you. dean and robert. >> and reminder here, sheryl sandberg will be live in an exclusive interview coming up at 4:00 p.m. eastern time, right here on cnbc >> i bet she can't wait for that >> straight ahead, we'll tell you what the street is saying about facebook right now will the difficulty of protecting user data hurt the mpy ngerm or is this a buying opportunity stay tuned rise higher than ever. as the world leader in unmanned aerial systems,

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facebook stock continuing to fall, and now down more than 9% this week alone. ceo mark zuckerberg speaking yesterday after three days of silence. what wads wall street's take on his comments and his announcement of the company's new policies bank of america saying while zuckerberg addressed the issues,

there was nothing that could be said to appease the most vocal critics and that backlash will persist. they expect impact to usage and cut the price target one writing zuckerberg's comments should be viewed positively by investors. the analyst notes it should allay fears about radical changes that could hit the business model it maintains its $200 price target and steeple saying there are few answers even after zuckerberg's comments the question comes down to, will facebook do the right thing? if they do, it will impact their business if they don't, they'll run into more trouble the firm cuts its price target to $168. keeps its hold rating. for more analyst reaction to zuckerberg's apology, let's bring in the analysts. gentlemen, great to have you with us. ken, i'm going to kick it off with you regardless of what analysts are saying, whether they're pleased or not with zuckerberg's appearance, sheryl sandberg gets another chance on behalf of

facebook today with julia boorstin what does she need to say to you to allay your concerns >> you know, i would like to hear that they're still very focused on innovation. i think as important as it is to apologize for a misuse, i think it's also important to be able to recognize that this company has always been trying to do more with data, with compute, and has really been trying to push the boundaries. there are times when it doesn't work clearly, that would be a fail harder, but i would say when she's speaking, to apologize is important, but at the same time, protect facebook's ability to continue to innovate and continue to try to take platforms in a future direction. >> the ability to innovate, meaning don't be regulated into not being able to innovate are those the right dots i'm connecting >> i think so. to fall on your sword too quickly and apologize profusely, maybe that's part of it, but at the same time, i was pleased with the written statement by

the company, as we look to the interviews, i think there were things that were said that probably didn't need to be said. i would like to see that the company, which really started as a company trying to not just offer advertising but trying to change advertising as we look forward to the future and think about how we will interact as people, as businesses, as developers, i think a lot of what facebook has done is very good. i think that facebook should be -- they should give themselves a little credit for that >> ali, same question to you when ken was talking about things that maybe should not have been said, what jumps out to me is the headline that maybe facebook should be regulated or his comment to kara swisher that, you know, the investigation is going to be expensive, for a company whose margins were in question for 2018 to begin with, what do you want to hear from sandberg at this point >> well, i agree to a certain extent, there is probably going to be some regulatory actions going on because what facebook basically

mostly worries about is that its users are satisfied. that its users, that it can maintain the user base on its platform that's what attracted the ad money. i think that's something they need to worry about. another thing i would hope that she would talk about is if facebook is aggressively changing its strategy and more aggressively actually focusing on instagram instagram, in my opinion, number one, it has a different brand. so you could actually see that some users do not necessarily right away relate it to the facebook platform. and, number two, in terms of the upside on revenue growth, i think it's much, much more attractive so, if she could provide additional color on their strategy regarding instagram, i would be pleased with that. >> all good points, guys thanks >> pleasure. >> thank you meantime, nike's falling ahead of its earnings. do you buy ahead of the results or stay away the debate next.

well, it's earnings season once again. >>yeah. lot of tech companies are reporting today. and, how's it looking? >>i don't know. there's so many opinions out there, it's hard to make sense of it all. well, victor, do you have something for him? >>check this out. td ameritrade aggregates thousands of earnings estimates into a single data point. that way you can keep your eyes on the big picture. >>huh. feel better? >>much better. yeah, me too. wow, you really did a number on this thing. >>sorry about that. that's alright. i got a box of 'em. thousands of opinions. one estimate. the earnings tool

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trading in the red once again. let's bring in the trading nation team. craig, you put out a note last week calling nike a buy. why? >> well, we like the chart we like the longer term setup from what we're seeing here. you can see there's this big base that's been forming over the last two years you're seeing improving relative strength from our perspective on the charts, a close above $65 is going to open up the possibility of aid whole other leg higher from here. we like the relative strength, we think it's a buy. >> larry, your thoughts on nike? >> i'm looking at retail more broadly. legislation in washington on the community banks is extremely beneficial, extremely beneficial to the hxb and some retailers in the hxb etf -- >> do you mean the -- hxb is the home building -- >> there's a basket of retailers in there. >> i got it. >> those home builders have exposure to the consumer

and this legislation's really going to free up a tremendous amount of lending to smaller banks. and i think that's -- number one, i think the legislation will move forward in the next week or two. this pullback in the market is creating a really nice downdraft in that space. and then the catalyst when the legislation passes is really historic you're talking about a remake of dodd/frank that will substantially help this sector. >> thanks for your thoughts. for more market insight, head to our website at tradingnation.cnbc.com check, please, is next >> announcer: and now the latest from tradingnation.cnbc.com. and a word from our sponsor. >> in a losing trade, avoid letting your emotions get the best of you. too often traders want to add to a losing position. but experienced traders will say, your first loss is your best loss. in other words, take a sllma loss and move on before it becomes too big. it was my very first car accident.

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welcome back looks like the market is going to reproach the lows of the session. they had been down by almost 500 points the s&p is off by more than 1.5% ditto for the nasdaq composite the s&p right now at 2667. >> so, we ask you on twitter - >> check please. >> -- out of mark zuckerberg, fed chief jay powell, which is having the most result 19% say zuckerberg

63% say the president. >> wow >> lots to fear here with trade wars. >> indeed. as you know when i was asked if i would do "power lunch," i said, only if i can do check, please we wi delly and i would do "closing bell," we would love cheek, please. >> are you serious >> today we highlight the life of a man -- those who grew up in boston will remember this bozo the clown, frank averich was your bozo from 1959 to 1970. he was the brain child of larry harm harmon he sold the rights to different stations around the country, so each city had a different bo sfwlchlt o mine was larry harmon. willard scott was bozo in washington, d.c. we mourn the loss of frank, who was bozo in boston he was 89 years old. >> it was like a franchise. >> it was. >> exactly >> i had no idea there were

multiple bo sfwlchzos. >> it's a bearish day so we wanted to end the day with bear cubs aren't they great? bears for a bearish day. >> here's our kind of cute why do we fear the bear? >> because they'll kill you. >> don't fear the bear. >> "closing bell" starts right now. >> that's true, check, please, is the best part of the day. >> that was a great check, please and a great "power lunch. live from the new york stock exchange, this is the "closing bell." i'm kelly efbs. >> i'm wilfred frost we're counting down to our exclusive interview with sheryl sandberg her response to the big scandal is coming up. >> in just about an hour we also had the president's announcement on china tariffs creating those fears of a trade war. look at the markets. we're live in wash with tington what that means fo