there. the consolidation sector is still continuing i like them. >> upside call buying just one week out. >> good stuff, thank you very much thanks for watching. power starts now >> i'm sarah eisen here is what is on the menu. stocks rebounding today as the administration down plays that impact imlying it's all negotiation should you buy in. facebook stock getting a bump today as mark zuckerberg says there's no impact in the data scandal so is it just a flesh wound for the company? and making green on the green. it's tiger mania in the sports world today as the golfer returns to the masters we're live in augusta with a look at the big money behind tiger. power lunch starts right now

♪ >> why are we playing that music? you'll see welcome to power lunch the market come back continuing today. the dow is 1,000 points higher since yesterday's low. s&p up nearly 1% the nasdaq and russell 2000 higher by .75% what's the leading sectors energy, materials and discretionary are all at the time materials higher by almost that much consumer discretionary higher. retail is in the red but it's the only sector in the red boeing, dow dupont, all leading with gains of all more than 2% sometimes 3% and the bank stocks are also moving higher lead by amazon and facebook which are higher by 2 and 3% respectively. positive day for financials as well morgan stanley, citigroup, j.p. morgan up nearly 2% or more.

>> stocks building on yesterday's big reversal the dow nearly 1,000 points off of that low. bob is at the new york stock exchange as always, the turn around continues. >> people keep ask me is this because of less concerns over tariffs and trade wars i think it is. look what happened with europe the big industrial stocks big equipment. agricultural equipment company volkswagen and fiat. all car companies. they rally big time. this is definitely concerns about the tariff wars easing a little bit so we have energy, materials, financials, technology stocks also rallying today. there's a little bit of an issue

today. do you see that semi-conductor here today we have a very interesting call. one at ups initiated a call on micon. that's a major problem now people tell me analysts don't matter anymore no one cares what they think things get dicey here. the conversations are going to be changing the next few days. the old conversation, tariff and trade wars a little less concerns here. there's no timetable for talks the president's men were all saying we're not sure about that it's going to be an issue and next week earnings and guidance and then is micro worth $50 or not on earnings? it's going to matter very much just off the highs, 291 for the

dow. >> thanks, bob one of the reasons stocks are bouncing back, president trump's top economic advisers they're talking up the markets and talking down the threat of a trade war. kayla has more details at the white house. >> hey, michelle it's been full-court press from the administration looking to ease tensions in the market over trade the goal is free trade. >> the vision is to get to a world not dominated by massive trade imbalances driven by unfair trade practices but to a world of free trade. they're 3450moving in the right direction and the market will love the outcome that's when it kicks off in peru officials from the white house

and mexico and canada are meeting in washington. here's jared kushner entering early today. washington's urgency is driven by the process a deal would face in congress, the upcoming mexican elections and surge in popularity for the antiamerican candidate and potential uncertainty here there have been some reports that the u.s. is showing some new flexibility in nafta talks, sources participating in those say the u.s. proposals are still being received some what contentiously and they are taking any potential for a break through this week with a grain of salt. melissa. >> eunice is live in beijing for us

>> boasting that china's quick response with it's own tariffs caught the trump administration off guard. the official papers have been pointing to three things one president trump's tweet in which he said we are not in a trade war with china the commerce secretary ross interview on cnbc where he suggested these actions were all headed for negotiations and also including larry kudlow's comments that it could be a negotiating tactic and won't go into effect. people's daily had a headline that reads china stands firm and wins the first battle of the trade war and the commentary argued that china's list hits trump where it hurts since the origins of these products are places where people tend to vote for trump the china daily says china demonstrated that it can't be coerced and is fully determined to reciprocate the communist party as well as president xi have been trying to

project an image of power to the public through the state media to make sure that they're seen as the defenders of china's national interests when it comes to the west. if the trump administration is negotiating then it's time to give up the useless tariff weapon the door is open but china does have some of its own conditions. >> thank you very much with a view from china. meantime all three major averages up for the third straight day up more than 4% since monday session low. does it mean the market is ready to move on again to focus on earnings season good afternoon to you both

gentlemen. a potential deal on nafta next week negotiations versus a trade war. was this all just a bunch of bluster? >> we'll have to keep an eye on it i remember a couple of weeks ago when there was a full-court press to tamp down on trade fears and a new round of tariffs so this is going to be part of the new normal where we'll give the parties the benefit of the doubt that they're all negotiating and posturing. what we do notice is that it's 800 points the multiple that investors are being to pay has gone down by 2 points this is hitting people on investor confidence and people need to be worried a little bit about whether the other actors involved might start to kind of act in a way that these things are going to get out of control.

>> on today's rally, pretty strong and broad based energy and materials and the lead are you convinced, is this a buy? >> the most important question is is the rally off the march 2009 lows and is it over or not. and i still think even after the turmoil you have to give the benefit to the doubt but there are basically reached it's target from the march 2009 lows. we had 7,400 for over a year the high was 7186 in the context of a move this big that's basically getting there

the market is really helping we would have come down and tested it and be well above it now. the index is holding everything together right now with the s&p and that still looks okay but even there there's cracks. right below is 2550. it has to hold otherwise you have to start to see the whole march 2009 rally begin to unravel. we look like we're doing over the past couple of days. >> to me the last line in the sand for people watching the show it's critical if you have to be very vigilant because those games in your 401k, ira, they can disappear quickly so if hi to boil it down to one level i'd say look, s&p starts to sit below 2,500. not for a day or two but a couple of weeks and then i think you really have to start to play

some defense because again those games and people have been seeing in their iras and 401k for a number of years now they can disappear quickly. the market takes the stairs on the way up and the elevator on the way down the down side would be a lot quicker than the upside. >> always feels like that. your stomach really starts to feel it. you talked about how the multiple contracted by two points why do you think that is are you worried earnings season isn't going to be as good as thought? is that all because of trade or about the fed >> it's all of the above it's fears about the fed fears about technology all of those are playing into it.

it will give investoring something to sink their teeth into. >> thank you. >> shares of facebook up 3% today. even as mark zuckerberg says millions more users had their data scraped did he convince the markets that he has the situation under control? president trump going after jeff besos and amazon again calling the washington post amazon's chief lobby yist. it's his 5th antiamazon eet twin a week power lunch will be right back i was a c130 mechanic in the corps,

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87 million of its users may have been improperly shared and all can assume that their public facebook data has been scraped but the stock has moved higher as mark zuckerberg announced the range of ways that the company is pulling back the amount of data it shares and he said that facebook's usage and it's ads have not seen any impact from the scandal. >> i don't think there's been any meaningful impact that we've observed it's not good. i don't want anyone to be unhappy with our services or what we do with the company so

even if we can't measure a change and the usage of the product or the business or anything like that, i mean, it still speaks to feeling like this is a massive breech of trust and we have a lot of work to do. >> he was asked a number of times whether he should still be the guy running facebook he said yes, he should and he is sure to face a lot more tough questions perhaps like that one when he testifies on capitol hill next tuesday and wednesday. >> no doubt. thanks so much what does wall street think of the latest comments. just last week you lowered your price target on facebook because you thought there would be a moderation in usage. did mark zuckerberg assuage any of your concerns >> the fact that facebook and the ceo are in crisis management mode and taking a more proactive

approach to privacy and data access, that certainly makes us more optimistic about how the company emerges from this crisis ultimately in fact, there's a positive scenario where they come out on a stronger footing in the near term we have seen from our own survey data a little bit of a down tick in engagement and usage that won't show up in a meaningful way in the me tricks but it's something investors should keep an eye on. >> do you think mark zuckerberg should still be running facebook >> yes we do as founder and ceo and the magic leader if you will of facebook the person that's driven it to the point today, we think he's lead the company very well down the road

but we like the way he turned the perspective over the last couple of weeks. >> how do you think the company is doing in terms of the show ahead of the testimony next week do you think they're doing a good job between mark zuckerberg making himself available to reporters via the conference call cheryl sandberg is going to do a round of media whether it be npr or bloolberg mberg or today shot cetera and then they're going to focus on the testimony do you think they're doing the investors right by going out and talking about all of these things and saying right now that there's no meaningful impact on ad revenue >> well, we'll see what happens in terms of the me tricks. ad revenues are going to be very stable but in terms of the process, i think facebook is going to communicate to users that they are taking tangible steps to try to win back some of that trust

>> do you think you're given the answers or do you think facebook is focussing of the on users i understand some of these are aligned in terms of the end goal but do you feel like you have proper access to the company as a representative of investors interests? >> we won't get that until they report quarterly earnings and that will illuminate a lot of the me trictrics they're talkin about. they're clearly focused on the users and will be looking at those metrics closely. >> what about the regulatory threat especially if you compare a company like facebook to amazon. which one is facing more heat and do either of that increased scrutiny matter to investors >> well, there's scrutiny across the board on large internet

platforms. i'd say the risks are higher for facebook because they are using people's data and there are privacy, there's legal privacy precedence around that in may new rules will take effect i don't believe there's much of an antitrust case for facebook at this point given that they have relatively low market share but there are certainly risks as what is being employed in europe could cross the pond and move to the united states. >> but they're not getting hammered every day by the president. >> well that's true. not yet at least so we'll have to see how it plays out. snchts th >> is that total retail sales? how about e-commerce sales >> 40 to 50% i don't believe there's a significant case and it would

set a very dangerous precedent if we're going to carve up industries in the different sub segments and regulate companies on that basis but only time will tell. >> collin, thank you so much. >> thank you. >> jamie dimon releasing his annual letter today. you know he doesn't minutes words. we'll tell you what he had to say specifically and tiger woods is back at the masters and considered a real threat to win. up next the look at how much the comeback is boosting the golf industry [fbi agent] you're a brave man, mr. stevens. your testimony will save lives. mr. stevens? this is your new name. this is your new house. and a perfectly inconspicuous suv. you must become invisible.

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so he has a view on the economy and believes the fact that unploilt couemployment cou5 but fears many people underestimate the possibility of higher inflation and wages which means they might be underestimating the chance that the federal reserve may have to raise rates faster than we all think. but overall he is relaxed about markets and says he is a little perplexed when people are surprised by large market moves. he also made come mens today about president trump's actions. >> i think regulatory reform is good i hope you can get some real

immigration. and we have a different opinion. i think we want the same outcome. the outcome we want and he has a different way about going about it. >> specifically on trade, he did single out china saying it, quote, has the second largest economy in the world yet still considers itself a developing nation that should not be subject to the same wto standards as the u.s. and other, quote, developed nations. but he favored a pragmatic approach that involved listening to china and a partnership with allies including europe and japan which of course hasn't happened on company specifics he made clear he still favored buy backs even at over two times book value. he said the company would hit and maintain 17% roe in the years ahead and outlined a range of growth opportunities even with already market leaders. share prices up nicely today along side the market and other banks about 1.3%. >> also a big fan of the tax

plan, right? in a very big way. even beyond that sound bite that you played. >> very big fan of the tax plan saying that it was critical to deliver the growth this country needs and actually went through quite a range of problems over the last decade. he put down to policy not having an official tax system was one of them which has been rectified. he criticized obamacare and went into that for the reasons why he pursued this health initiative with berkshire hathaway and amazon as well. >> you know the new york times angle on this. handicapping a run for president in 2020. there's always going to be that speculation when he talks policy wilfred frost -- did you have something on that. >> i was going to say, he maintained the point that we got about a month or two agatha he and the board have agreed he will serve for roughly five more

years. >> thank you. >> white house officials trying to talk down a trade war with china. some industries could still get hurt like california's wine industry. live in napa valley. >> hi there. i am live where they are worried ivat the new tariff is going to dre away customers we'll have that story coming up in a live report has exposure to energy infrastructure mlps? think again. it's time to shake up your lineup. the alerian mlp etf can diversify your equity portfolio and add potential income. bring amlp into the game. before investing, consider the fund's investment objectives, risks, charges, and expenses. read the prospectus carefully at alpsfunds.com/amlp we've been preparing for this day. over the years, paul and i have met regularly with our ameriprise advisor. we plan for everything from retirement to college savings.

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>> already served two terms will be trying to flip a seat that's been held by the democratic incumbent. the cost of treating opioid addiction is soring. the kaiser family foundation says privately insured americans receive $2.6 billion in treatment in 2016 up from 273 million in 2004.

villanova fans packing downtown philadelphia celebrate the tale's ncaa basketball championship it's second in three years villanova cancelling classes so students could cheer their team on it's been a goodyear so far. that's your update for this hour back to you melissa. >> thank you courtney. i want to get a check on the markets here losing team on the tech side the dow is higher by 156 points. the nasdaq is facing session lows just about six points off of session lows it's worth taking a note of certain stocks namely alphabet that turned to the red here. also semi-conductors turning to the red as well. down by one and a quarter percent. >> california wines have become increasingly popular in china and they're among the industries targeted by china's tariffs. live in napa valley where so many visit

tours were often conducted in mandarin. >> they sure are here at the vineyard and winery, there's a real worry that the new tariff could cut into sales. they ship about 1,000 cases of wine into china and one bottle typically costs about $100 in china. >> napa valley is known for its fine wine and for those that can't travel here, stephanie that owns inrutherford california shipped to places like greater china which last year alone imported $210 million of u.s. wine, but with china announcing a 15% tariff on u. s wine they worry they'll take a hit. >> we have been working really hard for over ten years and growing our market and growing our consumer base in china and

this will have an impact on us and our importers and partnerships. >> analysts say china is also the fastest growing import market in the world. that's why the ceo luxury wine maker opus one says china is such a priority for them. >> emerging markets are critical to the health of the larger market and china is one of the most dynamic emerging markets. >> he tell mess that in china, a typical bottle runs about $600 a bottle analysts tell me that at that price point, customers are willing to fork over the extra money in order to get that brand name and tariff or no tariff high end wine will sell. back to you guys. >> meantime, he laid out the administration's vision when it comes to trade listen >> when it comes to trade, the strategic vision is to get to a world not dominated by massive

trade imbalancesand deputy treasury secretary welcome to power lunch. >> thank you. >> so it's a pretty high stakes standoff here. do you think president trump's strategy, if it is just getting the chinese to the negotiating table and getting a better deal on trade a viable one? will it work >> his vision of free trade right after hearing larry talk about the pot of gold at the end of the rainbow yesterday really liking that vision that he has laid out for free trade and, you know, they're right, it does take a lot of negotiation

to get there the heated rhetoric on trade plays well with president trump's base but then there's a lot of time still for negotiation and we're uncautiously optimistic. >> just wondered what kind of deal might be a good one for u.s. companies and u. s. workers as it's intending to do because the tariffs, they're firming the companies that they're trying to help if we end up going there. so if they can avoid that with the deal, what does that even look like? >> that's a good question. so there are some real issues here and then there are some nonissues here the trade balance is a nonissue really and i think if you had steven roach on the other day he laid that out the other day on why that was without going down that road again the real issues are market access, investment restrictions, forward equity caps, local content rules, there's a number of issues related to market access for goods and services and investment in china that are

real issues and we're really hopeful that the secretary and others can get to the table and this can be a win-win for china and the u. s. >> those are goals that you outlined that have been wanted by the obama administration and we haven't managed to get here the methodology used thus far whether it's good cop bad cop or maybe larry kudlow's influence is softening with the gold at the end of the rainbow what is the best way to get the chinese to change the way they trade? >> nice to see you michelle. there's nothing that you can really do to force a country to do something i mean, we're all sovereign nations. i like to, you know, this takes me back to the semi-conductor days not that i was really -- i was alive then but not old enough to

remember but i have read a lot about it. >> the fight is under reagan with japan you mean? >> the japan semi-conductor industry was largely built off the intellectual property with u. s. and american ingenuity it took decades for japan to come around. decades of a lot of painful trade spats and they eventually got there. if you look at what got them there, what got japan to strengthen their intellectual property rights regime it wasn't necessarily external pressure but it was the domestic pressure from within. so once they were enough domestic japanese firms that hit the technological frontier if you will and they became victims of copycats and imitation they put pressure on the japanese

government to inform the regime. >> we have to wait for china to have intellectual property to protect and therefore they might actually get on board but that's a long time to wait but certainly there's examples thank you for joining us. >> thank you. >> let's get over to the bond market >> it's always fascinating how markets particularly the dollar and treasury rates all seem to have patterns that go into big data points. tomorrow is a big data point no exception we have the drift on a whole curve and as a matter of fact fairly close to a parallel shift meaning they're up two base points it doesn't seem to be changing that's the way we go into lots of employment data if you look at a february 6th chart and i really like this one of last year, you'll notice on the left there, that's 263, 2017's high close. that's really the probably most

important level and if we don see it that doesn't make it less important. 24 hour chart of the dollar index. it's up almost .5%. you see that one spike there on the left and how many of them equal out around 9060. zoom, zoom, zoom, year to date chart. that's midpoint of the year for the dollar index and we failed there several times. if it goes through there that's technically significant. when will it go through? well if history is any judge, right around 8:30 eastern tomorrow so it's hard to prepare for. melissa lee back to you. >> rick, thank you up next on power lunch, the mere fact that tiger woods is playing in the masters is a boost for the golf industry. >> as we take a look at this golf ball it's the same ball that tiger woods plays in competition but good luck trying to find them

jese guys are selling outust because of the tiger effect. we'll have more on that at power lunch after this commercial break.

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charles schwab is proud to support more independent financial advisors and their clients than anyone else. visit findyourindependentadvisor.com >> what everyone really wants to know and everyone really wants to see is tiger woods and dominic is the lucky guy that gets to join us from augusta. >> yes, ma'am. this is a tradition unlike any other because of everything all of the stuff that goes into it but this year, there's a huge buzz around augusta simply because tiger woods is back in the picture. if you take a look at the impact that he has had throughout the course of his just last few months on tour, you take a look

first of all of what happened at things like the television ratings for instance, we're talking about double digit percentage gains year over year for golf channels coverage live at the masters just on monday and tuesday. you take a look at the other aspects. ticket iq that tracks resale value of ticket prices, the badges for weekly access to augusta national for the masters nearly or actually more than double what they were in terms of cost. you're talking around $7,700 for a weekly badge to access the masters and if that wasn't enough all the stuff people are selling related to tiger woods like hats, pga tour super stores and the nike tw, tiger woods hat is up 700% in terms of sales over the last five weeks versus the same time last year and the same apliplies for golf balls this bridgestone, tour b, sx golf ball, it's a mouth full but they're sold out let's bring in a man that knows more about this story. this is the bridgestone golf

ceo. thank you for being with us here on power lunch. >> nice to be here, thank you. >> so golf balls this is the exact same ball that tiger will be playing at the masters this week. >> you cannot keep these things on the shelves. >> we have a forecast for the year in ten days we have sold out them. >> you are sold out of this golf ball you cannot keep them in stock. >> completely sold out and we're back ordered so we're scrambling to make more for the balance of the year. >> so take us through a company like bridge stone golf tiger plays your golf ball but none of your other products. is the tiger effect having a sales impact on the rest of your business as well >> definitely. when you look at it not only on that particular ball that he plays but all of our balls are actually increasing in sales and that's the reason is his ability to draw attention to our message and the message of being the

best ball out there for every level of golfer so tiger picked our ball because it was the best ball for him and that allowed us to raise the tide for all of our products. >> as you talk about signing a guy like tiger woods to an endorsement deal a lot of thought goes into the compensation element whether he's worth it for you guys take us through what your brand strategy is around tiger woods what happens let's say hypothetically he does well this week perhaps even wins. how do you capitalize on that? >> if he wins we're in a whole lot of trouble because we're not going to be able to make enough product. so when we looked at it we did research studies and we saw his impact on increasing sales his endorsement alone increases our sales 30% even if he's not plague t -- playing. the fact that he's not only playing but playing well is bringing attention to the fact that he's playing our product and that's increasing everything. >> there you have it the brand impact on bridgestone

golf just because tiger woods is playing it it's a beautiful day out here in augusta georgia and if anybody watches tiger woods they'll be looking for this golf ball if he does well this weekend you can't keep these things on the shelves. back to you. >> certainly hard to find. thanks tiger is on the hunt on the back 9 on sunday at the masters will it be a record breaking ratings event for cbs and what will the broader impact be he is also the former president of sports and entertainment at im fwrk img. you have a steady prediction ratings will be up. >> 50%. >> the highest rate of the masters ever was tiger woods at 14 i think it will be a 10, 11, maybe a 12 he's a human interest story and of course one of the greatest of all time. >> will this have a lasting lift to sports ratings or interest in the sport or is this a one off kind of thing? >> he had an impact.

he's played well this year and for golf it's a real boost of energy and of course it's good for sports. >> he hasn't won a masters in what ten years? a tournament in five years is it bad that golf is so addicted to him? >> i don't think golf is addicted to him because they have gone on and done well over the last four or five years but he's just different. the event down in tampa, it had a higher rating than the u.s. open, the pga, the british open. that's incredible. tiger woods is a phenomenon unlike anything else we've seen in a long time. >> but will it drive amateur participation? >> that's a challenge for golf but this year he's a factor. the numbers back it up. >> why does he have so much star power? >> one he's a great golfer two i think there's a little bit of a human interest story. obviously he had challenges. americans love a come back. >> is he a bigger draw because he's a come back or if he had a

trajectory and straight line would he still be -- >> he was as high as they get. maybe michael jordan he was in a unique category. wasn't he predicted to be if first billionaire sports player. >> for a number of reasons but he's still very impactful. >> clearly. >> it's not a bad place to be at 42 years old. >> nike has a new welcome back tiger commercial it's a throw back to the old tiger first entering golf. they're hoping for a big come back they're already seeing it but does the new tiger resemble the old tiger? the enthusiasm is there but doesn't he to michelle's point have to start winning? >> yes and no. arnold palmer had a great run. hadn't won a golf tournament for 25 or 30 years was pretty popular he's a great golfer but also a

special person >> back to my question what is it personality? what in every industry people come along, right and they have star power for the rest of their lives. even when he is not performing well. >> frank si narnatra. he's in a different genere outside of sports and he's one of a kind and he really drives it. >> is there a next tiger woods >> not at the moment certainly not at golf. there's a great table of young people but not driving the ratings the way he is. the two tournaments that he competed in the ratings were up 150 and 190% there's nobody else driving ratings like that and as you point out hasn't won the masters since 2007 that's amazing. >> are you going to augusta? >> i am. right after this. >> have fun. >> thank you for making some time. >> thank you for having me. >> shares of spotify higher in it's third day of trading but should investors be dancing to

the music? for fear that before long this music streaming giant could trade more like pandora? and what should investors be doing as markets swing widely from day-to-day. sometimes minute to minute these days jack bogle is ing nt joinusexin power lunch. bogle joining us next in "power lunch. >>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 from td ameritrade.

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spotify shares up a little more than 2% right now. the stock has been getting a lot of love on wall street, a number of firms out with bullish notes here, initiating coverage, the latest, steeple, initiating the $180 price target. will the good times roll on or are they heading for the same fate as pandora. joining us, john egbert. great to have you with us. your projections are pretty rosy compared to what they reported at the end of 2017 basically, you're saying roughly a doubling of monthly active users as well as paid subscribers by 2021. help me understand how you get there and whether spotify will have to sacrifice things like operating margin and spend more on content costs in order to hit those numbers. >> yeah, i think the momentum is there, and the subscriber side they're adding subscribers

across all four key regions. doing a little over $20 million a year, which is about where netflix has been adding subscribers for years. they're not going to do it at the expense of content cost because they negotiated better rates for 2017 and 2018. >> your projections are through 2021 so can they keep up? if they hit that gross margin that the operating margin, i should say, in 2018, which is, what, between 23% and 25%, can they continue to do that can they continue to keep those margins while they're growing at this rate? >> yes, they should be able to do it. if anything, the content costs should get better as they have the last few times they have renegotiated the content costs are fixed. a lot of other cost items are a little easier to lever, and those have been kind of clouding the gross margin situation for the last few years we think things like band width cost, the transition to google compute, that will help there. some of the promotions they run a less impactful as they get bigger in scale.

we think they can do around 100 basis points a year, probably in the next two years a little better than that probably 200 basis points a year in gross margins mostly because of content costs >> and the question that haunts this company, how do you maintain a competitive edge when the big giants, apple, amazon, and google are in their pace >> focus, number one, but the strategy is superior a lot of other companies, apple specifically, they found growth and got traction in the market apple is about half the size of spotify subscriber base, but apple still tries to power their lists through curation i think spotify's approach, hiring very good music curators and power a lot of personalized recommendations with algorithms is superior and that will become more obvious over time >> to sara's point, everybody who buys an iphone has the apple infrastructure built in.

the easiest platform to use would be there because it's already there i mean, maybe spotify has the people who desire music a lot and are really particular, but then there's the rest of the world that say, well, i'll use what's already there i feel like apple hasn't even gotten started in trying to compete here >> yeah, they have a huge distribution advantage so does amazon, so does google google is not very relevant in this space because it's hard to get people to sign up and pay. apple has done a really commendable job, but they're adding at least from what we can tell, from what's reported, they're not adding subscribers as fast as spotify spotify should widen their lead unless it changes. it has to be a change in strategy from apple. >> i have a really basic question for you, john, and maybe i'm just a spotify, you know, i don't know enough about spotify and its particular business, but why isn't spotify like pandora i feel like you could have made the same case for pandora years

ago when it went public. >> yeah, they operate slightly different models spotify is a little more in control of its destiny, and spotify is creating a market pandora, the way that it works with royalties, they're a radio service. they had to wait for the courts to decide their rates and they had execution issues spotify's greatest asset over the last few years has been its execution. they're creating a market that didn't exist they weren't waiting for radio users to come over they created on demand, and it's turned the music industry's growth around in the last two years. moe of that is from spotify. >> thanks for your insights. >> thanks. march jobs report is out tomorrow if the jobs market stays hot, will the fed cool it off and could that move spook the markets? we'll discuss all that plus, we're awaiting president trump, holding a discussion on the impact of tax reform we're going to go live to west virginia the second hour of "power lunch." stay with us polk county is one of the counties that you don't think about very much. it's really not very important.

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to make individual cuts permanent. we'll take you there live. >> another jobs report surprise in store wall street is expecting strong numbers for the labor front. will fears of four rate hikes spook the markets? "power lunch" starts right now >> welcome to "power lunch." i'm sara eisen big rebound for stocks all three indices up more than 4% since monday's low. the gains continue off the day's highs. still a triple digit gain for the dow. up 159 energy and materials lead the gains. the laggards within energy, marathon, range resources. tesla also making a big comeback, on pace for its best week since february 2015 rough day for semi stocks. micron, lam research, nvidia off 2% >> thanks.

>> i'm michelle caruso-cabrera here's what else is happening at this hour. blackrock says it will launch two gun-free funds one will be focused on small caps and the other on bonds. both will be offered to certain institutional investors including pension plans. a new report says opioid addiction is costing employers $2.6 billion a year for care and more than half of that spending went to treat employeeschildren. and according to reports, footwear retailer nine west could file for bankruptcy as soon as this week. it plans to sell its intellectual property to pay down its debt. >> stocks are rallying what's behind the bull revival bob is standing by on the floor of the new york stock exchange >> zee a valley, but we're well off the highs. take a look at the s&p 500 we were a good ten points higher just a short while ago and it started coming down after 1:00 we're bouncing back. that was a noticeable drop after one:00 i think i see the problem, and it's in tech, specifically

semi-conductors. energy, materials, financials have been the leader they're off their highs but still doing well tech went negative, and semis were a problem around 1:00 we talked about this all throughout the day, the fact that we had a big ubs call on semi-conductors. that was a problem, and broad com, marvel, and intel with a buy. you can see whether micron, $35 price call, whether that's reasonable or not. a lot of debate about that you see it clearly moved it. about 1:00, the overall complex started to move down take a look at nvidia, a big semi-conductor leadership stock. see that leg down. big volume all of a sudden around 1:10. people came in and actively sold the stock. no clear reason why. they don't put out press releases on why they start selling. this wasn't buyers walking away, it was sellers in the market thought brought the rest of the semis with it and most of the

rest of the market meantime, this highlights the achilles heel of the market. earnings issues. when they came out with the micron call, that got people's attentions that goes to whether the earnings will hold up. the china tariffs for the moment seem to be a little less of an issue. that could change, but we'll talk about wage growth and mr. powell, jay powell, the head of the federal reserve tomorrow, and we'll see about the state of the economy and move to earnings some time next week, friday, when the banks start coming in remember, big growth in earnings anything that attacks that is going to be a major problem for the market that's why micron, the micron call, really moved things. back to you. >> bob, thank you very much. >> we're counting down to the march jobs report with less than 24 hours only 18 hours left will the job market continue to break neck pace of hiring we have seen so far this year and could a strong jobs number actually rev up fears of rising interest rates steve liesman joins us with a look ahead >> quickly, let me give you quick news on the job front that

came in. the national federation of independent business reporting in just the past hour, very strong march numbers for small business hiring, wage growth, and job openings 33%, a full third of respondents report raising compensation. the highest since 2000, and strong numbers like that, leading into tomorrow's government jobs report, that may force the market to think about whether good jobs news is bad news or is it good news or bad news for equities and for bonds. here are the numbers we're looking for. 178, that's on the light side, after doing 313 last month unemployment rate, finally after being stuck for five months at 4.1%, seen ticking down to 4%. average hourly wages are modest at .02%. that's the strong number we got on wednesday some of the commentary i received, ts lombard folks saying, i'll tell you in a second, great u.s. job creation machine is back gaining momentum and a report, something i followed for a long time, they look at how much tax revenue is

coming in. state revenue context are suggesting an acceleration in wage growth. they may be playing a role in strong withholding tax going to some of the states the market prices for two more fed rate hikes this year, one in june, the other september, october, november, somewhere in there. a third hike, which would be the fourth this year, low probability event for now, but good job news could change those odds by this time tomorrow, which is less than 24 hours away >> 18 hours, 22 minutes, and 50 seconds. >> steve, don't move let's talk more about this, and bring in our guest here, bob is sitting here on set to talk about whether this is good or bad news for the markets and also david is global head of investments at citi private bank youcommentary, bob are you as optimistic, and is it possible that it's too strong, that means people think there are more rate hikes coming, and

we hurt the markets? >> no, and yes >> you don't think it wile be that strong? >> you know, february, february is a short month it has a lot of holidays in it you get big seasonal adjustability factors. i have a recollection of a february adjustment number that was 400,000, and by the time they did the revisions, it was back below 2,000 they're not going to revise it down immediately, but i don't know if it's over 300,000. but there's a good chance we come back down to normal >> hold on, if we did get a headline number regardless of if it gets readjusted down the road, we get a big headline number, it will spook the markets about rate hikes don't you think? >> i think it will i'm looking for about 140,000. i think the unemployment rate goes down. continuing jobless claims fell vaeb sharply today that's a good signal that you're going to see the unemployment rate go down i think that's likely. you know, the thing about the job market, it's not just raw job growth we have been producing these

low-skill jobs i hate to talk about the job market in the aggregate, but you hire a ceo, a janitor, same impact on the unemployment rate. you have to realize, that's not exactly right. >> you should guv much more credit to the janitor. >> they're both for sweeping change >> being serious, by the way >> isn't it all about wages? won't we look at the pay number? >> all about wages how the market reacts to wages i think, who knows what the market thinks? i think the tale of the tape is that the market overreacted to the last wage report we keep waiting for this wage pop to happen. the market went a little crazy with a number that in retrospect didn't look quite as hot as it seemed >> the context, though, compared to a month ago, is different in that if we get a strong wage number and it is perceived that the fed is more likely to proceed on this path of rising interest rates, then some of the other worries in the market all of a sudden gain a heavier weight because we'll know interest rates are rising as

we're unsure about whether inflationary tariffs will go into effect. i mean, do you see that maybe this is a different context that we're living in right now versus a month ago? >> i do think it's somewhat different in a sense that our expectations are for modest wage growth in general. the only time you see large wage growth in the united states has been at the beginning of the year with the adjustment of the federal minimum wage otherwise, relatively benign the story then becomes are we going to see a large amount of job growth and the possibility of a third rate hike i don't think tomorrow will be declarative in any case. from an investor's standpoint, what we should be looking at is are we going back to a time of normal market volatility, and i think the answer is yes, and do we have something to look forward to supplant any of these fears. our view is that clients should be globalizing their equity portfolio, and not being spooked by sort of the month to month variations in unemployment at

this point we're talking about two or three rate hikes that will become clear, but what's going to override this is really the earnings story for the first two quarters of this year >> i want to just make a point here that's there's a misalignment between what the fed thinks is inflationary wage growth and the market does the fed believes anything between 3% and 4% is not inflationary you take your productivity, your inflation, you add them together if wages keep pace with those two numbers, that is not, per se, inflationary that's just wage growth. what i hate is the way the semantics, at least on wall street, spatial on this channel, have change said we don't use wage growth anymore. we say wage inflation. we skip over the process that wages can grow in a noninflationary way. i think people need to look at those numbers. 3% or 4% for a few months would not be an inflationary indicator. >> we have been stuck sub.3%, that any sign of inching closer - >> that's true >> also stuck in low inflation >> i think we're hyperabout

inflation around here. >> inflation is really quite benign when you look at it in the context, you know, quarter over quarter and we are seeing real growth. and to the point that was just made, the fact is if consumers actually can get more real wage growth, they're going to spend more, which is going to buoy the u.s. economy for the next 12 to 24 months, something that will keep the earnings story present and dominant over the course of the next year. >> final word, bob >> inflation has been pretty dormant. one thing people haven't looked at that we should pay more attention to it is the fact we have these pmi indices released, today you have the global ones, asia, europe things have been slowing down. three declines in a row in retail sales they're looking at the tax cuts, what to expect, but the consumer has been stimulated several times in this cycle and come up flat declining oil prices didn't give you the stimulus you thought

obama had a hard time getting his stimulus to work there are a lot of ways in which consumers have disappointed us and right now, there's a cooling aspect to the global economy, not just the u.s i don't think we know. >> okay. we'll leave it with that note of uncertainty. thanks, guys sdeev, bob, dan. >> thank you >> straight ahead on "power lunch," legendary investor and founder of the vanguard group, jack bogle will join us. we'll talk trade and much more >> plus, president trump in west virginia talking tax reform, this as the republicans push to make the 2017 individual tax cuts permanent we'll take you there live. lots more "power lunch" still ahead.

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between drastic swings on the dow, a trade war brewing in washington, and a rising rate environment, it's a wild time. we have jack bogle with us to help us make sense of it all great to see you, as always. >> nice to be with you once again. >> i want to start off with something fairly spifrk, but it goes to market structure and what we have seen in terms of volatility in recent days and weeks. that is facebook facebook had a problem facebook shares sold off and then we had a bout of market volatility when i take a look at facebook and how it's held in the marketplace, 103 etfs have facebook in the top 15 holdings.

235 etfs have exposure to facebook are we at the point in terms of the etf-ization of the markets where this has an impact on market volatility? >> well, i'm going to guess, we don't really know, but i'm going to guess the answer to that is no when you look at these halt stocks, the great big stocks out there, and the mutual fund industry active managers, own exactly the same amount of portion of the company as the passive or indexing managers there's not much difference. the passive managers should be buying and holding if they're in traditional funds. so the issue comes out on the etfs, what are they doing? and so far, what we have seen in this area is that people are trading facebook but they're hanging on to their etf that has facebook in it, so the etf shouldn't be greatly affected.

>> jack, i'm not highlighting your age here, i'm highlighting your wisdom. but we have had seven or eight 2% moves, maybe up to ten by now in the first quarter of the year last year, we had zero 2% moves. i mean, the change in volatility has been dramatic. for the new person to the markets, for the novice viewers, you have told us numerous times in the past, you have been through, i think, two 25% or 50% declines in your life. you know how many 25% corrections you have been through, 10% corrections, et cetera what words of wisdom do you have for people who are looking and saying, oh, my gosh. what have i gotten into? >> i used this quotation from shakespeare before the daily emotions of the market are like a tale told by an idiot. full of sound and fury, signifying nothing i mean, this trading, this volatility look, interest to speculators, but it's not interest, of

interest to long-term investors. one of the things that's happened in our mutual fund world is we had more and more speculators using etfs, exchange traded funds to buy, to participate in the market. these exchange traded funds are now, i think, around 40% or even 50% of the market's valuation. total stock market valuation and they turn over with a fury, maybe 2,000, 3,000 percent a year where people don't seem to pay much attention to this, where the typical stock, common stock on the big board, or nasdaq, wherever it might be, turns over at about 180% to 200% a year we have a trading mentality that should not disturb long-term investors. >> that sounded like an indictment of etfs was it >> well, i don't need to indict anybody, but i can tell you we know for a fact people don't want to talk about it, but for a fact, that etf investors have earned about a 5% return inthe

last 12 years. and investors in the market or in traditional index funds have earned about an 8% annual return the gap over that time period means that the traditional index fund investors have earned about 180% on their money, and the etf investors have earned about 100% that's 80 percentage point in 12 years. that's not a good game a good game for the sellers and not a good game for the buyers >> it makes me think, we were having a conversation about fed policy, the changing economy, what happens if the fed has to raise interest rates faster than the market expects something that jamie dimon we warned about letter today. what would happen given that we're in a different structure if that happened quickly >> well, the traders would go wild they always do but don't forget this really

important fact everybody forgets all the time and that's when all of these people look at some future forecast of let's say interest rates or inflation, and sell, somebody else is buying. there's no such thing as a sale without a buyer. so it's very hard to cut through all of this and see what the patterns of the market are doing. i have never seen a market this volatile to this extent in my career now, that's only 66 years, so i shouldn't make too much about it but you're right two 50% declines i have seen a 25% decline in one day. and i have never seen anything like this before and i still think it's noise >> you're still not worried? it's a dramatic statement. you have been in the market for 66 years i'm going to say that's actually a long time, and you have never seen this level of volatility. that's a very big statement. you're not worried >> well, i don't like the volatility because volatility just changes

stocks go from hand a to hand b, from buyer to seller to seller to buyer and i think sometimes it concerns the true long-term investors. the investors in traditional index funds like the s&p 500 and the total stock market fund, the two big ones at vanguard, it disturbs the investors because they see this and think it's significant. if it's significant to them, and they panic in a big market decline and get out, they're the losers i mean, i have said it before and i'll say it again. you heard it before. stay the course is the advice i give to investors. >> is the market going through a phasevolatili volatility, or do you think this is permanent >> in the stock market, there is nothing that is permanent. we will go back and forth from volatility to passivity, and the vix, which happens to be something i don't really want to have anything to do with, will reflect these crazy changes from

one type of market to another. >> did the increased trade tensions between the u.s. and china make you nervous about this market? >> yes, even more broadly than that for years, ever since the new administration came in, i thought one of the underrated risks in the market was a global trade war. and in saying that for a long time, it has not appeared until very recently. but if you read the tweets from the white house, you'll know we're in a trade war if action follows words. now, with all due respect to the present administration, there are a lot more words than actions. >> all right, jack, we're going to leave it there. thanks so much for your wiz dam on a day like today. jack bogle >> always great to have him, isn't it >> straight ahead, house republicans gearing up for a major push to make the 2017 tax cuts permanent plus, speaking of taxes, we're awaiting president trump and his roundtable on tax

reform we'll take you there live. stay with "power lunch." i am an independent financial advisor. i left a traditional brokerage firm because i wanted to be free of their constraints. at my firm, i act in the best interests of my clients. i can tell them i'm supported by one of the world's strongest, most admired financial firms. fewer constraints, the freedom to do what's best for my clients. that's why i'm independent. charles schwab is proud to support more independent financial advisors and their clients than anyone else. visit findyourindependentadvisor.com

president trump in what sulfur springs, west virginia,

holding a roundtable on tax reform >> you're very, very special people, that i can tell you. thank you. nice hat look at that beautiful hat i want to thank jim and attorney general patrick morrissey, and senator shelly moore caputo. congressman jenkins. alex moony, david mckinley for being here today they're all here thank you very much. thank you. so now, once again, you see that america is open for business the numbers are fantastic. the results are really incredible, what's happening we're being talked about all over the world one of the big things is our tax cuts you know, they used to call it tax reform for 40 years, they couldn't pass anything, and they didn't know why. i said how is it hard to pass

tax cuts turned out it was not that hard. it was not easy. but we changed the name. i said, because being a person that's only been doing this for two and a half years, i said, don't use the word reform. use the word tax cut because when you talk about tax reform, that could mean your taxes are going up and your taxes went down they went down a lot and i always tell the republican politicians, because the democrats have a problem, i mean, if you look at your senator, he voted against -- joe, he voted against. no, it was bad i thought he would be helpful because he talks, grabs me i grab him says hello, i say hello. but he votes against everything. and he voted against our tax cuts, and he also voted against medical help and health care and that's bad and we can't have it so you know, it's one of those

things he does other things i don't like, i'll be honest with you. he does other things so you're going to have a chance -- [ applause ] you're going to have a chance to get a senator that's going to vote our program, that's going to help you in so many different ways and you're not getting that help right now. we had -- we didn't get one democrat vote for tax cuts and when you think about it, it was more than tax cuts because we got rid of the individual manda mandate. when you get rid of the individual mandate, that was a disaster that was the most unpopular aspect of obamacare. this is where you have the privilege of paying a lot of money in order not to have to pay for health care, right that's not too good. and we got it out in our tax cut plan and we also got anwar, energy, big energy i'm into the world of energy, as you know and nobody does it better than you folks. so it's very important to me

but it's really great to be here we're going to have a discussion on how to get the country moving even more so you probably saw that for many years, no president wanted to go against china economically, and we're going to do it we had a trade deficit of almost $500 billion last year with china. and i have great respect for the president of china, president xi, he's a friend of mine. and i'm a friend of his. i like him a lot, but he's representing china, and i'm representing the united states of america and it was time that we did something. we can't continue to have -- i spoke with jim just coming in, and jim is a great businessman and he said, you're right. we can't continue to allow this to happen. where hundreds of billions of dollars is taken out of our country and our system, where if they make a car, they sell it

here, it's 2.5% tax. if we make a car and try to get it into china, number one, they won't take it. but if they did, it's 25% tax. so they pay 2.5%, we pay 25% they don't even want to take it. that doesn't sound so good but it's all like that and we have our intellectual property and a lot of people don't understand what that means. and it doesn't matter if you understand it or not, you understand the concept of being taken advantage of wrrbs and we can't be taken advantage of any longer so we're at a point where we had to do this our economy is strong. our jobs are great we're going to come out with numbers on friday that hopefully are going to be fantastic numbers. companies are doing really well. and you have to go after the people that aren't treating you right. and in many respects, i think we'll have a fantastic relationship, long-term, with china, but we have to get this straightened out

we have to have some balance that goes for other countries and goes for other places, if you look at the european union, it's very solidly against us in terms of trade it's very unfair look, a young girl shaking her head yes you know about the european uni union? we almost can't do business. they send their cars over here they send everything over here they don't want to take our product. so we can't let that happen. do we agree with that? we can't let that happen we're working very hard on nafta, with mexico and canada. and, you know, we'll have something, i think, fairly soon. i told my people, oh, i want it, we're making a trip next week to peru, representing all of south america and different places, and it will be very interesting, but they said, oh, let's have nafta before i said, don't rush it. take it nice and easy. no rush. we get it done right, or we'll

terminate. if we don't have it done right, we'll terminate. when i was running, i said we'll terminate nafta or we'll renegotiate it, and mexico has been pretty good they were very good to us yesterday because, you know, they had the caravan of thousands of people coming up from honduras. thousands of people, and we have weak laws because of the democrats and joe. i mean, joe manchin, he's really not helped us on this stuff. so we had very, very weak laws we have the worst laws you think catch and release, which we're terminating very quickly. we're doing it in pieces no, it's unbelievable. think of this. so we have a country where if they step one foot, not two feet, if one foot hits our country, we have to take those people gently, register them and then release them. okay, we're going to release them, essentially in a short

period of time we release them. then they're supposed to come back for a court case. we hire more judges, we're trying to hire thousands of judges no other country in the world does that. we hire judges so that these people will come back. now, they're on the land we release them. they go someplace into our country. they're supposed to come back within two or three years for a court case but nobody ever comes back it's bad enough to say come back in three years, but nobody comes back anyway. this is our country. if you have a baby on our land, congratulations, that baby is a united states citizen. we're the only one now, mexico has very tough policies they can do whatever they want which is the way it should be, to be honest you are violating something very sacred you're violating a border. canada, very, very tough very, very tough and canada is very merit-based you come into canada, it's got

to be based on merit with us, it's a lottery system pick them out. a lottery system you can imagine what those countries put into the system. they're not putting their good ones, and remember my opening remarks at trump tower when i opened, everybody said, oh, he was so tough and i used to word rape. and yesterday it came out where this journey coming up, women are raped at levels that nobody has ever seen before they don't want to mention that. so we have to change our laws. and the democrats, what they're doing is just, it's insanity i don't -- nobody understands what's going on. so we have to have strong borders. we're going to have the wall we have already started building it we have $1.6 billion, and we have started fixing it and fixing miles and miles of wall that's already up and fence. we're going to have our wall, and we're going to get it very strongly the military is going to be building some of it. but we're going to have strong borders. we have to change our laws,

we're working on doing that. believe it or not, if you look in california and you see what's happening, it's an incredible phenomenon, because sanctuary cities, the worst. it's basically a city to protect a lot of people that are bad people really bad you look at kate steinle, so many other things that have happened in our country. and they're protected. how about the mayor of oakland where she tells 1,000 people to get going, law enforcement is coming to get you. and this was all planned and many of them scattered and it was pretty much a failure. i mean, to me, that's obstruction of justice and something should happen there. and it hasn't. i don't know why it hasn't, but something should happen there. so we're toughening up at the border we'll be, i think, in great shape. i think over the next twefrbl months, we'll have a lot of things happening we cannot let people enter our country, we have no idea who they are, what they do, where

they came from we have no idea what their records are. we don't know if they're murderers, if they're killers, if they're ms-13, we're throwing them out by the hundreds you know, we've gone into towns in long island where we have taken ms-13 and we have actually liberated towns. this is our country, right i grew up in long island, right short of long island and these are great towns. i know every one of them and they were taken over by thugs. they talk about guns they didn't want to use guns they use knives because it's much more painful. >> ptd pt. in west virginia. we're going to keep monitoring this we tuned in because it's a tax roundtable they were going to show families who benefits from the tax cuts this is the president's fourth trip to west virginia since he won the election they voted for him by nearly 70%. when we hear more about taxes, we'll get back to that let's bring in douglas holtz

eakin, and also ben white, politico's chief economic correspondent and a cnbc contributor. jebtalmen, good to have you here >> doug, let me start with you do you believe the softening of the rhetoric that we have heard in the last day or so from people like larry kudlow who is so good at messaging we all know that he's famous for drill, baby, drill, et cetera and now he's saying that don't worry about this china situation. there's a pot of gold at the end of the rainbow here. and things are ultimately going to work out. you know all these characters. do you believe that? >> i think the administration is trying to have it both ways. the president is saying we're going to be tough. we're going to put these tariffs on china, get them to change their behavior they have been cheating for years. and at the same time, they want to say hey, don't worry about the tariffs, we probably won't even do them i don't think you can have them

both ways. while i admire the fact they identified chiba as the culprit, i have a question about the execution and strategy and whether it will work >> i think that's the big question, larry can talk a good game about how some of this stuff won't go into play, this is negotiating tactic, we have 60 days or whatever it is. i'm not so sure the chinese side understands that and they're going to move ahead with tariffs. they said they're going to move ahead with them in products in a lot of red states. they want to do this as a negotiating strategy that will get concessions from china i'm not sure, as doug says, that it's going to play out that way. >> do you sense larry had an impact on peter navarro? >> absolutely. i think, i talked to larry last night. he's had a number of conversations with him where they're trying to meet in the middle and he's trying to convince navarro, we need to talk about this as a growth policy that's going to help wages, going to help u.s. jobs and don't rattle the saber in ways that, a, anger the chinese

to immediately put on tariffs, and b, scare the market. there's an effort on the part of larry to try to bring peter and wilbur ross to heal a little bit and get them to talk about >> what's that line in the sand in terms of not angering the chinese? every reaction we have had from any sort of official related to trade or who have any role in this from china is that they're not going to be forced into doing anything that china has never been forced and has never surrendered to a trade war before the state publication, people's daily, came out with very, very belligerent words. they said the tariffs will cost the u.s. very dearly at what point do we say, maybe we're going about this the wrong way? >> so one of the other things that larry kudlow has been saying is we need to build a coalition of countries that think like us and use that coalition to get the chinese to behave more appropriately in international trade. well, i think that's exactly right. that was the strategy called the

transpacific partnership the administration put that aside. i think he has a lot of work to do to get everyone on the same page >> not only that, he just went after the european union in his remarks that were supposed to be on taxes and trade and he also said don't rush a nafta deal >> who's in the coalition, no one? >> the coalition is against us >> a coalition of one. >> go ahead. >> one more thing. they like to think that the president's the best negotiator and that this is all great negotiation tactics. the problem is they set up the jumping off point is shrinking the deficit. navarro gets that wrong, the president gets that wrong, and it doesn't matter how good you are as a negotiator, you're aiming at the wrong thing. >> doug, every economist, every day comes on and complains about that can i just put one asterisk on the tpp. no matter who won the election, tpp wasn't happening so people get upset about him getting out of the tpp it was an easy win for him because congress wasn't going to go for it. >> there was a fantasy that

hillary would change her mind and resurrect tpp. that probably is a fantasy, but can we talk about the rally, i'll calling it a rally. >> because it feels like one >> it's supposed to be a tax reform event it's a perfect inkamsilation of why republicans are worried about trump. they want him talking about the tax bill, about growth and wages and jobs he did some of that, but then he went off on a rift on mexicans and rapists and all this stuff that plays to his base, maybe in west virginia that's okay, but not as good in other states. >> he talked more about joe manchin than taxes on the tax issue, if he's not going to talk about it, we can can they make these tax cuts permanent? >> that's not going to get through the u.s. senate. that's not a realistic possibility. but the house of representatives wants to make the point that, a, the individual cuts should be permanent, and b, democrats are likely to vote against them. i think we'll see that happen. i think if you're going to take that vote, the best way to do it is to also do it in the context of base broadening or cutting

spending so you make the point you still have principles on the fiscal side. we'll see how it plays out i think that's what's going on >> we'll continue to monitor the president's remarks. thank you. doug and ben >> maybe he's gone to taxes. any time now >> straight ahead, president and founder of the eurasia group joining us to talk trade, tariffs, and president trump pretty pvati cmes t roukveomntou of him this week - i love my grandma. - anncr: as you grow older, your brain naturally begins to change which may cause trouble with recall.

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president trump's top economic advisers walking back the threat of a trade war with china, with some hinting that it could all be resolved at the bargaining table yet another move on the chess board many didn't see coming does the president's spontaneity and willingness to take risks help or hurt in the diplomatic front or will all of the policy flip-flops eventually backfire let's hear from ian bremmer. good to talk to you. your comments this week piqued our interest actually describing president trump's foreign policy wins. do you see this current trade strategy as eventually playing out and becoming successful? >> some of it will

i mean, let's keep in mind, first of all, that the united states remains the world's only true superpower. you know, you look at our energy capabilities, look at the size of our economy, the reserve status of our dollar the impact of our military it's not as if we're in decline, so if you have a president that's willing to break some things or say he's willing to break some things and push other countries around, whether or not those countries like it, they don't want to get into a fight with the united states and they are willing to let the president put a few points on the board. i think that's true with south korea, for example where the new trade deal, bilateral trade deal that i expect will be inked between the two sides is an improvement for the united states in a bunch of sectors, pharmaceutical, automotive trucking, maybe a deal on currency as well or at least working bilateral arrangements for working more effectively together than what we had before. and i think you have to give

trump credit for that. >> i don't think anybody disputes the fact that the u.s. is the world's superpower and we're not in it klein. the question is, china has risen so far so fast, and it's become such a major power player on the manufacturing and trade front, will it attract other nations to it against the united states is it too powerful to wage this trade war with the u.s.? >> so steve bannon's perspective before he was ousted as the chief strategist for trump was that china is going to be confrontational towards the u.s. going forward. and if you want to hit them, you hit them early when they're weaker than later. the problem i see with -- and by the way, when you talk to people around trump, either inside the administration or republicans outside, a lot of them are loathe to rip up nafta they're loathe to hit our allies, but a lot of them really do want to hit china the challenges are that if you

do that, you want to hit the chinese with your allies so in other words, getting rid of the transpacific partnership, not the easiest way to get your allies onboard to gang up on china. you know, you want to have your allies feel like -- in other words, you want to have both a big stick and a big carrot the size of trump's stick is a little smaller because a lot of american allies are saying, we don't know if we can count on the united states long term. do we really want to align with them look at the french president, macron, who is saying facebook and google are as much of a threat to france as chinese social media and a.i. companies. that's objectively ludicrous you want the french on america's side >> you probably have good insight into this, what i'm confused about is actually, the eu has slapped very high tariffs on chinese steel, very recently, as high as 75% and there hasn't been the near

huen cry we have seen when the united states has gotten tough on trade did they do it differently i mean, can we learn anything from that? or is it just, they're just not as economically important so it doesn't matter as much >> no, it's not that they're not economically important >> i get that, but not as important as we are, as one sole entities, to your superpower point? >> that's certainly true the potential pain point of the americans and chinese getting involved in a trade war, and we're not in a trade war everyone is talking about this all we're doing is posturing i think that it was good that trump's advisers have dialed that back in the last 24 hours but if we see the policies that the americans and chinese are talking about actually become implemented as policy, this is the two most important economies in the world, the most important bilateral relationship in the world becoming much more dangerous. i think the impact on the global economy, the impact for geopolitical stability is clearly much greater if that goes badly also, because trump is himself

seemed to be such -- so much more erratic, potentially, as an individual actor very different from the europeans who are bureaucrats. >> what about the tariffs on th. >> i think the americans and europeans do see the chinese as truly problematic in issues of dumping and anti-competitive behavior the lack of rule of law, the support for a state-owned enterprise and entities. that's why it's so painful that the americans and europeans are not coordinating on this, vis-a-vis china. that's what you want america first is a perfectly workable strategy for the united states if it is strategic and long-term and multilateral unfortunately, that's the piece trump doesn't seem to find very viable it's much more transactional and short-term and that throws a lot of our allies under the bus. >> he's very much go it alone. thanks for calling in.

ian bremer, president of the urasia group. oil holds at the $60 lelev are there opportunities get into the sector now this is your new name. this is your new house. and a perfectly inconspicuous suv. you must become invisible. [hero] i'll take my chances.

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time for tradingnation.cnbc.com let's take a look at energy leading the market the energy sector one of three positive sectors s&p sectors over the past month. crude oil has managed to hold above the $60 barrel level let's bring in mark tepper, strategic wealth parntners, bors with pk management assets. boris, what do you think about energy here? >> energy is up for three reasons. number one, macro background is positive because demand is really firm. the regulatory environment in the u.s. is actually very favorable and investors are clearly responding to that finally, at this point, the idea that -- oh, my god i forgot my third point. >> that's very rick perry. >> cheap valuation right, right at this point with very strong yields and the fact they were so cheap for so long, the market is

really plowing on mean reversion basis. everything is going to stay this way for the next couple of months so, i don't see energy really doing poorly i think it's still a very good bet. it's basically a story of buy for the yield and stay for the possible capital gains. >> mark, you're overweight >> yeah, high conviction overweight on the whole sector really over the last five years, the narrative on energy stocks has just been ugly energy prices couldn't sustain a rally. because of that, stock prices have suffered. things finally look different. there's strong global growth, good supply and demand fundamentals and that's kept a solid floor under oil prices which right now are around three-year highs but the most surprising part of this rally in oil prices is that energy stocks haven't done anything they've lagged which means there's significant upside potential over the last year, oil is up like 20 year over year and the sle is slightly up with pricing power being the

strongest we've seen it in this decade, we really, really like the energy sector and eventually stock prices are going to have to catch up. >> mark and boris, appreciate your insights. for more market insights, you adgnhead to our website, trination.cnbc.com check, please, is next at ally, we're doing digital financial services right. but if that's not enough, we have more than 8000 allys looking out for one thing: you. call in the next ten minutes... and if that's not enough, we'll look after your every dollar. put down the phone. and if that's not enough,

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but i'm not standing still... and with godaddy, i've made my ideas real. ♪ i made my own way, now it's time to make yours. ♪ everything is working, just like it should ♪ check, please. >> something we didn't get to. watershed moment in latin america. the former president of brazil,

da silva, is going to prison, even as he tries to see if he can get out on appeal. that's a big clean-up in corruption that's happened in brazil one reason that stock market has rallied over the last couple of years. this is unbelievable to see a guy who was so popular actually going to prison. >> and the market responds to some of these political developments i'm watching the trade deficit it's an economic number we don't often talk about it's not the sexiest right now it's so politically sensitive, and we did get the latest figures out from the month of february, i believe 9 1/2-year high for the trade deficit, which we know president trump and the administration want to shrink it keeps growing because we're importing more stuff and exporting more stuff because - >> american consumers are in better shape. >> you can buy things. >> numerous economistshave com on and said as the economy improves, the trade deficit will get bigger and bigger. >> it happened over time. >> and yet they want it to get smaller. >> i'm pointing out tesla right now because as much as we are talking about it going bankrupt and not being able to capital

raise, it's up 54% from the 52-week high which was april 3rd. today is april 5th tune into "fast money" tonight the ceo of coinbase will join us he has a major announcement to make thanks for watching "power". >> "closing bell" starts right now. ♪ >> hi, everybody, live from the new york stock exchange. welcome to the "closing bell." i'm kelly evans. >> i'm wilfred frost good afternoon the market climbing fast and furious. at today's session high the dow gained 1,000 points from yesterday's lows over 30 hours ago. >> kind of echoes what melissa was saying about tesla's stock and the turn-around there. all three major averages up 3% since monday's low we're over the market action as we head into the close