banks out there. it's really been hurt. long time, it'll be fine. >> i'll go with citi bank. it has to bounce back. >> jim >> intel very cheap soon, they'll have a new ceo which should be a catalyst. >> u.s. bank usb. >> great that does it for us. this special edition of the "halftime report" honoring our veterans, honoring our heros thank you so much for being here thank you, all of you, for your service. [ applause ] i'm melissa lee. here's the menu. the markets reversal stocks falling after a big weekly rally was the market overbought, or is this a one-day blip? oil is doing something it hasn't in 35 years and it could have an impact on the economy. plus, we'll debate the fda's bold plan to restrict the sale of flavored ecigarettes. going once, going twice, sold we'll go inside the most expensive house ever put up for

auction. "ho "power lunch" starts right now >> welcome, everybody, to "power lunch. what a wonderful program that was on "fast money halftime. a great tribute to our servicemen and women welcome, everybody i'm tyler mathisen stocks moving lower and on pace for the worst day of the month the month is young, folks. it's the second straight down day for the s&p 500 and the nasdaq, at least as of now it'd be the first in five for the dow if we close on the red side oil, a big mover, down for a tenth straight day slipping further into bear market territory tech, materials, communication services, they're the worst performing sectors right now consumer staples is leading. everybody needs paper product, paper towels and that kind of stuff. movers today, activision blizzard calling yesterday yelp sinking as revenue was

short of estimates dropbox moving higher. the company gave upbeat guidance let's send it to dom with a look at where we stand following this year's rally, until today. >> up tun till toduntil today. four-day winning streak. if you look at the dow industrials, it's been a fairly weaker move to the sessions lows you can see, we've been trending lower for most of the session. now, a hair above where we were at the lows of the day if you take a look for the week, like i said before, a four-day winning streak heading into this right now, and you can generally see a nice move higher trend wise maybe a little bit of a rollover here we'll see if it sticks down 1% in the trade today we'll see if it stays for the week remember, on a year-to-date basis, we are trying to find our direction here we're moving to the upside remember the move lower from the highs? we were losing 10% for the dow overall. we've gotten back around 7% here

is this the turnaround we're waiting for? could it be something where at least the bulls take over? right now, doesn't look so good. dow and s&p 500 are on track for the biggest one-day loss so far going back for a while we're looking at that, tyler back to you. >> thank you very much the dow, the s&p 500 and nasdaq on track for the biggest one-day loss of november as we mentioned a moment ago, november is pretty young is this just a blimp in the rally since the october sell-off, or is it something more troubling joining us, chief investment officer at people's united advisers, and bill stone, co-chief investment officer at avalon advisers. welcome to both of you you think that equities will do well and, therefore, you want to overweight them. what gives you such confidence and hopefulness? >> we're overweight equities, as you said, and we actually think, you know, post the election, we think a lot of uncertainty will be removed from the markets. we're actually looking between now and year end for a good market more importantly, we actually

think we're going to have a good year next year you know, i think the market will probably like some gridlock next year. we're positive on the year end, but we're positive on next year and a lot of the activity in washington, we think, will help. >> what uncertainty has been removed since tuesday, other than the fact that we know now that the democrats will hold the house and the republicans, the senate >> well, there was a wide divergence in policy president trump was talking about an additional 10% tax cut. the democrats had many, many policies the repeal of the aca, the affordable care act, we think is now off the table. that uncertainty with regard to health care stocks is out of the way. the further fiscal stimulus, if we did get the additional 10% tax cut, that could have put more pressure on the fed you'll see less pressure on the fed, which we think will be a positive for next year. >> we have the top ppi number

from this morning, bill stone. what does it tell you, whenever we have sharp selloffs, it seems technology bears the brunt of the losses does that signal something, about how investors, the markets are seeing economic growth, seeing leadership in this market going forward? >> it could be some of it. i think you're right in terms of technology at the moment, it is lumped in a lot of the other cyclicals i think technology, in and of itself, you know, it's been on multi-year tear or higher. i think some of that is a bit of the fact that they got, in expe relative to other places they are suffering a little more of when you lump it together, it is a lot of the more economically sensitive sectors that have born the brunt of some of the turn downs. >> what do you see in terms of growth for next year, bill i ask you that because, as you mentioned, we got the hotter than expected ppi number in part, the market reaction is the thinking that the fed is, you know, perhaps more cemented

to its path of rate hikes in the face of what could be slowing economic growth. >> yeah. i think, you know, obviously, most of us, and certainly the market is pricing in a fed hike here in december we still think, yes, the global economy and the u.s. economy are slowing down a bit at the end of the day, we really don't think you need to be fearful of significant downturn, which is why we'd say, you know, you probably should stay a little more allocated toward some of the more cyclical areas. i think that's probably a place to look. i think mixed up in there, of course, is the oil weakness today. some could be the economic side. i think most people think it is supply, not really the -- that it is an economic weakness you never know for sure until it is done being weak. >> thanks. we appreciate it john traynor with people's united advisers. bill stone with avalon advisers. have a great weekend. >> thank you. >> thank you. >> as the market melted down in october, shares of procter & gamble were a safe place to

high up 11.5% in the last month sarah eisen speaking with the ceo. the stock is a rare bright spot. she joins us from cincinnati, ohio sarah? >> reporter: hi, melissa p&g's performance lately has to be do with the defensive tone in the market, as you mentioned also, p&g is coming off of a blockbuster quarter, where it grew market share in all categories in while -- quite a while. i asked david taylor, c oreo of p&g, if he thinks it can continue into next year at this rate >> certainly, there's no evidence, either unemployment or consumer confidence or any other of the macro factors that would cause me to lose confidence of the u.s. being a great market to do business in right now, it is one of the reasons why we're telling all our category leaders, we need to win in the u.s. >> reporter: i'm in cincinnati

for procter & gamble's investors analyst day. they laid out a whole new change, actually a big shakeup in its organization. now six business units with their own ceos that' they'll be in charge of innovation, bringing products to the consumers. it is something the investors have been calling for. something taylor says is important to do, to keep the strength going the macro economic backdrop they have to deal with as a global company is pretty tough. he said they're dealing with cost inflation, everything from transport costs to commodity costs. that's why they're raising prices, which will come toward the end of the year. the strong dollar chips away at sales. it is a company that gets 60% of its business outside the united states the announcement today is really the next step in a multi-year turnaround, guys, that is starting to bear fruit, that should let p&g be faster, more

nimbler, agile for new products. they showcased some, olay whip and new razors they've really been fighting hard against up-starts like dollar shave club for the past few years. it's hurst tt the growth that's why there is excitement around the stock a lot of the analysts here in cincinnati yesterday writing glowing notes, trying to figure out what the changes actually mean for the targets i saw one upgrade from bernstein this morning. >> it's dom, sarah this idea, we know they have to complete with the smaller rivals that are growing at such a quicker pace than the established brands this idea of eliminating a lot of the units, getting it down to six main operating divisions within procter & gamble. >> reporter: yes. >> what are they saying tant what it could mean for that kind of competition they've since bought up some of the names, right, gillette has, in terms of the shaving side of things what does it mean for the overall business plan? do they want to go after these guys in a much more direct way,

or are they trying to defend themselves >> reporter: they're trying to not get out-disrupted, and disrupt themselves, so they, next time, will anticipate something like a dollar shave club coming around and not losing market share to it. by this new organizational structure, it is, by the way, a huge change for procter & gamble they used to have heads of geographies, heads of individual categories everybody reported up through a matrix organization to headquarters decision making was slow it was complex you'll remember, when nelson peltz waged a proxy war last year, he complained about it, saying that's why they missed out on key consumer trends and weren't fast enough to the market peltz is now on the board. clearly, the company is listening to the shareholders. they're making moves to get out into the market and come up with these newer, faster innovations, so they don't have to worry about slower growth in what is a tough environment. >> newer, faster procter & gamble tanker ship. see if they can turn it.

sarah eisen in cincinnati, ohio. oil on pace for a ten-session losing streak, now in bear market territory what should you be buying in a crude bear market? we'll have the answers coming up next on "power lunch." and we're going to continue, by the way, yesterday's hot debate will the fed hike rates, and will it send the u.s. economy into a recesonsi that and more coming up on "power lunch."

oil prices continuing to be a big story, down for a tenth day in a row, briefly breaking below $60 a barrel for the first time since march jackie deangelis joins us with more. >> good afternoon. under $60, bear market wiping out the year-to-date gains to say oil prices are under pressure is a little bit of an understatement here. i think the five handle, if we can close under $60 in today's session, is going to be a significant level. add even more pressure to the downside the problem right now, we're comfortably -- we're in this rebalancing wave oil prices seem to be finding some footing things got off balance again with the introduction of the iran sanctions their impact ended up being less than expected. got the russians pumping again, the saudis pumping again when they all had finally backed off and announced that opec and non-opec cut then we find out the u.s. production is quicklyfying grav. it is a trick equation that u.s.

producers and counterparts finally started to figure out. none of the producers want the oil prices to be low it is harder to make money none want to give up their market share either. some analysts are saying they're going to push the prices lower again. they're going to feel the pain, then they'll be forced to take the step back again. >> how has positioning been in the pits has it worsened, this move we've been seeing in oil >> absolutely, melissa you have a short squeeze on your hands here you have traders saying that, literally, some funds are puking oil. that's why, i think, the decline was rapid. >> jackie, thanks. >> a federal judge blocked the president's permit for the keystone pipeline. we have reaction from the white house. what is the white house saying about this one >> the president expressing some frustration this morning as he left the white house on the way to paris, for a commemoration of the end of world war i this week late yesterday, a federal judge in montana blocking the

construction of the keystone pipeline, saying no more construction can go forward until they more fully review the environmental impacts of the pipeline saying the trump administration simply disregarded the effects on the environment when they decided to move forward. now, the trump administration could still appeal this decision, but that is still tbd. nonetheless, the president expressing some of the frustration. here's what he said. >> it was a political decision made by a judge. i think it is a disgrace 48,000 jobs. i approved it. it is ready to start they went and i guess they'll go to the ninth circuit, as usual we're slowly putting new judges in the ninth circuit everything goes to the ninth circuit, everything. >> so the president there emphasizing the number of jobs that he believes are being thwarted by the federal judge's decision here. no indication necessarily what the white house's decision is, how they're going to handle this going forward. the president venting a little

bit here to the press on the south lawn. >> his emphasis on the ninth circuit, which is a court in seassa francisco. >> right. >> it was one of the ones that blocked his travel ban last year so the record there has not been favorable to his administration at all, hence his evident aggravation. >> yeah. you saw him talking about putting federal judges in place, now that the republicans maintained control of the united states senate. the president will still be able to do that, despite democrats taking over on the house side. the senate approves the federal judges this president will be able to continue to move forward with more conservative judges he'll get more of the kinds of decisions he likes as the next two years go on. >> eamon, thank you. >> we'll stick with energy ten-day drop for oil is the longest losing streak in 35 years. what's next for the commodity and for the energy sector overall? let's bring in mike kelly with

seaport global securities. i guess the basic question is, mike, we have this glut, oil prices going lower can it keep going lower from here >> well, you know, it can always go lower, but we feel pretty good about where we're at right now, after this pullback there's two things we're watching one is iran, by far, the biggest, most important variable at play now. iran exported 2.6 million barrels a day in april the trump administration said yesterday there is growing international support to put that down to zero. if that happens, we'll have a giant party and invite you guys in texas that would be huge for the oil industry that's the biggest thing, number one. number two, i just heard the segment talking about u.s. production and how it continues to grow. well, growth is kind of like not cool anymore in the u.s. oil and gas space. that's very apparent with q3 earnings the focus is shifting now to free cash flow, high corporate returns. i'm not as fear lful that u.s.

growth is going to wreck the party, like i was a year ago 2 million barrel growth out of the u.s. is possible, i'd say. i don't think it is the playbook now. i'm a little more bullish, especially after this pullback here in the macro side of things. >> mike, the u.s. is how reasserting itself on the world stage for energy the biggest producer out there of oil does that mean that domestic u.s. oriented plays are the way to go when it comes to playing the energy sector if you want to be long in it? >> i think so, absolutely. the permian, the best and brightest out there, it's the growth engine. the one we really love is out in colorado the fine citizens of colorado voted down this proposition 112 on tuesday it would essentially put a frac ban in place anybody with colorado exposure in their company got crushed leading up to this vote. the names haven't recovered appropriately, post getting shot down the names traded two-turn

discount pdce and hpr, high point resources and pdc energy are favorites there. >> we have a huge pop in the colorado names, mike in terms of the global growth support for the oil picture, how confident are you in growth around the world, supporting the global oil market? >> yeah. that's the thing, melissa, i mean, outside of the u.s., there's a handful of companies that could show you decent growth a big question mark on saudi, whether they really have the capacity to ramp up to kind of the 12 million barrel a day mark that they claim. i think it's still yet to be determined >> all right mike kelly, seaport global securiti securities, thank you for that tape on oil. coming up, blue chip stocks moving in opposite directions. there is optimism for disney but not so much about general

electric. all the feng stocks falling. stay with "power lunch."

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we're seeing some of the steepest losses in nafinformati technology down by more than 2% also, communication services, home of the feng stocks, consumer discretionary, materials seeing steep losses. >> speaking of steep losses, shares of ge sinking once again today. the stock barely now above $8 a share. it is down nearly 40% in a month. yes, in a month. one influential analyst thinks it will go even lower. listen to what j. pvjpmorgan's e said, that he'll lower to $6 a share. he has worries, including the industrials business of the company. ge capital and the company's free cash flow ge has already cut the dividend to a penny a share >> so steven tusa has been -- now, you can be bullish or bearish on ge. the market played out the story. the judge, jury and, so far, executioner of ge shares however, the target price he had

was $10 when not a lot of people had a $10 price target on it he was right the fact he's cutting it again, if he is right again, means there could be significant financial crisis downside. what was interesting about the note, it wasn't a liquid fi issis -- liquidity issue. >> the company did respond to a wall street analyst note it tells you the concern they have about how investors are perceiving the liquidity position right now if you look at the cost of ensuring against default of ge bonds, highest level since 2012. definitely something we're watching skeptical. >> $6 share price is what it was in 2009, early. >> almost decade lows now. >> general electric. another blue chip in the news. >> absolutely right. we'll talk about that. that's disney right now. the stock, a rare bright spot in a down market for the overall day. disney reporting better than expected results, thanks in part to the traditional businesses. talking theme parks and the

movie studios. a lot of the focus is on the company's streaming service, which is expected to launch late next year. disney plus. i would say this, netflix i pay for every month. hulu, i pay for every month. you could say you amortize the cost of prime every month. i'd probably buy disney plus. >> you have a child. >> mickey mouse clubhouse is all over the house. >> that's the difference. >> i mean, it'll be interesting to see who comes out on top. there are only so many dollars you'll be willing to pay for the subscriptions. there are at a lot of them do you have satellite radio? will you continue paying prime and so forth people are going to make choices. we'll see. disney has an incredible stable of content they are adding more with fox. >> absolutely. >> stock up almost 2% right now. the fed seems all set to raise rates at the next meeting in december with more rate hikes next year. president trump, jim cramer, and others worry the fed is going

too fast could it crush the economy we'll debate that next. if you have a mega mansion to unload, robert frank will tell you the new way to sell one. >> with so many mansions on the market for years, more and more sellers are turning to auction we'll take you inside this $159 million mega home that's about to go to auction next weekwi, th no reserve after the break.

i'm contessa brewer with your cnbc news update for this hour president trump was speaking to reporters on the white house lawn before leaving for paris. he defended acting attorney general matt whitaker, as the president faced criticism about his appointment to replace jeff sessions >> i don't know matt whitaker. matt whitaker worked for jeff sessions, and he was always extremely highly thought of, and he still is. i didn't know matt whitaker. he worked for attorney general sessions he was very, very highly thought of the supreme court says

85-year-old justice ruth bader ginsburg is home after being released from the hospital she'd been admitted for treatment and observation after fracturing three ribs in a fall. a spokesperson says she's doing well she's working from home. apparently, there is a rabid market for thanksgiving in a can. pringles sold out of the holiday themed chips in 41 minutes the three-pack, stackable mini cans were priced at $14.99 they went on sale online tuesday at 11:59 p.m flavors were turkey, stuffing, and pumpkin pie in a can this particular snack pack did not include, say,mashed potatoes and gravy and cranberry sauce. i have to tell you, if i showed up for thanksgiving at your house, and that was on the menu, i probably wouldn't feel grateful >> i would i like those pringles. i would say this, i've had them before now, they're mass marketed. >> i'd probably like it if i tried it. >> thank you so much for that. let's get a check on the markets. the dow off by 254 points, 1% to

the downside overall, we're down 270 points at the lows of the session nasdaq and s&p, they're down by over 1%. nasdaq down by over 2% right now. that's near their lows right as we speak semiconductor stocks lower across the board micron, qualcomm, losers on the day. fossil down 14%. tiffany, best buy, sharply lower, as well a lot of action, mostly red, melissa. we'll see if it continues in the 2:00 p.m. hour. the future of ecigarettes got hazier fda plans to announce a ban on the ecigaret-cigarettes across e country. it is to curb use by teenagers. juul will stop selling their products in stores could this do more harm than

good let's bring in the executive director of the vapor technology associate, and also dr. john torres, medical correspondent. tony, what is the industry association's response to this i've heard a number of things. first of all, the fda may not have authority to have any sort of control on the distribution points of these products also, that this is really a ban on juul itself, since it is thr 3/4 of the e-cigarette market. >> let's start with whether they have the authority we have to see what they do and how they do it i mean, the process that the fda chooses to use is relevant to the legal analysis until we know exactly what they're planning on doing and how they're planning on doing it, it is difficult to react to that i think that we also have to keep in mind something really important, which is bigger news this week, which is that the cdc and the fda announced that the adult smoking rate has again

declined it is now at the lowest rate ever, down to 14%. it is a historic low when we -- whatever policies the fda is considering, you know, we have consistently said they have to keep the adult smokers squarely in the focus of whatever they do next. what they do next could dramatically impact -- >> are you claiming credit for the decline in smoking amongst adults is the e-cigarette industry claiming credit for that >> i think it is very hard to look at the data and suggest that e-cigarettes have nothing to do with the decline in cigarette smoking. the decline that has dropped now, they said, by 65% since 1965 is dramatic if you look at the actual rate of decline, it is much more aggressive since the time that e-cigarettes have really risen to prominence. i'm sure there are other reasons why cigarette smoking continues to decline education is one of them but the reality is, you cannot

ignore the fact that there is a rise in e-cigarette use, and a corresponding decrease in cigarette smoking. >> dr. torres, explain to us, who don't really follow this industry or know about the products all that well, what it was that juul did that enabled it to command three quarters of the e-cig market by virtue of, i think, from what i understand, selling a pod-like device that delivers a more concentrated dose of nicotine. >> i think you're calling it right there exactly what happened over the last few years. when juul came out with this pod-like device, it looks like a large usb stick. it is easy to hide it has a cool factor high school students say, it is ubiquitous in the high school. children can hide it from teachers and classmates. it is easy for them to use they can hide it from their parents. it's gotten the cool factor. i think that's why, at least at

the teenage ages there, it took over the market and it is one of those things that is proliferating throughout the school systems that's one of the big concerns the fda has. >> i'm told by using one of these devices, you can, in theory, hit the device, if that's the term you would use, less frequently than you would with other devices, and it produces a smaller cloud of vapor. am i right about that, gentlemen? >> well, i've talked to high school students and they say, one, the vapor seems to be smaller. they can take smaller hits the other thing they do is in the middle of class, it looks like a usb stick, they'll inhale the fuels in class when they exhale, they'll pull the shirt up and exhale in there. they can do it even in the classroom itself. >> so i want to turn to you and ask, what percentage of e-cigarette sales take place in convenient stores and gas stations, number one

number two, how do you feel about the idea that the fda may be banning these kinds of flavored vape products but still allowing flavored tobacco products to be sold right off the same shelves, whether they are flavored cherry cigars or menthol cigarettes, whatever seems to be an inconsistency on that. >> you hit the nail on the head, tyler. there is an inconsistency. that is why when you're choosing one mechanism or one pathway by which these products are accessible in the market, and trying to cut that off in favor of other pathways, you run the risk of having serious, unintended consequences. in this case, what essentially -- if they are removing flavored e-cigarette products from convenient stores and gas stations only, they are leaving in place all of the otherbacco products, which teens get access

to and have smoked that is a dangerous probability, especially if your presumption is that it is the mere access, the ability to get to one of these stores that matters. the debate -- >> what percent are sold in those distribution channels? >> well, the problem is, i actually can't tell you the exact percentage what we do know is in the channels is one type of vape products the open system products, predominantly sold in vape shops, are not found as much in convenient stores. that is a very large segment of the market, and it is also a large segment that is important to adult smokers the vape shops -- >> sorry we're running out of time. i just want to ask a basic question here before we go dr. torres, what you said about how these things can be concealed from parents and teachers at schools, et cetera, because the vapor doesn't smell like anything, because it is a smaller cloud.

what if they were made so the vapor did smell, like gasoline, a stove, you know. gasoline naturally doesn't have a smell. they add a smell so you can detect it. >> number one, if you had a smell like that, they'd be less b popular. the smell attracts them to it. these have fruit and bubble gum flavors that are attractive to the teenagers. especially with juul products themselves, they all have nicotine we know the teen brain is very plastic, meaning that it is still forming. it can become more addicted to nicotine, which leads to regular cigarette use, which we know has a lot of problems. >> i'll remember that phrase, the plastic teen brain i have encountered it, man >> there we go. >> amazing. >> you know. >> final thought. >> i think the last thing to note is, you have to be careful. these arguments are shifting rather quickly first, it's the design of the product. then it is the fact that it doesn't smell. before, it was the fact that it smelled too much like fruits

i think there's a lot of excuses that are being made. the reality is, we have to keep these products out of the hands of kids. if the fda is considering pushing the products into vape shops, allowing flavored sales in vape shops, we know within our trade association, our vape shops are exceptionally strong they age gate the stores they card heavily. they talk to the consumer about the products those shops are in every state, like new york, like texas. >> that's why this would not pertain to the vape shops and would be other outlets we have to leave it there. thank you very much. nbc's dr. john torres. wed yesterday on "power lun there was a bold and bearish call listen. >> we are setting the stage for a recession to come within the next 12 to 18 months that's very much the case. i think they are doing it partly because the fed has ignored global realities the fact that the chinese development with respect to

debt, with respect to the trade car, are going to have a much bigger impact on 2019 than the fed anticipates. >> is he right could the fed potentially push the country into recession let's bring in cathy, oxford exnomic diree economic director services, and the chief strategist for hilton capital. dick, i'll start with you. do you think sri kumar has a point to make here, as the fed tries to find this ephemeral, neutral rate for interest rates? >> i think he has an excellent point. i think there is no such thing as a neutral rate. if you take a look at the fed funds rate the last ten years, it's averaged 38 basis points. if you look at it since the beginning of this century, the year 2000, it's averaged 171 basis points if you look at it from the beginning of time, 1954, it averaged 480 basis points. there is no such thing as this

rate -- this ephemeral rate they're talking about. i have no idea who came up with it the key point is, if you're running an economy at 38 basis points for ten years, and you jump the rate five-fold, which is what has happened, to assume that all of the people who finance the trillions of dollars that were financed at this lower rate can automatically adjust to the higher rate, without any negative consequences, is, i think, a major mistake. >> all right. >> in addition to that -- sorry. >> finish your thought. >> if you shrink the growth and money supply, roughly 6.7% since the beginning of the scentury to 3.8%, you're doing too things. one, you're taking money away. two, you're making the money that is available very expensive on a relative basis, and that's a very negative thing. >> the numbers you cited were the growth in the money supply, right, is what you're talking about? >> exactly. >> 6.7% to 3.8%. cathy, jump in here. as dom pointed out yesterday, sri is a highly respected

analyst but has leaned toward the more glass half empty side in many cases. >> yeah. i think that it is a good point, even the federal reserve admits they're not really sure where the federneutral fed fund rate s they're go gradually an approach chair powell outlined they'll watch the incoming data and financial measures, as well, to guide them. i think the fact that they're finally getting to a short-term rates that are no longer negative, it is a reflection that we're no longer in a crisis the post-crisis economy is well behind us. you can see that with a number of indicators. the labor market particularly is red hot and has shown no signs of slowing i think the fed is being prudent, taking a little insurance tightening here. maybe a little bit more next year we look for one more rate hike this year and three more next year i don't think that necessarily derails the economy or sends us

into recession we actually see the recession odds rather low, about 20% right now on various measures that we look at. >> cathy, it's dom here. one of the things we want to highlight is this idea that the fed is on a path right now that it sees at least the economy doing okay enough to kind of go through this rate normalization process. what exactly would they have to see, outside of a really bad jobs picture, that would make them get the pause back in their playbook going into 2019 >> well, i think they'll look at various measures you know, key leading indicators and financial market variables, as well. but not one indicator itself will really dictate. they're going to look at the whole swath of readings to try to get a sense of where things are headed right now, the leading indicators we look at, that the federal reserve look at, point to continued, sturdy growth. we have to remember that even if

the economy completely stalled, you're still getting about half a percentage point of injection from fiscal stimulus you can absorb some of the negative impact from tariffs and still, with this domestic economy doing strong, you're still on pace, we think, to get 2.5% growth next year. >> dick, we're basically out of time i'll ask you to put a percentage bet on a recession by the end of next year. >> i'd say 60%. >> 60% dick, thank you very much. always good to see you cathy with oxnard economics. dick is with hilton capital management thanks, guys. >> thank you. let's take this conversation to the bond market rick santelli tracking the action at the cme group in chicago. >> if you look at the two day of two years, it looks pretty downsidish rates have dropped, prices have gone up. one week, down four on the day, we're still up two on the week,

which is common on the short maturities the long end, you look at a chart of ten years since the end of september, we have a double top at 223, down five on the day, two on the week dollar index having a stellar week, as you see on this chart we are close to the 97 handle, which would mean we're close to testing levels once again that we haven't seen since june of 2017 tyler? back to you. >> richard, thank you very much. i assume his name was richard. coming up, the cracks are getting bigger in the luxury real estate market frank is live at the most expensive mansion to ever hit the block. robert >> tyler, the market is being flooded with mega mansions the prices sitting on the market for years. this one and many others are headed to the auction block. we will tell you what this could sell for and what it was pcerid at when "power lunch" returns after this break alerts -- wouldn't you like one from the market

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usually, selling luxury real estate takes time. you have to find the right buyer willing to pay your asking price. one homeowner in florida is tired of waiting robert frank is at an amazing house that could be the most expensive home ever sold at auction. robert >> reporter: hey, melissa. turns out, a lot of owners are tired of waiting to sell this home, four years ago, was listed as the most expensive home for sale in america, listed at $138 million. next week, it will sell for auction for no reserve, meaning there is no minimum bid. the number of these multi-million dollar mega homes headed to auction more than doubled over the last year that is because there is a giant over supply of the hyperhomes on the market for years if you look at real estate auctions of the past, we're talking about distressed real

estate or foreclosures now, even the most expensive homes are headed under the hammer >> when sellers call us, number one, they're motivated they want the property to sell that's why they're calling an auction company, to help create the sale within an company to accelerate that sale in a time frame. but number two they want the price. these are smart people, they earned these properties -- >> reporter: often that price is lower than the sellers expect. outside of los angeles, there was a home that was listed for $53 million, had a vast underground complex of a tennis court, spa it sold for $23 million, less than half the price. and peter lynch, the investor from the 80s, he knows how to buy and sell, he's putting his arizona golf home on the market that's been around for $14 million. but this is the king of all real estate auctions. it is 58,000 square feet and it

has 500 feet of ocean frontage, a 20-car garage, 3,000 bottle wine cellular, 11 bedrooms, 22 bathrooms. it's got not one but two private yacht docks. the bidding starts next monday online at consigliere auctions.com, goes through tuesday for a live auction, but in order to be a bidder for this home you have to wire $250,000, which you get back if you don't win. >> that's more than the 100 bucks i'd put up for it right now. thank you for those stunning images. president trump hoping tuesday's elections will usher in a new era of bipartisan in washington, that might be a bit of a stretch but is infrastructure one area the president and democrats can make a deal on, if they do, 'rere is the work coming from? wee asking the national association of manufacturers,

that's coming up next on "power lunch. it's not about quantity. it's about quality. no trendy stuff. i want etfs backed by research. is it built for the long-term? my reputation depends on it. flexshares etfs are designed and managed around investor objectives. so you can advise with confidence. before investing, consider the fund's investment objectives, risks, charges and expenses. go to flexshares.com for a prospectus containing this information. read it carefully. a moment of joy.

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welcome back to "power lunch. nows that the elections are over the attention turn's to washington's agenda and our next guest hopes one will be workforce development. let's bring in our next guest, head of the manufacturer's association, jaye it's good to have you on. are we going to get infrastructure done in the next congress >> i'm optimistic about it

you heard candidates talk about the importance of improving america's infrastructure that is good news for the american people and great news for manufacturers. this is a real opportunity for bipartisan cooperation and progress >> i think back, jay, to the shovel ready projects back in the american recovery and reinvestment acts we couldn't find as many workers often times, are we still in that situation now and how do we fix it >> we are. i don't want this to be compared to the shovel-ready projects of the 2009 era what happened in that legislation it turned out to be a complete mess. so much money was going to things other than infrastructure what we need right now is a concerted, focussed investment in infrastructure. and to your point. you and i talked about this, we both have young children, and the real question is where are the workers going to come from we have a big crisis when it comes to filling jobs that need to be filled today. >> how do you fix that

how do you change the educational pair dime so there are more kwum fied workers to work on things like infrastructure because we don't have many right now. >> right it's not an overnight solution if it means changing your educational system that's a minimum of a 12-year runway. there's so many people that have given up or decided they can't be a part of the workforce anymore right now because they think they don't have the skills necessary to do the jobs today that's up to the business sector to train and bring people back to the workforce, working with community colleges, technical schools and other institutions of higher educations or high schools to get folks ready to come out and enter the workforce. >> jay, what is the national association of manufacturers doing itself to promote that agenda. >> it will be veterans day and we are so proud of one of our programs, the heroes make

america program. we are training military personnel who are getting ready to leave the military, leave military service for jobs in manufacturing with some basic skill sets and a lot of those jobs can be translated into the jobs created by infrastructure investment we have 500,000 jobs open today in manufacturing itself. and we want to welcome those folks into the workforce we also are promoting women in manufacturing and working to change the perception of manufacturing by getting young people exposure to manufacturing jobs of today. >> closing that skills gap a key to this u.s. economy. >> it is >> jay timmons thank you very much. >> thank you for having me. coming up disney taking its movies off netflix as it starts its own streaming service but netflix is not taking it lying down, making a big push into children's programming we'll tell you how this turf war is going to play out stay tuned

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so what else is new? humm..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. good afternoon, welcome everybody to hour number two of "power lunch." here's what's on your menu the post election rally hitting a speed bump today, should invest invest ors be concerned we'll look at the sectors that could out perform. and plus the battle for animation domination we'll look at netflix's push to catch up with the big players,

namely disney. the under the radar stock winners from amazon's new proposed headquarters. "power lunch" part deux starts right now. welcome to "power lunch. a down day on wall street as oil prices sink. the dow is on pace to make a winning streak right now we're just a few points off lows on the s&p and the nasdaq and information technology is the sector leading lowing us on the s&p 500 oil the big story today it's fallen for ten straight days into bare market territory the biggest losers, baker j. t hughes, schlumberger, marathon oil. for more on today's markets,

let's go to bertha at the new york stock exchange. >> it's a risk off day we're watching treasuries move higher, the yield lower and technology and communications are the names leading the decline here at the big board. financials are weak as well but consumer staples are what's leading today. making the dow's day an outperformer, a new high for disney rallying on record results pg&e up on its restructuring. sarah had a great interview with the ceo. coke and mcdonalds hitting record highs along with united health and even with the decline, the dow is on pace for its best weekly gain in five months one of the interesting things is the divergence, look at the do you versus the russell 2000. the dow is down, and back in correction down more than 11%

from their highs energy are among the biggest losers dragging small caps lower. when you have large caps making new highs and small caps dragging, it's really seen as a barish divergence for the market overall. >> let's talk about that divergen divergence. before today's drop the dow was up nearly 4% for the week. they point out as of last night the s&p 500 was its most overbought level in a year, at least by one measure so was the post midterm rally a head fake? let's bring in silvia ja blon ask you and ron insana silvia, as we talk about direction your business has exchanged traded fund that is let people bet on the markets on a levered basis, two times the market, three times the market how are you seeing trading

activity tell a story of what's happening at the market right now. >> sure. you used a great word there. our products track essentially direction, the name of our firm is also direction. so in the short-term we had the midterm elections and i think that brought certainty to the market so the gridlock is what was expected from investors. that off the job week of good numbers, positive gdp growth and business sentiment sort of like the post earnings lack of rewards we saw investors going back to the bull funds, the three bea tech, artificial intelligence and health care, which had great earnings prior to today we have seen some of the flows in the bull funds >> so ron, as we talk about the tools that traders use, some of these etfs are them. is there a sense we see in other

parts of the market we might not be as bullish as the trading flow suggested >> yes one of those instances when we started to see the russell 2000 outperform, that's one where they say the soldiers are leading the generals and enthis you see tech fall apart and the housing market has gone down a lot. all of those divergences are important. the immediate response to the midterms was it wasn't as bad as they thought now they're talking about 40 republican seats flipped to democrat, the biggest flip since the watergate period there's the fed, china, all of those things headed for the market >> we've been talking about the three themes that may be the dominant one in 2019 one is what happens on trade, what happens on rates and the third is what

happens when the idea of corporate profit slows from its high levels currently. we have a debate on the possibility, some think are higher, others not, as a recession in 2019. where are you on that? both of you. >> on my side we're cautious and looking at the head winds you mentioned. we expect there to be continued rate hikes but we see a somewhat stable economy a lot of investors and traders are experiencing a risk off attitude they are looking at the head winds and china and expecting some sort of result. if we don't get positive feedback about china tariffs and we have the continued fear of rate hikes continuing perhaps faster than we would like to and growth retracting, i think the market will continue to be volatile and traders will continue to have a risk off sentiment. i think most of the traders we do speak to believe that since

trump came into office the number thrown around was 28% performance of s&p 500 and 18 out of 18 post midterm positive sessions and 12% with a republican president and gridlock house however the growth trend for next year is expected to be less than that 12%. >> wrap it up, ron. >> peter was quoted as saying these international globalists are trying to pressure us to end the tariffs on china, that's not going to happen. at the end of the day we could see a growth slow down in the u.s. and maybe overseas i think the market has to contend with more than we thought third quarter profits up about 27%, stronger than the first and second quarters. comps next year will be -- >> they'll be hard to beat. >> looking at organic growth and the rate of change is going to be important to the market. this year growth has been flat

over the last three quarters >> thank you, both there's a battle brewing -- it's brewing in the clouds and we do not mean in the sky. it is all about the clouds and the cloud computing. more and more companies are betting on that space. a little juul, we're vaping away here ally bah bah, the ceo tells cnbc they aim to make include computing the base of the business our next clash coming up, both vying for a pentagon contract who wins >> since we talk about alibaba, who in their right mind would do business with a chinese cloud company? put all of their stuff in a -- in a cloud that is somehow tied to the chinese government? >> it's a great question there are a lot of enterprises

that asked the same thing. it speaks to why for alibaba it's an uphill climb for them on the cloud given some of the concerns i view them as a core number, maybe three or four player, but right now it's an amazon, microsoft cloud battle >> and amazon has the poll position, don't they >> clearly this is really their world and everyone else is paying rent terms where amazon has built it up to this point, they are in the poll position. but i will say microsoft and azure as well as alibaba and ibm -- >> do you cover alibaba, if they got every bit of cloud business in china, could it be the majority of revenues for alibaba, it's a huge market in of itself. they don't maybe need the u.s. >> the way we view the clouds over the next, let's call it,

four or five years, about 70% of the cloud deployments are going to be u.s. or europe based china, no doubt, you get alibaba in terms of their opportunity for them, that's a huge opportunity for them but in the scheme of cloud, where 30% of work goods go to 65% next year. it's a two-horse race with amazon and microsoft, and that's why the contract -- >> it's a defense department contract. >> the dod, going to cloud this is the ufc match between amazon and microsoft. >> we talk about the workers, google had a big moment with regard to addressing work place issues there a lot of folks within these tech organizations may not like the idea of working for a government entity like the defense department i know they're microsoft employees, some employees as amazon that may have reservat n reservations closely tied to the

government do you look at the cultural issues with regard to how they fit with a government contract >> we do that's why google pulled out of the battle when you look at microsoft, there have been some issues internally there, as well as amazon but it comes down to hq 2, the reason they're going to crystal city, the main reason is gjedi you want employees there heavily focussed on jedi i think if you wafundamentally h microsoft it's an issue but with the pentagon spending over the next decade, they have to put that aside. >> for dom crystal city is a 7 iron. >> maybe a 5 iron. >> thank you so much about the cloud supremacy. >> cloudy with a chance of meatballs. >> it could be. coming up, chinese internet

stocks taking a beating as we're headed into one of the largest shopping events. will that help out and coming up an analyst got his price down to $6 a share, will the hits keep coming or is this a good chance to get in. we're all waiting on word where amazon headquarters will land "power lunch" is back in two (phone rings) daddy, mommy's on the phone! hi! how are you guys? at&t proudly offers wireless and tv discounts to military, veterans, first responders and their families. visit att.com/hero. at fidelity, our online u.s. equity trades are just $4.95. so no matter what you trade, or where you trade,

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lunch. ten years ago alibaba started a one day shopping event that has become a multibillion dollar bonanza and it's happening again this sunday. deirdre is live in vancouver with more on singles day >> dom, well, let me first give you an idea how big this holiday has become in the decade-long run. the first day brought in less than $8 million in sales last year it was $25 billion this year it's expected to be bigger than ever >> it's more like that real reflection of the consumption gross and the digital -- the gross of the -- the gross of

digital business and today i think more and more people when they join november 11, join this shopping day -- >> now he also talked about its importance to the thousands of merchants on the platform to engage with customers and win over new ones. he calls it olympics for business but their competition has risen as well. jd.com, smaller chinese players have joined forces with ten scent. so they're giving different or cheaper options. there's also the backdrop of the slowing chinese economy. we'll be watching closely over the weekend to see what the holiday tells us this year about the health of the chinese consumer. >> thanks, deirdre >> so this idea of the trade of alibaba, this idea that gross merchandise value, we call it sales but it's the amount of

traffic they do on this single day. it was shocking to me that this event does not get more of a stock catalyst move for alibaba. the reason i say it's only been public for four years. it's always big, massive, but never seems to propel their stocks that's something that's curious to me. >> you're like this where all the chinese internet stocks have been in such a down drop because of so many different cross currents i'm not sure singles day is going to be enough to overcome it. the chinese internets have having a rough two months, all down more than 11% we'll talk about more about the stocks with scott kessler, the head of technology research with fra. scott, great to have you with us. >> thanks, melissa. >> what's your anticipation for singles day in an environment where there are doubts about china and the economic growth there. >> i think dom made a good point this is a huge event but it has

a de minimis impact on the stock, at least historically it has. i think that largely reflects the fact that there is really no easy way to discern, other than year over year growth, what the positives associated with this quote/unquote holiday are for alibaba and commerce in general. >> i think a lot of people will be watching the results of singles day come monday and think will i be able to tell what the chinese consumer is doing in terms of how i perceive china, the stock market there? >> i think that's fair obviously if we see a lack of an increase or notable increase from the 25 billion generated last year, i think questions will grow. but to be frank, alibaba generated 53% revenue growth and that didn't seem to allay concerns, largely because the company brought in its f-19

revenue guidance by about 5% but as referenced the stock is down around 20% year to date notably under performing a lot of comparable company stocks frankly we see a lot of value right here because we see the chinese consumer as stable, relatively healthy, in conjunction with the economy as a whole there. in addition to that we see a tremendous amount of secular growth i know you were talking about the cloud computing business, for example. >> is alibaba your favorite choice among the chinese internet companies >> yes tyler, in terms of chinese internet companies we only cover alibaba and baidu. we have a strong opinion on alibaba and a moderate opinion on baidu one of my colleagues covers tencent as well and has a strong

buy opinion on that stock. >> what sorts of data do you look at out of china that help you stay informed about the chinese con summer, helps you form the opinion of where the chinese consumer is going in commerce you can have a strong buy on alibaba but the perception is the stock market is going to go lower as long as the trade war with china is on >> it feels like that. in terms of data, the government puts out a tremendous amount of data i know there's skepticism about the sources or validity of the data, but that's a good source as far as we're concerned. in addition there are third party firms conducting research as well. to be frank we think the best source are the companies themselves when alibaba reports what we thought were very strong results and the market collectively yawns, we look at that as an opportunity. as you point out, however, maybe not necessarily over the next week or month, but more over the

next 12 months and that's really what our recommendation is intended to reflect. >> scott thanks for your time. scott kessler, cfra research coming up you can call it the general electric slide where's the music? we need the music? shares down 8% as one analyst slashes his price target to $6 a share, will the electric slide continue as we go to break, the dow and nasdaqesons ssilow for right now. 300 for the dow, nearly 380 for the nasdaq

welcome back to "power lunch. i'm mike santoly and this is trading nation general electric shares plunging at j.p. morgan cut its pricing target from $10 to $6 a share. ge down 86% since 2000 and most of it is this year, down 50% in 2018 alone is this stock officially a no touch proposition here

erin gibbs and matt taylor to weigh in on that matt, going to you to decide when bad is so bad it might be good is g.e. there yet? >> i don't think so. j.p. morgan has a $6 target on it i'm going to put a $6.60 target on it we remember when the s&p 500 was $6.66. the closing low in g.e. back then was also $6.66. that's kind of a weird coincidence and stuff but the reason i'm worried about it -- we get a stock like this, it's not a situation where the baby is thrown out with the bath water, it's down 75% from its highest two years ago compared to a 15% rally in the s&p. you're not getting paid to wait, it only pays a penny dividend, so you're not getting paid

anything even though the stock is oversold on a near term basis, if you look at the weekly charlottesvilchart, it's not as oversold as it was on two other occasions in the last 12 months i think it has to go lower before you want to buy it. >> this is almost the contrary play is come in and say $8 is enough for g.e. would you want to be in that camp if they can get anywhere near their announcements for next year? >> we haven't seen any stabilization. there are four concerns we have going forward. one, a lot of the reasons investors were in the stock was because of the dividend that's no longer there. two there's no way to know if they can take control of the restructuring business there are now investigations

from the sec and do you jones about goodwill and finally we see profit projections on a downward trend and no stabilization for us we don't see there's any reason to get in at this point until we see an end of negative news and declining earnings. >> okay. new ceo, they're going to separate some businesses they say -- the company says that they have goodly qui liqui but still a show me situation after a tough run. thank you both for that. for more trading nation head to our website or follow us on twitter. coming up on the show here, crude oil in a bear market why restaurant stocks could be the big beneficiaries of oil prices. a name to look at and other ones as well that stand the most to gain with low oil prices that's coming up next on the

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. a sell off on our hands right now. the dow is near sessions lows, the nasdaq pretty much at sessions lows, down 1.23% right now. s&p 500 down by 1.4%, or 40 points drilling down on technology because that's where we're seeing the pain, netflix, apple, sysco and amazon and also semistocks. sales force, micron, and qualcomm sales force not a semistock but that is down 5%. pg&e is down 14% on pace for its worst day in 14 years -- 16 years. the company announcing that it will shut off power to 12,000

california customers as a safety precaution due to the fires. let's get to contessa for a new jup date. >> four car bam bombs by islamic extremes went off in sew mali ya billionaire bill gates is linking up with tokyo 2020 olympic organizers to raise awareness of sustainable development goals. >> countries like japan will need to continue to invest generously, actually, even more generously than they currently are. today japan spends about 3 to 5% of its aid budget on global health so there's an opportunity to do even more.

>> reigning world chess champion defending his title in london this afternoon korana is a duel american citizen going on to win. he would be the first american to win since bobby fisher. let's look at this incredible video just into the news room from oak park, california, houses gutted, as the fire expands to more than 8,000 acres, over 75,000 homes are under evacuation orders but that number is expected to grow and grow very fast jane wells is in the thick of it in thousand oaks, california she joins us on the news line. how much more can thousand oaks endure this week >> tyler, i've lived here 30 years. it has been a very difficult 36

hours. i wouldn't be surprised if loved ones who lost -- families who lost loved ones in borderline are now evacuated because of two fires. there's a hill fire -- i'm in my back yard right now. the hill fire started last night about a half mile from me. it's now at 6,000 acres burning to the ocean that's what happens here these fires burn towards the sea which puts malibu on target. but it looks like in this particular case they're going to burn to the ocean north of malibu and into an area in many places which burned five years ago. so that will slow it as it happens. but there are hot spots. there's a hot spot four miles away from me right now i'm not the only one staying home right now i'm on the west side of the woosley fires, we have two people at home on the east side

of the fire, and it's burning down between us. fortunately no fatalities, a number of homes destroyed, certainly a much worse fire up in northern california where they have had a thousand structures destroyed and five deaths now reported. so resources which are always stretched thin this time of year are again thin i did see some fire fighting aircraft fly over me, and resources are coming to california from other states as they often do this time of year. >> you say you are in your back yard can you sense the fires? can you smell them can you see them >> i'm looking south right now in this part of southern california you think of the pacific ocean being west, it's actually south i'm looking south now and i'm watching as this plume from the fire, which is reaching as high as 3,000 feet according to cnbc is moving towards the water because that's where the santa

anna pushes you and the direction the fire usually goes. but there are reports the fire is spotting itself a mile ahead. in other words embers are flying a mile ahead of flames and some neighborhoods are getting last minute direction that they have to evacuate immediately. and the 101 is closed again for the second day in a row in a different area because of the fire the 101 further north was closed for a time last year during the thomas fire. it's just -- i live up against open space, i've had this house 26 years we've only had one fire that ever came a little bit close you know, it's part of living in california we have a fire break, you do what you can, and this time of year you just got to pray. >> and the pictures of the wind are really astonishing beyond the infernos that we see right here but the power of the winds is really something good luck, jane, to you and all of your neighbors out there.

stay in touch, okay. >> thank you >> thanks, jane. jane wells the oil market is closing for the day. let's get to jackie at the cnbc commodity desk. >> crude was layer on the day, the week, the month, the year. the gains from january to october, completely wiped out. session low 59.26, it looks like the close is just over $60 a barrel under 60 significant because it shows you there's conviction in the trade to the down side we've seen it before, test the level. look for monday to tegs and hold producers meeting this weekend, maybe some production that can come out of that but most saying don't hold your breath there's going to be an oversupply situation, it's going to take low prices to get the producers back in line. >> oil prices 19% now in the

drop, sending gasoline prices down, which could potentially help certain restaurants matt, we have seen a correlation in the past about consumer spending tied to at least oil prices decline so are we going to see that this time around as well? >> i think it's important. i think you touch on two things not only gasoline but oil as far as getting into the winter months, 4q and 1q, the casual diners, the regions in the midwest and northeast that use home heating oil underperformed. so it's something to look at as far as how much could redirect income for bills to the households if it's flat year after year it's better than a situation we had 1q '18 oil prices up almost 25% for the household. so energy bills were higher. this year we're looking to be, now at the $60 level per barrel should be in line with where we

were this time last year. >> are there parts of the market that benefit more or less because of the impact? >> sure. you mentioned dar din, they have the olive garden brand, perhaps the positioning with the lower income consumer is benefitted there because the rebait that you could get over time if gas does continue to come down in price and turns to being favorable year over year, we saw it two and a half years ago, about $1,000 per household in an overall savings from gasoline at the pump and historically you do see that get spent in the aspirational brands so the brands the lower income consumer wants to dine out when they have more money. >> are you heartened by the fact retailers seem to see better trends and therefore the mall traffic has improved. >> you're seeing it across the board. we're at full employment seeing wage pressure driving income growth also

i think it's one of the factors and nice not to be a head wind as much as it was maybe earlier on in the year you want to see calm, steady you don't want to see spikes and we're not setting up for having a spike perhaps. >> matt, great to speak with you. thank you. >> thank you. coming up disney's new streaming service and netflix's push to animation. the two companies battling it out over content that's next. the live data board is brought to you by the cme group. cme grp,ou where the world comes to manage risk

welcome back to "power lunch. breaking news from third point, the hedge fund releasing its third quarter letter showing a new position in american express, sending those shares up after those headlines crossed. although they have come back down since then up about .3% the firm says they see upside up about 30% from the current levels at about 135 per share in the next 18 months going behind

the new ceo as well as the strategic refresh the company is going through. the firm also discussing performance which lagged the broader index in the third quarter as well as year to date. they tried to put some color to what we saw in october with regard to the major market volatilities talking about the perfect storm of volatilities plus the overzealous fed. disney selling down the quantity lets with netflix the company will remove all content from netflix and announced their own streaming service called disney plus but netflix isn't going down easily they're taking aim at animation. breaking down the biggest players in children's entertainment, joining us is brent lang brent, welcome it sounds like disney is saying take that netflix and netflix is saying take that disney we're

both going after the core. is it possible they both could succeed? >> absolutely. it's completely possibly they both could succeed you're talking about companies investing heavily in the animation space they see an opportunity here, and they're pairing with some of the biggest names in the space netflix is signing with the director of "little mermaid" so obviously they're investing heavily and betting big they can be a big player here >> there's a real -- i don't know if it's symmetry or asymmetry, disney would seem to have the head start on animation and programming and netflix has the big head start on streaming services. >> you're right. each has an advantage. netflix has a head start on where disney is. they have 130 million -- >> can disney catch them or does -- does disney have to catch them to succeed?

>> i don't think they have to necessarily get to that level. that would be unprecedented for them to grow at that rate. but what they do need to do is establish a presence and establish it quickly and early because they're not the only ones coming into this space. you have comcast is very interested in going direct to consumer, warner media is coming out with their own service at the end of 2019. so it's going to get competitive here. >> in the children's space, is there a dollar amount tied to that market? what's the dollar amount for the children's content melissa cobb is the ahead of netflix's children and family division, who's better equipped to go after that. >> you have to give disney a heads up in terms of brand recogniti recognition, even netflix would admit that disney is the name in the space. but 60% of their subscribers like kids and family entertainment. if you look at some of the

biggest films in any year many are billion dollar grossing movies from companies like pixar. >> you have platforms for playstation, x box, back in the day atari, se ga so how do you handicap who gets the edge who becomes the playstation and xbox. >> you have to give netflix an edge in terms of the fact it's out there with its service and it's unclear how disney is going to manage this they have a big company to run still. they're weighed differently by wall street analysts than netflix. netflix doesn't have to make the kind of profit disney does if disney is taking its content off of different services, that means it's forfeiting billions of dollars in licensing fees while investing heavily in their

own service. >> they have one thing they own as a proprietary thing and that's a studio. >> that's right. netflix is newer in the original content game the reason they're doing this is because people are stopping licensing content to them, so they don't have a choice they have to start to produce their own content. and that's not always worked out so well for them "bright" for example, a will smith movie they made -- >> it was awful. >> yeah. quality is a big selling point. >> you can have hits but you can have misses in this game, as any network will tell you. >> absolutely. >> brent thank you so much brent lang, variety. coming up, the stocks that could win big if amazon hg 2 gets between new york and virginia it haso it tdo wh the housing market the companies that could benefit, the big names coming up next

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welcome back to power lunch. waiting on where the h2q project will land. it is long island city in new york and not crystal springs, crystal city, virginia if that happens it is one group of stocks that could be impacted the most we are live in my hometown

>> it has not confirmed its choice or choices for h2q. investors are honing in on the stocks that could benefit. it is the apartment that are in play they have direct exposure there. the stocks jumped higher after reports that the weekend, crystal city was in the lead and that it could be both cities they have been there for over a decade for several high-rises >> it is huge for manhattan. a huge amount of supply has been built along with the burros. it has not been great this cycle in part because of the glut of

high end apartments. >> and the same is true in the d.c. area around crystal city. breath it is based in houston its exposure is close to 20% north ea northern virginia is 6% alone. how many it hires will come within the market and how many will move in and take up new space. back to you guys >> thank you let's zero there on some of those apartment wreaths here he covers avenue lon bay and many many more great to be here >> important to understand in those particular local markets is what the supply situation already is if that's glut and even new headquarters might not do much for that local real estate market what's your take on where these markets are? >> i think it is probably overstating it i think we have a little too

much growth. it is the product of what has been a really good run for three to five years. clearly if amazon is correct and talking about 25,000 employees in each location with average household income of $100,000 it's really very very positive it would take more than just provide a shot in the arm. i think it would really put the markets into balance on the amazon employees alone and then if we think about the impact amazon creates, a knowledge cluster with companies and employees trying to sell them apps and what have you, and if it develops the way it did in seattle it could become, you know, each of those markets could grow significantly >> is this enough to change your outlook of any that operate in these markets? >> i think the answer to that will depend on timing and pace they haven't confirmed each

location >> what has the history told you about amazon and what happens when it moves headquarters it used to be out on a big kind of a mountain. they moved more into downtown. what happened? >> the big change that took place in terms of value creation was when paul allen combined to build and convert warehouses into what became the headquarters for amazon. it occupies 37 buildings they have over 40,000 employees. so that transformed that market over about a 15 year period. paul allen made a lot of money before that. but it probably was his major source of i would say value creation in the 15 years before he died. it wasn't just amazon. it became a center for life science as well. >> so we are focusing a lot on the housing side of things.

retail space will do well. i think what's also a little bit under the radar screen here is that the city announced -- new york city announced they want to also develop long island city as a city for life science. so they bought a building there 30 days ago. it was a surprise. it was really out of the blue. nobody was expecting it. if we get that it would be totally transformative >> got you >> thank you so much >>ha y tnkou >> coming up next, check please. let's begin.

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nasdaq feeling the most pain down 1.8%. for the week it looked like we were going to have a decent week the nasdaq lost almost all of

it >> but the dow is up almost 3% >> yes >> it is >> it has been a decent trade. can they find any kind of footing? it has been tough for these guys right now. >> thanks for watching power lunch. >> closing bell right now. happy friday welcome to the closing bell at the snonew york stock exchange. we are winding out a pretty solid earnings season. we will round up all of the factors pressuring stocks plus the ceo speaking out in a rare interview about the china