good stuff, thank you. >> real estate one of the best sectors this year, and s.t.o.r., store capital up 17%. >> airlines, it's a gift to you. have a great weekend "power lunch" starts now i'm melissa lee, stock with a violent move into the red, job growth missing the mark, but shouldn't that be good news if you want the fed to scale back rate hikes where do prices go from here will the cuts stick? we'll head live to vienna in just minutes to now. a smoking deal both stocks are rallies light now. what it means for this red-hot space. "power lunch" starts right now oh, yes, it does

welcome, everybody i'm tiler mathisen glad you could join us stocks getting hit again nasdaq, the hardest victim here. one of the big reasons for today's drop is technology check the go-to names like facebook, apple, amazon, netflix, all of them rolling over there you see, major percentage losses apple on the verge of losing all of its gains from 2018 so far. melissa mentioned oils rally the big energy names you see they are in the green. they are moving up sharply it is the best performing sexor today. let's get straight to what's drove the action today

also elan mu dr. trade and -- as bell as the down side, let me show you an intraday of the s&p 500. 9:35 eastern time larry kudlow comes on the air and starts talking optimistically, saying the president would consider extending the truce if there was progress made. you see the markets lift and drift sideways, then about 10:15, peter navarro is speaking on cnn if the u.s. would walk away, and they said they would move forward with raising tariffs. you see the market drift lower this kind of difficulty interpreting the intent of the trump administration has been a problem for months now marco kolanovic, an influential

analyst, he said exactly that. it was the destabilize the impact on the trade policies these policies might have erased up to 10% of the s&p 500 value this year. bold claim there, but you can see the gyrations. typical trade names moved down, intel is weaker. apple also moved down. defensive names like coca-cola, procter and game able, they decli decline much less than that, basically flat the banks again new lows today for goldman, bank of america, citigroup and aig. 2632 on the s&p 500, that was the closing low on november 23rd, was it

the friday after thanksgiving, and everything's watching. we did not make that yesterday it was a sigh of relief. we'll keep an eye on that. we're a good 30 points away from that right now. >> robert, thank you very much the markets have gotten their goldilocks job numbers, not too hot, not too cold, but will a slight hold cause the fed to hold on the rate increase. brainard speaking in the last hour or so, and she cited several risks both domestic and global. >> so the most likely path for the economy is positive, although some tailwinds that have provided a boost are fading, and we may face in cross-currents the global growth that provided a strong tailwind going into this year has moderated.

here at home, the impetus to growth from fiscal policy is likely to fade going into 2020 after being exceptionally accommodative, financial conditions have tightened in recent months. >> she spoke after a jobs report that showed an economy cooling, but not freezing by any means. rsm writing, a recession is not looming, and bankrate writes -- this is far from the grinch who stole christmas. the outlook is a slowing, but not a halt in job creation the jobs report was less than expected 198 was the expectation. a hourly averages a tick lower than expected, unemployment rate unchanged, and labor force participation at 62.9% what does it mean for fed?

i have not seen the market move like this in a long time take a look here we were at 50 purposes, or a couple days ago of a june hike. >> maybe even a day ago. there is no hike priced in now for 2019 just now. one more thing, before you get excited, tyler, i will tell you a month ago markets had a 60% chance of the first 2019 hike happening in march >> yeah. i remember that. >> the doves will win the day, the week, the month and they may win the year. >> so what was the dog whistle that went off about a month ago that has caused the rhetoric to change, those probabilities to change was it that somebody tuned into "mad money" and heard cramer what was it? what was it?

>> you might go back to the ppg earnings call. that was the first time -- maybe not the first time it was among the most popularized times. i'm guessing where a company said, look, this trade stuff is starting to bother us. you heard the jvp morgan stuff, everybody that is underestimated which the trade would be a negative so the trade was not working itself out. >> people were calculating it in a very quantitative way, in that it's going to be 0% on this se of goods, it's this dollar amount of impact, as opposed to expanding it to the impact on sentiment, and having that unknown effect. >> right >> you did see the brt ceo index fall the direction is negative, and i think you add on that a sense of a recalcitrant fed, that in the face of things that were going to be slowing down and cooling, there was an idea that the fed

was hellbent on 3% we have removed that, but it's the trait thing that keeping gnaws at it. there's something like 17 board members, and they speak out unison than three members of the administration when it comes to trade. >> it does seemed that way. >> thank you, steve. >> a pleasure. brian sullivan is live on the ground at the opec summit in vienna hi, brian. >> reporter: thank you, melissa. basically we came out and told you that 1-2 to 1-4 was expected and we got 1-2 why didn't the market rally then very simple. when opec says they're going to cut by a certain amount, you have to know what they're bringing it down front of. november saw saudi production in

particular go up we talked to the aramco ceo, saying they were going to add production oy in the end a lot of math. the bottom line -- the saudis will cut more production than many people initially expected rischa coming in with a cut on their own. other non-opec owner filling in the rest 1.2 million, but again off those october levels more importantly i think for opecs, with the price move, there's been all this talk about qatar quitting, and what is the authority of the organization. we had a chance after the press conference, and we got a few comments from the energy minister of the uae, and i asked

him. >> we cannot do it without the non-opec this is a group of browers who cares about consumers as well as their own countries. >> reporter: the idea become that opec has power, but really it has more when the it's opec and non-opec you can cause it r-opec for the russia, but they need it to counter, you know what, the u.s. shale boom so they had to do something today, otherwise oil probably would have been in the high 30s, low 40s. nobody wants that except for the consumers. it's bad for the oil and gas community. >> thank you, brian. get home safe. with the markets fading with just three hours of trading, where do we go scott clemens is here, steve auth is also if fedderated

you seem to be -- the fundamentals look pretty good, and yet you are recommending adding to international positions overseas, international developed markets and emerging why do you favor that as a buy >> that's simply a reflection of what's going on in those markets. >> they're down more. >> and that's been reflected in valuations it's hard to paint with a broad brush, but in general the valuation dicot mick between the u.s. and emerging markets is wider than the summer of 1998. those are opportunities. >> steve, why don't you chime in here, and let us know what you see for the u.s. market in particular, and i note that you have pushed out your targets on the s&p, which you thought would be hit sooner to later in 2019

why? >> we pushed it out, tyler to the end of the year. we took or economy numbers down, too. we think we're in an economic soft patch i think you kind of gave me that discussion earlier with your staff, you know, on what drove this thing down, but one of them was certainly the earnings season, starting out with the ppg call you had powell stating, probably incorrectly that the fed was going to raise rates photographer, and then oil collapsing it was the perfect storm to tap the brakes we think there's a bit of a soft patch now in the economy we've gotten a lot of decent news in the last week and a half, you know, the fed has backed off the rate hikes. that will be good news we have a kind of goldilocks number today, 1.2 million was a good number.

gave goldilocks jobs number as well one thing out there is the trade thing -- >> forgive me for interrupting, steve. so why is the market down? >> you didn't get goldilocks out of the trade thing >> you have a wolf in there, right? >> we have this back and forth within the trump administration. to me -- a lot of people say what would you a expect, sit view it as just the back and forth you get, good cop/bad cop, but it would be it goes somewhere else we have to get a resolution on that, i think, for the economy to relift and then the market to relift with it. >> scott, you sound like you're a little more defensive when it comes to positions your u.s. part of your portfolio.

>> again it's a reflection of where the opportunity are. i do think 2019 is a story of moderation we've had a tailwind of tax cuts that moderates back to a more durable, more sustainable level. i don't worry about a recession in 2019, but a more moderate the economy where i want an exposure to consumer spending anecdotal evidence from black friday, early christmas sales. >> the home builders haven't been doing well. that's a part of discretionary. >> it is rising mortgage rates have hit the home building industry it's not his home prices that's the store of wealth for most american families thank you both have a good weekend. the chief financial officer

of huawei has a court hear today. and altria making a bit on cronos leonplus tesla hits a major miste. the stock is responding, all that and much more, ahead on "power lunch." (sounds of race cars) the same iot technology on the ibm cloud that helps race teams improve performance and safety.

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stocks first rallied on comments by larry kudlow on cnbc, but those were wiped out when peter navarro was less optimistic in a cnn interview. >> it's a question of moving forward, which is simply to raise the tariffs from 10%, which they were now, to 200%. >> but jamie dimon, chairmspeakg yesterday. >> i give it 60%, but the risk is if something goes south. >> we arrested the lady from huawei, and i heard a rumor they arrested some americans in

china. that kind of stuff is just not-ful. joining us is alexis crowe she is recently back from traveling to china given matters of client confidentiality, she is limit to do what she can say regarding the arrest, but it's great to get your perspective larry kudlow said he believes what's going on with huawei and the trade talks are on separate tracks can they be separated? >> what's important to know is we look into bear market territory and why investors are doubtful in the hopes of truce what has been evident from the midterm elections is that it remains all too politically convenient to blame the wealth creation of another country for do metzic problems here at home. >> who does that mean in terms

of whether or not you think this arrest will make any difference. >> a much more endemic problem a much more longer-term problem. i would be doubtful, and i would say more private equity negotiations tactics staying on, so tariffs potential remainings, potentially not an an acceleration. does the arrest make it -- >> i would believe it would be different to make it a full all stop >> so it doesn't really matter >> correct >> explain it to me, why there seems to be a disconnect between what the administration is willing to put out publicly and

what the chinese seem willing to talk about publicly. our administration is very proud to trumpet the idea that we're going to be agriculture and production of automobiles going in, but the chinese have said very little. explain that to me >> we certainly have different cultures here. going back to the fed statements, to the markets versus the pboc, we're in transition as to what we communicate to the markets even when i helped our clients and i look at until these are done, signed, sealed and done, it's still up for negotiation. with regard to china, i think you'll sees less communication until we see things fully signed, dotted and sealed. >> in the days after the g-20 meeting there were many, many discussions and debates over the

differences in the statements that are being made and what trump is tweeting, and what various administration officials were saying. do the chinese follow all of this do they sit back and scratch their heads and think, i don't know what they're talking about? this is what we know, and we never put a dollar amount on the amount of goods we're going to buy, things like that? >> what i think is important to note is they are a very pragmatic economy, and they act pragmatically, so you may look back and think some of the statements are unbalanced, or n unsynchroni unsynchronized what i would say they are pragmatic over the long sister terms and worked in the best ways to secure a good deal going

forward. what is interesting to note is not just the attention to america, but the outbound activity with regard to the eu, cleaning up act with the eu with regard to shinzo abe in japan. so you're seeing four more geo strategic lengths. >> in sum, are we economic partners, more partners with compliance china or more rivals >> a good health the competition is healthy i would argue the problem is exports. how do we may service exports more competitive. >> well, the services part of it is really critical, isn't it >> correct >> that's what we do best and most. >> correct >> if china will buy more of those, as they seem that they are going to indicate that they're going do, that can be a big mover. >> and guess what?

we need an export market for our services and guess what you look at the consumption patterns in china, it is towards services you look at the rebounding of some of the stocks there. >> services just like what pwc supplies, by the way. >> amen. >> alexis crow, thank you. altria making a big bet on pot, taking a stake in cronos group. and tech turning, taking the rest of the markets with it. ow lchisacinwo minutes. [leaf blower] you should be mad at leaf blowers. [beep]

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hello, everyone. i'm sue herera here's your news update. house republicans are questioning former fbi director james comey on decisions made by the just department during the 2016 presidential election this is in a closed-door interview, but it's also being attended by democrats. an ally of angela merkel has been elected as the new leader of germany's cdu party she received 52% of the vote

against merkel's one-time rival. this video is causing quite a stir the footage has prompted trade unions and far left parties to lash out at perceived police brutality. and vladimir putin is presented with a racing helmet putin telling tott he was pleased that he can come to russia fia is the governing body of formula 1 raisin thank you, sue major dealing aditi roy has the details. >> shares of the cronos group is up nearly 40%.

altria will be investing 1.8 billion for a 45% stake. the tobacco maker can increase its investment to 55% over the next four years. cronos says the deal accelerating the pace of expansion across the growth improved distribution capabilities and navigate regulatory issues. the move comes as big tobacco has faced increasing challenges from declining smoking rates to heightened regulatory pressure to competition from e-cigarette companies. altria shares are down more than 22% year to date cnbc has also reported that altria has been in talks with juul and a person familiar with those talks, telling us that the deal could be finished later this month

shareses of in the group are all up right now tyler, back to you. >> it's fascinating to see a spirits and wine company getting in, and on the other, a tobacco company. that feels like an epic battle that is going to take place here, right? >> and family have been talking about pharmaceutical companies, eventually also trying to get stakes in the industry, and if you expand into things like cbd, you fold health and wellness, so there seems like there's a lot up for grabs. >> aditi roy, thank you very much s. if you're still looking for a job, with you will take you into an industry that could have as many as nine open jobs for every application. we will show you where the jobs are. plus the market giving back all of those morning gains and more today there is yet again just one green stock on the board it would be cvs.

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the dow is down about 3% for the week, and right now it is down by 429 points, a lot of 1.75%. the s&p 500 is off its session louse by by about seven points, and the nasdaq is off by 158 points, 2.2% is the decline there. energy and utilities are the only s&p 500 sectors in the green. still ahead this half hour, growth spending and the impact of tariffs. elan, you are up first. >> ceo confidence is softening the outlook index fell nearly 5%

now, that is still a good reading. exec stiffs this is the and that is a reflection of the uncertainly around the trade war and the reality that the labor market has really gotten tight the ceo plans for firing fell about a point after reaching report highs earlier this year plans for capital investment, they also dropped 5.3 points to 97.9 sales forecasts also fell eight points to 123.6. for 2019, the ceos forecast will hit just below the 3% goal line said by the trump administration executives were also asked about the biggest cost precious. the top answer, 37% said it was labor, followed by 20% citing materials costs.

guys, 82% of executives said there is a strong to moderate benefit from removing the current tariffs. >> thank you, ylan mui softer jobs report than expected, but according to the most recent jolts survey there are more than 7 million openings joining us is tom game able, the ceo of the lasalle note work, a job staffing and recruiting firm tom, what did the survey show? >> it showed that companies are still hiring, compensation has surpassed culture as the preeminent thing, and that's a big change with the statistic you showed up 7 million open jobs is exactly true we may have only added 155,000

jobs in november, but it shows the jobs are out there, companies are hiring, and they're still making money. >> why are 7 million jobs open and going unskilled? a is it because we don't somewhere the -- >> you hit the nail on the head on the stem side of it on the how shouldly worker, we still have a lot of jobs for the people who are long-term unemployed don't want to get in and do so we have this intermediate period we're just not matching it up correctly. following up, those jobs are going to go overseas the white-collar jobs now, tyler go overseas, whether it's accounting or legal. that stuff can be done we're not competing against our neighbors in the cul-de-sac or apartment building

we're competing against other countries. >> what gets us through that interim period you mentioned >> you know, 7 million is the number what companies are starting to do, and we're seeing a lot of clients, they're investing more in training and development. especially coinciding this problem, it coincides with the baby boomers coming out of the workforce. you have more investment in training and development, you have more kids coming out of college. that's what's going to happen to get us over this hump. what we'll see is eventually there will be a decline in the economy, but it's kind of becoming a self-fulfilling prophecy sometimes you have to sit bagsa back and say this is a loan tenure of recovery the fed is doing their thing, raising interest rates we've never been a technology driven technology in a global world, so it would be a longer recovery

let's not look for the end of the world. >> what percentage of companies plan to add to head count next year and how does that compare to a survey you might have done a year ago and how many plan to raise wages? >> well over 50% will raise wages and high more this year. what we see differently is they don't hire enmal masse as much what we saw during the dot-com, people were hiring in surplus, to be prepared for the growth. what we have now is companies have learned their lesson from the great recession and the dot-com bubble bursting. they realize they hire just when we need it we see that with gig workers, temporary staffing, contractors, companies are more intelligence about the ways they hire and the different types of people they hire. >> tom, thank you very much.

tom game ab tom gimbel is with the lasalle network. indicate rogers has more from horse cave, kentucky, rockic a red hair net. kate >> thank you for the support, melissa. we're here at t.marzetti, and they say they could at 300 or more in roles from engineering to customer service and more we're here at their facility where they're making and bottling sauces that go to major food players from chick-fil-a, red lobster and more they say finding workers can be a challenge. >> what we found you have to pay the market price to get good talent, and in order to keep them, you have to make shower

you haves ongoing training a for them, and they be also somewhere to make them feel important, valued and involved. >> the company issings working on upscaling its woautomated wok >> you take care of your people, let them be part of the problem solving. they want to be here, you know they want to be here the conditions are good. we have a lot of talented people here. >> reporter: a recent study from dhl said this is a supply and problem issue. so good pay and benefits just aren't enough anymore. companies need to be out there aggressively recruiting. we have some breaking news here on the 23rd steve? >> thanks, very much

james bullard is becoming what i understand the first fed president to talk about a delay in december. he's saying the fed could consider delaying a december rate hike so as not to invert the yield curve, saying the fed should not intentionally delay it, saying in january it could hike rates then. bullard will be a voter in the january meeting. he is one who has called for consistently a lower rate. i don't know if others supporting the market certainly felt as if today's jobs number was strong enough to keep the federal reserve going, and then we have rick coming up to talk more about this. take a look at the two-year note, which has declined a bit

it's gone down consistently right now we're at that low level of 14 basis points on the 210 spread, and tyler, another quarter-point hike could possibly invert it there. >> let me ask you something, steve. is there a point at which the sort of softening rhetoric that is coming out from a variety of fed governors and members of the fomc board there, is there a point at which that softening rhetoric becomes alarming? >> that's a good question, tyler. i think that the fed in this new age of transparency doesn't know a lot more than what's known on the street i think it sees the same things we are seeing. the question is not what the fed knows. the it was a little late reacting, and guys in the back, if you could put up at fed.1, we

could see if there was any impact there it is. i think we go into this meeting with certainly a lot more questions, tyler, about what the fed will do in december. it looks like retail sales at the end of next friday is the last major economic report that could color the fed's view on the economy, but i'm going with what most of the wall street economists have said dao, that today's jobs number is enough for the fed to go in december and then on hold we just reported what lael brainard said is near-term hikes, and then they'll look around. >> remind us what voting members of the fed have said >> they had said when we first went at this, melissa, guys like kaplan and others -- i don't

remember if he's a voting some member -- said they did not want to intentional invert the curve. not every member has spoken about it, but i think bill laat talking that the fed did not intentional invert the curve >> thank you, steve. >> let ate go out to rick san te -- santelli >> bullard was not interested in inverting the curve. just for some comical relief, the horse is out of the barn on that with respect to a lot of the policy long in place is responsible for a much flatter curve. now, when this 4th line came out, we're basically down more in the short end than the long end, so today was already a minor curve steepening between

10s and 2s when you get to 10s they're down two. w.h.o. y when you get to 30s, they're down one i do respect the notion that fed funds futures are more accurate than the back months it is getting closer and closer to the 50% line, though it's still a bit away, depending on how sharp your pence pence -- p. we're down at 282, which is a very good support level. if you open up the chart to august 1st, the last low in august was 281 that's why it's so important so we're six basis points away

let's keep the same date and go to the 30-year bond. it's the low right before the move accentuated the up side, was 296. we're basically 20 basis points away the next chart is 30s minus 10s. the steepest basically since february some steepening is going on on the long end gives me confidence that a fed policy is threaded exactly right. maybe they will be able to say they aren't the catalyst, but it's still a very close line right now. back to you. rick, thank you. another volatile trading, what the charts are saying about where we go from here. stay tuned

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the markets and why we're struggling we have the executive director of oppenheimer and company great to see you let's start off with the s&p 500. what kind of damage has been done this week >> the damage actually started in october. i do think the uptrend's been broken but i think from a near-term basis the index is at the point where it's bottoming here's the chart of the s&p 500 that i brought with me for the show and we can see that the multi-year uptrend dating back to 2016 was reversed during that bout of volatility that we've seen since the start of the fourth quarter however, conditions are getting oversold we're seeing the market trying

to stabilize at that initial october bottom we're still above the q1 lows. our take is that this is a transition from an uptrend to a range. and i think the case can be made that we're at the lower end of this range >> so the february low 2532, they're not in sight even though we've done this damage, the ranges will be higher than those lows earlier this year >> i think as it stands now we should be able to hold the october lows that you saw last month around 2,600 we're not out of the woods for the long term and i think we could get down to that 2,500 mark in 2019 here's why this is the second chart i think one key -- what really exemplifies what's going on in the market is that risk assets are broke opinion the that risk has unwound in the fourth quarter. check out the s&p 500 high beta index. this is an index of deep cyclical stocks with the highest sensitivity to market movements. note a couple things here.

one, this index did not get above its january high like the s&p 500 did. it lagged during that summer rally. and now on this pullback it is already below it's first quarter lows it's below support it's making both lower highs and lower lows so on one hand this index system oversold i think sediment is getting pessimistic here think there we're due for a bounce, but risk assets face formidable resistance on the way back up. i think it's going to present problems in 2019 and think there's a ceiling out there. >> thank you so much good to see you. >> thank you. all right. tesla hitting a major milestone, one that could save the electric carmaker a lot of money. we'll tell you what it is tra straight ahead on "power lunch."

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the strike price or conversion price comes as 359 and change. $359.88. that's because the strzok stok is trading above a88 in other words, if it stays above that by march sore it above that in march, they cishek quitty to those convertible bond holders. if it falls below that then they're out cash this weekend on sunday, elon smu musk is profiled by 60 minutes here a clip of the exchange between him and leslie staal talking about his social media habits. >> you tweet a lot. >> i use my tweets to express myself some people use their hair i use twitter. >> well, but you use your tweeting to kind of get back at critics. >> rarely. >> you kind of have little wars with the press. >> twitter's a war zone. if somebody's going jump in the war zone, it's like, okay, you're in the arena.

let's go >> quote of the day, twitter's a war zone look at shares of tesla again, and, again, it has moved higher above $360 jeffrey's out this morning upgrading it to a buy, raising the price target to $450 tyler, we are looking at a stock that at one point people were saying, wow, is it ever going to get back up close to 350, 355, now it's above 360. >> phil, thank you very much and technology tumbling again taking the markets down with it. 2:00 p.m. hour has turned into a volatile hour of trading you waon't want to miss what's coming up. don't go anywhere. we'll be back with more "power lunch.

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welcome back, everybody, i'm tyler imagineson here's what's on the menu for a second hour of power on a friday stocks tanking again look what's happening with the dow. the major averages off about 4% this week. right now the dow down 527 points it has softened, weakened in just the past few minutes. just 15 trading days left in 2018 we're starting to look ahead to next year. what can we expect, the market veteran is here with his 2019 outlook. and running on all cylinders, while the market has fallen to

quarter, one stock is up 37% we will tell you what it is and whether the run can continue and oil stocks moving higher today as opec agrees to a cut. is it time to buy or is the sector a one-day bounce? from semis to apple, to netflix, let's talk about tech. broad selloff today. we'll take a look at what's driving it and what could be ahead as "power lunch" resumes right now. >> and welcome to "power lunch." a volatile day on the street as the market loads its early morning gains and we are now as we start the 2:00 hour at session lows the dow had been up nearly a hundred points following the job reports. all major averages are down 3% for the week the dow is down 521 points or more than a 2% loss. s&p 500 this is close to a fresh session low here, 2639 is the level down 56 points or 2.1% and

the nasdaq down by 2.6%. healthcare and communication services are lagging sectorwise. and utilities only sector trading higher right now energy, oil was higher following opec's deal to cut production. it did sink in just the past 15 or 20 minutes or so so we're watching that very carefully but we're watching other resources, they're up sharply on this session we're keeping an eye out on apple as well, the stock losing almost all of its gains for the year it is up only 1% here if the is down 2.7% for the day. and it has been a rough week for the regional banks etf that tracks the sector kre on pace for its worst week since march. that pain continues today down 1.3% >> i'm kelly evans stocks making a huge swing from the 150-point gain this morning to a 500 point loss right now. the latest jobs report today showing a bit soft on the wage front. big tech is stumbling again were apple, google, netflix all weaker today and oil is spiking

although after its highs after opec agreed to a cut let's get more from bob down at the new york stock exchange. >> bullard making positive comments but it's again trade and tariffs that seem to be dominating let's look at the s&p 500, they circled the two points that mattered noft, larry kudlow on the air 9:05 saying the president could consider extending the 90-day tariff truce if good pro cress was made on tariffs we rose about 125 points you see that at the open then peter navarro came on saying whether china trade talks were not resolved in time in 90 days navarro said they would move forward with raising tariffs. see the market moving lower and continuing to move lower this trade policy has been noted by a lot of analysts marco know theed this this morning. he says the risk that many

market participants underestimated was the trade impact these policies might have erased up to 10% of the s&p 500 this year you see the impact this is having on the markets. look at some of the issues for the day. we did see mostly retail has been impacted, semiconductor, healthcare, industrial's also down defensive names like utilities and consumer staples doing better stocks up on the opec agreement but not dramatically 1% or 2%, considering the declines these are modest rebounds financials we mentioned last several days again hit new lows. gold man, bank of america, citi, 52 lows there. 2632 is what you want to watch carefully here that was the lows right after we hit the thanksgiving holiday and that was the recent lows for the market

2632 for the closing low back to you. >> thank you, bob. now let's get to bertha coons at the nasdaq. bertha. >> that's right. the worst today r but thbut thi broad selloff. small caps,although not as bad today for the week are down more than the major averages down 5%. certainly technology is at the heart of the problem the chip sector down more than 6.5% for the week, seeing its biggest drop since the swoon last march apple a big reason why is its suppliers continue to report slowing demand apple shares down now for the ninth week out of ten. on pace for its worst quarter since 2012 and i might remind you that prompted a three straight quarter decline for apple when shares really stalled. broad combucking the tre buckind but it's well off the highs and dipping into negative territory as well.

biotech under pressure as healthcare sinks on pace for the worst weekly loss since the october selloff making for a very tough ipo debut today for cnbc disrupter ma determina therapeutics it's focusing on harnessing one dna part of your gentleman nometic to fight disease yooms priced at the midpoint of the range with a bigger offering, raised more than 600 million, it now is evaluated at 700 million. but you can see it opened lower and while it's the biggest biotech ipo in the year, 69th ipo in fact for the nasdaq out of 180 overall, it's had a rough debut today in a tough take. kelly. >> let's talk more about that. a difficult tape and a big headline from a future voting member of the fed. james bullard saying the fed could halt further rate hikes. what's going on. >> james bullard, become the first fed torvofficial to sugge

delay. he said the fed could move on in january. he's a voter in 2019, not now but he will get the vote beginning next year. saying the fed could delay because of the narrow yield curve. 14 basis points as we speak. he said no purpose in the fed acting to invert the yield curve. there is the 210 spread which is 14 basis points, hadn't been as low as single digits in what was that a couple days ago this follows the fed governor saying rate hikes are appropriate, a couple hours earlier, but future hikes are depend on how it goes. we have softening overseas economies, brexit risk and trades uncertainty >> thank you very much we appreciate it very interesting breaking news as the fed folks speak a lot this week. been a volatile few months for investors with selloffs in october and november and now again in december. and our next guest says there's more pain ahead he expects a recession next year and here to share his playbook is morgan creek capital manager

and ceo and investor mark, welcome. good to have you back. >> thanks for having me. >> you've been with us before. >> yeah. >> and you predict and you predict that there will be recessions in japan, europe, and the u.s. in 2019 but the last time you were on fast money 1127 you said i don't think the fed will pause, i think it's going to continue to normalize. >> yeah. >> do you still feel that way in light of what the rhetoric has been over recent days, and do you think that change in rhetoric is a reflection of the idea that the fed may be sensing, what do you sense, which is a global slowdown that could lead to recession? >> they've said over and over that they want to be data dependent. and all the data has been quite bad recently from housing to global trade to corporate protests globally. i think they are sensing that. i think they're kind of out ahead -- >> are you including that jobs

report. >> it's not a disaster but it's a disappointment they expected 188 and you get one fiftying some. it's not a disaster, but it's a dispoint there's no question that economic growth is slowing whether or not we dip into recession we'll see that next year i think that's going to happen i think you're seeing it in the eu japan is into two quarters of negative growth. >> do you think that the fed will pause you didn't recently. >> no, i think they're going -- >> you think it's full steam ahead? >> i think they're going in december i think that's a foregone conclusion that's baked in the numbers already. and i do think that -- we'll see how they react in the first part of next year, but, look, their job isn't to regulate the stock market, as many think it is. >> right. >> their job is to combat inflation and to, you know, get full employment. we are at a point with employment where you're going to

start to see wage pressures, and you have i think they've got to get back up to nominal gdp growth that's where the level short rate should. >> going back to what bullard said, though, it almost seems like the fed is or might want to be in the business of regulating a market in a way because if you're saying that we don't want continue to vert the yield curve, you're also making a statement about the longer end of the yield curve which is being held down right now by rates around the world which is out of their control. >> yes. >> so if you believe that europe is still slowing. >> yeah. >> and the data's all indicating that way, then the longer end of the yield curve will remain lower. and the fed is boxed in when it -- i mean, if that's really going to be a north star for the fed, they're boxed in when it comes to how many rate hikes they can do. >> i couldn't agree more and i actually #fed in a box because they've been in this box for a while. and they don't control the long end. the long end is telling us, i think, that they're making a policy error in the sense of raising too fast now, i still think they made the

error two years ago when we had a stronger economy and they should have gotten us back to normal i think the challenge you have is if we believe as a, you know, nation that 2.25% interest rates is too much for our economy to stomach, what about this world's greatest economy thing i don't get it. >> but is everything fine? i mean, if we have decently strong economy and there's anyone to inflation, even this morning the inflation expectations was weaker. what's the problem why should they keep raise something maybe we're just fine, we didn't need them do that? >> look, 0 real interest rates or negative interest rates are too stim lative. >> we're not at zero. >> we're at zero real in terms of real interest rates and it's been negative for so long, and that puts too much stimulus in the economy. and like anything, if you take too many steroid shots bad things happen. if you eat too much sugar bad things happen. so we've got to get off the sugar high and go back to a normal economy with normal rates where businesses -- part of the

big problem is 14% of the s&p 1500 companies in last three years they don't cover their debt service they couldn't pay off their debt, they can't even service their debt we have all these zombie companies and we need them to go away. >> is that going to be a crash >> well, look, i don't think it's a crash. >> or a bubble burst, the corporate debt. >> when we were together the last time i came on and talked about it's not a crash like 40% to 50% tomorrow. everybody's worried about 2008 again. we don't have the leverage in the system again to have 2008. what we're more like is 2000, 2001, 2002 2000 the tech bubble was only down 9%. i think we'll be down single digits this year next year we had a shallow recession, first quarter negative, second quarter positive, third quarter negative, full year 1% we had a down 14 year. it was 2002 when the debt bubble broke enron, world.com, and that's the problem

>> when you were in hoctober yo said stocks were 30 to 50% above fair value. >> yes. >> how much has happened since then how much above do you think they are today. >> 30 to 40 more. >> we still have a long ways to go go. with the dow down 570 points today, there's more down side here >> lots more. >> lots more. >> i think it's over a two-year period i think we're going to go down for a long time just like '01, '02. and the difference between a bull market and bear market. a bull market goes down most days but goes up a lot on good news or perceived good news. >> like monday. >> yesterday was perceived good news. >> and like monday. >> but it's not really good news, it's just the perception bull markets go up most days but go down a lot on bads in or perceived bad news i think we shifted on january 26th this year from bull market trend to bear market trend and it's going to take a while to get back to normal. >> are you short this market

>> we are hedged because we always think there's an opportunity. we're about 40% net long, so we've got longs and shorts and we're long things like, you know, utilities and consumer staples and healthcare healthcare had a bad -- >> defensive tilt. >> yes and we're short the f.a.n.g.s. i don't like companies that trade triple digit pes. >> face sbook tradibook is trad times. >> next year, i always look at the last 12 months that's all we know they look at this year and say we're up 23% so we'll be up 28% next year. there's no way it's going to be up 28% next year. i look at the current 12 months zblerngs you tuck abo >> you should generally stay away from too many carbs why do you like them. >> i totally believe in the keto

diet carb stands for china, argentina, russia, they've sold off. they're really cheap if we go into a global slowdown, i'm nol not saying they're going to rip upwards but if you can look around the world and you want to buy equities, you don't want to hold cash and bonds and bitcoin, then you should own the things that are cheaper and emerging markets are as cheap as they've done except at the crisis in twine. >> and you think bitcoin's getting to a bottom? >> you think bitcoin is going to outperform the s&p over the next decade, right? >> the crypto challenge we did yesterday. we're issuing a million dollars challenge like the buffett bet. >> i wish i could take the other side of that a million dollars is a little --? >> well, both sides put up half and we fund it in advance. >> just half, kelly. >> and, look, we think over the

next decade we think u.s. equity will have no return. we think crypto is going to have a great return we're so early in this technological wave that is crypto price is very volatile but we're talking about technology like ios and android. >> everyone who listened to this six months ago has gotten creamed in crypto. >> look, things are volatile, right? nvidia is down 50% in the last 45 days. 45 days. >> i know. they tried to say don't make us part of this >> 45 days but, look, volatility is real. and all i'm saying is that for investors who want an asem metric return profile over the next decade, take 4% your portfolio, put is it is crypto assets i think it will outperform we're willing to put our money where our mouth and is whoever wants to take the s&p, the other side, pure beta, stocks versus crypto, next ten years, let's go. >> thanks. that was a fascinating

conversation all right, mark is morgan creek capital management's founder, ceo, whatever, he's in charge. >> he's in charge. coming up, tobackio giant altria buying a big stake in cannabis maker krone necessary to tech leads the way facebook, amazon, netflix all lower. why tech matters so much to the markets. and that stock support 37% in the last quarter defying the rest of the market could it be full speed ahead from here? that's a clue. we got the name straight ahead as we take a break, let's look at the dow 30 map. there's one name in the green and that's chevron up just fractionally we are useiol wsp ctnalo across the board. "power lunch" is back in two place, the xfinity xfi gateway.

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which plug in to extend the wifi even farther, past anything that stands in its way. ...well almost anything. leave no room behind with xfi pods. simple. easy. awesome. click or visit a retail store today. hi we are outside the courthouse in vancouver, canada, where huawei cfo meng wanzhou is having her court hearing. she entered the court hearing about one hour ago according to prosecutors, betwee an unofficial subsidiary called sky com to track activity in iran says that banks in the u.s. then cleared money for huawei but unknown to them they were

conducting business for skycom the prosecutor says that the c.f.o. personally represented skycom and huawei represented that they were operate when in fact they were not so the question now is whether or not she's going to be extradited to the united states. this is her bail hearing another question is whether she's released on bail or not. there has been some arguments from the prosecutor about why she is a flight risk she is saying that her state of living is in china she could be facing many years in prison if these allegations are prosecuted so we continue to listen the other thing that is being said in there is that meng deceived u.s. financial institutions and exposed them to risk of being fined. so a lot going on here remember, guys, this could be a pivotal moment in u.s./china relations schett not just cfo of huawei she is daughter to the founder huawei is an important chinese

company that its government and citizens are proud of. it's had a trouble history here in the u.s we will continue to follow the proceedings inside of the court. that publication ban i was talking about earlier was lifted at the start so we can bring you everything that naps there back to you. >> thank you tobacco giant altria announcing plans continue to investigate $2 billion in cannabis by taking a 45% stake in cronos. could this be a turn for them which is on pace for its worse year since 2008? let's bring in christopher christopher, great to speak with you again. >> thank you, you too. >> last time we talked this was just a rumor and now the deal is done do you like the terms of the deal and what do you think altria gets out of this? >> i do. i think this is a great transaction for them to the degree which this industry, cannabis is complementary to tobacco, which they believe, this becomes a great transaction. they get a cannabis platform and on top of that a global cannabis

platform one that is growing and has potential for significant growth going forward cronos becomes the second best capitalized cannabis company this gives the company a lot of opportunity go around the world and potentially the u.s. if the u.s. market would ever open up to build its business. >> this is an interesting move for altria because, of course, altria and philip morris used to be one company and philip morris is the international side, altria is the domestic side. here you're saying they're gaining a global cannabis platform so do you see -- i mean, does it need that? does it -- it's just an interesting way to go for altria which is so focussed on domestic operations. >> that's right. no doubt and if you think about what altria brings to cronos, it's, you know, brand management, it's regulatory affairs, compliance, those are things that can be used broadly around the world. but for the most part are, you know, their expertise is in the

u.s. market. you know, this is such a young and virgining category that i think altria can bring some of this expertise and thing like brand management is an example that can apply almost anywhere you're right about philip morris and they were tied together and they still have some ties. i don't believe that philip morris has an interest in the cannabis category. they've indicated it could provide some reputational risk to them. they're doing some aggressive work on reduce risk cigarettes right now and tobacco products i think philip morris is not going to be part of this agreement. >> christopher, to that point is it assumed that the u.s. is going to pave the way for cannabis we just heard that the president has a fresh nominee to serve as his attorney general does that change anything? >> it certainly could. and it's hard for me to speculate on that. but i would just say that if anything this gives altria the option i think they've got a potential to take full control over the next four years. i think it's reasonable to assume the next four yooels years we'll have a good idea of theprogression of the u.s. market towards full legalization

through happens through the state, perhaps a declassification of the drugs. we're not sure how it's going to happen here. but i think this gives them a nice option into that. and the degree to which the u.s. does not legalize, they have this opportunity in canada and globally. >> so one of the things we talked about about an hour ago was the idea that other kinds of companies are investing in this space. it may be the spirits companies. she suggested that maybe the pharmaceutical companies will be in here or the consumer package goods companies and now we see a tobacco giant coming in. who are the players who are going to be investing in that? is it going to be all of the above? >> i really believe it's all of the above. to the degree to which this becomes a legal market in the u.s. you're going to need food companies, household product, personal product companies, obviously tobacco companies. and the first movers have been the beverage industry are the ones that i think most fear the legalization profit duct and what it can do to their category i like altria because they come from a position of strength.

they're entering this category and it's a complementary category not one that runs the risk of taking market share from them i think you'll see this come across a wide spectrum of consumer staple companies given the growth of this category. >> duncan hines brownies, that's all i'm saying christopher, you got a great name for this space you're following. christopher growy from steep will, thank you. >> thanks, matt. >> let's get to oil which rallied after opec announced a cut. the energy stocks as well were one of the few areas of positivity in the market but chevron was down when the dow dipped below 500 point selloff let's see if the stocks are trading and whether you should buy my them. mike. >> thank you very much that is right. crude oil is bouncing today after opec and nonmember countries agreed to a production cut but failing to give energy stocks a meaningful lift just yet, the group seeing a big reversal today sharply lower as well over the past three months.

they're all sharply lower over that stretch are we due for a renewed energy boom or is the trade now a bust? joined by craig and mike of strategic world partners craig, is this kind of a broken trend that really has to repair itself for a long time or can the commodity itself carry these stocks higher for a while? >> we're overweight the energy sector at this point in time for a simple reason. it looks like a lot of the bad news is largely baked in when you look at the decline in the oil price we had seen and you look at the xle chart, you saw oil price fall at a much faster pace than what the stocks fell the xle charlotte has come back to a clear identifiable support and you're getting a positive divergence on the rsi. it's better to be buying the xle than selling it and that's what we've been telling our clients. >> mike, a lot of value investors are saying if you want to look at the cheapest or more

neglected stocks it would be in areas of energy is that something you might buy into >> well, we're neutral oil's been absolutely pummeled but not because of demand concerns it's been because of oversupply so if it was getting crushed because of demand, we'd be running away from energy stocks as fast as possible. the other thing is when oil prices were rapidly rising, energy stocks lagged and as they started crashing they were less affected they haven't had a close correlation with the commodity price which is unusual with opec cutting production were, we should see oil begin to trade according to demand and it could have 20% upside from here. we are neutral on energy stocks, though i do think concerns about a global economic slowdown are overblown at this point. and i think you'll actually see the deceleration in global growth moderate which would be good for oil and energy stocks within a sector we prefer a couple like ok-- a different

company. >> it seems they have rescued the crude price. we'll see thousand goes from here thanks for joining us guys for more trading nation follow us on twitter at trading nation. now to sioux for a cnbc news update >> hello, everyone here's what's happening at this hour des spri despite president trump withdrawing from the paris accord, there's a big presence at the u.n. talks in poland and one participant says that means the americans are committed to curbing climate change >> it's important that folks here in the talks in poland understand that there is a strong movement in the united states that supports the paris agreement that represents over half of the u.s. population. $10 trillion of the u.s. gpd that's still in the paris agreement and that supports

climate action. >> george papadopoulos was released from prison this morning. he spent 12 days in a federal prison camp in wisconsin for lying to the fbi he will be on probation for the next year, do community service, and pay a $10,000 fine and a spacex rocket has been recovered after missing its mark and landing in the atlantic ocean if the was launched in outer space on wednesday it carried a capsule into orbit sending supplies to the crew on the international space station. look at that. well, they recovered if the that's the news update this hour back to you. >> thank you, sue. the oil market closing for the day. let's go to jackie. >> oil pricing popping on the back of the opec cut 1.2 million barrels. it was roughly a 2.5% gain on the session. for the week we're looking little bit less than 4%. a cust some sort certainly expected the 1.2 million was a little more than investors thought they'd see but what a dramatic meeting and lots of waiting around on that decision.

negotiations happening inside opec and with the russians but buyer beware, these decisions do pop prices day of they don't always keep them higher indefinitely and you see some evidence of that. on crude we popped much high, he gave back some of those gains before the close here. guys. >> thank you very much, jackie coming up, volatility, volatility, and more unknowns. that is the world we live in according to coca-cola's ceo if that's true, then what does that mean for the economy? that's next. have a coke and a smile. a look at the markets right now. there you see them, the dow down 2% 2% for the s&p 2 2.5 for nasdaq "power lunch" back in two.

welcome back to "power

lunch. let's check on the markets wee slyly off the lows here. the dow had been down nearly 600 points and right now we're down by 505 points. the nasdaq is lower as well by about 2.3% and the s&p 500 is down by about -- there you go, 55 points. tech, consumer discretionary and healthcare are the biggest loser. utilities are holding on to slight gains all 30 dow stocks are lower led by microsoft, dupont and cooper companies and american airlines are your laggers. we're keeping an eye on the transports which are on pace for the worst week in nearly three years. half the sector is now in a bear market kelly. >> coca-cola chairman will be stepping down in april after 41 years. company. he joins sara on "squawk on the street" this morning and talked about his frustration with today's business landscape. >> volatility, volatility, volatility and more unknown more unknowns. it's -- i think just running a

global business is just getting tougher and harder it's getting more complicated. not just the environment of information, but also the sociopolitical dynamics aunder rot world a -- around the world are making it harder with more unknowns, more volatility, constant volatility with bigger increases both on the high end and the bottom end of that volatility. and so that's the world that we live in. and it's going to be here to stay i don't think it's something that's cyclical and is going to pass. >> yeah, investors this week are wondering whether they can trust the trump administration's negotiating process with china let's bring in greg, he's the chief economics comment tate for for the "wall street journal." and a senior analyst and commentator. good to have you both with us. greg, let's start with you headlines this afternoon about what may be happening inside the trump administration is that contribute together frustration of kent and other ceos right now or is it just

that trade is such a big issue they're determined to figure out what's going to happen with china and their supply chains? >> i think trade is not quantitatively a big deal in the economic outlook it's hard to get numbers over 0.1% in terms of a direct gdp impact, but there's no question it's like putting another layer of uncertainty on a lot of stuff that ceos and businesses have to worry about. you have brexit, the italian populous to worry about, strong signs of slower in the emerging markets. and from the economic data it looks like the u.s. is slowing as well. so you layer on top of that all the uncertainty, but what's happening is very important trade relationship and it's just -- you can't blame the, now know, median ceo from saying not a bad time to pull back and not take a lot of risk. >> greg, you think the suu.s. czech is slowing >> until this morning i would have said jobless claims, housing numbers were weak, a few other things but the employment report today really gave me pause i mean, it wasn't just a disappointment you saw a slack in a hree-mont

rate of growth a lot of internal details like the hourly earnings was across the board kind of a disappointment i would say right now that it is pore consistent with the economy's slowing to a more sustainable 2% pace from what was kind of a sugar high in the middle of the year rather than a recession. but, you know, looking the way these markets are trading, not just the dow but the fact that the cyclicals like transport are getting so beat up so badly, the yield curve almost inverting, i'm getting kind of worried. >> i would have thought, ron, this morning that this daughtera wou -- data would be enough to give us a hike which would be good news for the markets i'm a little bit surprised, i'm knot nomar k-- not a market punt what's your reaction to all of this >> it looks like a goldly locks number but this was going to be a double edge sword. if it came out too strong then it's an aggressive fed if it comes out weak -- >> then it's a weakening --

>> and greg and i may differ on the characterization of what happens next year, but growth recession or profits recession might be the thing that the stock market's most worried about. from the trade perspective, i think people are misjudging this this is a fundamental shift in national policy on the foreign policy front and the economic front. this is stephen bannon, steve miller, peter navarro. >> this is confrontation. >> coming from the belief that china is an economic and military threat to the united states, bannon's economic nationalism which is being spread around the world, i think, is sooghaving a profound impact on the economies around the world. it's not just a tenth% of the gdp it knocks off, it's the larger geopolitical picture. >> why, greg, did the post buenos aires rally lastexactly one day? >> well, i would say that first of all i don't think it's really china that is the main or the trade story that's the main driver here.

i really think it's been this slow drip, dip drip of month tear accommodation the fed has been shrink its balance sheet for the last year. you have europe and japan about to do the same thing you've had interest rates rise to the 90 cash is a genuinely reasonable alternative to stocks or a corporate credit for the first time in a decade that's got weigh on the pekt and we're seeing it show up in housing data as to what's happening with china, well, this administration is not known for exactly being state of the art in terms of its communications, you know i mean, my analogy for what happened is your teenager comes up and says i can have a iphone for christmas and you say i'd think about it and your kid runs off to your spouse and says dad said i could have an iphone. i said no, i'd think about chinese said we have issues, we'll talk on that, work on that

i think the united states ma have, perhaps, good headlines wanted to make that into something it wasn't. i don't think in the end the confusing message will be material we still need to find out whether the chinese can offer enough to satisfy the americans. we won't know the answer to that for several months. >> there's a 215 page paper that was written that chronicles all the complaints that the united states has with china, kind of difficult to discuss that in the course of 90 days. i would also say to greg's point, with respect to the lack of policy -- >> by the way, larry kudlow did suggest it could be more than 90 days the closer we get to looking to 2020 the more you wonder if the administration is saying, we either better have the recession now or we're going to make sure it doesn't happen during receipt election campaign. >> they don't have fiscal or monetary flexibility to wart that off should the economy weaken substantially and to greg's point maybe the european central bank, maybe the bank of japan starting to remove themselves they're going to do that japan third quarter negative, it's the

wrong time elsewhere in the world to remove that >> and oh, by the way, when the democrats control the house they're not going to make anything easy for this administration. >> although ironically if they wanted to spend a bunch of money, the administration might say go for it. >> we're in a trillion dollars deficit. good luck selling those bonds with the shrinking balance sheet. >> thank you, guys. coming up, netflix toumbles apple loses all of its gains we're talking the tech tumble next

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and welcome back to "power lunch. we are getting back to session lows here across the major averages the dow industrial down by 588 points we had been down closer to 600 so not quite there but almost. s&p 500 down by 63 and the nasdaq is down by 204 points or almost 3%. 2.9% is a loss there we should note that apple gave up 170 as a key level there today. morgan stanley is bullish just the latest of the analyst to throw in the towel citing chinese iphone demand weakness

we are seeing apple really contribute to these losses on the dow as well as the nasdaq. >> the nasdaq seeing the biggest loss today, down nearly 3% this is with netflix plunging more than 5% apple close to going negative for the year on the news line we have the senior analyst laura how fundamental -- we could talk about apple and the maturity of the smartphone market. it doesn't feel like that's what's going on now. what are your thoughts >> think what's going on we had a momentum market for a long time thankd we' time and i think we're getting back to a value based market now. so the stocks that have been such great overperformers for the year are starting to underperform and that's going to pull down markets. >> how much of the china slxt u.s. trade concerns impacts this sector obviously a company like apple with a supply chain is affected. trankly there's articles out there speculating whether american tech executives might be arrested in china as a result

of the huawei arrest in vancouver. do companies like apple need to be worried about that? >> i think what's going on is we're getting a lot of these stocks, especially if they don't make money like roku or netflix don't have profitability, so as risk goes and you we take our weighted average of cost of capital discounting up, all of those stocks get hurt worse compared to companies like apple and google i will tell you that facebook and google depend on advertising which is absolutely dependent on global growth. anything that raise tariffs hurts global growth. to your point about china, anything that closes off the chinese market not only hurts apple but really hurts the global demand curve for basically most of america. right? so i think that's what's going on in markets. my best performing stock today are the walt disney company, viacom and cbs, companies with huge cash flow and sort of predominately u.s. domiciles.

>> when you look at some of these other companies, if we are moving into or if we have moved into the sort of value investing theme market, can you be a bull still on netflix is that positive >> no, you cannot. for one thing, netflix must act as capital markets to stay sul vent they will lose $3 billion this year if capital markets start closing and capital gets more expensive it's bad for any company that must raise money. you want to go defensive go to high cash flow companies that don't depend on china or the eu depending on what you think happens with brex zblit in your universe of stocks that you follow, you mentioned a couple of them that fit that bill where you want to go with high cash flow, domestic focus, et cetera. >> yeah. so that would be like disney, fox, viacom, cbs, discovery is a nice choice. they have nice big cash flow --

and u.s. revenue streams. >> thank you very much have a great weekend laura martin is with needham and coming up, today's mystery stock up 37% in the last quarter and hitting a milestone today that could save it a ton of money. the name and why our next guest still has a hold on the stock ahead. ♪ ♪ (buzzing) gather new insights, leave your data protected on-site, and put it all to work with ai. the ibm cloud. the cloud for smarter business.

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tesla has kept its eye on the road it is outperforming the broader averages it could be a good sign for the company and has a sign to pay back some of its debt. joining us now is james the consumer edge. great to have you with us. >> thanks for having me. >> you want the company to do something about corporate gov n governance >> i think for the foreseeable they need to prove there's true independent sort of checks and balances between the board and senior management. i think they need to start investigating and maybe bringing

on a really seasoned operator. ealon proved he has an unbelievable company and brought a company that has resistant to change for many decades. it might tyke a different skill set to manage what is now a mass market, you know, sot of 35 to $50,000 vehicle. half a million yununits a year manufacturer we are looking for signs they are embracing that concept and from the fundamentals. >> it certainly was a problem. i don't think anybody would say it wasn't a problem throughout the funding secure tweets. but all throughout this time there were actually data points. there are data points that indicated tesla was able to operationally fulfill a lot of targets. if you were to believe the internal e-mail that they hit a thousand model 3s a day which

would make the 7,000 target a week within reach. it is performing operationally at what point will you say that the stock is moving ahead operationally even though it doesn't have the corporate governance >> yeah. and we took issue with the solar city acquisition a couple of years ago. even though we defended the stock there are significant execution hurdles ahead. you know, building out the model 3, obviously it seems to build b building into the races. it is a monumental undertaking the semi truck, you think of the pickup truck, service and infrastructure and sales and on the other side as well so building out a global

enterprise here. we think there are execution related hurdles there. if you look into the fourth quarter they have tremendous pricing. it will ease into a slower transaction price. the question of how much of the fourth quarter did they pull in i think is top of mind for some investors as well. you want to be cognizant of where we are in terms of the evolution of the company i think we are more positively inclined it is a long overdue call for more streamlined focus on operations and corporate gove governance >> i like to see who the two new directors that they nominate will be and what their backgrounds are. i think if they continue to sort ofaccelerate from the fourth quarter it does derisk the concern and pulled ahead pricing

in the model 3 if they do reach a new ground in the immediate term and were proven wrong we would have to reevaluate >> great to see you. >> thank you >> and still up on wall street intensifying this archs. t -- afternoon. the president is reportedly glued to the stock market this week more than 4% now here is a look at the s&p. best performers, are utility companies. we'll have much more on this big selloff straight ahead [leaf blower] you should be mad at leaf blowers. [beep] you should be mad your neighbor always wants to hang out. and you should be mad your smart fridge is unnecessarily complicated.

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welcome back it went down another couple of hundred points in the 55 minutes or so since we began >> yeah. i'm watching it very closely apple turning. it has given up 170. when you have one of the biggest bulls on wall street saying i'm dropping the price target because of china weakness then

that's something to pay attenti attention to >> interestingly when we had this earlier in the week it got better that's not the case today. >> definitely not. >> hard year to make money >> yeah. >> stocks or bonds orb bitcoin closing bell right now good afternoon welcome to the closing bell. i'm wilfred. not a pretty picture in the market markets down sharply at session lows right now just down on the dow. the high of course was positive territory mere t territory near the open. we are down 2.5% the nasdaq down more than 3% all of the major averages on pace for their third