trade yesterday, and i like slv. joe picked gold. i'm picking silver upside call buying in silver today. >> we'll call that the berl ives trade. thank you. "power lunch" begins right now thank you. i'm melissa lee. the bears are back stocks hit again after the biggest one-day point gain in history. time for some tums and portfolio protection and the double downgrade taking down semistocks today. this sector taking a beating the past three months. down 20% and selling your stock losers on purpose. sounds counter intuitive, but investors are doing this all across the market. smart strategies to ease your pain "power lunch" starts right now ♪ welcome to "power lunch. i'm kelly evans.

yesterday's huge rally is becoming a distant memory. the dow giving back a huge chunk of yesterday's gains today we plunged almost 530 points at the lows, we're now down about 350 the nasdaq falling back into bear market territory. all three averages are on track for their worst month since october of 2008. f.a.n.g. and the other big tech names are having the most impact on the nasdaq 100. more on that coming up declines of 3% for those major names. there are some small bright spots. newmont mining, redhat all higher in this pisani joins use floor of the new york stock exchan exchange we're back to 3:00, 2:30 levels of yesterday >> yes, i know before that enormous blowup in the market. it's unclear what's happening. i think that's good news let's look at the s&p 500. we are meandering around just off of the lows for the day.

there's been no dramatic attempted attemp to sell off the market there's also been modest attempts to buy the market that have not been convincing most of the major sectors are down about 1.25%, 1.50%. energy is the decliner, along with consumer discretionary and tech staples not so much. where are we now that's what i'm trying to figure out. i'm not sure if we're in sell the rally or trying to buy the dip mode until this morning every rally was sold into. i was always in sell the rally mode i'm not sure how this will end up today that's a little bit of a change in sentiment, a bit of brightness if you want a negative sign, hold the lows that we had yesterday. that was 2347. that's a long way from that. this week, we end below that any point in the day the next two days, that is a negative sign here. remember the hopes for the year-end rally i bring up pension rebalancing,

buybacks, the end of tax law selling an short covering. been calling around talking to short selling friends, isa market tracks the short selling, got some new data coming in in the last day most shorted bets have done well shorting stocks have done well the most shorted names are down 17.5%. the least shorted names are down 10.8%. that's a profitable month for short sellers. yesterday there was some element of short covering that was part of that overall rally. hard to give it an exact number. clearly the most shorted names had the biggest rally. that's one of the fingerprints you look for for a short covering rally we'll see how the market ends up today. >> bob pisani, thank you it appears trade talks are back on, but this comes amid reports of an executive order from president trump that could add another wrinkle. ylan mui is at the white house to explain this is an administration that likes to use carrots and sticks.

today was a great example of that first reuters reporting that the white house is weighing an executive order that would ban companies from buying telecom equipment from huawei and zte. this is an order that would have to go through the commerce department and it would require the president to use a rarely deployed power that allows him to regulate commerce during times of national emergency. that news comes just as it looked like trade talks between the u.s. and china were moving to the next level. there are multiple reports that top officials from the u.s. trade representative office as well as the treasury department will be heading to beijing during the week of december 7th. there are also reports that china appears to be taking new steps to curb forced technology transfer that's one of the big complaints from the united states now we have not heard much from president trump since he got back from iraq early this morning. he's tweeted twice so far. one of them was on the shutdown. he wrote this, have democrats finally realized that we desperately need border security

and a wall on the southern border now the senate is set to reconvene at 4:00 p.m. today there are no votes scheduled in the house and that means the shutdown will last at least through tomorrow national parks are still closed. trash service could be affected. the white house says that homeland security secretary kirstjen nielsen will be headed to the mexican border tomorrow so that's a good sign that the white house is not planning to back down on its demands just yet. back over to you >> thank you >> china unveiled a proposal, foreign investment proposal in it there's a ban on forced technology transfer, one huge want in terms of the president's list when it comes to trade talks. is that seen as the chinese giving in a bit? showing willingness to stop that practice >> perhaps it looks like china is taking steps from buying soybeans to this new legal authority that you just mentioned the question there is

enforcement. china has said before it would curb these practices, but how do you ensure it's done so? that's part of what these negotiations are going to be about in early january >> all right thank you very much. the markets have been on a trip to nowhere this holiday week the dow was down more than 600 points on monday yesterday that 1,000 point gain. when you add in today's losses, he would could end up back where we started from. what should investors make of this volatility. joining us are peter anderson and brack mcmillan welcome to you both. >> thank you >> peter, let's start with you this week has been a wild one. zooming out people are wondering if the sharp selloff is over are there opportunities for investors here >> i think there are the best doctors in the world always send their patients home with a plan. the main reason people are confused is that there don't seem to be plans i think we're doing a fairly

weak job at giving divisive or decisive -- more divisive lately, decisive plans on what an investor is to do, rather than talking at 10,000 feet of altitude, let's look closely the way i do this, i talk about individual stocks, highlight which ones are trading at enormous discounts and i say this is the proof that things are still very, very attractive >> so what do you like >> united rental equipment company. that stock is trading at a remarkably low pe of five times forward earnings earnings are predicted to be in the double digits. on top of this maybe you get pushback saying the economy won't be growing as strongly as it did my answer is to what even if the economy slows down a little we have a tremendous growth opportunity here with stocks trading at such discounts. >> brad, you say big bounces are

as bad as big drops, are you not quite ready to start deploying capital? >> i'm not ready to declare victory yet. when we see this volatility as bob was saying, it's basically the market saying what the heck is going on. the market doesn't know, and i think it's a positive sign we saw that bounce back, but it's going to depend what happens the next couple of days. this may be the pause that kind of brings the market to its senses and sends it back up. we're not there yet. what will convince you what signs are you looking for to say it's time to go after the names on my shopping list? >> i think we need to see the s&p go back above the 400-day moving average at a minimum. that takes us out of the immediate danger zone. that's something we need to see before i personally will take a more optimistic look >> how about the consumer confidence this morning? there's a lot of people focusing on the fact that expectations dropped, people expecting more

jobs that number dropped. we've also seen confidence shocks like this before, especially in 2011 is this one for real >> it's uncertain. i'll tell you, i think the problem is when we start talking negatively, then the anchor usually says should we sell? you are recommending to sell awful the stocks that you own? most advisers are saying, no, no, i don't want you to seat belt stocks you own, but i'm not certain you should buy any therein lies the confusion and adds to the volatility i think people need direct actions to take now through january and february so, for instance nn in my case, run a 19 stock portfolio i have not sold any of those ou or or if you don't like the holdings anymore and you're selling into cash. very few investment managers are saying i don't like the market so much i recommend all of you

going into cash. that is a better piece of advice than a wishy-washy balanced explanation of well maybe the market is not too hot, but it's not too cold, so in the end i'm telling you i don't know which direction you should take. >> it sounds like you're saying brad is wishy-washy. >> it's not personal >> so you are saying that. fair point but at same time, i think a lot of people would have said, oh, you can get these stocks at a discount you could have said that a month ago. you could have said that in the depths of the selling in october. that is a risk too, that you're giving direct instructions, and it's not going to be wishy-washy and you have to suffer for some time >> i know. but i think you're implying calling the bottom on this i was saying this a month ago. i'm not saying you can declare when you're getting at the absolute cheapest. for the past three months things have been so cheap that i think it's tremendously attractive

they might get cheaper last month, but it's better action than saying i'm not sure what to tell my clients. >> brad, last word what would you tell your clients? if you're worried about the way the market is now, de-risk your portfolio. this is still normal volatility. given the fact the economy is still solid, we're probably going to recover in reasonably short order. if you're worried about it, you're probably taking too much risk >> good, actionable advice from both of you. thank you peter and brad. a news alert now in the bond market a record amouptd nt of seven-yer notes are up for auction yields are pretty low. >> this is best of breed, 2.68 was the yield at this dutch auction for a record sized 32 billion seven-year notes, the grade "b." "b" for demand straight up at 1:00 eastern i'm shocked that this auction

actually went so well. the bid to cover 2.46, just a hair below ten auction average 67.4 on indirect, best since january of this year well above ten auction average, and directs 14.6, also above ten auction average. dealers end up with 18%. so i gave it a "b. we have 113 billion of new coupons supply in the hands of investors. and this comes at a time of high market volatility, so we will garner some clues to see ultimately how supply, debt and deficits play out with a softer interest rate and a volatile stock market kelly, back to you >> thank you, rick santelli. oil giving back some of yesterday's gains. which companies are best positioned to deal with these wild swings? we'll get some energy stock picks. and every day is a totally different story for the markets. down 600, up 1,000, down nearly 0 toy.

no matter where things go, it happens during "power lunch" and we'll be all over it after this.

on the back of yesterday's monster surge, it was just l lipstick on the pig that is energy this year with us is mike kelly from

seaport global securities and brian sullivan, our energy maven. it's a compliment. expert our in-house expert. mike kelly, going to you first what was yesterday's rally in you'd all about? was it short covering? >> maybe a bit right now you saw this in the last segment that energy is so tied right now to the health of the economy. the fear right now is demand will fall off a cliff. we've seen insanely positive results, but oil sprays prices slipped from 55 to 42. >> do you think the demand is out there? it seems like a lot of other data points -- we can say oil is a product -- the price is a product of supply and demand fundament fundamentals, then you look at aluminum, it's at 20 month lows,

nickel at 14 month lows, the rest of the complex is confirming the move in oil being because of weakness in global demand >> the supply demand, just anything on the margin if all of a sudden it's oil demand grows a million barrels year after year, and if you throw a wrench 234 thin that, a sudden all bets are off for oil prices 45 will seem like a nice lofty target if we go negative on oil demand next year only had that happen three times in the last 30 years, but it's nasty if it happens. >> if it doesn't go negative, people say there could be shortages out there. >> here's where everybody screwed up, by everybody i mean me we didn't know this the treasury department granted these waivers for eight countries to buy iranian oil. when the iranian sanctions kicked in, the president was

saying let's ramp up production because we'll have 2.5 million barrels coming off the market. quietly countries like south korea and japan said we need to buy iranian oil. grant us this waiver eight waivers were granted the point is there's a lot of iranian oil being legally still sold >> is that enough to account for a 30%, 35% drop? >> yes because the marginal barrel is worth zero if you go up to canada you can get oil for free if you can get it out natural gas in partsd of texass almost freechlt we ha the marginal barrel clapollapsed the tirn pric the entire price >> the one i like is diamondback energy if oil goes to $15, these guys are the last emp standing here

the low-cost producer ultimately wins >> even if oil goes to 15, f.a.n.g. is okay >> i said they're the last man standing they're not going out of business it's still getting crushed even if we go to 15 even i'm not that naive to think not. but the lowest cost provider, diamondback is there another company we love that got crushed is pdc energy, they trade below the blowdown value fire everybody at the company, let the wells pay out. stock is close to 29 right now we see that with a major catalyst coming in q1 with them. >> i don't understand, mike -- we can throw it around to melissa also, how do you run an oil business in this day and age? put up a 20-year chart of crude oil. we went from 20 to 140 down to 130. >> put up a six-month chart of oil. >> fair enough

>> that's how much it changed. >> you can imagine if you're procter & gamble and the price of your swiffer or tide changes like this every six months how do you manage your cash flow >> that's what makes it so much fun. you have to throw hedges on the books. that's one thing we're looking at now who has the best hedges in plac for 2019 that's important brian, we talked about this a number of times on the show. it's the u.s. producer that has caused all this volatility this is -- i don't care what anybody else tells you they're the reason we're at $45 oil now. we have grown production in the u.s. 2 million barrels year over year because of the shale players. >> final question before we let you go, halliburton is one of the names trading at 15-year lows is that justified as far as you're concerned >> the oil field service, our guys will tell you schlumberger looks compelling now the data points in the near-term

won't be supportive of them. one thing we're seeing, five of my companies under coverage, put out press releases last week that said we're handing rigs back we won't drill at these levels it's not good at activities and oil field service companies, but longer term they look like compelling values. >> mike kelly, thank you brian sullivan, our in-house energy maven which means expert or connoisseur >> you're welcome. >> the s&p 500 is suffering this morning in the trading session as we head to the afternoon, the dow is down 419. the s&p is down about 48 all of the components you can see are overwhelmingly lower with the exclusion of about a dozen names. how about some of those gainers? ratheon, lockheed martin and northrop grumman can the defense stocks outperform in 2019 that's coming up on "power lunch.

2018 has not been a great year for anybody including defense stocks the etf tracking the sector is down 11% is that a bad sign for 2019? morgan brennan, our defense maven is here now. >> it could be a bad sign. it's been long seen as a defensive investment defense stocks became one of those so-called trump trades that unwound this year incredible that for fiscal 2019 the defense budget is 7$716 billion. not affected by the current government shutdown. but next year it does look like it may not get easier for the

sector the 2018 year marked the start of the military's rebuilding as the d.o.d. dolled out big contracts, sales to allies surged, and the space force shifted from sci-fi fantasy to on-paper proposal but 2019 may be tougher. first, peak defense dollars. brace for a spending showdown as the pentagon proposes a bigger budget and some officials balk the wildcard president trump who wants a stronger military and more recently called for budget cuts. what should keep spending strong a u.s. defense strategy focused on china and russia. second, government i.t. faceoff. a tight labor market a shift to the cloud and the adoption of ai will fuel a race for more of the $250 billion government services market. expect continued m&a on government contractors looking for more for less and

contribution from big tech as amazon, microsoft and others seek out high-level high security work. and third, hypersonic hype russia has them, china has them and the u.s. is developing them as well. hypersonic missiles. the u.s. can't defend against them so attention will turn to r & d and to long discussed concepts to add sensors in space, something once farfetched until startups began making space cheaper. just yesterday russia said it's ready to deploy a new hypersonic missile system which vladimir putin calls invulnerable to u.s. defenses, and they could reach the u.s. flying at the quif len equivalent of 15,000 miles per hour we'll be talking more about missiles and missile defenses in general in the new year, don't

forget the u.s. is seriously considering pulling out of that imftreaty with russia as well. we have this new congress coming to work on january 3rd and we could see faceoffs as well in terms of what nuclear policy and nuclear modernization means. >> we'll are focused on the budget numbers of this year, i don't see thin this era how we won't be in a global arms race >> that's a key point. we talked about the nuclear arms treaties that we have in place with russia. we don't have a treaty like that in place with china. so there is essentially -- you can make the argument this technology race, this arms race happening on the military and security side that doesn't necessarily involve countries that have become more dominant since those treaties were put in place. we'll have many more conversations about that the key -- this is why you've seen defense stocks sell uf as much as they have, how much money we put towards all of

that whether we are at peak df spend i defense spending going down. >> that's the growth rate going down, in terms of the absolute number going down? >> right now we have 7$716 billion allocated to defense for fiscal 2019. working on the proposal for fiscal 2020, we expect that in the february timeframe the expectation was they would propose 7$733 billion we have had president trump and others say they want to see that go down to 7$700 billion >> so there could be an actual cut. >> yes >> morgan, thank you. here's what's coming up the dow smashing a record for the biggest point gain which was set during the financial crisis, was it a one-day blip? and last-minute tax tips, what you may need do this week and we'll talk to an analyst who cut his prices on some big chip names.

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i'm morgan brennan, here's your cnbc news update. saudi arabia's king salomon issuing a wide ranging overall of top government posts, including a new foreign minister this following international fallout from the killing of saudi writer khashoggi cash. al assaf was the long-time finance minister. in peru, a bus left the road and crashed into a river 10 people were killed and 30 were injured the cause of the accident is under investigation. the fda approved a new vaccine that protects children up to 4 years ole against six diseases the vaccine is designed to prevent diphtheria, tetanus, whooping cough, polio, hepatitis and hiv, a type of bacteria that causes serious illness. barack obama and michelle obama have been named the most

admire admired in america michelle ended hillary clinton's run of 17 years. sending it back over to melissa. >> thanks, morgan. let's check on the selloff at this hour. the dow giving back a big part of the historic rally. down 427 points a loss of 1.9% despite the crazy moves over the past several days, the dow was hovering near break even for the week the nasdaq is falling the hardest of the three, down 2.4%. tech is one of the big drags in the selloff. jackie deangelis is tracking that >> you're right. as the dow continues its decl e declines and they get steeper, so goes the nasdaq right now looking at a 2.5% decline on the nasdaq composite. let's start with some of the biggest losers on the nasdaq

100. with losses of 5% or more, stocks like amd, tesla and wynn. a couple of bright spots i wanted to point out. yesterday it was green across the board with one red stock today we're red across the board but there are about five green stocks that you should look at applied materials, jd.com, micron, kla, ten corp and ctrip. a lot of folks are saying the selling is momentum selling. it's broad based they think once we turn the page on the calendar year investors will cheer up again. fourth quarter earnings reports will bring some confidence back into the market. as you have been talking about all morning and all afternoon, this is a time, the holiday period, where the volumes are low. so moves that we make in either direction seem a bit more pronounced than they would on a normal trading day back to you. >> thank you very much, jackie deangelis. it has been a wild week on wall street. we saw the worst ever christmas

eve for the markets followed by a 1,000 point gain on boxing day. today the markets are selling off again. all three major averages are on pace for their worst month since 2008 how important is yesterday's market milestone let's bring in ron insana and jim urio welcome to you both. ron, what stat to you tells us the most about what's going on >> well, yesterday's 1,000 point gain was still not in the top 50 percentage moves in the history of the stock market, as carl quintanilla pointed out this morning. these things happen. the jury is just still out as to whether or not this was a bear market bounce or whether we're in a bottoming process we have come down enough to discount negative news next year do you think we're oversold? >> certainly in the short run. >> the dow below its 200-day moving average for the 15th straight session the dow in correction territory, 15% off the highs.

had the worst monthly performance since february'09. others could point out other things >> there's as much involvement of time as there in price in a bear market move that's where i think we are, a bear market. just working through the timing need to repair the technical damage done so far >> markets overshoot to the upside, they overshoot to the down side, jim, where are we on the down side? >> everyone i talked to today, a lot of smart people in the financial world will tell you those 5% rip your face off rallies are actually part of the reason you know we're in a bear market those are vicious rallies, and they are indicative of a bear market situation there's also several different times where 5% moves marked a significant low.

the fact that it's christmas week, the fact that the volumes are low, i don't think you can put a ton into it. when this became evident that there was a bear market, i had a hard time thinking we would get out of this without the standard 20% correction level in the s&p. as of month morning we got it. do i think it's over i think there's a chance it's over, but we have to see how this plays out the next couple of days. the rally was nice if we can't take out those highs and trade above those highs, that means nothing the tradable thesis is when it goes above yesterday's highs in the s&p, feels comfortable there, maybe i'll talk about it being over >> do you believe in the santa claus rally, which should be this time now between christmas and new years? >> yes, i do but every time -- a lot of people have money to put to work at the end of the year people are investing bonuses any time -- it's like the sell in may go away thing when we talk about it too much,

that's an indication that it won't work as in the past. when too many people get to one side of the boat it doesn't work out well yes, i believe stachlttistically it happened. does that mean it will happen this time? i don't think it's going to. this is the anomaly. >> all those seasonal things we talk about, they usually happen earlier. this time a santa claus rally didn't happen at all so we're not even talking about it being pulled forward. we're talking about it not happening. in yesterday's session, it was interesting that some of the most shorted stocks had some of the biggest gains. >> it tells you a lot. >> exactly >> short covering rally. it's funny i can't prove it, i was at a friend's house, i said we're due for a rip your face off rally where everybody who is short just gets crushed in an instant. and then you determine post that experience whether it was indicative of a bottom or just a short covering blistering rally that hurts everybody exactly at the wrong time has everybody off balance, and then you started down again.

that seems to be what we're doing. we can close higher today. you never know in an environment this thin. you never know what headline that could come out and move the market so it's a tough call i still think we're in a bear market i think there's more to go on the down side. we need serious positivecatt catalysts in the market to do somethi something. >> every time we mark a bottom, it begins with a short covering rip your face off rally. so like ron said, the most important takeaways here, we have to see how it responds today, tomorrow and into next week when participants come back >> guys, thank you both. >> thank you >> rip your face off rally >> yes >> which i think we said ten times in the span of five

minutes. >> i want that whole brad pitt transplant that would be nice. 2018 has been a great year for epic games, the company beheight fortnite. tonight epic becames made 3 billion in fwrogross profit thi year the money is coming from the billions of dollars of add-ones. >> even highly paid athletes are playing it and giving up sleet to do so here's what the knicks coach told the athletic. fortnite, he said, that's my toughest competitor. it's tougher than the boston celtics. fortnite is undefeated >> fortnite is a tough competitor for social media networks when you see a decline in core facebook, trends not that strong, you have to wonder what is pulling people away from that >> reed hastings said his biggest competitor is sleep. when the professional basketball players are not getting rest because they're addicted to this video game --

>> or the kids teachers. >> oh. >> it's not just the kids. >> absolutely. >> that's troubling. >> $15 billion valuation. $3 billion in profit for all of that. we're three months away from tax time but now is the time you have to make decisions to save you big bucks for 2018 we have some tax tips mi ucongp on "power lunch.

you still have a few days in the calendar year to plan a tax strategy for 2018. if you have stock market winners now may be the time to sell some losers leslie picker explains >> it sounds counter intuitive to sell losing stocks.

here's how it works. people will sell stocks at a loss to make a dent in any capital gains earned from other investments this year. capital gains are taxed at 23.8%. these savings can be significant for investors. tax loss selling as it is known is likely feeding some of the recent market downturn, experts say. it's difficult to know the extent to which this tax loss selling is having an effect. but the more people are sell nothing this market for tax purposes, the more exacerbated the market declines. the one caveat is the so-called wash sale rule which prohibits buying the same or similar security within 30 days before or after that tax loss sale. the deadline to harvest losses for 2018 is december 31st. the question is whether that will put additional pressure on the market in the last three trading days i guess now two and a half trading days >> leslie, thank you. what are some more ways to save on your tax bill?

here with some tips is the director of financial planning at frances financial planning. leslie was saying sell your losing stocks to offset capital gains. people are probably thinking in their portfolio i don't have any -- i don't have gains right now. you think about it more broadly, correct? >> that's right. i think there are two things that i want to talk about. first is that even if you don't have gains this year, you can take part of those losses on this year's taxes return, so you could take up to $3,000, and then push or carry forward the remaining losses for profits that you make in 2019. you can use it as a tax strategy in 2019. >> you would save some of those losers, so to speak, sell them in 2019 or sell them now and push that forward? >> you sell them now and if you have more than $3,000 worth of losses, let's say you have 10,000, you take 3,000 on

the 2018 tax return and push 7,000 to the 2019 tax return >> and the appreciated stock you could donate directly. not that people have a lot to of that to worry about, if you've been in the market for several years and wanted to avoid taxes on that, you could donate it >> that's perfect. also think about bunchi ining donations. with the tax result change starting this year, the standard deduction increased significantly. so if you make small donations, then you may not be able to cross that hurdle. so if you think about donating every alternative year and save those donations for one year to take more of a bang for your buck, then that's a good strategy that heapfulopefully gets you or that hump. some other things to think about are 529 contributions, especially in states that have a deduction for those contributions. i know onnecticut, new york ha

a deduction. and i'm sure there are other states as well so it's a great time do that as well what are some other things the clock is ticking >> yes >> so what would you say, aside from those things, the donations that you wanted to make, tax loss selling what are some other things that need to be done by the end of the calendar year? >> as far as taxes go, with all the tax loss changes, the deductions have reduced. they have gone away significantly. there is not a whole lot but you need to think on a broader term, you mentioned before, right now is a good time to think about with this huge change in the market, it's fallen more than 10.5% since the beginning of the year, some of the target allocations that you have had have moved, so your actual investments in, let's say, the u.s. equity space may be far below where you targeted them to be and this is a good time to see,

okay, i do need to switch gears? can i sell some of the places that have -- investments that have more of an allocation and pull them back and put it towards something that is falling short of the target. >> curious about cryptocurrencies i actually learned that they're not subject to the wash rule, which is interesting but also for people who have big losses, if they maybe got into it in january and are going, geez, is there any way they can combine -- take losses there or are the rules in crypto totally different from the stock market? >> no, it's the same as any investment you would sell that investment holding, and then you can play it against another gain that you have had or carry it forward to next year as i mentioned earlier. >> that might be a blessing in disguise >> it might be >> avani, thank you for the tips. chip stocks getting wrecked today. up next, the analyst's call on amg a amd and nvidia is adding to the

slide. and just how healthy is the u.s. economy right now professor liesman will tell us coming up on "power lunch. this isn't just any moving day.

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welcome back the dow is at session lows, down nearly 550 points right now. a 2.3% drop. down 538 apple, microsoft, united tech and boeing is leading the declines >> chip stocks are tumbling. advanc advance micro and nvidia down. mitch cut his price target and advanced great to have you. >> thanks for having me. >> these are specific calls. in terms of what is driving the sector just more broadly, mitch, what would that be in your view? >> i would say more broadly nothing has changed from a couple months ago. we talked about semi conductor volumes coming down. we downgraded the semi cap space in june. it's typically a leading indicator for semi volumes it's going down. i think near term nothing has

changed yet in the sense that semi volumes are going down. specifically to amd and nvidia we cut numbers because mining chips being taken off are being sold in the used market now. e-bay, amazon, you can see the chips coming online. and they give everybody kind of a rough number to think about. back in december of last year you couldn't find any discounts. everything was essentially selling at a premium to retail prices right now you can get every single item for essentially 40 % off retail that probably means less revenue for the quarter. it doesn't change anything about the long-term story. it's something investors need to pay attention to >> it's an interesting change over the past year when you took a look at the demand for the gps back then it was off the charts. it's a different story now what i don't get is for example for nvidia, nvidia never wanted to make it seem like that was a big part of their business

in fact, the ceo would go on the call and say this is a small part of our business we don't want anybody to extrapolate this why was it that wall street on its own seemingly decided it was a big driver of the business so when that business fell off, the stock fell off a cliff >> the quick math is this. amd and nvidia were talking about $100 million per quarter in crypto. that gets you to 250, maybe 300. when you add up the entire value of the gpus for the last two years, we get to a number of around $2.5 billion. essentially that would be around closer to 500 million. there's a 250 to $300 million hole split between amd and nvidia that people mismodelled essentially that's now coming out. i think it will be another quarter of lower revenues because you're seeing the discounts of the market today. after that you'll finally be through the six-month pain

period >> mitch, the gaming front, we just spoke about how well fortnite has been doing. is it because of their success is it cannibalizing competitors or what's going on with the weakness you're seeing >> is weakness, again, is more just on the secondary market essentially if you can buy a gtx 1070 at a 40% discount, it's unlikely you're going to buy the new one. you'd buy the older one that still has a two-year warrantee and as long as the chip wasn't overclocked and lost the warrantee, you can still use it. essentially it's not that the gaming demand, the core gaming demand slowed down at the end of the day, people are playing games like fortnite. but when you look at the types of chips they're going to buy, they're going to probably move to the near term because they're going to get the same chip at a lower price. >> the used market, back to crypto i'm curious. you've put out a report and

follow bitcoin and the miners. i'm curious where you see bitcoin going. part of that is going to impact whether or not there are more miners coming offline which puts more chips on the secondary market it's a vicous cycle we're in >> as you guys know, bitcoin isn't related to the gpu it's z cash and the other crypto currencies mined with gpus in january of 16 we'll see the con stan teen update you'll reduce the blocker ward from 3 to 2. that's going to put additional pressure on the rewards for miners essentially when you used to get three tokens every month, instead they get two the profitability of the gpus goes down again. i think this is going to last for at least another quarter or so >> all right mitch, great stuff thank you very much. >> that was really interesting

figuring out how all the dynamics works amd is down 50% from the peak. down 8% in the market today. dow is down. you'd think this wouldn't be a good time to go public if you were a privately traded company but could the big tech unicorns like uber ipo next year because of the market weakness we're going to talk about that plus 2018 was the year that sports gambling went mainstream. could 2019 be the year it really takes off? power lunch is coming right back

here's what's on the menu. what a difference a day makes. after the dow posted the largest point gain in history, stocks are back in sell off mode. dow down 532 with markets suffering and fears bonuses are going to fade, are we about to see cracks in the high end real estate market? and brexit, elections, trade wars a look at the big international themes for next year and what they'll mean for your portfolio.

nick lowry is the only player in the green. he'll join us to talk about his picks which include amd and his predictions. power lunch starts right now >> welcome to power lunch. pulling back after yesterday's huge rally today's losses for the major averages are the fifth and sixth sessions the nasdaq back in bear market territory. the subpoena subpoena a point right now off of session lows. every single sector in the red right now. beare being led lower by consumer discretionary and services apple, microsoft, united technologies and boeing the dow laggar laggards the fang stocks, facebook, alphabet, netflix, amazon all down more than 3%. let's get more from bob at the new york stock exchange. bob, close to session lows now

>> yeah. an hour or so ago i would say it was a little bit undetermined where we were going. now we're at the lows for the day. would have a rally but not looking promising. look at the s&p 500. the levels to watch is the lows we had on yesterday. that would be 2347 where are we right now an hour ago i would say i wasn't sure if we were going to sell the rallies or buy the dip the market hasn't closed yet we could get a rally on the day but right now we're near the lows as i said before, put up the full screen. keep an eye on 2347. that was the low yesterday next full screen, hopes for a year-end rally pension rebalancing, buybacks. the end of tax loss selling. we saw evidence that was happening the last couple days and, of course, short covering that's going on. new data we got today from ihs markets, those people who are

out shorting stocks in december, well, so far it looks profitable for them down 17.5% this lends credence to the idea that part of yesterday's rally was due to short covering. back to you. >> bob, thank you. now key economic data coming out this week including a big drop in consumer confidence this morning that may have rattled markets. steve liesman has more about what this is telling us about the health of the economy. >> little doubt the data is softer the question is whether it's indicating a slowdown or a recession like the markets fear. we're going to do a deep dive into the data. retail sales, that's an important indicator of the control group. beating estimates. home sales surprising to the up side and beating estimates auto sales down a little bit from the last one. but beating estimates and at a high level that's kind of the good news let's look at the next chart here you can see there's a lot of red arrows down. jobs weaker than expected.

missing expectations some of these fed manufacturing surveys have gotten a lot of attention. richmond, philly fed all coming in lower business investment has not kept up small business confidence and consumer confidence, and that's where i wanted you to deep dive. look at the consumer confidence canary how good a job does it do indicating recession you can see the shaded blue lines are the recessions we've had here and here. and before each one we go to the next screen here, you'll see it does peak and start to come down 10 months prior in 1989. seven months prior and here six months prior to the '0 7 it's a big range it's not necessarily where the confidence number tells you when you get down to a certain number there's a recession. right now if you wouldn't mind, mr. cameraman, just zoom in on this gold piece. go back. they didn't do that. all right. anyway, that gold piece, if they

have it. it just shows a slight decline of ten points. the other declines, let's zoom in this is the decline that everybody is concerned about right here if we can zoom in there, here we go that's the decline we've had you can see we're at a high level. and it has to continue for quite a while longer kelly, you look skeptical as you should hold on. we'll come to you in a second. first, i want to put all this data into the hopper and show you what economists are looking at here's our rapid update. tracking 2.9%, we're well into the tracking we have a lot of data for the fourth quarter, and we're still near 3%. and this is -- there's no tracking data. this is the estimate for next quarter. still 2 .8%. this is a 2% potential economy why the difference between markets and economists i would call them the x factors like fed rate hikes and their impact the impact of the government shutdown and t

shutdown a report suggesting the shutdown could cost between .1 and .2%. tariffs .1 and .3. maybe you start taking an additional half point off gdp. maybe it does get worse from here >> it would need to remain shut down for quite some time goldman pointed out there was a two-week shut down with little impact on gdp. >> that's correct. it would have to remain down if it were to continue. those are the sorts of things that when you start to add them up, you start to have weakness the tariffs have essentially been a small number when it comes to gdp, but a big effect when it comes to confidence. >> that was a message of the stock market when economists were saying no, the actual dollar amount of the impact is very small when it comes to the greater economy. the trickle effect was much greater. >> as you noted this morning, it starts showing up in the beige book again, it gets to be the x factor what multiple and number do you put on something like the

increased uncertainty among executives from the possibility of a trade war with china? >> yep steve, thank you doo steve liesman. the dow dropping by more than 500 points we're down 517 right now the nasdaq is down almost 200 points or 3% loss in the s&p 500. this is just office session lows down by 60 points or 2.5%. what should an investor make of the back and forth is there more selling ahead? president of the cio of castle arc management, and core po portfolio manager of hodges funds are both with us what's going on? >> close to a low here when you look at the reasons we got here, they're all policy driven policy on trade. policy on federal reserve interest rate. policy on opec oil prices. all of those were people making bad decisions at odd times it's likely that those decisions get turned around and we've now

gotten to the point in the market where we're pricing in a recession. for someone to say there's more significant downside from here, you have to be pretty convicted that a recession is going to show its ugly head by mid year next year, and there just aren't enough economic factors to support that argument. the other side is a lot of these policy decisions are getting turned over. opec production is going off the market we don't think there's a snowball's chance that the federal reserve is going to raise interest rates if you put them in and get break on trade, this market could take off from these levels. maybe not today or next month but at some point in the next two or three >> in the u.s. and china have face to face meetings on january 7th, that could be a big day in terms of some sort of catalyst at the same time, there's a report that the president looks to sign an executive order that would bar u.s. telecom companies from buying zte equipment which

could be another barb at china which would indicate the talks aren't as easy as we think what does an investor fedo when they're not sure if a catalyst around the corner is going to materialize? >> well, we think that it's really too late to start playing defense right here and when we look at a lot of the areas, especially the economically sensitive stocks out there, especially among the small caps, we feel like the market is already priced in a downturn priced in a recession. we're not overly concerned about that either earnings have to come down from here, or interest rates have to go up substantially to justify the 30% pullback that we've seen in a lot of the industrial type stocks, a lot of the technology stocks and many of the financials >> is it too late to play defense? why is it too late to play defense at this point? is it because the typical defensive sectors, staples have

reached what some might consider full valuations? >> i don't think the risk/reward is really there in a lot of the stocks when you look at things like utilities and a lot of the more defensive areas of the market, and i think if you're trying to take money and move it to the sidelines right now, you probably already missed your opportunity given the severity of the pullback that we've seen in the market over the last three months we're not so much worried about a slowdown, because we think there's a lot of that that's priced into the market once the slowdowns occur, usually by then the market has started to rally off the bottom. we don't know if this is the bottom, but we're probably closer to the bottom than the top. >> we're getting closer as you speak. the dow is down nearly 600 points are you concerned about the u.s. consumer after the confidence readings this morning? >> not really. the tech -- you're going to get a lot of money pumped in in the

first quarter just on tax refunds, and when you combine that with where the stocks are trading, you priced in that b r bearish consumer sentiment that's going to flow through the numbers. look at names like amazon, walmart, home depot. those have come in very sharply, and they still have a head of steam in both their earnings outlooks and their progress going forward. >> you'd be a buyer of all three? >> absolutely. >> all right thank you both for joining us. appreciate it very much. >> thank you >> coming up, if you think 2018 has been turbulent, get ready for 2019 a look at what's coming and what it could mean for your portfolio. plus next year could be a record one for ipos. uber, lyft, airbnb, pinterest. and washington, wall street, interest rates all head winds for high-end real

estate one of new york's top realtors joins us with the impacts across weluh dury por ncis back in two air velocity is reading at fifteen fpm. why would you need to learn every detail about a company? firmness... nine. it's how ibm services helps retailers around the world drive growth and save millions. he's very into this. yeah. is that the standard amount? yes. feels good. when your partners are obsessed with business and technology, you can put smart to work.

investorsbracing for more big international themes that is correct impact the markets in 2019 we are joined by wilbur.

>> here is your 2019 geo politics play book >> 2018 has been a a mull chous year first, the china trade war continues. after achieving small improvements in trade terms with south korea, canada and mexico, investors are wondering whether president trump will end up settling for minor adjustments with china by early 2019 or whether he fundamentally wants to shift the balance of future economic power in which case, escalating tensions should be expected. discretion will also have large implications for the possibility of another summit with north korean leader kim jong-un. second, turmoil in the middle east will the leader continue to get support from president trump despite the murder of jamal

khashoggi. and finally, brexit. deal or no deal? with the 29th of march departure date fast approaching will the deal go through parliament or will the uk crash out of the eu with no deal and risks elsewhere in europe are elevated. the french president's approval ratings are below 20% while disputes between brussels and t ita italy's rumble on. we'll get a test of the temperature of populism with may's european parliamentary elections. guys, as we ran out 2019 investors will be hoping for better return in 2019. i wonder about the chinese economy. can we get any evidence about whether it is slowing a lot going into next year >> well, i think the biggest

indicator of whether trade impacted it is the currency. that's down 5.6% year to date against the u.s. dollar. it's the biggest single yearly decline for the currency in a decade, and we know that, of course, it would decline into the chinese government wasn't managing that decline. it's stemmed the move though it would be bigger if not for that. goldman sachs' forecast 6.6 growth this year they say that was front end loaded above 7% in the first half of the year slightly below 6% in the second half trade tensions with the u.s., the biggest factor that's led to that particular slowdown they say there will be a 0.25% gdp impact because of the trade tensions next year on growth if they stay as they are, it would increase if tariffs are hiked. they say next year gdp growth should be above 6 %. around 6.2% because they turned on that kind of liquidity stimyou loose. >> i'm surprised it's that high. thank you.

2018 market's may give chop y markets a burn the dow is down 600 points apparently this is feeding into it i was surprised to say pinterest listing to go public a couple weeks ago. they think time is of the essence because of the selloff in. >> right we spoke to the global chairman of investment banking at jpmorgan you would think that potentially all the craziness in the markets would potentially delay people from ipoing. they're watching it day today, but the take away is they're accelerating plans to go public. if you want to go public in 2019, then the idea is it's bet tore go in the first half of 2019 rather than the back half as we get closer to the end of the economic cycle, you can see the markets get less accommodating. >> is there pressure to liquidate and be able to pull the cash from what has been a very ill liquid investment

fidelity might see pressure. >> uber, lyft, if you're them, you want to basically give your investors, give your employees an exit at a decent valuation. is that going to happen at the tail end of this business cycle or the beginning of an all new cycle when valuations would probably be lower? >> they're concerned all the sudden there won't be any way to go public if the markets get so bad? they'll be stuck as these private companies try to get into the public markets and the pricing isn't there. >> that's the danger you have a window to go public that window is getting tighter and tighter. >> in terms of when they go public in order to appeal more to investors who may be less willing to take on risk, do they change how many shares, for instance, they sell, or the corporate structure in terms of class a and class b shares >> i'm no expert on this i don't think you want two classes of shares. i think that's something that's -- >> investors don't

>> companies want it >> companies perhaps i don't know if investors do i think they're not going to be listing more than 10 or 20% of the entire float it's a part of the company you have valuations that are 120 billion in the case of uber. >> you pair that with what's happened at snap chat. shares below $5, concerns about the ceo and a structure that's not shareholder friendly at all. >> sure. here you don't know who the winners and losers are until distance if you can invest in the ipo of google or netflix, you would have done that right? you don't know who the winner is going to be until later. >> all right thank you. a usefcoming up, there's be mix for the fang stocks. amazon and netflix ahead apple, google and facebook in the red. what can we expect as we head into the new year? that's next. and as we take a break, look at the s&p 500 sector all in the red

even safe haven of utilities downby 1.4%. nasdaq down by 2.75% down by 2200 stay tuned

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welcome back there were two faces to the fang trade this year. amazon and netflix surged but facebook and apple tumbled alphabet struggled to go anywhere which name is your best bet heading into 2019? let's bring in todd gordon and aaron gibbs. we want you to pick one name todd, which one is your pick >> i'm in apple. i like the pullback here in apple on the weekly. in moving aring average. this is the 200-week it is being respected. the orange lines, a little technical analysis, that's a 50% halfback retracement about 145 is an attractive level. i am hedged. i have concerns about the downside in the overall market, but i like apple into 145. with f we break it, i'll probably cut >> erin, would you cut an snl. >> no, netflix

these are strong companies with good growth. but one netflix istrading abou 60% below its wall street consensus target price that has the highest potential depreciation the second is it doesn't have the regulatory overhangs they're not being dragged in front of a congressional hearing. and their growth is exceptional. they're able to grow earnings not only from increased subscriber growth, but they're able to raise prices it's kind of unique in this environment. overall netflix one of the stocks we have, and one of our favorites within the fangs >> all right two picks from a couple pros thank you both todd and erin head to the website or follow them on twitter at trading nation coming up, one of new york's top high end realtors joins us with the head winds facing his industry in 2019 and let's look at the dow which is now down. there you have it. down 575 points.

apple, microsoft, utx among th biggest users. power lunch back in two. and now the latest from trading nation and a word from our sponsor. >> a double bottom is a chart pattern that suggests the down trend may be ending and ready to reverse. sometimes called a w formation because it looks like a w. a double bottom occurs when prices form two distinct lows on a chart at around the same level. traders often view a bakre of the highest high in the formation has a bullish signal

here's your news update at this hour. two photos have been released of an eight-year-old boy who died in u.s. custody at a new mexico hospital on christmas eve. guatemalan officials identified the boy. he had been in the custody of u.s. customs with his father since december 18th. turkeyish military deployment to the country's border with syria continuing today. a military truck carrying a tank and a convoy of vehicles a crudely made bomb injuring the caretaker of a church and a

police officer militant far left and anarchist groups have carried out attacks over the christmas holiday over recent years back home, a strong line of storms through texas bringing heavy rain and high winds to houston. a flood advisory is in effect for much of the region thousands of people are without power. no reports of any injuries that's the news update at this hour back to you. >> all right morgan, thank you. morgan brennan let's check the markets. we've been bouncing around near session lows for the past half hour or so the dow is down by 553 points. right now we have been lower by 611 points 2406 is a level down 2 .4 %. the nasdaq composite is down almost 3%. retail stocks low after a rally yesterday. it has been a rough day for the banks. regions financial wells fargo

and citi group are the worst one of the etp, ibb down and on pace for the worst quarter since june of 2002 >> wow thank you. the oil market is also closing for the day. leslie picker has more >> a familiar sight these days for oil prices in the red falling yet again after yesterday's massive jump yesterday. the biggest gain in two years. you can see here wti down about 3.1% 4477 down almost 4 %. oil prices have been declining in tandem with stock markets which have been feeling pressure today. focus concerns about global growth when trading is thin like you see on this week of christmas, it doesn't really take a major headline to move the price of oil. >> all right leslie, thank you.

>> with rising interest rates, the high end housing market could be headed for a volatile here we have a new york realtor who closed $290 million in sales this year. he says 2019 could be challenging for big properties with big price tags. with us now is a realtor with douglas elleman. good to have you >> thank you >> i didn't think at this point rich people got shaken out >> i don't think it's a matter of getten shaken out they pay attention and want a fair value they're looking at what's going on in the market, and just like anyone else, and if it's something that's a good property and a good price, they're going to go forward. if it's this aspirational pricing, it's wait and see >> where's the market in terms of coming down from aspirational pricing to something more realistic? >> somewhere in the middle >> we haven't seen everything come down? >> i think the prices have been resetting. the market in general is -- a lot of people are holding onto their original pricing

you're seeing deals done it's a matter of value it's hard to say where the value is we're probably back to 2013 pricing in a lot of ways it's doing the best in new york city >> for years we were talking about the influence of international buyers are they out of this market? >> they're not out totally, but they're less than they were to begin. some of the nationalities have changed. a lot of the high end sales are domestic they're have countries, if they're international, they're from countries you wouldn't have necessarily thought they would be >> such as >> we've seen some of the biggest deals from european buyers this year some of the national deals we've had chinese buyers but less than other countries. there's been a lot of middle eastern buyers anything above 25 million has been stronger than the 5 to 18 or 20 million segment. >> where do you look to determine where you think prices are going to go? when you see the stock market and it down, do you think prices have more to go down

>> i think in many ways prices have reset it's a question of sellers coming in to be -- in sync with that the deals we've been seeing, again, are at big discounts to the current inventory or what pricing was last year. it's a question of sellers getting realistic and buyers feeling comfortable they're getting a good value buyers will pull the trigger they have to feel like they're getting a good deal. >> why is there softness in the 5 to 25 million part of the market >> that's the working rich they have plenty of money. in new york city where i frequent, it's a lot of money but not the kind of people who aren't paying attention. it's not the people not immune to the blips when you go above 25, they have four or five homes they're not nervous about little blips. if you buy something 10 or $12 money, you're looking at your investments. >> what is this doing to

development and new projects >> it's not helping them again, we're doing deals it's a question of realistic sellers. that's a resale or a new development. the projects that are moving are the ones are weather the pricing is either reset or where the developer has priced it in accordance with what the product is and fair value. >> do prices come down on new developments or is it all this sort of soft the incentives that are being thrown in so they can keep a floor on the project? >> historically it's been that it's been incentives what we've seen is some -- we've seen some developers reset those are the ones that are moving there's been some that are aletive -- relatively new out of the gate some have been higher prices they reset they move. the ones not moving are when they've been sitting at a certain price. they're not negotiable and they're not changing the price >> do you know what's going on when you get out to new jersey and connecticut and some of the

wealthier suburbs? especially with the change in the tax law, is there softness >> there is. the changes in the tax plan have take an toll more so outside the city than inside the city. again, the buyers in the city aren't that exposed to that in a way that buyers in the suburbs that are looking at spending 800 to 2 million those buyers, that has an effect on their taxes >> at some point the softness in the burros impact pricing in manhatt manhattan. the working rich can get a mansion for $3 million in new jersey versus -- >> people would rather live in manhattan. that could happen, but i don't see that happening we've not seen anything leading to that. people still will pay a premium to live in the city. right now they're getting a better deal than they've been able to get for the past six or seven years. a lot of people are choosing to stay and pull the trigger. >> and rent quickly?

>> rents usually go in first with the property prices but we've been seeing the softness all around the prices are soft if you're looking to buy or rent, it's been a good market. >> that's not a sign we're heading into a patch of real weakness . >> i don't think so. i think you're seeing a lot of investors that bought the high-end condos as investors thinking they'd get sky high prices now there's a lot of inventory i think that's the problem with the sale and rental market just as with sales, there's deals to be done on the rental be realistic just because you paid x doesn't mean you'll rent it for y. >> the working rich. i'm still working my head around that it was a big year in sports gambling a look at how much revenue has been generated so far and how much bigger it could get in 2019 plus kicker nick lowry took a gamble on three stocks in our stock draft, and it's paid off big time he joins us with a look at the names catapulting him into first

place. the dow is off 533 points. s&p down 60. nasdaq down 190. we're back in two. [beep] you should be mad your neighbor always wants to hang out. and you should be mad your smart fridge is unnecessarily complicated. but you're not mad, because you have e*trade which isn't complicated. their tools make trading quicker and simpler. so you can take on the markets with confidence. don't get mad. get e*trade and start trading today.

welcome back 2018 was a big year for sports

gamb gambling it's bound to get bigger next year eric has more. >> a banner year for sports gambling as the supreme court struck down a federal now. now every state has the ability to legalize sports gambling within its borders expect more states to come in 2018 more at least 20 states working toward legalizations revenues small in new jersey the industry has taken in almost a billion dollars of wagers in november. only $8 million in taxes we checked in with our friends at the action network to find out which teams were the most popular bets this year not surprisingly the most popular picks were the obvious favorites like alabama football, the patriots, the warriors, champions. the most profitable nfl team against the spread has been the 13-2 new orleans saints earning you a 51% roi.

the least profitable team against the spread, the falcons. in 2019 expect the business trends to continue more states are going to legalization partnerships will continue to grow and gambling tax revenues will add to the coffers of cash strapped states? >> i got a problem saying a 50% roi. this is not an investment. this is pure -- >> there are gambling hedge funds out there. think about hedge funds that do options only if you're just doing gambling on a portfolio basis -- >> but you don't own anything. >> there's no cash flows >> a two on one attack on this if you do it right, it can be an investment >> i don't think so. >> most people are doing it wrong. >> and you're right regardless, if you make the wrong bet, whether it's on the market or the sports teams this year, you're getting creamed >> i'm going to leave it there

>> thank you, erik we're just about a month to go until we crown or 2018 stock draft champion and leading the way in first place right now is former nfl star kicker nick lowry. he is the only one in positive territory. tim seemore. nick, you must be feeling pretty good >> i am. in fact, even though the tech stocks all the way down, facebook, and apple, et cetera, they're all down, i believe that amd, our super star, sort of like tarik hill for the chiefs, i think the microprocessors, the implementation of ai are going to be 50% per year up side so it may be tough for the overall market i think we're in a great position >> goldman sachs has been a

tough pick theoretically when you picked it, it seemed like things should be good for the banks in 2018. the fundamentals didn't change the banks didn't respond if you had your druthers, would it cut it loose or do you believe in goldman >> i believe in goldman. i think you're going to see some up side over the next month because liquidity is still there. the interest rates are up. and when we have a downturn in the market, you turn to the gold standard which is goldman sachs. >> when you're looking for 2019, who is your patrick ma holmes? >> well, i'm absolutely amd. i still feel positive about them and then amazon still no market cap that you can define. again, part of the tech downturn i think you see a 40% upturn in amazon over the next year or two as well. they are, as i said a few months ago, able to cannibalize and

redefine the service ai is a part of that they have to manage hundreds and hundreds of realtime assets. i wouldn't really change anything at this point and as you can see, with all due respect to mr. wonderful who is down 29% or bethany down 27 or my incredible friend erik dickerson with the rams who is down 25%, i think we're in good position >> we're showing these guys, your good friends, as well as mr. wonderful and what their portfolios are erik dickerson had a directional concentrated bet on oil. and as for mr. wonderful, kevin o'leary is in sixth place. did you really go into this really just wanting to beat kevin? >> you know, i love the process with my friend tobin smith

formerly have fox. they look at crypt currency. that can affect your profits 12% per quarter. i believe each of them is more sophisticated or at least better than average in terms of risk management with the volatility of the markets so i've enjoyed that, and, of course, a side part is watching mr. wonderful who is sitting right in front of me not do quite so well this year. >> it's not over yet, nick but by the way -- >> it's not over >> do you bet on sports? >> no. in fact, i really don't like that at all. i saw where a running back for the rams stopped just sort of the end zone which was a great mark in shortsmanship. won the game and the markets were talking about the bad beats in espn, it was about money. i was walking down the stairs after we won the game easily and somebody said you blew the over and under. there are a lot of people that

bet lots of money that don't care about the players or the game and i'm really -- >> is it hurting the game? >> i'm concerned about -- i think it can hurt the game and i think you have to protect the players from that being in their face all the time. it can't do anything but compromise the integrity of the game be very careful on this. it's going to happen, but be much more careful. the players need to focus on playing the game there's enough pressure on them as it is >> well said thank you for checking in with us >> i want to say happy birthday to my friend, dean >> happy birthday, dean. thanks, nick coming up, what a difference a day makes. now with an just over an hour to go to the close, could we see another turn around in we're off the lows dow is down 450. we'll get the take with a trader right after this

now on pace for the worst quarter since march of 2009. among the groups leading is hawaii airlines united jet blue and american airlines. back over to you >> lots of red there thank you. just over an hour left to go let's get a trader's take. we have managing director and cnbc contribu tributer. >> you said we are not there are we any closer today? >> well, listen, you know, you read and you think that we have kind of got a handle on it we went up a thousand points as we look at the closing and balances it's pretty evenly split. i don't see people leaning into

the close. the other fact you have to contend with is that this is a holiday week a lot of people are not manning their desks. you see some of these moves are exaggerated because of lack of liquidity. >> and the lack of liquidity we spoke about. it the hard to tell whether to blame that for the deep selloff. at some point stocks look attractive here. you gate januaet a january effe. there's nothing you can really point to to take us higher >> no. i think there's more questions than there are answers one of the things that concerns us a little bit today is some of the consumer sentiment you can look at gdp and china and look at some of those numbers. it isn't what drives the economy. it is the global economy it's the american consumer right now if that confidence

starts to wane it's another reason to be concerned as we head into the new year that we are not going to be able to grow this market. i think right now as i talk to some of the folks that are maybe off the desk at the moment they are putting the stop arorders dw below. they noticing gold they are sort of taking a very defensive posture right now. i think right now the mood here is some what cautious but also a little bit leery we'll have to see what january brings >> we were talking with steve about sort of the multiplier when it comes to things that really hit sentiment when they are quantified they seem relatively small in relationship to the economy and to economic growth they really took hold of businesses and really shaken businesses these are thingins that you cant plug into a model.

they are sort of the unknowns. unless we have some sort of breakthrough come january 7th, you know, i'm not sure how the market interprets that at some point it has got to come into play. >> certainly they are another form of consumption tax. it ends up track liickling downh end user we are not only looking at the trade data but you have to look at the budget data sit a lot between the domestic and international economy, global economy and so i think investors are saying what is going to be the stabilizing force that will allow this market to continue to grow

>> you want to clear the entire wall of worry. so the final question sheer are you watching any levels in particular whether we are out of this thing >> i think at this point we want to see an orderly close. what i'm looking for right now is to not see any major cell programs come into play here where we start to then see, you know, this drift back to what we had before the gains yesterday i think what we can hold at these levels they tried to rally them a little bit. if we can hold them here and through the rest of the week i think we'll be setting up for an interesting day on monday. of course january comes into play turn the calendar it's a whole new ball game. >> good to see you again >> thank you we have check please next.

lest look at the dow the dow is pairing losses by about 250 points we are down by 353 going into the close. stay tuned

welcome back it's time for check please they said there's only two other four-day stretches >> yes >> the s&p advanced decline was

either above 400 or below meaning there are more than 400 names. the last two teeimes we have se things that extreme is november 2008 we had the debt downgrade, a budge of things going on >> right >> didn't go into a recession. >> think about the market moves in 2011. from the end of april to the beginning of october at the beginning of october we had three days of gains of more than 1.5%. it doesn't seem like much but those three days marked sort of the bottom there i think they a hoping it's not something entirely different than we are witnessing here. >> i wonder if it is little bit of post-traumatic stress

syndrome the concern is we are rerunning it to me you never run the same movie swies. >> yes >> thank you for watching power lunch. >> closing bell starts right now. >> thank you both very much. good afternoon welcome to the closing bell. >> this is the final hour of trade where literally anything can happen it has been the case let's get straight to the markets. we need a rebound in the last few moments or so. still a triple digit decline after yesterday's historic rally. the major averages back on pace since the worst of november 2008 it was minus 500 it is now down minus