wrecking ball. it is an unbreakable rally we had to play it again as we go into the weekend consumer discretionary up 1.7% thank you for watching power lunch. closing bell starts right now. it is time for the closing bell we have one hour left and what has been a crazy week for markets coming up we have the god father of technical analysis two new board members and what the move means for the future. we'll keep you posted on all of the late breaking developments

>> and facebook under new scrutiny today as the new york times revealed the company to police content we'll take a closer look at how decisions are made and how this new headache could impact investors. the closing bell starts right now. >> welcome to the closing bell get to all of that in just a second let's get straight to the markets. it has been volatile again not what we have seen there recent days. the dow is down 155. it is now trading up 220 points. we have got 59 minutes to go >> we do the high ton the dow is 240. major averages still on pace for the first positive week of

december it is back up to a level that we were really worried i9 was going to crash below it was the previous low in october. you also see it was right about where the market made the lows in february and also in march and april. at the time we thought it would be the bottom end of the range we are saying we are maybe 3% from a level where you can decide if it is a bit more than just a bounce. it could mean we have a little bit of clearance to say we can kind of recover more

>> it would be some of those in the months before that rather than getting back above that we were there 25, 30, 32 was the low from earlier this year you're kind of on the way down. >> you can continue to chew it up and get back to some kind of equal lib yum.

>> it was what we had seen before >> very quickly, had any headlines moved us at all this week >> not really. in general i think the quiet has helped whether it be nothing adverse or anything like that. but no i don't think for the most part it has been news driven. it is a mark that got sold out in the short term. now you have low evaluations yields are behaving. why not rebuild? >> and we are up 4% at the moment is that encouraging? >> it is an offensive move

>> tweeting and calling this a vacuum rally he joins us on the phone to explain. we are happy to have you here. what's a vacuum rally? what does that mean? >> i think he stole my story he's absolutely right. he got very over sold it was 21,172 and on the way down it was a free for all it is like taking a rubber band and letting one end go it's nothing between here and the october low and early december low on the dow.

it's around 24,400 to around the 25,000 level i think the rally continues here that's the good news the bad news is that when we get up there they will run into a little overhead supply i think it's a little premature. >> the point in terms of whether we hit a fresh all time high again, is that needed in the next few months for this long bull market to continue or can we traverse for the start or rest of next year? >> well by definition you need new highs. i dare say that because of the damage that's been done so far this year we are more likely be in the trading range the best thing is that it would

be back around 21,000, 22,000. we could do that successfully then i think we could see that >> it depends on how we look at it i would say you have a bare market right now >> update us on the painting on the side of your barn. >> it is giving you some more

room >>. >> there's nothing more important than completing that bond painting. there we go. >> i'm glad that the market could. >> thank you for joining us. we appreciate it >> okay. thank you. happy new year >> and to you as well. let's move it onto the closing bell exchange. >> good afternoon to you all jonathan, start with you is it nice to have a relatively calm day at least? >> it is something that has been well warranted it came out and immediately it

shot up. now we are pulling back in it is good to see the lack of major involvolatility in reality the lack of participation would magnify the moves any day. >> this week has been way higher >> not today >> not today it is in the opening and closing options. that is where we are seeing a lot of liquidity the volume has been slowly picking up >> how much should we put in the action that we have seen in the market this week as far as knowing what to do next. >> i don't think we could pay muchattention.

i think what we'll see is a struggling market but one that moves higher it is economic growth in the u.s. and economic growth globally and a solid earnings even though they will be at a low a lower rate than we are seeing in 2018. >> what are the key levels you're watching into next year what do you expect us to be 12 months on? >> for the rest of the year and for maybe the next month or so i think monitoring the 96 level it is a good thing to monitor actually for the future you might be a little cautious the reason is we have seen a steepening of the yield curves

i'm not stressing this because they have gotten super steep steepening curves highlight something in my opinion and that is less fed. the market is thinking less fed. less fed is not necessarily a positive dynamic for the dollar index. it's a good thing to monitor as far as the yield curve nothing sums it up better than looking at a two year note yield. it is down four on the day and down a dozen basis points on the week a 30 year bond is down three on the date and unchanged on the week i think it drives the point home about how it has been steepening in a dropping rate environment >> we are seeing confirmation of what we are seeing in the equit market are we seeing a safe haven flight as we might expect? is that behaving normally? >> in a cumulative fashion the

answer is question what we are trading now is over 50 basis point that's a fairy good correction from some of the november highs. as it was progressing in realtime especially in october i thought the bond market was dealing with it rather well. all things being considered we still have deficits and biggi bibig big issuance none of that or those issues are going away i think part of theish hue is global slowing which makes sense. i think the biggest reason interest rates moved down was probably the log jam of how so many large institutions, entities, funds were short looking for a much higher final quarter than we ended up with. >> would reopening the

government be worth a couple of percentage points or are we focused on the big 2019 issues >> i don't know if it will move that market tremendously we are also seeing gold up treasuries up. it is pushing yields down. it is kind of rallying right now. oil is higher. it has been a key. >> we have been watching gold. as rick said before that correlation isn't directly right there. i don't think people will know where that is going to be in this type of market that we have seen >> we are slipping as jonathan was pointing out we are only up 78 points kate, your view for next year, you prefer international equities >> yes we think they are better valued.

right now everyone is incredibly pessimistic. it suggests there could be upside as european countries are beginning to spend a bit more and breaking the budget. it should be positive. japan may come out of what looks like a current slow down all of those suggest that the possibility that the rest of the world's growth is stronger says you have more upside as well as the fact that rick just pointed out that if the fed doesn't increase rates as much as people are sort of thinking right now you could actually see a weaker dollar and that's also good news for international investments. prospects there are than expectations today >> just a quick final word is it important that we close in positive territory today

>> i think the market isn't convinced which way it is going to go. any pull back here would be okay i think more to the upside is damaging >> we have to get here yesterday we called a positive close. >> he did say tremendous gains in the final two trading sessions it doesn't look like we'll get that today kudos to all of you. we appreciate it happy new year >> world's worst performing stock market this year >> probably kind that. >> yeah. down 25% >> i didn't know if you were going to give me some nonmajor one. we should find out we'll bring that to you after the break. is this week's volatility here to stay? a strategist lays out why it is like driving a car with three bad tires. up next tesla adding two new directors to its board

he will tell us whether he thinks it is a good idea next. as we head to break look at how this final hour of trading has been this week triple digit swings of at least 200 points ino days we got more than 400 pots we'll be right back. i'm ken jacobus and i switched to the spark cash card from capital one. i earn unlimited 2% cash back on everything i buy. and last year, i earned $36,000 in cash back. which i used to offer health insurance to my employees. what's in your wallet?

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larry and walgreens executive is here. here is larry talking back in october. >> my second largest investment, i will disclose it now i'm very close friends and i'm a big investor with tesla. >> let's bring in cnbc is this a good idea? >> where you stand on this depends where you sit. if you sit in his seat it is a

fantastic decision it is such a good decision mark zuckerberg must be tossing and turning. no you're picking a clone of musk he is brilliant. he is a genius he is very articulate. he is a pretty angry guy he loves to lash out very defensive and so for this guy to bring the adult super vision you could have done better you have a calmer personality. >> along with the fact that robin was made chair as well a couple of months ago do you think the sec will be satisfied?

>> i think the sec has been had on this one. he has renamed him the short sellers enhancement committee is that this is no a move that should please the sec. they didn't see it coming. he has out maneuvered something it could protect him it is in the a guy that would push for vetting and you mentioned that he says he can control her. he very openly says so on that 60 minutes interview earlier this month which is extraordinary. it shows a continued disdain for the sec.

we are still no where near the sale price he said he had secured. >> the dow just turned negative. we are down 6 points >> look what you did >> i warned you this would happen didn't i tell you don't ask me i'm so sorry >> i get your point about tendency to be brash but is there anything that would question his governance? it seems some how to work. he holds a position of chief technology officer so he is still employed there as the chairman you don't know who is truly calling the shots

neither of the two people he put in as ceos and many of us were skeptical. i am surprised they made it work so well, but he was always very flamboyant he was attacking and he hated microsoft. these days he is taking on jeff, perhaps not as horrible as say the long wanguage musk uses that helped out in the tight rescue of the soccer team he is still given and he has never been able to control him i worry about that i think she seems very capable, a great choice in many ways. certainly knows and she is trained as a lawyer coming in

and it's a great global consumer awareness. i don't see how she has the time to do this it is a lot to juggle for a current executive. most limit that to one board outside your job i don't know how she would be able to keep up with it. i worry about her having the time to give it proper oversight. it is the temperament with highly accomplished. you would say who are we there is a book written about him. it is titledthe difference. >> sit about how corporate america is interacting with this

current white house. what are you finding >> they have gone through a lot of stages. they are very skeptical coming in mid-size and small business and big business was universally cautious once he took over they were very enthusiastic then you started these of ford it is unparalleled assault on allies it is trying to do that and on top of that it is a sense of embarrassment. three quarters tell us they feel they have to apologize for president trump and all of the international dealings that's really troubling. you ask them what's the greatest

threat to the market is it all of the things they have been talking about? they say it is political instability. it is a 64% turnover we have never had anything like that and 25 positions wide open. >> no. interesting. we'll leave it there always good to hear from you >> thank you all right. we have 34 minutes to go here. the dow has turned negative. rally losing steam here in the final half hour or so of trade s&p is flat. nasdaq is up about a fourth, a little less than half a percent. >> the spread is down 155. it is down by 50 at the moment up next financials are down 15% on the year. it is a good time to jump in we'll take a look at the biggest banks after the break.

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>> the dow is down it had been up to 40 the low of the session for the dow is down 155. the s&p negative slightly. time now for cnbc news update. >> hi. here is what's happening roadside bomb struck killing two

tourists and wounding 12 more. it was the first attack to target foreign tourists in nearly two years active duty members are in danger of receiving late paychecks because of the partial government shutdown. thousands could be furloughed. the coast guard is the only military branch in dangerov of o getting paid >> it is a thing to save lives and protect the environment. there is always mutual assistance there is a relief society that can help members >> there are reports that kol lard greens are in short supply. they wiped out the collard green crop for many it means prosperity if eaten on new year's day. that is a tough story. back to you. >> all right thank you. see you next hour. half hour to go in today's

session. let's look at some of the biggest movers let's start with you >> this is quite an amazing day. it is kind of flattish there's not a lot there. look at that consumer names will tend to flock together but look. today you have merck they are down. there is no pattern here industrial names even more so. they tend to flock and move together not today. boeing is up united technology isn't. caterpillar is not 3m is up it looks like the last friday in december like a normal last friday in december kind of random look who is back, dell technologies he took him private along with

silver lake. they are trading here. here is what's interesting about this it was not an ipo. esz enherbally they went and took over a ticker that tracked dell's interest. it is not really an ipo. they are back. it's up slightly 4460 is the one issued at any rate michael dell, welcome back back to you. >> you sold that excitement. i like it. >> i thought he was -- >> it was great. >> let's send it up to jackie. >> hey i will echo his sentiment and say it's a little more of a quiet day. it is quiet compared to what i'm sitting here and trying to keep track of whether the nasdaq is in positive or negative

territory. we lost it t. movers we have watching here is having the greatest impact. amazon was a big mover today apple, intell, y faang is all green, straight down the line. facebook is turning into negative territory can't keep up withthis stuff tesla is having a nice move on the day. last time i checked it was about 5% chips are doing pretty well too. back over to you >> all right thank you. what is all of the recent market volatility tell us about invesing we have two gentlemen here to

debate it. so are you taking this opportunity to buy >> i have to tell you it is not fun for you. it is fun for us i have been in the business for 35 years i have never seen volatility like this. >> never in 35 years financial crisis, 90s? >> it was down in 2008 there was a pattern. here is there is no pattern. i feel like it's driving in a car with three bad tires and one good tire and you're going all over the place hoping you get to the right place. >> what are you doing? >> i think i heard you talking about trying to find a pattern today. i think-a little bit of a pattern over the last week or

so we are looking for bargains here it is down 30 to 50% >> like the energy >> energy is down the most it looks like 2015 it is concerns over a recession. you could make a lot of money if that happens will they be wishing they bought come the end of 2019 >> i think so, yes i think when you get a chance to buy stocks when they down 20% you do that. stocks just went on sale 20% that isn't to say there won't be more volatility. if you felt like you could guarantee one thing volatility would be the hinge you could bet on probably most so we have policy risk out there from the federal reserve

we have trade risks and all of these risks. i think what we have seen fundamentally over the past couple of months is repricing of growth expectations. we are going back to a two, 2.5% here i don't think that gdp growth is bad. i think if you aren't thinking you're going to go into recession you can buy some of the companies down 30% i'm putting up my top ten list this afternoon for 2019. >> give us a taste what is the top of the list? >> so disney, fed ex, cvs, chevron, i have jp morgan and goldman sachs, i mean these are companies with solid balance sheets maybe it will be somewhere

between 5 and 7% next year i don't think that's awful if you told me i could have my 7% i could kiss the ground right now and sign off >> you gave us 7 out of 10 right now. it is much more than a taste >> i hope people will subscribe on the web site. that was a tease >> i know but you revealed too much >> i apologize >> talk about what you'll be hunting for. >> i start with two bargains it is down about 50% for the year this is the second largest in the world. it is strong in the united states earnings should be just fine it is enough to justify a price higher stock number two is down 50% is warehouser it is a company which sounds boring >> sounds like it is tied to housing. >> to some extent it is tied to housing. >> it has been a little bit

suspect. the other side is the stuff is used for packages. packaging is a growth business think about it here is the stock down 50% with a dividend that is down 6% >> happy new year. >> they will be here on monday >> you won't be hearing from me for about a week it has been a year for many pot stocks and 2019 could see more big aldes. which names should be on your radar. we are back in a couple of minutes.

we have the name to watch and some names have fallen almost double that amount. >> yes we clearly have been debating for most of the last few months the fact that are we beginning to have a recession? if not some of these could look attractive i think it really sums up that

sentiment. we just showed the index down 20%. s&p down 7%. here are some of the evaluations. the average pe is 8.6 times. the average is 14 times for next year's earnings. so we can look at some of the individual names there is quite a bit divergence here it is right down to goldman sachs. if we don't see that in a recession this year or next year and the earnings estimates are roughly speaking right this looks incredibly but earnings

could disappoint. this time last year people were saying we are going into a year where we are going to get a proper tax cut the economy is going to grow the most it has grown in this entire recovery which we have seen 3% plus growth. all of this should be great for the banks. >> it was. traditionally banks trade always at a discount. d they are trading it is -- >> it is not performance i guess. >> right >> we have 17 minutes left of trade. we are in negative territory for the dow down 90 points the s&p also just negative

the nasdaq holds onto positive territory. up next the top technician will explain w nhyow could be a great buying opportunity for energy stocks. that's great. but right now you've got your hands full with your global supply chain. okay, france wants 50,000 front fenders by friday. that's why you work with watson. i analyzed thousands of contracts and detected a discrepancy. it works with procurement systems you already use to help speed up distribution without slowing down your team. frank, tell fred full force on those french fenders. fine. fine. fantastic. for ai that knows your industry, choose watson. hello! the best ai for the job.

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down more than 20% mark joins us with his take on whether energy can bounce back in 2019. mark, good afternoon to you. what's the first chart you have got for us >> we are looking at the xle when you look at monthly charts a couple of things suggesting that coal might not have been a bad thing >> sit hugely important going into a new year. we have been talk about this volatility it is the worst performing

sector to bottom out we are heading into a bullish time for energy. it is worth considering that energy might be something that starts to show a decent bounce and even if stocks pull back it already suffered a tremendous amount being done under 25%. this is xle versus the s&p on a relative basis you see the fact that we have gotten down to a very important level on an absolute and relative basis it has sold off enough that it might be enough to be selective in buying. >> sorry here you go. >> i was going do say it feels like energy and the market are highly correlated. look at crude oil. how much more correlated are they now >> we have seen tremendous correlation. both of them have started to stabilize. we have seen decent counter trend in crude and in the s&p.

my thinking is it should start to rally and historically it has been february to may s&p still needs to clear to be out of the woods i like energy in terms of being something that's so bad it's good and really taking a look at putting some money to work >> okay. thanks for joining us. >> thank you with 11 minutes left to go before the close this has been another volatile hour of trade. we started up more than 200 points we have swung 300 points lower this is heading south down 127 >> nasdaq joins s&p in negative territory. >> up a third of a percent up next marijuana mania, why we could see more con ssolidatin we are back after this [leaf blower]

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welcome back talk of cannabis con sal dalgs is heating up. we have more

>> looks like this is one example of the trend where are they looking for value? in this case they were trading around ten canadian dollars after a short seller report. it paired some of the losses it is trading far below the highs earlier this year. aphiria believes it under values the company. it would be among the cross border deals analysts expect more could come next year. let's take a look at some of the u.s. companies which could look to partner with cannabis companies down to road we may see not just industry merges but cross industries as well the bottom line even though marijuana is farly illegal cannabis companies don't want to miss out on the canadian opportunity. >> green growth is mainly focused on retail.

what's the kind of value proposition coming through this deal >> sure. the ceo came from brands like victoria secret where he was an executive. for them it's about the fact that aphri -- ins it is illegal here in the u.s. they can't bring any of that over but they can share intellectual property. >> okay. thank you very much. up next we'll be back with the closing count down with just over five minutes left of trade. >> we will wrap up the markets, what it could signal and what it could bring for next the closing bell is back with a level of protection in down markets. so you can be less concerned about your retirement savings. talk with your advisor about shield℠ annuities from brighthouse financial,

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don't get mad. get e*trade, dawg. we are down 100 on the dow while the scale of the moves is on the move. the decision has not gone away there is the dow green and red and we'll end on some red

slets let's have a look. they are down on the week. the volatility increased jim cramer has been talking about it everyone focused on the fact that oil and equities have been linked dollar up a little bit today it is down on the week volatility there been there for the week but not so much in today's session. going to end on the week as a whole. we are up nicely about 4%. it is encouraging. >> yeah. you made a good point. it is not clear if we are in an up market or down market >> thank you >> i think today was encouraging because today was a nothing market essentially it is one of those last fridays in december. the real one you can't really

determine what's going on based on today's trading i thought it was encouraging the last two days. it will change things. i don't mean fourth quarter earnings if you're in the zero or negative the market will probably will still be down. if you think there's a mid-single digit earnings growth the market is under priced >> what happens the first two weeks of january do we calm down until then or is it more of this past week? >> hopefully we'll hear more about china negotiations

we will get a couple more earnings reports, but it will start two weeks after. >> the nasdaq has closed positive the dow is still up by about 40 points the s&p just ticking into positive territory back to you sara >> welcome everyone. happy friday i'm sara we have mike here. sheer how we are finishing a wild week on wall street with the close actually modest price action here.

nasdaq did pop into positive territory. couldn't quite hold it just a little more dow closing down 77 points just to tally it all up first positive week for stocks of december but a reminder, it is still a worst for the dow since 1931 it is the worst overall month since february, 2009 for the nasdaq it is the first month since november 2008. it has been a crazy week let's get a look back at this week's big swings. a look at what we can expect heading into the new year. bob is here. jackie is tracking that. let's start with you

there was a little bit of a trend. it is always encouraging those are global names 3m all generally did pretty well united technology was is one down fractionally. they say it's the end of the game that matters. one sector that did very well mastercard noting sales up 5%. kohl's, foot locker, best buy, d gap was up 6%. finally the elements of the rally, the conditions, the short covering and the pension fund

reallocation >> thank you very much for that. what has gone on at the nasdaq today, jackie is taking a look for us >> nasdaq breathed this one last breath it managed to close positive on this friday. less than one tenth of a percent. it is back and fourth between positive and negative. here is what we are looking at for the week still about a 4% increase for the nasdaq composite until last month about a 10% decline even with the gains that the index managed to recoop during the week. amazon was a big mover today to the upside it was a late turn that we saw that gave the index a little problem. you can see they ended upset up settling the session. amazon was the big one.

a company saw a record holiday season he saw streng in the chips facebook up 6% back to you. >> yeah. a little divergence there. apple and amazon both closing higher thank you. joining us now to talk more about the markets nancy is here. chief investment strategist, nice to see you. >> thank you >> first, what did we learn from today which was quieter but also took us in different directions. >> yeah. the fever has broken to some degree at least for the moment you sort of got in the way of this process of just these air pockets being filled can selling. that was two days ago. the market has kind of rebounded from the most extreme of the oversold conditions. year end is here i don't think anyone is making their year

if you think about that you have -- >> santa claus came after all. >> late but eventually he is here >> it doesn't feel like it >> where is this sort of liquidity and volume at the moment today was lacking. is that something we can expect to continue next holiday week as well >> no. i think only monday is the day you have to say that that's the big question. you have relieved this sort of oversold conditions. next year you have new year influx you have peoples perceptions of how much risk they have to work with for the coming year it goes back up. >> it is enough that we can actually buy far longer term

period >> what did you make of all of the extreme moves? did you take any opportunity to buy? >> we bought a little bit. early end of last week we were actually doing for a number of our clients. we picked away at a few names earlier this week. nothing as any great magnitude it is difficult to have a sense of what's going to drive this thing going forward. we have a cushion now. some of the damage has been undone no one is going to be in there buying on friday or even necessarily wednesday until we get a sense of, you know, where things are moving from the china trade talk standpoint. i did think the pmi's were very positive we were a point lower but well ahead of consensus that was actually encouraging to me >> chicago >> chicago pmi, thank you.

>> so i think that's good news i think the consumer is in good shape despite the pull back in confidence i'm actually modestly encouraged i don't know if we have hit the bottom yet >> we have blown out records, most haven't happened since 2008 it has lots of discussions going. you have seen some similarities to a different past year, 1990 >> i do. i mean it's so interesting to me we had two major rallies in 1990 and a big selloff in the third quarter. we ended the year down low to sing it digits, very similar in tenor. we had come off of a strong bull market period from 1984 to 1989. the market was up about 168% we recalibrated and we took off another 450% it's not a perfect analogy but for those of us who have been at

this, you know, longer than the last correction this feels like an economy that can expand if a number of things continue to go right. i think we are hearing some temperance out of the fed which will be good if we get movement on china it will be helpful. earnings deceleration is already priced into the market >> nancy said we are starting to get moderation that the fed will be a little more contained when it comes to hiking rates that's consensus >> the markets decided to believe that >> we have had some on china and u.s. trade >> china allowing u.s. rice imports. also putting out there today that it's looking at public comments far new investor protection law it gets a lot of u.s. criticisms are things heading in the right

direction for this market? >> i think to the extent you could do that, sure. what's more important to me is exactly what news we are going to get on those fronts is when the market comes down 15% the stakes are lower you don't need great news to have the market do okay the way you did when the market was at its highs. no what will propel us higher we have to get immediate peace and we have to have the fed not be ahead wind anymore. risk comes out of stocks >> the top rice producing countries are? >> not the u.s >> china, vietnam, thailand. do you think they will buy rice all the way from america >> we must produce some rice maybe brown rice, polished rice. >> i'm not an expert >> you also had a steep decline

of just shy of 20% it was a minibare market that's what we had at least so far if the lows hold >> want to talk about buy backs other names that got hit on buy backs applied materials. >> why this is how they decide today use their cash >> and i think the point on this is they are not meant to be traders. it is indicative particularly when some suggest should be using dividends instead. it is quite an interesting take on it. >>. >> okay

100 billion in net cash or a bit more nothing smart you can do when you're having tremendous -- you can't make a genius acquisition. you can't invest that much it is an enormous type of money. >> they are really spentd ago lot. >> it's interesting to me because eight months ago it is a rigged game. they bay back their own stock. it automatically sends them higher apparently not >> i have an interesting question on this we talked so much in the past about that.

>> they are saying here is how much cash we need for the business a mature business is passing it back to investors but not because -- >> let's ask you do you think it raises questions and how much companies should be spending on buy backs? >> i think, yes. i am not a big fan of share buy backs. i understand the mechanics i would rather see companies raise their dividends. in the case of apple they have plenty of room to do that. companies like texas instruments are playing back all of their free cash flow through dividends. they have been raising 25% a year apple has been raising dividend about 10% a year if they don't have other compelling places to put the cash it is hard to make an acquisition.

we have all sort of forgotten about beats. it had no impact on the underlying business. i do think that a balance would be good. i felt the article was some what unfair it may have cost them $9 billion in terms of capital depreciation they did say, you know, 3 bucks a share on 6% of the difr devid. i'm not sure that was a true analogy. >> have yields acted as a good defense? >> it's in the apparent that they have. whether it is 1.8% on the dividend yield, no tesla popstoday.

they made robin the chair a couple of months ago a big pop. we heard from him earlier. he was surprised how big it was given that it is seen as a friend, an ally. >> it's not clear to me. i feel like they had to get the two directors as part of the deal they have done so. obviously it is a name it's somebody who kind of it is regardless of the fact that she truly independent. >> you war seller of tesla, correct? >> on the governance issue

>> i actually disagree but i think it is a good sign for the investors who are not of tesla they are saying i want to buy the company but i have an obligation that was our issue for me i would want him on any team i was on. i think yes, she a friend but he is a very smart friend he has built a very compelling fortune and business i saw it as a good sign. there is still a management hole in the company i wasn't really surprised to see the stock move it didn't really move all that much a year ago it would have gone up 50 bucks i felt like it was a step -- a nod to yet we are going to take it a little more seriously i could be wrong >> are you going to buy tesla

again? a lot of negative news flow and has outperformed the market. >> no. it's crazy we were buyers in the 180 range. we sold it over time it is a little rich for us the earnings, we need to see more in terms of earnings at this point given the evaluation. it got close and we lost confidence in musk and his antics and all of the departures we are watching. >> great stuff thanks for joining us. >> i don't think we disagree that much. i also wasn't surprised at the pop in the stock in the scheme of things that's noise going up >> yes >> the short answer is yes >> okay. thank you very much. we'll see you again soon >> okay. >> the dow swing 300 points in the final hour of trade today capping off a one week it is at the end of 2018,

whether you have the chance at a discount coming up the retail wreck, 4:00 p.m. was a deadline for sears to get a bidder is this the end of the line for the company? we will know this hour and we will discuss it after the break. so, the whole world is talking about ai. big, bold promises like...

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is this about the alien invasion >> it is last night people didn't know if they were falling. there was a big light show it was an electrical explosion from a utility company it turns out there weren't significant damages or destruction just one of these electrical implosions. the governor is calling on the public service commission to investigate that electrical failure. it did shut down the airport orr

a while. a lot of impact there. now they are going to investigate it back to you. >> eric, you had funky stories today. >> i know. it is friday >> we have had the other one coming up. all right. sears, we have to talk about that the deadline clock has ticked down to zero he had until 4:00 p.m. today to submit a proposal to buy the company out of bankruptcy. >> have we seen the end? jeff is back with us bring us up to speed what is the late snes. >> -- latest? >> it is to anyone else. his bid, if he did do one will be public. there might be a delay in that becoming public. per my conversations with sources all day he had been working very hard all day to get

that bid done. i still don't in if he lined up all of financing and formally submitted his bid. >> so that would be if he did it is it possible anybody else could make a bid and would they also have to make it public? >> great question. there are a number of other parties that are bidding for other things basically they are liquidators that are bidding to buy it and break it up in pieces and sell it it essentially goes away it is possible there is some sort of dark horse who has been very secretly been lining up is sears salvageable >> i actually grew up.

my father is a mens clothing merchant it's a very very difficult business we took a look at who they were in the mid-to 1950s and two they are today. it is scary and so many others had disappeared. they could have survivored it isn't just because they were old. you could take a look at macy's. it is about 160 years old. they have been able to refurbish themselves the way they have just because they that had a long legacy. there were terrible mistakes they actually shut down the catalog business they had that distribution model

and it was a shame they moved into stores but they should have kept catalogs. they showed us how you can actually not cannibalize by what would work together with retail. unfortunately eddy bought into this they made terrible mistakes. they weren't focused on the merchandising. he did put a lot of resources into online. they lost their way. i believe he may have had more ceos since he was the longest running ceo under his reign since he controlled sears since the founding 132 years ago

>> it is a very complicated thing. we had more when he sold it and combined them. it was his big ill fated move. i think esl, his securities company has about another 15%. you have that ownership on one side p he is also on the other side of the table this company i think is worth around $7 billion in assets and $11 billion in liability it is a little less than that. so is it bankrupt? you would say it could be but who owns a lot of that debt? it is him. he owns $2.6 billion of the debt some suggest he has been doing handling this as a slow liquidation. whether or not he was inspired, i don't know it takes a good mer chance you never had one there. >> we'll have to leave it there.

>> keep us posted. >> i will. thanks for having me >> thank you both very much. all right. if you invested with warren buffet you have a reason to chaer the second half of 2018. we'll be back. >> i know. we experienced that. >> watched the government shutdown and there's no immediate end in shtig what it could mean coming up don't go any where

welcome back the dow is down by 76 points or a third of 1%. having been up 240 just an hour or so before the close it had been a bit of a yo-yo session. s and p just negative. the russell up almost half of 1% shares of warren buffet on pace to finish this year positive mike is joining us now to track the rebound. i'm glad we don't look at it on a daily basis. >> it has kind of been lost. if you look at that against the

s&p here is what i find fascinating. if you go to june right here the blue was under performing by 7 percentage points. so for the firgs half of the year the rest of the market took off. faang was dominant still right here so on a relative basis why is that i would imagine it is largely because the market is now preferring quality stocks, very strong balance sheets, not so much exposure necessarily to kind of diceyer parts of credit. apple is down big. you'll have financial stocks not performing very well it shows you we are willing to overlook it could be another reason that

some value investors -- so relative to the ratio over ten years. you can see it got to a ten year low. the s&p isn't exactly what people look at it shows you it has been a rock bottom evaluation. >> that's fascinating sort of side point it has gone even cheaper when you saw that given how poorly things have done i guess the question is when he really loaded up on the banks as well he went from being a wells fargo and bank of america holder to having six financials, top ten in the last? >> anything he has done cannot move the needle for the overall value of the business. so i think it's much more about the fact that the core business

is insurance at least the largest piece of the core business and then the legacy ownership of b of a that you had before this year i don't think it's about whether he traded them well recently but if they come back in it would help i don't know if it's good for the overall market >> isn't it that people see it as a safer bet >> no doubt about it it is a defensive type investment. >> that was a nice circle you drew there >> you know, i have had -- i've had some bad runs. >> have you ever drown an infinity sign instead of a circle >> no. >> he gave you a b minus for the drawing. >>. time far news update now >> fascinating conversation. sheer what's happening now trump administration targeting

with to reduce toxic mercury they argue benefits to human health and the environment may not be worth the cost of the regulation rescue workers are trying to get coal miners trapped under the ground for 15 days rescue operations were suspended earlier following flash floods from a near by river >> bolsonaro met with nettbenjan netanyahu. -- on good rid ans day people shoed up to bring down or write down unpleasant memories it is so important they provide paper in case you don't have a specific document like a

marriage certificate or something like that to tear up why you would ever want to do that i don't flow. when y get married it is forever. >> thank you very much still ahead here on closing bell, facebook urnds fire again. the social media giant there hot water overleaked documents and weighing the risk, does a bare market predict a recession? we'll have that when we return [leaf blower] you should be mad at leaf blowers.

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facebook can't quit being in the headlines. thousands of moderators relied on inaccurate power points to determine what content would be allowed on the site. capping off a year of bad news the stock down 24% so far in 2018 a post on facebook this afternoon mark zuckerberg said many will take more than one year to address. ed, talk us through this latest story and what you guys found about facebook and how it made these kind of editorial decisions. >> so my colleagues at the

times, they spent weeks and months looking through documents that revealed how facebook manages all of the issues with the fake news, bad actors. it is really really crazy. so much of it is based on the sort of if then type of situation statements and it is sort of like customer service from hell a little bit this is what we say and this is what we do it is certainly imperfect but also really shows the breadth of the problems facebook has been dealing with for the past few years at least if not longer and there really is no good solution there's no al gogorism it is a good sign. issues are so broad that you wonder if facebook really requires fend mental changes that go beyond tweaking how they answer these issues. the risk will be that people leave if they don't feel comfortable on it.

>> we always debate whether or not they will face a lot more regulation that debate tends to focus on the data privacy side of things. i guess this story and this discussion point raises the other one. >> are they liable for the content that's published on the site they have a car in the telecommunications act as long as we make an attempt we are not responsible prior to them going up. it might be a factor in terms of how it might be one of the few

areas. is there an alternative facebook that would sort of spur facebook to act better? they keep saying they are and they will but there's no better sort of prompt than competition. right now you could be argued there is no real competition if it is seen as monopoly it is a way they could look into it and say we need to break you up or break you down or take some kind of action against you it is a lot of risk factors going into 2019. >> when you say it is a task that has no obvious solution keeping on top of all of this fraud or hate speech it might require fundamental change what might that even mean >> i think the easiest solution will be, you you know, hey i

look, you can't post stuff to facebook unless you're an approved publisher, much the way the publishing world works today. it would be an example of a change that could solve a lot of problems activity and engagement would drastically drop if they did that i think they are looking for some sort of ai or human intervention there's so much being posted on the service there's no way to really catch it all. even 99% is a figure they come up with. most of it is free and clean and good i don't know that that's going to be able to maintain that. he was talking about he has come up with an appeals process

he is trying to come up with courts and case law and legislation that the world abides by. facebook is borderless it has become this sort of super national entity and these are issues no one has faced before it is a huge undertaking it is not going to take more than a year. it will take multiple years. >> yeah. i think the solutions they are coming up with are not adequate at this point. thank you for joining us >> sure. >> it looks nice in the background this has a fake backdrop >> it is really guess? >> it could be definitely wouldn't have been. up next, the burning question, does it predict a recession? steve will break it down for us. >> the business of breaking things you're still stressed from this week's crazy market ride we may he a luavsotion for you whether he explain when the

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acan echo throughout ane entire community.nge that's why we proudly support, invest and volunteer in communities like yours. because the changes we make today... can you hear me? ...shape the possibilities of tomorrow. u.s. bank the power of possible. welcome back does a bare market signal a recession? steve joins us with more >> yeah. i have been crunching some data here it is terrible in terms of predicting recession it is better when it comes to telling us if we are in one. by the barest of margins it is not a bare market. we only closed 19.78%.

it is not the 20th, that unofficially denotes a bare market it is close enough to ask how smart is the average bear? here is the data we analyzed in the post war era five times there was no recession within a 24 month period eight times we were on the version of a recession it didn't give you too much warning, that 28% decline there. here are a couple of examples. 2001 there was a recession in three weeks. maybe you got out then maybe not. 2002 no recession. in both cases we were in a recession. a little bit more bad news here. after the decline here are bear essentials 8% further to fall in the next year a 14% increase.

the meanest of the bears we could find was 07/08 mt down 52%. the nicest bear down 19% in 1956 or 1957. right now we are about 15% below december 20th highs. so we are moving away from bare market territory that is good news. if we go back markets will have to worry not if a recession is coming but if we are already in one. >> is your headline that the bear market even if we do get into one is not necessarily suggesting a recession right now? >> no. it wouldn't tell you if one is coming it may tell you you're in one. >> got it. >> if i was going to just -- this is the nature of this type of analysis when you're using this kind of percent moves it would be that the 2002 bare market was the same as the 2001. >> right what are you going to do

you are going to take away the few samples i have i only have 13 to work with. we did look at what we call near bare numbers 19% doesn't help you out either. >> what do you sneen mean >> in terms of telling you whether or not there would be a recession. i was hoping that the market was a better predictor than the economist. i think they are both terrible >> that's funny. >> yes >> thank you very much >> pleasure. still ahead, the shutdown show down, seven days until a government show down, the big money impact and a live report from the nation's capital m coing up next. >> coming up on fast money a top strategist says he has the one chart you need to be watching heading into 2019.

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or they could agree to a larger funding bill that would last through the end of the fiscal year but keep the funding for homeland security unchanged. right now that option is the one that looks most likely that's why we'll go into shutdown day eight back to you. >> lasting long time

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from the markets roller coaster ride listen up, demolition rooms with popping up with people lining up to pay to break things eric chemy has the details for us >> reporter: there is a new business in town the premise, breaking stuff, people are spending money to come to places like the wrecking club in new york city to let out their rage and have a good time. >> oh, man. >> you got dishes, laptops, you get monitors we set up a room and you can go nuts. >> ready to brake stuff. >> i'm ready. >> tom daley be the founder is a former accountant he invested his life's savings to start the business. >> a couple of house rules then go nuts. >> he says he has never been happier. >> i do end up doing horror accounting now

i end up buried in sprechts but the numbers mean more. >> and business flourishes bachelor parties and first dates, the concept has caught on quickly. >> we set up the room for them what they do with that room is up to them. >> i decided to check it out firsthand. i admit i was nervous. ♪ >> i'm okay. i don't know to break anymore stuff. >> pricing starts at $25 and it goes up depending on the number of people you bring, the amount of time you spend and how much stuff you want to break. computers, tvs, printers, dishes and furniture. those are typical things people usually break. it's safe to say i had a smashing time. >> i don't think you were angry enough. >> you know, what happens you get so excited before gou, i was raging -- let's say the day before when you get there you are so happy you know you're about to do this you're happy before you

start. >> eric, i was wondering whether there is a sign of -- of which stock provides might go down were most of the tvs or laptops or one brand. >> i would say they're from the 90s. anything people want to get rid of goes here and you break it. >> maybe they'll have a lot of huawei. >> and blackberries were there. >> it's a sign of what's not working in the future. eric, great stuff thank you very much zwloo i knew it was familiar it was a bachelor date. >> there you go. >> how romantic from the show. >> from the show. >> anyway, let's talk about the markets. what do we expect? how do you process what happened this week and how we prepare for next week which is also a holiday, shortened week. >> a powerful bounce when it really needed to bounce. obviously we got so over going into christmas that i felt like you can't say much except that we reversed the overshoot to the

downside going into monday, right, it's a one day, final day of the carrier. your only trading to -- full day you have to have a full day for banks and funds to close books and so we'll -- we'll see. i think the tests are going to be a little bit above where we finished right now if you go up a another couple percent it's a lot of congestion where people feel lucky to sell there. >> and you said earlier you expect monday to be like today of lower volume rather than the earlier part of the holiday week which was high. >> i think you expect that and the volume you might get might grot be instructive because you will see the mechanical portfolio type moves. people knitting things up as opposed to expressing a view because of a response to any fundamental input. which we won't have until i guess at the earliest if we -- are we getting the the jobs number the first friday in january with the shutdown? there is not much to look ahead to fundamentally until then. >> there we go this is my last show for the

year i'm off monday sorry. but i wish you both a very happy new year it's been a pleasure as always working 2018 i can't wait for 2019. >> have a great trip. >> happy new year to everyone watching that does it for today for "closing bell." >> "fast money" begins right now. have a great weekend. "fast money" starpts right now. live from the nasdaq market site over looking noerkz's times square i'm melissa lee. carter wirth, brian kelly, jeff mills and steve grasso tonight on fast a wild ride but stocks having the first green week in what's been a red december if you missed the rally, don't worry, the chart master breaks down bha he says is the ultimate catch up trade plus if there is one things you need tosz heading into 2019 the strategist says it's this chart. what it is and what it means for the markets. but first we start with the december surprise on wall street stocks having one of the best weeks of the year with the s&p 500 up 4 percent