on bad news. my pick is alaska airlines >> schwab. >> buy as many as you can. duncan brands. >> great weekend everybody theexchange with kelly evans begins now thank you, scott and welcome to the exchange. i'm kelly evans and here's what's news as we enter the back half of the trading day. oil is moving lower as earnings season is about to start will guidance be a trip wire the government shutdown may not prevent -- may not be reporting housing numbers. can we trust private reports that housing is bad. and bezos break up could it hamper amazon >> kelly, we're down but well off the worst levels of the day.

take a look at the markets the dow is down 46 points. at one point we were down about 203 points on the dow. yes, down but not quite so bad s&p off by two points, we were down at 19 nasdaq composite off by one quarter by 1%. take a look at one sector. the consumer discretionary sector it has fallen by 22% to the lows that we saw on christmas eve but rallied by 14% from the upside to there that's the second best performing sector since december 24th only energy is better and then pbh shares one of the biggest moves, 8.4% to the upside because of a restructuring in the calvin klein brand. >> now day 21 of the government shutdown the it lasts until tomorrow it will officially become the longest in u.s. history. we have the very latest.

>> reporter: the focus here on capitol hill has been on the federal worker who is missing their first paycheck today the house and now the senate have voted to ensure that these workers do get paid whenever the shutdown ends because $2 billion that's how much workers are losing out on each pay period wordperiod s&p says the cost will be $6 billion and that's more than what president trump is asking for the border wall. >> speaking of the shutdown investors are getting more inferior obvious about it. bob pisani is live at the new york stock exchange with more on wall street. >> reporter: kelly, wall street is definitely starting to get more nervous there are a lot of analyst notes out in the last 24 hours in different sectors warning about the impact if the shutdown continues. let me show you the comment on airlines and hotel business. this is what they said the government shutdown will

impact the industry's corporate travel government contractors are not traveling during this shutdown longer it goes on the greater the impact other notes. the impact on lower income people who get food stamps prolonged government shutdowns jeopardize food stamps and other benefits the shutdown appears as it could last through earnings season which gets into full swing next week. citi, jpmorgan, goldman sachs and netflix are a few major companies set to report. joining me now is jeffries chief strategist you look like a rock star.

ali mccartney is also with us. glad you're both on. ali, i'll start with you are you paying more attention to the shutdown the macro picture doesn't have a huge effect but company by company it's picking up. >> you mentioned an interesting point when you first started the show we're seeing some of not only the unintended consequences of the shutdown and battle over the wall but what we're seeing it's going to affect the cleanliness and the timeliness of data that we on wall street and especially the fed looks at to make its decisions. the concern is not only sort of a first effect of what's happening but, you know, how is that going to affect payroll data, how does that affect what he understand truly about the fed's balance sheet. >> this has already come up. again general motors this morning their corporate guidance was fine others have not been so fortunate. >> so what i'm looking for and i think if you look at the market today it seems to be what the

market is pausing to wait for as well we're looking to see how the banks come out it's been touched on again today over the financial media you'll see some banks that had stronger trading some banks with weaker trading you have a favorable m and a environment. low but increasing interest rates. jpmorgan came out yesterday saying that they were raising their bonus pool so, you know, we're waiting to see what happens next week we're waiting to see not exactly as much focused on what people are staying about 2018, but there's some tough comps coming up i want to know what they are seeing we're seeing the high yield issuance come down we want to understand what the banks are planning forgoing forward in 2019. >> what's your forecast for the first quarter? >> we're still sticking in sort of the mid-twos to three area. i don't think there's a big gdp change the data story that you were talking about of missing a few

weeks or potentially months not a huge deal. we'll gate lot of private-sector reports. it's good the fed is in a pause mode the market is sort of feels to me the market is collectively taking a break here after what was a pretty unbelievable, you know, q4 and we're still -- >> the concern has been how much of a growth slow down we need to worry about for 2019 the numbers look like germany is going into recession now basically. who knows what's going won the uk there's only a little exposure for u.s. companies can our growth still be solid. >> i think our growth is still solid. jay powell has been flipping and flopping and still doing it. he's turninginto that flaky friend that says will meet you at 7:00 and never shows up and then comes at 9:00 and now we

don't listen to him much and maybe we'll listen to john williams who did great after the last press conference. >> you think that williams, some other members of the fed are better guiders of the market than the fed chair himself right now? >> i think -- look, we've watched jay sort of ad lib a fe times. he does pretty well when he has a piece of paper in front of him. it's not clear how well he does with the market when he's ad libbing. we'll learn a lot more but i think we can maybe start discounting a little bit because he -- >> so we've heard a lot about patience, waiting and see. ali, what's your base view

>> we still think we'll see two. the market doesn't agree with us now as we were just talking about, you have one conversation about potentially raising rates or pausing and another conversation about rates coming down right? i think the volatility of volatility across not only the market but the sources of information that we have right now is extraordinarily high. so we have a new and maybe not wholly understood and telegraphed fed chair. we have what continues to be an unorthodox administration that has us swinging one way with tax policy and one way with border control, government shutdowns and then a market that, you know, i don't think, we don't think it's rolling over but not have another 23% year. >> are you worried about the balance sheet and reducing that at the same time what do you think the timing of those two hikes will be. >> we miss march, probably later

in the year when we start to have some clarity around some of the things we were talking about. i've heard a lot in the media and today. we're not in a trade war we're in a situation where there's escalating protectionist rhetoric and it affected not only the u.s. and forecasting and maybe future on supply chain it affected the emerging markets, it affected china we need to get past this we need to get past march and change, potential change from 10% to 25% but we're not in a trade war but people are overwhelmed and it's causing some market dislocations in terms of having, again, this volatility of volatility and information and pricing. >> what do you think the fed should do, dave, this year >> i never like to say what i think the fed should do. people don't care. i like to them what i think they will do. i think they will pause. i thought that for a while i've gone out and said something

even more controversial to start the year, we have a higher probability of a rate cut than a rate hike. i could be wrong but i really do believe -- >> do you think there's no inflation. >> that's right. this is an important point we've been pushing this disinflationary risk a number of times. there's a whole host of source whether it's supply source of technology, corporate tax reform and deregulation or demand sources of economic tightening >> we had an expansion before where the fed didn't have to tighten. people can get raises. >> i think rich put this out there a few others put it out there. more about engineering a soft landing. the template you want to look at the rate hikes of '94, the mistake was we went too far. they cut in '95. from '95, '96, '97 we had a good run. >> it ended terribly

>> it always ends terribly because we have business cycles. >> we got to go. thank you for joining me here's what's ahead on the exchange coming up on the exchange, new reports suggest there's trouble brewing in the housing market and one state is seeing the worst of it. running on all cylinders gm says 2018 was a great year and 2019 looks even better could the government shutdown put travellers in a holding pattern? >> this is "the exchange" on cnbc i am a family man.

i am a techie dad. i believe the best technology should feel effortless. like magic. at comcast, it's my job to develop, apps and tools that simplify your experience.

my name is mike, i'm in product development at comcast. we're working to make things simple, easy and awesome. welcome back a lot of the economic data that investors rely on has been delayed because of the government shutdown. including sales numbers on newly built homes which we haven't seen since october diana, though, has some numbers. >> reporter: numbers were stunningly bad sales of newly built homes fell 18% in december compared with december of 2017 according to john burns real estate consulting which is your rays builders monthly. sales were down 19% annually in november sales particularly bad in northern california down 40% and

southern california down 49% rates did drop back in december and we apparently did not see a sales bump >> we've been seeing cancelations rise all year starting from 10% in january to 14% of sales cancelling in december and the feedback we're getting from our clients, their reasons are all over the map job skittishness visa issues. mortgage qualification >> reporter: the numbers confirm what some of the nation's largest public builders reported this week all because housing is just so unaffordable you see how affordant has weakened where you live. check out a map up on cnbc.com right now. >> are they down 40% and 49% from a month before or a year before >> reporter: from a year before. california is the priceyest market in the nation when you look at affordability and these people on the margins of buying california will get

hit the hardest. >> that's incredible how reliable is that >> reporter: look, john burns surveyors hundreds of builders it correlates very closely we also heard from toll brothers last month and they are the largest luxury home builder and seeing weak sales in california. so it all could relates. >> with the shutdowns becoming more frequent and longer lasting will companies have to rely more on private firms to get economic data let's bring in david >> congratulations on the new show >> we spent a lot of time in the past talking about economic indicators i want your take on whether -- we have the market, i assume survey which some people say is better is private-sector data going

become more data >> not all government shutdown the bureau of labor and statistics is up and running we'll get employment data and price data and much of the stuff that fed puts out in the industrial production report like electricity production and auto production that's data they collect themselves that's not affected by the shutdown that makes this different than in the past. but if there's less government data people will be looking more towards private-sector data and why that's a big deal now is because there's a lot of concern. the markets see the economy slowing. we haven't seen it in the data so far so people are wondering if this is an inflection point >> i like the fact the government stuff is accessible tons of charts and history and when private companies do it that often is not the case >> one thing that's bat about the shutdown you can't go the bureau of economic analysis because it's shutdown. >> there's so much information

while we have you i want to ask you about dave who thinks the u.s. economy is strong and healthy but because there's no inflation the federal reserve doesn't have to raise interest rates any more do you agree if so how unusual is that for something like this to happen? >> i agree withhim what he sai about the late '90s. that's one model the late '90s was a period of time where we had a burst of extreme productivity growth. i think the question now -- the economy is strong. i think the fact that there's an absence of inflation means the fed can as they say afford to be patient. i don't expect a rate hike before june if then. what's happened in the last couple of months it looks like the down side risks are growing so the problem is people are wonderi ining does the market s something that the economic forecasters don't yet see? is there something, the down side risks are worse than we

thought three months ago of course this becomes a self-fulfilling proif he circumstance a decline in the stock market bond rates, the shutdown, all that cancause a slow down in the economy. >> i was struck that he said as a market participant he stopped listen to powell and listen more to powell and others who better articulate the fed's agenda. i wonder if that's true of people widely speaking and if this is backfiring upon well that he's not a trained economist. he has a different approach. he doesn't come from a markets background he's a private equity guy. he's a lawyer. are all of these things coming to a head here and market participants losing confidence in him >> i don't think they've lost confidence in him. he's learning the ropes and made some communication mistakes. in a way it's a symptom of the fact that he likes to be a plain speaking person. he likes to speak to the public,

not members of congress and not mix it up with market and economic mumbo jumbo it's hard to be nuanced when you do that. it suggests the wisdom of both the white house putting rich in as vice chair and john williams in at the new york fed because they do have smoerns in ta-- mo experience in talking about monetary policy. he's getting his sea legs. i remember how interesting it was how ben bernanke made a few mistakes in his first year, being really glad he got that out of the way before we ended up in the global financial crisis it's hard. i don't think anybody who becomes chair of the fed no matter their background appreciates just how loud the mega phone is when you get that job and suddenly people are making investment decisions on whether you say just below versus almost.

so it takes a lot to get the hang of that >> david, that's great supremacist. thank you so much. great to see pup. coming up despite weak sales of the latest model apple is planning three new phones for later this year. should the company be simplifying it's product line or cut prices an investigation into the ll t and decline of a company caedhe per of luxury jets. the exchan "the excahnge" is back in two you always pay your insurance on time.

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welcome back to "the excahnge". shares of activision is falling. it will sell its shares to bungy. they are down 10% on this news how about caesars. carl icahn bought a stake. and netflix is one of the top performers raymond james put a $40 price target now to sue herrera for a news update >> hello here's what's happening at this hour a bus crash in western cuba killing at least seven people and injohannesburg 33 others including foreign tourists local media reporting the

accident occurred when the driver lost control of the vehicle. turkey is deploying more troops and armor to an area on its southern border with syria held by u.s. supported kurdish militia. one turkish news agency reporting troops heading towards mambese. soccer star cristiano ronaldo is said to be very calm despite being asked to provide dna in rape accusations from an american woman back here at home startling new numbers from the cdc show just how widespread the flu is between 6 and 7 million have had the flu with 64 and 89,000 hospitalized the flu is widespread in 30 states you're up to date.

that's the news update at this hour back to you. >> tyler mathison is here and we're counting the days of the shutdown as it becomes more serious. >> today is the first day that paychecks haven't been paid to federal workers. there will be pain and a lot of stories will come out about that it's not just the federal workers. it's companies that do business with federal businesses that are being affected and we'll that have owner of one such firm, very well known catering company known ridgewells they are finding that their revenues are down 50%. if this shutdown goes through monday it will cost them $130,000 a couple more months it will cost them half a million dollars in lost revenues we'll talk to the owner of that business how it's affecting her world and so far she hasn't had to lay off anybody but that, obviously could change

>> january is such a slow period it's not like it's the fall or spring, maybe turn around and gin up a few other events. >> let's say you're a big company and you have an event planned at the air and space museum in d.c. it's closed. you can do it. that stuff may get rescheduled later in the year but who knows. >> with the events business some days it's that day or no day >> i want to know can i rent that funky desk you sit at for weekend parties. >> my compliments. >> we'll see you in a half hour. >> here's what's coming up on "the excahnge" >> announcer: ahead, could jeff bezos divorce have an impact on the future control of the company? plus the changing face of the mall and one sick boat. why royal caribbean is writing a big refund check

welcome back let's catch you up on a few headlines. it's time for rapid fire and here with their takes is courtney regan alongside our

leslie pecker and also here is phil lebeau. shares of gm are up 8% after the company raised 2019 guidance to 6.50 to 7 bucks a share. phil this to me the company saying china is strong >> it's going to be flat sales for 2019 in gm's opinion relative to 2018 for the industry overall about 27 million vehicles. remember over the last couple of months we've heard people saying, is the china consumer slowing down there clearly is too much capacity for auto production that's what's weighing on those automakers in gm's perspective they have the portfolio and the strength in china and they are number, two a strong number two to weather any slow down in the consumer market. >> why are they not seeing any push back on brands. the star buck analyst are concerned people won't carry starbucks around because of

trade disputes they will go with the local brand. >> interesting when you look at it they have a local chinese partner. that's who most of their vehicle partnerships are with. it is strong within china. you got a combination of a strong local partner along with fact that we haven't seen it not just for general motors but the entire auto industry we've yet to see this no i'm not buying anything that's american made >> we're not seeing with it nike either when they crack -- >> there's going to be some soft resistance to some brands because we're so long there's something about american brands that many chinese consumers really like. names like j. crew, gap, things that are very, very american we'll watch things like that levis. at one point i talked to le levi cfo and he was concerned about american brands being tarnished. everyone is watching >> no blow back. next the "wall street journal report"ing that apple plans to unveil three more iphone models

this year. they will have updated camera features something called triple rear camera. it will be on the higher end models is this the iphone 11? >> sounds more like a car. triple rear. i don't know i think the big question here and this is the big issue for investors surrounding apple right now is this issue of upgrades and what gets somebody to upgrade is it functionality or aesthetics and whether these upgrades will cause consumers to purchase something that's $1,000 remains to be seen especially when the functionality they are introducing -- >> i think of apple -- microsoft back in the day had a proliferation of different operating systems. apple is a very streamlined company. have they lost that with these different iphone models? it is like toothpaste.

a type for whatever your habit is and whatever your needs are >> that's the big question at its core, no pun intended, apple is a luxury brand. if you're going to spend $1,000 on an iphone you want it to look like a luxury product. the functionality aspect is important. but there's lots of copycats all over the world that's providing good functionality at a fraction of the price >> if you spend that much there should be a noticeable improvement. what i hear why should i spend $1,000 to do what i can do now >> i have the 8 and am perfectly happy with it. amazon may expand whole foods by moving in tomorrow ti stores of sears and other retailers. google moving into the former west l.a. mall do grocery stores in shopping malaysia make sense? >> they make sense because they are traffic drivers. if i'm a landlord i want a

reason for foot steps to the mall kohl's is doing co-locating hoping people have to go once or twice to aldi >> for notice get into the small hassle >> exactly that's why i'm not saying that the store isn't right. i know of one instance where a k-mart went out and a whole foods moved in, in south carolina it could happen. you're right it's a little bit of a pain. also if i'm whole foods i catere consumer these are in these c and d rated strip malaysia i'm not sure that's super valuable real estate >> let's talk about what's happening with the government shutdown miami international airport is closing one of its terminals this weekend overconcerns it

won't have enough tsa screeners for checkpoints. screeners are calling in sick or quitting all together. should travellers be nervous >> not yet we're getting to point to. if you remember, i want to say it was the summer of 2017 when you had those long lines where people were missing flights, that's the next domino to fall i wouldn't be surprised to see that in the next week two where you just don't have enough tsa agents that you start to see these long lines and people start to miss flights or the airlines are forced to amend their schedules. >> i was just going say. i just flew indianapolis yesterday and the day before and everything was fine but i did get to the airport earlier because i was flying out of new york and indianapolis. new york is a crowded airport. indianapolis may have fewer workers to choose from let's be careful it was okay. they didn't look entirely happy but it was okay. >> there's a question of the

trickle down effect to the overall economy. if people are not flying, let's say i'm a consultant and i have a project i could win now or try to win next month and i postpone that because i don't want to do business travel during this situation that is what will happen >> when the lines kick in is when people say nope not flying. >> the longer this goes on we'll see more of a shake out. i want to see a show of hands. royal caribbean turning around one much its cruise ships after nearly 300 passengers and crew became sick. norovirus. the cruise lines says the oasis of the seas will dock early. guests will receive a full refund raise your nand you're a cruiser. >> would you go back >> i would >> i would >> i haven't and my brother was stuck on one of those cruise ships where the sanitation system -- he was on the poop

cruise and i know it's childish, i bring it up to him all the time. he's back on a cruise right now. he said it's not that bad. >> why a norovirus >> i don't know what the norovirus is whether the flu shot helps >> it's g.i. >> be glad i don't know what it is >> thank you a cnbc investigation found one private jet company has least trail of broken promises outraged customers, security concerns aborder its flights this story is next on the exchange

welcome back it was dubbed the uber of tra l travel now a cnbc investigation finds the company known for glamour in the sky is caught in a downward

draft with angry customers and security >> i'm obsessed with jet smarter. >> i took off for l.a. >> super cool. >> jet smarter >> jet smarter >> amazing >> have a great flight and jet smarter. >> reporter: it took the private jet set by storm with a simple app and a dazzling image campaign and press coverage, jet smarter claimed to revolutionize the business of private jet travel the company had a star-studded take off raising millions from investors that included the saudi royal family and jay-z no shortage of big name endorsement. they signed up 10,000 members

and became the first airline valued at over $1 billion. jet smarter has left a trail of outraged customers millions of dollars in loss and concerns about some passengers on flights customers around the country, some paying nearly $100,000 for multi-year memberships now call the company a fraud. a hi-tech shell came and an unlawful bait and switch >> the way the system works -- >> reporter: it sounded so promising in 2016 when jet smarter then 27-year-old ceo and founder appeared on cnbc >> we offer about 50,000 hours of scheduled flights every year. that's like 120 flights a day. plenty of lobster for everybody to go around >> reporter: the members feasted at least in the beginning. unlike most private jet companies, jet smarter sells

individual seats on its planes which customers book with the app. sally is a broadway producer who travels between her los angeles home and new york. she paid $9,000 annual membership to join jet smarter in early 2015 which allowed her unlimited private jet flights. >> the value proposition in the original company was just kind of ridiculous. it seemed too good to be true really >> reporter: it was too good to last jet smarter began stripping away the benefits of membership no more free choppers. no more free food. and last year it told customers they would now have to pay for flights which were supposed to be included in their membership. >> only [ bleep ] this is not what i signed up for this is a bait and switch. >> reporter: customers told us the changes made their expensive

memberships virtually worthless. the company said the terms are subject to change, suspension or termination at any time. jet smarter told cnbc the vast majority of our core customers understand the necessity of these decisions and it is elevating the quality of people flying together. andrew pressler was one of the jet smarter sales people signing up those members he said he was under pressure to hit aggressive sales targets >> every other month there was a new, what the sales floor would call a money grab. >> that's what the sales guys called it. >> reporter: he was fired. the company said it was poor performance and that he lied to customers. though he said it was likely due to a call over a competing job offer. he posted what happened on linkedin where he called the company cold hearted for firing him but said he remain passionate about the product

they provide and then he got this threatening letter from jet smarter's general counsel calling the post false and libellous. >> where were they so threatened by me. i have no idea maybe because the truth got out. >> reporter: cnbc learned jet smarter has fallen short on its promises to investors. jet smarter made this confidential presentation to potential investors in 2017. revenues would grow from $252 mill thrown $2 billion in two years and membership would jump from 11,000 to over 100,000 by 2020 by the losses kept growing today's membership around 8,000. jet smarter refused to comment on its financials. members are also concerned about security aboard jet smarter flights. >> take me to new york now >> reporter: we obtained this

video, a disk jockey aboard a jet smarter flight in september from las vegas to white plains, new york about 45 minutes into the trip according to court records he began threatening passengers >> heads will be chopped off >> reporter: the pilot made an emergency landing in nebraska where authorities subdued and arrested him for making terroristic threats. jet smarter said it has the most rigorous security standards in private aviation, including background checks on a majority of customers before they fly and on the ground security teams that screen for narcotics, explosives, cash and weapons for shared flights but two people on the flight told us there was no security check. and there was this red flag. just three days before the flight, paola tweeted from a jail cell to a private jet they

can't stop me. pae passengers and crusade they witnessed passengers trying to carry drugs on their flights this suitcase packed with suspected marijuana was confiscated from a passenger the picture taken by a crew member >> there were definitely drug dealers of all kinds who were carrying lots of cash on the planes and, you know, in designer bags. >> reporter: jet smart he denied any allegations of fraud or bait and switch tactics while acknowledging that a number of members are unhappy with certain changes. the company said it is more positive about the health of our business than ever for the ceo the original jet smarter dream appears to be further and further away >> robert frank joins me now robert, not just this company and the challenges that we're talking about but i wonder if this causes a crackdown having just watched this on all private jet travel because people are trafficking cash and drugs and

they are not be screened >> there's been one update we learned that the fbi has been asking questions about jet smarter. the nature and the subject of that inquiry is unclear but an industry executive we spoke with said he was questioned by two fbi agents aboutest smarter's business sources of funds cash and drugs on those flights. the fbi won't comment on any potential investigations, jet smarter says it has never been the subject of an fbi investigation. particularly when it comes to these shared flights where you're on a private jet with people who bought individual seats, but have not gone through any security, that's a risk that people hadn't really perhaps thought about. >> is jet smarter still flying right now >> absolutely. >> do you think most travellers have any idea all of this is going on >> i think a lot of travellers knew one of the great advantages of flying private is no security i think now they are thinking about the down side of that. >> robert, thank you great stuff.

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i am a techie dad.n. i believe the best technology should feel effortless. like magic. at comcast, it's my job to develop, apps and tools that simplify your experience. my name is mike, i'm in product development at comcast. we're working to make things simple, easy and awesome.

welcome back here's a check of markets as we head towards the 2:00 p.m. hour. looking at a decline in the dow about 77 points right now. a third of 1% and s&p down a quarter of a percent and nasdaq down more than that and you can see the nasdaq below 7,000 the ten year is also below about 2.7% right now and continued to soften that yield has ever since we heard from fed chair jerome powell yesterday oil also breaking its win streak down more than 2% today. still on a tear for the week up 7% and that's because we had a 9 or 10 day win streak before we took a breath here and markets followed suit. up next, latest details about amazon founder jeff bezos divorce and do investors need to worry about his akste in the company? "the exchange" is back after this hey there people eligible for medicare.

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tick, tick, tick, time for a wrap up. a medicare supplement plan helps pay some of what medicare doesn't. you know, the pizza slice. it allows you to choose any doctor, who accepts medicare patients... and these are the only plans of their kind endorsed by aarp. whew! call or go online and find out more. the world's richest couple, jeff and mckenzie bezos play into divorce and mckenzie could get half of jeff's 80 million shares of amazon could the world's most valuable company be up for grabs? robert frank and joined by peter

henning, security law professor and a former senior attorney at the s.e.c. good to have you here. professor, i'll start with you what do you think is the most likely outcome here? are half of his amazon shares going to go to his wife? >> well, they're from washington which is a community property state so she has a claim to half the shares my bet is they'll work out some type of an agreement but it may require him to start selling his shares because he has a claim essentially to $65 billion that's not an easy check to write, so we could well see jeff selling shares in the near future to try to fund some type of settlement. >> what does her intentions have to do with what happens here and in other words, if she says, i want what's best for the company and a big shareholder too, does that mean he could retain control somehow too? what are the options >> one option is certainly to transfer her some shares but not

the entire 8% of his holdings, come up with some type of an agreement to buy her out, but if she demands half the shares, then she becomes the second largest shareholder of amazon or equal to jeff and so will she claim a seat on the board? how is this all going to play out? a lot of this will depend on how friendly the divorce is and there aren't that many friendly divorces outthere, so that par is the real unknown here for investors. if this got ugly, it could really take a toll on the company. >> that's why the details that have emerged have grabbed so much attention because they're a little salacious and makes you wonder how this will feel now as this has all been so public and what do you think about mckenzie bezos being a steward of this company? obviously, it's in her own interest to do well now but what do we know about her >> like a lot of billionaire

divorces, the day one announcement is always, this is amicable we're best friends, and the biggest analogy here is the steve wynn divorce similar thing. they split the shares. they had a very complex agreement that seemed ironclad split the shares, vote together, she would support him. look at what happened. once you make your ex-wife your co-biggest shareholder, you don't know and there's a lot of things that could play here with emotions and family and rivalries. you just don't know how it's going to play out. the only question i have for peter is, is there a way to transfer the shares to perhaps a trust for the kids or pledge them over a period of time where from an s.e.c. point of view, he is still the, quote, beneficial owner but somehow, they're either pledged in the future or to his kids and he retains some voting right >> one way that you could do it would be, and again, the wynn

divorce is one way where you have a voting trust agreement. so you could transfer ownership of the shares but jeff could keep control of the voting rights, which is one possibility, but this is going to be very complex and i guess the real key question here is just how amicable is this going to be? it started out earlier this week amicable but if it becomes a fight, then under the community property laws, mckenzie has the right to take 50% of the shares. she could own 8% of amazon. >> i wonder to what extent any of this has to become public froma material information point of view because the assumption has been, they'll do this privately it will be quiet we won't ever hear about it but from an sec point of view, isn't he required to file with the sec any kind of share agreement that would affect his ownership or the shares >> one word, peter >> absolutely and any transfer

of shares has to be reported >> all right >> we will hear about it. >> you're right. peter henning, thank you so much for joining us and robert frank as well. that does it for "the exchange." "power lunch" begins right now kelly and david, welcome everybody to "power lunch. i'm tyler mathisen new at 2:00. broader markets struggling today but not netflix. we'll explain that one 2018, a record for pc investment how is 2019 looking and the government shutdown, real world impact on small business "power lunch" begins right now >> welcome to "power lunch." i'm melissa lee. breaking news right now on the banks and the impact of the shutdown steve liesman has all the details. steve? >> melissa, thank you very much. the federal reserve and several bank agencies out now with guidance to the financial firms to work with those affected by the government shutdown. regulators urging for