killed >> stor, new all-time high right now, how many stocks do you say that about >> cisco systems, great cash flow, great cash balances. if it is not on concern's wakev list, it should be >> that is it for us "the exchange" begins now. thank you, hi everybody. and here is what is ahead. a murky outlook. in less than 24 hours, eight companies have lowered or given weaker than expected guidance. we'll tell you why and what is going on there the wealth war, attack on the wealthy is growing louder as the 2020 race begins to unfold and apple reports after the bell today, this after its big warning a few weeks back how do they set the bar low enough now we'll begin with the modest rally at least in the dow. dom chu with the numbers >> a lot of catalysts. if you take a look at the movement, we did turn into negative territory at one point

for the dow, now up by about 65 points but the s&p has been right around flat and the nasdaq has been the real laggard. one place to look at in terms of a strong move to the up side that continues today, check out the real estate sector within the s&p 500. this sector and one of the etfs that tracks it is up about 13% since the lows that we saw back on october 24th. and get this, it has been a positive trade this etf, 31 of the last 35 days, that strong move continuing today. and one stock to watch, best performer in the s&p 500, we're talking about glass works. corning up by over 10% at this stage thanks in large part to strength from a lot of telecom companies upgrading to 5 g corning certainly a stock to watch. and by the way, they said that they are not as worried about china and trade on their business >> wow all right. thank you. welcome to the exchange,

everybody. markets are rallying today at least in the dow there was rough news on consumer confidence declining to its lowest level in 18 months. oil prices back up after the u.s. slapped venezuela with sanctions. home price gains tistill up 5% from a year ago. and lots of companies have been slashing their guidance. bob pisani is down at the nyse with more on this for us >> it is 2019 earnings guidance we care about and the markets are holding up darn well considering the lousy earnings guidance we've gotten in the last 24 hours. big names giving disappointing guidance pfizer, 3 m, lockheed martin, whirlpool, harley a debacle. a couple had positive comments verizon was about in line. rockwell automation, dover, rox, xerox, they were decent.

we're a quarter of the way through earnings so far, fewer top and bottom line beats in the fourth quarter earnings growth rate was slowing in the fourth quarter. and we care about the guidance trending downwards i think we're up today for a few reasons. remember the market tends to go up in the 24 hours before the fed meeting. and finally a lot of optimism on the trade talks. back to you. >> thank you and here is what is interesting about the trade talks. but first let's talk about companies cutting earnings guidance joining me is john augustine at huntington private bank, dom chew back ch back as well so this earnings bit, the guidance is not great. maybe we're resetting the bar now for later in the year. but what do you think is going on here in. >> we agree with that, underpromise over deliver.

upod >> upod. >> yeah, we've been seeing them step over some lower bars so far this quarter we zek that the same continues as the year progresses >> so who are the names that you would like to own in this kind of environment >> well, the ones that are spread across our three equity portfolios, kind of our all purpose stocks for us. think of microsoft, we think that they will have a good report mcdonald's will report tomorrow, that is another consistent company across our three portfolios johnson & johnson is another one that we like, again this consistency theme. and the utility down in florida are seeing good growth now so those four names are spread across three portfolios, different objectives kind of all-purpose stocks for our team. >> and that consistency comes at a price. microsoft is the biggest company in the world and expectations are pretty high. not saying that they haven't been tempered a bit in the

selloff last year, but we're about to get the most important barometers and people always talk about faang as the tech companies but really the biggest company xs suppoexposed for glol growth >> absolutely. and it is all about the expectations which is why what john said about upod kind of resonates at this stage of the market given the action that we've seen over the past couple we'eks, it is fairly safe to say many are gearing up for the idea that companies are frying to talk down or temper some of their guidance what is interesting now is if you are a ceo that is about to report numbers, this is the time that you may want to think about further tempering those expectations because the market is in essence giving you a pass at this point. >> because they're saying everyone is doing it >> right i've been combing through all of the earning transcripts. the number of times china has been mentioned, the number of times slowdown has been mentioned, the numb times shutdown has been mentioned, you

get the sense that there is a narrative developing and it is giving you the opportunity to say hey, let's get all of this stuff out there in the open right now and set that bhar pretty low >> and that is kind of the rhetoric and which matters a lot, but what is the reality are we seeing an earnings recession like bob pisani warned about yet? >> yeah, we haven't seen that, we don't suspect that at huntington to us this will be nothing like 2015, 2016 where we saw four quarters in a row of will her s&p 500 earnings the first quarter maybe we get 2%, 3% we just didn't see an earnings recession absent is some unknown headline affecting us. >> you could argue it feels like a recession, for earnings it almost is one even to be growing at such a low number upod is what i'm taking from this one i'll life i'll live my life that way.

>> better than the alternative >> thanks, guys. surprisingly not moving markets much is the news on the china front. wall street journal saying that there is still a hard slog ahead and big divisions remain for the trade talks this week. and now the u.s. is requesting the extradition of becauhuawei o from canada. deidre has the latest for us >> and a day after those charges and that request, meng wanzhou is back in court in vancouver on bail technicalities. but the key we're looking for is next wednesday, that is when the dates will be set for her extradition hearing. now, what has been interesting in the last 24 hours is that the chinese response to the u.s. has been somewhat restrained it is still early, but it may be that beijing has fewer ways to respond to this broad crackdown on one of its biggest and most important companies. remember the chinese economy is slowing and trade talks kick off

tomorrow huawei itself is facing bands of its equipment around the world so while the u.s. rolled out some high officials to announce the charges, the chinese foreign ministry in its response strongly urged the u.s. to stop the unreasonable crackdown on china sneeze compa chinese companies and says that it will defend huawei. a report saying huawei should try to minimize losses compare that to the hard line beijing took towards canada threatening grave consequences following up by detaining two canadian citizens. >> almost like they are channeling all their fury toward canada knowing that they can't upset the u.s. too much. there are wouare two tracks of criminal charges, the one that involves the robot at t-mobile and also the iran sanctions. what happens if canada says we don't have iran sanctions, huawei didn't violate any laws

as far as we're concerned. >> and i think that is why the u.s. authorities have been very careful in framing the charges against meng wanzhou and involving the robot. it is not necessarily related to the iran sanctions, they are saying take meng wanzhou lied to american banks so that could be criminal in the u.s. and canada. but you're right, this is incredibly complicated and the two different tracks involving stolen, allegedly, stolen ip and meng wanzhou show this is is a full court pregs ss by the u.s. senior trump officials are getting ready for the trade talks tomorrow will these charges against huawei be an obstacle? joining me is senior fellow at the peterson institute and author of the new book the state strikes back, end of economic reform in china. thank you for joining me

lots of people are saying china's growth is slowing. but you think the slowdown goes deeper >> i do, i think the slowdown has been in evidence for a few years. and it is primarily because state companies have been taking a larger and larger role, but they are very inefficient, they are absorbing more capital the private sector cho has been the big source of growth has been squeezed out. >> and xi jinping knows this and he also has now the u.s. to contend with which is demanding that it open itself up more and stop stealing trade secrets. how does he balance the demands of the u.s. with the slowing of the economy. >> he likes to boost up the state sector even if it is inefficient because it gives him more control and he wants the power. if he allows the market to play a greater role, it will undermine the ability of the party to control everything. >> can he acknowledge that the

only way for china to flow now is to basically unleash the animal spirits of the chinese people, the chinese economy and that requires reforms, didn't it the idea that they can keep creating ghost cities and spending in a top down way, have they already gotten to the end of that road >> i think that it will be tough for him to change course particularly in the short run. he has invested so much over and over again for five years, he's been saying we need to have bigger state companies so now to switch and put more reliance on the market, i think it is something that he should do and maybe he will do it eventually, but i think in the short run it is very unlikely. >> what do you expect the chinese to put on the table to come to an agreement and avoid the u.s. jacking up tariffs? a couple things have beenan imp over six year, maybe modest reforms. what do you really expect? >> i think that they will do some things on the structural

side in addition to pledging to buy a lot more goods i think that they will open up more sectors without a foreign ownership cap. we've seen a bit of that in the financial sector already where they are allowing better access. i think that they will extend that to some additional areas. that helps to address the technology transfer because if you have a wholly foreign owned company, you don't have to transfer your technology to a domestic partner >> so that brings us back to the strunkts al structural reforms that they may make tiny steps or just try to make it looks like it is happening. hard to tell and the slowing economy which has deeper problems. for investors who are wary of investing in any company with exposure to china right now, caterpillar only 10% of its sales from there, is caterpillar going to be okay, is china going to slow further from what we're seeing now >> well, i think if xi does not

change course and move more towards the market, they could well slow down even if they settle the trade dispute this week in high level negotiations. it is likely that they will slow over the nekxt two years >> so what do you have in mind, 4%, 2% >> they won't go that low, but they could be in the fives within a couple years. >> so you really think they are up in the sixes now? >> i think they are close to six. they say 6.6 for the year, but it was slowing continuously during the year. you have to remember their i imports grew a 15% and imports last year, you don't get that kind of growth if you are only -- of imports if your real growth of the underlying economy is only 2% or 3% so i don't think they have falsified things dramatically. >> and the longer term problem is a ways off still. this is the battle, that is the war. >> right >> thank you so much here is what is ahead on the

exchange >> coming up, a new congress and the rice for 2020. are big taxes on the wealthy a winning ticket j former representative weighs in. and harley-davidson reports weak sales. what is driving people away from motorcycles? apple's big day. the tech giant set to report earning after the bell following its disappointing pre-announcement will there be anymore surprises. everybody all set? oh, any recommendations? the salmon roll's ok. just ok? is it fresh? sort of. the chef had it this morning. unfortunately he went home sick, but he left instructions with kyle! this fish is raw. do we need a minute? yes. just ok is not ok.

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first elizabeth warren proposed a wealth tax as part of her 2020 platform. and then alexandria ocasio-cortez said the system that allows bill i don't know theirs to exist is immoral is there a real assault under way on the wealthy joining me to talk about that and more is former texas congressman jeb hensarling thank you for joining me is this just emerging on the left or is there a sense in this country broadly speaking that the economic system favors the wealthy and therefore wealth taxes should be imposed? >> well, i think the 2020 presidential election started early and i think there is a real race to turn america into venezuela. i find of counterintuitive to think that for most americans we

are enjoying the very best economy of their lifetimes and yet we see on the far left the politics of division in greed identity politics seemingly is allege live and well so on the one hand, i'm fearful of it because in america we do not traditionally vilify success, we celebrate success. and i've had a number of jobs in my life before i went to congress i did everything from clean out chicken houses to work at a window factory to being an officer in an investment management firm. and guess what a successful person had to hire me each and every time to create wealth and jobs and hope and opportunity. and that is what we're seeing today. so i'm not sure it will work, but it is a very worrisome strain in american politics particularly as we see unfolds in a socialist paradise like venezuela. >> and we seem to allow people

like howard schultz more leeway than those who came up through the financial sector frankly so what do we talk about the rhetoric around it though? it is interesting on both the right and left people will say that the economic system isn't working and on the left they say it is because of wealth inequality and needs to be -- all the things you were just addressing on the right they say because of overregulation and it seems like that is a lot of what president trump is trying to do right now, but is a deregulatory message one that is likely to work with the millennials in particular? >> well, i'm not sure deregulation per se, but certainly opportunity and not wanting to have kind of a top down washington-driven economy i think a lot of millennials are looking something that is more organically driven and i do believe ultimately they want equality of opportunity as opposed to equality of outcome that is a message that i think

that they can rally around but again, this idea that somehow if you build a business that some how you're guilty until proven innocent of exploitation is just something that i don't think ultimately is going to sell. and so you know, in the last election, republicans didn't fare too well in the house and to some extent it was a referendum on the president and i hope he is paying attention. on the other hand, i think that his record is going to look pretty good compared to the heated rhetoric of an elizabeth warren or bernie sanders or even somebody trying to take us to the race to the bottom of venezuela. i just don't think ultimately that is going to be successful and i also know that lot of the democrats who were just elected, their so-called majority makers that allowed them to have the majority, they have much more moderate views and they came from a lot of districts that are either swing districts or districts that president trump won. so it will be a real contest within the democratic party for

the heart and soul of the party. >> and what is interesting to me, when you ask people about their trust in institutions these day, ceos and their employers often get the highest marks and this is very true for young people in particular >> higher than congress? >> much higher than congress higher than the media too. we're down there with you. >> go figure >> are but there does seem to be an individual trust in your employer or your ceo or the way that lot of them have adopted a lot of progressive mantles sometimes. but when you pose the concept more broadly, the trust erodes so i wanted to ask you about maxine waters taking the heldment financial services committee, hauling the big banks before congress. is the outrage about big banks like it was five or ten years ago or not what is she likely to ask them and what is at risk for them appearing? >> i do think that some people are living in a time warn. however number one, in divided government, i don't see significant pieces of

legislation that get on the president's desk between a democratic house and republican senate, i don't think that is where it is headed now, when i was chairman of the house financial services committee, i did have the power of subpoena. now maxine waters has the power of subpoena. she is capable of being a serious legislator and she is also capable committee into the spanish inquisition and she's already indicated an interest this hauling up the head of wells fargo and deutsche bank. so my guess is any bank that had any connection whatsoever to financing any aspect of the trump empire may find themselves in front of the committee. on the other hand, any bank that has done -- gets a bad headline also might be there. and some may deserve to be there. but at the end of the day, again i think that there are some people living in a time warn because right now again we're seeing 3% economic growth.

didn doesn't solve every problem, but it does -- >> growth cures a lot of ills. there is so much more that we could talk about, the shutdown, whether he declares a national emergency. because we have the fed meeting this week and there are repoores that the president may want more dovish members, is he taking us down a risky path potentially? >> well, i have been pleased, the president in the past has asked my advice on the federal reserve. he doesn't always take it when it comes to the nominations. but as we well know, i think a case could be made for qe 1, not so much for qe-2 and qe-3. and our february has gone federv has gone to a play where they haven't gone before. and they have to unwind the

historically large balance sheet -- >> or not depending on who he appoints >> or who he doesn't appoint long term we need sustainable long term economic growth and i fear that the fed's footprints remains too large in the economy. >> you want them to shrink it more now they are backing away maybe. >> yeah, i am concerned. i think that the balance sheet is too large both its size and its composition worries me we still have way too much mortgage backed securities and i think that we've asked monetary policy to do things that monetary policy cannot do what we want is we want long term price stability, that will promote long term economic growth but i can kind of understand the president's view it is like, hey, i show up at the party and all of a sudden they are taking the punch bowl away and so i understand his concern. i think what we want is for the fed to get to a neutral rate

my reading of the data is that they are already there or soon to get there i'm much more concerned that their footprint is too large in the economy and they have to wind down these mortgage backed securities >> that will be the focus absolutely congressman hensarling, thank you so much for your time. >> thank you coming up, shares of game stop down 27% today. we'll look at what is behind that huge drop that huge drop plus kols 's tmi uhl eang [knocking]p with ww more on that ahead ♪ ♪ memories. what we deliver by delivering.

♪ ♪ our new, hot, fresh breakfast will get you the readiest. (buzzer sound) holiday inn express. be the readiest.

welcome back here are some of the moveders this hour. gamestop is down more than 27% following the company ending the process to sell itself that decline shaving nearly $360 million in market value. xerox going the other way. it is soaring after beating estimated and getting better than expected 2019 guidance. so a positive guidance piece of news today it is up 11% home builder posting the biggest decline in orders of five years. and now to sue herera for a cnbc news update. hello, everyone. the director of national

intelligence dan coats warning that north korea is unlikely to give up its nuclear weapons. his comments came at a senate intelligence committee hearing >> we currently assess that north korea will seek to retain its wmd capabilities and is unlikely to completely give units nuclear weapons and production capabilities because its leaders ultimately view nuclear weapons as critical to regime survival. syrian president assad meeting with iran's first vice president in damascus. he says new trade agreements will help the two countries face the economic war wageed against them in the west perdue foods is recalling 12 ounce packages of fun shape chicken breast nuggets with the use by date of march 11 of 2019. the product contains a known allergen, milk, but that is not listed on the label. you are up-to-date

kelly, back to you >> i eat a lot of chicken nuggets. sue, thank you i'm joined by melissa lee and i think the biggest headline from the last 24 hours is what happened with andrew and howard schultz last night >> i think it was a fascinating interview. the heckler spoke volumes in terms of potential backlash that starbucks could face and i think investors have questions that they should be asking of starbucks. first of all, will the company be driven in terms of its actions to do what is politically right in view of the schultz's campaign for president and will there be a backlash not just by democrats, also republicans and how could that impact -- >> you mean against the business >> against the business. two-thirds of the company's total revenues come from the americas the big bulk of that is the u.s. of course and already the u.s. growth is slowing. >> and even that was a positive surprise >> exactly and they are facing wage pressures. so the question is even at the

margin, even if the brand is a part of the investment pieces. >> all right we'll have more on that in the next hour. here is what is coming up on "the exchange. ahead -- i can hear you now. how a flaw in apple's facetime is letting people listen to others undetected. did wynn just get a big win? and the hustle culture how 18 hourworkdays became the norm for t merheodn day workforce.

welcome back it is time for rapid fire. we break down a few more headlines. joining me are jon fortt, contessa brewer and frank holland. let's talk some khashoggi. first up is harley-davidson taking today down more than 7 percent after weak fourth quarter results and they expect the rest of 2019 to be challenging. they have declining sales especially in the u.s. they are not i guess cool? >> i don't know if it is not cool, but the average harley buyer is a man in his 50s that make 90 k or more.

>> are the younger on electric scooters >> harley will have the same problem that carmakers will encounter, why do you need to get your driver's license if you have uber to get you around. if they see motorcycle as a form of transportation and not a lifestyle hobby choice and plus boomers bless their hearts are getting old and a lot will get too old to ride motorcycles. at some point you have to age out of that kind of -- >> you have to be able to grow a beard first. so the millennials should be good with that but they are actually falling off less internationally which is an interesting -- they were getting in trouble with the president remember are for not building more harleys here in the u.s. >> about your the sales are falling internationally. shipments are down >> but not as much as they are here so the culture around it still seems to be stronger internationally than it is here. they will probably have to look outside the u.s. for growth. >> like go jack is you hail a motorcycle

anyway, let's talk about this next headline, the investigation into wynn resorts and how they handled steve wynn's sexual misconduct complaints now wrapping up with a settlement in nevada the company admitting that its executives failed to act, but did they come to financial terms? >> no, and this is not a settle little a complaint got filed in a ends the investigation, it now goes to the nevada gaming commission which will make a decision on how much of a fine wynn resorts will pay because at this point the company has admitted to almost all of the allegations against it, which are pretty damning. it shows that the executives in many cases ignored the complaints that were brought to them by employees about steve wynn's behavior. so we're waiting on two things, one, how much will they pay, two, will there be any conditions placed on the gaming license. the control board has not suggested that >> i'm glad you clarified that because that is how a lot of news stories are framing this. so if there is not a major,

major fine, what actual punishment has there been if they won't do anything about the license? >> for one thing, look at the company. it is a very different company today than it was a year ago when the news first broke. you have a different ceo, the board is almost entirely different. you have new sets of procedures and protocols throughout that company. it is a far different company today than it was. and the next question is will the massachusetts gaming commission follow suit nevada has many more decades of -- >> seriously i mean two of these allegations were full-on sexual assaults what does it take for the neff they have gaming commission to just say we're not going to let you have a license i mean a fine? >> but the people who were in charge of that are no longer associated with the company. >> but there are actual executives who knew. >> the qvc has been there through and through. >> matt maddox has been there from the get-go and he was steve wynn's protege there have been questions about whether he had the seasoning

necessary to take over as ceo. >> and it just benefits the state of nevada without really punishing the company or -- >> but it would be the company that pays that fine. >> sure, but investors always say it is a one time hit, now we have clarity of the future >> and speaking of the future, they appointed three new independent directors to the board, all women, more than a third of the board is women. so the question is what happens going forward. and in massachusetts or mccaw on or wherever else let's talk about facetime, a flaw in apple's facetime app is raising questions. the bug could allow you to hear a person you're calling before they accept the call apple has temporarily disabled the group calling feature in facetime while it works on a fix for the bug. i tried it last night and you have to kind of dial yourself in anyway, plenty of team were doing this how big of a problem is this >> fortunately not a big problem because most people could figure out how to do it, they were able

to pull the feature remotely imagine if it had intoen on for we -- on for weeks or weeks. so apple dodged a bullet >> but the fact that the flaw was able to exist for a company like ap ple, and this is an issu of security which they are supposed to be the one company that you can trust >> remember all the ios updates that broke people's phones in a way this is worse because it is your privacy at stake, but in a way it is not as bad because you had thousands and thousands of people's phones actually getting bricked when that was a problem here you just have a couple of anecdotes of here is what could have happened. >> what was the brick thing? >> you download the new operating system and it would freeze up the phone and you would have to take it up to the store or hook it up to the mac or try to get it fixed >> learned something let's talk about retailer kohl's and ww, formerly weight watchers they are teaming up as part of a new wellness initiative.

kohl's will open up a ww branned studio inside a chicago store and sell their merchandise in store and online i don't really understand how this will work >> don't you think it makes sense? one, if you can make your employees healthier, your health care costs go down >> is that what it is about? >> let me just propose this. two, if you can get people in buying now your wellness gear, your athleisure gear, then you are making customers out of the people going to weight watchers. and three if they lose weight, they are going back into buy whole new wardrobes. >> i think it is a great merging of two demographics. s average coal ekohl's customera woman when make s 100 k or more. and weight watchers is speer headed by oprah. >> and i used to be on weight watchers back when it was more of like a sign up and you'd count the points so i don't understand what physical place you need to go to for this and isn't there an element of

privacy? i mean other than the fact that i just broadcast it, i don't really want anyone to know > >> mindy grossman, ceo, she is going to wellness here so it is trying to take away the stigma, it is not just about losing weight, it is about getting adequate sleep and being able to meditate and really feeling good about yourself. she knows where her customer is. here is an executive who used to work at nike, hsn. she is putting herself right in that spot to be part of the conversation >> is weight watchers paying kohl's a bunch of money or are they not because for kohl's they are trying to get the -- i guess that is what it comes down to. maybe we'll learn more. not unrepresented, a column in the "new york times" business section is discussing hustle culture. at first i dismissed it because i didn't really understand it, but i'm told this is a real thing. it is the phenomenon of millennials working 18 hour days

and then boasting about it on social media hashtags like thank god it is money or rise an grind >> never heard rise and grind. >> this is silly con valley culture. i think in a way it is great just as long as you are realistic about it >> i get the entrepreneurial aspect of it, but -- >> you are on your own, don't expect your employer to give you anything long term you got to work for every scrap. >> i do love that, but i didn't know it was such a thing >> and it is no the just millennials. i'm a gen xer and my first job i worked 16 hours a day and i got the best advice ever my boss told me she said you may love this job, but this job does not love you back. and when you're 80 years old and you're on your death bed, this job won't be there to comfort you. and that's what millennials and anybody -- and then she was like get back to work

anyone saying #hustle should remember that. >> and if you watch uber commercials, you hear get your side hustle on so it is pretty common but millennials will have to work until they are 70 years old to retire as comfortably as people that are younger. >> all right thank you all. jon fortt, contessa brewer, frank holland. theresa may is gearing up to go back to brussels but the eu is pushing back. those details and the key role ireland plays is straight ahead. see that's funny, i thought you traded options. i'm not really a wall street guy. what's the hesitation? eh, it just feels too complicated, you know? well sure, at first, but jj can help you with that. jj, will you break it down for this gentleman? hey, ian. you know, at td ameritrade, we can walk you through your options trades step by step until you're comfortable. i could be up for that. that's taking options trading from wall st. to main st. hey guys, wanna play some pool? eh, i'm not really a pool guy. what's the hesitation? it's just complicated.

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>> reporter: the border has no customs checks, no security or passport lines, just freedom of movement for both goods and people since the republic of ireland and the united kick dyunited kih members of the european union, this dividing line is basically invisible. the dairy industry, these cows produce milk that is produced and checked at this facility also in the south. but much of this milk is then transported across the international border to be sold in northern ireland without any further testing required both the irish and british governments insisted after the brexit referendum that this kind of seamless cross border trade could continue even if this rural region became the eu's only land front tear with the uk. and 13 months ago early on in brexit negotiations, the brits

made a promise if a new trading arrangement with the eu was not finalized by december 2020, the border with ireland would remain invisible no matter what >> united kingdom gave the european union back in december a cast iron and bulletproof guarantee that there will be no hard border on the ireland of ireland, no physical infrastructure and no controls or checks. >> reporter: this is the eu's could he insurance policy. called the irish backstop. and if this backstop were to kick in, britain would be suck in the european customs union unless and until an alternative solution is found. that customs union would prevent britain from pursuing new trade deals outside europe and that is why so many pro brexit uk lawmakers refuse to support prime minister may's deal >> and so if britain ends up crashing out of the eu, does

that mean a hard border will go up >> reporter: well, that is a really difficult question to answer essentially both the british and irish governments have seemed to suggest that won't happen and we've had a bit of a controversy here last week whereby the european commission seemed to speculate that that was what would happen only to kind of row back from those comments and say both governments are still committed, the european commission is committed to avoiding that and this of course goes back to the good friday agreement 1998, something that both sides have said that they want to avoid. >> so on that point, the ira in derry had taken responsible for a car bombing that i believe was last week. and they are calling themselves the new ira. there is footage of what happened it was the middle of the night, so nobody was hurt but is this brexit enflaming that old tension and potentially risking more violence? >> reporter: this is something that former security officials

here in the uk have said is a very likely possibility. there have been reports just last week in a lot of the british newspapers that around a 50s of mi-5, the uk's domestic intelligence service, now has a personnel in northern ireland. so a 50s of thefifth of their pi northern ireland because those concerns and we've heard as a warning repeatedly that if hard infrastructure, if customs checks, if security checks are imposed necessarily on that border because the backstop is not implemented, there is concern that those will become targets. >> and it has been a difficult process, but not an incredibly important one. willem, thank you so much. shares of california utility company pg&e rallying today and it has filed for chapter 11 bankruptcy protection. the details and backlash from investors is next.

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aditi roy is outside headquarters with the latest >> it is finally official, pg&e-filing for bankruptcy and now that's happened, now what? it's likely they'll have about 120 days in order to come up with a reorganization plan we can expect creditors to identify themselves in coming days and weeks and also organize themselves into a committee. we'll also likely hear from other stakeholders like wildfire victims and regulators who have to approve any sort of rate hikes. all of these groups will likely weigh in on even contest pg&e's proposed organizatireorganizati, and the whole process can take likely months if not years as far as the equity shareholders, they include the following, blackron, van guard and t. rowe price, and all of this has been a big hedge fund play with baupost and d.e. shaw

and bluemountain most of the parties were made whole. it is unclear if that will continue to happen in this latest bankruptcy. back to you. >> and a break for consumers as a result of all of this. apple reporting earnings after the bell today up next, the key number toss watch for after its numbers on what q-1 might hold just four weeks ago. i love you. servicenow works for you. about medicare and 65, ysupplemental insurance. medicare is great, but it doesn't cover everything - only about 80% of your part b medicare costs, which means you may have to pay for the rest. that's where medicare supplement insurance comes in: to help pay for some of what medicare doesn't. learn how an aarp medicare supplement insurance plan, insured by united healthcare insurance company might be the right choice for you.

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apple is set to report after the bell tonight it's down about a percent since warning investors earlier this month that revenue from the holiday quarter would his estimates. a senior analyst covers the stock. and josh lipton, what is the market looking for this afternoon? >> so, i think a couple metrics, kelly. they did as you mentioned, preannounce q-1 results earlier this month so investors will make a bee line for the q-2 forecast the street thinks you'll see revenue of about $59 billion also this is a new kind of report we have a new methodology here so apple is no longer going to disclose some metrics like the number of iphones shipped in a quarter, but they are going to include some new performance metrics, for example, services margin now, so the street trying

to guess where that could come to i know ubs telling their clients the service margin probably comes in the low 60% range, which would be higher than the overall company. >> that's a pretty good number tony, what are your expectations, and is it possible for apple still to disappoint? could the trends in china have gotten that much worse, or is that unlikely? >> it's certainly possible, kelly. the key number i think is the revenue guidance number and expectations are around 59, but apple commented in its preannouncement that consumer demand sort of slowed throughout the quarter, and the big question is, well, if that was the case and they built too many iphones, they may have too much iphone inventory, which would potentially force them to guide lower than streets that's going to be the key number i think the other one is gross margin percentage. the street is looking for about 38%. those are the numbers folks will be focused on. >> tony, what have you made from

what we've heard from nvidia, some of the other chips, some of which were positive, ahmadinemdr the bell today are they bearing on apple at all or is there elsewhere to look in the smartphone segment for that? >> we know that overall smartphone demand has weakened, not only in china but globally this is the first year ever that total smartphone units will have declined and we're also seeing incremental competitive pressure so we're seeing that manifested throughout the supply chain, and that's part of the challenge for apple, is ultimately demand is slowing as consumers choose to hold onto their phones for longer and not upgrade as quickly. >> right and so we're left with not reporting unit sales even, tony. so what's the metric you will look for as an analyst >> it's really going to be iphone revenue trajectory, which we know for this quarter will be down about 15% year over year, but that's the metric we'll use, total iphone revenues and try to

impute average price from there. >> still going to try to cobble it together. >> absolutely. >> thank you both. stick around tonight for full coverage of apple's earnings report and conference call on "closing bell" and "fast money." that does it for "the exchange." i'll join melissa and bill on "power lunch" beginning now. >> i'm melissa lee with bill griffith just 24 hours from the first rate decision of 2019, plus the fed chair's news conference while the chances of recession are rising an earnings avalanche ahead, apple reporting after the bell, but the attention turning to its outlook. what the street is watching. and the range against the rich why howard schulz's potential 202 run is creating a big headache for business and the wealthy. "power lunch" starts right now >> and we do welcome you