>> i'm long the stock for a trade so i'm hoping. >> axp, american express some responsible exposure. finally these stocks are moving. we'll see what happens, though rob, thanks for being here thanks to everybody for watching "the exchange" with kelly evans begins right now >> thank you, scott. here's what's ahead this hour. the stock market clearing a key hurdle that could pave the way for a new rally. we'll reveal what that is and how to play it the debt piles on. the national debt hitting the highest level on record. it's not just the government that may be getting tapped out and privacy problems we talk a lot about facebook and google but is there another company that could be just as invasive we'll get into that a little later on we begin with the fadesing rally. dom chu here with those numbers. >> we were higher by more than double what we are now on the dow. up about 85 points, about 0.3% to the up side a similar percentage move in the

s&p 500. and the nasdaq up by about 0.1% as well. well off those best levels of the day. calling your attention to what's happening right now with the industrial sector. the single best performing sector year to date in the s&p 500. it's up around 16% or so, up about 24% since the lows we saw back on christmas eve. so a nice move higher driven in large part by boeing and also general electric the best performing s&p 500 industrial so far year to date and then the stock of the day so far, freeport-mcmoran, gold and copper those shares up by 6% here you can see a down trend over the course of the past year. analysts at morgan stanley say it's an overweight stock with a $14 price. copper prices are improving thanks to better demand from china coming up and lower production globally. kelly, back to you >> that's a good sign, dom welcome to "the exchange." i'm kelly evans. let's begin in washington where president trump just made

comments on the government shutdown and the trade talks with china eamon javers is live at the white house. >> the president speaking in the oval office alongside the president of colombia who is here for a visit internationally, the president was offered the opportunity to commit to signing that spending deal which is working its way through capitol hill, but the president not taking that option here's what he said. >> we haven't gotten it yet. we'll be getting it. we'll be looking for land mines because you could have that, you know it's been known to happen before to people. but we have not gotten it yet. it will be sent to us at some point and we'll take a very serious look at it i don't want to see a shutdown a shutdown would be a terrible thing. >> the president's talk of land mines there matches what you hear from officials at the white house privately that they're wary of anything that could be a poison pill or something like that buried deep in the text of the legislation. that said, you also don't get the sense in talking to officials here at the white house that the president objects

to anything that's been announced about this deal so far. that is he seems willing to sign it as long as there isn't anything in there that catches him by surprise. we'll have to wait and see with this president in particular, it can always come down to the very last minute and they're going to watch the reaction to the deal among conservative pundits who have outsized influence with the republican party base and this president's political base as well they'll be monitoring that as well as looking at the legislation. >> you can feel the markets trying to stay nimble down to the very last minute >> and the president trying to stay nimble. >> that's true eamon, thank you the consumer price index showed some firmness in core inflation. that index up 2.2% for the year stripping out energy and food. pricing pressures overall look muted. economists are saying that gives the fed room to be patient on rate hikes and this morning, we learned that levi is goingpublic again levi has been private since 1985 filed its paperwork for an ipo today. let's get down to the nyse with

seema modi who has more on this. >> that's right. the q4 earnings story is improving and it's not as negative as expected a lot of focus on the consumer discretionary sector which has seen a 15% jump in earnings growth this quarter. a handful of companies are referencing strength in the consumer heineken seeing strong volume growth driven by nonalcoholic products and hilton beating profit expectations as it increases room rates the question is whether the retailers set to report in coming weeks will see strength in the consumer. hilton at the top of the s&p 500 helping lift other hotel operators like marriott and hyatt set to report tonight. you heard dom talk about freeport-mcmoran not only we are poised to close at the highest levels since december but the s&p is moving

above its 200-day moving average. the percentage of stocks hitting new highs is the most since december 3rd and the qqqs. dom is back. let's also bring in bryce. let's sit and chew over what you think the message is from these markets as all of these positive signs now. >> it's incredible what a turn around from december when the economy was going to go over a cliff and the sky was falling and now this euphoria. we're up 70% from the low in december and the economy just doesn't pivot like that. it doesn't change that dramatically we think it's all due to the fed or 90% of this turn around is due to the fact that the stock market thinks they own the fed the fed can't do anything now. and is sidelined forever, which, frankly, has us a bit concerned.

that's a lot of overconfidence built into the stock market. >> to bryce's point, it's not as if the outlook for the u.s. economy got so dramatically divorce warrant the sell-off we saw in the fourth quarter. there's a couple of things going on >> there's a tug of war between bulls and bears because of that. and the v-shaped recovery out of the markets is probably indicative of why the entire action that happened october, november, december of last year was quote/unquote overdone the issue is whether you see those catalysts. bryce brings up the fed. one of the big headline catalysts of the year. the earnings season is just about over we're in the last stretch just about three-quarters of the s&p has reported earn,s growth is still good for the fourth quarter, but expectations have been coming down for first quarter you've heard earnings recession thrown about quite a bit it's probably a little too early to call an earnings recession. still as long as those concerns are there, you might see sentiment be a little more on the dampened side of things heading into this next quarter

>> are you guys long equities or how are you positioning for the rest of the year >> well, we still have plenty on the equity side of the business and the bond side of the business we're a little bit nervous, frankly we are looking at the fed continues to reduce the balance sheet. that takes out half a trillion worth of demand this year alone. even though they say the word flexible, they are really not changing that policy on top of that, the treasury is issuing another trillion dollars. so the government bond will get issued there will be demand for government bonds but where will that demand come from? it will pull money from stocks, from everywhere. so that's where it's going to get choppy i do agree with the earnings assessment that you just talked about, but this overriding headwind month after month $125 billion that's got to come from somewhere to feed this beast that's the government bond market >> and bryce, it's interesting

to hear the cautiousness you feel about owning bonds because people have gotten more comfortable. they've said interest rates just aren't going to go up that much anymore. we're happy to hang on to fixed income but you feel differently. >> we like the tips actually because tips -- tip bonds were up today when traditional treasuries were down even though this inflation report looked very mild. but the tips were building in and invasion rate of 1.8 there aren't any inflation measures that are that low so within the bond market, we do think treasury tips do offer a little bit more of an advantage right now. >> dom, still some hawkish people out there >> apparently we are going to grow and have higher prices. >> bryce, we'd like it if it comes from better growth thank you for joining us bryce doty and dom chu, appreciate it. the risk of another government shutdown has been grabbing the headlines the national debt is rising at unprecedented levels it just hit $22 trillion

and the deadline to raise the debt ceiling is fast approaching. will we hit it let's ask david wessel from the brookings institute. >> how much does the $22 trillion level we just crossed feed into the upcoming deadline. we are going to hurdle right into it? >> well, look, first of all, you have to watch these dollar numbers because the economy is getting bigger so i like to look at it as a percentage of gdp. the problem, it's also setting records as the percentage of gdp. the reason the debt ceiling is so awkward is it requires congress to do something and although there doesn't seem to be much appetite in congress to worry about the debt, they don't like to be -- see their hands on doing something to raise the debt ceiling we'll hit the debt ceiling or the debt ceiling returns in march. the treasury can do a lot of moving money around so it probably won't be a crisis until late summer. that's when they'll need an

increase to keep the government current on its obli gations, and it's likely to be one of those flash points but if recent history is any indication, they'll go right up to the edge. a lot of nervousness and noise and then raise the debt ceiling. >> did we miss a payment last time >> no. >> we got very, very close but never missed a payment >> no, not in recent times >> we'll see what happens this time around. let's talk about the deficit which is rising at the same time is that more of a structural issue? it ballooned back during the financial crisis and then started to narrow. when the cbo says we'll have trillion-dollar deficits in 2022 is that because even with stronger growth we still can't bring that level down? >> correct basically we have -- we had a big tax cut. it's adding to the deficit now that seems untimely given how strong the economy is. but actually the government, as your previous guest said, doesn't have any trouble raising all this money it's not a problem today the problem is, if you look ahead to the future, the

government has made promises to pay benefits, largely retirement and health benefits that exceed what the tax code will bring in. the debt and deficits continue to mount and at some point we have to do something about that. and it would be better to do it sooner than later most people think, but there's no political will but there is one interesting thing. as long as interest rates are so low, the urgency of reducing the debt really goes away. that's like economists have been making that point. so it really isn't an urgent problem today. it's an urgent problem tomorrow. we seem to do a very good job of avoiding problems we need to solve. >> you are a soft-hearted guy. what do you think of the fact that all of what you are citing comes at the time we're hearing from 2020 candidates these entitlements need to be expanded dramatically and not paired back >> it's a problem. we can't afford to keep making promises and not find a way to pay for them and a lot of this has to do with

the fact we're an aging society and health care costs go up faster than everything else. that's a real problem. it's not something that's going to go away so it is worrisome and the inability of the political candidates to kind of speak the truth to people is rather disturbing. we don't have some credit card that we can charge everything for the future and hope the chinese will continue to lend us money. >> then that's another -- a whole other topic. david, we'll get into that next time good to see you. david wessel from brookings. a news alert on google what's going on, josh? >> google is now saying it's going to spend $13 billion on u.s. real estate in 2019, expanding into nevada, ohio, texas and nebraska so money for data centers, office expansion in 2018, cap ex doubled to more than $25 billion though importantly the cfo did say that growth would moderate. when she talked to cnbc,

defended that investing saying they're investing mostly in technical infrastructure, data centers and machines but the headline here, google will spend $13 billion on u.s. real estate in 2019. kelly, back to you >> are they trolling amazon? are they getting any big incentive checks for these big warehouses, data centers >> not sure if they're trolling amazon just yet. haven't seen quite the roll out that we saw from amazon here for hq2. don't see it in the release but i'll get back to you if i hear more about any incentives like that >> they're being cited in the new york city area here's what's ahead on "the exchange." >> coming up -- a new suv. ramped up production and a bigger push into u.s. manufacturing. a look at how bmw is fighting back as threats of european auto tariffs grow the aggravated world of agriculture. why the industry, the workers

and equipmentmakers are starting to raise red flags and the former president of facebook says there's a new company violating your privacy more than facebook this is "the exchange. - i think the best company's succeed as a team

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autos and agriculture. two industries impacted by tariffs and trade uncertainty. let's take you to the front lines of both. phil lebeau is live in thermal, california jane wells is at the world ag expo bmw expanding its presence here to get ahead of tariffs on the eu potentially, right? >> and that's true, kelly. the folks at bmw are well aware the commerce department is close to wrapping up perhaps by the end of the weekend an investigation into whether or not european auto imports are a threat to the national security. that would be the basis for the trump administration potentially instituting higher tariffs and/or higher import costs on vehicles that are brought in from europe. so we asked the head of bmw north america how worried are you about the potential for new tariffs to be slapped on vehicles coming in from bmw in germany. here's what he had to say. >> am i concerned about it y y i am, because it will have an

impact if tariffs go up it's not good for the consumer or dealer network. >> bmw is ramping up its production of the suvs the bmws they sell here in the u.s. and really for most of the world, they're built in spartanburg, south carolina. the new bmw x7, its largest suv, that goes on sale next month along with two other models going into production in april that's the reason why bmw's assembly plant in spartanburg expects to have near record levels of production in 2019 likely over 400,000 vehicles and premium suvs we talked about this repeatedly. there's a market out there for suvs and premium vehicles. bring them together and this is why you see the growth in demand in premium suvs. shares of bmw, remember this, that report from the commerce department, most likely comes by the end of the weekend we'll see what the trump administration has to say based on what comes out of that

report >> it's a huge topic we can see that area would thrive as they're moving more business here. phil lebeau, thank you how about the world ag expo. let's get out to jane wells. what are you hearing >> we're about a year into this trade and tariff war so we're getting a real sense of the impact here in agriculture this is the largest farm show in the west these pieces of equipment cost a lot more because of the tariffs on imported steel. they're already expensive. this tractor is over $500,000. we're at the agco booth. they hope farmers want to buy this year even though the farm economy is weaker because there was a buying spree in 2013, 2014 and it's now time to get new equipment in a general cycle, farmers are being hurt by the chinese tariffs on their products being exported, but it's not all bad dairy exports may be down but since soybean exports are down, it's cheaper to feed their cattle >> some of the benefits have

been lower input costs as well because of lack of exports of soybean meal and corn. it's actually helped us on the input side >> and there's other things. for example, domestic garlic producers are having a great year because of the tariffs on chinese garlic coming into the country. and on the other hand, while fresh oranges out of california, the exports have plummeted 80% you missed out on the chinese lunar new year for you and me, that means lower prices at the grocery store. so it's good and bad >> i didn't know about the garlic jane, what you are saying is, and i'm curious, are people starting to stockpile now because they think tariffs might be going up again orring china might retaliate? how are they planning in this kind of environment? >> it's very difficult to plan especially in a state like california where you either have row crops where there's just kind of constant turnover or fruit and nut trees which those trees aren't going anywhere so you'll have almonds, oranges,

peaches. no matter what the trade situation is so -- and another big issue here, too, especially in california is the immigration situation because a lot of the crops here, as opposed to corn and soybeans in the midwest, have to be manually harvested, and immigration here, as always, remains a challenge. >> that's a great point. jane, good to see you. jane wells in california coming up -- do we need a digital detox? a look at the addictive nature of tech and who is to blame for it the people who developed the platforms or the people using them plus, america's unbanked steve liesman followed jerome powell down to mississippi to see how big this problem really is you don't want to miss it. "the exchange" is back in two. what do you see? we see a billion more people breathing free. we see access to fresh food being the global norm, not the exception. we see homes staying cooler,

without the planet getting warmer. at emerson, when issues become inspiration, focusing core strengths to create a better world isn't just a result, it's a responsibility. emerson. consider it solved.

become back. here are some of the movers this hour dish network is falling after profits came in lighter than expected there was a greater than expected loss in subscribers dish shares are down more than 8% trip adviser also moving lower after their earnings fell shy. unique hotel shoppers were down 11%. trip adviser shares down 6% today. and chipotle is in the green again. that's helping bill ackman his firm saying today it's up 24% this year helped by its bet on the restaurant chain. his chipotle stake is up 50%

since his initial purchase in chipotle over to sue herera for a news update. >> venezuelan president nicolas maduro calling president trump a white supremacist accusing him of undermining venezuela for his own ends he made the comments in a british tv interview in caracas. pope francis has written a letter to maduro indicating conditions aren't right for the vatican to step in and help mediate that country's political crisis an italian newspaper quoting from the letter which it said was written on february 7th, just a few days after maduro asked for the pope's help. a moscow court rejecting an appeal by a group of ukrainian sailors against the extension of their pretrial detention last month the court extended until april the detention of the eight sailors who were among the 24 captured by the russians in the black sea. and back at home, there may be a new drug available for

those who are battling depression they approved an experimental drug from johnson & johnson. it will be for patients who have not benefited from other anti-depressant treatments you are up to date that's the news update this hour kelly, back to you just about 30 minutes until "power lunch." i'm joined by melissa lee. >> auto loans, that's all the talk today, right? that's the story that came from the federal reserve data and i'm sure that you guys have talked about it, too the number of loans, at least 90 days past due are at a two-decade high. the implications are many. first of all, the implications on the auto sector if we reach peak auto and peak auto lending and that lending is already getting delinquent, what exposure do the automakers have to that because they do lend themselves we'll be talking to a couple of analysts on "power lunch" about that and also the impact on the economy. that may be the more interesting take on it >> i wrote about it in the newsletter today

>> "the exchange" newsletter >> i don't think melissa has signed up for that >> no, i will. i will sign up for it. we'll see you for "power lunch." and here's what's coming up on "the exchange. ahead -- heart health events in the most unlikely places. the proposal to pay you a data dividend yoga classes in a local pharmacy plus, whiskey and women. it's all ahead in rapid fire ing. you're right sir... everything. no not everything, i mean you're still blatantly sucking up to me gary. brilliantly observed, sir. always three steps ahead. six steps ahead. sixteen. so many steps. you done? a million steps ahead. servicenow. works for you.

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welcome back let's catch you up on a few stories. it's time for rapid fire here with their takes are bill griffeth, morgan brennan and robert frank first up, how about the report that smart watch sales surged 61% in november year on year that's nearly $5 billion worth of sales apple is the clear market leader speaking of which, apple hosted a heart health event at one of its stores that included a walk around the block with the apple watch. >> you talk to tim cook about the apple watch and all he wants to talk about now are the health benefits i went back and looked it was introduced in 2015. and i had forgotten they even

mentioned it had a heart sensor. you can monitor your heartbeat but now they're talking about maybe diagnosing atrial fibrillation they're really -- >> partnering with j&j on that, i think? >> deep into the health care part >> we know your history with the fitbit >> i am wearing nothing right now. my wife has the latest version of the apple watch and she likes it you know, for the health portion of it. >> the risk might be that people might think it could prevent a heart attack or detect a faulty heart and it's about the electrical impulses in the body. the risk is people take these and think it doesn't show a problem. therefore, i'm super healthy it's going to take some time to figure out the benefits. those outweigh the cost. apple needsc caveats of what it meant measure. you still need to go to the doctor >> that's why god created the fda. that's their job to make sure

that happens >> i think you have this convergence of health care and tech in two meaningful ways. you have health care companies that are adopting more tech. something kaiser permanenty's ceo talked about the digitizatiodigitization you have these big tech companies like apple that are getting into health care because they see this as the next big place they can grow their revenues jim cramer talked to tim cook last month and one of the things he said was he expects the bigger contribution by mankind to be the health contributions >> your cvs store could soon get a makeover they're unveiling three now health hub concepts in stores in houston with more space dedicated to pharmacies, health care, even yoga classes. this comes as cvs integrates aetna and is girearing up for a pharmacy battle. >> i think it's almost like they

become this one-stop shop in terms of products and services it almost reminds me of the way home depot is for household appliances and things involving construction and the house and the like it's like cvs is becoming that retailer for health care >> more of a store feel to it. easy in, easy out. not this big elaborate doctor's office >> you have to say what this service is and what it isn't it's not primary care. >> yeah. >> and it's not emergency room care so what is it? >> blood pressure tests and flu shots and -- >> some of the cursory things you can do they already do vaccines but now they want to do a wellness center. >> it's part of the whole insurance push toward preventative and maintenance i am already -- these drug stores are already so depressing to go into that to have another reason not to go into one where i'm going to be reminded my diet is not great, i'm not getting tested for this. >> candy and cigarettes.

>> i'm not taking another yoga class. >> you can take yoga in one of these health hubs. >> i get that enough from my own doctor >> exactly >> they'll not have robert frank as a customer just yet a new note from bank of america/merrill lynch downgrading deere from buy to neutral. but highlighting the fact that they -- deere is still dominating caterpillar outperformed by more than 30 percentage points. can you explain this one that's shocking. >> historically speaking, deere and caterpillar, the stocks, have been correlated in terms of how they trade the fact we've seen this over the past year is noteworthy. we've got this downgraduate from b of a today and the argument they are making is lack of apparent progress between washington and beijing weaker demand for construction equipment. it's a valuation story they think this stock is going to come down based on the earnings we're supposed to get later this week.

>> is deere as opposed to china as caterpillar is? two stocks became the poster children for the tariff battle that was boeing and caterpillar. and when the talks were going well, caterpillar would go up. when they were going badly, it would go down. we never talked about deere. >> they're exposed selling construction equipment, agricultural equipment exposed directly and incorrectly. >> that's what makes this so fascinating. >> and it reminds me of what jane was talking about, too. there's been some benefit to the farming sector from all of this. it's been years since they've had a real upgrade cycle >> we've seen both of these stocks and caterpillar, in the last couple of years, you've seen both of these stocks run up they're cyclical the people using these machines need to buy new machines >> it's a good sign. california's new gf proposing a data dividend.

newsom arguing tech companies make billions from collecting and curating our data and consumers should be able to share in the wealth. i find the roll out of the concept a little confusing >> i read the legislation. and it's not so much that they have to pay for your data. they are authorized to pay you if you want it now what i would love, rather than getting paid for the stuff is to opt out and pay for it myself i would like a facebook, a twitter -- >> you want to pay to opt out? >> i would prefer to pay a little bit -- >> for them not using your dauta. >> not have data and not have advertising targeted at me but it's just the service for what i want it for and not using my stuff. >> so google is just a search engine for you >> they must be making so much money off all of us that it's prohibitive to charge that because it would be too much >> the other point, too, which was highlighted this morning is you go back to work that william are nothouse did 15 years ago where he said in this case, the benefits flow so much more to

the users of this technology than to the producers. even the billions that we're talking about that the producers get, the consumer benefit, and you can ask anybody up and down. it's been tremendous, even if it comes with privacy issues. >> i get what he's trying to do, the governor, but it's getting to be late in the game on this one. how long have we been using this technology >> this will be the new wave of where this discussion is going >> i get that, but are we all grandfathered in on this and how much are they going to pay us? >> you want it retroactive >> the devil is in the details i get the concept but how are you going to enforce all of this that's the other thing >> that's why this is one to watch because california, as we've seen with so many regulations across so many industries over the decades. as goes california so goes eventually the rest of the country. if this were to move forward, this is one to watch closely we have to talk about the maker of jamieson whiskey and

beefeater gin has brewed up a new demographic, and it's women. the world's second biggest spirit producer is reporting that 50% of its u.s. sales from glenlivet founders scotch whiskey came from women. it made the taste -- >> i was just going to say, did you hear that part that's what red flagged for me they are making it more attractive to women by simplifying the label? my daughter is going to be all over that one when she hears that years and years ago, a former president of cnbc took a group of us out to dinner one night. he and i are sitting at the bar waiting for the others to show up we ordered our drinks. and i ordered a manhattan. stay with me here. and he says to me, you know, bill, back in the '40s, that was considered a ladies drink. it was the cosmo of its time so this is not something new,

necessarily, but it is -- >> because it had fruit? >> well, it could be a sweet drink. >> today's whiskey drinker is young, pierced and female. and it's kind of whiskey is becoming the hipster drink and whiskey, ryes and scotches it's not surprising they're having success here. the idea they had to make it sweeter, simplify the label. >> i love that what is that >> whiskey, alcohol. >> well, i'm getting the impression that -- >> do you drink whiskey? >> i have had it before. and i mean, i remember almost shrieking from the taste of it and i just -- it's not something i can do every day >> do you drink it >> at this point in my life, i don't drink anything but i used to drink whiskey clearly there's something going on because you had the whole jane walker roll-out last year this move to get more women to whiskey, which has more calories than wine. >> but no one is looking maybe if they simplify the label. >> my doctor is telling me, it's

got more calories than wine. >> does he >> he does >> thank you all i have learned a lot today coming up -- fed chair jay powell made an historic trip to mississippi yesterday shining a spotlight on america's unbanked. steve liesman trelaved to the delta to see for himself he'll join us next put your data to work on the cloud that drives business. the ibm cloud. the cloud for smarter business. the ibm cloud. ♪ ♪ our new, hot, fresh breakfast will get you the readiest. (buzzer sound) holiday inn express. be the readiest.

welcome back to "the exchange." nationally it's estimated that 1 in 4 americans either has no banking services or very limited access to them there are few places where this problem is more acute than the mississippi delta. our senior economics reporter steve liesman filed this report on the unbanked from the delta >> reporter: two fires in her homes in the mississippi delta left her destitute and in bankruptcy >> we have to pray because i didn't want to lose another

home and one of my girls said, mom, it's going to be all right god got us that this, too shall pass >> reporter: and along, literally, came hope a credit union focused on economically distressed areas in the south that brings basic banking services to the nation's poorest. >> the rate of poverty here is three times what you see in the nation as a whole. even greater for the region's african-american residents if you look at the level of banking services, three times the level of people who don't have a banking account >> reporter: tuesday the fed chairman jerome powell made a trip to the delta. attending a conference with investment bankers and community activists to shine a national spotlight on the problem of the unbanked >> cease to safe and affordable financial services is vital, especially among families with limited wealth >> reporter: the financial counseling provided by hope means she should be out of bankruptcy by november >> once i get out of bankruptcy, i know that it may not be the fattest account, but i'm looking

to have enough money in hope me and my girls will still make it >> reporter: kelly, losses on these loans are not a lot different from regular commercial banks they're just a lot more labor intensive to underwrite. so they use things like cable bills and utilities to establish credit history for the borrowers. >> i'm wondering, there's news separately that google is going to unveil maybe a much lower cost smartphone. what is it like down there for smartphone access, for home broadband even my point being if more banking is done on your phone going forward, could that help these traditionally unbanked and underbanked areas get more access to those areas? >> i have to give you a qualified yes and no yes, it could help because there aren't the branches. on the other hand, as you heard when i talked about the losses on these loans, they require sort of the manual underwriting. they have to know the people that they are underwriting and giving these loans to. so what they need more than the app is the branch.

and what's been happening because of technology and also because of bank consolidation, the branches are closing down and hope is opening branches in a lot of these places but not nearly as much as has been lost with the closing of these branches losing these community relationship >> it's great reporting. steve liesman joining us from mississippi today. small business optimism is at the lowest levels since the weeks leading up to the 2016 election but that's not the whole story we'll go behind the numbers and see what they're seeing that others may not see, after this -i call it my comfortable future plan.

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♪ [ ding ] show me fish on youtube. say it and see it with the x1voice remote. from netflix, prime video,youtube and even movie tickets. just say get "dragon tickets". small business owners are getting a bit more nervous about the economy. that's according to the nfib optimism index the reading slipped about three points in january to the low of the level since before the 2016 election so what's stressing out small biz? let's ask juanita dugan and our own kate rogers who is an expert on the topic welcome to you both. when we see optimism slide like this, does it -- can it pivot and turn around and make a comeback, or no? >> it has before, but i think the most interesting thing about the nfib's optimism index this

month is that it is the first time we were able to capture sentiment about the government shutdown and it's very clear that the optimism index has dropped because of the government shutdown we see a correlation when we have something called the uncertainty index. when our members are responding to the survey, they usually say yes or no to a question like are you planning to expand when they start to say i don't know, we know that they are having a high degree of uncertainty about policy they are very, very -- they are very responsive to government policy this was definitely the shutdown >> that's fascinating, kate. shutdown didn't have to happen we might be heading into another one in a couple of days or not the fact it could hurt sentiment that broadly it's not a sign of a recession, per se it's kind of a one-off event >> the nfib did point out small business owners feel their current operations are strong

but the future looks a bit uncertain. if you look at the declines, the biggest drop was in those who expect the economy to improve and real sales to be higher and those plans to increaseinventory that signals they're a bit uncertain about what's to come, but right now, things are okay we had our own data this week. came out on monday and we heard from our own polling that there were some concerns about a recession, but they've said that's not quite what they're hearing from their membership. >> so based on what you're say, if we don't have another shutdown, we should see optimism rebound, right >> we have no reason to believe that it will drop. this optimism index has been operating in a very, very high historic levels. since the day after the election in 2016. and even though it's jumped around a little bit, it's still been very, very historic levels. so this was really dramatic for a one month jump and it doesn't

necessarily independeicate thate rest of the economy is headed for a downturn as kate just mentioned, half of our index is composed of questions that are about current business operations. the other half are questions about the future what you expect in six months. so the questions we were asking about current business operations, those things are strong stichlt we're seeing strong hiring plans. strong inventories and capital expenditure, but what continues now which is a problem for the small business owner is they can't find qualified workers or they don't have applicants for workers for jobs r that are open this continues to be their single most important business problem and if you lingered on, the 35-day government shutdown, it really shook their confidence quite a bit. >> so finally, you mentioneded how high it's been since president trump was elected a couple of years back did this index need to come back down so to speak was there a honeymoon period built into that or based on his

policieses, are we going to see it remain higher. >> good question i keep wondering how long it can stay up there. it's at these historic levels for a period of time that's just unprecedented. so you have to think it will come to come down to earth, but that's not what we're seeing i think if the return to gridlock doesn't become the norm, gridlock you know is bad for small business if they can get back to having some consensus about just basic things like keeping the government open, i think we'll be polling about business operations >> absolutely. well it's very closely followed. thanks for the explainer thank you so much. >> thanks for having me. zblnc coming up, sean parker says facebook was designed to be addictive. is tech the new tobacco? next ow an index, but which ones target your goals? it's not about quantity. it's about quality. no trendy stuff.

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ed that way. he says he's more worried these days about amazon. >> i worry more about companies like amazon because they're, they're doing you know k facebook is something you use actively instagram is something you use actively you're choosing to post content and you understand that ads may be targeted based on the content you post and so forth. amazon alexa is listening to everything you say if you're having a conversation in front of an alexa device, amazon isn't guaranteeing you privacy. >> let's bring in kurt wagner. great to see you is he right that alexa is listening to everything people say? >> well, alexa has the ability to it's not supposed to start listening until you prompt it with the hey alexa reference but i think that's the big concern. we've seen with google and facebook and others with these in home devices is how secure

are they they have to be listening to that keyword >> we know it's not like these things have been rolled out. it's been years they've been this people's homes. we've had incident after incident where something is sent to authorities or it's triggered when it shouldn't have been. doesn't that tell us it's not only when you say hey alexa that you're being listened to >> they have to know when you say it they are listening for that keyword, therefore they must be listening to other things. what do they do with that stuff? is it saved on to a server, they say no, that's not the case, but this is still new. only a couple of years old that we've had these devices in our homes. people get comfortable when they don't think something is listening. >> you're such a savvy guy on this suf i'm sure your friends have a lot of knowledge do you have these devices or what do people say when these

comes up do you think people are crazy for putting these in their home or do you have five of them? >> i do not have any i tested the facebook portal in fall and found it to be useful for video calls, but when it was not in use, when i wasn't talking to my parents or siblings, i unplugged it i didn't want it sitting in my living room potentially listening the stuff. a personal choice, but i don't have a lot of friends in my group that are necessarily using these devices over every day >> is there any way earlier robert frank mentioned he'd love the option to opt out of data collection from a lot of these tech companies can we trust that amazon will develop something like this over time in response to privacy concerns or is i just built into the nature of the device >> i think the key is it provides a service that feels so useful to people they might be more comfortable with the data trade off. you're using amazon to do all your shopping.

your entertainment at home using amazon prime so i think that the more you get from amazon, the less you're worry ied about what you're givg and i think that they are in a unique position you get a lot with amazon. so i'm not sure what their motivation is now to have a huge strict data privacy thing because i don't see a lot of people complaining about it. >> what happens going back to the facebook issue more people say it's like cigarettes what does that mean to you. >> that we are getting addicted and still a lot of, i don't think, i think there is confusion over exactly what this means for long-term health for people if i open my facebook app 20 times a day, what does that mean we probably won't know for a long time if that impacts me 20 years down the road. it's clear these services are built to get you to open them and click them they taylor the feed so it's what you want to see every time. but there's still a lot of questions about the long-term health here.

>> and years to go in this debate like robert frost. >> we'll be talking about it for a lopg time. before we go, a quick programming note leslie picker will sit down with saved solomon at 3:15 for an exclusive interview on closing bell stay tuned for that and "power lunch" with tyler and melissa. i'll join them in a minute it begins right now. >> see you shortly, kelly. new at 2:00, confusion in washington but optimism on wall street. lt are the bulls getting ahead of themselves investing in the next tesla why amazon may shifting gears and this one stock is up 300% in 20 is the. how much higher it may go. "power lunch" starts right now >> welcome to "power lunch." stocks are up.