certainly not a long-term solution. >> frank, i love those cables. good to see you. there they are yes. frank hollande in columbus, ohio i'll join tyler for "power lunch" which begins right now. >> thank you very much we'll see you in just a moment or two welcome everybody. i'm tyler mathisen new at 2:00 for a tuesday. rebound on the street after monday's major sell-off. is it safe to tiptoe back in we'll debate that one. plus, the president defends his fight with china calling it a little squabble. he also says it would be game over if only the fed would cut interest rates we'll discuss that one and facebook facing now 20 years of oversight as part of the settlement over its privacy policies what that could mean for the social media giant and investors. "power lunch" starts right now

>> let's get a check on this rally tuesday. we're around session highs right now, but today's gains, not enough by far to make up for yesterday's big losses still the dow, posting the biggest gain since early may for the s&p 500. still in early may going fast and there's the nasdaq up more than 1.6% small caps, they still, kelly r in correction territory. >> we've been pointing out several retailers and tariffs a problem for the retailers but they've been down recently it's imported from china

additional tariffs and we believe that consumers could experience price increases by as much as 10% to 15% across all the impacted categories and this is assuming the retailers are able to pass the higher costs along. that's not clear at all. it's another problem, i didn't think about this but many retailers have private brands and those private brands tend to rely more on imports from china than other brands. private brands including aeropostale, and jcpenney and kohl's back to you. president trump putting a positive spin on the trade tensions with china calling it, quote, a little squabble, and key members of the administration have been very vocal in the last few weeks that a deal with china was coming soon

>> we had very productive meetings. >> a lot of progress. >> making great headway. >> our hope is that we are in the final weeks of an agreement. >> i think we're pleased with the progress. >> very productive >> i think it will be a very strong day, frankly, but we'll see. >> they were constructive discussions between both parties. >> constructive, productive. let's bring in our eamon javers from the white house where he got to speak with the president earlier today. eamon? >> reporter: that's right, tyler. despite all that constructive dialogue and progress you heard administration officials talk about in that clip, we haven't gotten to the point where we've got a trade deal the president, today, placing the blame for that squarely on the chinese side here's what he said. >> we can't just make a good deal and i told that to president xi but we had a deal that was very close and then they broke it. they really did. i mean, more than just renegotiate. they really broke it so we can't have that happen. >> reporter: the president ultimately saying he likes the

position that the united states is in economically right now and he was asked if we're winning the trade war and he said yes, we're always winning, tyler. >> thank you very much eamon javers on the north wall. >> in the meantime, president trump again putting pressure on the fed in a tweet today said cha china pumping money into their system and making up for the business they're losing. if the federal reserve ever did a match, it would be game over for china. steve liesman joins us now with whether the latest tensions are putting more pressure on the fed. >> like a charity contribution, a match. tariffs are really presenting the fed with several important dilemmas for one, they call the economic outlook and make the path of policy more uncertain. it's unclear if tariffs push up inflation with higher prices and possibly push down prices through weaker u.s. and global growth and could be stagflation, weaken at the same time. the fed will respond to the

tariffs at least while a deal is renegotiated ian said the fed cannot pounce on every wobble as though it's an existential threat. policy makers would not want to reverse a premature rate cut if a subsequent trade deal then triggered a huge rebound kansas city's esther george will wait and see if our monetary policy needs to respond. that has been a consistent course from the committee. on its own, would not cut rates because china with the economy and stronger dollar with major currencies could import more deflation from abroad and rate cuts along with weaker growth. but many other factors would have to fall into place for that to happen. not just in response to a matching rate cut. >> where are we on the odds for a rate cut right now >> the market has no dilemma on this issue the market is convinced the fed is going to cut and cut soon here's your probabilities. those are up in the wake of the tariff announcements by the

president. 52% probably have a rate cut by september, all the way up to 57% near certainty by january. i think the market is a little bit ahead of itself and not going to question these guys with the money on the line >> very interesting. so the market's basically seeing a slowdown >> market sees a slowdown and the market sees a fed response i think the market is definitely wrong if it thinks the fed is going to preemptively cut in response to the tariffs. i believe the fed -- the monetary authority will not align itself with the fiscal authority ahead of time. i believe what the fed will do is if the data starts to go bad because of this, then the fed will respond. >> thank you, steve. jim cramer saw the rally and saw it last week he raised the big question for investors on mad money and he did it last night. >> can you start buying stocks yet? last week i told you that tuesday would be the moment to start doing some buying. i figured this chinese retaliation would scare people today and the recession stocks

would win. that's the stuff like hershey's, campbell's that's all right but by the end of tomorrow's session, investors will probably start picking up among the rubble with well-run domestic names like the manager care stocks, the telcos and some t . techs. >> tech is the best performing sector today and didn't wait until the end of the session to buy. they're buying right now or more pain ahead he just cut his risk response because of escalating trade tensions and michael farr from farr, miller and washington. he's there too welcome. good to have you how much and where >> thanks for having me, tyler we cut our risk allocation by about 3% or 4%

we were overecho on equities a neutral on equities. when we cut our allocation last week and look at the way the trade talks faltered, and a euphemism for collapsed in this situation. no one saw this coming if we look forward given the fact the chinese don't seem to have a lot of interest right now in meeting us even halfway, much less further than halfway, we have a potential very serious overhang on the economy in the form of not just the tariffs on the 20, increasing 10% to 25% but the additional $325 million and there's no question about it the tariffs are hurting the u.s. more than china right now. >> so, and yet, if you see that kind of scenario, tony, you only cut it to what you call a neutral position on equities explain to me what neutral means in terms of what i can put numbers on 60% equities 40%?

what is it >> neutral is basically long-term investors, mention trust. a portfolio 60% equities and the reason it's only down to 60% and not simply lower than that, it's because we have to recognize the fact that the president has the ability to change the narrative. if he decides for political reasons, the economy is going to weaken significantly, to imperil his reelection, we think is a near certainty if we don't get a deal done and move forward with the additional tariffs, he can move back into the fray and negotiate what would be considered to be let's call it a bad deal a bad deal in the sense that it doesn't get what the u.s. wants but nonetheless, a good deal for markets because any deal is a good deal for markets. and so we don't know from an organic standpoint, we know from an organic standpoint the u.s. economy is doing quite well, but we don't know what he's going to do and we can't control that

so right now, there's just so much uncertainty neutral is the best place to be. >> michael farr with these talks going the way they are, do you think we're more likely to have any kind of deal even if it's not the best the u.s. might have wanted, in the next month or two, still come to that conclusion or is that in doubt for you right no >> i think we've seen that we can push the go-line forward whenever we need to. so, you know, the go-line is moving and we'll find out whether they really mean a month or two months or some time in the fall that narrative is changing you know, i listen to what jim said and i'm not smart as jim or tony to figure out what i need to be doing right now. i have a much longer view and trying to respond, i think, kelly, to these sort of short-term moves in the markets could really keep you very busy and not all that productive or at least from my perspective so i think you have to look a little bit longer term and

recognize that a lot of what we're hearing is just noise. not to mention a shift from depending on every utterance out of the fed and depending on every tweet from the president with how the trade talks are going. >> looking past that, michael, i absolutely take your point then. do you just stand pat and see any opportunities in the sell-off here or can you not make any moves until you have clarity on this outcome? >> we're making moves all the time and if you're waiting for clarity from washington or the federal reserve, i think you're going to be waiting a very long time we had a 25% run-off from the lows in december i think that if you're a disciplined portfolio manager, you're probably assessing your positions and probably taking some profits you're also trying to re-deploy into some things that haven't been working as well value stocks haven't been working well the beginning of the year, pg was probably not on the hot list but yet up 20% year-to-date and holding up well on this sort of turmoil. so you prepare your portfolio

ahead of time. i think we're doing that every day. i wish we'd see more of a pullback because i've got some stuff i'd like to buy, but, you know, 4.5% from the peak down to where we were on the low yesterday, even the bounceback today, not enough to give me an opportunity. >> michael, thank you very much. great to see you tony roth, thank you as well. >> thanks. >> you bet coming up, facebook may be on the verge of a major deal with the government to settle privacy issues it could be 20 years of oversight. is that a good deal to prevent a break-up plus, chips are rallying today broadcom, a&d, should you trust the rally or just one china headline from heading right back down "power lchwi brit ckun" lle gh 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?

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welcome back facebook is reportedly facing 20 years of oversight as part of an agreement with the u.s. government it would resolve recent investigations into some of the privacy lapses facebook shares slightly higher today and up more than 30% this year with us now to lay out what it would mean for the economy, for investors and for mark zuckerberg, kara swisher, executive editor and gene munster of luke ventures kara, would this be unprecedented with a 20 year deal with the government >> you know, whatever. the same thing with the fine these are all very high fines

and $5 billion is a lot of money and i wouldn't use the term unprecedented. it's just a question of how much they're going to actually monitor the company. they could have 50 years if they wanted if they're not doing their jobs like last time it doesn't really matter. >> my question is, is the government even prepared or have the experience, the wherewithal to handle something like this or figuring it out as we go and to your point, how do we know this is the right approach? >> it sounds unprecedented, but that's a small amount of money for facebook to pay. if it's $5 billion and what is this monitoring? who's going to do it what are the fines if they do something wrong? i'd love to know the details of something like this, just the number is just meaningless as far as i'm concerned. >> right, and gene, i would think from an investor's point of view, anything that's a 20 year deal with the government sounds bullish i mean, the worst case scenario for facebook is it getting broken up. i'd like to know what you think about this and the best case scenario is a

20 year deal with the government that sounds like a 20 year deal to guarantee facebook a position of power >> so kelly, i think exactly, the worst case scenario is a break-up and i want to put some parameters around there that's to focus on that i think this is more of a fairytale if this ever happened and the reason is actually breaking up facebook isn't going to solve what the key problems are on data or the news feed or tech addiction there are ways that the government can step in and, for example, add breaks to the product. quickly talk about this tech addiction piece of this. this endless scroll piece, something that gets people hooked in. they could add stops into that and ways the government can basically change and slightly alter facebook without breaking up the company i don't think that really achieves anything. i agree with kara, the question is how much will the government actually make good on change

>> i'll come back the you, kara, with a dumb question what is facebook's crime and what is the remedy that would redress the crime or fix whatever it is that facebook does that they are, quote, guilty of? >> it's not a crime, necessarily. they promised back in 2011 not to do these privacy violations and it's done a lot of violations since then. it was clear how they should behave and look at any number of things that's happened, including one today where wha s what'sapp had some problems with people hacking it and are they monitoring correctly the federal government wasn't monitoring and this is why we're here right now with the ftc. >> is a break-up the only way to remedy that or could there be other remedies like those that were applied in the case of microsoft and others >> well, you know, break-up is not going to happen.

it doesn't matter. we can talk about it all we want, there's lots of ways there's fines, monitoring, there's regulatory action. there's anti-trust lawsuits that could happen there's lots of different ways to handle all the different problems that all of these tech companies have and none of them have the same answer and i think the problem we have here is that fa facebook and google control much of digital advertising should they be able to marry the platforms with the advertising business and the privacy implications, who should monitor that or what about the idea they control all communications do they? or is the market that big? i think it's a very complicated question and each of these problems has to be dealt with in a different way. breaking up sounds sexy. we're going to break em up it's not going to happen people talk about it just to give you an idea of how people feel about tech companies and the power they have. >> i think that explain why is the shares are still up 30% this year guys, i want to turn to uber

we heard from mark cuban a short time ago he told the halftime report what he thought about the ipo so far. take a listen. >> i mean, it's not a surprise it's not a growth company. it's a brand, you know, it's an 8-year-old company, 9-year-old company. they just waited too long and there's nothing exciting about it maybe they'll introduce something new. maybe ubereats will explode and the numbers will show something incredible but i don't think you could have expected anything different. >> i think he's right about that did they just wait too long? >> that was one of the issues when to take it public and this group of internet companies right now have not gone public airbnb can they get traction? the businesses right now is incredibly challenging it loses a lot of money and they have a lot of competition and issues with drivers and so, if you're an investor, you've got to bewarely of these things and if you don't see a great growth opportunity, this is what you've

got. this is why the stock is lagging so much. >> gene, would you be a buyer here now that we're down as much as we are since the ipo? >> no, i think both lyft and uber, you kind of stay away in 2019 for all that unknowns, just in terms of what the investment piece is going to be and keep in mind that the core business that they're going to be in the future for this really to work, they need to have this autonomous piece working and removing drivers whether it's in the logistics piece or humans. so this is a major shift that's going to go on with these companies and i think that the smart money probably sits tight. if you happen to have the luxury of being able to own something for five years, i do think these companies will be worth a lot more in that period but i don't think there's any urgency to own these. >> thank you both. appreciate it. >> thank you. coming up, two sectors caught in the trade war. first, chip stocks bouncing back today but can they really hold up as this rally drags on

or is this a trade spat drags on and we'll talk to the ceo of clayton homes about the chinese gets hit with tariffs. "power lunch" will be right back ealth. make sure you're working with a wealth manager who can grow with you. cfa charterholders have the investment expertise to unlock opportunities other advisors might not see. learn what a cfa charterholdr can do for you at therightquestion.org tthis is where i trades. and manage my portfolio. since i added futures, i have access to the oil markets. and gold markets. ok. i'm plugged into equities. trade confirmed. and i have global access 24/7. meaning, i can do what i need to do.

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welcome back to "power lunch. i'm michael santoli at the new york stock exchange. chip stocks making a comeback today on track to break their longest losing streak since october. so should you trust this bounce? ari wald, your "trading nation" team today so ariya, i guess a little bit of an example with the faster they fall, the harder they bounce today but can you believe in this move >> i think so. you know, mike, aside from additional what could be near term stabilization, we think the group is tactically attractive for long-term purchase the semi-conductor, the overbought conditions. it was seen at its april peak. correcting into a prior breakout point from 2018 resistance typically, former resistance becomes support. we think this is where it stabilizes we think it becomes more compelling if we buy the leadership in the group.

that's your abgo here's a stock that made a higher low while the rest of the market was in free fall in december it broke out ahead of the market you could see the 200 day starting to turn higher. former resistance at 285 now support this is the stock to own, broadcom. >> gina, a lot goes into making an assessment of this sector obviously, whether it is the china trade frictions, the state of the semiconductor, how do you boil it down as an investment case >> so we'll start from the frictional stuff right now and go to the long-term stuff. obviously, exposure to china is, i think, what's driving the markets but if you look at how the stocks are traded, look at qualcomm, traded roughly down at the same as taiwan semi, yet taiwan sell mmi, little exposuro qualcomm to you have to think about that. but if you go out farther, the semis cycle already starting to

bottom out and we're expecting to see a second half bounce with the semiconductor and the really big broad, macro machine learning and 5g pushing this so i think that the long-term outlook for semis, still looks positive short-term, i think be careful about how much exposure you have directly to china sales and revenues >> yeah, i guess the semiconductor intensity of the economy is not going down anytime soon at least. gina and ari, thank you very much for more "trading nation," head to our web site or follow us on twitter at @tradingnation. big pharma under fire. the generic drug industry about the pricing conspiracy. buffet's big bet on housing. ceo of clayton homes with the impact of tariffs and ohs noes

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hello, i'm sue herera. here's your cnbc update this hour president trump talking to white house reporters on the white house lawn, before leaving to louisiana. the pentagon has a plan for iran to send 120,000 u.s. forces to the middle east. >> i think it's fake news, okay. would i do that? absolutely but we have not plans for that hopefully we're not going to have to plan for that and if we did that, we'd send a hell of a lot more troops than that.

>> in australia, at least 13 green peace activists after they lowered themselves off of sydney's harbor bridge calling to declare a climate emergency. prince harry visiting a children's hospital in england where he received a teddy bear for his newborn son archie he was shown around the hospital he met with children receiving medical treatment as well. you are up to date that's the news update this hour back to you, kelly. >> you caught my attention with that prince harry in the hospital i was like, what happened? >> i know, right no, it's a happy story all good >> sue, thanks about 90 minutes until the closing bell markets near session highs dow up 633 up 333 right now 1% gains for blue chips and s&p 500 and up 1.6% for nasdaq retail rallying but more than 80% of the stocks in the big retail etf, xrt, are worse down

10% or more from recent highs, etf down from may 3rd. oil market closing for the day and leslie picker at the cnbc commodity desk >> crude prices rebounding, claws back after the trade fueled sell-off. wti up more than a percentage point. as is ice brent. up and heightening concerns after the two were struck off the coast of the united arab emirates gas names in particular having a strong session heading for their best day of trading in over three weeks. tyler? >> leslie, thank you very much generic drug makers bouncing back after steep declines yesterday and the industry is firing back over accusations of price fixing meg tirrell joining us with the details.

hi, meg. >> makers of generic drugs lost billions of dollars in market value yesterday on the heels of a lawsuit more than 40 states alenling collusion and pri alleging collusion and price fixing, citing more than 1,000%. the company denied wrongdoing. the investigation ongoing and spoke with "60 minutes" on sunday about the suit. >> i think what we've come upon is that the generic drug industry is the largest private sector corporate cartel in history. >> the industry trade group association for accessible medicines point out that generic drug prices actually decline over the last three years. the lawsuit mainly focuses on activity from 2013 to 2015 joining us now to respond, the president and ceo of the association for accessible medicines, chip davis, in an exclusive interview. chip, thanks for being here. >> thank you for having me, meg. appreciate it. >> looking at the responses in the stock prices of some of these companies yesterday,

hearing from investors and traders in the space calling generic drug companies really unownable, uninvestable right now, and just looking at lawsuits like this garnering headlines. are you concerned that your industry is really losing the trust of both wall street and of, you know, american consumers? >> i think what our members are concerned about, meg, the amount of misinformation out there, mischaracterizing the generic drug industry which drives savings to the u.s. health care system to the tune of almost $300 billion a year annually as opposed to some of the things that are being said from the attorney general or others and making the case that generics are responsible for high drug costs. you and others know the industry has been experiencing an unprecedented and in many ways, unsustainable degree of price deflation for the last three years. an argument to the contrary, just counter to the foundational value proposition of the industry >> even as you've seen prices coming down over the last three years, if some of these

allegations are true, let's go back to the original question. is there a crisis of confidence in the industry when there's so much suspicion of the drug industry already and especially over pricing >> the answer to that question is no and i think all you have to do is look at the predicate of the debate in washington where we engage every day on an effort to lower drug prices through advancing policies there's not a lot that republicans and democrats can find common ground on but one of the things is the goal to lower prescription drug costs and whether it's the administration or speaker pelosi or senate republicans, all of them are focused on trying to accelerate generic competition to the market if there was a crisis of confidence in this industry, i have more faith in our public leaders they would not be trying to accelerate competition from an industry that they didn't think they could rely on >> and we've reached out to the companies named in the lawsuit and teva, in particular, responded, denying any wrongdoing and it's up to a court to decide but as for membership and your association,

if they are found guilty of these activities, would you kick them out >> i think what we have at a.m. and since i've arrived in late 2018, a code of responsible business ethics. the generic industry has been predicated upon robust ethical competition for years. that's how you can be 90% of all prescriptions but only 22% of total costs. this investigation will ultimately play out over time and i think it's important to sort of rebut the perspective that somehow generics are driving high drug costs. we know that's not the case but we stand for ethical robust market-based competition and that's something that will not change and one of the things that we do with our members is ensure that they are committed to the highest form of integrity on an annual basis within the association. >> two things can be true at once you can have generics be cheaper than other drugs and bring down prices overall but still have

collusion. >> i think if these allegations of collusion were as widespread and systemic and the attorney general claim to be, there's absolutely no way this industry would be delivering the value proposition in terms of the total amount of savings for the amount of the prescription cost in the u.s. market. >> if you say, okay, the generic made the price go to $10 from $100, that $10 might be higher than the 2 or 3 would have been otherwise. >> i think what you have to realize is that you're talking about a commoditized market, right? so where it used to take 8 to 10 on the market to get to where it's generally 80 or 90 off the list price in large part of the consolidation, you're seeing commoditized pricing with three or four competitors in the marketplace. i think when you realize that 95% of all generic prescriptions are available at the pharmacy counter for less than $20, it's hard to make the case that the

industry is somehow artificially inflating prices through market segmentation and other means. >> kelly took the words out of my mouth there two things to be true at the same time. as a hypothetical matter, do you think it's entirely possible that overall, generic drugs have caused total health care expenditures, drug costs to come down markedly while at the same time, there may be bad actors conspiring as is alleged by the connecticut attorney general and i believe 40 others to drive up prices of certain selected medicines under certain circumstances? >> i think one of the things you have to remember about a commoditized industry to answer your question specifically is that because of the competition, you will actually see pricing very consistent, close pricing whether it's traditionally in the reduction phase but in

limited circumstances with upward mobility, an industry with a limited number of buyers who come in and say, can you meet this price and maybe your competitor can so there is more transparency and visibility in the marketplace to what the current market rate is as a result, it's not surprising in a highly competitive industry, the prices are often similar to each other. it's a far stretch from that, saying people are colluding. >> chip davis, thank you very much we appreciate your time. meg, thank you for being here. >> thank you let's go to the bond market, shall we rick santelli is tracking the action at the cme this afternoon. rick >> reporter: it's been one of these sessions where yields feel firm they're just not moving aggressively look at a two day of tens. clearly, we've held yesterday's range and moving higher from trading 240 or 241 or 242. a lot of trade but the interesting part is, how sheepish the treasury market has

been here's one week of the s&ps with note yields but shadow boxing. and not too closely and took a while today before we saw any selling pressure rising rates at all. and when we think about the fed or inflation and export prices today, energy, look at the 24 hour crb, it bounced back really aggressively the problem is when you open the chart up to ten years, you could see just like all the other metrics that we have these days for pricing pressures. it certainly isn't showing up on that chart tyler, back to you >> rick santelli, thank you very much a closer look at the challenges home builders face as the trade war drags on the ceo of clayton homes about to join us and the amazing run of bitcoin propelled oz perilman to a huge and i mean huge lead

in the cnbc stock draft. can anybody catch oz he knew that was going to happen oz the medallist coming up on "power lunch" next

the trade war with china presenting huge headaches for home builders which rely on china. home builder conference with the ceo of clayton homes, a berkshire hathaway company hi, di. >> hi, ty. we're at the housing leadership summit with ceo kevin clayton named builder of the year for his innovations in affordable housing. congratulations on that and welcome. we'll get to that in a second but first, of course, we have to talk tariffs especially for affordable housing which is what you do how is that hitting your bottom line >> thank you, diana. we've seen about a 2% increase in pricing and that was before this latest round. so 4% to 5%, it's definitely, if this doesn't stop and the months ahead, i think it will affect demand as affordability, makes it harder and harder which is the focus of this conference which i'm glad to hear everybody including us is trying to get pricing down to help solve this affordable housing

issue. >> you'd have to pass those costs on to buyers, correct? >> they would over time, yeah. >> your parent company, berkshire hathaway, owns an insulation company, benjamin moore and you, the largest producer of manufactured housing, your double wides but you have bought now nine just another one last week, nine regular site building companies, home building companies, you know warren buffett very well. is this his master plan to own every aspect of the u.s. housing market >> charlie is a huge builder, designer, architect. he's always loved us from the beginning and so has lauren. we're so blessed to have the capital in the 100 plus year vision so right now, our whole goal is to help make attainable home ownership available to more people democratization, and the whole board, toured our factories recently they're kpooexcited for us to b some of the efficiencies to the

on-site housing that we learned on the offsite side. >> you would like to expand. berkshire hathaway wants to be in the top home builders with the big ones. >> we do because we want to learn that aspect. so with the nine builders we have now, we're on a run for the 8 or 12 months to be in the top ten. one of those, already has two panelization facilities. we're starting a new panelization facility, so we'll try to be one of the first companies to put more in the panel to help cost efficiency. >> exfloodplain thaplain that you said you're building a new factory to take new houses to the building site and put them together like lego pieces? >> homes of the future, a blurring of lines with pieces built on site and offsite. a panel that already has insulation, windows, all of that robotics and doing that. equally excited about the

manufacturing and housing side fannie mae and freddie mac announced with the roof and foundation, finance on par with additional housing and appraise those. >> new finance, new innovation no limits to what you can do. >> that important price point of the 149 to 200 and try to bring the housing site too >> thank you so much kevin klay to clayton homes. back to you. >> thank you fascinating story. bitcoin up more than 50% since the stock draft less than three weeks ago. what does oz know? who picked bitcoin will join us. something happening tonight with a huge impact on another stock draft picker we'll explain when "power lunch" returns.

the obituary's been written for this time and time again crypto is dead i don't think so we're down nearly 40% in the past year. a rebound is under way i'm going bitcoin for next year. >> well, that was the wall street mentalist oz pearlman making his pick in the second round of our cnbc stock draft a few weeks ago. since then bitcoin, bitcoin is up more than 50% it just hit a ten-month high that is pushing team oz knows to

the early lead ahead of mr. wonderful and seymour alpha. but plenty can still happen with more than eight months to go in our competition. on the news line now is the man, the myth, the mentalist oz pearlman oz, welcome. what's next for bitcoin? >> thank you, tyler. well, more to come volatility, some ups and downs, but i said it in the second round, and i say it again. that is going to lead me to victory. i told mr. wonderful, you go with the safe approach, i'm swinging for the fences here i think we're going to see five digits by next year. i think it's still going to drop bitcoin and crypto has just gone up and down. it's a global market right? as you see turmoil in markets, you see people kind of fleeing other directions and i think bitcoin by the time this ends will be upwards of 12,000 >> well, really as i think jim cramer was saying during the draft, what you really want to win this is variability. and that's something that bitcoin has in spades, i suppose.

>> absolutely. a blue chip stock that's going to be a fortune 500 company, what are the odds it's going to jump 100% in a year? few and far between. bitcoin, we have seen that so many times talk to the people that had it at $20,000, you know, less than two years ago. >> your other choices were disney down 2%, goldman sachs down 2%. it has been a rough month, or basically three weeks for stocks most of the other contestants are either up just by less than 1% or they are down by about 2% or more. i hear, i am told, that you have some trick that you want to perform with us or on us or something. >> well, what i said is a global footprint. am i right what happens in trade talks between us and china impacts the markets. every single day think globally is kelly there as well >> she's right here. we have whiteboards and we're ready to follow your instructions >> you spin a globe and you stop on someplace you've never been to you would love, love, love to go can you picture yourself planting your finger on a place?

can you see it in your mind right now? >> yes >> here's the thing. i know what you would go with. do you know why? because in new york and new jersey it's a rainy day. i'm seeing a beach in your mind. no one's going to be impressed if i guess somewhere tropical. i can tell based on your smile and your little laugh that's where you would have gone. so make this impossible. change your mind somewhere else a country, anywhere in the world, i don't know if you have been there, haven't been there i don't even want you to know why you picked it. do you have a place right now in mind that's not even your top choice something second do you have it in mind right now? >> yep >> please write it down on the board, cover it up, make sure even tyler doesn't see it. >> is it the same one i chose earlier or a different one >> whatever one you would love to go -- if you thought about this before, even better >> okay. >> did you tell a soul >> no. >> great >> okay. >> did you post this on twitter? you said something earlier did you post this to your twitter? >> no, i've been watching her closely. >> her first choice, when i said think of a place first place

that popped in your case, one of two, bora bora or fiji i'm going to go with fiji. am i right about fiji? >> yep >> who wouldn't go to fiji that's the easy choice but here's the tough one global markets you in your mind i planted the suggestion of a big city i said asia. i said north america you would have excluded those. you went to the biggest city of all, mega city, lagos. you're thinking nigeria. you were speaking about oil earlier. turn it around how did i do >> i changed it, oz. >> were you thinking of nigeria initially? yes, i was >> i'll take it. i get in people's heads. people change their stocks i still know what you were thinking you buy, i sell. i knew for a fact you were going to go nigeria initially. >> i'm going to investigate this wikipedia site that i noticed when we were discussing this i think i'm on to your ways. i've got a little something on you. >> get to the bottom of it, i will still win the stock draft >> you know what i was thinking, oz >> no. i think we're running out of time i don't know what's in your

head >> there you go. oz pearlman, thanks very much. we appreciate it see you again soon continued good luck. >> speaking of the stock draft it's a big night for another one of our competitors bobby flay who picked madison square garden hoping the knicks would ge who pick in next month's draft eric chemi is here to explain. before we talk about whether zison coming to the knicks there was also a new deal today between caesars and espn >> that's right. so disney is getting into sports gambling they've got a deal now with caesars entertainment out in las vegas. they're going to build a studio out in the linc hotel that's owned by caesars if you're seeing an espn arthuric'll and there are betting odds, those will be caesars' odds. and caesars will be doing an advertising commitment we're seeing these media companies getting together with casinos. it's going to get deeper and deeper now >> no coincidence perhaps this is the one-year anniversary of

the supreme court effectively legalizing -- >> there will be a sports gambling channel >> oh, they're going to have weekly shows >> zion williamson, where is he going? >> 14% chance he'll go to the knicks but it's also 14% cleveland, 14% phoenix >> what if it's not zion then what happens to msg >> bobby flay loses the stock draft. >> "power lunch" will be back in two. eric, thanks

welcome back it is time for a quick check, please just want to mention senator mitch mcconnell on the wires a

short time ago the quote from him is "nobody wins a trade war." not a ringing endorsement of the president right now. >> this is a very headline-prone market right now as you can tell this day's tweets up, yesterday's maybe not. >> so far stocks are shrugging it up. dow still up 291 >> thanks for watching "power lunch. >> "closing bell" starts right now. volatility is back on wall street >> a major sell-off in stocks today. >> new tariffs for months on end lowers global growth prospects in general >> i don't necessarily think we can say gee, that was it, we're past all this. >> been a wild turnaround here as we've seen all week long. 3:00, anything can happen. >> still an ugly day following what was the worst week of the year. >> what will today's final hour of trading have in store "closing bell" starts right now. it does indeed. welcome to "the closing bell." i'm wilfred frost. >> and