>> i think iemg, trade resolution, you can own it for a while. >> mchi, the china currency trade, positive. >> good stuff. thanks, all. thanks for watching. "the exchange" starts now. >> thank you happy monday, everybody. welcome to "the exchange." i'm brian sullivan here come earnings the future of this rally may hang in the balance as corporate america opens up its books what to expect and if it's time to get defensive plus no money, no problem. the amount of money losing public companies the past year at the highest level since the late 1990s more on this incredible story ahead. and friday's jobs number looked pretty good on the surface but if you dig down a bit deeper you may find some red flags. we'll have that, all that and more on "the exchange. we begin with the markets.

see seema, every time you're on "the exchange" we hit a new record high is that a coincidence or you >> it could perhaps be a coincidence. it could be the big week ahead we have the countdown to bank earnings tomorrow. phase one deal expected to be signed on wednesday. rounding things up with china gdp on friday. the s&p 500 notching a new intraday record high, up about a half percent on the day. the stocks that are sending the index higher are the stocks that worked in 2019 names like facebook, sales force, tesla above $500 a share. tesla at 518 look at one stock outside of technology that is also working for the market that's freeport macmoran up nearly 5% copper prices are higher bmo raising its target on the stock. brian, back to you >> seema, thank you very much. we'll see you in a bit all right. a new piece in the "wall street journal" highlights what some might think of as a growing

problem. despite a strong economy in stocks as you heard at record highs, the number of money-losing companies continues to grow. about 40% of u.s. listed companies have been in the red for the past 12 months, the highest level since the late 1990s. to help explain this and what it might mean for the markets, let's bring in mark holbert and bob pisani mark, your column we snatched and put on television. good stuff here. do we need to worry or is it not as much of a red flag as the headline may seem because so many of these are biotechnology companies. >> yeah. i don't think it's a worry this is a long-term secular trend. it turns out that researchers have gone back actually four or five decades and found there has been a growing concentration of profits among the very biggest companies. i'll give you one statistic. in 1975, about 48% of all corporate profits were concentrated in the top 100

companies. that stayed more or less constant up to 1995. in the latest time they looked at it, 2015, it had grown to 84%, which is to say basically 100 of the top companies are getting almost all of the profits. that means almost every other publicly traded corporation is scrambling for the crumbs that fall off their table >> bob, when you were down at the nyse, you talk about record highs, is anybody coming up and whispering in your ear, yeah, but none of these companies are making money does anybody seem to care? >> i think there's a little less than meets the eye with this story. i agree with your point on this. the problem is that a good part of biotech, probably 40% of them are biotech. their numbers are increasing they always lose money secondly, my impression has been over the last 20 years, between 40% and 50% of the companies operate at a loss. i'll tell you what would be more interesting. if you pulled out one-time restructuring items. that has become more aggressive

in the last 20 years more people -- more companies are putting in one-time charges that result in losses. i would like to see the data x that number to get alarmed by this so far the article i saw, i wasn't particularly alarmed by it >> mark, it is your article what about the data in that is it really just one time tax charges or are companies that maybe should not -- by the way, companies that have gone public lately, the big-named ones have not burned up the charts looking at uber, lyft, blue apron. not everything is okay >> that's true again, this is a secular phenomenon so i think we need to abstract ourselves a bit from the most recent earnings season and so forth and look at these broader trends there's an economist i follow a lot, jeffrey parker, he called it the winner take all economy that we -- because of network effects, the internet, that we're moving in an era where

there is going to be increasing concentration. that's why he calls it the winner take all economy. i think that has profound implications for what it means for the future it doesn't necessarily mean the fact there are all these losing stocks is in and of itself an alarming statistic >> bob >> look carefully at that chart on the ipos. we have known for a long time that two-thirds of ipos don't make money in the period in which they go public immediately. i'm not sure that's a particularly alarming statistic. it's certainly better to see it go down. given how difficult it is for companies to go public, there you see the chart. yes. it's gone up a bit since 2010. if you look back into the 2000, this is a long chart you're going back 30 years it was back up around 70% in the later part of the 1990s. >> yeah. i should correct myself. it was james mcintosh at the journal. you write so much good stuff, my head got confused. i'm giving you credit for articles you did not write

either way when you wrote that article, did you think to bob's point, this is fine. when the journal writes an article like that, it appears that somebody there thinks this is an important story. >> yeah. i do think it's important. but it's perhaps important in a different way. for example, one implication that i think to draw from this long-term secular trend, it's more important to be diversified. it's around 4% of all publicly traded stocks have almost all the corporate profits between them if you don't happen to own those 4%, it will be difficult for you to equal the market averages so i think it has implications for whether you should go indexed or active investor, it has implications for how diversified your active portfolio has to be. >> i agree this is why yoet ogrowth outper value. growth is hard to come by. because of that, people will pay

a lot of money for it. sometimes overpaytor for it. i imagine it's okay to grow if you don't make money i'll lose money on everything i sell but make it up in volume. thank you very much. appreciate it. boeing has a new ceo the company is still facing the same problem, moving past the 737 max crisis and a corporate culture sha raithat raised seri eyebrows can dave calhoun turn things around at boeing >> he thinks he can. he is a guy who has vast experience and can turn around the culture. the trail left by dennis muilenburg and his administration, if you want to call it that, when he was ceo, this is one that people are struggling to get past especially the exit plan and the compensation or lack of compensation he got no severance. he's forfeiting $14 million in

stock awards but still getting $62 million in deferred compensation that's not a golden parachute. that's what he was entitled to over his years of working at boeing as for dave calhoun, his base salary is 1$1.4 million you have to look in terms of what kind of extra bonuses might be possible if he gets the max up and running safely, returning to service, that could be worth $7 million in his first year, he could hit $28 million, depending on whether he hits certain incentives and benchmarks. he has said to employees in an email that the 737 max is his prime focus. this company has been muddling along over the last three months as they're working their way through the 737 max. expect dave calhoun to make quick decisions so they can move forward as quick as possible >> i would imagine one of those

quick decisions is not just pulling out dates about return to service out of thin air >> no. >> and shocking regulators to great anger. >> no. and remember, one of the calls he made after the board said he would be ceo, he called the head of the faa and he said we want to be regulated. we want to work with you huge change in terms of the comments coming from boeing to the faa. >> phil lebeau, appreciate it. thank you very much. >> you bet well, if you want to be in retail, you better hire some really good computer programmers. because technology is becoming a bigger and bigger presence in the retail industry. it's evidenced by who is attending the national retail federation show. courtney reagan is there courtney, you're at a retail conference i'm looking at microsoft and google and hp behind you tech's influence in your sector

is only getting larger >> that's exactly right. this is probably the techiest retail conference of the year but the influence has only grown tremendously over the years. you have players like microsoft, google, s.a.p., oracle, jda, hp, that are participating, you also have thousands of smaller players, these start-ups that's a group that's grown tremendously they're offering cloud solutions, scheduling and 3-d body scanning. systems that can turn nearly any space into a micro fulfillment center they have autonomous robots. drones these are all features here that have become more and more prevalent over the years kevin johnson was on stage here. he was talking about how starbucks artificial

intelligence program, deep brew, is helping sort of take away some of these tasks from bar wrist ba barristas so humans can start reconnecting in stores it's artificial intelligence helping us connect with humans, human to human that's the world we live in. >> speaking of human beings, you spoke with one yesterday the kohl's ceo she said she was disappointed with the holiday quarter with you thing that undershot it, lululemon. that stock is up 4% now. what went right for lulu, what went wrong for kohl's? >> shares of lululemon have been higher by 90% over the last year maybe they would be higher if they didn't have such a run. what is lulu doing right basically everything they reaffirmed their earnings forecast and revenue forecast,

comparable sales they think will be stronger than previously expected and jpmorgan's matt boss says if history is any guide, the last five years when lululemon preannounced in january, they almost end up undershooting it when you go back and see the full quarter reported. so lulu's hitting on those retail fundamentals. they're offering great products that consumers love and want to pay for. sales is not really part of their m.o. even though we live in this promotional environment. and this holiday season was no exception. you look at kohl's what happened at kohl's, it appears, is that women's was their weak point it's a problem because it's 30% of the business. when you add in women's accessories, that's 40% of the business of that, 70% of that is private brand, which means brands you can only get at kohl's if that doesn't excite customers to come in, that will be a big issue. but the ceo says she has her arms around it

she's working through a plan she will tell us more about it then >> enjoy the ntf -- i mean the nrf. thank you very much. coming up on the exchange, the future of this rally is in the hands of america's balance sheets earnings season kicks off. will companies deliver or is it a time to get defensive? it's not just the big banks that had a stellar 2019, the payment stocks soared as well. will investors tonight to bet consumers will keep swiping and maybe a trillion reasons to love google stick around you leave it to me. i'll get your taxes in an ok place. what? just as soon as my audit's over, this gets my undivided attention. you take a lot of trips to the islands, phil? pretty great, right? oh phil's legally dead. fell off a boat. going by denis now. celery. long story. what do we got here. oh. not going to want to see this.

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welcome back earnings season is kicking off in a big way with 26 s&p 500 companies reporting their quarterly numbers. refinitiv says growth will be down 0.6%. jason brady joins us and steven whiting also joins us from city private bank jason, when i look inside thornburgh's investment income builder fund, nearly one quarter that fund, 24%, is financials this week you got jpm, wells fargo, citigroup are you expecting great things from this important sector

>> i think we're expecting good things i think to expect great things would be lower npls, a much stronger economy, none of which are in the cards for us. keep in mind the expectation of this sector is extremely low you have relative to 2008, everyone is expecting if there's going to be challenges, it will hit large cap banks. those banks have been highly regulated, low valuations, high yields the risk in that sector is more in the small and mid cap bank space. >> steven, are there better markets for viewers money than the u.s. equity markets? >> we like the u.s. market i think this earnings season just passed will be a 1.5%, 2% up quarter the full year 2020 will be a 7% gain we should be looking right now -- >> historically the exact average. >> we had a 12% return in equities in the united states. if we look at two years, last year was up 32%. the out performance of the

united states was extreme with a 9 percentage points of out performance. if you think about european industrials, european financials, some of the asian industrial companies that are still suffering from trade war fears, those will probably bounce back more in the near-term. what we really like, this is global, is companies that don't need outside financing, that can raise current dividend payments to their owners in the u.s. and abroad this year and next. those firms will really be the right investments after the bounce back effects are out of the way. >> this segment is a police song i see synchronicity. your single biggest holding is orange you also have china mobile and taiwan's semis so you're looking outside the united states as well. >> absolutely. we tend to skew outside the u.s. because that's where the income is what we're looking to do is

build income over time, provide investors yields so you look at some of those names, they are cheap from an ebita perspective. generally self financing cash flow generative when you have dividend payers, they are generally -- we look for ones generating their own cash flow. i agree you have a pull back of companies that are self financing will be able to ride that out much better than other companies that you could invest in >> well, think about two, just where investors are. if we want to look at the big picture, two years here where macro policy risks threatened the continuation of the expansion. all of these risks have generally gone by the wayside. they're going to have a trade deal with china this week. the federal reserve is easing credit providing more financing to the bond market, whether it's treasuries or mbs. and that will continue for some time we look at yield opportunities, even in riskier fixed income

markets. these opportunities are lower. last year investors pulled 2$235 billion out of equity funds globally that's why, again, the rate for many has been a higher market. >> jason, what's the biggest global risk still on the table to you >> i actually disagree a bit with the forward outlook on the fed with steven. i think the fed is really much more on hold today they will have much lower -- the likelihood they continue to cut is much lower unless we run into serious issues it's continue grinds and manufacturing with lower isms across the world if the fed starts to cut, it's because we're in recession i don't view that same thing in '19 as 2020. >> we don't see the fed cutting, it would take a shot the fed is versing quantitative tightening ism readings, pmis all bounce back before the first quarter is

over >> good discussion, good friendly debate. jason, steven, thank you very much we'll have you both on again. deep discounts not enough to get people shopping at this retailer the stock on pace for its worst day in five years. the name behind that ugly chart ahead and why the last jobs number may not be telling you the entire story about the american economy check out the cnbc app hey, saved you a seat.

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welcome back it's a big week for the financials with some of the biggest banks reporting numbers. jpmorgan, wells fargo, citi, they're out tomorrow goldman sachs, bank of america wednesday. if that was not enough, morgan stanley out on thursday. here are some key macro things to watch as reported by wilfred frost who will be getting zero sleep this week. can strong loan growth continue to offset lower interest rates will recent broker price wars eat into wealth margins and will revenues that could be flat this year, the thoughts could shift to cost control and digital distribution the rest of the big banks are not behind on performance, these earnings may not be the easiest ones to watch. we'll have that for you all week long on cnbc right now let's go to sue herera

and our cnbc news yub dat s upde >> here's what's happening, a major clean up is under way today from the south to the midwestern parts of the u.s. after a wild storm system caused widespread destruction 11 people were killed. 1 tornado was confirmed. >> the supreme court rejecting an appeal from a massachusetts woman who pushed her boyfriend to commit suicide via text the decision leaves michelle carter's involuntary manslaughter conviction in place. the boyfriend took his own life at the age of 18 carter was 17 at the time. an australian warship is setting sail for the middle east to protect vital shipping lanes through the straits of hormuz. reporters were told the ship will play an important role in protecting the economic and oil interests in that region the sports world helping australians impacted by their country's wildfires. the international tennis federation and the wimbledon

french open and u.s. open tournaments announcing a collective pledge of an additional $400,000 towards relief efforts already under way in that country. this follows individual players who made pledges of their own over the weekend the australian open begins a week from today. you're up to date, brian that's the news update this hour back to you. >> thanks very much. on deck, could now, right now, finally be the time to buy and own ge stock yeah, ge one analyst says yes we'll dig in and find out why. look out below why this retailer's stock price is taking a nosedive today and apparently the doctor will see you now. it's one of the biggest weeks for health care kicks off. we'll look at the role washington will play in your health care.

an electric quarter, here comes another trillion, porsche

speeds ahead and taking care of your chickens. time for rapid fire, here are kate rogers, robert frank and seema mody deutsche bank has a new short-term investment idea and it is general electric ge that call boosting the stock about 3% right now putting it on pace to break a four-day losing streak deutsche bank saying while it's difficult to identify positive catalysts this quarter, it expects ge to deliver an earnings beat and good guidance for the year and positive statutory insurance review whatever the heck that is. so basically they're saying no catalysts, but buy the stock >> yeah. not a lot of positive, but it won't get worse. that's been the big question related to general electric. when i spoke to their ceo, larry culp, after earnings in october he reminded me this is a transformation turnaround story that will take a lot of time his main goal since becoming ceo in october of 2018 is to reduce their debt, raise as much cash

as possible by selling out their baker hughes stake and continuing the sale of bio pharma to $21 billion. it will take some time the stock is up about 16% over the past three months, well off the all-time highs of 58 a share back in 2000 >> remember those days that's when they had ge capital. ge capital as i called it one time, ge was a hedge fund that happened to make light bulbs they always had ge capitals where they could find earnings juice when they needed it. now they make locomotives, oil wells. >> the power piece of it is so important and we don't know what the max situation will bring for ge there's delay upon delay that future, if it looked certain a month ago, is less so. and they have investigations you can see the negatives. you can't see what the upside surprises are they're talking about. they said we don't know why, but we'll get an upgrade on the

earnings for 2020 and have a stronger than expected quarter >> analysts are just running out of ideas at this point >> it's good >> yeah. >> it's like is tshhtar, the movement i have, it can't keep getting worse. it does. alphabet marching back to $1 trillion in market cap despite being late to the game the company would become the fourth technology company to cross that 13 digit threshold currently ahead of amazon which pulled back. evercore is boosting its price target saying it expects google to dominate in search and video advertising. kate rogers, youtube, i know that search is everything for them youtube, some people think it's a 100 billion, 2$200 billion if it's by itself >> it's easy for us to forget about it all the people using youtube are the younger kids some of these youtube

celebrities, the amounts of money -- >> the 8-year-old who made 27 million unboxing toys. >> exactly that's something i don't use all the time it's not something i have at the top of my mind >> toy unboxing videos >> no, but youtube in general. i'm more of a facebook instagram user they note ambitious long-range products like driverless cars, and forays into medicines has not paid off yet >> you know what the first billion dollar company in the u.s. was >> gosh. >> u.s. steel 1901 >> 1901? >> i was going to say some radio company, rca in 1922. >> the first 1$100 billion company was ibm in 2007. the question for me, who is the first trillionary? i think jeff bezos what would amazon need to be for jeff bezos to be a trillion aaie

84 billion >> it speaks to the narrow leadership already in -- >> some people think vladimir putin is a trillionaire. >> if you add up all of russia, it's all his -- >> slice this up, a rosneft over here, you get to a trillion easily >> topic three, the luxury auto market is rolling on porsche reported record global sales in 2019 delivering 280,000 vehicles or 10% more than the year before. rolls royce setting a new record with its own $400,000 suv. and now ferrari is looking to get in on the action after raising full-year guidance last quarter. not all is well, robert frank,

in the luxury auto markets those cars doing well. let's focus on the negative. what happened to aston martin? >> a lot wrong with that company. products, management >> what's wrong with the product? good looking car >> but they all look the same. the vanquish, the vantage, they all look the same. very expensive they have so much competition now. it's all riding on the dbx, the suv, this will be a $200,000 suv. there are between porsche, mercedes, the number of expensive suvs out there, too much choice. >> and now does china's geely come in and help aston martin which has a lot of debt. ever since the ipo, the stock has opinion on a free fall even china could not provide the rescue line that aston martin is looking for. >> it's a tough situation. outside of them, there's no other buyer.

so they have -- >> you wonder, how much money is out there, kate. these cars are so expensive. i guarantee these are not people buying on credit >> look how much wealth has been created in the united states over the past year >> so people are selling their apple stock to buy a rolls royce? >> they feel wealthy, they have that wealth. and global growth around the world was not bad last year. >> when your driver picks you up to come do "worldwide exchange," would you prefer them to be in a rolls royce or -- >> i drive myself in my honda suv. >> two-thirds of sales are suvs. lamborghini, most of their growth was suv rolls royce -- >> i drove it last year. >> it's awesome. >> i was in florida, it was 20 miles per hour, it was awkward to only go 20 miles per hour in a lamborghini. >> all these traditional sports cars companies, it's not the cars driving the growth, it's the suvs and the evs

>> i'm with kate i'm good with a honda. i don't need a fancy car it's a deprecating asset >> i got leather seats feels good >> we're insecure, we need it. >> i drive a 2010 jeep wrangler with roll-up windows you have seen it i still have the roll-up window. >> it works. >> that's why my left arm is so strong strong like ukraine. next up, shares of five below are on discount today hitting their lowest level in a year the stock is on pace for the worst day since 2015 after reporting disappointing holiday sales. the ceo blaming six fewer shopping days. really everybody i'm told has the same calendar six fewer days >> it does matter. shoppers didn't have as much time to get out there.

>> that's at every store >> yeah. >> the same amount of time everywhere >> i know, but certain categories of stores are not doing as well. macy's called this out their stock got a nice boost because it wasn't as bad as people projected still negative over the holiday season this retail environment is something else i was at target on black friday, people are not there the way they used to be years ago. it's shifted they added more people allocated to pick up and delivery. that's the way people want to shop and five below won't do well with that. >> have you ever been in one my daughter loves this store makeup >> five-pound mike and ike bags, beach balls. cell phone cases >> just a bunch of stuff -- >> you're calling mike and ike a waste? >> the reason it's done well, it's amazon proof is that people want to go to the store. >> because you don't know what

you will find. >> that makes them suffer when the calendar is shorter. there you go >> discount retail in general is a very hard game to play the price point is already so low. if your incremental costs go up even by a bit, margins get hurt. in the late effort east earning they are a business that relies on manufacturing happening >> a lot of this stuff is -- what did you call it >> trashy? >> trash or junk >> the remote controls, they didn't sell well >> they did not sell seema will bring a giant bag of mike and ikes on set next time this is great. marshawn lynch, beast mode what a history of avoiding reporters questions after the game or giving a one word answer after last night's loss he used the press conference to share financial advice to younger players. listen up. >> it's a vulnerable time for a lot of young dudes

they don't be taking care of their chicken right. if it was me or if i could let them know something, take care of your money, [ bleep ] don't last forever take care of y'all bread, when you're done, you take care of yourself why you're at it right now take care of y'all bodies take care of y'all chicken you feel me, take care of y'all mentals. we ain't lasting that long >> he knows a thing about taking care of chicken. having earned $57 million in the nfl and millions more in endorsements this is a guy who retired for the better part of a year. he knew what it was like not to have an active paycheck coming in no matter how much you make coming in, people are not putting money into your bank or your chicken into that bank. >> i'm changing my title from wealth reporter to chicken reporter >> is that senior chicken reporter or chief?

it's sensitive in this industry. >> poultry, just all kinds of poultry. >> head poultry guy. >> one out of six nfl players declare bankruptcy we all know the stories. for someone who has been in the league and left, he can come out from the other side and say here's what you have to focus on >> you get used to that money rolling in forget about what you do for a living, kate, it could be whatever industry, there will be a day when you wake up and there's not a paycheck there >> i think it's important, we're all laughing about the term he used it went viral. people hopefully hear it and think about taking care of their money. you often don't hear these stories until it's too late. it's nice to hear from a player still in the league, doing well, retired for a while, came back, but giving out advice to people and hopefully some other younger players listen to him. >> we watch the games and think this is fun. but at the end of the day, this is a cut-throat industry contracts are not guaranteed a lot of these players get

injured after three, four years on the field it's a good reminder that you have to take care of your finances, chicken, whatever you want to call it -- >> the average length of a player is 2 1/2 years. average time in the league the odds are small i will push back didn't go viral. it was a nationally televised press conference >> we're all talking about it. >> you can buy a lot of mike and ikes for 57 million bucks. thank you very much. the headline jobs number suggests a tight labor market. but hours and wages could be signaling some trouble ahead steve liesman is aheaditwh wh y. it's them, calling us. it's going to be a week before they can get through on these roads shhh, sorry, i didn't catch that. i said ask how soon they can be here right now? what's now? he says they're surveying our property now they're probably at the wrong house i don't see any hovering his name is hovering? look up? by automating claims with machine learning and analytics, cognizant is helping insurance companies advance

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look at the headline numbers and recent jobs reports will suggest a tight labor market but if you dig into the wages data, there are red flags that could point to weaker economic growth ahead steve liesman has more on why. what did you see that caught your attention

>> the tight labor market used to be a mystery to economists, why aren't wages rising faster and why is the work week falling? the work week has declined by 0.3 hours, the unemployment rate has fallen from 4.9 to 3.5%. now look at wages after increasing nearly four years, gains have declined for 2019 the generally soft pace of wage growth in this expansion is not a puzzle given extremely weak labor productivity growth. but the deceleration of wage growth over the course of 2019 is more mysterious here's they reasons why that might be the case. you have a substitution effect where younger workers are replacing older workers. you have a change in the mix where low-wage retail and leisure and hospitality jobs are replacing manufacturing jobs and then an issue of monopsony >> monopsony

>> you have a monopoly essentially on the purchase. in this case the purchase of labor. that's a situation where -- i think you know something about this, in rural towns where there's only one manufacturing employer, where there used to be maybe more than one, there's no choice they have essentially a monoponsy. >> all those people out of manufacturing have to go in the services industry. >> big part of it. the bottom line here is if you have modest wage gains, you may have modest consumer spending and economic growth. >> it's an important story thanks visa and mastercard have been posting huge stock gains, both hitting record highs. will this under the radar rally push into earnings season? what's your best play here that's coming up

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welcome back as stocks continue hitting

record highs, one sector is riding an under the radar rally. that's the payment stocks. look at this in 2019, mastercard rallied nearly 60% visa up 42%. the digital payment names, paypal and square saw names also saw a jump and our next guest says she rehans bullish on isish on the . lisa, welcome. what did mastercard and visa do so well that they deserve 42 and 60% gains? >> they just keep cranking out the earnings growth year in an year out they've compounded earnings at 20% now for ten years straight >> is that them doing something right or the consumer spending more >> consumers spending more, but really about them using cards more and cash less every year, these guys do about 12% volume growth. most of which is just coming from people substituting cash

and using cards. >> i'm going to knock them a bit. what does that mean they're doing well because we choose to use cards? little, what role do they play in that when there's basically just three or four card companies in the world >> yeah, the key thing they do is they create that trust. they are the ones that authorize the transactions, so when you walk into a store anywhere in south africa, you walk into a gift shop, they verify that you are u who you said you are and that you have u the money and your able able to just hand over a piece of plastic and walk out u with a handbag or pair of shoes. pretty amazing you can do that anywhere in the world without cash and they're really the network. >> and you still like both stocks, but you think your best idea for this year is square >> that's right. love that mastercard and visa, can't go wrong with those, but going into 2020, we like square

the best >> why i like their system. they flip the screen and you just sign, no receipt. >> they've divested cavier >> which they only bought a couple of years ago. >> you know, we're glad they got rid of it and they're moving on and they've got this really hot cash app product, one of these consumer digital banking products like a paypal wallet literally, 20 million or so consumers are using that to send each other money as a debit account and that business is growing almost 100%. >> 100% per year >> in two and a half years, it's gone from 1 million in revenue to a run rate of over 600 million of revenues. >> not bad makes sense. best pick is square, but says you can't go wrong with visa or

measuring a. got a news alert for you in the ipo world. dow jones reporting that albertson's, the grocery store chain that used to be public then taking private, is preparing for an ipo again around $19 billion the company last filed for paperwork back in 2015 bio tech as a group falling about 1% today as the jpmorgan health care conference gets underway up next, a top analyst gives us his road map and why certain parts of bio tech could be the big winner that's next. driven solutions and services. change healthcare is thrilled to be joining the nasdaq family. every day we are working on behalf of those who expect more from the healthcare system. our customers and partners push us, inspire us, and make us better. together, we make the healthcare system better for all.

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with the ww triple play! the massive and important jpmorgan health care conference kicking off today in san francisco where one of topics of conerer sags is sure to be the election whether or not president trump is elected or a democrat wins, the push will be for drug pricing reform and patient afford bability. for more is neil, senior adviser on health care policy at gugheim securities. i don't know how you do your job because everybody's talking about drug pricing e reform then o obama care and candidates who

some are near or leading the polls talking about ending the world of private health insurance. what are the themes given that >> chaos is our business thanks for having me on to talk about it so, so although there's a lot going on, i think it boils down to force in areas that we might see. on the one hand, there's the chance we move way to the left if the right combination of candidates and policies are discussed. the more likely snacenarios i ve as a real battle over the aca. the status quo would be the next li ly scenario then a 20% chance where we would see actions that could have a real impact >> what would be the biggest thing that may not be a probability, but a possibility and would have a massive impact? >> well, i mean clearly the ac ark being overturned by the supreme court would be the big

thing. i don't see that as a likely scenario, but you know the more impactful sort of shock wave that could come through would be if we really did see a lurch to the left people don't fully appreciate that while president trump has been aligned with a lot of the more left winged democrats on the drug industry for the last couple of years in terms of price controls and other ways of looking to address that issue, the insurance industry and aca obama care space, he's been more in line with the republicans and talked a lot about looking to pull back on obama care and replace it with something else sochlt to the extent that the battle goes there which i would view as more of a summer to fall type of time frame, i think that could create some volatilitvola the hospital and insurance space a. >> what are some macro investing themes how can we make money off this chaos. >> well, i think on the pharma

si side, pharma's been in 25th place out of 25 industries for the last year or two in terms of public opinion so there's been a drag in terms of expectations and what might be done to them on the policy front and i think we're going to see that calm down in the first part of this year we have seen price increasesso far that seem relatively in line or maybe even a little below what we've seen in the past on average and so if that continues and things play out the way we expect them to, i would imagine things will calm down for pharma at the same time, i do think they're going to ramp up on the hospitals and commercial insurance side because what we're going to see is a real sort of relitigation of the whole aca obamacare type of debate, which was so good for the hospital especially in terms of coverage and their care costs

so that's a real area to watch >> back to the conference. i know it's just kicking off great stuff. see you soon thank you very much. >> thanks so much. >> of course cnbc's going to have all the big interviews from that conference. the few new pfizer ceo bb b will be here tomorrow, but stick around for "power lunch. we've got an interview with gilead's chairman and ceo. "power lunch" by the way begins five seconds ago >> you're borrowing time from yourself welcome. see you in a minutes welcome, everybody here is what's new at 2:00 on a monday "power lunch" with stocks at record levels. wall street is betting on new highs ahead. we'll talk to a couple of strategists about that plus speaking of new highs, tesla surging as one analyst nearly doubles his price target on the stock to become the biggest bull on the street check out th