certification of the vote in front of the house and senate on wednesday. who knows? but at any rate, a stiff falloff today. >> and to kind of remind everybody in terms of taking a breather, the nasdaq is up 80% in two years the s&p is up i think 35% or something like that. huge gains, but the vix is popping today. one as mike santoli was talking about, a 5% increase until that settles back down, that's one to watch. good to see you as well. that does it for "power lunch. "closing bell" starts right now. >> thank you welcome to the "closing bell." i'm wilfred frost along with sara eisen the first trading day of the year turning out to be a wild one. record highs at the open quickly giving way to the significant selloff you can see behind me. the major averages around 1.5% as we look at the final hour of trade. investors closely watching georgia ahead of tomorrow's special elections. the outcome will determine which party holds the majority in the senate and could have a major

impact on president-elect biden's agenda the selloff is sending money into safety trades, gold and silver both moving higher, and the virus, of course, remains top of mind. uk prime minister boris johnson set to speak this hour amid talks of stricter lockdown as cases there hit record levels. of course, may the u.s. follow, a question investors have in mind here. sara >> the beard goes into 2021. nice we'll have much more on today's selloff throughout the show. also coming up, a bull/bear debate on boeing, weighing on the dow. we have two analysts who just published very different opinions on this name. and in just a few minutes, ad executive sir martin sorell joins us with an outlet for the new year his companies two new acquisitions let's get to mike santoli who is tracking this. how severe is it >> not as severe as a couple

hours ago, and we were up about 3.7% in december given back about half of that right now. it doesn't seem as if it's cut into any of the broader trends but definitely enough excuses as we greet the new year to take some off the table definitely looks like some of the big winners are coming in for the heaviest profit taking right now. the s&p 500 over the last year, we have come down to 3693, 3690 for those who care is the break even level for the santa claus rally, a period december 23rd close. we're near there, not sure that's going to dictate how the year goes but we're holding above this floor 3650-ish sort of capped the market for most of november. broke above that, so it seems as if we're sort of toggling around the vicinity of the highs. i do think it's sort of intuitive that we might see after we lost the seasonal tailwinds in december, you might see deferred profit taking it seems like that's what's going on look at the volatility index over the last couple years i have pointed out constantly

how it's been stubborn in not declining to what would be called normal levels coming into 2020, we were hovering in the 12 type area that's also a strong grinding fourth quarter rally but one that had not had a massive shock nine months earlier. we have not receded below that 20 line. it's a demarcation line between normal and agitated markets. now around twathd, and people are bracing for a tactical risk. if you want to look at the vix futures curve, this sometimes tells you if there are these concentrated areas and moments in the future when people are bracing for more the start of this line is the january vix futures. that expired january 19th or so, and usually when you see this hump t shows you february is where people are concentrating a little bit of the perceived risk, whether it is around first quarter earnings coming out, whether it's around the inauguration date, who knows what it is, but people are

saying let's lock in some gains. this is usually dictated by people buying put protection on their portfolios the normal, quote normal slope is going to be more gently uprising keep that in mind. it does show you, though, nobody is going to be shocked if we hit turbulence here. people have been bracing for it for a while, guys. >> right, and you have been warning about the higher implied volatility, mike how do you make sense of the georgia runoff election? we're just hours away now. the stakes are high. wall street literally has to brace for who holds the balance of power in the u.s. government, and it's almost a toss-up. last i checked the belting odds, 55% chance that republicans keep the senate that's pretty close. >> right, so therefore, there's suspense over this widely watched known potential catalyst tomorrow i think that in itself, no matter what the policy takeaways or implications were, that in itself is going to tell you people are going to toggle around this potential risk around that area

what are we hoping for or against in terms of it's very difficult to handicap, whether it means more or less stimulus, more or less prospect of tax increases. it's still going to be a roughly gridlocked senate. you'll have moderates as the swing factor it's tough to say beyond the fact it's one thing out there on the calendar we can worry about, and not make too much of a 1.5% or 2% decline in the s&p 500 in the face of that because we're up 16% last year, and probably nobody should be surprised we have a little bit of roughness coming into this year. >> mike santoli, we'll see you in just a few. thank you. for more on today's selloff, let's bring in david zurbs, chief market strategist at jeffrey's. you have been pretty positive on the entire market, on everything, stocks, bonds, i think, commodities do you think anything changes now that we're starting this year with a thud >> i don't we had a pretty hefty run up right at the end of the session to end the year.

i guess, you know, now we unwound that and then a little bit more, maybe less than a percent beyond that. it was a pretty incredible year, sara, and i don't want to read too much kind of like what mike was just saying it's just hard to read a lot into this things we had an incredible year that we just put behind us. we got a lot to worry about, i think, with the georgia runoff tomorrow i think that could be a catalyst i think you're right it still does favor the republicans and there still are moderate voices to temper anything too progressive for markets, but you know, we could get a little hefty selloff if we see both seats go democrat, democrat, and then we have to start hearing what the moderates are going to say, but i don't think it changes the big picture for 2021 at all. >> david, reading your end of year note, it seems to me that the big picture as far as you're concerned is it's don't fight the fed again, don't fight treasury, if there's more

stimulus, and you reflected on how that's kind of been the advice at the end of each year for the last decade. i guess my question is to what extent is that view much more established this year, much more of a consensus this year than it has been at any point over the last ten years >> i think it is, but you know what's interesting is you have a lot of people who are kind of questioning central banks. i mean, the run-up in bitcoin is definitely a central bank story line for a lot of people, even though it may not be the case at all, it may just be a technology story, we don't know, but i think there's a lot of clients out there that are at least sending me notes and what i hear when i listen to you guys interviewing various folks as well, is a little nervousness about do central banks really have this under control? you may say it's priced in, but i'm not sure it doesn't take much to get people a little nervous and a little bit kind of concerned we saw it at the end of 2018 when jay powell made some kind of off the cuff remarks that really gault the market nervous and it took three months fix

that i think we have learned, you know, jay has learned a lot. you have a pro in janet coming back in on treasury. the combination of both of those individuals together is just really going to be hard to fight that, that sort of impetus for i think success when it comes to economic policy making coming into this year and probably for a few more years to come i mean, jay probably won't make it to the next round, but that's a different story. >> so there are risks, as you mentioned. even with your bullish positive outlook. we're just getting headlines that the uk is going into national lockdown to try to deal with covid-19. this is obviously still very much with us where do you go for protection, to hedge yourself? this is something you have been writing about and it's harder and harder to find things. >> yeah, you know, this is the reason the vix is up at 28, sara in the old days, if the market was up here, the vix would be down at 12 because we would have had treasuries as a hedge. we could have been buying

two-year notes or five-year notes, doing the old ray dalio risk parity trade that's been around for decades that's worked like a charm and something we have been advocating for our clients for over a decade at jeffrey's. so it's tough. i mean, the dollar isn't moving today. if you bought the dollar as a hedge, you're not winning anything last i checked, the dxy was down are you going to win with other risk-off bets that have worked in the past? there's no rate trade. even ten-year notes haven't moved much today so again, i think i have struggled with it. i think a lot of people have struggled with it, especially folks that have been in the risk parity land, and now you're placing your bets with the central banks, and look, there could be more volatility this year because of that and i think there will be. you just have to kind of tolerate it and understand that we have moved into a very different rate world you can't use investment grade credit you can't use the rate market, the swaps or the treasury

market it's flying a little bit more naked. it's flying with a little bit more trust that the policymakers have it under control, and that may not sound good to a lot of macro guys, but hey, you know, i give janet a lot of credit for what she's accomplished both as chair and throughout her career in the federal reserve i think she's going to make an incredible treasury secretary, and i think jay has come into his own after a few bumps and wiggles, and i think whoever the next chair is should be and probably will be very much a seasoned veteran so i guess i'm going to say i'm not that worried >> david, always a pleasure. thanks for joining us. >> thanks for having me. >> dow is down 500 the session low was 725. >> still ahead from georgia election implications to bitcoin's wild day we'll have much more on this selloff and what it means for your portfolios. we'll speak exclusively with sir martin sorrell for the outlook for the ad industry and tech

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firm s4 capital surging 160% in 2020 and starting the year with two new acquisitions as part of a bigger push into digital ad strategy. joining us now in an exclusive interview, sir martin sorrell, good afternoon to you. and happy new year >> good afternoon and a happy new year to you. >> let's start with these two acquisitions, around $200 million in total, according to reports. i'm not sure you have confirmed that directly. >> i would confirm that, wilfred. that's fine. >> with both companies being based in the u.s., is this a geographic push as much as it is an ongoing push into digital >> well, it's a bit of both. i mean, it's a push into further digital content. and digital media. with decoded

and a push into performance media with metric theory but both companies are based in the united states, as you said and there's scope and room for geographical expansion as well it's sort of neatly timed, i think, for our post-brexit move, because i think british companies post-brexit will have to get their boots on, if i can put it like that, in terms of geographical expansion not to pull away from western europe completely, obviously, because it's still a very important part of the world economy, but more to north and south america and more to asia pacific, to africa, and the middle east. we'll be doing more as we indicated in the release of those areas too. so it's really an expansion of our capabilities and an expansion of our geographical operation we're now up to about 4,000 people in 31 countries >> and sir martin, as you look at 2021, what are you more optimistic about, that you can

capture more of the digital transformation that you're clearly well positioned for, or that 2021 will see a big pick-up in macro terms and add spending as we come out of the pandemic and hopefully have big events that we talked with you about and parties like the olympics like the soccer championships in the summer >> it's a bit depressing to talk about as i saw the prime minister has announced an even more serious lockdown in the uk. which is not good news until it sounds like the middle of february, so really bad news on that front, but having said that, i'm very much of the school that we'll see a rebound, a gdp rebound in2021 of about 5% to 6%, which counts as the 4% to 5% or maybe 5% to 6% decline that we saw in 2020. so the rebound driven by the events you mentioned, i don't know what's going to happen with tokyo '21 and euro '21, but i think we'll have tournaments of

a kind they might be a little bit more digital than historically so, but they will be events that will boost spending. but there is a tight correlation now between digital advertising spend and gdp. traditional ad spending continues to be under pressure, whether it's to networks from the streamers, traditional newspapers and magazines, you know, felling trees and distributing news print, or indeed, traditional outdoor billboard advertising, but traditional will continue to be under pressure, but we'll recover, i think, in '21 a little bit but digital, which is now over half of the market, the market is about $500, $550 billion, in 2021, and digital is about $250, $260 billion for the first time, it's around 50% and it's projected by analysts to go to about 70% of worldwide spend by 2024, so what coronavirus has done or the

pandemic has done is accelerated digital transformation, as you indicated, and it's really driven the share up of digital advertising, and we're reflecting that, and that excludes what we see going on in the other $500 billion of the addressable market in market research and public relations and indeed the $700 billion in trade budgets, primarily trade budgets. so overall, our market is $1.7 billion, and increasingly, $1.7 trillion, and increasingly driven by digital growth and digital transformation so we'll be doing more of the same, and we're seeing -- we saw growth last year, as an overall market, we reported the market the first nine months, we were up 15%, 16% in the first nine months at a time when the advertising industry was down by about 5%, 10%, 15% so we have done extremely well competitively, and that continues in q4, and we think the budgeting in 25% to 30%

organic growth as we go into 2021 >> where all the growth is, as you're projecting in the industry, where does social media fit in especially post crisis and into a year where the regulatory action, especially on social media names in the u.s., is becoming more uncertain and more bipartisan >> well, it goes with the territory. so a little bit like china bashing, it appears china bashing wins votes and it appears that tech regulation wins votes as well i'm not sure that it gets very far, and i think you have to be very careful what you wish for, sara i think that the tech platforms, particularly in a pandemic-driven world, people forget that over 165, $170 billion that google accounts for in ad revenues or $20 billion, i think amazon is up to now, out of that, a very significant

portion may be about 60% at least, comes from small businesses and medium sized businesses and regulating those platforms and making it more difficult, whether they're social or search platforms, making it more difficult for small businesses to navigate them, really hits hard at companies that provide significant employment opportunities for people in the economy. so i think it's a two-edged sword. we saw with gdpr and regulation in europe that introducing that did nothing but increase more prominently the position of the big tech platforms and discouraged the smaller and medium sized entrants in the tech platform area from coming into the market. i'm not sure government regulation gets you very far i think self-regulation does, and facebook has taken significant measures, for example, hiring 35,000 people, limiting advertising, as has google and twitter, and i think

they're showing greater restraint and constraining the privacy issues, interference in election issues and brand safety issues that a number of our clients are worried about. but boycotts don't work. i think working behind the scenes and explaining the position to the platforms is the way to go. >> sir martin, wanted to end with your view on how happy you are to do business in china today versus maybe a year or five years ago i'm sure you have seen the rumors or the stories asking where jack ma might be, and certainly seen the comedowns we have seen toward some of his entities and alipay and alibaba of late, is it a less comfortable place to do business thanit has been at any point i the last five years? >> depends whether your industry is a strategically important one or not we built a business which at its

height was about 20% market share. if you ask me what's top of my mind in terms of worries, apart from things like climate change and the equity inclusion and issues like that and obviously the pandemic, i would say the chinese/u.s. relationship is a real worry because like it or not, the chinese economy is likely to become the biggest economy in the world by size, not on a per capita basis, by what 2028 or so. the chinese economy has navigated the pandemic for whatever reason probably more effectively than any other major economy. growing this year, the last three years. just closed, and probably will participate significantly in that global rebound we were discussing so increasingly i think companies, like countries, are being forced to make a choice. i know it's fascinating that the

chinese signed up their eu trade agreement despite the fact that the secretary of state tweeted clearly, president-elect's administration, indicating they should wait, the eu should wait, but the eu signed up, and we have seen some sanctions or tariff increases from the u.s. in relation to the eu. these tensions are making it increasingly difficult one other point to mention, chinese millennials, if you study them closely, are becoming increasingly focused on china for china. so it's almost make china great again, and china was great 200 years ago, and the chinese believe they have been on the wrong side of history for the last couple hundred years and on the right side now i think it's very high up the list of concerns as to how you deal with both a big u.s. economy and a big chinese economy. we're in a position where i don't think our industry to date

has been that strategically important, but some of the things that you're pointing towards probably make it higher up the agenda than it has been before i think it's going to be very difficult for companies to navigate the two systems and i think the way to compete with china is to compete through innovation and investment and entrepreneurship, not through sanctions and trying to push back the tide. because it's inevitable that china continues to expand economically >> sir martin, great to see you. thanks for joining us. >> thank you happy new year, sara and wilfred. thank you. >> happy new year to you as well we have about 36 minutes left of trade. take a look at the major averages we're off session lows but looking at a sharp down day on wall street. dow down 478 points. earlier, we were down 724. that was after an nlsh surge at the open the s&p down 1.7%. all sectors are lower. real estate the hardest hit,

down 3%. up next, shares of alibaba moving lower today as those questions swirl as to whereabouts of founder jack ma we'll take you live to beijing for a report next. cost more.hares at $5 a slice, you could own ten companies for $50 instead of paying thousands. all commission free online. schwab stock slices: an easy way to start investing or to give the gift of stock ownership. schwab. own your tomorrow. you need to hire. i need indeed. indeed you do. the moment you sponsor a job on indeed you get a shortlist of quality candidates from a resume data base.

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dow down about 475 points. alibaba shares have been volatile ever since those reports hit than chinese officials were cracking down on the company, and now another mystery is emerging surrounding the whereabouts of founder jack

ma eunice unihas that story live for us in beijing. eunice >> thanks so much. jack ma has been noticeably silent after his high profile critical rebuke of chinese regulators back in october he was even a no-show for a television program that he himself had created which is an african version of "shark tank" so the company says that the executives were -- that he was swapped out for another executive at the company because of a scheduling conflict, but as you can imagine, his absence has been raising a lot of speculation as to exactly where he is. whether or not he's been disappeared by authorities, if he's fled the country, or perhaps just laying low. now, many people in tech still believe that the third option is probably the most likely, because from beijing's perspective, such a high profile detention would likely force other entrepreneurs to think twice as to whether or not they

want to be here, and it would come at a time when beijing wants to make sure that people believe that this environment is welcoming to private business. and then for jack ma himself, fleeing is seen as potentially a not very practical option as well, and that's because he has so many strong ties both business wise as well as personally to this country at the same time, guys, just the way that china operates and because of the low tolerance right now of the current administration to critical voices, nobody is ruling out the possibility that jack ma could either be on the run or that perhaps he has been detained >> so strange, eunice. i keep playing back that image of him dancing on alibaba's, i think it was their 18th anniversary, to michael jackson in costume on stage. he was so public is there a sense there for whether the regulatory action

and the pressure that he's facing now from the chinese government is personal because of the comments he said or is targeting alibaba and monopolies and financial and the companies and the sector >> well, the sense is that it's personal in that he is, as you mentioned, very outspoken up until these days he always is speaking his mind and so it was just seen as enough is enough you have been criticizing us all this time while making money the entire way and we just don't want to deal with this anymore. so in that way, it's personal. in terms of the impact on him, over and over in various conversations i have had, most people think that the companies are going to be affected and that he won't have his own, you know, personal downfall outside of business. >> eunice, thanks so much for that much appreciated >> time for a cnbc news update

with sue herera. >> hello good to see you. here's what's happening at this hour, everyone in wisconsin, prosecutors say a pharmacist who admitted destroying more than 500 doses of coronavirus vaccine did so because he believed the vaccine was not safe the statement came during a virtual hearing in the case which occurred earlier this afternoon. >> in california, investigators are looking into a christmas day covid outbreak in a hospital emergency room more than 40 health care workers have been infected, one of whom has died they're trying to determine whether the outbreak is tied to a staff member who briefly visited the e.r. in an air-powered costume that could have spread air droplets with the coronavirus. >> the u.s. chamber of commerce and the national association of manufacturers joining the list of organizations calling for congress to certify the electoral college vote, making joe biden the next president of the united states. more than 170 top ceos have

signed a similar letter, urging an orderly transition of power to president-elect biden you are up to date that's the news update i'll send it back to you >> thanks so much. >> still ahead, big tech stocks starting the year in the red after major gains in 2020. we'll speak with a hedge fund investor who says there's a new generation of tech names he likes more than the established faangs here's a check on the fields, mixed today. ten-year have been falling a fraction, now up a fraction. we're back in a couple minutes keeping your oysters business growing

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25 minutes before the bell, we have come well off of session lows we're down 435 on the dow, s&p down 1.6%. energy just popped into the green. all the rest of the sectors are down real estate, utilities and industrials are the worst performers russell down 1.4 nasdaq down 1.6. we're pulling off record highs we were just there this morning. >> quantum scape, one of the

hottest stocks of 2020 is getting crushed today on the first trading day of 2021. the ceo will be joining us later on in the show up next, though, moody's chief economist mark sazandi weighing in on the market selloff. we'll be right back. hey, dad! hey, son! no dad, it's a video call. you got to move the phone in front of you like..like it's a mirror, dad. you know? alright, okay. how's that? is that how you hold a mirror? [ding] power e*trade gives you an award-winning mobile app with powerful, easy-to-use tools and interactive charts to give you an edge, 24/7 support when you need it the most and $0 commissions for online u.s. listed stocks. don't get mad. get e*trade and start trading today.

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the close. all the major averages are selling off. we're down around 1.5%, at least the dow only off 1.4%. or 421 points. today's move comes amid rising concerns about the coronavirus cases ahead of tomorrow's georgia runoff elections for more on what all this is going to mean for the economic outlook, let's brin in mark zandi, chief economist at moody's analytics. the georgia runoffs are cited as a potential trigger. we're trying to figure out what kind of market it event it would be if we get a surprise.

the democrats flip the senate. would that alter the economic view at all? >> yeah, it would. i think it would mean that we would get a large fiscal package, another fiscal package through the democratic congress, probably some time in the summer you know, something along the lines of what vice president biden proposed in the campaign, building back better so infrastructure, education, health care, housing, child care, that kind of thing and some tax increases so to help pay for this increase in spending, that means higher corporate tax rates, means individual tax rates for high income households would rise, maybe an increase in the capital gains tax. so all those things become much more likely if the democrats win both those senate races and the congress becomes controlled by democrats. yeah >> how are those things, do you think, likely to be perceived by the market or even economists like yourself? is there such a thing as too much stimulus at a time where we're running record deficits

and there's increasing concern, potentially, about inflation and that massive debt load >> no, not when the economy is operating with a 6.7% unemployment rate. so that's very high unploempt. there's a lot of underemployment. we're a long way from getting back to anything we would be comfortable with, particularly for hard pressed lower income households that have been crushed by the pandemic. and also, obviously, interest rates at zero, the federal reserve is committed to keeping interest rates, short-term interest rates at zero until the economy is back to full employment with all of that as a backdrop, i think it makes a lot of sense to put your foot on the fiscal accelerator, try to get the economy back to full employment as fast as possible. once you get there, you have to pivot and start thinking about how to address the long-term fiscal issues. in terms of markets, for the stock markets, it's probably mixed because equity investors will like the stronger growth.

that means more corporate profits. but they certainly won't like the higher tax rates net of all that is probably a wash for bond investors, it probably means higher interest rates. today's actions, stock prices are down, but bond yields are basically flat i doubt today's action is related to any significant degree to what's going on in the georgia races. >> what portion of the population needs to be vaccinated to have a meaningful boost to the economy when do you expect that to be achieved by? >> wilfred, i say about half and you know, the consensus view and probably what's embedded in markets is half the american population will be vaccinated by midyear, let's say by july 4th and if it looks like that's not going to happen, i think, you know, investors will become uncomfortable with that because it's not good for the economy. given the rise in infections and hospitalizations, deaths, and this recent strain in the uk which is causes the british to

shut down schools, i mean, if that comes here to any significant degree, and that will create a lot of problems for the economy, so the quicker we get these vaccinations, the more likely the economy will be able to kick into gear i think at this point i'm expecting about half the population to be inoculated by the middle of the year if we're slow, at the current point in time, i think we'll gear it up and the bidenstration will bring in professional management and get it done >> thanks for joining us much appreciated >> when we come back, one vaccine stock gets a big boost, and competition in the ev space revs up. those stories and many more when we take you inside the market zone next as a reminder, you can watch or listen to us live on the go on the cnbc app we're down 1.3% on the dow 17 minutes left. through the year 2021. - i knew snhu was the place for me

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investing. banking. guidance. we have 13 minutes left in the trading day. now in the closing bell market zone commercial free action until the close. mike santoli here to break down the crucial moments of trading day, and we have keith with us as well. let's kick things off with the market stocks tumbling to kick off 2021 after the dow and s&p 500 hit new intraday highs earlier this morning. the dow and s&p on pace for their worst one-day drop in more than two months. s&p off 4%, the dow currently down about 385 mike, energy is just positive as

we speak but otherwise, it's quite an interesting makeup to what's been selling quite broad as opposed to whether the rotation is either on or reversing. i yeah, exactly. pretty much a skimming off the top of some of the recent gains. the stuff that was up the most in the past quarter and the past year seems to have more room on the downside today, so it does argue for the idea that people pushed some of their pent-up gains into this year, maybe doing some trimming. i don't think it changes much of the overall story, for the last month or so, there s&p has been around 3700 plus or minus a little bit, so we're still in the range. we have been able to say for weeks the market looked a little overbought, a little overloved and maybe there was complacency in the strength of the seasonal strength, but nothing today really changes too much of that, except it does perhaps create a little bit of a gut check to see if people really can stomach just a little bit of turbulence. >> keith, you have been on with us for the last few months liking the market. very constructive on stocks.

has anything changed for you as we head into the new year? >> no, not a all well, ask me on wednesday. because i do think the georgia senate runoff elections will have an impact, at least in the short term on the market but overall, fundamentally, no i continue to believe and look at all the data and all the different various markets around the globe, and the best place to put risk capital to work is right now in the u.s. equities and that has not changed at all. >> let's talk dollar for a moment kicking off 2021, doing what it did for pretty much most of 2020, which is falling it's trading near its mid-2018 lows why? well, generally bullish sentiment has been boosting stocks lately. riskier currencies like emerging markets, especially chinese yuan, add to that massive fiscal and monetary stimulus, massive deficits, and there's more reasons to sell the dollar it's also driving the bust on all sorts of other assets that

typically move in opposite directions pick a commodity, wheat, soybeans, corn, gold, silver, they're trading at multi-year highs, all priced in dollars even bitcoin is considered tied in an opposite direction to the dollar, and stocks as well the question is, will it continue while the one-two powerful punch of stimulus and low rates and vaccines should boost global growth and underpins this big selloff, there are a few things to consider. number one, everybody is betting against it right now net short futures positions are at the highest level they have been in in years since 2011, meaning it's crowded could snap back fast and hard. there's also the georgia short-term runoff factor strategists like jpmorgan say if the democrats take both senate battles, the dollar could fall harder on further stimulus prospects. this is going to be a big help either way for companies over the next few quarters that do business overseas and for u.s. exports, which should help the u.s. recover

one reason it has helped stocks but, guys, it is a big risk factor, if it does snap the other way, just because it's been such a massively overcrowded position, if the dollar starts to strengthen, which would go against so much of the consensus forecast, how much of a bearrier do you thing it would be for stocks climb sng. >> there's room for a bounce so i don't think it's necessarily a hair trigger, but i see it all kind of as one harmonious trade, in other words, i don't know if it would be the dollar rising and everybody being caught by surprise because they were gorging or risk. i think the dollar would be rising because in general people were backing off of this sort of risk seeking behavior, maybe having some perception that liquidity is going to be not quite so generous down the road. the one other factor that's been interesting is there's been this massive record trade deficit in the u.s. in goods. we import most of the stuff we buy, and it's been a massive spending binge in goods as

opposed to services. if that swings back, then maybe that's one pressure point on the dollar that gets relieved. so i do think it's sort of a good tell in terms of just the aggregate global risk appetite and maybe some swingback in sort of the trade balance over the coming year. >> keith, of course, dollar weakness is seen as good for risk assets. that said, if we do see more dollar weakness, it may also be because of or at the same time of rates rising. and is there a key level you look at rates that starts to damage the equity markets? >> yeah, i really don't see any level right now, not even paying attention to that as it relates to the dollar because i just don't see that back of 100 basis points anytime soon, and you heard charles evans speak today, where he was talking about the real pressure that the fed is on they just cannot stick some inflation in the u.s. economy. he doesn't see that coming any time soon. i'm not sure it's going to put

pressure on, it won't be the pressure to put the pressure on the dollar but the dollar is near what we would consider a buy point, on the dxy, and as sara pointed out, the weak dollar is very concerning for the larger indexes and the equity markets because the big companies, multinationals who benefit from that, but i would expect a bounce but as long as the weak dollar is in our midst, i think that will put support on u.s. equities and if it stays down there, u.s. equities should see more capital influence >> let's turn to tesla that company falling just shy of its 2020 delivery goals but moving high to start the year. phil lebeau has more for us. >> the stock is moving higher in part because when you look at these numbers it's clear there's strong underlying demand for tesla vehicles the fourth quarter deliveries came in at just over 180,000 by the way, that's a record quarterly delivery number for

tesla. 90% of them being model 3 or the model y. for all of 2020, they came in at 499,550 vehicles technically, that's just shy of the guidance the company gave of delivering at least a half million vehicles last year let's be clear, though, they fell shy by less than one tenth of 1%. they essentially met guidance. they delivery consensus for 2021 right now, most analysts believe they will deliver as least 780,000 vehicles one other electric vehicle company getting attention today, chinese electric vehicle company neo. stock moving higher as they reported deliveries doubled year over year in 2020, but they're at a far lower volume than tesla, delivering just over 343 vehicles last year >> thanks so much for that mike, regardless of decent news flow and data points over the weekend, quite impressive to see tesla up 3% today in light of

clearly a lot of selling on wall street >> right, which just tells you it's not principally about the numbers. how many times was the stock going to price in half a million deliveries in 2021 it's been the premise for months and months how many times did the stock price in the fact it was going into the s&p it's its own thing it's driven by its own fuel source, so to speak, and it's driven by much more about the long term picture of, you know, countries banning fossil fuel powered cars in coming years and how much tesla is going to get of that market i think we have to kind of disengage ourselves from the here and now in terms of what tesla is delivering and how the stock is behaving and what it's valued for >> let's talk about vaccines the uk beginning the rollout of the oxford astrazeneca vaccine as the u.s. continues to lag its own vaccination targets. meg tirrell with the latest for us meg. >> hey, sara this, the second vaccine to be

rolled out in the uk, about half a million doses expected to be available there of the oxford astrazeneca vaccine this week. this as the uk just announcing that lockdown plan they say that they expect if things go well, to be able to give at least the first dose of these two-shot vaccinations to everybody in the top four priority groups in the uk by mid-february so as they're starting to think about lifting that lockdown in that country now, they point out that they have vaccinated more people than the rest of europe combined at this point here in the u.s., things are behind schedule. we just got updated numbers from the cdc showing that just less than 30% of the doses that have been distributed, about 15.4 million at this point, have actually been administered 4.6 million people have received their first dose now, people are starting to get their second shot of the pfizer vaccine today as the vaccinations began three weeks ago. so the cdc data are typically a

few days behind. so we should see those numbers increasing at the same time, guys, there's been a lot of discussion about how to increase supply in the uk, they have been talking about spacing the first dosesory the first and second doses of both the pfizer and astrazeneca vaccine out to as long as 12 weeks apart in order to make sure there's more first doses to go around that is not something that health officials here in the united states are talking abouting to. they're talking about potentially looking at half -- >> doses of the moderna vaccine. moncef slaoui says a half dose was shown to give the same immune dose as the 100 microgram dose which is now on the market, so all of these things being considered, but the most immediate issue is picking up the pace of the vaccinations guys >> it's all such an experiment, meg. and i get the point about needing to increase supply, but what about using the supply we already have in the u.s. how do we get it into more

people's arms faster what are the best ideas? and is anyone actually doing it so that we can get it done faster >> yeah, the cdc has state by state data showing the pickup in each state and how much of the populations has been able to be covered. connecticut is one state that has been able to use a significant proportion of the doses it's been allocated. what is different about some states versus others i mean, it could be organization, it could be funding. part of it is that some doses have been saved for long-term care facilities so we should start to see the pace of vaccinations pick up, but it's a rockier start than many hopes for. >> meg tirrell, thank you very much >> we're about two minutes left to go in the trading day zee we have come back a lot. dow only down 376. we were down by 700 at one point. >> apparently, a fair amount of buying set up on the market on close orders but looking at the internals,

not as weak as you would expect on the new york stock exchange split of up versus down volume les than two to one to the down side considering we had a significant drawdown in the s&p. the nasdaq volume is positive. look at growth versus volume it underscores the idea this is not thematic, not in response to fundamental expectations s&p and growth value neck and neck all day this isn't about expectations changing over the macro, and then the volatility index, we talked about it earlier. it had a pop it seems very twitchy. we're down off the highs, a little over 27, and it shows you people are on guard for something. maybe any kind of further pressure would not come as a surpris surprise >> just under one minute left. thanks, mike quite a lot of intraday turnarounds in the u.s., including the dollar, which started weak, ends the day essentially flat, having recovered intraday oil down 2.5%. gold is up nearly 3%

silver also having a strong session. as for the equities, opened at highs, steadily sold off through the morning. where a little bit of a bounce this afternoon the dow is down 400. the low is down just over 700. down 1.3%. s&p down 1.5% as is the nasdaq 10 of the 11 sectors are lower, led lower by real estate, industrials, utilities, and technology one sector, energy, with a fractional gain. at the close, s&p down 1.46% >> and that will be the first negative start to the year for the dow since 2016 have not seen that in recent years. welcome back to "closing bell. i'm sara eisen here with wilfred frost and mike santoli take a look at how we finished the day on wall street the dow ultimately closed below by 382 points. we climbed a little back from the lows especially in the final hour of trade. we got down to down 724 on the dow after hitting a high at the

open the s&p closing down 1.5%. worst day for the s&p since october 28th so more than two months. we saw all sectors closing negative, except for energy. energy just popped into positive in the final moment of trade real estate the hardest hit, down 3.3%. utilities and industrials also lagging. nasdaq closing down 1.5%, and the russell 2,000 also closing lower by about 1.5%. keep in mind, all of these major averages were coming off record highs. and a very strong run off those march lows shares of quantumscape cratering today. one of the hottest stocks of 2020 when it went public in november lost a good chunk of its value last i lookd, down 40% or so coming up, the ceo of the electric vehicle battery maker joins us to discuss today's move >> plus, the bitcoin bonanza, the cryptocurrency falling after

a record breaking rally. we'll do a deep dive into how retail investors and wealthy investors are using this trend >> plus, keith bliss is still with us, phil cap arely joins the conversation welcome to you, phil first, i'll send it to you, mike, on what you made of this, how much damage was done, and what the catalyst was. >> not too much lasting damage, i don't think. we have been bumping around these areas for a while. we did actually have kind of a levitation at the close on thursday and that's about half of what we lost today so i don't think it will necessarily change the story which is the market looks like it probably could run into some fatigue right here a lot of these technical indicators showing maybe some exhaustion in this rally that's been going for a while, but overall, nothing too much has changed. i don't see much in the way of a specific catalyst except for the fact the turn of the year created this excuse for people to start to take gains that had built up last year and you're

out of that strong december period that makes it seem like it's a little bit more of an even risk reward as opposed to fighting the upward trend. i don't think it changed too much we closed exactly on 3700, the s&p, where we have been hanging for about a month. >> keith, 3700, as mike said, where we closed. you're ultimately positive on stocks but with some short term caution. what number on the s&p would make you bullish in an unrestrained fashion and be a clear buyer. >> today, we see buying opportunities, extreme buying opportunities on that low. the dow, the vix would be a sell around 3150 or so if it gets to that number. but more importantly, it underscored what mike mentioned, you can't really cite a catalyst today on the move. i think the market has become so conditioned to the market

continuing to bleed up or grind up or melt up, whatever your term you want to use, and you have a down day like this, especially on an unusual day, the first trading day of the year, then people get a little excited. i think it's way too early to tell what's going to happen in the market i think the elections will have some impact on the markets and the covid, the slowness of pace of the covid inoculation rollout will have some impact on the market as well unless we pick that up, because we do expect a spike in cases post christmas as people got together for gatherings, no matter what the protocols were so until we get those things sorted out, we'll see choppy sessions in the market, but hopefully we'll get clarity after the tuesday elections and hopefully the bureaucracy can get out of the way and start rolling out the vaccine. >> we'll talk about tomorrow's election in just a moment, but phil, wanted to turn to you on that question, you know, days like today, you hear people louder talk about stretch

valuations and euphoric sentiment and positioning, everybody being on one side of the trade. how would you assess those factors right now, and what does it mean for the coming action? >> sure, first thing i would ask, are they talking about the fixed income market or the equity market, sara, and happy new year we're coming off 2020, 2020 went down as the second most volatile year since 1930 other than 2008. lots of noise in the market. what we would say is we like the market for three different reasons. first, the technical story we do not expect a repeat of volatility from last year. if volatility were to normalize based on really strong guidance from policymakers, that's a positive sign for taking any risk, whether it be credit or equities the second thing is fundamentals we're looking at a consumer that is just fine actually, pretty good because of how low interest rates are that are going to be unleashed in pent-up demand, we think, in

2021 and the third thing, to your point, are valuations. the valuations right now if you look at the s&p 500 trading at 21 times earnings and looking at a ten-year treasury that's trading below 1%, it's the ten-year treasury that's expensive. not the s&p 500. and forget about cash. if you want to sit in cash, and just bleed negative carry every day, that's really the expensive trade. so we would say on a valuation perspective, valuations are just fine as long as rates stay this low. and you have a really, really supportive policy backdrop with fiscal and monetary policy, sara, being double of what it was in 2008 at a time when the consumer is just fine. this is a really, really good environment for taking risk in our opinion in both equities and credit, not just an equity story. >> mike, pretty much everything intraday had a turnaround theme to it. apart from gold. what do you make of that move, silver as well, open just held

on to those gains throughout the session? >> very interesting. i almost wonder if they're trading slightly inverse to bitcoin a little bit, if bitcoin, the whole story is the newed gold, if it's backing off if we get into the metals. metals in general and commodities in general have held up better today as opposed to, you know, the softer stuff, the intellectual property stuff. it could just be that. i'm not sure if there's a particular tell in terms of the precious metals. >> let's get an update on what we can expect in the georgia runoff election. ylan mui has that for us, as always >> well, wilfred, the heavy hitters are coming out today on both sides president-elect joe biden about to appear at a drive-in rally in atlanta in support of the democratic candidates jon ossoff and rafael warnock and then president trump will hold a rally of his own to help out the gop incumbent senators david perdue and kelly loeffler. already the early vote total is

more than 3 million. but there is some nervousness amongst republicans about turnout, especially given the president's repeated attacks on the integrity of the election process in georgia today, state officials tried to assure the public that every vote will count. >> there are people who fought and died and marched and prayed and voted to get the right to vote throwing it away because you have some feeling that may not matter is self destructive ultimately, and a self fulfilling prophecy in the end >> now, together, these races are just shattering records for the amount of money raised and spent in just the past two months, guys, nearly $500 million has gone toward advertising alone, and that just gives you a sense of how high the stakes are here. >> thanks so much for that and wall street of course closely watching the georgia senate races oppenheimer estimating a democratic sweep may cause broad markets to fall between 6% and

10%. they predict a powerful market rotation if democrats win with investors shifting focus to higher regulation and green investments. on the flipside, stifel sees gridlock in washington, no matter the outcome, which the firm says is generally positive for the markets. mike, what's the consensus if we get that result of democrats seizing control of the senate? we talked to mark zandi earlier. more stimulus perhaps on one side upset by potentially more taxes. does it net out or in the shortterm, would there be a pullback >> it's not clear it would be the genuine cause of a pullback. could it be the excuse perhaps. i come from the premise where electoral politics is almost always somewhat overplayed as a factor, as an enduring factor in terms of what the market does. it's hard to get away from the idea that no matter what the result is in georgia, you'll still have most of the swing factor power in the most moderate senators.

it's 51/50 is not exactly a way you can bulldoze through things like big tax hikes i don't know that necessarily you could confidently say yes, there could be an excuse for a pullback, a big pullback, if you got a democratic sweep tomorrow. >> what about sectors, phil? would you invest differently would you choose different sectors if the government was controlled fully by democrats, electric vehicle makers, other sort of climate friendly stocks, maybe cannabis stocks? i don't know, what comes to mind >> yeah, so sara, that's a good question we would agree more with mike on kind of the outcome here this is a really, really small majority either way you look at it, so i don't think it has powerful sector rotation impacts, sara. at the end of the day, one of the things that really struck us with the biden administration actually, that went really underreported in november, was his choice of chair woman yellen for secretary of treasury.

that would allay a lot of fears of wall street, someone who is very well respected and known by investors, and that's the kind of cabinet he's putting together irrespective of who wins in georgia tomorrow we would agree he's looking to placate more of the moderates than align himself with the more progressive side of the party. >> you must not have been watching cnbc, phil, because that was not underreported we were all over that. >> i just mean in terms of the vaccination and the election news i think that was really, really good news from a mark row perspective. >> got it. i thought you were saying yellen phil, thanks keith, thanks to you as well we appreciate it check out quantumscape if you didn't see the stock today, it closed down 41%. worst day ever the ceo of electric vehicle battery maker will join us exclusively to discuss the move after this quick break, and

later, emj founder eric jackson tlesree sees opportunity in his search for the next gen faang stocks. we're back in ninety seconds on closing bell make fitness routine with pure protein. high protein. low sugar. tastes great! high protein. low sugar. so good. high protein. low sugar. mmm, birthday cake. try pure protein shakes. with vitamins and minerals for immune support.

>> shares of quantumscape plunging, falling nearly 41% the stock was a big standout of 2020, surging after going public via spac in late november.

phil lebeau joins us with quantumscape's ceo for an exclusive interview. >> thank you very much jagdeep, let's begin with the question i think a lot of investors have today you're down more than 40% today alone, more than 50% over the last four trading sessions can you explain why investors have said sell quantumscape right now? >> yeah, so as we said in the past, we really can't, you know, predict short-term stock market volatility nothing has changed about the business everything is exactly where it was four days ago. four weeks ago, for that matter. we shared with the world some pretty remarkable results in our battery state. what is -- what did happen last week is we issued, we filed an s-1 with the s.e.c. that was declared effective as of thursday the s-1 basically was an importance with what we disclosed in our s-4 and the

documents relating to registering the shares that we had sold in the pipe offering we did as well as the spac merger so that's something that was already in the works, and it was already disclosed. but again, nothing about the business has changed there are no lock-ups that have expired. everybody is still locked up in the way they're supposed to be there's no warrants being emphasized or sold in terms of the warrants that are affiliated with the spacs in our view, we obviously can't predict short-term stock market behavior, but at the end of the day, supply and demand have to come into balance, which might be what might be happening here. i will say that from our standpoint, we continue to believe as we have in the past that if we can deliver this technology and get real cars on

real roads, we will create a tremendous amount of value for all of our investors while at the same time making a real impact on the climate. so that's really all the same. >> sure, but jagdeep, you know the skeptics out there are looking at your company and saying you're not going to have a production ready battery until 2024 you might have toyota introducing a solid state battery perhaps by the end of this year. who knows when production might start with that battery, and the cynics out there are looking at your company and saying, yeah, on paper, the science makes sense. in reality, we're not quite sure that these guys can get up to scale in terms of what's needed for evvolkswagen >> i think we were pretty transparent about what we had and what needed to be done what we have shown is the best data that in our view anybody in the industry has shown you mentioned toyota

we haven't see any data from them it's publicly believed they're working on a sulfide system, which is a fatal flaw. we'll wait for them to show data and make an assessment then, but none of that is new. from our standpoint, everything you described, there is certainly work to be done. you know, asking questions about how much work there is to be done, but all that really has already been out there, and we have been transparent about what needs to be done we have never tried to predict stock market short term behavior all we can say is this is a massive, massive opportunity it's a multi hundred billion dollar a year opportunity for whoever wins the battery technology race here, and we have something, a solid state system that delivers performance, really record-breaking not only in comparison to other solid state efforts but even in comparison

to lithium ion conventional technology if we can get this to the market, which is the task we're focused on, ramping umproduction, making the multilayer cells, we believe wewe could get a big share of the market, and if we can do that n vestors will be well taken care of that's all we can control, the long term value creation we think the best way for us to serve our investors is to stay focused on that long term. you know, we just can't really, you know, i don't think anybody can predict the short term market behavior. and so we are not going to even try to predict what happens in the near term. >> but as investors are trying to figure out the long term here, jagdeep, how do you see the hurdles to mass manufacturing these batteries? how big are they and what are they can you lay them out for investor snz. >> sure, happy to do that. we have said there are a couple specific things we need to do. the data we showed last month was pretty remarkable in terms

of cycle life and temperature performance and rate performance and so on. but it was all based on single layer cells and we obviously made it clear in our presentation, you know, so one of the tasks is we have to take the single layer cells and stack them up into a multilayer stack. that we believe is engineering, and then the second key task beyond that is scale up in factories which i don't want to minimize how much work is to to scale up a lithium metal battery factory, but i will say that people have built lithium ion battery factories before that's not a task that requires new physics. nobody, however, had shown in the last 45 years of work a lithium metal solid state battery, so relative to the scale of those two tasks in our view, solving the dendrite problem is a much bigger sort of a win.

and while there's a tremendous amount of work to be done building factories, factories can be built and what we need is the right expertise, which we believe we have we have the capitalization and now a public offering, we have work ahead of us and we're focused on that work and we believe if we can execute on that, we can create a lot of value. i think, again, the main point i think i'll make is the only thing we can control is long term value creation, and the way we do that is by taking this technology which we have demonstrated the promise of, and actually delivering it in real batteries that go into real cars on real roads. we have the world's largest car company, volkswagen, as a big investor and partner, and they're committed to deploying this technology. at this point we believe the ball is in our hands and we can certainly fumble it, no question about it investors are aware of that, there's never any guarantee about the future, but if we can execute on the opportunity that we have ahead of us, we feel

like investors will be well serv served, customers will be well served and environment will be well served. >> with that in mind, do you regret in any way going public the way you did, via spac, with the field you operating in late last year when the market was attracting a lot of attention. your share price is higher today than it was on that date, though some people will have been hurt quite significantly by the last couple days of share price performance. do you wish at all you had gone public at a different time in a different way and just focused on the job at hand rather than having to come on and answer questions like this from me? >> well, i'll be honest with you. i think that if what's causing the stock market, you know, behavior today is related to the registration of the pipe investment shares that happened last week, you know, that's the kind of thing that would have happened even in a regular ipo, when you sell shares on an ipo, you have new shares that come on the market and those shares will

affect the balance of supply and demand i think the more important thing for us, from our standpoint, was to get the capitalization we needed, to build the billion dollar sheet, coupled with the customer demand we know we have with vw, and putting those three pieces together into an execution plan to allow this to happen if we had not raised that ability on our balance sheet, we would not have been in the position that we are in today relative to our ability to execute, so i think i'm comfortable with that decision and i think it was the right call to make, and our view is in the fullness of time, if we can execute, that investors will in fact have a great return on the investment they made >> okay, thanks so much for joining us today, jagdeep. much appreciated j unp next, we're talking tech emfoder eric jackson weighs in on where he sees opportunity

in the new year and the names that could see big returns closing bell back in a couple minutes. students reach their goals. as a nonprofit university, we believe access to high quality education should be available to everyone. that's why we offer some of the lowest tuition rates in the nation, and haven't raised tuition in nearly a decade. so no matter where you want to go, snhu can help you get there. visit snhu.edu today.

welcome back all of the major averages

closing lower in the first trading day of the year. tech among the biggest sector losers some of the group's biggest laggards include the faang stocks all closer lower by 1%. let's bring in eric jackson. good to see you as always. thanks for joining us. >> thanks, wilfred >> my first question is a broad one about tech valuations. both in the public and the private market do you think that they will be the multiples, negatively correlated with rates, if rates do rise over the next year >> yeah, no question historically that a rising interest rate environment will depress the multiples of the tech stocks. however, one of the situation that we're in now is obviously rates aren't rising, they're probably not going to be rising for a while. in the dotcom period, rates were steadily rising yet valuations were continuing to go on to egregious levels

although a lot of people talk about there being a bubble now, i don't think that we're there i think that we have all the makings to eventually one day see a big bubble burst, but i'm hoping that we're still in the 1995-'96 period and we have several more years of solid growth ahead of us >> gauge for us how good the next year or two could be. as i understand it from sources close to your firm, your fund was up 145% last year. will that be repeated? >> well, i think the conditions are excellent still for tech stocks obviously, today, you know, it's raining. it's pouring outside there's all this thrashing about and concern about politics and what's going to happen tomorrow. but i think taking a step back and looking longer term in 2021, we have this kind of slow growth environment, an accommodative fed. typically, those are great conditions for stocks and stocks can continue to work for not just this year but into next

year so i think there are still a lot of opportunities some folks like to portray it as all of last year's growth was driven by a very small set of faang stocks i just think that's demonstrably untrue and there were tons of small growth stocks that had amazing years last year. i was fortunate to flag several of them and buy them throughout the year, and i am continuing to look for those next gen faang stocks that are still at the beginning of their growth. >> we'll just add to your cred you gave us hello fresh back at the end of october that stock is up about 40% since then where are those next gen faang stock opportunities right now, eric >> three of my favorite, sara, for 2021, zillow, which is revolutionizing real estate, online real estate they're obviously making a big push into something called i-buying, buying and selling your own online. if investors ever wake up and

start valuing the part of zillow's business the way they're currently valuing a company like car vaughnvana thil go over $200 a share this year second big favorite is match you know, which owns tinder, obviously. i think one of the most unsung stories for match last year was that they hired a guy named jim who i have known for several years. he most recently came from cvs where he ran the streaming side of cvs before that, he worked at a bunch of internet startups in the valley the thing people i don't think appreciate about jim is he's an amazing product manager. he eats, breathes, and sleeps product. he builds great teams. i think tinder is going to surprise big time this year. to the upside with new product innovations growth and then the final company that i flag is my favorite ipo of 2020, it doesn't get all the attention of some of the big names, but it's a company called upstart. it was started eight years ago

by a guy named dave gerard he used to run google enterprise it's the real deal when it comes to using artificial intelligence to basically improve finance scores, better consumers they are already 5% market share in that space. they're just getting into auto loans. when they get to mortgages as well and matching people there, to the right banks and offers, i think it's going to be 11 times its current size that's a company i'm holding for the next ten years >> i mean the common thread from all of these names is they have all actually been up really big, and especially if you zero in on match and zillow, eric, it's hard to see how the housing market could get better from these levels we have already had for zillow, and hard to see how online dating could get stronger from the dengpths of the pandemc so why do you think there's

still potential? >> one of the things i found, sara, is often the companies that, i like to think are these next gen faang stories, they can wildly outperform my even most optimistic blue sky targets. when i got into twillio in february of 2018 when it was a $2 stock left in the dust bin by a lot of investors, i thought two years occupant, three years out, he was going to be $150, $180 here it is today around $340 now. these growth stories can have a lot of legs, especially for category leaders which zillow, match, and upstart all are >> eric jackson, thank you we'll track the performance, as always we appreciate it >> thank you bitcoin taking a breather today, but it has been skyrocketing over the past year. and just over the last weekend find out if more institutional

investors diving in will help sustain the rally, when "closing bell" comes right back

volatile day for bitcoin, plunging earlier today by 15%. right now, down about 5.25%. follows a record setting weekend where prices topped $34,000. just about $31,000 right now joining us, jj kina han, and alley mccartney.

ally, always love to hear from you what your wealthy and sophisticated investors are doing. how much interest is there right now in bitcoin, and what are you telling them to do about allocation >> there's a lot of invest, and there has been a lot of interest for a significant amount of time remember, a lot of very wealthy individuals, even those that have made their money in very traditional finance sources, take risks and they understand the concept of taking risk now, the weird thing about this is you're talking about sort of a means of exchange of currency, which exactly opposite of a normal currency, doesn't have the ability to pay your taxes and has at this point very limited demand but unlimited supply i think the thing is that individuals that act like institutions, ie not retail individuals, are getting in now as in asset allocation play, and that i think is why you see such a run-up, is you're having some really big buys.

>> what about you, jj? have you guys had to expand your offerings in the space at td ameritrade for retail investors? >> you know, sara, we don't have bitcoin itself, but the products we do have, including bitcoin futures, we see 150% lift there. some of the names like grayscale bitcoin trust, we see 170% quarter over quarter growth. then you have things like msti, which in august invested so much money in bitcoin, quarter over quarter, we see a 1400% lift in the amount of trading and positions held there so what's really interesting to me about bitcoin maybe more than any other product i have seen is the fact of how many people become more interested as the price goes higher. i guess that makes sense, of course, but the amount of people we see that really have interest as it starts to get -- starts at the 10,000, then over 20,000, we really saw a flood of people

become much more interested in it than we had seen at any other time before this >> when you speak to your clients about bitcoin, do you get a sense of what they wanted in their portfolio for is it to go alongside their most risky bets like tesla and zoom, or is it something that they see as a potential hedge to equities and something that they want to buy in place of their bonds? >> yeah, i think to a certain extent it's been a moving target the story of the first couple years is here was a store value that was apolitical and could be a diversifier. then you fast forward and to my colleague's point, you see the numbers going up, which always gets people interested you see the adoption in the form of bloomberg galaxy index, then fidelity being a custodian, now paypal letting you buy and sell with it. adoption is going up, price is going up, and the lack of available alternatives in the market in terms of being

diversifiers, bonds have largely gone out the window in terms of relative risk return, so i think all three of those, and once you see the credentialing mechanisms of large pension funds and sovereign entities which you have just seen major buying which i think is what has taken this from $25,000 up to where it was this weekend, you start to really get some credentialing mechanisms, and by the way, unlike a retail investor, the assumption there is these aren't speculators, these are long-term buy and holds that can create some sort of substantive floor for the currency >> how does it correspond overall, jj, with the mood and the appetite for taking on risk from retail investors right now, whether it's stocks, tech stocks in particular, how closely is it tied >> well, i think the bigger thing for this that we really try teej kate people on overall, sara, is the fact that it trades nonstop. it keeps going

alli just got done talking about trading this weekend that's a big step for many people what is interesting and alli brought up a good point there, we also see a lot of our overskewed investors who want to be involved there. i think there's this sort of narrative out there that it's only young people who care about this we have actually seen a very nice mix in terms of the ages that are attracted to the products that are related to bitcoin. and i think that's very important. so you do have people who are using it obviously speculatively, and you have people who have it as core of their portfolio, maybe not as big of a percentage as fixed incomes or something like that, but there are people who are starting to add it more to their portfolio so it started to become more and more of an accepted asset base. >> jj and alli, thank you both for joining us >> take care >> happy new year. >> still to come, the battle over boeing, the stock leading the declines on the dow today, but should you buy the dip

we'll speak with two analysts with opposing views on the stock. that's coming up next. cyber attacks are relentlessly advancing.

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where sue herera >> here's what's happening at this hour. andrew cuomo says the more contagious uk variant of the coronavirus has been found in the upstate town of saratoga cuomo says the infected man has not traveled, suggesting community infection is already taking place >> in the uk, record covid spread between the new variant has prime minister boris johnson implementing new restrictions. they will be in effect until at least mid-february >> with most of the country already under extreme measures, it's clear that we need to do more together to bring this new variant under control while our vaccines are rolled out. in england, we must therefore go into a national lockdown which is tough enough to contain this variant. >> and back here in the u.s., the state department is calling on iran to immediately release the south korean flagged oil

tanker that it has seized. the state department is also accusing iran of, quote, nuclear extortion. with the expansion of its uranium enrichment program you're up to date. sara, back to you. >> sue, thank you. straight ahead on the show, shares of boeing down around 40% since this time last year. we're going to datwhebe ether you should be in this stock in 2021 next on "closing bell," and you can always watch or listen to us live on the go on the cnbc app. we'll be right back. ♪ ♪ digital transformation has failed to take off. because it hasn't removed the endless mundane work we all hate. ♪ ♪

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up next, two analysts with two very different takes on boeing they'll debate whether you should buy or sell the aerospace giant when "closing bell" returns. sitting on this couch so long made me want to make some changes... starting with this couch. yeah, i need a house with a different view. and this is the bank that will help you do it all. because at u.s. bank, our people are dedicated to turning your new inspiration into your next pursuit.

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shares of boeing down more than 5% after a 20% run in as vaccine roll out goes slower than expected how will it effect boeing's recovery. now joining us our guests calling the company a fresh pick good afternoon thanks for 1y0i7bing us. s joining us douglas what's your reason to down grade the under perform today. not because of the 737 but because of the 787 >> yeah, well, thank you i think it's useful to look at where we were before today which, as we were looking at

recovery trade here which we seen the stock up 20% recently, it went up 20% approximately the first two weeks of november. we had high efficacy vaccines demonstrated was very appropriate, a surprise went up another ten percent on the max but should are been no we think the max is a good airplane and will be back and be competitive and look for the delivery on that so that was fine and there was new orders but those were also known so it gave back that 10% that's where that 20% came from. but this recovery is not like other areas. because you can't just flip a switch like in potentially in some travel-related sectors. it's going to stake some time. that's why before we did the

down grade today we felt boeing was fairly priced. what changed for us is the situation with the 787 back in august, eight airplanes were grounded and boeing does did this, there was no safety or flight issue but had to do with non-conformity of the structure of the fuselage and said q4 will be a big quarter because we've been holding about back as we're inspecting these airplanes, what happens, it's not going to be a big quarter. they delivered four in october they delivered none in 23406 it -- in november. and one in december. so the fact is, the problems appear to us to have gotten more extensive related to the structure. and there are month or are and there are more areas of nonconformities that will have to be addressed.

now we're at a point some of those airplanes that were to be delivered in the summer, as we understand it some may be delayed more than 12 or even 15 months once you do all the that, you set yourself up for a very significant cash issue over the next 15 months it's a cash issue that boeing seems to have been very concerned about, even though they have quite a bit of cash on the balance sheet more than $27 billion at the end of q3 it's been this cash hit related to the 787 that took us from a situation where the price was fairly valuable in boeing to one we think the market fully appreciated via the new issue. >> so peter, want to get you in on this conversation and opposing view why after what, more than 125% rally off the march lows boeing deserves, in your view, to go higher. >> yeah, well, i appreciate you

forfe fitting in, sarah, on that i think doug, i think, recognizes that there's a lot of value here that was, you know, pulled off the table when boeing 747, you know, we sa when boeing, you know, we saw the max grounded, the max is 70% of delivery volume at boeing it's a big deal for that to come back and we expect it to ramp up materially as we exit 2021 i do recognize there's a lot of inspection activity going on in 787 but we feel very confident that the vaccines, as they roll out that air travel will snap back air travel from the leisure side expected back to 60% it in 2021 business will still lag but it will be a phase recovery into 2022 we have modelled no wide body recovery in the 777 forecast and recognize the cash flow

dynamics in play boeing had enterprise value over $250 billion, at its peak today the number is down close to 45% so the free cash flow outlook is down by 50% so we think the stock is around levels where it maybe should be and we think it is going to get better as we move forward and the good news continues to ramp up on the max delivery >> we will leave it there. you heard both arguments douglas and peter, thank you for joining us, boeing the biggest lager in the dow today up next, "closing bell" will be right back.

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. welcome back stock finish the worse day of trading in just over two months. october 28th, haven't seen a decline like that since then 382 points for the dow number of reasons cited, nothing in particular. obviously surge in coronavirus cases here and abroad. uk with a tougher and longer lockdown period. prince economic activity, some concerns about the delayed vaccine roll out and of course the georgia run offs tomorrow. obviously jitters around there

though it's not clear it how stocks are going to react one way or another not like a grand consensus that stocks will sell off if both democrats win or if it continues to be republicans keeping control of the senate. what will you watch for tomorrow >> which fits with the market action today, a unified half step back from risk. you have the russell two, the nasdaq and s&p down 1.7 or 1.8% tells you it wasn't a fundamental driver just a pull back in risk exposure. you will want the to see if that continues. you have tuesday turn around dynamic that kicks in, so certainly won't know until later in the week to know how we're trading around this. people came into the new year with a bunch of factors striking the market at once as you mentioned. >> the hope of course is the u.s. isn't three or four weeks

behind what's happened in the ux, with the new -- uk, with the new strain confi confirmed in new york as well, it's clearly out there spreading already. >> for sure. we have to now assess when we get whatever eck nmic acceleration we're hoping for when we get through the inoculate elimination. >> s&p down 1.5% today having opened positive. we're out of time on "closing bell." "fast money" starts right now. i'm melissa lee. this is "fast money. happy new year welcome to the trader lineup tonight on fast, stocks kicking off with a bit of a hang over. and one saying you should by the dip. plus tesla investors living the fast lane as the stock moves to all-time highs should ride this record high later, it's a big market day tweet us at