and optimum managed care growing, with employment it is growing. >> mr. weiss >> not putting anything into the market but on my shopping list is on semi >> all right you let us know when you do something there. pete najarian, you see you at the bottom >> will do >> i will give you freeport-mcmoran i like steel but copper even more freeport >> great weekend, everybody. "the exchange" is now. ♪ >> thank you, scott. hi, everybody. i'm kelly evans. i'm sorry to tell you that stocks are in the red again this afternoon. the nasdaq is now having its worst month since november of 2008 we are 14% down from the november highs we are below 14,000 on the nasdaq now $1.3 trillion of expiring options adding to market anxiety today. we will explain. netflix is today's disaster

stock, down 25%, the worst day in nearly a decade yesterday it was peloton sinking like a stone, but if the pandemic darlings are seeing a dry up of demand is it good news for getting back to normal next week tesla, caterpillar and intel on tap we will get the news andtrade on each going into the weekend we begin with stocks sliding again. dom chu with the grim numbers for us >> the grim numbers are not as grimace earlier in the session, kelly. what i can tell you is the dow is down roughly 150 points, half of 1%. we were down over 200 points at one point. the s&p is off about three-quarters of 1% 4447 the last trade. the focus on the nasdaq composite, hovering below the 14,000 mark. off about 165 points at the lows of the session we were down 2.1% to give you context on the intraday trade for the nasdaq again, lower but off the worst levels of the day so far we will see if it sticks one of the reasons why the

nasdaq is not doing as poorly is because you are seeing specs of green, believe it or not, in semiconductors of all places they've been hard hit and volatile as of late. but check out what is happening with texas instruments, qualcomm, all up between 1% and 3% those are some of the best performing stocks on the s&p 500 right now. so the chip stocks are doing their part to try to mitigate some of the damage on the downside for the nasdaq. and then where there has been carnage, although again off the worst levels of the day, has been in cryptocurrencies the center of the universe, bitcoin, those prices down about 10%, 38,422. we were down around 37,009 at the lows of the session. ether taking a hit and so are the stocks that are generally part of the ecosystem within cryptocurrencies micro strategy, a software company, because it owns bitcoin is off 12% coinbase is down as well

paypal is off about 4.5% watch the crypto space it is being a lot more downside volatile than it has been of late back to you. >> that's for sure thank you very much. we have a record number of option expirations adding to the market's volatility today. 178 million contracts including mutual funds and etfs are set to expire today along with 135 million single-stock options some estimated the value affected at more than $3 trillion what should we expect from the expirations? let's ask my next guest who warned us a week ago stocks could see more downside because there wasn't enough fear in the markets then we will ask for an update on that chris murphy is here, derivative strategy at susquehanna. let's start with the expirations we are seeing. what should we expect? >> okay. so like you said, biggest expiration of all time january is always going to be the largest because those options are listed the longest, but this january is about 14% higher than last january

single stocks, like you mentioned, over 20% more the biggest question we're being asked right now is how much is options expiration contributing to the sell-off. we don't think it is a primary driver does it exacerbate near-term swings and can it contribute to intraday volatility? sure but it will have less impact on day-to-day market reaction it is going to kind of exacerbate the moves a little bit. then when we are talking about the total notional size, just keep in mind so many of the upside calls on the equity level are now out of the money so they will have a little bit less of an impact and, you know, maybe a reason to stay away a little bit from the notional calculation when considering how much impact those are going to have >> sure. it is always like if the experts see a number of like $3.3 trillion, they roll their eyes are you saying it is potential opportunity? so if for technical reasons we are seeing outside moves, does

it present an opportunity? >> i mean very, very near term you know, the date-to-day, week-to-week sell-off right now is not being impacted too much by options or options expiration now, what you alluded to earlier in terms of opportunities, last week we talked about we were kind of surprised, a little bit less volatility priced into the market than we were expecting given the sell-off where we were last week. we were looking for a couple of our key capitulation indicators. that would be in the nasdaq, spx and the vix inverting. what does it mean? it means near-term volatility levels spiking above the medium-term volatility, like 90-day kind of volatility. what it is going to tell us is the stress is being priced into the here and the now, and that can be a sign that we are in the later innings of selling we did not see it last week. we are seeing that this week >> interesting so i was going to ask if we are at that point yet. you are starting to see -- a rise in commodities, degradation or whatever, so are we at that

point now and usually what inning does it mean we are in for a sell-off >> so if you look back over the last 15 years, it has been a very good indicator, you know, if you look back when has it missed, you know, financial crisis, covid crisis the question you have to ask yourself is are we in the middle of one of those events we will be talking about in the financial history books going back, you know, over the next ten years or are we in more of the typical 5% to 10%, once or twice a year type of pullbacks we normally see every single year that's the major question. >> is there any other data you are looking at right now to kind of give you a feel for which one of those camps we might be in? >> so personally for me, you know, the reason we're selling off, it is not really an unknown. the fed is going to start raising rates and pulling away some of the easing you know, this is not an unknown and it is not something that has never happened in the past so typically when the fed starts raising rates, you know, the

market gets a little bit shocked. medium and longer term, it starts to rally. you know, that's more anecdotal. when we talk about the other notable thing we are seeing right now, it is very dramatic intraday volatility, much more so than day-to-day volatility. >> right and what does that tell you as a final question because it has been pointed out by several people, even last hour, the oil guest had a great way summing up saying usually we see equity investors buy the dips an not in the commodity space and lately it has been reversed the markets are behaving like the other one. what is the intraday swings in stocks right now tell you? >> so we're seeing the big intraday swings. we are trying to go back historically and look for parallels. what is really amazing is almost all of these intraday swings, the size of them have happened since 2018 you know, that's been when buy the dip has been a pretty big mantra that's maybe when we see more option trading for the

gamma-hedging type swings. we are really only seeing these types of swings in the very recent history buy the dip has dominated the very recent history. once again, we have to decide is this time new or is this the same playbook as before. i lean towards the same playbook >> all right we will check in with you in chase that changes chris, it is great to have you on today thanks so much >> thank you chris murphy with susquehanna. earnings season has reasserted itself as a driver for the market, and that's exactly how my next guest is picking stobs. he is focusing on companies that were punished for balance sheets in 2021 and should be rewarded this yearn jason brady, president and ceo of thornburg management. did i get it right, jason, in terms of hough you are looking at the balance sheets? >> yes, look, you are looking at a market which in 2021 was much more concerned or interested in multiple expansion, and in 2022 it is returning to the idea that earnings have to support that multiple expansion

frankly, in 2021 earnings did support a lot of multiple expansion. it was a great year for earnings but what we're seeing today is companies across a number of different sectors. obviously we can talk about netflix but, frankly, some of the banks are disappointing on earnings, and that's creating a weight and a move from kind of a hopes-an-dreams market to more of a where-is-my-cash market >> let's talk about some of the names you like not that earnings is not a big driver but it has been incredible you go back to jpmorgan or jefferies before that where we are seeing very large, 8%, 10%, obviously netflix even more of an outlier >> right jpmorgan is an interesting name. i wouldn't say they disappointed on earnings exactly, but what we started to see was the effect of some wage pressure on their margins. that is going to be something that we're going to see moving forward across a number of different companies that rely on

skilled labor. jpmorgan is, however, one of the beneficiaries of higher volatility in the form of what i would view as a time that trading revenue is likely to go up, a disappointment in this prior quarter, and obviously rates rising, which is something that i think is also going to be a future of the markets going forward. netflix, a really interesting one. netflix is one of those where you wonder if correction is a great term i would rather be buying netflix here than peloton. frankly, the netflix chart looks like a good peloton workout whereas the peloton chart looks like a cool down >> yeah. >> netflix is valued similar to disney which seems more reasonable than trying to put a multiple on negative earnings. >> give us a couple of names or parts of the market you think are interesting here >> sure. at the end of the day it feels like the fed put wine in a box and called it champagne, and what we're trying to do is figure out how much of a

headache we're going to get from that looking at apple as an example, not a name we really love. if that returns to multiples of the last decade, it is down 50 even though it is in a correction today we're looking at names like visa visa has been struggling relative to the marketplace, but it is going to benefit from continued transactions in our view fintech is something that seems to be bought by large financial institutions as opposed to massively disrupting visa's terrific network. there's another name that's interesting in the financial space. >> a final thought on the markets overall. i mean how do you sort of foresee this shakic ng out for e next few weeks are you getting more opportunistic, finding more companies like netflix that look attractive to you versus the difficult environment you could say of 2021? >> we are looking at the fundamentals, of course. as you said, we will get a lot of earnings news coming up, so that's really going to drive the

sentiment and it is going to drive the market in our view again, moving from that hopes and dreams to the cash today so as we're looking at how investors should position themselves, it is much more about names that you can forecast earnings as opposed to names where you can forecast sentiment. i think that change is one that's underway in the market, partly due to the fed and partly due to just a collapsing under its own way. >> reality check. >> that's where we're spending our time >> absolutely. thank you for joining us, jason. jason brady with thornburg nasdaq is back above 14,000 for the moment the ceo of ally financial joins us next live plus, shares of netflix and peloton continuing their massive slide. a look at what both have to do to grow customers and the growing pressure from competition. as we head to break, disney, boeing and visa are leading the dow lower, despite it being one

of jason's picks, while nike and mcdonald's are the biggest gainers. we're back in a moment ♪ this is "the exchange" on cnbc dream when you're feeling blue ♪ ♪ dream, dream that's the thing to do ♪ ♪ music ♪ when you see value in all directions, you add value in all directions. accenture. let there be change.

♪ welcome back netflix and peloton were two of the biggest beneficiaries of the pandemic and the auto industry was, too shares of allied financial

rallied to over $60 a share last summer they've since dropped below 50 and down 3% today despite an earnings beat on the top and bottom line and auto loan growth up 20% year on year in the fourth quarter i'm joined by ally financial ceo jeff brown it is great to have you. we are curious, what is the latest state of play in the autos market >> yeah, kelly thanks so much for having me here and a chance to showcase ally we really had a terrific year in 2021 $46 billion of origination, so that's the highest loan growth we've seen, really origination since 2004 so quite dramatic growth obviously used car price is a factor that's on everyone's minds. we think the used car market is going to stay really strong this year all of this ties in to some of the issues we've seen around supply chain disruptions and the inability for manufacturers to get a lot of new vehicles back on the lots. but all of these trends actually panned out to be really

beneficial for ally. we are the largest prime lender in the u.s. and one of the largest used car lenders in the u.s., so this market has been quite good for the financial performance of the company we were really pleased to announce great earnings this morning. it was a tough market backdrop obviously but great numbers from ally >> and that's why i'm glad to have your view kind of in real-time as to what is happening here we all expect, i think a lot of people expect, maybe we are wrong, that used car prices are going to massively reset or sales will massively reset because it can't keep going up at 50% a year or whatever happened last year what gives you the confidence to say you think the market will remain strong this year? >> yeah, so i mean a lot of this comes back to issues on new car production, and we did see new cari car inventories at the end tv year tick up a touch, but i think in conjunction it is all very modest on what we've seen so demand for used cars and cars in general remains very, very strong many consumers are still

buying cars, again, evidenced by $46 billion of production we did last year. but we think the normalization in used car pricing is going to be very, very gradual. early signs in 2022 is the market staying quite strong. what i will tell you within our financial projections that we provide to the street, we call for a 15% decline between the start of 2022 and the end of 2023 i think the reality is going to likely pan out to be something different. we think used car prices are going to remain quite robust for the foreseeable future >> if i were chair powell i wouldn't like what you are saying because the best way to kind of achieve lower inflation rates is to have, you know, big resets in some of the hottest parts of the market, and what you are describing is more like a permanently higher plateau, is that right >> yeah, i think so. i mean certainly for the foreseeable future you are going to expect to see used car prices remain high. clearly that's playing a big role in broader inflationary trends whether it is food, gasoline, energy, you name it, prices are

certainly on the rise. i think the fed is very mindful of some of these more permanent dynamics that are here to stay certainly this is also factoring in wage inflation as well shall and that's part of the reason giving me confidence in our outlook, the strength of the used car outlook as well really, if you want a job today you can get a job today and you can get it at a higher wage level than a year or two ago >> it is funny you bring that up because in light of what jpm and goldman told us i was going to ask, albeit you are a very different kind of business are you yourself facing pressures from a higher cost in that sense >> we as a company try to take a long-term look or long-term view when we provide revenue guidance we have seen expenses pick up but dramatic revenue growth alongside of that. for example, last year our revenues were up 25%, and it is hard to project that level continuing into the future

but we try to take a very balanced outlook on both sides of the income statement. so we will see expenses modestly tick up in 2022, around areas like employee compensation, benefits, mental health, things like that as well. but overall we feel really good on the positive operating leverage we're going to continue to be able to deliver as a company. >> very interesting, jeff. thanks for joining us today. we appreciate it >> kelly, great to be with you thank you. have a great weekend >> you too jeff brown is ceo of ally financial. still ahead, big tech's antitrust battle is heating up and my next guest says it is only getting worse for big tech. he joins with what he sees for them ahead and what the companies should do about it plus, the meme stocks are being crushed so far this year amc down 37%, gamestop down nearly that much a lot of first-time investors are getting a taste of the tax implications on these trades as well all you need to know ahead you need to hire. i need indeed. indeed you do.

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see why a medicare supplement plan from a company like humana just might be the answer. ♪ welcome back, everybody. this has been the toughest stretch of the market lately, this after noon slide into the close. do you near session lows down 240, only 20 points off the level so far the nasdaq back below 14,000 it is the worst performing with 1.5% drop today. every sector is negative for the week consumer discretionary is the biggest laggard, having the worst week since the pandemic loss of 2020 financials are seeing the worst week since june. tech is down 10% in january, on pace for the worst month since 2008 you can blame the chip makers for a lot of that. amazon is the biggest laggard today, set to post the fourth straight week of losses. shares down 10% in the past four days anyway, the four-day stretch is

worst in two years we have roku, disney, palantir, twitter and pay paul disney, by the way, is 30% off the recent high, the biggest decline of all of the dow stocks, down another 6% today. sun power is plunging on weak fourth quarter guidance. shares are 70% off the recent high from about a year ago there you see it down almost 17% today. let's get to kristina partsinevelos. maybe she has better they news for us >> i don't so perhaps i should pass it back to you virginia governor glenn youngkin wants to make sure parents decide whether kids wear masks in school. he is asking his state's supreme court to dismiss a challenge to his order allowing parts to opt out of school mandates for the kids where storms are expected to hit next, tonight at 7:00 eastern. in illinois, an amtrak train has been stopped in its tracks after a freight train derailed there are no reports of injuries but residents are being asked to

avoid the area at the vatican, pope francis is promising justice for victims of clergy abuse. this a day after a report found his predecessor, pope benedict, failed to act in four cases of abuse by clergy when he was the archbishop of munich pop francis says the church is still seeking its way forward in handling abuse cases sorry, kelly, couldn't do it couldn't lighten the mood. >> we feared still we appreciate it, kristina kristina partsinevelos next week intel and caterpillar set to report next week we have the trade on all three stocks in earnings exchange next ♪♪ ♪♪

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♪ welcome back, everybody, to earnings exchange. things really ramp up next week for earnings maybe we should be bracing ourselves because nearly half of the dow components are reporting. so in this edition of earnings exchange let's hit a couple of stocks starting with intel, reporting next week. one of 2021's worst performing chip stocks, one of the only names positive so far this year. they announced they will pour at least $20 billion into factories

in ohio as they expand capacity. is it working for the stock? joining us with the story is our own michael santoli and here with the trade is gina sanchez, a cnbc contributor mike, intel, what are you watching >> well, the big question is whether expectations have been pounded down low enough going into the report. it is not about this year's earnings for intel everyone knows it is going to be a retrenching and reset year the last six quarters though intel, the stock has declined on earnings by an average of 10%. that's sometimes when they've beaten the number, too, because the guidance has been bad. to me it is all about incremental progress toward the long-term plan, not about what the quarter or even the rest of the quarters this year is going to deliver that's how the stock is valued right now, it is on a maybe turn around, 14 times forward earnings only a quarter of all analysts have a buy on it i think you could argue expectations should be pretty low going in >> are they starting to turn a corner here, gina? do you like the stock? >> i actually think they are starting to turn a corner here

there's a couple of things that are coming together for intel. in the near term you have a big refresh cycle that is happening, just post-pandemic everybody is ordering new pcs, helping in the near term. you also have mobileye that's going to ipo in the longer term they're making significant investments into new fabs in ohio and arizona, australia last year you have the potential for congressional support through a chip legislation that would benefit them that's the longer term it is pretty positive for intel. >> you are mildly bullish i think we will call it. we appreciate it michael santoli, we will see you again soon let's move along to tesla. the $1 trillion auto giant down 9% to start the year despite crushing estimates for deliveries in 2021 and in it fourth quarter analysts will be watching for comments around production delays around the cyber truck. maybe we will hear elon musk on the call phil lebeau is here with the

story on tesla phil >> kelly, that's the expectation that we will hear from elon musk during the call. what people will be focused on, which by the way don't be surprise if they exceed expectations they have knock-out numbers in terms of deliveries. average transaction prices have been climbing higher the real focus is what does elon musk say about the product roadmap. that will obviously include the cyber truck, which many people believe will be pushed further into 2023. do we get better clarity on that what does he say about austin and berlin in terms of production starting? what kind of indication does elon musk give us about perhaps future models? they're not going to show us a future model but they may say something like, look, a particular type of vehicle is in our wheelhouse and we think that we can roll that out at some point in the next couple of years. those are the kinds of things that people will be focused on when he talks during the analyst's call we will see if the product

roadmap is really a roadmap or is it, you know, some indications, and then we are left to wonder, okay, what exactly will tesla do over the next couple of years >> right but if elon himself is on the call at least the possibility remains elevated he will say something like that. the stock is back below 1,000 today, gina. what do you do with it >> this is a tough one right now because the market sentiment is against very, very highly priced stocks if you look at the market, everybody is value hunting and that's not really what tesla is. i'm not sure an earnings beat would save it from seeing more declines as the market sentiment is just against a highly valued stock right now regardless of what the outlook looks like. >> by the way, phil, since we already know the delivery number, i'm not, you know, accustomed to following tesla's results as if revenue and eps matter so much because, as we said, so many other factors move the stock. but what do you think is the most important metric this time around >> oh, i definitely think it is going to be what are their gross auto margins and their average

transaction prices i think those will really tell us if things have slowed down at all, which we do not expect. there's no indication that that is the case in terms of tesla's actualbusiness so this obviously becomes, as gina mentioned, a question of valuation. how much are you willing to pay for this company right now >> fair enough all right. we will leave it there, phil thank you very much. our phil lebeau on the tesla beat finally, caterpillar the industrial giant up 4% to start the year as investors look to the value trade and any lingering benefit from the infrastructure bill. but will a slowdown in china impact the bod only line seema mody is here with what to expect next week seema. >> kelly, it has been a standout this year, outperforming the industrial sector while supply chain constraints are not expected to go away in the near term with omicron there's a narrative building around caterpillar with the longer term story remaining intact at the center of that debate will be china. do we see a much-needed rebound in the second half of this year?

does a company like caterpillar hold up, kelly, on the face of rising rates on the idea it is highly diversified, profitable, stable dividend, potentially entering an up cycle with the infrastructure bill around the corner there are also questions are technology at the consumer electronics show john deere had a big promise there. it has been one of the more innovative industrials, putting a lot of money towards mna where does cater pillar stand on that will they unveil new products next week? >> it was refreshing to see john deere at the technology showing, everyone talking about self-driving tractors and all of the technology coming. join gina, do i think it is caterpillar's year >> this is a great stock, and, as i mentioned, the market sentiment really favors a stock like caterpillar because it is not expensive, it is a good grower, and it is still being benefited from the continued recovery the recovery in the developed

economies are starting to slow, but we should expect a recovery to really take hold in parts of the emerging world that really haven't gotten to recover yet. so we still have a good outlook net/net for caterpillar going forward. we are pretty bullish on it. >> seema, it is a reminder as much as we are talking about the u.s. maybe, you know, experiencing a more of a reopening, revival this year, i can't quite figure out what is going on with china. they just cut rates and, you know, their covid strategy paid off in early stages of this pandemic but we'll see about now. >> and interestingly enough, kelly, if you remember during the trump administration and at the height of the u.s./china trade discussion, caterpillar was seen as one of the proxies, right, when it comes to china's trajectory makes about 5% to 10% of its sales in that country, so absolutely the commentary we get from the ceo on the outlook for china may actually provide better guidance than the economic data we get from china i think that's actually why wall

street looks to this company for guidance >> yeah, no, a great point its forward p/e still de low 19 as well. gina, a quick comment before we go, could you give us a comments on the markets overall as we wrap up a pretty frustrating week >> look, the markets right now are really -- if i could describe this market, i think it is a growth at a reasonable price market we are still seeing growth growth is still above expectations in all of the earnings expectations in every sector except financials, are expected to be above 10-year averages for this year that's growth, but the market hates anything that's overpriced right now. so not a pure value play i think it is a garp play. >> a garp play it is like one of those words that sounds like what it is. gina, thank you very much. we will let you go seema, thanks to you as well seema mody reporting up next, gina khan faces scrutiny on big tech a senate panel dealt the

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♪ welcome back to "the exchange." the antitrust battle between lawmakers and big tech getting fiercer after a bipartisan senate judiciary committee approved a bill barring them from favoring their own products over those of competitors. my next guest says the scrutiny will continue to intensify and tech companies will have to spend big money and be ready for prolonged standoffs, especially when it comes to deal. joining me is dan clifton, head of policy research at strategas research partners. dan, good to have you. a dizzying week here in terms of lina khan giving her blueprint and now the senate finance committee. how seriously should companies take this? >> sure. first, let's say when legislation slows down on a back row basis you start to see more

regulation so this week the regulators said, we're looking at changing the antitrust rules and merger guidelines and that process started. it was timed almost perfectly to what you are asking about, and that is the senate judiciary committee successfully passed out of committee legislation where big tech will not be able to preference their own items. if there's a theme between the two different buckets here it is that big is bad. anything that is big is bad. they classify who will be affected by revenues or market cap, number of users you have, and that seems to be where the attention is this bill passed out of committee 16-6 that's within a 50/50 senate, kelly, so it shows you there's bipartisan support >> wow >> but when you tally up the members and what their comments were yesterday, a majority of members still expressed reservations with this legislation. so it has a long way to go in the senate there's going to have to be changes. this bill passed the house in june, very similar, and it has

been stalled in the house ever since. particularly, california members are worried about their own companies being attacked threes issues over u.s. competitiveness, issues over u.s. privacy, privacy particularly with apple, and then other types of more specific issues that will be dealt with on a company-by-company basis you can start to see this pricing in amazon is probably the most affected by it, down 6% in the last two days since this bill passed out of committee. >> wow, you think this is definitely a reason for their under performance. i don't know if this is the right question to ask, dan, but is it legal to sort of regulatory wise go after companies or deals because of their size and only for that reason >> under existing antitrust law, which is pretty clear, being big alone is not a reason to do it even being a monopoly is not a reason to do it, but you have to be abusing the market power for that deal to be there.

antitrust law is pretty clear. it has been there for 40 years what are you seeing on the regulatory side is any deal really over $10 billion, no matter what industry -- i know we like to talk about big tech >> right >> but it is affecting rails, it is affecting insurance, it is affecting airlines it is unbelievable how big an impact the biden antitrust regulators have head and that's why you see merger spreads laying out some of them are over 20%, and they probably would have went through under president obama or president clinton or definitely george w. bush and donald trump. so something has changed here. it started to really change around the month of june, and it was this idea that once you get too big, not do you have this kind of market power but it starts to affect wages if you look at the comments about the microsoft/activision deal, particularly elizabeth warren in the last couple of days, she is talking about how this will impact workers that is something that will be a big focus in the merger

guidelines at the department of justice and federal trade commission start to release in late march >> i was stunned to see activision trading at such a discount to the $95 deal price, probably one of the biggest i can remember that a deal that the only reason anyone could come up with it not clearing is because of its size. >> correct >> you know, i didn't hear a lot of figures cited with microsoft's share in the gaming market there's activision, as you can see, still not moving much from when the deal was announced. what would you tell investors here should -- i mean if it takes a couple of years for microsoft to close this deal or it doesn't get closed, what will be the fall-out from all of this? >> you hit the important points. you will have widespread because of uncertainty and microsoft guided that this will take a year, year and a half to get through. why would i want to sit there on a 15% spread and waste my capital on that now? as you get closer to the guidelines, i think you will see the merger arbs come in, but it

probably would be a deal with a lower spread if we didn't have events over the last year in this antitrust allows you to go to court. at&t was challenged by donald trump, they went to court and they won it is a beautiful process. the goal of the regulators is to extend this process out, threaten court and say, if you are going to be in you have to be in for 18 to 24 months. that's going to be the threshold for companies. are you willing to go all the way to the end to be able to do this that's a different hurdle now for deals because they're not going to change the law in this specific area. one other big point that you just referenced though when google announced its merger of fitbit, every single antitrust senator and congressman you see out there passing this bill criticized that deal when it happened kelly, they were awfully muted when microsoft announced its deal this week, and i think that is something very, very interesting because it is telling us that microsoft has basically laid down some of the ground work and have more

political support -- they're viewed as the good guy relative to some of the faang names viewed as bad tech microsoft is bigger than them, but they're the good tech at this point >> now we think fitbit, it is so small why would anyone even care dan, it is a great point good to have you dan clifton joining me from strategas. >> thank you, kelly. still ahead, taxing your tendies. i'm missing something. we will get a look at what reddit traders need to know ahead of april 15th next digital transformation has failed to take off. because it hasn't removed the endless mundane work we all hate. ♪ ♪ ♪ automation can solve that by taking on repetitive tasks for us. unleash your potential.

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♪ welcome back some of the retail traders new to the market may have a big tax surprise heading their way sharon epperson is here with what the investors need to know. sharon >> well, you know, kelly, tax filing season starts on monday, and last year's trading frenzy over meme stocks like amc and gamestop could have an unexpected impact on tax returns for new investors. take amc, the sharp rise and fall early last year made it one of the meme stocks of the movement it became the top holding for

ag gen z and finished the year this third place on fintech's solutions top 100 list for investors ages 24 and younger. >> in most cases it was a buy and hold i think in some cases they actually added to the position, really smart as this thing was climbing and then in some cases some folks took profits before the end of the year. >> new investors who took profits in amc and other stocks need to know how they will be taxed on these investments short-term games from stocks held for one year or less before being sold are subject to ordinary income tax rates. long-term gains from stocks held more than one year will be taxed at 0%, 15% or 20%. a net capital gain is considered income and an increase in income could reduce certain tax breaks. >> student loan interest, child tax credits, you know, a deduction for medical expenses these things are all tied to

your adjusted gross income >> the higher your adjusted gross income the fewer tax breaks you may be eligible to get, kelly >> well, and we are talking about kind of if you had gains what about if you had losses, what should you do tax wise? >> well, you need to need to kn tax impact there as well investors are more losing stocks than winners can deduct up to $3,000 against their regular income now, if your net capital loss for 2021 is more than that limit, you can carry the loss forward to future years. >> the full amount >> you can carry the loss -- yes. every year, use that $3,000. if you have a lot, you may take several years to exhaust that is this wow. >> but you can use it against your gapes, yes. >> use it for decades, all right. it is great to make profits, that's what happens if you have

losses is there impact from trading that new investors should be aware of. >> if you have significant gains, that's factored into your income and it is used to factor your estimated tax for the next year if you had gains for 2021, your estimate taxes could be higher the next year, also. >> to read more about this go to cnbc/invest in you up next, shares of peloton and net licks hammered over the past two days. both down more than 20%. we will look at what the two mpiene to to to fix their growth problems and stay competitive next

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netflix is on pace for its worst day in nearly a decade after noting competition is starting to eat into its subscriber growth despite 8 million subscribers last quarter let's bring in dan gallagher of the "wall street journal," and matt douglas matt, what do you think you do with netflix here? >> investors are reevaluating how are they going toi invest in this business? the q1 subscriber forecast we saw indicates that growth is going to be slower going forward. it has been in the 25% range annually, even in the years ahead of the pandemic. now, wall street is be labeling it a high single digit number in the years ahead. because investors have been focused myopically on streaming

editions they have to find a new way to evaluate netflix as more of like a revenue cash flow growth story as opposed to a fast user growth story. >> in every way, mark it seems like netflix is maturing, p/e was down to 35 it is facing competition it is a mature business now. what happened with this recent stretch? why do you think they are having a hard time adding as many subs as they expected. >> et cetera simple. everyone has access to netflix it is hard to find someone who doesn't have a netflix account or have access to one. but that's an opportunity for the business for years they have been encouraging sharing of accounts. but the company is slowly start to essentially make that more difficult and drive more subscribers. and i think one thing that hasn't been explored for netflix at all but they really should consider, and there have been rumors of it which is to have an ad-supported offering so they

can go beyond the 70% market share they have into really the corners of the market and get every single entertainment consumer >> i also thought mark it was interesting you are warning a little bit about this idea that yeah it is a hit-driven business, so netflix is going to keep coming out with unique shows and that will drive subscriber growth. what worries you about this model? >> i think the interesting thing about netflix is hits come and go it is ten episodes a year, for anybody, for hbo, hulu, anyone but then as an entertainment consumer you are looking for what to watch. that's the space netflix dominates. it's the time, entertainment time between hit shows, both on netflix and other world. that's where they dominate the market i think in a way that no one else does. i think them becoming hit driven is not helping the business. they want to continue to be the go-to choice every night of the

week not just when your favorite show is on. >> they were by default in the past because they were kinds of the only game in town. but there are other streaming services you can linger on the famous joke about netflix is you spend half an hour watching nothing, just poking around. >> for sure. and i wonder also if we are going to see the company reevaluate sort of how it releases content netflix is one of the few streamers left that does a dump. when they have a new series it all comes out, every episode all the major ones, apple, disney, hbo, those come out episodically the benefit of that is people who really want to watch those sign on for longer periods if you are at a point where there is one or two shows you like on netflix, sign up for a month when that show hits, watch them all, and then you are done. netflix might want the reevaluate that going forward. we will see. but you know they might be looking at a lot of options here for kind of howto address this

>> turning to peloton, mark, before we go, i have to ask you, you rode to the rescue last time with ryan reynolds and mr. big after that sex in the city episode killed him off you had a fast service response ad where he said no, no, i'm okay peloton has a healthy business figuratively and literally they are in the fitness market and i think fundamentally everybody else in that market would love to have the peloton brand. so they have the brand they have the product people love and i think that's a strong point for them to go forward from i think they can come down market in terms of price points and product and just kind of get back to basics and the company will do fine i would personally -- i am a big fan of peloton, i use the product. and yeah, i think the stock is great in the long term. >> should we expect any other fun ads in the near term do you think they are beyond that right now

>> i -- i think right now we are not creating any ads for wall street analysts. so there is nothing come out to pad the market. >> fair enough it has been a difficult little stretch for them we thank you guys for downing us today. mark douglas and dan gallagher talking about the growth troubles for both peloton and net flick. that does it for "the exchange," everybody. "power lunch" six things up right now. celleer, thank you welcome, everybody, to "power lunch. i'm tyler mathisen here's what's ahead to wrap up a busy week. bubbles bursty, from crypto, to high growth, to spaces, speculative parts of the market are deflating, and fast a. seasoned trader weighs in and tells us who to expect for plus, netflix nose dive, plunging more than 20%, largest single day percentage drop since

2012 a to