>> absolutely. robert, thank you very much. robert frank reporting. folks, we've got a gain of 250 points or so on the dow. >> the real question today, can you trust this rally we've had some competing opinions about that today. thank you so much for joining us for those conversations right here on "power lunch." "closing bell" starts right now. stocks are building on this week's strong rally. some headlines hitting the tape a few minutes ago from information that apple is cutting iphone 14 plus production that's taking some steam out of the rally. welcome, everyone. this is a make-or break hour for your money i'm sara eisen apple just turned negative the dow overall is still up 200 points s&p is up almost three-quarters of a percent the nasdaq is lagging today. we are putting together here

back-to-back gains if we continue to trade higher and close positive in the next hour. there's the ten-year treasury note yield, at about 4% or so right now. i mention it because that is obviously one of the big drivers of stocks right now, those higher yields standing in the way of an equity rally, and certainly dampening some enthusiasm just looking at the ten-year, a little bit weaker. really not moving a whole lot. check out some of today's moving earners. goldman sachs is higher on a beat lockheed martin soaring up johnson & johnson beating on the top and bottom lines hasbro is pulling back after the bell we'll get netflix and we'll be joined with a preview in just a bit. let's begin with the activist news that david faber broke today. salesforce shares are up 4%.

david faber joins us with the latest i'm interested in the colgate news you brought but activism heating up. we can start with salesforce we did report that this morning. it was followed by a presentation by jeff smith at an annual conference we attended, an active passive conference in which he made a presentation that he focused on salesforce, a new position at starboard. interesting from their perspective because it is such a large company, we're talking about $150 billion or so market value. but it was underperformed. when you look back over the last few years it's underperformed the s&p and a lot of its peers and smith points to operating margins as a real focus for potential opportunity there. i'll let him say it. perhaps he can do so better than i can. >> what we would say, what i have said to them, is you're great at all that you do inside your business, you're number one

or number two in all the areas in which you compete you're highly competitive internally you want to win. we as shareholders, we want you to bring that same energy, that same focus on being number one or number two, ideally number one, on these metrics, also. and on this metric in particular, they're not even average. >> for its part, salesforce simply says, listen, we're committed to acting in the best interest of our shareholders and are focused on continuing to execute on our strategy outlined at dreamforce. you know, sara, smith says they can just simply do better. their long-term targets are less ambitious than their peers they need to achieve and outperform the investor day targets that would result in significant growth and free cash flow, driving higher incremental margins would result in significant outperformance and ultimately think the valuation discount is largely a result of

subpar mix of growth and profitability. nothing sets up here for a real battle at this point i should also point out in my reporting i ran into a couple of other well-known activists who thought about salesforce as a potential play and chose not to engage there they were more focused on capital allocation, perhaps questioning some of the deals the company has done but many people felt like taking on benioff, a giant of a man in so many ways, it's just not going to happen for you, even though he does not have voting control of the company he has such great influence and reputation, they felt like it would not be a fight worth having. >> on the capital return program they just announced their first buyback, $10 billion buyback he's got a good track record on acquisitions, i guess,except for the slack one where they clearly paid a high price. it would have been valued much less today is that what has been the problem at salesforce? because it is an interesting one, because they've been a high

growth company for years, driven by with a lot of the acquisitions. >> the point smith is making is it's not dropping to the bottom line and he said that time and again, they're not dropping as much on the bottom line. they haven't been focused on operating margins as they should be i'm just quoting from our interview. and he's not being overly critical, but he thinks they're moving in that direction but he wants them to get profit margins up others may have different criticism, but they haven't acted on it, certainly not in a public way with the company. >> i wonder what a large stake is for a $150 billion company. >> as we know, activism for many years, you don't need a large percentage stake perhaps if you have a reputation as they do at starboard. but it is significant in terms of dollars, even if percentage-wise not. >> quickly on colgate because i found that news really interesting, because i covered

colgate and the pet food business, which i know is kind of at stake here, which has been the growth driver for this company. i wonder if they -- maybe there's an argument that if they spin it out, which is i think what loeb wants, that there would be extra value there, it's not being fairly valued. but there's also -- they get a lot of scale and costs and benefits from being part of that company, which has actually done pretty well. >> as i had reported, they've been approached previously about that idea and thus far my understanding is the board and management have not been interested in splitting the company. to be clear here, loeb in his latest shareholder letter included a new position taken in colgate. i'm told it is at least $1 billion. he also has been aided by the hedge fund toms capital investment management, so there may be additional ownership here, based on the basic idea that there is a lot of potential for unlocking value.

but loeb wasn't saying do it, he said if you did, we think it would trade at a higher multiple, could be worth as much as $20 billion when you look at the market cap of the overall company, that would conceivably add a lot of value. he did point to the fact that the board has not been bold in his opinion, and that, you know this given how closely you cover this area, there's been a good amount of potential talk of consolidation. you have the spinoff from pfizer and glaxosmithkline there's at least a question as to whether if you got colgate to engage and they considered a split, could you imagine a scenario under which hills would trade at a higher multiple and you could sell at a significant premium the rest of the company. >> that's pretty interesting organic revenue growth of 15.5% in the first half of this year is pretty good. >> it is good.

>> they also do not engage in media. >> most of it is in the pet stores. >> that's what i'm talking about, the pet food business. >> yeah, the other business is not, right. >> oral care has had a little comeback but not that kind of growth rate. thank you, david really good stuff today. david faber. let's get to the broader market because stocks are mostly higher again but there's still plenty of skepticism on wall street history says to fade this rally, ubs notes conditions are not in place for a sustained rally. jpmorgan says weaker investor positioning should limit further downsides. so what do you do? do you trust the rally joining us is ubs private wealth management and from clocktower group, it's good to talk to both of you ali, what are you telling your clients? >> having just put that quote up, sara, i don't want to be a

wet blanket, money going up, not down, is a good thing. but we have looked at the last 60 years of bear markets and recessions and we found there are three pre-conditions that have to be met in order to have some sustained upside that is more than a bear market bounce and as i explain those to you you'll see none of them describe where we are today the first is that investors expect looser, not tighter monetary policy. you see a two-year going down, we're still going up as you just alluded to the second is that there's a line of sight to a trough in economic activity, if we just pick on one piece of data, we have the ism that's still going down that's not going to get us there. and then the third is that you have an increasing equity risk premium. the equity risk premium, that which needs to incentivize equity buyers has gone the other way this year, it's gone down and it's largely gone down not because there's a risk premium,

but because it's reflecting the interest rates so we have some buyers stepping in, getting flow and sustainability, at least some support in this market is really important and we will take it, but we do not think we are out of the woods yet. >> marco, you had some interesting trades i don't know if you agree with ali, but you have been in the fed is going to pause camp explain. >> so i think jay powell has an interest in proving guys like me wrong as much as he can before causing a recession. so i think he's done that really well but i would probably be in the same camp as the other marco with an unpronounceable name the fed, if you look at what's going on around the world, normally when the fed starts raising rates, things start breaking in the rest of the world. things are not breaking in south

korea or thailand. they're breaking in the united kingdom. i think what's happening is a crescendo of central banks that are starting to either pause or ease overtly the second issue is that if the fed gives room for reflection, as brainard recently called for, i think three things that will do well are commodities, emerging markets can rally and europe, which is very high beta to china, is going to do well as well. >> so you guys are in total disagreement ali, you're not seeing it yet. i guess my pushback, ali, they're not going to ring a bell when it's time to buy stocks, right, and when the fed is going to pause what is it going to look like? >> right and that's the concept of market timing, it's secondary to timing in the market. so i think there are two parts to that. if you're already invested in the market you need to make sure

you're repositioning and rebalancing so that you can take advantage of what we're coming into, which is very different than what we came out of a lot of that is just having fixed income again, having an alternative, having a private vintage year in 2023 that should be, quite frankly, epic, as private markets start to open again and rationalize what it's like to operate in a world with capital. do we think there's still potential for more downside, yes, when you look at bear markets and recessions in the past, there has been much more pronounced downside in where earnings go. we just came down about 4% year-over-year that usually looks closer to 16%. does that mean that you should be staying out of the market absolutely not it means you should be getting into those areas where you think you're going to see outperformance, whether that's three months from now or six months from now, and begin the dollar cost averaging. >> quickly, so you're buying

commodities, marco, on the opposite view. is oil included? >> so oil, i think, is really going to have to wait for the pivot. but what's coming out of china is encouraging, both with zero covid, there's a lot of things not being reported also on real estate, they seem to be putting in a bottom. so i've been bearish for most of this year on oil i think that's helped stocks in a shape or form and helped cpi get to where it is going forward it's a much tougher call and it's going to depend on what happens in demand i think policymakers in china are going to have to step back because they're facing a lot of political risks going forward if they don't put a floor on the bottom. >> thank you both for joining me now. marco and ali. speaking of oil, the strategic petroleum reserve, we have some news diana has the story. >> we just got white house confirmation that there will be an announcement tomorrow on high gas prices i'm at a climate summit in

seattle with the energy secretary, jennifer granholm. >> what can we expect? >> i'm not going to get ahead of the white house. suffice it to say that the president, if there's one thing that makes him lose sleep at night, it's that people are paying more money for energy and gas at the pump is the most visible manifestation of that. however, i will say that over the past few days we have started to see prices at the pump on average tick down about five cents and we hope that that continues. obviously the upward tick in prices, some of which had to do with opec's decision to cut 2 million barrels per day. but the president is looking at this and he's got a lot of tools at his disposal, including the strategic petroleum deserve. >> you said spr. >> i think it's one of the

things on the table. >> we expect that announcement tomorrow >> thank you very much diana, just looking at the price of oil, down about 3%. back in may i spoke with investment banking legend ken mollis and asked him whether he thought we were heading for a recession. here's what he said. >> there will be tremendous revision i don't think we're going to a recession where we're going to have negative growth, but i think we'll have volatile change. >> we'll see whether ken has changed his tune when he joins us next for an exclusive interview. you're watching "closing bell" on cnbc.

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stocks having another strong day, but it has been a volatile session. we're up 212 right now at the high of the day we were up 652 the uncertainty this year is weighing heavily on the m&a world. mergers and acquisitions slumping nearly 50% from last year joining us is ken moelis of moelis and company great to see you again welcome. >> great to see you, sara. >> it's not like deals aren't happening, but, boy, have they slowed down. what is it like from your perspective? >> yeah, they have slowed down and maybe it's like every other industry, maybe we have a supply chain problem and our supply, i guess, in m&a, a lot of us is finance, especially in the leverage loan market and transactions that involve less than investment grade credit,

and it's just almost impossible now to get a deal financed so that's a problem in the short term. >> when and how do you see that turning around >> look, it's kind of a strange world out there. we have a mid freeze on employment, the banks, i listened to some of the bank calls, there's almost no credit problems in the system, bank capitalizations are fine i think there's an extremely volatile market right now. the post jay powell speech at jackson hole, it was a rapid increase in volatility, you can see the last few days in the market, and there's been a real change in interest rates and risk ratings for leverage credits. there's a significant amount of transactions that are still hung in bridge loans in the banking system that have to get cleared. i can't tell you the exact day it will happen, but i'll tell you there's a real feeling out

there that it's containable to a timeframe. i don't know if that's ten weeks or four months, but it just feels like there's a wave that has to get behind us of re-valuation, interest rates and resetting valuations. >> it comes to the fed pause, your market outlook depends on how much more you think there is left to do for the fed and ultimately what the next move is replayed a sound bite when you were with me in davos in may saying you don't think there's a recession coming you've been right so far we've had negative growth but it hasn't felt that way the unemployment picture is pretty good. have you changed your tune about what you think is happening in this economy >> well, i do think the jackson hole speech made things a little tougher out there, but it was interesting, when you and i met i think jay powell, we discussed the fact, and i felt that the fed was going to be tough.

i felt no chairman wants to go down and release inflation back into the world i thought personally that it would be -- that he would want to stamp it out pretty dramatically i look back and i think the thing that might have shocked everybody, including i bet the fed chairman, was when he took the fire extinguisher out in june, july, that we were shocked by the inflation reduction act, which i don't think anybody thought government spending was going to be shut off all of a sudden you had the fed with a fire extinguisher and policy -- you know, policy from the federal government throwing another $1 trillion of gasoline on the fire. i think, looking back, that might be what's causing this tremendous clash of the fed with the economy. >> in other words, it was not so much an inflation reduction act as promised? you think that's a spark here? >> you know, spending $1

trillion is often not an inflation reduction move it was the inflation reduction act, i read it, that's what it said it was. but i don't know many worlds in which spending $1 trillion would result in lower inflation. >> i do want to ask you a little bit about politics in a moment on the deal front there was an interesting article in the ft today and they tallied the number of companies that went public during covid or post covid. three-quarters of the large companies that went public during that period are trading below their offering price and they say forcing some promising names back into private hands at these fire sale valuations, posh mark, for instance do you think they're good targets? >> some of them. there's a lot of different companies out there. i love this business, there's nothing better than being

involved in wall street from this point of view, because you see the radical changes that people make in their outlook for the world and how exciting something can be at one point in the cycle and how ridiculous or unappetizing it can look at other points and i think the market is a humbling event, these companies, many of them had incredible stories and prospects at the moment they went in and people had a different time view on growth and what they wanted to speculate on then the world changes, and the great part is the capital markets will respond if there are good companies out there being left by the wayside, that will lead to significant transactions in the future and this is the dynamism of the market. >> we've seen a lot of that from orlando bravo and others so, ken, you're hiring, even

though deal making has fallen sharply, ipos off a cliff. why are you hiring investment bankers? >> because one day this ends the world grows. even in this environment, i will tell you that the engagement of most of our clients in continuing conversations about the future and buildout of their five and ten-year business plans is unlike any cycle i've been in in the past. i think back to the '08, '09 cycle. people were hanging out in caves and planning where they would run to in the crisis today it's nothing like this almost every conversation is focused on where will i be in three to five years, how does technology change my business, what do i need to do to respond. we just announced today some significant hires in health care

believe me, nobody is cutting back on investment in health care research, in keeping people healthy, in solving illnesses. these are things that the world will continue to absorb and be very aggressive in again, we're not a bank. we're not levered, we have no debt we have a lot of capital and i'm planning for the next five or ten years when the cycle turns back up and then trying to find the talent to service that will be impossible >> ken, stay with us, if you would. because i do want to ask you about the midterms and another potential catalyst here for the market on the other side of the break. we're talking to ken moelis with the dow up 245 or so, off the highs of the day it does look like we're going to get back-to-ba gnsckai the nasdaq is lagging, up 0.5% the nasdaq is lagging, up 0.5% we'll be right back.

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welcome back to "closing bell." we're back with ken moelis midterms just three weeks from today. could it be a market catalyst? ken, i remember you mentioned a few months back that you thought it could be bullish if republicans take back power. do you feel that way still >> i said split government, sara and i think, look, i think business likes a split government again, to my point that the last g go-around and maybe the one before of government spending i don't think is working out well in the markets, i think, i hate to say it, for business, not for everything else in this country, for business gridlock is a good thing. that's one element of policy that could be very helpful. >> you kind of dodged the recession question you were worried about the inflation reduction act and the change in tone from fed chair powell post jackson hole does that change your view of

where we're headed economically? >> what i said to you is i think recession is defined -- you and i laughed about it and now there's a huge debate over defining the word recession. in and of itself that's become a political argument and i said i wanted to stay away from it. look, again, it feels out there that the economy is going to get tougher and things like home prices, levered companies, but 3.5% unemployment is very hard to fit into the word recession as well. so i think what i said at the time, i still believe, which is extreme volatility in things that had been misvalued or levered, but yet again, i'm not sure we've ever had a recession with 3.5% unemployment i'm trying to stay away from getting into the definitional catastrophe. >> fair enough well, it is a hot debate right now. i'll put it another way. how is your bankruptcy practice doing right now? because bankruptcies have been so quiet over the last, i don't

know, decade or so is that picking up and do you expect more? >> okay, so that's a good example of your point on recession, which is rates are coming up. now, it is interesting, everyone wants bankruptcy to occur immediately. really there's only been like one or two interest payments at the new rate it's all happening so fast, people are like, why aren't you bankrupt instantly but the good news is the amount of pressure on the system is way less than you would expect given the markets, given what you're seeing in credit markets and seeing in the stock market so calls are increasing, we are way more active than we were six months ago or even eight weeks ago. but the amount of defaults and stress in the system is surprisingly light given the amount of leverage and given what we're talking about, feeling like a distressed market. >> i imagine it's concentrated,

too, in places like crypto and spacs and other pockets of the higher speculation areas of the market is that what you're seeing >> crypto is very unique and there aren't that many levered entities we were involved with an entity that had problems and the spac market, i don't think, was too levered. it was just valuation problems, highly speculative high-growth companies. i don't believe it's going to be -- the last cycle it was centered around commodities, a lot of oil and gas in the past down cycle i think this time it's just going to be that idiosyncratic company that had too much floating rate debt or was too levered or is exposed to some angle of the consumer market that might get -- might have a problem due to inflation and gas prices so it's interesting, i don't think it will be a sector this time i think it will be that company

that over-levered itself going into the cycle. >> that's interesting, and also speaks to the fact that the system is in better shape. ken, thank you it's always good to catch up with you i appreciate it. >> thank you great to see you, sara. >> ken moelis. up next, mike santoli on whether the market could be setting itself up for a year-end rally. we're building on the gains here just gained 100 points or so dow is up 330. we'll be right back. vo: ferrari knows racing. palantir knows data.

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welcome back let's get straight to mike santoli for context around the two-day rally in today's market dashboard. how are you monitoring the health signals >> well, sara, we have some respectable upside follow-through, 1% after 2.6% or so yesterday and leaves the s&p 500 up above the thursday morning lows not a bad move in four trading days we got tested by a bump higher in treasury yields that has eased back we got the apple headlines the average stock is doing better than the s&p. 3800 or so was the october highs and that's the next hurdle you want to monitor.

seasonally there's fuel in the tank, at least one would think there's a chart that's been making the rounds and has for a while about the tendency of midterm election years to finish very strong. midterm election years in orange, typically we're down into october of course down a lot less on average than this year and then it's a pretty dramatic recovery typically beginning in october into december. this is not necessarily, of course, a guarantee. 2018 was a midterm year and you had a bad fourth quarter the point being there's fuel in the tank in terms of sentiment, in terms of seasonlals and you can find it with perhaps yield calming down. >> the yield is the big question thank you, mike. news out today that a french company has pled guilty and paid more than three-quarters of a bill resulting from a u.s. federal charge that the company made payments to isis and another terrorist group to keep

a cement plant operating in syria in 2013 and 2014, as isis was kidnapping and killing westerners the company, lafarge, paid more than $10 million to terrorist groups >> so good to see you. lisa, thank you so much for joining us how on earth does this happen? >> what we've seen today is the first time ever that a corporation has pled guilty, been charged with and pled guilty to providing material support to terrorism the most notorious, brutal and notorious terrorist groups this world has ever seen. >> these were just cash checks to isis in order to be able to do business in syria >> they were paying isis for protection and for muscle, but also to undercut their competitors and get a business advantage. they were making a business decision but it was not a decision that was theirs to make it is against to law to pay money to a designated foreign terrorist organization, which

was isis here. this was happening in 2014, the summer of 2014 at the same time that isis was brutalizing the syrian people and killing, murdering innocent civilians, innocent americans, journalists, aid workers so this is a truly horrific case what we're seeing is a cautionary tale to companies, multi-national companies doing business as they are every day in this very complex world today in high-risk environments. and boards and ceos need to be very vigilant about their companies operating there. >> this was personal to you, because during these years or some of these years you were running homeland security for the united states. did you have any idea that a french company was paying isis at the same time you and the rest of the u.s. intelligence community were try to go put a stop to them >> no, we didn't and this was, as i said, in the summer of 2014 isis is going across iraq and syria waging a horrible, brutal

civil war and undertaking the most brutal acts of terrorism, both on the syrian people and against americans, innocent americans they kidnapped and murdered. >> do you think global corporations are making the same type of decisions now? we've got ukraine and all sorts of conflict zones around the world. are companies deciding on a business basis to be in business with terrorists now? >> look, this is what we want boards and ceos and general counsels to take away from this kiss today, which is that now more than ever companies are operating in high-risk environments all around the globe. boards and ceos and general counsels need to be hypervigilant about those operations, they need to be really paying close attention to doing deals with companies, with other companies operating in those environments they need to be doing due diligence, they need to be investing in compliance structures so they can detect this type of activity and report it to the government. >> now, the initial reason we had scheduled for you to be here today was to talk about cryptocurrency because we've got a big documentary on this

fascinating couple that you arrested and charged earlier this year with money laundering more than $3 billion in allegedly stolen bitcoin hea heather -- you seized more than $3 billion worth of currency earlier this year. can you tell us what's going to happen are you further down the process of deciding who is going to get the money? >> this was the largest financial seizure ever that happened at the time and the largest seizure of cryptocurrency that investigation and case is ongoing and victims, individuals and entities whose money, who claim that's their money, that they were victimized by this money laundering scheme will submit claims ultimately to a court who will decide how that money is dispersed. >> so somebody is going to get those crypto bills but we don't know who yet. >> that's exactly right. >> thanks for being here sara, back to you. >> look forward to the doc from you.

thank you, lisa. when we come back, we're going to have much more on this market rally the dow is up 333 points netflix is under pressure ahead of earnings after the bell we've got a top analyst on whether investors should buy whether investors should buy ahead of the results next.m whe. power e*trade's easy-to-use tools make complex trading less complicated. custom sp you find new trading opportunities. while an earnings tool helps you plan your trades and stay on top of the market. and i'm going to tell you about exciting medicare advantage plans that can provide broad coverage and still may save you money on monthly premiums and prescription drugs. with original medicare you are covered for hospital stays and doctor office visits but you have to meet a deductible for

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we are now in the closing bell market zone cnbc markets commentator mike santelli here today. we await results for netflix dow is up 327. s&p 500 is up 1% we've had a nice final session we're off the highs of the day but back-to-back gains encouraging? what do you think? >> not bad in a strange way, maybe a 1% gain is better than these huge big bites that you get on the kind of short covering rush to grab for exposure type rallies we've had in the past month. the equal-weighted s&p is doing better there's a drag from things like apple. you don't want to draw too many

conclusions, because as i said, still not back up to the october highs. there's a lot of work to do but enough dry powder out there that people are getting a little bit of confidence that it could run if you have the right things line up. >> the dollar is stronger, which is sort of a point of caution, although yields are a little lower today. goldman sachs is higher after beating estimates, a soaring bond trading offset a big decline in investment banking. leslie picker joins us dave solomon gavecautious comments earlier what does that say about the environment for goldman sachs, its deal making and markets exposure >> there's an important correlation. he said on the call that he's talking to ceos who are, quote, rethinking business opportunities. they would like more certainty before committing to longer-term plans. so he expects that lack of confidence to continue throughout the fourth quarter. this quarter, though, investment banking revenue was down 57% from a year ago, 26% from last quarter. the firm said its overall

backlog was essentially unchanged from q2. equity underwriting, biggest declines, but not far behind was corporate lending, specifically acquisition finance, which saw declines of 77%. volatility and uncertainty wasn't all bad, while price swings on fixed income currencies and commodities drove a 41% revenue. so you did see declines on the top and bottom line but some of these areas that were more benefitted by volatility were able to offset the slump in ceo confidence, which caused a slump in deal making, sara. >> mike, clearly the volatility is helping firms like goldman, we've seen that in some of the other results. how does the stock stack up relative to some of the other banks that did better on the lending front and, of course, on the net interest income like bank of america and wells? >> been lagging a bit. goldman sachs really has traded right along with morgan stanley.

even though the business mix is quite different between the two. it's interesting, because it's not as if goldman is really held back by the same concerns that the bigger retailer banks are, which is credit and things like that it's really just about deal activity and the fact that investors tend not to really want to pay up that much for trading profits, even though goldman has proven it's a franchise and it's relatively consistent it's just not something that they've put a multiple on in this environment. >> it's hard to tell the sustainability as well goldman sachs up 2.3%. netflix is up double digits in a week but lower ahead of the bell mark, what do you expect? anything different than what the market is expecting? >> i think the real question, we already know the ad product is coming out in early november across 12 countries and we know what the price points are. what the market wants to know,

are you coming into this from a position of weakness or real weakness they missed two quarters in a row. the market is expecting around 1 million sub ads. the market's interpretation is this ad move is really a sign of how weak the core business is, so that's going to be the over/under they have the biggest launch catalyst >> are they coming at it from a weak spot or a really weak spot? >> i think they're coming at it from a weak spot but not really week i think they'll make the sub numbers for this quarter, around 1 million, and that's not that big of a number. the street is looking for $4 million for the fourth quarter this is the global leading streaming platform it is a business that's now consistently gap operating profit positive and we're also

starting to see an inflection point in terms of free cash flow so this company was probably a year or two late in terms of launching this but that's the past growing forward i think it's a smart initiative on their part i think the $6.99 price point is super aggressive, which is exactly what netflix, given its platform power, has the ability to do. i like netflix, it's one of my favorite stocks for the next 12 months. >> doesn't it depend on having a big release? they had the last "stranger things." that did well. do they have anything going on when is "bridgerton" coming back is my main question. >> the way i think about it is they've got 17 billion shots on goal so you talked about "squid game" a year ago and nobody knew about it prior to it becoming a viral hit, the dahmer series out now, and it's become a mega hit and netflix has the platform potential to really take anything and thrust it into the

zeitgeist. there's 220 million paying subscribers and maybe half a billion people on netflix. what's the next big content hit? i don't know but they've got a series of movies that are coming out, series that are coming out and then they do return some that have a lot of popularity it's more competitive than it was in the past and i think netflix just responded to that with the price cut i think they've set themselves up well. >> what is the bear case, mike santoli, as the stock has gotten hammered this year and over the last year? >> the bear case in general is that it's kind of profitless prosperity among streamers in general, where netflix has the greatest scale but it seems like it's a fast maturing user base, the pie isn't growing that fast. the ad-supported tier from netflix has done a lot of what it was intended to do, which is to change the subject, start a

revenue stream from to zero and re-orient people's attention away from just quarterly sub growth and the fully paid model. i think that's interesting, as well as skreptical sentiment, ad i think the bull has been run out because the stock did get pounded so badly in past disappear pointments mark mahaney, thank you. two minutes to go in the trading day. what are you seeing? >> pretty positive the index level has wavered a little bit but you have solid numbers here it's better than four-to-one or thereabouts, so nothing like yesterday's 90% plus advancing we have bad home builder sentiment numbers and yet the home builder stocks have managed to retain some traction.

on a one-year basis it's lagging, but in the last several months it's held up okay maybe the pain has been taken in the market's estimation in terms of what builders might have going forward. volatile index has been sticky, above the 30 level jumpy one-day moves and too much bond market volatility for the markets to fully relax so you see it's off the highs but still in that little bit of an uptrend since august. >> i would add the dollar above and yen above $1.49. strong dollar, higher yields i would note that bonds are unchanged right now into the close. let's show you where we are. 327 right now on the dow high of the day was more than 600 points higher but we have rallied in this final hour and kept the momentum going. the biggest contributor to the dow gains, goldman sachs saw better earnings, adding 44 points salesforce adding about 40 points after david faber reported the starboard stake

american express, home depot, mcdonald's, a big contributor to the gains. every sector is higher on the s&p. we're up 3.8%. the best performer sector today is industrials the worst is communications, as much ass, held back by netflix. >> sara, thank you very much welcome, everybody, to overtime. i'm scott wapner you just heard the bells and we are just getting started it is about to get real in the ot netflix earnings are imminent. julia boorstin is standing by with everything you need to know and you will hear from her momentarily. we also have investment strategist here to break it all down we're going to kick around the valley and get your view on how