you founded your kayak company because you love the ocean- not spreadsheets. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire and welcome, everybody, to "power lunch." alongside kelly evans i'm tyler mathisen. a lot of news to get to including a looming strike by the united autoworkers union if they don't get a deal by midnight there could be targeted strikes as soon as tomorrow. judge big the comments by both sides they don't seem close at all. another las vegas casino company hit by a cyber attack. caesars says it paid the ransom

to the hackers. mgm says it's still trying to get back up and running after hit earlier in the week. we'll get to all that plus dr. scott gottlieb joining us to talk covid and decongestents. let's kick it off with a check on markets in a much firmer tone. not only 1% gains across the board today, but the s&p and nasdaq are trying to put together four gains out of five as the tone has improved of late. at&t shares are higher today. the cfo was speaking at a conference with some bullish commentary on free cash flow. investors may be taking that to mean the dividend is safe. the significance is that at&t is one of those stocks we talked about yet where the dividend yield, there it is 7% on your screen, is higher than the forward p/e which is six times forward earnings. at&t up 3% today. netflix is continuing to fall after comments from its cfo

yesterday about the slow pick up of the ad tier with the 2% drop the stock is down almost 9% this week. >> all right. and the big stock story of the day, the arm ipo opening at 56 a share, $5 ahead of where it priced, trading right now at 59.74. that's $8 ahead of where it priced or 17% higher on this opening trading day. let's bring in leslie picker for the details. hi, leslie. >> tyler, the biggest ipo of the year up and running, arm getting a boost in its first day of trading with a listing here at the nasdaq. its owner softbank sold all $5 billion worth of this offering, and it s customers, apple, amd, nvidia, and others v indicated interest in purchasing roughly 15% of the float. this is a seamless debut. you can see the stock is up about 17% right now in a relatively shaky market for new issuance. the market has been closed for the better part of the last 18

months. to minimize risk, softbank opted to sell a small amount of company, about 9%, of the total valuation being sold in this deal. they signed up strategic investors, the customers and they didn't price too aggressively relative to the range they had been marketing. just at the high end there. now a smooth debut bodes well for the other ipos in the pipeline. shares of large banks those are trading higher today with bank investors looking for a bona fide reopening of the ipo market. you've got marketing tech firm klaviyo on the road, grocery delivery company instacart marketing its deal, birkin stock just filed its f-1 waiting in the wings. it's a little more than green chutes. we're starting to see real activity come to the market, but, of course, that's why the stakes were so high today and that is why today's performance bodes well for the other ipos in the wings. >> arm is a money making

company, correct? >> money making but those profits did decline in the first six months of the year. >> all right. leslie, thank you very much. we appreciate it. and now we're about ten hours away from the uaw's deadline. if they don't reach a deal with ford, gm or stellantis by midnight we could see autoworkers go on strike. phil lebeau is in detroit. doesn't sound like they're close to a deal and the strike might look kitchen, is that right? >> that's correct. we do not think there's going to be an agreement by 11:59 tonight. we could be wrong. all indications from the people we talked with are the two sides are far apart. we will see some type of strike likely with each of the automakers. here's the latest on the uaw contract negotiations. for general motors it was a new offer this morning, we don't have the details but they have been increasingly going back to the uaw with new offers and ford doing the same thing. jim farley last night at an

event here in detroit expressed his frustration that the uaw is in his opinion not coming back to the table with genuine offers. for the uaw the president says he will unveil a list of strike targets tonight at 10:00. and while they are not saying what those targets are just yet, a source has indicated that there are eight transmission and engine plants in the upper midwest likely to be hit starting at midnight. these are big plants talking about ford's transmission plant just outside of detroit. there's the stellantis facility in atlanta. those are massive plants that supply transmissions, engines to the most profitability models. the uaw when we asked them, said we have not finalized our list. as you take a look at shares of gm, ford and stellantis, keep in mind that strike deadline is at 11:59 and they could be at midnight that we start to see

uaw members walking the picket line. >> there are different negotiations with all three of the different companies, correct? and is one of the big three, ford, stellantis, or gm, closer to a deal with the uaw than either of the others? >> your guess is as good as mine. we were told over the last couple days, look, i think ford is the closest getting a deal done with the uaw and yesterday uaw president shawn fain blasted ford again and that was enough for jim farley to say, forget about it. we've had enough of this of him posturing in public. we are not getting the negotiations from the uaw. that blows that idea out of the water that ford is closer to a deal than gm and stellantis. my gut tells me based on people i've talked with we will see a form of a strike at all three of the automakers. not all walking out in mass, won't be 150,000 uaw workers on

strike, but targeted if all of these plants in the upper midwest we've been told will be hit. if those are hit that's what we're looking at? >> thank you very much. you'll be all over it over the next 24 hours and probably longer than that. how will the united autoworkers strike hit the big three? rbc has done the math on a 20% wage increase and said it wouldn't have a huge impact on ford's earnings and also ellen hughes says a long strike could set back the big three in the ev transition among other things. ellen, let me start with you and talk to us about ford. how far apart do you think these two sides are and has the atmosphere been sufficiently poisoned that there is very little chance of a settlement before midnight tonight? >> well, i think phil had a very good summary of where we stand

right now. if you had an opportunity to listen to the live stream of uaw president shawn fain last evening, you may have walked away with the impression that there are substantial differences across all three companies and what the wuaw is demanding. these are demands that come after a period when the deep three have recovered from the global financial crisis. it took many years before they were substantially profitable again, so now they're in a very healthy position and, you know, let's hope that they come to some agreement so we can move on to what is at stake here, our competition in the ev market. we have to be ready to invest

big time in retoo long these plants and getting evs on the road. >> tom, what do you think here? is the uaw seeking -- obviously, they seek to benefit, another phrase would be take advantage of, but to benefit from some of the profitability that ellen just referred to there. they deserve their fair share of it, and anyone would say that. but do they want to effectively go back to the way things were pre-financial crisis with respect to wages and particularly pensions, which are part of this deal? they want pensions, not just 401(k)s, pensions. >> yeah. i mean, i think the way to look at this, we're in a different world now. the auto industry is very different than when it was pre-gfc, certainly. it's way more automation. i think the oems have more bargaining power than we give them credit for. the other thing i would like to

note is, they're a lot healthier post pandemic. they're really a lot healthier and they're better earnings drivers because of high pricing. so what happens if there is a work stoppage? that means volumes actually stayed down, inventories stay lower, pricing goes higher. i do think what's missing in a lot of this, the automakers could keep pricing elevate and record profits high. it sounds optically bad for gm, ford, and stellantis to say a strike is bad, but we can't forget what's been happening -- we've had three years of shutdowns, right, pandemic, semis, russia-ukraine and record profits because of it, because volumes are lower. in a weird way i don't think this will be as bad for the oems. look what happened in 2019, look what happened to gm. quick snapback right away. i did math on the labor costs. labor costs lower than what it was historically as a percentage

of cogs. 20% labor increasing for ford results in less than 100 basis points of margin decline and they can offset that with the higher prices that come with lower production. so i think a lot of this may be kind of overblown. i actually think it could make these oems bizarrely healthier than people give them credit for. >> if we take a step back, stellantis is trading at 1.5 a times ebitda basically, ford shares single digits and have been for years, gm nowhere, and china is at risk of flooding the market with cheaper electric vehicles. i mean, what's the long-term prognosis for these companies who are trying to sell $120,000 electric f-150s or whatever? >> i think you're absolutely right. i think a lot of people are missing another big thing. the ira is a huge transfer of capital from the u.s. government

to consumers and to these oems. i used to be a european auto analyst and i can tell in europe you don't have this support from the government. the u.s. automakers stand to really benefit significantly. for gm it's $73 billion to consumers over the next ten years to buy evs. i actually think that the u.s. is in such a really well position. doing evs with battery makersin the u.s. in europe you can't do that. why? they have to export to china and they don't want to anger the chinese and they're allowing the chinese to come in. i think the u.s. oems are poised to do very well with electrification thanks to the ira. >> why don't you react to what tom said and specifically, i don't mean to put words in his mou mouth f i'm hearing him correctly he thinks a strike might not be a mitigated disaster for the oems. >> tom, i would sort of disagree

with that premise. i think really in some sense it depends on how long the strike lasts. if we're talking about 30, 45 days, 60 days and don't have a contract that leads to substantial cash outflow. right now, for example, ford has cash net of debt at about $10.3 billion as of the second quarter. gm has $8.9 billion. now granted, they have a lot of liquidity because of a their credit lines. ford has 47 plus billion in liquidity. gm has 38.9 billion. they have, you know, funds, they have cash on their balance sheet, but if you're talking about a strike that's really hitting transmission plants, engine plants, and now we're talking, you know, 30 days, 45 days without an agreement, now we're talking about the cap x

they have in place to make the transition to evs that capex is at risk. i think of persistent strike is not good. secondly, it's not good for morale. it's so important when you make a transition on a technology to have a aligned incentives and everybody is on the same team because they have to make sure they can be competitive. they have to go into this and, you know, china is moving into europe. europe is going to respond. we have the ira. they're going to have their own ev policy coming down the pipe. the competition suspect going to be going to be easy when it comes to evs. >> ellen hughes cromwick and tom mar, on, thank you very much. >> thank you. coming up on "closing bell: overtime," jim farley at 4:00 today. we'll get the latest from the

head of ford at 4:00 p.m. on "closing bell: overtime ". >> looking forward to it. crude oil coming back above $90 a barrel for the first time this year. we're still above that level as you can see by a couple of pennies. what's causing this latest rally. we'll talk about it and a power check as we head to break. norwegian cruise lines on the positive side on an upgrade today. redburn saying the pandemic ache is finally over. e f meanwhile, visa is one o thworst performers on the s&p 500 and on pace for its worst day in nearly a year. also the only name on the dow in the red. we're a back after this. power e*trade's award-winning trading app makes trading easier. with its customizable options chain, easy-to-use tools and paper trading to help sharpen your skills, you can stay on top of the market from wherever you are.

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welcome back to "power lunch." a.i. is back in focus in washington and wall street. the so-called magnificent 7 up 95% this year while the s&p up 17% and a those companies, apple, microsoft, nvidia, amazon, google, tesla and meta they account for most of the s&p 500 gains. our next guest says there are opportunities ignored by chasing those trends. let's bring in richard bernstein, investment officer of richard bernstein advisors. i didn't take you for a mag 7 chasing kind of guy. >> certainly not, kelly. i think, you know, the notion of the magnificent seven, i would ask rhetorically, are there really only seven growth stories

in the entire world, and clearly the answer is no. i think people are missing many of the opportunities around the world, even in the united states, but around the world, simply by being myopic on these seven companies. >> let's back up for a second. some might say the biggest opportunity in the world is nvidia, you know, just never seen a company double revenue in a single quarter from the scope of 7 to $14 billion and only 35 times multiple. >> right. i think, kelly, you know, i think they have to separate out when people talk about artificial intelligence, i think we have to separate out the story from the investment opportunity. i'm not talking about investment opportunity in the next two weeks or two months. i'm talking about, you know, the next year, two years, whatever. and i think the -- a perfect example of a perfect analogy would be the technology bubble in '99 to 2000, where all these

promises made about the internet, and the internet changed the economy in more ways than we could ever have imagined. what i'm doing with you, nobody could ever imagine that was going to happen 20 years ago. but the interesting thing is, if you bought into the tech bubble a year before the bubble peaked, you still didn't break even for 11 years. so i strongly doubt that people are being caught up in the a.i. hype saying, it's okay, i'll break even over the next 11 years. they think they're going to make a lot of money quickly and it's going to be sustainable and these are the great growth stories going forward. i think we have to separate out what's going to happen in the economy to what's going to happen in the stock market. >> let's talk about the other growth stories you refer to in your first answer. where are they? what are the names that people should be considering, in what sectors if they're not the magnificent seven of technology? >> my favorite example of what we're talking about, i don't want to name individual companies, but i think my

perfect example of what's going on, i'm sure everybody watching us knows arkk, it came fluk october 2014, coming up on nine years now. over the nine-year period, small and mid cap industrial and small and mid cap capital goods companies have outperformed arkk. i think the market has turned the page underneath the surface here the market has turned the page and looking at new growth stories. i would argue those related to more real productive assets than to the hype of the metaverse and a.i. and all that stuff. >> you don't have to be sexy to be good here? >> no. i think -- >> that's good to be both, right? just -- >> i think the way to think of it, using your sexy analogy, i'm not going to take credit for that, but your sexy analogy

think of the market as a seesaw. on one side all the sexy investments going on right now. they did very well in 2020. 2022 the seesaw leveled out -- 20 1 rather, and 2022 went in the other direction. clearly in 2023 the seesaw has gone in the other direction but down to seven or ten companies. i just can't be that bearish to say there are only seven growth stories in the entire world. i think the opportunity set on the other side of this seesaw is maybe historically broad and attractive. >> rich, thanks very much. richard bernstein. we thank you. >> great seeing you. >> same here. much more to come on our program but as we head to break join us for our delivering alpha summit two weeks away, september 28th in new york city. investors, business leaders, going to provide ideas and insights to help you balance risk with maximized return. the content is going to flow like a fire hose, man. scan the qr code on your screen

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welcome back.

another hootter than expected inflation read out this morning. bond yields not really reacting. let's ask rick santelli. >> i don't know if they're not really reacting, they're acting a bit different than yesterday. let's go through it. today we had a couple things we should point out with regard to ppi august release. it was the highest month over month change since june of '22. year over year ppi, ex-food, energy, and trade, it was 3%. it's higher than expected. a higher revision. at 3%, it really does underscore some issues with regard to lingering aspects of inflationary pressures. it isn't only energy, although to say energy is less important or not important or to strip it out and ignore it is definitely a big mistake. let's look at intraday of 10s. the volatility around 8:30 eastern and what happened afterwards. we moved higher in yields. look at yesterday when you pair

a two day. yesterday it was the opposite. in my opinion a hotter more important cpi and yields moved down afterwards. the problem with these things are, kelly, is that markets don't send out memos. they don't say the reason market yields move down is because of x, y or z. so many put it together, the markets were happy with yesterday's cpi. i disagreed yesterday and today. there are other forces at work here. and yesterday's yield high intraday you pointed it out, was 4.34% before it dropped. open the chart up one month. the high yield close on the 21st of august was 4.34%. that is a very key level and even though this is slow moving motion picture of higher yields the session we closed above that is going to be another technically significant session that pushes yields more to the upside. finally all of that and the perception that the ecb is done

after their tenth consecutive rate increase, whether true or false, whether the euro currency broke, interest rates moved and closed at the lowest level pending their close in six months which usually means, and it does the dollar index is pending its best close in six months as well. tyler, back to you. >> rick, thank you very much. we have oil, 90 a barrel. pippa stevens here to explain. >> this is the first time wti has topped the 90 level since last november. brent crude around 93. 72 right now. this comes after the latest reports from the iea and opec said we would see supply deficits through the remainder of the year. we have this tightening physical market supported by strong demand as well as saudi arabia signaling they will do what it takes to keep the floor under prices. on the flip side you could argue this tightening market has been very well telegraphed and the run up in oil is priced in and

oil is over bought for the first time in a year and a half, so it really does speak to just how quickly the sentiment has shifted from very negative to maybe perhaps a little bit too positive here. now energy stocks are higher. one area to watch is the services names because with wti at the $90s level we could see the private players bring production back on line and they're about half of the rate count. it's a meaningful statistic to watch. clean energy stocks also higher today. just got back from the conference in vegas the largest clean energy conference with more than 40,000 attendees and the mood was optimistic on the long-term side but in the near term seeing challenges particularly for residential solar and they keep pushing out when is the bottom going to be. we keep hearing maybe next quarter and that gets pushed out. >> how much carbon was expended at that and people getting there. >> everyone walked. >> yeah. exactly. >> took electric scooters. >> vegas is known for electric scooters. >> and energy efficiency.

>> how is the winter going to affect oil prices? not just winter heating season in the united states but around the world and factor in the ongoing issues of the war in ukraine? >> we see the relationship between oil and gas and even coal and renewables where if one goes up you start shifting to other sources and that makes that one go up. i think right now things are looking, you know, more or less pretty stable given that europe especially is very full in their storage. they're over 90% now and ahead of schedule there. i think what we've seen in recent years is that the increasingly erratic temperatures we're seeing means it's hard to plan. the iea say they were going to see fossil fuel demand and what signal does that send to fossil fuel companies in terms of infrastructure investments and things like that. one of the issues is that it can seem steady right now bths, but all it takes is a storm that knocks out refineries that pushes up gas price ts that

changes the dynamics in the market. a lot still to watch here. >> snowballs. thanks. appreciate it. >> let's get over to steve covac for the news update. kelly, yeah, federal prosecutors indicted president biden's son today on gun charges. hunter biden faced three counts tied to possessing a gun while using narcotics. the case is being overseen by david weiss. each of the counts carry a five to ten-year maximum sentence and $250 maximum fine. also india is stepping up contact tracing and testing some 700 people as it tries to control the outbreak of a deadly virus in the southern state of corala. two people have died nipah virus and two adults and a child are receiving treatment in the hospital. nasa is planning to name a new chief for ufo research.

the announcement during an expert panel on what the government calls unidentified anomalous phenomenon. a study found no signs that reported sightings were extraterrestrial but bill nelson believes life does exist behind earth. the truth is out there. >> i hate these stories. i do. >> i love them. >> i know. >> everyone does. i'm the only one. thank you very much. ahead on "power lunch," new covid booster shots hitting the market. the cdc recommending them for sebeyone 6 months and older as cas gin to climb. what you need know about the latest variant with pfizer board member dr. scott gottlieb. we're back after this.

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welcome back. a couple key stories in the health care and pharma industry that caught ourattention today. "the new york times" out with a story saying a decongestant in many cold medicines is ineffective according to an fda

advisory committee and the cdc endorsing covid-19 boosters for everyone 6 months and older as cases rise and a new variant takes hold. here now to discuss, dr. scott gottlieb former fda commissioner, cnbc commissioner and board member at pfizer. i'm right, aren't sni. >> -- aren't sni. >> that's right. >> let's start with phenylephrine, the ingredient in question here that kind of replaced decongest ntss with pseudo ephedrine and why are we finding out years later phenylephrine may not be effective? >> that's right. so back in the 2006-2007 time frame pseudoephedrine was put behind the counter because it was believed people were making methamphetamine from it.

not necessarily people manufacturing it off sue do ephedrine. that product was put behind the counter. before that event phenylephrine i wouldn't say was a seldom used product but wasn't as widely used as it is now. after pseudoephedrine was put behind the counter phenylephrine was more widely used. this was never believed to be a very effective product. the presumption it was weakly active and short acting. the effect lasts about four hours with oral phenylephrine, but it was believed to be active nonetheless. we look at this closely back in 2006-2007 when sudafed was put behind the counter. the studies were never well done by modern standards. there's been subsequent studies since then, none of which have shown a strong treatment effect. it's caused the fda to reassess this and come to the conclusion the advisory committee did it there's no strong evidence suggesting this drug is

effective. there were a lot of methodical problems that looked at the efficacy of this drug not least of which it looked at patients that it didn't work in that, setting. it would take a large, well powered study for the treatment effect here and we don't have that evidence. >> if i have a cold or a flu and i have nasal congestion, what should i do about it? >> use afrin or something like that? an over the counter nasal spray that does the trick? >> well look i still believe personally that with the totality of the evidence that phenylephrine probably is providing a treatment effect here, albeit a small one, and a short acting one. it's not providing long-term relief. i think it is providing an incremental benefit to some patients. if this project isn't available and people don't want to use it now, kee mind the fda didn't

raise safety questions about the product, the product is safe, how much efficacy is it delivering but if people don't want to use its, there are other products on the market all of which have shortcomings. use nasal preparations like nasal steroids, things like afrin which, that can cause rebound if you use it for a long period of time. i suspect if phenylephrine is taken off the market you will see more homeapathy put on store aisles. i'm not sure there is a good opportunity for an oral that can provide some benefit. all that said, i don't think the fda will withdraw these products from the market. in all likelihood what the agency will do is probably relabel them to maybe take out the indication for allergic rhinitis which is an indication we know the products don't work and they only work in the setting of a common cold cause a something transient nasal congestion. >> is pseudoephedrine more effective the stuff behind the

counter? is it more effective and should i ask for that? >> that's certainly the case. i mean i would, if a consumer doesn't have side effects associated with it, that's a more effective product. it's more expensive, behind the counter now, prices have gone up since it's been positioned there and that's part of the challenge. having something accessible to people to relieve some of the symptoms of a cold so that you can improve productivity and just general well being. >> dr. gottlieb, so the -- maybe i'm not the only one slightly confused what to do on the covid front. the cases are everywhere all around us, but there's misunderstanding if you've had the boosters i guess going back a year or two ago, are you fully boosted? do you need the new boosters and so on and so forth? what's the latest advice? s. >> i think these covid vaccines are like a flu paradigm in terms of receiving updated boosters on an annualized basis to have

protection for that season. we know that matching the vaccine to the current variants provides some incremental protection in terms of against infection and recency matters. having a recent vaccine and infection for that matter provides stronger protection, the protection from the vaccines do wear off over time. i think you can expect to get three, four months of more robust bust protection from a recent vaccine. the protection against infection is going to decline. you will have residual protection against more symptomatic and severe disease. for people who need the protection, people at risk, people who want to reduce their chance of getting infected to the extent that vaccines still do that but on less of a basis certainly than they did when they first came out, getting an updated vaccine this fall is something that's prudent and i would urge everyone to consult with their physicians and make an informed choice whether or not they will get an updated vaccine. >> you hit on something that interested me for a while. did the public misunderstand,

did drug companies not know, or did drug companies oversell the effectiveness and protectiveness of vaccines against covid? in other words, when we typically think of being vaccinated against an illness, we think that means we're to the going to get that illness, and it turns out in the case of covid, the vaccine did much good and prevented more serious illness, it didn't seem to confer the kind of immunity that we -- bless you -- she's good. mask. not covid. that -- you see what i'm driving at here? >> yeah. it's a great question. >> did we not understand it or where? what is it? >> i wouldn't blame the public for not understanding. public health officials didn't communicate this well. when the vaccine first came out people were careful not to say that the vaccine protected against infection because we didn't have data. the data initially showed the vaccine protected very well

against symptomatic disease and severe outcomes. there was subsequent data initially out of israel showing that it was very effective at preventing transmission and infection all infections and that really gave people a lot of optimism that the vaccine could be used as a tool to effectively end the pandemic. and so you saw the messaging change. i think what people didn't anticipate is that the virus was at that time starting to mutate and once the virus mutated to more infectious forms it was going to become harder to develop vaccines to provide the same level of protection against infection. that's where we are today. this vaccine is much more ineffective and coming up with a vaccine that will afford the same level of protection against infection is what we enjoyed initially with the original strain of the wuhan virus and the original vaccine. that's probably going to be difficult. at least with the vaccine technologies that we have today it's going to take a different technology that vaccinates against more epitopes on the virus before the level of protection against infection. that doesn't mean you're not getting any protection against

infection, but it's reduced from what we had with the first tranche of vaccines dealing with the wuhan variant. we're dealing with a different environment and it's like the flu. you get the flu vaccine, you're going to get protection against symptomatic disease hopefully if you get the flu won't be as severe. you'll get some protection against infection with the flu. people still get infected after being vaccinated but the flu vaccine does provide some protection against infection. so your chances of getting infected go down. i think the same thing is true with the covid vaccine. it does provide protection against infection. but substantially less than what we had when we rolled out the vaccines against the initial variant. >> it's really the mutation of the virus as much as anything that explains this potential misunderstanding. scott gottlieb, doctor, thank you for being with us. >> thanks a lot. >> coming up, arms reach. arm holdings finally makes its long-awaited public redebut. it's a big win for softbank's masa. the shesar are just under $59.

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welcome back to "power lunch." arm going public today and having a pretty successful debut. the stock pricing at $51 last night and opened around $56 and we're trading at $58. it's a big win for softbank's masa, and he kind of needed it. let's bring in deirdre bosa for today's tech check. the market cap in the neighborhood of what he paid when he took full control last month? >> that's why i don't think we can call it a win just yet. maybe it's a successful ipo because it's up more than 10%. a healthy pop you could call it. a lot more than this and softbank and masa left money on the table. as you mentioned, kelly, it is below the $64 billion that softbank paid to get a piece of it from the saudis not long ago. so still have to see, but you are right, masa does need a win. he has hung his entire legacy on him being central in this shift to artificial intelligence. he's been talking about it for

many, many years, not just when it became hot and busy this year. there's been missteps along the way. he talked about nvidia and asked if he was able to sell arm to nvidia a few years ago that would have been a huge win, bigger than what we're seeing today. undisputable. but he did buy nvidia in 2017 and sold it about a year later, made $3 billion. it leaves us sort of with the question that many ask about masa son's legacy these days, is he a great investor or just lucky? remember going back to the turn of the century he invested in alibaba for $20 million. at one point it was worth more than $100 billion. he needs another win of that scale to keep that legacy going. >> is he kind of in the same sense, you follow this much more astutely and acutely than i do, venture capital companies that put money to work may invest in ten startups, ten embryos. >> yeah. >> and seven fail.

but if they get one right, they ashs dnds really right -- they're set for the next decade. is he that kind of investor? >> he is that investor on steroids. there's a phrase we use call spray and pray. so maybe a decade ago investors vcs would look at tech companies and get one. he looks at 100 and hopes for one win. so this is in a different league. this is akin to a different era. the baseball era when, you know, steroids changed the whole idea of what it means to get a home run. so this is different. but yes, it's that idea on steroids. >> all right. well put. got it. thanks. coming up, we'll ask our trader why she's not touching any ipos right now, including arm. ev three stock lunch after the break. le? with comcast business... it is. is it possible to use predictive monitoring to address operations issues?

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time for today's three stock lunch. we may get to two. first up on the menu arm holdings open for trading $56 a share after setting its initial price at $51. it is at 58, up 15%.

danielle shay, trading vp of options. you said you wouldn't be a buyer of any ipos right now. why not? why not this one? >> that's right, tyler. it's because of the ipo environment. when you look at the last 50 ipos that hit the market only five of them are trading at or above your ipo price. so i think traders and investors can get a much better price on the stock later on, and ideally they can buy them by purchasing some -- selling some cash secured puts and getting into the stock in that manner. >> all right. so we seem to have lost your video, but we still got your voice. stay with us as we move on to the next stop. >> which is netflix. this is another interesting case where is it emblematic of an entire industry or not. netflix down for the second straight down about 9% in a week now. seem to be concerns about pricing, profitability, what would you do with it here? >> so when you look at netflix,

yes, it's admittedly a little bit dicey. we have high volume selling right now and right now it's at the $400 price point. here's the thing. i'm looking at netflix and i generally do like the stock to trade higher before earnings. when we're hitting next week, we're going to be entering the 21 bar time prior to earnings and i still like it for a buy, but it has to hold 400. if it holds 400, then you can look for on average about 5% up move going into the next earnings report. but a break of 400 we will see a flush down into 375. >> and then anything else you would say by extension for the rest of the space or just kind of leave it as a weak link? >> so the thing about netflix is that it can have these moves lower on bad news, right, but historically over time looking at the probabilities more often than not it still trades higher going into earnings. if you look at the october

season in particular, that one can be weaker out of the four quarters, but i still like the stock and if it can hold up above support i want to trade it higher going into the next earnings report. >> all right. danielle, thank you very much. appreciate it. danielle shay. sorry we lost video, but we got the meat of the discussion. coming up, speaking of which, the hack attack that's crippling vegas. g easier. with its customizable options chain, easy-to-use tools and paper trading to help sharpen your skills, you can stay on top of the market from wherever you are. e*trade from morgan stanley. power e*trade's easy-to-use tools make complex trading less complicated. custom scans help you find new trading opportunities, while an earnings tool helps you plan your trades and stay on top of the market. e*trade from morgan stanley. you can't buy great conversations or moments that matter, but you can invest in them.

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welcome back. las vegas casinos are dealing with a crippling hack attack. the stocks are slightly higher but contessa brewer joins us with more. >> mgm is still struggling to get systems back up and running, and i'm told the regional casinos have recovered computerized gaming system but las vegas is working manually. offering casino and dining and other guest options. fbi, other federal law enforcement are involved and earlier today caesars entertainment revealed it, too, was breached and criminals last week demanded $30 million ransom payment. i've learned that caesars has paid half of that $30 million. my sources tell me it was the best possible outcome for the company. i've confirmed that ransom demands have been made to mgm as well. intrusions hit different systems. caesars said it took some

customer data but not publicly exposed those. mgm communications were affected. the criminals didn't hack in. they were let in by a human being by social engineering. criminals targeting an employee either at the company or third-party vendors. it's a casino heist. >> are these casinos insured against the losses? >> they are. it will come in and cyber insurance pays a big part of ransom. >> thanks, contessa. >> that's why the cost of cyber insurance keeps going up. "closing bell" starts right now. welcome to "closing bell." i'm scott wapner live from post nine at the new york stock exchange. this make or break hour begins with the resilient stock market how even one of the greatest investors says he's a bit surprised at how well equities have done this year. we'll get to those comments and others from sid ta dell's ken griffin in a moment. a nice broad move.