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holding back above 4.5%, a bit of a troublesome or challenging level for equities. >> well said actually a lot of strategists say anything over 4.5, certainly over 5 we didn't just get the knee-jerk reaction yesterday, it continued today. we almost kissed 4.6. >> the government shutdown looming as well. >> you might think that would be an event that sends yields lower and a risk off but maybe that tells us how much things changed. 12:01 saturday will be the shutdown if no deal is reached we talked to emily wilkins last hour, it's better than 50-50 it happens at this point. now he also wants them to raise the debt ceiling >> yeah. >> i heard on one report maybe even eliminate the debt ceiling. >> right. >> which would take that impediment, i suppose, or that hurdle we have to deal with it seems every few months or every year at least, off the table plus, we're going to talk this hour to the ceo of carvana two years ago the stock was

trading at $4. where is it now? look at that, $226 don't you wish you owned that one? can this keep going? we'll talk about that and the market for used cars. >> really one of the great finance stories of the last couple years just incredible let's get to the broader market. you can see we're up 0.75% after the fed signaled fewer rate cuts than markets were anticipating for next year. one of our next guest thinks this is a great buying opportunity. our other thinks the fed will be on pause for the time being and could hike if inflation reignites. joining us for more is tom lee fundstrat's head of research and jeff killburg, kkm financial tom, i take it you think this is a buying opportunity >> this is another buying opportunity in our view. 2024 has proven to be a year where the market has been strong, and it has eluded many

opportunities for sustained weakness yesterday's pullback was really painful, but to us i think the fundamental supporting stocks are intact and it's a good opportunity for investors here. >> good opportunity for investors. jeff, i take it that you feel it's differently putting it too strong >> i don't disagree with tom on the fundamental side of it, but if you look at where we're at with interest rates, what's on the horizon from tax, tariffs and deficits i have to be considerate of what happened yesterday. the second largest move in the vix we have seen and historically speaking, tom is right, auto a month after that spike in the vix you see the s&p 500 higher i don't think we can leave out history due to the fact that we've seen stretched valuations in the top ten names of the s&p 500 and also seen just a straight line up if you look in the last two years back-to-back years of above 25%, we've become conditioned that the markets will continue to move higher thanks by and large to the fed dovishness and their $7 trillion

balance sheet. i'm looking -- tom wants to back up the truck -- i have the truck running but not ready to back it up i want to see this more process, reset valuation, i think that's the next couple months, possibly the first quarter. we've become too conditioned to markets reprising in a day i have to go back in my 30-year career and we will understand reset values a quarter or two not just a day or two. >> this has been a slide for the dow to put it mildly ten down days in a row you saw signs of capitulation yesterday as it was in 90% down day? >> i did, tyler. as context, the market has been bleeding lower if you look at internals for the last ten days. yesterday looks capitulatory not only do we have a 90% down day but the spot vix exploded by 75%. there's only four times in history where it's risen 60% in a day.

yesterday was the fifth time in its 35-year history. of those four times, the market recovered all of its losses within a week, three out of the four times, the fifth time it took -- the fourth time it took a month, so i think what you had was people panicking to get out of what they thought was a momentum trade that's ending because we're so close to year end but here's the interesting thing the forward vix futures curve barely moved almost as if people were seeking protection through the vix yesterday. >> what tells you more valuation resetting is to come >> i think due to the fact that we only had one down day typically when you see prices reset or revalue you have consecutive down days. those consecutive down days bring along particular begin calls. you saw brokers talk about his concern of margin being used on the mag seven. when i look at a day like today seeing passive indexes buoy the three major indices, nvidia,

facebook, these names are coming back because you see people deploy cash in a passive index i get concerned about that, short-term volatility. i will embrace this volatility over the next month or two i don't think history is going to line up this is not the same way we've seen a straight up move since last november and especially since november 5th after the election results i have concerns short-term cautiously optimistic at 2025. this is a depth charge that went underneath the water and there will be ripple effects >> let's talk about the small caps for a minute. they had these moments where they look promising and they go on a tear and then it just stalls out and a lot of investors are feeling frustrated and wonder if it's worth sticking around. >> i mean i would say investors are tired of having like the rug pulled on small caps yesterday is an example. unfortunately when markets get nervous and their risk off and of course buyers disappear, stocks that aren't as liquid get hit harder that's why the russell has not only been under pressure for a

couple weeks but got hit yesterday. do we think anything has undermined what makes small caps attractive in the next five years. it's still in place. they've under performed last ten years by the second largest magnitude in the last 125 years except for 1998, so not only are they derated but we have a road map of deregulation, possible mergers, a time when financials, a huge weight in small caps look more promising and things like biotech, a huge weight, look more promising, so i actually think this is another chance to buy a dip. >> let me ask both of you to respond to this idea and that is, that did the chair yesterday effectively or tacitly concede that maybe they moved to fast too soon in other words by cutting 50 in september again in november? what do you think, tom, and then

jeff, your thought >> fed fund futures were only pricing in two cuts essentially next year depending on how you wanted to look at the level of fed fund futures and the fed essentially agreed with that >> essentially agreed, yeah. >> so the fed sort of forecast just were not what the market was expecting. i don't think the market expectation is wrong i think it's better for the fed to be wanting to support the economy so in other words get to neutral, but the fewer cuts they do in 2025 actually is better for this bull market because it provides a lot of future ammunition to protect the economy. to me the idea of going from committed four cuts to two or potentially four to two, maybe only one cut next year i think that's a bullish outcome >> jeff? >> it felt like a confessional yesterday because the fed chairman he actually came out and said that their forecast for inflation really fell apart

towards the end of the year. i believe that they had to kind of catch up with the two-year note i go back to my career where i started in the u.s. treasury pits in the chicago board trade the bond market has always provided leadership. what's interesting now i think the 10-year can go to 5% before it goes back to 4% and with the way inflation is tra jektsing and moving higher the fed has moved away from their 2% target. think about it, ty, the fed have cpi go down to 1% to get near the 2019 covid levels. i know the fed may have to hike before they lower them again. >> we will see what happens. tom lee thank you very much. jeff you will stick around for just a minute because -- >> thank you. >> cnbc released our exclusive rankings of the most valuable college athletic programs and there is big money in college sports some of these programs valued at levels similar to pro teams. number one the ohio state

university at $1.32 billion. texas, university of texas, texas a&m and michigan valued at more than a billion, alabama just shy of that sixth place is jeff's alma mater notre dame the highest ranking private school and only school in the top 15 that is not in the sec or the big 10. they have a big game tomorrow night against my indiana hoosiers, where my son just finished his first semester, and i see you are wearing an indiana crimson coat this is a tell golden domer. >> don't misconstrue my holiday coat what's interesting no one really knew that indiana had a football team hat tip to the coach he has brought them to national prominence coming to south bend tomorrow, going to be snowy and i believe that notre dame and marcus freeman will be prepared to run the ball. go back to the most valuable

university we're sixth on that list but i could call lou holtz right now and he would talk about ryan day not deserving that number one spot it's fascinating to see the amount of money each one of these teams in these college playoffs are receiving about $10 million. if you look at the ohio state example you talked about making $280 million a year, if they're able to go all the way to the championship they will drop another 10 to 15%. 30, $40 million to their bottom line it's remarkable to see the amount of cash in college football. >> all right well i got to say go iu. there are a lot of -- >> go irish. >> go irish. thanks very much jeff killberg. still ahead, talk about a comeback story carvana shares worth less than $5 two years ago and today now they are sitting around 232. that's a 5100% increase. we'll talk to ceo ernie garcia about what's driving the turnaround story when "power lunch" returns

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welcome back to "power lunch. as we get ready to close out 2024 we ant to zero in on a standout stock despite a 3% drop today carvana is up about 325% this year alone, up over 190% since our april stock draft that has helped push the mentalist perlman in the draft, not just by a little bit. look at the margin of difference there. less than two months to go until stock draft. here for a "power lunch" exclusive ernie garcia, chairman and president and ceo of carvana. good to have you with us i think part of the story behind the remarkable stock performance 110% in the past six months is what you have done in terms of profitability and making the company much more profitable in 2024 than it has ever been, most profitable as i understand car dealer chain in the country.

how did you do it? >> oh, wow there's a lot to that question i think, you know, we're going to hit our 12-year birthday in january, so in just about a month and i think over that period we've had a ton of great people at carvana that care and have built a different business model from anything that's been available to customers in the past customers can pick a car in minutes and get it delivered to their door, as soon as same day now. we handle financing and everything else. i think the experience we deliver is one the customers love so we're growing faster than any other automotive retailer out there the economics of that business are different than traditional automotive retail so we give our customers a discount that's a powerful combination. we're only 1% of the market and there's a lot of room to run. >> how did you boost profitability specifically >> you know, that would take me a while to talk about and i think i would bore your viewers so i'm going to stay away from too many details, but i think it's a completely different

model. we've built over a long period of time. we put a ton of effort making sure we found as much efficiency as we could in every area of the business the way we reconditioned cars the way they're in great shape for our customers, spend money to deliver cars to a customer's door, makinging sure that's faster, the way that the transaction is managed we've worked hard to make every part of the transaction more efficient and think there's a lot more room to continue to find efficiency and we'll work hard to find those gains and share them with our customers and keep the party going. >> it's one of the greatest turnaround stories in corporate america. i can't think of one that has been more astonishing. this isn't like a meme stock thing where you were hertz and investors said let's take a flyer. what is your gross profit per car now? >> it's significant. we're now -- we've been the last couple quarters in the $7,000 area give or take and able to do that by cutting out more middlemen than has been the case

in automotive retail we're a stacked automotive retailer, finance company, logistics company, reconditioning company, a company that buys more are cars from customers than we sell. by stacking those functions that exist we're able to give our customers a great deal and be more profitable than any business has been in this industry it's been pretty fun and we're excited about it. >> to make sure people caught that $7,000 per car gross profit that's a big number. two years ago there were people who thought your junk bond doing more debt issuance was a zero and didn't want to go near it. the bankers who got involved were able to keep you going, but also it was just an incredible -- the ability to kind of navigate that was very difficult. i think back to when elon musk was sleeping on the floor at tesla when it nearly went bankrupt and if you had any moments like that? >> i think the truth building anything different is very hard.

most of the time most people don't get an in depth view of how difficult it can be. unfortunately at the time, but i think with the benefit of hindsight 22 and 23 was a tough time for us but inside the company a bunch of people stood up tall, we did our best work, and we're on a great path and i think that we're a better company for having gone through that we definitely have taken our bumps along the way. that's the case when trying to build something different, but today is a good day and we're excited to keep it going. >> so let me say i want to buy car from you, go on your website, and i note you have tesla model 3 the biggest seller among your cars in 2024, let's say i see a tesla model 3 i want to buy, we agree on a price and you deliver it to my house, and i decide i don't want it for whatever reason, just because it didn't have this or that, what happens then >> you call us up, you tell us you don't want it, we come get

it from you. we given you seven days to drive the car around your neighborhood and see if your golf clubs fit in the back and cup holders work for you and your kid's car seat fits in there. if it works awesome if it doesn't you give us a call and we'll bring you a new one or take it away our goal is to make that as easy as possible so the customers tell that story and others know if they want to buy a car from us if they make a mistake they can return it. it makes the decision easier up front. >> if i want to sell a car i assume it's the same operation agree on a price telling my tesla model 3 to you, you come and pick it up and give me a check >> correct we'll come pick it up as soon as same day drop it off to us as well. we'll put money in your account and call it a day. >> ernie, quick final observation really, take it however you want, the stock is trading at over 100 times, for its forward p/e. those who go great job, nice turnaround, ain't going near it, do you think your growth is

going to justify that kind of multiple >> i was nervous what you were going to say once you set me up like that. we're going to let the stock take care of itself. we are 1% of this market it's a trillion dollar market. there's a tremendous amount of opportunity. our job is to go out and take advantage of that opportunity. i think investors' jobs is to figure out what the present value of that execution is going to be and that's their job we're going to keep running fast and keep trying to solve problems and deliver great customer experiences and investors can figure out the right price. >> all right we had an answer i got to say, don't buy the stock -- >> you put me in that spot and did that to me. >> listen, if you can get through what you got through you can handle any question. ernie garcia, appreciate your time today thanks for joining us. the chairman and ceo of carvana. and still ahead, treasury yields continue to climb after yesterday's rate cut but just how high will they go if we'll discuss that topic in market navigator next.

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welcome back to "power lunch," everybody. after yesterday's debacle that really took place in the last two hours of trade the industrials are up 250 points,

s&p by 29, almost 30 and the nasdaq by 104, basically half percentage point gains dominic chu what do we have in our navigator today? >> what we have right now is the 10-year treasury yield continuing to climb well above that key 4.5% level. one of those traders believes yields will continue to rise in the short term you saw him earlier back with us again is jeff killberg, founder and ceo -- >> wearing the indiana coat. >> he has the indiana coat on right there. let's talk again about the yield picture so take us away to this world here where the yield is not going to be as scary or will it be as scary as the recent price action has lent itself too? >> it's remarkable how much has changed since yesterday's fed meeting. where the 10-year note has been before september when they had the 50 ps basis point cut we're 100 basis points higher. i think the trajectory will

continue to move higher due to the fact that they can't get inflation under control, due to the fact they're forced not to cut anymore potentially in 2025 beyond the pause so much uncertainty about tariffs, so much uncertainty about tax cuts, so much uncertainty about deficits that's going to propel potentially the etf, tlt lower this is the inverse relationship so think about it, the 10-year note from 4.5% to 5% tlt, $50 billion etf will go lower. it's an inverse relationship i want to be considerate of that move higher and use options to express a bearish view on tlt but yields going up to 5%. >> we're showing the graphic right now about the put spread it is a bearish trade. take us through the mechanics of this options strategy. >> so it's a bearish trade when you think where we're coming this is a put spread i want to be a buyer tlt is 30 cents higher i want to be a buyer and going out to january 24th, three days

after the inauguration, four days after, a buyer of the 88 put in tlt i paid about 1.40 this morning, but i also want to consider reducing some of that costs and selling the premium, so i sold the same expiration january 24th put for 35 cents and that put is at $84 i'm hoping if the yield does go up to 5% in the 10-year this put spread will fill out and collect $4 minus what i paid about 1.05. >> if this happens the max you can make minus the 1.05 you paid for it. >> correct. >> what point do you bail on this trade or it's not worth it and risk management or saying you've already purchased this thing, but how exactly then would you risk manage around it if it's not going in your favor or do you care some. >> so when i buy a put spread i'm comfortable losing the $105 per one lot because if this is wrong we're going to see my equity exposure appreciate and continue to move higher.

on a put spread i define it out of the gate and not manage or over manage it, but if we see this come to fruition, correct about this trade, dom, you will see equities move down 5 or 10%. we saw the 30-year jumbo loans over 7%. the 30-year futures go to 4.75 this could be disastrous short term because a consumer will get hit with these higher yields we haven't felt it yet there's a lag effect and we're 100 basis points higher from last september there is going to be some effect on the consumer moving forward. >> jeff killburg, navigating the bond market, thank you very much we appreciate it. >> go irish. it's my last had to get one more in. >> all right >> let's bet a steak dinner. how does that sound, ty? >> great to me. >> i am a witness to it. >> you're on. >> dom, you can come, too. >> go hoosiers. >> still ahead, shares of the s&p regional bank etf off about

6% so far this week. we will speak with valley bank ceo ira robbins about what the plans for interest rates could mean for his bank and what deregulation might mean as well. "powerun" bk t lchisacinwo [cheerful music] [phone ringing] not all multimillionaires build their wealth the same way, you have... the fearless investor. the type a cpa. the boot strapper. the boot maker. hee-ha. but many do have something in common. we all trust schwab with our wealth. thanks to our award-winning service, low costs and transparent advice, every day, over a million multi-millionaires, trust schwab with more than three trillion dollars of their wealth. ♪♪

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- [announcer] eyes forward. don't drive distracted. ♪ welcome back to "power lunch. i'm contessa brewer with your cnbc news update the suspect in the murder of unitedhealthcare ceo brian thompson is back in new york this afternoon luigi mangione is expected in court any minute after being hit with new federal charges including murder, stalking, and firearms offenses. federal prosecutors say they have jurisdiction since mangione allegedly traveled from georgia to new york to commit the crime. meanwhile a texas judge refused to throw out criminal charges today against the former uvalde school police chief accused of delaying the response to that mass shooting at robb elementary in 2022

19 children and two teachers died pete arredondo faces ten counts of child endangerment. his lawyers had argued he was improperly charged. and big lots announced it will hold going out of business sales at all of its locations after its sales of private equity firm nexus capital fell apart. it will try to find another way to stay in business and complete a sale by early january. we'll keep our eye on that situation. tyler. >> thank you very much inflation back in focus after the fed gave a hawkish forecast for its rate cut path in 2025. bond yields jumping, stocks falling while powell gave his statement. here to give us a read on thing banking and consumers, ira robbins. good to see you in house. >> wonderful to see you. >> your reaction to what the fed did yesterday and a positive yield curve and what it means for your business? >> could not be happier to have

a positive yield curve operating in a negative yield curve for a bank like valley that generates so much revenue from the interest spread has been a challenge last two to three years. even though we're sitting at 25, 30 basis points a positive yield curve today that positive slope is going to be a huge tailwind for banks not just regional banks, but for all banks in general. couldn't be happier. >> seemed as though the fed chair was concerned or -- too strong a word -- inflation, are you? >> absolutely. inflation is running higher than what fed's target is and there hasn't been any kind of -- we had an early -- a reduction of what that looked like but showing strength still inflation is going to continue as we continue to move forward in the conversations i've had with borrowers they're seeing inflationary prices an the tariffs we want to talk about. i was with a borrower the other night, and he talked about implementing 10% price increases with the expectation of what may

happen those conversations are beginning to happen and a confidence perspective, when sentiment changes -- >> what industry was he in. >> apparel. >> we were having a debate whether the apparel companies are going to be hit by this or did they absorb it last time interesting point made we had tax cuts last time before tariffs it kind of helped companies cushion the blow we're not going to get corporate tax cuts this time around, not first. we might get the tariffs first and if that dynamic will be different. >> thousand percent different. margins have been under pressure for a significant period of time we've seen increased interests the compression we saw it. the ability for a borrower not to pay as much interest may not be as much as they thought before and now they're seeing price escalation it's challenging to how they're managing bottom lines. they will try to push it through to the borrower to the end buyer than what we saw last time >> let's talk about deregulation

there has been, obviously, the new administration, a lot of talk about deregulation that would affect the banking sector. what do you think about that as a broad question and if there was or one or two regulations that you could change or eliminate what would they be >> in the banking sector and broad u.s. general has to decide how inclusive do we want the banking sector to be. >> meaning >> we've made capital restrictions, regulation, that is uninclusive as to our consumers cannot enter the banking industry and left going somewhere else, a checking account because of overdraft protection, shadow banking environment, payment rails are looking to move. we have put forth in policies in place from a capital requirements per spec ittive to think about bright lines in reg regulation that has made the banking industry to be uninclusive. >> the unbanked. >> it's increasing when you think about generational client, entrepreneurs, where they're

getting their capital from today, credit is being delivered outside the banking industry today. in general shadow banking environment is great when you look how does that align with the socioeconomic derivatives as to what this country wants. no fair lending that sits in these environments no cra requirements that sit in the shadow banking environments. so we are creating a country where access to capital is being pushed out of the banking environment to organizations that don't have any of the socioeconomic themes we've been talking about the last three to four years. >> if something goes wrong, you know -- >> would you like to be more like them or them to be more regulated like you >> i think regulation is a good thing to be clear. there has to be glation in an industry like ours we are built on trust but a regulation that doesn't say i need 2 to 300 basis points of capital. are we making banks safer or is the tradeoff harmful --

>> is moving lending to another platform >> moving lending to different platforms we should be doing banks innovate all the time. we think ability technologies and transfers from a payment system banks have innovated over and over again regulation we should be focusing on but regulation that takes hardworking consumers out of a banking industry is bad. we talk about commercial real estate today valley has a significant exposure to commercial real estate when we say bank can't lend to commercial real estate it goes to organizations that don't have affordable housing requirements associated with it where is the housing going to come from and who is it going to be for it's not going to be for the intended outcomes we're looking for and we need to rethink through the entire regulatory approach within the country and what is the outcome we're looking for because right now the unintended consequences in my mind far outweigh the good they're looking to see.

>> call up d.o.g.e. >> there's a lot of regulators out there today. >> lot in banking might be changing the banking regulator fdic into treasury, a view on that >> i think we have a lot of regulators and they do a good job of what they're doing but do the same thing at three or four different regulator. i'm not sure that's the correct approach a more uniform approach, the same regulatory environment that sat around 3040 years. everything should be lookeded at again. how do we deliver our experiences to individual clients. payment rails have changed we have to change the regulatory environment not because we don't have good regulators, sometimes they have a mission that gets crossed up an that creates inefficiencies and challenges and organizations like valley have difficulties competing in that type of environment regulatory has to be looked at. >> i hope however is in charge consults you. >> thank you for having me. >> good to see you.

>> the 10-year yield is continuing its rise after yesterday's fed decision and press conference around 4:55 at present we'll get out to chicago and check in with the traders on this topic when "power lunch" returns. it all started with a small business idea. it's a pillow with a speaker in it! that's right craig. pulling in the perfect team to get the job done. i'm just here for the internets. at&t, it's super-fast! you locked us out?! and when thrown a curveball... arrggghh! ahhhh! [crashing sounds] we had everything we needed. is the internet out? don't worry, we have at&t internet back-up. the next level network for small business. ♪♪ i sold a pillow!

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welcome back to "power lunch. stocks are rebounding although off of earlier highs we're up about a half percent on the dow, third of a percent on the s&p and nasdaq after yesterday's declines but interest rates remain in focus out to rick santelli in chicago for more on this developing story. rick >> yeah. i'll tell you the interest rate complex is wild just like equities if you look at the first chart, this chart starts on the 9th of december which means we've had nine consecutive sessions in a row on the 10-year where the yields on any given day are higher than the previous day that is building momentum. we've talked about it, and it's been a great technical indicator 2s, 10s spread the steepest and widest since mid 22 speaks volumes about the market's anxiety on inflation finally the dollar index on pace for another record close going back to the end of 2022.

but maybe the most interesting story is all that volatility in equities what it may mean and for that we're going to talk to chem >> rick. >> yesterday was one of those days where the equity markets went wild. so did interest rates. when we spoke you had a good explanation that i think viewers would be interested in. >> it's a perfect storm. not only getting the inflation in the catalyst, but it's important it's on equities. >> operations expiration go on. >> option expiration the leaps on the board for years. a ton of open interest in the put side so what happens, when all of a sudden you get a catalyst start moving people need to cover risk that was faster than people expected a lot of short coveringen these options. >> basically selling futures to neutralize some of the exposure they had on the options side >> there was a lot of put

selling dimes, 20s, that went up to $5 on that move that creates a margin all issue so people have to cover that risk that expires tomorrow morning so a lot of that relief is what you're seeing here in terms of the push up as those things are coming down until that comes off the board you have this volatility pressure. >> they see that opening price and then we're pretty much done tomorrow. >> that's right. the catalyst is still there. don't think this is over the structured flows we've been seeing are fading going away and as that starts to fade you're likely to get more selling in the next couple days. >> i used to love expiration dates. thought the opening price is the end of the game you have until when to decide if you want to position in those options take delivery, so you can play the game, see where the futures market is and then decide i want that or let them expire worthless, correct >> that's right. the a.m. print is critical tomorrow, stable through it which it looks like we will be you will get more support but

then friday and monday after the initial support now there's a whole new ball game. the hedges come off as well. >> now, how should we look at the rest of the year with respect to or beyond the big expiration any dynamics going into the end of the year under the santa claus and the turns that we should be aware of >> a releveraging effect that should still provide some support, but this interest rate inflation story is the story as we go into the election there's going to be risk off and people don't want to stick around for what might happen to accelerate some of those forces the inflationary, stagflationary forces you and i talked about are going to be at the heart of the conversations. >> excellent always fun to talk to you. be careful on the big expiration and watch the opening price tomorrow and remember if you have a bit after that to decide if you want the position of your expiring options kelly, back to you >> rick and chem, thank you so much we appreciate it still ahead we're less than 36 hours away from potential

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doors were meant to be opened. government shutdown is looming. it could happen this saturday morning. let's get to emily wilkins on capitol hill for the latest. emily? >> hey, tyler. yeah, speaker mike johnson has been huddling in his office for hours with lawmakers trying to hash out a plan to keep the government from shutting down come saturday. now remember elon musk, he killed that initial bipartisan agreement that lawmakers had, and he heavily criticized the measure's spending which, of course, is going to be a focus for the department of government efficiency or d.o.g.e. it is looking like any package to fund the government is going to have billions of additional spending in it donald trump himself called for congress to fund disaster aid for areas hit hard by hurricanes and fade to farmers. those measures alone if you look at that original bipartisan

bill, are more than $110 billion in funding now there are some smaller measures that were in that initial package likely to be cut. this includes giving a cost of living boost to lawmakers' salaries those have a smaller price tag this is really showing how hard it's going to be for elon musk and vivek ramaswamy to cut government funding in addition today, the senate is actually supposed to vote on a package to expand social security benefits to those who get a ublic pension but also worked a job that paid into social security. it's set to pass the senate and become law and add $200 billion to federal spending. and this is really just showing that even though republicans have a mandate that they see to cut spending and cut the size of government, there are still a lot of bipartisan support for spending measures and a lot of questions about i think what next year is going to look like that we're still trying to figure out through this very

what is supposed to be the final week of lawmakers being in d.c. trying to figure out the path forward on funding the government guys how much power does musk have and the people on capitol ill react to the fact that an unelective delegate who is not even really in power yet because there is no new administration, is seemingly calling the shots for congress and where is vivek >> look, elon musk put his money where his mouth was in the last election he spent hundreds of millions of dollars not only helping trump but hedge republicans keep the house. they're cognizant of the fact with his purchase of twitter now, of course, x, he has a megaphone in terms of reaching conservatives. there were lawmakers who i spoke with yesterday who said their phones in their offices were ringing off the hook with people calling them saying that they had seen musk's tweets and they had concerns that's the kind of power that

musk is bringing to capitol hill you are right. we did hear incoming senate majority leader john thune say look, members are going to have to balance what they see on social media with what they think is actually the best thing for their constituents i think a lot of questions here how this is going to work out and play out but certainly a lot of concern right now. >> for now thanks. we appreciate it very much the markets are paying attention to what happens there. so are those in management frank holland joining us more on what cfos are saying about prospects to big cuts to government spending. >> hey, kelly, the biggest corporate financial decision makers are very concerned about the economic future of america according to the results of our exclusive cnbc, cfo council survey sw to ensure the future of the current. the 7% disagreeing with that statement somewhat the survey taken between december 9th and 16th.

that was after vivek ramaswamy spoke at our cfo council summit sharing his vision for doj.o.g. with elon musk they believe they will achieve some meaningful cuts in spending there's mixed opinions of the reality of achieving that goal by july 4th, 2026. 33% disagree strongly it is possible, 33% say it is possible we asked cfos about their spending plans for next year, few data points here more than 80% said their capex would increase or stay the same and when asked about the top capex priority the number one answer was investing in tech outside of artificial intelligence. only 7% said they are investing in ai capabilities back over to you >> what do you find most surprising about these results >> you know, i really found it

surprising that a lot of these cfos believes sweeping government changes need to be made but when we asked them how could d.o.g.e. potentially impact the economy we have graphics i want to show you a wide range of results some people believing that d.o.g.e. has the potential to actually harm the u.s. economy, others saying oounl just not sure what it could mean. but everybody believes there needs to be some type of change and you can see from our previous numbers a lot of them believe they're going to be effective in the cuts but the impact of the cuts on the economy doesn't seem to be clear when we talk to these financial decision make years. >> interesting, too, that the capital spending intentions are not on ai so much as they are on other kinds of technology. >> right. >> frank holland, thanks very much. on monday a very special edition of "power lunch" we're stuffing your stockings with stocks all hour long traders, strategists and analysts give you their top picks going into 2025 and which names you want to hear about find us on social media and put in your requests

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ca let's get a look at the markets before we go everybody is backed off from the highs. >> fading a little >> market was up the ten-year-year-old rose to nearly 4.6% is backed up there was a bad tips auction really, really bad we talked about the yields earlier how they were on the up. that's why you see them where they are. >> it was interesting yesterday. at 2:00 we were on the market was positive as i recall

then it began to fade. by the time i got home -- 1,000 points what happened? >> we are down 200 we gave them a market. >> we tried. it all fell apart. maybe even on some of the drama. >> i think so. thanks for watching "power lunch. don't blame that on me no way i don't own that welcome to "closing bell." we begin with the fate of the rally and whether enough has changed over the past 24 hours to change the trajectory of the market we will ask our experts, including that man, rick rieder who joins me momentarily the scorecard with 60 minutes to go we are trying to worse off the wors