>> all right, welcome to power lunch alongside kelly i'm brian. right now we. >> are. >> seeing stocks down just a little bit. in fact well mixed. the s&p is up with the dow and the nasdaq are lower kelly it's because we have something happening right now. >> the fed minutes steve liesman is there. steve what can you tell us. >> minutes from the december for the january meeting are replete with mentions of concern both to the upside and the downside for the economy, from potential policies from the trump administration. the committee says that it's well positioned to take time to assess the evolving outlook. the fed wants to see further inflation progress before making additional adjustments to the funds target. as long as the

economy remains near maximum employment. quote, there's a high degree of uncertainty made it appropriate for the committee to take a careful approach. trade and immigration policies were cited as having the potential to hinder the disinflation process, as business contacts were telling the fed, they, quote, would attempt to pass on to consumers higher input costs arising from potential tariffs. they were also reporting an increase in uncertainty, generally from changes coming to government federal government policies. however, there were also expressing optimism in the economic outlook for the potential easing of government regulations and tax policy. so both upside and downside potential effects seen by the fed from their business contacts about changes in policy. some were concerned it may be difficult to distinguish is a line we've heard before to distinguish between persistent and temporary policy changes from new government policies, as in changes to the inflation rate. more favorable regulatory environment was seen as an

upside risk for growth. now here's the key here. many still wanted additional evidence of continued disinflation to support the view that inflation was headed towards the 2% target. inflation was still expected to head there, but progress was seen as potentially uneven. they cited easing nominal wage growth, anchored inflation expectations but and also reduced business business spending or pricing power. the committee saw notable progress towards price stability, but inflation was somewhat elevated, a few noting the fed funds rate quote may not be far above its neutral level. guys, i'll leave it there for now, but there's a lot to digest here. but i think reading these minutes, you really get the flavor that the fed is watching. what's happening, say, just down the street from here at the white house and in congress for how those policies are going to affect the us economy. >> all right. you said a lot to digest. so let's just stay on the food theme, shall we, steve? because you got the entrees. you got a couple of sides, maybe an appetizer and a dessert. if you

were to frame these minutes. and really the fed's thinking now in those terms what would be the entree. what would be the main thing that we should be talking about with the federal reserve right now. and now i'm hungry. but the show is called power lunch. >> you know, brian, it's interesting and i'm thinking about this on the fly now, you always ask these interesting questions here. i feel like i just walked into a restaurant that somebody recommended to me. might be good, but i'm still waiting for the food to be served. and so i am reserving judgment about the restaurant, about whether or not i'm going to eat a lot, eat a little. am i going to pay a lot or pay a little? i don't think the fed knows what kind of entree is going to be served from this administration, and it doesn't know the later, shall we say, gastronomic effects on the economy. just to take it a little bit further, am i going to be taking a tums later on or am i going to sleep? well. >> i like that. i like the idea that. >> we you set me up for it, my

friend. >> we might have a. little inflation indigestion, as they would say. all right, let's let's add to the conversation. >> let me, let me let me just add let me just add to it because, because we might get a serving of tax cuts and deregulation. we might get a serving of just tariffs. we might get servings of all of it. it could be like one of those thanksgiving dinners. or it could be, you know, i don't know, maybe just a bite on the road. >> i feel like we should bring in our current guests and like gordon ramsay into the conversation. now to talk. we got tom porcelli. he is chief u.s. economist named after a mushroom. also, we can go on with this forever. and david spika, he is chief market strategist at turtle creek wealth advisors. tom, of course with pjm we got steve as well. so you got the food theme going here, tom. because we did i never planned anything. i and kelly's like he's insane. but she gets it at home too. >> i mean. >> it was really priceless. >> that's why i know i can do it with steve and you, by the way. so how would you frame that?

because i think the fed, on a more serious note, is a little more is a little bit confusing. right. that's why i brought that up. we actually don't with tariffs with taxes. we don't know what's going to happen. >> yeah. >> and i think well just like you're confused i think the market is a. >> little confused. and so. >> the fed. >> should be a little confused too. right. i mean the sort of on again off again idea as it relates to terrorism, i think is really sort of pushing the fed to the sidelines. so i think, you know, i think it's prudent for them to step to the sidelines, sort of wait and see where we go. from an inflation perspective. i think the minutes, as steve pointed out, i think they're right to sort of highlight, hey, maybe there's this sort of, you know, we really want to see inflation sort of drift lower. but i would just caution, though, while i have a lot of sympathy for that view, i think we cannot forget that tariffs are attacks. and if all of a sudden you do see these tariffs come on i get it. the knee jerk reaction will be hey let's worry about inflation. but i think you actually have to really worry about growth too. and so i don't think the reaction function from this fed is necessarily going to be hey let's raise rates. if you do get

sort of, you know, say aggressive tariffs, i think actually what the reaction function would be is hey, rates are still meaningfully restrictive. as powell has said. let's let that sort of do some of the work. and then let's just sit back and wait and see if you actually do get the growth hit. so the growth part of it, i think is being is being underpriced. do you. >> think. people are waiting to see i don't know how big of an impact it could have the federal government layoffs, like if you start getting a jobs report with the headline isn't so great. maybe it's that reason. i don't know if you get that combination of things slow consumer spending hit. >> yeah. look, i think at the end of the day you sort of we know that that's waiting for us now. so i think you can sort of, you know, you'll make that adjustment. i think actually the thing we have to wonder about is, you know, how many of those folks will actually want to get another job in the interim period? so i don't know that it's something that the fed would necessarily have to react to from a, you know, because it's a negative shock, because i think that it's sort of unclear to me that these folks will actually want to be sort of unemployed for some lengthy period of time. >> so go back to that. but, david, in the meantime, what do

you think the markets should do with this? >> i don't think the market is. >> going to do much with this. kelly. this is really just a confirmation. >> of what we've. >> already known. there were a couple of phrases in those minutes that really stood out to me. >> there is a high. >> degree of uncertainty that necessitates a careful approach, which. >> is. >> exactly where we've been with this. >> and the. >> second thing is a lot of the fed committee members don't think we're far from the neutral rate. >> so if. >> we're, say, 25 or 50 basis points from the neutral rate. >> which we. believe we are. >> there's no need to hurry. the fed is going. >> to take their time. >> they're going to watch in coming data, you're going to see the impact of tariffs and other things before they do anything. and there's no rush to cut rates materially at this point. >> does that make you less positive on the market or does that change the kind of stocks you invest in? >> no, not at all. kelly. we've been of the belief that rates are going to stay higher for longer, and the fed was not going to do much this year. so we've really been focusing on companies with visible earnings growth. and if you look at what happened in 23 and 24, the markets rallied on very little earnings growth because inflation was falling. however, we're not going to see that kind of decline in inflation this year. nor are we going to see the fed stimulus. so we've got

to focus on earnings. earnings growth is the key. the expectation now is about 10% for the year. i don't know if we get that. but at the end of the day earnings growth and earnings visibility is critical. and that's what we need to be. >> so steve liesman if we are waiting for some clarity, we're waiting for clarity on tariffs, waiting for clarity on taxes. we could have a government shutdown in march if all this kind of continues this way. the federal reserve that i've got to imagine the next few meetings has is also, even if they don't want to wait, i feel like what you're saying is they're going to have to i. >> i think that's right, brian. and i want to take it a step further and get tom's take on this, and maybe even kelly as well. i think waiting is now official policy. it was kind of like an idea that was floated before. but reading these minutes and david pointed out the caution, the uncertainty. and, brian, you like to drive cars. there's forward, there's drive and there's reverse.

there's also neutral. neutral is a gear here. and that's the gear the federal reserve is. and it's time to start thinking about what it would take to get the fed out of neutral. and that is really where we're at now. it's figuring out the reaction function of getting the fed to go either in reverse or drive or some other gear here. but neutral is now official policy. >> tom. >> you agree? yeah i do. i think steve is spot on. and here, here's the problem. i think again, that i think is being underappreciated. the we're all waiting for this. you know, we're going to go into drive and reverse to use steve's. >> from a food to a driving. there's a lot going on here, man. >> you guys really have. >> my the doordash of shows. i don't know where we're headed. >> i think here's the problem. i think you're just creating or keeping in place this really this big cloud of uncertainty. and if you think back on trump 1.0 and what what happened from a capex perspective on the back of the first round of tariffs, you really started to see capex really start to soften up. and by the way, they had in place

this benefit, right? this, this, this immediate depreciation benefit from from the first tax cuts. and yet they still slowed capital expenditures down. if you think about the small business sector, right. everyone's talking about all of the sort of animal spirits in that space. just keep in mind what happened after the trump 1.0 tariffs. you started to see that really sort of fade. and so did job growth in that in that space. so i think the longer you keep this uncertainty in place, i think the more effect you will have on the growth side of the inflation, even more so than than maybe the inflation side, which again, i think is. >> but but david, here's the weird thing. i think this kind of goes to kelly's point at the top, which is that the market we're we've been told, hates uncertainty. i mean, how many times you hear that? but the s&p 500 is higher this year. so even in a time of great uncertainty the market's not soaring. i want to make that very clear. but we're not falling either. >> yeah. don't forget brian. there's still a little liquidity out there. there's a lot of cash on the sidelines. people looking for good entry points. you're going to see money buying the dips. and the other thing that i want to stress again is we've

got to get past this belief that only monetary policy drives stock prices. we got to get back to the fundamental drivers of the economy and of stock prices, and that's earnings growth. and once we can adjust to that normalized rate environment and focus on earnings growth, i think the market will do fine. now that doesn't mean we don't have some volatility between here and then. but at the end of the day that's what we need. we need a healthy normal environment with normalized rates and with earnings, not monetary policy driving stock prices. >> by the way, quick little mention here. the officials did discuss slowing or ending in the light of the debt ceiling issue. so we're not seeing a huge reaction rates or anything like that, but just another little storyline to keep an eye on. gentlemen. thanks. appreciate it. today, steve liesman, tom porcelli and david spika. intel shares are lower today after its best session in nearly five years yesterday. that came amid reports it could be broken up into. but we'll speak with an analyst who says that's a very bad idea for the company and shareholders. power lunch will be right back.

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>> sign and make official. >> start your will at trust fund. >> now and make it count. >> welcome back. and take a look at intel, which is giving up 6% today and is actually one of the worst performers on the s&p after its 16% gain yesterday on reports they could sell parts of the business kind of break itself up and that would go to broadcom and taiwan semi. the shares are up 28% for the year. but our next guest insists a us based foundry business simply wouldn't work. even with billions of dollars of grants from the government. >> the number. >> one foundry. >> out there is tsmc, and they

literally. gain share every year, in. >> our opinion. >> and we've written about this. what the us government should do is just give it all to tsmc, have them build fabs in the us. otherwise you're just you're just spinning your wheels. you're just wasting money. >> haha. prophetic remarks christopher danley is back with us on what he thinks of this rumored takeover deal. he's a semi analyst at citi. i mean, that sort of sounds like what they're doing, chris, is being like here taiwan semi you deal with this and broadcom you can have the better piece. >> yeah. well first of. >> all i'm super embarrassed to be. wearing the same shirt this time. >> that i. >> wore in. >> the. >> last update my wardrobe. but yeah i mean we. >> we've been saying. >> this for a while. if you want. >> to chop. >> intel in. >> half. >> the analogy i. >> would use is. >> like building a. >> house, right? >> when you're building a. >> semiconductor. >> it takes a few months. >> there's a lot of. different steps. you want the design people to talk to the. >> manufacturing people building. >> a house. you want your architect, ideally to talk to your contractor. and it's the same thing with making a

semiconductor. so if they want to spin off non-core businesses like altera or mobileye or whatever, that's fine. no big deal. but as far as splitting, the core businesses are not going to work. and again, we continue to believe that tsmc is the best foundry out there. they're building factories in phoenix and arizona in the us. just give them the money and call it a day. >> many of our viewers and listeners, chris got rich for years. buying intel stock was one of the legendary american companies. andy grove and his whole team for decades. just intel inside. we all knew the jingle. a lot of people still think that way. oh, the stock is down by, you know, two thirds. but that makes it a good value. is intel a good value? >> so i like where you're going. i still think intel is one of the great manufacturing companies out there that's manufacturing processors, not chips for other folks. this foundry unit for intel is literally losing billions every

quarter. if they got rid of the foundry, the merchant foundry business, and focused on manufacturing, i think you're back to the intel of old. you've got a path to 3 or $4 in earnings, 50 or $60 stock. it's not complicated. it's just this foundry effort is sinking them. so i totally agree with you. i think there is value there. but you need someone to be able to extract the value. we actually think that pat gelsinger was pretty close to extracting that value. and you know, by the end of this year, it looks like intel can get at least close to the competition now that he's gone. now that they've had some some defections and there's no, you know, ceo there yet that that's in danger. >> that's interesting because a lot of people thought, well, you know, he's had his chance. and now you're saying, listen, you know without him there, what's the path forward? i mean, can the market resolve this? chris, does the us government need to be involved, ought to be involved? >> that's a great question. so, you know, i'm a taxpayer. we're all taxpayers. i want my taxes

to get used efficiently. i agree that, you know, having a leading edge foundry, leading edge manufacturing in the us is a good idea. i also think that i want my money used efficiently. intel has proven for 20 years they cannot do leading edge foundry. they've also proven for 50 years they can do leading edge processors, let them do leading edge processors. tsmc, you do the leading edge foundry. i really don't think it's any more complicated than that. >> well, and what would in the meantime if you, you know, for the for the other stakeholders who hear this and might think, well, maybe there's, there's other suitors or other ideas, i guess they'll have their chance. chris, for now, we'll leave it there. appreciate you joining us today. >> any time. >> christianity. >> all right. coming up, why you are probably not alone if your home heating bill skyrocketed. plus, this mystery stock is soaring today on news. it could save you a trip to the doctor's

office. i just wanted to pause for really dramatic effect. we're back right after. >> this. >> why? it's stone. >> wasn't played. stone having supply chain issues. i wonder. >> how that affected the full year guidance. what's the endless forecast? am i shaving? >> what's up bro?

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and not to make irrational decisions. the return on investment for the club pays for itself. >> join the club. new members save with a special offer for a limited time at cnbc.com. terms and restrictions apply. >> we're in the chairs we got here. >> that means. >> it's amazing. so let's talk about some of the news and stories that you may be talking about. or at least you should be. all right. first up, another storm may hit parts of the east coast over the next couple of days, adding to what has been just a rough winter across much of america. it's been super cold everywhere, and it may get worse. the national weather service issuing extreme cold warnings for more than 32 million people in 11 states, could be 45 degrees lower than normal. >> it's crazy. >> just 45, not 4.5. >> going crazy. i'm losing my mind. >> she's losing her mind. and we don't want that. and it's going to be. it's going to snow like a half a foot in norfolk,

virginia. >> wow. >> saw that. so crazy. along with this cold weather. weather is going down kelly. bills are going up. a lot of you we know getting stuck with higher utility bills. it's price of natural gas. it's the cost of delivery. >> it's both because it's not just people say what? what is the reason for this? well, it's a lot colder this year. you've had to really jack. we looked at our own bill after after we were talking about this this morning. >> mine doubled. >> did it double ours. >> well, it was like a makeup for the equal payment plan. but the sullivan family bill this month doubled from last year. yeah. because it's seven degrees colder or six degrees colder than it was last year. and we were just using more heat. so now the sullivan family is going to be in sweaters, right? >> it's nothing to fear. maybe it's just but it's another drip drip drip drip drip. we're now okay and it's extra cold now the heating is up. another squeeze on people. >> boston everywhere where they just they it's expensive. >> extremely. meanwhile, people down in warm texas will normally warm. and around the country are talking about this one. there

are accusations that the texas lottery was rigged for a major drawing. this is back in 2023. the former head of the lottery commission is now being accused, though he denies wrongdoing. an investigation found that a. ready? are you ready for this? i'm ready. a european based syndicate. what? every single number combination possible to win the $95 million prize for just about $26 million. about 26 million tickets, each with a distinct number. how do you do that? >> how do you do? >> that's where the accusations come in. a lawsuit alleging a series of rule changes over the years made it possible. >> wouldn't that take years to just get a ticket with every number combination? >> it feels like something a lot of hedge fund guys would try to do. but it was europe. it's european, someone or other. >> if you can do that, you do the powerball. they were probably maybe testing it for a $2 billion prize. >> i don't know if the similar rule changes would apply and make something like that possible, but in this case they reaped quite a windfall. speaking of windfall, shares of hims and hers are jumping to 20% today to an all time high. they've had a series of recent

moves, brian. i mean, look at this move 190% year to date. now they're rolling out home lab testing. they say this is blood essentially, right. they're saying these tests will help identify risks earlier. and the company will use the data to accelerate the development of ai powered healthcare. >> okay. so basically draw your own blood at home, send it to us. we're going to use all your dna, collect it anonymously to make us ourselves richer. so it sounds a lot like a. >> well, listen, whatever it sounds like, the question is how much uptake might there be? people are really eager to avoid those trips to the doctor's office. you and i know it's impossible to schedule. it's expensive. >> to quest diagnostics for 35 bucks to get a bunch. >> of. >> work done. >> those places are not easy to deal with. you walk in, it's some random building. >> you know. >> i can tell you what to do. you're standing there and you're like, am i like it's a horrible experience. >> okay, so you're going to go for the home health prick. >> i don't know if i would. >> i can't get out of this chair. all right. quickly. the federal the federal government,

the national, i guess the federal highway safety, transportation whacked new york city's congestion pricing. if you're not familiar with this, new york city instituted a new thing. nine bucks under 60 60th street. you get an extra tax coming from new york to new york, which you never had. you may not care. you may live in iowa or chicago, la and be like, we don't care what happens in new york, i get it. except if this worked, it probably would have come to your town, which is why you care. about an hour ago, the federal government said, no, no, no, you got to kill the plan, which is also going to kill new york city's transit budget, because this money is a huge part of that. >> just anecdotally, if you're wondering what impact it's had only went into effect, what the turn of the year. so it's been maybe six weeks from our friends in the makeup. this is affecting traffic in new jersey as well. like all the backup going in at rush hour, a friend of ours used to take her an hour and 40 minutes to get to work now takes her 50. that's how big. >> it's a win, though. >> for her. that's what congestion pricing has done. it has had a actually a huge impact

in some areas. you can get into the city from hackensack, you get to midtown 30 minutes. that was another one. we were yeah. >> well the federal government said no thanks. so now there's going to be another, i don't know, new york city now, sue, over the federal government not allowing this. the new york city needed the money. new jersey hated it. so the whole thing is now what are they? it's all it's all snafu fubar. >> yes it is. >> like this chair still ahead, the doge bros. they keep whacking away at what they claim is government waste. but here's kind of a novel thought. what if there's actually a way to cut hundreds of billions without laying anybody off? we'll talk laying anybody off? we'll talk about it coming up. gold bond believes touch says everything. it says... i see you. i feel you. and...i know you. gold bond. get in touch with irresistibly touchable skin.

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okay, so that's how you want to play. ♪♪ market playbook how she sees washington policy impacting the market, plus her biggest takeaways from earnings season. john fort morgan you think those phone guys will ever figure out

how to keep 5g home internet from slowing down during peak hours? their customers have to share a wireless signal with everyone in their area. oooh. you know, it's kinda like when you bring a really big cake for your birthday, and then there's only a little, tiny sliver left for the birthday girl. aw. well, wish her a happy birthday. happy birthday... -it's... ...to her. -no, it's me. have your cake and eat it, too. don't settle for t-mobile or verizon 5g home internet. get super fast xfinity internet you don't have to share. forty's going to be my year. news update. israel says negotiations on the second phase of its ceasefire with hamas will begin this week. israeli officials say the two sides will discuss releasing the remaining hamas hostages and palestinian detainees in israeli jails. the talks were set to begin earlier this month, but had been delayed over concerns of the agreement falling apart. the vatican says the pope has made slight improvement as he receives

treatment for double pneumonia. the 88 year old has been hospitalized since last friday for breathing difficulties. italy's prime minister visited with him today and said he was alert and responsive and made jokes with her. all of his public engagements are canceled through sunday, and dozens of democratic senators are urging secretary of state marco rubio to work with congress to renew a nuclear weapons pact with russia. the current agreement expires in february of next year. the lawmakers wrote the letter to the trump administration this week as the us held high level talks with russia in saudi arabia. brian, back over to you. >> all right. thank you very much. all right. so, folks, you may hate what the so-called doge bros are doing and how they're kind of poking around government spending. and, by the way, scaring the heck out of many with government workers or their families. and you can argue this is not the right way to go about cutting some government waste or fraud or abuse. but there is no doubt that waste and fraud is a huge problem in the government. we know that because the government itself admits it. as

i posted to social media recently, a 2024 report from the government accountability office indicates that the feds lose about 230 to $520 billion per year just to fraud in the years 2018 to 2022. yep, some of that includes covid related spending and fraud around things like ppe loans. but a lot of that also was before covid, which means the government itself admits it is losing maybe a trillion of your tax dollars every couple of years, and it doesn't know on what. so whatever side of the political aisle you may be on, it shouldn't be political to want the government to not send your money and its your money to fraudsters and crooks. let's bring in mike mcginnis, president of the committee for a responsible budget. i posted this story. i'm not taking anybody's side. i don't know what's actually going on in d.c. you hear the stuff? i was there,

whatever that said, maya, it's like we have to be intellectually honest enough to admit that the federal government is simply not a good steward of our tax dollars. >> well, sort of like you said, the low hanging. >> fruit of where you. >> can find. >> savings is. >> getting rid, getting rid of all of the fraud that you can. and this is a huge. >> amount. >> hundreds of billions of dollars a year, a year. not entirely surprising when you're talking about a federal budget that is $7 trillion and there is very bad coordination, there is very bad oversight, there is very bad auditing and communication between the variety of programs. so we see that there's huge inefficiencies and huge fraud, particularly as you pointed out during covid, there are a number of programs where fraud was very, very high at that period. but yes, this is the no brainer, right? we in dc can fight about anything, but this is the no brainer that we want to squeeze all the savings out of this area first in the budget. not going to fix the fiscal situation, but it's

certainly the right place to start. >> yeah, and i don't see why now. maybe it's just because the way they're going about it, we talked to the secretary of energy. they said, listen, some of these people, they've been they've been cleared. we know who they are. what people are going to believe or they're going to believe. but we should we should all agree, maya, that sending, i don't know, 50 billion to russian gangsters or whatever, because they've infiltrated some system or created some fake unemployment, whatever it might be, all the examples that exist in real life, that 50 billion is better served going to veterans, going to teachers, going to food safety. why is this become so political? >> going to reduce the debt? because i have to point out that right now, one of the biggest demands on all of any savings we could find would be bringing our huge deficits and debt down first. we know dc is amazingly polarized. the country is polarized. we can fight about anything. i think it's obvious that the doge like effort, the effort of finding all the savings that you can and

improving the efficiency of the federal government is an incredibly useful task. however, i think there's disagreements about how things are going right now and that you really want to target where your savings are. you want to take the time to evaluate and assess before you go in and kind of do across the board cuts. and so you want to find the specific areas of waste and you want to get rid of them. there are a couple of problems. most of these these issues are in millions. and in order to get our fiscal house in order, we need to save trillions. so you're going to have to squeeze out every little bit of it. and again, we have these outdated programs where our communications between federal and state governments, different agencies, different programs is terrible. and one of, i think the best ways that we can improve this right now is a technological overhaul, which in fact, the doge folks are particularly suited to be figuring out. but if you just go back to the pandemic, we had a situation where unemployment benefits, we couldn't even communicate between federal and state governments, so we overpaid people. many people are making more during the pandemic than they did normally, because

we couldn't figure it out because our computers were so outdated. those again, i agree, those are no brainers. the things that we should be improving and waste is never the best use of our dollars for sure. >> and like you said, hopefully this kind of committee, their their knowledge, that would be a great thing to tackle. i mean, it's frustrating to see so much go to waste and fraud because the other areas like medicaid are hugely controversial. controversial. that's where we've seen a really big increase in spending over the last couple of years. but the president i want to play this clip last night just ruled out essentially making any cuts there. take a listen. >> social security won't be touched. other than this fraud or something we're going to find it's going to be strengthened, but it won't be touched. medicare, medicaid, none of that stuff is going to be touched. nothing. i don't have to. >> social security, medicare, medicaid, he said. none of that stuff is going to be touched. >> right? >> so then this is where i get concerned. so i'm all in on the idea that we need doge like efforts to really increase efficiencies. but where i become concerned is if it starts to take away the reality that we

are actually going to have to make major programmatic changes first, our fiscal situation is really bad. every warning light that could be blinking is our debt, our deficits, our interest payments, our trust funds, and social security and medicare that are becoming insolvent. second, no matter how much waste, fraud and abuse we find, you cannot fix the problem without looking at these biggest programs. and if you take social security, medicare and medicaid off of the table, you're you have taken more than half of the budget off the table. if you add interest payments, it becomes even more difficult. and if you don't touch social security and medicare, both of those programs have trust funds that are headed towards insolvency. we will see across the board, provider and benefit cuts, which leave seniors incredibly vulnerable. so that's the wrong message completely. i think we need a much different approach, which is leveling with the country, that we can't borrow $2 trillion a year. we need to look at all parts of the budget and we should do it as efficiently as possible. but we're going to have to make some programmatic changes. social security and medicare and medicaid have to be

on the table. >> i mean, let's be honest, both parties are guilty. this they're not both parties are so guilty. republicans are like, what are you talking about? we don't know anything about. and, you know, they say stuff. the reality is six of the ten richest counties in america are around washington, d.c. kelly and i are both from rural virginia. i went to high school there an hour and a half west of d.c. used to be apple trees. now it's mcmansions because d.c. highways five, lane six. you've been to front royal? >> yeah. oh, yeah. >> right. a lot of people don't even like. >> front royal. yeah. >> that's. yeah. so it's all everything's moving out that way because all the money is moved. i don't think it's a wrong thing whether it's the right way to go about it. i know it probably not, but i don't know. but my we should be asking these hard questions. and there is a lot of fraud that takes place in the federal government. >> absolutely. and there's also. >> from the federal government, they admit that it's not my opinion. that's the federal government admitting it. >> and there's industries that are built on taking advantage of $7 trillion and how that's going to work. if we really want to look at efficiencies, we need to figure out how to improve the

way our health care system works. we need to improve how we do national security, defense, procurement, all important priorities. but we can do this better. and so there are so many ways to wring out the savings. but i just want to go back to my basic truths, which are we're not going to fix the overall budget unless you look at all these programs to look at waste first. but we can't delay on these other programs because every year we wait, it becomes more difficult to fix those trust funds which are going to be insolvent in roughly a decade. we should be looking at everything. we should have those approaches on all parts of the budget, but we should do it in a targeted, careful way and take the time to evaluate it. so we're getting these solutions right, like it's i don't think this is a go fast break. >> we got to go. >> but under promise over deliver. >> it's amazing because the government just hires consultants to consultants. they have consultants who consult with the consultants hundreds of billions a year and nobody says anything. it's a very bizarre in my mcguinness. we got to leave it there. we'll bring you back on. i have a feeling, kelly, this discussion, this debate, it's not going away.

>> just want them to fix the bad stuff so we don't have to cut the good stuff. >> and front royal got to mention. >> 66 to 81. i meant the devastating wildfires in california and other natural disasters likely to further drive up insurance costs across the country. not the only industry, either. that's likely to take a financial hit. more after a break. >> crypto watch is sponsored by >> crypto watch is sponsored by crypto.com. [engine rev] [timer running] ♪♪ formula one has never been more competitive. [engine rev] if you're standing still, you're actually going backwards. we're in the business of competition... [engine rev] we're trying to beat our competitors on the track. but to do that, you need to be able to beat them... off the track.

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get good at money. so you can be a little bad. empower. the cost of the membership is. >> join the club. new members save with a special offer for a limited time at cnbc.com. terms and restrictions apply. >> welcome back and take a quick look at this intraday markets chart after the minutes. not right after. we're about 45 minutes past. the dow briefly turned positive. we have been down about 240 points at the low of the day just after 1:00 pm. then we went into the green. we're down seven right now. could be because there was some additional context around the fed's plans for further rate cuts or not, but honestly, there wasn't too much to read into it. we'll just keep an eye on this. >> the indian kuti though the winding down i think that might have been you know you brought that up. >> they said if the debt ceiling becomes more of an issue, that could be a measure they take.

and i always look to the bond market for a tell here. and we saw a little bit of a move in yields but not a major one. but the move in the dow is more significant. >> well here's a shift that is certainly too soon to calculate the total cost of those devastating california wildfires. one thing is pretty clear, though. the cost of insurance will go up, and that may impact the cost of housing in many parts of america, not just l.a. diana olick explains the continuing series of the rising risks to the economy from climate change. >> the losses from the california wildfires may seem unimaginable now, but they were already part of a calculation that climate risk experts have been modeling recently as they attempt to measure the effects of climate change on home values. so you're saying that at least 20% of us homes are going to be devalued in some way because of climate change? >> and that's correct. >> dave burt was one of the few to predict the risks in the subprime mortgage market over a

decade ago, and he made a lot of money betting against those risky loans. he sees a similar pattern emerging now with climate change as growing climate risk forces the insurance industry to reprice. higher home values will drop because when the cost of owning a home rises, its value falls. >> in the past, insurers have not increased prices. because of these increasing weather events. that's all falling apart now. >> the correction, he says, will be severe. >> we think that those 20% of markets could be down 30% over the next five years. >> in value. >> in value, which is very similar to the 2007 to 2012 great recession experience. >> and he's not alone. this at treasury secretary confirmation hearing. >> i think that the most immediate danger of a major. economic collapse is going to

come through the insurance industry, where you can't get mortgages, you can't sell properties of value. >> bert's prediction covers certain areas over the next five years, but others say the risk is much broader. by 2055, 84% of all u.s. homes may see some drop in value, totaling $1.47 trillion in losses, according to a new analysis by first street, a climate risk firm. >> growing climate related disaster risk has accelerated much more rapidly. >> ben keys is a professor of real estate and finance at the wharton school. >> that's going to accelerate the. >> process of a. >> revaluation, where there's a disconnect between buyers and sellers and ultimately assets are going to have to find a new equilibrium in order to clear the market. >> and foreclosures add to that. after hurricane sandy in 2012, foreclosures rose by 46%. and after the 2008 floods in ames, iowa, they jumped 144%. the mortgage market is not unaware

of these rising risks. fannie mae declined an interview request for this story, but we spoke with their chief climate officer two years ago on the same subject as the mortgage giant was beginning to study climate risk in underwriting. >> the amount. >> of climate change is not necessarily always priced into the market, and consumers aren't really aware of what that's going to do to insurance premiums going forward. >> the decisions that fannie and freddie make are guiding the mortgage market away from pricing climate risks directly. >> and in the meantime, dave bert is betting again. >> that can be either avoiding the most at risk securities. it can also be hedging with mortgage credit derivatives. >> rising insurance costs will be the main factor in home price declines, but not the only one. some communities might increase taxes to pay for resilience measures. maintenance and energy costs may also go up. despite all of this, last friday, the trump administration ordered

fema staff to stop immediately implementation of the federal flood risk management standard. now, this is the standard that ensures that public buildings, including schools, as well as bridges, roads, utilities and other infrastructure that are damaged in a flood will be rebuilt in a way that would make them less vulnerable to future flooding. that's all gone away. back to you guys. >> important conversation and an important piece. diana. thanks. thank you. >> and meanwhile, check out shares of solaredge, which are surging more than 30% just today. it's on pace for its best day ever. back to the ipo a decade ago. what does our trader think of this pattern? we'll ask next in three stock lunch. >> nothing stands still. not technology, not the market, and not franklin templeton. we've been a firm in motion for over 75 years, always innovating. today, we're a leader in public

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with this season's hottest accessory. -[ cellphone vibrates ] -oh, what's this? she's opening her fidelity app... to buy that stock... for exactly the amount she wants... no fees or commissions... what will gina do next? gina has roller derby at 6:00 pm. i'm there. get started investing for as little as $1. talk about easier investing. >> welcome back. it's time for three stock lunch. and we're going to look at three earnings movers and give you some insight on how to trade the names around those moves here with our trades is j. woods. he's chief global strategist at freedom capital markets. j good to see you again. and let's start with walmart. ahead of the company's fourth quarter results which are i believe thursday expected out tomorrow morning. always a biggie. the stock is still up 20% over the past couple of months. fractionally higher today. what's your take on the shares. >> yeah up 82%.

>> over the last 52 weeks 15% year to date. >> the stock. >> is a juggernaut. it's the bellwether for all retail stocks. it's a. >> stock like an apple. >> as jim cramer says you want to just hold it for the long term not trade it. but we're here to talk about trading. >> the stock. is slightly overbought. >> that doesn't. >> mean the. >> trend is going to change. it's been overbought several times during this run. >> but let's. >> look for it on any weakness where we want to enter the stock. because over the long term it's still a great name to buy. so any dip you want to look to the 9596 level. that 50 day moving average has been that nice line in the sand. it's risen that for well over 12 months now. so if it does come in a little weak, even though they've gone up four times in a row. >> eight of the last. >> ten i think would be good opportunity to buy. personally, i trimmed it on this run to have cash on the sidelines. we could see a mean reversion into some of these beaten down retailers like dollar tree, dollar general, if there's weakness here, but long term, buy it, put it away. don't look at it. but if it does dip it could be a buying opportunity yet again. >> if it does. >> jay we do want anything with

the solar edge $300 stock two years ago $20 stock right now, the shorts super heavily shorted, getting their faces ripped off today as the stock was up 60% at one point. now it's only up 18%. but is there anything core that's changed that actually makes you want to own this this stock? >> hey, they've done some great cost cutting measures. free cash flow positive this quarter. some things are, you know, looking good. but where did it open today? it opened around 23 or peaked around 23. and now it's starting to fade. i think short term if you own this stock i would sell this stock. i would fade the rally. you may have a little more leg to this one, maybe back to 24. when you look at analyst coverage, two buys, 26 holds and six sells. average price target 1380. over the next couple of days, we should see that target increase. that could lead to more of a little bit of a rally. but over the long term, what is the tailwind? how are the clouds going to recede over this stock? it's not going to be

from this administration. they still have a long way to go to get back to those levels. so it's been a great year up 57% year to date. but if you own it i would fade it. and if it rallies a little bit more i would probably sell it until proven otherwise. i would wait another quarter before getting into this name saying all is clear. >> fading solaredge let's move to bumble then, where those shares are dropping more than 25% today after they provided weaker than expected guidance for the upcoming quarter. feels like. i can't imagine a lot of technicians looking at this and saying, yeah, it's time to pick it up. >> well, yeah, i would definitely swipe left and avoid this stock over the long term, but i'm looking where there could be potential opportunity. right now the stock is down roughly 2,627%. i haven't looked in a second. but what did it do. it did this back in august. it had a weak quarter that the fearful thing is subscriber growth has gone down. user growth is going down. but we have technical levels that give us an actual advantage from a risk reward setup. watch 550 and below. the low is intraday 480. back in august it held it

rallied into the next quarter. there's big news. not a lot of people are talking about their ceo is coming back whitney wolfe herd is returning ceo and founder. she comes back in march. she's not coming back to just let things lie like they are. so i think you have a positive catalyst there, a risk reward set up that is potentially good. yes, it stung investors for a long time, but this could be the time that you may want to swipe right and see this stock rally back to 750. so risk reward. if this gets down to 550 or lower, i think it's worth taking a shot. >> he said swipe left, swipe right and stung. i think you got all that like you tweeted. you got all the puns in there, jay. don't worry, you got them all. i don't think anybody's dating. maybe nobody's dating. >> i don't think they're using bumble or tinder or whatever. anyway. >> it's all there. >> but it's there and it could provide to be a good snapback rally over the next quarter. once the ceo change. >> comes, there's no doubt bumble has been a hive of activity. today. we're back right after this. >> hi. >> opportunities can be hard to find. like catching lightning in

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knows. i actually don't have any idea. >> by the way across current. we're just getting word out of the washington post that the president is looking for 8% budget cuts at the pentagon. so those defense stocks many of them are still fractionally higher. but again, this is the tug of war we see in markets every day. >> morgan brennan. >> coming up. indeed. we'll see you tomorrow here on power lunch. >> all right guys thanks so much. welcome to closing bell. i'm scott wapner live from post nine here at the new york stock exchange. this make or break hour begins with another new high for stocks and a resilient market that just keeps on chugging. how long can it last? is the question. we'll pose that to our experts in just a moment. show you the scorecard here with 60 to go in regulation. more talk of tariffs. keeping the lid on the major averages a bit today. as you see though we're now green across the board dow a smidge. but the others doing pretty decent 6146 would be a new closing high for the s&p. some decent moves in tech as well today. nvidia and tesla leading the mag seven. a rough session though for arista networks. take a look. shares getting clobbered