>> malcolm etheridge yes. >> they just announced a dividend raise. but i'm focused on the pivot to data centers from distribution centers. >> okay. again good having you here jb. >> look at all these stocks. >> are up. >> that's great. >> what a coincidence. >> what a day for 3 a.m. still long. the stock wants higher analysts upgrades continue. >> all right. good stuff. i'll see you on the bell. >> thank you very much, scott. and welcome to the exchange. i'm kelly evans. more signs of a slowdown today. jobless claims up. pending home sales plunging to a record low. tariff talk bringing back inflation concerns. it's all got the fed in a tricky spot. and it's. >> spooking retail investors. >> the bearish sentiment just hit a historic high. we'll debate what it all means for the bull run. plus a weak consumer and additional 10% tariff on china were both mentioned in this company's earnings today. it's got the stock dropping like a rock. but our analysts just doubled down on her bull case. as always tweet me if you think

you. can guess our mystery chart. we'll talk about it ahead. and trump's gold card. there is a tax break hidden in it. we'll have those details and speak with the company that helps people buy citizenships across the world. they say interest in u.s. citizenship is coming from two places in particular. that's all ahead. let's kick it off with dom chu, who is back to give us our market read. and we're tilting lower. >> we are tilting lower, but off the worst levels of the session so far. >> kelly. >> but it is. >> mixed right now. >> and the dow is the outperformer of the day. >> it's up. >> about two thirds. >> of 1%. >> 3 a.m. a big part of that story there 43,007 15. it's up about 283 points for the dow industrials. so yes, the clear. outperformer the only of. >> the three major indices in the green right now. >> the broader s&p 500 continues its trek below the 6000 mark. we're currently at 5954. that's just about two points lower. maybe call it flat on the session. but at the highs we were up roughly 37 points and down 38 points at the lows. so an eerie amount of symmetry if

you want to look at it that way in today's trade so. >> far today. >> and just right in the middle of. >> that range. >> so we'll keep an eye on 5954 for the s&p 500 and the nasdaq composite at 18,009 57 is the clear underperformer, down two thirds of 1% or 119 points. one real driver behind that. we'll get to that in just one moment here. thematically speaking, over the last week, the weakness in the market has been driven by the three. key sectors out there the ones that encompass the so-called magnificent seven trade of technology, communication services and consumer discretionary stocks over the last week. these are the three. >> worst. >> performing sectors, and these three drive the bulk of the action. >> for how. >> the index overall performs. so as much as people want to focus on the broadening out trade, is it enough to overcome weakness in these three key sectors? that will be one thing to watch as we head into next week. and then the reason for the weakness in the s&p 500, and specifically the tech heavy nasdaq, has to be invidia shares. they're only down 3%.

it's not a lot. this is a much more volatile stock post earnings. and it has been for years at this point now. but it did beat quarterly. profits expectations revenue expectations. and the forecast was even good as well. there was some concern about some sequential, not sequential, year over year profit declines in certain parts of its business, as well as the revenue beat, which was the smallest, versus analysts expectations in roughly two years. nvidia shares, though, still a juggernaut, down 3%, up 62% over the last year. we are sitting right on top of that 200 day moving average, that longer term trend line. so keep an eye on one 2759 or thereabouts. that's one one level there that a lot of traders are keeping a close eye on for the long term. i'll send things back. >> over to. >> you literally just pennies above that right now tom. thanks. tariffs jobless claims the plunge in home sales all have investors back on edge today. let's bring in senior economics reporter steve liesman with more on the fed's path forward. as we see the market changing those odds somewhat.

and senior real estate reporter diana olick has the latest on the housing front. welcome to you both. steve, let's start with you. >> kelly. thanks. fed officials have begun expressing concern about. potential stagflation or higher. >> inflation and weakening growth. >> kansas city fed president. >> jeff schmidt earlier noting uncertainty from fiscal. policy and. >> higher inflation. >> expectations, saying. >> in a speech. >> quote, that. elevated uncertainty might weigh on growth. the fed could have. >> to balance inflation. risks and. >> growth concerns. >> last week, saint louis fed president. >> alberto musallam he. said that. >> the risk of higher inflation. >> and a weakening labor market is a. plausible scenario worth considering. >> jobless claims could be showing some early impact. could be, i stress. >> from the layoff. >> of. >> federal workers and. >> the cancellation of. government contracts. >> a cnbc. >> tally of. >> continuing jobless. >> claims from washington. >> d.c, virginia and maryland. >> shows they have risen. about 9000. >> since the end of 2024. >> that does. >> not include federal workers.

it could be from private. contractors to the federal government, or it could be unrelated. >> just got to be careful. >> there. >> a separate. >> measure of continuing claims by. federal workers is up. >> only 800. >> compared with a year ago, a time of seasonal increase in this. >> number here. but it's still early. >> workers may. >> not have filed. >> for claims. >> and or may not be eligible while still. receiving government paychecks. the president's top economic advisor, kevin hassett. telling squawk. >> box this morning that. investors should focus on the. >> entire package coming from the administration. >> which he said. >> is pro growth. >> if you look at one little bit and then make the worst assumptions, then maybe you can make it look bad. but if you look at the whole package, then we're looking for 3 to 4% growth for sure over the next four years. >> the market. >> meanwhile. >> is increasingly. betting on two rate cuts this year from the federal reserve. that could be difficult for a fed. >> that has. >> concerns about. >> rising prices and weakening growth. >> kelly. >> all right, steve, for now, thanks. but stay right there. that's meanwhile get the latest on the housing market, which is

just in a deep, deep freeze. diana olick is here with the latest details. diana. >> well kelly pending home. >> sales in. >> january fell to the lowest. >> level on. >> record, or at least since the realtors began tracking this in 2001. sales down 5.2% year over year. now this. >> count is. >> based on signed contracts. >> so. >> it's people out shopping in january, when mortgage rates were well over 7% for the entire month. these sales are an indicator of future close sales, and the realtors mentioned the exceptionally cold weather as west, which is where weather is really less of a factor. sales fall hardest in the south, which had been the most active region of the country. now this drop comes as inventories are actually significantly higher than they were a year ago. but it's affordability. it's just taking the toll because while home prices have been easing over the past few months, in some areas, they're still higher than they were a year ago nationally. and consumer sentiment is also dropping, which could be weighing on buyers. given that kelly, as you

know, a home is, for most people, their single largest investment. >> absolutely. dana. appreciate it. economists are split on how this tug and pull between a weak economy and sticky inflation will affect the fed and growth this year. my next guest still expects no more rate cuts and thinks we are headed for a universal tariff announcement. joining us now is adam posen, president of the peterson institute for international economics. adam, honestly, that would simplify the tariffs that everyone's trying to follow right now. do you think that's what this is all this is all about? >> well, kelly, thanks for having me back. i don't think it's in pursuit of simplification, but that's the direction. i think there are two big things driving the potential for across the board tariffs. first, that gets serious revenues, at least for several years for the budget negotiations. and if they do ad hoc tariffs by the president instead of across the board tariffs by legislation, you can't count it as revenues. the second reason is i think all

these announcements agree it's a strategy, is trying to set us up. markets and foreign governments as well as american citizens to accept a across the board 10 or 15% tariff is not that bad, compared to 25% on this and threat of 30% on that. so i think that's where we're going. and then that fits with you had kevin hassett clip on the idea that they're going to be trying to switch the tax code from having incidents on corporates and higher earners towards a consumption tax, and the tariffs will be sold as a funny form of a consumption tax. >> so in other words, adam, this is all about you know, it's a restructuring. it's trying to get to enough revenue. it's wanting to lean on tariffs maybe a consumption tax to do that. i mean it doesn't sound like a great recipe for consumers. >> no, i don't think it is. i mean, just to be clear, if eventually we have a consumption tax, we can argue whether it's

good or bad. and there are plenty of countries in europe, for example, that have high value added taxes, consumption taxes. it's not the end of the world, but transitionally if you shift a big part of the tax burden from one part of the economy to consumers, the odds of a consumer pull back recession go up. we saw this in japan, where japan, for revenue reasons, twice raised the consumption tax there markedly, and it was necessary. but both times it caused a recession. >> steve, just bringing you in on that, i mean, i remain a little bit skeptical that anything that big can get done right. they have slim majorities. we'll see what happens with the midterms. and, you know, we're trying to move incrementally in in one direction. but it's hard to imagine kind of an overhaul of how business is done, how taxes are raised in the economy. >> yeah. but it's interesting because, you know, i guess president trump can't have his tariffs and count them two if they're not law. and i think

that's the thing that adam is pointing us to. i thought about this idea. you know, kelly, there's 12 stages of grief. well for the fed there's three stages of tariffs. okay. first we got to figure out what they are. second, we got to know when they take effect. and third is the impact. and right now the we don't know the answer to either of any any of those any of those questions at all. and so that's creating this uncertainty out there right now. once they do take effect there's an interesting interim period here that i'm, i'm focused on, which is imagine all of a sudden a factory in canada becomes uneconomic because of the new tariffs. you don't immediately open up that factory here in the united states to provide that. good. there's a there's a an interim period here where you might make that shift. and i think any economist will tell you, kelly, that the idling of productive capacity is what creates recession. so that's really where you get this issue here of if there's enough

capacity that's idled because of these tariffs. it's why you could argue that if you're going to do this, you would implement them over a long period of time to give the economy time to adjust. >> i guess that's my point. adam, do we have a long period of time? does this administration have a long period of time? >> i think steve is absolutely right that when we're thinking about the impact, kelly, we have to think about these lags and what happens. i think it is entirely possible that it takes a while and they don't do all this. and then we saw with the way the house voted on their initial budget resolution, it's still behaving largely like the normal house. you defer to a president in their first year and their first budget, but president trump is pushing hard on this idea. he wants one big, beautiful bill. and if kevin hassett wants to talk about the whole package and they don't have across the board tariffs for revenue, then they have to kill medicaid. and if they don't kill medicaid and don't do tariffs, then they either are

not going to pass their legislation or they're admitting the deficits are going to go up to 3% of gdp, which they don't want. >> but but is that the most likely? i'm so glad you framed it that way, because that's why it's so significant. every time the president goes up and says there will be no medicaid cuts. and he said that multiple times in the past couple of weeks. so if there's no medicaid cuts, then there's got to be more from tariffs. and if economically we can't get there on tariffs, that probably means higher deficits. and the weird thing is the market doesn't seem to care that much. it's almost like they think, you know what goes up a few points. maybe we get some better gdp. like they just kind of taking it in stride. >> yeah. and i want you guys to find out why the market is behaving so weird. so i don't get it. i do think either way we're going to get inflation. because if hassett is right and we get three and a half average percent growth for four years and the unemployment rate is 4%, we're going to be overheating the economy again. and if we get a boom because of deregulation,

some of which is good, but also pent up demand for m&a and deals in sectors that were tied up by the previous administration, then you know, that's not sustainable. so in my view, as you flashing on screen, i think the fed sits tight because they partly for what steve said, partly politically. they don't want to be seen as prejudging the effect of the tariffs or the tax cuts. >> and that's why you have some people who say, look, and if the economy soft, but they feel like they have to sit tight for these reasons, it could be not a great formula for the year. gentlemen, we'll leave it there for now. hope to revisit it soon. adam posen, appreciate you joining us. of course, with our own steve liesman. meantime, the market has clearly shifted from tariff tantrums to worries about the economic soft patch. our next guest is trimming his high flying momentum stocks along with the whole market, it seems. joining me now is matt miskin, the co-chief investment strategist at john hancock. matt, do you want to pick up on what adam just said there? those kind of in the theory of all

this trying to figure out. i mean, the market in general has held up pretty well. but with each passing week, the tone has gotten a little bit worse. >> yeah. and at the top of the market, kelly, it's you know, the eye trade may be dead, but long live i heard it before. it was a great newsletter headline there. but what we're seeing is basically the heavyweights of the market, which made up 40% of the market. it was really concentrated, are struggling to find new highs in the mag. seven continues to struggle. we like midcap and quality value, things like healthcare, things like utilities and even industrials. as we go down in market cap, we're looking for high roe companies. but the old days of finding dividends and equity income are gone. the dividend yield on the s&p 500 is 1.2%, which is the lowest in history outside of 2000. there's just not a lot of dividend yield. so what you got to do is you got to find quality stocks trading at a reasonable valuation. we like high quality value stocks here to wait out some of this volatility. >> so why. what has changed. are

they just collapsing on themselves. the momentum names. >> yeah. so they got they got frothy i mean some of these got to a 600 pe ratio and were just trading at unbelievably frothy levels. and what you're seeing is the momentum trades. they're like locusts. they go all over the world and they just pick up on the new hot trade. be better than momentum. it's like be better than the gap and the momentum factor. just because the stock is up recently isn't enough of a thesis. we really want to focus on the fundamentals, focus on value here. and we're seeing a massive rotation in markets. so pick up some of that in that rotation. but momentum by itself can whipsaw fast. and as soon as it gets any kind of sniffing out of that rotation, it can fall really hard. >> so it's easier when we're talking about kind of the small cap, low earning momentum names to say, okay, sure. what about as we get way up there. what should we talk about? mag seven.

you know, software names. you know, real companies with real earnings. how do you know if they're part of this momentum play or not? >> we actually think that those had the fundamentals to back it up. i mean you look at the earnings season q4 earnings season was awesome 18% earnings growth. and basically we put on a bow on it yesterday with with nvidia reporting but 18% earnings growth. i mean, if you had told me that in retrospect it's four percentage points above where analysts had thought it was going to be at the beginning of the quarter, that's really high. the market is giving it no love. and the reason why is because of this macro headwinds, because of these headline risks. but we actually still see quality on sale if anything, because it's not responding to the better earnings. so we want to actually sniff out some of these higher quality stocks that are not getting the love right now. redeploy capital to them. again a little bit of a value tilt in there. but to not get, you know, kind of pushed away into other high fliers that you mentioned. >> and as you said, you like

healthcare utilities. i mean, obviously you have to be a little careful with some of the names there. but i guess my last question, matt, would be, did the market do so well last year because it was pricing in 18% earnings growth in q4. and is the sked now telling us that we're not going to stack up this year? >> yeah, we went back to back 25% gains. that historically does not happen often. it's only happened four times. the only time that you got a third year in a row that was above 20% was 1999. so you've got to really see a frothy extension here of kind of that momentum, low quality rally. we're starting to see that come off. we want to set expectations on equities that you might not be getting such great returns you have then. but if you're looking for some defense and a bit of dividends, we would tilt more value. it's going to help with protection on the downside. and you just got to be patient here because we just got to reset a bit. and we think we can actually find further gains as time goes on. >> all right matt thanks for joining us with that playbook. we appreciate it today matt

miskin with john hancock. coming up the disaster du jour. bath and body works worst day since last summer. after a soft outlook and warning of headwinds from tariffs. even though it has relatively small china exposure. b of a is going to bring us the other retailers most exposed to china. plus amazon now making the quantum leap announcing its first ever quantum computing chip. a day after unveiling that ai powered alexa. we'll look at how it stacks up with the competition and speak with the ceo of quantum name ion q on his second day on the job. shares are up three fold over the past six months, but are down today on an earnings miss and weaker than expected guidance. stay with us on the exchange. >> this is the exchange on cnbc. >> as pacific tensions rise, america's military demands cutting edge solutions and technology. meet air industries group, nyse, american manufacturer of critical components for what the us department of defense considers

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that's what you chose to ask it? i had other things planned. ask how to get up to one thousand dollars off the new samsung galaxy s25 ultra with xfinity mobile. scan the code now and ask about the bosley guarantee. >> welcome back. another headwind for consumers that are already showing some signs of weakness. president trump announcing another 10% tariff on china. one of the retailers getting hit on both fronts is bath and body works. they beat on the top and bottom lines in q4, but flagged china's tariff impacts in their full year guidance and said on the call they don't expect consumer trends to improve this year. the shares are down 11% as a result, but my next guest is staying bullish, reiterating her buy rating on the stock, maintaining a $45 price target about $9 above where we are now. lorraine hutcheson is a senior retail analyst. lorraine, it's interesting because they have relatively small exposure to china, right? they do. and in fact, the guidance came in a

little bit below consensus. >> not because of tariffs though. so the two reasons why the guidance. >> came in below where. >> we're expecting is number one. >> they only put about. >> half of the buybacks into the guide that we were expecting. what this means is they'll have 300 million of dry powder where they can, which they can use to either buy back stock or pay down debt as the year goes on. the second thing is some incremental it investments that we didn't have in our model for the back half of the year. both of those things to me are, you know, easily fixable. i think what is important here, and i think what's interesting about the stock today is it's sitting at a ten pe. there's a 10% free cash flow yield. they talked about the quarter being off to a great start. and they guided sales growth positive for the first time in several years. so we think this is a great buying opportunity today on on the weakness. >> i love it when you come on and say you know listen it's almost like you're more confident than the company's own management is, which is ironic, although maybe they're just being super conservative. one note of caution could be their

exposure if we do get a universal tariff. but even then, i mean, 85% of their production is in north america. they should be completely insulated. >> yeah. >> i don't really. >> think the tariff story is a big story for bmw today. i think it is the conservative guidance that's getting people a little bit nervous. and look, if i were a management team guiding today for this calendar year 25, i'd be conservative too. we don't know what's going to happen, what the consumer impact of these tariffs will be. and what we've heard so far remember we're very early into consumer earnings season. what we've heard so far is the companies providing a more cautious tone because the customer is looking right now. they're looking for value. they're looking for great deals and they're bracing themselves for higher prices. so i think that the what we'll hear for the rest of consumer earnings season is a relatively cautionary tone on the top line. and the places we want to be are where there's a product that the consumer really wants. and i think if we're looking at bath

and body works, that's a disney collaboration that they launched a week and a half ago that is getting rave reviews. so i think they have a lot of momentum right now, but they're reluctant to build that into their full year guidance. >> one more i don't want to harp on this. we can move on. but when we say that 85% of their sourcing exposure is north america. look, i mean, could that make them vulnerable in the case of tariffs on mexico and canada? yeah. >> if you look at mexico and canada, each are about 3.5% of their imports. so relatively small exposure i would say, you know, in the case of a 25% tariff, it would only be about 20 to 30 basis points of margin impact. >> all right, then i take your prevailing point. and i'm going to be watching on reels for the disney collab to see if that is gaining some broader traction. so who else do you think is actually quite exposed? maybe a little bit of caution? and who else do you think has the right product mix that can carry them through? what could be a tough year? >> you know, we continue to think off. price is well positioned in an environment

where tariffs continue to build. they buy very close to need. so most of what they buy is domestic already that so it's imported already. they're not the payer of record on tariffs. and they can zig and zag into the products that are working at really sharp value price points. and that's what the consumer is looking for. we heard from tj yesterday with a really good fourth quarter and a solid guide. they have a lot of confidence in their ability to offset this. so that's really where i would focus because of their their resilience and how quickly they can move around from country to country or product to product. >> and finally, who else has i don't know if you would say, well, you know, by default, if they have high china exposure, you're cautious or if it's just a coincidence. but what are what would be some of the names on that list? >> you know, high, high china import exposure is almost a thing of the past for retail. if you look across my entire group, they have reduced their china exposure to less than 10% of their us imports. why did they

do this? they did this because of the 2018 and 2019 tariffs were so costly when they were initially enacted that they they shifted very quickly to other areas of southeast asia. i think the biggest risk to my group is a universal tariff where all imports are taxed. then we could see a lot of margin pressure, but if it's simply china, we think it will be manageable. >> less than 10%. that's quite a statement. high china exposure is almost a thing of the past for retail. >> it's you know they learned their lesson with the last go round. and in fact this has been a decade long trend moving out of china into other areas of southeast asia where labor is much cheaper. right. labor intensity for making apparel and footwear is very high. so they've been trying to do this to save costs for a long time. this sped up in 2019 after the initial tariffs were enacted, and it's only continued. >> and so interesting lorraine. appreciate it. thanks for checking in today. lorraine hutchinson with bank of america. coming up, an inside look at the hidden tax break for the wealthy. that's part of

president trump's proposed gold card visa program. robert frank has the details, and we'll speak with one citizenship by investment expert who's already fielding calls about the program, especially from asia and the middle east. we're back after this. >> 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 are a leader in public and private markets, digital assets and custom tax management, empowering advisors with solutions to build the portfolios of the future. today. franklin templeton your trusted partner for what's ahead? >> what makes a comfortable retirement? it's having the money to retire on your terms. that means having a smart plan for how your money i invested, how long it needs to last, perhaps where it will go when you're gone. creating a

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back to the exchange i'm julia boorstin with your cnbc news update. an investigation by the israeli military found the army misjudged the intentions of hamas and underestimated the militant group's capabilities. the report released today, recommends israel create an intelligence unit to evaluate warning signals. the findings did not assign specific blame, but several high ranking officers have already resigned. a warrant issued by the santa fe county sheriff's department said the deaths of hollywood legend gene hackman and his wife were, quote, suspicious. the warrant noted the utility provider did not find any obvious signs of a gas leak. the utility said it's cooperating with the investigation, and goldman sachs is the latest wall street firm to roll back its diversity goals in a key regulatory filing. the goals it set in 2020 for women, hispanic and black representation in its workforce were not mentioned in today's

filing. in a statement, ceo david solomon cited pressure from the trump administration for this decision. back over to you. >> this gene hackman story. julia, i can't imagine what people are thinking. i mean, there's no explanation yet. >> yeah. i mean, i think there was a lot of speculation that it might be tied to a gas leak. he, you know, he was 95 years old. but i think this update here, that maybe it was not tied to a gas leak is a real surprise for many. >> right. and in this in the ap story, it says he appeared to have fallen according to one of the people. so anyway, we'll learn more soon hopefully. julia for now. thanks. appreciate it. julia boorstin. coming up the quantum stocks took off toward the end of last year. but now they're giving back some of those gains. that includes iron q which is lower today after an earnings miss and weaker than expected guidance. we'll speak exclusively with the ceo who's joining us on his second day on the job right after this. >> what if there was a cruise that felt like no other? a

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sale and make your dream office a reality. >> strategy at the market's final moments. >> we're now in the closing bell market zone here to break down the crucial moments of this trading day. >> market zone commercial free coverage sponsored by e-trade from morgan stanley. trade commission free today with no account minimums. >> amazon jumping into the quantum computing race with its first chip. just the latest tech giant to make a big play in this space. let's bring in deirdre bosa with the latest for us in today's tech check. hi deirdre. hey kelly. so the quantum. announcements over the last few months there have. >> been many. but there is still

a. >> massive delta. >> between google and its megacap peers. take qubits. this is a key metric because the more of them, the more powerful the quantum computer capable of solving bigger, more complex problems. amazon's new ocelot chip has nine qubits. microsoft's majorana has eight. google's willow dwarfs both of them at 105 qubits. now, other metrics matter, like quality, stability, error correction. but google is also pushing through real world demos, which help give its announcement the most immediate market impact, boosting google's stock and setting off that quantum bull run among smaller, pure play companies. but being ahead is a position that google investors they may be familiar with, and they should also be wary of, given the state of play in artificial intelligence right now. google is a paradox in the race. technically, it's winning, but it still has that adoption problem, often leaving great features in beta rather than rolling out widely and letting users like openai and deep sea take us lunch. so, kelly, let me bring this back to quantum. if it is the next frontier of tech

dominance. google can't afford to make the same mistakes. being first doesn't matter if it can't capitalize on it. of course, the debate will continue whether we're two, ten, or 30 years away from truly useful quantum computers. the next key data point, though, will be nvidia's quantum day that's coming up in march. and remember, jensen huang about a month ago, basically killed that rally in its tracks by saying this is, you know, maybe 30 years away, but, you know, amazon, microsoft, google, these developments could bring that timeline a little closer. >> super interesting. deirdre thanks deirdre. bosa appreciate it. shares of one of the biggest players in quantum are lower today. ionq is down 13% after an earnings miss in weak q1 guidance. granted, it's up 125% over the past year, and the company says quantum will be a disruptive force in the global race for ai. joining me now in an exclusive interview is nicholas demasi. he is the ceo and president of ionq. nicholas, welcome. >> honor to be here. >> so you're the back story here is so interesting. you were on the board. >> i was.

>> you said, you know, you might have had something to do with this company's existence all along the way. it was one of the first quantum names to come public. it's still maybe the biggest. >> yeah, absolutely. i mean, look. >> and now you're the ceo. what happened? how did we get here? >> well, i've been following ionq's technology for about 25 years, ever since i was a physicist at cambridge university. i had the privilege of being able to sponsor its ipo in 2020. we were the first. we were the best capitalized independent player in the market. i would argue that we remain the 800 pound gorilla of the category, right? whether you look at revenue, market cap, capitalization, you know, expertise in how far ahead we are in real world applications. >> let me ask you something. what do you do? what is a qubit? i understand on a on a on an intellectual level that quantum is going to break crypto and all this stuff. but like what today does quantum computing do? i'd love to know. >> well, so look, quantum computing i think about as the third leg of the stool in the computing ecosystem. right. so we you know, we had cpus and i can remember ten years ago when intel was busy bashing jensen

and nvidia and saying gpus would never matter. right. and i find that sort of ironic that our market cap is about the same as. so now jensen is saying, right, qpus and quantum processing, but there will be a day when all three of these sit along side each other. >> so you're you're involved with qpus quantum processors. >> exactly. >> and so bigger. do they have more connections? what are they? >> well, we're going to solve problems that no one else can solve in the world because of the beauty of quantum mechanics. right. so quantum mechanics allows you to effectively perform a lot of calculations at the same time on really large, meaty, complex problems with huge data sets that have lots of permutations. right. lots of combinations. right. so the examples that you used are some of the things we can do or will be able to do right now. you know, i think has been a company that i've always loved since ipo because we're focused on winning the technical race and the commercialization race. right. so we're partnering with people like astrazeneca on computational chemistry and drug design. we're partnering with people like ansys on computer aided engineering. you know,

we're partnering with general dynamics on things like fraud detection, anomaly detection. >> and do you think you're already ahead? because i've been in amazed by ai. i mean, watching this technology really arrive and what it can do, and that's just for a retail user like me. is quantum a quantum leap better than ai in doing all of what you describe? which sounds to me like the same use cases that ai is pitching itself to solve. >> well, quantum ai is not the current state that classical ai is today. it's going to be the next leg of the stool, just like gpus are the next leg of the stool from cpus, right? we very much consider ourselves to be a disruptive computing company, and we think that our future is as bright as, you know, nvidia was a few years ago, for example. so it's going to be an exciting exponential ride ahead because as we make advances in our computer, we gain exponential computing power. so i'd say the quantum computers move ahead kind of doubly exponentially. it's not moore's law. every two years, every time we add a qubit, we're doubling the power of our machine. what's a qubit? a qubit is, you know, effectively a unit of computational power in the

quantum world. got it. right. and there are different ways of making quantum computers. you've heard microsoft has a strategy. google has one. amazon just announced one this morning. all of those players are behind us on the actual maturation of their r&d roadmap. some of them, i would argue, are a decade behind us, ten, 15 years behind us. i mean, when people talk about a prototype and they've done something once and they have one qubit, you know, we've got dozens of qubits on the way to hundreds of qubits in the next year or two. and we think it takes about that many to do this useful stuff that we're already driving gaap revenue around this year. right. we're the only company in the space that has guided to, you know, $80 million of gaap revenue this year in the midpoint. we're on our way to nine figures of gaap revenue next year. >> would it even make sense to compare? so if i said, okay, let's take a security you mentioned for one of the companies that you follow, you know, you're you're making the sales pitch and you've got, you know, three ai players over here, well capitalized big brand names. and you say you should go with us because, you know, even

quantum or no quantum, what is the what is the because for customers in the here and now. >> the because is we're the only person that's actually commercializing, scaling, manufacturing and doing useful stuff with quantum computers today. we're not saying that we're going to beat, you know, chatgpt for today. the examples i just gave you are what we're doing today. but as our computers get more powerful, what people always forget about the space is it moves forward kind of exponentially. so if five years ago, no one thought chatgpt one was interesting, right? two, it was a hobby, right? all of a sudden, three comes out like, oh. it's so true. look at this. right. and so what i remind people is when i did the ipo with peter chapman, our executive chairman of i think we were first. and people thought, you know what, quantum computing five years ago, look at where we are today. every every fortune 100 ceo, cto knows they have to be partnering with us and doing this. imagine we will be in five quarters, let alone 2 or 3 years. >> all of that said, quick last question. when you watched the retail investor base get really excited about this technology,

did even you think, okay, you got to be a little discerning about where you're putting this capital to work? we're going to see a lot of volatility if we're kind of this early innings of this game. >> well, we've been a really great steward of capital. i mean we've we've spent our money on advances not just in computing but also quantum networking, which is an important second term for us. the quantum networking business we think is as big as quantum computing. and we've made a couple of acquisitions in the space. we've added sk telecom as a customer, singtel, jpmorgan epb in tennessee. right. so we've done two quantum networking deals. we are actually currently announced yesterday. we're raising capital to keep expanding our networking presence. we've got 900 patents right. so when i say 800 pound gorilla in the space, i mean there's 500 in computing that we have 400 networking. that's an incredible moat that we've built so rapidly in the first few years of our life as a public company. >> again, there's so many new technologies. and to be talking about being at the vanguard of this one, even while we feel like we're still at the vanguard of the other one, is amazing. i mean, so you think the moment is here? we don't have to wait 30

years for. >> this networking 100%. listen to the customer i've just mentioned, right? they're all household names, right? we're going to keep growing with our customers. we're going to keep adding customers. we're going to keep adding revenue. but we're a company that's focused on, you know, growing up and fighting this, fighting this fight, as you say, with the big boys. we think we have a significant r&d lead. we think we're getting all the customers right. and so i'd say, you know, watch the space because we're gonna continue to execute exponentially. and, you know, can't wait to we're going to be having this chat, you know, next year or year after and so on. >> please come back and we will revisit it. absolutely. niccolo de masi, thank you for making the time. thanks for having me. appreciate it. ceo of ionq. still to come check on shares of tesla lower today, on pace for a six day losing streak and dipping back below the trillion dollar market cap level yesterday. we're at 933 billion today. if you're keeping track. and palantir also on track for back to back weeks of double digit declines for the first time since august of 22. slight rally today, but the shares are down about 25% since feb 18th. as the market unwinds, some of the momentum plays. we'll be

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my own reporting to share insights, information, and all of the details that you need to be able to make money. >> welcome back. stocks are in kind of a holding pattern this afternoon. the dow's up half a percent boosted by 3 a.m. the s&p is basically flat and the nasdaq is down about half a percent for 30. we just ticked back up to on the ten year by the way. coming up we'll have more on president trump's gold card the $5 billion path to citizenship he hopes attracts not just wealthy foreigners, but also companies looking to bring top talent to the us. and while the gold card doesn't come with job creation requirements, he touted that potential in the first cabinet meeting of his second term yesterday. >> the people that can pay 5 million, they're going to create jobs. they're going to spend a lot of money on jobs. they're going to have to pay taxes on that, too. so they're going to be hiring people. they're going to be bringing people in and companies in. and i don't know, maybe it will sell like crazy. i maybe it will sell like crazy. i happen t at ameriprise financial we know our clients

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to citizenship for foreigners, potentially, if they can afford the $5 million price tag. robert

frank is here with that story and some other parts to it. robert, like big tax incentives for the applicants. >> yeah good. kelly good to see you. well, this is president trump saying his new $5 million gold card will start selling in just two weeks. now, immigration attorneys saying they're already getting calls from interested clients. one reason is that tax loophole that would give the overseas rich a tax benefit not available to all the other americans. so here's how it works. u.s. citizens and permanent residents currently have to pay income taxes on all of their income earned in the us and overseas. gold card holders will only be taxed on their us income. their overseas income will be exempt. attorneys say it's really the only way the global rich would want to become u.s. residents. now, over 60 countries currently promote some kind of investment visa program. a record 135,000 millionaires will move to another country around the world this year, with the uae and the us being the top destinations. now for a lot more

on the gold card, where the wealthy are getting their visas and this tax break, you can check out the inside wealth newsletter cnbc.com. inside wealth that's cnbc.com. inside wealth. >> never ending list of things to write about. this now being the latest one robert stay right there. let's bring in our next guest whose firm is one of the leading players in citizenship by investment. he says they've already been fielding a lot of questions about these gold card plans, but even more interestingly about the potential end of that eb five program. let's bring in basil morales. he's a managing partner at henley and partners. basil, it's great to have you here. and we'll just start with the gold card idea. you think people would already be jumping at the opportunity? >> i think there's significant interest. everybody is very curious about what that will look like. what will be the criteria? i mean, they know the eb five. it's been in place since the 90s. they're just wondering what that additional premium or the 66x amount that they're going to be giving or investing. what does that come

with in terms of pathway to citizenship? what are the tax benefits that robert alluded to earlier? so we're certainly getting interest on the phones are off the hook. >> the eb five program as i understand it, is more for disadvantaged areas. is that right? how, how and a lot of people say it's been plagued with problems or fraud or it just hasn't lived up to expectations. so what has it done? who is involved with that? who would be affected if it did sunset? i'm not sure if it would, but if it did. >> so it's completely normal that that over time we have changes in programs. as i mentioned earlier, the eb five has been in place since the 90s. they had a recent change, probably in 2022, from 500,000 to 800,000, and the demand still continues. now, certainly there were certain investment projects that perhaps didn't come to fruition, but there are also other viable projects that are stable with good track records. so the eb five program, although it has its problems, was it was a widely successful program. now, due to the outstanding demand, i'm truly i'm not surprised that trump is trump is

increasing the threshold because right now the program is quite successful. but perhaps it's going to be even easier with with the gold card. but that to be seen depending on, you know, the residency requirements, the taxation requirements, in addition to, you know, where that 5 million will go. >> so do you think you'd have a list of tens, hundreds, thousands of people who would want to do this? do any other developed countries offer something like this? >> they do, they do. so you have new zealand that that has a program. you're looking at around 5 to 10,000, excuse me, 5 to 10 million nzd as an investment. you have malta that has a route to citizenship, that it's approximately around a million. that takes 18 months. so these are pretty popular programs. golden visa programs have been there for quite some time. the purpose is to stimulate the economies. and now it's really gaining popularity. people are investing more and more into these programs. so i think the us has a very interesting value add in everybody's passport portfolio or residency portfolio. i mean,

37% of millionaires of the world is in the us. 32% of the world's investable wealth is in the us. the they're still inheriting the majority of millionaires right under the uae. so that being said, i mean, with top tier healthcare, top tier education, vibrant economy, the us has quite a even though the 5 million might seem expensive, it does have a very strong value proposition. >> and robert, i was going to go ahead. but just going to ask you the rules of how this would work for people from different countries would be based on what the rules are in their home country to some extent, right. >> typically, yeah. and basel, as you just mentioned, you know, the whole business of selling investment visas to the wealthy has exploded. it's now $20 billion a year. and in the us we have this interesting crosscurrent where a lot of the wealthy overseas, especially from china, want to come here. but we also have your firm a record number of americans wanting second passports or investment visas outside the us, potentially as a plan b or

wanting to leave. explain what seems to be a contradiction where rich people want to come here, but the rich people in america also want to leave, or at least get second passports somewhere else. >> that's a great that's a great comment, robert. thanks for that. every single country, every national wants to diversify, right. so the us citizens sitting in the us, yes, it's a great economy, strongest economy in the world, a lot of great health care, education opportunity. however, americans are starting to think, well, will it always be like that 50 or 100 years from now? what will the us look like? so they're starting to hedge their bets. hedging gains geopolitical risk. on the other side china, india, the middle east. you know they were not necessarily born with very strong passports. they can travel elsewhere. so they're looking for strong passports to better their life, have access to that healthcare, that education, that business opportunity. so i wouldn't be surprised if you know, other the ultra wealthy elsewhere, they don't just want the us, they want the us, but they also want other countries that are going to hold residencies and passports. and the us citizens

are not relocating, they're not moving. it's not their intention, but they want to be prepared in the event they need to. and the ultra wealthy in other countries want to do the same. >> robert, a quick last comment. >> well, it's interesting that it's really about portfolio diversification, but for your citizenship. so we hedge our portfolios with cross country risk. and now people say i don't want to be tied financially or even financially to one single country. so it's this whole exploding idea of passport portfolios where you're truly diversified. >> it is super interesting to think about it that way. gentlemen. thank you both. appreciate it more. joining us from henley and partners and of course our own robert frank. and as mentioned you can read more in robert's newsletter, inside wealth. that's it for the exchange. i'll join john chu for power lunch right after this power lunch right after this quick at&t has a new guarantee. because most things in business are not guaranteed. like a distraction-free work environment. -yeah,i'll circle back around. -get those steps in, kevin. your coworkers keeping things confidential. [phone ringing]

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with one chef for every ten guests, indulge in gourmet dining on an ultra-premium small ship. scenic days, endless memories. call now for amazing savings. book now at oceaniacruises.com >> welcome to power lunch alongside kelly evans i'm dominic chu. the markets are grappling with some big issues today, including the president's latest insistence that tariffs will go into effect without further delay. kelly. >> plus more signs of economic weakness on that jump in jobless claims and pending home sales falling to their lowest level on record. >> now, despite all of that, markets are holding up relatively steady. as you can see there, the dow is up 230 points. >> kelly yeah. and the s&p is going between gains and losses a slight gains at the moment. slight losses i should say