well, that's it for us this week. be sure to follow me on twitter, facebook and instagram, and i'll be back next week with more in-depth interviews right here on "the wall street journal at large." thank you for joining us. ♪ ♪ ♪ ♪ jack: welcome to "barron's roundtable" where we get behind the headlines and prepare you for the week ahead. i'm jack otter. where does bank of america see the economy come going this year? ceo brian hoin moynihan -- moynihan will join us. and later, todd alston will give us his stock picks for 2021. but we begin, as always, with what we think are the three most important things investors ought to be thinking about right now. the crazy, frenzied trading in gamestop and other stocks has

scooped wall street. we'll explain what's behind it. meanwhile, economic indicators are holding steady, but mixed news on vaccines. and it was a busy week for earning. tech stocks apple, facebook and tesla reported strong numbers. on the round table, my colleagues, ben levisohn, carlton english and jack howe. jack, who knew that the biggest story on wall street by far would be about a store that sold something i didn't think anybody bought anymore? >> video games on disks in malls at a time when the outlook is tough for disks and malls. by now people know the basics, this was a heavily shorted stock. it went for $5 a share last summer. it had gathered attention in a reddit chat room called wall street bets. and there were some bulls. there was a former founder of chewy who had taken a position. he won board seats earlier this month, and that got the stock

from $5 to 20. and then it hit what i'll call mem e-trade status. there was this -- meme trade status. short sellers have to scramble to buy stock to contain their losses, and that buying contributes to the surge. there was also record volume in call option, and that can push stocks higher too because the market measures for options sometimes buy shares of the stock to hedge their exposure. gamestop became the most traded stock in the world, went over $ $400. there was a hedge fund out there that had to raise a couple billion in capital from some of its rivals because it was short gamestop. some brokers blocked buy orders, you know, on gamestop. some of the other stocks like amc entertainment, the theater chain. robinhood had to raise capital. it did it preemptively just to cough some of its -- cover some

of its exposure. jack: so the short squeeze phenomenon, while insanely dramatic, we've seen that before. what's new here is this generation that understands the internet better than the hedge fund guys, right? >> yeah. jack, i'd like to show an important, highly technical graphic if we could put that up on the screen, please. this is the an old meme called grumpy cat, right? if the photo is an underlying theme, and there's a variation on the theme which is that you add your own caption of the cat saying something grumpy. that's a meme and, of course, they spread virally on the internet. if you're wondering how gamestop gets to $400 a share, i think it's helpful to think of it as a mers me -- meme trade. we saw that with amc, the theater chain, we saw it with a company -- tiny company called

bb liquidating which controlled the remnant it is of blockbuster video, and we saw it last summer with hertz, the car rental company, after it declared bankruptcy. there was another theme this past week where amc networks, the television company -- not the same as the theater chain -- it shot higher too. think of it, that's another meme. we've seen the same thing happen with zoom, you know, a couple times in the past year and a half, let's say. the meme is they're getting the ticker symbol wrong. i spoke with the creator of wall street bets this past week, and he basically said who are the fools? these guys are making a lot of money trading on the wrong ticker. i'll just say, jack, i think what's happened here that young traders who are, have a lot of -- feel kind of left out of the official, have figured out a way to monetize iden assets --

hidden assets, and that asset is their ability to spot memes developing faster than the rest of us. jack: we also have to acknowledge there were some big boys playing here too, we spoke to a trader who sold 10,000-share blocks. ben, this worries me a little bit about market stability going forward. should i be worried? >> yeah, you should. i mean, this kind of thing, it hits sentiment. you get hedge funds that have of to coffer their shorts, have to sell their longs, other hedge funds just because volatility has spiked are going to reduce risk, and people say i'm not feeling so good, they're going to sell as well. you also have things going on that aren't so bad. you have the economy, it's not growing as fast as we would like, but it was still up 4% in the fourth quarter. we got some news from johnson & johnson about their vaccine. people were hoping for 80% efficacy, they got 66, but there's still enough good news

in the details that it probably does help with the reopening. andif the economy can reopen ths summer, everything should be okay. jack: carlton, does anybody look at earnings anymore in we had some tech stocks that gave us pretty good numbers. >> you know, in any other quarter apple having $111 billion in revenue, that would be all we were talking about this week, what's the iphone doing and all that. they actually have been pretty good. they've come in about 1.6% lower than last year, but you take out energy, it's actually 2% higher, and about 84 of the companies -- 184 of the companies in the s&p that have reported so far have beat on expectations. so we are seeing good earnings data this quarter. the big thing next week is alpha bent and amazon -- alphabet and amazon on the heels of apple and microsoft this past week. jack: coming up, we'll get reaction to this week's trading

frenzy from bank of america ceo brian moynihan. he'll also tell us “could have been me” by the struts hey, mercedes? how can i help you?

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♪♪ jack: the major indices plunged friday after a short-selling frenzy, but should investors focus on the economy ahead? joining me now on why stakeholder capitalism is important, bank of america chairman and ceo brian moynihan. brian, it's great to see you again. look, i know that all this frenzied trading in gamestop is probably not happening on your platforms, but i'm sure you're keeping an eye on it. what is your take? >> well, there's a lot of volatility out there, and it was an interesting week. but the good news is our team did a great job serving our customers and doing a great job.

so first, jack, i hope you're safe. you did mention a key thing, what's going on in the economy, and one of the big pieces that came out today is our research team upped their gdp estimate for 2021 is in the united states from 5 to 6% which is a pretty strong increase on a big economy like the united states. so that was good news. and the second big thing on the economy which will long term show up in the stock market over time is that we have seen in the month of january so far our bank of america consumers spend at 9% greater rate this year than they did last year. so remember last year was up about 8 or 9% over the year before: so the consumers that have money and are employed, and there's a lot of them that still need help, are out there spending. and that's good news too. our team upped their estimate from 5 to 6, it's a pretty big day. jack: so when you're comparing consumer spending, that's prepandemic. that's impressive.

>> yeah. last year the month of january, you and i were in davos, and i don't think we were thinking about being home almost continuously. up 9%, and that's across -- it'll be $250 billion in spending this month. jack: wow. speaking of world economic forum, you noticed that bank of america and 54 other companies will be announcing regularly sustainability metrics and how you're hitting those goals. can you explain why that's important? >> well, why it's important, because it basically defines stakeholder capitalism, but why it's really important, at the end of the day, you know, we are a big believer that to drive the world, we have to build for our hair holders and for society. shareholders and for society. jack: can you give us a come. examples how -- couple examples how this changes what you do? what do you do about something like climate change? >> well, sustainable goals that

190 countries signed on to, this is what we need in the world. i'll give you a very specific example. the environmental which is, obviously, getting a lot of note with john john kerry expect announcements made about paste and the united states -- paris and the united states rejoining, these are critical elements. jack: one quick question, brian, a couple years ago you told me that you had recently signed a 200,000-page report you had to do because of government regulations. if joe biden called you now and said how should he be thinking about banking regulations, what would you tell him. >> >> well, the first thing i'd say is think about last year. we didn't know the greatest economic decline of a quarter probably in history, we'll figure it out but it's close, was going to happen the next quarter, in the second quarter of 2020, and what could the banks do? the banks were there to help lend to the customers, $70 billion in loans in three weeks,

$200 billion in deposits in three or four weeks, we were there to help our customers with customer assistance, we were there to help with the ppp program, 350 thousand ppp things, so what you didn't hear about was the banks having trouble. so the regulations worked. that's the simple answer. an unexpected, you know, going into the wall at 90 miles an hour economically, and at the end of the day, the banks supplied capital, liquidity, supported the markets. and with the fed and, obviously, the administration moves they made, we came back out of this economic cycle back to, you know, back up 30% in the third quarter, and we're growing from there. that was a good turn. so in terms of regulation, it worked. now as we look forward, we need to keep making sure it gets simplified and if it doesn't take 200,000 pieces of paper after nine or ten times, maybe we could be a little more rational and focus on the substance of what we're trying

to do, make sure our companies can operate the way they did last year. jack: thanks so much, brian, i really appreciate it. >> thank you, and stay safe. jack: thank you, you too. coming up, which companies look good for 2021? we've got interesting stock picks from some of the country's top investment experts. that is next. (judith) at fisher investments, we do things differently and other money managers don't understand why. (money manager) because our way works great for us! (judith) but not for your clients. that's why we're a fiduciary, obligated to put clients first. (money manager) so, what do you provide? cookie cutter portfolios? (judith) nope, we tailor portfolios to our client's needs. (money manager) but you do sell investments that earn you high commissions, right? (judith) we don't have those. (money manager) so what's in it for you? (judith) our fees are structured so we do better when our clients do better. at fisher investments we're clearly different.

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♪ ♪ jack: earlier this month barron's held our annual round table with expert investors to find out their forecasts. lead portfolio manager todd olson is a round table member, and he joins us now. todd, thanks so much for coming on the show. i've got to start with the gamestop short squeeze. is this a cultural watershed or just a good, old-fashioned

speculative frenzy? >> jack, honored to be here today. there's a lot to unpack there. the overarching thought that i have is, you know, long-term, large cap manager that's been doing this for 25 years, it sure feels a lot like speculative frenzy and euphoria going back to 1999. but, jack, what i want to do is unpack this a little bit, and what i think's going on here is really this is a situation, there's a lot of narratives, but this is really almost like holding up a mirror to our society right now. we've got on one narrative, you know, millennials and g e n-zs that are potentially upset at the system and the wealth inequality. we've had a new technology platform with social media where things go viral and then trading platforms to tex cute trades -- execute trades quickly. that's a perfect storm. third, we've got the stimulus checks that are going out to people, and they want to put

that money to work. number four, people do have time and at certain points boredom to participate. and then finally, the market structure, jack, with all the passive flows that are going into the market, it's a much more fragile time that even small amounts of trading can make bigger moves in stocks. and so when we wrap this up where i think we are, jack, is that this is happening, i believe, now in. respect to all those narratives that this market is up, the nasdaq's up 100% from the bottom and the s&p's up 70. so this is really a perfect dry tinder to express all this now. and this is why i believe humbly it's happening now than happening, say, last april. jack: thank you. that is a very helpful way to get how our heads around it. but let's quote ben graham. in the short term, the market's a voting machine, in the long term, it's a weighing machine. what are the big picture things moving the market perhaps long beyond the gamestop story?

>> so really where i think we are is we're looking at an economy that's coming out of the pandemic. so i think that here and now, this is really built on stimulus and really cushioning the blow. the second half of this year really going to be a reopened, vaccine-led recovery. so when you really think about the long-term value, the long-term dynamics, it's really important, i think, to be invested in long-term secular trends, innovative companies, strong companies and, you know, quoting ben graham, companies built to last. and that's generating cash flows, innovation, margins and being in the mega-themes that, i think, are driving this economy and, importantly, invest in companies that are going to come out of this pandemic stronger x. then also companies that are treating employees well, building themselves to last in this environment that we're in where, clearly, some of the environmental, social and governance things are more important than ever to build a great business for the long haul. jack: i know that's been crucial

to your approach. are let's do two quick stock picks, first, cme group. >> right, jack. so cme, for the listeners and watchers here, it's an options exchange where you can hedge, you know, interest rate futures and other instruments. so for us, we think it's a perfect mace to invest long -- place to invest long term because we think volatility's going to go up. interest rates, you know, with all the dynamics, we think volatility goes up long term for rates. and number three, the trillions of dollars that are being printed and borrowed by the governments around the world, quite frankly, long term will need to be hedged. jack: give me one sentence on deere, and then the i'll move to the other panelists. >> yeah. john deere, iconic green tractors, precision agriculture. it's a tractor company long term going to a software company as tractors connect to the internet. jack: i remember riding my grandmother's john deere when i

was a kid. carlton, what did you pick out that caught your eye? >> looking at abby joseph cohen of goldman sachs, yum holdings, she shes it as a reopening play and could see revenue as much as 20% in 2021. jack: ben? >> i have a pick from henry, he likes sam adams and not for the beer. their hard seltzer is the second most popular. it's growing market share. they've been growing their revenues like crazy, he thinks earnings could triple, just loves the stock. jack: and, jack howe, what were you looking at? >> this comes from james anderson at bailey gifford, and the company makes lithography machines. this company has a technology edge, and its rival a based in the netherlands, james called it

the most important company in the world to the development of the internet, big data, autonomous driving and much else. sounds important, just over 40 times earnings. jack: and it's got an important price. jack, todd, thanks a lot for coming on the show. up next, our round table members give their investment ideas for the coming week, so stay right there. ♪ ♪ sarah, did you know geico could save you hundreds on car insurance and a whole lot more? hmm. so what are you waiting for? captain ahab to help you find a parking spot? thar she blows! whoops! loading zone. darn it. pull hard to starboard! too small! seriously? because it...ugh. oh! follow him! steady... steady... oh! thunderation! to the northern lot where there be parking spaces as big as whales! geico. see all the ways you could save. whitney and jane are always sharing tips on ways to save money. cvs carepass... it's my savings secret. carepass members get 20% off cvs health brand products.

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♪ ♪ jack: jack, earlier in the show you told us about a grumpy cat that's played a big role in this week's market frenzy, but there's also a dog we've got to talk about. >> yeah. we've got to give dogs equal time, jack. there's something out there, a cryptocurrency that had a billion dollar market value. it shot higher to a value of

above $8 billion at one point this past week, so what happened? well, it was another reddit chat room, and they got behind doj coin, but then tesla founder elon musk tweeted a meme. let's see that on the screen the, if we have it. it's a parody of vogue magazine, and i should explain dogue is where you put up a picture of a dog and you have a caption with bad grammar. traders took it to mean that elon was behind the dogue coin. and the currency went nuts. if none of that makes sense to you, jack, it's probably a sign that you're norm. [laughter] jack: thank you, jack. to be normal, we do need to warn readers -- viewers, look, if you're tempted to turn $5 into $483, so am i, but don't do it

with money you can't afford to lose. these things can come down as quickly as they went up. we have some more mundane but perhaps more investbl ideas from the panel. ben, what's your idea? >> it's boeing. the stock got an upgrade from morgan stanley on friday after releasing earnings that were basically the kitchen sink, had all the bad stuff in it x. their analyst basically thinks they have a clear runway and say it's a play to the upside. jack: that's kind of compelling. carpalton, what's your idea -- carlton, what's your idea? >> j&j did fall off on friday after of the vaccine came out a little bit weaker than people hoped for, but if you look deeper, i think it does have the opportunity to be a game-changer. it's a single dose. it can definitely lower the risk profile of the virus, so i think there may have been a little too much selling on friday. jack: thanks, carlton, ben and jack. to read more, check out this

week's petition at barron's.com and don't forget to foul us on twitter @barronsonline. wear your mask, be healthy, and we will see you next week on "barron's roundtable." ♪ ♪ ♪ >> from the fox studios in new york city, this is maria bartiromo's with "wall street." charles: welcome to the program that analyzes the week that was and helps position you for the week ahead. i'm charles payne in for maria bartiromo. president biden signing a record number of executive orders over the last week and a half. we'll look at the impact on jobs and american businesses still struggling amid lockdowns. and later, senator cruz sounds off to maria about the new climate change crackdown and the growing threat of china. the major averages going on a wild ride this week including the worst selloff since october on wednesday, volatility driven in large part by a surge in buying and a