>>ouncer: this is "nightly business report," with bill griffe and sue herera. hot economy. surges, bolstering expectations for muchonger growth, but is activity accelerating too quickly?> hen and now. comparisons are being made to the economy and stock market of the late '90s, but should you listen? power up. ile college kidsre mining bitcoin in that college dorms. those stories and tonight on "nightly business report" for thursday, june 14t>. on wall street, the nasdaq closed at a rord today. we'll have more in a moment. we begin tonight with the onomy, with more evidence it's heating up and firing on all cylinders, a they say.

first the consumer, a report out today on retail sales showed that spending was stronger than expected. retailers reported their biggest sales gain in six months. that's important. spending makes up the bulk our xhiblg activity. consumers may be shopping a lot, because the job m toss tighten. another report out today said the number of americans f for unemployment benefits fell to a 44 1/2-year low last week. al of this is leading to a rise in front of the of economic growth. the atlanta fed's latest model right now sees a 4.8% annualized growth rate for the economy in the second quarter. but the risksesre also increases. the international monetary fund says growing fiscal deficits will cause a slowdown in the and overseas. the tax cuts, while performs a r term boost came during a wt

period of g potential setting off a chain reaction. so clearly the economy is strong right now, but is the strength sustainable and for how long? joining us to talk about that diane swann, chief economist at grant thornton. always good to see you. thanks for joining u tonigh >> good to be here. >> i'm tempted to say it doesn't get any better thanis th but does it? >> well, that's an interesting question.ee we will well over 4% growth in the second quarter, and i think that will behe peak of growth for this expansion. so the good news is growth is accelerating, and i think we'll have the strongest years in he18 of expansion, which is 3%, the strongest year since the housing market peaked back in 2005. that's good as well. the problem is it does set us u for a bit of a sugar high. here pulling growth from the future. the request hes how much from the future and how long is it sustainable? >>ut what a the inflay

scenario. that's what the imf is worried about. >> is it kind of in the sweet spot, our given what oil prices have been doing lately, are we fast? to accelerate too >> jay powell did note oil prices, and we'll see higher than the target rate of thinflation in f because of the higher oil prices. nigh own view is we'll s some overheating. the fed has rcheted up four rate hikes, instead of three. the problem is we're ratcheting up inflati as well due to tariffs, so a y the factors together, we like a warming trend, we don'tant an overall hot flash that's really, really bad for the u.s. economy. we don't wayne to fry here. you're a economist not a forecaster, but is th the

environmental where profit grow? can continue to we're really running off the rox cuts this year that will support profith along with strong revenue growth. we do have margins n bit as we move into 2019. that's because we are wages to pick up, but also costs are picking up, everything from energy t prices some of those tariff costs and the costs of materials in those are things that happen later in a cycle. this year will probably be theb est in profit growth. >> diane, thanks again for joining us tonht. well, the economy of today is all drawing some comparisons to the commit of the late 1990s a periodest known for the rapid rise in tech stocks. the nasdaq hit a record, even as the blue chip dow pulled back. the dow jones industrial average fell to 25 points, the nasdaq was up 65 points, and the s&p 500 rose six. so should investors compare

today to the lat 1990s? mikean tolli takes a look. >> reporter: reminder of '90srs are app all over wall street. the economic and financial markets conditions are drawing comparisons to that period. good economic times and a technology boom culminated in a powerful bull marke that went to stunning extremes before collapsing. no two moments match up, but there are plenty of echos. usually an --tarts to hum, consumer and business confidence readings are near the historic highs, the fed reser is tightening, but not noticeably restraining risk-taking we even have a media merger fren featuring an acquisition of time warner, reminiscentf aol's bid for time warner in early 2000.

>> you'vgot mail. >> reporter: it's important to point out several crucial differences which together me it seem less overheated and hazardous than saying 1999. for one, stocks just aren't up as much as they were back there, and speculative energy is not ad wi today. the average annual return of the s&p 500 over the past five years is 14%. over the past ten years, it's 10%. from 1997 to 1999, the comparable gains were twice a strong. in 1999 there were more than 500 initials stock offergsn their first-day price gain was almost 70%. thing approaches that level of speculation is evident in and out valuations are high, but not nearly as hig as back then. the a dominancerguably better reflects the pervasive role in theconomy and daily life. back then most internet -- as an example, when aol reached a 200

billion valuation in early 2000 as it agreed to merge with time warner ted a mere 20 million subscribers, no real earnings. facebook at a 550 billion market value today has 2 billion users, last year earned $16 billion on 40 billi in revenue. even though the way the stock market backed off early this year after a relatively brief phase of exuberance shows this to more orderly less heedless market than the end of the 1990s. if this will eventual become a true rerun and there's a good chance it never will, it would have a long way to go before getting ther for "nightly business report," i'm mike sanll though 3/4 certainly similarities, mike just pointed out some stark differences. joining us to talk about this is jimon pau chief executive office at the -- grou >> goodo see you, sue. >> you point out differences,

you point to product why?ty. >> i think that was the center of the 1990s, bo was just a remarkable product activity boom on par witht maybe w we hadn't seen, you know, since the post war of0 s, '60s sort of era. and we're not seeing virtually any product activity growth. we're suffering in this recovery and continue to f almost report-low product activity. if you don't have product activity, sue, what tha allows you to do is hold dow the overheat pressure. it stretches the exist been labor force to produces more withoutausing cost toss go up. without product activity, we're starting to see some of those inflation and interesting rate precious, which we didn't until really late. >> there an area rightnow, m, where you see exec i was risks being taken. best any '90s it was the stock

market. re the financial collapse it was the housing market. what aboutno is it bitcoin? >> i don't really see the excess that would bring a recession right now. as you say, it's hard to see that. you also don't have the policy, you don't have an inverted yield curve, or, you know, we've only had excessive confidence for maybe a year. but there are some that could be problematic. i think private on equity is in a bigger bubble that is the -- there'seen a lot of investment in that over this entire cycle, a lot more companies have gone private. we don't know much about that market. losure, t of less di which makes it riskier overall. so i do wonder a bit about that possibility a a growing risk. we do have, you know, still sluggish growths in many parts of the world.eu pe, for example, even emer emerging worldlowing down that

could raefrt than the u.s. dying and killing oes the of the world, make this time it's different. there's risk whenever you have a recovery approaching ten years, but i've got to admit, i don't see it. i think the recoveries continues for a few more year, on anmi optiic note, thank you for joining us. time to look at some of today's upgrades and downgrades. we begi with oracle, which was downgraded to neutral from a overweig jpmorgan, the analyst cites lost business and says the companiesin are m from oracle software to amazon and microsoft platforms, so the price target is now $53. that stock fell nearly 5% today. ko. hl's was downgraded, the cites certains over weak traffic, and the stock has gotten ahead of itself. that price target is now $75.

nike's priarget was raise the to $82 at we hadbush that's the second highest target price, it cites accelerating growth, the firm maintains the outperform rating. amazon's price target was raised as well to 2100 by d.a. davidson, which implies a $1 trillion valuation for that company. the analyst cites the potentially for increased revenue from the private label products form the stock was up 1% to 1723.86. >> you're getting into berkshire hathaway territory. will the trade tensions with china come to a head tomorrow?

late today, the justiced department s it will not appeal that judge's decision to aapprove the $85 billion merger between at&t and time warner. the deal cld not b completed as early as tomorrow. >> the trade truce with china appears to be unraveling as white house prepares a revised list of tariffs. kayla tausche reports from washington. >> reporter: president trump met with trade advisers to finalize the list of chinese product the u.s. could hit with n tariffs as soon as tomorrow. the list is expect 20d itwlude ben 800 to 900 products, a d action of the 1300 products originally targete april. secretary of state mike pompeo is in china to discuss next steps onnoic, but w fh aday deadline looming, trade is on the agenda, too. >> we discussed trade today. or deficit with china is still too high. i stress how important under the

circumstances for president trump to rectify that situation. so the trade becomes more balanced, more riprocal and more fair. >> reporter: china's foreign nister says he sauce two outcomes. one is cooperatio the other is confrontation and lose/lose. of course, we are well prepared in case ameca chooses the second option. ime plans to retaliate. gary cohn said that would hurt the economy. >> if you end up with a tariff t , you will end up with price or inflation. >> those are all historic engreed cents for an k34i slowdown. i would not lik to see that happen. >> the two countries have been discussing a deal. both wou stand down on tariffs, china would buy more

goods to narrow the deficitnd the white house radio replace a ban with a fine and stricter oversight. but the zte portion has h a snag on capitol hill.ic repu senators moving to limit the president's ability to offer a reprieve. e implementation of tariffs would effectively end a one-month trade truce that had calmed financial markets going into this week's singapore summit. fo "nightly business report," i'm kayla tausche in washington. is there a way f investor toss protect their portfolios if trade tensions do escalate joining us with insights is david levovitz at jpmorgan. >> thanks for having me. >> gue there are sectors you feel you need to avoid. those that are most sensitive. >> if we end up wit that

lose-lose situation, we definitely want to focus more on thees dcally oriented industries, things like financials, smaller companies as opposed to larger companies and avoid things like basic materials. even technology. let's not forget a couple weeks ago we were talking about potentially impact on tech from a rise in tanks, so wite need to be if trade tensions escalate, we could find ourselves in an environment where these big global growth stories that have workedo well may begin to come under pressure. >> so financials and small canu uld use, but you also say stay away from bond proxies. why? >> exactly. when wehink about the high different-paying markets.gs ale another increase in the fed funds rate, and as was just mentioned. if we get into a trade war, the

tential to pick up is real. it will lead to interest rates moving at a faster pace, putting downwardreure on the interest rate-sensitive sectors. youinknow, cer the market is cognizant of what's ing on in trade, but yet the nasdaq hit another all-time high. a pretty goo rally. they don't seem to be too worried. >> no, they don't. i think that investors have developed a bit of a thicker skin to this trade rhetoric over the past couple months. i think the baseline expectation is a more diluted set of tariffs, but i think there's a bit of risk in technology, where if we do find ourself, that could be one of the sectors that comes under pressure. again not our base case, but something they could be cog any of. david, again, thank you for joining us tonight. >> thanks for having me. perhaps retailer michael's has one of the its worst days

since its ipo. that's where west begin tonight's markets. fo investors focused on the lack lusters sales andpo disting outlook. the stock dropped 14% to 18.86. a different story to etsy, the online craft marketplace, which raise the full-year forecast. it also increased transaction fees, angering some merchants, but the investors cheered. royal caribbean is making a bet on expedition and luxury cruising by taking a controlling stake in silver seas. the dock w3. up 5% to . elsewhere steel producer nucor says it seals earnings more than doubling from a year ago. the company cited higher prices and stronger profits. nucor shares rose more than 2.5%

to 68.53 today. pandora is partnering with t snapch give users the ability to share songs between plforms so pandora users will be able to send songs to ld snap-dayhat friends and in turns those friends will be able to listen directly o the pandora platform. it said obvious it made the deal to reach snap chat's massive audience. after the bell, adon'test reported stronger than expected earnings form the company also said it expects demand to remain strong in the second half of this years well, but shares still fell in extended sessions and end the regular day down more than 2%. kentucky's attorney general sued walgreen's over the opioid epidemic iteg a walgreens

played a dual role as a pharmacy chain and whole say drug distributor. filling massive opioid orders and failed toou report suspi orders to authorities. kentucky had the third highest overdose rate behind west virginia and new hampshire. health care ceos and policy makers are meeting to discussion some of the biggest breakthroughs, and overcoming the thorniest challenges. me tirrell is there for us tonight. >> reporter: through a few major tocs it piper jahvid ray how to contain costs and how technology is changing the industry. for eli lilly, aajor push has alzheimer's, but they suffered a setback this week for an eoperimental drugs, but the

says it remains committed to finding new medicine. >> it is disappointing for patients our hea goes out to all the parts partners. we have a phase 2 study going on, a combination wit a plaque-specific antibody, which will be as closes we can get tong elimina all amloid in the brain. we spoke where the rising costsen insulin and how every patient can access the medicine they need. >> the pricing has flat, where is that money going in the middle? it's going to negotiators but not to patients they have to make choices like that that the' shout have to make. >> reporter: technology wasling a topic. to the wayie we expe simple blood testing, is the ceo ofiest diagnostic is focused on. it's in the future more likely

youe c to expectsh the clipboards,ou see a kiosk, and by the way, you can engage through a smart app on your phone. >> many hope tha new technologies will drive advances in medicine and help ler its cost. for "nightly business report," i'm meg tirrell in minneapolis. college kids are mining bitcoin and doing it in their dorm rooms. chicago has picked elan musk's boring company to build a hi-speed connect network connecting downtown to o'hare.

it would carry -- and musk speaking alongside chicago's mayor says he's ready for this challenge. >> one of the hardest things to ith any new technology is not to demonstrate and show that it works, but to show people that can be indeed be useful. it's one of the hardest things in the world to make something e useful, the revenue exceeds the costs of the thing that was done. this is a deceer an an outstandingly different and unappreciated thing. that's what we intend to do here in chicago. the link is expected to cut travel time down to 12 minutes. wow. the s.e.c.'s point man on cryptocurrency says bitcoin is not a security the key t determining whether something is a security is the expectation of return by third party. until that definition, the s.e.c.ays bitcoin is not a security, because it's ra deceze many that sent bitcoin pricehehigher.

you think of bit coin mining, you probably do not thin d of collem rooms, but that's exactly where it's happen, in large part because electricitdr day has a our story. >> i had fans running, the window open. >> reporter: day one and patrick had a cryptocurrency mining operation up andrunning. >> it felt like passive income. when you're at school, it's still making money for you. >> reporter: but there was one bi>> problem. t was producing a ton of electricity, a ton of heat. >> reporter: how hot was it? >> it was unbearable. >> reporter: he rigged it together with a few dryer tubes temples penn state was footing . why shouldn't i have the ability to mine in my dorm room? >> reporter: he admits he had no idea what the policy was. we called the university to find out, but did not hear back. >> i was like, all right, i'm going to do this.

didn't ask any >>questions. eporter: some university are not making the rules very clear. >> it says you can't use institutional resources for personal gain or for ciyptocurrency. >> reporter: pat is wpi's chief information officer, and says newechnology is making it easier tominers.e u able to pinpoint it. >> we can show the ip address and work with them. >> reporter: she says most wiln shut d operation, if not they can lose access to the school's internet. >> the electricity consumption, on average, hear the cost to mine one is about $4,000 in electricity. >> reporter: that's not all. >> some have mall ware, which could install on your network. >> reporter: it's impossible to know how many miners exist, but

the numbers a growing, even as bitcoin gets harder to mine. it makes software to spot mining, and jt xleelt a study of schools across the u.s. >> we had 11 universities participate in our opt-in study. 100% of them had mining detection. >> reporter: 100% wh one kay every day. >> it's the wild west. you're in an environment that encouraging open behavior, and creativeng thin entrepreneurial behavior. >> reporter: it's not jus schools. it says some offices are secret havens for mining, tapping into company networks. >> they're basicallyng stea >> reporter: he now works for a main company, and set mining at school made h who he is today. >> i think students are going to engine that'e the fueling a lot of this growth in this space. >> reporter: he says he brought in about ten grand college career. that's the low tip for typical mine, but he kept the operation down to one rig to t

ke noise down for his roommate. before we go, here's one mo d look at the on wall street. the dow fell 25 points, the nasdaq was up 65, and the s&p rose six. what we had at the beginning of this week, it will be a busy week in the world of business. tomorrow, at&t/time warner closes possible and we get t china's tariffs announce. we'll have a ver busy night tomorrow night. >> you won't want to miss it. so please join us. that's does it for tonight. >> have a wonderful evening in the l antime. we we you to.

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