Transcripts For CNBC Closing Bell 20171101

The fed decision is behind us, at least this one. Now were counting down to the earnings in less than an hour, numbers from facebook, tesla, qualcomm,shake shack, and many, many more. Well tell you what to expect, break down those numbers as soon as theyre released. Here we go again its going to be a huge afternoon. The house tax bill was supposed to be released today now its expected tomorrow morning. We do have a strategist who says the best outcome for the market will be if tax reform does not get done at all. Hes doigoing to explain why shortly. We start with the dow, s p, and nasdaq hitting intraday highs earlier in the day the dow was up 140 at its peak, but all have pulled back from those highs. The dow no, nobody is in record territory lets get to our Closing Bell Exchange diane swan, robert frost at post nine, sitting next to keith bliss, and Rick Santelli checks in from the cme in chicago diane, im going to start with you. No surprise. I asked Rick Santelli yesterday if anybody was even thinking this fed metieting was relevanta all. You couldnt expect anything to come out of this, especially awaiting the president s decision tomorrow on the new fed chair. That is true. I think the one most important piece of the statement that i will reiterate that i havent seen in a long time is classifying the economy as solid. I know that seems like parsing the words, but using that word solid about the economy, not just about the labor market, its where the fed is going to divide Going Forward in terms of do we do rate hikes because Credit Conditions are still easy, or do we wait to see the whites of the eyes of inflation. Thats where the division is going to go Going Forward. The changes, whatever the announcement tomorrow, will affect that as well. Robert frost, the president spoke highly of janet yellen earlier today. Your comments seem to suggest you wouldnt like to see her stay on as fed chair why . I think that the fed has become way too political in the moves that they make we would like to get them back to a rulesbased moves the moves that the fed has made over the last few years has really boosted the economy thats been good for a lot of people, but our fear is long term thats going to cause a lot of inflation we would like to see the fed start to raise rates we know its going to happen in december like diane said, it is a Strong Economy, which is almost an oxymoron lately, but it really is strong here, strong overseas we think its time they make a move who would be that fed chair that would do what you are hoping to do we think taylor would be a great choice for that. Taylor, had they used the taylor rule back in the 80s, we wouldnt have had the inflation we had then. We wouldnt have had the recession in the late 80s i dont believe, had we used the taylor rule in the 2000s, we would have had the big run that led to the housing bubble burst because greenspan left Interest Rates low for so long. Diane, you want to respond to that yeah, its mind boggling. Janet yellen has the muscle memory shes incredibly qualified jay is a great guy too i know john taylor i think highly of him. To think the rules base would have been been in effect, you have to also believe the taylor rule, depending on which one you use, said negative 4. 75 interest during the height of the crisis to think youd always go by that rule is ridiculous ping its important to think more pragmatically. This is not a politicized fed. This is a fed that has i mean, janet yellen has stayed the course weve gone from being on crutches to running a marathon we have some stamina on the economy. Her legacy is going to be that she went from the crisis to unwinding crisisera policies. Janet yellen would not hesitate to raise rates if inflation picked up. We have lots of people rushing to goog tle right now looking up the taylor rule you can calculate it. Okay. Do it yourself i love that. Google it and you can go in and calculate your own taylor rule. Diane is all excited about that i like that. Rick, weve got some of the flattest yield curves weve had in a while maybe up to a decade ago as the fed continues to do what its doing right now, peeling off the Balance Sheet bit by bit what do you make of whats going on right now yeah, no, youre exactly right. Ten year is almost exactly november 2007. When it comes to tens to twos, theyre about a year behind. Its about nine years. Same for the twoyear note yield. Its all correlated together with the twos, the short end, and the fed. What i find fascinating here is there is this fascination with the yield curve. I think of late it isnt because traders or strategists or analysts are trying to find what its hinting at with regard to an economic signal i think its more the notion if you believe theres a 25 beep in december, two, possibly three next year, you start to do the math if we dont start to see the long end more aggressive, everybody is nervous about an inversion. The inversion, it isnt an economic signal. Its not a good thing. We live in a shortterm funded society. I think the asterisk everybody is missing is central bankers havent done what theyve done globally for basically a decade to let the yield curve invert. Thats what made mario draghi get aggressive, and should it happen here, they would just start buying securities again. I almost think its fun to watch, but i dont think the dark side is going to be a possibility. Its interesting to think through what this implies, keith. If were headed in that direction, its a negative signal for the economy, even as the numbers get better and better where does that leave the market if it does invert, of course, that will have a detrimental effect to the market i do agree with rick the yield curve is somewhat manipulated by the central banks. I highly doubt they would let the yield curve go inverted and send that signal potentially, whether its true or not, to the tra Trading Community and they start dumping out of the risk assets i think the more important point when it comes to the fed and yield curve is what is their Inflation Expectations and where will it go it is well known over the longterm on the average if inflation stays below 3 , equities grow at doubledigit gra gains. Inflation, some of the indicators, have been backsliding over the last month. I think those are the important points to listen to when the fed cops out with any statements or chairwoman or chairman in the future comes out and does press conferences. But right now when it comes to equities, we see again, i still look at this market and see room for it to continue to run. As long as the fed with inflati inflation behaving, it will run to the end of the year i want you to respond to what rick and diane were saying if you would a taylor type rule, what do you think would happen if that means the yield curve in other words, do you think the fed will back down if it looks like theyre headed in that direction . About three rate hikes to go for the 5 to catch up with the 30. We dont think the taylor rule would move rates up right away he would only be one of the voters we think it would take time. All that were looking for is moderate rates right now the economy is solid you look at consumer sentiment, and its at alltime highs Monetary Policy is easy. Interest rates are low gdp growth is growing. Very Strong Economy right now. We think that it would justify a little higher Interest Rate from where we are right now. And if thats the case, why dont you support janet yellen her plan is to raise rates a little in december, and you see the plan for next year well, you cannot take anything away from janet yellen. Shes done a very good job up until this point our only concern is we think that we need to get back to rules that the fed acts in right now they dont we think that the fed acts politically, and we also think that too many people have given credit to the fed over the last ten years. Let me tell you, janet yellen has never fracked a well shes never created an app thats entrepreneurism were behind entrepreneurs we think the fed should stay and do what they do. All right i wish i could go, but look at diane, the look on her face. Im sorry just dumb and dumber what about the look on my face im smiling give that man a trophy. I see both sides of the drama masks right there. Thank you, all see you later. By that logic, Mark Zuckerberg will be running the fed. Republican lawmakers were hoping to unveil their tax plan today, but that release has been delayed until tomorrow the big question is whats in the plan and what are these key holdups . I sat here yesterday and told you the tax plan was going to come out today now im standing here today, telling you its going to come out tomorrow so feel free to take anything i say with a big grain of salt heres what we think we know so far about whats in this bill. The Corporate Tax rate would go down to 20 immediately. It would not be phased in over time as had been previously floated. The top individual tax rate would stay at 39. 6 . The income level associated with that is still under negotiation. Also, the estate tax, that would be phased out over the course of several years. But every day that republicans delay in putting out this tax bill gives democrats more time to mount their opposition. Democratic leadership, along with the progressive group, not one penny, held a protest today outside the capitol over this tax bill representative richard neil told us this participate process is a missed opportunity there should be an opportunity here for bipartisan cooperation. There is full acknowledgment across the congress that the Current System is broken i think that the best lesson here would be for both parties to sit down and negotiate their way to creating a more efficient tax system for the American People representative neil sent a letter to house ways and means chairman kevin brady today asking him to push back the debate and vote on this bill thats scheduled for next week he said democrats havent had enough time to review the specifics of the bill, and guys, ironically that is the same complaint that republicans have. So everyone here wants to see the details. Back over to you all right hey, lets meet again here tomorrow at this time. See what happens hopefully i dont tell you the same thing well see thanks lets bring in michael with morgan stanley, dan clifton. Michael, youre worried that tax reform could ultimately derail this stock market rally. Why . What are you talking about well, what were looking at is what the sort of addup of the differents aspects of tax reform is going to be when we ultimately see the bill tomorrow and wether or not its going to provide a meaningful stimulus. The net revenue loss going to be equal or less than the budget resolution right now to the extent we think youre going to get, youre probably not looking at a meaningful fiscal stimulus on the back end. That doesnt nieceecessarily de Market Performance from here, but it probably supports duration buying and means theres more limited upsides where equities go from here. The alternative scenario is obviously that they try and work around the budget rules. They cant come to an agreement on some of these pay fors and actually go with a big, more deficit busting scenario in that scenario, we think that choice probably means failure has gone up and presents a more dramatic choice for markets. I think thats probably quite a ways away. The delay we had today, for example, probably suggests that theyre still trying to comply with this 1 in, 1 out. We need pay fors to replace rate cuts therefore, youre not looking at a meaningful stimulus. Dan, i think you disagree do you yeah, well, thank you for having me on tomorrow is going to be a very big day. I think its very much linked to the conversation you just had on Monetary Policy. Were going to use fiscal policy as a tool so Monetary Policy can begin to normalize and get rates higher and get the Banking System to be better. I would disagree on the terms of the size of this tax cut because this is being delayed for two reasons. One, to figure out how to get that tax rate down on corporate in immediately so corporations dont delay incentivings for investment and two, how to get more stimulus on the individual income tax side, particularly the low and moderate income households i think what youre going to see is a big widening of the deficit in the first two years and that subseting over the next ten years. But it really is designed to get about a 1 gdp fiscal stimulus in calendar year 2018 to get the economy humming before the midterm elections. But dan, what about michaels points about the socalled pay fors if theyre getting all this pushback on the 401 k caps, pushback on the state and local tax deductions, how are they going to pay for this thing . Theres two ways to do this, bill first, you can do what you just suggested. We think its about 4 trillion in tax cuts with 3 trillion of offsets for a net 1 trillion tax cut. If that becomes too harsh, that theres too much opposition to these proposals, then youll see them move to a more bushstyle tax cut from last decade where youre just dropping income and Corporate Tax rates. Youre still going to get that 1 gdp fiscal stimulus, but the way the budget was written, it gave them the option or two shots at the apple for that, two bites at the apple thats why i think the chances of them getting a tax cut done in First Quarter 2018 is over 50 . But notwithstanding tomorrow youre going to hear a lot about what we call the spinach of tax reform thats the offsets that are going to be needed to at least partially pay for the tax cuts they want to do. And dan, some of these measures were watching, you know and tell me your latest thing on this. You think state tax will not be repealed maybe they raise the threshold theyre looking at International Taxes that could hurt companies. Were watching cruise ships, the advertising deduction, mlps and rates. We havent even begun the reason were not hearing about them is they didnt want the lobbyists to know about it and come in. Thats why when this bill comes out, theres going to be a lot of surprises, particularly the tax on u. S. Multinationals intangible income overseas, particularly their intellectual property thats going to get a lot of attention from your viewers tomorrow and investors in the marketplace. And the democrats as well they havent seen any of this as well michael, when all is said and done, i can remember kevin brady coming on our show a few years ago saying were going to have an opportunity for major tax reform if we can get the majority in the house again. Theyve got it, but it doesnt sound like were going to get reform were just going to get cuts here with some pay fors to go with it. I agree with dan that i think we are going to get a piece of legislation across the finish line i think its going to take a little longer than the current house timeline on the tax cuts and mostly stimulus front loading the deficit, our major question is how do you comply with the budget rules while doing that when you know some of the methodologies used penalize deficits and we know historically the template has been spread out. I would agree that, for example, 1 trillion of deficit expansion over ten years seems to be whats permissible here. Seems like it might be touch to front load that when you consider the historical pattern and the scoring methodology. Thats not to say its impossible to get the type of gdp uplift dan is talking about, but i think its going to be more difficult given those confines, unless you start seeing them start to work around the budget rules, replacing the score, or Something Else that would challenge the vote count in the senate from the deficit hawks and the rules purrists i think this is going to get passed but probably not going to be the big, positive economic shock that were hearing about from some investors at least all right michael, dan, good to see you both thank you. Appreciate it. Thank you sticking with taxes, nbc nightly news anchor lesterholt sitting down just earlier today with apple ceo tim cook in a wideranging and exclusive interview. One key topping thic they did ca tax reform if the Corporate Tax rate is cut, would you expect apple to use those residuals to add more jobs yeah, i do. I believe that tax reform is sorely needed in this country. We dont focus on the individual side, but for corporations, we think we have a pretty deep perspective on this. The Biggest Issue with corporations in this country is that if you earn money outside the United States, which most Companies Increasingly will, the only way you can and its taxed in those countries, by the way. The only way that you can bring it into the u. S. And invest is if you pay 40 this is kind of a crazy thing to do so what do people do they dont bring it to the United States. Well, this isnt good for the u. S. Theres no tax receipts there. And its not good for investment in the u. S so this needs to be fixed. In my view, it should have been fixed years ago. But lets get it done now. And thats a big sticking point, of course, as we await more details on the tax bill tomorrow catch more of that exclusive interview tonight on nbcs nightly news with lester holt. Were closing in on one of the biggest hours of earnings this season, although we said that last thursday here we go again we have reports tonight from facebook, tesla, shake shack, gopro, i think yelp is in there somewhere. Much more of those we have an allstar team of reporters an analysts ready to break down those numbers still ahead here up next, President Trump gearing up to announce one of the biggest decisions of his young presidency tomorrow. Its not the tax plan. Its when hes expected to name the next fed chair well take a closer look at the front runner and what the fed decisioning mean f decision could mean for your money. Stay tuned win an uncertain world . K predictable income pgim sees alpha in real assets. Like agriculture to feed the world. And energy to fuel its growth. Real estate such as ecommerce warehouses. And private debt to finance transportation and infrastructure. Building blocks of strategies to pursue consistent returns over time from over 120 billion dollars in real assets. Partner with pgim. The Global Investment management businesses of prudential. President trump giving an updated Cabinet Meeting today on his search for the next fed chair. Listen ill be announcing tomorrow the new head of the Federal Reserve. Thatll take place sometime tomorrow afternoon youll be notified as to the time i think youll be extremely impressed by this person trump went on to say the current fed chair janet yellen is, quote, excellent, but declined to say if she was his pick, of course. So who will it be . Our senior economics reporter Steve Liesman has a look at the person considered the front runner for the job steve . Yeah, kelly, if all the kings sources and all the kings men and women are right, this is the eve before President Donald Trump announces tomorrow his pick for fed chair, and it will be, so they say, fed govern jerome, or jay, powell the 64yearold native of washington, d. C. Is a republican, appointed to the fed in 2012 by president obama at the fed, hes overseen some changes, intricate changes to markets in the wake of the financial crisis hes a former partner at the private equity firm where he amassed a small fortunate that would make him oneof the richest fed chairs ever. He has said hes in favor of rolling some of them back. Heres what he said about some other key Monetary Policy issues over the years while Monetary Policy can contribute to growth by supporting a durable expansion in a context of price stability, it cannot reliably effect the long run, sustainable level of growth inflation is a little below target its kind of a mystery you would have expected given how were getting tighter labor markets that youd have a little higher inflation i think what that gives us is the ability to be patient. We dont have a perspective on the right level of the dollar we sort of take the dollar as an kpoj nis element that comes into our forecast thats what we do. We dont talk about that its not our job we try to stick to our knitting, and thats the level of the dollar relative to chinese currency powell has generally broken with republican fed critics in calling the feds policies after the crisis a success that is he calls them a success. And a big difference between powell and fed chair janet yellen, powell is not an economist, and its unclear who the number two will be at the fed, kelly, and how much that matters for Monetary Policy. Could matter quite a bit. Guess it all depends on how this is going to unfold for now, steve, thank you. Well find out hopefully soon. Tomorrow afternoon. My bet will be during this hour. Well see. My bet is we dont find out tomorrow really . I just theres a lot going on tomorrow. Its tomorrow all right hes got to get that out before he heads to asia. Well see. Well see whether we get records on the close here. 35 minutes left on the trading session. Dow is darn close. The s p, thats also close were two points away from that. Nasdaq and russell are lower when we come back, just a hundred days away from the Winter Olympics in south korea ahead, well speak with the great lolo jones shes a summer olympic athlete, but shes one of the athletes to have competed in both winter and summer games get her expectations for the upcoming olympics, her sponsorships, and a lot more coming up. Anything worth pursuing hard work and a plan. At baird, we approach your Wealth Management strategy the same way to create a Financial Plan built to last from generation to generation. Well listen. Well talk. Well plan. Baird. Do you know its already 100 days until the winter Olympic Games get under way in south korea . Joining us to talk about this is threetime u. S. Track and field olympian lolo jones, whos of course now part of the u. S. Bobsled team as well i think youre one of only ten athletes that have ever competed in both the winter and summer olympics two summer Olympic Games and then the last winter games were in sochi. I was there competing. Welcome to the New York Stock Exchange this is amazing im an economics major this is a dream of mine. This is great. Good to have you here thank you so what are your expectations going into the bobsled you have to compete to get there first. Absolutely. Then were going to maybe send three teams is that the idea three women teams will compete there. Right now everyone is an olympic hopeful. Doesnt matter if you have past experience, past medals. Everyone has to requalify. So were 100 days out. Everybody is just gearing up for their seasons. Turns out being a sprinter or hu hurdler is good for the bobsled team we are the engine i bring the speed from track and field to boost it off out of the gate and get it down the track then i have a pilot who drives it at really great speeds. We have two number one ranked women pilots right now, which is insane so usa is rolling deep to korea. Lets go for the gold absolutely. Speaking of korea, with the brazil olympics, there were concerns of Health Concerns going down there a lot of athletes chose not to go because of that now we have geopolitical concerns are you worried about that at all . If this was my first Olympic Games, i would be. This is my fourth attempt. Every time theres something in russia we had there were worries about politics rio was zika every time theres always a concern for the athletes so we cant focus on that. We fous con ocus on our trainin. It all works out in the end. Sometimes the worries and concerns seem to be exploited a bit too much, and when we get there, its not a problem. I cant control politics i cant control the weather or other outcomes but i can control my training. Thats what i focus on every day. Going back to track and field, one of the big themes, problems lately has been how much theyve uncovered doping for people who had previously medaled at the games when you medaled, the endorsement money, the Career Opportunities are dramatically different than if you dont. Absolutely. How does that make you feel, the more that people keep coming forward and having to accept a medal that would have given them the silver, but they can never get that money or opportunity back just today they stripped a gold medal from a track and field competitor at the sochi olympics absolutely, and gave them a lifetime ban, which i think is great. It helps put that in place in a strict ban helping athletes to veer away from trying to cheat the system its a huge impact financially winning that medal can change your life. For my training partner, its made like, hes second to a lot of people. That money was hundreds of thousands of dollars for me, im fourth so im not even thinking about the olympics my closest, im literally i was this close away from a medal. If i do get a medal retroactively from a doping ban, for me i dont even think i will think about the money. I will think about that moment where i could have had the flag. I could have been on the podium. I could have heard the crowd cheering for me. Ill never get that back and theres no amount of money in the world that could replace that moment. I can imagine you still have nightmares about that ninth hurdle, dont you . I just got over it, but thank you for bringing it up youre welcome. Its only been about ten years. Still working on it. Still in counseling. Glad youre here. I know youre pumped and ready to go. Good luck. I hope you make it to south korea this time around thank you great lolo jones joining us. Time for a cnbc news update heres whats happening a the this hour, everyone. President Trump Holding his sixth Cabinet Meeting in the white house, saying hes eagerly anticipating his new tax cuts. He claims they will benefit the middle class and simplify filing returns. At the center of our plan are tax cuts for the working americans. We will reduce tax rates, increase the amount of income thats taxed at zero, and increase the child tax credit, which is very important to families it is winner take all as the Los Angeles Dodgers and Houston Astros square off in game seven tonight to decide the world series winner. This after l. A. Won game six 31 last night the dodgers have the biggest payroll in the game, and our jane wells asked the dodgers president and ceo if money can buy a championship we invest in our people we invest in our r d i think all that pays off. Weve won our Division Five years in a row i think our investment has been good its surely the product of smart investing. Youre up to date thats the news update this hour back downtown to you thank you, sue. Yeah, some people on twitter have already taken note of the color of my tie today. No, its not an accident i wore basic black. Im neutral. There you are smart. Thank you. See you later. So executives from facebook, twitter, and google have been spending a second day on capitol hill today, facing questions from the Senate Intelligence committee over social medias role in russian interference in last years president ial election kayla joins us from washington, where there have been some pretty good developments today yeah, it was a rancorous morning, bill, for executives from twitter, facebook, and google in front of the Senate Intelligence committee theyve moved over to the house side, where theyre in the middle of a hearing with the house intelligence committee, which is happening just behind me the discussion this afternoon hasmoved toward a more specifi subset of ads, accounts, and pages that these three companies have provided to the committee some of which has now been made public by the committee. I want to show you two sponsored pages that were linked to russian entities that were published this afternoon lawmakers have been saying for a long time that what the russians sought to do was widen the existing ideological chasms in this country take a look at just two pages for reference about how they did this one is called blacktivist. It was a page where these foreign entities would create events and rally people around civil rights ideas on the flipside, they had one called south united with confederate flags and the tag line the south will rise again. The general counsel of facebook told lawmakers the one thing theyre doing to thwart this is to take the money out of the equation we find that most false news is financially motivated, and were making efforts to disrupt the financial incentives that we think will make a big dent in it despite letting some of this foreign influence become widespread on their platforms for the last several years, these companies are trying to get credit for where they have made progress. Take for instance twitters acting general counsel talking about the scope of the threats they deal with on a daily basis. Over the last year, weve improved by almost 2x to challenge our accounts were challenging 4 million accounts every week to determine if theyre real. We take down and block 450,000 suspicious logins every day were making a concerted effort to stop this kind of activity. 450,000 suspicious logs in every single day, guys wovrt noting that the list of accounts that twitter has shut down in response to Committee Requests and in response to their trying to root out this activity as it has become publicly known, that list was 65 pages long its been described as a whackamole problem, and it has become clear from the testimony today that its an issue theyre still dealing with and they havent gotten to the bottom of. Back to you. Kayla, thank you. While facebook faces those questions in d. C. , the Company Stock hit another alltime high today and has its earnings coming after the bell. Julia boorstin joins us with a preview. Hey, kelly. The big question for facebook when it reports earnings shortly is whether it can continue its top and bottom line growth despite negative headlines about topics from mismeasurement to russian purchased ads and in the face of growing costs. Analysts project 17. 5 growth in earnings per share in the quarter on over 40 Revenue Growth facebook has beaten earnings expectations seven out of the last eight quarters and has beaten revenue estimates for nine straight quarters now, on average over the last eight quarters, facebook shares have risen over 3 the day following its Earnings Report. Well see how this quarters results stack up at the top of the hour back over to you. All right, julia. Well see you then what do you think . Lets debate whether investors should buy facebook right now. David trainor is our bull. Brian is our bull. Good to see you both david, for you its a valuation issue. I think its both valuation and the strength of the business i think its an unappreciated, strong business. Their returns on capital are faster than the accounting metrics would lead you to believe. I think they have one of the strongest cull dhtures. And theyve shown a startup like snap will get slapped down real fast if they try to compete with something theyre going to do internally i think its a really, really strong business. The valuation is way more reasonable for facebook than it is for amazon and netflix. Brian, you disagree, right . Well, yes, i disagree on whether or not its fairly valid. Im looking at the company, as i do 16 others i cover, on a cash flow base. The bigger point, whether or not thats the right number for a price target, is theres all these head winds coming at them in the future. The street is absolutely not considering. There are real limits to growth because the presence of facebook and google and Digital Advertising in general does not change the trajectory of total advertising. The two together are 30 of all advertising. Digital advertising is 40 of the total market it can keep growing but not by a lot more at some point it decelerates. Then the costs start coming into play, whether were talking about content costs. What were seeing from the congressional testimony, its pretty clear theres going to be some regulatory costs thatll come at them at some point as well and david, you have to admit, to this point, facebook has boasted about how effective their advertisements are, yet their general counsel yesterday, ironically, was put in an awkward position, having to say, you know, tell lawmakers, well, you know, these 126 million americans saw these ads, but chances are they didnt really absorb the information there hes arguing against the mantra that facebook has been telling us all these years i think facebook is more about what theyre going to do in the future than what theyve done in the past theyve shown the ability to innovate, do new things to make money, make money in places people hadnt thought about before i disagree respectfully with brian on the valuation the company has grown profits about 70 compounded annually since its ipo. The stock price implies 20 growth over eight years or 15 over 12 years. A lot of deceleration is already priced in. For a company thats shown the ability to innovate, to collect talent, retain talent in a way thats special, expectations for future growth could be low all right, gentlemen. We have to go. Were out of time. Thank you both well see how the numbers come out in just a few minutes. Meantime, amazon may be getting into the crypto Currency Business detail when is we come back. This is not a cloud. This is a tomato tracked from farm to table on a blockchain, helping keep shoppers safe. This is a financial Transaction Secure from hacks and threats others cant see. This is a skyscraper whose elevators use iot data and ai to help thousands get to work safely and efficiently. This is not the cloud you know. This is the ibm cloud. The ibm cloud is the cloud for business. Yours. Sometimes they just drop in. Always obvious. Cme group can help you navigate risks and capture opportunities. We enable you to reach Global Markets and drive forward with broader possibilities. Cme group how the world advances. All right. We have this news alert on amazon what in the world is going on here let me tell you according to online records, an amazon subsidiary has registered three crypto currency web domains. The records show they were registered yesterday theyre all linked to amazon technologies, which is a subsidiary that has been linked to past patent filings by the company in the past. This was first reported by Industry News site domain name wire, which also notes this may simply be a move by amazon to protect its brand. Back in 2013 amazon secured amazon bitcoin. Com, which just redirects back to the ecommerce sites main page weve reached out to amazon and will update you when we hear back also want to note last week at money 2020, i spoke to amazons vp of pay and asked if they were looking at accepts crypto currencies as a form of payment in the future. He said no because their customers simply have not asked for it worth noting that bitcoin has hit another record high today. Back over to you those urls were not that catchy well see what their intentions are. Im going to have to look up bills crypto currency and see if thats taken. Thank you. 15 minutes left. The dow up 16 points thats right at a record close there. S p is right below it. Nasdaq and russell are negative. Were minutes away from big earnings coming out after the bell today well preview the numbers and what you should watch out for amid this melee coming up. 5 years, hmm. You ever call your broker for help . Once, when volatility spiked. And . By the time they got me an answer, it was too late. Td ameritrades elite service team can handle your toughest questions right away with volatility, its all about your risk distribution. Good to know. Thanks, mike. We got your back kate. Does he do that all the time . Oh yeah, sometimes he pops out of the couch. Help from real traders. Only with td ameritrade. Ive got a nice long life ahead. Big plans. So when i found out medicare doesnt pay all my medical expenses, i got a Medicare Supplement insurance plan. [ male announcer ] if youre eligible for medicare, you may know it only covers about 80 of your part b medical expenses. The rest is up to you. Call now and find out about an aarp Medicare Supplement insurance plan, insured by unitedhealthcare insurance company. Like all standardized Medicare Supplement insurance plans, it could save you in outofpocket medical costs. Call now to request your free decision guide. Ive been with my doctor for 12 years. 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I think the biggest priority he has is making sure it does what hes laid out are his priorities in that piece of legislation thats providing tax relief for middle class, making it more fair, making it more simple. Those are the things that hes mostly focused on. If its called cut, cut, cut and it includes massive tax cuts like this president is proposing, i think wed be perfectly fine with that name. So the white house there not disputing or not putting down these reports that the president wants to call it the cut, cut, cut act, which to say the least, would be unorthodox by washington standards there are reports thats exactly what the president wants to do ahead of the fed chair announcement were expecting at the white house tomorrow, i also had the opportunity to ask her about that i asked if the fed chair nominee is going to be a man or woman. Sarah Huckabee Sanders declined to answer that i guess that means janet yellen is still officially a candidate. All the expectation is on joer ro Jerome Powell. She is a good sport sometimes, isnt she thank you, eamon. Cut, cut, cut fine we have a slew of earnings after the bell up next, key metricsou y should be watching when those numbers cross. Stay with us for your heart. Your joints. Or your digestion. So why wouldnt you take something for the most important part of you. Your brain. With an ingredient originally found in jellyfish, prevagen is now the number one selling brain Health Supplement in drug stores nationwide. Prevagen. The name to remember. Yes or no . Gin. Do you want the same tools and seamless experience across web and tablet . Do you want 4. 95 commissions for stocks, 0. 50 options contracts . 1. 50 futures contracts . What about a dedicated service team of trading specialists . Did you say yes . Good, then its time for power e trade. The platform, price and service that gives you the edge you need. Looks like we have a couple seconds left. Lets do some card twirling twirling cards e trade. The original place to invest online. Welcome back we have an earnings parade after the bell today our reporters are standing by with some metrics you should watch for. Phil, we begin with you. Kelly, its all about the model 3 and whats going on with production there that will drive the questions in the Earnings Call coming up at about 5 30 eastern also, the cash burn. How much money is the company burning through right now . As you take a look at shares of tesla, keep in mind its been under pressure because people are wondering will they have to bring down their delivery guidance numbers in about 15. Phil, thank you john fort, more about qualcomm or apple in this report . Exactly, bill eps is a question mark qualcomm consensus, 81 cents eps on 5. 8 billion in revenue. Thats in the middle of guidance raise. A penny above on eps normally qualcomm might be getting a boost from iphone x anticipations since preorders have been boosting component makers overhanging all qualcomm earnings, this continuing spat with apple over how much qualcomm should get in royalties. You have to look to qct, its chip business, which isnt really affected. Eps is the wild card here since the licensing business is hikghy profitable john, thank you well see you at the top of the hour as well in the meantime, as we head toward the close, the dow is up he oints. Weavthe closing countdown in just a moment. Stay tuned shes nationally recognized for her compassion and care. He spent decades fighting to give families a second chance. But to help others, they first had to protect themselves. I have afib. Even for a nurse, its complicated. And it puts me at higher risk of stroke. That would be devastating. I had to learn all i could to help protect myself. Once i got the facts, my doctor and i chose xarelto®. Xarelto®. 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About 2 1 2 minutes left in the trading session here were not going to hit a record unless we go up seven, eight poin points on the dow in the next couple minutes doesnt look likely, but were up 57 points as we begin the month of november, which is traditionally the beginning of a strong period for the end of year, but you wonder whether the previous two months, september and october, which were so strong, have stolen some of the thunder from the end of year typical traditional rally. Remains to be seen you know, today we were up 140 points at the open then things started to fade pretty quickly were up about 53 here at the close. The best performer today in the dow was intel. Boy, that thing has just found a new gear and continues higher. It was one of the strongest stocks in the Third Quarter in october and it is now starting off november very strong apple down today that is the weakest component in the dow for this first day of november tenyear note for the second day of november. Tenyear yield at this point is continuing to move lower we pointed out earlier the five year to the 30 year is the spread is about 83 basis points. The dollar index continues to creep ever higher. Were at around threemonth highs on the dxy well see if we can continue to move higher there. Oil moving off that eightmonth high we set just yesterday a slew of earnings and the decline line is actually flat on the day thats worrisome i dont like the fact the russell is down and the s p and dow are up thats a little unusual. Id keep an eye on that. Only a oneday trend the important thing is were seeing very good volume today in the winners. Technology etfs are continuing to get very large inflows today. Another group thats been doing better recently, oil and gas companies. Exploration production companies. These etfs are doing better as oil has been over 50 and the earnings have come in, Better Capital spending discipline is helping these companies. Bp has been up this week on its Earnings Report. Were clearly seeing people chase the winners right now. Gains but no records. Stay tuned lots of earnings coming your way on the second our of the closing bell with kelly evans andcompany see you tomorrow, kel. Thank you, bill. Welcome to the closing bell, everybody. Im kelly evans. Heres how were finishing up on wall street today. Looks like gains across the board with the exception of the russell 2000 actually, the nasdaq turning lower on the bell too. Dow up a quarter percent, 58 points s p up four points the nasdaq, as we mentioned, down about 0. 2, 6716 r by the way, the rally weve been seeing of late has been global in nature we had markets in canada, south korea, and germany also hitting alltime intraday highs. There you can see some of the performance today. We didnt quite carry on that momentum were about to get an earnings whirlwind. We have our reporters standing by to cover these bevy of results. Well see everybody in just a couple minutes thank you very much. Joining me on the panel today, micha michael santoli. Kevin oleary is chairman of o shares etfs. Great to have you here kevin, you were saying that this is a youre cautious. You got facebook you said they better blow it away or else tesla, youre expecting it to be a lot of risk here heres what i think about tesla. If it walks like a duck and talks like a duck, squawks like a duck, it must be a duck. Sounds like a car company to me. Production problems, market share issues at some point on one quarter, i dont know if its going to be this one, one day youre going to wake up and say, wait a minute, why am i paying an infinite p. E. For a car company . Its not like they dont have competition. When that happens, it is going to be a very painful day i dont know if its this quarter. Tesla has been through go back a couple years. They had a 50 correction in the stock before theyve had these concerns it reminds me of we work when everybody says this needs to be valued like a real estate company. Tesla is down 16 , 17 from its recent high. Definitely has run into some friction when it comes to these production problems. I think this is a market that is so rare to have a nonearnings based company that clearly the market sees it as something of its own animal when does gravity strike . Look, its a crowded short already. The bear case is very loud and out there. Basically, people think of it as a call option on some kind of grand future im not saying thats right, but thats how its being treated. We know there are bloggers who try to count the vehicle identification numbers to figure out what the production number is after it disappointed so big in their last quarter, thats where the concern about how much they can really do comes in you got a combination of that, plus, is that going to count on the more expensive cars youre talking about such low production numbers for a high market cap, its hard to justify that its more about the story and what else comes out of this. I think more than it is about a car company. They make batteries, right . Theyre trying to put the power wall and solar city. Its energy. I love the product. I dont love the stock its that simple i think the car is the bers of what it does at some point, if you think about what the multiples are for really longterm car companies, and theyre going to have to compete with gm and everybody else, toyota, kia, you name it when that pe gets applied to tesla, its a 40 , 50 , 60 correction thats all im saying. Facebook is ten times the market cap of tesla. A lot less drama about the results. The sblinteresting thing abo facebook is its cranked along its never had the concerns twitter has had. It makes money the oldfashioned way. Were talking about how much in profits this year for a company like facebook. Billions and billions. 15 to 20 billion pretax its a lot of money. Thats what youre saying i think the trend continues Digital Advertising moving on their platform i think the numbers will be great. If they werent great, it would be a big correction in the tech sector this is one of the pistons amazon, facebook what does facebook have to d with amazon, per se . When you start thinking about di digittization of an economy, these are the players doing it i was just over at plate sell bralting the acquisition of albertsons we were shooting that and talking about how much has changed in a matter of 12 months look at what happened to blue apron stock. Hit a new low. The whole world is looking at the digittization. Sara, what do you think if youre growing that fast, you deserve a premium multiple i think the question is if you dont put up a great quarter, if the growth looks like its slowing at all, what does that do i think the momentum is all in the favor of that digitization and certainly youre seeing ad dollars move there and seeing user growth. All those things point to higher prices all right well, the earnings are starting to cross lets start with qualcomm. John fort has those numbers. Revenue of 5. 91 billion nongap eps of 92 cents that eps number higher than the street had expected. The guide is to a range of 5. 5 billion to 6. 3 billion thats a midpoint for next quarter or the current quarter, i should say. Fiscal q1 of 5. 9 billion. The street might also be happy about that theres been a lot of nervousness over how qualcomms profits will shake out since apple stopped paying licensing fees in previous quarters, last quarter specifically qualcomm ceo said theyre just not going to count on revenue from apple or its suppliers when it comes to that at all. Apparently that guide and that expectation has led to the expectations and the consensus being pretty accurate as opposed to a lot of the noise that they were seeing. So right now we are again seeing 9. 1 billion on the top line. 92 cents nongap on the bottom, kelly. John, thank you qualcomm shares are up about 1. 5 anything to say there . No, i think its all going to what happens with apple is going to be what matters to qualcomm longer term we just dont know what the determination is yet facebook earnings are out lets get straight over to julia boorstin, whos covering those for us hey, kelly. Thats right we see facebook beating on both the top and bottom line. Facebook reporting total revenue of 10. 33 billion thats versus expectations of 9. 84 billion whats meaningful here about this revenue is that this shows a revenue acceleration facebook revenues were expected to slow to 40 theyre actually showing total revenue growing 47 year over year so thats notable to show that acceleration eps also looks like a significant beat the company reporting earnings per share of 1. 59 versus estimates of 1. 28 now, i want to really quickly hit on daus, daily active users. 1. 37 billion a hair stronger than expected. Thats a 16 increase. Monthly active users were 2. 07 billion as of the end of september. Thats also a 16 increase mobile advertising revenue represented 88 of ad revenue. But heres the key thing Mark Zuckerberg saying our community continues to grow and our business is doing well, but none of that matters if our services are used in ways that dont bring people closer together he goes on to say, were serious about preventing abuse on our platforms. Were investing so much in security that it will impact our profitability. Protecting our community is more important than maximizing our profits. So you see this is a company that has beat on the top and bottom line. The stock is only up less than 2 after hours perhaps reflecting these comments here about how investing and protecting the community will exaimpact profitability. We surely expect to hear more objeon the Earnings Call at 5 00 p. M. Eastern. Very interesting to see facebook outperform but also give that warning. Julia, thank you. The shares up a little less than 2 an alltime high. The market was poxed fsitioned a beat you were seeing whispers in the high 130s per share. Came in well above 150 i do think that theres going to be a perception tug of war here about what zuckerberg said, about whether its really going to impact profitability, or if were talking about gestures and these measures around the edges that maybe really restrain the profitability of this network in a meaningful way for all the focus on the advertising figures at facebook, heres what they just reported in the quarter a huge beat relative to expectations advertising revenue over 10 billion versus 9. 8 billion estimate call it 50 growth year over year their advertising revenues were 50 year over year and mobile made up 88 of the total and theyre taking that away from all the other kinds of advertising weve seen thats why youve got these sectors like older media struggling when Something Like facebook can grow this fast. Theyre trying to reach the most amount of people that they can i think that says more about noise, about whether or not thats going to cost i think it would have been fun to separate out russian advertising just to see what that was zuckerbergs statement is really talking down expectations. Its brilliant and blaming really the politicians for making him do that i bet you hiring a few thousand people to weed out fake news and russians and whoever else is playing with the game but that is a big number. Their total head count is 17,000 bottom line is its nothing compared to earnings its a lot of money, but its not that big in terms of talking about how fast theyre growing revenue. Is it possible this is the peak ad revenue is up 50 year over year total revenue up 40 i think it keeps going. Theres no reason. This platform is so effective, so measurable, so useful to small and Large Businesses alike. And if we get tax reform, there will be more capital available this thing could keep going for another couple years i love the way he pulls down expectations its brilliant always blame the politicians thats what i do. Gopro earnings are out lets get those quickly with josh lipton. Kelly, go pro reporting eps at 15 cents. Thats versus expectations of 2 cents. Revenue, 330 million versus an expectation of 314 million. This q4 guide, kelly, is weaker than expected. Eps guidance here of about 42 cents versus an expectation of 57 cents the revenue guide is for about 470 million. Analysts have been looking for 521 million. That 2017 guidance looks a touch weak as well theyre calling for an eps loss of two cents to a gain of eight cents. Analysts had been expecting a nickel revenue, looking for about 1. 32 billion. Analysts had modeled 1. 35 billion. Call starts at 5 00 p. M. Eastern. And the shares are down 11 josh, thank you. Weve talked a lot about gopro i guess the question comes down to has it reset enough and what are the Strategic Options . Theyve shown some financial discipline theyve tried to manage with the lower expectations here. The Fourth Quarter guidance is really all that matters. Is still is a seasonal business. Exactly, the holiday quarter. Its not all, but its the big, decisive one. Stock has been struggling to stay above the lows in the mid, single digits. Seems as if there were not high expectations, but again, another one of these crowded stores. Kevin, what would you say the company should do right now . Its simply acting like a Consumer Electronics company, a very niche one what never developed and what the big dream was and why so many people bought it in stratospheric doubledigit numbers is this software ecosphere idea, becoming a Media Company and engaging in everyones content and monetizing it. Thats long gone as an idea. Now youre trading off the ups and downs of Holiday Season on a gadget its going to be single digit until the cows come home lets get fire eye in here. Seema mody has the results from that company hey, kelly. Security firm fire eye reporting Third Quarter earnings its a loss of 4 cents, which is better than expected on its bottom line. Top line numbers also look better than expected at 189. 6 million analysts were looking for 186. 4 million. Product subscription billings increased 28 sequentially from Second Quarter of 2017 the stock is down more than 11 . Well get on the Conference Call and see what exactly management has to say back to you. Thank you, seema. This has been another surprisingly challenging space if your fwied is lower for the next quarter, it doesnt matter what you did for this quarter. I think for a lot of these companies, the people were expecting that growth. If they dont get it fast enough, theyre going to say, ill put my money some place where it is growing. The really big guys are the haves. A lot of little guys are the have notes people get exhausted and say why should i stick with this if there are other places to go lets see how yelp did. Hi, kelly those shares are sliding right now. Double digits down 13 because of weak guidance in Fourth Quarter revenue. Lets start with the top line. The company beat on revenue 222 million versus 221 million, which analysts were expecting. On the bottom line, a big beat analysts looking for a loss of 2 cents. The Company Reports a beat of 9 cents. The q4 guidance on revenue, that seems to be the problem the Company Reported 211 to 216 million versus analyst expectations of 232. 5 million. Another few metrics thats important to look at, ad revenue. Thats where the Company Makes the bulk of its money. That was a slight beat paid advertising accounts is another important metric slight beat there. Transaction revenue, the company has made that a focus. That was a slight miss 18. 5 million versus 18. 8 million. Again, what cements to seems to the shares is that miss on Fourth Quarter revenue guidance. Well hear more color on the call and also expect to hear more on that deal with grubhub that they announced last quarter. A lot of analysts expecting that will help improve its profitability. Thank you y yelp down 11 . This is what you were just saying were left with what feels like a mature industry. You have the big four or five or six in this case, as it may be then you have everybody else trying to stay competitive its like everybody wanted to be the biggest Search Engine facebook has that space. Once you own that space, the guys who are trying to come behind cant get back. Worth mentioning, yelp stock up 70 off the lows. They do have a franchise i find them quite useful. If you have a guide that says zero sequential momentum, thats going to give you pause. What is the ultimate outcome of a yelp . Is it going to be around in five years . Or is it just yahoo in a different Halloween Costume . Does it become more valuable . I say less. I say it becomes an addon to somebody whos got a multibillion dollar market cap that says i could use that but how does that become a platform where you can invest and you get a decent return . Thats why you get such volatility on these Earnings Reports. Is there usefulness in what yelp offers . Yes, but why is it public its just a feature. Why is it a Public Company im not against the management or anything. Why is it public why isnt it either making money privately, waiting for someone to acquire it and consolidate it thats why you get punished. Any time you lose 12 in one trade, thats very painful and perhaps theyre thinking some of these same things right now. Shake shack earnings are out lets get over to kate rodgers for those numbers. Stock not moving too much, but this is a fairly decent report for eps, 2cent beat, reporting 17 cents adjusted versus estimates for 15 cents 96. 4 million just about in line with 94. 5 million. Comp store sales declined less than expected for this quarter they were down 1. 6 . Those same shack sales as they call them, the street was looking for a fall of 2. 6 in the quarter. They also say they hoped nine new shacks theyre going to open between 24 and 26 new domestic owned shacks in 2017. Eight net new licensed shacks for the year also saying next year will be their biggest yet with between 32 and 35 new Domestic Company owned shacks, 16 to 18 net new licensed shacks. They also had a tiny raise in guidance for their same shack sales for next quarter, saying theyre going to fall between 1. 5 to 2 thats versus the initial estimates of a decline between 2 and 3 . Once again, the stock oh, actually now higher by just about 2 kate, how many did you say theyre opening next year . 30 something thats right. Its going to be their biggest year yet they said theyll open between 32 and 35 new Domestic Company owned shakes, 16 to 18 net new licensed shacks. All right thats going to be interesting the shares are up 2 on that thank you. We should note shake shacks ceo will be on monday. Shares up more than 3 i guess the reason i find that interesting is theres some concern about cannibalization with shake shack so theyre slightly increasing openings this year in a big way increasing openings this year. And shares are higher. They still have new markets to go into theyre being methodical its one of these stocks thats slowly trying to grow the footprint of the store base into the valuation. The valuation out of the gate was wild for the scale of the company itself we see the tesla number has just crossed were not quite all right, good phil is ready. Thank you very much. Joining us by phone as he starts to pore through these results. Hi, kelly i am here. Ive got the numbers for tesla a wider than expected loss tesla losing 2. 92 a share the estimate was for if a loss of 2. 29 a share revenue slightly better than expected not a big surprise here since we get the delivery numbers from them revenue coming in at 2. 98 billion. The estimate was for revenue of 2. 94 billion were just starting to pore through the investor letter. Thats where you find the little nuggets that are most interesting. When it comes to model 3, they say they plan to be at a production rate of 5,000 model 3 vehicles per week by the end of the First Quarter. Theyve already set a target of 10,000 per week by the end of some point in 2018 were going to go back, look at the letter, and give you more. Tesla, a wider than expected loss of 2. 92 a share. Back to you. All right you were on the phone. We see you shares are down 3 thank you, phil. 5,000 per week by the end of the First Quarter. This is a Company Famous for saying, yeah, but were going to do better, were going to get there. Going back to what they did in the Third Quarter, they delivered 220 model 3s kevin, what do you think if you own these shares, you have to be sighing relief. Theyre losing more money than they thought they were going to lose production is cut in half. You only lost a few bucks off the stock. Although it was down about 3 today. Were talking a drop of 6 im talking about the stock trading at 50 one day this is a wonderful, wonderful you have pushed this. First it was down 50 . Now its down to 50 bucks. I think about 5,000 units in the Automotive Market of the world, it is such a nothing burger such a fractional zero in market share. Yet, its got this amazing support. I say great. By the way, hes the biggest entrepreneur i can think of. Whatever he wants to do. I applaud him for that but this in the standalone business as a car company, if you just landed from mars and looking at opportunities to invest in automotive, you would scratch your martian head and say i think i better fly back home they dont trade on this planet. Elon will get you back and forth to mars. It makes no sense sara, what are you thinking first of all, to get to 5,000 and then to 10,000 within the time frame theyre talking about seems like an awfully ambitious move on the production side alone. I think, again, it is not being traded as if it was a production company. Its being traded as if it had all of these things together the batteries, the ecosystem, this whole so its giving you this idea. Whether or not that comes to fruition in a Financial Sense is the harder thing to decide because i think that this is really from a valuation standpoint a challenge but thats not people are looking at this and giving it a hall pass on a lot of things, including how much money they lose michael thats all true although, youve had a little sobering of the outlook and the way the stock is traded. Trying to weigh both sides of it its been trading on this total Addressable Market and how much tesla can get of that market down the road. I think at every stage its been a show me. Well see if they can actually get to this 5,000 a week pretty trivial the shares are down nearly 4 much more in just a moment kraft heinz has its earnings out. Lets get seema with those numbers. A penny beat for kraft heinz on its bottom line at 83 cents adjusted versus the estimate of 82 cents a miss on revenue, which came in at 6. 31 billion. Analys analysts were looking for 6. 33 billion. In the Third Quarter, United States net sales were 4. 4 billion. Thats down 0. 4 versus the year ago period kraft heinz ceo says theres no question that the retail environment particularly in the United States will remain both dynamic and challenging. However, the investments weve been making in our brands he goes on to talk about thats where the growth is. You can see the stock is down more than 2 here. Back to you. Some concern the blue may be coming off the cost cutting rose there. Kraft heinz down 2. 5 . Cheesecake factory those results are out. The stock is falling on this news a miss across the board. The company reporting earnings er share of 56 cents versus estimates of 56 cents. Revenue of 550 million versus estimates of 566 million Comp Store Sales fell more than expected, down 2. 3 in the quarter. This is versus estimates of 2 this is due to the impact of hurricanes harvey and irma that took off a 0. 8 decline as far as their Comp Store Sales were concerned ceo did say excludeing the weather impact, their sales and earnings were in line. As you can see, the stock is down more than 3 . Back over to you kate, thank you sara, kevin, before we go, what are you going to be listening for . We get the Conference Calls for facebook, tesla, and others as we head into next hour what are you listening for i think overall, youre looking for whats Going Forward. Again, people are looking for whats going to happen next year because youre getting to that end of the year period where people will Start Talking about 18 thats going to be important because the market has done well in earnings this year. The question is can that moment momentum continue. Im interested in any clues about the regulatory environment, what the management thinks about what the battle will be between regulators trying to turn a facebook into a Media Company. Theyre certainly taking away advertising companies. So why arent they media companies. The big debate for the next couple quarters. I think to the extent that doesnt afblfect earnings becau i look at the digitization that looks really good unless the government says, hold on lets change the rules guys, thank you very, very much busy hour to kick things off more when we come right back facebook shares are higher after reporting those better than expected resultings. Were going to get more reaction to that and find out whether the stock can keep rallying. Plus, tesla shares are dropping after its report ahead, if problems with the model 3 production will keep weighing on the stock. Back in two. honking beeping were on to you, diabetes. Times up, insufficient prenatal care. And administrative paperwork, your days of drowning people are numbered. Same goes for you, budget overruns. And rising costs, wipe that smile off your face. Were coming for you too. At optum, were partnering across the Health System to tackle its biggest challenges. Welcome back some big movers after reporting the results. You can see fire eye down 11 after hours. Gopros losses moderated, only the yelp down double digits. Meantime, tesla down 4 . Qualcomm barely lower there. Shake shack up 6 now. Thats a big increase after it said its going to open more stores this year and next year than originally planned. Kraft heinz down 2. 5 . Yelp has moderated lets get more on teslas cash burn the shares are moving lower. Back to phil loebeau fo le. Keep in mind that they also had about 1. 8 beiillion in debt issuance in terms of the cash position, thats going to get a fair amount of attention from the analysts during the call tesla goes on to say in its investor note that it believes its well capitalized to handle the new model 3 production schedule for 5,000 model 3s per week by the end of the First Quarter. We have yet to see what the production plan is for the Fourth Quarter remember initially, the plan was that they were going to be making 500 per week by the end of the Fourth Quarter. That obviously is going to be one of the questions during the Conference Call which comes up with elon musk in about an hour or so. Kelly, back to you all right phil, thank you. Weve got some news on under armour here. Lets get to Courtney Reagan this is reportedly two more executives leaving the company according to dow jones, which is citing an internal memo circulated among Senior Executives on tuesday night. According to dow jones, under armour is losing its chief marketing officer and head of womens. Both will leave at the end of this month the memos that dow jones is citing says they have mutually decided to part ways really doesnt give us much more we know under armour has been under pressure, both the share price and the sales as they face increasing k increasing competition we also have information from l. Brands the stock is moving on this. L. Brand shares up about 8 in the after hours. The company reporting october comps up 2 . Theyre also increasing their guidance for the quarter they now expect to land in the higher end of the previous guidance, 25 to 30 cents, compared to analyst estimates. Wow thats a big pop up 8. 5 . Courtney, thank you. Lets go back and check on facebook, who just reported earnings a little while ago. Joining us for more reaction, ben dunbar, a facebook shareholder. James chuckmuck, just upgraded the stock last week. Welcome to everybody chuck, lets start with you. Shares are up about 1 what are you focused on here what you wanted to see was the revenue coming ahead of expectations and a flatter slope on margin degradation. I think thats what youre seeing here. I think maybe the comment from zuckerberg spooked people about maximizing security over profits, which is the right thing to do. At the same time, when you think about the nominal dollar value of the investments, call it 100 million versus 55 billion revenue next year, its a drop in the bucket. We had some harsh comments on capitol hill against facebook and others today Diane Feinstein saying to the companies, you bear this responsibility she was saying how she had gone home with disappointment after yesterday, saying the companies dont get it were talking about a cataclysmic change, talking about the beginning of cyber warfare. You have created these platforms. Theyre being misused, and you have to be the ones doing something about it or we will, she said how concerned are you about that the numbers are great although this may be a little negative press for technology as a whole, its all relatively new, and its something facebook is getting out in front of its something theyre taking van of, spending the money to do its going to be a drop in the bucket i couldnt agree more. Ultimately its not going to have a big effect on profits or revenues and it also reinforces how good of a platform facebook is. Were still going to see a lot of small businesses, a lot of movement from television, advertising, on to facebooks platform ali, you have a whole other company. How big are your concerns . Not that big, actually. We actually think that zuckerberg, in our opinion, is actually pursuing a good strategy because in the long run, it will have a pretty good return on those types of investments in terms of security, in terms of maintaining data, and so forth so we think overall its pretty positive the amazing Revenue Growth we keep seeing unfortunately is proving us wrong, but thats certainly good for the investors. Top line still growing at 50 . Its just amazing. An Amazing Company what i think people miss is although there are so many users on facebook, theres still so many small businesses, still so much money going into advertising not on facebook. So thats where were seeing that most likely increase in revenues, from that movement of ad dollars being spent in other places and better allocated to facebook ultimately, people are seeing results with their businesses. Were seeing it personally in our own business and in our clients businesses. Just in terms of those drivers, i want to get to the factors that will drive that, which would be pricing and the ad mode. Obviously those are the two components whats the trajectory look like . I think whats interesting on the pricing side is that what were hearing from agencies and advertisers is that roi thresholds are coming down so theyre willing to pay more and i think that theres a big dynamic thats happening in the broader Advertising Market weve talked about this before with the cpg brands, more toward private label, the Amazon Effect what will happen with that is the fact there will be increasing desire for performancebased ads. You have a duopoly you cant stop this until the government wants to step in. Theres no indication they want to step in any time soon all right well see. Even after todays hearing, if thats the case. From a breakup standpoint appreciate very much, guys. Shares are still up a little less than 2 some breaking news on the fed chair decision sue herrera, what now . Dow yoenz is reporting that the white house has notified Federal Reserve governor Jerome Powell that the president does intend to nominate him as the next chairman of the central bank thats according to a person familiar with the matter, according to dow jones apparently the president talked to mr. Powell on tuesday, according to another source by dow jones. The president had settled on mr. Powell by saturday however, the source to dow jones cautions that the president could change his mind. The president apparently plans to formally announce the decision thursday before he leaves for his trip to asia, which will occur on friday so according to dow jones, the white house has notified mr. Powell that he will be the next head of the u. S. Central bank. Back to you. Sue, thank you. Michael, every hour seems to bring further evidence that this is definitely happening. I think the market has certainly made its peace with this seems like the least kind of disruptive choice in terms of the path of pop si so i do think, you know, the market is going to kind of check off this box and say we can live with this. All right well see tomorrow when were supposed to get this announcement meantime, can tesla turn things around after its latest Earnings Report . Shares are still dropping after they release their latest results. Plus, shake shack shares popping after its earnings find out if investors should take a bite out of this stock coming up. Today, the new new york is ready for takeoff. Were invested in creating the worlds first stateoftheart drone testing facility in Central New York and the mohawk valley, which marks the start of our nations first 50mile unmanned flight corridor. And allows us to attract the worlds top drone talent. All across new york state, were building the new new york. To grow your business with us in new york state, visit esd. Ny. 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Call for a free quote today. Liberty stands with you™ Liberty Mutual insurance. At ally, were doing Digital Financial services right. But if thats not enough, we have more than 8,000 allys looking out for one thing, you. Call in the next ten minutes to save on. And if thats not enough, well look after your every dollar. Put down the phone. And if thats not enough, well look after your every cent. Grab your wallet. Access denied. And if thats still not enough to help you save. Ooo i need these well just bring out the snowplow. You dont need those well do anything, seriously anything to help our customers. Thanks. Ally. Do it right. John fort is just off the phone with qualcomm ceo. John, what did he have to say . Kelly, he called it a good, solid beat and strong execution from the product business that sets them up well for fiscal 18. He also mentioned strength, product strength across geographies, and price tiers, including china. This is interesting for investors in technology writ large. He said this shows the strength of domestic chinese manufacturers of smartphones who are winning not just in china but also in india, throughout southeast asia, and average selling prices for these oems are rising theyre moving into the premium price tier, able to raise prices theyre not just dealing at the cheap end. That means theyre buying higher end processors also telling me theres no new news on the licensing front. Qualcomm is happy there and points out theis is really just fights with two oems, one of them apple theyre pretty big 5g is still a calendar 2019 event, but he said the whole world is going to participate so they expect revenue there in the beginning of calendar 2019 all right john, thank you. Qualcomm shares down just fractionally at this hour. Well keep an eye on those, along with tesla, which is dropping on the back of its Earnings Report. We have a debaten et owhher this is a buying opportunity when we come back in two welcome back shares of tesla down 4 after dropping 3 during the market hours today. This after reporting its earnings, which showed a wider loss per share than expected the company did beat on revenue. Lets get more with jamie albertine. Stock is moving your way what jumps out to you in particular here . Well, pretty much some of the headlines that we were expecting. We already knew that theyd had a disappointing result on the model 3. What was a little worse was the model s than the x those volumes were less than expected and the margins, the Gross Margins in particular were disappointing. But you know, the year started off with a lot of good news flow the company was steaming ahead, more recently the last couple weeks, weve seen a rollback of some of the news flow. I dont think its derailed. I just think its expensive. James, what about looking toward the model 3 schedule now being pushed out theyre saying a 5,000 unit pace by the end of the First Quarter. In terms of the 10,000 per week goal, theyd have to reevaluate. Theres quite a push and nothing in the bag in terms of them being able to do this. Yeah, and thanks for having me, by the way they have a credibility problem. Theyve had a credibility problem before, but they have one now. They need to, you know, hold to some form of guidance on the model 3 ramp one cue from our conversations is about what people expected based on being delayed to only 222 units through the Third Quarter. I think theyre managing expectations theyre okay but they have to hit that. Comment on the margins quickly. I think Gross Margins were a little more frankly, they were above consensus slightly. I think many people knew that with the model 3 being lower than expected, costs are still very, very high. Margins were going to come under some pressure. I dont think thats a surpris here but clearly the one cue they have to hit something very close to 5,000 units per week or this is going to reset lower. It came up earlier, should this company be valued like a traditional car company . This definitely is not a traditional car company. Never has been its really changed the business the fact that so Many Companies plan to have their electric vehicles by 2020 or 2021 are moving towards Autonomous Vehicles i directly credit this largely to elon musk its a technology company. It does deserve a premium to general no tomotors or ford i think it has an excessive peop premium for the risk people are taking shares down 4. 5 after hours. Thank you both youre welcome. Meantime, facebook started this weeks tech earnings wave were just minutes away from the social media giants Conference Call well look at what to expect on that coming up and shake shack rallying big after its Earnings Report. Well dig into the numbers and look at why next it can detect a threat using ai, and respond 60 times faster. It lets you know where your data lives, down to the very server. It keeps your insights from prying eyes, so theyre used by no one else but you. It. Is. The cloud. The ibm cloud. The cloud thats designed for your data. Ai ready. Secure to the core. The ibm cloud is the cloud for business. Yours. We cut the price of trades to give investors even more value. And at 4. 95, you can trade with a clear advantage. Fidelity, where smarter investors will always be. And at 4. 95, you can trade with a clear advantage. A Silicon Valley server farm. The vault to mans greatest wonders. Selfies, cat videos and winking emojis. Speaking of tech wonders, with the geico app you can get roadside assistance, digital id cards. Or even file a claim. Do that. Yeah, yeah that should work. Its not happening. Just try again. Uh, i think i found your problem. Thanks. Hmm. The awardwinning geico app. Download it today. Looking from a fresh perspective can make all the difference. It can provide what we call an unlock a realization that often reveals a better path forward. At wells fargo, its our expertise in finding this kind of insight that has lead us to become one of the largest investment and Wealth Management firms in the country. Discover how we can help find your unlock. Welcome back shares of shake shack up 5 after its latest5 after its latest Earnings Report john blaine from zack joins us now. John, what do you think is going on here . Kelly, this stock has been trading for 30 to 40 a share. We entered this Earnings Report at 38 a share, well pop up to 40 the earnings beat two cents on a 15 cent consensus which is standard for this stock and this company. Going back to the ipo 2 1 2 years ago, they beat every quarter, kelly i would not be a buyer on this stock. This is a swing trade to 40 and were seeing that pop to 40 right now. John, they did have some margin pressure at the store level. They talked about labor costs being up, things like that is the actual single store profitability worthy of the kind of premium that the Company Trades for right now the premium, michael, on a forward look, 59 cents a share is what theyre looking for in 2018, thats a 63 times earning. So im not a buyer of stock at 63 times earnings. As far as the growth of the company, theyre looking at about 14 stores, 4 million in sales per store, about 56 million per year they do about 20 Revenue Growth on that. Thats not what youre talking about, which is that margin pressure i dont know you have to wonder if these hiking wages this time in the cycle is going to start to hurt Companies Like this. You have to think, youre no longer term other than this pop to the swing at 40, im a seller. Mike, you were looking at those labor costs, including Cheesecake Factory its true across restaurants in particular, an acute pain point that they have and theres no way out of it its a good sign for the economy, its a conundrum for the companies, are they in an environment where they can pass it along not yet cheesecakes top line was down slightly and labor costs up 3 john, they have these ordering kiosks, shake shack is trying to roll them out and keep that number down this is a company thats got lines out the door at a lot of their new stores, theyre critically understaffed to begin with you have to say to yourself, if i were them with twice the sales of an mcdonalds, i would probably pay up and lose some margin here, because of the growth since the stock and the company are really about growth, i think you can probably do an amazon here, get away with a lower margin, bring those workers in and get those lines down and see if they can get the revenue and the quality up thanks for joining us shake shack still up 5 after that Earnings Report john blake from Zacks Investment Research still ahead, shares of symantec getting slammed today after hours, down about 8 well bring you the tas deilof that report after the break. Welcome back lets send it over to seema mody for a look at semantic reporter symantec missed on its bottom line. Its forecasting weak q3 guidance the stock is falling in afterhours trading, down by as much as 8 back to you. Seema, appreciate that. Mike, i was just doublechecked, i believe they own life lock now. This came up big time after equifax happened, people said i need to sign up there. Interesting to see the shares drop 8 . It is i dont know if its tied to pc volumes or anything like that. Obviously not a great one, hasnt been that wonderful growth which is shocking given what were seeing on the breach front. What didnasts alywant to hear on the Conference Calls for facebook and qualcomm . Thats next. Starting with advanced manufacturing that brings big ideas to life. And cuttingedge Transportation Development to connect those ideas to the world. Along with urban redevelopment projects worthy of the worlds top talent. All across new york state, were building the new new york. 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They might just get what they want out of life, and maybe even more. Tons of earnings coming our way. Three of the biggies, facebook, tesla, and qualcomm, all with Conference Calls about to begin. Qualcomm is higher, tesla down about 4 what do you think investors will be listening for zuckerberg has set the tone with his comment in the prepared statement saying, look, were serious about this, its going to hurt profitability. I dont want to read too much into the fact that the stock is flatish, at an alltime high after a tremendous run its had. You have to wonder if the company feels after showing this amazing, gaudy, dominant growth in revenue and profits, it starts to make it harder for them politically i agree this has come out this morning, you wonder how many senators would have said, your ad revenue is growing 50 , you cant tell us is it a fair criticism that they cannot ever completely police the content . You do think its fair, it has to be what ad hoc, you have to make your best efforts continually as an ongoing twehig tweak your algorithms. Gopro down 12 , shake shack coming back a bit. Short sellers are going paid. Thats a good point too michael, thank you very much that does it for closing bell. Fast money starts right now. Fast money starts right now. Live from the Nasdaq Market site overlooking new york citys times square im melissa lee. Tonight on fast, nothing can stop this rally. The market surging to record highs despite a delayed tax reform bill and uncertainty around the future of the fed President Trump said he will pick Jerome Powell Steve Liesman is work the phones now and will join us with the latest facebook jumping to all time highs while tesla sinks after its earnings