Transcripts For CNBC Closing Bell 20171103

Broadcoms higher by 4 . Meantime the gop tax reform bill has been revealed former fdic chair sheila bair will join us to talk about the impact that new plan could have on the Financial Sector. Meantime the housing recovery is, its recovering a bit today after getting hit hard on the news of the mortgage Interest Deduction cap that the new tax plan proposes. We got someone, though, who says this is a major buying opportunity for that sector. And he will explain why coming. We start today with apple. That stock hitting all time highs as the iphone X Hits Stores today josh lipton is at an apple store in, where else, palo alto. With the latest. Josh reporter well, bill, i can tell you the first guy on line here at this store right behind me actually arrived on tuesday night. I also ran to another, someone i met with the iphone 8 launched, he was back here today he was going to give his 8, he told me, to his sister hes going to pick up the iphone x. We asked fans online why they were excited about the x heres what they had to say. Probably the screen the oled screen. Ive been waiting for that for a while. I think the screen, of course. Big screen. Big one reporter now, we also asked some fans about the price point of the iphone x. Heres what they told us its pretty high, but i think its worth it for a new iphone reporter bulls are betting that the iphone x, of course, is going to be a hit. Its going to power this big upgrade cycle in fiscal 18. That has helped drive this stock up 50 so far this year. That means apple is on track for its best yearly performance now since 2010 stock trading higher in todays trade, too, that was on that december guidance with apple ceo tim cook telling me in an interview about that guidance now there will still be a wait, cook telling me, he was referring to the x, but were working as hard as we can to get as many out there as soon as possible we know a lot of people want those in time for the holidays to you can bet were trying to do that. Cook adding that he believes this will be apples best quarter ever guys, back to you. And there we see tim cook at 8 00 a. M. Sharp opening local time that apple store there in pal to alto josh, thank you very much. Lets get more details about the report of the Broadcom Qualcomm deal dom chu, it was the other day they announced they were moving their headquarters to the United States and guessing they heard san diego it lovely. Reporter just yesterday, it really was that quickly. They moved it instead of san diego, theyre talking about, you know, of course, broadcom moving to their headquarters in delaware but i mean, this could be a blockbuster deal and thats why shares of both qualcomm and broadcom are on the move higher as you can see there and this is according to multiple reports at this point this is singaporebased soon to be u. S. Based broadcom looking at a deal to buy fellow Semiconductor Company qualcomm, a u. S. Based company now, thats according to sources familiar the initial reports from bloomberg sent shares of qualcomm up by around 20 at the highs of the day were off of those levels right now, but since then, dow jones has also reported that the same story is in play for them and that it could launch a bid possibly as early as this weekend. And now just in the last half hour, 45 minutes or so, even more headlines coming out of Bloomberg Citing Sources that a deal could be around for 70 a share for qualcomm and its a mix of cash and stock that would put qualcomms value around 103 billion. Now, we have reached out to broadcom for a comment not heard anything back as of right now. A qualcomm spokesperson did tell us, though, they have no comment and for some context, you made mention, according to rich peterson at s p global intelligence, a hypothetical deal of this size would be the biggest global tech deal ever, eclipsing dells deal to buy emc. So a lot of moving parts here, and both stocks i mean, this could be, of course, this is all source reporting citing people familiar in it does if it does come to fruition, it would be a very big blockbuster deal i should also point out, guys, ripple effects throughout the Semiconductor Industry because broadcom is try to buy brocaid also qualcomm, semiconductor, lower on this news intel, a dow component also lower on this news given the competitive land scape all kinds of reverberations through the industry, guys. Im wondering, qualcomm is a different kind of chip business than the bread and butter for caqualcomm right now would there be antitrust what . What does this mean about the squirmishes right now . Were talking about two of the biggest Semiconductor Manufacturers in the world whether it its radio frequency chip sets, semiconductors, computer chips, wireless chips, that sort of thing imagine a deal between two topten players in the Semiconductor Business globally will trigger antitrust scrutiny not just here in the u. S. , but possibly in other jurisdictions like europe and of course asia as well. Thats one thing also like you said, theres pending litigation between qualcomm and apple over royalty payments, sblintellectual prope. Detail with regard to whether or not qualcomm is one of those companies from an intellectual property standpoint that broadcom would want to go after. Thats also a big deal here. Of course, we mentioned it earlier, this is whether or not this is dovetailing off the big announcement from broadcom theyre going to move their headquarters back to the u. S would it ease things with regard to Foreign Ownership of u. S. Companies because it would be a u. S. Andownership of a company so many people are maybe turning their heads and saying, hey, this could be a big deal. I also wonder, it may be about being a u. S. Company but may be about saying to the president , look, were doing something that you like, and you should like this deal, too look at what happened with softbank the first person to show up at trump tower yes, i thought of that, too, but what happens often we you get mergers of this size you get layoffs because there probably are going be some overlaps i mean, what do you think, dom the doj is already potentially raising a red flag about a trkat t time warner, be closely watched by anyone trying to do an industry deal right now. Reporter of course, there are so many dynamics with regard whether these ceos when they make appearances with President Trump are trying to curry favor with the administration, an administration that supposedly is more open and less regulatory focused on certain kinds of deals like this. I would point out, remember, were talking with broadcom trying to buy brocade, thats a committee thats going under sifius right now if a deal like this were to happen, maybe all of this, Brian Sullivan brought this up in the last hour, could all of this jockeying for position with regard to moving broadcoms headquarters per se saen legand to the United States be a precursor to getting the deal passed brocade side of things in play semiconductor still in play on the qualcomm side. There are so many deals that are contingent now upon whether or not something happens in the next three, four days with regard to a deal between broadcom and qualcomm. I mean, i need a flowchart at this point right now to keep track of all of this. I do, too i apologize ahead of time. I figure theyre going let the chips fall where they may. Reporter oh, i see what you did there, though. Thank you very much. Reporter you got it. Dom, thanks. Lets get to our Closing Bell Exchange with major averages higher today. We had that jobs number out this morning. The impact of the markets. Michael is back with us today from hightower hes at post 9 sitting next to torison from Deutsche Bank securities sitting next to steve grasso from stuart frankel, also a cnbc contributor. Theres Rick Santelli in chicago. Good to see you all. Let me just bring up the jobs number i mean, you know, the expectations were high maybe looking for a rebound from the decline we saw the previous month which was revised higher but you know, 2. 61, thats still a decent number for job growth right now, isnt it . Well, from, i mean, we had expected a bigger rebound, but generally speaking, this number is definitely not bad. The big issue is that if you look at the weathersensitive sectors, that i did, of course, get quite a hit last month but the weathersensitive sectors did basically more than pay back what we lost last month. So in that sense, it was okay, but the headline was not as big as the market would have liked to see steve, what about you i mean, was there a big reaction to this report whats the market kind of thinking about this broadcom deal potentially what do you think is on the mind here dow up 18 points. Lets start from the beginning of the day, when you came in this morning, kelly, you had every reason to think, you know what, maybe this market is worth a chance of selling it again, every sell really hasnt taken hold for any longer than a couple of hours, couple of moninutes basically yesterday we got the tax reform deal we also wind up seeing the new fed head we are on the heels of seeing all large cap tech have had reported already so if ever there was a chance where you figure, you know what, let me take a stab here, im fully invested, maybe let me count my chips, throw them off and push it back in and see what happens, and you felt like the marketplace wanted to do that. Couple hours later, the market just starts rallying back. Now, i dont know whether its the tax reform sausagemaking, maybe its this deal that a Little Things are getting incrementally changed around the edges. Nasdaq up about 50 pint 50 p right now. The major part of it was the chip space deal. We whenever you want to get m a activity, it makes you want to buy the next play. The tentacles are long and lasting and going to put the bears on theirmichael, the nasdn a stellar performer this week thanks to the faang stocks of which are pretty much trading at alltime highs do you like that group right now . Are they getting rich for your blood . What are you doing here . We go back to what steve said from the beginning of the day, there were so sm positive things happening. The jobs number was based upon there were so many variables with the hurricane, everything that happened there lets not forget apple just blew out the quarter. I mean, they we were just on the set probably three, four weeks ago wondering if apple was dead are they being innovative enough and now you have lines, thousand people long in times square, in Grand Central station, looking to get new phones, looking to get new product. It keeps coming and coming as far as the faangs and technology and m a thats going on, the positive news is overshadowing anything that happened with the jobs numbers and we also have a real keen focus on what happens now with this jobs bill i mean, lets see what happens lets see what congress decides. Lets see what the senate decides. Lets see how they come back and if this bill gets passed, youre going to bring Corporate Tax rates down to 20 which is where most of the developed countries are. Were almost double that right now. Well see what impact that could have on earnings, too. Rick, i wanted to ask you, trump announced Jerome Powell for his pick at the fed, what should this incoming fed chair, if he gets approved, do about the price of bitcoin right now does he need to lean against over 7,300 the last time i checked or close to that what does the fed do about whats happening there, do you think . Reporter you know, i dont have any idea what the fed should do about it i just know that the contract coming to this exchange by the Fourth Quarter will find many, many investors jumping in to try to short that contract which is very easy in futures thats why i think its going to be such a great success. I dont know to me, i still think i think more like jamie dimon, but it doesnt mean it cant exist, doesnt mean it cant flourish it just means that, you know, when i go to look at the fundamentals or try to pick what reasons are moving the market, its a little difficult. But when i look at our markets, i see a flattening curve and it doesnt matter if a flattening curve means today what it did 10, 20, 25 years ago. It only matters what investors think it means and to that end, the twoyear note is the only yield closing up on the week its up three basis points on the week go out to the long end, its down 30s are down ten basis points on the week. Right. Even the dollar index following the short end here which is very important when you think about the fed, dollar index is right back to 95 where it was last week and it kind of resurged back into its mode again. You know, think about it, youre jay powell youre thinking of continuing Janet Yellens raises. You might raise yourself right into a flatter, maybe a potentially inverted curve and the reasons the long end is dragging, i could give you so many let me think french ten year is at 75 basis points the german ten year is at 35 basis points heres a wild one. The italian ten year is at 175 its very difficult. I hate to get back to that relative value trade but you almost have to consider those variables didnt like the wage component at all in the jobs report today we gave up that yearoveryear 2. 9 last time. Right back to 2. 4. To me, wages are a big issue with regard to how you interpret todays jobs report. All right, gentlemen, we are out of time, but thank you all we appreciate your thoughts on the markets and the economy. Such as they are right now have a good weekend, everybody. Thank you heading to the close, weve got 46 minutes left in the trading session here everybodys higher except the russell 2000 tax effect may be a little bit there, small caps have been struggling relative to the bigger guys. Pay a higher tax rate. True all year. Understandably the nasdaq is the strongest of those major averages with tech bnology still on fire. Home building stocks fell yesterday on the gop proposal to cap the mortgage Interest Deduction. Cut it in half basically could this present a buying opportunity for investors of those Home Builders . Well debate that coming up here this hour. We want to hear from you weve actually been asking you today to tell us about your worst Job Interview story. Let us know via twitter, facebook or over email. Were going to read your comments at the end of the show for a very special reason. Well show you why coming up big thinking in the finger lakes is pushing the new new york forward. Were the number one dairy and apple producers in the eastern United States supported by innovative packaging that extends the shelf life of foods and infrastructure upgrades that help us share our produce with the world. All across new york state, were building the new new york. To grow your business with us in new york state, visit esd. Ny. Gov. We have a news alert on cvs and aetna. Yeah, what ever happened to that is. Another big possible deal Bertha Coombs, what is happening . Yeah, were seeing aetna shares spike on a report from reuters that the two parties are still talking and that the deal price could now be somewhere north of 70 billion which would combine cvs bid in cash and stock. That could reduce the Tax Liability for aetna shareholders according to a reuters source, that deal would value aetna at significantly more than 200 a share and that they are aiming to try to get the deal done by the end of the quarter cvs is on deck to report on monday morning aetna reported earlier this week, but straight off at the top of the call, mark said he was not going to talk about any speck blatiulation about the co being acquired well see what happens monday morning. That Conference Call at 8 30 back to you. Bertha, cvs shareholders continue to be nervous about this one, the shares are down another 1 . Reporter yeah, its gotten a lot tougher. Cvs shares after the news hit last week, their market cap fell to about 70 billion so it really doesnt give them much room really to use their shares as part of the bid. As far as raising cash, they already have about 25 billion, 26 billion on the balance sheet. So thats going to be a big question for analysts, if, indeed, they were to make a bid here, just how much leverage would they have . All right bert bertha, thank you. This is getting good big deals happening. Vertical deals. Alltime highs. Always very interesting very transformative. Yes thats it. Says something about where we are in the psych b cycle, too. Lets get back to the Broadcom Qualcomm deal bring in a smart guy who watches this industry, our own jon fortt also at the nasdaq i mean, youve interviewed the qualcomm ceo quite often. What are your thoughts when broadcom might be going after qualco qualcomm heres my thought, bill this is a literal head scratcher. Im scratching my head a little bit. This would be a ridiculously low price from qualcomms perspective at least i have no clear sense of how qualcomm might look on a deal like this. I did put a call into qualcomm i did not get any official response from the company about that it seems to me like a company thats trying to figure out how to react to his. I just talked to qualcomm ceo on the phone a couple days ago right at the company was reporting its earnings and he had a bunch of other Senior Executives on the line he certainly didnt sound like a guy who was looking to sell his company. Theyre still looking to link up with nxp he was talking about the positive characteristics of this quarter getting through the licensing troubles that they have with apple. One other oem and a number of different geographic jurisdictions around the world this reminds me of the effort to buy adobe back in the late 90s. I think it was 1998. At the time, though, clark had a market cap that i think was a fourth the size of adobes adobe was going through a different sort of tough period in the midst of the Asian Financial crisis and sort of saw this as a slap in the face that cork, a smaller competitor, would try to take it out now granted broadcom is not smaller than qualcomm technically in terms of market cap. That company has done quite well snapping up a number of other Different Companies but this just does not seem like the sort of thing that a qualcomm would want to do paul jacobs, who is the executive chairman of qualcomm, is the son of the founder. This is a company that sees itself as an innovator and a continuing growth story. Well see how it turns out i will just point out, ive just been told that cnbc has been able to confirm that broadcom has offered about 70 a share in both cash and stock so but that goes so jon, this is a company, qualcomm was trading at 80 three years ago. Exactly. Theyre going to accept 70 the whole reason why you have to if you believe that qualcomm is worth, you know, somewhere in the 50s or the 60s, where its been trading lately, its because you believe that theres real problems with its licensing model. Okay if youre long on the stock, and you think its worth more than that, its because you think it will get through this licensing issues as its gotten through other issues in the past now, if broadcom is going to buy it, the value has got to be in the intellectual property so the head scratcher is if they think its worth something, shouldnt investors think its worth something . And if investors think its worth something, it might be worth more than 70 bucks a share. I dont know how thats going to work out or what qualcomms official response is going to be usually we get this stuff in letters, but well see jon, just one other theory, too, it might be worth more to broadcom if they have as one analyst has said 60 plus combined in wifi and chips and the radio and qualcomms modem and processer. Can qualcomm create more volume with the company than a standalone entity in the Public Markets . Im sure samsung would love to buy apple, too. Dont start that rumor now for us no, im just saying, if were talking about arguments that could be made for combining things, look, we got the components this is not as out on a limb as that would be. It might be. Theyre in the same line of business you know, i sort of see what youre saying but is this really that much of a david and goliath youre sounding like an investment banker trying to encourage thing to go after that deal i certainly dont mean to do that what i mean to say, these are two competitors where the prey is in by some measures a lot bigger than the predator in this case its not like its an allcash deal its not like, you know, broadcom is as much of a known quantity as, say, a large mature company. This is broadcom is a company thats been making a lot of acquisitions, been a really aggressive streak thats been impressive thats the sort of setup that causes investors to take pause and take stock of what really would be the best scenario for their investment. Yeah. One final note here, jon, thank you, jon fortt there, broadcom shares at 271 they were at 30 five years ago. Thats a powerful currency for deals like this. Thats amazing. Well, theyve gone through a lot of acquisitions over that time, too, as well. All right. It goes without saying all of us here at cnbc, we are thrilled, we are relieved, and we are so happy to have our Sharon Epperson back. Shell be here with a very personal story about avoiding financial disaster during an unexpected change in your health thats coming up here. Also former fdic chair and College President sheila bair joins us to weigh in on the impact of College Loans and on the Financial Sector thats coming up howd that go . He kept spelling my name with an i but its bryan with a y. yeah, since birth. That drives me crazy. Yes. Its on all your email. Yes. They should know this . Yeah. The guy was my brotherinlaw. Thats ridiculous. Well, i happen to know some people. Do they listen . What . Theyre amazing listeners. Nice. Guidance from professionals who take their time to get to know you. 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. Now i know ill be able to stick with him. [ male announcer ] youll be able to visit any doctor or hospital that accepts medicare patients. Plus, there are no networks, and virtually no referrals needed. See why millions of people have already enrolled in the only Medicare Supplement insurance plans endorsed by aarp. Dont wait. Call now. Story with an important lesson for all of us. Nobody likes thinking about the unexpected when your life and finances could change just like that but our friend and colleague, Sharon Epperson, was faced with that very situation just a year ago. Fortunately, she did plan ahead. And this is her incredible story. Reporter reporting on how to manage, grow and protect your money is what i do the bottom line is you probably need to be saving more than youre saving right now. Planning for the critical that, i know, because it happened to me the day started like many others making sure my son and daughter got off to school and coordinating schedules with my husband. Then i went to exercise before heading to the studio. I lifted some weights, started stretching suddenly, i felt incredible pain the worst headache of my life. The rest of the day became a blur of doctors, hospitals, emergency rooms. Scans and images revealed bleeding in my brain a bulge in the wall of a main artery there had burst it was a ruptured brain aneur m aneurism. The doctors have told me that she could lose her life or the things that make life worth living and of those two, i didnt know really which is worse. Reporter surgery was just the beginning. I spent two weeks in intensive care followed by long days of rehabilitation and ready for my recovery. Relearning how to keep my balance. And walk up stairs from caregiver, to being cared for, my recovery was more demanding than we ever expected. Suddenly youre immersed in this medical frenzy of making choices that could define your life and your family and your future. Reporter and getting back up to speed on running my familys finances took time thankfully, i had planned ahead. Something Financial Adviser Stacey Francis says many fail to do the numberone reason for bankruptcy is actually medically related. So if youre not preparing, you could be putting yourself in a disastrous situation of having to use credit card debt, even going into your retirement plan. Reporter ample Emergency Savings and Disability Insurance helped pay the bills while i was out of work. And is why preparing for the unexpected is something all of us need to do. Make sure that you have at least three to six months of your Living Expenses the next thing, look at your Disability Insurance does that pay you enough that your financial situation would still be comfortable and secure . And finally, make sure that your Estate Planning is updated. Reporter the steps i took before my brain injury allowed me to spend time with loved ones instead of worrying about money. My family and friends helped me get stronger encouraged me to walk farther. And cheered me on as i reached another milestone in my recovery lets go, mom. Reporter finishing my first ever 5k race. This was the first race shed ever done and the fact that she prepared for it through illness, that was sort of an amazing moment today we are very happy to welcome sharon back to our show. Sharon, we missed your advice. Were thankful youre okay how are you feeling . Thank you so much im feeling great. Im so grateful to be able to be back here. And be able to tell my story and hopefully to tell other people to always Pay Attention to your body always Pay Attention to your care because you just never know what could happen. You are an example of somebody ate your own cooking. Youve been telling people for years, youve been our personal finance correspondent for a long time youve been telling people this very information, to prepare for the unexpected then it happened to you but you were prepared. I was prepared. One of the things ive said so many times, because every Financial Adviser has told me this, is that youre much more likely while youre working to become disabled than you are to pass away. So when youre getting all of your Financial Information together and planning, you really feed to tekeep that in mind. Having said that, though, any surprises, anything you overlooked or learned you hadnt prepared for necessarily i didnt necessarily have everything in one place. And i think one of the things, changes weve made is to make sure that we have somewhere online, a portal, where we can go to where all of our Financial Information so if anything happens, my husband can find it or someone else who needs to find it, if hes not able to do it, can go there and find it. Not all the moves are trying to about save more money or get the Insurance Coverage although those are of course important. Some are things like power of attorney, right . Power of attorney is so critical for your medical and for your finances and the Health Care Power attorney was my husband, is my husband, and he had to make medical decisions when i was unconscious and unable to do so. So that was a very, very important role, and the financial power of attorney is also important to handle the bills and make sure everything is paid on time. Which was oh, yeah, i was just going to say, reminds me of just one other thing you mentioned which is to put your Financial Life on autopilot as much as you can. Yes it is very important and just automatic bill pay, making sure you have direct deposit, all of those things can help at this time, you focus on getting better, focus on your care and not have to focus on your finances. You did the 5k. I did. On behalf of the brain aneurism foundation. Brain aneurism foundation i did. I had great supporters the e. R. Doctor who actually first saw me and said you need to go to the emergency room right now and need to get checked out, he came, supported this race. So im very grateful to the Health System for being there, all of the doctors and nurses and everyone that was there. I was talking about personal finance from my hospital bed so theyre probably sick of me shes gone, theyre talking about this, again. There she goes again. Its important. Go ahead. I was just going to say because it was a year ago thats a long time to recover. Did you have coverage for that whole period or was that where the savings thats why longterm Disability Insurance is so very important and, yes, i did have coverage so that was really, really helpful wow thats why she is where she is and we are so thrilled i know that chris and dylan and emma are thrilled to have you where you are. Theyre so great. So is your family at cnbc. Thank you i have a wonderful cnbc family i really support the really appreciate the support that ive gotten and all the well wishes and now im ready. Tax reform, come on. All right. Ready to talk business. As i said to you, love the new do, too, by the way. Thanks so much. Good to see you, sharon. Time for a cnbc news update with sue herera. Thanks, bill, thanks, kelly heres whats happening at this hour, everyone Army Sergeant Bowe Bergdahl was spared prison time for desse dessertidessererting his post he was dishonorably discharged by the judge President Trump called the sentencing a disgrace. Bergdahls lawyer believes the criticism from trump could be a basis for dismissal. President trump when he was a candidate, of course, made really extraordinary and reprehensible comments targeted directly at our client its one of the most preposterous states of affairs that i can think of in american legal history. Walt disney istimes from advanced screenings of its films in response to a times series about the tense relationship between the company and city of anaheim. Disney called that series unfair coverage. The Country Music association is apologizing after trying to impose restrictions on questions by the media about the mass shooting in las vegas at its awards show next wednesday this after a backlash from artists including cohost brad paisley who called the restrictions ridiculous and unfair that is the news update at this hour kelly, bill, ill send it back downtown to you. Thank you, sue, see you next hour sue herera. Financials not having a great day following the release of the new gop tax plan. Plus side, the bill provides a big tax cut but caps the mortgage interest reduction which could be negative for lenders. Lets talk about that among other things joining us to figure out the impact of the tax plan on banks among other things, sheila bair back with us, former chair of the fdic, founder of the System Risk Council good to see you. Welcome back. Thanks, happy to be here. Have you thought this through yet on the impact it could have on the financial industry and maybe lenders in particular . Yeah, i think were all still dige digesting. I think its a net positive for banks. I mean, they have higher effective rates than a lot of corporati corporation. Any company that employs a lot of people in the u. S. Produce and provides their services in the u. S. Are penalized by our current tax code i think its i very strongly support reducing the corporate rate to 20 . It will make us more internationally competitive. So i dont begrudge the banks on that that will be a nice increase to their bottom line. I think the mortgage Interest Deduction is overblown other countries whove reduced it or gotten rid of it, you really didnt see a hit to home ownership. Where it probably will have an impact is in the size of the house. You know, the price of your house is maybe impacted more in terms of people wanting to buy homes, i dont see its going to have a huge impact. And i dont think it will have a huge impact on the big banks the lowering of the corporate rate is much more positive for them they dodged the bullet on a lot of things, too they didnt get the transaction tax. Didnt give a derivatives tax. Right. The cap on corporate interest deductibili deductibility, they escaped apparently a curious provision that says if you receive more Interest Income than you pay out, you dont have to deal with the cap so they escaped a lot in this bill to get a nice size rate cut. So i think its a net positive for them, i absolutely do. Sheila, the private equity firms in if particular, we saw a hit there, and, you know, some questions about thats different, yeah. How big of a deal is this well, you know, i dont know. It could be significant. I mean, they could have seen some commentary that they might just replace debt with preferred stock in financing their buyouts and, of course, banks lend to them day finan they finance these buyouts that could also impact the banks indirectly it still provides quite a bit of leverage, so and it just denies the Interest Deductibility thats something thats still being analyzed on the plus side, they might benefit from the passthrough rate cut most private equity funds and hedge funds organized this passthrough. There are a lot of rules trying to limit the ability of the super rich to use this passthrough cut but that also is a possible way they might be able to game that. So thats Something Else i think to keep an eye on. I really question that whether you need a passthrough cut at all. Passthroughs by definition are not taxed twice. Corporations are thats why you have the lower rate for passthroughs i think the case is very weak for cutting that rate. I have about 30 seconds im curious, why dont you think theyd cut the Capital Gains tax . Is it already low enough, is that the feeling yeah, i think it is you know, theres still, to me, look, i think id go the other way, if anything, because you want to make sure these corporate rate cuts enure to the benefit more broadly of customers, of workers, and so if youre worried about it all going to shareholders, it seems to be the argue for raising that rate and so i think leaving it where it was was probably the politically smart thing to do. Look, were awash with Investment Income right now. I dont really know if you need more tax incentives for people to be investing in the stock market right now sent a chill up and down someones spine right there with that suggestion. Let me ask you, sheila, before we go about bitcoin. Yep. Weve seen the price continue to surge. Yeah. I do wonder now with jay powell at the fed, dont you think the fed has to start looking at this . I mean, you know, its not necessarily the kind of bubble that swept upbanks and the economy in the financial crisis but the price does keep surging. Well, it does i dont know if this is the fed. I just worry about, you know, mom, pa investors trying to get into this. Its highly speculative, highly volatile and should know what youre doing if youre going to be investing in bitcoin or any Digital Currency i think its a small enough market, i dont see systemic ramifications. I think on the upside, the Blockchain Technology that underlies the transfer of ownership used for bitcoin has a lot of positive benefits in terms of Systemic Risk and so i think and hope the fed is focusing on if from that perspective, too all right, sheila always good to see you nice to see you. Appreciate it sheila bair. Home builders stocks were under pressure this week on concerns that tax plan will hurt the industry well debate whether this is a y t d oornity coming up. 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Home building stocks took a dive yesterday on word that the gop tax reform bill would limit two key tax breaks that favor home buyers. When we come back, a bull and a bear debate on whether its time to bail on this sector coming up. Last year, he said he was going to dig a hole to china. At t is working with farmers to improve irrigation techniques. Remote moisture sensors use a Reliable Network to tell them when and where to water. So that farmers like ray can compete in big ways. China. Oh. He got there. Thats the power of and. Welcome back the Home Builders are flat today, some declines, big declined yesterday in the session after the gop tax reform plan came out and suggested capping the mortgage Interest Deduction on new homes at half a billion bucks. So, were going to talk about whether investors should be getting in or out of housing stocks joining us, a bull and a bear. Ken zenner from Key Bank Capital markets is our bull. David from Ancora Advisers is our bear ken, in fact, you upgraded Toll Brothers yesterday after the selloff. Why . We did. We thought the opportunity of the selloff with some misunderstanding of the Tax Implications combined with our fundamental view that 3q orders for Toll Brothers were better setting us above the street into fy 18. I mean, the thinking goes that if you cap the mortgage interest, fewer people are going to want to buy a house, that will impact the demand for the houses that these companies are going to build, so their earnings will be affected. Whats flawed about that, ken . Well, theres two components here mortgage Interest Deduction, thats one element along with s. A. L. T state and local tax. Those on face and isolation would be negative. We focus on the fact alternative minimum tax, amt, is a tax overlow for high tax states. Because of that, we dont think headwinds are as onerous as people might suspect. David, you think the headwinds are pretty heavy, dont you . I do, kelly i think, first, in portfolio management, you have limited shelf space in Consumer Discretionary stocks, given that, i dont want to own the Home Builders. Simply because were later in the cycle, Interest Rates are likely to be rising. The return on capital long term in the industry is lacking the Free Cash Flow is lacking. And for those reasons, in limited shelf space, i wont own a home builder i might own and do own Home Buildingrelated stocks like masco corporation, cabinets and faucets, or armstrong that does floors and ceilings. I think those are better Wealth Creators to own in a tough space to make money than to directelyy own Home Builders. Frankly, again, too late in the cycle to want to be a home builder buyer. What do you think about that, ken . I think david raises some good points. We are more constructive on the Building Product names as we have said in the past, however, i do think the strong reaction yesterday was overdone, specifically to toll, and with our upward earnings revisions expected, we think its a nice way to play the yearend trade you buy these stocks earlier in the cycle when theyre as normally beaten up in recession or a bear market this late in the cycle, especially given the likelihood that Interest Rates are rising, but especially return on capital to the investor, i think, is lacking in this type of stage in the bull market. But david, your assumption that were at that late of a stage in the bull market that it cant be justified, look how long the cycles already been. What if this is dragged out f e the way Interest Rates are looking lately kelly, thats a good question the equity or the stock market can continue its gain but in a portfolio where i main own 40 or 50 stocks and im seeking return and outperforming in index, im not going to get it with the ohm builders, frankly. All right ken zener, David Sowerby thank you. Home builders, an important sector of the economy right now. Appreciate it. Thank you. Ten minutes to go until the bell dow hanging on to a small point. The s ps gain is almost larger than the dows here it is you coan see it on your screen. It is russell, up 48 points especially after this rumored broadcom bid for qualcomm. That is pushing both of those stocks higher. And that makes that an alltime high intraday for the nasdaq well tell you whats fueling the gains. Its not just about Broadcom Qualcomm. Well get to that coming up next helping keep shoppers safe. 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The nasdaq is not only up big today, sixth straight week of gains Bertha Coombs is over there with a look at the biggest movers bertha have to start with apple, of course, providing the biggest oomph in terms of points gains apple at a new alltime high market cap shy of 900 billion that is providing a lift here. Some of that is also spreading over to the chips. Even before we got the news on perspective bid of broadcom toward caqualcomm already chips were the winner for the week some of that no doubt because of the enthusiasm over apple sales for the types of nvidia and skyworks back to you. All right, bertha, thank you very much. I forgot to mention art cashin says the market on close orders are a nonevent today 100 million to sell abe thatmaybe thats why you to mention pbay. Robl ill go with that. Were going to come back to the closing countdown, wrap up this week in just a moment stay tuned of out performance. Where a rising middle class powers a booming auto industry. A leap into the digital era draws youthful populations to mobile banking and ecommerce. Trade and travel surge between emerging markets. Everyday our 1,100 investment professionals around the world search out opportunities for alpha. Partner with pgim, the Global Investment management businesses of prudential. 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. Three minutes left in the trading session and in the trading week, so all three of the may josh averages, the dow, the s p and the nasdaq, are finishing in record territory, but to recap this week, you have to give it to the nasdaq stellar gain, six weeks in a row now that weve Seen Technology has just found another gear as i keep saying, and late this week is when we saw a lot of the gains after the Apple Earnings and then this word that maybe broadcom is going to make an offer for qualcomm over the weekend of as much as 70 a share. So the nasdaq with a healthy gain of almost 1 . And look at the faang stocks theyre all in record territory right now. Last week, we highlighted amazon after those stellar earnings, and this week its all about apple. Facebook turned in big numbers theyre just off their highs right now. Netflix and google all doing well right now the tenyear yield, weve highlighted this week at the yield curve has flattened. Its the flattest its been in about ten years and we get the nomination now of jay powell to be the new Federal Reserve chairman dealing with the issue of trying to raise Interest Rates. The fed is selling off its balance sheet. They did 6 billion in sales last week. The biggest day theyve done in about five years and the price of oil, thats gone up to a twoyear high right now. Its around 55 a barrel, bob pisani you know what that means for the price of gasoline. So everybody, heres my tip for the day, go out and buy some gas. This weekend fill up the tank. Gasoline up a lot more than oil was in september due to the hurricanes. Right. At least refineries did better lets look at the xle. Bill was talking about oil from 52 to 55 in the last week xle is the big energy etf everybody wants. Weve finally broken through to the highest level since april or so been a heartbreaker all year you and i talked many times about people trying to buy the bottom in oil and Energy Stocks and have failed consistently throughout the year. This is the biggest rally weve seen in a while in the last month or so. Number one, weve got oil up significantly. Number two, weve got from the Earnings Reports much more disciplined Capital Spending theyre not just going out and lets do as much production as we can, lets look at it a little more carefully. Finally something that worries me a little, bill, again today, the russell 2000 down. The s p 500 is on the upside this has been a very noticeable trend. Look at that in the last month. This is happening since about october 8th. That was when corker had his big dispute. Youd think theyd be doing a little better with the tax bill lets not forget some of the Small Business groups have opposed the tax bill they dont think theres enough benefit for the Small Businesses out there. Just yet. If you believe this is some kind of bellwether for a tax reform, thats a little worriso worrisome. Closing out another very, very busy week well wrap things up and look ahead to another busy week coming up on the second hour of the closing bell with kelly evans and company. Have a lovely weekend, kelly thank you, bill. Welcome to the closing bell, everybody, im kelly evans and we have a trio of record closes on the bell here to finish out the week on wall street. Lets start with the dow, up 22 points nearly. 23,538 the new record closing high there the dow was the underperforming of the major averages, of course also have the russell small caps down. 1 today the s p 500 an eightpoint gain to 2,587 the nasdaq composite, big performer, 50 points higher to close at 6,764, a record high for the nasdaq by the way, for the dow and s p 500, this is their eighth straight weekly gain, the longest for both indexes in four years. Six weeks straight as well for nasdaq. Nordstroms and macys lower. Shedding 7,000 jobs last month with both Major Department stores reporting earnings next week, well take a look at what that weakness means for the sector and broader economy coming up. Joining me now, bill smid from smid Capital Management charlie from arial investments thanks for joining me on this friday. Glad to be here. Lets zero in owen t the bigt movers apple, up 3 , 2. 6 it closed bir might be related to the broadco measu m qualcomm news. The biggest decliner in the broad market was century link. Lets take a closer look at apple now continuing higher after last dmigts earnings beat mixed growth across all segment the, iphone, ipad, mac, Services Stock hitting alltime highs today. Bill, what do you make of it well, you make of it what its been all along which is incredibly successful consumer company, and Electronic Device company thats, you know, far and away the largest stock in the index and still has quite a bit of many momentum. You an owner of it here were not an owner like anything thats gone up tenfoal in less than ten years im an envious nonowner nevertheless, apples valuation has never been that high you know, you could have gotten involved and made a valuation argument that was pretty comp compelling, right . Well, you can, except you got two things at work, kelly. Theres always valuing the businesses and theres also the mathematical probability of a Gigantic Corporation continuing to succeed constantly. You know, i think about professional athletes and a great professional athlete will get injured or have a slump and so were 8 1 2 years into an uninterrupted bull market in stocks like apple, and they havent had an injury. They havent had a slump and if youre the person that steps in and corrects, you know, catches the next bear market in technology stocks, you very well might get damaged. Charlie, whats your floss f philosophy on that yeah, i would say of all these high flyers, apple is the one are the real business. There was a time when it was selling at a reasonable multiple compared to an amazon or alphabet or a netflix. So this was a reasonable stock i didnt buy it, either, and im kicking myself for it. I think the one thing i would quibble with in your int introduction is sure, ipads and other products were up but this is becoming almost a oneproduct story. Its all about the phone and if they ever have a hiccup on that, and people dont want to pay 1,000 for a phone, i certainly wouldnt, then the stock is going to be, look, overpriced in retrospect. All right that might be a big if as you suggested. Lets get to the big deal moves of the day cnbc has confirmed broadcom is considering making a bid for qualcomm it would be a cash and stock deal worth about 70 bucks a share, both names spiking on the news qualcomm still around 61 with a gain of 13 . Broadcom up 5. 5 and bill, i mean, this has wide imply kapgs llications here would be the Biggest Technology deal of alltime, eighth biggest deal period of alltime. Valuation at 90 billion is bigger than all the tech deals that have been done so far year to date. What do you think . Well, first off, we took a pretty hard look at qualcomm in the last year or two and had extensive conversations and when it comes to intellectual property, and who is going to win the fight between apple and them in court, we instantly threw it in the too hard pile because its outside our circle of competency. On the other hand, were they a meritorious looking company before this . Yes. Lots of Free Cash Flow, great intellectual property, a long history of success a lo the of tt of the things we. We just decided no. Okay. I will say this, these takeovers are synonymous with the late stages of a bull run in a sector go back and look at 87 in the r. J. Nabisco leverage buyout you get a lot of this stuff in a very popular sector late in the cycle and we think technology is very late in the cycle. Charlie, what would you say about that by the way, for qualcomm shareholders, even 70 for a stock that was trading at 80 three, four years ago, its interesting i dont know if they would consider it, if they would, that would tell you something. Yeah, we actually agree here that the power is with the buyers of the chip technology, not with the chips, themselves so in these negotiations, the apples of the world and the googles of the world making their own devices just have the power and it was a time when an intel chip was so valuable with its own brand and we just dont think that chip makers have that today. The r d and the Capital Expenditures are just too high for us to see good returns long term. And as you mentioned, intel was the biggest decliner in the dow today. Lets check out the starbucks chart meantime we told you about the earnings last night had the stock down about 7 initially after revenue missed expectations but it turned around this morning. And in fact, starbucks closed up more than 2 the Ceo Kevin Johnson was on squawk on the street today addressing growth concerns the fact that we were able to build over 2,000 Starbucks Stores globally that are performing at higher annual unit volumes than prior generations in an era where retailers are Closing Stores at a record pace gives us confidence that theres affinity for the brand bill, you guys invested in starbucks here yeah, weve owned starbucks for the life of our strategy, and heres what we think is interesting. First of all, it sounds terrible, wed like to own a lot more of it at lower prices so we were kind of excited in the aftermarket yesterday hoping that it would break down and wed get a bargain and instead, it turns around and we think it turns around because Growth Stocks have so obliterated value staocks value analysis has been of so little use in the last couple years that any growth stock with me hope or prayer even on a somewhat disapointing Earnings Report kind of turns around. I mean, starbucks and nike are both operating on the same wafting of growth stock outperformance. Thats whos got all the money thats whos got the inflows, index, a growth stock portfolio and other growth stock investors. Therefore, any little weakness in equality historically good longterm growth stock seems to be met by buying the dip. Heres the flip side of that coin the s p financials were the biggest sector laggard in the market today they were dragged down by insurers and lenders and aig was the worst performer there after its weak earnings yesterday. Aig closed down about 4. 5 later tonight were expected to get numbers from Berkshire Hathaway charlie, what does this say to you . That insurance is all about companyspecific information aig was down big, but progressive was up big its all about how have these exposures come in . It turned out aig had underwritten a lot of stuff in california and was really hurt by those fires where progressive, people had been worried about california, texas and florida auto losses that came in much lower than peoples expected. This is an industry where its very companyspecific. What about rates, charlie, how does that factor into the equation here, too the tenu year moved lower after the jobs report this morning. Today it didnt have much of an impact. This is a fascinating area when money is cheap, you get a lot of money coming into the reinsurance market. Warren buffett always complains that when Interest Rates are low, people underwrite reinsurance at way too low pricing. So tech generally Interest Rates going up has been good for hardening the market and gett g getting getting pricing better and lower Interest Rates have been tough on the business. For sure. Kelly yeah, quickly yeah, your discussion before we came on about the Home Builders, i find it interesting, the one guy said were a long way into the economic recovery we are, its the most anemic economic recovery, and were early in the millennials, the largest Population Group, getting into the Home Building so if he thinks that this is the end of the cycle, if he thinks that were going to peak out at what would have been lousy recession levels in Home Building before these millennials get done, hes not doing his demographic mathematics. So, bill, i know this is a sort of an industryspecific call what does that mean for the overall rally and even for the economic expansion i think it might be like an 87 or it might be like ultimately when the tech bubble burst. The economy, the United States, is on such good footing in relation to historical measurements like Household Debt to service ratio, and other things because the Largest Adult Population Group has yet to do the biggest borrowing of their life which is a mortgage by the way, the fear about the Home Builders on the deductibility and limit on 500,000 mortgages, well, we own nvr. They sell an average price of 383,000 and we own lennar, they sell an average price of 400,000 how many people ever take out more than a 500,000 mortgage to buy a 400,000 house bill, wheres your office in seattle. Okay. Well, thats interesting washington has no state income tax. We could talk about new jersey and upstate new york i was surprised to hear their congresswoman earlier today saying she supports the bill the property tax rates, you know, for upstate new york for a Property Value thats not even that high, it does sound like theres going to be real negatives there. You know, i love you for bringing that up steve case wrote an essay in the forbes 100th an versevy about what he calls the rise of the rest if this tax bill becomes law as it is right now, we will see the biggest in migration of people between 25 and 40 from the expensive coastal areas to the rest of the country. Case calls it the rise of the rest all right i like that. Im going to look for it we got to talk about media stocks for a second, though, because discovery got hit big again today. The second day in a row on cordcutting concerns. It was down 4. 5 st it a 52week low, by the way, only cvs managed to close highe after its Earnings Report yesterday afternoon. Charlie, cbs says cord cutting doesnt hurt it. Discovery said it needs to finds a way to get into the streaming game. I apologize for not owning apple. Im going to take some bows that arial owns a lot of cbs. The same thing i talked about that companyspecific. Cord cutting doesnt hurt cbs. They have a broadcast channel and over the top channel and theyre doing very well in political advertising which, of course, the cable nets dont really get nearly their share. So cbs has done very well while the cable nets have not. Probably the acquisition that they made of the big acquisition that discovery made probably doesnt look as good when they bought scrips. Much bigger in a bad business. Cbs and meredith, the local tv station company, have been very strong all right thank you, both. By the way, bill, what jobs are these millennial who are moving from the coast inland going to get . Are they working from home oh, you can take a Software Engineer to kansas city to work on a mutual found compaund comp. They dont have to be in new york you can take them anywhere all they need is water and wifi. Lastly, charlies right about cbs. We own tegna which owns the largest cbs affiliate owner and the same things drew on the individual local tv affiliates for cbs and nbc. They also are defended from the cord cutting all those over the top people end up wanting, the people that have them want to watch their local news guys, thank you so much its been a pleasure bill, charlie. Water and wifi are the new staples. And we know thats true. Apple shares hitting an alltime high today after its big earnings beat. Closing in on that 1 trillion market cap growth in china a huge part of the profit boost up next, well discuss whether the release of the i dpoiphone china can keep it doing. Retail jobs falling for the eighth time in nine months we found that out this morning how that could impact the economy coming up. On this jobs report day, we want to hear your worst Job Interview story. Let us know on twitter, facebook or send us an email lreal the top stories later in the show with a little surprise stay with us stay with me, mr. Parker. When a critical patient is far from the hospital, the hospital must come to the patient. Stay with me, mr. Parker. The at t network is helping First Responders connect with medical teams in near real time. Stay with me, mr. Parker. Saving time when it matters most. Stay with me, mrs. Parker. Thats the power of and. Apple shares hit an alltime high today after beating on earnings yesterday shares up about 2. 6 see growth in Greater China after a challenging past couple years. 12 Revenue Group there. Ceo tim cook addressed this in last nights Earnings Call. China rebalanced broad base across the products and so we just had a phenomenal quarter on ipad, on the mac, on services, on apple watch, on iphone. I mean, we literally were firing on all cylinders. All right can that growth continue into next year . Joining us, tom from the information, and ryan from idc. Thank you both for joining us. The china issue has been a big problem for them, hasnt it . Is this enough to quell concerns in that area too soon to tell. Investors are sensitive to anything happening in the china market because its essential to apples growth, specialically t specifically the iphone. Building stores and distribution in the area. If you listen to what apple has to say, they see the recent quarter and success there as a result of that investment. But i really do say its too soon to tell with only one quarter to look at. What do you guys see as you look into 2018 for the chinese phone market right, so as a whole, we look at the chinese phone market rebounding slightly to about 5 growth, but were actually expecting apple, themselves, to grow much faster than the market, itself so were expecting close to 20 growth for apple with its iphone business in Greater China in 2018 ryan, if they do, i see you guys have their current market share somewhere around 12. 5 in that country which is not huge and its one of about five major players. What would 20 growth do are you increasing market share dramatically if they can achieve that right, so the 12. 5 just to be clear is globally thats where apple kind of stands right now i think what were seeing with apple with regards to china is their last real big cycle was around 2015 when they launched the iphone 6 right . We saw enormous surge in buyers in that market, and then things slowed down. So what were looking at is basically those buyers that are on either a 2 1 2, 3 year refresh cycle that are ready to purchase iphones as tim cook mentioned, there are also strong sales from ipad and also mac as well but just to be clear, most of these sales are happening in the tier 1 cities, not the rest of the population where most of the mass volume goes yeah, tom, maybe the market share in china is actually lower than that figure that i cited earlier. So, again, what is the significan significance you mentioned how china is essential for apple. How essential is it . Well, very much so. I mean, if you look at where their growth is coming from, its in these developing markets like china, like india i mean, you saw apple really struggling the last couple quarters in terms of gaining market share huge amount of competition from smartphone makers domestically so if they can prove that there is a sustainable quarteroverquarter growth of market share within china, then they should look pretty solid, but it really takes more than one quarter to prove that out. And also, tom, the numbers that they put up in terms of the iphone projections, what was your feeling about how much clarity tim cook could give about how many of those devices bill be produced and sold in total for this company yeah, i mean, there were strong projections in the last Earnings Call and so it looked fairly solid as far as that goes, but, you know, theres a lot of questions, especially with the iphone x about manufacturing and whether they can meet demand. Theres obviously supply chain questions given all the complex components there so, you know, if we can see, again, them being able to meet demand, and if china does, in fact, show Strong Demand for the iphone x, its very, very possible this growth could be continued. All right guys, thank you. Tom and ryan as apple closed today nearly at an alltime high. Berkshire hathaway is out with its earnings a little earlier than usual dom chu has those numbers. The numbers are still big even on a pershare basis, kelly. Lets get you to the numbers here first of all, berkshire earnings were share is a narrow miss in terms of earnings per share. Its 2,0 the94 per share we should also point out that many of the adverse impacts of the hurricanes and earthquake in mexico took their toll on the numbers in terms of berkshires numbers overall. They say 3 billion in pretax underwriting losses on those three hurricanes, harvey, maria, irma, as well as the mexico earthquake, that translates into 1. 9 billion on an aftertax basis. Another number that a lot of investors like to look at with regard to berkshire earnings is the book value per share they note that in this past quarter, book value per share was 187,435 in terms of every class a share. We smouhould point out the shars closed no trading of the aftermarket for size reasons were seeing a little action in the berkshire b shares down a percent on 23,000 shares of volume also want to point out as we go through these numbers we did see a revenue beat from berkshire, 60. 5 billion. Analysts were looking for 59. 79 billion. Were going to parse through this more, the details and numbers. For right now, it looks like an earnings miss, a revenue beat. 3 billion in terms of where ioff writeoffs, underwriting side of things because of natural disasters and thats where we get to those numbers for book value, kelly back over to you guys. Dom, thank you very much. Lets get reaction to the numbers from fast moneys guy adami. Kell, i think its okay given the hurricanes, what my man dom chu said, i dont think its a disaster at all. Im doing back of the envelope stuff. Book value was up 9 from the beginning of the year indicates the old man hasnt lost a lot of his fast ball. You stay the course. Cant trade it, you know what im talking about . Stay the course. You could trade the bs. Im kidding around. Come on. Work with me i thought i just wanted to clarify, make sure im foll following, guy youre ahead of me let me catch up with you and do a little takeaway, dont you think, while youre here in mike santolis absence, mike, thanks for joining us. Nervousness in the private Equity Industry over the gop tax bill they think it could stunt leverage buyout buyouts. Is the selloffs in names like apollo justified, guy . You a fan of r. E. M. , great 88 80s ban of course you are. They sang a song you want to hear the name of the song everybody hurts. Everybody hurts. You know, private equity hurts, too. Too bad. Theyll figure it out. Is the selloff overdone . If you look, apollo was up 1. 5 . Kkr up 2 today. Both of the stocks have been on a nice trajectory higher so in my world, its not a selloff at all if theyre complaining, they got other things to complain about were all in the same boat there, people. Speaking of apollo, the companys reportedly looking to buy kidoba from jack in the box. Given the recent stumbles and changing tax rules we just mentioned, guy, does that deal make sense to you . I think it makes a lot of sechb sense, makes a huge amount of sense. Why . Qdoba is the shining star, its the diamond. Its the cherry on top of everything that jack in the box has. If you look at the reason that jack in the box has performed as well as ithas, its because of whats going on at qdoba put that on top of all the misses and all the bad things going on at chipotle, cmg, and if im jack in the box, im not eager to sell qdoba at all. Thats what i was going to say. Without qdoba, jacks got jack. Jack was higher, but i think i know where your sympathies lie. Next, pizza hut is not seeing a hit in sales because of issues with the nfl. Recall the papa johns, big nfl sponsor, lashed out pat the league for not handling the anthem kneeling well and hurting sales. Pizza huts Parent Company yum brand have seen an uptick in sales from live sporting events like football. Whats the trade, guy . I think papa johns messed up a little bit i understand they are a sponsor of the nfl but i would submit, i might be wrong, i typically am wrong, that papa johns needs the nfl more than the nfl needs papa johns. So in my world, dont bite the hand that feeds you. And the play all along has been dominos comes out dpz, a steve grasso favorite. Why . Because they are now a Technology Company my advice to papa johns is theyve been saying that for a couple years now. Take a step back and rethink this whole thing youre doing. Or maybe invest in technology if thats whats working. Maybe invest in technology. Finally, kneelsnielsen is reg netflix ratings which netflix doesnt accept it shows 15 Million People watched the season premiere of Stranger Things and season as a whole averaged around 9 million. Should netflix embrace the transparency netflix should spl embrace the technology and be transparent. What does it mean for the stock . Despite what people say, netflix has a mote that stock will continue to go higher Stranger Things or not all right it closed at 200 on the button. Guy, thank you very, very much appreciate it. That instant reaction to berkshire, too catch guy and the rest of the fast money crew at 5 00, with one of the streets biggest bitcoin bulls, why hes become cautious on the cryptocurrency. Broadcom reportedly interested in buying qualcomm. Both stocks are rallying on these reports. Find o if utthe deal makes sense for shareholders of both companies, right after this. Tim. 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. whoo woman class, lets turn to page 136, recessive traits skip generations. molly i reprogrammed the robots to do the inspection. Its running much faster now. See . Its amazing, molly. Thank you. your kids go to college and you start trading. Yeah, 5 years already. 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. News update, lets get over to sue herera sue . Thank you very much, kelly. Heres whats happening at this hour, everyone Congressional Democrats continuing their assault on the House Republican Tax Reform Bill Senate minority leader schumer blasting the bill for hurting working families adding that even republicans dont like it republicans are ashamed of this bill. Thats why they dont want hearings, thats why they dont want discussion. Thats why they dont want to allow their constituents to let their voices be known. And if this were my bill, id be ashamed of it, too the man suspected of fatally shooting three people in a Colorado Walmart Store made his first appearance in court. 47yearold scott ostrem is being held without bond. He could face the Death Penalty or life in prison. Prince william attending the graduation of almost 200 new London Police officers he was accompanied by the lobd London Police brass. Afterwards he met with graduating officers and also the Police Liaison officers who responded to that grenfeld tower fire earlier this year kelly, back down to you. Have a great weekend. Thank you, you, too sue herera at headquarters. News breaking this afternoon, broadcom is considering making a bid for qualcomm would be a cash and stock deal for art 70 a share. Qualcomm close ed hered higher. Joining us on the phone with his reaction is tom sepenzis tom, are you excited about this deal well, it certainly makes a lot of sense, and its in, you know, the historical keeping with, you know, growth through Acquisition Strategy so i certainly think that it would be great for both companies if they could get it done, but i think there might be problems getting it actually closed antitrust problems . Yeah. I would think that theres going to be a number of issues qualcomms already run into some issues with the acquisition of nxbi you know, that will only complicate matters with braoadcm trying to buy qualcomm what happens with the nxbiing a b decisi acquisition. Does that go through, get dropped . Theres a lot of moving parts between the two companies. That will make it difficult. Yeah. Absolutely nxpi has some expertise in automotive, as i understand it so if they were to be jettisoned, does that worry you, as a qualcomm bull here . No, actually it wouldnt worry me at all. As far as broadcom and qualcomm merging, theres tremendous synergies between the two companies and surprisingly not a lot of overlap you know, you got qualcomm which makes the base bands of the chips that go into the phones. You know, the brain, so to speak, of both the radio and the processer. Then youve got the radio frequency side of it so from that perspective, theres really no overlap. It would be a really sinnynergic merger similarly, you know, broadcom is much more involved in the server business most of that is using intelbased components whereas qualcomm is the First Company to actually get an arm server, you know, into at least sampling so there would be no overlap there, again, a very nice synergy for the combined company. We saw that intel was lower today by more than 1 . Why do you think it would be selling off on this deal, if it was . Why would intel be well, it would, you know, the combined company would have a pretty similar market cap, right, to intel, so it would give them a rival that was equal in size and probably a lot bigger in terms of scope of what they could do so, certainly would put some pressure on intel. I dont know that it would be, you know, direct on their processer business or their server business, you know, in the near term which is still 85 of their combined business so i dont really see this being a real problem for intel as a direct threat. And tom, im wondering what you think about the 70 share price thats been mooted when this company traded at 80 a few years back yeah, certainly lower than what qualcomm would probably want, yuou know, i cant speak t whether thats the real price or even if theres going to be a bid. Bs sense in the current environment in terms of premiums weve seen other Semiconductor Companies go for over the last couple years and, you know, but obviously qualcomm shareholders will probably want to try and sweeten that deal does it make sense for them to sell below 80, below something above that again, that was something that was achieved a couple of years ago. Why is it now seen that this Company Might be less valuable than it was . Well, clearly, you know, theyve got a lot of legal issues going on right now. Not only with the american and the taiwanese and the korean free trade organizations, but also with one of their biggest customers, apple so that has really eaten into their market cap, its eaten into their value its got a lot of people concerned over their business model, and what the eventual impact will be i, myself, have an outperform on the stock because i have covered the you know, ive covered qualcomm for the better part of 20 years and ive seen them run into these legal issues before with erickson, with nokia and others and generally speaking they come out victorious pretty much every time. So i do think that they will, you know, likely emerge better than people are expecting here with this apple dispute. All right well see what emerges with broadcom, too. Tom, thank you very much for your time. Thank you appreciate it. Tom joining us from northland capital markets. Meantime, retail jobs are one of the biggest weak spots in the october jobs report we got this morning up next, well look at whether problems with retail could end up putting the broader economy at risk. Several popular employee tax perks will be repealed under the proposed republican tax plan in congress well tell you what they are includes corporate gyms. See how you could be impacted later on the closing bell. Nci, and saw his portfolio drop by double digits. It really scared him out of the markets. His advisor ran the numbers and showed that he wouldnt be able to retire until he was 68. The client realized, i need to get back into the markets i need to get back on track with my plan. The Financial Advisor was able to work with this client. Hes now on track to retire when hes 65. Having someone coach you through it is really the value of a Financial Advisor. Welcome back closing out the week with gains mostly across the board on wall street russell was lower by a point, but the s p was up eight the dow was up 23. The nasdaq was up 49 for the major averages, those are all record highs for the dow and s p, their eighth straight week of gains. First time in four years the markets achieved that. Retail sector losing 8,000 jobs last month. We could hear more about job losses next week when we start to again earnings from a number of retail companies. What impact could the jobs drought have on the overall economy . Joining me no u, chris lowe from ftn financial. Cnbc contributor from jay rogers niffen wwe did i get that right anyway, jan niffen is here thank you both for joining us. Chris, let me begin with you i mean, eight months out of nine now is a big deal in terms of retail streak of job losses. How much of an impact do you think thats going to have more broadly . Well, i think it will probably be isolated to retail the thing is that consumption lost quite a bit of steam early last year. Dropping from 4 growth to about 2. 75 . But its been stable since then. So this ongoing weakness, 66,000 jobs lost, so far this year, is pretty clearly a reflection of something going on within the industry and i suspect its the amazon effect. You know, its online retailers eating their yeah. Lunch. And amazon, itself, you know, its head count is expanding. Chris, thats the interesting thing. You know, in a way, now especially that its bought whole foods, its head count is, its getting up there. There are 541,900 employees. I think walmart has 2 million. But amazon, itself, is turning out to absorb a number of these job losses, dont you think . Oh, i think thats absolutely right. And remember, they are included in that survey, so take amazon out and theyve added about 25,000 this year, and the losses amount to 90,000 in the rest of the industry if youve seen an amazon fulfillment center, they are enormous, and theyre very lightly staffed. I think thats the key to whats going on they are simply way more efficient at getting goods out to customers with fewer people this is a huge productivity gain in this sector, but while were in transition, it is costing jobs so jan, what do you think this sets up for as we get into retail earnings season i dont think thats an issue. The retailers, themselves, arent as healthy as they should be the consumer is very healthy the consumers got better job pictures than in a long time not much in rising wages but a little bit of that unemployment is low, employment is high. Energy costs are low the consumer is in good shape. Were going to see fine growth in the Fourth Quarter in consumer sales what were not going to see is in the Retail Sector im used to which is the brick and mortar sector theyre going to continue losing jobs closed 2,500 stores this year. Only open bd 3,000 thats going to cause job losses as your other guest just said, when amazon adds a person in the distribution center, three people go off the floor of retailing because thats how much more efficient the Distribution Centers are and theyre not Running Stores so, yeah, they continue to grow, and then the retail jobs continue to shrink but its not something wrong with consumer. Is it something that from an investor point of view knowing how challenged some of these companies are, is it better for them to shrink their head count in order to try to just stay as profitable as they can while they contend with what sounds like a secular decline yeah, theres no option, they have to shrink, be more efficient, have to try to make money online which is really hard after all, amazon doesnt make any money online, either, so its very difficult in that environment. So they keep shrinking the base trying to be more efficient on cost and moving more and more Business Online which is low profitability. So its a difficult place to be if youre a brick and mortar retailer given that. Yeah, were going to get a slew of them headed our way next week nordstroms, macys, jcpenney. Well let you go and see what happens. Thanks for joining us. Donald trump embarking on his 12day tour of asia today. Theres a lot at stake for business both big and small. Why hoards of small and Mediumsized Companies are hoping trumps trip is a success coming up. On this jobs friday, we want to hear your Job Interview Horror Stories email us, facebook, tweet you can see it all there i may read your tale on air in todays closing bell mailbag well be right back. I cant wait for her to have that College Experience that i had. The classes, the friends, the independence. And since we planned for it, that student debt is the one experience, im glad shell miss when you have the right Financial Advisor, life can be brilliant. Ameriprise not rebalancing your portfolio. Focused on what you love, not how your money will last through retirement. We make it easier to plan for retirement with day one target date funds from prudential. Look forward to your 401k plan. We have a news alert on Harvey Weinstein julia boorstin, what now kelly, the new York Police Department say its building a case against movie mogul Harvey Weinstein following a range of accusations including Sexual Harassment and rape, including a recent one from actress paz who accused weinstein of raping her twice in her apartment in 2010. We have an actual case here were happy with where the investigation is by now. Mr. Weinstein is out of state. We would need an arrest warrant to arrest him. Right now were gathering our evidence we continue to do so every day police say they just became aware of this latest accusation on october 25th. We reached out to weinsteins representatives but have not yet heard back guys, back over to you thank you, julia. Julia boorstin well, theres one key issue many u. S. Companies want President Trump to bring up on his trip to asia well tell you what that is right after this fees . What did you have in mind . I dont know. 4. 95 per trade . Uhhh and i was wondering if your brokerage offers some sort of guarantee . Guarantee . Where we can get our fees and commissions back if were not happy. So can you offer me what schwab is offering . Whats with all the questions . Ask your broker if theyre offering 4. 95 online equity trades and a satisfaction guarantee. If you dont like their answer, ask again at schwab. Rays always been different. Last year, he said he was going to dig a hole to china. At t is working with farmers to improve irrigation techniques. Remote moisture sensors use a Reliable Network to tell them when and where to water. So that farmers like ray can compete in big ways. China. Oh. He got there. Thats the power of and. His family. His steinway, which met a burst pipe. So grant met his insurance you are caller number 12. Which didnt quite cover the steinway. But what if hed met pure insurance . Owned by members. Hed have met lisa, your member advocate. Whod introduce him to gustav, a temporary address, and help him get tickets to the mozart festival. Excuse me, grant likes beethoven uh, the beethoven festival. Pure. Love your insurance. House republicans revealing their tax plan yesterday and some Employee Perks could be at risk if it passes. Ylan mui joins us with the rundown. Hmui joins us with the rundown. Reporter kelly, its the Little Things that will get you. Weve been talking about the corporate rate, is there a connection between profits and wages. Sometimes you just need to know can i still direct my parking. The answer, at least right now, is probably not, because this bill takes a whack at a lot of popular perks. Transportation Fringe Benefits is one of them another biggie, Tuition Assistance under current law, your company can give you up to 5,250 al annually to pay for school you arent taxed on that benefit and your employer doesnt have to pay taxes on it either. That would go away in the pending bill kelly, lets say you get a dream job at apple, not that this isnt already your dream job, you couldnt deduct your moving expenses theyre even coming out of employee achievement awards, thats when they give you a gold watch, thats now taxed too. This is all just a numbers game. Theres at least 30 billion of revenue over the next decade and getting rid of these perks, thats a drop in the bucket compared to the 1. 4 trillion price tag. But republicans dont have a lot of wiggle room as they try to make the math work, kelly, every billion counts if i have to pay taxes on the toaster, i dont even want it. Reporter the toaster oven. Yeah, im trying to remember what i even picked out ylan, these all nighters are catching up with you reporter the tax tsunami is taking a toll on my throat, apparently fascinating stuff, anyway i had no idea so much of this was at stake how important are these deductions reporter this is a good reminder of how far this bill is you dont know which tiny provision is going to crop up and become potentially the poison pill in the entire bill theres another provision thats getting a lot of political buzz, thats one that allows you to begin contributing to a 529 for your unborn child. It seems like it makes sense, you want to start saving as soon as possible for college. But it raises a lot of thorny moral questions about when does a fetus become a person. So thats another one, seems like a small line item, but its becoming really politically divisive i had no idea, ylan, thank you very much. Holy cow all right. Ylan mui, really appreciate it meanwhile, Steve Mnuchin and gary cohn are hunkering down in washington to work on the tax bill, and President Trump is on his way to asia. Reporter ivanka trump and her husband Jared Kushner will be accompanying President Trump to japan, south korea, and china. National security adviser h. R. Mack master said the u. S. Trade representative would be leading economic talks during the trip commerce secretary wilbur ross will be bringing two dozen ceos for a trade mission to china also spotted on the plane, dina powell and matt pot tenger people like drew greenblatt, whose baltimore Steel Company sells racks to walmart and merck and checks Google Images to check on chinese competitors every week who steal his intellectual property. Think about if someone were to stick their arm through the internet to steal your car or your tv. You would be outraged. That happens to us every day, theyre stealing our intellectual property through the internet and representing its themselves, and growing jobs in china rather than us growing jobs here in Baltimore City reporter tensions running high in the region the north korean threat on the horizon. Trump will spend the weekend in japan. A flyover was called by north korea a move that was seeking to ignite war and it threatens to overshadow the whole trip. Thank you, Kayla Tausche surprising truths ouabt the hiring process, those details are next so what else is new . Hows your mother . Umm. Shes doing good. She needs more care though. She wants to stay in her house. I dont know even where to start with that. First, lets take a look at your Financial Plan and see what we can do. Ok, so weve got. Well listen. Well talk. Well plan. Baird. Whether its connecting one of or bringing wifi to 65,000 fans. Campuses. Businesses count on communication, and communication counts on centurylink. A new poll is revealing some pretty surprising things about the Job Interview process. Eric chemi has more. There are embarrassing and outright illegal moments people have had when interviewing for jobs people have had their minds go completely blank 28 of people completely forgot the name of the person across from them doing the interview. 10 arrived late 4 had food stuck in their teeth. People have dealt with illegal questions. Almost everybody has been asked something about their age or marital status or medical history or even their plans to have children. And 10 of those under 30 have admitted to being flirted with or being asked a suggestive question during the interview. Nearly three out of ten people actually admitted to lying in an interview or an application for things like skills, prior work experience, even illegal drug use. Remember, thats 28 of people who admitted to lying. Im sure the real number is a lot higher catch more awkward Job Interviews on cnbcs upcoming show the Job Interview which premiers next wednesday at 10 00 p. M. Wednesday weve been asking, of course, for you to send in your awkward moment it was minus 20 degrees, i wore a pantsuit, hr told me i didnt get the job because i didnt wear a skirt to the interview. It was the late 80s, she said, but poor janet jean says, the gentleman was yawning this much, i thought, whats it going to be like working here rick tweets, the interviewee, a person being interviewed, who wasnt rick, talked himself silly, suddenly said i assume i didnt get the job, and let himself out, and we sat in silence. That feels like something we might see on the series. A millenial moment of panic. Or texting in the middle of the interview. Thats interesting, checking the phone during the interview, is that a yes or a no . I once had an interview where he said you have the job, then he kept talking another 45 minutes, and i just sat there not sure what i was supposed to say. I had an interview where the interviewer kept talking to someone else, and then months later i found out i got the job. Fast money starts right now, live from the Nasdaq Market site im michelle carusocabrera. Intel is about to come to a screeching halt, we will explain why. Plus a twitter employee goes rogue and targets trump. Is the president s twitter feed the biggest risk for the rally then later, the bitcoi