Transcripts For CNBC Closing Bell 20171117

Stitch fix is having its first trading day doing, well lets see, it started out higher it did dip below the 15 ipo price. Its just above that level right now. Does the Subscription Service have ha what it takes to take on amazon a you know there are 2,000 companies in the same business essentially. Im shocked that its that high, actually. Birch box does makeup, and my favorite is the one called bark box for your dog they send treats and other fun things each month. Sounds like its right up your alley i guess President Trump said that he was focused on fair and reciprocal trade in asia during his trip overseas. Larry kudlow is going to weigh in on what that could mean for wall street. And whether investors should be concerned. Larrys not real hes not exactly seeing eye to eye with the president on trade issues ri right now. Thats for sure. We begin today with media merger talks heating up, sources saying comcast and 21st century fox, some of foxs assets and the cable giant, comcast, may not be the only one. Lets get over to Julia Boorstin for the very latest. Reporter kelly, sources tell us that comcast is interested in buying foxs entertainment assets the same assets disney was pursuing a huge part of their appeal, their International Scope including sky in uk and star in india, as well as big brands such as avatar and xmen and digital reach with hulu. A source close to the situation tells me that verizon has also reached out to fox about those assets as well as it looks to keep up with rival at t and its pending acquisition of time warner i spoke to cbs Ceoles Moonves at our net net conference last night about what all this means for the media landscape. I think we were all shocked by the initial announcement which was on cnbc art about murdoch potentially selling some of his content assets. And that sort of surprised me because we all envisioned ruppert as somebody who is always expanding and the reports from cnbc that day said, well, the talks had stopped and no surprise, you know, Brian Roberts stepped in there so i think what it says is content assets are unbelievably valuable reporter moonves also told me hes surprised about the department of justice pushback on the at t time warner deal he says that will be watched closely as a sign of how likely a fox acquisition would be to be approved back over to you all right, julia, thank you very plucmuch it seems every media outlet, maybe amazon to verizon, are being touted at potential suitors for 21st century fox and some of their assets which media marriage makes the most sense for investors for consumers . For regulators maybe taking that into consideration joining us with their analysis, jeffrey is with jbl advisers and scott rosten from training the street gentlemen, thank you both for joining us jeff, heres a question, first of all, that i have, do all the assets that are being discussed have to go to the same suitor . Could things go in Different Directions based on who is the best fit i mean, how do you think this thing shakes out well, once you begin to parse the assets of fox, theres no requirement that they have to go to one particular buyer. And especially given the fact that regulatory derby is going to be a big factor in making any kind of decision right jeff, what is your perfect marriage of Media Companies . Well, disney certainly fits exceptionally well, the film and television sides of the business, particularly the Television Production side both companies whether its comcast or disney would certainly have a great love for star and for sky i think that once you get beyond that, then its a pick and choose and how do you fold it in, whats the price, what happens with foxs debt, how much of an ownership interest do you want the murdochs to have in your company, are there Strings Attached to that, board seats, et cetera. Scott, how about you . What do you see happening . What would make the most sense for you at this point . Well, if i go off of jeffreys point, one other consideration here is tax bills. When you start to divide up a company, potentially lead to taxable transactions and the tax leakage could start to make an economic dis inceincentive to d transaction. It gets complicated. I wouldnt rule that out altso, too. Thats why god created accountants. Is thats true. Also why fox may be able to look at potential suitors, what shares are the most valuable currency, is it comcast, diseconomy like jeff, it looks like you think either one make a fit here Something Else to think about, their ability to pay when youre talking about disney, comcast, verizon, these are Big Companies with big Balance Sheets and a big ability to pay. Stocks in general at a high women me which means acquirers are feeling great about it the other wildcard out there, lets tie this to whats going on in washington, with if there is a tax bill passed with the e repatriation of foreign earnings, all the companies are going to have a big war chest to actually do it i think another element to think is some of the more nontraditional Media Companies that can potentially come in here, think about the traditionally more Tech Companies of the googles and amazons, netflix, even apple of the world, theyve got big Balance Sheets, theyve got a lot of money overseas. They want content. So its a content race and i think its wide open and any time you get a deal like this, i, you know, i understand why the buyer is wanting to buy but i always ask myself why is the seller wanting to sell . Jeff, why would the murdochs want to be selling these obviously valuable assets right now, do you think . Well, clearly this is a new point of departure for fox i dont know if this is a kneejerk reaction to the regulatory activities in the uk, or whether theres just were willing to give up, were will to move on, were miwilling to monetize the Great Company we built over the years i also wonder if theres behind the scenes in the family issues that are creating this, at least a think spot, for fox. Yeah. Going to be all sorts of speculation. Scott, real quickly before we go, we showed a graphic that also had amazon and netflix. Is that because you think a tieup of those two is a good idea potentially look, theyre both racing to acquire content and theyre both spending billions of dollars to acquire content, so as you saw with moonves quote last flight, content is king. Its at a high premium right now. And the valuation makes sense. Ultimately its something in class all the time, ultimately if youre the seller, the valuation needs to make sense. Better to sell now and monetize it than go alone yes, theyre racing to acquire content. Its expensivexpensive. Maybe buying those media assets could be a faster and quicker way to do it all right jeff, scott, thank you both. Appreciate your thoughts thank you. On a fascinating story as it continue to unfold here thanks for joining us. Lets get back to the Broader Markets with the dow down 85 points but the russell in positive territory today. Joining our closing bell exchange, cole smid from smid Capital Management kenny from oneal securities Rick Santelli from the cme in chicago. Welcome, everybody kenny, what do you make of this market and as we mentioned, some of nose aftthose averages goingo different ways. Right aisle surprised at all, after what we saw yesterday the market exploded to the upside yesterday it was walmart, cisco, it was also the house passing the tax vote, everyone was so excited about it, look, were going to get tax reform. Today the arguments about, well, okay, thats fine, component now were back to the senate the senates not so sure theyre going to pass it the bills are two different bills. Even if the Senate Passes then its going to go to a compromise is it really going to happen by year end i think youre seeing the market take a breather as a result. I think partly because yesterday was, my since, it was overdone yesterday, right it kind of the momentum caught up to it. I think it pushed it a little too far. Im not surprised at all to see kind of the Broader Market back off the way youre seeing it cole, you feel like theres a mania going on in certain sectors of this market, right . What are you looking at here well, i mean, you guys kind of touched on it when you talked about whos got cash out there to buy content and who has the willpower to want to do that that would be in the tech arena. In other words, if you want to get the highest price on content, you go to netflix because theyll spend more than anyone to a certain extent so that dynamic use etoday as a picture, there are the have nots catching a bid, someplaces lik retail and media today, and the markets not being benefited by that because theyre such a small portion of the overall market, it does not have a fundamental effect on the returns. Rick, it is kind of a headscratching day here the dollar moving lower, as we mentioned the russell moving higher, dow and s p weaker on the session. Oil which has had a horrible week is catching it sh. First down week in six weeks. Wow what do you make of it all, rick is. Well, you know, when you look at it, you nailed it down. 75 . Tenyear yields are down ten basis points we did get one positive, high yield did a turnaround wednesday, hit a low and bounced rather nicely and the spreads narrowed good data points todays Housing Starts and permits were good. National association of Home Builders index was frit good retail sales was cplus, bminus. But through all that, the markets acted as if the economy didnt matter. Maybe thats the point i found the yen rally most interesting today. There you have a central bank, you know, kind of like spring break, theyre just out of control. And yet their currencys getting stronger now, we could argue maybe its the carry trade, negative short end. No matter what it is, maybe it will impact some of their exporting, but at the end of the day, i think theres one thing we can be sure of, when it comes to equities, vix, hyg, most of the moves that scare investors seem to be short lived my final thought maybe on why the hyg high yield turn, you know, we continue to hear from the ecb and the watney, one of the ecb officials talking about theres going to be a higher percentage of corporates when they cut back on qe beginning in 2018 of course, 30 billion instead of 60 billion. Running out of government securities by default, corporates are going to make up a higher proportion thats maybe the moral of the story. The markets cant be held fwr r forever in many the distortions especially in corporates these are things that make us nervous. Certain Central Banks continue to make the matters more conf e confusing to the markets and kenny, i know you traders watched the russell a lot, those small caps en, i mean, thats showing some resilience this week after really lagging since early october. Are you taking any comfort from that at all . No, listen, i think the small caps and the russell, the stocks in the russell, they do sthand sfabd to stand to do better if we get tax reform russell still thinks its going to get it. The think the Broader Market is sitting there telling us not so fast one way or the other i think u. S. Americana, russell, midcap names are good places to be. Should be part of your portfolio. I think thats what youre seeing today cole, any names in retail or plead media you guys would be picking at here . Look at the lineup of the whos who. You got the roberts family, bob iger, the murdochs thats a john malonebacked discovery. The smartest people in media out there are out there consolidating the industry and whos sitting on the outside of this great content is all the Great Technology companies that want to do what the billionaires have done in the past, theyre watching this and no providing viacom sitting out there with assets, we dont own them but just the same, theres assets in that content and this is all a race for content. They have to fill the needs of the consumer and theres Certain Companies that are going to have that and certain ones that are not. All right very good. We have more content to produce here, ourselves. So were going do have to move on thank you, all three of you. Have a good weekend. See you later. Thanks. And weve got 47 minutes left there the trading session here as we already attemitemized slight down day for most of the major averages here after a pretty herky jerky week for the stock market. Still ahead, though, elon musk unveiling teslas line of electric semis the trucks that was last night in a highenergy presentation full of surprises as well and it appears at least some customers minds were blown as musk had promised. Well explain that coming up here. Plus, p g was dealt a major blow this week in its board seat battle with billionaire investor nelson peltz coming up, well speak to an exec from the nations largest Teachers Retirement Fund which supports peltz. Its that time again, were digging deep into the closing bell mailbag to read your comments about the show on air at the end of the program today. You still got time on twitter, facebook or over email. Well read the best a little later on youre watching cnbc, first in business worldwide you cant predict the market. But through good times and bad. At t. Rowe price. Weve helped our investors stay confident for over 75 years. Call us or your advisor. T. Rowe price. Invest with confidence. Welcome back have you seen shares of abercrombie and fitch today, up 27 after posting samestore sales growth after more than a year of declines the company said that its californiathemed hollister brand was a key revenue contributor for the quarter. Saw sales growth across all channels and geographies. Now i really feel its back to the 90s with them up, gap brands up yesterday. There you go. Talked about in this yesterday, walmart, cisco. Nelson peltz narrowly won a recount for a seat on Procter Gamble this week whats become the most expensive proxy fight in history for what these battles mean to investors, were joined by ann shaheen. Ann, welcome. Welcome back. Thank you nice to be here. You guys supported nelson peltz here, to read the way that you framed your philosophy, you say youre passive investors but active owners. What would oh, and im sorry, were just going to have to interrupt this for one second. We got to get over well come back to this after the White House Press briefing, we want to briefly listen in. The basic idea is that back when we increased our Corporate Tax rate from 34 to 35 , we were kind of in the middle of the pack of oecd nations subsequently what happened was the countries around the world found when they cut the Corporate Tax, their Economic Activity increased and the welfare of their workers improved then they very often did it again, typical country since our for economists what that does is gives us enormous amount of data to analyze because there are countries that change the rate and countries that dont you can compare the experiences of those two types of countries. Theres a big peerreviewed literature that looks at that, a paper by german economists thats about to come out in the American Economic review. We go through the papers, have charts, if this is true, what wage effect do you get most the action is well north of 4,000, thats where the number comes from ill go in the middle, the orange tie one of the criticisms, kevin, of the tax reform proposal is that the Corporate Tax rate is cut permanently, the individual tax rate phases out after ten years. Why, in your view, is that such a good idea . So the president supports permanent tax cuts for the middle class, permanent tax cuts for corporations and thats certainly the objective of the planners of this tax bill. But there are also, you know, Senate Budget rules and reconciliation rules that are required to allow this bill to move forward with 51 votes of course, the hope for everybody is that, you know, when the time comes for these things to expire, that they get extended as happened, you know, i might add, even for the top marginal rate when president obama came into office and extended most of the bush tax cuts, but even the top rate at the beginning, which interestingly, they must have done because they knew if you were to increase the top marginal tax rate during a recession, that it would be very harmful for the economy. So back then, there was bipartisan support for the idea that you should not lift the top marginal rate so there should be bipartisan support there would be Economic Growth effects of bringing it down right flow ill go back down into the middle there hi. One america news the two bills are different in that the house bill repeals or does away with the estate tax and the senate doesnt and i know that was a big point for the administration and Vice President pence has voiced his support for repealing the death tax. As they call it. What are your thoughts on that do you think a final bill will include a repeal of it i think that, again, thats one of the things that the senate and the house are working out. I know that the president very strongly favors the e liliminatn of the death tax and if that is in the final bill, im sure that hell be happy about that, but hes listed his nonnegotiables and those nonnegotiables i cited at the beginning ill go back to the far back now. Thank you, kevin, i appreciate it. Can you talk about the moment earlier in the week at the wall street journal event, gary cohn was on stage, the moderator asked a group of ceos if tax reform passes, who here is going to increase their investment only a couple of hands went up in the room. Gary cohn said why arent there more hands going up . Can you answer that question why arent there more lands goi hands going up in a room like that is the administration missing something there . So thats a great question. I went on a little bit after gary cohn and when they asked that question, it was kind of hard for me, like here, there are really bright lights, even brighter there i couldnt quite see how many hands were there when i was there, it looked like maybe half the hands went up i think if you go back and look, that it could be that people had time to think about it, but as an economist, if i go back and look at the academic literature, very often People Survey cfos and say, hey, if we change the tax code, would you guys do dmig they tend to always answer no. In surveys if you look at the hard evidence object what th about what they do, imagine if they didnt respond to taxes, they wouldnt be pursuing their fiduciary duty it would be irrational for them do that. Firms that did act rationally would put them out of business by taking advantage of the tax code the point is, hard evidence is that people do respond in fact, one of my very, very first papers i ever wrote when i got out of grad school is in the brookings paper, we look at the 1986 tax act, changes it made to the business tax code, how it affected business. Right here in the front. Gene sperling who was once in your position in another Administration Says that this tax plan, be it historic, costs 1. 5 trillion. And its a deficit he says basically this is in a tweet, just paraphrasing his tweet, he says it basically doesnt justify that cost for 100 million households for a tax increase. Well, you know, i respect gene a great deal and consider him a friend i disagree with him about that im sure well at some point have a chance to talk about that heres the way i think about it, what i would say to gene if he was here if you look at the joint Tax Committee score, in the tenth year they say the tax bill costs 170 billion look at the cbo projection of gdp, in the tenth year gdp is 28 trillion the amount of deficit youre talking relative to gdp in the tenth year some. 6 . Doesnt take a heck of a lot of Economic Growth to cover the hole by the tenth year so the idea that right now we have the highest Corporate Tax on earth, generating almost no revenue because people avoid the tax by moving factories to ireland, that if we fix that, if we p repair it, make the u. S. An attractive place again, its going to blow a hole in the deficit, its not economically rational i know the joint Tax Committee score says what it says. I respect the professionals s n that staff the fact is the oecd has a study which wed be happy to email you that says the u. S. In the Corporate Tax space is on the wrong side of the curve, we have such a high Corporate Tax rates, were chasing business offshore and losing ref flew. T ref flvenu revenue. Purple tie i want to pick up where john in front of me left off, he asked about the phaseout on the individual side. Youre an economist. However, the two answers you gave were both political one, theres reconciliation rules. And two, hopefully politicians down the lines solve it. Like i mentioned, youre an economist. Can you not make an economic argument as to why this is good economically for people . Oh, is it good for things to expire right. That economic argument as to why this is good for the country as it stands right now to expire within eight years or so. If you lower plarn ee eer ma rates, lower the base, give middle class a tax cut, if you cut the corporate rate, do any of those things, theyre positive for Economic Growth and less positive for growth if they expire expensing is kind of a strange thing in the sense if you have expensing for a year, if you go back and look at u. S. History, very often in recessions theyll put in expensing for a year to try to stimulate the economy when expensing expires, it can actually have a shortrun stimulus because people try to buy capital before the thing goes away. For the most part, permanent tax cuts are far more impactful than things that expire which is why if you go back and look at the president obaobama administratiy were leer during the beginning of the great recession, they even extended the bush tax cuts at the top because they understood this. Right, can i go right here then ill come to you then that might be the last one because sarahs standing here. I actually want to followup on that. You all made a value judgment to make the Corporate Tax cuts permanent and make the individual tax cuts expire even though you want all them to be permanent. Whats the rationale for having corporations have the certainty, they dont have to worry about whats going to happen in washington while families are going to have to worry about what politicians do six, seven years now. Sure. Those are the kind of things that are being worked out by congress in order to create a bill that underset in house rules can become law and the nonnegotiables for us are both met in both bills and we consider that good news, but, you know, the choices that the senate has to make in order to acquire a coalition to make this law are choices that the senate has to make. And we dont want to get in front of that process. One way or the other, whether Corporate Tax cuts i think tax cuts that are permanent, of course, will have larger positive effects. Ill give you the last kevin, youve melded politics and economics here quite successfully and i want to ask you a political and economic question. Youve talked about growth covering what the congressional budget office, could be a deficit hole, deficit implication of 1. 5 billion. That is going to be more shl ov measurable over time dynamic scoring or scoring answers that question. Since its on the mind of your undecided republican senators, is this administration willing to commit to a review five years in to see if the growth models have held along your lines and the deficit implications arent as large or if they arent, to preassess these tax cuts in order to not to blow a hole in the deficit . You know, i have not discussed with the president , i dont think sarah has, what were willing to commit to in terms of what we do five years from now let me talk what about we can be clear about today. Which is that as the president came into office, you know, the president s opponents were s saying that 2 growth was inevitable, we were stuck in a secular stagnation, that the president s policies couldnt deliver 3 growth and it was a cockamamy idea to assert it. Weve had two quarters in a row, 3 growth, if you look at the fourthquarter data, its suggesting the atlantic fed they have gdp now which is about 3. 2 as of yesterday so its saying were growing at 3 . If we take that momentum into next year add a tax cut, then were quite confident one should be able to expect sustained growth at that level or above. And with that, i think i have is to hand it back to sarah thank you so much for being so gracious with your questions thanks, kevin. Kevin hassett there making a surprise visit to the White House Press briefing today thats why we had to break in there. I want to bring ann back, director of Corporate Governance at calstrs thank you for your patience. Apologize for the interruption there. Thats okay. Im curious how calstrs is reviewing the tax reform package, those corporations that presumably would benefit from the Corporate Tax cut to 20 and repatriation tax thats being talked art eed about as well. Well, with a portfolio our size, we are watching closely whats going on in washington. Until we really see the final pieces of the tax bill and whats in it, were going to sort reserve judgment and not speculate on what the impact will be. Okay. I thought you might say that. Anne, lets get back to, if we can, for a moment, we mentioned your support of nelson peltz who won the board seat, looks like won the board seat this week at Procter Gamble. Your support for him is notewort noteworthy should activist investors whether they want to get involved at ge or other places know calstrs is going to be in their corner we support activist investors. Theyre not always correct in terms of they thesis we do agree nelson deserves a seat in the boardroom at p g we did support him and the preliminary certification by the independent vote tabulator has said that he did win that board seat so i think upon the final certification, p g should seat him in the boardroom so we are supportive of a number of activists i think they play a positive role in the capital markets. They help generate enhanced shareholder return for us, and we have been supportive of nelson and others like him because in the instance of Procter Gamble, the scouting report was it was too much of a closed society, they werent listening to outside voices. Is that the feeling there, is that generally with what youre looking for when you support activist investors we do we think someone like nelson would bring a fresh perspective to the board proroom at p g they have had a lot of insiders there, done well over the years. I think bringing a fresh set of eyes and a new start there would be beneficial to shareholders. And thats what we look at when we support activists in their campaigns. Sometimes a company can become a bit too complacent and so having a new set of eyes, a new way to look at these things can bring a fresh prospective into the boardroom. We want someone in there whos representing the shareholders, not just the shareholders inside the boardroom but also the shareholders outside the boardroom. Thats why we are supportive of a number of these activists. Anne, do you guys own General Electric at calstrs . Yes, we do, we have a large portfolio. We have about 8,000 companies. As your colleague said, we are a passive investor, but an active owner. So ge is in our portfolio. We are hopeful with the plan that John Flannery has laid out. I think it will be beneficial to have ed garden in the boardroom there. Theyre making changes to the board. 18 was a rather large unwieldy board. So going down to 12 i think will be very beneficial and they can really focus on what needs to be done to bring ge back to the Great Company that it once was anne, appreciate your time. Thanks for your patience again thanks so much. Byebye. You bet day have a lot to keep track of yes, they do. I dont know how they sleep nights. Time for a cnbc news update. Lets get over to sue herera. Hello, guys a north korean envoy to the u. N. Ruling out any negotiations with the u. S. As long as the u. S. Continues to hold joint military exercises with south korea he says pyongyang will continue its Weapons Program as a deterrent against a u. S. Nuclear threat as long as theres continuing hostile policy against my country by u. S. , and as long as theyre continued in the war games at our doorsteps, then there will not be negotiations the u. S. And serbian paratroopers completing a four day joint exercise with a parachute drop outside belgrade. Serbias president and defense minister attending the demonstration along with the u. S. Ambassador to serbia. President trump hosting a collection of ncaa champion athletic squads at the white house. The president there he goes assumed a wrestling pose he hit a volleyball and joined in on a university of utah hand gesture. He also took part in a group prayer with oklahomas softball squad. Thats the news update at this hour kelly, bill, ill send it back downtown to you. Thank you, maam. Got it. Thank you, sue. See you later. See you next hour sue herera. Less than 30 minutes to go to the close bifurcation today. The s p down five, nasdaq down eight. The russell is hanging on to a sixpoint gain. Koun,coming up, taxes have n top of mind this week. Negotiators from mexico, u. S. And canada are meeting in mexico city today for round five of the nafta renegotiations a pact which President Trump has called, quote, the worst trail deal in history. Just ahead, well talk to our larry kudlow about his take on mr. Trumps trade agenda and it may surprise you whether or not larry agrees with that trade agenda thats coming up your brain is an amazing thing. But as you get older, it naturally begins to change, causing a lack of sharpness, or even trouble with recall. Thankfully, the breakthrough in prevagen helps your brain and actually improves memory. The secret is an ingredient originally discovered. In jellyfish. In clinical trials, prevagen has been shown to improve shortterm memory. Prevagen. The name to remember. [ click ] [ keyboard clacking ] [ clacking continues ] good questions lead to good answers. Our advisors can help you find both. Talk to one today and see why were bullish on the future. Yours. Talk to one today and see why were bullish on the future. 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. Trade negotiators from the u. S. , canada and mexico today began round five of talks to renegotiate nafta. The north American Free trade agreement. Now, this is an agreement the president has called horrible. Naftas been a horrible deal for the united states. Its been very good for canada, its been very good for mexico, but its been horrible for the united states. And if you check my campaign, any of my speeches, i said ill either renegotiate or ill terminate. Joining us right now is mr. Larry kudlow, our senior contributor whos already begun the notes, the note taking there. The president came back from asia and it was clear that each at each stop, the America First mantra was repeated again and again do you agree with that im okay with the America First, and im okay with renegotiating trade deals that might get along or with china, they steal our intellectual Property Rights im fine with that im not fine with leaving nafta. Im not fine with saying we didnt benefit we benefited a lot from nafta. Now, the president and i over the past couple years have agreed to disagree on this subject. Nafta can be improved, but i will say this. If you pull the plug on nafta, even if its a negotiate you say, all right, were out of here, youre going to see very severe negative business consequences, and i believe stock market consequences. Even wilbur ross admits that the tax of renegotiating nafta is almost one way. Were asking for concessions, but weve got nothing to offer them in return here. Well, at the moment, thats a problem. A problem. And thats why i wanted to raise this issue there are a bunch of stories, the wall street journal, whatnot, last week stick with mexico for a second we did the deal with mexico, you know, reagan did it with canada, a few years later, clinton and gore gdid it with mexico democrats, to their credit they had a 5 , im going to call it a sales tax, on everything, domestic and international they said they would keep it at 5 they didnt. They took it to 11 then they took it to 16. I believe its still around 16 . Now, its not true that we dont we have, among our states, an average of 6. 5 sales tax which imports have to pay. Among the larger states, 9 , 10 . We got to have a meeting of the minds. On that point i agree with the president , always have if youre going to try to single out winners and losers, look, we couldnt disconnect from nafta if we wanted to. The supply chains are so close, youre talking just auto parts, agriculture, things of that sort yeah. Its Getting Technology th ta their allowi ing theyre allowing us to make investments in their oil field thats a good thing. If he walks away, well talk later, negotiating, art of the deal no too risky. Its going to send the wrong message, its a trade war message. Ive said to him many times dont do it, dont go there. What about we have to talk about developments on tax over the last couple days. Ah, heavenly. Heavenly. Heavenly. Beyond my own expectations heav heavenly i was telling evan, looks like i may win one. Evan newmark upstairs. My buddy. I love him so whats going to happen in the senate here . Youre past the house now. Which is big. Very big. Thats the easy part. What about the senate part i think it turned out easy. The senate is very close i know everyones picking at this and that. Theres a few things the senate has to do for better policy. Number one, the Corporate Tax cut to 20 , must go in immediately in 2018. How are they going to pay for it ah, youre asking me . You know what im going to say growth. They dont have to. Growth. Growth this thing is so underestimated on growth. Lets pretend the rules exist just for the sake of the how would they pay for it . I dont care about the rules. I have no interest look, you heard Kevin Hassett, friend of mine, he was my choice, not me, it was him you got to score this right and there are models that will come out that will score it right this things going to boost the economy better than 3 the other thing they got to do, though, this is senator ron johnsons issue, i believe he will eventually vote for it but hes making a plea, accretive core, where basically they should give the subchapter s passthrough, wholly owned proprietorships a bigger break the house made an improvement. Initially the house was going to pick winners and losers like a Manufacturing Company gets it but a Service Company does not. Right. The senate is changing that thats very important. Theyre going to win that and the senate is also providing a 17 deduction from income for the passthroughs so thats good its not good enough not good enough. Theyre still in the mid 30s it should be down around the mid 20s. I by the way, President Trump said he wants the top rate to come down to 35 boy, do i love that. All right. I love that more than i dislike the nafta problem. Im giving you more than we thought. Very quickly, the Senate Version makes the Corporate Tax cut permane permanent. Because of the byrd rule, the individual cuts would not be permanent. Right my first choice is why shouldnt it be the other way around my first choice is to totally ignore the bird rule i mean this. Nuclear option. The senate is not ignoring it. I dont know that well see. But second is, steve moore mentioned this to me, its a really good point, you got all these tax credits. Tax credits are not tax rate cuts but you got tax credits for families, tax credits for children i love children, dont get me wrong. Why dont you put them in and expire them in four, five years, knowing that it wont expire i mean, if youre scoring in static terms, fine. Why shouldnt they make the Corporate Tax temporary and the individual side permanent . No, no, no, no. The Corporate Tax is the big bang for growth. The Corporate Tax i think in it were temporary, companies would take more advantage of it, theyd go, we better do it right now. Its going to sunset. You know what, thats a faulty argument. We got to go. If you wait, everybody will wait, they wont pull the trigger. Thats the growth, and let me just say, the Corporate Tax and the expensing and repatriation, the biggest beneficiaries are middleincome wage earners all right. All right. And growth, and america wins. If we do this, im telling you before december 12th. Youre welcome. Thank you, youre both great. See you later thanks. Stitch fix, you hear that, it jumps 20 on the open this morning in its First Official day of trading but it has struggled since then its only 7up 9 cents does the company have a chance to turn the product and avoid the fate of blue apron a sp ndna which tumbled after going public this year . A debate coming up 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. Welcome back with tesla shares up 1 , elon musk unveiled a new sporty roadster along with an electric semitruck last night the orders are already coming in phil lebeau has them for us. Phil reporter and, kelly, we shouldnt be surprised that were already hearing from firms like walmart, or from jb hunt, that they are interested in having at least a few of the tesla electric semis heres the semi that they unveiled last flight and some of the pertinent statistics or specifications regarding the performance of that semi first of all, they say that it will have 20 lower cost than a comparable diesel semi there will be a cap on the charging rate. Wont go more than 7 cents per kilowatt hour. They guarantee that. They also guarantee that its performance will last at least for 1 million miles. And as we mentioned, walmart, one of those Companies Interested in at least testing out the electric semi. They have preordered 15 of those. Dont be surprised if we hear from other companies, other shipping companies, as well as Logistics Operations that at least want to see what the tesla semi is all about. As for the roadster, it certainly stole the show when everybody thought, thats nice, were going to hear about a truck tonight. Out of the back one of the trucks came, the tesla roadster. This comes in 2020 zero to 60 in 1. 9 seconds with a lange of 620 miles these are all World Records okay this is what were achieving in the prototype. I wouldnt say what the actual top speed is, but its above 250 Miles Per Hour reporter and the tesla fans who were in attendance last night, they loved it as youll take a look at shares of tesla, keep in mind this roadster is going to be a limited volume, highdollar vehicle. Were talking its probably going to sell for about 250,000 deposits will be 5,000 for those who want to put one down in act, you can already put on down if youd like the bottom line is this, kelly, while there are still a lot of questions about the economics of the tesla semi and whether or not it will truly revolutionize the Trucking Industry, it certainly is getting a lot of attention today and ive also aerd fr heard from people in the Trucking Industry saying, hmm, i want to see what its all about and whether or not it lives up to the hype. Elon plusk taking a page out of steve jobs play book thank you, phil. See you later. Personal Shopping Company stitch fix trading on the nasdaq for the first time today when we come back, a debate on this companys subscription box model. Is it enough of a revenue driver to shield fm itrothe Amazon Effect coming up. Lets begin. Yes or no . 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. Just told us that the market on close orders, big number, 1. 3 billion to the sell side, but that doesnt guarantee a huge selloff you could see some buyers come in to sop up some of the sell pressure right there well see. Were down 88 points on the dow right now. Shares of stitch fix volatile today to say the least after initially soaring in its trading debut on the nasdaq. It opened at 16. 90 after it prices its stock at 15 a share. I dont know if that qualifies as soaring. Theyll take it. Can the stock avoid the same fate of other subscriptionbased Companies Like blue apron . Joining us, liz dunn from proforma ryan payne from payne Capital Management welcome to you both. Liz, youre a bull on this company. I admit a im a little surprised. Me, too you like this . I like this company, the combination of data science, human judgment a Company Founded by a millennial woman whos cracked the code at getting women to get excited about shopping again if you look at some of their numbers, valuable of a customer over one year, over two years, its off the charts. This is a phenomenal company. You take the other side there . Problem with the valuation, worth roughly 1. 4 billion and lost 600,000 so far this year fundamentally, thats a real problem when you look at the stock valuation. Well, i would say that, you know, they dont theyre not set up to lose money forever, right . They invested this year. So they made money last year this year they ramped up adverti advertising, hired a bunch of people taking a business from zero to this over the course of six years is phenomenal. This is why im surprised you like it, i was reading, there are 2,000 companies that the do the same thing out there to varying degree s. Thats a lot of competition. It is a lot of competition. The company has a little bit of a competitive mote around the algorithms they built and continual feedback they get from their customers that makes their product better and better. You see them in numbers. More cust momering ar ins buyin first box and seeing consistent amounts of coming back to buy more boxes from the customers. Ryan, would that get you onboard at some point . I think the box subscriptions, the problem is its a novelty anecdotally, i know people who use the service, use it for a couple bhontmonths the algorithms arent as great as they claim they are and dont use it long term i think these are all big, big issues for the stock at least in the short term. So theres no valuation that would get you to move in on this thing . A lot lower than what it is today, bill. Liz, that is one of the criticisms is unlike an uber where once you educate somebody about using it, they use it again and again and again. Something like stitch fix, you have is to spend a lot to get them educated on it then that curve doesnt really have as steep a slope. Right, they ramp up, officialofficial initially they buy a lot then over time they trail off they continue to come back for more fixes you might need to initially stock your wardrobe then theres a lull you still are coming back for more fixes i heard a lot anecdotally as well the numbers bear it out. They got phenomenal numbers year in, year out, cohort after cohort, all of the years that theyve been in operation and im really impressed by them. All right well as we see, the stock is struggling to remain unchanged on its debut today thank you both. Taunk yhank you. Appreciate your thoughts on stitch fix today which is hard to say. Up next, we have the closing countdown with the dow down 87 points right after this. It is really lahard to say. Throughout my career, ive been fortunate enough to travel to many interesting places. Ive always wanted to create those experiences for others. With my advisors help along the way, its finally my turn to be the host. When you have the right Financial Advisor, life can be brilliant. Ameriprise letsfist word that comes to mind when you think of lowcost futures trading. Was it happy . What about a dedicated service team with futures licensed specialists . And what about being able to react to the 24hour futures market with integrated trading across web and mobile . Still happy . Good. Then its time for power etrade. The platform, price and service that gives you the edge you need. Etrade. The original place to invest online. Been a volatile week for the stock market show you fiveday chart of the dow. Started the week, bob pisani, each day almost with those selloffs then we came back that hasnt happened today, though, and we are finishing, what, slightly down for the week virtually unchanged here no surprise the best performer for the week inside the dow was walmart which traded like a faang stock this week. Yeah. Boy. The worst performer was General Electric after their turnaround plan fudded on wall street this week. Walmart the best comp numbers weve seen in years from them. Big, big number had their best day in ten years the other day. The twoyear note continued higher speaking of ten years. Thats the highest yield weve seen in ten years on the two year Wti Crude Oil despite a valiant rally today finished for the week down for the first time in six weeks. Its still u. S. Production against opec price still 5557 is still a high price. Can i just throw in a lot of Short Covering in retail today because the earnings numbers better than expected a lot of people were expecting retailers to go to zero. Obviously thats not happening look at these numbers here thats a real that is a Short Covering rally right there down 96 on the dow to finish out this week. The house passes tax reform, what about the senate . That and a lot more coming up on the next hour of the closing bell with kelly evans and company. Have a good weekend, kell. Thank you, bill, welcome to the closing bell, everybody, im kelly evans. The dow dropped 100 points on the bell there that gives us a decline all the way down to 23,358 for the blue clips today, that i are the worst performer shedding. 43 . The s p 500 to 2,578 the nasdaq down not as much. Still down a little bit. 6,872 is the level there the russell 2000 a. 40 increase, up about six points on the bell 1,492 for the small caps still 30 points off their record closing high from early october. 21st century fox trading higher today while comcast fell after news broke late yesterday it was interested in some Fox Properties the future of mega media mergers, if they can beat out the tech giant well get into that coming up. And the little noticed provision in both the senate and houses tax plans could have a big impact on Higher Education well have all of those details still to come a little bit later on. Joining me now, cnbc senior markets commemorator Michael Santoli along with cnbc contributor evan newmark on a friday anthony chen joins us as well, chief economist at chase welcome to everybody the biggest winner in the dow this week was walmart after yesterdays huge earnings gain while the biggest loser was ge with an 11 decline for the week ceo John Flannery increasing his stake in the Company Buying 60,000 shares. Over in the s p, the biggest winner this week certainly after todays jump was foot locker the biggest loser there, also ge and energy had its worst week in more than a year despite todays increase, despite xle down 3 after what had happen be a pretty decent string of runs there michael, what do you make of it all . I would say for today its actually very misleading to look at the big cap indexes to say what happened today. Equal stock, s p 500, up on the day, Overall Index equal weight in s p was higher today up on the day wow. The russell 2000 up more than im only just saying that because it really was a flattish day, in fact, if anything, a little bit positive under the surface. For the week, you had this 1 dip, 1 comeback, mini scare over not much of anything, except the high yield market got a little squirrely i think were back where we were essentially half a percent off the high from ten days ago and i do think its interesting, you mentioned all those groups, were not talking about faang really, not talking about the big Growth Stocks this week. It was about economically sensitive consumer oriented stocks one way or the other. Has your thinking changed at all about where we are the thing i found most interesting is what bill touched on at the close which is the twoyear yield i mean, you can buy a twoyear treasury right flow and get 1. 725 and go out another eight years and get another 60 basis points or go out another 28 years and i think you get another teensy yeah, get another 30 basis points on top of that. Which is if you think about it, you know, mike has enjoyed pointing out how wrong ive been about the bond market consistently for many years now. I do find it as an interesting phenomenon, i say to myself, if i have cash, which i do right flow, id rather be in a very, very shortduration money market or bond, really sortterm bond kind of are you ready to draw any inferences from that about the health of the economy or other things well, its you its a tail of you have a very Strong Equity market that is kind of pricing in tax cut or tax reform and relatively decent Economic Growth Going Forward and you have a bond market thats basically saying well be in a recession in the next year or two. Anthony, what do you think of that well, i dont think were going to have a recession in the next year or so. What i think the bond market is clearly telling you is the president has selected Jerome Powell and not John Taylor John taylor is well qualified but we know he has a model that says that right now the fed fund rate should be up 1. 8 higher than what it is right now. Im pretty confident Jerome Powell is not of that view, therefore, theres to reason for the Interest Rates, longterm Interest Rates to go higher in a world where the core Consumer Price deflator, excluding food and energy, is only rising by 1. 3 it simply isnt justified yet. Yeah, fair enough lets talk about some of these huge movers in retail today lot of earnings behind the action foot locker and abercrombie both up more than 20 after posting better than expected results this morning foot locker up 28 its best day since 1977 which i havent checked but i was wondering was just its ipo day who knows. Could be something close to that. Abercrombie fitch up 24 . Said hollister was strong. To me, if theres memories of the 90s. Were talking about it last fight. Could have been early 2000s when hollister launched but feels like a throwback. Gap, walmart, cisco this week you have to look at where these stocks came from where they came from, in this case of foot locker and Abercrombie Fitch is twice todays level. They were cut in half over six months or 18 months. I think what you had is signing that at least stability in the current results and maybe they have a shot at continued stability in terms of sales and traffic in the fourth quarter. Thats enough. People leaning against this whole group. And i think shorts on the run. The result of that is the Retail Sector as you can see having its best day since july evan, they werent alone it was gap which was up, shoe carniv carnival fossil, aeo. These are all heavily slort d shorted stocks if to you want look at the tale of the tape on a comparable stock, look at sears sears went over ten years, it went down from 150 down to where it is now. 6 bucks. Sears stopped investing in its stores a lot of these companies my point is, if you try to trade that, you were caught short, you were there were lots of days when you were down 10 , 15 you know, you were on the wrong side of a short squeeze. And you had a lot of things like that thats whats going im not saying thats not all thats going on William Sonoma is a much more heavily slorted stohorted stock abercrombie and foot locker and got pounded today. Not just about shorts were in this thing its art these companies, theres some value in the business it may not go much higher, may not have a sales comeback. Its not a zero. If its not going to zero in three months, it might be worth more today. My whole point is if youre a longterm investor and putting money to work in these stocks, you may have an up six months, may van up year, but the longterm trajectory of these smaller retail or apparel, its not good theres William Sonoma down 13. 5 today. We should check on stitch fix as well, that was an ipo that was sort of in retail. I guess thats the new retail model maybe. That was a disappointment, down from the 18 to 20 range. The ceo had to promise she wouldnt sell her shares to get this done. It did finish higher by 1 , mike, 15 and change the burden of proof is pretty high when it comes to investors buying ipos in new ecommerce models if anyones thinking about this as blue apron for clothes, theyre not going to have a good taste in mare mouth about it on the other hand, people lament the idea, oh, there are not that many ipos out there, the Companies Want to stay private these are the kinds of companies that come public have a Good Business idea, have tran traction could they grow from thereto you wa that to me the most eyeopening thing is the fact we had the most ipos globally since twec207 twothirds have been in asia thats where theres ipo activity, thats where theres excitement its not here right now. No, its not. The big change has been a company like this 25 or 30 years ago would not have gone public didnt have the track record, et cetera. Yes, you would, its got 1 billion in revenue it would be public im not so sure about that. Im not that sure. Lets talk about used to be many more 150 million those companies actually made profits. Yeah. There was a totally different its one thing if you made a lot, made a 10 margin on 100 million revenue run rate, that was a real company you could see growing. You make no profits on a 1 billion revenue, its a different model. Were about to talk about tesla. Thats promise analogous here. The shares are a little higher after the company unveiled its electric semitruck and roadster and has suitors waiting on the sidelines. Walmart plans to order 15 of the trucks jb hunt said it reserved multiple vehicles for the west coast. Didnt say exactly how many. The interesting thing to me, guys, was tesla wasnt even up 1 little less than thereat yes, they moved higher a little bit on the anticipation of this event. For such a dramatic announcement the way people are talking about how this is going to end jobs. This is motte the investors are not reading it as that. Its showbiz. Honestly nothing about this is going to make or break tesla. You know the brand value doesnt really carry as much in the commercial area. The stocks been laboring. It was a 390 stock twice this year. Wow. Its been laboring here as people kind of lose some patience, slowly, with the production delays on the model 3. Anthony, anything youd add to that . Certainly when you look at a company like tesla and they talked about the roadster, its going to go as much as 500 miles. They talk about the truck. Its not the 1,000 miles that the big trucks give you, but 500 miles is not bad by the way, this is the opening bid in this kind of an environment so it really tells you that in terms of innovation, tesla is on the go, on the leading edge it may not be there yet but its certainly out of the gate and a company you cannot ignore. Thats why i think tesla will continue to be exciting in the months and years ahead. Dont tell me, you own shares of tesla, anthony, in the home fund i dont believe that i do not. I didnt think so i didnt think so. That would have been a real surprise lets talk media for a second. Media startup buzzfeed saying its no longer on track to go public next year, at the same time mashable sold to zip datas for 50 million. Thats reportedly 20 of the companys latest valuation benchmark capitals bill gurley weighed in on startups and unicorns earlier today on squawk alley. Heres what he had to say. I do think were also watching, however, as many of the unicorns mature in age that many of them are having to come to the recognition that they either need to grow up, get profitable, go public, or do something along those lines. And this silly notion of were going to stay private forever is not playing out in a very positive way so to me, the Interesting Development this week is not so much what he was saying sort of the unicorns and so forth, its just Digital Media is facing a reckoning. And in a weird way for anyone who came from the wall street journal, you know, paid subscription world, its somewhat satisfying, ill be honest a lot of these platforms have tried to pivot to video and are not having a lot of success because it takes Huge Investment there. Is there a broader inference to draw about there was an era when these Digital Media platforms were the whole internet, basically, and now theyre not so much . I got one inference for the whole thing, henry did a very smart thing by selling Business Insider a year and a half ago, whatever it was. These things, they the idea that these things are scaleable into multibillion Dollar Enterprises i think in the the case of the huffington post, that didnt turn out to be the case, in the case of Business Insider, they got a really hefty price for Axel Springer its these these are tough, tough businesses to make work just because you need a lot of revenue. And if you do have the eyeballs, say, buzzfeed has, mike, or the distribution on facebook, whatever, ythey need the ad revenue tried to do the sponsored content, ultimately had to go to banner ads to grow it. The revenues going to miss. Now theres questions about the ipo. Theres just not enough to go around outside of the facebook and google platforms really the lesson. Saying not enough. People can kind of feed off of it. Shouldnt facebook be distributing all thisDigital Media content . Sure, absolutely. Its not shared equally. Yeah, its not think about what buzzfeed is and the promise of buzzfeed. It was not really as a news site it was as were going to prove how to create viral something and advertisers will pay us to do that. Thats what they do as well. So they are a piece of how people are acquiring, you know, eyeballs through digital means. Yeah. Again, its just a matter of they had to downscale what maybe its ultimately worth. I feel like theres been a change here. If youre a renter, you probably hear all the time youre throwing your money away, that you are doing that by renting, you should buy instead. But in fact, that may not be the best advice. Diana olick has a little more on that diana . Reporter well, kelly, i know youre going to yell at me because you just bought a house, right . What if i said that owning a home and living in that same home is not the best way to grow your wealth . Im not saying that. Thats the finding of economists at three different universities who collaborated on a study of Home Ownership they found that households can make more money investing in stocks and bonds than they can buying a home paying the mortgage and waiting for the home value to appreciate so, yes, owning a home is historically a safe place to hold your money, but not to grow it now, of course, all real estate is local price volatility varies market to market. So the researchers matched local markets with comparably volatile investment portfolios. The portfolios still won the one caveat here, for this comparison to work, the renter must invest the savings from renting into stocks and bonds. So if im saving 100 bucks a month by renting compared to the monthly cost of owning, i cant go out and spend that on Something Like shoes i have to invest it. And remember, owning a home means insurance, property taxes and everything that leaks and breaks and now that the tax breaks that make Home Ownership enticing are at risk in the republican tax plan, its all making renting more attractive. Of course the other side is you cant always renovate a rental which kelly, we all know, is the only reason to buy a house in the end. Yeah. Im changing my mind after the last couple weeks. But diana, thank you diana olick. Anthony, what do you think i mean, the big caveat is this notion youre going to invest what do you think about this, last word, before we go. Clearly, diana olick is spoton with her report because the caseshiller index is rising at about 6 pace on a year over year basis s p 500, up 15. 2 on a year to year basis emerging markets, up 30 on a year to date basis go to europe, the euro stock 600 is up about 6. 5 and the euro is up more than 10 , about 12 on a year to date basis quo got to add the two so, again, when you add up those two, clearly outperforming you also know that the subsidies that we get at the federal level that amount to something close to about 80 being 0 billion a thats going to be whittled away over time. Even though right now Housing Inventory is 12 lower than it was last year, were going to continue to see housing prices appreciate, guess what, over the next couple years as you start to see these subsidies being taken away, youre not going to see the huge spread between the Consumer Price index and the caseshiller index thats going tole compress over time making rentals just a little bit more attractive, but its not just about the rates of return, its happiness you get out of owning a house so i dont just look at the rate of return. Its a personal use asset anthony, thank you very much have a great weekend anthony chan of chase. 21st century fox shares surging after comcast became the latest media giant to approach it about buying asset. Up next, well discuss whether any of these possible suitors would be able to get a deal approved by regulators. Louse leaders s. Ahead, weal explain why the bill could be costly for employees and students at universities and millions of people who take out student loans. And we want to hear from you, share your thought with us, you got twitter, facebook, even e email closingbell nbcuni. Com youre watching cnbc, first in business worldwide media stocks in focus bigtime this week shares of 21st century fox higher today after sources say comcast held talks to buy major assets closed higher more than 6 as they try to push for scale, can Media Companies get big enough to win against tech giants like amazon and google . Iac chair barry diller sounded off this week earlier on this on power lunch. I dont think having more content is going to get you more revenue or, in fact, the idea of s saying, well size and scale. The truth is they all have kind of sufficient scales to be able to play. What theyll never have again is sufficient scale to dominate the Media Business as they have historically thats over. Because of the dominance of the tech giants now. Because, absolutely so will the Companies Run into regulatory pushback the media wants as they try to assemble some size here . Joining us, Barton Crockett from b riley fbr who raised his target on 21ings century fox to 36 bucks a share jonathan chaplain from Newstreet Research whos here on set with us ing with to both of you. Barton, first of all, why 36 bucks for fox . I think that you have to assume that theres a takeout breakup opportunity underneath the stock. You know, i think that disney might or might not, you know, the other people might or might not. The think the market is going to tend to put the breakup into th stock. Why fight it the premium value for their Great International assets particularly star, and their film library which is very valuable, i think, for people speaking a lot of great legacy content. So, you know, i think that its hard to say that the stock should be worth less than that at this point. Jonathan, if we didnt have word that the doj was maybe looking to stop at t and time warner, feels like this conversation, maybe the share price reaction would be very different, everyone would just assume maybe you can just amass size at this point then verizon was even reportedly one of the companies kicking the tires at 21st century fox. So you think those kinds of deals are going to be able to get done here . As a starting point, kelly, i think the at t time warner deal is going to get done its obviously facing a tough regulatory process right now i think theres a good chance that the doj ends up filing a suit, but if they do, the odds of at t winning in court are really, really good. Right. Its going to be really, really tough for the doj to win in court blocking a vertical deal. Yeah. Last 23 deals, vertical deals theyve tried to block, theyve lost 20 of those cases so that if that is going to happen, then, it would be a green light for verizon maybe to look at it and say, okay, we need to do something similar, right . So all of the vertical deals that would be at issue here, so verizon taking a look at 21st century fox shouldnt be an issue at all in the case of disney and comcast, theres a horizontal element. I dont think theres enough market concentration between the disney assets and fox, or the comcast assets and fox to create a real competitive problem so i think those deals would probably get through as well in an environment where we just dont know whats going to happen with at t, we think theres an 80 chance at t is going to win in court. Theres still a very meaningful chance that they dont its surprising to me that these talks are getting the currency that they are. Particularly for somebody like comcast who tends to be pretty conservative from a regulatory perspective. This week indicated maybe the comcast example was not one implicitly saying we cant allow a merge earn then try to have behavior enforced after the fact so clearly, look, i think its one of those deals with once it was reported that disney had made an approach to fox and maybe there was reseptembceptiio selling assets, behooves them to look and consider what they might want to do in that environment. To me, it makes sen t s sense t are happening but doesnt necessarily mean its priority number one for each of the Big Companies. Barton,vy a question for you, how do you actually create value here say somebody like disney buys foxs assets theyre just other assets. Are there sinany synergies here or Media Companies wanting to get bigger for their sake especially in a world thats going to skinny bundles and the rest of that. I think theres meaningful synergy if you combine content with pipes at t time warner, their pitch is ad tech. I think thats whats kind of happened generationally. Is if the regulators allow it, i think jonathans right, the courts will force this if whatever the Justice Department does, that youll kind of see Cable Companies and Wireless Companies together, content attached to that the triple play becomes a quad play, becomes the quintuple play exclusive content with pipes you can get in innovation and advertising, exclusive content to drive subscriptions so you monetize it differently i think thats one of the three or four kind of 20 to 30 subscription packages people will generally get in a generation thats where were going i think that people are bulking up for that future Barton Crockett, jonathan chaplain, thank you both. Thanks. Trying to navigate this new future. President trump recently declared the nations Opioid Crisis a Public Health emergency. Up next, well look at the companies trying to develop a new class of pain medicines that can help end that epidemic. Two new etfs betting against malls and brick and mortar evan, youll love this coming up, our takeaway, whether its the top of the malls and antimall sentiment. Some moments can change everything. You cant always predict them, but you can game plan for them. For 150 years, generations of families have chosen pacific life for retirement and Life Insurance solutions to help them reach their goals. Being ready for wherever life leads. Thats the power of pacific. Ask a Financial Advisor about pacific life. The fight against the nations Opioid Epidemic has seen some companies in the Health Care Industry trying to develop nonaddictive alternatives to opioid pain medications. Meg tirrell is here with those details. Reporter hey, kelly, scientific discoveries can come from some surprising places. In this case, it started with a hunt for families with inherited pain disorders we didnt know whether they would exist, but we made a bet that if they existed, if we could study them, they would teach us about important molecular players in pain. Reporter while it turns out that they do exist, and theyre extremely rare, steve pete, for example, is one of only a few dozen people known to have congenital insensitivity to pain hes 36 years old and he doesnt know what pain feels like. Meanwhile, reid and her family live every day with a pain so intense its been given the name man on fire syndrome both she and pete have mutations in the same gene it codes for a sodium channel thats key for regulating pain because it doesnt work in the brain, researchers suspect it could be a good target for new pain medicines that dont have the same side effects as opioids. Now work is under way on these medicines at half a dozen Drug Companies from amgen to biogen, regeneron. We all feel a sense of urgency. This Opioid Crisis, were living it right now. Reporter new drugs are still year away from the market. Hope is high they could provide good all tesrntives to millions of People Living with chronic pain kelly . Wow, theyre trying to get ahead of this, understandably. Meg, thank you very much. Thank you. Meg tirrell. Time for a cnbc flnews upda with sue herera. Sue . Hello, kelly, hello, everyone heres whats happening at this hour a group called women for roy moore gathering on the steps of alabamas capitol in support of the embattled gop senate candidate. Moores wife, kayla, was among the crowd and delivered an emotional speech in support of her husband. Let me set the record straight even after all the attacks against me, against my family, against the foundation, and now against my husband, he will not step down. A fouralarm blaze is engulfing a midrise Apartment Building in in new york city that blaze broke out on the top floor of a sixstory building on 114th street and broadway. Thats in manhattan. No injuries have been reported at this time e wi we just learned, though, 170 firefighters are on the scene. Danica patrick announcing she will retire from her fulltime racing career next year after competing in h the indianapolis 500 closing her career at the track that made her famous when no strong Sponsorship Opportunities surfaced for next year, she decided to call it a career thats the news update this hour kelly, ill send it back downtown to you. Have a great weekend, sue thank you very much. You, too. Our sue herera. Lets take a look at how we finished on wall street. The dow did close down 100 points there, basically tlahat a the lows on the nose as we closed things up s p down six or seven points nasdaq down ten. Russell managed to hang on to the sixpoint gain the equal weighted s p stock on average was higher. It was higher. Weird day in the markets. Lets get to other big stories today in our rapid recap. Elon musk taking to the stage last night unveiling teslas first ever electric truck. We designed the tesla truck to be like a bullet, so whereas a normal diesel truck is designed more like a barn, this is a bullet. Thats zero to 60 in 20 seconds fully loaded check this out this is the new tesla roadster zero to 60 in 1. 9 seconds. Comcast could be making a play for 21st century fox and verizon may also be showing some interest i think we were all shocked by the initial announcement which was on cnbc about murdoch potentially selling some of his content assets were going have the senate as soon as they get back from thanksgiving vote on the bill and our expectation it would go to conference right away and have every reason to think well get it to the president s desk before christmas for him to sign we are awaiting a big ipo, its stitch fix. The clothing Subscription Service. The stock has opened, it is up some 12. 5 at the moment. Trading close to 17 a share this is a business thats on a near billion dollar base weve been cash positive for years and had consistent profitability so this is a business that i think has proven in a lot of ways stitch fix closed right around that ipo price of 15. Time for the takeaway now. We begin today with the launch of two very of the moment etfs pro shares debuted empty in clicks, that is emty and clix. Empty called the decline of the retail store etf, literally its name, will rally when its index of traditional retail names declined clix is a long Online Platform type of play, includes alibaba, others, according to the wall street journal. Sign of the top . Top of etf marketing no, there already before. I think in conjunction with walmarts big rally yesterday, with the skepticism that evan portrays i dont have skepticism toward walmart. Also the abercrombie rally today. The lit fany of traditional retailers fighting back. I happen to think these are probably terrible investment vehicles theyre probably expensive i dont know the details of them these etfs are kind of expensive. Youre probably better off shorting a few names that you believe will not be around long term really, you think youre best shorting a few, just as if thats like no a low risk no, if your point of view is isnt it better to get short a basket, like not necessarily because right now, its very hard to say, you know what, like, a home depot, you know, there are plenty of online, rather, brick and mortar retailers like a home depot or a walmart that want to be here 20 or 30 years from now i dont im not sure abercrombie and fitch will be you want to borrow and trade, you know, five, you know, doomed, potentially doomed retailers, you think its cheaper than these etfs . Id be surprised i would say, one thing you have to know whenever you see cutsie new sector strategy type etfs, the reason they get created is a trade has been popular and hot for a while. For a while. Doesnt mean its over means its not new. Right its total sign that its become part of the market. It can be sold. Yes exactly. Heres another sign of the times, for all the talk about fed rate hikes, financial conditions in this country are at their loosest since 1994 according to the chicago fed does this a simply reflect the stock market rally this year, or b, the Federal Reserve should be a lot more aggressive even with the yield curve this flat i would say on a, not just the stock market, i mean, what goes into the Financial Conditions Index is stock and bond performance, credit conditions, but also volatility. So the fact its been so calm, very low volatility, implicitly means very loose financial conditions i dont think this in itself means the fed has to get that much more aggressive because you have to ask what are you defending against . Whats the poi point to the excess out there thats really dangerous. If they were raising and doing things with the Balance Sheet with the objective of tightening on the economy which i think they are, theyre not getting that theyre getting the opposite were the loosest in terms of financial is id be curious to talk to Jerome Powell or jay powell, right now, and say what do you think about the yield curve . Its not doing what they think it should be doing its not. Larry kudlows of the world will tell you maybe the fed shouldnt be raising as much at all. If you look at the natural conclusion of the dot matrix that they give you, would be that the long end should be much higher than it is right now. This is the way it often happens with a big lag i mean, from 04 to 2007, it was very slow, the long end was very slow to go up. Id also say they think of it as normalization. They dont think of it as trying to put out a fire in the economy and trying to keep it from overheating. Theyre in this phase right now where theyre saying, look, were just taking back some of the its interesting as they are taking it back, it has not had its a global its a global market. Thats fair thats wouchb tone of the is. This is my favorite tidbit of the day. Finally, heres a completely off the wall one, maybe its also a sign. Moviepass is at it again the company for a limited time is offering subscriptions for a year for 89. 95 which evens out to less than 8 a month. Versus its 10 plan right now that people already thought was a give away if people go to the movies once a month, it would seem to lose the company money. Theyre profiting off subscriber data apparently. What do you guys think of this i read thinks like like the internet, we get all the data, were good, were going to make money i dont understand the economics there. There are plenty of hedge funds who are happy to buy that data the user data plus they can advertise to you somehow or enable somebody to advertise to you honestly, though, i mean, look, theres a certain philosophy that says price it low, get scale, then maybe try to lift the price. Yes they have gotten scale 600,000plus people signed up. I dont consider that scale. By the way, that was the same idea behind groupon, and blue apron, its, you know, and zynga and the rest of those things didnt really work out for those i dont know about zynga. Farmville, people did digital farming, you know. I dont think that people dont go to the movies in the theater principally because they think its too expensivexpensiv. Its a habit thing, convenience thing. Even though it seems like it makes you money on paper to subscribe, i think theres another you know, you didnt like my zynga, you didnt like my zynga parallel. Didnt think it fit the basket. It probably doesnt. I think you like to say the name. We want your take on todays takeaway, facebook, twitter, ema email ill be reading some of the responses on air at the very end of the show. Coming up, the house tax bill already cuts out state and local Tax Deductions to help pay for it the bill will have a huge impact on College Student and University Employees well have those details in a moment. Later well look at whether Justice League can be the te superhero film to try to save the box office. Youre watching cnbc, first in business worldwide by taking money from foreign governments and threatening to shut down news organizations that report the truth. If that isnt a case for impeaching and removing a dangerous president , then what has our government become . Im tom steyer, and like you, im a citizen who knows its up to us to do something. Its why im funding this effort to raise our voices together and demand that elected officials take a stand on impeachment. A Republican Congress once impeached a president for far less. Yet today people in congress and his own administration know that this president is a clear and present danger whos mentally unstable and armed with nuclear weapons. And they do nothing. Join us and tell your member of congress that they have a moral responsibility to stop doing whats political and start doing whats right. Our country depends on it. 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. Whyour boss . Ork for . Yourself . Your family . Our Financial Advisors are free to realize a plan to fit your familys unique needs. Well listen. Well talk. Well plan. Baird. White House Counsel of economic advisers chair Kevin Hassett taking questions and talking taxes during todays press briefing at the white house. Eamon javers was there, joins us with the highlights. Eamon . Reporter yeah, hi, kelly, he came out and talked tax reform for a few minutes in the Briefing Room today. Had the opportunity to ask him about that somewhat awkward moment earlier in the week, you remember the moment at the wall street journal event which gary cohn was on stage representing the administration the moderator asking the ceos in the audience how many of them would increase investments in tax reform passed, and from the video it looked like only a few of the ceos raised their hands which is at odds with what the white house has been suggesting, which is that those ceos will invest if tax reform passes. I asked hassett about that heres what he said. When they asked that question, it was kind of hard for me, here, there are really bright lights but even brighter there. I couldnt quite see how many hands there were when i was there, it looked like plain half the hands went up and i think if you go back and look that it could be that people had time to think about it. Reporter so hassett there saying the lighting might have played a role in all of this and also half the people ultimately d did believe they would increase investment if tax reform passes. Also answered a couple other questions, interestingly, guys, though, he didnt really respond to a number of specific questions about how the white house feels about particular items inside this bill Sarah Huckabee sanders also came out and addressed the reporters in the room as well. She was asked a number of questions about specifics, also punting most of those to the house and Senate Negotiators this white house clearly taking a strategic position that they dont want to get involved in the details. They want to focus on the big picture. They want to get this done, they want the president to sign this bill kelly . Yeah, there were some good moment in that eamon, thank you very much. I like the one where he did the 3 gdp growth victory lap. Did you see who Kevin Hassett did the since weve been in office youre upset because they got one or two quarters im not upset, im simply saying they inherited theoretically the obama economy. Its been good for them and hes already doing victory laps even before if i were him, id do the same thing. While many families and businesses would see tax cuts, a large percentage of college undergrads and graduate students would see tax bills increase under the house plan at Research Universities like stanford and harvard, the new tax bills cut in half some graduate students stipends. The Senate Version so far leaves out Higher Education provisions in the house bill and retains education educationrelated tax credits like nontaxable annual grant that employers can offer their employees. For more on what this means, were joined we diane swan from ds economics thank you for being here. Good to be here it seems like the one that really could hit for a lot of graduate students, in particular, in the house bill, it means that they are going to waive the ability to not get taxed on the tuition grant that your cloej colleollege gives you if thats 40,000 a year, that would be a huge hit, right in addition to what youre earning as a Research Associate or a Research Assistant of about 20,000 a year all of a sudden youre paying a tax of, say, on 60,000 a year. Its really ridiculous having gone through graduate school, myself, with a lot of these things, i would have had to pay taxes when i was earning these things myself. I got through School Getting these kinds of things. Its really against what we want to do, that is invest in Human Capital and increase productivity especially, i mean, these people who have these kind of jobs that are tied to a ph. D. Grant are really working its labor i mean, theyre working a lot of lour hours, once you figure out how many hours theyre working, its oftentimes less than minimum wage. This, by the way, is in the house bill i dont think its in the senate bill, maybe they have the opportunity to react to that, make sure its not what about student loan, debt, diane . The deductibility, the tax credit for that would go away. Thats not a huge impact for feel financially, is is t, every year, what do you think is. Thats not as big what matters is what kind of tax rate you have, if you have a lower tax rate, of course, you dont mind not having deductibles as much. Thats supposed to be what the tradeoff is of these reforms i would argue is when i look at this and look at the really strange pay fors that we have in the house bill, and theres other odd pay fors in the senate bill, you start wondering, this is its still adding up to 1. 5 trillion, 2 trillion, adding to debt over the next ten years and you say, you know, thats going to sort of harness these kids that are currently there school with higher Interest Rates and higher debt burdens down the road. And its not clear that theyre going to get these benefits that they keep arguing out of it. There was the debate you referenced earlier, how much do Corporate Tax cuts actually turn into investment . I think there is an opportunity for Corporate Tax reform, i think we do need it. I think it needs to be done revenue neutral. Im disappointed theyre giving away an opportunity to do this right and messing it up by trying to run so quickly at it and not doing it deficit neutral, sort of adding to the debt it doesnt make any sense to me. Diane, i mean, underlying this is the process of coming up with, as you put it, pay fors. And theyre basically picking on groups that are politically quite vulnerable they dont control a lot of votes. Graduate students, easy to pick on graduate students. Yeah. Exactly. Easy to pick on residents of new york and new jersey. You think yeah, of course theyre democratic states. If youre a republican, theyre easy to pick on. Day already lost votes because of that. You think its easy to go after new york, new jersey yes, if youre a republican senator from im with kelly. I think the s. A. L. T. Stuff is a little harder for them to go after. But the pay fors, you know, its never easy took three years to get a bipartisan result in 1986. It was ten years in the making there was a public sense to it they actually went through all the process, they talked about it they had a sense of what the intended and unintended consequences are this is all sort of all ideology and not really thinking through it i just got back from washington. Amazed me how many republicans were against whats in the sort of detail, the dirt and detail of these two proposals and thats really frustrating theyre not even for it themselves and they dont want to add to the debt like what theyre going to be doing. I dont understand why theyre doing it this way. Except to get maybe a check of a win. Yeah. Made it through the house, but still a ways to go diane, thanks very much for joining us. Its a pretty tough climb in the senate yeah. Diane swonk from ds economics. As hollywoods latest big budget blowout Justice League hits theaters, media mergers abounds with talk on streaming well talk about what this all means for tinseltown coming up. Then ahead on fast money a top technician says one of the years hte tdeisotstras about to cool off. Hell reveal which one it is tonight. Every day, on every street, in every town, across america. Small businesses show their love to you. With some friendly advice, a genuine smile and a warm welcome they make your town. Well, your town. Thats why American Express is proud to be the Founding Partner of Small Business saturday. A day where you get to return that love, because shopping small makes a big difference. So, on november 25th get up, get out, and shop small. 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. 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 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. batman and wonder woman are back in theaters, this time along with aquaman, the flash, and cyborg evan, youll have to explain all this to me will Justice League bring in Good Box Office numbers . Well have a preview of the numbers after this i was playing golf days ago. Love golf. I used to love golf. Wait, what, what happened . I was having a good round, and then my friend, sheila, right as i was stepping into the tee box mentioned a tip a pro gave her. No. Yep. Did it help . It completely ruined my game. Well, the truth is, that advice was never meant for you. I like you. You want to show me your swing . Its too soon. Get advice thats right for you. Investment Management Services from td ameritrade. Warner brothers new movie Justice League opens two weeks after thor ragnarok hit theaters Julia Boorstin has more. Reporter warner bros. Hopes Justice League will turn around their fortunes. Its projected to gross about. 10 million this weekend but there are concerns about how the movie, which cost warner bros. 300 million to make reportedly, will hold up and how it will impact other dc comics movies in the work plus thor ragnarok has grossed 660 Million Worldwide in two weeks comcast is now currently in talks with fox about buying its entertainment assets the same assets disney is reportedly interested in, including its studio with the xmen franchise. New Sony Entertainment is interested in some of those assets well. Sony declined to comment a media merger would create a movie giant. Disney and Comcast Universal are in second and third place respectively, sony is in fifth place. With the box office suffering, studios have increasing focused on fewer, bigger franchises, the kind of sure things they know will perform globally like avatar. Kelly . Im just looking at the numbers here, julia, 21st century fox, theyre number four, thats better than paramount and lions gate. Yes lions gate is much smaller. The numbers move around year to year last year, disney was in first place in large part because of star wars. So there is some movement. But the big ones tend to be universal, universal, disney, and warner bros. And fox and sony are smaller than that well see how this one does thank you, very much, lijua boorstin were going to read some of your responses after this. O tax. Who could possibly be against that . Well, the National Debt is 20 trillion. As we keep adding to it, guess who pays the bill . Him. And her. And her. Congress, we should grow the economy. Not the debt. Another day at the office. Why do you put up with it . Believe it or not you actually like what you do. Even love it. And today, you can do things you never could before. Youre working in millions of places at once with iot sensors. Analyzing social data on the cloud to create new designs. And using blockchain to help prevent fraud. So get back to it and do the best work of your life. Allow you to take advantage of growth opportunities. And using blockchain to help prevent fraud. With a level of protection in down markets. So you can head into retirement with confidence. Brighthouse financial established by metlife. [ click ] [ keyboard clacking ] [ clacking continues ] good questions lead to good answers. Our advisors can help you find both. Talk to one today and see why were bullish on the future. Yours. It is time to close out the week with the closing bell mailbox. Jeffrey swede, original stitch fix was my mother, she always picked out all my clothes for me did you guys get that too, did they pick out clothes for you . No. But she had veto power my mother would just make comments like you pick it out eric reacts to the tesla electric truck, okay, whats next, an electric 747 . Musk is a charlatan, just say hey look what i can do, stock soars. I did like musks comment, they do the barnyard, we do the bullet you could see some pr person going, thats genius, elon, genius didnt we just do a story on electric jet engines in smaller planes. Sure. But at some point. This email directed to mike neal asks, how can anyone not be bothered by low employment, low Interest Rates, q e still in effect and no inflation . I dont think im particularly bothered, those things are mostly good until they sour into Something Else. Its the problem of, its too quiet, its too good to be true. I can handle it for about one second, aww. Thank you, c. Fried. That does it for closing bell. Fast money starts right now. Live from the Nasdaq Market site overlooking new york citys times square im melissa lee. Tonight on fast, media mayhem on wall street it sounds like Everyone Wants a piece of fox who should be the buyers traders have outside the box thoughts tesla unveiling a semi truck but what about the model 3 was musks presentation the ultimate bait and switch