Really hasnt changed from 2019. It is about technology, Communication Services the difficult decisions im trying to make when looking at my portfolio is how do i get alphabet into the port toportfo. Do i take out apple no. Which large name do i take out. Facebook is pushing right now towards its july 2018 alltime high id like to try and get involved in that in some capacity only thing potentially i could do is in the options market. So you are fully invested, you are watching it and understanding it is a technology story, Communication Services. That was the story of 19 and the story of 20 and all the talk about rotations and value, it is mega cap, big tech, it is faang and helping this run sure is we knew the consumer electronic show would provide a boost insights in to 5g and how important that will be that is clearly one of the big drivers for even from amd to apple to marvel. All of these stocks that are basically apple is not at ces, so being clear on that, but they are a beneficiary of everybody focussing in on 5g so id say that faangs continue to work. You could throw like joe said did you move out of some of these others, absolutely not with microsoft that and apple are two core holding the that you want to hold on to so id throw on just like you said, get some exposure with options. Again dow 20 points away from 29,000 lets bring in professor seeiio professor see segal. What do you make of this i remember at the end of 2017 and in january 18, do you remember that run up fomo, im not missing out on this i have high trigger when ill sell out and we saw the end of january, february of 2018 and im a little worried that this is becoming a momentum driven market at this point. You dont know how far it will go certainly no sign of a break right now. But i think that we have people jumping on the train here and are going to ride it on a narrow path until they feel that they have got some good gains. So you are worried that some of this exuberance could be getting irrational well, were fully valued. I mean the whole market is not like anything crazy. Were nowhere near 2000 or anything like that we have 20 times earnings on the s p in a low Interest Rate world that is fine certainly not cheap and more expensive than weve had dug almost all the last ten years. But i think right now i see that momentum play that is getting me a little worried again, long Term Investors, keep your positions but, you know, i dont see this sort of run, you know, continuing certainly throughout 2000 a20 and maybe nt through the quarter. Is it all about the fed, is it partly on fundamentals, a combination of both . Yeah, i mean i think that inactually the backing away of the risk this iran looks like maybe trump has a little credibility here he has actually moved up in the polls. Republicans have done a little bit better, that fear of that situation. The fed obviously reversing last october and open market purchases to, you know, eliminate any problem in the repo market. And the repo market has been very quiet they did year end perfectly. Liquidity is therefore back in the market and so you know, that is sort of the blue sky, hey, there is nothing to worry about now, im going to run this train as far as i can again, you know, these type of markets do generate into momentumdriven markets. You can have them on the down side as well as the up side. Something to keep your eye on. Im a little bit worried that if it continues much longer, that, you know, something will puncture it and people will get off the train. But again, long Term Investors should be okay with this market, short term trarsd if you have a tight range, you know, play this but as we saw what happened in january of 2018, boy, when i get off that train, you wow, it falls quickly. And professor, thanks for calling in i know you have to get to a lunch, but i appreciate you spending a few moments with us that is professor jeremy seigse. As the market extends the games beyond record territory, earnings numbers about to come down the pike, boy, they better be good. They have to meet expectations and expectations at a bare minimum correct but expectations have been very minor because weve had a year where earnings didnt glow row t all. So now were talking about what guidance will look like. So we have to meet expectations and management has to sound positive about the coming year they have to sound as if they can deliver because what the market is now assuming is that this 18 multiple is not going to go higher. And that we can live with 18 fine and maybe were looking at better earnings over the next 12 to 18 months so that 2021, it is really only 16 times that earnings level so i think that we are comfortable right now, no recession. We like where Interest Rates are, inflation is modest and so things are all appearing in line with trade, no war market is comfortable here but if we disappoint, if we see numbers that are below estimates, it can be a drop. And youre running a book of a few dozen stocks how are you feeling today . Im feeling like profession a professor seigel and less than two months it has taken, were talking about 29 k in the second week of january. And emotions are carrying the market up. Weve seen it before i think that you are right with the earnings and whatwe really need to be careful about is companies can meet earnings, but if their growth rates and pes are in the 30s and 40s, that could come down. So you have to be very specific about the companies that you own and you have to say visa and master card are fabulous, but they are trading at 30 plus multiples. And if they dont grow 10 plus, just using them as an example. So people have to be careful the market as a whole could still go up, but specifically in stocks i do want to make one more point and i agree long Term Investor shoes stay invested. But if your objectives are balanced portfolios, this is a time that you should look to see am i out of my equity allocation and do i need to pull back a lot of those investors are people who are retired or who have different objectives than a person who is 35 and 100 equity so if you are at 80 equity, you have to start pulling it back. Do you want to entertain the question of what is drivinging this and whether that makes the rally more fragile than not . If you are basing it all on the fed and there is a move or a misstep perceived by the market, maybe you are a little more fragile. Those are all great observations what is driving today specifically is that i think that it is still the relief rally that iran wont be a worse situation. But were up more than we were down from that as doc and i were talking about, china confirmed that they are coming here to sign the agreement. I dont think that was ever in doubt. You had job beleless claims go r there was fear that it would be higher adp was big right so i think what is driving it today mostly is the good Economic News and we had cherla clarida say that were fine to stay where we are. I loveire clarida say that were fine to stay where we are. I love hearing that people are worried. Im personally worried anytime that i can buy stock and it goes up, i feel smart when i feel really smart is when im worried. If january 18 is the worst that happens, bring it on so i dont want to be like one of these people that say everything can always go right all along because it cant do me a favor, well get back to this in a second. Let me go to phil lebeau with news on the boeing plane that crashed in iran. Reporter and nbc news citing senior u. S. Sources is now reporting that that Ukranian Airlines flight, the 737800 that was shot down predawn yesterday just outside of tehran, it was brought down by an Iranian Missile according to u. S. Sources who are talking with nbc news. I just talked with tom costello who covers aviation for nbc. He is saying that he has talked with sources who have confirmed for him that the belief is that it was Iranian Missiles that shot down the Ukranian Airlines 737800 killing 176 on board that is the reason that weve seen boeing shares moving higher within the last half hour. Scott, back to you you a horrible story. Appreciate the update. That is phil lebeau in chicago for us lets continue the conversation were having on the desk i mentioned expectations being ratcheted up, that shear number of 29 k makes you say where are we going, do we deserve to be here, can we go higher you look at some of the rice foe targets and we mentioned you how technology is driving this train, apples price target gets bumped today to 350 at jeffries. Alphabet goes to 1620. And amd, upgraded to a buy snap gets two upgrades this starts concern anybody i think that you will see that and especially that you will see that at the beginning of the year. I think that there is a lot of focus steve made a great point yesterday, he remarked that youre focused as a company on the company and the stock and there is a difference between the two. And a lot of these upgrades are focused on where is the stock price. Alphabet is a name that has been popularized a lot the last six months youre beginning to see the performance come around. I think it trades somewhere around a 30 pe again, i mentioned to me that is one that is interesting. Amd, it was up 150 i believe last year on a valuation basis and i dont pay much attention tole have a agts, bvaluation, b apple is maybe where the conversation should begin and maybe end. Stock crosses 310, alltime high it has been an unstoppable Freight Train the last year. And here we have price targets now at 350 it just is representative of how a narrative has changed about the entire market where stocks that have already done incredibly well that are widely held and even have i dont want to say questionable fundamentals, but declining earnings fundamentals. Okay and are still perceived to have that much runway in front of them look at this one, judge you saw no doubt this morning that they said between christmas and new years, apple did 1. 4 billion in the app store thousand, offer xwrbviously it e costs some money to run that app store, but they take a nice slice of everything bought just in one single day, new years day, people took down 388 million worth of stuff from the app store. So when you are saying yeah, iphone sales have slowed and we beat that horse pretty hard, but services and exactly what apple is getting from cloud and from the app stores and so forth i understand, but Earnings Growth 20 in that app store but overall, Earnings Growth, the rate is not what it was. But yet the stock is getting t stratospheric. Fedex has missed four quarters in a row. And so this year will be challenging. The stock is up 10 from its lows why should it be it is a product of the market and maybe optimism and i own it, i bought it back down there one thing that weve seen through 2019 until the end of the year was net selling there was a lot of selling individuals and mutual funds you kept in fedex. Sglf t of the market generally and december was the first month that you started to hear about some inflows it is possible that people are still playing catchup, that they were out of the market and the obvious place to go are the names that they know that have as much growth as there is in the economy, whether it is apple or facebook or google, you have to go if you are not in the market, go to what you know. And at some point apple is a better proxy for the market than it is for its own business and this is one of those points where i think that youve got more roxie in the market and some momentum from what the future holding and im referring specifically to 5g. I think it will be their biggest Product Launch of. So i give you the example of tech and then ill give you some examples from the financials and banks because cramer made today what i think is an incredibly smart comment. S setup is fthe setup for the b is the worst hes seen how can it be . Stocks have momentum, they have woken up and a number of the names continue to hit new highs. But therein lies the point these soctocks have run so much that the setup into earnings becomes precarious so to my earlier point, they better deliver the numbers because if they dont, byebye and he is right in the sense that the stocks have run and if you go back to 2018, a similar story, they ran up in terms of when rates were being cut and now we have the same story. What i feel that gives us some support of these banks and a city that trades at nine times earnings or a bank of america that trades at ten, you have some actually you have support in terms of valuation. And while i agree with him that if they dont come in as well, i dont see the down side as much on these as some of the high flyer tech stocks that are trading at 50, 60 times earnings i do think that the banks will do pretty well if the world is starting to improve as we see it is, europe is stabilizing, you see the u. S. Stabilizing and you have the opportunity there, i think that the banks can do well. You can be selective but you have citi, goldman, jpmorgan well do it as the call of the day. And i think it got cramer a little unsettled is citi being called the call of the decade or the bank of the decade or whatever. It was the pick of the decade. And we went from like a year ago everybody hating the banks to now everybody saying lets be in the banks so hes making the point that people are starting to chase this do you think the setup is equally bad in tech . Maybe worse. That is my point. That is the Umbrella Point to everything and here is where i disagree. I still think that the Fourth Quarter is not that important for earnings it will be the guidance that you mentioned before still a writeoff quarter because of everything that happened with trade, you know, because of the politics and everything. This is a writeoff quarter so you cant do Bed Bath Beyond and have a huge miss even though that will probably recover, but a slight miss is fine within the context of guidance being okay. Expectations for banks will be way more important. Because the yield curve has just begun to steepen. Joining us now on the phone, brian echbelsky is this market rational . Were feeling it again in the opposite direction with respect to how stocks have rallied in december and i think what people are missing, there was a point made that we started to see inflows in december and i think that if you take a look at a tracking year perspective, a lot of portfolios are underweight u. S. Stocks and i think that they missed the move clearly in september october. And then there is a bit of fomo, but i think that the key thing that not many people are talking about, i think that the secular trend of earnings being understated and und underpromised overdeliver, it will set the stage for valuations to not be as extended as most think. You have low Interest Rates. Fed will be on hold until after the election and that really sets the stage that we can see continued highs. Now, we had a 3400 target on the s p 500. Up side with respect to the s p is 3675. Weve been very clear that we think that were in the second half of a 20 year bull market. However, i do get a little concerned that the majority of my brethren are all of a sudden bullish after being bearish last year and near term basis, we love when stocks go up, but if everyone is jumping on board now, it gets me a little troubled but i do think that people have missed the move and were seeing a good Old Fashioned reallocation of capital back into the u. S is it fair to question whether were either knocking the door down, were banging on it but havent gone through a euphorialike feeling at this point . I mean from 28 to 29 k in less than two months. I think it is a great point, but i think that the stock that you need to continue to talk about is apple because apple, yes, is a proxy for the market, but the a proxy for sentiment. Apple has been used as a redemption tool for large cap portfolios number two, apple is the favorite stock for everybody to hate yeah, they have to own it but they are of a trade. This is about apples cash and they have more cash on the Balance Sheet than a lot of states in our country. And the mere fact that people are debating apple right here means that there is not euphoria in the market. And everybody and their mother, brother, sister, uncle, saying buy apple, that is when you have to start to worry. Wall street is almost saying that i just went through a whole bunch of upgrades whether it is price target bump to 350 for apple, citi called the pick of the decade, that is hyperbole that you just dont hear every day. Even some of the consumer names. Macys got an upgrade and it was a complete dog complete dog. And heres what i would say. Investors on the buy side use the sell side for Different Things some analysts are good at estimates, some are good at theme, some in the industry and some at stock picks. When you are investing, you use analysts for Different Reasons so i think that we as a society and media make way too much out of people making these picks like this. I think that you have to stick with the longer term type of vision and financials for instance. I note big call for bank of america, god bless you, that is fantastic fantastic. But guess what, themes are scaleable asset and commercial banking and wealth management. You cant throw all the banks into one bucket. Money centers are in a much better position. So that is the way we look at things are you worried about earnings season at all as we have all the upgrades going right into it . No, because especially in financials, there was a comment made that they are rallying into earnings earnings have been depressed the trend has been Underpromise Overdeliver and i think that we will see earnings accelerate and well start to hear about more of that especially coming into the send half of 2020 and nobody is talking about that i think the Fourth Quarter is a throw away quarter but it will be about revisions are going to continue to go up especially in financials, technology, Communication Services and parts of discretionary. No part of you thinks that it is a front loaded year because of a noticisy back half with the election no, lets face it, we cant continue on with this momentum it is gravity. And i think that well have as the primaries and caucuses start to heat up in february march, there will be a he rebeingreacto the market i think you stick with your core positions, but if you see that gravity, you have to protect your positions but be bum lillish longer appreciate the time, brian. Scott, i think what you saw a lot of folks doing from are the first time the embassy was attacked in iran by what we now know were iraqi sympathizers if not just straight out Iraqi Military coming across into help with that attack, ever since then, people have pulled back and they have had the money on the sidelines. But they didnt come back in and days like today and yesterday are the days when they did say, yeah, im coming back in because they thought that they would get a bit of a pullback a lot more than that he got. We talked yesterday about when the headlines were there, well, the 100 point selloff on monday is because of people worrying about iran no way if you are worried about iran, it is 1,000 points, not 100 points so folks just kind of held back and now i think that that hone is coming in now that is why some of this might be a fade. Im here as an apple shareholder listening to the conversation and one bangladeshing how much of a catalyst has passive investing been for apple you think about the weight of apple in the s p it is 4. T95 . You have to go back to 1999 so you have all these passive inflows coming into the market we know that they are there, overtaking active management they are buying apple by buying those indexes. You tell me the s p has gone up 5 , well, you Better Change your price target in apple from 309 up to 325 immediately. Because it will have the impact. That is why i say it is a proxy for the market but listen to the conversation owns it for cash so something to everybody there. So it is almost like panacea despite the fact you point out that earnings have been flat and will continue to be flat this year i wanted to point out something that is a truism for the past four years, the average decline, intra year, during the year, is about 14 . There is a drop. So the idea that the market will go straight up, we know that wont happen but this three quarters of the past four year, the market has finished up for the year so you can have this decline, but because we dont know when the decline might start, no reason to suddenly be bearish just because the market is higher plus if youve made money in the market like apple and if you are worried about it, are you going to pay taxes because it might drop 10 no and the dow got within about 20 points of 29 k. 69, 70 points now away from that milestone. There it is, green across the board. A strong day for stocks. Maybe historic one coming up, are investment committees making big moves . Plus unusual activity with john with oig, t so what are you working on . Im searching for info on options trading, and look, it feels like im just wasting time. Wasted time is wasted opportunity. Exactly. Thats why Td Ameritrade designed a firstofitskind, personalized education center. See, you just oh, this is easy. Yeah, and thats oh, just what i need. Courses on options trading, webcasts, tutorials. Yeah. Their awardwinning content is tailored to fit your investing goals and interests. And it learns with you, so as you become smarter, so do its recommendations. So its like my streaming service. Well exactly. Well except now, youre binge learning. Oh, i like that. Thank you, i just came up with that. Youre funny. Learn fast with the Td Ameritrade education center. Call 8662967451 or visit tdameritrade. Com learn. Get started today, and for a limited time, get up to 800 when you open and fund an account. Thats 8662967451, or tdameritrade. Com learn. Looking to get your business off to a fast start in the new year . Its go time switch to comcast business and get fast internet on the nations largest gigspeed network. Plus, complete reliability with 4g lte backup. And, cloudbased security to help protect the devices on your network. Greenlight your business in 2020 with fast internet and voice for 99. 99 per month. Act now, and get 1 year free of wifi pro. Call today. Comcast business. Beyond fast. Welcome back im here is what is happening at this hour. In her morning news conference, House Speaker nancy pelosi says the house of representatives will soon send the articles of impeachment on President Trump to the senate. No, im not holding them indefinitely ill send them over when im ready. And that will probably be soon we want to see what they are willing to do and the manner in which that they will do it and lebanese prosecutors issuing a travel ban for carlos ghosn and asked him to hand in his french passport. This following an interpol shued notice against him, the lawyer for ghosn seen arriving at Court Earlier today. Local media reporting that ghosn entered through a side door to avoid protestors and Justin Bieber revealing that he has been diagnosed with lyme disease he made the announcement on instagram after tmz reported the news he went on to say that he will have more details in his new documentary series that is set to debut a bit later this month. You are uptodate scott, back to you appreciate it and we have moves our traders are making today i want to run through those. So well trade more individual names. Carrie, you bought a former taranova name. Yeah, and weve been watching for quite a while. The stock came down about 30 . Had some slowdown, an accounting problem. We looked at it very carefully and it provides for communications, a back end platform that we think is the best we think that it has a lot of 30 Revenue Growth years ahead of it. Obviously they are not really earning money, but they will be earning. And we honestly think that this is a great entry point and surratt, pioneer . Yeah. And you did notice energy is the only sector in the red im making these long term bets just doing half percent positions to start you dont want to be the ones on the edge, you Want Companies that will make money at 40 bucks a barrel if it says 50 to 60, they have very disciplined management teams. Im not saying that you will get returns next six months to a year if i didnt get it them in the last year, why should i think i will get them in the year ahead these are value stocks. Value stocks might not move for a long time, but i think that you have a margin of safety on these stocks that i think even if oil drops to 40, they will do fine and joe, you bought more china. Yes, i did. Ive talked about exposure to the emerging markets and more specifically through the mchi to chinese equity shares. 40 of the etf is allocated toward technology. But i like the actions from the pboc if the actions of the Federal Reserve were enough to stimulate the bullish sentiment, i think that the pboc cutting reserve rate 50 basis points, that is enough do the same thing there i think that it is the beginning of a cycle it is not just a one and done and you are beginning to see an export demand coming out of that country. This is the way to play it 13 pe. It is cheap and 15 below the january of 2018 high so this leads me into a thought that goes back to the Broader Market and it is what belski and the professor and others have mentioned. The idea of fomo fear of missing out. That has probably been a driver. But for the first time i feel like in a year if not more, that there is no alternative doesnt really hold for me anymore because there are alternatives people think that there is better value outside the u. S joe thinks china is a good bet the professor talked about emerging markets granted on a day like this, you say what is he talking about, dow is about to hit 29 either today or the days ahead. But have we taken t. I. N. A. Off of the catalyst list there are alternatives that you should look at candidly, not me. I need to see real higher return in emerging markets because my risk is so much more there are issue, but opaqueness to the accounting particularly in china a lot of the markets like the european market, it is not cheaper. They have a different constitution to their market than we do they dont have the tech, they have more financials, more industrials. So the u. S. Market is the most transparent market in the world. Having said that, i do own a lot of it, but i dont think that you have to go elsewhere so if i can put up im not looking for another 30 like last year, but consistently double digit returns in the u. S. Market and sleep at night, id rather do it so rare when i agree with him, but i actually do you are absolutely right all our stocks are domiciled in the u. S. So you get the Global Growth if china and europe picks up, you can be in honeywell and microsoft and in Industrial Companies that will do well and you have the benefit of transparency, accounting, you have companies shepherding capital, you allow then hedge currency and we were on the doorstep of 29 k as we came on the air today and weve peeled about 80 points or so off of where we were because were about 100 points now away as we talked to professor seigel, you could say whatever you want, but he didnt sound like he was ready to commit any capital. Start running with the bulls. But isnt that good if he were and first of all, anybody that has been an investor for a long time, you know that you can walk in and market will be down 5 but it doesnt worry you id rather have it sooner rather than lately, but it will happen this year. Everyone comes on like mike wilson yesterday, everybody has that you gnawing sense that were moving too fast too quickly. And maybe we are so naturally it will correct and then you put some spare cash to work. I mentioned these upgrades that we got across many different sectors, whether tech or the banks and some of the consumer names sort of jokingly mentioned ma macys getting an xwrupgrade. Chipotle with an upgrade, wendys and starbucks called top picks. Mcdonalds price target goes to 250. And on and on. Well, that is a lot of not wanting to miss out. You have to have analysts who promote names in an environment where clearly investors are putting money to work. And so they are trying to give people the best options and whatever their ideas are the best this their sector, the best within the u. S. Market, i think that that is a reasonable thing do it doesnt mean though stocks are very attractive, they are certainly not as attractive as they were a few months ago but if you are the Consumer Staples analyst and you seat markfa see the market go un, what is t the best idea. But perhaps harder to find real value the longer the stock market continues to elevate. The Consumer Sector is where im highly concerned and i believe that there is a little bit of sentiment exhaustion. And ive been pairing back my holding of walmart im a nerve uts loous long in by a lot of the recent lift has been about the potential roll back of tariffs because 60 of their products are actually produced in china. So the consumer discretionary, the consumer staple sector, that is where i think that the exhaustion is, that is where i would look at positions very judiciously and be looking to roll back some of the longs i have coming up, jon is seeing bullish activity in Health Care Stocks stick around for his trades next and reminder, you can always watch us live on the go on the cnbc app listening and observing are Critical Skills for scientists at 3m. One of the products i helped develop was a softer, more secure diaper closure. As a mom, i knew it had to work. There were babies involved. And they werent saying much. I envisioned what its like for babies to have diapers around them. Thats what we do at 3m, we listen to people, even those who dont have a voice. At the end of the day, we are people helping people. Were committed to making college more affordable. , thats why were keeping our tuition the same through the year 2021. [woman] i knew snhu was the place for me when i saw how affordable it was. [narrator] find your degree at snhu. Edu. Apps except work. Rywhere. Why is that . Is it because people love filling out forms . Maybe they like checking with their supervisor to see how much Vacation Time they have. Or sending corporate their expense reports. Ill let you in on a little secret. They dont. By empowering employees to manage their own tasks, paycom frees you to focus on the business of business. To learn more, visit paycom. Com because its tailored to you . Take the personal assessment and get matched with a proven weight loss plan. Find out which customized plan can make losing weight easier for you myww join today with the ww triple play theres one thing you can be sure of. Theyre changing by the nanosecond. Thats why cognizant created a unique engineering approach to design and build new digital products. Learn how cognizant softvision designs experiences and engineers outcomes. Cool. Shares of exact sciences has already rallied horn y eied mor. And bullish traders are betting that it will go even higher. So take look at this. These guys and a number of the Health Care Stocks are moving probably because of the Jpmorgan Health care conference a lot of these react to that i saw merck with huge unusual activity today and this one with the stock just over 102, they boiing tuying th calls in january so a week and a half into the future again, i bought these. Ill be in it through that conference or at least through their presentation next week same thing over here with whole log logic. This one, they are buying the double nickle calls 55 calls with the stock at 53 i like this one as well. Obviously. Im in merck i added that one to the portfolio. This one, bigger volume, about 6500, 7,000 of those calls ill be in these thousand i want to give you a quick update and i do mean quick. First one, luckin coffee, this one look at that today 3. 50 to the up side he talked about it. Stock was 3w 43. Those calls are up like 500 bad side, take a look what i did, targa resources, because some of the oil and gas plays, energy plays are not doing so well today, this one i exited, lost 50 cents on the play. I paid a buck to these calls last week. Now im out of them for 50 cents. Lost 50 . Thats right. 50 or 50 cents. Both the same. 50 tells you the real story. There you go. All right straight ahead, the hunt for quality in yield, why it is not as safe as you think according too one investor, but first a check on the zch sectors we told you everything was in the green except for energy, but now Communications Services dipped in the red as well. That is taking some of the steam out of what was a strong rally on the doorstep of 29,000. Backed off a little bit. Dow at 28, 895 ke martin. An air force veteran made of doing whats right, not whats easy. So when a hailstorm hit, usaa reached out before he could even inspect the damage. Thats how you do it right. Usaa insurance is made just the way martipaid beforeneeds it t his neighbor even got started. Because doing right by our members, thats whats right. Usaa. What youre made of, were made for. Usaa looking to get your business off to a fast start in the new year . Its go time switch to comcast business and get fast internet on the nations largest gigspeed network. Plus, complete reliability with 4g lte backup. And, cloudbased security to help protect the devices on your network. Greenlight your business in 2020 with fast internet and voice for 99. 99 per month. Act now, and get 1 year free of wifi pro. Call today. Comcast business. Beyond fast. Im Brian Sullivan here is what is coming up on the exchange. What is the state of American Business right now ceo of the u. S. Chamber of commerce will join us to talk about if well ever get any kind of an infrastructure plan. Plus he played seven seasons with the broncos but it is what he is doing now off the field that he is call you willing a ga calling a game change. Terrell davis will join us live. And a big fail, a 58 million mortga mortgage and all ahead we are looking forward to that and when it comes to concerns about the rising level of corporate debt, much of those fears have centered around high yield bonds. But now one investor says top tier credit may not be as safe as you think Monica Erickson is joining us now. Nice to see you. Thank you good headline why not as safe . I think one of the risks that is not being talked about is the duration in the Investment Grade market historically maybe back up a bit. The Investment Grade market is a massive market, over 7 2r 7 2r o of debt outstanding. So i think it is important for investors to be focusing on the risks in that market in particular since it is done so well. Spreads have remained really tight. People say that is a sign that we dont need to worry about anything and i go back to calls over the last few years about high yields going to blow up and we havent seen that. So what kind of time frame are you talking about that we could see trouble . Well, i think that the trouble or maybe the thing that i would like to alert investors to is take a look at what the duration is in the market so it is the Interest Rate sensitivity that the asset class has to a change in Interest Rates. Or a change in the spread. And currently it is the longest it has been in history so not only is the setup difficult because valuations are stretched, you also have an asset class that has an extremely Long Duration so has a lot of volatility around Interest Rates and i think that is a part that investors are not focusing on. Do you think that investors are simply too complacent across the board when it comes to levels of corporate debt that is a different question i think. I think that the duration aspect is very specific to the volatility that could be introduced into the market because of changes this Interest Rates. And the idea that the market has grown as much and that corporate issuance has been heavy, i think that that is a different discussion but it is something that we are very hindfmindful of as well if the fed was to pause the repo prag repo operation, would that accelerate your concerns for duration i think the concern with duration is if Interest Rates go up, the rice price is going to o down so historically asset class has had about a six year duration. So 1 move in Interest Rates either way will move the asset class by about 6 . Right now it is 7. 6 years. So 1 move is going to move the asset price by 7. 6 . And weve had rates fluctuate in the ten year from about 188 right now, i think the high was about 320, so if you get a 1 move in the ten year, you could see this price drop in class. And i think that is what is missed in the discussion we talk a lot about credit risk, about issuance, about triple bs. There are definitely a lot of other risks in the market. But this duration aspect is one part that is i think not getting enough attention so im curious what you think about this it appears that in the last feww years, because Interest Rates have been so low, that Companies Like apple, who dont really need to borrow, borrow 7 billion. About buying these bonds, perhaps paying up for them and not worrying as much about the quality underneath because these qualities need some yield . Its like buying a treasury. Right there is an aspect to that, that issuers come into the market that clearly do not need the cash and i think apple is the best example of that. I think that im not sure that investors are complacent about that i think there has been a lot of discussion around concerns about credit quality, just the increase in the bbbs, increase in leverage in the space i wouldnt say that investors are complacent, but what i would say is that corporate entities have taken advantage of low rates and come to market borrowed and in addition borrowed longer because rates are so low that they extended out their maturities and, once again, pushing the duration of the asset class a little further out. Monica, we appreciate you being here today, on what is a busy day in the market. Yes. If you have questions, we have answers next in ask halftime, well do qualcomm, target, more straight ahead this is the age o. Everyone has something to say. But in a world full of talking, shouldnt somebody be listening . So. Lets talk. We are edward jones. With one Financial Advisor per office, were built for hearing whats important to you. One to one. Edward jones. Its time for investing to feel individual. Stay resthe new rx,the icon thatcrafted by lexus. Lease the 2020 rx 350 for 419 a month for 36 months. Experience amazing at your lexus dealer. All right. Welcome back q a. Joe, spence in florida, regarding your favorite stock, ulta, lol, is this a good entry point . That hurt no, not yet. Theyre working on you to make a move for a while. I got hammered on that one. That was ugly. Stock has rallied back to 270. Its 15 still below where it needs to be ceo mary dillon has been there since 2013, an absolute ceo. Theyve done a great job stock is up 1200 in the last decade i am not ready just yet to step back in. Serat, for you, david in new jersey, qualcomm, should i buy it i think so. They bought back a ton of shares this would be a good one. Doc, for you, occidental. Its up 20 in a month, judge. Thats six times what the dow is up in the last month i was lightening up. Im almost completely out of it. I will reload if it makes a significant correction. Ryan has a question for kari. Is it a buy . Good question. Salesforce has had such a sharp move that maybe it needs to pause for a minute. It underperformed for most of 2019, but its still the dominant player in a growing market and some of its competitors, quasi competitors are really giving up on it, like microsoft. So we like it, but perhaps wait before you really plunge. Lastly, from don on twitter, target what do you do with this name . Another one that surged, to say the least. Justifiably, based on fundamentals i still own it i love for it to come in a little more. I have faith in brian cornell. I wouldnt do more except buy more. Thanks for the answers. Better yet, thanks for the questions. Final trades are straight ahead. Legendary terrain in telluride, the unparalleled landscape of park city, or the famed peaks of whistler, youve faced the hassle of lugging your gear through the airport. With ship skis, youre just a few clicks away from having your skis, snowboard and luggage shipped from your doorstep to your destination. With unrivaled pricing, real time tracking ship skis delivers, hassle free. Ship ahead and go catch those first tracks on fresh snow. Ship skis. Your skis. Delivered. I can. The two words whispered at the start of every race. Every new job. And attempt to parallel park. electrical current buzzing each new draft of every novel. typing clicks the finishing touch on every masterpiece. newborn cries it is humanitys official twoword war cry. Words that move us all forward. The same two words that Capital Group believes have the power to improve lives. And that, for over 85 years, have inspired us to help people achieve their financial goals. Talk to your advisor or consultant for investment risks and information. Lets do final trades. Kari Silicon Valley is in a growth market, San Francisco area, california low multiple stock, long runway. Jeff . Levi straws ill be selling out of that position not going anywhere going to sell out of it. Lot of negativity going to the call theyve turned things around im a buyer. The doctor. Fy delity information services, 142. 50 stock. I like the action. The momentum will continue into their analyst day, their meeting. I think its a great story. Wonder if we make another run at 29k today goldman has been emblematic at move we see in the market certainly of late. Goldman has really had a surge wall street is coming around to it of the it seems every week. Could that be an apple play, to throw it out there, to get in with individuals if boeing would ever participate, dow would go a lot higher. It is today, my friend. Yes, it is. Dow is up shy of 180 well keep our eye on march to 29k. The exchange starts right now. Yes, it does, scott thank you. Stocks, you might have heard it, record highs and the state of the American Economy is good. Well talk to the head of the chamber of commerce. He once gig workers left alone and is begging for one big type of Government Spending well get to that. Plus nfl hall of Famer Terrell davis is here, his surprising super bowl champion pick and bed bath and bust. No more analyst replies and a 58 million mortgage can you imagine