Transcripts For CNBC Fast Money Halftime Report 20170203

Pressures on. Judge, the banks are going to bring it. And i think pete and perhaps josh earlier in the week were both talking about how the pause button was hit for the financials. Could have been you as well, steph. Do we just hit play again today . Yes, we did just hit play again today. And turned the volume up. Significantly higher for a whole host of reasons. Not the least of which this week we had a lot of chatter about regulation roll back. Weve had dodd frank. How many times. If we had a dime for every time they said dodd frank in the last 24 hours, we would be able to buy warren buffett. Josh said turn the volume up. Weve turned the volume down today on some of the ancillary noise and we have turned it up on ceos meeting at the white house. Dodd everything fra executive order expected today. Thank god. This exactly what i want this white house to be doing. Meeting with business leaders. I like what gary cohen said this morning on cnbc talking about this is a president that wants to hear about specific problems and how we would attack them and not big picture stuff where theres really no direction forward. I like to hear that. I dont agree, by the way, on what they want to do with dodd frank and the fiduciary rule. Regulations come in to play for a reason, typically after a crisis. It is a positive for the banks if they continue to talk this way, and starts with by the way, its important for the market. Keep many n. Mind the financials are 42 of the rise in the dow since the collection. And goldman alone is 25 . Goldman is a leader today. I think you need to continue to see that. Steph, is this the place you want to continue to buy . Financials are up 17 since the actual election. We had this big run, a pause. Now you get talk about dodd frank and you get a little restart. Yeah, weve been waiting to hear more details about less regulation, were waiting to hear more details about tax reform. Those two things are really big for financials. Really big for this overall rally in general. So we kind of need it this, i think, to get jumpstarted. Financials really have lagged since mid december. So im excited that its according to josh, its time. We waited for time, it wasnt price that corrected. The valuations are how do you like that . I love it. Valentine. The valuations are very attractive. And very supportive in terms of in the financials. So im excited about it. Im not that surprised that we got the news today. I like financials. Im going to stick with it. 260 points roughly was the selloff from last friday to the lows of this week, judge. And its not the we were wringing our hands but there were folks saying, oh, worst week under prurcesident trump, point selloff for a 20,000 point index, really . Now were right back up over 20,000. Really heres the dip and it was nothing. Like the Bowling Green massacre. But you get the point that there was suddenly a lot of focus away from the parts of the agenda that have led to this rally in the first place. We were talking about everything but regulation, taxes, and stimulative things for the economy and the market. Now were back in focus today. Whether its just the optics of the room, the state dining room, or what have you, were back to the message of the market. Yeah. And i think what were seeing this week out of companies and ill throw amazon into this as well, judge. I mean, krincredibly competitiv company, amazon. If i knew exactly when besos was going to cut back on cap x i would say buy the heck out of that company. Spending has picked up. They cut prices on some things. I thought that was a great quarter. Why is the dow plus 170 today . The jobs number was good. This has to do with the white house, too, doesnt it . I think so, for sure. Less regulation, tax. We just talked about it. I mean exactly whats happening in that room today. It could be. Certainly could be. I think the jobs number was very good. Very Encouraging Group add on all the other Economic Data we got this week, actually every piece of data this week was pretty good. I mean, especially on the job front. Now, the om bad thing was wages, right . That was disappointing today. So thats what we want to see actually improve going forward. I think you will. But thats like the one thing that kind of is worrisome to me. But i think the Economic Data, i think the fact that were going to get less regulation, the fact that were going to get lower taxes, add it all up this is why we rallied from the lows from when he was elected and now the momentum is just continuing. Speaking of momentum, dow back above 20,000. Now we want to bring in someone who believes the dow could hit 30,000 by the year 2025. Jeremy schwartz is the director of research at wisdom tree. Back with us today. Jeremy, good to see you. Thanks for having me. Given that you were the former Head Research assistant for jeremy siegel, i get maybe drinking some of his koolaid now im wondering if youre dumping the whole thing over your head. No, this article series that your talking about weve been doing this with gene epstein since 2009. The first article was march 9, 2009. You never get the timing right exactly but he came out with an article saying looking at the data, historical trends, the next five to ten years are likely to be better than average. Hes done five articles now, 11, 12, 13, 15, all spot on the money. He said by 2025. Be so all that requires is a 5 a year. Thats a very normal market. Its not anything so great. So its just saying, listen, the markets are normally valued. Theyre not extremely expensive. We think theres some positive things. But this is not like an outlandish call by any means. It implies a couple others things as well. Number one, this rally continues and that we dont have any kind of bear market in the interim. Well, not necessarily. I mean, saying by 2025 you can get to 30,000. So you could have a bear market in the interim but its just saying 5 a year compounded over that seven, eight years will get you there. Jeremy, its josh brown. Good to see you. So people tend to anchor to march 2009 and they use that create this narrative where, quote, weve come too far too fast is one of the things that you hear. And another thing you hear is this is the second biggest bull market ever or its the third longest in terms of duration. The problem with that, and id love to hear your thoughts on it. The problem with that is march 2009 is not relevant if we have a new secular bull market that began in the spring of 2013. Why are we anchored to the bottom of the previous secular bear market. Why cant people let that go and just focus on whats happening now . No, youre spot on, josh. Thats Behavioral Finance 101. People anchor to these thresh d thresholds. If you look at the long term, 200 years of data, if you look at the longterm trend, basically right on the longterm trend line. Gene epstein talks about the data since 1871. Youre at long term trend lines. The five and ten years are below historical averages. But i dont think youre acting very extended valuation. I think youre very normal valuations. The dow itself, last 12 months earning, 19 times. This years expected earnings, 17 times. The dow, you talked about Corporate Tax reform, the dow is more u. S. Centric than the s p 500 so theres estimates weve done saying if you get a reduction in taxes to trump said 15 , paul ryan says 20 , weve done some modeling to say what is the earning growth be for s p 500 around 7 1 2 if you go down to 25 . For the dow it could be 10 plus. So youre talking 15, 16 times on the dow. Which is a very normal market multiple. Its not so extended. Are you implying by saying this is an eight years, are you counting on a twoterm Trump Presidency and how much of this whole thing is predicated on his policy and agenda . I would say its not counted on trump at any means. The numbers there. Just lking at Historical Data and trends. Its not really trying to say anything about the current administration. Theyre saying if you look at the longterm data what are the odds that based on past return, based on valuations where are you in the cycle and youre not is the off an over extended place in the cycle that youre going to get much below average returns. Normal return cycle. 5 a year gets you to 30,000. No, but you dont take into consideration major changes in tax policy and regulation as any part of the number crunch . No, i mean, i think thats a very positive. I do think thats a very positive for the valuation. If you get Corporate Taxes that gives you an earnings boost that is positive. But this story there was just literally to focus and the past returns and what that means for the future. Jeremy, thank you for your time. Wisdom trees jeremy schwartz. Doc . When you look at it, judge, 2007, 14,000 in the dow. Using that as the metric rather than the s p. Fell obviously down almost 8,000 points to 6,000 and change. And now were back up to 20,000. So over that tenyear span, 14,000 with a dip, with a significant bear market, all the way back up to 20,000, you do the math on exactly as jeremy did, you come out with a number very close to what hes got, 30,000 or there abouts by 2025. So i dont think hes overshooting. You hold up a headline that says dow 30,000. Whoa. And then you go back and look at some of the metrics that they have. You say, okay, 5 a year over an eightyear period. And you might even get the rule of 72 instead of that 5 a year number. You get 7. 2 and you get the numbers higher faster. Another stock on the move today. Macys is higher on reports that it is in deal talks with hudsons bay. Lets bring in dana now, ceo of the Advisory Group for more on this story. Dana, its nice to speak with you today. Thank you for having me. Do you think this is real and do you think it makes sense . I think Overall Department stores have been in a tough spot. There are a few people or companies of the resources to do this. Is it real . When you have news like this come out its coming out over and over and obviously we know raeb results of macys is theyre working to transform themselves. Probably more real than not. Theresen enormous amount of time and dollars to go in and reimagine the Department Stores footprints and with the hundreds of properties they have you have to have a plan for each one. We saw when macys acquired mae over ten years ago it took a while. Basically got into the Department Store place by taking a by valuing real estate but that doesnt eliminate what happens on the top line. Top line struggle for Department Stores. They have some very valuable locations and i think theyre pruning underperforming stores. Theres more to do. How does macys get improved by this transaction on the top line, if at all . I think if anything youre going to have to are they going to still be used as a retailer or is it going to be used as Something Else inside the box . Are you going to monetize some of the real estate that you have there and what are you going to do to bring in different activities and experiences to drive the top line . Thats about the reimage nation. What are you going to do, put roller coasters inside macys if theyre owned by hudsons bay. Not roller coasters but beauty salons and appliances that others are putting in, gym equipment, food halls, restaurants. How do you get people to spend three hours a week at some of these malls and these Department Stores. Thats what everyone is focused on. Can gary storch do what Terry Lungren could not . I think overall its not a person doing it. We need new ideas and new events and activities. I think its every single Department Store Management Team and retail team looking at new ways to think about how to attract the consumer. Get the number of Instagram Likes on something and thats how you should be filling your space. Dana, hi, its stephanie. Hi. So question for you. If they do if macys sells out, is this an admission that Terry Lungren cant fix what he has . More to the question that scott was just asking. But hes leaving anyway. Doesnt even matter. Doesnt matter. This guy is the best in the industry. The best. And he has had a great vision up until this most recent change in the environment. And im kind of questioning whether or not, i mean, is there a possibility that pace macys cant survive if they are on their own and do you think hes worried about his Balance Sheet. I think its less about the Balance Sheet and i think its more about how do you go on as an ongoing business to think about Top Line Sales in a different way . Everyone is trying to integrate online and the physical and you do need both. But with the Massive Stores that they have and the physical footprint, redeveloping it can more be better than just one alone because can the different locations, do you need more singular locations to be more impactful . Is it going to be a fewer but better phenomenon in the future. So whats the read then to other retailers if macys is this big box that needs an infusion of something, what does it mean for the rest of the space . It means that every single retailer needs to be sitting there saying, how am i going to grow top line and appeal to customers in a new mobile world . What do i need to put in there in order to say, your my store because today consumers have limited time and more choice. So personalization and customizing these stores is going to be private label product, is it going to be instagram bloggers, is it going to be looking at the real estate and saying today we have something here just for you . Is it going to be the Parking Technology and uber drivers . Its that harmonization of both. And i think were going to have a different footprint at the mall over the next five and ten years. Dana, good word to leave it on. Thanks so much for calling in. Talk to you soon. Thank you. Doc . Well, yesterday we talked about this one for unusual activity, judge. We said heated up like crazy over the past three sessions. Yesterday it traded 45,000 calls. Was our trade of the day at the end of the day yesterday. And thats, by the way, a full weeks volume of calls created unusual activity yesterday . This was the final trade yesterday here on the show because of the unusual buying activity that accelerated during the show yesterday. So there were rumors about this ho without the hudsons bay name talked along with it. And huge turnover again, i think obviously there was more than just smoke. Ill say. I would be a seller. Im a seller on the sell on that bump right there . Yeah. Its still in massive downtrend. Im a seller on this whole concept that instagram bloggers are going to save the mall. I was in a mall the other day that had a Doctors Office in it. Ive never seen anything like it. Aeropo aeropostale went bankrupt and mall owners actually bought the right to operate the leases and run the stores. So if the pal is now buying its own tenants just to not have empty stores, im not sure if theres any reason to be bullish on a Department Store which is so much bigger than a footprint like that. So i think its going to be tough. Hoping rerants in macys, have you been to a mall lately . Thats all they have is restaurants now. The big one by me, they tripled thement of restaurants in the food court. So youre going to compete with a bigger food court right out side the mall. I just dont know what the answer is. Stephanie, tell me, jcp, jwn. I wouldnt own any of them. It wouldnt, no. No, its just oh. Estee lauder said something yesterday on their Conference Call. They have been reducing dramatically their exposure to Department Stores. That was the one reason why this company came in at the low end of their guidance. Thats the one thing that keeps hurting them. They cant get the traffic in the door. If you cant get the traffic in the door, its impossible, it really is, and thats im so kind of in an amazement at this point that Terry Lungren couldnt figure it out because he is a pioneer in the industry. And if he cant figure it out i dont think anyone can. I know theyre all trying to do special things like jp penny selling some of the home goods in their stores. Right . And i just dont see thats going to work. But these are this is Short Covering going on and i get it. I know these stocks are really cheap. I just think these are battleground stocks. Thats just hard to the thing with the online, real quick. Of course, they should be pursuing that. But amazon is 43 of ecommerce. Do you want to bet that theyre not going to get to 50, 60, and theyre going the have their own logistics in fulfillment. Theyre building their own fedex. How does an online retailer that is not amazon going to compete with amazon that is selling the same product because its not going to be the same cost in delivering it. Talking about retail and on a day where so many prominent ceo rz at the white house, tuesday were going to have an interview with kevin plank. Lets go to eamon javers at the white house. Eamon . Scott, some of the ceos are emerging from the white house. What did you learn today . Maam . Did anyone disagree with the president in the meeting today . Mr. Fink . Ill see you later on. Okay. All right. Scott, as you can tell the ceo rz leaving the meeting here but they dont have a whole lot to say to us. Were going to talk to these as they emerge here and see what else we can learn from the meeting. Mr. Barra, what did you learn today . We just had an opportunity to have a very constructive dialogue about a wide range of things and i feel very good about it. Did anybody disagree with the president in the meeting today . I appreciate the question but, again, very productive meeting. All right. There you see, scott and mary barra leaving the meeting. Were seeing a couple of ceos emerging. Some of them are going to come out and talk. Some of them are not coming out to talk. So were keeping our eye out here for the rest of the group. But as you heard mary barra there saying it was very productive meeting, scott. Not answering the question though of whether or not anyone disagreed with the president in the meeting. That of course one of the Big Questions going into this as some of the coes have put out statements about im grapgs and other policies they dont agree with this president on. How they approach that, how they dealt with in president on that issue, one of the Big Questions here and well wait and see if any of these other folks will talk to us and tell us what went on in the meeting behind the scenes. While youre standing there and waiting for some more of these ceos to emerge, the questions you ask of the ceos who have come out thus far are so relevant because of what elon musk had said last night, where he said after Travis Kalanick had decided not to be a part of this group, that, in fact, some of the ceos were going to express their concern with some of those executive orders that have come out from the white house. Yes, thats right, scott. You heard the president in the preamble, allowed some of the cameras in the opening part of the meeting. In the preamble the president didnt talk about kalanick and decision not to come to this meeting today but he did go out of his way to emphasize just how popular this group is. He said, ive had a lot of people approach me and tli to get on to this committee. Sort of making the point that if maybe one ceo drops off hes got plenty of others who can join it. Were waiting to see if the white house has a direct comment on kalanick as well because that will be a fascinating issue. Of course, just keeping my eye out here on 17th street to see if a tesla pulls up. You do what you got to do. He took a tesla on the way . You figured that. We have seen blackrocks larry fink, weve seen pepsis nuy, famously camera shy so she wasnt ready to chat with you. But mary barra of General Motors was there. Were looking at a list of some of the of other ceos nonroot. Morgan chases jamie defend, kevin warsh. Schwartzman, instrumental of getting this group today, of blackstone. Jimmy rometty of imb. Absolutely. So a big gathering here at the white house. Again, soics on the agenda. One of the questions that ill have is what specific take aways, do the president give the ceos any homework . Hes done that with some of the the other ceo groups. Im told the manufacturing group, he told the ceos to come back in 30 days and present them with ideas. Is homework presented to this group as well or what specific take aways did they leave with in terms of taxes, trade, immigration, health care, all of those issues that the president is dealing with but we dont have a very clear sense of the specifics underlying that and where theyre going in terms of timing, which one comes first. You have to order this like train cars here in washington to make sure that you can get everything done in a calendar year. Which one are they going to move first on, which is second, which is towards the end of the year. Were going to wait and see if we can get any information on them. I was hoping in the midst of the conversation we would see more but maybe after the break. Eamon . Were keeping our eyes out. Well let you know if we see anything. Eamon javers outside the white house. Heres what else is coming out of the Halftime Report. The list is long. Amazon, amgen, visa, chipotle, gopro, and fireeye. Plus, a wall street analyst says enough is enough on one of last years biggest gainers after a 300 jump. Is it time to get off the train . The Halftime Report with scott wapner is coming right back. Is apniore r eyessixty tyone vio tive y is at pinvesee thnss kehetive y isanxpon obalnaf sthanrebirom voya eal l ta, inucre anngrte s green n ne ti to tel , and br okg. He. En itme td fomeme t. R thmarketrowe pri. G. Obobarkets mcececen. On a perfect car, then smash it into a tree. Your Insurance Company raises your rates. Maybe you shouldve done more research on them. For drivers with accident forgiveness, Liberty Mutual wont raise your rates due to your first accident. And if you do have an accident, our claims centers are available to assist you 24 7. Call for a free quote today. Liberty stands with you™. Liberty mutual insurance. Applied materials since 2000,000. Visa now at the highest level since match of 2008. Both are in the cnbc iq100. That index is up 35 in a year. For more on the cnbc iq index go to cnbc. Com iq100. Now once again, heres scott wapner and the Halftime Report. Were back upon the Halftime Report. Have a huge lineup of big name earnings from the last 24 hours. Amazon, amgen, gopro, fireeye among others all on the move today. Steph, lets start with amazon. You are an owner of the stock. Yes. What did you think of the quarter . I thought it was mixed. There were things to like and things not to like. But i kind of revenue miss . Revenue miss, profitability a little bit better. So its sort of funny. People bash the profit ilabilit when they have better revenues. I get it. I this is a high multiple stock, high expectations. Oh, by the way, seventh profitable quarter in a row. Right . There are some things very good very good at this quarter. It was up 12 in to the print. Very high expectations. You have to have a blowout. Theres absolutely no question about it. You need to have a blowout. Just like facebook needed to have a blowout. I was going to say sometimes it doesnt matter. I was literally just going to say facebook. They had what you can call a blowout. It went down. Both companies guided lower. Facebook guided for higher investment. Theyre in an investment cycle. Amazon is in an investment cycle. Ill take 24 hrs constant revenue bases growth for this company who has great exposure in retail and aws and is going through an investment cycle so they can keep up. That kind of growth going forward. Do i buy it today . No, because its up a lot. Im up 20 since i bought it. 3 is nothing. Should this stock pull back, theyre in such early innings with aws, 10 market share. I almost think its better they have a quarter like this thats just a good quarter, not the greatest quarter ever every time. So that expectations for next quarter and for the full year dont get so out of control in february. Right. I almost think its a good thing if youre an investor. Stock is 3 above the rising 50 day. It might be the most beautiful chart in the s p subpoena. Its fine. They were basically talking on the Conference Call as well about cutting the price for aws. Obviously really eating into them. Seven times in the quarter. I mean, if somebody cuts prices seven times in a year thats a brig thing. Thats how competitive it was leaning in to basically this report. They still did operating margin 26 better than expected. I love thats impressive. I love what theyre doing but it gives you an idea of how competitive this space is. We all know they owned it for a while. They still do. Well, microsoft is really making inroads here with their next report. Now, the only thing is the margins on that for microsoft are going to be impacted the same way they were for amazon on this quarter. All right. Next up, amgen beating on the top and bottom line. They did give weak 2017 guidance though. This has been a stock thats basically in a trapped in a range since december 2014. Has had a lot of trouble breaking out. Its got a nice gap in the chart. Recently its been trending higher along with some of the names in the sector. Its got this really nice pattern of higher lows. Overall from a trading perspective, you want to actually wait for the breakout because this is three years of disappointing investors who try to get in and then it falls back down. Its been way too lumpy to feel really positive about. I would just hang out and let it break out for that. Visa, all time high today, doc, Strong Quarter . Bout it last night on unusual call activity into the bell. Im out of it today by the end of the day. That was quick. Yeah. Well, i mean, you know, these options expire today. The ones i was trading on. The stock has gone up though. I agree. I agree. This was specific to the earnings report. It wasnt a longterm investment for me. I just bought it into the number. I sold calls against it that expire today. Full disclosure, i will be out of it today. Lets go back to the white house where my colleague andrew ross or ken is with a very familiar face and a very familiar name. Andrew . Scott, thank you for that. We are at the white house and we are with that familiar name jack w welsh. Ten minutes out and you were just in this meeting with the president and so many other business luminares and other executives. Tell us what did you learn . Well, we learned that the president deeply involved in every issue and the room was fantastic. Ive been coming down here since 1980 in these meetings. And this is the first one where i had an engaged president , deeply into it. Tell us what happens though, everyone goes around the room and talks about their issue . Is there a debate that happens . There were several debates today. About . About immigration, about womens issues, he spent some time on the womens issues. We had enormous discussion on regular regulation and how to facilitate jobs. It was all about creating exciting economy, where people grow and jobs are created. It was a fabulous meeting. I mean, everyone there is you get one uniform comment, the president is engaged. He wants to make America Great again. He really means it. Did you get any sense, any new ideas about where the tax reform progress is going to be and how he plans to craft it beyond what we know at the moment . No, we had a lot of talk about it but i dont know where he came out on it. Did people come at it from Different Directions . Yes. People had discussions on the border tax and other things. Where did you come out on the border tax . I didnt get involved in that discussion. Where do you think the president was landing given that his comments that he may be not in favor of a border tax . I dont know. You couldnt tell where he was going to end up. He was challenging everybody. One of the big issues as you know has been this executive order on immigration. Right. Travis kalanick deciding to drop out of this group. Right. Was there any commentary about that . Not about travis at all. Yes, there was a lot of discussion about the clarity thats coming from general the Homeland Security head. He was in the meeting . He was in the meeting. He talked about the definition, the visas, everything else. And he assured everybody that clarity was coming. Elon musk had said on twitter that he planned to bring a proposal or make a statement to the president about immigration. Did he . He talked to him in the meeting. What did he say . Thats for elon musk to tell you. Let me ask it this way. Were there any executives in the meeting who were forceful in their approach about specificer sh shus like immigration where they expressed perhaps disfavor with a particular policy being said . There was real discussion on every issue, with chinese currency, et cetera, where there were differing opinions and the president engaged forcefully on every one of them. One of the things that i monday javers noticed in previous meetings in some cases President Trump suggested and given homework to some of the people in ceos in the meeting to come back. That happened today. What was the homework assignment this time . Several. Several groups got together and will bring stuff back to him. I mean, im were talking about a guy in the meeting who acted like a peer, who didnt act president ial. He rolled up his sleeves. He got involved and give and take on the issue. This was the most exciting president ial meeting that ive ever been . Okay. Were going to leave it there. Thank you for joining us. Thanks a lot. Thanks. Were going to send it back to you, scott. Andrew, thank you so much for that with the iconic jack welch outside the white house. One analyst watching the stock up 300 in a year says its time to find another winner. More halftime coming up next. Before the break, our partners at kensho analyzers say what happens to the markets one month after a beat to 50,000 jobs or more for the employment report . Health care fairing best. Up 1. 24 30 days after a job report tops expectations. The s p, down 0. 2 . The financials fall 1. 37 . The Halftime Report with scott wapner is coming right back. Myess bu. W hthe ark cash fm l in micaaa nd drso s. H ds fuel mylinew . Byery llount busiinn. N. Mpieacss sta a growiny, the u dvced ansp t u stto roo nn o be n are introwle ata, day sd ut whe yocan shragieaea ealdes wi mket sials ous otherde d myd ansp tinto twledfotr ers tim. On atd nn omy f blue introwle ata, day sd ut lets pick up where we left off. Chipotle, sales rising for the first time in five quarters. Comps down almost 5 year on year. Who wants it . I think its hard because its had a little bit of a bounce from a low. And i know that the comps are getting a little bit less bad or even better in this case, right . Because the numbers were a little bit better. But they do have some tougher comparisons in february and march relative to january. They did all this heavy promotion last year, february, march, april, just to get people in the door. Also lapping that. I think more importantly, do you have confidence in the 10 earnings power at this company . May seem to be flailing on the call about that. They didnt have as much confidence there. Do you think thats why this stock is doing what its doing . I do. Because if they dont have confidence in getting their 20 restaurant margins those are really big points that people are at least we want clarity on. I just think you hold it here. I dont think you need to sell it. I just think you have to wait. Its too early. If i told you that gopro was up 10 on the year thus far, would you believe me . I believe you. This was one of the most beaten up stocks of the last year. Its not astonishing. This is a stock that went from the high teens to like almost nothing. I know. There was such a string of bad news after bad news after bad news, its just not used to saying that the stock is up 10 . Another one of those, judge, its like fitbit. Its got a great product but they dont make a lot of money. And when you look at the pe of these companies, thats why people stay away. The hero 5 is a great camera. Being able to verb ali to tell it to turn on and off for that sort of stuff for the action crowd, thats fantastic. However, theres a problem here. And big surprise, maybe it retraces to 850 where it came from. This is one of those ipos that came public with a tiny float and i just think investors got totally beaten up and taken advantage of of. Its 100 down to 6 now bounced to 9. No ticker tape rate for this for that reason. Back down to the white house where andrew is now with a man largely responsible at least in part for putting this group or helping to put this group together today, andrew. That is right. We are here with steve warts r schwartzman, the cofounder of blackstone. This meeting happened in large part because of him and he corralled all of these executives from all over the country to get together. We just had jack here, welch, talking about this meeting as something he had never seen since the times hes been coming down here. What did you learn . Well, it was a really terrific meeting because we had people of all different kinds of backgrounds, it was bipartisan meeting, sort of they dont grow on trees here apparently, in washington. And there was a big discussion of different types of domain expertise. Talked about tax, we talked about trade, we talked about infrastructure, we talked about womens issues. There are a variety of things. Talked about education and how we can bring more jobs in terms of training people in technology. And what i would say is that there was complete engagement by everybody in the room, from the president who was discussing what everybody was saying, what his view was. We had all kinds of interaction and it was like just what you would expect as somebody who is interested in making something really work well and the people on the group had lots and lots of suggestions of ways you can make the country function better, create jobs. What was the most interesting or unique proposal that you heard . Is there anything that really, you said to yourself, thats interesting. Theres one thing . Infrastructure, for example, among the many. Where you can sell train structure. Provide some subsidy from the federal government. Let state and local governments get huge amounts of money from selling some of their stuff and then put that money back to build more things for the people in their cities and their states. And have a subsidy from the federal government thats very small to help sell the bonds useful, to finance that. And this is an easy way to inject b hundreds of billions of dollars of deferred maintenance, put that money into the economy quite quickly. That was one of a hundred or so ideas that were on the table. Jack talked about it being a spirited debate, meaning there was conversations on all sides on different issues. When it comes to tax reform, where were the different sides on this and how did you see it play out . The question there is everybody wants lower rates. You know, youve got the ryan plan, which still hasnt been formally announced but of course they have the out lines of that. And hows that going to work . Will there be friction with that . The border adjustment tax . Yes. I know there were a number of executives in the room including walmart, for example, who have been public about their position against that. Well, that sort of, you know, was offset by somebody from boeing who was in the room who was an exporter. How did that conversation happen then in the room . And how did the president react . Well, both sides have good points. You dont want to do something that hurts a significant part of the economy. But you want to get the benefits from the exports. So that was a balance discuss discussion. There was no raised voices. When you say spirited, it was spirited intellectually. China, big issue. Did that come up in the meeting and weve talked about it given that china is one of your big investors. China came up and, you know, im not in the business of sharing what went on in the room. Thats one of the rules. This was a private meeting where you can express yourself. But, yes, the subject did come up. The other issue that has been in the news in the past 24 hours of course is the issue of Travis Kalanick at uber leaving the group and the issue of executive order around immigration. I know you asked him to be a part of the group and i know you talked to him around this decision. I know he called the president yesterday. Whats your reaction to that decision . Well, i think travis was in a really difficult spot. His business was being very adversely effected. He had discontent among his employees and this group actually takes a lot of time. And, you know, he basically said im encountering just too much in the way of headwinds and will you mind if i step down. Do you think that President Trump respected that decision . Do you think that he will i mean, he will make comments about this on twitter . I dont think he will be making comments on this on twitter. Okay. The other question we had was elon musk as you know put out a Statement Last night saying he planned to make some proposals related to immigration to the president. Can you speak a little bit about what that was like . I said im not going to give you what what happened with each person because thats those werent our rules. El elon, you know, of course raised some things, general kelly was there who is in charge of the homeland area and had a bunch of i would call it very straightforward, easy discussions. And there were a lot of improvements, of course, that were made to the initial just announcement of the order. And it seemed like normal type of discussion to me. As images of your meeting were shown on television, the market continued to climb higher this morning. Of course there was the good jobs numbers as well this morning, which we imagine were behind that, too. But did you walk out of this meeting with a greater sense of optimism about the economy . Well, leave aside the jobs numbers which is now backward looking, if you will, you had the sense that there were an enormous number of ways that you could debottleneck the government and improve the economy. The people on this group who were there, and there were 18 of us, each came with a long list of things that can be done. Some very quickly. Some take a little longer. But the receptivity to that was instant. And i said that, you know, sort to summarizing, so many Different Things can be done to make things work. The issue is organization and how a new government what are the next steps for the next meeting . I know he asks for homework so people have to come back with more stuff. Well, i think were like like a Basketball Team that just threw the ball to another player. Right. And theyve got to dribble it for a while. And you know, so the issue is there will be little work groups that are formed. Theres more substance thats going to be shared, and then administration is setting up an infrastructure of people there to handle all this and ultimately get it to the places where you can do i think things. So i am quite confident that there will be lots and lots of things that get actioned out of this. Okay. Steve schwalzman, thank you. Well be right back. Stocks become value stocks. In this stage of the game, these downgrades on look how much its run or valuation, they just dont work. Hang on just a second. Back to the white house. Eamon javers now has a special guest. Couple of ceos are coming out. Very good meeting. Good meeting. What did you learn . All right, sir. Yeah, terrific meeting. What did you learn today . Terrific meeting. His focus on the economy and growing jobs in this country and growing the wealth of the average american, laser focused on it. Very impressed. Couple of ceos are emerging here, getting into the black cars. We havent seen the tesla though, yet. Were guessing that elon musk might still be in the vehicle. Jack welch, of course, an iconic figure in american business, also departing the white house today. You heard him speaking on the north lawn. Some of them are going to the north lawn. Some of them are coming in our direction and seem to be going out in small batches, too, scott. Were doing what we can to find out what was going on in that meeting. You heard an excellent meeting but not willing to give the details about what happened in the meeting. Boeing as well. We did hear from jack welch with andrew. I think this sort of underscores that its hard to overstate the optics and the somebody assistance according to some of these men and women in the room. Jack welch calling it the best meeting of the kind he has ever had in his more than 30 years of going down to the white house. A lot of that depends on your politics. Some ceos come in predisposed to agree with the president and the things he has been doing. Jack welch, i talked to him on the way into the meeting and said what are you going to tell the president today . He said im going to tell him to keep on going, do what hes doing. A ceo who already agrees with this president will be energized by a meeting like this. Other ceos who disagree with him, or are having tougher issues in terms of immigration and other things will be a little more trepidatious, if thats even a word. To that point, jack welch himself wasnt always on team trump. There were times he waivered. Right. He certainly emerged enjoying the conversation, thought it was incredibly productive. Eamon, thank you very much. Meantime, battle brewing in brokerage space today. Charles schwab cuts commission and fees. We ought to be buyers on that. They were responding, of course, to those price cuts. Earnings will be coming down but its not to the magnitude that these stocks came down. Etrade was down 9 yesterday. E trade is a name i own. They have new Management Team with an Aggressive Growth target, targets to improve growth. If they dont get to that growth theyre willing to sell out or make acquisitions and trading at a big discount to the rest. Numbers need recalibrated especially if they lower prices along with schwab, which sounds like thats going to happen. But i think the valuation risk reward is interesting. Im going to beg your pardon and jump back to nvidia. I dont think we adequately finished that conversation. Josh, you dont think its a great call. The stock has had a tremendous run. Lets take it from this perspective. If you own the stock today i dont know that anybody is suggesting its a fresh buy, given the run its had. If you are in this name do you take profits . You could take profits at any time. Thats a function of what your timeframe is as an investor. If you want to own shares in a company thats got an explosive business in all of the secular growth stories in the future, nvidia is like one of the few names that checks every box. From autonomous vehicles, ai, Virtual Machine learning. And in many cases the frontrunner for design win. Its hard for me to say here come this is guy from csla who, by the way, initiated today, didnt downgrade. Probably missed the bulk of the gains. Of course hes going to come and say under perform. Strong buy. He missed it for his clients. I got to go back to the white house now. Andrew sorkin has Mark Weinberger. Andrew . Reporter we are hear with Mark Weinberger who was just in that meeting. We want to get your impressions and specifically what the big surprise was for you from this meeting. It was a great meeting, andrew. Ive worked for two different president s. I was involved in president obamas task force. The level of engagement by the president , Vice President , several members of the Economic Team all taking the time around the table to listen and engage. Very much engage on the issues was refreshing. You could see it in the body language. Just the Comfort Level with which he, the president , seemed to have and the executives in a very different way than some of the body language you used to see with, perhaps, people like president obama. Nothing against president obama but what the president clearly wanted to do was listen. And you got the impression that he not only wanted to listen but move to action. A lot of listening goes on between business and government but not a lot of action. Whats next, how do we figure this out is this. You were tasked with tax and trade and women at work issues. Ivanka trump was in the meeting . Yes. Did she speak at meeting . A little bit, yes. On the tax and trade issue, first, what was your impression as to where this tax reform plan is going to go in terms of where paul ryans plan is, where the border adjustment tax is. Im going to disappoint you. I cant tell you they figured it all out in this meeting. What was really emphasized, its important to get tax reform done this year. The expectations are high. The economic effect will be delayed if the process is delayed. So, make it number one priority. The second was the most important thing was getting the rates down and making sure we have a Competitive International system so that business arent in terms of reading the tea leaves, walking out of a meeting like this, are you more inspired that well get there and when you think about the numbers, the rates, do you say, okay, were really going to do 15 or maybe well be at 25 . I dont think we can tell you what the rate is going to be right now. Its how much pain youre willing to take and offsets. It has to be fiscally responsible in the long term. What i did get a sense of, andrew, is that the president himself was engaged, gary cohn, of course. Whole bunch of people were asking questions really in the details. It wasnt just what should we do. It was in the details about border adjustability, tax rates, international system. I get a sense that this dialogue is going on, theyre trying to move forward. Immigration policy and elon musk had said publicly before he went into the meeting that he planned to address that issue. Can you speak to how that issue was addressed by so many ceos in that meeting . It was really an open dialogue about, listen, we understand national security. We understand what you tried to do. Lot of confusion with global organizations. Mobility is incredibly important to us. We recognize the ability of having immigrants in the United States and our businesses. We have to figure out what this order means and a lot of the anxiety seems to be coming from what people may fear is coming next. What was the president s reaction . He was really receptive to hearing about how it was affecting our businesses, how they can improve the process going forward, listening to o c about the signal its sending and im really hopeful about the next step. Did anybody talk to him about the usage of twitter . No, i didnt hear that come up. Mark, thank you. My pleasure. Appreciate it. Andrew, thank you again. Less than a minute to go. Final trades. Nrg. This is a name, obviously, power generation. The main thing they do. Huge upside call buying. Its rumored that they have an adviser advising them on a price to be taken out in the 20s. We saw what happened with macys. Yes, sir. Well keep our eye on nrg shares. Theyre up 3. 5 . Steph, what do you have . American express and estee lauder. Visa trading at 23 times. Visa quarters great. American express has great numbers coming. Cheapest stock in the dow according to cramer last week. Josh . Amd. Volatile stock on the verge of its next leg higher, i believe, above 12. 25. The juice is loose. And running. Market is, too. Power starts now. They say real estate is all about location, location, location. And todays top business headlines are the same. Because theyre all about the white house, the white house and the white house. President trump talking financial reform, meeting with some of americas biggest ceos and hitting iran with new sanctions. All you need to know about every one of these key stories as stocks rally. Im brian sullivan. Power lunch begins right now