Transcripts For CNBC Power Lunch 20170428

Right now. Indeed it does, everybody. Welcome to power lunch. Im tyler mathisen. Glad you could join us on a beautiful spring afternoon in the new york area. The three major averages struggling for gains this hour. As you see right there the dow down 36. The nasdaq basically gnat. Still, the dow on course for its best weekly gain of 2017. And the s p and the nasdaq both on track to close out their best week since the beginning of the year. Lets check out major movers on earnings right now. Colgate under pressure. Mixed results there. You people have to brush your teeth more. Thats the only problem. Goodyear tire up about 3 . Royal caribbean hitting new alltime highs up about 9 today. The companys ceo will join us later in this program. A lot to drill down on over the next hour, two hours basically. But we have an hour with Mario Gabelli, our guest host for this first hour of power well get his take on the stocks he likes now. He has been following all the earnings, and hes going to share his insights with us. First, though, the earnings parade front and center. Amazon, alphabet popping on the back of their results, big oil also reporting numbers today, chevron and exxon mobil. And you see gains there. Bob pisani has the numbers. Breaking it down for us at the nyse, bob. Reporter hello, tyler. Its about tech and energy, and thats whats moving the markets. The sectors that are up today, tech and energy, and lagging are most of the rest of the sectors, materials and banks, for example. Tech earnings, lets start with alphabet. Huge revenue, better than expected earnings. The stock is up as you heard there. Amazon, big earnings beat. Revenue edged past expectations. Both are up. Microsoft better than expected earnings. Maybe a miss on revenue slightly and thats why its down. Intel not sure why its down. Boosted their qforecast for 201. Take a look at energy. Now big oil coming in. Exxon and mobile good numbers. Exxon more than doubled its earnings and the revenues went up 30 . Its a very simple reason why. Look at the price of oil in the First Quarter of last year. It was 31 on average. Last quarter it was 51. Thats a huge difference and thats why they did better. Here is the bad news. Exxons price is down 10 this year. Theyre all terrible performers because the price of oil has been trending down even with opec trying to cooperate. That fire hose of Shale Oil Production keeping a lid on the price of oil. Capital expenditures are down, production is down a little bit for them as well. Thats a major problem overall here. So here is the bottom line, take a look at the misery of the Energy Stocks this year. The main energy index down 10 . Oil services are down 15 . Oil and gas exploration. Whats going on here is the street itself is starting to take earnings estimates down for the full year because oil and natural gas arent exactly cooperating. Great news for consumers, not great news for energy investors. Guys, back to you. We have those Oil Rig Numbers out. Well get to those in a second. Lets get back to your top stock story, amazon and Alphabet Google and both earnings beats. Aaron kessler covers both for raymond james. He has an outperform on alphabet. Just raised his price target to 1,020 from 950. Welcome to the program, aaron. What is it going to take for you to raise your rating on amazon . So we just lowered our rating this week on amazon. I know. The results came in fairly as expected. Beats on operating income. Operating income was flat year over year. We want to see greater operating leverage. We expect that in the second half of the year. Its a 450 billion market cap. We think investors will demand to see higher income. We think were a ways away from that. We need to see greater increase in income before we get more positive at these levels. So last nights numbers were not enough, in other words, for you to revisit the ratings change. You just made a few days ago. Correct. And if you looked at the q2 operating guidance as we expected they got it bloep the street for q2. So i think that continues to be a concern. Investment cycle is longer than investors expected. We do think shares are fairly valued. You see more competition, growth was in line with expectations but we are seeing a deceleration and operating margin was down about two points from q4. If you listen to googles call, good strength on the cloud as well. Do you think its getting more competitive on the margin there. Weve got Mario Gabelli for the next half hour to an hour. Dont go anywhere. Mar mario, i know you own just a smidge of amazon stock. Are you thinking about adding more . Do you regret not having added more . You think of history, the model 2 ford changed manufacturing. Jeff bozos adds to prodk tift in this country. We look at what jeff does and his annual report. The empowerment. Hes very good. But on the other side of the coin as we talked about we have a company with half a trillion dollar market cap. We take apple, google, or alphabet. Amazon and one other company, you have 2. 5 trillion of market value. How do you think of these companies . Amazon is a retailer, a cloud company, a media company. Apple is a manufacturer, a cloud company, a Services Company and also a media company. All of the above. Dupont tried to put a number on that. Is it an environmental company. Does it matter . Well, at some point it will because if you go back to other dynamics, there may be 400 Portfolio Managers and i go to a meeting for x, y, z and the same business, maybe theres four. So we look for bargains and stocks that are not necessarily well covered and followed. So you cover your four big ones that are 2. 5 trillion. The stock market is only like 30 of the Global Market of 70 trillion. Its wonderful to do. Its nice to talk about. Aaron, lets go back to you and Alphabet Google. So hard to call them alphabet. The stock is up more than 4 . Youve been right on the call. Whats the next growth step for google . Can they continue to exist just really primarily still on add words ad words, the ad platform . Are one of these google moon shots going to pay off big time anytime soon . I think your two big initiatives are mobile search being the key driver as well as advertising and programatic advertising. You have youtube continuing to grow at strong rates. After that we think its the Google Cloud Program as well as hardware. Still relatively early phases but both could be tens of billion dollar businesses over the next several years. Aaron kessler, raymond james, well leave it there. Thank you very much. Appreciate that. The Oil Rig Counts are in and theyre up again. In fact, baker hughes reporting that nine more oil land drilling rigs added in the past week. Weve doubled the number of oil land drilling rigs year over year. We needed five to hit that doubling mark. We got nine. So the number is up year over year. This is the 15th week in a row that we have seen gains, perhaps very good for jobs, perhaps not as good for production and prices. Quickly, demario, back to you. You referenced oil. Are you a believer in the u. S. Shale story . Ive been a believer for 15 years. America has to have their own independence. We probably can produce over 50 . We had a strategic reserve. American technology and capabilities in that area are important to our fundamental being. It cuts down on the amount of net imports which helps our balance of payments. Secondly its important for with regards to our technology and it works. Its also important in terms of national security, it would seem to me. Look, im dreaming about the guys from m. I. T. I know are working on fusion. Just think about it, 1859 the whales were saved. Youre talking about coal fusion creating energy, from energy no net loss. Theyve been in the works for that for 30 years. So . So . Somewhere, somehow technology will develop to create a new way that we dont have to worry about a carbon footprint. Thats what you should be praying for, brian. I remember seeing you on a panel about eight years ago and the question of fracking and shale. Ive rarely seen you as excited about anything as i saw you that day. Thats interesting. If the knicks were able to win. That would make you excited. I remember it distinctly, you were on with one other guy and both of you saw that as transformative. It was and it will continue to be. You obviously have to be concerned about certain fragile ecosystems. You have to learn about the technology that is migrating to the north. And what we like to do is own the land on which who owns the leases, and so we have companies that do that and so on. Who else makes the equipment. You mentioned fusion. Random side note, youll like th this, 1994 i wrote a novel about the guy who discovered coal fusion and was murdered by the energy industry. It was terrible. Did you wake up from that nightmare . No. Didnt go anywhere. You didnt publish it . No, it was a piece of crap. You were afraid of the dark hands of the coal industry . Let me go. Boy, talk about bad news. The beardstown ladies made a pick in our draft yesterday. They have scored very nicely in one days time. They chose amazon. Com with i believe it was their first pick and facebook with their second pick in the stock draft. Joining us for a quick update is buff if i tilottpratt, one of the beardstown ladies. Buffy, welcome. Congratulations on a good pick. You could it could have gone either way. Amazon came out with its earnings yesterday. They were very nice. You did well. It could have gone the other way, right . Yes, we know it could have gone either way and we were happy yesterday afternoon when we heard they beat their earnings estimate. Do you follow these companies and those Earnings Reports as close closely as, for example, mario may . In other words youre really watching them. Well, actually we follow them but none of us can quit our day jobs to do this, so we dont follow them as closely as you do. So what would you like to get out of your investment . Obviously our contest will run for nine months to the day before the super bowl next year. What kind of returns would you like to get . You have, what, about 5 in amazon already. No, well, as of now we have just short of 2 in amazon. Facebook we have a little over 2 . I think we get to combine both stocks for the total return. Were really happy. We represent the man on the street investor or should i say the woman on the street investor. Were doing this, were studying. We dont have as complicated ways of analyzing companies as you do but were also looking at the product and how as you mentioned earlier amazon is changing the way people buy. It goes back, hashirkens in way that you buy what you know. Im sure that lots of you folks use, as many of us do, amazon. You understand it. And facebook you understand it. We have your hats here for amazon and facebook. We have the mailing pact ready to go. Expect your hats, buffy till t tillittpratt. Youre going to look good. Sounds good. Their average return, because we have a spread sheet, 2. 05 . Up next mr. Wonderful at just 0. 4 . Theyre up. One day, wed like to quit now after one day. We know we have to go the long run. Hopefully the stock slayer. Thank you very much. We appreciate you being with us. Thank you. Lets turn back to our guest host, Mario Gabelli, chairman and ceo. What do you think of the market right now . A nice run so far this year. Well, the market started right after the election when capitalism with all of its ugly forms were brought back and as a result of that organizations around the world said the United States even with the rule of law, the free market system and merit okays was the best place to invest and so the dynamics of reg reform, tax reform, everything is in process. And itll take a while. 2018 is good or not. So the market itself, to me, has no margin of safety but its okay. Earnings are okay. Better in 201718. Because of currency changes being less of a negleative and, tyler, in addition the only negative is the multiple because Interest Rates are going up. How do we solve that concern . On may 10th, on may 10th, 2010, the market had a real crash and that was a tiny sample of what can occur in the 2350u tour because of the untested etfs, the untested trading, the untested absence of a buffer known as specialist both upstairs and downstairs so it goes back to what happened in 1987 and that is leyland obrien reuben steen was selling portfolio insurance. If the market is down 10 we get you out. The market dropped from 2700 to 1700. Youre going to have one of those pockets. I cant tell you when or what triggers it but thats why you have to be prepared. Etfs could have a big affect on the market in the next year or so. What happened in 1987 was not economic. We made a lot of money because we figured out it was kind of the mechanics of the market. The same thing on may 10, 2010. It was in 30odd minutes you had stocks go from 70 to 40. Stocks i followed went from 90 to a dime. How do we invest the pro protect the investor . You make 5 or 7 . And well come back and talk about the places youre pinding values because youre known as a guy who looks for values in underreported pockets. Its everywhere. Come on. Ill give you what i recommended in barrons and you double your money. Well be back in just a minute. President donald trump signing an executive order to help u. S. Farmers compete globally. Tom vilsack, governor of a state in the agriculture belt, now president of the u. S. Dairy export council will weigh in on the president s trade policies and much more with investor Mario Gabelli all coming up here on power lunch. Most etfs only track a benchmark. Flexshares etfs are built around the Way Investors think. With objectives like building capital for thfuture, managing Portfolio Risk and liquidity and generating income. Thats real etf innovation. Flexshar. Built by iesrs,for in. Before investing consider e Funds Investment objectives, ris, charges and expenses. Go to flexshares. Com for a prospectus containing this information. Read it carefully. Anything worth pursuing hard work and a plan. At baird, we approach your Wealth Management strategy the same way to create a Financial Plan from generation to genation. Well listen. Well talk. Well plan. Baird. When it comes to trade talks and nafta, believe it or not milk has become a rather, well, sour issue between the u. S. , canada, and mexico. Yesterday several members of congress sent a letter to the president urging action against canadas protectionist dairy policies. They argue are hurting american exports. Bring in tom vilsack, president and ceo of the u. S. Dairy and former secretary of agriculture under president obama. Mr. Vilsack, thanks for joining us. Before we get into sort of the details can you explain to our audience in laymans terms what exactly canada has done that is creating this outrage which for most people i would imagine kind of came out of nowhere. Canada limits the amount of milk that can be produced and processed and has a control on pricing for Dairy Products and they have reduced the cost or the price for milk powder which has created an opportunity for canadian milk powder to be dumped on to the Global Market which will impact, in effect, american producers and producers around the world. They have a very close system, not Market Driven but government driven and it conflicts with open markets. I thought when i heard this, this might be a small gift to wisconsin from the president because its one of the states that turned to help get the president elected. I didnt realize mexico a far bigger market at over 1 billion a year up more than 500 since the passage of nafta, you used to work for obama. Do you agree with what this republican president is doing . Well, yes and no. I certainly agree with the Strong Language the president directed towards canada. Im concerned about the uncertainty hes created with his nafta discussions in mexico. It supports 30,000 jobs here in the United States for dairy. Its the number one market for u. S. Dairy. We want to preserve and streng them the relationship in mexico and open up the markets in canada. So what would you do to make sure theres a fair and level playing ground like weve talked about with lumber, like well talk about with dry wall in the future, with dairy. What do we need to do . We need to look at some of the tariffs that currently canada has and create a system and structure where they cant change the rules in the middle of the game to ben fit their produ producers at the expense of the worlds producers. If we had more consistency, more transparency and more stability, wed be able to have a Market Opportunity in canada we dont have today. It is contrary to wto, to nafta, to uruguay agreements. Its an opportunity now with renegotiation of nafta to open up that market and have a fairer system for everyone. And canadian consumers will benefit most of all because it will bring the cost of their products down. We were speaking with a dairy farmer a couple days ago, and he talked about how much milk there is on the market. I gather weve not seen this level of production of milk ever. Why . Were certainly more productive and efficient and innovative. No question about that. Not just in the United States but the world. Thats why export markets are so incredibly important to the u. S. Dairy consumption in this k country continues to go up but not at the rate that we produce milk, so we have to look for other opportunities and there are tremendous opportunities in asia, southeast asia, and china just got back from a trip convinced there are opportunities there. Terrific opportunities to continue to grow consumption in mexico. Hopefully transitioning from soda to Dairy Products in that country, opening up the market in canada creates tremendous opportunity. Mr. Vilsack, thank you very much. We appreciate your time today. Thank you. As we move to the second 100 days of the Trump Administration, what should the president prioritize to get his economic agenda through congress . Were talking to former press secretary Ari Fleischer on translating Campaign Rhetoric to legislative success. Go to protect your vehicle . Im on it. Weathertech. Made right, in america welcome back to power lunch. President trump promises to boost defense spending. Now the etf that tracks those stocks, the ita, is up about 3 just this month. Outperforming the broader market, american outdoors, all up double digits in april. Keep an eye on these stocks as trump plans to address to really the nation, also the National Rifle Association Convention later on today. All of those things potential catalysts, brian. Back over to you. Dom, thank you very much. The campaign is over. The white house staff has settled in in order to get their call and how to find the printer paper. Now the real work begins. Find out what is next for the white house. Former press secretary Ari Fleischer on the challenges for the trump agenda in the next 100 days. Hi, everybody. Im sue herera. Here is your cnbc news update. Congress approving legislation to extend funding for the federal government by one week. It gives lawmakers until may 5th to settle on a spending bill to fund the government through the rest of the fiscal year. Attorney general Jeff Sessions taking his antigang message to new york this morning. The visit comes as Law Enforcement tries to bring an end to the rash of violent murders linked to foreign gangs like the Central American street gank mms13. Made substantial progress against ms13. Weve seen that in other United States attorneys that ive talked to. Felt like hammered these organizations. But theyve come back. So we know we can hammer them again. Former president george h. W. Bush was discharged from houston methodist after being treated for a mild case of pneumonia and chronic bronchitis. He was admitted on april 14th. And we wish him the very best. Thats the news update this hour. Tomorrow marks President Trumps 100th day in office. This hour he is getting ready to speak to the nra in atlanta, the first time in 34 years a sittinging president has addressed that groups annual convention. The last was Ronald Reagan in 1983. So far the markets have rallied over the first 100 days or 99, just to be precise. The dow up more than 6 . The s p more than 5 . And the nasdaq higher by 9 or better. Wall street on track for the third best performance during a u. S. President s first 100 days since world war ii. So what can we expect in the future . Insights now from former White House Press secretary Ari Fleischer. Ari, welcome back. You know, many in the media have been critical of President Trump for not accomplish enough and not doing enough but i would argue that the one thing that may trump, literally, all of those other shortcomings, if you want to call them that, is the change in the business climate, the change that says to American Business you are welcome here, were not going to get in your way. In fact, were going to try to get out of your way. And if this president and the administration does nothing but that it sets up for a nice time for business in the markets. No question about it but that has to spread to the broader population. All the ingredients economically speaking are there for donald trum top have a successful presidency. When you look at how the markets are up since election day, right track, wrong track, Economic Confidence is up, business Manufacturing Index is up. All of that gives reason to believe trump can be successful. Regulatory approach is healthy. He needs legislation and he also needs to send an infusion to the general public, working class blue collar americans that things are Getting Better and wages are rising. That can carry a presidency. Ari, Mario Gabelli. Wouldnt you then take the mantle and run with it to say we should have an earned Income Credit for everybody thats w k working in this country and pay it to people making a certain wage thats below . Its great to see you. I cant tell you how great you look. Id give you a kiss but i have a cold. Its all right. A virtual one. But, look, i think thats a very good point to be made and that should be participate of broader tax reform. Earned income tax credit has proved to be one of the most successful for getting lowincome people to take jobs otherwise they may not because their ben it fits are too great and you want people to get less Public Benefits and take jobs, 15, 16, 17 an hour without losing government benefits. Thats what the earned income tax credit does and its really important for people in washington to see the economy through the eyes of those who struggle and that program, i think, should be on the table for part of what tax reform should be. I agree. And eliminate carried interest. Were marching to the same drummer, harry. Thank you. What, ari, do you think is the most important unfinished item on the president s agenda for these first 100 days . Is it the health care . In other words that was really key. The building of the wall was certainly a key part of his campaign. Which of the ones that still are sort of lying out there as Unfinished Business do you rate highest in importance . First of all, having worked in the white house, my measuring stick is 500 days. I think you need to wait until into next year and you can have a gauge of whats working, whats not working, what is trumps fault, what is not his fault, what did he inherit, what did he make better or worse. 500 days. And the key ingredient here is congress. And if he has a donothing congress, if republicans cannot unify, if republicans dont realize tremendous damage they did to themselves and to the nation by failing to repeal and replace obamacare, it sends a question mark through everybody can congress get anything done if republicans in the house cannot unify among themselves . That, to me, is the biggest question mark for the trump presidency. Donald trump deserves some of the blame for that. Frankly, i blame much more of the internal operations of House Republicans. The fact conservatives and moderates dont realize that they must Work Together because if they dont and they try to blame one another for the repeal failure, republicans will never be trusted again to go into public office. Whats the good of having them in control if they dont use that control to do things for the good of the American People . That, to me, is the key thing trump has to figure out, congress has to figure it out. So looking ahead to the next 100 days or 400 days if you want to peg it as the important marker here, what were the Lessons Learned from the initial effort to repeal and replace the aca . Im sure that theyre doing a post mmortem if they havent already to get the legislative agenda accomplished. Well, when something fails like that and there was a failure from both the white house, the house leadership, speaker ryan, down through the grassroots. What you have to do in the house is let the grassroots figure it out. Pressure are from the top wont get it over the finish line. Youve got to let the grassroots moderate faction get together and if they havent realized they cannot unite nothing good is going to happen for this country. Theyve got to realize the burden and the responsibility of governing is on their shoulder. What i fear the most is that really House Republicans have not had the governance since 2006, the last time they had the majority with a republican in the white house. And so many of the instincts and abilities of House Republicans are to oppose nancy pelosi and barack obama. That was great. Im glad they did it. Now theyd better learn how to govern and thats the job. Youre a sports guy. You know this. If you are the last place team in baseball, theres no pressure on you. And if you win, great. If you lose, nah. Now youre the first place team. Now everybody expects you to win. Do you believe paul ryan and the Republican Leadership know how to win . I think paul ryan does. I think paul ryan is a serious man who wants to bring people together. I think the problem here is, frankly, the moderates and the conservatives at the grassroots level. Theyd better realize theyre on the same team. If they try to take the blame off themselves to put it on the moderates and vice versa, theyre not one team. If House Republicans cannot operate as one team, then they dont deserve to have the majority. Arent they one party . I mean, we seem to be circling here. The idea there are two parties within the party. Theres two wings within the party. The history of the republican party, and its not new, they figure it out. They get together for the greater good. They compromise and thats what theyd better do here. Its not the first time weve had that. The southern democrats and the northern democrats were divided on lots of things in the 50s, 60s and going way back. Ari fleischer, thanks very much. Thank you. Well, infrastructure, of course, a big part of President Trumps agenda. So mario here owns a few names in this category. Mario, im just curious, is that an investable thesis . Its more than investable. We housed a meeting every year, the American Society of Civil Engineers every four years comes out with a report. Whats going on in our infrastructure. They just rated our country our country bplus. A major uptick. Imagine if you said i got a dplus up from a dminus . I would be disowned. I would have a party. Good luck. Inland waterway, the electric grid, fortunately some it have like the electric grid is being handled by private Public Partnerships so we need that. Now what do i want to own . I want to own, as an example, melissa, december 15, 2015, they passed an act that said fix transportation. You had a great deal of visibility for five years for stocks like gencor doubled. We like everyone that has this ecosystem. Now who do i like . A 10 stock will go to 20. Theyre in construction equipment. You saw what happened to cat and deere. Anything to do with water i like. New ceo. A work in progress. And theres a whole bunch of Companies Like that. And then the electric grid needs to be reinforced. We buy some utility companies, water companies. So thats it. Why is there skepticism . The average infrastructure stock is up 23 . This year the average infrastructure stock is down 1 as a group average. Whatever you want. What im saying i just worry. Did all the run come already . No. Youre not even beginning. Come on. Look at laguardia airport. Stop. Have you ever been there or do you fly private . The airport is simple. You go there and you see how bad it is. I just landed at l. A. X. Im the guy that complains about airports every day. Its been bad for years and years and years. What changes now do you believe the Trump Administration will get something done . Did you look at waldman in manhattan . Some of the golf courses like the one in the bronx . Where are we going to do it, get the money, how do we put public and private together as a country. Im tired of potholes. I have cars that benefit. Do you own goodyear . Youre hedged on that. Whats good for the farmer may not be good for the parade and so as a result of that we want the last thing is you want another bridge to collapse like in atlanta, georgia, and this time with a lot of people on it because were saying, hey, were not fixing it. Well find the money. We have to do it and it enhances productivity. The amount of time you spend on the cross bronx, whatever expressway youre on, just to go over the bridges in new york its not worth it. Definitely. Infrastructure is important because it helps fiscal stimulation. It offsets monetary policy. It helps the jobs in the middle of the country. It helps everyone. You were kidding about laguardia. You do watch power lunch religiously. I complain every single week. Wear your bulletproof vests when im around. All right, down to the bond report, rick santelli, rescue us, rick santelli. Reporter thanks, sully. Basically unchanged on the day, maybe up a basis point. Up five on the week. Starting out with the ten it closed out lags month at 2. 29. Last year at 2. 44. Still close. Bunds down one basis point. Hyg, this hinge is finishing up strong and many look at it to give us kind of a barometer of whats going on. The equity markets are probably well behaved and the spreads are rather well behaved all exactly true. And finally the dollar index odd man out. Its down a penny on the week and close to a penny and a half up month to date. Melissa lee, back to you. Thank you, rick san it telly. Coming up, the 411 on a powerhouse hitting the market. Well tell you which grammyaward winner is selling her new jersey mansion straight ahead. Most etfs only track a benchmark. Flexshares etfs are built around the Way Investors think. With objectives like building capital for the future, managing Portfolio Risk and liquidity and generating income. Thats real etf innovation. Flexshares. Built by investors, for investors. Before investing consider the Funds Investment objectives, risks, charges and expenses. Go to flexshares. Com for a prospectus containing this information. Read it carefully. Will your business be ready when growth presents itself . American express open cards can help you take on a new job, or fill a big order or expand your office and take on whatever comes next. Find out how American Express cards and services can help prepare you for growth at open. Com. Its a performance machine. Of engineering. Find out how American Express cards and services with this degree of intelligence. Its a supercomputer. With this grade of protection. Its a fortress. And with this standard of luxury. Its an oasis. The 2017 eclass. Its everything you need it to be. And more. Lease the e300 for 549 a month at your local mercedesbenz dealer. Mercedesbenz. The best or nothing. These are Analyst Recommendations we believe you need to know. Morgan stanley to an overweight price target of 120. The tech company is ahead of schedule in its transition to a type of nonvolatile digital storage. Also a synergy target. A 15 gain. Piper jaffray raises targets. Price lines biggest market in europe likely had a strong First Quarter. By the way, europe is more than 50 of price lines revenue. They say the company can capture more market share. They see the potential for earnings upside. The earnings are out on price line may 9. Not a whole lot of upside but another bullish call. The third stock here is starbucks. After reporting what some are saying is a disappointing quarter the shortfall the stock is pulling back. Bmo meantime reiterating outperform rating raising the price target to 67 a share saying, look, focus on the p positive things. China, same store sales up. That was about 29 of transactions so capitalize on this nearterm weakness in the shares. You drink coffee in the morning, maybe beer at night. Your final stock, susquehanna upgraded to a positive from a neutral. They boost the target. Thats 25 upside from here. The analyst says that despite a, quote, awful First Quarter, the stock seems to have found a bottom at 140 a share and call it compelling. A number of signs point to improving trends. The stock is up 3 today but they see a lot more upside at susquehanna. Over to you, tyler. Ill try to help them this weekend. Time now for your powerhouse of the week giving you rare looks into the homes of celebrities and ceos. This week grammy Award Winning hiphop soul singer mary j. Blige. This 13,000squarefoot chateau is the home of mary j. Blige. Walk inside the front door of the divas estate and youll find a foyer that leads no not one but two massive living rooms. This one with its animal accents has its own private bar. Pass the formal dining room with seating for eight and private library with its own fireplace, a traditional gourmet chefs kitchen. Even more upstairs like the master suite with its private sitting area, kingsized bed, and very own espresso machine. Theres also a marble covered his and her bath. Take the elevator to the lower level and youll find a walkin wine cellar as well as a personal gym that overlooks an indoor basketball court. Grb some popcorn with five of your friends inside the mega mansions home theater. Out back is a private Swimming Pool and pool house. This estate is nestled in saddle river, new jersey, just 25 miles from new york city. Make the divas digs your own for just under 9 million. Lets take a look at these numbers. She bought this place for 12. 3 million in 2008. Of course the housing crash, took a big hit, never quite rebounded in saddle river. It was listed for 13 million and now its down to 8. 8 million. She would be taking a loss if she sold at the list of about 3 million. That doesnt even include the taxes shes likely paid which in saddle river shes probably paying 50,000 to 100,000. Easy. Should she be allowed to takes a Tax Deduction for that loss . Not under the trump plan. Forget the trump plan. On anybodys plan. Under Capital Gains she would take a loss. If you sell at a profit you pay a tax. If you sell at a loss do you get a Tax Deduction . Independent of all of that thats not how the government works. I think she has a brandnew album. I think shell be okay. Im not worried about mary j. Blige. Not at all. Like cnbc. Robert, youll be joining us to discuss a competition thats gotten a lot tighter over the past couple of days. Over the past couple of minutes. The past couple of minutes. 3 billion. Real time on cn the worlds richest person, that contest getting closer. Straight ahead mario will give us a look at some of his top picks. Hes got investing pieces around one guy, this one guy may be the key to making you rich. Power lunch back at 2 00. Online u. S. Equity trades. You realize the smartest investing idea, isnt just what you invest in, but who you invest with. A used car, our time with him is naering an end but we want to get a couple ideas from mario in your pick. Whats topping your lust now . Theres a lot. We covered 1600 companies and we have a lot of the small caps, but in that context who may have made money for share hoerlds over a long period of time. You think about people with mobility, with the mobile devices whos got content and connectivity. The second thing is who drinks what where. So we think about these things. In the context of connectivity we created a fund as a bass get called media mogul. For example you want to own charter in the able area. Finger prints on close to 300 billion worth market cap. If you own everything, maybe about a 14 kager in the last 15 years. Would you want a cable own to own a telecome for instance . If youre thinking about it in that way right . Im a ceo of a company and the stocks come i cant do that. The point is the customer needs to have data, it needs voice, video and who knows what else they want. So how do you get to that customer, not only in the United States but globally . In the United States we only have 330 Million People. Theres 7 billion around the world whos got that fingerprint . Malone has that. And he is the guy thats made more money in more ways over the decades in telecome and cable than anybody including you. And land. Dont ignore content. Lets get serious about this. How about sirius. The real estate in automobiles is 100 million cars being produced this year. Then i like fox. I was just going to ask, is fox the biggest holer . Are you worried about all the stuff going on over there . They brought back 700 million shares, and you multiply that, theyre going to do 9 billion and cap ex at 300 million. This is a cash cow. In addition they got three blue people movies coming out and thats going to come out come on tyler. In addition to that youre looking out. Do i worry about everything. I worry about everything. Rupert doesnt take it personally if i sue him, i hope he doesnt, and he doesnt know im suing but now he does. Hes done a good job. Malone has done a fabulous job for 40 years. Viacom. Cbs you like. I dont ignore come cast. I think steve burke has done a great job. And the whole notion of american content going global, wireless, mobility and data. Cwhat is the risk to the capabl companies . 5 g. 5g is the speed. Thats why theres this hissing over straight pad because they got licenses and its only like 130 times 13 million shares, these guys are going to say this is bfront property. Forget your property in new jersey there, how do we own the ability to have the super highways. Then how does google get away with not paying a freight bill and next felix for use of the highway . Theres a sign, trump pay x, passenger cars, y. These guys with getting the highway for free doesnt make sense. I use too much water i get a bill i cut back on my water. We have heat at 60 and airconditioning at 80, so we pay less. Isnt that what you do tyler . My house is cold. I warm you up. You do every time. Those are the companies we like. We like the contend, connectivity and the cable guy haves a part of that for the time being. Disuponing gdp data, corporate earnings sent the market soaring this week. Which market has the real read on the committee, a closer look. Earnings versus gdp, strait ahead. Power lunch. So what else is new . Hows your mother . Umm. Shes doing good. She needs more care though. She wants to stay in her house. I dont know even where to start with that. First, lets take a look at your Financial Plan and see what we can do. Ok, so weve got. Well listen. Well talk. Well plan. Baird. When this bell rings. It starts a chain reaction. Thats heard throughout the connected business world. At t Network Security helps protect business, from the largest Financial Markets to the smallest transactions, by sensing cyberattacks in near real time and automatically deploying countermeasures. Keeping the world of business connected and protected. Thats the power of and. Welcome to the second hour of power lunch im melissa lee, two hours until the closing bell rings. This is what were watching this hour, its been a great start to the stocks especially on nasdaq earnings up 12 . Which is right, what does it mean for stocks right now. Were watching shares of star bucs falling today after a shares misrough start with the ceo. And were watching the race for second place. Could jeff bezo become the second richest man in the world behind warren buffet. Check out some movies, google a few dollars behind amazon. The race to 1,000 bucks a share. Not hurting that company too much, earnings and sales betting the street forecast and that Company Stock up 37 today alone. Exxon and chevron moving higher both reporting unexpected profits. World caribbean proving today. One of the biggest games in the s p 500 after its earnings and well talk to the ceo coming this hour. All right overall the markets are down a bit today but its been a good week. The doe industrial average up 2 . As melissa said, First Quarter gdp coming in weak. How account average be strong if the committee is not doing well. Steve lease man joining us now from washington, d. C. Theres a few Different Things were talking about. Earnings are being helped a bit by decent growth overseas as well. The economy in the u. S. Is not as weak as gdp percent. A big part of the weakness came from inventory adjustments, so forecasters think the committecs going to bounce back after restock in this corner. And of course theres this other court that we talk a lot about, q1 data has been unusually week for years, the problem is because of the the data crutching not the actual economy. Some guys boosted their forecast today, but when you average it out its still around 2 this quarter and last quarter. The biggest committee is whether the economy could do better. One good side was the investment numbers were double digits. Well bring in Ron Lowe Sohn in this discussion. Do you pre we looked through the First Quarter. Tourism is down, weve had workers leave the country, that may have been a small thing by the tourism have been cut back in the last several months. That may be small not big. Do you think the business siding is that evidence of animal spirits kicking in . It could be. As steve pointed out the demand around the world is picking up. China seems to be rebounding to a certain extent. So with the world more synchronized than its been in a while well see exports get some transaction. Do you believe in the gdp number . I dont know how outdated it is because theres so many components you can put in. Theres a lag in the trade numbers, in inventory datas always off. Theres always some issues weve had with gdp numbers, but this has been with us the last couple years. Why dont they fix it steve in. Allky tell you is that theyre working on it. We think one of weakness is in defense spending who does defense spending . The government. The government seems in capable of counting of what the government is going. Among the things surprise . That that would be one of the easy ones. We see this, by the way, government jobs, they have trouble counting that as well. Theres the thing going on, were not quite sure. Heres the dangers, one of these things its beginning to come along, the First Quarter ears going to be week and people are going to discount it and not get the first signal out there. My work shows, and this has been accepted by the dba that this has gone on for 30 years unnotice requested just last year they try to fix the adjustment problems. So not to blow all of steves segments out of the water, do we ignore the q1 number . This is the thing this is a good question for ron because ron is better at pricing probabilities im better at giving them to you. It has been a better better the last year to discount the First Quarter and play a Second Quarter rebound. I can tell you all the forecasters i follow on the street are playing that right now. It feels like a sandbag number, the First Quarter. Yeah it does. The only problem went they raise it to 3 the Second Quarter is missing that number as well. The average is somewhere closer to 2 , that over the last several years. Im not sure if you want to take Second Quarter immediately to 3 . Private sector government has been robust over the last several years. That depressed the government component of gdp for quite sometime. I want to add to that. The fed has been signaling that the employment numbers do a better job with signaling the weakness and strength of the economy. Why for us steve, the firms would raise q1 and 2 growth at this point, what is the data theyre using . A lot of this is expectations for inventory which i hope people didnt just click their t. V. S off. Its among the most boring, but among the most viletal parts of gdp. Some quarters inventory decline more and you almost automatically when you have that build in a build for some companies. Companies need stuff on their shelves to sell. When you have small gains like we did in the First Quarter its always a good bet bank on a rebuilding in the Second Quarter. Trade is on a delayed basis so thats always revised one way or another when it comes to computing gdp because the trade data lagged by several months, so its difficult to get a number of how much trade data is following. The bigger anomaly is zero percent rise in Consumer Spending. Its hard to talk about consumer spender. Also this utility component, again, im telling you the inner details here, because it was a warmer weather people didnt spend much on utilities. That is interesting because the refund comes later. I didnt get a refund. Nor did i. And the irs got its money right on time. It always does. Youll never get an interest on it when they hold it till the following year. Ron, steve thank you. Manufacturing will thank you President Trump this week. The National Association of manufacturers launching a campaign praising the president for keeping his promise for manufacturing jobs. Joining us now jay tibman, ceo of the National Association of manufacturerers. When i was looking at some of the notes, my eyes are going, 93 of your 1400 constituents are now positive on the economy, the highest in 20 years . 14,000. And at 93 . 93 , and that was a 20year high. And the reason for that is because we do have a promise whos kept his promises to reform the regulatory system, hes done that very well. And the president who has issued the boldest principles and blueprint for tax reform that frankly any president ever has. Lets be clear, has anything changed from your constituents. Trump has signed a number of executive orders, Congress Though make it is laws . Have you soon any of the deregulation Impact Business . Absolutely. Give us an example. Sure. Some of these regulations were put on the books by executive order. So you think about the pipeline permits for instance, and cutting through the red tape and the stalling of those permits. Thats gotten done. Weve seen a change in the process. I dont want to deemphasize or i dont want that process to be deemphasized because that is so crucial to businesses when making decisions about where that next dollar is going to be invested, where that next job is going to be created, and we want that toto occur here in the United States. The executive orders that the president have signed gone a long way to creating certainty and confidence in our economy. How much do you think Regulatory Reform will add in percentage terms to the growth rate of manufacturing in United States . Im not an economist so ill leave that to steve and did you ran. What im hearing from those 14,000 members is a tremendous confidence in reducing the cost of doing business here in the United States. Right now its somewhere between 12 and 24 to manufacturer in the United States than it is among our major trader partners and thats after the cost of labor. Thats due to the Regulatory Regime we live under, the taxi structure he live under, the highest in the world. And have a zero budget, if you will for the regulatory cost Going Forward is a tremendous boost in confidence how do you hit the sweet spot jay between excessive regulation and smart regulation . Because i know you and your members would say we dont want to be overly regulated thats exactly. We want to have good working conditions for our workers and sometimes lets face it, not just Manufacturing Companies but all kinds of companies have not behaved there had ways let me put thit way sometimes they invited regulation through their behavior. Look, i think that modern manufacturers urns the importance of a strong, trans important and common sense regulatory structure. But i want to give you fact that is startling to me, i knew it was a large number but until we quant tied it, we didnt have any idea that manufacturers are subjected to 297,696 regulation. Almost 300,000 regulations. That equates to employees per year and employee cost for small medium manufacturer. So if you look at that number you elz, theres got to be efficiencies we can gain from a ber process. Those regulations may be a negative jay, give an automation just continued surge do you think were going to have to have regulation around automation . I think youre going to have to have best practices and structure put around it. Heres an interesting number as well. The cnbc is good we like the numbers. 350,000 jobs today are going unfilled because we cant find workers with the right skills. A lot of the skills we need are related to technology and information, Artificial Intelligence and robotics. So were looking for workers and very highpaid workers i might add with those skills. So, there will be some structure put around that in the future, but right now were excited about the opportunities that exist in the workplace in modern manufacturer. Jay timmons pleasure. Keep us informed. Thank you. Key part of President Trumps packs proposal next week is the elimination of the state tax acts called the death tax. It will be a bloom for wealthy people. Its only wealthy people that pay the state tax anyway. Robert what does this mean . President trump wants to kill the death tax once and for all, but its been going away on its own for years. The state tax applies else estates valued at 10. 9 million or more for couples. Its only the richest of the rich who actually end up paying it and even theyre not paying much anymore. About 5,000 people were paid taxes this year thats out of 2. 7 million debts so 1. 5 Million People paid tax. Top. 1 paid about a third of it. Revenue from the taxes fell to 19 billion this year. The number of mil areas and billionaires that we grow have groan substantially. That use to account for 8 of the tax revenue now its about half of 1 . Why is it dropping so fast . Ex semgss. Its only the rich of the rich that way and wealthy is using effective trust to avoid the tax. We want multigenerational businesses to be passed on from Family Member to Family Member. And they highlighted farmers, but only 50 farms and Family Businesses will they any estate tax this year. I have always wondered having encountered the death taxi when my parents passed away, why del was a taxable event. I also wondered why death entitled the in her for to a stepup in basis. Theres a fundamental argue and a financial argument, it was put in time when the nation really needed revenues in world war ii and theres a sense we dont want to be theres dynasties that control everything. So lets talk about an individual who would be subject to the death tax. Yes. In theory. More and more every day. Amazon share soaring just yesterday on the back of that Earnings Report giving up much of the gains this hour. What do these latest games in amazon mean for jeff bezo, his wealth. How close is me to becoming the richest person in the world . Well he was sleeping, 3 billion last night. And over the last five years hes added 65 billion to his fortune. He is now within 5 billion of bill gates is somewhere around 87 billion. My guess is at some point over the the next two to three months months not years . Months. What does the stock price has to hit . 990 is what it has to be. What is it around 9 925 and change right now. The session was on amazon. But look the last time i was on talking about this a few weeks ago, you know, the stock was up in the high 800s i think, we said maybe this year it will get to 9909 but i think itll be faster than that. Microsoft stock is not moving as fast so bill gates may come down while bezo goes up. Two guys from seattle. Yeah something in the water there i guess. Rob thank you. Robert frank. Heres whats coming up, which is right the economy or earnings . And what does it mean for stocks. And the does the ceo of starbucks have a problem on his hand. Have he hit peak sports writes fees. Well talk to the owner from soccer leads and much more. Add we head out take a check on the markets, were sitting at near session lows, as i mentioned amazon hitting lows. Power lunch back in two. Why pause a spontaneous moment . Cialis for daily use treats ed and the urinary symptoms of bph. Tell your doctor about your medicines, and ask if your heart is healthy enough for sex. Do not take cialis if you take nitrates for chest pain, or adempas® for pulmonary hypertension, as this may cause an unsafe drop in blood pressure. Do not drink alcohol in excess. To avoid longterm injury, get medical help right away for an erection lasting more than four hours. If you have a sudden decrease or loss of hearing or vision, or an allergic reaction, stop taking cialis and get medical help right away. Ask your doctor about cialis. Hthis bad boy is a mobile trading desk so that i can take my Trading Platform wherever i go. You know that thinkorswim seamlessly syncs across all your devices, right . Oh, so my custom studies will go with me . Anywhere you want to go the markets hot sync your platform on any device with thinkorswim. Only at Td Ameritrade lets[ whimpers ] dog. Find pingpong. Okay, lets go. Find your awesome with the xfinity x1 voice remote. Thats amazing earnings driving markets today. Amazon up, is it still up . Its up. But lows the major average is how evering near those session lows closing out the month of april. The mark has remained quite resilient so what would the next 100 days look like on wall street. For that we turn to our guests mark and mar gee of wells fargo. What do you think mar gee this is a seasonal weaker time of year, what are you preparing for this time . Well i think still going to trop around and not make a lot of head way because the First Quarter earnings are okay but not enough to drive the markets to the next level. So well trop around and it wont be until lair in the year, maybe say the Fourth Quarter when we see the positive benefits in the companies. Companies spending more, more people going back to work, i think we could have a very strong finish to the year. So mar gee says we should look at sort of a trading range, choppiness over the next few months, what do you see . Its hard to make an explosive move tyler. The markets put a big downpayment on pulling forward a lot of the proposals that were market friendly under the new administration and mainly tax reform. We got a relief rally out of the president reelection, may not get that again. So its going to have to be the economy and earnings that are doing the heavy lifting. I expect the Economic Conditions to remain sturdy. We have a pretty act bishs Profit Growth for 2017. I think it can be match pedestrianed i think with a fairly positive glow that could help boost equities. I agree with mar gee in terms of them being up in a yearly basis but i dont know if we have to be stuck between a trading range. More gee where can i make money over the next month or so . A lot of Technologies Companies that have proven that they have secular growth even in this economy. I think in the healthcare space, the tools and devices will continue to be sturdy, accelerating growth. I think in the defense sector, well continue to see the need for more defense investment and well see those companies have higher cash flow as well as other industrial companies. I think were in the beginning of a modest cyclical rebound. All right some good ideas there. Mark the same question to you, where can i eke out some gains in the the next six months between now and the end of the year . Sure. Housing related industries to us are very appealing. Theres going to be continued Home Ownership growth and it sits well for new and investing homes, including the doityourself Home Improvement companies. That should be good for Asset Managers and custodial banks that make money on shortterm moves. We continue to find the European Economic story to be very attractive. Run by not only growth but accommodate earning positions. Evaluations are 30 to 40 cheaper than u. S. Counter parts. Appreciate your time. Magazines, t and software. Good, bad and the ugly is next. Consumer up 10 the year. The gdp says spending is weak, which is correct. Power lunch will be right back. She cant become a guitar legend just by playing air guitar. The babys room wont build itself. And her paw wont heal on its own. Were all working forward to something. Synchrony financial can help your customers make it happen sooner. So she can plug into her dreams. And theyll have a new addition for their new addition. Whatever youre working forward to, even if its chasing squirrels, Synchrony Financial can help you get there. Whether youre after supreme performance. Even if it chasing squirrels,. Advanced intelligence. Or breathtaking style. Theres a cclass just for you. Decisions, decisions, decisions. Lease the c300 sedan for 389 a month at your local mercedesbenz dealer. Mercedesbenz. The best or nothing. Hi serve im sue herrera. Heres your update tip. President trump signing an executive order rolling back restrictions on offshore oil and gas drill. This is a great day for more than workers and families and today were unleashing the American Energy and clearing the way for thousands and thousands of highpaying American Energy jobs. British county raided a home today arresting five people. The almost terror attack was not connected to yesterdays arrest of a 20yearold man out outside of parliament. And its a big day from this young boy, who has a rare and uncurable disease. He received his wish by becoming a veteran for one day. We wish trent and his family all the best. Hes just so cute. Thats the news update this hour. Back to you. God bless that boy and his family and everybody. Yep. Pray for something good to happen. Sue thank you very much. You got it. We are 90 minutes from the closing bell on walmart. Pretty good for stocks, nasdaq crossing 6,000 for the first time ever. Oil by the way, closing the day, right around 49 a barrel. We have now doubled the land drill rigs year overyear. Thanks. First quarter earnings expectations earning review knew. With this 12 first gain it makes dental products including in vis line. The stock is down after the border decided not to sell the company. N nasdaq is down by 19 . It is an ugly day for athena may health. Its punishment appellating. The stock down by 18 . Were also watching decline in shares of star bucs after Second Quarter sell fell short. What does a company need to do to improve revenue. Joining us is bob. Great to have you with us. I heard a lot of excuses on that call but what concern me the most and a lot of people on the street, they cited the rob still with mobile oiling and slower overall customer service. Have they said anything to make you believe the worst is boone them on those two fronts . What they said about the mobile oil and mobile pay, theyre making progress in improving the 1200 plus restaurants that have been negatively affected this past quarter. Theres no doubt when you have people who are grumpy coming in for theyre first cup of the day who are in a hurry to get to the office informed they dont get tap care of fast enough youre going to have complaints. And it hurt them last quarter. They made progress on that, theyre not quite positive yet but theyre making substantial improvement. So clearly theyre making good end roads at taking care of their customers. Kevin johnson the ceo says hes confident that numbers have turned the quarter. Is that what you signing according to your own research . Yes. Theres no doubt they jump started the april period. The unicorn frappuccino has been, you know disgusting. Amazing. Oh sorry thats my first reaction. A unicorn frappuccino. Big pink dom gets them every day. Cits like if fewty pebbles and coffee had a baby, oh my goodness. There is a buzz when you bring a product like that to mark, theres a this company i know theres a lot of buzz at starbucks i tell you. That aside. If you look at the breath of the consumer who uses the brand, your needs and mind, relative to my 19yearold daughter and 21yearold son are very different. Their catering to a a broad its not catering to your needs and mind. Management gets it, but i think the important thing especially is theyre spending to take care of both you and my daughter. They have a broader generational reach with that brand and they have a little higher income level consumer. Theyre not advertising to the poor and the huddled masses, theyre advertising a consumer with a little bit higher house income whos looking for a better quality experience and theyre not as concern about the competition bob whats the next leg up, i remember a number of years ago when everybody says booze was going to be the next big boost for starbucks . Where do they substantiate from converting it to a sort of coffee, now light food shop to maybe a full Service Place . Well, you know, for example the rosterry that did the companys testing are clearing Higher Quality experience, much broader food and drink experience, some of those roasterries are toying with different whines and liqueurs. I thought they had that in some places, chicago i think i saw that. There are some of those in the stores and that will be a very select number of the restaurants reserved location, which by the way you need to have a liquor listens to sell those. The check on the roasterry is 20 versus 30 in the store. So whats the check on that i would imagine much higher . Id expect it to be materially much higher if you can bring in some beverage, alcohol, margins on those things are terroristic. Bob great to see you. Gus and unbuzzed. By the way we have a shot of the unicorn. Look at that man. Can someone get me one of those . I told you fruity pebbles and coffee had a baby there you go. If you still think professional soccer is a Little League sport youre living in the past. Coming up were going to speak with the owner of portland tim bers on how big the sport can get. I wanted to point out the surge we seen in tesla surge. 314. 50 is the alltime high for tesla. So with a striking distance of an alltime high. What was the contest yesterday . Todd gordon. I chose his team, that was my overall pick. Well see. Major League Soccer off to another strong start. The average club worth 185 million according to forbes ceo of one of those clubs who happen to have more points than the timbers. The last club worth 210 million according to forbes and he joins us now. Merit heres the thing about soccer which is your club is doing more tendons per game on average than everybody Basketball Team except for the chicago bulls. Why do i think america seems to have this issue with, well soccers this little thing it will never be big, its already big. How do you tell america that youre big . Young america knows that. Its a great time to be in the soccer business. I think it was always a matter of when and not if the worlds game is going to catch on in the biggest media market and thats happening. By every single metric the growth weve seen has been extreme. Things are very very good. So if you dont get it now youre never going to get it. You know, and theres no more teams expected to come online and whats amazing to me is weve seen success, orlando are leading the conference, even if our viewers dont care about soccer. On most sports it takes team a long time the jackson jacksonville waiting to be a good team. How is it that a team can be a good tame right away. Its a mark brian that ill admit i was skeptical about. It hasnt been a pro team market but its knocking it out of the park. Thats the wrong Sports Metaphor but its amazing. Its a new city. Young atlanta is really taken to atlanta united. That story is more the norm in the exception across the country. Talk me through, not just in your market of portland but for ml s across the country. Segment, the typical attendee of a game . What is their age, theyreth necessarisy where do they come from . Are they rich or poor, what . We index really high with millennials in young america. I think espns did a study not too long ago that age 10 to 20 their favorite sport beyond the nfl is soccer. Young america we index very high. Portlands start of the young hit downtown urban deal. When its hot and cool everybody wants to be a part of it. Identify got friends in their 60s who know every detail and stat and follow the game like you wouldnt believe it really does know no bounds but we index high with young america. It was a tough day in media world in espns a lot of people getting laid off, the industry concern about overpaying for rights, does it worry you in any way that ml s may have peaked in terms of the t. V. Side . Not at all. First of all, with respect to espns id say two things, number one theyve been a great partner of ml s, and number two theyre still by any metric the leader in Sports Broadcasting and i think will be the leader in Sports Broadcasting for the foreseeable future. But, when you look at the history of sports distribution ranks its very much been a revolution whether it was a birth of espns in the late 90s to fox in the early 90s. In terms of the internet theres been a lot of change and evolution, but theres been one can substantiate, thats the game content thats appreciated. Its grown leaps and bounds and thats going to continue to happen. Its a lot going on with distribution, mls itself have two individuals games its putting on facebook right now. You got the nfl game night, they were on twitter last year. Thats all a good and healthy dynamic. Its a great spot to be if your a live sports content holder and we are very much that. I tried to get the team out but no takers so far. Thank you very much for joining us. Any time. Consumer discretionary, hows that for a transition, the best sector in the s p 500 this month. The d again says the Consumer Spending is weak. Again the economy is a drop coming, trading nation is next. Im dr. Kelsey mcneely and some day you might be calling me an energy farmer. Energy lives here. Ready or not, here i come. Ek. anyone can dream. Making it a reality is the hard part. Northrop grumman command and control systems always let you see the complete picture. And were looking for a few dreamers to join us. Yet another kind of saywhat kind of moment. Todays gdp moment show Consumer Spending has been week. But consumer discretion fair sector of stock market is best performer. Lets bring in mat medicaller. You buy stocks now because you anticipate better stuff later, i hope. Thats the idea anyway. Does the mark at s p global anticipate, things were soft in q1 that theyre going to get better in the discretion fair . Yeah i see this as a forward issue versus the past. Even though weve seen q1 estimates and soft gdp numbers, q1 has gone so not only do we see a better q1 but we see better for the rest of the year and thats why consumers are willing to spend on the consumer discretionaries. So you see earnings going up down the road . Yeah quarter two, three and four is very positive and also net earnings. Matt youre also a skeptic. Do you agree . Its going to be important if it does, because the xly kps the consumer discretion of etf its up over more than 50 which is much better than any other groups chld the key id will looking at is the real wage growth. Hourly earnings have been coming down in the last two years but in march they bounced nicely. If that continue it should go very well for Consumer Spending. Watch for real wage growth as we move get those april and may numbers. If theyre positive its going to be positive for the group and mark as well. Watch in the yxl, it should get better. Both aaron and matt thank you very much. Go to trading nation daut cnbc. Com. Tyler. The companys going to buy back i think 500 million worth of ship . What did you say. What is that ship. Well talk to the ceo shortly. Liberty mutual stood with me when this guy got a flat tire in the middle of the night. Hold on dad. Liberty did what . Yeah, Liberty Mutual 24hour roadside assistance helped him to fix his flat so he could get home safely. My dad says our insurance doesnt have that. Dont worry i know what a lug wrench is, dad. Is this a lug wrench . Maybe . You can leave worry behind when liberty stands with you™. Liberty stands with you™. Liberty mutual insurance. Shares of Royal Caribbean catching waves today. New alltime highs on the back of the earnings beat and announcement of a share buyback. Stock up 6 now, up more than 30 this year. Whats ahead for the cruise operator . Joining us as he does, we are grateful, richard, chairman and ceo of Royal Caribbean. Good to have you with us. Thank you, thank you for having me back. Why buy back stock when its an alltime high . Whats the reason for it . Well, i think we are generating a large amount of free cash flow, and, you know, it is my Job Description to push it to get the value higher, and higherment we have more to go. Ill keep trying to get there. Business has been really good, and youre raising estimates for full year earnings as i understand it. Which of the various brands powers best . Where do you see the greatest growth . Well, im happy to say we are all doing extraordinarily well. We had a brand power out with the new ships, harmony of the seas, symphony of the seas, a new ship next year for celebrity which is going gang buster, and just throughout the brand, they seem to be responsive to what the public wants and our preference ratings go up. How is the nonamerican part of your business . Its not often i say every business we have around the world is doing well. The u. S. Market is doing well. Canadian market is doing well, europe is doing very nicely. China has been a terrific success for us. In fact, throughout asia, we are seeing australia, all of asia, just going very well, so there really is, in fact, i cant remember a time when so many markets all seemed to be lining up and away. Im running out of questions because everything is going well. What is your favorite cruise . Where do you like to cruise most . Well, you know, i never answer that because we have 400 different cruises. Yeah. I will tell you one of the things that was very exciting to me is an announcement, not just the one we made today where we basically said were doing what we said we were going to do, and its continuing to work well, but made an announcement yesterday that i was just tickled pink about. That is, that weve teamed up with the mulala foundation to support education for young girls, and so happy to be teamed up with them, and, in fact, will be the godmother of the next celebrity ship coming out next year. Wow. Congratulations on that. Really exciting to be able to work with somebody so special, and reflection of all the people at Royal Caribbean that work so hard, the foundation relates to them just made me feel so energiz energized. Its coming on the heals of 2. 0, a good time for us. I have to ask you, you said to tyler that youre seeing strength pretty much around the world, analysts hone in on weakness in china, and said, perhaps impact of ban on travel. What are you seeing in terms of demand . Well, the chinese demand has been excellent. Unfortunately, they have a dispute with the United States and korea over the Missile Defense program, and so they symptomed chinese from going to korea, forcing them, and thats painful, hurting us, and we had something remarkable similar three years ago when china got into a dispute with japan over the three small islands off the coast. Same sort of thing happened. It required us to reposition ships. I imagine china three years ago was not as big part of business or driver of growth as it is today. Concern this dispute could last much longer and impact results for a longer amount of time . Yeah. Theres no question. We dont know how long it lasts. Certainly, the government doesnt give us any hint of that. We hope it turns around. No, were not counting on it turning around. We have to reposition ships. That is, of course, one advantage of being in the cruise business. We can move our ships around. We can go to different itineraries, go to japan instead of korea, that sort of thing, but, yeah, if it continues as it is this year, itll be the one negative note on otherwise nice business. Thank you for coming up. Thanks for having me. With e trades powerful trading tools, right at your fingertips, you have access to indepth analysis, level 2 data, and a team of experienced traders ready to help you if you need it. Its like having the power of a trading floor, wherever you are. 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Thats our guest. A handsome man. Hes going to be milking it. No comment. Thank you for watching. Closing bell starts now. Welcome to a special edition of the closing bell, im sara eisen in for kelly evans. Im scott in for bill griffeth. Stocks approaching the thousand dollar level, which one is the better buy . Hear from both sides of the debate. Better than expected earnings, but worst