Schools closed live on the ground with the very latest power lunch starts right now thanks, mel. Welcome back im Brian Sullivan dow hitting session highs up 110 points s p 500 trying to make a fourday losing streak, industrials, energy and tech leading Consumer Staples and utilities lagging. Individual companies to watch include lululemon. Shares soaring beating estimates, boosting outlook. Dollar general a nice bump topping expectations and check this ut. Ge up 2 unfortunately, because the struggling industrial giant saying it will lay offanother 12,000 people. This tile, tyler, in its power division. Thank you, brian. Bitcoin, bitcoin, bitcoin. A rhyme i could make but i wont. Wall street and main street getting caught up in the frenzy. Bitcoin, hitting 16,000. 16,000 for the first time today. Then just moments later, 17,000. And then 18,000. Then 19,000 on coin banks. Right now, on somebodys base, its 15,360. Mr. Pus pisani at home base. Keeps going up and up, firms involved in futures getting nervous. Ahead of the Futures Industry Association sent a letter to the chairman of the cfdc laying out their members concerns saying more discussions are needed among regulators and exchanges in clearing houses and firms what the right margin should be and trading limits clearing firms are especially concerned because potentially they could be absorbing excess losses from what they call a volatile bitcoin market. Simply put saying wait guys. This thing is moving 1,000 an hour margin 30 and bitcoin drops 50 we clearing firms are potentially on the hook for part of that money. It could be a lot. This is only part of the debate. The main issue is, whos regulating bitcoin in general . We know the cfpc regulates Bitcoin Futures but the cash market what we quote every day is unregulated, folks. The s. E. C. Already turned down bitcoin bcs because they are unregulated. Not clear if this is satisfy the se ecke. And the wallet guys, between investors and bitcoin and the actual bitcoin itself is another whole gray area of regulation. Bob, i mean, the fia represents the big firms like the Goldman Sachs, citi and morgan stanley, et cetera. Is there the risk potentially these institutions do not step in and, therefore, the liquidity will not be there when the futures contracts start trading . Because of the perceived danger the fia lays out no. Remember, weve never really talked about clearing. Its very important. Basically the intermediaries step in, you bought something . Sold something were guaranteeing these people talking be representing the clearing firms themselves probably 60 out there saying, wait we want more consultation whats the margin levels that they should be here obviously saying we think a lot higher, because if things blow up and the margins dont cover what is necessary, potentially those people in the clearing firms themselves could be on the hook for what is left over thats a legitimate issue, when bitcoins moving 1,000 an hour. Normally you dont have these discussions because you dont have this volatility coming out. Here its a legitimate issue. Thank you. And bitcoin and other things one of six things concerned about for the next year. Joining us first on cnbc with his 2018 blaybook, bill gross. Bill what do you think at bitcoin . Good morning. Well, bitcoin, it goes up, doesnt it doesnt go down. For bitcoin you know, being looked at as an investment to be a functional currency, really, its place in this future society, it has to earn the historic currency of any country, its got to reduce volatility similar to the pound or to the euro relative to the dollar, and has a long way to go with regard to that in terms of volatility i wouldnt buy it here until the lava cools i guess, until volatility comes down and becomes clear governments are not going to regulate it. Would you buy it al all not here at this price, but you can do whatever you want youre unconstrained, after all, bill would you buy it you know, the unconstrained fund is a very conservative fund so its not bitcoin related. Let me give you examples for those speculators and might see sfla value in bitcoin an alternative to the dollar or alternative to the Global Financial system, and supposedly theres only going to be 21 million bitcoins in existence and theres 52 trillion dollars worth of m2 and m3 on a global basis. Divide 52 trillion by 21 million i dont want to tell what you that number is, but its not 18,000 its much higher so if bitcoin ultimately and im not saying it will, dont think it does. If ultimately it become as global currency and replacement for some of the currencies we have now, then, you know, its got a way to go in terms of its value, and in terms of its limited supply the most incredible stat ive heard this week came from bank of America Merrill lynch that said, bill, stocks have out paced bonds for a year and a half now first time thats happened sevenyear streak of outperformance faculties since 1928 and third time ever in 220 years of American Financial systems. Does that worry you at all i mean, when i hear those kind of comparisons, 28 was not the best year to compare anything to. Well, you know, it all worries me bonds worry me, too, because all asset prices, in my opinion, brian, perhaps bitcoin as well, are artificially inflated based upon the creation of credit and the you know, the presentation by Central Banks of buying 1 trillion worth of bonds or Corporate Bonds on an annual basis and until that stops, then this artificiality, not just the bond market with negative Interest Rates in parts of the world, but artificiality in terms of high pe ratio relative to that, you know, it is going to be suspicious. So i would be very cautious from this point forward ive been cautious as you know for 12 to 18 months and unfairly so i guess relative to the market, but i think at this point were reaching a point where future returns are going to be limited. You know, artificially inflated could be a good thing in the short term pap good thing in the long term or terrible thing in the short or long term. It everybody continues to buy, we keep going up, bill, do you have an idea when were going to see if there is this artificial sort of central bank bid under so many assets, when that comes off sure. We know that to a certain extent we know the feds cutting back and basically selling in a limited way in terms of their 4. 5 trillion portfolio we think the ecb will cut back in a month or two the end to this infusion i suppose of credits is certainly moderating and at some point in the next 6 to 12 months will flatten out. At that point its up to the economy and up to inflation nominal gdp growth to point the way towards valuations Going Forward. Up to this point, Central Banks, corporations, brian, back there with the stock those two primary factors are diminishing. Lets look to the economy Going Forward and tax cuts for value or lack of value. Quickly, with the yield curve flattening do you see recession in the next three years in the u. S. No, i dont i think fed funds should be capped at 2 higher than 2 , which might flatten or invert the yield curve, then a problem. Until that point, no, i dont think well see recession in the near future. All right bill gross have a happy holiday see you in the new year. Thank you. Thank you, brian, you too. Coming up in the next hour, more on what else . Bitcoin with bart chilton, former commissioner. Tyler, see if he thinks the governments are going to ultimately come down on your favorite bitcoin. Thank you. The big story in washington, watch closely, meantime on wall street, will there be a deal to keep the government open in two hours, senator Charles Schumer and Representative Nancy Pelosi or as the president often calls them chuck and nancy, will head to the white house. Eamon javers is there. And Kayla Tausche from capitol hill. Chuck and nancy are coming to the white house meeting with paul and mitch, the republican leaders. All on a firstname basis. The big four leaders a bipartisan meeting they couldnt execute last week because of a flap over the president s tweets democrats pulled out of the meeting, but a lot to talk about and are back today including this Government Shutdown showdown some fighting on capitol hill over exactly what theyre going to do here with a twoweek extension. Socalled continuing resolution, whether they want that to punt from tomorrows deadline to just before christmas or just after christmas and democrats want to see action taken on daca, the immigration provision given so much attention and a fight about defense versus nondefense spending all of that to be talked about here at the white house at 3 00. Well get a briefing from Sarah Huckabee sanders at about 1 30 you can expect they will be asked to weigh in to the controversy over al franken. Senator from min mine announced earlier today hell be resigning in a few weeks a lot of stuff swirling around here at the white house. Well wait and see what they say on any of those subjects watch the body language in that meeting to get a sense whether or not were heading for a showdown at the end of the week or end of the year. Eamon, thanks very much get to Kayla Tausche for more on what a yield could look like. Reporter both chuck and nancy said separately on the hill this morning they dont want to see a Government Shutdown n shutdown that has not been the democrats position historically. Republicans are trying to whip the votes making sure they have enough to pass this continuing resolution within their other party. Gop leadership has been working with the Freedom Caucus back and forth over the last several kays and House Speaker ryan feels good where they are now leading into a vote this afternoon to that end, mark meadow, chairs the Freedom Caucus, believes the Freedom Caucus will give them the votes to get just over the line of 218, what they need. That vote coming later today the senate could also vote as soon as today, if that is something that leadership chooses to do. What happens next is really the variable at this point, because this continuing resolution which will likely be two weeks would set up a potential Shutdown Scenario just three days before christmas, but one of the points that the Freedom Caucus has wanted to make sure to negotiate is longerterm funding for defense. That would most likely gee through the fiscal year in september and also buy republicans time on tax reform so they can worry about Spending Priorities after they go ahead and get that conference done well see exactly how that pans out and what exactly theyre voting on today. Interestingly, Minority Leader Nancy Pelosi said that she hopes the president will bring a new deal to the table. We were concerned when the president started mocking the meeting, saying there would be no deal and all that and i thought, well, if youre not ready to talk, then were not ready to come. Now he has made the overture for us to go hopefully that means hes more receptive. I assume since he invited us he will have an offer to make. Reporter the white house wont comment on what exactly the president plans to offer. Thank you, kayla. Your next guest doubts it will come down to a showdown. Saying its not in anybodys real interest. Maya, welcome good to have you with us. Thank you. Explain your reasons here on the face of it it would seem nobody seems to win when we have these temporary Government Shutdowns, but how meaningful is it, if youre going two weeks at a time in terms of funding that doesnt feel responsible to me. No that doesnt feel like how we should be budgeting, does it . We often do this massively short term moments on budgeting and should certainly not be bog thadoing that it is no not in the democrat or republican interests to have a Government Shutdown. I think well get through the next deadline without a problem. Thats not to say things will go smoothly here in washington because we have so much Unfinished Business and about to switch from the process with tax reform, which went stlu reconciliation, can be done with republicans only, moments that have to get done but need bipartisan support the mood here is not bipartisan at all. You dont think why do you think that, maya . So what are among the things identified there a lot of things that then have to go through what i call regular order or whatever is the term of art, but what are those critical things that will require some bipartisanship . Right and regular order should not be budgeting two weeks at a time as pointed out. Right. After we get the tax bill done and they still have to work out differences in conference, that opens wounds. People feel things important to them and were promised they didnt get this important issue of the spending sequester on Discretionary Spending how much on defense and how many on domestic Discretionary Spending will be increased above the sequester caps because the truth is, nobody want to comply with those caps but theres a difference between republicans and democrats between how much increase should go to defense or other parts of the budget thats very expensive, potentially, and going to be very important its not negotiable to a number of members but on top of that, theres a, another sequester people dont know about, but because if the tax bill goes through and planned and adds 1. 5 trillion to the debt at a time we cannot anoord, an automatic sequester to a lot of programs we assume it will be waived but maybe not without issues as well other things the c. H. I. P. Program needs extended and obamacare that people dont want. So many variables, no goodwill and very little time. Maya if there were one issue that could derail the whole process and do what you think is unlikely, cause a Government Shutdown, would it be one of those actual budgetary issues or Something Else efforts, for instance to tie this to immigration, the daca issue . Yes more likely to be some of those less budgetary related issues, which are more important, less in the dollar sense, less in the budgetary sense and more in that there are a number of people, those are their top tier ish i and ask and that could been heated and charged and a whole lot of external events going on as we see every day watching the news that could blow up any one of these very sensitive negotiations. Maya, thanks. Appreciate your perspective. Thank you. Coming up, how will tax reform affect the appreciate equity and real estate markets well ask a bill nionaire next. And jim cramer speaks and a live report from the sce onef a los angeles wildfire when power lunch returns zar one of our investors was in his late 50s right in the heart of the financial crisis, and saw his portfolio drop by double digits. It really scared him out of the markets. His advisor ran the numbers and showed that he wouldnt be able to retire until he was 68. The client realized, i need to get back into the markets i need to get back on track with my plan. The Financial Advisor was able to work with this client. Hes now on track to retire when hes 65. Having someone coach you through it is really the value of a Financial Advisor. Three quarters of the year private equity fundraising jumped to rising levels. The number of deals executed during that time was down 11 year on year what can we expect in 2018 and how will the new tax bill mean for the industry bring in one of the largest voices, foe founder, ceo tony wrestler thanks for your time thanks for being with us. Thanks for having me. What your anticipated outlook for appreciate equity given an expected major tax cut for corporations well, i think generally speaking as you mentioned, theres an enormous amount of dry powder in private equity i dont think were completely clear on what this tax reform will mean, the ability to borrow its pretty clear that 23 youre if youre a reasonable Company Borrowing as reasonable rates, not a big impact. Accessibility to borrow, which is the target of the legislation. Generally thinking we think of private equity as continuing to be a very strong industry. Low Interest Rates, high prices. Whether in private equity or real estate. Most Asset Classes in todays world. It mean as focus in private equity for those in this business for an extended period of time is to focus on companies that can grow their cash flows in a meaningful way. Youre not making your investors money by buying attractively in todays world. Youre making your investors money by building the businesses that you buy to become better to become more efficient, et cetera nap is the key to the private Equity Industry. Tony, to drill down on what youre saying about the ability to take on debt. Is it because there are provisions now that would eliminate the ability of companies to deduct interest and companies reliant on the debt market have to effectively pay more more ability to lever up a company you buy is going to be more limited or going to impact your returns well, again, as we tried to highlight at the outset, those companies that are able to grow its cash flow, i think are going to be far better off and yes, Certain Companies and buyout shops that will not be able to use that last turn of leverage far as im concerned thats good for the industry it might have an impact on certain borrows, issuers but generally speaking the private