gains of the day two weeks ago the dow hit 25,000 for the first time now let's get to bob pisani on the floor. >> i want to point out the dow is price weighted, the biggest prigs stocks te price stocks tend to move the index. let me show you the five dow stocks that contributed most this is a 1,000 point gain from 25,000 to 26,000 boeing is 34% of the gain. one stock is a third of the gain caterpillar, united health, home depot, 3m. eight of the highest priced stocks in the dow. put it together, 60% of the dow's gains from 25 to 26 were five companies five out of 30 companies here. what is more interesting is the days to the rally are getting small eastern smaller. each 1,000 point increment is getting small eastern smaller. look, it took 109 to go from 21 to 22,000. after that, 53 dpays to go to te next 1,000, 23 days, 7 days. you get the point. this is more than just easier to hit the target this is definitely an acceleration it is euphoria, some people say it is. but it's an acceleration this is a global rally 50% of the earnings from most of the big companies are overseas and we're seeing tremendous moves up in markets over in hong kong hit a historic high today, hong kong shanghai, korea, spain, germany had terrific gains this year tax reform definitely has accelerated the markets' return since december 20th when the tax reform passed, analysts are raising numbers. so since then we raised about 2% higher in the last three weeks that's a very big number to raise estimates 2% for the s&p 500 in just three weeks. that's a tax reform number and that's very real also very real but hard to pinpoint down is this fear of missing out. it's not intellectually satisfying there very strong inflows into europe and emerging markets for several weeks now. also inflows into the u.s. somewhat weaker in the beginning of the year. but stronger in the last week or so these are global flows people are simply putting more money to work right now. you can say it's a blowoff rally, whatever you want to call it obviously, some people are concerned here that they're missing out and there is still a little bit more legs to the rally. right now we're off of the highs but let's just say still 26,000. back to you. >> all right for more on the rally, let's bring in david rosenburg, chief economist and strategist great to have you. >> thanks. >> this morning you write about basically whether or not the fed ends up being a spoiler in all of this. to quote you, "the fed owns this bull market and it owns the bubble that is forming." what is your argument? >> of my argument is that here we are with the output gap basically closed and we have a situation where the real policy rate is still negative the fed's balance is hugely bloated. we never have been at this stage of the cycle with fed policy this accommodative i can understand the enthusiasm in over fiscal policy. but monetary policy has a much more powerful influence. this is still the same rally that we've been in for the better part of the past eight or nine years it still has the fed's thumb prints all over it the new mantra is that jerome powell is a clone of janet yellen i think that is the thesis that's going to be put to the test over the next 12 months >> david, we had sam zell on "squawk box" this morning. he used the term irrational exuberance to describe the stock market right now what is your take on that? >> you know, i don't know if it's so much irrational exuberance it certainly is a high level of enthusiasm and now you're seeing the word the acronym fomo, fear of missing out. that he is quif lent to tis eque greater fool's theory. i hear all the time and i agree follow valuations are not a good timing tool. how can you then do expected returns on the portfolio in the future i mean even the san francisco fed in the latest letter actually said looking at different valuation metrics that the return and the s&p 500 that we overturned the next decade is close to zero. so it's been a great party at some point i think the fed will take the punch bowl away as it normally does this is very late in the game. we borrowed a tlot of future returns in this, especially the last leg of the rally. somebody just said before that the analysts raised their numbers by 2% in the past little while. the market has so far leap-frogged even that analyst consensus expectation to the point where the forward multiple right now is over 18 we've already taken out the peek forward multiple in the credit bubble peak of 2007. when you look at the multiples, price to sales on the s&p 500, 2.3 times, it's only been this expensive 4% of the time historically price to book, 3 1/2 times only been this expensive in the past -- if you don't like price earnings, price to sales, look at price to book 3 1/2 times. it's only happened 7% of the time in the past so the valuations to me right now are hitting extreme levels >> yeah. there is no way to actually paint it any other way than valuations are in the upper end of the historical ranges i wonder if you talk about the bubble word, what kind of misguided investment is going on in the real economy? what is -- what else is out there besides stretch securities valuations right now that you would point to and say there is a complete distortion in economic picture that's what we did see in the late '90s and the overinvestment in tech. it's a little hard to figure out what that might be >> when you had this situation with technology, the dot-coms in the late '90s, we came off that with full 5% growth in 1999 when the fed cut interest rates because of what was happening with long term capital in asia and that liquidity infusion alongside what they were doing pre-y2k. i remember hearing about fomo then then the last cycle going into 2002, 2003, the fed didn't start to raise rates until june of 2004 and by that time they'd already created the housing and credit bubble. they never got ahead of it finally, they ultimately had to get ahead of it. once again, they were late in the game this time around they've never been later the point i'm trying to make is this the mantra is we have physical stimulus coming. the fed is going to sit idly by. a 2.9% saving rate late cycle activity screaming everywhere and somehow the fed is just going to continue to do dribs and drabs in deficit financed tax stimulus in the ninth year of the expansion. i think that to me is what the primary risk is. the elephant in the room is always the fed if you go to the report i wrote today which is about -- it posed a question, will powell pull the punch bowl it went back to october 19th, 1955 to the famous quote where they invoked that term about the fed's role to take the punch bowl away. because we all talk about well priced stability, full employment we are operating this economy now above full employment. it's no the showing up at the classic inflation numbers yet. but maybe the fed's pursuing a faulty target at 2%. maybe today the target should be 1% or 1.5% at some point the fed will play catchup. liquidity, look, liquidity is your best friend at the height of a bull market and then on the other side of the mountain and this is just a cycle we're talking about, we'll get to the side of the mountain you're going to find that liquidity is your biggest coward. >> before we go, we're coming up on the anniversary of the inauguration you've been on our show before and asked about the trump rally and your response has been well do they call it the abe rally in japan? how much credit do you give to this president >> i think that there is some things he's done that spun the dial a few basis points. a lot thereafter is the deregulation of course, that might come at a social cost. certainly that's helped the economy along. we still call it the trump tax cut. yet, you know, donald trump didn't write the tax bill. it was paul ryan i would call it -- if you want to call it tax reform, trump tax reform, want it paul ryan tax reform or mitch mcconnell? it is congress that wrote the bill and passed the bill the president would have signed any bill that had a tax cut attached to it i will go on the record as saying that this is not just a one year rally it's not just a rally that started with donald trump who is actually saying it's a temper of 2006 when he was a candidate back when the dow was 17,000 he tweeted saying we were in a big fat ugly bubble and we better be careful. here we are at 9,000 points later. maybe it's not a bubble anymore, maybe it's just a hot air balloon. the thumb prints of fed policy are all over this party. we know the history of the fed is that they are responsible primarily even in the 1980s, it was the reagan rally the central banks are the elephant in the room how far will they start to play catchup remembering not just the balance sheet. the real policy rate is negative right now. with asset markets where they are and a 4% unemployment rate, you ask yourself going into the next 12 months whether or not you think that's sustainable >> david, great to you have. good note this morning worth reading. david rosenberg, we'll talk you to soon. bitcoin is tumbling to a six week low on the regulatory concerns our si many. a mody is watching that. >> bitcoin pairing losses after dropping 20% it is still extending the selloff from last year concerns over regulatory pushback from china, south korea and comments from stephen ma nush in. we saw five separate occurrences in 2017 when it fell 20% or more to then only rebound still, growing concerns over south korea which has been much more vocal this year about the plans to crack down on cryptocurrency trading shutting down digital currency exchanges is still a live option for the government the reason we care about south korea is that it accounts for a significant portion of trading volume in bitcoin and other cryptocurrencies the question is whether u.s. regulators will follow suit. the sec is issuing warnings on offerings but that hasn't stopped telegram, a rival to what'sapp for looking to raise over a billion dollars in its ico. guys, back to you. >> great thank you. seema mody general electric is not performing in today's raly it is off of the earlier lows. the company is considering breaking itself apart after disclosing a $6.2 billion writedown in the legacy insurance business for the fourth quarter david faber joins us now with more >> you know, this is a historic day. it started, of course with, this news that morgan just referenced, the $6.2 billion after tax gap charge the company is taking for insurance liabilities, this relates to the long term care book of insurance. it's in runoff but it is causing them a lot more pain than you anticipated or they anticipated certainly back in -- legality's call it '06 when they decided to keep it on the books but that news is now overshadowed by what took place on a conference call to discuss those insurance charges. but really what now represents the first time in the long and storied history of ge as the best known conglomerate by far of a ceo of that company saying we are considering taking it apart. take a listen to chairman and ceo john flannery on that call earlier speaking specifically about the possibility of breaking up ge >> as i look at the company and continue to evolve along this continuum, i believe there could be different structures that can achieve all of those objectives and that we need to examine those. i don't -- i would categorize it as an examination of options and it's kind of thing that could result in, you know, many, many different permtations including separately sprayed separately traded assets in any one of our units if that's what made sense >> you heard it there. any one of our units but really what i'm told by people familiar with this situation who are close to the company is this is begun the process that could culminate as soon as the spring with an announcement that ge will, in fact, pursue a split. how that will be done, what that will involve, of course, remains to be seen and certainly there are many technical issues, whether it relates to pension or taxes that will have to be dealt with but you could end up and in fact i'm told likely to end up with potentially separately traded entities for the aviation business, health care and perhaps the troubled power unit as well. >> which are -- >> quite a moment. they're the three key businesses he was going to focus on and spin out other assets whether the time comes exit baker hughes but these were going to be the three core businesses he focused on said there are no sacred cows. this review is on going and really the most direct commentary from flannery that they could actually break this company part >> he is focused on unlocking value is what people will and have continued to tell me. and regardless of what that -- where that takes them. it does appear as well that there are people on the board of directors who certainly may be pushing in that way. one would expect that perhaps trian, for example, ed garden who is on that board would be potentially considering it it's not just the sum of the parts value that may exceed, mike, the overall stock price. but the idea that by giving these units focus, separate capital allocation, the ability to attain and retract talent, attract talent that they might not otherwise be able to that you help their future and certainly the past is not been particularly good. at least for power which the company would argue has held back in some ways the market's perception of success at aviation and health care >> you would think so. i have to imagine the board is in this situation where it's not just about oh, let's unlock value. you have to benchmark what you think you can achieve through this complex conglomerate versus the stand alone aerospace valuations, for example. if you look at that and say if you put a boeing or utx valuation on anything remotely related to our aerospace, does it get you to a higher number? it's trapped i guess you're also racing the psych until some wa cycle in some way. maybe it's time to realize a separate public market value for the businesses you have. >> death of the conglomerate stories i guess. >> you imagine >> this is it. this is the great american conglomerate we're in the end stages of breaking it apart. nbc universal and ge capital have already gone and now you're left with the three main businesses it does appear, i mean you heard him. we're taking a close look. we're considering all our options and from what i'm hearing, they may actually have something to tell us by as soon as this spring >> that will be a hard wait. you want to hear more now, now, now. >> we're not going to get it they report earnings on the 24th >> next week >> after that, it may vbe very quiet. >> the board is being reconstituted. they're 18 going down to 12. >> thank you, david. a lot more to say about this unprecedented climb to 26,000. san thole wi the street's most bullish call on amazon this morning could the stock get to an $800 billion market cap this year and more regulatory concerns weighing on cryptos. the craze could be running new startups stay with us hey, need fast heartburn relief? try cool mint zantac. it releases a cooling sensation in your mouth and throat. zantac works in as little as 30 minutes. nexium can take 24 hours. try cool mint zantac. no pill relieves heartburn faster. we cut the price of trades to give investors even more value. and at $4.95, you can trade with a clear advantage. fidelity, where smarter investors will always be. amazon price target being raised to $1600 a share. in the company's advertising business is an opportunity investor sam zell joined "squawk box" earlier take a listen to what he had to say. >> if you look at amazon and you look at the multiple that amazon trades at, you could make a case that says that in order to justify the multiple it trades at, amazon needs to be 25% of the u.s. economy in five years the last time i did that calculation was 1997 and the company in 1997 was cisco. >> well, joining us now to weigh in on that and the rest of the group, victor anthony and paul meeks, chief investment officer and portfolio manager. good to see you both here. victor, when it comes to amazon, so price target is $1600 on the street that's a 20% upside. so it's not as if on a percentage gain basis it's out of the realm but what do you think about this deal about what kind of assumptions about amazon's growth and market share have to underlie a lot of upside to the stock right now? >> i think the difference compared to cisco back then in the '90s, the difference is that amazon has benefited from a significant shift to retail dollars moving over to the internet that just continues unabaltted. i think comcast is a big shot in the arm and validation for aws as a platform. i think the market for aws is just massive and they'll continue to go to top line and double digit rates. i'm not too concerned about where the multiples are right now. somewhat inflated. i do agree you adjust for growth and get better valuation on the stock. like amazon here i always said it will take jeff bezos to hit by a bus for me to change my opinion on the stock >> let's hope that doesn't happen paul, i'm guessing you also don't think you have to think amazon is going to account for $5 trillion of economic activity which is what 25% of the u.s. gdp would be in a couple of years. what do you think you have to believe in order to love amazon in particular right here >> the way i look at it is i think the stock is just a hold here i try to be contrarian and buy quality companies like this one on dips. but i would say amazon web services has to continue to grow and i see no reason that it won't. i do think that google and microsoft will take some share but aws will remain the kingpin taking more old school retail share into e-commerce where they have 50% or more in some holiday selling seasons exposure and we'll see what happens with whole foods and their onslaught into retail. there are a lot of prehistoric industries that they are disrupting and so i think the total available market is large and getting larger >> victor, i have a question for you on facebook. certainly we saw the shares take a tumble on friday after mark zuckerburg unveiled the changes to the news feed there is a the love focus what the changes will look like for consumers and this idea that maybe it will throw some cold water on advertisers on facebook platform but you wrote something here in a note that really jumped out at me facebook made several change and updates and the news feeds each change has been met at times with user and advertiser resistance but that with reduction now, we expect facebook's ad price clg is still material below other forms of media to increase in the auction market you think long term this actually pushes the price to advertise on facebook higher >> i think it does it reduces inventory for advertisers. and just about every single advertising check conducted, advertisers are clammering to advertise on the market. so it's an auction market. no more advertising pressure to advertise in front of what advertisers are telling me this is a super bowl that is occurring almost every single day. and so that will ultimately push up the price i think will offset the lower lows that i expect to happen from this news feed change >> but you also think this is a benefit to twitter which is why upgraded that stock? >> that's why i upgraded twitter from a sell to a bichlt i think user growth will continue. i think advertising growth turns positive this year employer morale, stronger. gap profitability, margin expansion and also i think the acquisition story becomes a lot more pronounced this year. i think the benefit because now i think twitter becomes more of a news platform. a lot of people i spoke to about why they use twitter, they told me i get all my news on facebook that's about to change i think that may get users to move over to twitter and come back to the platform and use it as a news source >> paul, facebook, i mean, you don't think it's game changer whether zuckerberg basically says we're going to suppress a lot of the traffic. we're going to show fewer things to our users the stock still is 4% off the highs right now. >> the way i look at it is, yes, they're absolutely right they made changes over time. this could be more significant than previous changes. i do like the fact that the company is pro active to get ahead of the things. one thing about zuckerberg and facebook's management team that people don't appreciate enough is the ability for this company to adapt and then attack we've seen it time and time again. going back to their ipo and out of the marquee fang stocks, facebook is one i would buy here >> victor, some people wonder, some written they're trying to blow up the company from the inside some wonder whether or not they're really in control of that, whether they make the changes and consumers don't respond in the way they hope >> all last year, since everyone knows i cover facebook, a lot of people come to me telling me that they were dissatisfied with the content that they were seeing in the news feed. and so i think facebook was seeing that. i think that change addresses that i think actually in spite of some of the backlash i've been hearing from the investor community, i think from a user perspective, this will be a not more positive. this is positive for the long term health of the platform. i think ultimately time spent which mark zuckerberg would diminish, that increases over time as well >> all right that is the company's bet. we'll see fit works out. victor, paul, thanks a lot for your time this morning >> as we head to break, taking a look at the stocks leading the dow past the 26,000 milestone earlier today. boeing, merck, caterpillar and united tech. 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(barry murrey) we would save a lot of lives if we could bring the doctor to the patient. verizon is racing to build the first and most powerful 5g network that will enable things like precision robotic surgery from thousands of miles away. as we get faster wireless connections, it'll be possible to be able to operate on a patient in a way that was just not possible before. when i move my hand, the robot on the other side will mimic the movement, with almost no delay. who knew a scalpel could work thousands of miles away? ♪ good morning once again, everyone here's your cnbc news update nato saying the campaign against isis is changing from combat to stabilization. allies gathering for their first meeting of the year to announce the changes. afghanistan's national security also among the topics on the agenda military cooperation is important. but only when kbinld with tcomb range of other elements such as the economic, judicial and social can a us is stained and lasting effect be achieved tripoli's airport remains closed following clashes between heavily armed libyan militia that left at least 20 people dead 63 more were wounded airport officials say they hope operations will resume by tomorrow new research suggests weight loss surgery can provide long lasting health benefits. one study said surgery on obese adults helped with diabetes and another said patients may actually lower their risk of early death. that is the news update this hour back downtown to "squawk alley." carl, back to you. >> all right thank you very much, sue legality's get to seema mody and get the european close >> carl, most of the european markets pulling back from the highs of the session in fact, earlier today the ft-se 100 rose after data showed a slowdown in uk inflation but has since been dragged down by the miners as gold and copper prices drop. here is some stocks in focus bp also weighing on the ft-se. the oil giant says they'll take a $1.7 billion charge in the fourth quarter due to settlement claims related to the 2010 gulf of mexico oil spill. bp also announced a separate $1.5 billion accounting charge in connection with tax reform in the u.s. that stock down nearly 3%. a difference story for hugo boss, a german fashion house posting strong quarterly earnings helped by a 42% surge in online sales and 11% sales jump in the u.s. they have been in the midst of a restructuring program after a string of profit warnings. we fin wish a look at roesch following after merck announced a drug extended lung cancer survival in a combination trial. that stock down about 3.5% back to you. coming up this morning, our john forwad is on assignment we're hoping to bring you that by the end of the hour art cashen is going to join us and talk about this milestone day as the dow crosses 26 k but turned around a little bit lost about half of the gains stay with us records across the board holding. the s&p 500 hitting 2800 a shade below that for now art cashen is here at post nine, ubs director joining us. we had you on on the fourth. i was looking back to see what your comments were as we crossed 25 k back then you said new money for a new year it's got to get placed and puts us in reasonably good stride anything changed >> not much. pretty much the same story encouraged by the deregulatory backdrop you're hearing a lot of people talking about the benefits of the tax reform plan, what it's going to mean to earnings, better earnings. therefore, decent pes. so they're moving along. we've backed off 26,000 here on a slight geopolitical chill. there were rumors out that turkey was massing troops along the boarder wirder with syria a would that lead us better safe than sorry we still have half the gains in. >> all right i was going to say the dollar kind of on a continued decline seems like operating in the background, you know, it's part of the whole story i wonder how you think it filters in is it just, you know, kind of a represention of t representation that we have a lot of liquidity are they being closer to being done where does that fit in the mix >> it does have grate dea great with central bank versus central bank i think it's a factor. i don't know that it's a compelling one i think a lot of the other rationalizations around tax reform and deregulation are somewhat more important than most investors >> what is your take -- you've been on the floor for a long time you've seen a lot of things play out here >> over 50 years >> yes this news on general electric potentially breaking itself up what do you make of that >> in some ways it was for decades a one man miracle. jack welch ranit ge capital was a key factor when he was managing things in fact, the cynics used to call it ge capital was the jack welch hedge funneled whid which allowo dial up earnings on target wlfr they needed it but whether 2007 came along, all of that changed. the famous would be bailout of ge so those factors changed and now we're learning that some of the operations under mr. immelt may not have been what a lot of people assumed them to be and the new ceo does seem somewhat more intent on break things up a little bit maybe make it a lyttittle narror and easier to manage >> does it prestage a new era of m & a you think going into '18 >> it could. it's one of the only areas where you're seeing conscious downsizing i mean they were the poster boy for conglomerates back in the old days so they were in many diverse and some people's minds nonconsolidatable if that's a word, into running a package so we'll wait. i think they're a little bit an exception. i'd like to see it begin somewhere else before i spot it as a trend >> the ten year, last week's scare, are we going to remember that in a month? >> i think you may you know me, i'm a guy who doesn't see any rapid rise in interest rates here. i think my theme for 2018 is keep your eye on inflation it is not going to be as strong as many people think and i don't think that mr. powell wants to get himself rushed in to making a rash move in rates i think the fed will be somewhat reluctant. >> we just had rosenberg saying punch bowl, the whole fed punch bowl theory is back in play. >> i heard david i have a great deal of respect for him. it's one of my favorite quotes anyway william mcchesney martin is the youngest president of the new york stock exchange. he got the job when he was 31 before he went to the fed. but i would think -- i'll let david stick with his side. but i'm waiting to see if inflation doesn't come out robustly than i think they're going to drag their feet >> talking about inflation, whether does crude become a bigger part of the conversation looking at markets i mean certainly a little lower today. we're still near three year highs. we have the reports now that u.s. production could hit all time record highs in the coming weeks. at what point does that become a head wind? >> well, it depends. right now the hedge funds are all playing in oil because they think it's going to be in saudi arabia's interest to keep the oil price respectable going into the deal so they're counting on that. i tend to think that we'll get to see oversupply again there soon maybe it is the deal i don't know but maybe when the weather gets a little more tolerable, they'll be out in the field again. >> and again, do you have a closet full of hats going all the way to 30 k and above? >> i don't want to be rash and tempt fate but we'll try to keep with -- we have a guy who can sew very fast. >> art cashin, when we come back, the cryptocurrency craze could be killing some startups she'll explain dow up is 164. rick, what are you watch sflg. >> -- watch sflg. >> we crossed over 26,000. i think it's exciting. there is some froth and body how do you break down which is which? that's what we're going to talk abt tethbrk.ouafr e ea coming up, as the dow breaks 26,000, why some are saying the market overshoot is underway what does it mean for your money? we'll debate that. plus, the stunner on general electric the company considers breaking up our david faber brings us the latest then our traders debate what it means for the stock. and green light's david einhorn. >> a lot to work with today, scott. thanks >> julian manis joins us from structure capital. >> good morning. >> you make the point which we teased before the break that the phenomenon of icos is altering the way founders think of creating companies >> yeah. >> what do you mean? >> it is but it is dangerous. it is very dangerous on one hand we want to be supportive of this because this gives opportunities to definitely to fuel new companies. on the other hand, there is a lot of irresponsibility that goes with this there is a lot of thought that is being created because icos, if they're based on a white paper and just raised on that, then that's a problem. and that's a scam. but on the other hand, if they have sec filing, if they have packages, due diligence packages, if there is some product that we can invest in, then i think that's an interesting opportunity. but i see this as a tool rather than a currency. i see cryptocurrencies as an ability for companies such as kodak, you have the kodak coin and that was fascinating jeff clark came from orbitz. he said how am i going to take this company and make it relevant how am i going to take this company and make it innovative he created this kodak coin i think that created loyalty it solved one of the biggest problem. 90% of photographers photographs are not monday he tiesed they can use the coins in an innovative way but on the flip side, there is a danger in these young startups with no responsibility we're investing in people. we don't invest in how much that they're raising. >> so it doesn't bother that you the kodak coin was roundly ridiculed in some circles? >> that's absolutely -- so is bitcoin being ridiculed. and so are all the cryptocurrencies and blog change to a certain extent. i think until we have some sort of understanding on the applications and, of course, there is going to be volatility. but don't, you know, everything that is innovative coming from the silicon valley is criticized first. then you see youtube youtube went through a very hard time now youtube is having this tremendous velocity. you're sig eeing instagram. it's the adoption of a new innovative way i'm not going to dam anything except for the scams that are being -- that are being basically, you know, ridiculed across china, korea. that's where there is a shutdown and the lack of transparency >> whether you look at about itcoin ait bitcoin and the other cryptocurrencies, increased discussion about regulation both here in the u.s. and throughout the world. so the multibillion dollar question, how do you regulate without stifling that innovation >> i don't flow if you can to tell you the truth it's almost like an oxymoron in one case we do want some regulation around that but how far are we going to go i think it's very fascinating what venezuela is doing and japan is doing is creating this sovereign currency i think that is still an inharnlti ininherently will create optization i think regulation is what we're talking about is transparent we're really trying to talk about accountability i think that there has to be new regulation as in every new industry when we had ebay and we had the trust and safety issues around ebay, there was policy created from that. i don't think the regulation is in place right now i think it has to be created i think this is the wild west without a sheriff. >> you are looking for it to come from any one country or any one part -- who is going to lead on this? >> i think the u.s. needs to lead >> even though the majority -- i don't know, we're still looking at the locust of the trading around the world >> but we're the epicenter of innovation we need to lead the way. we need to show how these applications will work i think that there's tremendous, tremendous value and block chain. i think has been applied to every single industry. i'd like to look more on the health care. i mean what alphabet is doing in health care, you know, we have google we now have amazon potentially having health care you have -- that's an area that needs to be really watched it's block chain that is going to be fueling. that's the turbo tech boost. i don't think it's the cryptocurrencies >> we saw that today we had an announcement from ibm that they're using block clan hain t create a trading platform. >> absolutely. and you have $800 million invested into verale that creates this data set of health care to inform more health care policy i think that's how it's going to be use that i >> we hope you'll come back. there's a lot to talk about. >> there is a lot to talk about. thank you. >> structure capital >> as we head to break, take a look at the dow. it is up 151 points right now. 25.953 aerft cross iing the 26,0 threshold earlier in the segts stay with us hi i'm joan lunden. today's senior living communities have never been better, with amazing amenities like movie theaters, exercise rooms and swimming pools, public cafes, bars and bistros even pet care services. and there's never been an easier way to get great advice. a place for mom is a free service that pairs you with a local advisor to help you sort through your options and find a perfect place. a place for mom. you know your family we know senior living. together we'll make the right choice. getting breaking news on the mueller probe. kayla? >> carl, this news is coming from "the new york times" which just put out a report saying that bob mueller, the special counsel, has sent a subpoena as of last week to steve bannon the former campaign chair and white house strategist and this is a report accord tog a single source a person they say has direct knowledge of the matter and that the move marks the first time that the special counsel is targeting a member of trump's inner circle with this grand jury subpoena. so we'll see what other details come out of this bannon was testifying today in front of the house intelligence committee, but it appears now that robert mueller wants to speak with him as well >> kayla, in the meantime, let's get to rick santelli in chicago. ri rick >> good morning, carl. you know, rosy was on h this morning. he's an economist on this trading floor that commands much respect and many, not including rosy, but many have been looking over the last several years really back to around 2010 to 2012, trying to think how much of the stock market is true valuation. how much is fed? how much is is fed inspired and especially after the november 2016 election, if this will become a real past time among many investors what i say is there's some very easy ways to eliminate froth then and try to come up with what we have left is substance back to the dow jones industrial average to before the crisis 2005 now, in my opinion, the peak was around october of 2007 right around 14,000. now anybody who has studied technical analysis knows that when you go basically from 14,000 to 6547, that not all of that is true value that's eroded it's a market getting ahead of itself think bitcoin to the upside. now i can say think bitcoin to the downside so we have an answer called cross the canyon. so what you try to do is you try to find something after the big break that gives you value and to me, that area is this blue line around 11,000. because it was the first major top. we did some corrections. came down and held it. so 11,000. so in my opinion, the 11,000 mark in all of this is cross the canyon we crossed the canyon. that's the market overdoing a down move. the it's pure and simple now we have 11,000 to about 18,000 should be some percentage of that is fed inspired even if you say all of it is say all of that 7,000 should really be there. in my opinion what happened in november when we basically shot up aquite a rapid pace from roughly what, 18,000 mark all the way to where we are today at 26,000, we could argue that all day. i think real value i think that's the market saying pro business, tax cut, we can do things companies coming bag, we don't have to worry about inversions puts building the wall back in play no, not that wall. the wall to keep business in so let's take the worst case snacenario. if we are 26,000 and we have to subtract 7,000, say that means there's 19,000 of real value that's shocking, right but that's still higher than this market was before the election so if anything, all of this has been a great shock absorb re ear that's the way i'd look at it. back to you. >> thank you very much we are watching in the meantime, some of the gains that are lost intraday transports are back to pretty much the fwing of friday and we've been talking to santelli this morpg about the risks the market holds for an overshoot. >> the risk is that we got so stretched on sentiment, on momentum what rick's pointing out there is all the house money that's built up here and the psychology attached is we probably are not going to feel like there's not anything really that nasty going on the overshoot idea is that we're beginning this phase of public enthusiasm where the market runs ahead of the fundamentals a little bit and that can last a little while as long as the credit market is cooperate, the fed doesn't get in the way, you never know how much the demand outstripping simply of risk can go. >> i wonder how much of a risk it is that we've seen the dollar stubbornly weak against other major currencies even as we move closer to full employment. there's this expectation that tax reform is going to power earnings and at least in the short-term, economic growth overall and yet, we have this dollar that is -- >> totally counterintuitive. on the other hand, it also represents high liquidity throughout the world it's part of what we talk about as being loose financial conditions, so in a way, it's kind of supporting this whole story. even though it doesn't really follow the script of a great economy and the fed looking to tighten up one >> meanwhile, al kelly speaking to john ford in washington a year into his tenure, talks about the future of payments, the rise of the kryps toe currency and the impact of tax reform on his business take a listen to what he told john exclusively about the company's 401(k) increase following gop tax bill >> i wanted to do something that was sustaining and long-term and i felt that you know, kind of a one time bonus felt gimmicky to me, to be honest with you i looked at the data very high participation in our 401(k) program that signalled to me very clear ly that employees valued it. and so i felt that if they valued it already, if we could enrich it further, we went from double matching the 3% of your personal kopt bugss, you put in 5%, we put in 10%, i think it goes a long way towards making our employees feel very good about the company. but good and smart as consumers and i think it's going to get the people who aren't in the 401(k) program, which is few, to come in and i really love the fact that it's got to long and sustaining asfepect to it and that's what i i think is the magic of the move. >> that's this morning >> and carl -- >> the list of companies is about 160. nearly 3 million workers tole. >> yeah. al kelly said it would been on his list to do, but the tax reform actually bunked it to the top of the list and he was able to make the case to his executive team that they should do it now. for more on the interview, tune in to us and squawk alley tomorrow and to the ft. knox podcast h this weekend you can hear the whole conversation >> good to see you look for that tomorrow at 11:00. csx tonight going to keep things interesting. let's get to the judge and the half >> welcome to the halftime report top trade is hour, market milestones the dow crossing 26,000 for the first time showing no signs of slowing down anytime soon it's no wonder some are wondering now whether the rally has gotten too hot and how much longer it can really last. with us for the hour today, joe, stephanie, josh, john. we dpin of courbegin with the ms stoxs surging to start the trading week a full week of earnings as expectations continue to climb joe, it's below 26,000 now, but it krosed it earlier now people are tleing out th

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