Transcripts For CNBC Power Lunch 20171206

Peace process. The president s announcement could have serious ripple effects on the world even the pope is weighing in recognition of jerusalem is the news from the president of the United States. This marks a departer from democratic demonstrations of the past here they continued to keep the embassy in tel aviv not moving into the touchy question of what the status of jerusalem ought to be the administration will not move to jerusalem immediately they said the process will be kicked off by the president of the United States. It could take some period of time, possibly years before an embassy is built in jerusalem and the site located and security put in place and the Embassy Opens and begins functioning in jerusalem the president is expected to recognize that it is the capital and that is expected to touch off reaction among palestinians who very much view East Jerusalem as the capital of a palestinian state. We will see what the president has to say here at the white house in a couple of minutes we will carry that live lets get reaction on the ground nbc newss ron ale is in west jerusalem now. Here they love donald trump and people feel the announcement and the recognition is long overdue. There was a big plan for a huge celebration here tonight they delayed it because its so cold and rainy tonight people are glad to hear this its a sign that says god bless donald trump we were talking to the mayor and he is thinking this may actually help the Peace Process essentially it draws a clear line the israeli position is that jerusalem will be the undivided capital of this jewish state forever. On the palestinian side, we are hearing talk of days of outrage and uproar so far today that has not materialized, but people are perhaps waiting to see if there is any nuance or finesse in what mr. Trump has to say as the negative reaction came in from around the world and from the vatican and elsewhere, the white house has been hinting and saying that mr. Trump is going to talk about how this does not preclude them and its an issue of status talks. There is language in what the president is going to say that might ease the palestinian sides fears, but again that is bringing jerusalem into a conversation that has been just veamentially negative. Here a feeling of relief and also a feeling of concern. People are concerned about the reaction the Israeli Security forces of course are prepared and on alert and ready to handle any eventuality. The mayor when we spoke was insistent that israel would not be deterred by the threats and concerns about violence and a negative reaction. So thats what you have here a feeling that this rec snigz long overdue and people when you talk to them there is concern about the reaction about the outrage and whether this will make the conflict better or worse. Back to you. Ron, let me ask a question from an ig nof apt americans perspective. We think of, many of us because the embassies are in tel aviv that that is the functional seat of government for israel if we were to visit jerusalem, would we think that was israels functioning capital . In other words, are the Government Agencies and the ministries and so forth present there in jerusalem now so that in fact it truly does function as the countrys capital yes, it does. The government is here if you have any government business, its all here in j jerusalem. They do not recognize the claim to jerusalem. The eyes of the outside world is at illegal occupation and the status needs to be negotiated in a process. That is the International Position thats why the u. S. Moves the embassy here it would be the only nation in the world to do so there is now talk others might follow and that is what the Trump Administration is hoping for. It is purposeful that there are no embassies here. That would serve as recognition and the nations of the world do not want that to happen. We will see. The embassy situation could be moved in a matter of moments they hang a different sign on the consulate here and they are delaying it and saying they will build a new nblg a new place and that may take time that may be how they are soching the blow thats the much more important statement. Thank you very much from jerusalem from nbc news. Indeed when the senior officials spoke with reporters, they said it would take several years before they did the moving we are inside the twominute warning for President Trumps announcement related to the recognition of jerusalem of the capital of israel. The acknowledgement that we will keep it short, the nato ambassador and the Harvard Kennedy school and a cnbc contributor. The president of the endowment, if i can ask you to keep it short at the beginning in case the president walks out. What do you think . This is long overdue or a bad idea how old on im sorry. We will interrupt you. Just as i asked that question, outcomes President Trump and Vice President pence thank you when i came into office i promised to look at the worlds challenges with open eyes and very fresh thinking. We cannot solve our problems by making the same failed assumptions and repeating the same failed strategies of the past old challenges demand new approaches my announcement today marks the beginning of a new approach to conflict between israel and the palestinians in 1995 congress adopted the Jerusalem Embassy act, urging the federal government to relocate the American Embassy to jerusalem and to recognize that that city and so importantly is israels capital this act passed congress by an overwhelming bipartisan majority and was reaffirmed by unanimous vote of the senate only six months ago yet for over 20 years, every previous american president has exercised the laws waiver, refusing to move the u. S. Embassy to jerusalem or to recognize jerusalem as israels capital city president s issued these waivers under the belief that delaying the recognition of jerusalem would advance the cause of peace. Some say they lacked courage, but they made their best judgments. Based on facts as they understood them at the time. Nervous t nevertheless the record is in. We are no closer to a lasting Peace Agreement between israel and the palestinians it would be folly to assume that it would produce a different or better result. Therefore i have determined that it is time to officially recognize jerusalem as the capital of israel. While previous president s have made this a Major Campaign promise, they failed to deliver. Today i am delivering. I have judged this courseof action to be in the best interest of the United States of america and the pursuit of peace between israel and the palest e palestinia palestinians this is a long overdue step to advance the Peace Process and work towards a lasting agreement. Israel is a sovereign nation with the right like every other sovereign nation to determine its own capital. Acknowledging this as a fact is a necessary condition for achieving peace. It was 70 years ago that the United States under president truman recognized the state of israel ever since then israel made its capital in the city of jerusalem. The capital the jewish people established in ancient times today jerusalem is the seat of the modern israeli government. It is the home of the Israeli Parliament as well as the israeli supreme court. It is the location of the official residence of the Prime Minister and the president it is the headquarters of many government ministries. For decades, visiting american president s, secretaries of state, and military leaders have met their israeli counterparts in jerusalem as i did on my trip to israel earlier this year. Jerusalem is not just the heart of three great religions, but it is now also the heart of one of the most successful democracies in the world over the past seven decades, the israeli people have built a country where jews, muslims and christians and people of all faiths are free to live and worship according to their conscious and according to their beliefs. Jerusalem is today and must remain a place where jews pray at the western wall. Where christians walk the stations of the cross and where muslims worship at the mosque. However through all of these years, president s representing the United States have declined to officially recognize jerusalem as israels capital. In fact we have declined to acknowledge any israeli capital at all today we finally acknowledge the obvious that rejuijerusalem is israels capital this is no more or less a recognition of reality it is also the right thing to do its something that has to be done that is why consistent with the Jerusalem Embassy act, i am directing the state department to begin preparation to move the American Embassy from tel aviv to jerusalem this will immediately begin the process of hiring architects, emergencies and planners so a new embassy when completed will be a magnificent tribute to peace. In making these announcements, i want to make one point very clear. This decision is not intended in any way to reflect a departure from our strong commitment to facilitate a lasting Peace Agreement. We want an agreement that is a great deal for the israelis and a great deal for the palestinians we are not taking a position of any final status issues, including the specific boundaries of the israeli sovereignty in jerusalem or the resolution of contested borders. Those questions are up to the parties involved the United States remains deeply committed to helping facilitate a Peace Agreement that is acceptable to both sides i intend to do everything in my power to help forge such an agreement. Without question, jerusalem is one of the most sensitive issues in those talks the United States would support a twostate solution if agreed to by both sides in the meantime, i call on all parties to maintain the status quo. At jerusalems holy sites including the temple mount known as ha ram al shareef our greatest hope is for peace the yearning in every human soul with todays action i reaffirm my administrations long standing commitment to a future of peace and security for the region there will of course be disagreement and dissent regarding this, but we are confident as we work through the disagreements we will arrive at a peace and a place far greater in understanding and cooperating this sacred city should call forth the best in humanity lifting our sights to what is possible, not pulling us back and down to the old fights that have become so totally predictable. Peace is never beyond the grasp of those willing to reach it so today we call for calm, for moderation, and for the voices of tolerance to prevail over the purveyors of hate. Our children should inherit our love, not our conflicts. I repeat the message i delivered at the historic and extraordinary summit in saudi arabia earlier this year, the middle east is a region rich with culture, spirit, and history. Its people are brilliant, proud, and diverse. Vibrant and strong but the incredible future awa awaiting this region is held at bay by bloodshed, ignorance and terror Vice President pence will travel to the region in the coming days to reaffirm our commitment to work with partners throughout the middle east to defeat radicalism that threatens the hopes and dreams of future generations. It is time for the many who desire, peace to expel the extremists from their mists. It is time for all civilized nations and people to respond to disagreement with reasoned debate, not violence it is time for young and moderate voices all across the middle east to claim for themselves a bright and beautiful future so today let us rededicate ourselves to a path of Mutual Understanding and respect. Let us rethink old assumptions and open our hearts and minds to possible and possibilities i ask the leaders of the region, political and religious, israeli and palestinian, jewish and christian and muslim to join us in the noble quest for lasting peace. Thank you. God bless you. God bless israel and the palestinians and god bless the United States. Thank you very much. Thank you. So President Trump making it official the u. S. Officially recognizing jerusalem as the capital of israel and move from tel aviv to jerusalem and he insists that will pp the Peace Process. Not everyone agrees. This is a lot of debate. There has been no peace in israel either. He said that multiple president s along the way either have pledged to do exactly what he is doing today by signing the document that he is displaying there which i suspect is the that acknowledges jerusalem is the eternal capital of israel and those prior president s despite a law from the 1990s that indicated our intention to declare jerusalem and president s have not delivered he said today i am delivering. It is the right thing to do and it has to be done. So says the president. Delivering on a Campaign Promise as well. The endowment for mideast troops in tel aviv, what do you think of what President Trump did today. This is a deeply unwise decision that under cuts every american president from truman through President Trump. All of them understood that the United States is the most likely mediator that we cant get ahead of the israelis and palestinians and every president thought that was a wise judicious course of action President Trump is taking sides and the significant decision is not the embassy. The decision is whether to declare that we legally believe that jerusalem is the capital of israel that gets ready and puts the u. S. On one side visit the other. It will diminish credibility with the 1. 6 billion muslims in the world. Number two, the state department is warning about potential trouble with american embassies and insightments and no one wants to see that. This step may inflame those passions and finally i say this. There are no negotiations under way right now. The government of israel did not ask the president to do this the president offered this major american concession of 70 years that no one else is willing to make and appears to have gotten nothing in return. As a diplomat and former negotiator but. Can i say that as a negotiator in the middle east, we have to worry about americas interest if you offer a major concession and get nothing in return, i think you have harmed the United States fair enough, but i want to make sure the viewers understand the history of the bill. The reason the president is signing it is this bill was already passed in 1995 the Jerusalem Embassy act passed 935 in the senate. In 1993, 257 numbers of the house of representatives sent then secretary of stalt Warren Christopher saying please move the embassy to jerusalem we are putting it on trump because he is taking the executive action, but the congress authorized this 24 years ago. Why are you against it now this has been around for over two decades. I was against it then and i was spokesman working for them and im against it now most of the people who worked on the issue, that bill gave the president a Waiver Authority as many bills do its interesting that president clinton, president bush, president obama, all exercised the waiver this is not in the American Interest it is the president putting his interest at home over the issues of our nation. Lets get sarah stern in here this is long overdue. Zionism is the National Movement of the jewish people and after 2,000 years, we have come home to our ancient homeland to be free and active participants in our history. Yet we are the one people who cannot decide where to place our own capital and have it respected in the world this is a historic day we have diplomatic relations with 190 countries they have all selected where they want to place their capital city except for israel this is not a concession with all due respect. This has been an act of love i have been around for a long time and for every single time somebody runs for office, they vow that as soon as they are elected they will move the embassy from tel aviv to jerusalem and we cannot always allow the threat of violence to be used as a negotiating tool by the arabs. That is pandering to them. It reinforces the use of violence the ambassador said this will hurt the Peace Process not at all. This is reality therapy. What really hurts the Peace Process is the text books that have been in place forever that does not even mention that israel is there. Even the pre1967 borders this is reality therapy because this is something that israel will insist on all along if the Peace Process will break down, it will be about this all along. If i might just followup with your be giling phrase, get reality therapy, how will that reality therapy translate into progress on peace in the shortterm most notably and over the longterm. How do you turn third base and bring it to home plate the thinking is that the Peace Process has broken down because the last time that Prime Minister netanyahu and abbas met, Prime Minister netanyahu wanted him to recognize israel has a jewish state if they cant even recognize israel as a jewish state and recognize that israel can put their capital wherever they want to place it, then there is really not much of a Peace Process. They have got to recognize that israel is a sovereign independent nation and they want to live with defensible borders and they have the ability to place their own capital where they choose. Let me ask a followup question the president referenced the twostate solution and would like to get your thoughts and ambassador burns as well here. I will start with you, if i might, sarah if there is eventually a twostate solution, would you have an objection to the palestinians claiming East Jerusalem or the old city as their capital . Not at all. Not at all i think that every single israeli interlock tor wanted a twostate solution for many years and they want it with defensible borders and they want it to not just be a launching pad for further violence if somebody does emerge that wants a twostate solution and does not use that as a launching pad to attack israel, i hope that god willing, that can exist. Let me finish with the ambassador and can the same question you think this does not make a twostate solution any more likely and makes it less so. If that is the thing that unties the gourdian knot, can you see a time where palestine and the palestinians can claim jerusalem and israel can claim jerusalem as capitals . Most people want to see two states emerge and believe its the only solution. The palestinians would have their own state in the west bank and the gasa strip and the capital and israelis would have their state and a capital in west jerusalem the president s and republican and democrat agreed on that. Thats what we have to drive towards. The issue of jerusalem is of four orrive five status issues that will only be resolved in an epic negotiation im just saying we want to be careful that the United States interest are put forth and we are a great friend of israel and we dont agree on the existence of the settlements in the best bank we dont agree with those on the far right of the spectrum who do not want a twostate solution and dont want to compromise with the palestinians. I think we have to do whats in the best interest of the United States i dont believe President Trump did that today ambassador burns and sarah stern on this important day. Another developing story in washington, d. C. We are watching closely with a growing course of Democratic Senators calling for al franken to resign following allegations of Sexual Misconduct following that story in washington we learned that senator franken will make an announcement tomorrow according to his office. This follows more than a dozen colleagues calling for his resignation and susan colins and tom perez, the chair national committee. It followed a politico report that franken tried to forcibly kiss an aide after a radio show in 2006 before he ran for office in a statement he called the accusations categorically not true new york senator Kirstin Gillibrand had declined to do so last night and said in an event today that the new reporting was the last straw obviously there were new allegations today. Enough is enough this is a conversation we have been having for a long time. Its a conversation that this country needs to have. When we start having to talk about the differences between Sexual Assault and Sexual Harassment and unwanted groping, you are having the wrong conversation you need to draw a line in the sand and say none of this is okay or acceptable this step change comes less than a month after the first allegations against franken of kissing and groping. Those are currently the subject of an Ethics Committee investigation. It comes a day after michigan congressman john conyers resigned next tuesday is the special election in alabama where the Republican National committee put the endorsement behind roy moore. Democrats are trying to regain moral authority on this issue and potentially we could see a resignation from franken tomorrow i wondered if they were making him the sacrificial lamb because of this situation with roy moore so later if indeed roy moore wins, they will say they are the morally better party yeah. It would seem that way got it. Thank you so much. Straight ahead, we are sitting down with ceo Gary Goldberg in an exclusive to talk taxes and the economy and where gold is headed in 2018 bit coin and more. Dont move power lunch is back in two minutes. Finally. Hey ron theyre finally taking down that schwab billboard. Oh, not so fast, carl. Oh no. Schwab, again . Index investing for that low . 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In clinical trials, prevagen has been shown to improve shortterm memory. Prevagen. The name to remember. Hello, everyone im sue herera in brussels, sec tear of state Rex Tillerson said the u. S. Is convinced the incidents harming the health of u. S. Embassy workers in cuba were targeted attacks. He is pushing back on complaints that the u. S. Has not shared enough info to let them investigate the attacks. Were convinced these were targeted attacks we have shared some information with the cubans and their two restrictions i placed on sharing the information. With the privacy of individuals and their medical conditions and the second is not to provide whoever was orchestrating these attacks with information that is useful to how effective they were russian president putin said the decision by the International Olympic committee to ban the russian team from competing in the winter games was political motivate and it would be up to every athlete as to whether they participate as neutral competitors. Going live at midnight through december 17th. They are available on microsoft. Com and stores todays deal is worth more than 300 off the surface pro as the competition between that and amazon heats up. Ty, back to you. Have you bought my present for christmas . I was going to do one of the suth bees options boit coin. It will go with anything. Cold speaking of coin is up almost 10 it has been a wild ride for gold straight ahead, we will talk about the mining ceo about the fluctuations in gold stay with us i mean wish i had time to take care of my portfolio, but. Well, what are you doing tomorrow 10am . Staff meeting. Noon . Eating. 3 45 . Uh, compliance training. 6 30 . Sams baseball practice. 8 30 . Tai chi. Yeah, so sounds relaxing. Alright, 9 53 . I usually make their lunches then, and i have a little vegan so wow, you are busy. Wouldnt it be great if you had investments that worked as hard as you do . Yeah. Introducing essential portfolios. The automated investing solution that lets you focus on your life. Looking from a fresh perspective can make all the difference. It can provide what we call an unlock a realization that often reveals a better path forward. At wells fargo, its our expertise in finding this kind of insight that has lead us to become one of the largest investment and Wealth Management firms in the country. Discover how we can help find your unlock. Some say bit coin is the new gold what is gold is the new gold shares of mining is up this year as well. Joining us now for a power lunch exclusive is Gary Goldberg from the Largest Gold Mining Company in the world. Its a pleasure to have you on thank you very much for joining us thanks for having me. What do you think of bit coin does it enter the board conversations at Newmont Mining as some people say bit coin is the new gold we watch it, but from our standpoint, the technology might have the best applications within our business. Bit coin when i look at it, its a potential competitor, but we will keep an eye on it it is in the early days compared to the 7,000 or so years gold has been out there do you view it as in any form a competitor for gold . We love gold for jewel skpree industrial uses. Some people view it as a currency they want to have it and it makes them feel comfortable. No doubt a few people are dipping into the bit coin world. Is it in any way a competitor to gold as a value play at this stage we havent seen any defense of gold demand side of things. Frankly when it comes to what i will be buying my wife for christmas, it wont be bit coin earrings we have been discussing what kind of graphic we should build. They are not actually bit coins. We talk so much about fracking and there has been all this new technology when it comes to oil that makes previously Difficult Oil now easier to get. Reserves have gone up. We have seen this in a number of commodities. Is it happening in gold . Are there new ways to extract gold to get more of it out of the ground i think the big shift in technology for gold happened like 40 or 50 years ago when we came up with new technologies to extract gold from very, very trace aims in the ore body we use technology in every bit of the business. Automated motors to move material from point a to point b. Operated remotely. You have an individual operating maybe two or three pieces of equipment at the same time we use technology in how we track temperatures and tires to maximize pay loads there is technology in every bit of the operation and how we design and find mines. In terms of being able to use things like fracking and horozontal drilling, we drill two to three to find where they are and how we model and best to understand whats out there where we see the best application. Particularly in the gold space around the world, where is the greatest demand for gold and what do the buyers want to use it for what we have seen over the last couple of years is china coming up and moving neck and neck with india. Those are the largest consuming countries of gold. In both of those, jewelry is the number one use and the store of wealth would be the number two use. What is consistent with the gold space is we see the populations especially the middle class and the countries are growing over the next five to 10 years which is good for gold demand. That are would boost demand and presumably boost the price, right . Exactly what you havent seen in gold is a lot of investment and expiration and in new projects over the last five or six years as you have seen the price come off. We expect to see the mines production of gold drop from 103 million ounces down to 93 million ounces over the last five or six years. Reduction in supply and increase in demand is good. When it comes to gold, a lot of the easy copper in the world has been found do you have to go to more difficult deeper mines than before as the easy stuff that has already been gotten . One of the advantages, we are in four geographic regions australia, south america, north america and africa we go where we find good countries to work in and use technology we are able to take samples at the surface and analyze the water and soil content and detect potential deposits at a depth of 700 to 1,000 meters with no surface exposure its the use of technology to find the deposits. We are finding good success with ethiopia and French Guiana and chile and australia where we are actively doing what we call green field exploration. Got it. Thanks so much for joining us. Appreciate it. Great to be here. Thank you. Straight ahead, howard marks on the markets the fed and the effective tax reform power lunch is back in two minutes. Wow record time. 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Another day, another record bit coins wild ride breaking past 12,000 for the First Time Ever already eying 13,000 it gained over 1,000 in just 24 hours. Bit coin now up a whopping 1200 this year and another staggering statistic. It has a market value of 213 billion, more than twice Goldman Sachss market cap speculative bubble or investment of a lifetime. Everyone has an opinion on bit coin right now the former fed chief weighed in on the soaring price this morning. Whats holding the prices up is supply is down. Human beings buy all sorts of things that arent worth anything, but they do it anyway. People gamble in casinos when the odds are against them. That has never stopped anybody i also asked him when i was filling in on squawk on the street, did he think the creation of bit coin and rise has anything to do with Monetary Policy in the world . A lot of critics say its a direct result. He doesnt think so. Interesting stuff you ready for bit coin in the world . Are you getting your wife bit coin earrings . I have to get my head around it like coin not there yet maybe wilford understands it. Ask me. Im right here record breaking stock rally and where it goes from here. Wilford frost is rally goes from here wilfried frost is here im want sure how i understand it and hes cochairman of Oak Tree Capital and we began by asking him whether he felt investors at the moment should have less exposure to risk assets than any time over the last decade look, the easy moneys been made the s p has quadrupled off the bottom and most assets are selling at the highest prices and highest valuation metrics and the lowest prospect of returns theyve ever had so it makes sense to me that one would want less risk today than three years ago or six years ago or nine years ago in terms of tax reform, you mentioned in an interview with Andrew Sorkin in october that you didnt think the Market Expectations for tax reform would be surpassed whats your view at the moment in terms of what is priced in. I think they may be surpassed. I thought the request for a 20 tax rate was something you could get from, and that they would compromise somewhere between that and 25 and the 20 tax rate for corporations is very low and corporations which are paying a lot of Domestic Taxes will see a real boon. And in terms of what that means for the market, is it just a boost for earnings or does it trickle down throughout the economy, as well the trickledown is a treacherous term i think it doesnt trickle down too much i think that some corporations and their owners do better i saw on tv the other day somebody who said it would be shared with the workers and the customers, not in my expectation, companies are not going to pay their workers more than they have to just because they got a tax break so, look, our economy is doing rather well. We are at an unusually low unemployment rate. How much growth is possible . Now many more people can they employ most companies have trouble finding employees they need not that they need encouragement to hire more. Lets talk about bitcoin. Originally, you were fairly critical of bitcoin and youve changed your tune most recently. Most recently in saying that you do believe it can legitimately be framed as a currency even if it doesnt have outright government backing is that fair or are you more positive than you were on it im more positive on it as a thing because i think it has use in store value, currency, et cetera im not optimistic on it as a way to make money because why should the fact that it can serve as a currency or store a value mean that it should appreciate in the future i dont see the connection there. And in terms of the price at the moment, the mid12,000s, do you think its in the marketplace where the bitcoin, where they can buy 12,500 worth of products . Thats really a question. Not too many people take bitcoin. Number two, i dont know how you use it in small denominations. Maybe thats just something i dont know, but the point is increasingly, people are willing to accept it as a currency, but what does that mean . That means for the most part that you go out and buy a bitcoin, you give it to me and i turn it back into dollars right away most people are not going to actually conduct their businesses in bitcoin. In terms of one of the claims of bitcoin fans is that it cant be hacked and that the block chain is this unhackable technology whats your view on that because is that something that you think can last forever or in due course it will be another thing we have to assess the sort of security of . Well, i think that, number one, a lot of the claims that are made for bitcoin are around cant be hacked and cant be stolen and cant be deflated away. The government cant issue twice as much again. These are claims that remains to be seen whether theyre true im not enough of a technologist to know. The other thing is when i ask people whats good about bitcoin, often they respond about whats good about block chain and they conflate the two, and the two are different. Block chain is a process and bitcoin is an app, and the fact that it is a good thing, and you will see block chain, it doesnt mean that bitcoin which is now 12,000 is going to be worth 24,000 i just dont see that connection in terms of where people should place their money, just listening to your presentation, one of my takeaways was that you feel traditional sort of hedge funds may have had their day, but the private equity looks attractive in this current environment going forward. What i really said is that people who want to make a substantial rate of return in this low return world have to put some of their money into alternatives i believe that the for the most part the hedge Fund Movement has been, shall we say, defrocked and what that means is more demand for other alternatives of which private equity is really the headline one. So what i was saying wasnt that they would get high returns, but that i think the private Equity Industry will see a lot of capital inflows and they are howard, pleasure speaking to you. Thank you very much for your time my pleasure thank you. Howard marks there, the cochairman of Oaktree Capital from the Goldman Sachs financial conference guys all right willfred frost, appreciate it. Shark tanks kevin oleary, mr. Wonderful. So much winning and hes here on the markets, tax reform buybacks and no doubt to brag on the power lunch stock staff, were going to abuse him stick around welcome back. Heres whats on your power menu as we get closer to a signed tax cut bill will it be a case of buy the rumors sell the news mr. Wonderful kevin oleary will weigh in plus, is casual dining dead in the ceo of p. F. Changs is here on how to win on one of the toughe toughest games in town te build it up or tear it down . Robert shuler weighs in and more democrats are calling for senator al franken to resign following Sexual Misconduct allegations. We will have the very latest from d. C. For you. Im Brian Sullivan and the second half of power lunch begins right now all right. Back from the halftime break lets check the markets right now. Major indexes marginally lower, no, marginally higher. No, marginally lower at this hour energy and telecom are lagging while Technology Leads to the extent right now microsoft, visa and boeing are leading the dow. There you see them up more than a percent for microsoft and visa, a little less than that for boeing laggards, merck, home depot, disney, home depot lower despite announcing a 15 buyback program. Alltime highs today, mcdonalds, brown foreman, clorox and cisco and davita leading the s p and the Company Announcing it would sell its clinics for 5 million United Health is moving and theyre moving into health care and delivery and a whole bunch of ancillary things. Emerging markets the etf, that etf otherwise known as eem, eem on pace for its fifth down day in six. President trump officially recognizing jerusalem as the capital of the nation of israel in just the past hour. Eamon javers is live at the white house with more. Caller t the president acknowledging the reality on the ground in jerusalem and saying its time for the American Government to make a break with the policies of the break heres what he said. The record is in. After more than two decades of waivers we are no closer to a lasting Peace Agreement between israel and the palestinians. It would be folly to assume that repeating the exact same formula would now produce a different or better result. The president acknowledged that his decision today could result in dissent and protest across the middle east, but said ultimately his goal and the u. S. Goal here is for peace in the region today we call for calm, for moderation and for the voices of tolerance to prevail over the purveyors of hate. Our children should inherit ou love, not our conflicts. Importantly, michelle one of the keys here is that the United States is going to move its embassy from tel aviv to jerusalem, but not immediately that process, white house Officials Say could take some years. Its entirely possible, in fact that there could be a new administration in place before the embassy is finally built and ready to be occupied in jerusalem. This is a longterm process and the big step here was acknowledging that jerusalem is the capital of israel. That is a step that other american president s have simply declined to take well see whether that changes the politics in the middle east. Right now the administration is hoping that this will clear the way for peace. Back over to you eamon, we heard negative comments out of saudi arabia, out of jordan and out of egypt i spoke with one Foreign Policy adviser that says those countries will say those things out loud to please those people and their base, but behind closed doors they dont think it will be important to them. We dont know what kind of back channel theyve said and what the saudis have said and theyre embroiled in their own power plays over there, as well. The Administration May be getting some signals and we dont know publicly what those signals are and that could give you a sense of what the mood is among the republicans. That was my question. You never really know, you may not know what the governments are going to say soto voce, but the arab street may react very quickly. There are predictions that this could set off another intifada, and not to say if those are overblown. Time will tell the white house feels even though there is a potential for disruption the president calling for calm and feeling this is simply an acknowledgement in the reality of jerusalem, and they went out of their way to talk to reporters being briefed on this in advance to suggest that theyre not proposing any change here to the religious sites in jerusalem. They want the status quo on that this is simply a diplomatic change in recognition of where the capital of jerusalem is. Thanks, eamon the other big story of the day, developing in d. C. , more than 20 Democratic Senators calling on minnesota senator al franken to resign. This follows allegations of Sexual Misconduct. Senator gillibrand of new york weighed in obviously, there were new allegations today and enough is enough i mean, this is a conversation weve been having for a very long time. It is a conversation that the country needs to have, and i think when we start having to talk about the differences between Sexual Assault and Sexual Harassment and unwanted groping you are having the wrong conversation you need to draw a line in the sand and say none of it is okay. None of it is acceptable. Franken is expected to make an announcement tomorrow lets bring in john harwood who is here at cnbc hq good to see you on set this is a story thats developed a lot in the last 24 hours it is stunning how quickly the ground has eroded under al franken on this story, and when you think back to the societal changes that have been set in motion by the original disclosures about harvey weinstein, i think what happened was initially democrats assumed that al franken would be able to weather the storm and al franken assumed that, but the need on the part of democrats to enunciate their position clearly and to draw contrasts between their party and the republican party, to draw a contrast between how they treat their elected officials and how republicans treat donald trump or roy moore has caused them to coalesce behind the idea of pushing him out. They cant make him leave. This is not a former expulsion effort although its possible that that could follow, but its going to be very difficult for al franken to resist the complete alienation of his colleagues do you believe, john, that roy moore will win in alabama . I think it is a very close race i think it is essentially a tossup race at this point roy moore could win, but doug jones i bring it up for a reason. If roy moore does win, is there a part of this story which is the democrats will now be able to say look at how we treat our senators who do these things, and look at how the republicans treat their senators who allegedly have done these things yes, but in fairness to republicans, they in the initial instant when the allegations came out against him, after an initial period of stalling they did call for they wanted him to pull out he wouldnt do it again, if al franken decides to roy moore the situation he can say sorry, guys, im not going anywhere he was elected by the people of minnesota. They can throw him out unless the senate decides to as a group and thats a very high bar to throw him out, but lets say franken resigns and hes got an announcement tomorrow and throw your implication from that, whatever is there a democratic governor in minnesota that person would appoint a democrat who would face a special election in november. I dont know what the rules are in minnesota each state has different rules over how quickly you have to have you serve out frankens term, and the question is how quickly would that be triggered in any case, mark dayton is the democrat in the Governors Office and democrats wont lose a seat and in that way it is costfree for democrats to call for his resignation because they know theyre not going to lose a number john, thank you the market has seen big jumps as tax reform moves through congress how are investors trieding on news of the tax bill Steve Liesman takes a look at the sectors that are gaining the most high taxes are hot, tyler hightech stocks are hot right now on wall street after they originally downplayed the tax cut and the market has woken up to whats happening or possibly happening in washington in just the past month heres the tale of the tape. The market ignored High Tax Companies paying 25 or higher in taxes compared to lowtax stocks paying less than 25 . Here are the s p returns and you can see there, and the s p was up 14 and the low tech stocks are up 24 and high tech stocks down 4. 8 . I mentioned this from the time we pointed it out which was october 26th and the chance of a tax cut has increased and you can see the market, the high tech stocks outperforming, almost double, the returns of the lowtech stocks in the past month and if you annualize that it looks pretty good there so should you sell or buy on the news michael thompson, president and chairman of Standard Poors Investment Advisory services who helped us put this data together says you might see profit taking however with certain caveats this is a positive piece of legislation for most large cap ps upon he thinks it will stick around for a while not all hightech stocks are treated the same here are the leaders by sector including real estate. Real estate up 9. 1 and Consumer Staples up 7 and Consumer Discretionary nearly seven, as well and financials and energy were two other sectors in the past month when you dig down into it, companies with higher taxes even within the same sector, guys are doing better than companies with lower taxes in the same sector the Consumer Discretionary or the energies and you can see the markets and the earnings will benefit from a tax cut got it. Thank you. Thank you very much. Differentiation as investors put the knowhow from the tax bill to work here to talk more about the tax reform bill and what effect it could have on the markets kevin oleary. Hi, kevin. Good to be with you. How is the unlikely tax cut for corporations in the United States steve touched on it the most interesting place to be right now, if you believe were going to get a 20 to 22 Corporate Tax rate is in companies that pay that kind of tax and the highest tax bracket, as you mentioned they tend to be found in the russell 2000 theyre Domestic Companies with 100 of the revenue in the u. S. And i have not been a big investor in the russell 2000 for over a decade because there are 2,000 companies there and the majority of them dont make any money and you have to do a lot of work to find the ones that are actually candidates and they have to be profitable and generally, the 4 billion market cap and theyll have an extraordinary upside because lets assume a 22 tax rate. That means the Free Cash Flow in 2018 assuming this is grandfathered to january 1, 2018, will increase between 15 and 20 . You cant find that in an s p company because 47 of their revenues are already offshore in lower tax restrictions and the lowest tax average is 25 . So the average s p company is not the beneficiary. Im going smalltown america here and i think its going to really work i built an index with footsie russell called ousm and thats what i own and you can buy the russell 2002 if you dont mind owning the ones that dont make any money. This tax bill say once in a lifetime opportunity to find Domestic Companies that are going to increase their cash flows by up to 20 thank you, mr. President thank you. How worried are you about the potential imposition of the minimum tax on companies would that change your view . Yes it hurts, and im hoping that wont show up. There are two parts of the plan that im really worried about right now and thats because many of these companies, these Smallcap Companies and certainly my private portfolio with over 40 Small Companies in almost every state in america, thats a result of ten years of shark tank is the estate tax if you look at the house plan versus the senate plan, there are major differences there because one says lets phase it out to zero in six years and the other says no, lets just reduce it the problem weve got in america is if we get a business that we say is worth 50 million after toiling your whole life you have to give it back to the government when you die. So all of those people are contorting themselves, setting up trusts, selling it early and breaking farms in half and we dont talk about it very much. I live it every day and i want to see the death tax gone and the amt will really be a negative in terms of the Smallcap Companies for corporate amt if its there. Im like you, im watching and waiting. Every time i can get a clue out of these politicians i ask them and i even emailed in to becky to get a question in to that senator, and he would arent answer me. Shocked a state tax yes or no. He wouldnt answer the questions because he doesnt know so this is a very interesting situation. You never won in the stock draft because you picked boeing up 51 year to date, apple, 18 . Its boeing thats helped you out here are you sticking with that yes, i am mr. Wonderful, number one, up 34 year to date there is a reason they call me mr. Wonderful now you know i want to tell you something about this contest. Dont whine about the dividend thing. Im whining about that oh, come on i wanted to make a point to investors. You dont have to buy tech stocks that are crazy multiples that dont pay you dividends to win a contest like this, to beat the market. Right apple pays a dividend boeing pays a dividend and theyre not trading at crazy pes when i teach young engineers, im doing a lot of this, i take these examples and say dont get sucked into this hightech stuff where you have crazy multiples trading at 50, 80, 90 times and you can get Companies Like these and beat everybody theres living proof thank you. They dont include the dividends. Kevin, i have to ask you, how do you decide which color tie to wear every day i have 25 of these suits, 25 ties and 25 white shirts and 25 little pins. This is my uniform i dont have to think about it anymore. Thats right and my wife, she says, listen, why dont you try Something Else for a change . Why not go black black tie. Why waistband width on these smart decisions. Cnbc will be in austin for the final stop of the year on the iconic tour and guess whos going to be there . Kevin oleary doing a Facebook Live ask me anything on the Cnbc Facebook page. To submit a question ahead of time, i guess hell be on the Facebook Live from iconic entrepreneurs Facebook Group just search iconic entrepreneurs. He knew the rules going into the apple and every time he comes on he complains about the dividend and hes still winning. How much winning does he need . The fact that the dividend is not included. The battle over housing, Robert Shuler will join us the republican tax plan has been sharply criticized by homebuilders and realtors. Many of them say the plan would discourage home buying and push down prices in some states whats the reality diana olick joins us with an expert, robert schuller, Yale University and cocreator of the caseshiller index who better to talk about home prices and professor, thank you very much for joining us lets get right to the tax plan. It has been claimed that if this republican tax plan goes through, cutting the deduction cap in half and cutting property Tax Deductions that home prices can fall as much as 10 or even more in states like new york, new jersey and california. What do you think of that claim . It could happen on the other hand, if i think like an o efficient market theory, which im not, but let me put that in, we already knew the general parameters a could month ago and we heard about these things in the elections so its not news. It will be a little bit news now the other thing is the magnitude of the effect or people have studied that if people are rational and calculating the standard deduction and various things that could affect, but the general idea is that it would push prices down if people are rational. But youre saying if people are rational the question is do we use the mortgage Interest Deduction as a major incentive to buy a home . No. Most people dont itemize, and so its not big. The other thing is the the deductability of property taxes on the state and local basis, that is going to be substantial a substantial hit to people who are paying a lot of property taxes, and it might be a consideration that you make before you buy this big mansion in highproperty tax state so it does have the effect, but i tend to think its not as great as you imagine because people are people and i find that historically, and the Interest Rates and when Interest Rates were high in the early 80s the home prices are low, but they were extremely high and double digit. Interest rates could begin to rise next year as were talking about this with the fed and you actually said that you spoke at the Realtors Association this morning. You said that was most concerning to you. Do you believe that Interest Rates will rise next year and create a bigger issue than the tax plan we have the dot plots that the fed puts out and theyre expecting short rates to rise and historically, i did my ph. D dissertation on this thats why were talking to you about this that makes long rates rise. Look at the real estate booms. Longterm rates werent doing anything that dramatic that would justify this big up and down i just dont think that the its a general worry that rising Interest Rates will deflate the Housing Market and the stock market, it doesnt work that consistently youre saying whether we have a mortgage Interest Deduction of any sizeable amount or not, or whether we have rising Interest Rates none of that determines Home Ownership its not that i agree with the recent studies that it is a downward pressure on the stock market, but things happen that have no explanation. For example, the steady rise in home prices, very steady ever since 2012 and when is that going to stop . In the trump boom, it didnt happen all at once, donald trump on election night, im trying to remember what the numbers did, and it wasnt as big as what happened gradually the efficient markets theory say Donald Trumps effect happened immediately when he was elected. It isnt like that its like people are changing their mind and its what i call narrative economics. Okay. Thank you so much, professor shiller for joining us, back to you guys brian is not convinced. Thanks diana. Wildfires are burning across Southern California, destroying homes and forcing thousands to flee were live tbel r. O ai the pictures are unbelievable. Straight ahead 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. Thats it. Im calling kohler about their walkin bath. Nah. Not gonna happen. My name is ken. How may i help you . Hi, im calling about kohlers walkin bath. Excellent happy to help. Huh . Hold one moment please. [ finger snaps ] hmm. The kohler walkin bath features an extrawide opening and a low stepin at three inches, which is 25 to 60 lower than some leading competitors. The bath fills and drains quickly, while the heated seat soothes your back, neck and shoulders. Kohler is an expert in bathing, so you can count on a deep soaking experience. Are you seeing this . The kohler walkin bath comes with fully adjustable hydrotherapy jets and our exclusive bubblemassage. Everything is installed in as little as a day by a kohlercertified installer. And its made by kohler americas leading plumbing brand. We need this bath. Yes. Yes you do. A kohler walkin bath provides independence with peace of mind. Call to save 500 off bath walls with your walkin bath, or visit kohlerwalkinbath. Com for more info. Scenes across Southern California massive wildfires raging across los angeles and Los Angeles County destroying hundreds of homes, forcing hundreds of residents to flee and authorities have warned the biggest fire was still, quote, out of control jane wells is live in bel air with a lot more and jane, we saw some video this morning of the 405 near the getty museum. I grew up in los angeles im not sure ive ever seen anything like that yeah. It is pretty incredible. Most of the fires have 0 containment and we are on top of mulholland to show you how smoky the nations second largest city is you are looking at the back side of the bel air fire and there are helicopters and fixedwing aircraft getting water and the helicopters are getting water from the reservoir near us to take, and if we take you to the live chopper shot. This is one of the most exclusive neighborhoods in los angeles come is under e evacuation orders. At least four mangs have been, and Rupert Murdochs property has been evacuated and no injuries there and no injuries that we know of this fire and it closed down one of the most crowded freeways in america, if you look at what we have, cell phone video taken this morning as hundreds of cars ended up trapped on the 405 freeway in the sepulveda pass the northbound lanes were shut down, and so were the southbound, and very skaury. We have five active fires still burning, four out of the five have 0 containment. Over 77,000 acres burned over 180 and that number is going up and structures destroyed and we expect that number to go way up. Thousands, thousands of people being evacuated and we really, right now, the good news is that we have low winds. If you come back and look at me live you can see my hair is not blowing around firefighters are taking advantage of that because starting tonight the santa anas are about to kick into high gear again and last through the weekend and i want to show you this is the city of l. A. And bel air. Do a 180 this is the san fernando valley. This is where theres another large fire off to the right is the creek fire 11,000 acres destroyed, 1300 people evacuated there and as you pan left you can just see smoke is blanketing the san fernando valley. Its meeting up with smoke from the fire over the hill in Santa Clarita and going out to where i live in Ventura County, where they have the largest fire, the thomas fire which is also just burning its way down to the ocean. It is amazing. Schools are closed air quality is terrible and firefighters are telling everyone in Southern California be prepared to be ready, set, go just in case because this is an unusually long sustain santa ana week thats lasting in december. In december, thats nusual and by now were supposed to have rain not a drop. Are you having any trouble breathing, jane . I have to tell you, it was so hard getting up here because of the traffic, everything shut off. I started hiking up if you know this city, people i parked on ventura boulevard and started hiking up coldwater. A tow truck driver finally pulled over and said dont be an idiot. Get in, between my media i. D. And him being a tow truck we were able to get past everything, but yeah, ive been very congested and it is hard to breathe. You definitely, definitely feel it jane, we were out there a couple of years ago. As you remember, we talked about the drought and luckily we had a lot of snow packed earlier this year and mammoth may still have snow and the reservoirs got refilled, but one of the fears about the drought was not just you cant water your lawn, its that there warrant going to be enough water for firefighters to use in the case of any devastating fires. We obviously have sonoma way up north, i get that. Last month or a month ago when i was out there there was a fire out by the diamond bartype area any talk about the level of water and whether theres enough for the firefighters to use . Well, the water pressure has been an issue. There were some reports of the Ventura County and the massive thomas fire that they were having trouble getting water out of the hydrants. Theres plenty of water in the reservoirs right now even though we havent had rain in a while, it was a good, wet spring. One of the other things that is going on now in certain areas particularly out in Ventura County with the thomas fire, people are being told theyll have to boil water for at least a minute because it may not be safe people without power, traffic is a mess i mean, the 405 i cant emphasize enough, the 405 between the 10 and the 101 is a major, major artery, and when that went down the morning commute just forget about it. Forget about it . The pictures tell the story, jane thank you so much. Stay safe, please you bet go from that to its been a good year for Hilton Worldwide that stock is up 38 so far this year and in an effort to stay ahead of the crowd and air bnb the company is looking to go high tech. Seema modi is with the ceo of hilton seema, take it away. Michelle, thank you so much we are at the newly launched innovation gallery that serves as an incubator for hilton to test how now products and joining us is chris aceda, thank you for joining us today what is the multimillion dollar project . Heres the thing, in the dna of this company is innovation. If you think of hilton as almost a 100yearold company or 99 years old, we invented a lot of what you think of in the Hotel Business today that you take for granted. Somebody had to invent the first Airport Hotel and the First Full Service hotel and the first reservation system for that matter, someone had to invent the brownie or pina colada i am proud to say that our company did all of those things and so innovations built into the dna of the company what innovation is about for us is about technology, but its really holistic innovation and its the blend of innovating with products and innovating with service and innovating with technology and connecting the product and the service with technology so hilton is becoming more tech savvy what does that mean for consumers . Are prices going up . I dont think it is up to consumers at all and we have to be efficient and with Computing Power and cloudbased opportunities, and want at all in fact, everything that were doing in the area of technology is getting cheaper, not more expensive and so all of the things that youre seeing today with the digital key and digital checkin and room selection, we can do and be much more efficient than weve ever been in the past. Okay. I want to switch over to taxes because we are right outside d. C. , chris and tax reform is front and center. Im shocked youre asking about that. I need to know, how is this going to change the way you allocate capital its not really going to change the way we allocate capital. The pruth of the matter is im optimistic that tax reform will get done and the next week will tell and theres a tremendous amount of momentum and weve been actively engaged in the dialogue i think its good for the economy and i think it will be good for our business and it will be good for our industry in the sense that Goldman Sachs economist thinks it will add 30 or 40 basis points to the gdp next year which will ultimately translate for growth and demand for hotel rooms. From our point of view particularly in a postspin world and the spin of the time share business, we are a very capital light business and we have owners all over the world building these hotels for us and its not our capital and tax reform reducing the tax rates will drive more Free Cash Flow and the largest part of that cash flow increase will go to shareholders well have to leave the conversation there its a heavy news day. Thank for having us here power lunch team, back to you. Seema modi down in Tysons Corner thats my back of the woods your country. Casual dining restaurants have been hit hard lately, but p. F. Changs has been red hot and guess what they are planning to expand. We will chat with the ceo of p. F. Changs with his get it . Recife for success and whether or not theyll accept bitcoin. I want to show you that bitcoin crossing 13,000 per coin for the First Time Ever. The winkle boss twins. Thank you very much were back after this i used to have more hair. I used to have more color. And. I used to have cancer. I beat it. I did. Not alone. I used to have no idea what the American Cancer Society did. Research . Yeah. But also free rides to chemo and free lodging near hospitals. I used to maybe give a little. Then i got so much back. I used to have cancer. Please give at cancer. Org. Im sue herera here is your cnbc news update at this hour. President trump breaking with decades of u. S. And internationalpolicy by recognizing jerusalem as israels capital this despite urgent appeals from arab and european leaders who fear it will create more violence in the mideast. Today we finally acknowledge the obvious, that jerusalem is israels capital this is nothing more or less than a recognition of reality. It is also the right thing to do Christian Nielsen was sworn in as the new secretary of homeland security. She is the sixth punish to lead the agency and the first dhs employee to hold the top job she was an aide to john kelly at the white house. The thoroughbred at auction was broken when marcia was sold for 8. 5 million michael magnian bought her after winning a bidding war. Why the high price that mary was thained by Mark Prescott and he has more than 1300 wins to his credit. Thats the news update this hour, ill send it back to you, brian. Marcia, marcia, marcia, cant get no attention sue herera, thank you very much. You got it. Don chu hows it looking . Down near the lowest level of the day. Wti prices there over 2 lower for brent crude this after government Inventory Data show private sector estimates were on spots and there was a bigger than expected drawdown in oil and the distillates signaling weakness in demand and the recounts on friday back over to you. Today there say new bipartisan bill designed to prevent Sexual Harassment in the workplace. It would eliminate forced arbitration clauses which are often imposed on employees for all kinds of issues, not just Sexual Harassment. Gretchen carlson helped champion the legislation. Welcome to power lunch, gretchen great to be with you. First, i want to ask you about the Time Magazine cover story, metoo and the person of the year being the silence breakers a lot of women on the cover and its been noticed quite extensively on social media that you are not mentioned and you are not on the cover does that surprise you since you were the very first person to come forward when you sued roger ailes . Yes, but ive been in a tremendous amount of stories over the last 17 month, and i think people know where all of this started, and im just incredibly proud of all of the other women who have come forward after me one of my favorite quotes is one woman can make a difference, but together we rock the world and thats what were seeing happen right now. Just one more question about this did they talk to you or did they approach you anything nothing . No. Do you think theres anything in that thats related to politics, dare i go there . I have no idea. I think youd have to ask Time Magazine and i am immensely proud of the women that have come forward and thats been my mission as well as what i was doing on capitol hill today which was an incredible accomplishment to get a bipartisan bill. You have no idea how hard ive been working on this, walking the hallways and meeting in private with republicans and democrats and today was the culmination of that and its an amazing accomplishment for women of our country. Should al franken resign . Yes, he should. Hes from my home state of minnesota. He was originally the cosponsor of my bill in the senate and with more allegations as they come forward it looks like it was not just a oneoff situation. What would your bill do, exactly . So arbitration forced on people, 60 million americans have this in their Employment Contracts right now takes away your seventh amendment right so women will have the choice about whether or not they want to go to secret arbitration or if they want to go to an open jury process its a huge, huge accomplishment because somebody like myself would have been forced into a secret chamber and i wouldnt be sitting here talking to you today. Gretchen, its Brian Sullivan good to chat with you again. Hi, brian was it a hard job to get this bill in or did you find a fairly welcoming congress this is pretty much a democratic issue, so i didnt have po pound the pavement very hard to get those representatives and senators to join me, but this tends to be an issue that republicans wouldnt normally be on board with because of big business and chamber of commerce. I did a lot of hard work over the last year and i am proud that Lindsay Graham is the cosponsor on the republican side for the senate and we had walter jones, congressman of north carolina, and also lee stefanik from new york this is an amazing accomplish. Nothing gets done on the hill, as im sure you know, and the idea that we would be able to forward this bill for women is unbelievable it is you know, gretchen, heres the thing about the republican side is that and we talked about this yesterday on this program which is, did you find people, you said hiding behind big business which i can understand because on the surface you say some of these guys made a lot of money for the company and lets protect them, but companies, i hope, are coming to the realization that its going to be far more expensive, not in terms of settlement, but in terms of customer whatever you want to call it. Public relations its a lot more expensive to protect these people than it is the other side do you think that people are finally coming around to that way of thinking and looking at it i certainly hope so, brian. Heres the final Tipping Point in what were seeing right now in the watershed moment of so many women and men coming forward, the final Tipping Point will be men within the confined structures of Workplace Environment to stop being enablers and bystanders and come forward, as well i know its hard to have the courage to do that, but also for businesses to be introspective and say how are we handling these issues within the walls of our structures and are we doing the most to believe the victims when we come forward or do we push them aside and fire them which is exactly what happened to me . What do you think about roy moore and specifically, what do you think of the president and the rncs support of him Sexual Harassment is apolitical when somebody decides to harass you, they dont ask you what party you belong to and weve seen titans from both sides fall which is proof that it is apolitical you cannot pick and choose the women that you want to believe its disingenuous to say that you believe some women and not others unfortunately, in a political realm, we have to wait for the voters to make those decisions in private companies, people can be fired to a parallel question to what tyler asked earlier about al franken, you think al franken should step down and roy moore shouldnt be running for the position correct gretchen, thanks for joining us thank you so much for having me. Gretchen carlson. All right changing gears a lot grab a napkin and fork were serving up some lurnch on power. The ceo of p. F. Changs will join us. Theyre outpacing the competition and in a world where people say there are too many feel that . Thats the beat of global markets, the rhythm of the world. But to us, its the pace of tomorrow. With ingenuity, technologies, and markets expertise we create the possible. And when you do that, you dont chase the pace of tomorrow. You set it. Nasdaq. Rewrite tomorrow. Theres been a lot of talk about the death of casual dining, but p. F. Changs has been stirring up profits and has plans to explain and how is it succeeding in the challenging sector here for a power lunch exclusive is the ceo of p. F. Changs michael, welcome good to have you with us. Good to be here how is your business doing and how is it changing either in terms of where youre putting new locations, the size of those new locations, what youre doing . Great opening question. Let me start with how the businesses are doing and i think you said in the beginning with the decline of casual dining heres the truth, there are two businesses in casual dining. The dying ones and the not dying ones. Yeah. The formula is actually really simple if youre trying to put as much food on a plate as possible and get three courses for 9. 99, and youre putting food in a fast oven and heating it up, youre dying because america is voting with their dollars and saying thats not what i want the reason were doing well is because we cook food with integrity, right every dish you eat at p. F. Changs is made fresh, and we sweat the ingredients that we put in our food and thats why were doing well what does the box look like and how are we evolving it a couple of interesting themes, if you go to new restaurants youll notice we are embracing a more contemporary look, open kitchen and openair design, et cetera we cook in our kitchens and weve hidden them away so people cant tell. Are you more in maulls or mor standalone locations . Explain that to me and i think of p. F. Changs as pretty large footprint places right i think both questions. Footprint places. Yeah, right i think both questions, first we tend to be historically we have 6500 square foot restaurants which is big so what weve been doing is smaller restaurant, but bigger kitchen believe it or not and the bigger kitchen is because more and more people are choosing to do takeout do Third Party Delivery and eat great food but go at home and do it so were doing that were giving bigger kitchens, the second theme you asked about, mall, not mall, Lifestyle Center so we do have about 40 of our restaurants are in what people call traditional malls 40 are in like Lifestyle Centers, something that feels like a town center, that is more open and 20 are standalone pads but the interesting point it doesnt matter where we are our performance is consistent. People are finding you. Whats your effective tax rate, your not publicly traded and how much is it going down and what will happen were owned by a private equity firm. Our effective tax rate is irrelevant because the interest that we pay and everything we dont have a huge tax burden i dont think the tax plan is going to have much of an impact on us. We are a midcap company at best. And the vast majority of our revenues, we generate a bunch in the u. S. But also get a bunch of revenues from royalties abroad and so the entire tax proposal is going to have de men must impact on us. Can you make healthy food that tastes good we know a lot of people come on, you want to give people what they want. Right. But you want to make sure its not 4,000 calories a dish because there are people that are health conscious. I think the trap people fall into is when they do the kind of testing to find out if people like the food is give you this dish versus this dish and say do you like that dish im passionate about doing right for our guests and so one of the things that were unveil something weve worked over the last 18 months to reduce sodium anywhere from 30 to 50 . Its pretty high on your menus. Ive looked. It tends to be. Not just you. Chinese food in general. If i go to applebees, whatever it is, it is going to be high. Absolutely. Bring it down. Were proactively tackling that one of the things weve done is weve done this serial test, test for three months, test new formula with lower sodium and you know what, lo and behold when you take the salt out you take the sugar out weve gotten better food taste scores because they say i can taste the vegetables and beef. Ginger and other flavors in the dish when you knock off salt, and you knock it out of your diet and have something that has salt in it, whoa. You go crazy whats your favorite dish on the menu next time i go in i want to order what michael order. Do you like spice i love spicy. I think our i know we got to go. I think our kung pao shrink is to die for. Thanks, michael nice to meet you one in manhattan. Theres one right down the theres one right down the road 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. So how old do you want uhh, i was thinking around 70. Alright, and before that . You mean after that . No, im talking before that. Do you have things you want to do before you retire . Oh yeah sure. Ok, like what . But i thought we were supposed to be talking about investing for retirement . Were absolutely doing that. But theres no law you cant make the most of today. What do you want to do . Id really like to run with the bulls. Wow. Yea. Hope youre fast. I am. Get a portfolio that works for you now and as your needs change. Investment Management Services from td ameritrade. Im here to talk to you about how at t gives you more. And so am i. Like how when you buy the amazing new iphone 8 you get another one on us. See we give you more phones and more spokespeople. Are you guys doing a spokesperson thing right now . Yes. Awesome, can i be in it . Well, it kind of like a twophone deal. So two spokespeople. Got it. K. Thanks. At t its time for more. Its time for more. Buy the amazing iphone 8 at at t and get a second one to gift, on us. Looking from a fresh perspective can make all the difference. It can provide what we call an unlock a realization that often reveals a better path forward. At wells fargo, its our expertise in finding this kind of insight that has lead us to become one of the largest investment and Wealth Management firms in the country. Discover how we can help find your unlock. Check, please. Word breaking the louvre, the new one in abu dhabi will get the 450 amazing salvador mundi. They tweeted out the picture in english and arabic or the discussion, pictures, obviously the picture and also in french. Listen, im not an art crate tick but reiterate my indepth analysis of robert frank a few weeks ago, its not good its a small painting, not very big. And so retouched. Yeah. Whats unfortunate the way we do our tweets you cant include the photo or the visual. So i found myself anything as we were listening to the president s speech about moving the embassy to jerusalem, the president is a builder he wants to build a wall and an embassy. Id like to know what you think. Which will be built first. A new embassy in jerusalem or the border wall . Well post that on our twitter page why dont you let us know what you think. And mine is los angeles these fires are devastating. Sonoma had one a month and a half ago a lot of good men and women are risking their lives fighting the fires. Prayers for the angelinos out there. From california from a fire perspective hopefully they have the water and water pressure so just thinking about the city of my birth, the city of angels, be safe take care. Our prayers are with them thanks for watching power lunch. Closing bell starts right now. Hi, everybody, welcome to closing bell on wednesday. Im kef kel i evans. I had to look im bill griffeth. Just told cbc the easy money has been made. More of howards comments and Money Managers tell us where they see opportunity. The senator blocking any significant action in the s. E. C. Right now. Democrat Tammy Baldwin on why she wont approve two s. E. C. Commissioner tomnys. We have a lot to talk with her about, as a matter of fact and look forward to that a new report says